International Monetary Fund calls for further reforms in Algeria

The International Monetary Fund has called on the Algerian authorities to speed up reforms to improve the business environment in the country and clarify the role of public banks considering that the way the way with which they are managed lacks transparency.

• In a document sent to the Algerian government last week, the Fund’s Executive Board has indicated that the new legislation included in the supplementary financial law in relation to foreign investments, will have dangerous repercussions on the financial and economic reforms initiated by the Algerian authorities.
• The Fund went on saying that denying the majority of shares for foreign investments over projects in Algeria will bare the route for serious investments and transfer of technologies in the country.
• The Executive Board thinks that the idea of cancelling consumer credits could hamper the financial sector’s development, calling starkly for nullifying the decision.
• The IMF has revealed that Algeria has registered a strong and sustainable economic growth owing to giant public expenditures, but kept facing important challenges among them registering growth outside the hydrocarbons sector. The IMF admitted that Algeria has succeeded in keeping inflation rates at less than 6% and save huge sums of money after shrinking drastically its external debts.
• The IMF experts expect a Gross Domestic Growth of 5.5% outside hydrocarbons during the year 2010, while hydrocarbons production will witness a retreat owing to the new world economic order.
• However, the experts have concluded that the Algerian authorities have to go deeper in their economic reforms and speed up the pace.