AFREXIMBANK Recognizes Algeria as a Pillar of Economic Resilience in Africa

✍️ BY: Dr. Hana Saada

With low inflation, self-financed megaprojects, and robust foreign reserves, Algeria is hailed as the “African Exception” and a leading contender for emerging market status by 2027.

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Algiers, Algeria | June 11th, 2025 — In a glowing affirmation of Algeria’s economic trajectory, the African Export-Import Bank (AFREXIMBANK) has issued a report praising the country’s robust macroeconomic indicators, self-sufficient development model, and exceptional financial stability—placing it in sharp contrast to a continent grappling with mounting debt and fragile external balances. The report, titled “The State of Debt Burden in Africa and the Caribbean”, places Algeria at the forefront of African economic resilience and calls it an “African Exception,” reinforcing the findings of other leading institutions including the World Bank and the International Monetary Fund.

This latest endorsement strengthens the ambitions of the Algerian government, under President Abdelmadjid Tebboune, to elevate the country to the ranks of emerging economies by 2027, with a targeted GDP of $400 billion. The report underscores Algeria’s strategic direction—marked by budgetary sovereignty, diversified revenues, and prudent financial governance—as a unique model of sustainability on a continent under increasing fiscal strain.

A Model of Fiscal Sovereignty in Africa

What distinguishes Algeria, according to AFREXIMBANK, is its ability to finance its major infrastructure and development projects without resorting to external borrowing. In an era where debt distress is spreading across the Global South, Algeria stands out for its refusal to mortgage its future. “Algeria does not rely on external debt for its major investments,” the report notes, describing this as a rare and strategic expression of fiscal sovereignty that is seldom seen elsewhere in Africa.

Key performance indicators reveal a well-balanced economic engine: a GDP growth rate of 4.3%, contained inflation at 5.7%, and a stable benchmark interest rate of 3%. These figures are not just statistical achievements; they reflect the country’s coherent and forward-looking policies that prioritize national resilience, long-term sustainability, and independence from foreign financial pressures.

Foreign Exchange Reserves: Algeria Among Africa’s Elite

One of the most lauded elements of Algeria’s macroeconomic health is the strength of its foreign exchange reserves. The AFREXIMBANK report states that Algeria will project a coverage of nearly 17 months of imports in 2025—an exceptional figure, far exceeding the IMF’s recommended threshold of three months. This places Algeria in a rare category, along with only two other African countries: Mauritius and Libya.

While most African nations are projected to see their foreign reserves fall below the three-month threshold in 2025—an alarming indicator of vulnerability—Algeria continues to consolidate its external buffers. The report cautions that across the continent, the average reserve coverage, once above 10 months in the mid-2000s, has declined sharply to just 4.5 months in 2023 and is expected to drop further to 4.3 months.

Against this backdrop, AFREXIMBANK urges African governments to adopt sound reserve management, diversify their assets, and broaden their export base toward high-value and low-volatility sectors. Algeria’s performance in this domain is once again cited as exemplary.

A Strategic Outlier in a Continent Under Pressure

AFREXIMBANK’s report also offers a sobering overview of Africa’s growing debt crisis. It notes that just six countries—South Africa, Egypt, Nigeria, Morocco, Mozambique, and Sudan—will account for 50% of the continent’s total external debt by 2025. These countries are projected to carry significant fiscal burdens, with South Africa alone representing 13.1% of Africa’s debt, followed closely by Egypt at 12%.

In contrast, Algeria has taken a radically different approach—eschewing debt-driven development in favor of a model rooted in resource optimization, fiscal discipline, and national autonomy. This distinction has not gone unnoticed.

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