By Christian Lowe
Jan 10 (Reuters) - Fourteen civilians were killed in Tunisia at the weekend in clashes with police after the worst wave of unrest the north African country has seen in decades. [ID:nLDE7090L3]
Here are some questions and answers on what the possible implications are, and what lies behind the violence.
WHAT WILL HAPPEN NEXT?
There are several possible scenarios:
-- The unrest tapers off in the face of heightened security and government warnings that rioters will be jailed.
-- The violent unrest carries on and spreads to the capital. In this case, the authorities will have a tough choice. If they keep using force to quell the riots they risk international condemnation, with the economic consequences that could go with it. If they do not, the protests could spiral out of control, challenging the government's grip on power.
-- A political accommodation is found. A minister said on Sunday the government was ready for a dialogue about the protesters' grievances. It is not clear though how far the authorities are prepared to go. Will there just be a change in policy? Or will there be a more wholesale change?
WHY IS THE UNREST HAPPENING?
It all started last month in the town of Sidi-Bouzid, about 200 km (125 miles) southwest of Tunis. A young man called Mohamed Bouazizi set himself on fire in a protest at police, who had stopped him trading from an unlicensed street stall. He later died in hospital.
People in the town took to the streets, and the unrest then spread to other towns. The government says the rioting is driven by extremists bent on violence, but the unrest appears to have tapped in to a number of grievances.
-- One is high youth unemployment. Tunisia's economy has grown strongly in the past decade, but the downturn in the euro zone, by far its biggest trading partner, has slowed growth. The country has thousands of young people who have graduated from higher education but cannot find work. The problem is especially acute in the interior of the country, away from more prosperous coastal areas. A September 2010 International Monetary Fund report said unemployment stood at 13.3 percent and had begun to rise. "The country's key challenge is to boost job-generating growth and lower unemployment," the report said.
-- Anger about public investment. The Tunisian government says it has poured millions of dollars into deprived areas. Many people say more should be done. The government's room for manoeuvre is limited because unlike neighbours Libya and Algeria, it does not have a pot of cash from energy exports. The government forecasts a budget deficit of 2.5 percent of gross domestic product this year, and it is running a public debt of 39 percent of GDP. It says it will this year go to international debt markets for the first time in two years to borrow about ${esc.dollar}2.7 billion. [ID:nLDE6AM0T8]
-- Civil liberties. Tunisian officials say the country is committed to democracy and respects human rights. In its 2009 human rights report, the U.S. State Department said the Tunisian government was intolerant of criticism and that there were significant limitations on citizens' rights to change their government through the ballot box.
IS THE GOVERNMENT'S HOLD ON POWER UNDER THREAT?
Zine al-Abidine Ben Ali, the 74-year-old president, dominates the political landscape. He has been in power since November 1987 and was re-elected to a fifth term two years ago with 89.6 percent of the vote. Many Tunisians credit him with making the country an island of stability and prosperity in an otherwise volatile region. The opposition is weak and divided.
Members of Ben Ali's family also have a high profile. The activities of his wife, Leila, are given lavish coverage in state media. The president's son-in-law, Sakher Materi, is one of Tunisia's most prominent businessmen, a member of parliament and owner of the biggest-circulation newspaper. In an interview with Reuters last year, he denied speculation he was being groomed to take on a senior role in government. [ID:nLDE63J11M]
Very few Tunisians will criticise Ben Ali in public but some do lambast the president and his entourage, especially on online social media, one of the few places where critical views can be found.
Tunisia's military and security forces are unswervingly loyal to Ben Ali in public, but diplomats and analysts say they are a powerful interest group in their own right.
One Western diplomat described Tunisia as a pressure cooker. If the protests and international criticism keep building, it is difficult to predict what would happen to Ben Ali's rule.
WHAT COULD BE THE ECONOMIC FALLOUT?
The unrest, and the government's handling of it, could have implications for the Tunisian economy:
-- Tunisia is in the process of negotiating with the European Union to extend an existing arrangement for free trade in industrial goods so that it also covers services, agricultural products and processed food. All of these are major Tunisian exports. A negative EU reaction to the violence could make those negotiations more complicated. Tunisia is also a recipient of hundreds of millions of euros in loans from the European Investment Bank, the EU's financing arm.
The EU has already signalled its concern. A European Commission spokeswoman said on Monday: "We deplore the violence and the loss of life."
-- The unrest could alarm investors, both inside and outside Tunisia. The main index on the lightly traded Tunis stock exchange fell 2.65 percent on Monday. Tunisia plans to float shares in state-run Tunisie Telecom on the Tunis and Paris bourses. [ID:nLDE6BG1IZ] That listing, the first by a Tunisian firm on a European exchange, will be a test of whether investor confidence has been dented. (Writing by Christian Lowe; Editing by Alison Williams)
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