Algeria passes biggest budget in history, increases defence spending

Algeria passes biggest budget in history, increases defence spending
The boost in Algeria's military spending comes amid tensions with neighbouring Morocco over Western Sahara and Rabat's ties with Israel.
2 min read
23 November, 2022
The Algerian military is among the strongest in the MENA region [Getty/archive]

Algerian lawmakers passed the country’s biggest-ever annual budget on Tuesday, which included increased defence spending.

A majority of lawmakers voted to pass the 13.786 trillion Algerian Dinar (US$99 billion) budget for 2023.

About 3.186 trillion Dinars (around US$23 billion) was allocated for the country’s military, which is one of the strongest in the Middle East and North Africa region.

That allocation is the largest for Algeria's military since the country achieved independence from France in 1962.

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The unprecedented increase in military spending comes as tensions continue between Algeria and neighbouring Morocco.

Algiers severed diplomatic relations with Rabat in August 2021 over the Western Sahara dispute and Morocco’s relations with Israel, including their military and security ties.

Movement of Society for Peace – Algeria’s main Islamist party and the largest opposition bloc in the legislature – voted against the budget over a failure to specify the source of financing, among other issues, according to Anadolu Agency.

Algeria's economy has been given a boost in recent months as European countries that have usually relied on Russian gas look elsewhere. Algiers has signed several deals with European countries to supply them with gas as Moscow contends with Western sanctions applied because of its invasion of Ukraine.

The International Monetary Fund said on Monday that high energy prices have "materially improved" the Algerian economy's near-term outlook, but added that "fiscal rebalancing is still needed to put public finances on a sound footing."

The approved budget saw an unprecedented deficit of $43 billion.

The IMF projected at the end of last year that Algeria's public debt for 2022 would stand at 65.4 percent.