Algeria embarks on procurement reforms to tackle corruption

On 11 June, Algeria’s Finance Minister Laaziz Fayed presented a draft law of the general rules governing public procurement to the Finance and Budget Committee of the Algerian People’s National Assembly.

“The aim of the bill is to provide a better framework for public procurement, taking into account the profound changes in the country’s economic situation, by consolidating production and the national production base, in particular, labelled start-ups, small businesses and micro-enterprises,” said the minister.

Among other things, the new law aims to remove physical documentation and paperwork and introduce electronic contracts. The measures are intended to “put an end to favouritism and corruption, and speed up procedures and audit operations while saving time, effort and money.”

The majority of public contracts are currently awarded by mutual agreement. Soon, this procedure “will become the exception,” said Fayed.

20% of Algeria’s GDP

In countries affiliated with the Organisation for Economic Co-operation and Development (OECD), public procurement accounts for around 12% of gross domestic product (GDP), compared with 20% in Algeria.

“Given the financial volumes involved, governments need to ensure that public funds are managed well so that they can deliver the best possible added value to their citizens,” the OECD said in a 2019 document entitled ‘Review of the public procurement system in Algeria.’

A few years later, the organisation’s recommendations appear to have been acted upon. The bill also provides for the creation of a national public procurement council to “effectively combat corruption.”

The institution will be “an independent administrative arbitration body, which will issue its opinion on disputes arising during the performance of public contracts with foreign operators through a multidisciplinary commission,” the minister said.

The text provides for the drafting of a code of ethics and deontology “intended for public officials and agents involved in the conclusion, execution and control of public contracts.” This should encourage foreign investors to consider Algiers.