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In this page: FDI in Figures | Why You Should Choose to Invest in Algeria | Procedures Relative to Foreign Investment | Investment Opportunities


FDI in Figures

In regards to FDI, it can clearly be noticed a sharp decline of European investments and a revival of interest from the Gulf investors. A re-orientation of FDI towards the domestic market is also noticeable through an efflorescence of developmental projects in transportation and infrastructure. Rich in natural resources and economically stable, Algeria has attracted growing levels of FDI in the recent years, even if their stock remained weak. In 2012, the FDI stock dropped, according to some, it was the result of the introduction of a 49/51 rule, which limits the participation of a foreign investor in local companies to 49%. In addition to this, foreign bidders for public contracts are now required to find local partners. After a sharp reduction in 2012, new FDI inflows increased again during the first semester of 2013, surpassing EUR 2 billion. The total for the entire year should reach EUR 3 billion. The authorities are trying to improve the investment climate in 2014 and to develop partnerships among public companies and foreign entities. Despite a substantial potential, the business climate still needs to make progress. Algeria ranks 153 out of 189 countries in the classification Doing Business 2014 issued by the World Bank. Investors could also become more cautious after the hostage-taking incident at the gas site of In Amenas which ended up tragically (40 dead victims) in January 2013. Following this drama, the oil companies Statoil and BP withdrew their personnel. The site should restart its operations in the first months of 2014. Lastly, an oil field of about 1.3 billion barrels was discovered in December 2013, this discovery should attract new investors. 

A series of protectionist measures taken by the Algerian government, as well as corruption, heavy bureaucracy, a weak financial sector and the legal insecurity in terms of intellectual property rights are hindrances to investment. Officially, the government remains committed to its economic liberalization and continues to seek foreign investment in sectors such as infrastructures, telecommunications, energy and water supply. Currently, the sectors attracting most FDI are the energy sector, followed by the telecommunications and tourism sectors.


Country Comparison For the Protection of Investors

  Algeria Middle East & North Africa United States Germany
Index of Transaction Transparency* 6.0 6.0 7.0 5.0
Index of Manager’s Responsibility** 6.0 5.0 9.0 5.0
Index of Shareholders’ Power*** 4.0 9.0 5.0
Index of Investor Protection**** 5.3 5.0 8.3 5.0

Source: Doing Business - Last Available Data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.

Foreign Direct Investment 201120122013
FDI Inward Flow (million USD) 2,5811,4991,691
FDI Stock (million USD) 22,10823,60725,298
Performance Index*, Ranking on 181 Economies 103--
Potential Index**, Ranking on 177 Economies 62--
Number of Greenfield Investments*** 271716
FDI Inwards (in % of GFCF****)
FDI Stock (in % of GDP) 11.111.412.3

Source: UNCTAD - Last Available Data.

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

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Why You Should Choose to Invest in Algeria

Strong Points
- The low cost of energy constituents (gas, fuel and electricity): industrial gas is 22 times cheaper than the European average, electricity is 6 times cheaper. See the summary of factors costs on the ANDI website.



- The workforce is skilled and cheap; it is 10 times cheaper than in France.

 - Algeria's proximity to Europe. This motivates the relocation of industrial activities which consume energy.

- A country in the middle of an economic metamorphosis.

Weak Points
- Slow administrative procedures are often pointed out;


- The legislation is very complex, especially tax law.

- It is difficult to acquire industrial property.

Government Measures to Motivate or Restrict FDI
To attract and encourage foreign investment, the government has set up various attractive measures. You can consult these measures on the ANDI website.

At the same time, on the 22nd December 2008, the Algerian prime minister published a directive which leans towards restricting foreign FDIs. In effect, it has been provided that all new investment projects in Algeria have to have local majority (51%) shareholding.  This directive further provides that foreign investors should only revert to local financing.  Finally, FDI projects will no longer come under ANDI (National Agency for Investment Development) but under the CNI (National Investment Council), something which would engender delays in the handling of files.  More information on these new measures are available.

Bilateral Investment Conventions Signed By Algeria
Algeria has signed bilateral conventions with more than thirty countries. See the complete summary on the ANDI website. They define the framework for the protection of foreign investment in Algeria for each of the signatories. For European Union countries, the association agreement signed between the EU and Algeria governs this issue.

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Procedures Relative to Foreign Investment

Freedom of Establishment
According to the edict n°01/03 of 20 August 2001, any legal entity or natural person, public or private, can invest in economic activities concerning production of goods and services as well as in investments carried out in the framework of granting concessions and/or licenses. It is possible to enjoy certain advantages according to one's projects and their location (Edict n° 01-03).
Acquisition of Holdings
Acquiring a majority interest in a local company is authorized in Algeria.
Obligation to Declare
An investment declaration is necessary; it must be made to the National Agency for development and investment (ANDI) which depends on the Ministry of participation and promotion of investment (MPPI). Consult the websites of these organizations to find out further details.
Competent Organization For the Declaration
National Agency for Development and Investment
Requests For Specific Authorizations
Many products are subject to procedures to obtain prior authorization. See the list of controlled activities on the Register of Commerce website (in French).

Learn more about Foreign Investment in Algeria on, the Directory for International Trade Service Providers.

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Investment Opportunities

Investment Aid Agency
National Agency for Development and Investment
Tenders, Projects and Public Procurement
Tenders Info, Tenders in Algeria
DgMarket, Tenders Worldwide
Other Useful Resources
Economic Developments and Prospects in Algeria - African Economic Outlook

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Learn more about Investing in Algeria on, the Directory for International Trade Service Providers.

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Last Updates: November 2014