TUNISIA-CHINA RELATIONS MODEST, BUT TRADE TIES

C O N F I D E N T I A L TUNIS 000152

SIPDIS

FOR AF/RSA, EAP/CM, NEA/RA, AND NEA/MAG

E.O. 12958: DECL: 02/23/2020
TAGS: PREL PGOV EAID ETRD MASS TS CN
SUBJECT: TUNISIA-CHINA RELATIONS MODEST, BUT TRADE TIES
GROWING

REF: A. STATE 10152

B. 09 TUNIS 498 (NOTAL)

Classified by Ambassador Gordon Gray for reasons 1.4 (b) and
(d).

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Summary
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1. (C) Chinese engagement in Tunisia is broad but not deep.
Chinese assistance to Tunisia includes infrastructure
projects and some training grants. The commercial
relationship is growing but is not yet large. The last high
level meeting we know of took place in November, 2009 when
Zhai Jun, China's Secretary of State for Foreign Affairs, met
with then Minister of Foreign Affairs Abdallah in Tunis. In
June, 2009 Foreign Minister Abdallah visited Beijing and met
with his Chinese counterpart (ref b). China has provided
foreign assistance to build dams and technical assistance and
training for Tunisian officials. While specific data is not
available, assistance levels appear to be modest. Bilateral
trade was approximately $890 million in 2008, of which $836
million was Tunisia's imports from China. Tunisia's imports
began increasing sharply after 1999 while its exports to
China have increased more gradually. We are not aware of any
Chinese military assistance other than some language training
for officers. While we are open to suggestions for
U.S.-Chinese collaboration in Tunisia, we do not see any
obvious opportunities. End summary.

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High-Level Meetings
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2. (SBU) The last high-level meeting we are aware of between
China and Tunisia occurred November 26, 2009. Zhai Jun,
China's Secretary of State for Foreign Affairs, met in Tunis
with then Minister of Foreign Affairs Abdallah. According to
media accounts, Foreign Minister Abdallah focused on the
private sector's role in the relationship, saying it could
"bolster cooperation in different sectors through partnership
projects." Media reports also state the two countries have
signed 23 agreements in economic, technical, diplomatic,
scientific, and financial sectors. They signed their first
trade agreement in 1995. In June, 2009, Minister of Foreign
Affairs Abdallah visited Beijing and met with his Chinese
counterpart. During his visit they signed an economic and
technical cooperation pact. In March, 2008 a senior member
of the Chinese Communist Party's Political Bureau, Li
Chanqchun, met with Hedi M'henni, then Secretary General of
the ruling RCD party. During the meeting they witnessed the
signing of a cooperation agreement between the two countries.
A Tunisia-China Friendship Association is currently headed
by prominent businessman Walid Loukil.


3. (C) The Chinese Ambassador in Tunis told us last year
that China-Tunisia bilateral relations had suffered in recent
years from limited access to GOT officials imposed by the
Ministry of Foreign Affairs, a common complaint among foreign
diplomats in Tunis.

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Trade
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4. (SBU) There are signs that the two countries are trying
to expand their bilateral commercial relations. The two
sides are reportedly discussing a free trade agreement. In
2008, Tunisia participated for the first time in a tourism
industry trade fair in Guangzhou. We also heard in 2008 that
China was considering opening an office of the shipping
company Cosco, but have not seen any evidence of
implementation. In November 2009, Secretary of State for
International Cooperation and Foreign Investment Abdelhamid
Triki represented Tunisia at the fourth Chinese-African
Cooperation Forum in Sharm El-Sheikh.


5. (SBU) China-Tunisia bilateral trade is growing
significantly; the total value in 2008 was approximately
$889.6 million -- up from approximately $103 million in 1999.
Tunisia's exports to China saw a more gradual increase,
from approximately $26 million in 1999 to $53.6 in 2008.
Tunisian exports include phosphates, oranges, and melons,
while China exports a wide range of consumer goods, as well
as tea, sugar, and other foodstuffs to Tunisia. Tunisia is
apt to see China as a competitor for its exports of consumer
goods, including textiles. A 2008 World Bank report,

"Strengthening MENA's Trade and Investment Links with China
and India," reported that Tunisia may be one of the MENA
countries that has seen its exports decline in the face of
Chinese competition. However, Tunisia may also be benefiting
from greater integration of the global market, driven in part
by China, for electrical and motor vehicle parts.

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Military Assistance
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6. (C) As reported in the press, Cao Gangchuan, vice
president of China's Central Military Commission, headed a
delegation of Chinese officials to Tunisia in 2007 and met
with then Tunisian Minister of Defense Kamel Morjane. The
Ministry of Defense has courses in Madarin for its officers
and China has provided grants for about 10 officers per year
to study in China. We have not seen any signs of Chinese
military equipment being used in Tunisia.

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Foreign Assistance
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7. (SBU) China has provided some development assistance to
Tunisia over the years, usually for infrastructure projects.
The two countries concluded a bilateral agreement at the
China-Africa Cooperation Forum in Beijing in 2006 and the
Chinese provided funds for two dam projects in Tataouine that
same year. In 2008, China started sending volunteers to
Tunisia who work in the cultural sector, teaching Chinese,
table tennis, martial arts, and dancing - often in remote
areas of Tunisia. In December 2009, the media reported a
Chinese gift to the GOT of 6,200 computers. At least 300
Tunisian civil servants have been invited to China for
training programs that cover agriculture, energy, trade,
construction and public health. China has a longstanding
program, started by a Chinese Ambassador in the 1970s, to
send medical doctors to southern areas of Tunisia to help
underserved communities.


8. (SBU) In February 2009 the Tunisian Minister of Health met
with the Chinese Vice-Minister of Health. The two officials
discussed the opportunities for cooperation in the medical
field and the Vice-Minister indicated his country's interest
in participating in a new university hospital project in
Sfax. In September, 2009, work began on a 300 bed university
hospital in Sfax, estimated to cost $32.6 million.

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No Obvious Opportunities for U.S.-Chinese Collaboration Here
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9. (C) There are no examples of U.S.-China collaboration in
Tunisia, either private or public. While we are open to
ideas for collaboration, we do not see any obvious
opportunities.

GRAY