Algiers — Algeria and the European Union (EU) have announced plans to revise their Association Agreement, which has been in effect since 2005. The revision, set to begin next year, aims to address Algeria’s concerns over trade imbalances and lack of European investment, while factoring in global “geopolitics” and the evolving international context.
Algeria’s Push for Revision
Algerian President Abdelmadjid Tebboune has been a vocal advocate for revisiting the agreement. In a recent Council of Ministers meeting, he instructed officials to review the provisions “clause by clause,” emphasizing a “sovereign vision and a win-win approach.”
President Tebboune has highlighted Algeria’s evolving economic capabilities, noting that the country has shifted from being a net importer to producing and exporting a variety of goods. “At the time the agreement was signed, Algeria lacked export capacity. Today, we are asking for a revision based on free trade principles and in a spirit of friendship,” he explained during a recent media interview.
EU’s Stance on the Revision
The EU, Algeria’s largest economic partner and primary importer of Algerian gas, has expressed openness to revising the agreement. However, the EU’s approach includes broader considerations, such as geopolitical factors and a comprehensive partnership.
“There is a geopolitical aspect to the definition of ties between the EU and its neighbors,” said Diego Mellado Pascua, the EU’s new ambassador to Algeria. He emphasized that the revision will be part of a broader pact for Mediterranean relations, aligning with the EU’s new strategy for the region.
The EU ambassador also underscored the importance of addressing trade imbalances and modernizing the agreement. “We need to find common ground to satisfy everyone,” he stated, adding that technical consultations and Algerian proposals will shape the revision process.
Key Areas of Focus
1. Trade Imbalances: Algeria has long criticized the agreement for its unfavorable trade balance, particularly in non-hydrocarbon sectors. Between 2005 and 2015, Algeria’s non-hydrocarbon exports to the EU totaled less than $14 billion, while imports reached $220 billion.
2. Energy Cooperation: Energy remains a cornerstone of EU-Algeria relations. The EU aims to strengthen collaboration in renewable energy as part of its “green pact” to reduce greenhouse gas emissions by 55% by 2035. Ambassador Mellado highlighted Algeria’s potential in this area, urging greater involvement in Europe’s renewable energy market.
3. Movement of People: The EU has suggested including discussions on the movement of people as part of the revised agreement. “The EU needs manpower, and we need to find a balance that serves both sides,” Mellado noted.
4. Customs Revenue Loss: Algeria has reported significant customs revenue losses—over 700 billion DA—due to the agreement. This has further fueled calls for a fairer deal.
Next Steps
The revision process will begin with technical consultations and expert visits. However, a planned visit by European experts was postponed due to a government reshuffle in Algeria and changes within the EU.
Both sides are committed to achieving a “win-win situation” while fostering stronger economic and diplomatic ties.
Conclusion
Trade between Algeria and the EU surpassed €50 billion in 2024, but imbalances in non-hydrocarbon sectors remain a pressing issue. As Algeria pushes for a more equitable agreement, the revision process represents an opportunity to redefine relations and address mutual challenges in trade, energy, and labor mobility.
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