The Federation of German Industries (BDI) has recommended that the German government throw its weight behind the African Continental Free Trade ... Area (AfCFTA) Agreement, arguing the continent is pivotal in efforts to diversify markets.
Has Algeria’s President Abdelmadjid Tebboune finally found a hidden gem to run the benighted ministry of finance?
The instability in the post of Minister of Finance – three incumbents in three years – has been high since Tebboune’s arrival in power in December 2019. By officially installing Brahim Djamel Kassali (67) on 14 July, the Algerian head of state entrusted the post to a leader with a profile that is more complex than it appears. In a career spanning forty years, Kassali has helped the Algerian state resolve a major debt crisis… and helped transform the country’s financial industry.
Secretary General of the Ministry of Finance since June 2020 before being co-opted into the government, Brahim Djamel Kassali inherits a strategic but exposed portfolio in a particularly difficult period. Inflation is expected to average 7.7% this year, while the annual public deficit is dangerously close to 12% of GDP, according to the IMF.
In this context, a vast and nebulous “Government Action Plan” was launched at the end of 2021. In addition to the deployment of Algerian banks abroad and the revision of laws on investment and insurance, it also provides for the revitalization of the Algiers Stock Exchange and the development of Islamic finance…
What is the profile of the man to whom the management of this major project falls?
Brahim Djamel Kassali was born in Paris on 11 November 1954, ten days after the “Red All Saints Day”, a series of attacks carried out in Algeria by the National Liberation Front (FLN), which marked the beginning of the war of independence. From his years in Paris, the sixty-year-old has retained a hint of an accent that can still be detected today.
Was his vocation for finance born in the French capital? The Lycée Jean Lurçat, in the 13th arrondissement, where he studied between 1970 and 1973, is located opposite the… rue du Banquier, which is now ensconced between two branches of the bancassurance company Crédit Mutuel.
His sober profile at the time contrasts with that of his classmates. After graduating with a G3 technological baccalaureate (commercial techniques), he went to Algeria where he obtained a degree in Financial Sciences at the University of Algiers in 1977. The economics department was headed at the time by Professor Abdelatif Benachenhou, the future Minister of Finance. Three years later, Brahim Djamel Kassali was appointed Treasury Inspector in the Ministry of Finance. He spent the next twenty-five years there.
Fiery years at the Ministry
Like the overwhelming majority of his predecessors – with the exception of Abdelatif Benachenhou – Algeria’s new finance minister learned his trade in the upper echelons of the financial administration (Inspectorate of Finance, Budget, Treasury or Customs). His first fifteen years at the ministry coincided with a spectacular increase in the public debt, which passed the 100% of GDP mark in 1994. These years were marked by the decline in the price of oil, but also by the violent conflict between the state and several Islamist groups from 1991. Algiers was forced to sign an agreement with the IMF in March 1994 and reschedule $32bn of foreign debt.
It was in the middle of this decade that Brahim Djamel Kassali was promoted to director of loans and commitments of the state, in other words, general supervisor of cash inflows and outflows of a country itself closely monitored by international creditors. He remained in this strategic position between 1995 and 2003, years during which a heavy structural adjustment programme coupled with the rise in oil prices allowed the country to replenish its coffers. A few years later, in 2006, Algiers paid off its debts to the Paris Club ($8bn) and promised never again to be under the thumb of the IMF and foreign creditors. In the meantime, Brahim Djamel Kassali has already started the second part of his career.
A model and atypical leader
Married and father of three, the man recalled to the Ministry of Finance in mid-2020 returned with an experience quite different from that accumulated by his predecessors. Certainly, after a period in the administration, several of them had directed big public enterprises. This is the case, among others, of Mohamed Loukal, long at the head of the External Bank of Algeria, and Mohammed Djellab (Crédit populaire d’Algérie – CPA). The new minister is, however, the only one to have managed a major insurance company during a period of major modernisation of the industry.
Between 2005 and 2020, Brahim Djamel Kassali was at the helm of the Algerian Insurance and Reinsurance Company (CAAR), the oldest in the country and the third in terms of annual written premiums with about 12% of market share, behind the National Insurance Company (SAA; 22%) and the Algerian Insurance Company (CAAT; 18%). In fifteen years, he has more than tripled CAAR’s revenues from 3.9 billion dinars in 2004, before he took office, to 14.8 billion (91 million euros) in 2020. The cumulative net profit during this period exceeds ten billion dinars.
For several years, he also presided over the Algerian Union of Insurance and Reinsurance Companies (UAR) and had to negotiate the delicate separation of non-life and life insurance activities, which his colleagues finally accepted with some gnashing of teeth. This was agreed in 2011 and Caarama Assurance, a life subsidiary of CAAR, was launched in July of the same year with a capital of 1 billion dinars.
The head of CAAR is also mobilizing his colleagues – and competitors – forwards in innovation and reform. He formed an alliance with SAA and CAAT to fight against fraud in the field of insurance. A partnership in bancassurance was formed with Crédit populaire d’Algérie in 2009, then with the Banque nationale d’Algérie in 2010. The alliance with CPA was strengthened in 2019 by the transfer to the public banking group of part of the capital of Caarama, worth 150 million dinars. In 2015, the two partners signed an agreement for the electronic payment of insurance premiums.
Also in the digital field, in 2019, CAAR started the remote sale and online quotation of its insurance product against natural catastrophes. Finally, it should be noted that when Brahim Djamel Kassali left for the Ministry of Finance, two of the five regional branch managers and nine of the seventeen department managers were women. This is a much higher average than that of competitors such as SAA…
Channels of discussion
In his new position, Brahim Djamel Kassali will have a front row seat to push forward a project that has been close to his heart for years: the updating of the insurance law, whose last significant reform dates back to 1995. The professionals of the sector have been complaining for many years about the slowness of the executive to increase the number of compulsory insurance – beyond the field of motor vehicles – to boost the sector.
If the former president of the professional association hoped to see this reform adopted fairly quickly during the second half of the last decade, he avoided imposing an arm wrestle with the authorities. Instead, he mobilised his colleagues to participate in the “National Loan for Economic Growth”, launched in April 2016.
“In the space of two months, we subscribed for an amount of about 15 billion dinars,” he said with satisfaction in June 2016. It should be noted that for years, Brahim Djamel Kassali has sat statutorily as the boss of insurers on the board of directors of the Motor Guarantee Fund, alongside representatives of half a dozen ministries including those of Trade, Justice, Transport and Finance.
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