The African Development Bank (AfDB) has approved a financing package of 92.3 million euros for the Tunisian Government’s Support Program for Business Competitiveness and Empowerment of the Population through Job Creation (CAP-Emplois).

This initiative is set to play a pivotal role in enhancing economic inclusion, improving living standards, and fostering sustainable development in Tunisia.

The approved financing consists of a 90-million-euro loan from the AfDB and a 2.3 million euro grant from the Women Entrepreneurs Finance Initiative (We-Fi) Trust Fund, under the Affirmative Finance Action for Women in Africa (AFAWA) initiative. The We-Fi grant is particularly significant as it underscores the AfDB’s commitment to supporting women entrepreneurs, aiming to reduce the barriers they face in accessing finance and scaling their businesses.

The CAP-Emplois program, designed by the Tunisian Ministry of Employment and Vocational Training with support from the AfDB, is set to be implemented over four years starting in November 2024. The program’s primary objective is to create jobs by promoting entrepreneurship and skills development. By supporting the creation of new businesses and the formalization and growth of existing ones, CAP-Emplois aims to address the structural constraints that hinder investment, productivity, and economic growth in Tunisia.

Malinne Blomberg, Deputy Director General of the Bank Group for North Africa and Country Manager for Tunisia, highlighted the program’s importance: “The findings of a survey by the Bank in Tunisia show that established and potential entrepreneurs could create many jobs, but they are subject to structural constraints that hold back investment projects, productivity, and growth. This project helps entrepreneurs to address these problems.”

Addressing Key Constraints to Entrepreneurial Growth

Entrepreneurs in Tunisia face several challenges, including limited access to education and markets, especially for informal businesses. Additionally, the difficulty in recruiting employees with the necessary skills, along with a lack of access to business support services and finance, further hampers the growth of entrepreneurial ventures. The CAP-Emplois program is designed to mitigate these constraints through three key interventions:

This initiative aims to equip young people and women with the skills required to secure salaried jobs. By focusing on skill development, the program seeks to improve employability and reduce the skills gap in the Tunisian labor market.

Building on the success of the Souk At-Tanmia initiative, this service will extend access to tailored support for various target groups, particularly women. The goal is to provide entrepreneurs with the necessary resources, mentorship, and guidance to start and grow their businesses.

Strengthening institutional capacity is crucial for the sustainable implementation of the CAP-Emplois program. By enhancing the capabilities of relevant institutions, the program aims to create a more conducive environment for entrepreneurship and job creation.

A Focus on Women and Youth

The Tunisian government projects that the CAP-Emplois program will create approximately 118,900 formal jobs—76,600 directly and 42,300 indirectly. Significantly, the program places a strong emphasis on empowering women and youth. At least 50% of the entrepreneurs who benefit from training and professional integration will be women, while 45% of the businesses that receive support for establishment, formalization, and financing will be female-led.

The We-Fi grant under the AFAWA initiative will play a crucial role in reducing loan initiation fees for women-owned businesses, thereby increasing the share of women entrepreneur beneficiaries from 35% to 45%. This targeted support reflects the AfDB’s broader commitment to gender equality and the economic empowerment of women in Africa.

“This program consolidates our commitment to promoting employment in Tunisia, helped by lessons learned from the Souk At-Tanmia initiative and by the operational innovations developed by the EInA platform. The objectives of the program are to overcome constraints associated with the expansion and financial sustainability of businesses and to leverage private investment.” Malinne Blomberg.

The CAP-Emplois program represents a significant step forward in Tunisia’s efforts to foster entrepreneurship, create jobs, and drive inclusive economic growth. By addressing key challenges faced by entrepreneurs and focusing on the empowerment of women and youth, the program is poised to contribute meaningfully to Tunisia’s socio-economic development and set a precedent for similar initiatives across the African continent.