Free trade zones and economic diversification in Algeria: A promising strategic direction toward African integration and sustainable development

Abstract

Within the framework of the new economic model adopted by the "New Algeria," which is based on diversifying the national economy and sources of income while striving to increase the volume and value of non-hydrocarbon exports, Algeria has introduced numerous laws, regulations, and reforms. These include the new Investment Law, the Banking and Monetary Law, and the Public Procurement Law, among others, all aimed at facilitating the integration of economic operators into this new economic direction, which seeks to gradually reduce reliance on hydrocarbons. One of the most significant reforms and new economic orientations is the draft law on free zones, established by Law No. 15-22 of July 20, 2022, which sets the rules governing free zones. Through this study, we aim to highlight the opportunities and potential Algeria possesses, which could enable the formation of a diversified economic system. We advocate for a realistic and effective strategy to find viable solutions to break away from oil dependency and achieve sustainable development within the framework of a transit economy. The competent authorities seek to encourage and facilitate trade exchanges across border crossings, especially given Algeria's extensive borders with several African countries, such as Tunisia, Mali, Niger, and Mauritania. In conclusion, we found that free trade zones are among the most effective and urgent solutions proposed today to overcome the rentier economy and dependency on a single resource. Moreover, it is essential to adopt an economic diversification strategy as an integrated approach that fully respects the principle of sustainability in its true and comprehensive sense, enabling the establishment of a balanced and integrated economic system.