On boosting Algeria’s potential to export technology to new markets
How would you assess Algeria’s digital infrastructure and what role can public-private partnerships play in enhancing it?
ALI BOUMEDIENE: There has been much improvement in Algeria’s digital infrastructure in the last two decades. This has been accomplished in spite of, rather than because of public-private partnerships, as the private sector has been driving innovation in local technology activities. Much of this has been the result of international partnerships between private entities, such as Chinese and Japanese firms.
In recent years Algeria has become more than an importer of finished goods; now we are capable of research and development, product design, manufacturing, sales and export. An example of this is the manufacturing and sale of TVs. On the supply side, the world leader is Samsung, which produces nearly 70m devices, followed by LG and other large brands.
On the demand side, the Algerian market consumes fewer than 1m units, versus a global annual consumption of 220-230m units. Between these two forces, there is an opportunity for Algerian technology companies to form part of the global supply chain in the international TV market, as local companies have expertise in handling semiconductors, microprocessors and other technologies. They can increase sales volume through upscaling and improve intellectual autonomy by investing in home-grown research and innovation. To achieve this, companies need to form solid partnerships to create a new vision for Algeria’s modern technology ecosystem.
What is your evaluation of Algeria’s local content capacity and participation in the technology sector?
BOUMEDIENE: Algeria’s value proposition centres on its position as a bridge between North Africa and Europe, a market with almost 680m people. Europe is a key market for Algerian businesses and serves as a testing ground for products so businesses can have confidence in introducing them to African consumers.
Algeria is a young country; more than 60% of the population is under the age of 30 and the country has more than 600,000 university graduates. Although the workforce is somewhat less qualified compared to other markets in the MENA region and there is still much work to be done to improve the overall skill level, productivity and competitiveness of our labour force, policymakers understand the need to invest in higher education. International partnerships whereby other companies and organisations from overseas share knowledge and technology locally are at the centre of this development.
To what extent is investment in education and training key to engendering technology independence?
BOUMEDIENE: Education and training is vital for technology independence, particularly in terms of bolstering the capacity of future engineers through master’s and doctorate programmes in electronics. With the combination of comprehensive training, solid partners and new technology, Algeria can leverage its knowledge, tech-based economy to boost value-added exports and therefore integrate itself more closely into global value chains in the technology sector.
One technique is to utilise an incubator-style format, where a compact research laboratory reimagines a product, leverages its resources to introduce this product into the global market, and initiates an additional privately-driven programme for educating and tapping into the creative potential of young individuals. This strategy aims to enhance the nation’s workforce capabilities in the electrical engineering and ICT fields.
In what ways is international logistics infrastructure fostering regional trade for Algeria-based companies in the sector?
BOUMEDIENE: We can all benefit from increased trade and greater integration of supply chains, especially within Africa. Other French-speaking markets in West Africa such as Senegal and Côte d’Ivoire are attractive options for trade and investment.
However, for the moment there are still barriers to overcome in terms of logistics. The two countries are strategically located to distribute to other members of ECOWAS. However, Algerian firms find it more convenient to ship goods to these countries through Europe due to the absence of direct logistical routes from Algeria to Senegal or Côte d’Ivoire. This not only makes it time-consuming, but also expensive to do business with these markets.
It is another example of the need to ensure connectivity with other parts of the world, including sub-Saharan Africa, Asia and the Americas. Better logistics connections will make Algerian products more accessible, less expensive and more competitive in the global marketplace.
