Deiss looks for economic progress in Algeria

Deiss (right) welcomes President Bouteflika to Switzerland in 2004 Keystone

The Swiss economics minister, Joseph Deiss, is on a two-day visit to Algeria aimed at improving trade relations between the two countries.

The trip comes a year after Algerian President Abdelaziz Bouteflika signed a bilateral treaty on economic ties in Bern, designed to boost confidence among potential Swiss investors.

“Economic relations between the two countries are not very strong – Switzerland essentially only imports hydrocarbons,” economics ministry spokeswoman Evelyn Kobelt told swissinfo.

“But Algeria is looking to improve its infrastructure over the next few years and it is investing more than $50 billion (SFr66 billion), so there are some interesting opportunities for Swiss firms, especially in the railway sector.”

With this in mind, Deiss – along with the Algerian transport minister Mohamed Maghlaoui – will be opening an Algerian-Swiss Rail Day on Saturday. The event has been organised by SwissRail, the umbrella organisation of the Swiss railway industry.

The chief executive of Swiss Federal Railways, Benedikt Weibel, will be accompanying the Swiss delegation.

Market reform

Another reason for Deiss’s visit is to gauge the extent of market liberalisation and structural reform in Algeria, which was launched in the mid-1990s.

The Swiss economics minister will be holding talks with the country’s minister for commerce, El-Hachemi Djaaboub, and its minister for participation and promotion of investments, Abdelhamid Temmar.

“The process seems to be progressing because the government is now more favourable to liberalisation and reform, and Mr Deiss will want to know how far they have come,” said Kobelt.

Deiss will also be discussing efforts to strike a bilateral deal between the European Free Trade Association (EFTA) and Algeria.

Switzerland and the other EFTA members Iceland, Liechtenstein and Norway agreed in Geneva this week to try to accelerate the process.

Swiss exports

Last year Swiss exports to Algeria rose by 37 per cent compared with 2003 to reach SFr190 million ($144 million). Imports to Switzerland – primarily oil and other energy products – climbed by just under a third to SFr168 million.

Viktor Grabik, responsible for sub-Saharan Africa at the Swiss Organisation for Facilitating Investments, told swissinfo that Algeria’s economic potential had yet to be fully exploited.

He forecast that economic exchanges would probably intensify in the future but that there was still a reluctance among foreign firms to take the plunge.

“The economy of Algeria is still to a large extent state controlled and that does not make the country very attractive to foreign firms, although the move towards liberalisation and privatisation is well appreciated by the Swiss business community,” he said.

“But in terms of investing today, Algeria does not offer any specific advantages over other countries in the region for sectors in which Swiss business has traditionally been strong.”

The Arab-Swiss Chamber of Commerce will be looking to change this perception next week when it hosts a major seminar in Geneva to promote investment in Algeria.

Wednesday’s event will focus on investment opportunities in the North African country, as well as taking stock of the political and economic climate.

swissinfo, Adam Beaumont

In brief

Switzerland played a key role in the Evian talks that ended the eight-year Algerian civil war in 1962, and the two countries have maintained close links ever since.

In November 2004 Algerian president Abdelaziz Bouteflika made a state visit to Switzerland, during which he signed a bilateral treaty on economic ties.

The Swiss primarily buy Algerian hydrocarbons and other energy products, while Algerians largely go for Swiss machinery, pharmaceuticals and chemicals.