Collapse of oil revenues and sharp increase in importations have caused a huge dent in Algeria’s foreign reserves with figures pointing at $58 billion loss since 2014; year of exceptional growth, the country’s Prime Minister said on Sunday.
Prime Minister Abdelmalek Sellal at a tripartite meeting including government, worker’s syndicate and employers, indicated that Algeria can no longer afford to rely on its mineral resources to boost economic growth.
Algeria’s economy has taken a downward direction since 2014 due to collapse of international crude oil price and the subsequent decrease in country’s oil revenues coupled with a significant increase of importations.
Foreign exchange reserves now stand at $137 billion against $195 billion in March 2014.
With its economy largely based on oil revenues Algeria knew a profitable foreign exchange reserve cushion when the oil revenues were in their heydays, with figures pointing at $77.8 billion in 2006, $ 110.2 billion in 2007, $162.2 billion in 2010, $190,6 billion end of 2012, and $194 end of 2013.
Aside from the drying of foreign exchange reserves, the North African country is also facing a cute depreciation of its national currency plunging the country further into economic, social and financial crisis.
In an attempt to address the situation, the Algerian President last month sacked the head of the country’s central bank, Mohamed Laksaci.
Algeria’s trade deficit at the first quarter of this year is estimated at $5.6 billion as compared to $3.4 billion at the same period last year.