Algeria economic trends and sector shifts this week

Policy and institutional signals

The government also launched its Covid-19 booster campaign on 21 May, using the COVAX facility to distribute 1.2 million doses of the Pfizer-BioNTech vaccine. Health ministry data show 94% of the adult population has received at least one dose, while 81% have completed primary vaccination. The campaign targets priority groups, including healthcare workers and people with chronic conditions.

Water, climate and infrastructure

A peer-reviewed study published on 20 May 2024 assesses water quality and toxic element risks in Oued Souf, using an integrated weight water quality index and potential toxic element analysis supported by simulation modelling. The research highlights elevated levels of arsenic (17 µg/L), lead (12 µg/L) and cadmium (3.1 µg/L) in surface waters, exceeding WHO guidelines in multiple samples. Authors recommend targeted remediation and tighter industrial discharge controls. The findings are expected to inform Algeria’s 2025 national water security plan.

On desertification, new research examines the macro-scale impacts of large-scale Sahara solar farms on regional climate and vegetation cover. The modelling suggests that installations exceeding 10 GW in contiguous desert zones could reduce local precipitation by up to 8% and shift vegetative boundaries northward by approximately 50 km over 30 years. The study does not include Algerian projects by name but uses North African averages for solar irradiance and land-use assumptions.

Real estate, data and investment climate

Algeria’s ongoing financial reforms are cited in Washington policy circles as showing incremental progress, particularly in central bank regulations and anti-money laundering compliance. Banking executives report that capital controls on foreign exchange remain in place, but the cap on letters of credit for essential imports has been raised from USD 500,000 to USD 1 million per transaction. The move aims to ease access to raw materials for manufacturers.

Investment promotion agencies continue to push data-driven growth strategies. A 19 May policy note from the Ministry of Industry and Pharmaceutical Production highlights plans to double the share of manufacturing in GDP from 5% to 10% by 2030, with a focus on pharmaceuticals, agri-processing and construction materials. To support this, the government has earmarked DZD 47 billion (USD 350 million) for digital transformation in public administration and industrial zones, targeting a 30% reduction in permit processing times by 2026.

In real estate, developers report mixed signals. Demand for high-end apartments in Algiers and Oran remains strong, with average prices at DZD 120,000 per square metre in the capital’s Hydra district and DZD 85,000 in Oran’s city centre. By contrast, secondary market activity in Constantine and Annaba shows signs of oversupply, with inventory turnover exceeding 18 months. The discrepancy is attributed to migration flows and public-sector housing programs concentrated in coastal regions.

Innovation and industrial expansion

Algeria’s first domestic tire producer, EURL Rouiba Pneus, will exhibit at CITEXPO in Algiers from 27–30 May 2024. The company, a joint venture between Algeria’s National Company for Rubber and Plastics (ENRP) and a Turkish partner, plans to begin commercial production in Q4 2024 at a plant in Rouiba, near Algiers. Initial capacity is set at 150,000 units per year for passenger car tires, rising to 300,000 by 2026. The project received DZD 12 billion (USD 90 million) in state-backed financing and a 15-year tax holiday.

In agro-processing, Algerian investors are finalizing plans to build three cashew nut processing plants in Tanzania, targeting export markets in Europe and the Gulf. The first facility, with capacity of 10,000 tonnes per year, will be located in Mbeya and is expected to start operations in Q2 2025. The project is led by Algeria’s National Company for Foodstuffs (ENSA) in partnership with Tanzanian state-owned SIDO. Algeria will supply the processing equipment under a USD 18 million credit line from the Algerian-Tunisian Investment Bank.

On solar, Algeria’s state-owned oil company Sonatrach and the National Agency for Renewable Energies (NEAL) announced a joint tender for 1 GW of solar PV projects in the south, with bids due by 15 July 2024. Pre-qualification requires 30% local content and a minimum 25-year power purchase agreement. The tender follows the commissioning of a 30 MW pilot plant in Djanet in March 2024. Algeria’s solar roadmap targets 15 GW of installed capacity by 2030, up from 500 MW currently.

Culture, heritage and social conditions

Wildfire response teams reported on 24 May that 147 of 193 fires had been extinguished across 11 wilayas since 18 May. The fires, concentrated in Tizi Ouzou, Béjaïa and Sétif, destroyed 4,200 hectares of forest and led to the temporary evacuation of 1,800 residents. Civil protection forces mobilized 8,500 personnel and 1,200 vehicles, including drones for thermal mapping. The Solidarity Ministry activated psychosocial support teams in 14 wilayas, with 2,300 families receiving emergency cash transfers of DZD 50,000 each.

Cultural preservation efforts continue in the Sahara. The old town of Ghadames, a UNESCO World Heritage site, remains a focus of conservation funding under a 2023 agreement with Italy’s Ministry of Culture. Restoration work on the historic mosque and souks is 60% complete, with completion scheduled for December 2024. Separately, the Djanet Oasis welcomed 15,000 visitors in Q1 2024, up from 12,000 in the same period last year, driven by increased domestic tourism and improved road access.

On literature, the case of author and activist Mohamed Mouloudj—described by French media as the “Voltaire of the Arabs”—remains unresolved. Mouloudj, sentenced to 10 years in prison in December 2023 on charges of “undermining national unity” and “spreading false information,” is incarcerated in Tlemcen. His detention has been criticized by Reporters Without Borders and PEN International, but no ruling party officials have commented on the case.

Diaspora and cross-border signals

Algerian expatriate organisations report a 12% increase in remittances year-on-year in Q1 2024, reaching USD 2.1 billion. France, Canada and Germany account for 65% of flows, with remittances to Algeria now exceeding foreign direct investment in sectors such as retail and real estate. The trend follows the relaxation of foreign exchange rules allowing recipients to convert up to USD 10,000 annually into euros without prior approval.

Moroccan farmers displaced by land disputes near the Algerian border demonstrated in Figuig on 21 May, alleging that new solar farm construction in Algeria’s extreme south has encroached on traditionally used pastures. Algerian authorities have not responded publicly, but the incident has been flagged in diplomatic notes exchanged between Algiers and Rabat.

Key takeaway for entrepreneurs

Private sector investors should note that capital controls remain binding, but import windows for essential inputs have widened marginally. Solar and agro-processing present the clearest near-term opportunities, with state-backed financing and tax incentives available. Domestic manufacturing, especially in construction materials and pharmaceuticals, is prioritised in government plans, offering potential partnerships with public entities.