In another major policy shift, the government decided to seek
badly needed cash and access to credit in order to ensure
sustained economic growth. Despite concerns about foreign
ownership of Algerian "patrimony," economic pragmatism dictated
passage of the Law on Money and Credit of April 1990. This law
liberalized the country's foreign-investment code to the extent
that only telecommunications, electricity production, hydrocarbon
refining and distribution, and railroad transport remained closed
to foreigners. As for the exchange system, the new law prohibited
multiple exchange rates for the dinar and assigned the Money and
Credit Council, a board composed of Central Bank and other
Algerian government officials, the responsibility of setting
foreign-exchange and external-debt policy. The council was also
charged with approving foreign investments and joint ventures.
Another objective of the April 1990 law was to attract
foreign capital by formalizing the legal framework for
investment. The law permitted the repatriation of capital and
accumulated profits, subject to approval by the Central Bank.
Investments in the hydrocarbon sector, however, were still
governed by Law 86-14 of August 1986, which limited foreign
investors to joint ventures with Sonatrach. The government's
investment priorities were listed as agriculture and
agribusiness; agricultural machinery; mineral, hydrocarbon, and
electricity production and distribution; petrochemicals; basic
and primary transformed steel and metallurgical products;
railroad transport; capital goods; and tourism.
The Law on Money and Credit not only created a more positive
investment climate but also proved to be quite a contrast to
previous foreign-investment laws of August 1982 and August 1986.
These two laws had only allowed the repatriation of profits and
indemnities awarded by Algerian courts to foreign investors, who
were denied any recourse to international arbitration of
disputes, except those covered by a special Franco-Algerian
protocol, and whose commercial disputes could be resolved only
under Algerian law.
The Supplementary Finance Law of August 1990 introduced the
system of concessionaires and wholesalers (exclusive dealers
representing foreign companies) as a major ingredient of the
import liberalization process. Before this law was passed, only
monopolies could import goods for resale. The same law also
broadened the right to use a foreign-currency account to include
any business in addition to individuals. The new accounts could
be used for making any legitimate payments relating to the
business of the account holder. In April 1991, the government
announced a change in the import system: all imports of
merchandise not prohibited were given full access to foreign
exchange at the official exchange rate. All import licensing
restrictions were abolished, except for imports receiving
government subsidies, which continued to be subject to
administrative control because of domestic trading restrictions.
Several other measures also served to attract foreign
capital. In December 1987, the government joined the
International Finance Corporation, a World Bank body that
specializes in encouraging private enterprises. In June 1990, it
signed an agreement allowing the Overseas Private Investment
Corporation to operate its investment promotion, financing, and
insurance program for United States investors in Algeria. In
October 1990, the government established the Agency for
Development and Promotion of Investment to familiarize potential
foreign investors with Algeria's business climate and to
facilitate their investments in its companies.
Although the authorities indicated a strong and
understandable interest in enhancing employment opportunities in
the eastern and southern desert areas of the country, geographic
investment preferences were not made a prerequisite for foreign
investment. Nor were sectoral preferences required, but it was
clear that the authorities would evaluate any foreign-investment
proposal for its potential contribution to increasing Algeria's
productive capability, nonhydrocarbon exports, and technology
transfer. The Ministry of Economy issued a supplementary
regulation in September 1990, outlining its own priorities and
defining the objectives of investments. These were to finance
production of goods and services that generated hard currency; to
reduce imports of goods and services; to improve distribution of
goods and equipment; and to engage in economic activities that
enhanced the profitability of public transport,
telecommunications, and water and electricity distribution--
subject to approval by the competent government agencies. Both
foreign investors and Algerian entities were given equal access
to credit from local banks, with no restrictions on reinvestment.
No discriminatory or preferential export or import regulations
were to be applied to foreign-owned businesses. Any firm engaged
in exporting its output would, regardless of ownership, be
allowed to retain 100 percent of its foreign-exchange earnings
for use in importing raw materials and machinery needed to
sustain its production.
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Background | | After more than a century of rule by France, Algerians fought through much of the 1950s to achieve independence in 1962. Algeria's primary political party, the National Liberation Front (FLN), has dominated politics ever since. Many Algerians in the subsequent generation were not satisfied, however, and moved to counter the FLN's centrality in Algerian politics. The surprising first round success of the Islamic Salvation Front (FIS) in the December 1991 balloting spurred the Algerian army to intervene and postpone the second round of elections to prevent what the secular elite feared would be an extremist-led government from assuming power. The army began a crackdown on the FIS that spurred FIS supporters to begin attacking government targets. The government later allowed elections featuring pro-government and moderate religious-based parties, but this did not appease the activists who progressively widened their attacks. The fighting escalated into an insurgency, which saw intense fighting between 1992-98 resulting in over 100,000 deaths - many attributed to indiscriminate massacres of villagers by extremists. The government gained the upper hand by the late-1990s and FIS's armed wing, the Islamic Salvation Army, disbanded in January 2000. Abdelaziz BOUTEFLIKA, with the backing of the military, won the presidency in 1999 in an election widely viewed as fraudulent and was reelected in a landslide victory in 2004. BOUTEFLIKA was overwhelmingly reelected to a third term in 2009 after the government amended the constitution in 2008 to remove presidential term limits. Longstanding problems continue to face BOUTEFLIKA, including large-scale unemployment, a shortage of housing, unreliable electrical and water supplies, government inefficiencies and corruption, and the continuing activities of extremist militants. The Salafist Group for Preaching and Combat (GSPC) in 2006 merged with al-Qaida to form al-Qaida in the Lands of the Islamic Maghreb, which has launched an ongoing series of kidnappings and bombings - including high-profile, mass-casualty suicide attacks targeting the Algerian Government and Western interests.
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Location | | Northern Africa, bordering the Mediterranean Sea, between Morocco and Tunisia
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Area(sq km) | | total: 2,381,741 sq km
land: 2,381,741 sq km
water: 0 sq km
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Geographic coordinates | | 28 00 N, 3 00 E
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Land boundaries(km) | | total: 6,343 km
border countries: Libya 982 km, Mali 1,376 km, Mauritania 463 km, Morocco 1,559 km, Niger 956 km, Tunisia 965 km, Western Sahara 42 km
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Coastline(km) | | 998 km
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Climate | | arid to semiarid; mild, wet winters with hot, dry summers along coast; drier with cold winters and hot summers on high plateau; sirocco is a hot, dust/sand-laden wind especially common in summer
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Elevation extremes(m) | | lowest point: Chott Melrhir -40 m
highest point: Tahat 3,003 m
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Natural resources | | petroleum, natural gas, iron ore, phosphates, uranium, lead, zinc
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Land use(%) | | arable land: 3.17%
permanent crops: 0.28%
other: 96.55% (2005)
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Irrigated land(sq km) | | 5,690 sq km (2003)
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Total renewable water resources(cu km) | | 14.3 cu km (1997)
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Freshwater withdrawal (domestic/industrial/agricultural) | | total: 6.07 cu km/yr (22%/13%/65%)
per capita: 185 cu m/yr (2000)
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Natural hazards | | mountainous areas subject to severe earthquakes; mudslides and floods in rainy season
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Environment - current issues | | soil erosion from overgrazing and other poor farming practices; desertification; dumping of raw sewage, petroleum refining wastes, and other industrial effluents is leading to the pollution of rivers and coastal waters; Mediterranean Sea, in particular, becoming polluted from oil wastes, soil erosion, and fertilizer runoff; inadequate supplies of potable water
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Environment - international agreements | | party to: Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Environmental Modification, Hazardous Wastes, Law of the Sea, Ozone Layer Protection, Ship Pollution, Wetlands
signed, but not ratified: none of the selected agreements
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Geography - note | | second-largest country in Africa (after Sudan)
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Population | | 34,178,188 (July 2009 est.)
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Age structure(%) | | 0-14 years: 25.4% (male 4,436,591/female 4,259,729)
15-64 years: 69.5% (male 11,976,965/female 11,777,618)
65 years and over: 5.1% (male 798,576/female 928,709) (2009 est.)
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Median age(years) | | total: 26.6 years
male: 26.3 years
female: 26.8 years (2009 est.)
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Population growth rate(%) | | 1.196% (2009 est.)
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Birth rate(births/1,000 population) | | 16.9 births/1,000 population (2009 est.)
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Death rate(deaths/1,000 population) | | 4.64 deaths/1,000 population (July 2009 est.)
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Net migration rate(migrant(s)/1,000 population) | | -0.29 migrant(s)/1,000 population (2009 est.)
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Urbanization(%) | | urban population: 65% of total population (2008)
rate of urbanization: 2.5% annual rate of change (2005-10 est.)
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Sex ratio(male(s)/female) | | at birth: 1.05 male(s)/female
under 15 years: 1.04 male(s)/female
15-64 years: 1.02 male(s)/female
65 years and over: 0.86 male(s)/female
total population: 1.01 male(s)/female (2009 est.)
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Infant mortality rate(deaths/1,000 live births) | | total: 27.73 deaths/1,000 live births
male: 30.86 deaths/1,000 live births
female: 24.45 deaths/1,000 live births (2009 est.)
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Life expectancy at birth(years) | | total population: 74.02 years
male: 72.35 years
female: 75.77 years (2009 est.)
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Total fertility rate(children born/woman) | | 1.79 children born/woman (2009 est.)
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Nationality | | noun: Algerian(s)
adjective: Algerian
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Ethnic groups(%) | | Arab-Berber 99%, European less than 1%
note: almost all Algerians are Berber in origin, not Arab; the minority who identify themselves as Berber live mostly in the mountainous region of Kabylie east of Algiers; the Berbers are also Muslim but identify with their Berber rather than Arab cultural heritage; Berbers have long agitated, sometimes violently, for autonomy; the government is unlikely to grant autonomy but has offered to begin sponsoring teaching Berber language in schools
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Religions(%) | | Sunni Muslim (state religion) 99%, Christian and Jewish 1%
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Languages(%) | | Arabic (official), French, Berber dialects
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Country name | | conventional long form: People's Democratic Republic of Algeria
conventional short form: Algeria
local long form: Al Jumhuriyah al Jaza'iriyah ad Dimuqratiyah ash Sha'biyah
local short form: Al Jaza'ir
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Government type | | republic
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Capital | | name: Algiers
geographic coordinates: 36 45 N, 3 03 E
time difference: UTC+1 (6 hours ahead of Washington, DC during Standard Time)
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Administrative divisions | | 48 provinces (wilayat, singular - wilaya); Adrar, Ain Defla, Ain Temouchent, Alger, Annaba, Batna, Bechar, Bejaia, Biskra, Blida, Bordj Bou Arreridj, Bouira, Boumerdes, Chlef, Constantine, Djelfa, El Bayadh, El Oued, El Tarf, Ghardaia, Guelma, Illizi, Jijel, Khenchela, Laghouat, Mascara, Medea, Mila, Mostaganem, M'Sila, Naama, Oran, Ouargla, Oum el Bouaghi, Relizane, Saida, Setif, Sidi Bel Abbes, Skikda, Souk Ahras, Tamanghasset, Tebessa, Tiaret, Tindouf, Tipaza, Tissemsilt, Tizi Ouzou, Tlemcen
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Constitution | | 8 September 1963; revised 19 November 1976; effective 22 November 1976; revised 3 November 1988, 23 February 1989, 28 November 1996, 10 April 2002, and 12 November 2008
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Legal system | | socialist, based on French and Islamic law; judicial review of legislative acts in ad hoc Constitutional Council composed of various public officials including several Supreme Court justices; has not accepted compulsory ICJ jurisdiction
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Suffrage | | 18 years of age; universal
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Executive branch | | chief of state: President Abdelaziz BOUTEFLIKA (since 28 April 1999) note - the president is both the chief of state and head of government; a November 2008 constitutional amendment separated the position of head of government from that of the prime minister
head of government: President Abdelaziz BOUTEFLIKA (since 28 April 1999)
cabinet: Cabinet of Ministers appointed by the president
elections: president elected by popular vote for a five-year term; note - a November 2008 constitutional amendment abolished presidential term limits; election last held 9 April 2009 (next to be held in April 2014)
election results: Abdelaziz BOUTEFLIKA reelected president for third term; percent of vote - Abdelaziz BOUTEFLIKA 90.2%, Louisa HANOUNE 4.2%, Moussa TOUATI 2.3%, Djahid YOUNSI 1.4%, Ali Fawzi REBIANE less than 1%, Mohamed SAID less than 1%
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Legislative branch | | bicameral Parliament consists of the National Council (upper house; 144 seats; one-third of the members appointed by the president, two-thirds elected by indirect vote to serve six-year terms; the constitution requires half the Council to be renewed every three years) and the National People's Assembly (lower house; 389 seats; members elected by popular vote to serve five-year terms)
elections: National Council - last held 28 December 2006 (next to be held 29 December 2009); National People's Assembly - last held 17 May 2007 (next to be held in 2012)
election results: National Council - percent of vote by party - NA; seats by party - NA; National People's Assembly - percent of vote by party - NA; seats by party - FLN 136, RND 61, MSP 52, PT 26, RCD 19, FNA 13, other 49, independents 33;
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Judicial branch | | Supreme Court
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Political pressure groups and leaders | | The Algerian Human Rights League or LADDH [Hocine ZEHOUANE]; SOS Disparus [Nacera DUTOUR]
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International organization participation | | ABEDA, AfDB, AFESD, AMF, AMU, AU, BIS, FAO, G-15, G-24, G-77, IAEA, IBRD, ICAO, ICC, ICCt (signatory), ICRM, IDA, IDB, IFAD, IFC, IFRCS, IHO, ILO, IMF, IMO, IMSO, Interpol, IOC, IOM, IPU, ISO, ITSO, ITU, ITUC, LAS, MIGA, MONUC, NAM, OAPEC, OAS (observer), OIC, OPCW, OPEC, OSCE (partner), UN, UNCTAD, UNESCO, UNHCR, UNIDO, UNITAR, UNWTO, UPU, WCO, WFTU, WHO, WIPO, WMO, WTO (observer)
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Flag description | | two equal vertical bands of green (hoist side) and white; a red, five-pointed star within a red crescent centered over the two-color boundary; the colors represent Islam (green), purity and peace (white), and liberty (red); the crescent and star are also Islamic symbols, but the crescent is more closed than those of other Muslim countries because the Algerians believe the long crescent horns bring happiness
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Economy - overview | | The hydrocarbons sector is the backbone of the economy, accounting for roughly 60% of budget revenues, 30% of GDP, and over 95% of export earnings. Algeria has the eighth-largest reserves of natural gas in the world and is the fourth-largest gas exporter; it ranks 15th in oil reserves. Sustained high oil prices in recent years have helped improve Algeria's financial and macroeconomic indicators. Algeria is running substantial trade surpluses and building up record foreign exchange reserves. Algeria has decreased its external debt to less than 5% of GDP after repaying its Paris Club and London Club debt in 2006. Real GDP has risen due to higher oil output and increased government spending. The government's continued efforts to diversify the economy by attracting foreign and domestic investment outside the energy sector, however, has had little success in reducing high unemployment and improving living standards. Structural reform within the economy, such as development of the banking sector and the construction of infrastructure, moves ahead slowly hampered by corruption and bureaucratic resistance.
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GDP (purchasing power parity) | | $233.5 billion (2008 est.)
$225.6 billion (2007 est.)
$218.8 billion (2006 est.)
note: data are in 2008 US dollars
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GDP (official exchange rate) | | $159.7 billion (2008 est.)
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GDP - real growth rate(%) | | 3.5% (2008 est.)
3.1% (2007 est.)
2.1% (2006 est.)
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GDP - per capita (PPP) | | $6,900 (2008 est.)
$6,800 (2007 est.)
$6,600 (2006 est.)
note: data are in 2008 US dollars
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GDP - composition by sector(%) | | agriculture: 8.3%
industry: 62.3%
services: 29.4% (2008 est.)
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Labor force | | 9.464 million (2008 est.)
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Labor force - by occupation(%) | | agriculture 14%, industry 13.4%, construction and public works 10%, trade 14.6%, government 32%, other 16% (2003 est.)
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Unemployment rate(%) | | 12.8% (2008 est.)
11.8% (2007 est.)
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Population below poverty line(%) | | 23% (2006 est.)
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Household income or consumption by percentage share(%) | | lowest 10%: 2.8%
highest 10%: 26.8% (1995)
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Distribution of family income - Gini index | | 35.3 (1995)
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Investment (gross fixed)(% of GDP) | | 26.1% of GDP (2008 est.)
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Budget | | revenues: $70.06 billion
expenditures: $56.04 billion (2008 est.)
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Inflation rate (consumer prices)(%) | | 4.4% (2008 est.)
3.5% (2007 est.)
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Stock of money | | $60.91 billion (31 December 2008)
$55.43 billion (31 December 2007)
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Stock of quasi money | | $30.36 billion (31 December 2008)
$28.59 billion (31 December 2007)
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Stock of domestic credit | | $NA (31 December 2008)
$NA (31 December 2007)
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Market value of publicly traded shares | | $NA
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Economic aid - recipient | | $370.6 million (2005 est.)
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Public debt(% of GDP) | | 8.4% of GDP (2008 est.)
37.4% of GDP (2004 est.)
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Agriculture - products | | wheat, barley, oats, grapes, olives, citrus, fruits; sheep, cattle
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Industries | | petroleum, natural gas, light industries, mining, electrical, petrochemical, food processing
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Industrial production growth rate(%) | | 3.2% (2008 est.)
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Current account balance | | $35.27 billion (2008 est.)
$30.6 billion (2007 est.)
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Exports | | $78.23 billion (2008 est.)
$60.6 billion (2007 est.)
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Exports - commodities(%) | | petroleum, natural gas, and petroleum products 97%
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Exports - partners(%) | | US 23.9%, Italy 15.5%, Spain 11.4%, France 8%, Netherlands 7.8%, Canada 6.8% (2008)
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Imports | | $39.16 billion (2008 est.)
$26.4 billion (2007 est.)
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Imports - commodities(%) | | capital goods, foodstuffs, consumer goods
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Imports - partners(%) | | France 16.5%, Italy 11%, China 10.3%, Spain 7.4%, Germany 6.1%, US 5.5% (2008)
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Reserves of foreign exchange and gold | | $143.5 billion (31 December 2008 est.)
$110.6 billion (31 December 2007 est.)
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Debt - external | | $3.753 billion (31 December 2008 est.)
$3.957 billion (31 December 2007 est.)
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Stock of direct foreign investment - at home | | $13.76 billion (31 December 2008 est.)
$11.91 billion (31 December 2007 est.)
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Stock of direct foreign investment - abroad | | $1.162 billion (31 December 2008 est.)
$962 million (31 December 2007 est.)
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Exchange rates | | Algerian dinars (DZD) per US dollar - 63.25 (2008 est.), 69.9 (2007), 72.647 (2006), 73.276 (2005), 72.061 (2004)
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Currency (code) | | Algerian dinar (DZD)
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Telephones - main lines in use | | 3.314 million (2008)
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Telephones - mobile cellular | | 31.871 million (2008)
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Telephone system | | general assessment: a weak network of fixed-main lines, which remains at roughly 10 telephones per 100 persons, is offset by the rapid increase in mobile cellular subscribership; in 2008, combined fixed-line and mobile telephone density surpassed 100 telephones per 100 persons
domestic: privatization of Algeria's telecommunications sector began in 2000; three mobile cellular licenses have been issued and, in 2005, a consortium led by Egypt's Orascom Telecom won a 15-year license to build and operate a fixed-line network in Algeria; the license will allow Orascom to develop high-speed data and other specialized services and contribute to meeting the large unfulfilled demand for basic residential telephony; Internet broadband services began in 2003
international: country code - 213; landing point for the SEA-ME-WE-4 fiber-optic submarine cable system that provides links to Europe, the Middle East, and Asia; microwave radio relay to Italy, France, Spain, Morocco, and Tunisia; coaxial cable to Morocco and Tunisia; participant in Medarabtel; satellite earth stations - 51 (Intelsat, Intersputnik, and Arabsat) (2008)
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Internet country code | | .dz
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Internet users | | 4.1 million (2008)
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Airports | | 143 (2009)
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Pipelines(km) | | condensate 1,937 km; gas 14,648 km; liquid petroleum gas 2,933 km; oil 7,579 km (2008)
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Roadways(km) | | total: 108,302 km
paved: 76,028 km (includes 645 km of expressways)
unpaved: 32,274 km (2004)
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Ports and terminals | | Algiers, Annaba, Arzew, Bejaia, Djendjene, Jijel, Mostaganem, Oran, Skikda
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Military branches | | People's National Army (Armee Nationale Populaire, ANP), Land Forces (Forces Terrestres, FT), Navy of the Republic of Algeria (Marine de la Republique Algerienne, MRA), Air Force (Al-Quwwat al-Jawwiya al-Jaza'eriya, QJJ), Territorial Air Defense Force (2009)
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Military service age and obligation(years of age) | | 19-30 years of age for compulsory military service; conscript service obligation - 18 months (6 months basic training, 12 months civil projects) (2006)
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Manpower available for military service | | males age 16-49: 9,736,757
females age 16-49: 9,590,978 (2008 est.)
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Manpower fit for military service | | males age 16-49: 8,317,473
females age 16-49: 8,367,005 (2009 est.)
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Manpower reaching militarily significant age annually | | male: 375,852
female: 362,158 (2009 est.)
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Military expenditures(% of GDP) | | 3.3% of GDP (2006)
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Disputes - international | | Algeria, and many other states, rejects Moroccan administration of Western Sahara; the Polisario Front, exiled in Algeria, represents the Sahrawi Arab Democratic Republic; Algeria's border with Morocco remains an irritant to bilateral relations, each nation accusing the other of harboring militants and arms smuggling; Algeria remains concerned about armed bandits operating throughout the Sahel who sometimes destabilize southern Algerian towns; dormant disputes include Libyan claims of about 32,000 sq km still reflected on its maps of southeastern Algeria and the FLN's assertions of a claim to Chirac Pastures in southeastern Morocco
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Refugees and internally displaced persons | | refugees (country of origin): 90,000 (Western Saharan Sahrawi, mostly living in Algerian-sponsored camps in the southwestern Algerian town of Tindouf)
IDPs: undetermined (civil war during 1990s) (2007)
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Trafficking in persons | | current situation: Algeria is a transit country for men and women trafficked from sub-Saharan Africa to Europe for the purposes of commercial sexual exploitation and involuntary servitude; Algerian children are trafficked internally for the purpose of domestic servitude or street vending
tier rating: Tier 3 - Algeria did not report any serious law enforcement actions to punish traffickers who force women into commercial sexual exploitation or men into involuntary servitude in 2007; the government again reported no investigations of trafficking of children for domestic servitude or improvements in protection services available to victims of trafficking; Algeria still lacks victim protection services, and its failure to distinguish between trafficking and illegal migration may result in the punishment of victims of trafficking (2008)
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Electricity - production(kWh) | | 34.98 billion kWh (2007 est.)
|
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Electricity - production by source(%) | | fossil fuel: 99.7%
hydro: 0.3%
nuclear: 0%
other: 0% (2001)
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Electricity - consumption(kWh) | | 28.34 billion kWh (2007 est.)
|
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Electricity - exports(kWh) | | 273 million kWh (2007 est.)
|
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Electricity - imports(kWh) | | 279 million kWh (2007 est.)
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Oil - production(bbl/day) | | 2.18 million bbl/day (2008 est.)
|
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Oil - consumption(bbl/day) | | 299,000 bbl/day (2008 est.)
|
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Oil - exports(bbl/day) | | 1.891 million bbl/day (2007 est.)
|
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Oil - imports(bbl/day) | | 14,320 bbl/day (2007 est.)
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Oil - proved reserves(bbl) | | 12.2 billion bbl (1 January 2009 est.)
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Natural gas - production(cu m) | | 86.5 billion cu m (2008 est.)
|
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Natural gas - consumption(cu m) | | 26.83 billion cu m (2008 est.)
|
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Natural gas - exports(cu m) | | 59.67 billion cu m (2008)
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Natural gas - proved reserves(cu m) | | 4.502 trillion cu m (1 January 2009 est.)
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HIV/AIDS - adult prevalence rate(%) | | 0.1%; note - no country specific models provided (2007 est.)
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HIV/AIDS - people living with HIV/AIDS | | 21,000 (2007 est.)
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HIV/AIDS - deaths | | fewer than 1,000 (2007 est.)
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Literacy(%) | | definition: age 15 and over can read and write
total population: 69.9%
male: 79.6%
female: 60.1% (2002 est.)
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School life expectancy (primary to tertiary education)(years) | | total: 13 years
male: 13 years
female: 13 years (2005)
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Education expenditures(% of GDP) | | 5.1% of GDP (1999)
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