Once again, Tebboune mangles key economic data

Algeria

Published on Tuesday 2 April 2024 Back to articles

IMF estimates of Algeria’s real GDP growth

It is generally recognised that Algeria’s President Abdelmadjid Tebboune wants to stand for a second term. There are, however many in the regime — especially in the army and the old Département du renseignement et de la sécurité (DRS) — as well the political class and public who see him as incompetent. They believe that he should stand down, not simply because he is nearly 79 and has suffered from a near-fatal attack of COVID-19, but also because of his lack of communication and managerial skills.

He has long had a reputation for not having a good grasp of the economy or statistics which has proven embarrassing on many occasions. This has been of little consequence domestically — largely because most Algerians have long ceased to pay much attention to his pronouncements — but he has embarrassed the country on the international stage. For example, he was ridiculed following his address to the UN General Assembly on 19 September 2023 when he told the world that Algeria would soon have a daily production of 1.7 billion m3 of drinking water thanks to desalination. This is more than the global desalination total and therefore obviously impossible (Algeria Politics & Security – 26.09.23 and 10.10.23).

Tebboune’s reckless use of statistics is equally embarrassing and has handed more ammunition to his critics. At one of his periodic meetings with the domestic press — which was broadcast on national TV on 30 March — he told the country that he estimated that GDP would exceed US$400 billion by mid-2026, compared to US$194 billion in 2023. Tebboune had plucked this figure from highly dubious government projections provided to the International Monetary Fund (IMF) but, in fact, this gross over-estimate counts on a GDP of nearly the equivalent of US$400 billion in 2029 and not 2026 as he claimed. To reach US$400 billion the country’s very modest economic growth would have to grow at the inconceivable rate of around 50% in both 2024 and 2025. 

Tebboune’s claim that GDP in 2023 stood at US$247 billion is also misleading. As Algeria Politics & Security – 26.09.23 explained, this was based on the government’s recalibration of GDP to try and show that Algeria is wealthier than it is. In fact, neither the World Bank nor the IMF have yet validated the recalibration methods which saw Algeria increase its 2023 GDP from US$194 to US$247 billion.

According to the IMF the economy grew by 4.2% last year and is expected to remain strong at 3.8% in 2024 and 3.1% in 2025 before weakening between 2025-2029. By early 2026, and using the IMF growth forecasts, GDP would: on the unrecalibrated base of US$194 billion reach around US$208 billion; or US$264 billion on the recalibrated one. Both are far below Tebboune’s claimed US$400 billion. 

The question currently being asked is whether Tebboune is ‘deranged’, possibly as a result of his serious COVID-19 related illness, or just completely at sea when it comes to understanding the economy and economic statistics. Either way, he is confirming his detractors’ opinion that he is incompetent and should not stand for re-election.

This excerpt is taken from our Algeria Politics & Security weekly intelligence report. Click here to receive a free sample copy. Contact info@menas.co.uk for subscription details.

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