Economy—overview: The hydrocarbons sector is the backbone of the economy accounting for roughly 57% of government revenues 25% of GDP and almost all export earnings. Algeria has the fifth-largest reserves of natural gas in the world and is the second largest gas exporter; it ranks fourteenth for oil reserves. Algiers' efforts to reform one of the most centrally planned economies in the Arab world began after the 1986 collapse of world oil prices plunged the country into a severe recession. In 1989 the government launched a comprehensive IMF-supported program to achieve economic stabilization and to introduce market mechanisms into the economy. Despite substantial progress toward economic adjustment in 1992 the reform drive stalled as Algiers became embroiled in political turmoil. In September 1993 a new government was formed and one priority was the resumption and acceleration of the structural adjustment process. Burdened with a heavy foreign debt Algiers concluded a one-year standby arrangement with the IMF in April 1994 and the following year signed onto a three-year extended fund facility. Progress on economic reform a Paris Club debt rescheduling in 1995 and oil and gas sector expansion have contributed to a recovery since 1995. Investments in developing hydrocarbon resources are likely to maintain growth and export earnings. Continuing but gradual government efforts to attract foreign and domestic investment outside that sector seek to diversify the economy and tackle problems of high unemployment and falling living standards problems as yet untouched by the macroeconomic turnaround.

GDP: purchasing power parity—$120.4 billion (1997 est.)

GDP—real growth rate: 2.5% (1997 est.)

GDP—per capita: purchasing power parity—$4 000 (1997 est.)

GDP—composition by sector:
agriculture: 12%
industry: 50%
services: 38% (1995 est.)

Inflation rate—consumer price index: 7% (1997 est.)

Labor force:
total: 7.8 million (1996 est.)
by occupation: government 29.5% agriculture 22% construction and public works 16.2% industry 13.6% commerce and services 13.5% transportation and communication 5.2% (1989)

Unemployment rate: 28% (1997 est.)

Budget:
revenues: $13.7 billion
expenditures: $13.1 billion including capital expenditures of $5.1 million (1996 est.)

Industries: petroleum natural gas light industries mining electrical petrochemical food processing

Industrial production growth rate: NA%

Electricity—capacity: 6.007 million kW (1995)

Electricity—production: 19.1 billion kWh (1995)

Electricity—consumption per capita: 630 kWh (1995)

Agriculture—products: wheat barley oats grapes olives citrus fruits; sheep cattle

Exports:
total value: $13.1 billion (f.o.b. 1997 est.)
commodities: petroleum and natural gas 97%
partners: Italy 18.8% US 14.8% France 11.8% Spain 8% Germany 7.9% (1995 est.)

Imports:
total value: $10 billion (f.o.b. 1997 est.)
commodities: capital goods food and beverages consumer goods
partners: France 29% Spain 10.5% Italy 8.2% US 8% Germany 5.6% (1995 est.)

Debt—external: $33 billion (1997 est.)

Economic aid:
recipient: ODA $420 million (1996)

Currency: 1 Algerian dinar (DA) = 100 centimes

Exchange rates: Algerian dinars (DA) per US$1—58.969 (January 1998) 57.707 (1997) 54.749 (1996) 47.663 (1995) 35.059 (1994) 23.345 (1993)

Fiscal year: calendar year