Startup Ecosystem Report: Tunisia
In general, Tunisian cities are fairly well positioned in the Startup Friendliness Index (SFI). This report compares four Tunisian cities – Kairouan, Sfax, Sousse, and Tunis – to four other MENA-region cities in the MENA regional SFI, as well as to 15 cities in Asia, Latin America, and Africa in the global SFI. Scores range from 0 – 100, with a score of 0 for the city with the weakest performance, to 100 for the strongest. Throughout the report, the referenced SFI scores are from the MENA regional SFI, and the cities are ranked both in comparison to the MENA and global SFI.
Three of the measured Tunisian cities (Sfax, Sousse, and Tunis), rank in the middle of both the global and MENA regional SFIs. The situation is more difficult in Kairouan, which is currently in the second-to-last position in both rankings. Within Tunisia, Tunis has the strongest performance, scoring 49,22 out of 100, and ranking eighth in the global SFI. Sfax follows with a score of 45,19, then Sousse (scoring 43,52), and lastly Kairouan with a score of 37,38.
Startup Friendliness Index scores are determined by examining 81 indicators in six domains: Human Capital, access to Finance, the liveliness of the Startup Scene, Infrastructure quality, Macro framework (describing the political and legal system), and Market conditions (such as trade balance and capacity utilisation). Cities with relatively even scores across domains receive a higher overall score than a city with strong performance in one area, and weak performance in another.
For Tunis, the city with the highest overall SFI score, Infrastructure and Macro are the strongest domains, while Finance is particularly challenging. In contrast, Sfax finds strength in the Finance domain, but Market conditions are not favourable. Human Capital is notably strong in Sousse due to a high number of educational institutions relative to its small population, though accessing Finance is a hindrance for entrepreneurs. Kairouan has fairly even scores across most domains, though its Startup Scene is in the very early stages.
Based on findings from the Startup Friendliness Index, this report concludes with a series of policy recommendations to support the development of the startup ecosystem. These include enhancing the quality of education to better prepare future entrepreneurs, strengthening local policies, increasing opportunities for financing, improving the startup scene’s connectedness with programmes and spaces that boost business ideas and foster networking among Tunisian entrepreneurs, and including women more fully in entrepreneurial roles and the economy.
