August 13, 2009
Algeria: little steps to autarky?
Now that the Algerian govenrment has taken such very clever moves as banning consumer credit and rendering imports stunningly difficult by imposing highly unfavourable credit / financing terms on importers (except some privledged exceptions) perhaps this little deal will work: Abu Dhabi fund plans Algeria auto plants
I rather like the summary below the headline information:
Aabar Investments said the Algerian venture would be led by German engineering group MAN Ferrostaal and produce up to 10,000 cars and trucks a year in the oil-rich north African country.
There has also been little economic development in the country, which was for years shackled by a socialist economy.
Meanwhile, Algeria has decreed it would take a majority stake in all new investments and would have the right of first refusal when investors want to sell a concern.
My conversations this week have been ... interesting. Just about the entire private sector (and certainly all foreign investors are) is in an uproar. So for the Comb Over Regime has managed to put itself in violation of at least 5 treaty engagements with EU under its Association Agreement, invalidate several Anglo American investment contracts in part (of course the Algerians claim they're merely changed some details, all is fine.... except of course they broke the contract terms, queerly the Gov types really don't seem to get the import of that). It's absolute chaos, and when one talks to people in charge of say FX rules they simply shrug - even they have no idea what will be applied, what won't...
Algeria, fairly the poster boy of incoherent and bad economic policy. With a flair for the unpredictability of incoherent self-contradiction.
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Do you have any sense of there being any significant group in Algeria which "gets it", economically? Certainly the present regime doesn't seem to be either interested in or capable of real reform, and the rest of the political field (apart from being a total shipwreck) seems even worse, either wanting to insulate the economy further on ideological/nationalist grounds, or being too preoccupied with alcohol bans, Palestine and public indecency to even notice the problem.
Posted by: alle at August 15, 2009 04:36 AM
No, I am afraid there seems to be no group that really "gets it" - some exporters, but the government has structured import-export regulations (in combination with a stunningly poorly run port logistics - thanks to the Gov again) in such a way that they're essentially strangling off that.
So the playing field seems to be largely confined, politically, to political action and discourse that wants to rerun the 1970s, just because that worked so well last time....
Posted by: The Lounsbury at August 15, 2009 08:02 AM
How very depressing.
Posted by: alle at August 16, 2009 02:26 PM
Yes, indeed it is.
They're just muddling along in a terribly incoherent fashion (and half-hearted largely incoherent semi-liberal economic reforms unfairly have been getting the blame for issues that are squarely in governmental incompetence and incoherence).
One real problem is there is no system of dialogue in the country, laws, decrees, whatnot are just rushed out, without real discussion - as someone said, "Because Boutef looked cross one AM"
Really serious handicap.
Posted by: The Lounsbury at August 17, 2009 08:15 AM