Algeria’s week—energy, reforms, and African trade shifts

Energy and infrastructure drive Algeria’s African and European ties

Separately, Algeria’s largest air conditioner factory, Condor Electronics, secured a 250,000-unit order from European buyers. The plant in Bordj Bou Arréridj has an annual capacity of 1.2 million units. Condor, a private Algerian firm, exports to 40 countries. The deal follows Europe’s shift away from Chinese suppliers due to tariffs and supply chain risks.

Algeria also advanced the Western Mining Railway, a 1,050 km line connecting Tindouf’s iron ore deposits to Béchar. The project, led by state-owned SNTF, aims to transport 20 million tons of ore annually to African markets. Construction began in 2022; completion is expected by 2027.

Diplomatic moves reflect Algeria’s regional strategy

Relations with Spain improved after a 2022 diplomatic rupture over Western Sahara. Spain’s foreign minister visited Algiers in June 2024 to discuss gas supplies and migration. Algeria supplies 25% of Spain’s gas, up from 13% in 2021. Trade between the two countries reached €8.2 billion in 2023, a 19% increase from 2022.

Morocco-Algeria tensions persisted. Evicted Moroccan farmers protested near the disputed border, claiming Algerian authorities seized 1,200 hectares of land. The area, near Figuig, has been a flashpoint since Algeria closed the border in 1994. No official response from Algiers.

Economic reforms progress, but risks remain

The U.S. average tariff rate on Algerian goods is 3.2%, unchanged since 2020. Algeria’s main exports to the U.S. are crude oil (78% of total), fertilizers, and dates. Non-oil exports totaled $120 million in 2023, up 8% from 2022.

Algeria’s financial reforms earned praise from the U.S. State Department. Foreign exchange reserves stood at $72 billion in June 2024, down from $82 billion in 2022. The government aims to reduce hydrocarbon dependence from 93% of exports to 80% by 2027.

Climate and desertification shape long-term economic risks

Algeria’s Civil Protection reported 193 wildfires in July 2024, with 147 extinguished by August 1. The fires affected 12 wilayas, including Tizi Ouzou and Béjaïa. No economic damage estimates were released. Algeria’s forest cover is 11% of its land area, down from 15% in 1990.

Digital and tourism sectors see incremental growth

In digital, the Finance Law 2026 mandates electronic payments for all government transactions by 2026. The Central Bank reported 12 million active mobile payment accounts in June 2024, up from 8 million in 2022. Algeria’s fintech sector includes 42 licensed startups, with total transaction volume of $1.2 billion in 2023.

Medical research and local industries gain attention

Political stability and business environment

Political Islam remained a topic of debate. A report by the Carnegie Endowment noted Algeria’s “quietist” Salafism, which avoids political engagement, contrasts with “firebrand” factions advocating for Sharia law. The government monitors mosques; 1,200 imams were trained in state-approved curricula in 2023.

Week’s balance

Key takeaway for entrepreneurs
Algeria’s Finance Law 2026 reduces barriers for foreign investors in non-hydrocarbon sectors, with 100% ownership allowed in most industries. The e-visa and mandatory electronic payments create opportunities in tourism and fintech. Energy and infrastructure projects, including the TSGP and Western Mining Railway, may offer supply chain and logistics contracts. Climate risks require adaptation strategies for agriculture and renewable energy ventures.