One of the more informative public guides to the North African country of Algeria is a 163-page manual directed toward prospective investors. Titled “Invest i
n Algeria,” and located at the Algerian Embassy to the United States website, this is the official version of Algeria, meant to lure business.
The cover of this booklet reveals the plums awaiting international harvest. It shows a photographic collage of flaming oil wells, a refinery, cargo ship, a private jet above a seaport, a field of green, a calm beachhead, the yellow machinery of agriculture and at its center, over-sized medicinal capsules.
This carefully wrapped balance of beauty and productivity is its best face. However, a close reading of the pamphlet reveals a government taxation system that creeps into nearly every transaction. What is absent from the content is far more troublesome to both investors and visitors. Accusations of government corruption are rampant, due in part to privatization of certain public companies, begun a decade ago to switch to a market economy. Huge swaths of infertile landscape support the country’s oil industry. However, oil revenues do not trickle down to local improvement or fund job development. Lastly, a government besieged by extreme Islamic terrorist groups has led to a 19-year state of emergency and a citizenry seemingly at the mercy of an aging president and a dominant military.
Terror and threat of terrorism in Algeria
One issue for investor, tourist and citizen of Algeria is the threat of terrorist activity. Through the years, several groups emerged as strains to the status quo. These include the Islamic Armed Group (GIA), the Islamic Salvation Front (FIS), an Islamist political party, its armed counterpart, the Islamic Army of Salvation (AIS), and the more moderate Salafist Group for Preaching and Combat (GSPC).
The watchdog group, Algeria-Watch has concluded that only the GSPC remains a viable threat. GSPC has publicly endorsed al-Qaida and set as its goal the removal of the government of Algeria. GSPC was started in the aftermath of a bloody civil war between the government and the armed FIS that began in 1992. When the Algerian army canceled elections in which the FIS had obtained a majority, the two forces engaged in a violent struggle for power. Several hundred thousand people were killed during this conflict, many are still unaccounted for and 70 journalists were assassinated. The Islamic Army of Salvation disbanded in 1997, effectively ending the civil war.
“Security… no longer an obstacle”
However, the potential Algerian investor is assured that, “President [Abdelaziz] Bouteflika is fighting against terrorism that has infiltrated into Algeria since 1994. His action has considerably helped to create a saler [sic] environment.” Furthermore, the pamphlet offers what sounds like a guarantee of safety, concluding that, “The big cities of the country have not suffered from recent major attacks. In fact, security considerations are no longer an obstacle for business trips in Algeria.” (Ministry Delegate for Participation and Investment Promotion n.d.)
But the government’s credibility remains questionable. In 1994, it forbid its media any mention of terrorist activity, the UK news group Reuters left the country, airports were closed to foreign traffic and the Moroccan border was sealed.
Beginning in the summer of 1997, after six years of civil war, the country was rocked by the savage massacre of entire villages. The Islamic Armed Group (GIA), claimed responsibility, and its leader declared that all Algerians who did not actively fight the government could be killed with impunity. Based on the doctrine of takfir, these Muslims were viewed as apostates or unbelievers, and subject to death according to Sunni Islamic law. (Isseroff 2008) The belief in takfir is shared by associates of Osama bin Laden but disavowed by moderate Islamists.
The butchery in Algeria ignited world attention. In October 1997, Le Monde described the attacks and its effects:
"Since July this year, Algeria, or to be more precise the centre of the country around and to the south of the capital, has been swept by a wave of exceptionally savage night-time attacks with knives and machetes attributed to unidentified Islamist groups. The slaughter and throat-cutting continue in an atmosphere of unbridled barbarity. Faced with the impotence and astonishing inaction of the authorities, terrified people are fleeing from isolated villages and settlements. And fear is spreading in the outlying districts of Algiers, where self-defence groups are hastily being formed amid scenes of rising panic, chaos and desperation." (Salies 1997)
Because of the continuing bloodshed, the government approved of the formation of small militia and local defense groups, which both attack and defend against extremist Islamic forces. These paramilitary groups are trained, funded and armed by the Algerian army. They act as protectors in local areas, freeing the Algerian army for larger battles. Consequently, the country is heavily armed with both conventional weaponry and primitive weapons such as machetes and hunting knives. In 1997, the combined numbers of these paramilitary forces was estimated at 200,000, outnumbering the Algerian army. The country is literally, armed to the teeth with nearly half a million official and paramilitary forces.
Nonetheless, Algeria’s status as a safe place for both foreigners and its own inhabitants remains unsound.
As recently as February 2011, the U.S. Department of State included North Africa on its “Worldwide Caution" list. While not naming Algeria specifically, the international travel advisory issued a strong warning, saying that: “Credible information indicates terrorist groups also seek to continue attacks against U.S. interests in the Middle East and North Africa.” (U.S. Department of State 2011) This is in stark contrast to Bouteflika’s assurances of safety.
Algeria’s oil and gas market
Despite this volatile situation, Algeria continues to lure foreign investors and contractors to its oil-glutted Eastern Sahara. The country is an important member of OPEC, and maintains a world presence as the sixth largest producer of natural gas and the fourth largest crude oil producer in Africa. It contains the third largest oil reserves in Africa.
The state-owned Sonatrach company controls the majority of the oil and natural gas production in the country. By law, Sonatrach receives a 51% share in every oil and gas exploration contract awarded to foreign companies. (U.S. Energy Information Administration 2011) Algeria exports seventy percent of its production and allocates the remainder for domestic use. The top five importers of Algerian natural gas in order of volume are Italy, Spain, France, Turkey and the United States.
Algeria’s ignored domestic scene
After 9/11, Algeria vowed to combat al-Qaida terrorism, offering assurances to the U.S. Yet, according to Algeria-Watch, the country’s focus on international safeguards has resulted in a lessening of attention on its domestic problems.
In 2003, Algeria-Watch highlighted the fate of Algeria’s youth, struggling with dejection and disempowerment from unemployment and the sense of a bleak future. Facing such a situation, many of these young people are leaving Algeria for nearby European countries. Their pessimism casts them in the direction of al-Qaida with its vision of global domination.
Algeria-Watch concluded that any consideration of the forces of terrorism must center on the hopefulness offered by al-Qaeda contrasted with the futility young Algerians feel in their home country. “This suggests that for those engaged in the fight against terrorism, more attention needs to be paid not only to the recruitment and radicalisation of these individuals within Europe and North America, but also on the wider causes for their alienation within Algeria itself.” (Algeria-Watch 2003)
Algeria in revolt
On 12 February 2011, a wave of youth demonstrations shook Algiers, lit by the democratic revolution in Egypt. The cadre of youth faced an extraordinary show of police, and by some estimates, the demonstrators were outnumbered three-to-one.
Coordinated by a newly-formed coalition group calling itself the National Co-ordination for Change and Democracy (CNCD), the protest is a clear indicator of democratic aspirations among the youth. The heavy-handed government reaction is likewise a clear indication of its obstruction to such aims.
According to The Telegraph, internet connectivity was disrupted, Facebook accounts of march supporters deleted, connecting roads closed, journalists removed and unconfirmed numbers of people were arrested before and during the demonstrations.
President Bouteflika had previously issued a statement declaring that the longstanding state of emergency would be lifted “soon.” Yet as of the date of this article, it remains in effect.
The CNCD’s planned demonstration along with ongoing terrorist activity caused the British Foreign Office to caution against travel in Algeria. It reported at least one kidnapping and extended this warning to international travelers: “There is a high threat from terrorism in Algeria. You should exercise extreme caution at all times as terrorist attacks could take place in areas frequented by expatriates and foreign travellers such as restaurants, hotels and shopping centres.” (Foreign & Commonwealth Office 2011)
An April 2010 Travel Warning specific to Algeria remained in effect at the U.S. State Department’s Bureau of Consular Affairs. Noting that “Terrorist attacks, including bombings, false roadblocks, kidnappings, ambushes, and assassinations occur regularly,” US citizens are urged to “avoid overland travel” and “large crowds” and stay in hotels with security. In addition, US Embassy officials work and live under tightened security. All travel outside the boundaries of Algiers requires a security escort provided by the government of Algeria.
What fate awaits Algeria?
Algeria’s oil wealth is a boon to the country and a magnet for foreign investment. This considerable asset is counter-balanced with a domestic environment in the throes of upheaval. The change may come in the shape of a transformed government ala Egypt. Guerilla warfare by extremists may surge or the nation may engage in a slow push for reform. Oil beckons as a mighty temptation. But without a stable homeland, the price may be far too high.
Sources:
Algeria-Watch. Information on the Human Rights Situation in Algeria. 2003. http://www.algeria-watch.org/en/analyses/algeria_terrorism.htm (accessed February 13, 2011).
Central Intelligence Agency. Algeria. January 20, 2011. https://www.cia.gov/library/publications/the-world-factbook/geos/ag.html (accessed February 12, 2011).
Foreign & Commonwealth Office. "Middle East and North Africa - Algeria ." Travel and living abroad. February 14, 2011. http://www.fco.gov.uk/en/travel-and-living-abroad/travel-advice-by-country/middle-east-north-africa/algeria (accessed February 13, 2011).
Isseroff, Ami. Takfir. June 2008. http://www.mideastweb.org/Middle-East-Encyclopedia/takfir.htm (accessed February 12, 2011).
Ministry Delegate for Participation and Investment Promotion. "Investing in Algeria." http://www.algeria-us.org/forms/Invest_in_Algeria.pdf (accessed February 13, 2011).
Ramdani, Nabila. "Algeria shuts down internet and Facebook as protest mounts ." The Telegraph. February 12, 2011. http://www.telegraph.co.uk/news/worldnews/africaandindianocean/algeria/8320772/Algeria-shuts-down-internet-and-Facebook-as-protest-mounts.html (accessed February 14, 2011).
Salies, Bruno Callies de. "Algeria in the grip of terror." October 1997. http://mondediplo.com/1997/10/alger1 (accessed February 13, 2011).
U.S. Department of State. "Travel Warning: Algeria." Bureau of Consular Affairs. April 2, 2010. http://travel.state.gov/travel/cis_pa_tw/tw/tw_929.html (accessed February 14, 2011).
U.S. Department of State. "Worldwide Caution." International Travel. Febrary 14, 2011. http://www.travel.state.gov/travel/cis_pa_tw/pa/pa_4787.html (accessed February 14, 2011).
U.S. Energy Information Administration. "Algeria: Background ." Independent Statistics & Analysis. http://www.eia.gov/countries/cab.cfm?fips=AG (accessed February 14, 2011).
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