DOCSLIB.ORG

Algerian Economy and COVID 19

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Algerian Economy and COVID 19 Embassy of India Algiers Algerian economy and COVID 19 Algeria’s economy is going through a difficult time due to decline in oil prices caused by increase in crude production coupled with falling of global demands from the outbreak of COVID-19. The economy of Algeria is very dependent on exports of hydrocarbons. In 2019, hydrocarbons contributed 92.80 % of the value of global exports with US$ 33.24 billion. Imports in 2019 have cost Algeria US$ 41.93 billions causing a deficit of US$ 6.110 billion. 2. Algeria has been struggling on economic front for past few years. Oil price decline in 2014, depleting foreign reserve and political instability have been the main factors for the economic crisis. Recent oil price decline and impact of Covid-19 is set to further deteriorate the economy. The effects would be harmful on all fronts including employment, investment, services, health sector, trade, businesses etc. 3. OPEC+ members have reached an agreement last week to reduce the oil production of 9.7 mbd starting from May , 2020. The reduction is the largest coordinated reduction in the history of oil-producing countries. It is too early to estimate the effect of this reduction as demand has already gone down due to the pandemic and there is no certainity when the normalcy would be restored in global economy. As such, the economy of Algeria would suffer heavily. It is estimated that oil demand reduction would cause reduction in Algerian exports to the tune of 20 %. The International Energy Agency (IEA) also expects the coronavirus crisis to wipe out nearly a decade of growth in oil demand in 2020. The historic drop will bring world consumption to its level of 2012 around 90.6 mb/d. Oil expert and former CEO of M/s Sonatrach, Algerian State Oil Company, Mr. Zouioueche said in a statement that OPEC+ production cut deal will have a short-term impact on oil prices, as the pandemic will continue to cause the decline in oil demand. 4. The Algerian president Mr. Abdelmadjid Tebboune said last month that he would cut planned public spending this year by 30 % , thereby delaying several economic and social projects aimed at reviving the economy. He also ordered State energy company M/s Sonatrach to halve planned investments spending to 7 $ billion, just three months after the government approved a new energy law aimed at boosting investment by offering incentives to foreign companies. Algerian Banks are deferring or rescheduling loan payments to firms that have been financially affected by the coronavirus crisis. 5. Crude oil is facing the biggest demand shock in its history, falling below 30 dollars a barrel, due to cessation of world trade ( started in China since January) following the Covid-19 pandemic and at the same time the disagreement between Saudi Arabia and Russia. Recent OPEC+ agreement seems to have no effect on falling crude prices. Because of current oil price drops, the largest disruption to trade will be for commodity sensitive economies like Algeria. The member countries of the Economic and Monetary Community of Central Africa (CEMAC) will be hit severely , which will exacerbate the shortage of foreign currency and probably strenghten the idea of the devaluation of the West African franc (CFA). Hence, Covid-19 will hit current account deficit , FDI, Portfolio investment inflows and remittances flows etc. Disruption of economic activities will restraint the Algerian economy to finance their development goals and support the import bill. 6. The Algerian government has recently undertaken an assessment of the economic impact of the Covid-19 pandemic. The assessment involves sectoral consultations involving employers’ organizations and unions to mitigate the effects of pandemic with focus on the financial and employment situation of companies. The tax authorities at the beginning of April announced few tax postponment measures to help the struggling economy and market. The Bank of Algeria has also relaxed prudential rules to allow banks to strengthen their financial capacities. However, fiscal measures and the partial lifting of prudential rules seem insufficient in the face of the damage caused by the Covid-19. 7. The International Monetary Fund (IMF) expects a 5.2 % drop in Algeria’s gross domestic product in 2020. In its recent report, the IMF also specifies that the Algerian economy should grow by 6.2 % in 2021 as economic activities normalizes. The inflation rate should be 3.5 % this year, before rising to 3.7 % in 2021.The IMF also indicates that the current accocunt defecit could reach -18.3 % of the GDP in 2020 , and decline slighly to -17.1 % the following year. The unemployment rate is expected to increase to 15.1 % this year before falling to 13.9 % in 2021. As per IMF, the economy of Middle East and North Africa (MENA) region is expected to contract by 3.3 % in 2020 because of Covid-19 and drop in oil prices. 8. The Covid 19 crisis wil certainly stretch the poor health care system of Algeria. Algeria imports majority of pharmaceuticals and medical equipments mainly from Europe and China even otherwise. The pandemic will ultimately create a shortage of medicines and health equipment. 9. As such, GDP of Algeria will shrink and it will adversely affect the bilateral trade and Indian companies present like L & T, Dodsal and M/s Shapoorji Pallonji engagaed in oil & gas, construction and engineering sectors. Indian pharma companies might also face difficulties due to the pandemic. 10. Algeria’s import bill of food products reached US$ 8 billion in 2019, which represented 19% of Algeria’s global imports. Algeria imported more than US$ 2,7 billion of wheat and maize in 2019. As such, Algerian economy might face challenges to secure the availability of food stuffs due to disruption of trade and decline in oil price. 19th April, 2020 .
Load more

Recommended publications
  • E/2020/17 Economic and Social Council
    United Nations E/2020/17 Economic and Social Council Distr.: General 5 May 2020 Original: English 2020 session 22 July 2019–25 July 2020 Agenda item 15 Regional cooperation Summary of the work of the Economic Commission for Africa, 2019–2020 Note by the Secretary-General The Secretary-General has the honour to transmit herewith a summary of the work of the Economic Commission for Africa for the period 2019–2020. 20-06383 (E) 010720 *2006383* E/2020/17 Summary of the work of the Economic Commission for Africa, 2019–2020 [Original: Arabic, English and French] Summary In the period from April 2019 to March 2020, the Economic Commission for Africa (ECA) achieved a number of significant milestones in support of member States’ development priorities and in line with the Commission’s new strategic directions to deliver ideas and actions for an empowered, inclusive and transformed Africa in the framework of the 2030 Agenda for Sustainable Development and Agenda 2063: The Africa We Want of the African Union. The present report summarizes notable achievements from that period that demonstrate the Commission’s three core functions in action, including interventions in support of regional and subregional priorities; policy advisory services at the national, subregional and regional level; and assistance provided upon the request of member States for technical and capacity development. Information is also included on the instrumental role of ECA platforms for policy dialogue and consensus-building in advancing the capacities of African public officials in policy formulation and implementation. 2/18 20-06383 E/2020/17 I. Introduction 1.
    [Show full text]
  • MELKI in CONTEXT: ALGERIA and EUROPEAN LEGAL INTEGRATION Daniela Caruso Joanna Geneve
    MELKI IN CONTEXT: ALGERIA AND EUROPEAN LEGAL INTEGRATION Cambridge University Press, forthcoming 2016 Boston University School of Law Public Law & Legal Theory Research Paper No. 15-23 June 15, 2015 Daniela Caruso Boston University School of Law Joanna Geneve Davis Polk and Wardwell LLP This paper can be downloaded without charge at: http://www.bu.edu/law/faculty/scholarship/workingpapers/2015.html 1 Daniela Caruso† and Joanna Geneve‡ MELKI IN CONTEXT: ALGERIA AND EUROPEAN LEGAL INTEGRATION in BILL DAVIES AND FERNANDA NICOLA EDS, EU LAW STORIES: CONTEXTUAL AND CRITICAL HISTORIES OF EUROPEAN JURISPRUDENCE Cambridge University Press, forthcoming 2016 I. INTRODUCTION It all happened quickly in spring 2010. On Monday March 22, at 2:15 pm, three policemen on patrol duty spotted a Citroën C4 coming from Saint-Aybert – a pre-Schengen frontier post between France and Belgium – and heading south-west towards Valenciennes.1 Nothing seemed wrong with the vehicle itself or the way it was driven, but somehow its passengers – five adult males of northern African origin – caught the attention of the officers, who turned on their lights and sirens and ordered that the vehicle stop. The driver obliged and the officers proceeded to question everyone in the car. No weapons were found and there was no resistance to interrogation or physical inspection, but the contrôle revealed that two of the passengers – Aziz Melki, aged 26, and Selim Abdeli, aged 19 – had no documents authorizing their entry into France.2 Within ten minutes the two Algerians found themselves arrested, and then unwittingly at the center of a judicial saga that is now well known in EU Law circles.
    [Show full text]
  • Criminal Justice Reform and Human Rights: Recent Trends
    Under the Patronage of his majesty king abdullah ii ibn alhussein Penal Reform International and the Office of the High Commissioner for Human Rights In partnership with the Public Security Directorate / Correctional and Rehabilitation Centers Department International Conference Criminal Justice Reform and Human Rights: Recent Trends November 2014 / - Amman - Jordan 3-4 Criminal Justice Reform and Human Rights: Recent Trends Table of Contents Table of Contents About Penal Reform International ................................................................................2 About Office of the High Commissioner for Human Rights ........................................3 About Correctional and Rehabilitation Centres Department ........................................4 Agenda ..........................................................................................................................5 Biographies ....................................................................................................................9 1 About PRI Criminal Justice Reform and Human Rights: Recent Trends Penal Reform International (PRI) Penal Reform International, founded in 1989 as an international non-governmental organization working on penal and criminal justice reform worldwide, with headquarters in London, PRI has Consultative Status with the United Nations (ECOSOC) and the Council of Europe, and Observer Status with the African Commission on Human and Peoples’ Rights, the African commission on the Rights and Welfare of the Child, and the Inter-parliamentary
    [Show full text]
  • Energy Interdependence. the Linkage of the Political Economy of Algeria´S Natural Gas with That of the Western Mediterranean Region
    Revista UNISCI / UNISCI Journal, Nº 47 (Mayo/May 2018) ENERGY INTERDEPENDENCE. THE LINKAGE OF THE POLITICAL ECONOMY OF ALGERIA´S NATURAL GAS WITH THAT OF THE WESTERN MEDITERRANEAN REGION. A METHODOLOGICAL APPROACH Roger Albinyana, Aurèlia Mañé-Estrada 1 University of Barcelona Abstract: There is a chronological parallelism between the surge of the natural gas sector in the Western Mediterranean and the setting up of the post-colonial Algerian economy in the early 1970s, which has led to the accretion of a series of cross- border and regional relationships of dependency. Because of Algeria’s overwhelming financial dependence on hydrocarbon resources (via economic rents), any attempt to modify the power relationship within its regional gas chain would immediately alter the way its political economy functions. This article presents a first outline of a methodological proposal aimed at analysing how the integration of the Algerian gas sector into regional gas chains in the Western Mediterranean affects the internal functioning of a rentier economy such as Algeria. By exploring the literature that helps capturing the relational effect between the Algerian domestic economy and the regional gas & oil structure of governance, the article suggests some analytical tools with the aim to evaluate the capacity of power and influence of each of the agents involved in the energy chain, from both Algeria and the other countries in the region. Keywords: Algeria, Western Mediterranean, natural gas, energy, regional integration, global value chain, global commodity chain, rentier state Título en Castellano : Interdependencia energética: el nexo de la economía política del gas natural de Argelia con el Mediterráneo occidental.
    [Show full text]
  • A CGE Analysis of the Economic Impact of Trade Liberalisation on the Algerian Economy
    European Journal of Sustainable Development (2016), 5, 3, 397-408 ISSN: 2239-5938 Doi: 10.14207/ejsd.2016.v5n3p397 A CGE Analysis of the Economic Impact of Trade Liberalisation on the Algerian Economy Touitou Mohammed1* Abstract The principal focus of the study is to show the nature and extent of the incentives trade policy liberalisation could provide on the way to further boost the economy of Algeria. It also tries to find out what the economic position would be, should the trade regime be more or fully liberalisation by reducing or elimination the existing tariff. In this study, different types of external price shocks are also considered in order to test the response of the economy. Model results indicate that by reducing tariffs, domestic output increase in almost all the sectors but government revenue and saving decline significantly. Government revenue fall due to the reduction/elimination of tariff could be compensated by reducing net subsides to the corporate sector and also by increasing income tax in a progressive way. Exports also increase showing the justification of the liberalisation and also supporting the argument that tariffs bias exports. But the increase in total import is bigger than the increase in exports which causes a deterioration of the real balance of trade, but the elimination of tariff increase private consumption and total absorption. Export price shocks in petroleum sectors chow a fall in domestic output and consequently a fall in value added and total employment. Domestic terms of trade of exports deteriorate and exports fall. This also causes a fall in GDP, private consumption and total absorption.
    [Show full text]
  • BRITAIN and ALGERIA, 1945-1965 by Geoffrey Barei Thesis Submitted in Partial Fulfilment of the Requirements for Degree of Doctor
    BRITAIN AND ALGERIA, 1945-1965 By Geoffrey Barei Thesis submitted in partial fulfilment of the requirements for degree of Doctor of Philosophy. (History) University of London School of Oriental and African Studies 2003 ProQuest Number: 10672941 All rights reserved INFORMATION TO ALL USERS The quality of this reproduction is dependent upon the quality of the copy submitted. In the unlikely event that the author did not send a com plete manuscript and there are missing pages, these will be noted. Also, if material had to be removed, a note will indicate the deletion. uest ProQuest 10672941 Published by ProQuest LLC(2017). Copyright of the Dissertation is held by the Author. All rights reserved. This work is protected against unauthorized copying under Title 17, United States C ode Microform Edition © ProQuest LLC. ProQuest LLC. 789 East Eisenhower Parkway P.O. Box 1346 Ann Arbor, Ml 48106- 1346 Acknowledgements Throughout various stages of this thesis, many people have made valuable criticisms and suggestions, and I am extremely grateful for their assistance. First, I would particularly like to express my extreme gratitude to Dr Michael Brett who supervised and guided this research throughout all its stages, and read the draft manuscript with great patience and made invaluable constructive comments and criticisms. Special thanks also go to lecturers and students of the History Department of the School of Oriental and African Studies (SOAS) for the friendly help and advice they have given me throughout my years there. Of special mention, is the introductory course on research methods by Professor Richard Rathbone. Indeed, it was worth attending the sessions.
    [Show full text]
  • Diversifying Algeria's Exports
    Diversifying Algeria’s exports: challenges and prospects relating to the African market Diversifying Algeria’s exports: challenges and prospects relating to the African market To order copies of Diversifying Algeria’s exports: challenges and prospects relating to the African market, please contact: Publications Section Economic Commission for Africa Menelik II Avenue P.O. Box 3001 Addis Ababa, Ethiopia Tel: +251 11 544-9900 Fax: +251 11 551-4416 E-mail: [email protected] Web: www.uneca.org © 2017 Economic Commission for Africa Addis Ababa, Ethiopia All rights reserved First printing August 2017 Material in this publication may be freely quoted or reprinted. Acknowledgement is requested, together with a copy of the publication. Designed and printed by the ECA Printing and Publishing Unit. ISO 14001:2004 certified. Cover photos: © Shutterstock iii Table of Contents 1. Introduction 1 2. Economic development in Algeria: an economy struggling to diversify 2 2.1 Economic performance 2 2.2 Trade structure and evolution 5 3. Trade in Algeria: the history of regulation and the state of play of export policy 9 3.1 Brief history of international trade regulation 9 3.2 Existing export-friendly public policies 12 4. Factors impeding export diversification 18 4.1 Theories 18 4.2 Support for theories: a survey to understand the views of Algerian business leaders 20 5. Diversifying exports to Africa: what reforms? 26 5.1 International experience: the case of Turkey 26 5.2 Reforms to be implemented in Algeria 32 5.3 How can Algeria diversify exports to Africa? 33 5.4 Exporting to Africa: removing barriers identified by entrepreneurs and building partnerships 37 6.
    [Show full text]
  • Energy Consumption Policy, GHG Emissions and Climate Change Impact in Algeria
    Journal of Environmental Treatment Techniques 2019, Volume 7, Issue 3, Pages: 306-315 J. Environ. Treat. Tech. ISSN: 2309-1185 Journal weblink: http://www.jett.dormaj.com Energy Consumption Policy, GHG Emissions and Climate Change Impact in Algeria Abdelkarim Mellah, Youcef Abdelhafid, Ahmed Benmalek Centre de recherche scientifique et technique sur les régions arides, CRSTRA, Biskra. Received: 25/04/2019 Accepted: 11/06/2019 Published: 01/12/2019 Abstract In recent years, the phenomenon of climate change has become very remarkable in Algeria, given its recorded effects on the temperature and precipitation. Algeria is among the top 50 countries at high risk of climate change, with a vulnerability index of 7.63%, because of its geographical position and climatic characteristics. This climate change leads to major risks in Algeria such as the displacement of sub-Saharan diseases like malaria, typhoid, and viral hepatitis, etc..., phenomenon of colored waters on the coast, drought on wide ranges, coastal erosion is also very marked, which may cause flood risks threatening in some regions. In this work, we present an analysis of GHG emissions as the main culprit in the phenomenon of climate change in Algeria compared to other countries. We analysis as well the national strategy to reduce GHG emissions and its plans of mitigation, adaptation, and the implementation of the program of renewable energies development and energy efficiency, whose offer a great potential for GHG mitigation. The analyses of data of temperature and rainfall from 2009 to 2018 show a clear tendency towards decreasing rainfall and increasing average temperatures in north and south of Algeria.
    [Show full text]
  • General Agreement on Tariffs and Trade
    RESTRICTED CCM.TD/32 GENERAL AGREEMENT ON 19 December 1966 TARIFFS AND TRADE Limited Distribution Committee on Trade and Development Eighth Session Punta del Este, Uruguay 16-20 January 1967 TECHNICAL ASSISTANCE BY GATT TO DEVELOPING COUNTRIES Trade and Aid Studies; Related Technical Assistance «-- Activities: Commercial Policy Courses ** Note by the Secretariat 1. The GATT is increasing its efforts to provide practical assistance to developing countries in the promotion of their trade and economic development. This document briefly describes these efforts in the recent past in the field of trade and aid studies; assistance to developing countries in connexion with par­ ticular trade policy problems; and training courses in commorcial policy. Reference is made in this document only to activities of the GATT Trade Centre which specifically relate to the kind of assistance referred to above. The activities of the Centre generally are described in a separate document (COM.TD/33). I. Trade and Aid Studies 2. Studies of the development plans of developing countries were initiated by GATT in i960; in 1961 and 1962, surveys of the plans of India and Pakistan were com­ pleted by the secretariat and discussed in GATT Committee III. At their meeting in &j May 1965, Ministers agreed that this type of work should be extended and that trade and aid studies of developing countries should be undertaken aimed at obtaining a clear analysis of export potential, market prospects and any further action that may be required to overcome any difficulties that the studies reveal. Provision for collaboration of trade and aid studies were subsequently written into Part IV of the General Agreement.
    [Show full text]
  • Editorial Board : Logistics Manag
    STRATEGY AND DEVELOPMENT REVIEW Approved Scientific International Review Specializing in the economic field Edited by the Faculty of Economics, Trade and Management Sciences University of Mostaganem, Algeria ISSN: 2170-0982 / E-ISSN: 2600-6839 / ISBN: 1122-3974 / Class: C Honorary President: Pr. Mostefa BELHAKEM Director and Editor-in-Chief: Pr. Laadjal ADALA Assistant director: Dr. Laid KORICHI Chairman of the Reading Committee: Dr. Djilali BOUCHERF Director of Electronic Publishing: Dr. Hadj KHELIFA Editor-in-Chief Assistant : Dr. Mohsen B. Salem BRAHMI- France Editorial board : Pr. Dominique BARUEL BENCHERQUI Dr. Khaldia BOUDJENANE Pr. Mirjana RADOVIC- Markovie Dr. Nassima DJELLOULI Dr. Mohamed Ridha BOUCENNA Dr. Anne - Flore Maman LARRAUFIE Logistics Manager: Mr. Ahmed ABBASSA- S. G. of the Faculty Computer Cell: Dr. Mohammed BENMOUSSA Mr. Ali BOUDJELAL Miss. Asmaa DRISSI Miss. Karima DJELLAM Miss. Samia DRISSI Mme. Nadra RECHIDI-SIDHOUM Reading Committee: Pr. Belgacem ZAIRI –Algeria Dr. Wahiba GAHAM, Algeria Dr. Oana Brindusa ALBU– Denmark Dr. Mohamed KNOUCHE – Turkey Dr. Tawfik Sarii BASERDA –Yemen Dr. Abdelhamid LAKHDIMI– Algeria Dr. Khaled A. ELBANDARI – Egypt Dr. Fatima LALMI– Algeria Dr. Sandra S. FILIPE – Portugal Dr. Zoran D. SIMONOVIC – Serbia 1 Scientific committee: Dr. Abdelkader CHAA – (Dean), Algeria Dr. Ismail BENGGANA, Algeria Pr. Ahmed Ameur AMEUR, Algeria Dr. Hadj BENZIDANE, Algeria Pr. Abdelkader BABA, Algeria Dr. Ruslan F. BRUKHANSKYI, Ukraine Pr. Cameron A. BATMANGHLICH, U.K. Dr. Ilias CHAHED, Algeria Pr. Mustapha BELMOKADEM, Algeria Dr. Samir CHERAKRAK, Algeria Pr. Mohammed BENBOUZIANE, Algeria Dr. Billal CHIKHI, Algeria Pr. Abdeslam BENDIABDELLAH , Algeria Dr. Kralj DAVORIN, Slovenia Pr. Abdelrazak BENHABIB, Algeria Dr. Caner DINCER, France Pr. Ahmed BOUSSAHMINE, Algeria Dr.
    [Show full text]
  • Review of ECONOMIC CONDITIONS in AFRICA REVIEW of ECONOMIC CONDITIONS
    Supplement to WORLD ECONOMIC REPORT, 1949-18 UN IT ED NAT I O ,NS • Review of ECONOMIC CONDITIONS in AFRICA REVIEW OF ECONOMIC CONDITIONS IN AFRICA Supplement to World Economic Report, 1949-50 UNITED NATIONS DEPARTMENT OF ECONOMIC AFFAIRS New York, March 1951 E/191O/Add.lIRev.1 ST/ECA/9/ Add.1 Apri11951 UNITED NATIONS PUBLICATIONS Sales No.: 1951.II.C.2 FOREWORD The Secretariat of the United Nations has prepared the present Review of Economic Conditions in Africa in response to resolution 266 (X) of the Economic and Social Council, which requests the Secretary-General "to include in the world economic report, to be prepared for the twelfth session of the Council, a special section relating to economic conditions in Africa, using material readily available and such further information as may be provided by the Governments concerned". This report, and its companion volume, the Review of Economic Conditions in the Middle East, are issued as separate sections of the World Economic Report, 1949-50; these volumes are intended to complement the regional surveys prepared annually by the secretariats of the United Nations economic commissions for Europe, for Asia and the Far East and for Latin America. The reports, in pre­ liminary form, were made available in February 1951 to the twelfth session of the Economic and Social Council. The Division of Economic Stability and Development of the Department of Economic Affairs, which is primarily responsible for the preparation of the present Review, wishes to acknowledge the assistance it has received from the Department of Trusteeship and Information from Non-Self-Governing Territories, from the Statistical Office of the United Nations and, in connexion with the statement on demographic matters, from the Population Division of the Department of Social Affairs.
    [Show full text]
  • The Case of Algeria Under Houari Boumedienne, 1965-1978
    Ideologised Foreign Policy and the Pragmatic Rationale: The Case of Algeria under Houari Boumedienne, 1965-1978. Submitted in accordance with the requirements for the degree of Doctor of Philosophy By Radia Kesseiri, B.A., MA. This copy has been supplied on the understanding that it is copyright material and that no quotation from the thesis may be published without proper acknowledgement. The candidate confirms that the work submitted is her own and that appropriate credit has been given where reference has been made to the work of others. The Department of Arabic and Middle Eastern Studies The University of Leeds November 2005 Dedication I dedicate this work to my lovely parents, Mohamed and Zohra Kesseiri . 11 Acknowledgements Firstly I would like to thank Dr Hussein Sirriyeh for his supervision, patience and support over the last years. I must also extend my gratitude to Dr Zahia Salhi who has been of continuous support and encouragement to me. I would like to thank Dr Yahiyaoui, Director of the Centre of Research and Studies on the Movement of the First of November in Algiers, Mr Karim Alt Arkoub, Departmental Director at the Presidency, Mr Y oucef Shebli, Director of Financial Services, and Mr Ghezali from SONATRACHI Algiers and staff at the National Library of Algiers. Special thanks must go to Mr Abdelkrim Belarbi for his warm welcome and valuable assistance every time I needed to obtain material for my research. I must thank all the members of the 'Centre of National Archives' in Algiers and the staff at the Centre of Research and Studies on the Movement of the First of November, and the people at the National Union of Algerian Youths.
    [Show full text]