## IMF Staff Completes 2026 Article IV Mission to Algeria _IMF News, July 6, 2026_ ## Source details **Canonical URL:** [IMF Staff Completes 2026 Article IV Mission to Algeria](https://www.imf.org/en/news/articles/2026/07/06/pr26236-algeria-imf-staff-completes-2026-article-iv-mission) ## Other formats - [Markdown version](/en/news/articles/2026/07/06/pr26236-algeria-imf-staff-completes-2026-article-iv-mission/index.md) - [Structured JSON version](/en/news/articles/2026/07/06/pr26236-algeria-imf-staff-completes-2026-article-iv-mission/index.json) - [Bundle manifest](/en/news/articles/2026/07/06/pr26236-algeria-imf-staff-completes-2026-article-iv-mission/bundle-manifest.json) ## Bibliographic details - Published: July 6, 2026 --- ### Mission overview - IMF mission led by Mr. Charalambos Tsangarides visited Algiers during June 16–30 to conduct the 2026 Article IV consultation with Algeria. - End-of-mission press release conveys preliminary findings of IMF staff; views expressed are those of IMF staff and do not necessarily represent the views of the IMF’s Executive Board. - The mission “expresses its gratitude and appreciation to the authorities and all interlocutors for their warm hospitality and the open and constructive discussions.” ### Key recent developments and staff findings - Growth remained robust in 2025 and is estimated to have reached 3.9 percent, supported by important investment; growth in the hydrocarbon sector remained subdued. - Headline inflation increased in September 2025, due to a significant increase in jewelry prices and a moderate increase in food prices. - The fiscal deficit narrowed in 2025 to 10.5 percent of GDP, supported by large one-off dividends from state-owned enterprises (SOEs) and the Bank of Algeria (BA), as well as stronger nonhydrocarbon revenues, but it remained very large. - Public debt rose to 52.1 percent of GDP in 2025, driven by large financing needs. - Monetary conditions eased in 2025, alongside increased central bank financing of the government. - The current account balance deteriorated significantly in 2025 as imports surged, boosted by large public investments, and hydrocarbon exports declined; this led to a large decline in international reserves. - The parallel exchange rate premium remained elevated in 2025, despite measures introduced by the BA. ### Near-term outlook and projections - The near-term outlook remains broadly positive, as higher hydrocarbon prices are expected to boost export and fiscal revenues. - GDP growth is projected to remain robust at 3.8 percent in 2026. - Inflation is projected to increase temporarily. - The current account deficit is projected to narrow due to higher hydrocarbon prices and lower imports. - The fiscal deficit is projected to remain high. - Over the medium term, growth is expected to moderate; continued high deficits would continue to increase public debt and gradually reduce reserves. - The outlook depends on reforms to strengthen fiscal sustainability, diversify the economy, and boost private investment. ### Main risks - Hydrocarbon-price volatility. - Persistently large fiscal deficits. - Deep financial linkages between the government, SOEs and public banks (SOBs). - Continued reliance on monetary financing, which could undermine price stability and policy credibility. ### Fiscal policy recommendations - Implement a sizable fiscal consolidation in the near term, particularly given the widening current account deficit partly due to public investment. - Focus the fiscal consolidation strategy on mobilizing further nonhydrocarbon revenue and streamlining spending. Specific measures include: - Broadening the tax base. - Reducing tax expenditures. - Strengthening tax administration efforts to improve compliance and reduce informality through digitalization and stronger controls. - Reforming subsidies and social benefits. - Limiting transfers to SOEs. - Creating space for priority expenditures, including targeted support for vulnerable households. - Enhance public investment efficiency to support economic diversification goals. - Support the consolidation effort with stronger public financial management, fiscal risk management, and anchoring within a rule-based framework. - Diversify financing sources; mission welcomes initial steps including the first sovereign Sukuk issuance and expected financing from a regional development bank. ### Monetary and financial sector recommendations - Avoid monetary financing of the government; strengthen regulatory safeguards for any exceptional monetary financing to protect the central bank’s operational independence. - Strengthen the monetary policy framework by establishing low inflation as the primary objective and nominal anchor. - Tighten monetary policy if the inflation acceleration continues. - Improve liquidity management to align the interbank rate more closely with the policy rate and strengthen monetary policy transmission. - Increase exchange rate flexibility to enhance the economy’s ability to absorb external shocks. - Continue improving the functioning of the formal FX market, supported by a more consistent macroeconomic policy mix, to strengthen confidence and support private-sector activity. - Improve financial sector oversight to mitigate risks arising from strong financial linkages between the central government, SOEs, and SOBs. ### Structural and growth-enhancing reforms - Continue reforms to support stronger, more resilient, private sector-led growth. Priority areas include: - Improving the business climate. - Leveling the playing field between SOEs and the private sector. - Reducing trade restrictions and regulatory barriers. - Enhancing goods and labor market flexibility. - Reducing informality through digitalization and tax-regime reform. - Leverage Algeria’s geographical position and wealth of energy resources to strengthen its role in the energy market, especially with Europe and Africa. - Mission welcomes diversification efforts, including in mining and agriculture, and encourages continued reforms to strengthen competitiveness and private investment. ### Other notable points - Strengthening resilience is urgent due to eroded fiscal and external buffers. - The mission welcomes Algeria’s removal from the AML/CFT grey list as an important achievement and encourages authorities to sustain the reform effort. *IMF Communications Department, End-of-Mission press release dated July 6, 2026.* --- ## References - [IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance) - [Press Releases](https://www.imf.org/en/news/searchnews) - [PRESS CENTER](http://presscenter.imf.org/) - [https://www.imf.org/en/home](https://www.imf.org/en/home) _Source: https://www.imf.org/en/news/articles/2026/07/06/pr26236-algeria-imf-staff-completes-2026-article-iv-mission_