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October 30, 2025 | 7 hours ago

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Investment financing: New incentives on the horizon

Algeria is continuing its efforts to boost productive and wealth-creating investment. Having virtually eliminated all the bureaucratic barriers and obstacles that previously impeded investment and business, thanks to the establishment of a flexible and attractive regulatory framework, the government is now focusing on another area that is just as essential for economic operators and investors, i.e. financing.

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The Algerian government, under the leadership of Prime Minister Sifi Ghrieb, has examined a draft decree aimed at improving interest rates and profit margins on bank loans to support investment projects. This text aims to ensure fairness between financing instruments by integrating Islamic finance into the public support system.

A specific regime is planned for strategic projects to stimulate their financing and promote their impact on growth. This reform aims to modernize the financing framework, strengthen the role of banks, and create a more inclusive financial environment.

Despite some progress, access to credit remains limited (13% of businesses and households), revealing a gap between the financial and productive spheres. The president is calling for the banking sector to be revitalized, particularly through a private network that supplements public banks.

Bank loans reached 11,256.5 billion dinars by the end of 2024, a 5.3% increase. The private sector benefited from 6,688.9 billion dinars (+7.3%). Private sector involvement is crucial to achieving national objectives: a GDP of $400 billion by 2027, 450,000 jobs, and 20,000 projects.

Lastly, the project is designed to mobilize informal funds, reinforce banking resilience, and support the national development plan's priorities, especially resource development, import substitution, and the establishment of local value chains.

October 30, 2025 | algeria-logo

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