Africa has long been viewed as an indistinct bloc, mired in debt and instability. The IMF figures invite a more rigorous reading and for Algeria, more nuanced than it seems.
The fiscal map of the continent reveals three very different realities. Countries like Nigeria, DR Congo and Chad have debt below 40% of GDP – real latitude for borrowing and investing. Economies with moderate debt like Ivory Coast, Rwanda or Ethiopia whose future will depend on the quality of their reforms. And a minority, namely Zambia, Mozambique, Sudan and Senegal, which cross the symbolic threshold of 100%, each for reasons that it would be simplistic to confuse.
Regarding Algeria, it is in the second category, with public debt at 46.2% of GDP in 2024, a moderate ratio on the African scale. Apparently reassuring, but insufficient to conclude that there is serenity.
A flattering ratio, a worrying trajectory
The Algerian advantage is real since the debt is made up of 99% domestic debt, which protects the country from the monetary vulnerabilities which have stifled Zambia or Ghana. No exposure to international private markets, still comfortable foreign exchange reserves.
But behind this facade, domestic debt jumped by 83% between 2020 and 2024, growing faster than the wealth created. The IMF warns: without adjustment measures, the debt could reach 59.5% of GDP in 2029. Even more worrying, the IMF estimates the overall deficit at 13.9% of GDP in 2024, highlighting the persistent dependence on hydrocarbons and the insufficiency of non-oil taxation.
The hydrocarbon equation: the force that weakens
What distinguishes Algeria from the rest of moderately indebted Africa is the nature of its revenues. Hydrocarbons represent nearly 50% of budget revenues and 92% of exports, in other words a dependence that high prices have long allowed us to ignore. The system of subsidies – 600 billion dinars just for consumer products – is itself financed by oil surpluses, making the entire system vulnerable to any market downturn.
Meanwhile, foreign investments are stagnating structurally, with Algeria capturing only $1.43 billion in FDI in 2024, far behind Morocco or Egypt, a sign that the proclaimed diversification is slow to materialize in practice.
But today, fiscal space still exists. With almost zero external debt and reserves of 60 billion dollars, the country still has the means to act. Economists such as Abdelrahmi Bessaha recently reminded us: “2026 constitutes the last window for controlled adjustment”.
