Algeria faces an era of economic and political stagnation as it embarks on fiscal consolidation under an ageing leader.
Economic risk (MEDIUM): The economy is forecast to enter a period of substantially lower growth as the government embarks on a plan to cut spending to reduce the deficit.
Political risk (HIGH): The ruling party of President Abdelaziz Bouteflika retained power at local elections. But the president’s age and ill health have raised concerns over the succession process.
Financial risk (LOW): With its closed financial system Algeria is largely immune to global volatility. Falling oil prices increased risks of financial instability but a rebound may ease pressure.
Commercial risk (MEDIUM): A new investment law offering tax breaks to investors should helped raise Algeria’s poor ranking in the World Bank’s Doing Business Report in 2017 and boost lending.