Algeria Economic Outlook
June 7, 2022GDP remained below its pre-pandemic level at the end of 2021. In H1 2022, hydrocarbons, which account for 95% of the country’s exports, are driving the recovery. OPEC+ continues to raise oil production quotas, and EU demand for Algerian gas is rising as it seeks to reduce its dependence on Russian energy. Oil output was up 12.6% year-on-year in Q1, with gas exports to Europe rising by over 9% yoy in the same quarter. Near decade-high energy prices are fortifying the external and fiscal balances and spurring new hydrocarbon investment, boding well for future output. However, hydrocarbons output growth will be limited by weak prior investment and the closure of a pipeline last year. In the non-hydrocarbons sector, activity is more subdued. The war in Ukraine has caused food prices to soar, likely hitting private spending, despite recent VAT cuts and the introduction of a new unemployment benefit.
Algeria Economic GrowthThis year, growth will be supported by larger OPEC+ quotas, increased European demand and higher investment in the hydrocarbons sector. However, the GDP expansion is likely to be among the lowest in MENA, as a poor business environment and high levels of corruption curtail activity. FocusEconomics panelists foresee the economy growing 3.1% in 2022, which is unchanged from last month’s forecast, and 2.4% in 2023.
Algeria Economy Data
5 years of Algeria economic forecasts for more than 30 economic indicators.
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