November 22, 2022 | 4 days ago

IMF Report on Algeria: Exceptional revenue and remarkable resilience

In terms of achievements, the mission noted “progress made on fiscal reforms, notably in the areas of taxation and public expenditure management”.

Fouad Irnatene
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However, Ms Verdier recommends "closer integration between spending plans and the State funding strategy in the budget-making process, as well as diversification of funding sources to allow for a gradual implementation of fiscal rebalancing".

 

 

·        Transactions

o   In 2022, the current account of the balance of payments is projected to show its first surplus since 2013, and international reserves increased to $53.5 billion at the end of September from $46.7 billion at the end of 2021. A budgetary surplus is expected in 2022 due to higher revenues and lower than expected spending. GDP growth is projected at 2.9% in 2022.

·        Law on money

o   The forthcoming revision of the law on money and credit is an opportunity to strengthen the governance framework of the Banque d’Algérie and its independence. In this regard, the Mission welcomes the Government’s commitment not to use monetary financing. “The banking system has withstood the repeated shocks of recent years, but its financial health deserves attention.

·        Business climate

o   Continuing efforts to reform the business climate will help to drive the transition to a more inclusive and diversified growth model and stimulate job creation. The new Investment Law and related decrees could create a more favorable environment for private investment.

·        Renewable energies

o   The envisaged deployment of a new legislative framework for renewable energy investment could also facilitate the transition to a low-carbon economy.

·        Statistical Data

o   The mission welcomes the measures planned by the authorities to improve the quality and availability of statistical data and calls for priority to be given to actions in this area in order to better inform private sector policies and decisions.

 

 

(Extract from the IMF communiqué)

 

November 22, 2022 | algeria-logo