Algerian President Abdelaziz Bouteflika signed on Wednesday the budget law which sets an austerity plan and tax rises for the year of 2017.
The budget law 2017 was adopted unanimously by the lower house of parliament in November, and by the upper house in December. It is due to came into force by January after being signed by the president.
It provides an operating budget worth about 41.5 billion U.S. dollars, while the largest budget, about 10.1 billion dollars, has been allocated to defense ministry.
Meanwhile, about 3.6 billion dollars were allocated to the interior ministry a portion of which is destined to equipping police forces.
Following the lasting oil revenues crisis, the oil rich nation of Algeria was forced to cut public expenditures as part of an austerity plan for the second year in a row.
The Budget Law 2017 predicts several tax raises, including those of the value added tax, in addition to higher taxes on imported goods and energy products.
The opposition parties protested against this law, saying it will “affect the purchase power of ordinary people and therefore make them paying for the mistakes made by the government in recent years.”
However, the two ruling parties, the National Liberation Front and the National Democratic Rally, said the measures included in the budget law are the best measures. These two parties control a majority of 272 out of 465 seats in the lower house.
The government was forced to reduce expenditure for 2017 over oil revenues decline, given that hydrocarbons account for 94 percent of the North African nation’s total exports.
It explicitly shows the full dependence of the nation on oil revenues to supporting national economy, as well as social linked sectors, including health and education, in addition to subsidizing staple food and energy products.
Oil prices witnessed spectacular drop to under 40 dollars before slightly recovering following OPEC and non-OPEC meeting in Vienna. Enditem
Source: Algerian approves divisive budget law of 2017 –China Economic Net
