The African Development Bank said the Algerian economy is the third worst hit in Africa at a time the country faces a multipronged political, economic and social crisis worsened by lack of political reforms. The bank said the contraction of the Algerian GDP by at least 6.4% this year was due to its heavy dependence on oil and gas. The IMF expects the fiscal deficit to hit 20% as a result of the uncontrolled subsidies policy, key to the country’s social peace. Algerian finances were dealt a blow by sluggish demand coupled with historically low oil prices and lack of reforms to diversify the economy. Algeria’s reserves shrunk from nearly $200bn in 2014 to near $62bn just before the coronavirus outbreak with the real prospect they could run out within two years.

Source: The North Africa Journal July 13, 2020 15:45 UTC