After two decades of investment efforts financed primarily through external debt and domestic bank loans, Algerian economic development has remained dependent on hydrocarbon resources. As a result of “managed” resource allocation and petroleum price volatility, the economy registered persistent financial instability through the first half of the 1990s, despite the stabilization and adjustment programs and related exceptional financing arrangements. The Algerian economy remained highly vulnerable to external shocks until the beginning of the 2000s—a period characterized by restored macroeconomic equilibrium.

Policies to Harness the Power of Natural Resources