he enthusiasm with which he was greeted was astonishing. Forty years after more than 500,000 people had died in the bloodiest independence struggle in modern history, adoring crowds flocked to the streets waving Algerian and French flags chanting his name, while the President himself flew around the country offering eloquent speeches on the ideals of liberty, justice, and fraternity, insisting that France will stand by Algeria’s side as it meets the challenges of development.
These scenes suggested a sense of national rebirth; that Algeria had come to terms with its dark past and was now turning a page into a period of concerted development. But the undercurrents of this state visit were more ambiguous. France, intent on managing American power, was in the midst of rallying international support against the military invasion of Iraq. Chirac’s visit to Algeria was part of this effort to demonstrate how unpopular the United States’ policy on Iraq is among Muslims, just as much as it was about Algerian economic development. For Algerians too, a large part of the warmth with which the French president was received was derived from his position as the most outspoken Western head of state in his opposition to war in Iraq. Aside from the issue of Iraq, the prospect of a more open visa policy from the French – so young Algerians can leave Algeria – was probably the most enticing aspect of Chirac’s visit.

So to what extent has Algeria really turned the page into a period of development? In terms of the economy, despite almost two decades of reform, growth continues to be recalcitrant. This leaves Algeria enormously rich in resources, but poor in real terms. At nearly 2.4 million km2, Algeria is a country of vast assets, both natural and human. Its Saharan sedimentary basins contain hydrocarbons reserves that are among the world’s largest. The country also boasts significant deposits of non-fuel minerals, such as high-grade iron ore, phosphate, mercury, zinc, and even gold, along with strong agricultural resources. But GDP per capita, at $1,760, is 5% that of the United States. Real GDP growth has been outstripped in the last two decades by population growth, seeing an increase in unemployment, poverty, and social unrest. Political violence is also continuing, with 2003 experiencing a worrying increase in the level of killings. In the worse attacks since President Bouteflika granted amnesty to Islamist rebels in 2000, 53 soldiers and villagers were killed in two separate incidents earlier this year, with the government blaming the Armed Islamic Group and the Salafist Group for Preaching and Combat.
In the end, a new Algeria – one of high growth and high employment – has yet to emerge. Getting there, most observers argue, depends on greater and more fundamental economic reform. But this is increasingly unpopular in Algeria today, largely due to the lack of real improvements to living standards the process has generated so far. The upcoming 2004 presidential elections will therefore be a test case of Algeria’s political commitment to development. While high oil prices have allowed the country’s authorities to spend more in the last two years in an attempt to not only stimulate growth but to alleviate the pain of reform, the nature of commodity prices means that the government will not always have the luxury of spending its way through reforms if it wishes to remain attached to a balanced budget. The near future for Algeria will be a difficult path to navigate, but one which could hopefully realize the growth the people of Algeria deserve.