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In the midst of the oil boom in the mid-2000s, #Algeria was making a LOT of money.
Sonatrach's 2008 revenue was US$76 billion.
US$76 billion...
2/10
Sonatrach's 2008 revenue was US$76 billion.
US$76 billion...
2/10
There was a lot of pressure on #Algeria to create a sovereign wealth fund (SWF.)
Everyone was doing it. Saudi. Libya. UAE. Etc.
You could take your oil and gas receipts, invest them in diversified assets, and double, triple, quadruple their value!
3/10
Everyone was doing it. Saudi. Libya. UAE. Etc.
You could take your oil and gas receipts, invest them in diversified assets, and double, triple, quadruple their value!
3/10
But not #Algeria.
In part, Algeria is hyper risk averse.
Investments that aren't a guarantee? No, thank you.
And in part, Algeria would never trust a foreign entity to handle its money.
And in part, Algeria probably couldn't figure out how to set up an SWF anyway.
4/10
In part, Algeria is hyper risk averse.
Investments that aren't a guarantee? No, thank you.
And in part, Algeria would never trust a foreign entity to handle its money.
And in part, Algeria probably couldn't figure out how to set up an SWF anyway.
4/10
And then the 2008 financial crisis hit.
Hard.
SWFs were hemorrhaging money.
But #Algeria was sitting pretty.
Its unwillingness/inability to create an SWF meant that it was decoupled from global financial markets.
Its piles and piles of cash were safe.
5/10
Hard.
SWFs were hemorrhaging money.
But #Algeria was sitting pretty.
Its unwillingness/inability to create an SWF meant that it was decoupled from global financial markets.
Its piles and piles of cash were safe.
5/10
Fast-forward to the 2020s and everyone and his brother in North Africa is doing renewables.
But #Algeria lags far far behind #Morocco and #Tunisia.
The latter two are scooping up the lion's share of foreign investment in renewables.
6/9
But #Algeria lags far far behind #Morocco and #Tunisia.
The latter two are scooping up the lion's share of foreign investment in renewables.
6/9
#Algeria on the other hand is a virtual renewable energy investment desert.
(Sorry.)
Nothing is happening.
7/10
(Sorry.)
Nothing is happening.
7/10
But hang on, now. Not so fast.
As this investigative article from @inkyfada shows, renewable energy projects are not all gumdrops and lollipops, especially for local populations.
8/10
inkyfada.com/en/2022/11/11/…
As this investigative article from @inkyfada shows, renewable energy projects are not all gumdrops and lollipops, especially for local populations.
8/10
inkyfada.com/en/2022/11/11/…
In fact, quite the contrary.
The projects (even the flagship ones) operate at a financial loss.
And they deplete local resources, endangering the well-being and livelihoods of local communities.
9/10
The projects (even the flagship ones) operate at a financial loss.
And they deplete local resources, endangering the well-being and livelihoods of local communities.
9/10
So, is this #Algeria's SWF redux?
Algeria was criticized for not creating an SWF, but not doing so turned out to be the right move.
And everyone is criticizing Algeria for not jumping on the renewables bandwagon.
But maybe slow-and-steady wins the race?
10/10
Algeria was criticized for not creating an SWF, but not doing so turned out to be the right move.
And everyone is criticizing Algeria for not jumping on the renewables bandwagon.
But maybe slow-and-steady wins the race?
10/10
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