ambitious

Algeria: Ambitious Goals, Investor Skepticism

Africa’s largest country offers opportunity for investors willing to navigate heavy bureaucracy and an unpredictable business environment.

In July, Baladna, a Qatari firm famous for raising cows in the desert, signed a $500 million deal with Algeria’s National Investment Fund to launch the first phase of a $3.5 billion agro-industrial project in the Adrar region. Spanning 117,000 hectares and housing 270,000 cows, the mega-farm aims to cover half of Algeria’s demand for powdered milk and create 5,000 jobs.

The landmark project, held 51% by Baladna and 49% by Algeria’s Ministry of Agriculture, perfectly embodies what Algiers wants: to boost local production with the help of foreign partners while retaining substantial government control over the economy.

With a population exceeding 46 million and roughly a million new births every year, Algeria is one of Africa’s biggest consumer markets—and Africa’s largest country by land area. Investors looking to enter can count on cheap labor, relatively high purchasing power compared to the rest of the continent, low energy costs thanks to state subsidies, and limited competition.

“Just go to any Algerian supermarket and check how many brands of yogurt you will find—there is maybe three,” says Kamel Haddar, an Algerian serial entrepreneur. “In Morocco or Egypt there are 10 times more. So, you’ve got a big market, little competition, low costs … what more do you want? It’s basically like an open bar.”

Over the past decades however, Algeria has struggled to attract overseas capital. A civil war in the 1990s and the restrictive 49/51 ownership law introduced in 2009, which forced foreign investors to take on a local majority partner, have kept many potential investors reluctant to take a chance.

The ownership law was repealed in 2020 (except in “strategic” sectors like hydrocarbon, mining, large transportation infrastructure, pharmaceuticals, and defense) and the government has pledged to open the economy, but FDI remains lower than the authorities might have hoped. According to the International Monetary Fund, inward FDI has averaged just 0.4% of GDP over the past five years.

That leaves Algeria’s economy largely state-led and dependent on hydrocarbons, which made up 92% of exports and half of fiscal revenues last year. Following global energy prices, growth is expected to slow slightly to 3.4% in 2025, down from 3.6% in 2024. State-owned enterprises control key parts of the economy while a sprawling system of subsidies, including for basic goods, housing, and pensions, absorbs the bulk of public spending.

Algeria knows its model is unsustainable. Falling energy prices and mounting fiscal pressure have pushed the authorities to accelerate reforms to diversify the economy and encourage private-sector growth. In 2023, new land and procurement laws were enacted to improve business clarity while a one-stop digital platform for investors that provides key information on how to invest in some sectors and lists the investment incentives, tax exemptions, etc. was launched.

Algiers has set itself ambitious goals: to boost non-hydrocarbon exports to $29 billion by 2030 from $5.1 billion in 2023 while introducing new logistics platforms and simplified trade procedures. The government aims for 30% to 40% of electricity to come from renewables by then as well.

Despite still being subject to the 49/51 law, the energy sector remains the most attractive to foreign investors. US oil majors ExxonMobil and Chevron are reportedly finalizing a major agreement with the Algerian national oil company, Sonatrach, to explore shale gas, potentially unlocking the world’s third largest reserves.

Beyond hydrocarbons, the government is pushing for diversification in agriculture and manufacturing under a “Made in Algeria” policy.

“Everything related to imports is complicated because the state wants to favor products made in Algeria, but for those who produce locally, there are big margins and strong growth ahead,” Haddar says. International names including Coca Cola, Nestlé, Heinz, Pepsico, Danone, Carrefour, Orange, and car makers Renault, Peugeot, and Volkswagen have already established local operations.

“Companies have been setting up for the past 20 years, but it is still not enough,” says Rachid Sekak, financial consultant and former CEO of HSBC Algeria. “The potential for import substitution is everywhere. In terms of consumer goods, a lot remains to be done in sectors like food, agriculture, automobiles.”

Vital Statistics
Location: North Africa
Neighbors: Morocco, Tunisia, Mauritania, Mali, Niger, Libya, Western Sahara
Capital City: Algiers
Population (2024): 46.8 million
Official Languages: Arabic and Tamazight (French is also widely spoken)
GDP per capita (2024): $5,631
GDP growth (2024): 4%
Unemployment Rate (2024): 11.4%
Currency: Algerian dinar
Investment promotion agency: Algerian Agency for Investment Promotion (AAPI)
Corruption perception index rank (2024): 107th
Pros
Dynamic demography
Reform plans
Tax incentives and subsidies
Proximity to Middle East and African markets
Little corruption
Big opportunities in all sectors of the economy
Cons
Heavy state bureaucracy and public sector
High level of corruption and arbitrary decisions
Economy heavily dependent on energy and exposed to global commodity prices
Exposure to climate risks
Large informal sector
Black market exchange rate
Low level of advancement in digitalization
On FATF gray list since October 2024

Sources: World Bank, IMF, Transparency International

While Europe remains Algeria’s primary trading partner, ties with the Global South are expanding. China is now Algeria’s largest supplier, accounting for 22.9% of imports, and Chinese companies including Huawei, Sinopec, and ZTE have opened shop.

Turkey is another major partner, with more than $21 billion invested across 600 projects. Over 1,700 Turkish companies currently operate in Algeria and bilateral trade between the two countries is expected to reach $10 billion this year. To support the growing business ties, Ziraat Bankasi became the first Turkish bank licensed to operate in Algeria early this year.

Algiers has also joined the African Continental Free Trade Area (AfCFTA); it hosted the Intra-African Trade Fair in September, signalling growing regional ambitions south of the Sahara.

Financial Sector Reform

There is also reform momentum in the financial sector. The establishment of a Startup Ministry and a state-backed venture capital fund in 2020 marked a turning point. The government aims to welcome 20,000 startups by 2030.

“It’s a fast-growing market that is supported by both the state and by the private sector,” Haddar observes, “but we are still at the beginning. The next step will be for international VCs to set up a presence.”

A new Monetary and Banking Law passed in 2023 smooths the way for development of Islamic and digital financial products. Islamic finance currently represents about 3% of total assets, but new entrants including Tunisia’s Bank Zitouna, owned since 2018 by Qatar’s Majda Holding, are expected soon. On the digital front, opportunities are opening for fintechs and online banks, but digital banks face strict conditions. They can only offer payment services, must have a 30% local banking partner, and must require minimum capital of 10 billion dinars ($75 million).

Despite the reforms, public banks still dominate the market, holding about 85% of deposits. Privatization through IPOs has begun, with listings of Banque du Développement Local in March and Crédit Populaire d’Algérie last year, but the process remains mostly symbolic.

“It doesn’t change things fundamentally,” Sekak argues, “because newcomers don’t have the capacity to bend board meeting decisions. It has, however, had important effects on transparency and disclosure.”

From a foreign investor’s perspective, while Algeria seems willing to enact some reforms, deep-rooted barriers persist.

“The potential is huge,” says a foreign investor who has supported multi-million projects in Algeria for over 10 years but is now exiting the market. “There are very few countries like this left in the world. The market is practically virgin and there is a lot of money. But unfortunately, the authorities are not open to business. Big companies have opened—car factories, for example—but sometimes the authorities decide to ban imports of certain raw materials or some spare parts, and that makes local production impossible.”

Investing in Algeria can yield substantial returns, but there are risks. The market is unpredictable, with the authorities often making unliteral decisions that can reshape entire industries overnight.

“Working in Algeria means you must be able go to sleep with one law and wake up with a different one,” the investor says. “So you enter a market that has a certain legal framework, and then things change completely. It’s a big problem you must factor in.”

The IMF echoes these concerns, pointing to a lack of clarity in bidding processes. In its latest review, it suggests, “Addressing issues related to transparency, institutional independence, and enforcement of rules could help improve public trust and institutional effectiveness. Ensuring that legal and regulatory frameworks are applied fairly and efficiently would also support private-sector development, investment, and overall economic resilience.”

Another concern is Algeria’s vast informal sector and cash economy: one of the reasons it landed on the global Financial Action Task Force’s Gray List last year.

While Algeria’s economic potential is significant, its institutions have yet to catch up with its ambitions. The country’s greatest challenge is not capital or capacity, but governance. Until transparency improves, the state further loosens its grip on the economy, and the rules of the road become more stable, investors will continue to face uncertainty.

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Trump sets ambitious deadline for coronavirus vaccine

President Trump outlined an ambitious effort Friday to develop, produce and distribute a fully-approved COVID-19 vaccine by the end of the year, a timeline that even those in charge of the project acknowledge is highly unlikely.

Trump said the $10-billion program would have a goal of producing 300 million doses to administer to Americans by January.

Officials said the initiative would seek to streamline and coordinate the work of government agencies, private industry and the military. A former pharmaceutical executive and an Army four-star general will head the effort, which the White House called Operation Warp Speed.

“We’re looking to get it by the end of the year if we can,” Trump said in the Rose Garden. “Tremendous strides are being made.”

But Trump also hedged on the importance of the effort, declaring that America is already on the rebound from the coronavirus outbreak, which has killed about 87,000 Americans and cratered the economy.

“I want to make one thing clear — vaccine or no vaccine, we’re back,” he said. He repeated a claim he’s made since the first U.S. coronavirus cases were reported three months ago, that the virus will eventually “go away” on its own.

“I don’t want people to think this is all dependent on a vaccine,” he said.

Public health officials worry about bringing a potential vaccine to market without several rounds of clinical trials to ensure that it is safe and effective.

The National Institutes of Health says one or two possible vaccine candidates could be ready for large-scale testing by July, with several others likely to follow. Elsewhere around the world, about a dozen vaccine candidates are teed up for small-scale testing or safety studies.

The tests are necessary to determine proper dosages and to avoid negative side effects. The process usually takes several years, but some of the world’s largest pharmaceutical companies are working with governments around the globe in an effort to speed up the search.

Dr. Amesh Adalja, an infectious diseases physician at Johns Hopkins Center for Health Security, said setting a deadline for a vaccine is “dangerous because you’re going to give people a false sense of hope and security.”

But he said it’s possible scientists can accelerate the usual timeline given changes in laboratory practices, including the use of “vaccine platform technologies” that allow researchers to test various candidates without developing each one from scratch, and the decision to prepare factories for mass production before officials know for certain that a particular vaccine will work.

“All of that’s going to shave time off, but everything has to go perfectly,” he said.

Dr. Jere W. McBride, an infectious diseases specialist at the Sealy Institute for Vaccine Sciences at the University of Texas, noted that no vaccine has been “developed that fast before.”

“Everything has to work and in science that’s often not the case,” he added. “Is it possible? Certainly.”

Officials involved in the new initiative echoed the president’s optimism.

Moncef Slaoui, who was chairman of vaccines at British pharmaceutical giant GlaxoSmithKline until 2017, will lead the effort. He said early clinical trials have been encouraging.

“These data make me feel even more confident that we will be able to deliver a few hundred million doses of vaccine by the end of 2020,” Slaoui said. “And we will do the best we can.”

Gen. Gustave Perna, the commanding general of the Army’s Materiel Command, will serve as chief operational officer. He called the project “a herculean task,” but expressed confidence in its success.

“Winning matters and we will deliver by the end of this year a vaccine at scale,” said Defense Secretary Mark Esper.

Part of the effort involves using the military to boost production capacity before the vaccine is ready in order to expedite distribution when one is determined safe and reliable.

Dr. Stephen Hahn, the commissioner of the Food and Drug Administration, said Tuesday at a Senate hearing that his agency would evaluate about 10 vaccine candidates in early studies, and then select three to five to progress into larger studies in humans.

Dr. Rick Bright, the ousted former head of the government agency charged with developing vaccines, has cast doubt on the administration’s rush to find a vaccine.

“My concern is if we rush too quickly, and consider cutting out critical steps, we may not have a full assessment of the safety of that vaccine,” Bright told a House committee on Thursday. “So it’s still going to take some time.”

Trump’s comments in the Rose Garden were at times drowned out by loud horns from truckers parked near the White House who were protesting reduced shipping rates. Trump dismissed the din as a “sign of love” for him.

Dr. Deborah Birx, the White House coronavirus response coordinator, and Dr. Anthony Fauci, the government’s top immunologist, stood behind Trump but did not speak. Both wore face masks, although Trump did not.

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Mamdani announces transition leaders, vows to deliver on ambitious agenda

Fresh off winning New York City’s mayoral election, Zohran Mamdani announced Wednesday that a team including former city and federal officials — all women — would steer his transition to City Hall, and that he would “work every day to honor the trust that I now hold.”

“I and my team will build a City Hall capable of delivering on the promises of this campaign,” the mayor-elect said at a news conference, vowing that his administration would be both compassionate and capable.

He named political strategist Elana Leopold as executive director of the transition team. She will work with United Way of New York City President Grace Bonilla; former Deputy Mayor Melanie Hartzog, who was also a city budget official; former Federal Trade Commission chair Lina Khan; and former First Deputy Mayor Maria Torres-Springer.

With his win over former Gov. Andrew Cuomo and Republican Curtis Sliwa, the 34-year-old democratic socialist will soon become the city’s first Muslim mayor, the first of South Asian heritage, the first born in Africa and the youngest mayor in more than a century.

He now faces the task of following through on his ambitious affordability agenda while navigating the bureaucratic challenges of City Hall and a hostile Trump administration.

“I’m confident in delivering these same policies that we ran on for the last year,” he said in an interview earlier Wednesday on cable news channel NY1.

More than 2 million New Yorkers cast ballots in the contest, the largest turnout in a mayoral race in more than 50 years, according to the city’s Board of Elections. With roughly 90% of the votes counted, Mamdani held an approximately 9 percentage point lead over Cuomo.

Mamdani, who was criticized throughout the campaign for his thin resume, will now have to begin staffing his incoming administration and planning how to accomplish the ambitious but polarizing agenda that drove him to victory.

Among the campaign’s promises are free child care, free city bus service, city-run grocery stores and a new Department of Community Safety that would expand on an existing city initiative that sends mental health care workers, rather than police, to handle certain emergency calls. It is unclear how Mamdani will pay for such initiatives, given Democratic Gov. Kathy Hochul’s steadfast opposition to his calls to raise taxes on wealthy people.

On Wednesday, he touted his support from Hochul and other state leaders as “endorsements of an agenda of affordability.”

His decisions around the leadership of the New York Police Department will also be closely watched. Mamdani was a fierce critic of the department in 2020, calling for “this rogue agency” to be defunded and slamming it as “racist, anti-queer & a major threat to public safety.” He has since apologized for those comments and has said he will ask the current NYPD commissioner to stay on the job.

Mamdani has already faced scrutiny from national Republicans, including President Trump, who have eagerly cast him as a threat and the face of a more radical Democratic Party that is out of step with mainstream America. Trump has repeatedly threatened to cut federal funding to the city — and even take it over — if Mamdani won.

”…AND SO IT BEGINS!” the president posted late Tuesday to his Truth Social site.

Mamdani, for his part, said at his news conference that “New Yorkers are facing twin crises in this moment: an authoritarian administration and an affordability crisis,” and that he would tackle both.

While saying he was committed to “Trump-proofing” the city — to protect poor residents against “the man who has the most power in this country,” as he explained — the mayor-elect also reiterated that he was interested in talking to the president about ”ways that we can work together to serve New Yorkers.” That could mean discussing the cost of living or the effect of cuts to the SNAP food aid program amid the federal government shutdown, Mamdani suggested.

“I will not mince my words when it comes to President Trump … and I will also always do so while leaving a door open to have that conversation,” Mamdani added.

Mamdani also said during his news conference and interviews that he had not heard from Cuomo or the city’s outgoing mayor, Eric Adams. He did speak with Republican candidate Curtis Sliwa.

A spokesperson for Cuomo, Rich Azzopardi, said he would “let their respective speeches be the measuring stick for grace and leave it at that.”

In his victory speech to supporters, Mamdani wished Cuomo the best in private life, before adding: “Let tonight be the final time I utter his name, as we turn the page on a politics that abandons the many and answers only to the few.”

Asked about the comments Wednesday on NY1, Mamdani said he was “quite disappointed in the nature of the bigotry and the racism we saw in the final weeks.” He noted the millions of dollars in attack ads that were spent against him, some of which played into Islamophobic tropes.

Izaguirre and Colvin write for the Associated Press. AP writers Jake Offenhartz and Jennifer Peltz contributed to this report.

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