Global Journal of Economic and Finance Research

Despite ongoing efforts to diversify its economy, Tunisia’s agricultural sector remains a cornerstone for employment, food security, and rural development. However, its vulnerability to macroeconomic shocks—particularly exchange rate fluctuations—raises critical concerns about the sector’s trade performance and long-term competitiveness. This study empirically investigates the impact of exchange rate movements on Tunisia’s agricultural trade balance over the period 1981 to 2015. Employing a multiple linear regression framework, the analysis integrates key macroeconomic indicators, including real exchange rate fluctuations, GDP growth, global agricultural prices, and domestic agricultural output. The findings reveal a statistically significant negative relationship between exchange rate depreciation and the agricultural trade balance, indicating that currency weakening has eroded rather than improved trade competitiveness—likely due to the sector’s reliance on imported inputs and limited export diversification. Additionally, rising world agricultural prices are found to exert a negative influence, suggesting that global price increases disproportionately affect input costs. In contrast, GDP growth and domestic agricultural production have weaker or statistically insignificant effects, reflecting structural inefficiencies and a muted supply-side response. These results challenge the conventional assumption that exchange rate depreciation benefits agricultural exporters and underscore the importance of context-specific factors in shaping trade outcomes. The study concludes by recommending targeted investments in agricultural infrastructure, trade logistics, and policy coordination to strengthen Tunisia’s agricultural resilience amid ongoing exchange rate and global market volatility.

Exchange rate fluctuations, Agricultural trade, Tunisia, Trade balance, Currency depreciation, Macroeconomic policy

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