Identifier
Created
Classification
Origin
05ALGIERS2213
2005-10-31 13:23:00
UNCLASSIFIED
Embassy Algiers
Cable title:  

Algeria Economic Highlights:

Tags:  ECON EINV EIND ETRD BEXP AG 
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UNCLAS ALGIERS 002213 

SIPDIS

E.O. 12958: N/A
TAGS: ECON EINV EIND ETRD BEXP AG
SUBJECT: Algeria Economic Highlights:


UNCLAS ALGIERS 002213

SIPDIS

E.O. 12958: N/A
TAGS: ECON EINV EIND ETRD BEXP AG
SUBJECT: Algeria Economic Highlights:



1. Spanish Group to Build Desalination Plant

2. $15 Billion Trade Balance Surplus

3. New Payment System Combats Money Laundering

4. Draft Law on Nuclear Energy

5. Sonatrach to Supply LNG to U.S. firm Sampra

SPANISH GROUP GEIDA SELECTED FOR DESALINATION PLANT
-------------- --------------


1. The Spanish group Geida (composed of Cobra-Sadyt-Abensur-
Codessa) was awarded October 19 the project for the
construction, exploitation and maintenance of a seawater
desalination plant in Tlemcen (western Algeria) with a
production capacity of 150,000 cubic meters per day. The
$158 million plant is scheduled to be operational in 24
months. The group landed a similar contract for a facility
in Skikda in May 2004 and for a facility in Beni Saf
(province of Ain Timounchent) the same month.

$15.5 BILLION SURPLUS IN TRADE BALANCE
--------------


2. According to the National Center for Information and
Statistics (CNIS),Algeria's trade balance for September
2005 recorded a $15.5 billion surplus, representing a 36%
increase compared to the same period last year. Overall
exports increased by 26.3%, reflecting $31.28 billion in
revenues. Hydrocarbon exports due largely to high oil
prices accounted for nearly 98% of export revenues at $30.59
billion. Non-hydrocarbon exports, although up by 8.5%,
remained insignificant at just 2.2% of Algeria's global
volume, bringing in a total of $687 million. Imports
increased by almost 18% at a total cost to Algeria of $15.72
billion. The U.S. ranked as the number one purchaser of
Algeria's exports, officially recorded at $6.4 billion,
followed by Italy ($4.4 billion),Spain ($3.98 billion) and
France ($3.2 billion). France remains Algeria's largest
source of imports at $3.5 billion, followed by Italy ($1.12
billion),the U.S. ($1.09 billion) and China ($977 million).

NEW PAYMENT PROCEDURES TO COMBAT MONEY LAUNDERING
-------------- --------------


3. The Algerian government adopted an executive decree
providing for new payment procedures aimed at combating
money laundering. The decree stipulates that effective
September 1, 2006, any amount equal to or greater than AD
50,000 ($684) must be paid by check, check card, or another
form of non-cash payment. The GOA expects this decree to
help curb money laundering, the underground economy, and tax
evasion.

A DRAFT LAW ON NUCLEAR ENERGY
--------------


4. The President tasked the Ministry of Higher Education
and Scientific Research to establish a working group to
propose a draft law on nuclear energy. For this purpose,
national and international experts participated in a two-day
seminar organized by Ministry of Mines and Energy Chekib
Khelil. The Minister declared that the law should be in
conformity with Algerian legislation and Algeria's
international commitments. "Algeria would like to show in
all transparency its good intentions for a peaceful use of
this form of energy", declared a researcher from the Algeria
Nuclear Research Center. He added, hinting at U.S. questions
about Algeria's nuclear potential, that "the draft law is a
way to protect Algeria from any media stir and fuss, as
experienced these past years". Algeria currently has two
nuclear installations. A one-megawatt reactor was
inaugurated in cooperation with Australia in 1986 in
Algiers, and a 15-megawatt reactor was established in 1993
in Tamanrasset (southern Algeria) with cooperation from
China. The Tamanrasset facility uses radio-isotopic
radioactive sources and uranium extraction methods to meet
national demand.

SONATRACH TO SUPPLY LNG TO SAMPRA ENERGY
--------------


5. The state-owned oil and gas company Sonatrach signed a
protocol agreement October 24 with the U.S. petroleum firm
Sampra Energy to supply liquid natural gas (LNG). This
agreement will enable Sampra to supply the U.S. market
between 250 and 500 million cubic feet of LNG per day for a
20-year period.