Tunisia’s Water Crisis Puts Jobs and Growth at Risk as Economic Recovery Loses Speed

The government’s Plan Eau 2050 envisions investment of around US$900 million annually through mid-century, an undertaking whose success will depend on more than building infrastructure.

Tunisia's modest economic recovery faces a threat that reaches into farms, factories, hotels and households: a shortage of water that could reshape the country's prospects for decades. Growth remains slow, rising import prices leave the economy exposed, and imbalances in public finances restrict the government's room to respond. The World Bank's latest Tunisia Economic Monitor, Tunisia's Water Challenge: From Scarcity to Resilience, identifies the management of severe water scarcity as a key factor in whether the country can protect living standards, support businesses and create the jobs its population needs.

A recovery that leaves many people behind

Tunisia's economy grew by 2.7 percent in 2025 and recorded 2.4 percent year-on-year growth in the first half of 2026, supported by recovering agriculture, mechanical and electrical industries, and tourism. Those gains have not put the country on a strong growth path, with expansion projected to ease to 2.3 percent in 2026 and average 2.1 percent across 2027 and 2028. Unemployment fell to 14.9 percent in the second quarter of 2026, but the national figure masks a substantial gap between men and women: female unemployment stood at 21.6 percent, nearly twice the male rate, showing how unevenly economic opportunities are distributed.

Water shortages threaten livelihoods beyond farming

Tunisia has about 380 cubic metres of renewable freshwater available per person each year, placing it well below the international threshold for absolute water scarcity. Climate change and growing demand are expected to put further pressure on these limited supplies, making water security an increasingly important condition for growth and employment. Improved rainfall and reservoir levels last year brought welcome relief, but a better season does not resolve the underlying shortage or remove the need to prepare for sustained pressure on water resources.

The report estimates that water scarcity could reduce Tunisia's GDP by 6.4 percent by 2050, with particularly serious consequences for agriculture, which employs 14 percent of the national workforce and up to half of rural workers. Without action, water and climate stress could eliminate at least 30 percent of agricultural jobs by mid-century and significantly reduce agricultural output. The damage would spread through businesses that depend on reliable water supplies and farm production, including agro-processing, tourism and industry, turning a resource shortage into a broader threat to incomes and employment.

Investment needs reforms that deliver reliable water

Improving water security offers a source of employment as well as protection against economic losses. The World Bank Group-supported RESEau programme, designed 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. Ahmadou Moustapha Ndiaye, the World Bank's Division Director for the Maghreb and Malta, described water security as fundamental to jobs and growth, stressing that appropriate policies, institutions and investments can reduce the impact of scarcity on ordinary Tunisians' living standards.

The government's Plan Eau 2050 envisions investment of around US$900 million annually through mid-century, an undertaking whose success will depend on more than building infrastructure. The report calls for stronger water governance, financially sustainable services and better performance from providers, supported by a modernised Water Code and a framework for reusing treated wastewater. Improving cost recovery with protections for vulnerable households, reducing network losses, expanding digitalisation and strengthening irrigation management are identified as critical measures for turning that spending into lasting improvements in water security.