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Organized by our Chamber with the co-operation of the Embassy of
Algeria,
Friday November 5, 2010 at the World Trade
Center Zurich, 8.30 am
3.00 pm,
ALGERIA Investment plan 2010-2014
Algeria
is looking to step up its campaign to strengthen the country’s
transport infrastructure, unveiling a multibillion-euro programme of
investments aimed at broadening the base of the economy and reducing
dependency on hydrocarbons. On May 24,2010 the Algerian cabinet,
during a meeting chaired by President Abdelaziz Bouteflika, approved
a five-year, US$ 286bn investment plan. Some US$ 130bn of this will
be used to complete projects already under way, while US$ 156bn
would be used to finance new schemes in the sectors of education,
housing, infrastructure, health, transport, etc.. A statement issued
after the cabinet meeting said that the investment programme, set to
run from 2010 to 2014, was to be the driving force behind government
efforts to diversify the economy.
Central
to the new programme –and to the longer-term development of the
economy as a whole– is a continuing upgrade of existing transport
infrastructure alongside a raft of new transport projects. A total
of US 37.8bn has been allocated to the various segments of the
transport sector. The lion’s share will go to the rail sector, which
the government considers vital to broadening the base of the
Algerian economy and linking its various industrial production hubs
with the expanding land and sea transport centres. Under the
development programme, 6500 km of new track will be laid and a
further 500 km of the existing network will be upgraded. Urban
transport will also receive a major boost with the construction of
light rail or tram systems in 14 cities. Though the list of projects
and investments is impressive, some of the funding has been rolled
over from previous development programmes. Not all of the projects
are new and a number have been carried over from the prior fiveyear
plan, which concluded in 2009. Even before the new investment
programme was unveiled, the Transport Ministry awarded a joint
contract to Spanish firm Fomento de Construcciones y Contratas (FCC)
and Algerian firm ETRHB Haddad for the construction of a 185-km-long
railway line linking Algiers to Relizane, Tiaret and Tissemsilt in
the northwest.
The work,
which has a price tag of €1bn, involves the construction of a
single, high-performance track that allows for a maximum speed of
160 km/hr. The FCC contract is just the most recent in a series of
tenders awarded in recent months, with Canadian engineering firm
Dessau winning a €30.6m bid to design an electrified rail project
that will connect Algiers to Constantine in north-eastern Algeria.
The project involves the preliminary and final design for the
construction of a 170-km-long double track to be used by both
passenger and freight trains. The Dessau contract is just a small
part of a €1.8bn project to be carried out through the cooperation
of China Civil Engineering Construction Corporation and Ozgun
Construction, Turkey. President Bouteflika said the government would
assess the country’s financial situation at the end of each year in
order to determine the viability of the scheduled projects. He
emphasised that Algeria would not borrow overseas funds to complete
the programme. With energy prices creeping higher and predictions
for solid economic expansion on the horizon, Algeria should not be
hard-pressed to find funds for its transport investment programme.
In late April, the IMF revised its forecast for Algeria’s economy,
raising its estimates for GDP growth from 3.9% for both this year
and 2011 to 4.6% and 4.1%, respectively. The IMF also predicted
Algeria would enjoy trade surpluses of 2.5% of GDP in 2010 and 3.4%
of GDP in 2011. A strengthened transport backbone is essential as
Algeria seeks to promote increased investment in its economy and
bolster its agriculture, manufacturing and tourism sectors. By
prioritising existing projects and fast-tracking new rail schemes,
Algeria is well positioned to experience strong economic growth in
the coming decade .
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