Arabfields, Adel Serai, Economic Analyst Arabfields — Algeria is stepping up efforts to strengthen domestic production and reduce reliance on imports, as new administrative procedures and digital reporting requirements reshape the way businesses plan their operations.

The government is seeking to build a more diversified economy by encouraging local manufacturing, improving oversight of imports and promoting non-hydrocarbon exports. But for many small and medium-sized enterprises, the transition is bringing new paperwork, longer planning processes and uncertainty over access to imported materials and spare parts.

For a factory manager waiting for essential components, the issue is practical rather than political. A delayed shipment or an incomplete import authorisation can disrupt production schedules, increase operating costs and put pressure on relationships with customers.

The authorities have defended the measures as necessary to improve transparency, monitor industrial needs and ensure that imports reflect genuine production requirements. Digital platforms are increasingly being used to collect information on companies’ activities, input requirements and planned purchases from abroad.

The policy comes at a time when Algeria is seeking to reduce its exposure to fluctuations in oil and gas revenues. According to the International Monetary Fund’s September 2026 assessment, the economy is projected to grow by 3.8% in 2026, supported in part by hydrocarbon revenues and investment. However, the IMF has warned that large fiscal deficits and declining external buffers remain significant challenges.

The pressure on the external position is particularly important. The country’s current account deficit widened to an estimated 8.9% of gross domestic product in 2025, as imports increased and hydrocarbon exports weakened. International reserves also came under pressure, highlighting the importance of managing foreign currency inflows and import spending carefully.

For business owners, the challenge is finding a balance between complying with the new rules and keeping production moving. Smaller companies often have fewer administrative staff and less financial flexibility than larger industrial groups. Preparing detailed import programmes and responding to requests for additional documentation can therefore absorb time and resources that would otherwise be devoted to production, sales and investment.

The government, meanwhile, faces a difficult balancing act. Restricting imports too aggressively could limit access to machinery, industrial components and intermediate goods that domestic manufacturers still need. Allowing imports to expand without adequate monitoring could put further pressure on foreign exchange reserves and weaken incentives to develop local suppliers.

The longer-term ambition is to increase the share of economic activity generated outside the energy sector. Agriculture, manufacturing, mining and other non-hydrocarbon industries are expected to play a larger role as investment projects advance and export capacity develops.

Looking ahead, Algeria’s economic growth is projected to remain positive, although the pace will depend on investment conditions, energy prices and the effectiveness of structural reforms. The IMF expects growth to moderate towards 2.9% over the medium term under its baseline scenario, underscoring the risks of relying on public spending and hydrocarbon revenues without stronger productivity gains.

Digitalisation could help ease some of the current tensions if it leads to faster approvals, clearer requirements and more consistent decisions. Better data could also help the authorities identify gaps in domestic supply and direct investment towards products that Algeria continues to import in large quantities.

For companies, the decisive test will be whether the new procedures become more predictable over time. Businesses need reliable access to essential inputs, while policymakers need credible information to guide industrial and trade policy.

Algeria’s drive towards greater economic independence will therefore depend not only on controlling imports, but also on building competitive domestic industries capable of meeting market demand. The success of that transition will ultimately be measured in factory output, investment, jobs and the ability of local producers to compete beyond the domestic market.