Minister Defends Algeria Decision to Resort to Unconventional Financing

Minister of Finance Abderrahmane Raouya defended Monday the decision of Algeria to resort, since the end 2017, to unconventional financing to cover a part of public spending, reiterating that the country is “sovereign” in its economic and financial choices.

Invited by the press to comment on the latest report of the International Monetary Fund (IMF) on the assessment of the Algerian economy, where the institution of Bretton Woods suggested “stopping of monetary financing from this year,” Raouya refused any resort to external debt by Algeria while defending the choice of the Treasury to resort to direct financing at the Bank of Algeria.

“They (IMF) want that Algeria resorts to external borrowing, but we are sovereign in our country and, with complete objectivity, we hope that it (the results of unconventional financing) will be as we wanted it to be,” said Raouya on the sidelines of the presentation at the Council of the Nation of the draft organic law on Finance Acts.

In its report, IMF underlined that the Algerian authorities still have opportunities to achieve the double objective of macro-economic stabilization and of promotion of sustainable growth.

But this requires, according to the Fund, to resort to a large range of funding options, notably the issuing of public debt securities at the market rate, public-private partnerships, sale of assets and external loans to finance well-selected investment projects.