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The high food import bill, a growing population and effects from climate change are behind Algeria’s drive to increase local food output. Food production improved between 2007 and 2018 thanks to efforts to clear some of the obstacles that have traditionally hindered the sector’s development, such as financing, legislation, insufficient infrastructure and land ownership. While the record cereals harvest was a highlight of 2018, Algeria is still quite a way off from significantly reducing its import bill for food products. However, great gains wait to be made with the wider application of irrigation and mechanisation, in addition to ensuring underutilised land is reallocated to players who will develop it to its full potential. This chapter contains interviews with Nabil Assaf, Representative, Food and Agriculture Organisation of the UN; and M’hamed Metidji, CEO, Metidji Group, and President, National Interprofessional Council for Cereals.

The industrial sector is seen as having potential to drive economic diversification and reduce the import bill. In addition to heavy industrial subsectors such as steel and cement, pharmaceuticals, agri-business and automotive manufacturing hold promise in becoming key exporters. For the sector as a whole, and particularly for small businesses, investment in logistics and transport capacities will be crucial to building a local ecosystem that is robust enough to position industry as a key driver of growth. In addition to its hydrocarbons wealth, Algeria is rich in a variety of minerals, such as phosphate, gold, iron, zinc, lead and others. These ores are still largely untapped, but the diversification drive deployed by the government to reduce the country’s reliance on oil and gas and direct it towards more sustainable growth could lead to greater development of this heretofore marginal industry. This chapter contains an interview with Amara Charaf-Eddine, CEO, Madar Holding.

Despite being rich in fossil fuels, Algeria faces challenges in its utilities sector in terms of distribution and efficiency. While the provision of electricity is a non-issue – though sustainable generation notably is – the rate of household connections to the natural gas network is in need of improvement, especially outside major cities. Drinking water is largely secure, yet business needs are straining resources, prompting increases in desalination and wastewater treatment. Future investment opportunities in the utilities sector are set to be focused on rural gas needs, green electrification and unconventional water resources. This chapter contains interviews with Mohamed Arkab, CEO, Sonelgaz; and Hocine Necib, Minister of Water Resources.

The steep fall of oil prices in 2014 underlined the extent to which the Algerian economy, already under pressure from growing domestic demand for energy and decreasing output, was dependent on hydrocarbons. Algeria is now facing the challenges of reforming and revitalising this strategic sector and, through state-owned energy company Sonatrach and its SH2030 Leading the Change strategy, is giving shape to long-term developments in offshore and shale. Renewables, meanwhile, are set to become an increasingly prominent component of the energy mix. While diversification will need to remain a top priority to avoid economic crises such as that of the 2015-17 period, energy will remain the most prominent sector for the country in the long run. This chapter contains interviews with Abdelmoumen Ould Kaddour, CEO, Sonatrach; Claudio Descalzi, CEO, Eni; Hesham Mekawi, Regional President, BP North Africa; and Fatma Zohra Zerouati, Minister of Environment and Renewable Energy.

The decision by authorities to embark on a programme of monetary financing towards the end of 2017 marked somewhat of a turnaround in a difficult year for Algeria’s banks. A competitive dynamic has remained in recent years, with no new entrants, exits, mergers, acquisitions or privatisations of note. Efforts to improve financial inclusion are under way, however, attempts to grow the banking sector through the mobilisation of domestic resources have been dampened by Algerians’ strong cultural preference for cash and a certain distrust of financial intermediaries. Over the medium term, the end of the monetary financing programme has the potential to add impetus to capital market development, as it is likely to be accompanied by a tightening of bank liquidity and a need for public and private sectors alike to explore alternative sources of funding to bank lending. This chapter contains interviews with Mohamed Loukal, Governor, Bank of Algeria; Brahim Semid, CEO, Banque Extérieure d’Algérie; and Lazhar Sahbani, Partner, PwC Algeria.

As Africa’s most important gas exporter, Algeria remains highly dependent on the hydrocarbons sector for the majority of government revenues and almost the entirety of its exports. Despite reforms to encourage private sector development, promote diversification and attract foreign direct investment in recent years, the state plays a preponderant role, meaning that expenditure and investments continue to have a significant impact on overall economic performance. The drop in global oil prices since 2014 is at the root of Algeria’s most recent economic challenges, giving rise to large twin deficits in the fiscal and current accounts. The strategy embarked by the authorities in late 2017 has brought some relief to Algeria, though the sustainability of this approach rests on the adoption of necessary corrective measures from 2019 onwards. This chapter contains interviews with Abderrahmane Raouya, Minister of Finance; Richard Lesser, CEO, Boston Consulting Group; and Ali Haddad, President, Algerian Business Leaders’ Forum.