On Wednesday, Prime Minister Abdelaziz Djerad promised a major overhaul of the country`s trade conditions, promising to review all economic and trade agreements “harmful to the country.” A few days before the expiry of a final deadline, the activation of a long-planned Algerian-EU trade agreement is in danger of breaking, with the North African country`s political and economic leaders warning that it would undermine economic sovereignty. Partnership priorities in the EU-Algeria relations between 2020 focus on a wide range of areas, including trade and access to the European single market, energy, the environment and sustainable development. Politicians and business leaders have strongly criticized the proposal for full implementation of the free trade area and see it largely at the expense of Algeria. Algeria has asked the EU to freeze a free trade agreement that is expected to be signed this year because of the length of customs reforms, an EU official said. The EU and Algeria meet regularly on committees to discuss issues and best practices in implementing the agreement. In 2002, Algeria signed an association agreement with the European Union in Valencia (Spain). It came into force on September 1, 2005. The trade agreement is part of the EU`s `Barcelona Process`, which aims to transform the Mediterranean basin into a vast free trade area under the EU`s dominant influence by 2017. (The European Free Trade Association - Iceland, Lichtenstein, Norway and Switzerland - also wants a free trade agreement with Algeria.) The Association Agreement between the EU and Algeria was signed in April 2002 and came into force in September 2005. This agreement establishes a framework for EU-Algeria relations in all areas, including trade. For its part, the Algerian government has signed a free trade agreement with neighbouring Tunisia, is a candidate for membership of the Arab Free Trade Area and wants to guarantee free trade agreements with the West African Monetary Union and Iran. In December 2008, the government announced its decision to fully join the GAFTA on January 2, 2009, which drew the ire of the economy.
Business leaders felt incoherent and had to lose the influx of cheaper goods from other Arab countries. Some have even threatened to outsource production to other GAFTA countries and export it to Algeria instead of producing it in Algeria.
