Economic Trends

Algeria’s market of 35 million inhabitants, energy wealth, and growing demands for modern infrastructure have generated interest from governments and companies around the world. On one hand, Algeria’s economy is expected to grow at a healthy rate of 3-5% over the next several years based on higher world prices for oil. As Algeria is a non-traditional market for many exporters, Algeria can open doors in several new sectors such as health & nutrition, franchising, and home & housewares.

Algeria is a market that requires patience and determination, it is advised to demonstrate a long-term commitment to maximize their chances of success. Algeria remains one of the few countries not to have joined the WTO. It joined the Arab Free Trade Area at the beginning of 2010.

The Government has recently implemented new controversial measures concerning trade and investment. Algeria does not impose general performance requirements on foreign investments. However, the national energy company Sonatrach must be a majority shareholder in any venture in the hydrocarbons sector. Furthermore, statements made by the president and prime minister in mid-2008 suggest that future foreign investments in Algeria in any sector will require Algerian majority partnership.

The investment code provides a number of incentives for investment in Algeria, primarily related to VAT and other tax exemptions for periods of time that are dependent on the type of investment made and the nature of the package agreed two between the investor and the National Agency for Investment Development (ANDI).