Huge peaceful protests again enveloped Algeria on Friday, opposing a fifth term for the ageing and ill president Abdelaziz Bouteflika.
The system has managed to keep a rigid economy afloat through its hydrocarbon earnings. But, while the country’s oil and gas sector is old it is, unlike the president, also on life support.
The regime may be able to defuse the current protests by letting go of Mr Bouteflika, if they can agree on an alternative candidate. Under its current model, though, Algeria’s problems will remain. The failings are twofold: a petroleum sector in gradual decline; and a failure to turn its earnings into a diversified economy and new export industries.
The country, an Opec member, reached almost 2 million barrels per day of oil output in 2005, but this has since drifted down to about 1.5 million bpd. Some smaller new fields will give a brief bounce in the early 2020s, but then decline will resume without significant new finds. And, of course, the fall in oil prices since 2014, even with some recovery subsequently, has slashed revenues.
Algeria remains the largest gas producer in Africa, and a key supplier to Europe via pipelines to Italy and Spain, as well as liquefied natural gas (LNG). It is important for replacing declining indigenous European gas output and preventing over-dependence on Russia.
But although output of marketed gas surged in 2016, overall it has been on an undulating plateau since 1999. A large part of the gain was achieved by reducing injection of gas into the ageing Hassi Messoud oilfield, in line with Opec cutbacks but compromising future output. The giant Hassi R’mel gasfield is dwindling, the cupboard of new developments is mostly bare, while exploitation of the country’s enormous shale gas resources has been held up by local protests and unattractive investment conditions.
Meanwhile, domestic demand is steadily rising. In a pattern common throughout the Mena region, subsidised pricing and a policy of energy-intensive industrialisation has led to consumption outpacing new supply. Consequently, even though 2017’s exports were up sharply on 2015, they have fallen 30 per cent since 2003.
Abdelmoumen Ould Kaddour, chief executive of state oil firm Sonatrach, has done his best to turn things around, including trying to provide a more attractive hydrocarbons law, and luring in ExxonMobil to explore the virtually untouched offshore. But he has been held back by his company’s bureaucracy and a lack of urgency in the rest of the government. Geoff Porter, a consultant on the country, notes rumours that Mr Ould Kaddour may be replaced.
Under the right leadership, the energy sector could be fixed, although it would be a long task. A previous reform effort, under Chekib Khelil, Oil Minister from 1999 to 2010, was undermined by vested interests and corruption allegations. With oil prices rising in his term, a liberal hydrocarbon law was replaced with windfall taxes and mandatory requirements for Sonatrach participation.
Transforming Sonatrach’s role and culture, speeding up the interminable approval of new fields, opening up more to international and private investment, attracting oil explorers into untouched parts of the vast Algerian territory, and reducing and targeting subsidies better, are all required. With among the best sunshine in the world, but little renewable energy deployment to date, solar power offers gas savings, job creation and possible electricity exports.
The country, though, has a long history of resource nationalism, dating back to its war for independence from France. Policies of privatisation are unlikely to be popular, whether under this government or a possible successor.
An even more intractable problem is the system’s reliance on petroleum revenues, and its inability to turn these into broad-based growth and jobs.
The Algerian economy features a heavy state hand, a lack of openness to international investment, and a reliance on creating employment through state jobs. Oil makes up 95 per cent of exports, in contrast to neighbouring Morocco, which has developed a promising manufacturing sector. Non-oil growth is only modest, and lower oil prices have led to wide budget and current account deficits in Ageria. Foreign current reserves, though still high, have halved since the oil price drop, and inflation has risen to 5 to 6 per cent as the government has printed money to cover deficits.
The state of petroleum markets has shaped Algerian politics before. In 1988, when the oil price collapse had undermined the economy, protests turned into lethal riots, and eventually into an opening up to democratic elections. With an Islamist party poised to win, the military’s cancellation of those elections triggered the brutal 1990s civil war.
In 2011, Algeria suffered some protests against poor living conditions and political stagnation, if not on the scale of neighbouring Tunisia, Libya or Egypt, but these were repressed. With oil prices rising then above $100 per barrel in response to the Libyan revolution, Algiers was able to offer subsidies and higher wages to buy acceptance.
The economic position today is somewhere between those two situations. Foreign debt is almost zero, and growth is low but positive, so there is still room for some handouts and relaxation of austerity measures. However, this would only buy a little time for vital reforms, while risking squandering what breathing space remains.
Algeria’s economy exemplifies many of the failings of its peers. But a large population and territory, an enviable geographic location, and other natural resources, give it opportunities. To respond to the protesters, this government or another needs to resuscitate the energy sector and resurrect its economy.
Robin M Mills is CEO of Qamar Energy, and author of The Myth of the Oil Crisis
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
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ELIO
Starring: Yonas Kibreab, Zoe Saldana, Brad Garrett
Directors: Madeline Sharafian, Domee Shi, Adrian Molina
Rating: 4/5
AndhaDhun
Director: Sriram Raghavan
Producer: Matchbox Pictures, Viacom18
Cast: Ayushmann Khurrana, Tabu, Radhika Apte, Anil Dhawan
Rating: 3.5/5
UAE currency: the story behind the money in your pockets
Europa League group stage draw
Group A: Villarreal, Maccabi Tel Aviv, Astana, Slavia Prague.
Group B: Dynamo Kiev, Young Boys, Partizan Belgrade, Skenderbeu.
Group C: Sporting Braga, Ludogorets, Hoffenheim, Istanbul Basaksehir.
Group D: AC Milan, Austria Vienna , Rijeka, AEK Athens.
Group E: Lyon, Everton, Atalanta, Apollon Limassol.
Group F: FC Copenhagen, Lokomotiv Moscow, Sheriff Tiraspol, FC Zlin.
Group G: Vitoria Plzen, Steaua Bucarest, Hapoel Beer-Sheva, FC Lugano.
Group H: Arsenal, BATE Borisov, Cologne, Red Star Belgrade.
Group I: Salzburg, Marseille, Vitoria Guimaraes, Konyaspor.
Group J: Athletic Bilbao, Hertha Berlin, Zorya Luhansk, Ostersund.
Group K: Lazio, Nice, Zulte Waregem, Vitesse Arnhem.
Group L: Zenit St Petersburg, Real Sociedad, Rosenborg, Vardar
The specs
Engine: Long-range single or dual motor with 200kW or 400kW battery
Transmission: Single-speed automatic
Max touring range: 620km / 590km
Price: From Dh250,000 (estimated)
Expo details
Expo 2020 Dubai will be the first World Expo to be held in the Middle East, Africa and South Asia
The world fair will run for six months from October 20, 2020 to April 10, 2021.
It is expected to attract 25 million visits
Some 70 per cent visitors are projected to come from outside the UAE, the largest proportion of international visitors in the 167-year history of World Expos.
More than 30,000 volunteers are required for Expo 2020
The site covers a total of 4.38 sqkm, including a 2 sqkm gated area
It is located adjacent to Al Maktoum International Airport in Dubai South
Notable salonnières of the Middle East through history
Al Khasan (Okaz, Saudi Arabia)
Tamadir bint Amr Al Harith, known simply as Al Khasan, was a poet from Najd famed for elegies, earning great renown for the eulogy of her brothers Mu’awiyah and Sakhr, both killed in tribal wars. Although not a salonnière, this prestigious 7th century poet fostered a culture of literary criticism and could be found standing in the souq of Okaz and reciting her poetry, publicly pronouncing her views and inviting others to join in the debate on scholarship. She later converted to Islam.
Maryana Marrash (Aleppo)
A poet and writer, Marrash helped revive the tradition of the salon and was an active part of the Nadha movement, or Arab Renaissance. Born to an established family in Aleppo in Ottoman Syria in 1848, Marrash was educated at missionary schools in Aleppo and Beirut at a time when many women did not receive an education. After touring Europe, she began to host salons where writers played chess and cards, competed in the art of poetry, and discussed literature and politics. An accomplished singer and canon player, music and dancing were a part of these evenings.
Princess Nazil Fadil (Cairo)
Princess Nazil Fadil gathered religious, literary and political elite together at her Cairo palace, although she stopped short of inviting women. The princess, a niece of Khedive Ismail, believed that Egypt’s situation could only be solved through education and she donated her own property to help fund the first modern Egyptian University in Cairo.
Mayy Ziyadah (Cairo)
Ziyadah was the first to entertain both men and women at her Cairo salon, founded in 1913. The writer, poet, public speaker and critic, her writing explored language, religious identity, language, nationalism and hierarchy. Born in Nazareth, Palestine, to a Lebanese father and Palestinian mother, her salon was open to different social classes and earned comparisons with souq of where Al Khansa herself once recited.
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
BIO
Favourite holiday destination: Turkey - because the government look after animals so well there.
Favourite film: I love scary movies. I have so many favourites but The Ring stands out.
Favourite book: The Lord of the Rings. I didn’t like the movies but I loved the books.
Favourite colour: Black.
Favourite music: Hard rock. I actually also perform as a rock DJ in Dubai.
Profile
Name: Carzaty
Founders: Marwan Chaar and Hassan Jaffar
Launched: 2017
Employees: 22
Based: Dubai and Muscat
Sector: Automobile retail
Funding to date: $5.5 million
Other simple ideas for sushi rice dishes
Cheat’s nigiri
This is easier to make than sushi rolls. With damp hands, form the cooled rice into small tablet shapes. Place slices of fresh, raw salmon, mackerel or trout (or smoked salmon) lightly touched with wasabi, then press, wasabi side-down, onto the rice. Serve with soy sauce and pickled ginger.
Easy omurice
This fusion dish combines Asian fried rice with a western omelette. To make, fry cooked and cooled sushi rice with chopped vegetables such as carrot and onion and lashings of sweet-tangy ketchup, then wrap in a soft egg omelette.
Deconstructed sushi salad platter
This makes a great, fuss-free sharing meal. Arrange sushi rice on a platter or board, then fill the space with all your favourite sushi ingredients (edamame beans, cooked prawns or tuna, tempura veggies, pickled ginger and chilli tofu), with a dressing or dipping sauce on the side.
The specs
Engine: 0.8-litre four cylinder
Power: 70bhp
Torque: 66Nm
Transmission: four-speed manual
Price: $1,075 new in 1967, now valued at $40,000
On sale: Models from 1966 to 1970
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Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
The specs
Engine: 4.0-litre flat-six
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
LOS ANGELES GALAXY 2 MANCHESTER UNITED 5
Galaxy: Dos Santos (79', 88')
United: Rashford (2', 20'), Fellaini (26'), Mkhitaryan (67'), Martial (72')
NBA FINALS SO FAR
(Toronto lead 3-2 in best-of-seven series)
Game 1 Raptors 118 Warriors 109
Game 2 Raptors 104 Warriors 109
Game 3 Warriors 109 Raptors 123
Game 4 Warriors 92 Raptors 105
Game 5 Raptors 105 Warriors 106
Game 6 Thursday, at Oakland
Game 7 Sunday, at Toronto (if needed)
More on animal trafficking
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The years Ramadan fell in May
Tonight's Chat on The National
Tonight's Chat is a series of online conversations on The National. The series features a diverse range of celebrities, politicians and business leaders from around the Arab world.
Tonight’s Chat host Ricardo Karam is a renowned author and broadcaster who has previously interviewed Bill Gates, Carlos Ghosn, Andre Agassi and the late Zaha Hadid, among others.
Intellectually curious and thought-provoking, Tonight’s Chat moves the conversation forward.
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How Voiss turns words to speech
The device has a screen reader or software that monitors what happens on the screen
The screen reader sends the text to the speech synthesiser
This converts to audio whatever it receives from screen reader, so the person can hear what is happening on the screen
A VOISS computer costs between $200 and $250 depending on memory card capacity that ranges from 32GB to 128GB
The speech synthesisers VOISS develops are free
Subsequent computer versions will include improvements such as wireless keyboards
Arabic voice in affordable talking computer to be added next year to English, Portuguese, and Spanish synthesiser
Partnerships planned during Expo 2020 Dubai to add more languages
At least 2.2 billion people globally have a vision impairment or blindness
More than 90 per cent live in developing countries
The Long-term aim of VOISS to reach the technology to people in poor countries with workshops that teach them to build their own device
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The specs
Engine: 4.0-litre V8
Power: 503hp at 6,000rpm
Torque: 685Nm at 2,000rpm
Transmission: 8-speed auto
Price: from Dh850,000
On sale: now
MATCH INFO
Inter Milan v Juventus
Saturday, 10.45pm (UAE)
Watch the match on BeIN Sports
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The specs
Engine: 77.4kW all-wheel-drive dual motor
Power: 320bhp
Torque: 605Nm
Transmission: Single-speed automatic
Price: From Dh219,000
On sale: Now
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The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
Wicked
Director: Jon M Chu
Stars: Cynthia Erivo, Ariana Grande, Jonathan Bailey
Killing of Qassem Suleimani
UAE currency: the story behind the money in your pockets
Killing of Qassem Suleimani
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%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Christopher%20McQuarrie%3Cbr%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20Tom%20Cruise%2C%20Hayley%20Atwell%2C%20Pom%20Klementieff%2C%20Simon%20Pegg%3Cbr%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%204%2F5%3C%2Fp%3E%0A