The government is using a combination of violent censorship (lots of journalists arrested and jailed or expelled if foreigners), deficit spending, taking good care of the security forces, discouraging luxury imports and foreign travel to keep an increasingly unhappy population calm. The government also benefits from and fractious and uninspiring political opposition that could win national power if they had a recognizable leader of a united coalition. So unemployment remains over 10 percent and growing (thanks to more young workers who cannot find jobs), corruption continues to discourage initiative, entrepreneurs or innovation and oil revenues continue to decline. The half-century of oil income allowed the development of a corrupt political elite that brutally suppressed a decade-long Islamic terrorist uprising in the 1990s and uses popular aversion to using another uprising to change the government. But as time goes on memories of the 1990s violence fade and armed insurrection becomes more appealing to a growing population of unemployed. Algeria is another national uprising waiting to happen.
The government has a time limit on how long it can buy off a popular uprising. It all depends on how long the foreign currency reserves last. They dipped below $100 billion at the end of 2017 and are headed for $85 billion at the end of 2018. The government inability to reform (suppress corruption) the economy quickly enough to reduce vulnerability to low oil prices becomes obvious when the foreign reserve situation is reported, as they must be (to placate foreign exporters and lenders). Foreign exchange reserves, essential to pay for imports, fell to $105 billion in mid-2017 and were clearly on a persistent downward trend.
This is not a new problem because foreign currency reserves were $193 billion in mid- 2014 and even then there were calls to cut non-essential imports. The government cut its budget 14 percent in 2017 in order to get the budget deficit down to 8 percent (versus 15 percent in 2016). Even so after five more years of this, the foreign currency reserves will be less of a cushion and more of a threat because of all the additional budget cuts. Most of the problem is with the administration's decisions that are already made. Despite the problems with oil income and government reforms GDP grew about two percent in 2017 and is headed for about four percent in 2018.
The High Cost Of No Challengers
With no serious opposition apparent in the 2019 presidential elections the man who has held the job since the 1990s, Abdelaziz Bouteflika is apparently running again. Although confined to a wheelchair he can still appear at public events and on TV, but not frequently. Since he suffered a stroke in 2013 his close associates (family, friends and political allies) have managed to hold tight the reins of power with or without a lot of help from the elderly (now 81) and ailing president. Bouteflika will run for president again because he is still alive and his associates cannot agree on a replacement. Bouteflika has been president since 1999 using a rigged system that blocks opposition candidates and generally guarantees Bouteflika will get reelected. Bouteflika has retained power by taking care of key groups (the security forces, key politicians and non-government leaders). At the same time, Bouteflika is considered a more successful ruler than most others in the Arab world and that counts for a lot.
Another Reason Why We Cannot Have Nice Things
For the third year in a row, the government has had to take extraordinary measures to block high school students from cheating on the final exam (the Baccalaureate) that determines who can go to college (which is free for those who qualify). Earlier in June police finally arrested those believed for the 2016 theft of the final exam and posting it online. Such rampant cheating is common in many countries that have serious problems with corruption. In 2017 it happened again and thousands of students were forced to take the exam again (using a different exam that was hastily prepared and handled by far fewer people). The main culprits are officials of the education ministry who see an opportunity to make some money by selling the exam. But some students disagree with this and then post the exam online so everyone will have access to it and the government will have to take action.
In 2016 the government shut down nationwide Internet access for a few days when the exam was being administered and banned students from having their cell phones in the exam room. This did not prevent many students from cheating by knowing the questions and studying to do well with them. This was a major high school final exams cheating scandal made possible by widespread use of the Internet and cell phones. These two technologies have made it easier to cheat and now this was happening on a mass scale which invalidated the purpose of the exams and made the results worthless in determining who could get into university, especially ones outside Algeria. Some Algerians saw the five day Internet shut down this year as a government effort to test extreme Internet censorship techniques. It was noted that experienced Internet users could get around the shutdown but most of the 27 million Algerian Internet users took the loss of network access as a personal affront. Some 80 percent of Algerian Internet users access the web via cell phones.
Algeria is not unique when it comes to large-scale exam cheating and some nations, like India, are even worse. Many cheaters who get high grades and accepted to foreign universities are found out when they take tests in Western nations and do much less well. But in Algeria, it is possible for someone good at cheating to have a long and prosperous career in a field that does not require a lot of technical knowledge. This is why wealthy Algerians go to Europe or the United States if they have serious health problems and hire a lot of Western technical personnel even though, on paper, there are a lot of Algerians who could do the job.
June 20, 2018: In the far south, on the Mali border, seven Islamic terrorists surrendered, with their weapons, to an army patrol. For over a month now the army has publicized border zones where Islamic terrorists seeking to surrender can cross while armed and not be shot on sight. Islamic terrorists seeking to surrender are advised what to do when they encounter troops. Intelligence indicates there are a growing number of Islamic terrorists in northern Mali who want to get out of the terrorism business.
June 13, 2018: Algeria and Turkey joined forces in the UN to propose that Israel be condemned for defending itself against Hamas attacks on the border. Hamas has been using large crowds of civilians to rush the border fence so that armed Hamas personnel could get into Israel to carry out terror and kidnapping missions. The United States used its veto to block this proposal and criticized Moslem nations for supporting these UN proposals that justify and excuse Islamic terrorism. Algeria has always used such proposals in the UN to demonstrate its moral superiority. Extremely corrupt nations often do this and there are a lot of those in the UN. Going after Israel for defending itself continues even as many Arab nations now regard Israel as a valued ally against growing Iranian aggression.
June 12, 2018: The UAE is being blamed for backing an attempted coup in neighboring Tunisia. It is unclear exactly what the UAE hoped to get from such a scheme. Many of those denouncing the UAE insists that Israel was also involved as were other Western nations. This appears to be more a malicious rumor that an actual event but it got a lot of attention in Algeria.
June 10, 2018: In the capital (Algiers) a Chinese citizen was robbed and murdered in daytime and China is pressing Algeria to find the killers and improve the security for more than 40,000 Chinese in Algeria. China has billions of dollars construction projects in Algeria. For example, a Chinese firm is building a new port facility 60 kilometers west of the capital that will cost $3.3 billion. China is paying for it and Chinese builders handling the construction say that by 2025 the 23 docks in the new port will be able to handle 26 million tons of cargo a year, most of it in containers. China and the Algerian government will operate the port, which will be one of the largest in North Africa.
China is becoming a major presence in Algeria. By 2013 Chinese firms had invested $1.5 billion in Algeria and there were some 30,000 Chinese working in Algeria for fifty Chinese companies. Since 2013 Chinese investment has grown enormously and by the end of the decade will amount to more than $1o billion in just twenty years. Most of the Chinese are working on transportation (roads, ports and railroad) projects. Although Algeria has lots of unemployment, there are few people with the necessary skills for many of these projects, so China brings in skilled workers from China. Some of those Chinese will settle down in Algeria, but not as many as in non-Arab Africa. The Arabs are not as accepting of foreigners as many other cultures are. While many oil-rich Arab states import foreigners for most of the civilian jobs, these workers are not encouraged to stay and there are strict laws governing the presence of the foreign workers. Algeria sees the Chinese investments, especially in infrastructure, as a way to get the local economy growing and thus provide jobs for the many young Algerians who are increasingly angry about being unemployed. The Chinese workers are very efficient and tend to get their projects done on time and on budget. This makes the Chinese popular with the government which, mainly because of corruption, is notoriously inefficient, especially when it comes to building things for the public.
June 1, 2018: During May Islamic terrorist activity in Algeria continued to decline. Security forces killed three Islamic terrorists during the month. In addition, four were arrested and 17 surrendered. Police also arrested eight people who were supporting Islamic terrorists. Army patrols continued to find bunkers and other hiding places for Islamic terrorist supplied. In May 108 of these hiding places were found, most of them apparently not used for years. But many contained weapons, ammo, explosives, equipment and food supplies.
May 31, 2018: In the east, on the Tunisian border, Tunisian troops clashed several times with two groups of Islamic terrorists who were attempting to attack a border crossing. The fighting went on overnight and the Islamic terrorists were repulsed and retreated into the mountains on the Tunisian side of the border. Algerian troops were called out to reinforce the Algerian side of the border crossing but were apparently never engaged by the Tunisia based Islamic terrorists.
In the far south on the Mali border, an army patrol found another hidden shipment of weapons and ammo brought across the border. The weapons were apparently meant for some of the few Islamic terrorists still active in Algeria. Most of the smuggling from Mali into Algeria consists of drugs and high-value commercial goods.
May 30, 2018: In the east (Skikda province, 500 kilometers from the capita) troops found and destroyed two Islamic terrorist bunkers that contained 700 kg (1,500 pounds) of explosives, detonators and three completed bombs as well as food supplied.
In the far south, on the Mali border, an Islamic terrorist surrendered, with his weapons to an army patrol.
May 29, 2018: Near Ain Defla (100 kilometers west of the capital) soldiers who had set up an ambush believed used by Islamic terrorists succeeded in encountering one who was shot dead and his assault rifle was recovered.
The government decided to deport 105 Mali Islamic terrorists it had imprisoned. Most of these men belong to Ansar Dine, an al Qaeda affiliated Islamic terror group. Many Ansar Dine members fled Mali after the French-led a 2012 operation to clear Islamic terrorists out of northern Mali and have continued to hunt down Ansar Dine and other Islamic terrorists in Mali and neighboring countries. Algeria was a convenient escape route but the Mali Islamic terrorists found that they were easy to spot and the generally hostile (to illegal migrants and Islamic terrorists) Algerians were quick to report the strangers.
May 28, 2018: In France, a peace conference led to both Libyan governments agreed to hold elections on December 10th to determine the composition of one national government. Islamic conservatives tried to prevent LNA commander Khalifa Hiftar from attending this conference. That effort failed because the other Libyans realized that Hiftar was part of the solution and the Islamic conservatives are not. Algeria, Egypt and Tunisia agreed to back Hiftar as well.
May 24, 2018: In the far south, on the Mali border, five Islamic terrorists surrendered, with their weapons to an army patrol.
An Algerian blogger (Merzoug Touati) was convicted of espionage and sentenced to ten years in prison. Touati has been in jail since January 2017 and was accused of operating a blog in which he reported about protests in Algeria against government policies. He also reported details of the violent tactics police often used to break up protests and also posted an online interview he conducted with an Israeli official. This prosecution is meant to discourage other bloggers, at least those living in Algeria.
May 21, 2018: Egyptian, Tunisian and Algerian officials met in Algeria in a continuing effort to work out a common policy on Libya. At the moment Libya is in the midst of forming a national government for the first time since 2011. Neighboring countries want to ensure that none of them support disruptive factions inside Libya. Algeria and Egypt have had their differences about who to support in Libya but now appear to have resolved that problem and want to keep it that way.