Operating Environment Overview – Algerian Banking Institutions (Jun 2022)

Algeria's economy remains dominated by the state, a legacy of the country's socialist post-independence development model. In recent years the Algerian Government has halted the privatization of state-owned industries and imposed restrictions on imports and foreign involvement in its economy, pursuing an explicit import substitution policy. Hydrocarbons have long been the backbone of the economy, accounting for roughly 30% of GDP, 60% of budget revenues, and nearly 95% of export earnings. The COVID-19 crisis exacerbated the Algerian economy’s vulnerabilities, making the need for a new, more inclusive and sustainable, growth model that will also help diversify the economy away from hydrocarbons even more urgent.

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