Moises Saman for The New York Times
People in Tunis and across the country are struggling with high unemployment and inflation.
TUNIS — Tahar Bayahi, who runs Tunisia’s largest grocery store chain, spent the days right after the revolution toting up his losses: one-quarter of his 60 stores nationwide incinerated and another quarter pillaged.
Yet his company, Magasins Général, turned right around to rebuild, pouring $40 million and nine months into the effort. “It’s true that we were badly affected, but it opened up a far larger horizon,” Mr. Bayahi said over lunch on a sunny lakeside terrace. “What was important was that the change would bring us to a new epoch much faster.”
Nearly two years after riots that began over economic frustration and unemployment toppled the Tunisian government and started the Arab Spring, the frustration that people here are not better off is starting to overflow again. The gross domestic product is down, unemployment is up, debt and inflation are growing and social unrest simmering.
Last week, the government sent troops into Siliana, south of the capital, after four days of violent protests, mainly over demands for jobs and more government investment, turned violent. Thousands participated and hundreds were injured in clashes with the police.
President Moncef Marzouki, acknowledging Friday on television that the government had not “met the expectations of the people,” expressed concern that unrest could spread to other towns in the underdeveloped interior.
“Tunisia today is at a crossroads,” he said. “Tunisia today has an opportunity that it must not miss to be a model because the world is watching us, and we mustn’t disappoint.”
Unemployment remains the biggest economic problem and catalyst for unrest. A vicious circle imperils all the Arab nations with unfinished revolutions: political unrest scares off the investors needed to create jobs.
Since President Zine el-Abidine Ben Ali was ousted in January 2011, the unemployment rate has risen to 18 percent from 13 percent, meaning about 1.8 million people are out of work.
More troubling, a third of the unemployed are college graduates, according to Said Aidi, minister of the economy for much of 2011. By 2015, an estimated 100,000 new graduates will seek jobs annually, while even before the revolution at most 20,000 graduates a year found work matching their degrees.
“Ben Ali ignored the blinking red lights on the economy, and that is what got him thrown out,” said Karim Ben Smail, the owner of a modest publishing company. “The unemployed are an army in a country the size of Tunisia.”
The numbers are not all bad, however. The economy contracted by 1.8 percent in 2011, beset by problems like a 30 percent drop in the number of tourists, according to the World Bank. It predicts 2.2 percent growth this year, however, and a close-to-normal 4.6 percent by 2014 should conditions stabilize.
But a new constitution has yet to be written, and elections have been postponed until at least next June. Periodic riots — especially the sacking of the United States Embassy in September in response to a video made in the United States mocking the Prophet Muhammad — have left investors sitting on their wallets and kept tourists at home. A State Department travel advisory warned Americans against visiting Tunisia.
Bracing for further unrest, Magasins Général rebuilt its stores with shatterproof glass, heavy metal shutters and 20-foot walls topped by barbed wire.
Before the revolution, the company felt disadvantaged because its closest competitors, franchises of the giant French retailers Carrefour and Monoprix, enjoyed closer ties to the ruling family, Mr. Bayahi said. Both opened superstores while his applications languished.
After the revolution, he expected permits to sail through, particularly since his two proposed superstores meant more than 1,400 jobs. Instead, officials tell him “it is being studied,” just like before the revolution, he said.
While Mr. Bayahi blamed a combination of government incompetence and foot dragging for the delay, economic experts cited an additional reason. Small neighborhood shops potentially hurt by big chains extend credit to poor customers, helping to maintain social peace.
