Eighteen months after prompting the onset of the Arab spring, Tunisia still can boast of an ongoing, successful transition. The former regime, which stood for corruption and social injustice, is gone and democratic gains are palpable. Yet, formidable social and economic challenges threaten to halt progress. Among these challenges, three stand out: rising unemployment – particularly of university graduates – stark regional inequalities and corruption. Although the unity government led by the Islamist An-Nahda party is aware of these social and economic ills, it so far has been unable to address them rapidly enough and is failing to quell the impatience of workers and unemployed youth who expect to reap the fruits of their involvement in past struggles. To avoid destabilising social conflicts, the government needs to better respond to the escalating violence caused by worsening economic conditions; get a handle on the large informal economic sector, including smuggling; overcome administrative bottlenecks that hamper socio-economic improvements; and foster democratisation at the regional and local level.

Despite a gloomy global environment and a revolution that was economically devastating for the country, state and society so far have held on. Financial institutions are functioning properly, companies are operating and tourism, although hit hard, has shown signs of recovery. The predatory practices of the families of the deposed president and his wife now feel like ancient history.

Yet, under a veneer of normalcy that should be the envy of other Arab nations mired in bloodier and shakier transitions, economic grievances are churning right below the surface. They could once again reach full boil. The economic and social causes that sparked the uprising a year and a half ago are far from resolved or even adequately addressed or discussed. Millions of Tunisians went to the polls in October 2011 hoping for quick relief from their daily struggles. Since the elections, even if one segment of the population has expressed its disenchantment quietly, another is mobilised and ready to fight. Because the latter comprises Islamists and secularists, professionals and labour activists as well as citizens expressing ordinary resentments, their behaviour often is marked by a spirit of every man for himself.

Although a succession of caretaker governments maintained a degree of economic peace by resorting to emergency measures, Prime Minister Hamadi Jebali’s government, which took office in late December 2011, has inherited a worrying economic situation which increases the risks of social and economic unrest. What is more, it took over a state whose presence and reach in the country’s hinterlands is feeble and which has proved incapable of curbing corruption, the violent renegotiation of power at the local level, the burgeoning informal economic sector or the proliferation of smuggling networks which fuel inflation. Despite the prime minister’s optimism, these problems are ever present and the government’s margin of manoeuvre is narrow. This is illustrated by bureaucratic inertia that impedes the government as well as by the abundance of sit-ins and protest movements of all kinds that seem to chip away at its credibility and further delay return to a more peaceful economic situation.

In order to restore socio-economic stability, the state must address social concerns without stirring up new demands that will further undercut the ability of the business sector to function effectively. Although it has improved its rhetoric to some degree, the government’s at times threatening remarks towards demonstrators – more often than not unemployed youth from disadvantaged areas – has exacerbated the situation.

The tasks at hand are enormous. The government needs to maintain an increasingly fragile peace, keep a complicated political transition on track and regain the confidence of local communities, whose inhabitants measure progress primarily by material improvements. And all of this must be done in an increasingly polarised political environment. The Troika in power indeed is criticised by both parliamentary and extra-parliamentary secular opposition forces and challenged by a more hardline Islamist movement, which, under the guise of Salafism, could further radicalise many who feel marginalised and excluded.

In the absence of short-term progress, the growing impatience could express itself in various ways. Already, clan-based violence has claimed more than a dozen lives. Local economic and political relations are being restructured in sometimes dubious and opaque ways. This is occurring precisely at a time when the central state has failed to restore its authority in several regions – indeed, it appears to be limping along ever since the dissolution of the omnipotent former ruling party. Corruption persists and provokes discontent and indignation.

It would be exaggerated to raise the spectre of a second insurrection. The main mass organisations, namely the General Tunisian Workers Union (UGTT) and the An-Nahda party, are not itching for a political showdown. The various political parties appear to accept the democratic rules of the game and are seeking to reposition themselves on the political playing field ahead of presidential and parliamentary elections. However, socio-economic insecurity and political instability, inextricably linked in this post-revolutionary context, negatively feed on each other and risk snowballing into a legitimacy crisis for the newly elected government.

In this new phase of the transition, the government ought to prioritise job creation for young graduates, regional development and active support for those who are part of the informal economy. One of the keys to success almost certainly will lie in greater consultation and dialogue with various stakeholders. After decades of top-down decision-making, and in light of the enormous socio-economic problems they will face, Tunisians deserve no less.

Tunis/Brussels, 6 June 2012