World Bank says Algeria's economy shows resilience

The World Bank says Algeria's economy has shown resilience, with growth of 3.8% in 2025, in remarks published by the daily El Moudjahid.

ObservAlgerie reported the remarks of Cemile Hacibeyoglu Ceren, resident representative of the World Bank Group in Algeria. Several indicators published by the bank support this view, including growth outside oil and gas, investment and slower inflation.

Growth beyond oil and gas

According to the World Bank, gross domestic product (GDP) grew by 3.8% in 2025, after 3.7% over the whole of 2024. In the first half of 2025, activity rose 4.1% from a year earlier.

Activity outside oil and gas rose by 5.4% in the first half of 2025. Investment grew by 13.2% from a year earlier, while household spending rose by 4.4%.

Services grew by 4.3%, non-oil industry by 4.2% and farm output by 5.3%. The bank says growth does not depend only on oil and gas, and that farming, services and some industries help widen its sources.

Inflation slowed further in 2025, reaching 1.4% over the first 11 months of the year, according to the World Bank. The bank cites lower food prices and a stable official exchange rate.

The bank also reports a rise in GDP per head in 2025. Household buying power benefited from slower inflation, higher wages and pensions, and new unemployment allowances.

Reliance on oil and gas

The bank stresses that the economy still depends heavily on oil and gas and on public spending.

Between 2020 and 2024, oil and gas made up 13.3% of GDP, 82.6% of exports and 45.8% of budget revenue.

According to the bank, lower energy prices, higher public spending and more imports for investment have widened the budget and external deficits. This structure makes the country's economic and financial balances sensitive to swings in energy prices on world markets.

Productivity is another challenge. The bank says growth over past decades relied mainly on capital build-up and new workers joining the job market, with limited productivity gains.

The bank also points to risks from climate change, mainly for farming.

Fertilisers, iron and steel are among the exports named by the bank.

What comes next

The bank calls for faster structural reforms. The priorities it identifies include a better business climate, more private investment, higher productivity and more efficient public companies.

The World Bank says creating lasting jobs remains a challenge.