Algèria: Invertir a Algèria
Rich in natural resources and economically stable, Algeria has historically attracted decent FDI flows. However, FDI flows were negatively impacted by the social unrest followed by the COVID-19 pandemic these last years. According to the data published by UNCTAD in the World Investment Report 2021, FDI in Algeria decreased by 19% to USD 1.1 billion in 2020 (down from USD 1.3 billion in 2019) with inflows directed primarily to the natural resources sector, in the wake of the global health and economic crisis triggered by the Covid-19 pandemic. On the other hand, the stock of FDI increased, reaching USD 33 billion in 2020.Over the last few years, it can be seen a reorientation of FDI towards the domestic market, thanks to the proliferation of development projects in transportation and infrastructure. China and Turkey have been investing heavily in Algeria, taking over France's historical position as the largest investor in the country. European investments have recently decreased in favour of a greater interest from Gulf investors. One of the biggest investors is BAIC International (China), with an investment of more than USD 100 million in a manufacturing plant. Other major investors include Hyundai and Ford. On a country level, China, Singapore, Spain and Turkey are the leading investors; whereas industry, tourism, construction and agriculture are the sectors who receive most FDIs.
Protectionist measures, as well as corruption, bureaucracy, a weak financial sector and legal insecurity in terms of intellectual property rights are serious obstacles to investment.Until 2019, the participation of a foreign investor in an Algerian company was limited to 49% and foreign contractors are forced to find local partners for public tenders. However, in 2020, the government of President Abdelmadjid Tebboune eliminated the so-called "51/49" restriction that required Algerian majority ownership of all new companies. The requirement will be maintained for "strategic sectors", identified as hydrocarbons, mining, defence and pharmaceutical production. The government has also approved a new hydrocarbons law, improving fiscal conditions and contract flexibility in order to attract new international investors. As a result of the promulgation of this law, major international oil companies signed memoranda of understanding with the national hydrocarbon company Sonatrach. Algeria was ranked 157th out of 190 countries in the Doing Business 2020 report published by the World Bank, same place as the year before.
Foreign Direct Investment | 2019 | 2020 | 2021 |
FDI Inward Flow (million USD) | 1,382 | 1,143 | 870 |
FDI Stock (million USD) | 31,965 | 33,107 | 33,977 |
Number of Greenfield Investments* | 24 | 6 | 10 |
Value of Greenfield Investments (million USD) | 2,316 | 77 | 858 |
Source: UNCTAD, Latest available data
Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.
Country Comparison For the Protection of Investors | Algeria | Middle East & North Africa | United States | Germany |
Index of Transaction Transparency* | 4.0 | 6.4 | 7.0 | 5.0 |
Index of Manager’s Responsibility** | 1.0 | 4.8 | 9.0 | 5.0 |
Index of Shareholders’ Power*** | 5.0 | 4.7 | 9.0 | 5.0 |
Source: Doing Business, Latest available data
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.
Algeria's strong points for FDI include:
Algeria's weak points for FDI include:
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Actualitzacions: January 2023