Algerian presidency announced on Tuesday evening the preparation of a supplementary budget to manage the collapse of oil prices in a country which economy depends almost entirely on the export of fuel.
In a statement published by the Algerian News Agency, the presidency said: “President of the Republic Abdelmajid Tebboune chaired today a working meeting devoted to assessing the country’s economic situation in the wake of the sharp collapse of oil barrel prices in international markets, due to the slowdown in the global economy as a result of the spread of the Coronavirus, and the unilateral decision that some of the member states of the Organization of Petroleum Exporting Countries (OPEC) have taken to sell their crude oil production at very sharp cuts.”
The meeting was attended by PM Abdelaziz Djerad and the ministers of finance, energy, industry, Energy and Mining, agriculture and trade in addition to the governor of the Central Bank.
According to the statement, Tebboune instructed, the Minister of Finance to submit as soon as possible a supplementary budget to “include measures that would address the financial effects of the current crisis, and the collection of taxes and unpaid customs duties.”
The Minister of Finance was also tasked with “accelerating the process of establishing private Islamic banks,” stressing Algeria’s categorical refusal to “resort to borrowing” from abroad.
Instructions were also given to the Governor of the Central Bank of Algeria to supervise the ongoing endeavour to revive economic activity. On the other hand, the Minister of Finance was instructed to “ensure that the loans granted by banks within the framework of private investments are repaid.”
On Monday, oil prices fell by more than 30 percent in international markets as a result of a price war that Saudi Arabia launched against Russia after oil-producing states failed to reach an agreement to continue cutting production.
The OPEC and Russia, the organization’s leading partner in the OPEC+ production alliance, have been negotiating the additional reduction to put an end to the price drop, which reached its lowest levels in four years, in light of the spread of the novel Coronavirus.
On Monday, oil prices recorded the most significant one-day drop in three decades, with Brent crude dropping to $ 33 a barrel, before rising slightly in the past hours.