The West Mediterranean, a basin for the mixing of cultures and fruitful dialogue between different civilisations.
Following a Meeting of the 5+5 in Marseille 23 and 24 June 2019, this contribution was my intervention as member of Algeria’s delegation headed by the Minister of Foreign Affairs before the various foreign representations and the President of the French Republic as part of The 5+5 Dialogue. A sub-regional forum for the ten Western Mediterranean countries that take part since its creation, five from the north of the Mediterranean (Spain, France, Italy, Malta and Portugal) and five from the southern shore (Algeria, Libya, Morocco, Mauritania and Tunisia), all working in the hope for concrete results for the benefit of both sides of the Mediterranean western basin.
The Algerian delegation delighted with Marseille, the seat of different cultures and venue for this final meeting where in a few months, we have carried out an important work showing the vitality of civil society in the western Mediterranean. It was not that obvious at the outset. From April to June 2019, civil society in the western Mediterranean on both sides worked together to bring concrete solutions to the region “through the implementation of concrete projects for human, economic and sustainable development. We hope that all of these reflections and proposals for initiatives will be shared today with leaders at this summit in Marseille to determine which ones will be implemented as a priority, the means and mechanisms to be implemented to forge strong links in all areas around the Mediterranean in order to boost cooperation, based on the conviction that civil society must be fully involved in the definition of a new “positive” agenda. I recall that recently with renowned experts from Algeria, Morocco, Tunisia, Mauritania and Libya and 15 European personalities during 2015 and 2016, we produced under my direction and that of my friend Camille Sari two books (1050 pages), one on political institutions, the other economic in all its diversity entitled “The Maghreb in the face of geostrategic issues published by Harmattan Editions, following on from my contributions on this subject at the level of The French Institute of International Relations between 2011 and 2013 on Europe-Maghreb relations.
The ideas are not
new but unfortunately have not been realized. I recall that during a meeting
almost similar at the UNESCO in 1993 at the initiative of Pierre Moussa with Mr.
Thom Bekki then Vice-President of South Africa on the theme – Africa-Maghreb as
part of the strategy Euro-Mediterranean, I had advocated in my speech the
creation of both a Euro-Mediterranean university as a place of fertilization of
cultures, against intolerance, and a Euro-Mediterranean bank and stock exchange
with financial instruments adapted to the situation for the realization of
concrete projects by promoting decentralized networks of economic, social and
cultural actors, involving international financial institutions and traditional
banks. I reiterate these proposals for
this summit of 5+5 in addition to the creation of an economic and social
council at the level of the Western Mediterranean (5+5) whose vocation is to
bring together the different segments of civil society, experience if successful
could be extended to a global civil society bringing together the different
regions of our planet in order to combat insecurity, migration and thus promote
a balanced and global solidarity space.
It is in this
context that I would like to welcome the initiative of His Excellency the President
of the French Republic, Mr Emmanuel Macron, to whom Algeria has given its
support from the outset. This initiative, it seems to me, is part of the new
transformation of the world, ecological challenges, the breakthrough of digital
and artificial intelligence to witness between 2025/2030/2040 a fourth global
economic revolution based on knowledge, which will influence all international
relations, recalling the conclusions of COP 21 and COP 22, which calls on all
humanity for a solidarity future. The 21st century will have three
strategic actors forging dialectical links: states that must adapt to
globalization (the centralized bureaucratic Hegelian state is outdated, the
North African states have unfortunately copied the French Jacobin system, a
blocking factor for reforms as shown by my friend Jacques Attali, the
international institutions that need to be renovated with the massive entry of
emerging countries including China, and civil society which will play an
increasingly important role more predominant, non-antinomic with the other two
players but complementary. The common hope is that this important meeting will
be able to turn the Mediterranean basin into a lake of peace, tolerance and
shared prosperity based on a win/win partnership far from any spirit of
domination, through tolerance and dialogue cultures of which I am deeply
Algeria is a strategic player in the Mediterranean and Africa since it played an essential role in the various meetings in preparation for the 5+5 meeting where it proposed concrete projects with a regional impact, favouring economic interests and the stability of the region, taking into account the transformation of the world. Algeria, endowed with the issue of Energy Transition, proposed projects from civil society, where the work of the Forum in Algiers organized in the form of four thematic sessions, namely: Renewable Energy and Energy efficiency; Electrical interconnections, Natural Gas as the engine of an energy transition and the digital transformation of the energy sector. It is that energy will be at the heart of the sovereignty of states and their security policies and their economic dynamics alter the balance of power on a global scale and affect political recompositions within countries as regional spaces. The energy transition refers to other subjects than technical, posing the societal problem. It can be viewed as the passage of human civilization built primarily fossil, polluting, abundant, and inexpensive energy, to a civilization where energy is renewable, scarce, expensive, and less polluting with the objective of eventually replacing energies stocks (oil, coal, gas, uranium) with flows of energies (wind, solar). This raises the problem of a new model of growth and consumption: all economic sectors and households are concerned. The important potentials of all forms of energy in the Mediterranean, that of wind or sun, or of fossil fuels present in its subsoil, can make this area contacts between millennia-old civilizations, which have always been subject to political tensions, a new energy region of the world, at the gates of Europe, Africa and the Middle East. Crossroads of three continents, fragile from an environmental point of view, the Mediterranean basin is also a region that provides energy, such as those of the wind or the sun, or fossil fuels present in its subsoil. The energy mix of tomorrow will be electrically dominant, as the electricity market is expected to increase by almost 80% by 2040. Solar thermal for export, combined with photovoltaic for internal consumption needs, is expected to be the most important resource for electricity generation. Hybridization with gas should already allow it to be competitive. Electric highways in continuous current to cross the Mediterranean could be used to meet the growing needs of Europe’s Mediterranean coast and superconductivity completed by liquid hydrogen cooling will be the most medium-term solution to meet the needs of Northern Europe.
After the mixed
results of the Barcelona Agreement and the Union for the Mediterranean, let us
hope that this summit can lead to concrete results for the benefit of the
people of the region. I am convinced only the culture of tolerance will allow
our space, in the face of the new challenges of globalization, to meet the
challenges of the 21st century in the face of fierce competition,
including the breakthrough of emerging countries, the rise of global terrorism
threat, the rise of protectionism detrimental to the growth of the world
economy, existing a dialectical link between security and development, to the
dangers of populism. Finally,
co-development in the Mediterranean via the continent Africa issue of the 21st
century can, as I pointed out recently in interviews with AFRICAPRESSE.PARIS
and the American
Herald Tribune, curb ensure security and avoid destabilization that would
have geostrategic repercussions for the entire Mediterranean and African
I wanted to stress during this meeting on behalf of Algeria, that a strategic player at the regional level will contribute to the success, based on a win-win partnership, of this enormous undertaking, an old dream, forging our common Mediterranean consciousness. I quote the conclusion of my speech: “Mr. President of the French Republic, you, who are the age of my son, hope that all together leaders of the 5+5 and civil societies of our region, supported by international institutions, will realize this old dream that I defend with the many Maghreb and European friends, for more than 30 years the Mediterranean, a place of mixing of cultures, tolerance and fruitful dialogue between different civilizations, our common destiny being to do business together.”
Finally, as I pointed out in an interview with Jeune Afrique, Paris on June 24, 2019, far from any vision of disaster, Algeria’s future holds immense hope as at the end of my interview, and I quote: “Our youth and the National People’s Army have shown unwavering maturity. But it is imperative to move beyond the current status-quo before the end of 2019 with transparent elections, as a longer transition period could inevitably lead the country to an economic and social drift. And as in economics, lost time is never caught back, the productive dialogue with concessions on both sides for Algeria being its benefit, accompanied by a profound restructuring of parties and civil society based on new networks, is the only way out of the current crisis.”
In North Africa’s political spheres, Algeria’s Bouteflika reaching his mandate end by April, stepping down from rule looks more like a bet placed on his health condition than any constitutional arrangement.
In next door Tunisia, the president has a history of brain strokes that also placed him on a wheelchair.
Youssef Cherifwrote on January 9th, 2019 that Less
than a year before the next general election, scheduled for late 2019, Tunisia
is again in crisis. The Arab world’s most promising democratic experiment can
still avert a political meltdown, but it needs help.
TUNIS – When anti-government protests swept across
the Arab world in 2011, Tunisia seemed poised to emerge better off. Yet, by
2013, the democratic process was almost derailed by unfulfilled economic
promises, political and ideological disagreements, and foreign meddling.
Fortunately, local and international mediation then helped to avert catastrophe and
pave the way for elections.
But less than a year before the next general
election, scheduled for late 2019,
the country is again in crisis. This time, however, mediators are either
disinterested in solutions or part of the problem. In a world focused on the
war in Syria, instability in Libya, Russian assertiveness, European
uncertainty, and the tweets of an isolationist American president, Tunisia has
faded from the headlines. Tunisia’s democratic breakdown would, one assumes,
attract international attention; but by then, it will be too late.
The current stalemate began soon after the December
2014 presidential election. In February 2015, President Beji Caid Essebsi,
founder of the secular political party Nidaa Tounes, struck a deal with Rached
Ghannouchi, president of the moderate Islamist Ennahda Party, to form a coalition government.
But soon after, Nidaa Tounes was beset by infighting and, in January 2016,
dozens of the party’s MPs resigned in protest, giving Ennahda a parliamentary majority.
Meanwhile, Prime Minister Youssef Chahed, Essebsi’s
protégé and appointee, has been challenging the 92-year-old president’s inner
circle, throwing Nidaa Tounes further into chaos. By
mid-2018, as the party’s turmoil peaked, Ghannouchi was supporting Chahed
rather than the president’s son and groomed heir, Hafedh Caid Essebsi. The
president, reacting either to a sense of betrayal or out of fear for his
legacy, responded by renewing his criticism of Ennahda and
by launching an investigation into allegations that Ghannouchi’s party is tied to terrorism.
Moreover, Essebsi and his clan embraced populist
rhetoric and restarted courting the anti-Islamist
Saudi-Emirati-Egyptian axis. Essebsi even endorsed a law to give
men and women equal inheritance rights, a measure that is supported by many
secular Tunisians and praised by the international community, but loathed by
Ennahda’s conservative base.
In a well-functioning democracy, an early election
would have been called in September 2018, when the governing coalition felt apart,
and perhaps as early as 2016, when Nidaa Tounes lost its majority in
parliament. But most Tunisian political parties suffer too much dissension or
are too weak to run. And the current ructions are even jeopardizing the work of
High Authority for Elections.
Tunisia’s political crisis is occurring alongside
an economic one. As Tunisia has moved from a controlled economy under
dictatorship to a transitional one marked by austerity measures and structural
reforms dictated by the International
Monetary Fund, corruption has spread and investors have fled. Today,
with public debt, unemployment, and inflation growing, strikes and protests are
increasingly common, and support for democracy – frequently
portrayed as the cause of the current tumult – has dwindled.
Ennahda, an economically liberal party that draws
important support from informal economic circles and outside the public sector,
backed the IMF’s economic reforms; the Tunisian General Labor Union (UGTT),
which represents public-sector workers, did not. Leftists and many remnants of
the former regime were also opposed. Chahed, meanwhile, was aggressive in
implementing the IMF-backed reforms, in part to win support from abroad. But
his approach put the UGTT, alongside old-guard politicians and some key
socioeconomic groups, on the same side as Essebsi. In fact, the UGTT led the
mediations during the crisis of 2013.
Foreign influence is another destabilizing factor.
Today, Tunisia is a geopolitical battlefield
for regional powers like Egypt, Turkey, and the Gulf states, and Tunisian
politicians occasionally take sides to suit their suitors’ goals. Broadly
speaking, Saudi Arabia and the UAE demonize Tunisia’s democracy and Ennahda,
while Qatar and Turkey laud both. Both camps have their clients in the country.
These players amplify coup rumors and delegitimize Tunisia’s political
independence, which adds to the public’s distrust
of the government. Back in 2013, the US, Europe, and Algeria limited the reach
of these countries. Ironically, in 2018, it is the US, the EU, and Algeria that
are rattled by internal divisions and terrified of foreign interference.
History holds many lessons for those navigating
Tunisia’s tumult, with some particularly apt parallels to be found in Russia’s
post-Soviet transition. There, during his final years in power, a weakened
Boris Yeltsin sought to secure his presidential legacy and save his family from prosecution. Hence, the
so-called “father of Russian democracy”
appointed then-Prime Minister Vladimir Putin, a former KGB officer, to succeed
him. Russia’s democracy never recovered.
Tunisia’s infighting and nepotistic policies have a
similar feel. The Arab world’s most promising democratic experiment can still
avert a political meltdown, but it needs help. Local and international
mediators guided Tunisia from turmoil once before. They must do so again.
The training which focused on handling, maintenance and the security aspects of flying drones, took place in Tunis from 19-30 November 2018
Eight pilots have successfully passed their drone flight training in Tunisia following a two-week intensive training period organized by the Ministry of Agriculture of Tunisia, the African Development Bank and Busan Techno Park.
The training which focused on handling, maintenance and the security aspects of flying drones, took place in Tunis from 19-30 November 2018. The eight were the first batch out of 40 candidates selected for the exercise, which envisages training a total of 400 young Tunisians by 2021.
The project will also see the setting up of a training center equipped with training drones as well as computer simulation tools for drone control. This center is expected to be upgraded to a center of excellence in drone technology. The training also focused on promoting drone-centered activities in Tunisia in view of promoting efficiency and effectiveness.
“It is very good training. I want to share my experience. I would like to participate in this project and contribute for the development of Unmanned Aerial Vehicles (UAVs) in my country Tunisia and my region, Africa,” said Lazhar Meskine, an air traffic management engineer, who was among the trainees.
After accumulating 20 hours of flight time and passing the practical flight, they obtained a “Drone Pilot Certificate” recognised by the Tunisian government. The four best trainees from this first batch will undergo further training for eight weeks to accumulate 100 hours of flight time. This will make them eligible to take the certification examination and qualify as drone pilot trainers.
The participants were highly enthusiastic about the training.
“I have also learned many things through Tunisian trainees. It gives us a great chance to understand the local situation for further projects by using drone technologies,” their instructor, Mr. Yong-ju Seo, added.
Korea (https://bit.ly/2EvaqV0) is a leading country in the development and use of Unmanned Aerial Vehicle (UAV) for real-time data collection and processing. Drones have been used in agriculture to provide fast and accurate data, helping to improve decision-making at all stages of a project, from preparation to implementation and evaluation.
The Oxford Business Group in the proposed article on Tunisia opting strongly for renewables. The country is one of those countries of the MENA not provided by natural oil resources in its territory. It is in the background of high solar radiation and growing demand for energy, that the North African countries are gradually becoming a big future solar market with Moroccan giant project currently being realised and Algeria’s planning a 4GW for obviously their respective domestic consumption but above all export to the nearby Europe.
We republished the article with our compliments to the publisher.
The recent submission of proposals for the construction of a new solar park project in Tunisia highlight the country’s potential as a location for renewable energy projects at a time when domestic demand for power is rising rapidly.
In early August UK company TuNur submitted its proposal to the Ministry of Energy, Mines and Renewable Energies to build the 4.5-GW park in the south of the country. If approved and carried out, the project would have the capacity to power more than 5m homes, or 7m electric vehicles across Europe once fully operational, making it one of the largest facilities of its kind worldwide.
In its submission TuNur outlined plans to export power from the park to Europe via underwater cables. The firm hopes to roll out the facility as a phased development in Rjim Maatoug, located within the governorate of Kebili, which receives double the amount of exposure to the sun as central Europe.
The first segment of the plant will cost €1.6bn to build and is planned to generate 250 MW of electricity, with early estimates suggesting it could be up and running as early as 2020. Electricity produced at the park will provide power to Malta, Italy and France, before being redistributed throughout the integrated European network. The project will require installation of an underwater cable linking the Tunisian network to Malta, which is already connected to Europe. Two other cables joining Tunisia to France and Italy are also under consideration.
Solar and wind projects to boost renewables share in energy mix
TuNur’s proposal, while targeting the European market, comes against a backdrop of initiatives taking shape in Tunisia aimed at boosting capacity to meet growing local demand.
The country remains largely dependent on hydrocarbons. However, many of the new ventures will harness renewable energy technologies as part of a national drive to boost their contribution to Tunisia’s energy mix.
In June the government announced plans to tender projects worth a total of TD400m (€137.7m) that will provide a combined 210 MW of capacity, split between solar power (70 MW) and wind farms (140 MW).
Output from these projects – which the ministry said would include both small-size and utility-scale production facilities – will then be bought by public utilities company Société Tunisienne de l’électricité et du gaz (STEG) under long-term power purchase agreements.
For solar initiatives, 10 MW of planned capacity will be distributed among projects of up to 1 MW, with the remaining 60 MW to be awarded for projects with a maximum capacity of 10 MW. For wind power, meanwhile, 20 MW of planned capacity will be allocated to smaller projects of up to 5 MW and 120 MW to larger projects of up to 30 MW each.
Bids for most projects are scheduled to close on November 15, although a tender for half of the wind-power capacity will be finalised in August 2018.
News of the bids follows a government decision in March to award a €12.5m contract to Italian renewable energy company Ternienergia to develop a 10-MW solar power facility. The overall cost of the plant, to be located in Tozeur in the country’s south, has been estimated at €16m .
Generating capacity of renewables reaches some 342 MW
The push for renewable energy is already leading to large capacity increases. According to the energy ministry, Tunisia’s total installed green power generating capacity had reached approximately 342 MW by the end of 2016.
The government allocated some $1bn (€830m) for renewable energy projects in 2017, with the aim of adding 1000 MW of generation capacity. A total of 650 MW will be sought from solar photovoltaic power projects and 350 MW from wind, while the private sector is expected to contribute an additional $600m over the course of the year.
Tunisia further expects to source 30% of domestic energy needs from renewables by 2030, compared to less than 6% today, according to government estimates. By that time it hopes to have 4.7 GW of installed capacity from renewables using both state and private funding, according to the sector development blueprint, the Tunisian Solar Plan.
The strategy aims to capitalise on the country’s favourable solar exposure, or irradiation, which ranges from 1800 KWh per sq metre per year in the north to 2600 KWh per sq metre per year in the south.
While the move towards renewables has met with widespread approval, industry players have also highlighted the need for more supporting infrastructure.
Saïd Mazigh, general manager, Carthage Power Company, told OBG that transporting and storing solar energy remained an issue, as panels used to generate power are not in constant use. “For Tunisia to capitalise on its sunshine resources,” he said, “it needs to invest in the necessary infrastructure to support solar energy projects.”
The National Office of Statistics (ONS) has this month announced unemployment that is worrying but predictable is on the increase. Moreover, despite all investment and employment agencies opting for a maximum of projects with financial and tax benefits, it should however be asked if these projects were fit for purpose as per a global vision of the country’s development. And, whether these are promising segments of sustainable growth or just some cosmetic operations for the redistribution of the rentier annuity to calm the social front? This contribution would want to look at Employment policy in 2017 – 2020 for Algeria and here it is as compiled from various write-ups of mine as leader of a multidisciplinary team of economists, sociologists and demographers between 2007 and 2008 on an audit (1) for the Algerian Government on employment and wages (eight volumes 980 pages).
Algeria according to international observers, as reiterated on November 2, 2016 in Algiers by an independent expert with the delegation of the European Parliament in Algiers chaired by Mr. Antonio Panzeri, Chairman of the Delegation for Relations with the Maghreb countries, has a full potential, subject to far-reaching reforms, to establish a diversified economy responsible for the creation of sustainable jobs and therefore the stability of the Mediterranean region and Africa
Structure of employment and unemployment between 2013 / 2017
The Algerian population has grown to 41.30 million on January 1st, 2017 and in April 2017, according to the ONS, the workforce reached a total of 12.27 million people with 2.52 million (20.60%) of women, against 12.12 million in September 2016, and a positive balance of 160,000 people, or an increase of 1.3%..
By the end of 2015, the active population was 11.93 million and unemployment for the same period, according to the ONS, was 11.2% with a 29.9% of youth unemployment.
According to the ONS, quoted by the Algerian Press Service (APS), the active population, was in April 2017 estimated at 10.769 million against 10.845 in September 2016, registering a negative balance of 76,000 people as compared to September 2016 where six out of ten people are on average long-term unemployed, which means 62.2% are looking for a job for 1 or over a year.
The unemployed population reached thereby 1.50 million, or 12.3% nationally, an increase of 1.8 point compared to September 2016. Youth unemployment rate for the 16-24 years was 29.7% and the distribution according to education, it was found that 787,000 unemployed had no degree , or more than half of all the unemployed population (52.2%). Thus, unemployment without qualification rose from 7.7% in September 2016 to 10.1% in April 2017, whereas that of graduates of vocational training increased from 13% to 14.8% between the same periods.
On the other hand, unemployment amongst university graduates declined slightly from 17.7% in September 2016 to 17.6% in April 2017. Still according to the ONS, the decline in the volume of employment between September 2016 and April 2017 has affected the sector of the construction industry with a negative balance of 91,000 people, and that of trade, services, and public administration a negative balance of 84,000 whereas, a positive balance was recorded for the sector of agriculture (63,000) and industry (36,000) compared with September 2016.
The preliminary report of the International monetary Fund (IMF) on the global economic outlook for Algeria shows that if in 2016, the growth of real GDP was 4.2%, the situation is expected to significantly deteriorate in 2017 and 2018. Indeed, the IMF expects growth of 1.4% of GDP in Algeria in 2017 and 2018; the Algerian economy should know stagnation, with a growth rate of GDP of only 0.6%. A direct result of the economic slowdown, the unemployment rate should substantially increase over the same period up to an estimated 13.2% in 2018 with an inflationary trend always according to the IMF that we are trying to compensate by creating jobs to very low value added.
An April 2016 investigation of the ONS confirmed that services sector were the trend of the economy with its correlation in employment. But these services sector are basically small trade and services representing 83% of the economic area with very low productivity and not comparable to those of the developed countries where the services sector notably through the information and communication technologies create opportunities for economic growth and generate productive employment.
Indeed, in April 2016, the structure of employment by sector of activity highlights market and non-market services to absorb 61.6% of the total work force, followed by construction (16.8%), industry (13%) and agriculture (8.7%). In a more precise way, on administration, according to the public service, the number of staff on January 1, 2015 is of 2,020,172 officials including 1,608,964 full time (79,64%) and 411,208 (20.30%) contractual agents.
State central administration is represented by 313,171 agents or 15.50% and 813,725 of decentralised national authorities officers or 41.57%, 312,009 local authorities administration agents or 15.4%, public administrative bodies 449,268 agents, or 22.24%, and all public scientific and technology 105,999 agents, or 5.25%. the young represent 274,074 agents, the 30 to 40 year old 735,756 agents, the 41/50 year old 668,725, the 50 to 59 years 92,580, and the more than 60 years only 20,944.
By sectors, the Interior represent 29,22%, education 29,34% with 592,831 of which 297,394 female agents, public health 13.19% with 138,581 out of a total 266,525 agents, higher education with women’s 8.50% of a workforce of 95,118 out of 171,761 total agents, finance with 4.15% vocational training with 2.80%, justice with 2.16% and other sectors 10.64%.
Investment between 2000 and 2017 allocation
Knowing that the industrial sector represents less than 5% of the gross domestic product (GDP), and on these 95% are SMIs/SMEs making up the Algerian productive fabric today going through difficulties because of bureaucratic, sclerotic financial system, socio-educational system not adapted, land disorganisation, in addition to competition from an informal sphere that controls 40 to 50% of the money in circulation. It must be asked if the young developers approved by programs such as the National Agency of Investment Development (ANDI), “Agence Nationale de Soutien a l’emploi des Jeunes” (ANSEJ) and other agencies responsible for the promotion of employment, have the qualification and above all the experience necessary to manager projects, like what is happening everywhere in the world, running a business in a competitive environment in order to have competitive prices.
Is there not a risk of wastage of oil revenues related financial resources and the use of Treasury towards the reorganization of public enterprises? As this is currently the case for El Hajar real financial chasms despite its public euphoric promises of the resolution of all problems between 2014 and 2015.
Because the current political industrial, without coherence is based on the material age (iron-cement) of the 1970s believing it to be the silver bullet.
Was it not a reasonable path meanwhile a real revival of non-hydrocarbon segments, to invest in the acquisition of knowledge by additional training and internships so as to prepare seriously for insertion in active life permanently?
How can we not forget that, according to official data in terms of the distribution of projects by sectors is transport that has attracted the most investment, closely followed by the building, public works, followed by far less than 15 to 20% of the industry and agriculture sectors with a low foreign direct investment FDI.
Large firms choose to settle in the neighbouring countries and trade with us mainly because of the 2009 Finance Act with its widespread share ownership rule of 49 / 51% is considered too protectionist by all foreign investors hence slowing the momentum of the IDEs towards the SMIs/SMEs. In General, the results of employment of the ANDI, the ANSEJ and the CNAC agencies with reference to projects and not in intention are mixed despite many benefits.
As according to some sources, more than 50% of the projects are abandoned after receiving benefits and the many disputes with banks about non refunds attest to this.
However, before any costly operation without analyzing its profitability in terms of dynamics in the light of the new technological changes and global managerial systems, a serene balance would mean to answer the following questions and this in a way specific and quantified:
What is the assessment of the ANDI, “Caisse Nationale d’Assurance Chomage” (CNAC) and the ANSEJ since their existence in the effective realisation of these projects and not those filed in and their legal status;
What is the time limit for projects carried out between the time of the deposit and the actual realization knowing that time management is of the essence;
For those realised projects how many got bankrupt according to the rules of the commercial code;
What is the share of hard currency vs. Dinars of these projects;
What is the level of bank debt of projects with the amount of bad debts;
What is the breakdown of bank credit per projects;
What is the exact amount of tax benefits for both the realised projects and those not carried out;
What is the breakdown of the jobs with the level of qualification per projects and those created insofar as the development of the 21st century is based on the development of knowledge;
What is the contribution to the country’s real added value of these projects;
Are these projects notably those realised up to international values insofar as with globalization, that despite the crisis, we have an open economy due to the fact to Algeria’s international commitments.
Also, to get an idea of the necessary balance and in order to go beyond the current entropy, it is necessary to assess the impact of public spending thus:
On the rate of growth, the unemployment rate and the purchasing power of citizens
Conducting surveys so as to highlight the distribution of income and consumption by strata model and determine the concentration index in real and not fictitious terms, and according to a dynamic medium and long term vision
The share of markets granted to national (public and private), distinguishing also self-financing and borrowing from banks and especially their production capacities,
Clearly distinguish within the investment part of hard currencies and part in Dinars;
The share of contracts awarded to foreigners;
Have these contributed to the accumulation of the organizational and technological know-how or was it turnkey contracts ;
What is their equity contribution and the share covered by Algerian banks;
What has been the amount of the flow of foreign direct investment and transfers of capital to Algeria;
What is the amount of currency outflow (goods – services often ignored of 10 to $12 billion dollars per year between 2010 and 2016) and legal capital transfers and finally analyze the impact of the implementation of the import licenses that must be part of a strategic goal of boosting without complacency the national productive fabric, being transitional and granted in total transparency to avoid pension situation and respecting international agreements.
For a new political job and wages policy
There is a universal law; the employment rate is a function of the rate of growth and of the structures of the productivity rates of competitive value-added enterprise. Jobs are not created through decrees or State voluntarism; the solution of ease is creating jobs in the administration.
The official unemployment rate of 12.3% for April 2017 is heavily biased including overstaffing in both Governments as in public companies, the fictitious temporary jobs and jobs in the informal sphere.
Paradoxically, because of the sectoral allocation of investment through public spending, strongly biased emphasis on jobs with very low qualifications such as the construction industry, graduates are more likely to be unemployed. This sector will create between 300,000 / 400 000 jobs a year between 2017 and 2020, which are in addition to the current unemployment rate underestimated due to demographic pressure, the entry on the labour market of women underestimated in the statistics, in order to solve the nagging problem of unemployment.
What will become of the 2 million students out of universities between 2018 and 2020? In general, foreign exchange reserves are only a monetary sign to stabilise the currency against the Dollar and the Euro and no sign of development.
Inflation and unemployment that we might artificially be compressing through the rentier revenues of hydrocarbons are the consequences of the disease of the social body, i.e. of the inconsistencies of the socio-economic policies. Without widespread subsidies, non-targeted, combined with the slippage of the Dinar, in the case of non-increasing production and real productivity, of the decline in foreign exchange reserves that sustain the Dinar value by up to 70%, the inflation rate could, in the coming years, reach double-digit with inevitable social tensions.
With the decline in receipts from hydrocarbons, this situation of widespread subsidies, tax benefits and subsidized interest granted in many areas without impact analysis, is untenable. Without the unproductive jobs and more in case the reduction of public expenditure, the growth rate being pulled to 70 and 80% directly and indirectly by public expenditure through hydrocarbons related revenues, including the construction industry, with the risk of a property bubble, with the decline in purchasing power, the unemployment rate beyond the official rate.
While not having a mainly negative view, there were lots of achievements, perhaps with many deficiencies but there is urgent need for a strategic vision to move beyond the current situation in this world in perpetual motion and a discourse of truth would be required. The fact is that Algeria still in 2017 in transition, is neither a State-controlled economy still very far from a true market economy that is characterised by a productive and competitive economy.
During this difficult period of transition from a State to a competitive market economy and the rule of law is that the reforms are timidly initiated despite speeches that contradict daily social practices, and always restrained especially as the price of oil increases. Banks or rather rentier pension distributers continue to operate as administrative shops, and often by doing so delay reforms issues through attacking the technical more than the organizational aspects, whilst they are the driving reforms; with privatization and partnership as a means of investment and value-added trampling due to lack of consistency and transparency; food bill is high despite the famous agricultural program (NADP) which should take stock of the fact of several billions of dollars in spending and bureaucracy and corruption continue to plague.
As consequence of the inconsistency and lack of visibility of the socio-economic policy and practice for many decades not only for the current period, the currency, we are witnessing the dizzying fall of the Dinar in the official market and on the parallel market with the return to inflation that is compressed by widespread unfair subsidies via the rentier pension whereas the targeting is necessary, in the speculative activities, the discouragement of knowledge and the enterprising creator of wealth, to the extension of the informal sphere, to social tensions through the various local governorates that reflected the difficulties of the economic system to generate growth away from hydrocarbon, only condition to deal with this social unrest.
Facing inevitable budget tensions between 2017 and 2020 and the price of oil being down for a long time, it will be as based on the results quantified and dated a matter to implement both economic and social strategies on adaptation and solidarity policy, assuming a broad national front, taking into account the different sensitivities of all local and international, the mutations at the dawn of the fourth world economic revolution with geostrategic upheaval (1).
A broad social front is necessary to accelerate all structural reforms. Algeria needs to avoid the lethargy and sterility that all of its children in their diversity join forces in a same economic and social development objective. Because, a multidimensional crisis in today’s Algerian society is fundamentally systemic, beyond the strictly economic scope, referring to political aspects involving renewed governance and therefore the reestablishment of the State would be the wisest. Moreover per all international observers, Algeria having all the required potential, it is only a matter of far-reaching reforms, that are aimed at establishing a diversified economy that will in the end be the guarantor of stability not only in the country but also in the Mediterranean region and the African continent. email@example.com
The Maghreb facing of new global issues: the weight of the informal sphere
In a July 28, 2017 interview by FRANCE24 TV, Paris of Dr Abderrahmane Mebtoul and in answer to whether the return to a State economy with the recent imposition of import licenses, the Algerian Government by introducing these import licenses for a number of goods and services to limit transfers of currency in this period of fiscal pressures has any meaning. Always concerned by the informal economy vs. economic development in Algeria, Dr A. Mebtoul’s answer was: To avoid misinterpretation, the program of the new Prime Minister is part of the guidance of his Excellency Mr. the President of the Republic. It is not guided by any administrative management style of the 1970s now in 2017 but merely a procedural strategy that cannot be assimilated to the old licenses of import of the 1970s and1980s. According to several official releases from the Algerian Government, taken over by the Agency Press Service, Algeria will comply with international trade rules that include quantitative restrictions when a country of balance of payment is facing some difficult conjecture.
Anyway, the strategic objective of the Government is to review the policy of subsidies and to integrate all capital into the real economy. Without an integration of the informal sphere which goes beyond the simple economic aspect and refers to all geo-strategic schemes from socio-economic mechanisms that assume another governance model without which, this policy may have a limited impact.
The informal economy, a sizable part of the country’s gross domestic product (GDP), has always been considered to be a major obstacle to the development of an all domestic production and economic diversification.
“Trade in the Tote’, which designates the commercial black market activities, is a very well-known expression of the Algerians. In the streets of the capital and elsewhere, vendors offer various products and whether presented on the shelves of stores or on the ground on public spaces, to local residents and passers-by, the black market products find always buyers.
Everything flows: shoes, clothes, food, perfumes and spare parts products, etc… “Informal activities are flooding the market, in the open and to the knowledge of all. Participants in the parallel economy do not think nor care about economic development but “only to make quick and easy gain,” says Lynda, Manager of a cosmetics business.
For economists, the informal market is part of those economic activities that are unregulated by socio-professional, tax and legal standards. It’s an underground economy that escapes the national accounts and the regulation of the State. “The barons of the informal sector are not incorporated into any logic of production. Their activities are untraceable and unfair. The informal economy encourages rapid enrichment,” says Hamid, a business leader.
Port Said Square in Algiers, is the main informal currency exchange central market where the Euro would buy nearly 190 Algerian Dinars (DZD) whereas per the Central Bank, it was at the end of 2016, between 115 and DZD117. The European single currency is of interests of course to all importers, businessmen or tourists, seeking in the currency black market”, says a salesman.
For its part, Mahjoub Bedda, president of the Finance Commission of the National Assembly believes that the informal market of currencies size is alarming. “It would be between 15 and 20% of the value of imports, corresponding to about $7 billion in 2016”, he said. The generalization of the cash and the absence of modern means of payment tend to amplify the persistence of the scourge. “This market gangrenes the country’s economy” said he emphtically.
Omnipresent in shops, services, building and construction and manufacturing activities, the informal economy represents according to official figures nearly 45% of the GDP, which corresponds to a value of some $125 billion. In the same context, the conclusions of the study conducted by the Office of National statistics (ONS) show that the informal economy employed 1.6 million people in 2001 as compared to 3.9 million in 2012.
These numbers consist of 45.6% of the total non-farm workforce, including 45.3% in trade and services, 37% in the building and public works sector and 17% in manufacturing.
Also, in December 2013, according to the above mentioned study for the Institute of International relations (IFRI), the informal sphere controlled more than $ 55 billion in 2012.
To enable the eradication of informal economic activities, the Government has implemented two key measures: the obligation of the use of cheques in commercial transactions for an amount greater than DZD1 million, from 2014, and permission to deposit money in banks without prosecution, subject to flat tax and that it comes not unlawful actions in 2015.
According to experts, there are two forms of informal activities: that of producing and that other of marketing. “There is a case of differentiating the informal productive sector, which creates value, from that of the speculative market sector, which is based on transfer of values”, says economist A. Mebtoul in a column published in the press.
To reorganize the market, Governments have implemented new features:
Dismantling of informal markets,
Strengthening of commercial infrastructure and
Easing of the requirements for trade registering.
“The period 2016-2020 will certainly be characterized by economic and social adjustments”, explained A. Mebtoul.
So, close to the ground, operations such as the following are being pursued.
This is to determine all relevant details of all informal markets and allow the public authorities to establish appropriate strategies of containment and / or elimination.
Restructuring of the markets
Launched by the authorities four years ago, all informal market sectors reincorporation / recuperation is still ongoing.
What are the most appropriate measures to reorganize and legalize the activities of the underground economy?
This calls for the lifting of the barriers to investment and the implementation of public policies with better economic prospects.
According to a study by the Organization for cooperation and development (OECD), tax can have an impact on growth generally. According to many experts, the fight against the informal market is not easy to implement. Globally, the fight against tax fraud is one of the priorities of Governments. To achieve this, the OECD countries have implemented a strategy that is to strengthen the legislative framework, to reorganize the administration and grow the collaboration and coordination of data exchange between State institutions. Thus, it is important to note that an effective fight against the informal economy, which represents a shortfall in important for the Treasury, the social security and the pension system, also requires the involvement of all stakeholders, including civil society.