Country Forecast Algeria September 2017

Country Forecast Algeria September 2017

  • September 2017 •
  • Report ID: 1698363 •
  • Format: PDF

Policy towards private enterprise and competition

2017-18: Monopoly powers remain strong, especially in import concessions and product markets. Smaller privatisations proceed in manufacturing and other non-strategic sectors.

2019-21: The government protects local companies as economic interaction with the EU deepens. Incoherent government policies towards the private sector remain an issue for investors.

Policy towards foreign investment

2017-18: Despite pro-investment rhetoric and some pro-business reforms, the government maintains inconsistent policies towards foreign investment. Rules on foreign ownership are loosened in non-strategic sectors such as tourism and some manufacturing industries.

2019-21: Transparency in the awarding of contracts and permits improves. Foreign firms remain restricted to minority shares in the oil and gas sector.

Foreign trade and exchange controls

2017-18: Algeria maintains protectionist policies to boost domestic production. Repatriating profits remains difficult for companies seen to be earning excessive income in the Algerian market.

2019-21: Trade liberalisation disappoints; World Trade Organisation accession is far off, but closer integration with the EU is pursued. Regional trade remains hindered by political tensions and a focus on the EU and larger emerging markets.


2017-18: The government increases direct and indirect tax rates across the board, in an effort to compensate for lower oil and gas revenue, and introduces new taxes on luxury items and energy-inefficient products.

2019-21: Further tax hikes are introduced, including increased value-added tax (VAT) rates on fuel. The multi-tier system of corporate tax, with different rates for manufacturing, construction and imports, is unified.


2017-18: The central bank lowers statutory reserve requirements in an attempt to boost liquidity in the banking sector, which has been badly affected by the fall in government hydrocarbons revenue.

2019-21: The local bond market deepens, and efforts to expand the stock exchange continue. The government starts borrowing on international capital markets and proceeds with part-privatisations of some public banks.

The labour market

2017-18: The government continues to invest in vocational training programmes, but severe skills shortages persist.

2019-21: Labour reform remains patchy as the private sector grows, but unions remain a powerful force, with intensifying rivalry between independent unions and the state-backed Union générale des travailleurs algériens.


2017-18: The upgrading of roads contributes to the improvement of transport infrastructure, although low oil prices cause some projects to be delayed. Housebuilding proceeds apace but demand continues to outstrip supply.

2019-21: Infrastructure development improves the business environment, but access to the interior remains poor. Renewables-particularly solar power stations-receive state investment.


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