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Algeria economic growth and energy security outlook

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2026-10-20 08:46 UTC → 2026-10-21 12:33 UTC · added ~~removed~~

The International Monetary Fund (IMF) has provided a positive assessment of Algeria’s economic performance following Article IV ~~consultations. The IMF noted~~ consultations, noting that ~~the country’s~~ reform ~~program has~~ programs have strengthened growth and reduced ~~reliance on hydrocarbons through successful economic diversification.~~ hydrocarbon reliance. Real GDP growth is projected to reach 3.8% in 2026, following 3.7% in 2024. The non-hydrocarbon sector is expected to show significant strength, having grown by 4.3% in 2025 and projected to exceed 4% in 2026. Regarding external debt, the IMF anticipates it will remain low, staying below 1% of GDP in 2026 and potentially dropping to 0.5% by 2031. While higher hydrocarbon prices are expected to boost exports and budget revenues, the IMF emphasized the need for continued structural reforms to promote private sector-led growth. Recent projections suggest Algeria’s nominal GDP could reach between $317 billion and $331 billion by 2026, with GDP at purchasing power parity (PPP) estimated at $947 billion. Kamel Moula, president of the Council for Economic Renewal (CREA), suggested during a national meeting in Algiers that the economy could achieve a growth rate of 4% through the mobilization of national companies. As of October 2026, Algeria is seeking greater flexibility from In the ~~IMF to navigate economic consequences stemming from regional conflicts. While geopolitical tensions have caused~~ energy price volatility, Algeria remains a reliable supplier because its hydrocarbon production and export infrastructure do not rely on maritime passages currently affected by war. In a strategic shift to increase domestic processing, sector, Minister of State for Hydrocarbons Mohamed Arkab has announced a target to raise the share of processed hydrocarbons from approximately 32% to over 50% by 2030. This is supported by a $71.6 billion investment program through 2030, including $13 billion for refining and the development of the Hassi Messaoud refinery and Arzew polypropylene plants. While export revenues reached $37.5 billion in the first nine months of 2026, LNG exports saw a 27% year-on-year drop in the third quarter of 2026, attributed to maintenance at the Arzew complex, reduced volumes to liquefaction facilities, and increased domestic electricity demand. Diversification efforts also extend to the pharmaceutical sector. In 2025, Algeria exported approximately $52 million in pharmaceutical products and medical devices to 33 countries. Industry Minister Ouacim Kouidri noted that the country hosts nearly 30% of Africa’s pharmaceutical factories and has adopted a national list of essential medicines to prioritize domestic production and international market optimization.

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