Housing: A New Strategy Is Taking Shape in Algeria

November 8th, 2012

By Riyad Hamadi

The Government’s new housing strategy is taking shape. After a massive social housing construction work done mainly by Chinese companies,Algeriais aiming at the diversification of its partnerships and wishes to speed up the rate of implementation. An agreement signed with Portugal end October 2012 is a good summary of this strategy: to build partnerships between the companies of the two countries based on the 51/49 rule; a housing quota to be achieved through the OTC market (which becomes possible owing to the presence of an Algerian associate); to have production facilities transferred to Algeria; and to have Algerians trained in the construction business.

Speeding up the rate of implementation

Another new point is related to the implementation rates. Portuguese companies will implement a first programme for building 50,000 luxury homes in Sidi Abdellah and Bouinane. They will be entrusted with integrated projects: housing estates of an average size of 5,000 homes with schools, post offices, police quarters, pharmacies etc. According to a source close to the negotiations, the first construction sites will be launched as soon as next 15 January. The same formula will be proposed toSpain,France, andItaly.

“The action is undertaken on the political level and involves the governments of the countries to which companies belong. We do not negotiate directly with businesses”, the same source says.

According to the Government’s action plan, a 100,000 housing quota is reserved for foreign companies. Local construction capacity is between 80,000 and 83,000 homes per year, while annual demand amounts to 225,000 units. As Mr Abdelmadjid Tebboune, Minister of Habitat said, local construction capacity should increase to 150,000 homes by the end of the five-year programme and then double progressively over the following years. This will make it possible to shorten the period between filing an application and home acquisition by 6 months.