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Despite its unique natural and historical heritage, Algeria’s tourism sector has long struggled to transform into an important component of the country’s economy. Nonetheless, new government incentives, along with private initiatives to expand existing hotel capacity, are helping to modernise the sector, which has historically been sidelined by government focus on other economic activities. Although Algeria is in a prime location to attract many tourists, the country has sought to avoid mass-market tourism in an effort to maintain high-quality offerings. The role of the tourism sector in the economy is expected to continue on an upward trend, although this evolution will most likely happen at a slow pace. As Algeria aims to attract more travellers from traditional markets such as France, Spain or Germany, it will be competing with more developed destinations such as Egypt, Tunisia and Turkey. This chapter contains an interview with Frtiz Van Paasschen, CEO, Starwood Hotels and Resorts.

Although agriculture’s contribution to GDP had dipped slightly from 10% in 2012, domestic output is on the rise. The Ministry of Agriculture and Rural Development estimates that the value of agricultural production increased five-fold over the last 15 years, from €4.65bn in 2001 to €23.81bn in 2013. The government has made it a priority to boost domestic production to reduce its ever-rising import bill and end the country’s reliance on imports of dietary staples such as cereals and milk. Government efforts to subsidise fertilisers, certified seeds, machinery and irrigation equipment have helped to modernise the sector. The presence of private agro-industry groups should further help to carry this effort onwards and increase productivity going forwards. This chapter contains interviews with Abdelwahab Nouri, Minister of Agriculture; and Hocine Mansour Metidji, CEO, Group Metidji.

The telecoms market in Algeria has shown dynamic growth in recent years; as with many emerging markets, the mobile penetration rate has gone from zero to nearly 100% in less than 15 years and the market has demonstrated strong demand for new technologies. The long-awaited launch of 3G services in December 2013 has helped to develop new sources of growth in an increasingly saturated sector. The modernisation of sector regulation will be necessary in order to encourage further investment in this key market, which may provide the boost legislators need to restart work on the new ICT law. The introduction of 3G mobile services in December 2013, followed in May 2014 by state-owned operator Algérie Telecom’s (AT) 4G fixed wireless data service, stand to significantly impact the IT sector in the near term, particularly in terms of consumption and demand. Private sector operators estimate that the IT sector contributes 1.3% of GDP, compared to 3.3% for the telecommunications sector. In the short term, AT will focus on deploying fibre-optic and wireless internet infrastructure, which will help to strengthen Algeria’s nascent digital economy. This chapter contains an interview with Joseph Ged, CEO, Ooredoo; and a viewpoint from Mourad Nait, Country General Manager, Microsoft.

As a result of high oil revenues over the past decade, Algeria’s transport infrastructure has been significantly overhauled, benefitting from generous public sector spending. During the 2010-14 period, the government allocated €30.1bn to be used for road expansion and maintenance, as well as improvements in port infrastructure, with an extra €27.2bn invested in the railway sector and air transport infrastructure. This sort of capital-intensive spending is likely to continue, even as the state sees a drop in oil revenues, its primary income. More crucially, the government is gradually shifting attention to soft infrastructure to ensure that processes and execution keep pace with capacity upgrades. This chapter contains an interview with Amar Ghoul, Minister of Transport.

Benefitting from the government’s push for transport infrastructure and public housing, and guided by a new capital-intensive five-year plan, the construction sector has been seeing constant activity. During the 2009-14 five-year period, authorities channelled $286bn to modernise transport infrastructure, expand energy production and improve urban housing. However, while the demand for construction materials and expertise is high, contracts have faced operational constraints. Despite these difficulties, Algeria’s comparative stability in the region continues to garner international interest for a host of development projects that will cover areas such as road and rail construction, energy production and water infrastructure. As the government channels state funds into its public housing programme, growing private interest is stoking growth in the higher-end residential segment of Algeria’s real estate market along with office and commercial real estate. One positive aspect of the housing programme has been that it has attracted a larger number of foreign contractors to help increase the number of houses Algeria is able to build every year. This chapter contains interviews with Abdelkader Kadi, Minister of Public Works; and Lakhdar Rekhroukh, CEO, Cosider Group.

Overreliance on the energy sector in the last three decades has siphoned investment away from manufacturing and left Algeria with high import demand in a number of critical areas, including food supply, machinery, electronics and other consumer goods. However, in the last 10 years, Algeria has focused on developing local manufacturing industries in order to reduce its heavy import spending, boost employment, increase value addition and export revenues, and diversify the economy. Industry’s redevelopment has been somewhat arbitrary in recent years, yet a handful of segments have grown quickly, attracting new sources of foreign direct investment. In the retail sector, consumption patterns in Algeria are beginning to shift towards modern retail, supported by rising income levels and greater exposure to formal shopping outlets and international brands. Retail sales increased 30% from $28.7bn in 2007 to $37.5bn in 2011, while per-capita spending rose by 22% over the same period, to reach $1023 in 2011. Authorities hope that the rise of modern retail stores, particularly in the grocery segment, will have a positive knock-on effect for locally produced goods. This chapter contains interviews with Hamoud Tazerouti, CEO, Entreprise Nationale des Véhicules Industriels (SNVI); Amor Habes, Owner and General Manager, Faderco; and Javier Goñi, CEO, Fertiberia Group