ANNOUNCED AS TEMPORARYNo
FDI: Entry and ownership rule
The President of Algeria has announced a series of measures giving preferential treatment to local firms over foreign ones, competing for a share of the US$286billion five-year investment plan (2010-2014). The plan is intended to contribute to efforts to diversify the Algerian economy away from its dependency on oil, promote human development and strengthen infrastructure. The measures however do not apply to the energy sector and are intended to develop the capacity and quality of services of local firms and create employment for the youth.
Specific measures favouring the domestic firms are:
i) Theincrease from 15% to 25% of the maximum margin of preference accordedto the local company whose capital is mostly domestic, as well as localproducts and services, in the bidding for public contracts.
ii)All contracts must be put to a national tender but only Algerian firms are eligible to participate. Ifthat fails or no local firms win the tender, foreign firms will be invited to bid.
Also, for international tenders, there must be a commitment by the foreign firm to enter into an investment partnership with an Algerian company.
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