Algeria: Regime loses control of the economy, construction sector collapses

Posted On 14 October 2019

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French version here–  By Arezki Daoud – 10 October 2019: While the Algerian government is working to pass its 2020 budget and an extremely controversial petroleum law at a breath-taking speed, the statistics on the construction sector in the country are chilling. The data are now clear evidence of a government that has lost total control of its executive prerogatives. Instead, it is focusing on its defense posture in an effort to survive the relentless public onslaught that is demanding a complete regime change. 

The data on the construction sector are significant in that they show lack of capacity to roll out solutions to at least prevent further erosion in critical sectors. More than 60% of companies operating in the sector have ceased their activities. The data was shared by Mouloud Khaloufi, the head of the General Association of Algerian Entrepreneurs (Association générale des entrepreneurs algériens – AGEA). Khaloufi noted that “every week, there are companies that are closing their doors and all the workers are laid off.” AGEA said it has been pressuring the government and offered 14 proposals to get out of the crisis, but authorities appear tied and unable to formulate a policy to save the sector. 

AGEA says the crisis is not just affecting the construction firms, but also the companies that are upstream, namely construction materials manufacturers. Translated into actual number, at least 1,360 construction companies have ceased operating, and all building material manufacturers are virtually shut down. 

AGEA tied the sector’s crisis to the political crisis facing Algeria since February 2019.  It said “The companies are totally at a standstill. Nobody wants to work. They are waiting for the election with a legitimate president. Who says legitimate president says legitimate government, with a five-year program.”

The collapse of the construction sector, and all the other industries, are either a deliberate sabotage or a sign that the regime can no longer administer.  The real answer is a little bit of both.  Regime leaders and operatives are certainly working to apply punitive actions against a population that is adamant about necessity to change the entire regime.  In addition to these punitive actions, just as it is being done with the petroleum law, the executive branch of the regime, namely Prime Minister Bedoui, has its hands tied and does not have any means to maneuver, legal and otherwise.

 

 

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Written by The North Africa Journal

The North Africa Journal is a leading English-language publication focused on North Africa. The Journal covers primarily the Maghreb region and expands its general coverage to the Sahel, Egypt, and beyond, when events in those regions affect the broader North Africa geography. The Journal does not have any affiliation with any institution and has been independent since its founding in 1996. Our position is to always bring our best analysis of events affecting the region, and remain as neutral as humanly possible. Our coverage is not limited to one single topic, but ranges from economic and political affairs, to security, defense, social and environmental issues. We rely on our full staff analysts and editors to bring you best-in-class analysis. We also work with sister company MEA Risk LLC, to leverage the presence on the ground of a solid network of contributors and experts. Information on MEA Risk can be found at www.MEA-Risk.com.

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