Algeria set to join WTO ?

Algeria began negotiations for membership in the World Trade Organization (WTO) in 1987 but progress was delayed by the waves of terrorism that ravaged the country in the 1990s. Talks are due to resume at an accelerated pace in May. In an attempt to make headway, Algerian Prime Minister Ahmed Ouyahia even went to Brussels to seek the support of the European Union as provided for under the terms of the recent EU-Algeria Association Agreement effective since 1 September 2005. This free-trade agreement will help open up borders to EU goods in stages. And the acceleration of the process of admission to the WTO will lead to both tariff cuts and greater legal security for foreign operators. “Algeria needs Europe just as Europe needs Algeria,” says President Bouteflika, who emphasises the need to strengthen cooperation between the two shores of the Mediterranean.

A hydrocarbon dominated economy
Algeria has undergone profound economic changes since its independence. In 1962 the economy was based primarily on agriculture; the country enjoyed food self-sufficiency and exported huge amounts of wine and citrus fruits. Today, although Algeria still produces cereals, fruits, vegetables and tobacco, a good portion of its food needs must be covered by imports. Since the discovery of large fossil fuel deposits in the Western Sahara in the 1950s, Algeria has become one of Africa’s main oil and gas producers, with oil accounting for 95% of Algerian exports. The country is a member of OPEC (Organization of the Petroleum Exporting Countries). The United States has a strong foothold in Algeria in the hydrocarbon sector and is encouraging authorities to accelerate the process of economic liberalisation. For its part, Algeria has turned to the United States for help in asserting its good faith in the opening of its economy. The Algerian Minister of Foreign Affairs was in Washington recently to ask the administration to help with the stalled WTO application. Algeria knows very well that without the green light from the United States it will never be admitted.

A MEDEF delegation in Algeria in May
Thanks to its sound financial situation, Algeria is sparking growing interest on the part of foreign countries such as Germany, Italy, Turkey, Spain, and even China and India. For some time now a steady succession of business delegations has been streaming to Algeria. French employers are also realising how much is at stake. A delegation of French bosses has been organised by the employers’ group MEDEF International, which considers that the Algerian market has great potential. It arrives in Algiers in early May. Although Algeria is France’s leading Arab partner - way ahead of second-ranking Morocco - not many French businesses have set up there. Only a hundred or so companies operate in the Algerian market today.