2024-11-18 15:45:00
ALGIERS – The World Bank (WB) highlighted, in its latest monitoring report on the economic situation of Algeria for the fall of 2024, published Monday on its website, the solid economic performance of the country, ensuring that the Growth in the first half of the current year was “robust”, reaching 3.9%.
This growth is “diversified and supported by a resilient agricultural sector”, underlined the WB in its document, specifying that Algeria has experienced a “notable improvement in price stability, with inflation reduced to 4.3% over the first nine months of 2024.
During the first half of 2024, Algeria’s economic growth remained “robust, supported by non-extractive sectors and by investment”, noted the report, adding “that after an acceleration to 4.1% in 2023, GDP growth slowed slightly in the first half of 2024 (+3.9% year-on-year), supported by dynamic non-extractive growth.
In this context, the WB indicated that investment growth accelerated, boosting imports, while private and public consumption remained robust.
On the other hand, extractive GDP also remained stable during the first half (+1%) after a further reduction in Algeria’s crude oil production quota in January and a drop in European gas demand, mentioned the institution in its report.
While noting a stabilization of the prices of fresh products, the moderation of import costs and a stable exchange rate during this period, the international financial institution also specified that foreign exchange reserves remain “comfortable”, representing the equivalent of 16.2 months of imports of goods and services in September 2024.
The other positive indicator highlighted in the report is that of the decline in inflation which “slowed significantly in 2024, thanks to resilient agricultural production, the stabilization of fresh food prices, the moderation of import prices and stability of the exchange rate,” said the WB.
According to World Bank forecasts, growth is expected to rebound in 2025, with a recovery in the hydrocarbon sector supporting a “rebound in growth”.
In its economic report, the World Bank also highlighted the “considerable potential” for the growth of Algeria’s non-hydrocarbon exports.
“Diversifying products and export markets while increasing value addition will be key to achieving the government’s target of $29 billion in non-hydrocarbon exports by 2030,” she noted.
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How does the recent reduction in inflation impact Algeria’s overall economic stability and growth potential?
**Interview with Dr. Layla Benali, Economist at the World Bank**
**Editor:** Thank you for joining us today, Dr. Benali. The World Bank has recently published an encouraging report on Algeria’s economic situation. Can you summarize the key findings of your report?
**Dr. Benali:** Thank you for having me. Our latest report highlights Algeria’s robust economic growth in the first half of 2024, which reached an impressive 3.9%. This growth is quite diversified and primarily driven by a resilient agricultural sector, which is encouraging given the country’s recent focus on diversifying its economy.
**Editor:** That’s an impressive figure. You also mentioned improvements in inflation. Can you elaborate on that?
**Dr. Benali:** Certainly. We observed a notable improvement in price stability, with inflation reduced to 4.3% over the first nine months of 2024. This is significant as controlling inflation is crucial for maintaining economic confidence and ensuring that growth is sustainable in the long term.
**Editor:** The report indicates that growth was supported by non-extractive sectors and investment. Can you explain what this means for Algeria’s economic future?
**Dr. Benali:** Yes, the shift towards non-extractive sectors, such as agriculture and services, combined with increased investment, reflects Algeria’s commitment to moving away from a heavy reliance on oil and gas. This diversification is vital for building a more resilient economy, reducing vulnerabilities to external shocks, and creating jobs in various sectors.
**Editor:** What challenges does Algeria still face, despite these positive indicators?
**Dr. Benali:** While there are many positive developments, challenges remain. Structural reforms are crucial to fully unleash the potential of the economy. Issues such as improving the business environment, addressing unemployment, and ensuring robust governance frameworks need ongoing attention to sustain and enhance growth.
**Editor:** Thank you, Dr. Benali, for your insights. It seems Algeria is on a promising path, but with careful attention to these challenges, the country can continue to thrive.
**Dr. Benali:** Thank you for having me. It’s indeed an exciting time for Algeria’s economy, and with continued effort and reform, the future looks bright.
