Algeria: opportunities and challenges for Maltese companies

Transcription

1 Algeria: opportunities and challenges for Maltese companies Presentation 28 th June 2018 Ministry of foreign Affairs and Trade Promotion MALTA Mahfoud DORBHAN External Consultant TradeMalta

2 Objectives To provide a brief overview of Algeria, particularly to Maltese enterprises wishing to internationalise towards this country. To point out to potential pitfalls by sharing lessons learnt from past experience

3 Geography Algeria comprises of over 2.3 million square kms of land. Borders with several countries on the South, East and West. In the North it has 1400 km coastline with the Mediterranean sea.

4 Main Cities Algiers Capital city, smallest of the 48 Willajas (Provinces) in area but the largest in population size. Oran second largest and an important city, situated in the West of the country and proclaimed as the business city of Algeria. Setif is also a substantial industrial and commercial city. Other main cities are Blida, Annaba, Constantine, Tizi Ouzou, Bejaia, Batna and Tlemcen, Main cities in the desert: Ghardaia (The door to the Sahara) Hassi Messaud (the Oil and Gas city) Biskra Bechar Ourgla Tamanrasset;

5 Algeria Basic Facts Population: (Jan 2018) (An estimated 25% are under 15) Adult literacy rate : 80.2%; male: 87.2%; female: 73.1% Unemployment rate 9.9% ( April 2016). Significantly higher for youth (21.8%) and women (13.7%). Official languages ( Arabic and Amazigh) Business languages: Arabic and French Currency: Algerian dinar/ (DZD), Credit cards rarely used in Algeria. Some ATMs in major hotels and in the airport Exchange rate: 1.00 EUR = DZD Inflation: 4.6% ( Mars 2018) GDP per capita: euro ( 2017) Fuel prices: euro 0. 30/litre (Gasoline) and euro 0.16 ( Diesel)

6 My contribution Identifying potential partners for Maltese companies. Organising B2B meetings in Algeria or Malta. Assisted in the various business delegations to Algeria organised in past four years. Updating TM and Maltese companies with trade and investment data as well as information on companies. Work with Algerian trade and related associations to promote the different Maltese partnership options.

7 Doing business in Algeria Algeria has the reputation of being a difficult place; Maltese companies are eager and impatient to conclude and the need for companies and staff to speak French fluently can not be an obstacle. Algeria is a market where continuous and regular personal contacts predominate in the business environment and where personal relationships of trust are very important. This requires an investment mainly of time and personal presence. Regular visits to Algeria, especially during the early phase, are an important part of a successful market entry strategy, as is continuity. It s important for companies to build up a relationship with the same person, not just the company. The Government is intent on embarking on a process of diversification of the economy.

8 Business Opportunities Investment of $262 billion in infrastructure development projects in Algeria s new Development Plan ( ). It includes long-term energy plans, which includes a Renewable Energy Strategy with an investment of USD 100 billion by It should produce one third of all domestic energy from renewable sources. Algerians need the best expertise and know how to take on this challenge. Algerians are seeking partnerships with strong capabilities/ expertise in these fields. Maltese companies have to compete with their counterparts from France, Italy, USA, UK, Turkey and China amongst others.

9 Business Opportunities for Maltese companies 01 Construction, infrastructural works, related services and products (Construction, Environment & Water, Ports, Rail). Advanced engineering. Maritime sector including ship repair and development of ports and marinas Logistics. Renewable energy and recycling projects; waste management; clean up of ports. Aquaculture. Development of tourism infrastructure including hotel management. Capacity building in various sectors; vocational training, opening of private educational colleges in Algeria. The English language is a primary focus for the Algerian government. English language training is in regular demand from companies and this provides excellent opportunities for Maltese language schools.

10 Business Opportunities fro Maltese companies 02 Healthcare and pharmaceuticals. Financial and professional services. Opening of private health clinics. Information and Communications technology. Financial services. Exports of various consumer and industrial goods. Medical tourism to Malta. Agriculture ( know how and marketing of agricultural products). Agri food sector.

11 Pluses Similar Mediterranean culture. Excellent political ties. The Algerian government welcomes and incentivises such local/foreign joint ventures A high level of interest from Algerian entrepreneurs for concluding partnerships with foreign companies. A high level of interest from the Maltese side. High potential for the growth of the service sector. A Substantially large domestic market. A potential spring board to the rest of Africa.

12 Minuses Lack of direct flight connections.

13 Thank you.