Home arrow News arrow Emirati Investments  
Emirati Investments
Sunday, 27 July 2008
ImageThe United Arabs Emirates is investing in Algeria with renewed vigour, enabling petrodollars to pour in to the country of late. This view was reinforced during the sixth session of the joint Algerian-Emirati commission in Algiers last month.

UAE Economy Minister, Sheikh Soltan el Mansour, visiting Algiers with a delegation of Emirati investors, said afterwards that he expects the level of investment in Algeria to increase between 2006 and 2010. "Investment in Algeria should surpass $50bn, taking into account the value of projects during the last two years and the next three years. These projects span several sectors, such as industry, services, energy, real estate and agriculture," said el Mansour in a press briefing after the conference.

Up to now, the main targets for UAE investors have been in the construction and property sectors. EIIC (Emirates International Investment Company) began to build "Parc Dounya," a multi-billion dollar project, earlier this year.

"The need for investment in Algeria is enormous, so it was only a question of finding the right project to meet public and private demand. The 670 ha Parc Dounya will be a harmonious place, giving the capital the largest urban park in the world," Malik Si-Hassen, director general of EIIC in Algeria, told OBG.

Upon completion of the five-year project, EIIC will hand over 75% to the authorities as a "public park", with the other 25% to be set aside for private development and commercial activity.

Besides its involvement in Parc Dounya, EIIC has sought to diversify its Algerian investment portfolio, most notably investing in electrical cabling, steelworks and agriculture. A dairy farming project involving 10,000 dairy cows is in the pipeline and aims to become the largest livestock farm in Africa.

Other Emirati groups, such as Emiral and Al Qudra, have also decided to set up operations in Algeria, looking at various types of investments, particularly related to tourism.

Slated for completion by July 2010, Al Qudra's Sidi Fredj complex will cost $250m and consist of a hotel and high-end residential and commercial property on the Mediterranean coast.

"Algeria is extremely attractive for Emirati investors and is becoming more stragetically important for our group. We are planning to create tourism and commercial centres similar to those in the province of Oran and Mostaganem," Firas Al Sayegh, director of international projects at Al Qudra holding, told OBG.

Among the Emirati companies investing in Algeria in 2008 is Emaar, with three projects. These include the new town of Sidi Abdellah, intended as a knowledge and technology centre on the outskirts of Algiers; Staouéli health resort; and the Corniche de Colonel Abbès tourist resort. These projects have yet to get off the drawing board, however.

An ambitious project to redevelop the Baie d'Alger area, also under the aegis of Emaar, is currently being discussed with the Algerian government. According to Emirati authorities, the issue of real estate regulation hinders investment projects in the country.

"Emaar is looking, along with the authorities, to reduce obstacles that stand in the way of investment projects in Algeria," said the country's Finance Minister, Karim Djoudi. "It is up to us to identify the constraints before we act," he added.

Although Emirati investors are complaining about the constraints of Algerian bureaucracy, they continue to want to invest in new branches of activity.

After tourism and real estate, industry is becoming the most important sector for potential investors. Dubai-Mubadala, also known as Emal International, said that it would build a $7.5bn aluminium plant geared to produce 750,000 tonnes of the metal by 2013.

"The Beni Saf aluminium project has the potential to become the biggest direct foreign investment in Algerian history," Guy de Grandpré, director of Emal International Algeria, told OBG.

"However, it won't be judged solely on the economic contribution it makes. It will also be judged by the impact it has on the lives and environment of the people in the areas concerned," he added. The particular aim of this project is to develop a modern aluminium industry which will create 2500 direct jobs and 7500 indirect jobs in the long term in the Wilaya of Ain Témouchent.

Trade between Algeria and the UAE reached $444m in 2007, making the UAE the fourth largest foreign investor in Algeria. Yet the figure remains below Emirati expectations. The UAE's delegation bemoaned the lack of vision and pragmatism of the Algerian authorities and stressed that the business climate in Algeria could be more attractive for investors.

Minister Djoudi, for his part, called on UAE companies to keep to their investment promises in Algeria. He was also pleased to announce that the Algerian debt to the UAE, estimated to be $333 bn, will be paid back in the form of direct investments, and that the Emirates were currently examining the possibility of creating an Algerian investment fund, experimental farms as well as investing in new ports.
 
Latest News