Algeria

Algeria

China’s engagement with Algeria can be traced back to colonial times when Beijing backed the independence movement in the North African country. Today, China’s relations with Algeria are among its strongest in Africa and the Arab world, encompassing the political, economic, energy, military, and cultural spheres.

Algeria

Written by Tin Hinane El Kadi.

Background

Bilateral relations between the People’s Republic of China (PRC) and Algeria can be traced back to the 1950s, when the PRC Government established close ties with Algeria’s national liberation movements. The 1955 Bandung Conference, also known as the Afro-Asian Conference, which was attended by Chinese Premier Zhou Enlai and delegations from Algeria’s National Liberation Front (Front de Libération Nationale, FLN), was a milestone in this sense. China viewed itself as the natural vanguard of emancipation movements, and the Bandung Conference was a golden opportunity to promote its own experience with guerilla warfare and combating imperial powers. Zhou’s speech on that occasion explicitly stated that China would side with the Third World, fighting imperialism and colonial domination.

In this vein, China played a central role in supporting Algeria’s struggle for independence from French colonial rule. Not only was China an early supporter of the FLN, but also it was the first non-Arab state to recognise the Provisional Government of the Algerian Republic (GPRA), in December 1958, barely two months after its establishment. Between 1958 and 1962, China assistedImen Belhadj, Degang Sun, with the assistance of Yahia Zoubir. 2015. ‘China in North Africa: A Strategic Partnership.’ In North African Politics: Change and Continuity, edited by Yahia Zoubir and Gregory White. London and New York, NY: Routledge. the National Liberation Army (Armée de Libération Nationale, ALN)—the armed wing of the FLN—with funds, arms, and training for Algerian fighters. As early as 1958, a group of GPRA representatives was invited to China to meet Chinese Communist Party (CCP) officials across the country. The following year, China hosted‘China Salutes Algeria.’ Peking Review, 7 April 1959, 3. an Algerian military delegation to ‘Algeria Week’. In 1960, two years before Algeria’s independence, Ferhat Abbas, the GPRA’s president, was received by Zhou Enlai to celebrate the PRC’s founding.

Algeria’s nationalism was rooted in socialist thought as an alternative paradigm to the oppressive nature of the capitalist colonial system. Yet, the relationship between Maoist China and the FLN was not simply based on abstract ideological affinities but was arguably a strategic alliance that worked in the interests of both parties. Overwhelmed with the consequences of the Great Leap Forward, the CCP used its support for Algeria to reaffirm its commitment to revolutionary ideology and expand its influence in North Africa. The FLN relied on the help of China to gain a monopoly on the representation of the Algerian nationalist movement.

After Algeria gained independence in 1962, political ties between the two countries intensified. Algeria played a key role in United Nations Resolution 2758Ann Kent. 2007. Beyond Compliance: China, International Organizations, and Global Security. Stanford, CA: Stanford University Press. See page 48. , which allowed the PRC to take over the representation of China at the UN Security Council, replacing Taiwan, in 1971. The PRC won with 76 votes in favour, 35 against, and 17 abstentions. This win would not have been possible without the support of 26 African countries, including Algeria, which played a crucial role in rallying other African states. As acknowledged by Mao Zedong himselfQuoted in Anshan Li. 2013. ‘China and Africa: Policy and Challenges.’ China Security 3(3): 69–93.: ‘We were brought back into the United Nations by our African friends.’ In recent years, Algeria joined leading regional Chinese-led platforms, including the Forum on China–Africa Cooperation (FOCAC) and the China–Arab States Cooperation Forum (CASCF). Overall, China’s relations with Algeria followed a trajectory from ideological affinities and political interests in the first three decades after the PRC’s founding in 1949, to economic pragmatism starting from the 1980s, reflecting evolving domestic imperatives in both countries.

BRI Status

Algeria signed a memorandum of understanding (MoU) to join Beijing’s Belt and Road Initiative (BRI) in September 2018 on the sidelines of the FOCAC in Beijing. In July 2019, the North African country ratified the MoU through a presidential decree signed by interim President Abdelkader Bensalah and published in the country’s Official Gazette. The decree stated that Algeria and China would cooperate in the fields of policy coordination and infrastructure interdependence, among other things.

Before joining the BRI, Algeria was the first country in the Middle East and North Africa (MENA) to enjoy a comprehensive strategic partnership and the highest level of bilateral relations with China. Visiting Algeria in November 2014, Yu Zhengsheng, Chairman of the National Committee of the Chinese People’s Political Consultative Conference, China’s top political advisory body, stated that the goal of this partnership was to ‘enhance exchanges at all levels, cement mutual political trust and promote pragmatic cooperation’ between the two nations. In 2018, Chinese President Xi Jinping concurred with this statement by pledging to promote further development of the partnership and continue the trend towards closer diplomatic ties. During the UN COP27 climate summit in Egypt in 2022, Algeria signed a second five-year strategic cooperation pact with China aimed at further strengthening bilateral cooperation.

Within the BRI framework, Algeria has inked a myriad partnerships with Chinese firms in various sectors, including infrastructure, industry, telecommunications, and energy. One of the hallmark projects of the BRI in Algeria is the Port of El Hamdania near the central city of Cherchell. The 3.3-billion-USD deepwater port is being built by a Chinese-Algerian consortium of firms, including the state-owned China Harbour Engineering Corporation, China State Construction Engineering Corporation, and Algeria’s Public Port Services Group. This infrastructure project is co-financed by the Algerian Government and the Export–Import Bank of China. However, progress has been slowLina Benabdellah. 2021. ‘Frozen in Time: China-Algeria Relations from Socialist Friendship to Pandemic Opportunism.’ In Routledge Handbook on China–Middle East Relations, edited by Jonathan Fulton. Abingdon: Routledge. since the first exploratory studies, back in 2012. More generally, despite much fanfare, the BRI has yet to lead to significant investments or job opportunities in the country.

Economic Relations

China has evolved from being a supporter of Algeria’s independence to one of its major economic partners. While diplomatic relations between China and Algeria can be traced to the early days of the establishment of the PRC, economic relations picked up only at the turn of the twenty-first century. In North Africa, Algeria holds the strongest commercial relations with China and is the leading construction market for Chinese firms.

Trade: Trade between Algeria and China increased significantly in the 2000s, making China Algeria’s top supplier, surpassing France in 2014. Mirroring key features of China’s trade patterns with the rest of the African continent, its exports to Algeria are dominated by finished manufactured goods such as electronics, automobiles, mobile phones, and clothing, while crude oil constitutes the bulk of Algeria’s exports to China. It is important to note that unlike trade relations with Gulf states, data on Sino-Algerian trade indicate a significant trade deficit for Algeria. For instance, in 2020, Algeria’s imports from China were worth about 5.6 billion USD, while its exports to China did not exceed 1 billion USD. This puts the trade deficit at 4.6 billion USD for 2020 alone. Overall, while Algerian consumers have benefited from the price competitiveness of Chinese products, Algeria’s manufacturing sector has suffered from the inflow of Chinese goods, which has accelerated the country’s de-industrialisation.

Source:Compiled by the author using data from the China–Africa Research Initiative, Johns Hopkins University (n.d.). Link.

Investment: Following Beijing’s ‘Going Out’ strategy in the late 1990s, many Chinese enterprises, both public and private, ventured to invest abroad, and Algeria witnessed an upsurge in the presence of Chinese multinationals. According to the Chinese Ministry of Commerce’s annual Statistical Bulletin on Chinese Foreign Direct Investment (FDI), Chinese FDI stock in Algeria increased from 34.5 million USD in 2004 to 2.45 billion USD a decade later. A confluence of factors led to a decrease in Chinese FDI stock in the country, to 1.64 billion USD, in 2020. One such factor is linked to the political uncertainty in Algeria following the Hirak, the social uprising that began in February 2019 with a series of protests against President Abdelaziz Bouteflika’s ambition to run for a fifth presidential term and later ballooned into a large-scale movement demanding meaningful political change.

Chinese investment in Algeria remains marginal, considering the volume of trade and contracts attributed to Chinese firms in the country. The distinction between service provision and FDI is important because these two types of transaction generate opposing financial flows. Algeria’s East–West Highway, the new airport in the capital, Algiers, and the Great Mosque of Algiers—all often described by the media as Chinese ‘investments’—are, in fact, juicy contracts awarded to Chinese construction firms by the Algerian Government. It is estimated that Algeria became the most significant market for Chinese construction firms, with the country granting an estimated 70 billion USD worth of contracts to Chinese firms between 2009 and 2019.

Source: Compiled by the author using data from the China–Africa Research Initiative, Johns Hopkins University (n.d.). Link.

Since the 2014 drop in oil prices, Algeria’s infrastructural catch-up plans have slowed, with the country’s foreign reserves shrinking from almost 200 billion USD in 2014 to about 49 billion USD in late 2020. The fall in hydrocarbon prices led to a decrease in the value of Chinese contracts in the country, as shown in Figure 2.

As a middle-income hydrocarbon exporter, Algeria is not a major recipient of Chinese aid and loans, however, the country has been the beneficiary of Chinese assistance programs since its establishment. In 1963, just one year after Algeria’s independence, China sent its first medical assistance team to the North African country, boasting once again of its solidarity with the FLN. More recently, during the Covid-19 pandemic, China was quick to make various contributions to Algeria’s fight against the virus. It provided personal protective equipment and shared technical and medical expertise. Sinopharm even launched a partnership with Algeria’s state-owned Saidal to produce its Sinovac vaccine for the domestic market.

Key Controversies

Corruption: Major controversies have emerged in recent years regarding the practices of Chinese businesses in Algeria. Executives of Chinese companies seeking market access have been charged with paying illicit commissions, bribes, and kickbacks. The most notorious corruption scandals in the history of Algeria’s telecommunications sector involved Chinese-headquartered Huawei and ZTE. A court in Algeria held two ZTE and one Huawei employee responsible for paying bribes totalling 10 million USD between 2003 and 2006 to obtain contracts from state-owned Algérie Telecom. The two Chinese firms were banned from tendering for public telecommunications contracts for two years in Algeria.

Algeria’s East–West Highway, which spans 1,216 kilometres, connecting Morocco to Tunisia, was also marred by corruption scandals. A Chinese consortium between CITIC and China Railway Construction Corporation won a bid to build about half the highway for 6.2 billion USD. However, large kickbacks were paid in the construction process, resulting in a significant increase in the final price. It is worth mentioning that these scandals were not peculiar to Chinese firms but had more to do with president Abdelaziz Bouteflika’s (in office from 1999 to 2019) mode of governance, which was characterised by endemic corruption.

Regime Support: Chinese officials did not miss the opportunity to reiterate their support for the Algerian regime during the 2019 Hirak, or popular uprising, that aimed to topple it. Although after the protests began in February 2019, President Bouteflika was forced to resign, the army, Algeria’s true powerholder, prevented a genuine democratic transition by imposing a regime insider as head of state. Yet, when the European Parliament adopted a critical resolution entitled ‘The Situation of Freedoms in Algeria’, criticising the regime’s arrest and harassment of political opponents, human rights activists, and journalists, China’s Ambassador to Algeria, Lie Lianhe, was quick to back the Algerian regime’s response by declaring that China was opposed to any ‘interference’ by foreign powers in the country. Building on the historically friendly relations between the two countries has proven useful in consolidating bilateral ties that have served the interests of both in maintaining regime stability domestically.

Key Sources

Benabdallah, Lina. 2021. ‘Frozen in Time: China–Algeria Relations from Socialist Friendship to Pandemic Opportunism.’ In Routledge Handbook on China–Middle East Relations, edited by Jonathan Fulton. London: Routledge.

Calabrese, John. 2021. ‘“The New Algeria” and China.’ All About China Series, 26 January. Washington, DC: Middle East Institute. Link.

El Kadi, Tin Hinane. 2019. ‘The Promise and Peril of the Digital Silk Road.’ Expert Comment, 6 June. London: Chatham House. Link.

El Kadi, Tin Hinane. 2021. ‘China and North Africa: History, Economic Engagement and Soft Power.’ In Routledge Handbook on China–Middle East Relations, edited by Jonathan Fulton. London: Routledge.

Pairault, Thierry. 2017. ‘La Chine au Maghreb: de l’esprit de Bandung à l’esprit du capitalisme [China in the Maghreb: From the Spirit of Bandung to the Spirit of Capitalism].’ Revue de la régulation. Capitalisme, institutions, pouvoirs [Review of Regulation. Capitalism, Institutions, Powers] (21). Link.

Pairault, Thierry and Fatiha Talahite. 2014. Chine–Algérie: Une relation singulière en Afrique [China–Algeria: A Peculiar Relationship in Africa]. Paris: Riveneuve Éditions.

Zoubir, Yahia H. 2019. ‘Les relations de la Chine avec les pays du Maghreb: la place prépondérante de l’Algérie [China’s Relations with the Maghreb Countries: The Prominent Position of Algeria].’ Confluences Méditerranée 109(2): 91–103. Zoubir, Yahia H. and Youcef Hamitouche. 2019. ‘China’s Relations with Algeria: A Strategic Partnership?’ In The Politics of Algeria: Domestic Issues and International Relations, edited by Yahia H. Zoubir. London: Routledge.

Updated on 13 January 2023.


Tin Hinane El Kadi is a political economy researcher. She is currently writing a PhD thesis at the London School of Economics and Political Science looking at China’s Digital Silk Road in North Africa. Her research interests include information and communications technology and development, the knowledge economy, China’s presence in Africa and the Middle East, and contemporary Algerian politics.