With many international contractors prioritizing other Middle East markets over Algeria, state-backed Chinese contractors are cornering the construction market. China state Construction & engineering Company (CSCEC), which is carrying out the bulk of the government's housing programme, is the most prominent of about 20 Chinese companies working in the sector.

A team from China International Trust & Investment Corporation and China Railway Construction Corporation have won two of the three contracts for the East-West motorway.

In the oil and gas sector, China National Petroleum Corporation is building a condensate topping refinery at Skikda in the northeast and carrying out a programme to develop a 13,000-barrel-a-day refinery at Adrar in the south.

According to Employment Ministry figures, the Chinese account for 45 per cent of the foreign workers in the country, with their numbers rising to 18,000 in 2006 from just 543 in 1999.

One key benefit of using Chinese contractors is they bring their own low-cost workforces, mitigating rising construction costs driven by an overheated contracting market. However, critics claim this benefit is a double-edged sword. It leaves thousands of Chinese workers living in less than salubrious conditions, and excludes Algerians from construction jobs, which could have helped the country tackle its rising unemployment problem. Algeria's jobless rate is estimated at 20-30 per cent, with youth unemployment of up to 40 per cent in the major cities.

Lowering standards

The move by Chinese contractors to dominate the sector has also brought criticism from other players in the market who claim they lack the relevant expertise to carry out work to international standards. 'They are being recruited on the basis of price alone,' says a senior source at one European services company. 'Algiers will soon find that the quality is not the same.'

Other market players claim projects carried out by the Chinese have been blighted by delays. The scheduled opening of the Houari Boumediene airport in Algiers, built by CSCEC, was delayed by a year, and there have also been delays at the company's housing construction projects.

But in reality most of the delays have been beyond the control of the contractors. Legal disputes over land ownership and the Housing Ministry's failure to put in place effective financing have severely hampered their ability to complete work to schedule.

In the civil construction industry, there are few qualms about the quality of the work the Chinese are doing. 'As long as there is sufficient supervision from the project consultant, there is no question that the Chinese can do the work,' says Ezzat Aoun, resident manager at Lebanon's Khatib & Alami. 'It just makes it difficult when there is so little competition for contracts.'