Algeria Economy

As they are throughout North Africa – and indeed, much of the emerging world – subsidies remain a major driver of fiscal expansion in Algeria and have become a balancing act between minimising hardship for lower-income groups and avoiding a large rise in fiscal deficits. Algeria is luckier than most countries, with significant hydrocarbons revenues...

Among the important benefits that have made Algeria keen to attract foreign direct investment (FDI) is access to foreign technology and know-how to boost local industry. However, current FDI levels remain low, stymied in part by perceptions that it is difficult to do business in Algeria. There have been calls for changes to measures introduced...

exchange expanded to almost $5bn in 2011 and stands to increase further, as Algeria concluded a free trade agreement (FTA) with Brazil in February 2012.

RAPID RISE: As elsewhere in Africa, however, it has been China that has risen through the ranks the fastest. The Asian giant has played a key role in...

Oil and gas production continues to dominate the Algerian economy, accounting for almost all of exports, close to half of government revenue and over a third of GDP. In recent years non-hydrocarbons GDP has outstripped wider economic growth, though this is largely driven by public spending rather than private sector activity.

Ties between Algeria and the EU are of key importance to both the North African republic and Europe. The EU is Algeria’s most important trading partner by a wide margin, and Algeria represents a crucial supplier of energy, in particular of natural gas, to the bloc. Highlighting the importance of these links, in November 2012, EU High Representative...

After achieving independence in 1962, following a long struggle with France, Algeria found itself in a difficult position: it produced only modest amounts of oil, had limited infrastructure in rural areas, grappled with unemployment in excess of 70% and was devastated by the conflict with its colonial ruler.