Algerian efforts to diversify the economy will be slow

Significance

Beijing is already involved in several investment projects in Algeria, largely focused on exploiting the country’s untapped mineral resources. China will reportedly now invest USD36bn in Algeria across several sectors, including manufacturing, new technology, transport and agriculture. Tebboune’s trip to China was preceded by a stop in Qatar and followed by a brief visit to Turkey, also focused on economic cooperation.

Impacts

• Iron ore, phosphate and zinc reserves could eventually boost non-hydrocarbons exports, but with limited added value to the wider economy
• Tebboune’s engagement with China will reinforce the state sector but do little to support the private sector.
• Private businesses will be tainted by association with the corruption of the era of former President Abdelaziz Bouteflika (1999-2019).