17 December 2013

Algeria: French, Algerian PMs Push Economic Cooperation As Chinese Competition Looms

French Prime Minister Jean-Marc Ayrault and his Algerian counterpart Abdelmalej Sellal vowed to increase economic cooperation during Ayrault's two-day visit to Algeria on Monday. France is the biggest foreign investor in Algeria but faces stiff competion, particularly from China.

On Tuesday Ayrault and Sellal were to visit the city of Oran to take a ride on the French-built tram network, which opened in May this year, and visit French companies, notably cement-maker Lafarge, the biggest French investor in the country.

Another important stop was a factory being built for carmaker Renault, which is to produce the first Renault Symbols for the Algerian market by the end of next year.

On Monday Ayrault, who is accompanied by nine ministers, signed about a dozen trade agreements.

Referring to Algeria's bitterly fought war of independence and the tense relations between the two countries that followed, Sellal declared that the "vicissitudes of the past" were overand "we are loooking to the future" by concentrating on economic cooperation.

France is still Algeria's main investor, but it is seeing competition from elsewhere, notably from Spain, Italy and China, which has overtaken France as Algeria's biggest supplier of goods and is very active in construction.

France is Algeria's fourth importer, notably of petroleum products.

In late October Algeria announced it had discovered a massive oilfield that would be extracted using hydraulic fracturing, known as "fracking", a controversial method of extracting oil and gas from shale rock and has been banned in France.

Algerian shale oil and gas could be of interest to France, according to François Kalaydjian, of the French institute of Petroleum and New Energy, although he feels France should also focus on its own reserves.

President François Hollande visited Algeria a year ago.

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