U.S. exports stable in 1986 despite economic downturn - Algeria

U.S. Exports Stable in 1986 Despite Economic Downturn Despite a downturn in the Algerian economy, total U.S. exports to Algeria in the first six months of 1986 ($264 million) were slightly higher than the same period in 1985 ($255 million). U.S. imports from Algeria dropped from $1.5 billion in the January-June period of 1985 to $1.1 billion in the same period in 1986.

Algeria must depend on its hard-currency income (over 90 percent of which is derived from sales of hydrocarbons) to finance the external requirements of its economy. As a result of the decline in oil prices, foreign exchange resources available for funding imports are expected to drop about $2 billion this year, to about $8.4 billion. Key ministries are continuing to place orders, but purchases of many commodities and non-essential foodstuffs are being postponed. Equipment is often not being replaced or renewed.

According to semi-official media reports, the Complementary Finance Law, passed in June, will cut the 1986 current expenditure budget by 11 percent and the investment and development budget by 26 percent. While details of the law with respect to the various ministries are not yet available, the Minister of Plan has stated publicly that social infrastructure projects will have to wait and that productive investment will be emphasized.

Aalgerian agencies are insisting on generous credit terms when negotiating new contracts, and the Algerian government is strongly pushing countertrade arrangements for significant purchases. Going beyond its traditional hydrocarbon exports, Algeria is now attempting to include such items as phosphates, wine, and leather goods in countertrade arrangements.

Trade promotion events scheduled for the next year include an education/training aids trade mission in September 1986, a renewable energy resources video catalogue exhibition in October 1986, an agriculture machinery and equipment trade mission in November 1986, a medical equipment trade mission in February 1987, and a U.S. pavilion at the Algiers International Fair in June 1987.

COPYRIGHT 1986 U.S. Government Printing Office
COPYRIGHT 2004 Gale Group