A delegation from the Mouvement des enterprises de France (Medef), the main French employers’ organization, is visiting Algeria on Monday and Tuesday 24 May.
It is led by the president of the organization, Geoffroy Roux de Bézieux. The visit is similar to an attempt to redeploy French companies in Algeria, after the significant decline in their presence for at least three years, against a backdrop of the political crisis between the two countries.
The decline of French companies in Algeria, with the departures of Suez, the RATP, the closure of the Renault factory in Oran as well as the cessation of car imports, has benefited operators from other nations, in particular, the Turks and the Chinese, considered more by enterprising than their French counterparts.
The president of Medef expressed the “disposition of French operators to continue to accelerate exchanges regardless of the political climate between the two countries”, but the quality of the political relationship is essential. This visit only came after the warming of relations between Algiers and Paris, after several months of unprecedented estrangement.
It also occurs in an internal context in Algeria marked by the rise in hydrocarbon prices, synonymous with a possible return of public procurement to high levels, and the effective start of the economic reform project. After a long wait, the new investment code was adopted by the Council of Ministers on Thursday, May 19, and should come into force in about twenty days, as announced by the Head of State during his visit to Turkey.
Geoffroy Roux de Bézieux spoke at length about the investment climate in Algeria during a lively press briefing on Monday, May 23 on the sidelines of a business forum with the Algerian Confederation of Citizen Employers (CAPC).
“We need fiscal and legal stability to invest (…) French companies want and are ready to co-locate. The only downside is that we need to be long-term and this duration needs a clear legislative framework. We need to be certain that when a law says one thing, the next law the year after will not change it. I say this for both Algeria and France or any other country. We need legislative and fiscal stability,” he explained.
” A good sign “
In addition to the political reasons which may have influenced the French economic presence, the business climate deemed unfavorable and particularly the untimely changes in the legislation also weighed on the flow of FDI, French or otherwise, to Algeria.
For the president of the Medef, “the evolution of the legislative framework is an important criterion for promoting investment”, assuring that “a government which gives signs of openness to the outside world will attract investors over the long term and in co-location and co-production”.
Algeria has just taken a big step in this direction with the development of a new investment code, despite some criticisms that are already targeting the new text. Even if he admits that he has not read the bill in its entirety, the boss of French bosses considers it a “good sign”.
“It’s a really good signal. What we need is to know the level of taxation, what are the strategic sectors, and where can we be in majority or in majority partnership. The rules simply have to be known in advance” and that they “do not change according to the referee”, he pleaded.
President Abdelmadjid Tebboune has indicated that he wants a law that will remain valid for at least ten years, and among the guarantees introduced in the new investment code concerning legal stability, any future amendments to its provisions will not apply to investments already launched without the explicit agreement of their promoters.
This guarantee, and all the others as well as the incentives contained in the text, are intended for all foreign investors, regardless of their nationality.
French operators, even if they have lost ground in recent years, have on the other hand this additional advantage of not being in uncharted territory, France having been for a long time Algeria’s leading economic partner.
They can also be able to count on other factors such as geographical and cultural proximity as well as the weight of the human dimension in the Franco-Algerian relationship.
The interest of the French for a strong comeback on the Algerian market is in any case palpable. The visit of the Medef delegation is the second economic event of its kind in just two months, after the “Algeria Meetings” organized last March by the Algerian-French Chamber of Commerce and Industry (CCIAF).
