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The surroundings of the Ferhat-Boussaad market are always full. A pouring rain may have sprinkled Algiers for several days, the attendance of this shopping street in the city center remains strong. Shoppers crowd the sidewalks, as cars try to make their way through a hubbub of horns. A usual scene. What is not, are the prices displayed on the stalls of traders.
” Rising prices ? You have to look at the wholesale markets. It is the intermediaries who pull the tariffs upwards to the detriment of farmers and consumers ”, justifies himself a seller of fruits and vegetables. Some staple foods now sell for double or even triple their usual price. Thus, the price of the kilo of potatoes, which reached 130 dinars (0,82 euro) against around 60 usually, has become the main indicator to denounce the increase in the cost of living in Algeria.
In an attempt to regulate this “potato crisis”, as some have dubbed it, the government launched direct sales operations to consumers, at a fixed price of 50 dinars per kilo, and raised the possibility of an exceptional remedy. to imports.
The authorities regularly denounce the action of speculators in the agrifood sector, aiming without distinction between intermediaries, farmers and wholesalers, accused of stocking food to drive up prices. A bill currently under discussion even aims to criminalize speculation, with sentences of up to thirty years in prison “If the crime concerns basic products such as cereals, milk, oil, sugar and legumes”.
In any case, the rise in prices is beginning to weigh on household stock markets. In the country, inflation reached 5.66% in June, an increase of 3.4 points in one year, told MEPs Aïmene Benabderrahmane, Minister of Finance and Head of Government. Consumer prices started to rise again due to the increase in international commodity prices, but also to the depreciation of the dinar.
“We entered into an economic crisis in 2018, with the freezing of large public infrastructure projects that made small and large companies work, recalls economist Smaïl Lalmas. The Covid-19 epidemic did the rest. Today, the country is experiencing huge job losses. All sectors have been affected. All this was accompanied by a rise in prices and the lifting of public subsidies on certain products, notably fuel, which affected purchasing power. “
Trade unions and consumer associations have called on the government to increase wages. In the public service, salaries have been frozen since 2010, while the prices of food and energy have continued to increase, denounced in September Mustapha Zebdi, president of the Algerian Association for the Protection and Guidance of the consumer and his environment (Apoce).
For several months, the social boom has been real and several sectors, including education and health, threaten to go on strike. Teachers, mainly those in primary, middle and secondary cycles, have already been observing two-day-a-week strikes since early November. “This movement was followed by more than 78% of teachers at the national level, with peaks of 90% of strikers in the secondary”, underlines Messaoud Boudiba, spokesperson for the National Autonomous Council of Secondary and Technical Education Teachers (Cnapest).
The union maintains the pressure to voice its demands on wages, pensions and access to housing. A teacher is paid on average 40,000 dinars (250 euros) “While the minimum wage should not be below 80,000 dinars for a family of five”, continues Messaoud Boudiba.
Abolition of subsidies
As part of the new 2022 finance law, the government plans to reduce the tax burden on households with a reduction in the overall income tax and an increase in the salary calculation index in the civil service, which has 2.1 million employees.
“These are insufficient measures, which will not have any influence on the current situation, estimates economist Smaïl Lalmas. We expected a war economy program, for the simple reason that millions of jobs would have to be created, but this finance law does not activate any of the four growth engines: public spending, consumption of households through the protection of purchasing power, exports and investment. “
Another thorny point raised by the bill: the abolition of the system of generalized subsidies – the State finances basic food products and energy -, estimated at 17 billion dollars per year (about 15 billion euros) by the government. Ministry of Finance. The authorities want to reform this policy of social transfers by allowing it to benefit exclusively the “Low and middle income households”.
But the task promises to be difficult. “From the moment we have an economy crushed by the informal sector, how to set up a targeted aid system?, asks Smaïl Lalmas. What is urgent is to absorb the informal, to convince it to enter the formal circuit. But for that, there is one factor that is lacking: trust. “
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In Algeria, the government tries to regulate the “potato crisis”