Algeria, implications of the current crisis

Algeria

Published on Tuesday, 1 October 2019 Back to articles

Algeria’s political environment is becoming increasingly and dangerously confrontational. If this spills over into violence — which does not look likely but could change quickly — there could be disastrous consequences.

The immediate focus of confrontation is the presidential election which is scheduled for 12 December. This is being forced by dictatorial army chief General Ahmed Gaïd Salah on a population that is determined to resist.

If, as expected, the election is cancelled it would lead to chaos and an army putsch against Gaïd Salah could not be ruled out. If it does take place, it is likely to result in a weak and illegitimate president and a continuation of the Hirak and the current political stalemate, but with the balance shifted in favour of the people and a very unpredictable future.

If the election  takes place — most likely in similarly fraudulent conditions as President Abdelaziz Bouteflika’s election in 1999, with a single, regime-favoured candidate, such as Ali Benflis or Abdelmadjid Tebboune foisted on the population — it is conceivable that the new president could start to undertake at least some of the transformations demanded by the people. From the regime’s perspective this is the most optimistic outcome – but it is also perhaps the least likely.

Algeria is on a knife-edge. If the state increases its repression, or resorts to violence on one pretext or another, it could explode in social unrest. The regime seems aware of this and there have been signs, during the last few days of September, of it trying to de-escalate the tension.

However, as the resilience and determination of the Hirak appears to be growing, it would be foolhardy to predict whether the election will take place or not. We would put the odds at 50:50. At a push we might give a 1% greater chance to the election being held, but under conflict-ridden circumstances that could result in even more serious confrontation.

As far as security is concerned, the biggest danger in such a highly charged political atmosphere is that an incident, such as the police killings in Oued Rhiou in Relizane wilaya, could spark off nationwide unrest.

Despite the government trying to play down Algeria’s economic and financial difficulties, we believe that 2020, will, barring any windfall boom in oil prices, be an extremely difficult year, with 2021 possibly even harder. Further economic deterioration poses an increasing risk of social unrest.

Even if a new a Hydrocarbons Law is passed very soon it is unlikely that IOCs or other investors will be inclined to take much action until the country’s political future looks more settled.

Note: Menas Associates hosted a well-attended Breakfast Briefing on Algeria’s current political crisis at Lloyd’s of London on 25 September which received universal praise. The slides and 45 minute podcast are available for a nominal fee from here.

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