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Concerns among Spanish businesspeople over uncertain trade normalization with Algeria

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Two days after the Algerian government issued a statement disavowing its banking employers about allowing financial transactions with Spain, uncertainty has subsided among Spanish companies and institutions with interests in the Maghreb country. Some of the containers from Spain that have been stranded in Algerian ports for weeks have survived all customs procedures, while other companies have not moved in the last few days. The Algerian authorities have not made any public clarification, so the Algerian media also reflected their confusion about the current and future state of trade relations with Spain.

“The information that we have received from the companies involved in the Spanish-Algerian trade says that the difficulties are still ongoing. We hope that this can be resolved as soon as possible, but we don’t know when that will be,” said Hana Bouarab, head of the commercial service of the Algerian-Spanish Circle of Commerce and Industry. Spanish diplomatic sources describe a similar scenario, using words like “uncertainty” and “caution” to describe the climate between the economic actors of both countries in the last few hours.

Last Thursday, the Association of Banks and Financial Institutions of Algeria (ABEF) sent a circular to its members ordering an end to the freeze on direct debits between the two countries, which began on April 8. In addition, Spanish companies saw how their goods are not the Customs inspectors allowed them to leave Algerian ports. Two days later, on Saturday afternoon, however, a statement from Algeria’s foreign ministry denied any reversal in ties with Spain, stating that the ABEF could not make “sovereign” decisions equivalent to the Council of Ministers.

The Algerian electronic newspaper TSA, one of the most widely read, didn’t know how to interpret the latest statement from the Algerian Ministry of Foreign Affairs. “Is there no going back from the state because the trade freeze is in place or because there never was one?” asked the newspaper, finally concluding that “all readings are possible”.

Confusion and caution also reign among Spanish businessmen doing business in the African country. “We contrast all the messages that reach us and wait to see whether commercial activity will be allowed,” says Manuel Breva, secretary general of Anffecc, the employers’ association of enamel manufacturers. “It creates a lot of uncertainty that the government contradicts the previous information from one day to the next. You have to be careful there,” he admits with concern. Algeria is the second most important destination country for its products after Italy. They calculate that this two-month break caused damage of between 25 and 30 million euros.

Due to the information provided by the Spanish diplomats that “the communication channels with Algeria are broken”, the feeling is spreading to other sectors. Job Pero, general secretary of chemicals exporter PMS International, is not entirely surprised, but he is “out of place”. “We got to work and the Algerian banks tell us that they have orders to unlock everything. In principle, we can home products of Spanish origin,” he says. The main reason the entities give is that they have not received any official statement from the Algerian government, everything is flowing through the press. Just as the executive branch distanced itself from the bosses’ blockade last June, it now distances itself from lifting it.

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In his company, they could theoretically release two of the containers that were paralyzed in the Algerian port for reasons unrelated to the blockade, since they were part of an expedition before June 9, when everything was suspended. “We understand that the intention was not to release the goods because they were angry with Spain, but we dismantled all the reasons they gave us,” says Pero. The manager of another construction company, who prefers to remain anonymous, has also resolved the problems of his goods at customs, as well as financial transactions, both carried out before June 9th.

The attitude of the banks does not guarantee that customs will do the same, and all this contributes to raising doubts. In Pero’s company, they have another immobilized expedition. “You have to see how the specific people who receive the dossiers behave. It’s all very ambiguous,” he admits.

For now, they will continue trading through friendly companies in Italy and Portugal to supply the product from third countries. The procedures have already started doing some operations with Spanish products, but they will wait to see if they can ship them next week. “We’d better be careful. Now the only certainty is that the ABEF is unlocked and we can operate with it, but something similar can happen again and turn the tables again. It’s a country where you have to deal with a very high level of insecurity,” he says.

Spanish exports to the country amounted to almost 3,000 million euros in 2019 – the last reference year in which it was not affected by the coronavirus pandemic – 1% of the total. According to the Ministry of Commerce, the sectors most at risk include semi-manufacturing (more than 1,100 million euros), metallurgy and the automotive industry (605 million and 460 million respectively).

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Source elpais.com

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