Algeria’s PPP framework fails to modernise

27 August 2020
Despite early success in financing public utilities and other infrastructure through PPP, the country’s framework has failed to keep pace with investor expectations

Algeria has undertaken extensive regulatory and economic reforms to create a favourable climate for investment. This began in 2001 with its investment ordinance law and was followed up three years later with a supportive executive decree pertaining to the development of national infrastructure. 

Subsequently, the Algerian government proceeded to develop several PPP projects, with a focus on its energy and utilities sectors.

The government used PPP models to secure about $1.17bn in investment for its Medgaz pipeline in 2006 and brought in hundreds of millions of dollars at a time for desalination plants and renewable energy projects.

In 2009, $108m in investment was also secured in the transport sector for the Port of Algiers. 

The country’s PPP activity dropped off significantly after the 2009 global financial crisis, however, and no further projects worth more than $30m went ahead. 

Subsequent revisions to the legislative framework on investment seem to have failed to make Algeria more attractive to investors, despite its PPP experience.

The most recent legislative effort came in September 2015, with the addition of provisions for the delegation of public services to its Code of Public Procurement.

Subsequent revisions to the legislative framework on investment seem to have failed to make Algeria more attractive to investors, despite its PPP experience

Political uncertainty

The Algerian government still has a programme to build 28 large-scale desalination seawater stations, to attain a volume of 4 million cubic metres a day by 2020 and meet its growing demand for domestic and industrial use.

However, recent political uncertainty has complicated the administrative and investment picture and raised the prospect that the effectiveness of the PPP governance framework in Algeria could also be compromised.



 

> Algeria: PPP framework fails to modernise
> Bahrain: Manama ramps up its PPP plans
> Egypt: Mixed results for Egyptian PPPs
> Iraq: Crises and protests curb Iraq PPPs
> Jordan: Construction sector eyes PPP opportunities
> Kuwait: Corner turned on water and power schemes
> Lebanon: PPPs offer route to recovery
> Morocco: Rabat reforms legislation to spur PPPs
> Oman: Muscat risks PPP confidence loss
> Saudi Arabia: Riyadh refocuses PPP plans
> Tunisia: PPP plans draw broad support
> UAE: PPPs expected to take off in UAE
> Other GCC: Gulf state bolsters legislation to drive PPPs

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