Tebboune to be confronted by daunting challenges as Algeria’s new president

Tebboune will need to convince protesters with tangible reforms to break the political stalemate and address urgent economic problems, including in the crucial hydrocarbons sector.
Sunday 15/12/2019
What comes next? A supporter cheers after the annoucement of presidential election results at the campaign headquarters of Abdelmadjid Tebboune in Algiers, December 13.  (Reuters)
What comes next? A supporter cheers after the annoucement of presidential election results at the campaign headquarters of Abdelmadjid Tebboune in Algiers, December 13. (Reuters)

TUNIS - Former Prime Minister Abdelmadjid Tebboune, declared winner in Algeria’s presidential election, will be confronted with restoring stability amid persistent unrest and also meeting the challenges of population growth and slumping oil output, the lifeline of a hydrocarbon-dependent economy.

Algerians voted for a new president December 12 in a controversial election marked by massive boycott and violence in the most restive areas. The official election body declared Tebboune the winner with 58% of the votes.

Algeria escaped feared irreparable damage of bloody confrontations amid tensions between crowds protesting the elections and security forces were deployed across the country to contain them.

That could be seen as an opportunity for Tebboune to bring the country together by satisfying demands of protesters clamouring for an overhaul of the military-dominated regime and snap parliamentary elections and a constitutional revision.

An appeased and stable Algeria is crucial for the welfare of its 43 million people and its neighbours in the Maghreb and Sahel.

Algeria’s 6,500km border abuts six other countries, many weakened by “Arab spring” uprisings, jihadist threats and foreign interventions. Despite difficulties at home under the ailing former President Abdelaziz Bouteflika, Algeria’s role made a difference for its three immediate neighbours: Tunisia, Libya and Mali.

Algeria discretely convinced Islamists and their secularist rivals in Tunis to pull back from possible confrontations in 2013, forge an entente and anchor a shaky stability that fosters coexistence between rival forces.

Algeria helped contain the conflict in Libya and has pursued reconciliation between Tuareg rebels and Mali as it struggled to unify the country against possible secession in the north and spreading jihadism.

Algeria made a diplomatic pivot to expand ties in Africa since 2014 after giving priority to its relations with the United States and the European Union as it fought a brutal civil war with radical Islamists for more than a decade beginning in 1992.

The assault by jihadists of a military base in Niger December 10, in which at least 71 people died, demonstrated the limits of strategies by France and other Western powers to stem jihadism in the Sahel and the need of Algeria’s role in its neighbourhood.

Tebboune will need to restore stability at home for Algeria to play a stabilising role in the region and address its internal challenges.

Protesters had dismissed the five presidential candidates, including four former senior officials under Bouteflika, as attempts to recycle the regime demonstrations sought to change.

Tebboune will need to convince protesters with tangible reforms to break the political stalemate and address urgent economic problems, including in the crucial hydrocarbons sector.

Algeria’s oil output slumped from 1.3 million barrels per day (bpd) in 2007 to around 950,000 bpd in 2019 mainly because of falling volumes from maturing oilfields with needed investments and technology upgrades from major oil firms that had been kept away by legislation that changed investor-friendly laws in 2006.

Economic stagnation followed, with GDP growth of 1.4% in 2017, 2.5% in 2018 and an expected 2.7% this year and with 1.9% expansion predicted for 2020.

Algeria needs robust growth to lower a persistently high unemployment rate. The youth joblessness rate is 31% in a country with an average age of 28.

“It is unlikely that any significant positive output change will take place before the end of the next decade,” said Mostefa Ouki, a former senior manager at Algeria’s national oil and gas company, Sonatrach.

The oil and gas sector accounts for 95% of foreign export revenue and almost one-third of Algeria’s GDP. The government has long subsidised the cost of food and other staples from oil earnings but it has been forced in recent years to curtail some subsidies.

Algeria recently moved to lure foreign investments, including enacting an oil law, but political stability is vital for investors, analysts said.

The law was designed as a return to the 1989-2005 period when tax incentives lured oil firms to explore and pump oil and gas from Algeria.

Beneath the appearance of prosperity on the back of high oil prices with Algeria amassing at least $1 trillion in 20 years since 1999, the population increased 1.9% in 2018, one of the highest rates of increase in the world, the government-run National Statistics Office said.

“This population expansion will intensify the problem of unemployment with 25% of university graduates already suffering from lack of jobs,” said Algerian population expert Ali Cherif. “The number of Algerians will reach 55 million between 2050 and 2100 when our oil and gas wealth is shrinking. This demographic situation is an international oddity.”

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