11/01/2017

The Phosphate

Cluster of Gabes Outline and Recommendations for

future growth

ELABORATED BY HAYTHEM ABIDI

UNDER THE SUPERVISION OF M. HATEM MHENNI ENGINEERING & TECHNOLOGY POLICY MASTER’S PROGRAM

2016/2017

National Engineering School of Tunis

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Abstract

This paper aims to measure the impact of the Bouchemma Industrial zone growth, social and

economic impact on the region. Using a cluster approach, it identifies the main determinants of

the regional cluster, clarifies the nature of its network relations and interdependencies and gives

an overall hierarchy. This analysis should be based on a database inventory of empirical attributes

(Knowledge promotion, strategic management, R&D promotion, knowledge transfer, partnership s

and cooperation, government orientations & policies, PME’s, etc...). The challenge ahead lies in

the location and extraction of the data. Therefore, serious attention was given to the practical

methodology choice. A basic internet search and personal contact was carried to gather the support

database. The purpose of this study is to give a general anatomy of the region’s main revenue and

employment generator in order to determine its major strengths and weaknesses in term of

innovative performance. The study can be used as a support for future work in elaborating

development policies for regional competitiveness enhancement.

Résumé

Cet article vise à mesurer l'impact de la croissance de la zone industrielle de Bouchemma, ainsi

que l'impact social et économique sur la région. En utilisant l’approche Cluster, il identifie les

principales composantes du cluster régional, clarifie la nature de leurs relations de réseau et ses

interdépendances et donne une hiérarchie globale. Les principaux défis rencontrés dans ce travail

sont la collecte de données concernant les entreprises, leurs secteurs de production et

l'environnement de réseautage. Une recherche sur internet et un contact personnel ont été utilisé s

pour rassembler la base de données de support. Le but de cette étude est de donner une anatomie

générale du principal générateur de revenus et d'emplois de la région afin de déterminer ses

principales forces et faiblesses en termes de performance innovante. L'étude peut servir comme

support aux futurs travaux d'élaboration de politiques de développement pour l'amélioration de la

compétitivité régionale.

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Summary Table of Figures .........................................................................................................................................................................3

Table of Arrays ...........................................................................................................................................................................3

Introduction ..................................................................................................................................................................................4

Chapter I: Industrial clusters ................................................................................................................................................5

I. About industrial cluster ....................................................................................................5

II. Determinants of an industrial cluster ................................................................................5

III. Performance......................................................................................................................7

IV. Cluster formation ..............................................................................................................7

1. Policy ................................................................................................................................8

2. Local environment ............................................................................................................8

3. Entrepreneurs....................................................................................................................8

V. Clustering phases ..............................................................................................................9

1. First phase .........................................................................................................................9

4. Second Phase ....................................................................................................................9

5. Third phase .....................................................................................................................10

VI. Cluster samples ...............................................................................................................10

1. Developed countries: California wine ............................................................................10

2. Developed countries: Italian leather ...............................................................................11

3. Developing countries: Morocco’s automotive cluster ....................................................11

Chapter II: Measuring the clustering process in Gabes region.........................................................................13

I. Gabes region: overview ..................................................................................................13

1. Geography ......................................................................................................................13

2. Population .......................................................................................................................14

3. Infrastructure ..................................................................................................................14

4. Platform for knowledge based economy development ..................................................14

II. Industry ...........................................................................................................................15

1. Regional economic profile .............................................................................................15

2. Anatomy of the industrial cluster: focus on Bouchemma industrial zone ......................16

Recommendations & General Conclusion..................................................................................................................23

References ...................................................................................................................................................................................24

3

Table of Figures Figure 1 Hierarchy of an industrial cluster......................................................................................6

Figure 2 Factors in the emergence of regional clusters (M.P.Feldman, J.Fransis) .........................7

Figure 3 Anatomy of the California wine cluster..........................................................................10

Figure 4 Anatomy of the Italian leather fashion cluster................................................................11

Figure 5 Morocco's automotive cluster map (B.M, K.S, J.E, R.B) ...............................................12

Figure 6 Map of Gabes ..................................................................................................................13

Figure 7 Politech Gabes Network of Associates ...........................................................................19

Figure 9 Hierarchy of the Bouchemma industrial cluster .............................................................22

Figure 10 Enterprise distribution by sector in the industrial cluster of Gabes-Bouchemma ........22

Table of Arrays

Tableau 1 History of the Tunisian Chemical Group (TCG)..........................................................15

Tableau 2 State support shares to employer's CNSS payments, delegation of Mareth.................21

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Introduction

The fluctuating economy of Gabes’s region provides both opportunities and challenges.

The region’s manufacturing capabilities has enormously felt the impact of post revolution socio-

political tornado. Yet, a newer economy has helped the region –on a relative scale- to recover

(health, construction, agriculture).

Still, it is essential to identify the region’s main revenue generator. The idea proposed is to

provide an overview of the region’s economy, propose a basic profile of the economy of Gabes

and examine the major industry sectors and clusters that make up its economy. The cluster analysis

method is proposed in accordance with the geographical and economical context of Gabes’s

industries.

The region is well known for its heavy chemical industries whom are interdependent and

sharing geographical proximity. The anchorage of the first heavy industry units in Bouchemma

created opportunities for employment in the region. Furthermore, it can be noticed today that

newer industries, small and medium enterprises were created and evolved around the same

geographical perimeter and thus generating more revenue, creating more employment

opportunities and bringing wealth to the region. This clustering process can should be given

attention by policy makers in order to formalize and create an adequate ecosystem for innovation

to take place within the cluster. Therefore, Policy makers should understand the nature of the

cluster, determine its major components and interdependencies in such a way that helps

understand and identify weaknesses and strengths to be dealt with in future policy development

plans. Therefore, this work tries to answer the following question: Did the installation of the first

Tunisian Chemical Group create a fully functioning industrial cluster in the region? To what extent

did the clustering process take place in Gabes?

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Chapter I: Industrial clusters

I. About industrial cluster

Clusters are groups of inter-related industries that drive wealth creation in a region, primarily

through export of goods and services. The use of clusters as a descriptive tool for regional

economic relationships provides a richer, more meaningful representation of local industry

drivers and regional dynamics than do traditional methods. An industry cluster is different from

the classic definition of industry sectors because it represents the entire value chain of a broadly

defined industry from suppliers to products, including supporting services and specialized

infrastructure. (SDAG)

Cluster industries are geographically concentrated and inter-connected by the flow of goods and

services, which is stronger than the flow linking them to the rest of the economy. Within

regional clusters (a subset of Porter’s (1990, 1998) clusters), firms may operate more efficient ly

and innovate faster due to sharing common technologies, infrastructure, pools of knowledge and

skills, inputs and responding to demanding local customers.

There is an increasing need for cluster-based data to support research, facilitate comparisons of

clusters across regions and support policymakers in defining regional strategies.

II. Determinants of an industrial cluster

In a wider sense, a cluster is a group of companies operating in the same chain or in the value

chain and associated institutions / organizations that face the same challenges and opportunit ies.

This group of companies are usually:

Enterprises of the same productive sector.

Anchored on the same territory.

Maintaining cooperative relations (networks, consortium).

Animated by a coordination structure.

Supported by partnerships with local public actors.

Implementing collaborative projects.

Dealing with common problems and issues.

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Prod

ucts &

servic

es

$$

Figure 1 Hierarchy of an industrial cluster

Domestic &

Global Markets

Cluster’s main determinants

- Buisines services - Manufacturer Industry

- Communication - Waste management - Financial services etc….

Linkage industries

Industries providing factors of production for the cluster industries

and serving the local market

Income Investment

and taxes

Foundation and

potential for local

economy

Public/Private Infrastructure Support

Human ressources Capital finance Technology & R&D

Physical infrastructure Tax & regulatory environment

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III. Performance Clusters affect competition in three broad ways:

First, by increasing the productivity of companies based in the area.

Second, by driving the direction and pace of innovation, which underpins future

productivity growth.

Third, by stimulating the formation of new businesses, which expands and strengthens the

cluster itself. A cluster allows each member to benefit as if it had greater scale or as if it had

joined with others formally—without requiring it to sacrifice its flexibility.

Moreover, being part of a cluster allows companies to operate more productively in sourcing

inputs; accessing information, technology, and needed institutions; coordinating with related

companies and measuring and motivating improvement.

IV. Cluster formation

A great deal of theories about cluster functioning exist today, a good perception and

understanding about how clusters can foster innovation, create wealth and employment in a

region. Yet, the question of how a cluster is started in a region persists. There is limited

understanding about how clusters form and develop and why they do in some regions and not

in others. The argument that three pillars for cluster formation is developed:

Public gouvernance/ Policy

Local Environnement

Entrepreneurs

Figure 2 Factors in the emergence of regional clusters (M.P.Feldman, J.Fransis)

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1. Policy

Policy and governance main objectives is in the heart of cluster determinants coordination and

enterprise creation. It eases the way for entrepreneurs for start-up creation and promotes self-

employment culture. Indeed, Alignment between regional development policies and strategic

national vision should be insured in the policy making process. Regional policy makers should

emphasize on the importance of beneficial risk taking through acts and programs, whether public ly

or privately funded or both.

2. Local environment

Taking the decision to start a business can be very complex to analyze and to give a generalized

theory about why it is concentrated in a certain agglomeration and not in another. Yet, it seems

rational to admit that certain environmental factors influence in a direct or indirect manner:

Local resources: they vary from region to region, whether natural, human infrastructure or of

any kind. Identifying a regional strength is a necessary condition for certain business launchers.

R&D, technological transfer institutions and central coordinating bodies: They operate in a

systemic manner to create, store, share and apply knowledge to local businesses through R&D

valorization programs, mobilizing partnerships and funds for innovative project creation etc.…

Cultural aspect: This remains the most unmeasurable and unpredictable aspect. Surely, most

theories now imply that entrepreneurship is all about risk taking which can be seen as an intuit ive

human behavior.

3. Entrepreneurs

Clusters may be conceived as ecologies of mutually dependent firm and institutions. The

entrepreneur exploits his local environment to further innovation and localized learning. It is obvious

to notice that each of the components listed previously positively reinforces the other, promoting

industry development and the evolution of a cluster. Once the incentives and the environment are

aligned, the result is a fully functioning industrial cluster that is able to sustain economic growth as

well as withstand adverse shocks.

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V. Clustering phases

The following dichotomy of cluster formation process is presented:

1. First phase

In the earliest stages, there is little technology-intensive industrial activity. Although, a region may

have the type of human capital or prominent research universities that might be associated with an

industrial clusters, few start-up companies would exist. The movement from latent to active

entrepreneurship requires some shock possibly to the demand for entrepreneurs or traditiona l

business, whether private or public sector, as well as a reduction in the opportunity cost of

entrepreneurship. Once the initial entrepreneurial ventures have been sparked, the process of

entrepreneurship is a classic trial and error or learning-by-doing process (Zaltman, Duncan and

Holbeck 1973). (M.P.Feldman, J.Fransis)

4. Second Phase

The second phase is dominated by increased entrepreneurial activity as an adaptation to a series of

changes in the external environment. During this stage, entrepreneurs defined resources to promote

and protect their interests. In this way, the independent actions of entrepreneurs are catalytic

components of a self-organizing system. Further, the cluster self- organizes around the

entrepreneurial activities. Entrepreneurial activity is 9 creative and innovative and therefore, the

specific needs of the entrepreneur cannot be predicted a priori, but develop over time as start-ups are

created and the needs are recognized. Once a critical mass of start-ups is in place, supporting

organizations are attracted. The organization of the cluster and the entrepreneurial ventures evolve

simultaneously and even symbiotically. Having the experience and example of the initial start-ups,

the industry becomes self-sustaining: entrepreneurs attracted physical and human capital to the area,

public and private networks built up to support and facilitate the ventures, relevant infrastructure was

created through public and private initiatives and services grew up to feed these companies. For some

regions, exogenous shock, such as corporate mergers and acquisitions may compact the industr ia l

sector into a small number of large multinational firms or a more research oriented cluster.

(M.P.Feldman, J.Fransis)

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5. Third phase

The ultimate result is a fully functioning entrepreneurial environment within an innovative and

adaptable industrial cluster. The success of the initial start-ups, and the synergy between them,

generates new possibilities for further start-ups and new spin-offs. Networks of entrepreneurs, policy

makers, and secondary industry contractors spring up; universities, colleges and technical centers

recognize the need for high-tech trained personnel and offer programs to satisfy that demand. The

success and experience of the initial activity further generates local recognition of the nascent

industry. Local recognition, a reduction in risk, and more opportunities created by the initia l

companies, contribute to more start-up activities. (M.P.Feldman, J.Fransis)

VI. Cluster samples

1. Developed countries: California wine

The California wine cluster is a good example. It includes 680 commercial wineries as well as several

1000 independent wine grape growers. An extensive complement of industries supporting both wine

making and grape growing exists, including suppliers of grape stock, irrigation and harvesting

equipment, barrels, and labels; specialized public relations and advertising firms; and numerous wine

publications aimed at consumer and trade audiences. A host of local institutions is involved with

wine, such as the world-renowned viticulture and enology program at the University of California at

Davis, the Wine Institute, and special committees of the California senate and assembly. The cluster

also enjoys weaker linkages to other California clusters in agriculture, food and restaurants, and wine-

country tourism. (M.Porter)

Figure 3 Anatomy of the California wine cluster

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Figure 4 Anatomy of the Italian leather fashion cluster

2. Developed countries: Italian leather

Consider also the Italian leather fashion cluster, which contains well-known shoe companies such as

Ferragamo and Gucci as well as a host of specialized suppliers of footwear components, machinery,

molds, design services, and tanned leather. (See the exhibit “Mapping the Italian Leather Fashion

Cluster.”) It also consists of several chains of related industries, including those producing different

types of leather goods (linked by common inputs and technologies) and different types of footwear

(linked by overlapping channels and technologies). These industries employ common marketing

media and compete with similar images in similar customer segments. A related Italian cluster in

textile fashion, including clothing, scarves, and accessories, produces complementary products that

often employ common channels. The extraordinary strength of the Italian leather fashion cluster

can be attributed, at least in part, to the multiple linkages and synergies that participating Italian

businesses enjoy. (M.Porter)

3. Developing countries: Morocco’s automotive cluster

The automotive industry in Morocco has grown into a substantial cluster, which by 2013 had a

vehicle production of 167,000, €2.8 billion in exports, 85,000 employees and over 200 companies.

The cluster is mostly based in the Casablanca Industrial Zone and the Tangier/Kenitra free zones.

These zones offer fiscal incentives and have strong infrastructure (a modern road network and

state-of-the-art ports). The cluster benefits from geographical proximity to large European

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consumer markets and the potential to function as a gateway to emerging markets in North Africa

and the Middle East. The main player of the cluster is Renault, which owns 80% of the Casablanca

plant and is the only manufacturer in Tangier. The cluster is significantly integrated into the local

economy. 43% of car parts are sourced from local suppliers, including electronic components,

plastics and metals. Exhibit 7 shows all the major suppliers. Renault uses these parts supplied to

builds Logan, Tandero, Kangoo, Lodgy and Dokker cars, as well as its cheaper brand Dacia. Some

of the car parts made in Morocco are exported to other car manufacturers in Europe. Figure 5

provides the cluster map, showing all major actors in the automotive cluster. Educational institutes

play an important role to train the workforce with the appropriate skills for the automotive

industry, which is necessary to overcome the current skill gaps. Government agencies and public

investment funds have been important for the initial growth of the cluster (as addressed in more

detail in the next paragraph). Institutes for collaboration facilitate the creation and implementa t ion

of a common strategy among different actors, and diffuse knowledge and best practices in the

industry. (B.M, K.S, J.E, R.B)

Figure 5 Morocco's automotive cluster map (B.M, K.S, J.E, R.B)

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Chapter II: Measuring the clustering

process in Gabes region

I. Gabes region: overview

The fluctuating economy of Gabes’s region provides both opportunities and challenges. The

region’s manufacturing capabilities has enormously felt the impact of post revolution socio-

political tornado. Yet, a newer economy has helped the region –on a relative scale- to recover

(health, construction, agriculture).

1. Geography

The region of Gabes is located in the south-east of the country and in the middle of the

Mediterranean, constituting an important linkage between the South-East and the rest of the

country, which helped develop a flow of exchange with its national and internationa l

environment. It is bounded on the east by the Mediterranean (a coast of 80 km), on the west by

the governorate of Kebili, on the north-east by the governorate of Sfax, on the north-west by

the governorate of Gafsa and at the south by the governorate of Medenine. Gabes extends over

7166 km² (4.6% of Tunisia’s total surface) and benefits from 80 km of cost.

Figure 6 Map of Gabes

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2. Population

370 803 people live in Gabes. 97 832 are considered as occupied working age population (24.7%)

and 62.2% of the whole population live in urban areas. The region has the 4rth lowest

unemployment rate following Tunis, Sousse and Sfax.

3. Infrastructure

Gabes benefits from a relatively strong and diverse infrastructure which consists of:

Commercial port approximately 12m deep (the deepest in the nation).

Gabes-Matmata international airport with a capacity of 200,000 passengers.

A rail network with a length of 135 km (linking Gabes to Gafsa, Sfax, Sousse and

Tunis).

Highway linking Sfax to Gabes over a length of 152 km.

4. Platform for knowledge based economy development

a. Human resources

Gabes is privileged with its high qualified human resource asset consisting of:

19129: Students (Gabes: 17181, Medenine: 1799, Tataouine: 149),

1620: Teachers Researchers (Gabes: 1422, Medenine: 184, Tataouine: 37),

4584: Graduates of higher education,

7 public vocational training centers,

59 private vocational training centers,

b. Research and Development

Gabes is also well equipped in terms of R&D institutions, they include:

1 Multi-sectoral industrial and technological center,

1 Technical center for geothermal and greenhouse crops,

1 Station of the National Institute of Rural Engineering, Water and Forests,

1Station of the National Institute of Sciences and Technologies of the Sea,

1 Regional Directorate of the Institute of Arid Regions (IRA),

14 Research Units,

2 Research Laboratories,

1 Doctoral School.

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II. Industry

1. Regional economic profile

Gabes Governorate is home to diversified economic activity, including an important industrial sector

specialized in the chemical industry. Following many years of raw phosphate exporting, the Tunis ian

government undertook to process phosphate ore and to exploit it in a more profitable oriented way.

This brought to the creation of a domestic industry for phosphoric acid and fertilizer production,

eventually resulting in the “Tunisian Chemical Group” (GCT)-TCG is considered the region’s main

revenue generator and its major employment source-which is the result of the merger and absorption

of some five companies occurring between 1952 and 1992 as indicated in the following table

Tableau 1 History of the Tunisian Chemical Group (TCG)

Startup of TSP plant in SFAX under the name of SIAPE

Startup of Acid (MGA) plant in GABES under the name of ICM

Startup of the DAP plant in GABES under the name of SAEPA

Startup of the AN plant by SAEPA

Startup of ENGRAIS DE GABES (EG) for the production of DAP in GABES

Creation of Industrie Chimique de GAFSA (ICG) for TSP production at M'DHILLA

Creation of the SKHIRA plant for the production of Phosphoric Acid and MGA

Absorption of ICM, EG and ICG by SIAPE

Merger of SIAPE and SAEPA and creation therefore of GCT

Merger of Chairmanship of CPG and GCT by appointing a single common Chairman

and General Manager

Merger of commercial structures of CPG and GCT.

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Today, the region more than 110 industrial enterprises employing 8749 workers, 18 of them are export

oriented fully operating companies that employ almost 5500 person.

2. Anatomy of the industrial cluster: focus on Bouchemma industrial

zone

The zone is the largest functioning zone in the region in terms of GDP contribution. It is the

home of major industrial complexes for the transformation of Tunisian phosphates and related

activities: GCT, Alkimia, FCI, Salkta Fertilizers... it also incubates a decent number of small and

medium enterprises providing direct services, products and related activities. This group of

enterprises are coordinated by the mean of a central coordinating body “Poyltech Gabes” whose

activities and interest will be detailed below.

a. Large manufacturer industries

The zones main sector of productivity is phosphate transformation and related derivatives. The

largest manufacturer companies anchored in the region are:

Tunisian Chemical Group: The group includes the phosphoric acid production company ICM created

in 1972, Diammonium phosphate/Ammonitrate production company SAEPA created in 1979 with

an annual capacity production for D.A.P of 1 015 000 Tons/year and an Ammonitrate production

capacity of 150 000 Tons/year.

Alkimia: Totally exporting company created on September 26, 1972 and started its production of

Tripolyphosphate Technical Sodium in 1976. Alkimia processes phosphoric acid obtained from TCG

in order to produce TTS.

Timab: With two plants created in 2003 and 2008, TIMAB processes and bags phosphate bought from

the TCG for animal nutrition with a total annual production capacity of 270 000 Tons/year.

Fluor C hemica l Indus tr ie s : Founded in 1971 and s ta r ted p roduc tion o f Aluminum

fluoride in 1976 for local and global markets. In 2009, FCI started the production of Anhydrite

destined for the consumption of local cement factories (Cement of Gabes factory in particular). This

company utilizes sulfuric acid bought from the TCG in order to produce Aluminum fluorine.

Salakta fertilizers: Created in 1998, this company is specia l ized in the production of nitrogen

fertilizers for agricultural use. Its main products are powder TSP (Triple Super Phosphate) and SSP

(Single Super Phosphate) directly obtained from the TCG.

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Mediterranean Food Industries: MFI is a fully exporting company, which started on May 7,

2007; its export turnover has progressed gradually. MFI, employs more than 200 people including a

large number of graduates,it exports to more than 20 countries in North Africa, Europe, Asia, Middle

East. The company’s major products are Bi calcium phosphate 18, mono dicalcium phosphate 20/20

and mono-calcium phosphate. All of which are used in the animal nutrition sector. MFI is an

innovative company that holds its own patent in phosphate processing and can be considered as a one

of a kind in the Mediterranean basin.

b. SME’s and linkage industries

This category of industries play an important role within the cluster. They provide vital services and

products to the existing heavy industries. Their existence and prosperity rely essentially on the

functioning of the surrounding industries. Although some of them do not only interact with

companies from inside the cluster, all of the enterprises cited below network with its surround ing

cluster neighbors. They can be categorized by their production sector as follows

Energy

STEG: Central power plant and a liquefied Gas & Petrol station for hydrocarbon storage and

diffusion. Since the TCG produces its own energy, STEG buys excess electricity produced by the

Chemical Group and they rely on each other in case of failure.

SAGAZ: specialized in the compression and distribution of Butane and Methane gas for domestic use.

SAGAZ is a private commercial agent that interacts with STEG GPL.

Construction

2A2M, BMS, EMO, ETIP, G2I, GTI, LES TROIS, SGTI, SEEMIM, SIS, SOMATEC,

STSI: These companies are specialized in providing construction services for industrial installat ions

such as: reservoir construction, steel welding, piping, mechanically welded structures, industrial steel

plants…

SOMATRASM: specialized in maritime and hydraulic works, the company provides services for the

commercial port of Gabes such as sediment dredging, underwater works and canalizations.

Sud Bitume: created in 1993 is a company specialized in manufacturing and marketing of

bituminous products located in Gabes.

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Maintenance, Transport and Industrial services

- ELENCO, Sti EZZI maintenance, GMS, Ste Hajjaji Issam, S2M, SOSIS, SEZAG: Installation,

inspection and maintenance of industrial equipment.

- SOHATRAM, SGTM, GTSP, HFTS, STTV, and YAHYA Transport: merchandise

transportation services for various industries.

- MFGT: they specialize in Industrial maintenance and assembly of factories, Electrica l

maintenance, Manufacture of railway equipment, manufacture of containers, metal frames.

Environment

- SOTUGED: Specialized in diverse industrial waste management and valorization.

c. Industrial & Technological pole of Gabes

The very existence of the pole plays a deterministic role in boosting the region’s competitiveness.

Created in 2010, the company aims to strengthen the regional and national economy through

technological content that is innovative, friendly to the environment and economical in terms of

energy. Politech-Gabes is a public private partnership (PPP) under the legal form SA (societé

anonyme) and it holds a share capital of 5 million dinars. POLITECH Gabès, directs its missions &

projects to the following Strategic Intervention Areas (DIS):

Eco technologies (Water, Chemicals-Environment and Waste Recycling).

Renewable Energies.

VALORIZATION OF RESOURCES (Useful substances, products of the Oasis).

Building materials, Building materials.

GEOTHERMIA applied to agriculture.

Promotion of ITC, logistical services, handicrafts & eco-tourism.

Although the pole’s work is quite recent and cannot be measurable to some extent, promising

initiatives are being made showing proof of good scientific policy practices. The poles identifies the

region’s strengths and weaknesses and works toward building a regional knowledge economy through

various tools and programs.

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Figure 7 Politech Gabes Network of Associates

Activities

Creating a collaborative platform for innovation & development -MED OASIS VALLEY network:

The pole creates a network between enterprises, project idea holders, R&D institutions and the

support structure. This facilitates startup creation through positive networking of the entrepreneur and

major partners (universities, support structures and industrialists). It also offers the opportunity to

register with the Idea Generation Club and participate in the Best Innovation Project in Gabes" contest.

Finally, it enables project idea holders develop research projects with high economic spin-offs, up to

their phase of Industrialization and marketing.

Innovation and technological transfer: the pole offers the following services to enterprises and

entrepreneurs in the region:

- Identify and formulate needs in terms of technology.

- Transform ideas into innovative projects in collaboration with partners (Laboratories and research

units, technical centers ...).

- Identify and mobilize partners and funding.

- Promote R&D results to the industrial world.

- Set up and manage collaborative projects aligned with strategic axes.

Politech-Gabès has set up a strategic monitoring system that aims to Collect, process and dissemina te

relevant information to MED OASIS VALLEY network, strengthen the synergy of our network by

bringing together companies, project promoters, academic institutions able to generate ideas for

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collaborative projects eventually fueling the innovation process and keeping pace with the strategic

axes of the cluster.

Cluster support: mobilizing and networking scientific expertise, entrepreneurs within the network

is the main approach that Politech-Gabes adopts for cluster animation. Round tables and

brainstorming activities have produced tremendous flux of innovative ideas and projects to be built

in the future that strengthen up the cluster’s integrity.

Development of industrial zones: Politech-Gabès Industrial and Technological Pole has 4 support

sites currently being finalized. Each site is composed of a production area and a living center.

- El Hamma (15 Ha)

- Menzel Lahbib (9 Ha)

- Matamata New (25 Ha)

- Bouchemma (10 Ha)

d. Local Government intervention

The local government specified advantages of regional development in Gabes in the delegation

of El Hamma, Menzel El Habib, New Matmata and Matmata classified as priority regional

development zones:

- Investment premium waiver: 25% of total investment, including working capital with a limit

of 1,500,000 DT. For new promoters this waiver is 30% with a limit of 2,000,000 DT.

- waiver for state participation in infrastructure expenditure: 85% of the amounts committed to

the company.

- Contribution to the employer's to the statutory social security scheme Payment (CNSS): State

support of this contribution during the first ten years from the date of entry into actual activity.

- For services related to culture: creation of a theater company: 8% of project cost waiver

excluding cost of land.

- For leisure-related services: (Recreation parks for families and children - Residential and

camping centers - Recreation parks): 15% of project cost waiver excluding land

For the Mareth delegation classified in the regional development zone of the 2nd Group:

- Investment premium: 15% of total investment, working capital included with a limit of

1,000,000 DT.

- Waiver for state participation in infrastructure expenditure: 75% of the amounts committed to

the company.

- Contribution to the employer's to the statutory social security scheme Payment (CNSS): State

support of this contribution during the first five years from the date of entry into effective

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operation and a share of that contribution for an additional period of five years fixed as

follows:

Tableau 2 State support shares to employer's CNSS payments, delegation of Mareth

Year concerned with state support State support share

First year 80%

Second year 65%

Third year 50%

Fourth year 35%

Fifth year 20%

Projects: “Primeurs du Sud” A new Cluster "Primeurs du Sud" was initiated by Politech Gabès with the support of PASRI and is

part of the national strategy of the Ministry of Industry for the development of the clustering approach

in the potential territories of Tunisia. This cluster was created in Gabes in the form of an association

of Tunisian law, on October 6, 2015, on the initiative of 13 founding members composed of: 6

companies (Zina Fresh, Sanlucar, DesertJoy, Server, Gaprim, GeoProduction) , 4 farmers, includ ing

2 members mandated by about 20 farmers operating in geothermal early-growing crops in Elhamma

Gabès and 3 associated organizations (Politech Gabès, URAP and CTCPG). Driven by the will to

sustainably utilize the geothermal potential of Gabes in the agricultural sector, the cluster emphasizes

on the networking of companies and farmers working in the field of early cultivation, and having the

will through the "cluster" concept. The aim is to jointly develop new markets, both local and export,

and to participate in various joint projects aimed at improving productivity, quality, competitiveness

and innovation for the benefit of cluster members.

22

Figure 8 Hierarchy of the Bouchemma industrial cluster

Figure 9 Enterprise distribution by sector in the industrial cluster of Gabes-Bouchemma

33%

22%

22%

2%

21%

Enterprise distribution by sector

Construction

Transportation

Installation, Inspection andMaintenance

Environment

Large industries

23

Recommendations & General Conclusion

The implantation of the first Tunisian Chemical Group production units in Bouchemma-Gabes

triggered a domino’s effect in terms of business creation. The existence of the first industr ies

opened opportunities for entrepreneurs in various sectors thus producing the detailed outline

above. However, the regional cluster still needs further improvements. In order to enhance the

competitiveness of the cluster, the following recommendations are formulated:

R&D has so far not been a focus of the cluster until lately. However, in order to make the

cluster more competitive and make it harder for other competing countries such as Morocco,

Gabes should invest in R&D (starting with applied R&D) and incentivize entrepreneurship .

Gabes should therefore strongly support the development of research institutes in partnership

with foreign companies and universities. Public funding should be provided with transparency

on the outcomes. Commercialization of innovations should be made through start-ups

incubated by these research institutes.

Almost a third of the PME’s installed in the cluster (33%) are in the construction industry ,

particularly industrial construction. Not to mention the existing civil engineering and

construction related enterprises anchored and operating in the region. Gabes today stands as a

vital linkage point for southern Tunisia providing material and construction services for major

construction projects for Gabes, Medenine, Tatouine, Tozer.. This is industry has been rapidly

growing and that is a major strength of the region. It can be explained by the knowledge and

expertise gained by local entrepreneurs from previous experience in large construct ion

companies (Bouchemaoui industries, Ben kilani enterprise...) whom are installed and

operating in the region for a decent period of time. Furthermore, the abundance for natural

resources and the strategic location of Gabes in the national map has made it an ideal business

opportunity for cement and cement related products, quarries, civil engineering entrepreneurs

and so on…This sectarian growth can be boosted and exploited, using the same cluster

approach, by creating a construction cluster in the region, defining the industry as a major axis

for R&D and incentivize innovation through adequate Sciences, Technology and Innovation

policies and practices in order to make the region stand as a leading pole for construc t ion

services on a regional, national and even international scale.

Facilitate and support the development of ICT companies intending to install in Gabes region

and develop a competitive offer in the field of ICTs to meet the demand of local and nationa l

companies and institutions.

24

References

San Diego Association of Governments. Understanding Cluster Analysis.

www.sandag.org/rta/transfer/industrial_clusters.pdf

Maryann P. Feldman, Johanna Francis. Entrepreneurs and the Formation of Industrial

Clusters. www.cs.jhu.edu/~mfeldman/Feldman%20-EFIC.pdf

Micheal Porter (1998). Clusters and the new economics of competition, Harvard

Buisiness Review. https://hbr.org/1998/11/clusters-and-the-new-economics-of-competition

Benjamin Maturana, Kinley Salmon, Juan Espinosa, Ruben Brekelmans (2015). The

Automotive Cluster in Morocco. Competitiveness and

recommendations for future growth: Harvard Business School.

Tunisian Chemical Group official website: http://www.gct.com.tn/