TUNIS, September 22, 2026 – Tunisia’s economy has settled into a path of slow growth, and is vulnerable to rising import prices and imbalances in public finances. One key determinant of the country’s economic prospects is how it manages severe water scarcity, according to the World Bank’s latest Tunisia Economic Monitor, “Tunisia’s Water Challenge: From Scarcity to Resilience.”
Economic growth reached 2.7 percent in 2025 and 2.4 percent year-on-year in the first half of 2026, driven by a recovery in agriculture, mechanical and electrical industries, and tourism. Growth is projected to ease to 2.3 percent in 2026 and average 2.1 percent over 2027-2028. While unemployment declined to 14.9 percent in the second quarter of 2026, women continue to face significantly weaker labor market outcomes, with unemployment standing at 21.6 percent, nearly twice the rate for men.
The report’s special chapter highlights water security as one increasingly important driver for economic growth and job creation. Tunisia currently has about 380 cubic meters of renewable freshwater available per person each year, well below the international threshold for absolute water scarcity. Climate change and growing demand are expected to intensify pressure on already limited resources.
The economic costs of inaction would be substantial. The report estimates that water scarcity could reduce Tunisia’s GDP by 6.4 percent by 2050. Agriculture, which employs 14 percent of the national workforce and up to half of rural workers, is particularly vulnerable. Without action, water and climate stress could eliminate at least 30 percent of agricultural jobs by mid-century and significantly reduce agricultural output. The consequences would extend well beyond farms, affecting tourism, agro-processing, industry, and other water-dependent sectors.
Yet water security is not only about mitigating risks. It is also an opportunity to create jobs and strengthen economic resilience. The World Bank Group-supported RESEau program, a major initiative to strengthen the resilience of Tunisia’s water sector, is expected to generate around 4,000 permanent jobs and 13,400 temporary jobs during its first phase alone.
