Algeria cancels commercial contracts with Morocco, raises questions

Analysts believe Tebboune’s diktat, if implemented, will confuse vital Algerian sectors and lead to the loss of one of the country’s most important markets, that of Morocco.
Wednesday 12/05/2021
A file picture of Algerian President Abdelmadjid Tebboune. (AFP)
A file picture of Algerian President Abdelmadjid Tebboune. (AFP)

RABAT – The Algerian Army, through President Abdelmadjid Tebboune, has acted to halt commercial diplomacy sponsored by Algerian and Moroccan companies in an effort to end the impasse in the relationship between the two countries.

Tebboune ordered on Sunday the country’s state and private economic companies to terminate their contracts with foreign entities “hostile” to Algeria, claiming that they harm its  “vital and security interests”.

Analysts said Tebboune’s decision was unlikely to have been taken without consulting the military establishment that controls decision-making in the state.

Tebboune put out a statement vehemently attacking the Algerian Insurance and Reinsurance Company (CAAR) and the Algerian Insurance Company (SAA). He gave the companies ten days to end all collaboration with Moroccan firms,

Tebboune’s justification for the decision is that cooperation with Moroccan businesses  risks putting sensitive information at the disposal of “foreign entities” opposed to Algeria’s interests and undermining its security.

Analysts believe Tebboune’s diktat, if implemented, will confuse vital Algerian sectors and lead to the loss of one of the country’s most important markets, that of Morocco.

Mohamed Tayyar, a Moroccan researcher in strategic and security studies, said that Tebboune’s decision falls within the framework of the policyof hostility to Morocco adopted by Algeria’s rulers who are still fighting any attempt at expanding cooperation between the peoples of the Maghreb.

He told The Arab Weekly that “Tebboune’s directives are part of the escalatory measures that Algeria’s rulers pursue against Morocco. These measures take many forms and include many fields. They are adopted without taking into account the interests of the Algerian people, who are going through a very critical phase with a steep rise in the unemployment rate and a significant economic decline as shown by recent figures.”

Tayyar noted that the phrases used in Tebboune’s statement echoed past systematic hostility toward Morocco.

Observers see the Algerian president’s decision as a form of preemptive blackmail in anticipation of Morocco’s refusal to extend the agreement over the Algerian gas pipeline that passes through Morocco to Spain. If the agreement is not renewed, Algeria could lose a key gas market, with Morocco being the largest importer in North and West Africa.

Observers expect Algiers to push for the renewal of the agreement to supply Morocco with about 640 million cubic metres of natural gas. The deal was signed  in 2011 for a period of ten years and will come to an end this November.

A report by the data analysis specialists  GlobalData, revealed in March that “Morocco is on the brink of unlocking its gas potential – even though the country is not a major producer and imports most of its gas. The country has almost 700bcf of reserves sitting in announced developments.”

Moroccan-Algerian relations have been strained for decades due to the conflict over the Western Sahara, where Algeria supports the Polisario Front separatists.

Tensions have increased between the two over the past few months after the United States announced the recognition of Morocco’s sovereignty over the Sahara.

A tug of war is also straining relations between Madrid and Rabat, more than two weeks after a row erupted over Spain’s decision to accept the leader of the Algeria-backed Polisario Front for medical treatment.

Earlier in April, Spanish officials revealed that Brahim Ghali, 73, is hospitalised in Spain for treatment of COVID-19.

Ghali, accused of war crimes and gross violations of human rights, was admitted by Spanish authorities with a false passport and identity. Algeria is suspected of having provided help to ensure his access to Spanish territory.