Algeria, Turkey Sign Investment Promotion MOU Targeting Enhanced Cooperation
Image: Echorouk
Takeaway
The MOU between Algeria and Turkey signals a strategic shift in Algeria's investment landscape, potentially favoring Turkish companies over traditional European investors. International fund managers should re-evaluate their North African portfolios, considering increased exposure to Turkish firms with Algerian operations. The focus on steel, plastics, and renewable energy presents actionable opportunities for investors in these sectors.
The Algerian Agency for Investment Promotion (AAPI) and the Investment and Finance Office of the Presidency of the Republic of Turkey signed a memorandum of understanding (MOU) on May 8, 2026, aimed at bolstering investment cooperation between the two countries. The agreement was formalized during a ceremony attended by Algerian President Abdelmadjid Tebboune, coinciding with the Algerian-Turkish High-Level Strategic Cooperation Council meeting. Omar Rekkache, Director General of AAPI, and Ahmet Burak Dağlıoğlu, President of the Turkish Investment and Finance Office, signed the MOU.
Algeria and Turkey have been steadily strengthening their economic and political ties in recent years. In early 2024, the two nations set a bilateral trade target of $10 billion, initiating discussions for a preferential trade agreement to facilitate increased commerce. This target was reiterated during the inaugural Algerian-Turkish High-Level Cooperation Council held in Ankara in 2024, where several economic agreements were signed. These agreements built upon earlier collaborations, such as the 2023 agreement to enhance cooperation in the energy sector, demonstrating a sustained commitment to deepening bilateral relations.
The MOU aims to streamline investment processes and provide greater support for Turkish companies looking to invest in Algeria, and vice versa. Specific sectors of focus were not detailed in the initial announcements, but given Algeria's prioritization of sectors like steel and plastics for its automotive industry, these areas, along with renewable energy, are likely to be of significant interest. Tosyali Algeria, for example, has already begun supplying premium steel to the domestic automotive and appliance industries, reducing reliance on imports. Algeria's broader digital transformation project, targeting completion by 2030, also presents opportunities for Turkish technology firms.
The enhanced investment cooperation is expected to benefit Turkish companies seeking to expand their footprint in North Africa, providing them with preferential access and support within the Algerian market. Algerian firms, in turn, could gain access to Turkish technology and expertise, particularly in sectors where Turkey has a competitive advantage. This partnership could potentially reduce Algeria's reliance on traditional European partners, such as France, which has seen its investment position in Algeria face challenges. The deepening ties could also impact trade flows within the region, potentially diverting investment and trade away from other North African nations.
Looking ahead, the implementation of the MOU will be crucial in determining its effectiveness. The specific mechanisms for facilitating investment and resolving potential disputes will need to be clearly defined. The next meeting of the Algerian-Turkish High-Level Cooperation Council, expected in 2027, will provide an opportunity to assess progress and identify further areas for collaboration. Any shifts in Algerian government policy or Turkish economic conditions could also impact the trajectory of this partnership. The $10 billion trade target will serve as a key benchmark for measuring the success of these initiatives.