Algeria has long had complicated foreign relations, having tense ties with neighbouring Morocco, which has held back regional integration, while at the same time having strong trade relations with the EU, with which it signed a free trade accord in 2002. However, its international profile is in the midst of a gradual shift, as it seeks to reduce industrial imports from traditional trading partners,…
Given that Algeria’s hydrocarbons sector accounted for more than half of government revenues in 2014, it is hardly surprising that the collapse in oil prices from 2014 onward has hit public finances. From 8% of GDP in 2014, the deficit ballooned to 15.8% in 2015, before moderating to an estimated 14% in 2016. Algeria was able to postpone the bulk of the necessary adjustment in the public…
Small and medium-sized enterprises (SMEs) predominate among Algerian firms, forming the backbone of the private sector. At end-2016 Algeria’s 1m SMEs employed more than 2.5m people and engaged in some AD75bn ($622.1m) in bilateral trade. According to the Ministry of Industry, Algeria created an average of 60,000 SMEs per year in the 2012-15 period, and there is evidence that the pace of business…
Capital markets represent a financing alternative for Algerian companies, especially considering the current economic trend marked by a decrease in liquidity and foreign currency reserves. The stock market will simultaneously provide non-inflationary financing means to economic agents and have better savings yields. Currently, the Algerian stock market faces difficulties with development despite…
The oil price-induced economic difficulties facing Algeria may prove to be a double-edged sword: although the added pressures are certain to slow the rate of improvement in living standards and have already begun to strain public finances, the new circumstances also provide a pressing incentive for the country to slowly wean itself off its hydrocarbons dependency develop a more dynamic private…
Before 2014 the only domestic vehicle manufacturer was the state-owned Entreprise Nationale des Vehicules Industriels (SNVI), which was established during colonial times and produces commercial and heavy vehicles. However, in 2014 Renault Algérie Production, a joint venture between SNVI, Fond National d’Investissement and French carmaker Renault, launched an assembly plant near Oran. Initial…
One of the largest manufacturing segments in Algeria is construction materials, which accounted for 2.2% of total country GDP and 10.4% of industrial GDP in 2016, with value added of AD101.3bn (€840.2m), according to the National Statistics Office. In 2016 segment GDP grew by 6.2% in real terms – up from 5.1% the previous year – making it the second-fastest-growing industrial segment,…
The rapid rate at which urban areas in Algeria are developing has led to road congestion and growing transport demands. To tackle challenges constraining traffic flow in cities, the government has invested in urban transport solutions over the years. The country launched the region’s first metro line in Algiers in 2011, installed tramways and has a dense network of bus lines. Metro Reach The…
Customs procedures in Algeria are often associated with high storage costs and bureaucratic constraints that affect distribution, leading to underperformance. Whereas the country possesses 11 commercial ports along its 1200-km coastline, most of them lack storage capacity, and face infrastructural and equipment deficiencies that make them unable to achieve a dynamic flow of freight distribution. With…
Advances in the digital environment have been key to Algeria’s recent rise in global economic and development indices. The country was named the “most dynamic” Arab market in the ICT Development Index 2016, released by the UN’s International Telecommunications Union, rising nine places to 103rd out of 175 countries. Algeria has prioritised IT and ICT enhancement as a cornerstone of…
