Algiers – Algerian Prime Minister Abdelmalek Sellal is expected to announce a new package of reforms to cope with plummeting global energy prices within the coming weeks.
Last December, Sellal established a task force to diversify the country’s oil-dependent economy.
While the Algerian government did not respond to Al Jazeera’s questions on the matter, one source who spoke on condition of anonymity said Sellal would be hosting a meeting in mid-May, after which the reforms would be announced.
“There are ongoing tensions within the government between those who say that Algeria needs to pass urgent reforms only, and those who want overall reform as well to develop both non-hydrocarbon and private sectors,” the source told Al Jazeera.
Analysts say the new austerity measures are likely to be announced in an effort to control public-sector debt. Hassan Haddouche, a journalist specialising in economic issues, told Al Jazeera that the task force’s plan would “feature further spending cuts, as the crash in energy prices is putting Algeria under financial pressure”.
Algeria, Africa’s largest country and a major energy exporter, is in the throes of a budget crisis amid the global slump in oil prices. Energy sales account for 95 percent of Algeria’s exports and provide 60 percent of the state budget. But in 2015, Algeria saw its export revenues halved, owing to both falling oil prices and the depreciation of the dinar. As a consequence, the fiscal deficit, which has been growing since 2014, nearly doubled to 16 percent of gross domestic product in 2015, according to the Finance Ministry.