There are companies operating within Algeria from each of its main trading partners. This includes the countries of the US, France, Spain, Italy, Germany, Canada and Japan…
France is by far the biggest trading partner of Algeria. Over 28% of its imports come from France. The trade runs the entire gamut of the Algerian economy, as the once colonial Empire owner of Algeria invests heavily in that country even today.
In return, Algeria is one of the main suppliers to France of oil and natural gas. There are over two million native Algerians living in France today.
The United States is the second largest exporter to Algeria. The US is also heavily dependent on Algerian oil. In 1995, US oil company Anadarko entered an agreement with Algerian Sonatrach to develop oil contracts. This later also covered Amoco which along with Anadarko became a subsidiary of British Petroleum.
As a group, the European Union, which includes France, is the largest trading partner of Algeria. About two-thirds of Algerian exports are absorbed by the Union.
In December of 2001, Algeria and the European Union signed as Association Agreement under the framework of the Euromed partnership. This agreement sets a framework for the relationship in all areas of trade. This agreement actually went into force in September of 2005. There was a first evaluation of it in 2009. Bilateral trade volumes increased by 9.3% between 2003 and 2009. This was principally due to increased oil exports by Algeria. In 2009, 98% of Europe’s imports from Algeria being in the form of oil and natural gas, Algeria ranked as the European Unions’ fifth larger supplier of energy. Algeria is among the biggest European Union trading partners in the Mediterranean area.
As it is, European exports to Algeria in 2009 were 14.6 billion Euros, compared to imports from Algeria of 17.3 billion Euros. Main imports of Algeria from the EU consist of machinery and transport equipment, followed by agricultural products, iron and steel and chemicals.
As part of the Euromed agreement, Algeria and the EU have the common goal of creating new trade with countries around the Mediterranean rim. This region has the lowest level of regional trade of any other region in the world. The Pan-Euro-Mediterranean system developed in September of 2007 will allow producers to export in more than one Euromed country without losing preferential tariff rates with other EU markets. This agreement is fully supported by Algeria.
Algeria is presently in the process of accession to the World Trade Organization. They have strong support from the European Union. Negotiations for this started in 1998. Should this come to fruition, Algeria can expect a much wider variety of trading partners.