The first hotels in Algeria were built by the state in the 1970s, but poor management and depressed demand in the 1990s have caused the sector to suffer from a shortage in quality lodgings. Out of the 94,000 existing beds, only 20% currently meet international standards. “Boosting quality infrastructure and services is a must if Algerian tourism is to thrive,” Abdelkader Gouti, the director of communication and cooperation at the Ministry of Tourism, told OBG. Therefore, to meet modern tourists’ needs, AD70bn (€672m) will be spent to upgrade and modernise infrastructure in the hospitality sector under the Quality Tourism Plan Algeria (Plan Qualité Tourisme Algérie, PQTA) launched in 2009 to deliver quality hotels and services.
UPGRADES: Plans are ongoing to upgrade state-owned hotels, which total over 60 at present. The Aurassi Hotel in Algiers was the first to undergo renovation works, opening its doors again in March 2012. Gestour (Société de Gestion de Participation de l’Etat du Tourisme), the company responsible for the management of state tourism participation, is tasked with ensuring the gradual privatisation of these hotels. It launched several international tenders in 2008, but these were unsuccessful due to the lack of available capital.
However, to overcome the shortage in bed capacity, especially along the coast and in the Sahara region, more hotels need to be built; an activity from which the government withdrew to allow for more private participation. Consequently, various legal and fiscal incentives have been introduced under the National Tourism Development Plan and the 2009 Complementary Finance Law. As a result 763 projects have so far been approved, which are expected to boost bed capacity by 86,000 over the next four years.
LOCAL PARTNERS: Taking into account that foreign investment must be realised together with an Algerian partner that has a minimum 51% share, international hotel brands have partnered with local companies for all new greenfield projects. Dutch-based Golden Tulip and Algeria’s Ramdane Group signed an agreement to open a five-star Golden Tulip hotel in the coastal town of Skikda. The 247-room establishment is expected to be completed by 2013. Holiday Inn Algiers-Cheraga Tower, the InterContinental Hotels Group’s first hotel in Algeria, is expected by 2014 and will be developed in partnership with Algeria’s Ramdane Group, offering 243 rooms and 500 sq metres of meeting space.
France’s Accor and Algeria’s Société Immobilière et d’Exploitation Hôtelière Algérienne (SIEHA) have partnered to invest AD30bn (€288m) into constructing over 20 hotels nationwide belonging to its Novotel and Ibis brands. SIEHA and Accor have already opened an Ibis in both Oran and Tlemcen.
Constantine also counts one Ibis and one Novotel, with a total capacity of some 288 rooms. More plans are in the pipeline, with three hotels to be built in the southern towns of Adrar, Tamanrasset and Hassi-Messaoud, as well as two Ibis and Novotel hotels of 240 rooms in Sétif, one Ibis with 150 rooms in Skikda and a Novotel with 250 rooms in Algiers.
ZETS: These projects are most likely to take shape in the country’s tourism investment zones (zones d’ expansion touristique, ZET), which are dedicated solely to tourism-related projects in designated areas of land which have natural and cultural qualities, disposable labour and are suitable for infrastructure development.
There are 250 ZETs in Algeria, covering a total surface area of more than 53,000 ha. Over half of these are located on the coast. El Aouana ZET, for instance, in the coastal wilaya (province) of Jijel, covers 167 ha and has been chosen as a pilot zone out of the 19 ZETs in the wilaya. It will bring the development of two- to four-star hotels and generate more than 6500 jobs.
The arrival of international hotel brands will have an impact not just on the quality of infrastructure but also on services delivered in the hospitality sector, which currently suffers from a lack of qualified personnel. Under the PQTA, the government insists that investors ensure regular in-house training sessions and, most importantly, the transfer of know-how in hotel management.
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