Trading Partners

Trading Partners

As trade patterns changed, in 1989 the United States joined France and Italy to become one of Algeria's three major markets, as well as its suppliers. The appreciable growth in United States exports (US$948 million in 1990) resulted from a high level of Commodity Credit Corporation guarantees for United States agricultural sales and a considerable increase in sales of industrial equipment, aircraft, and spare parts. Other items that have dominated the United States share of the Algerian import market included pharmaceuticals, mining machinery, electric-power generating equipment, computers, plasticsprocessing equipment, medical supplies, and telecommunications gear. Algeria's economic austerity since the latter 1980s, however, limited the demand for imported finished products.

The resumption of contracts between Sonatrach and United States gas importers in 1989 was the main cause of increased United States imports from Algeria (US$2.6 billion in 1990). Anadarko Petroleum Corporation in October 1989 signed an oil exploration/production contract for US$100 million over ten years. Occidental Petroleum Corporation in June 1991 signed a similar contract for US$32 million. Pfizer in October 1990 signed a contract establishing a joint venture with the Algerian state National Enterprise for Production of Pharmaceuticals (Entreprise Nationale de Production de Produits Pharmaceutiques), for construction of a US$27 million pharmaceutical plant near Regha´a, east of Algiers. Air Products Company joined forces with Aire Liquide (France) in signing a contract with Sonatrach in July 1990 for construction of a US$90 million plant at Arzew to produce helium and nitrogen gases.

Despite its close relationship with France, as a socialist country committed to safeguarding its economic and political independence, Algeria has developed and maintained special links to developing countries and Eastern Europe. However, in the early 1990s it continued to rely heavily on Western industrialized countries for the bulk of its foreign trade. The European Community alone, for example, accounted in 1990 for 35 percent of exports and 40 percent of imports. By contrast, Algeria's partners in the Union of the Arab Maghreb--Morocco, Tunisia, Libya, and Mauritania--accounted for less than 2 percent of its trade. After diplomatic relations between Algeria and Morocco resumed in 1988, the five countries formed the union to promote "economic integration and cooperation" in February 1989. Algeria, Tunisia, and Libya have agreed since to construct a gas pipeline between Algeria and Libya across Tunisia.


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