Economy, politics could trigger unrest in Algeria

Do you see the contrast between the West and the East? The question here is not about the United States and Russia, but about Algeria and Egypt. While the latter is working hard to recover from the Arab Spring and just inaugurated yesterday a second new branch of the Suez Canal, the former, though it hasn’t gone through the Arab Spring, is said to fueling growing concern within intelligence circles over the deterioration of its economic and political climate.

Algeria’s ageing leadership – President Abdelaziz Bouteflika is 78 years old – and the likely lack of public funds due to the dramatic fall in oil and gas prices for more than a year – which would account for 90% to 95% of the financing of the Algerian government’s social policies – could potentially be triggering political and social unrest in case Bouteflika’s political succession and/or further economic hardship were to take place unexpectedly and/or shortly.

The estimate by Reuters saying that “Algeria will trim spending in its 2015 budget by 1.35%” could be an understatement, sources said, and Algiers’ economic growth forecast set at 5.1% seems a bit too optimistic. If the downward trend in energy prices continues, Algeria’s overall situation could potentially become Europe’s next major issue.