Algeria's Exchange Reserves To Run Out Within 30 Months
Economists warn of the rapid erosion of Algeria's exchange reserves, which they linked with the interestingly increase of the import bill, and the decreasing volume of exports outside hydrocarbons.
"Over $ 8 billion run out from the reserve fund within 90 days, which is a dangerous indicator. Government should apply what it already talked about, through increasing imports in 2017 at the limits of $ 30 billion. People should at the same time understand the need to neglect the luxuries from their accounts next year, otherwise the authorities will fail to maintain the $ 100 billion reserve by 2019, as it was previously promised by Prime Minister, Abdelmalek Sellal".
In this context, the economist Kamal Rezzig said that talking about the exchange reserves in Algeria is offset by talking about imports, which exceeded all the limits and red lines.
"Over 121.8 billion dollars is not a huge wealth as imagined by the Algerians, especially compared with some countries' reserves which are equivalent to hundreds of billions of dollars. The only solution for the next stage is to raise the rate of non-hydrocarbon exports, and impose more restrictions on imports and luxuries, otherwise the reserve will run out during 30 months at the latest".
"I wonder about the secret of keeping the top roof on exports outside hydrocarbons at two billion dollars since years ago, despite the widespread drumming policy that was pursued by the government. It is time to suppress the unnecessary imports, and retained only the basics of food, medicines and raw materials for industry, to save the balance of trade, which is now threatened to explode in the next stage. It is illogical to drain $ 8 billion in a few weeks. The solution depends on the encouragement of the local product, and reviewing the policy of stimulus, because whenever there is a lack of stimulation the production reduces. We should reconsider the percentage of integration and the elimination of the basis 51-49, and compel producers to export between 20 and 30% of their product. Some businessmen in Algeria are still dealing with a childish logic, and do not deal with the situation logically and with patriotism".
For his part, head of the Algerian Exporters Association, Ali Bay Nasseri, confirmed that raising the proportion of exports out of hydrocarbons depends on the facilities that can be provided by the government for Algerian dealers, especially with regard to banking procedures, which are not yet released.
"Decline in the proportion of exports, which is the first pump of hard currency, is due to the erosion of oil revenues and its derivatives. First resource for the treasury out of hydrocarbons is phosphate and oil derivatives, which makes the numbers offensive every time".