ECONOMY

IMF welcomes Algeria's efforts to boost economic growth

WASHINGTON-The IMF Executive Board, which has just concluded its 2021 Article IV consultation with Algeria, has welcomed the country's efforts to boost economic growth and reduce dependence on hydrocarbons, modernize fiscal management and improve public sector efficiency.

"The IMF commended the authorities' recent efforts to modernize budget management and improve public sector efficiency," said the fund in a communiqué released on its website.

"Directors also welcomed forthcoming reforms to strengthen central bank independence and the strategy to revive growth and reduce the economy's dependence on hydrocarbons," said the source.

"They welcomed the focus of the new Government Action Plan and agreed with the reform priorities identified to help transition Algeria to a more inclusive and sustainable growth model," said the fund.

According to IMF, "recent announcements about plans to strengthen transparency and the anti-corruption institutional framework, enhance climate resilience as well as efforts to encourage digitalization, foreign direct investment, and competition to foster private sector investment and job creation are steps in the right direction."

"The Algerian economy is gradually recovering from the concomitant Covid-19 pandemic and oil shocks in 2020. The authorities' swift response helped mitigate the health and social impact of the crisis. Stepped-up vaccination and targeted containment measures have helped slow down the third wave of infection," said the fund.

Following a contraction of 4.9 percent in 2020, real GDP grew by 2.3 percent, on a year-on-year basis, in 2021Q1, driven by a rebound in hydrocarbon prices and production and the relaxation of containment measures. Real growth is forecast at 3.2 percent in 2021 and the external current account deficit is projected to narrow sharply as exports rebound, said the source.