Algerian banks apply the unblocking with Spain

Little by little the mist that has covered the future of trade relations between Spain and Algeria during the past week is dispersing.

Despite a statement from the Algerian Ministry of Foreign Affairs that seemed to disavow the thaw of financial transactions ordered by the banking bosses last Thursday, most of the financial entities that operate in the Maghreb country are already working normally with their counterparts Spanish.

However, there is still some confusion at customs, as some goods from Spain have been able to go through the procedures and be distributed to their customers, while others continue to be blocked.

"Many banks are already working as normal on transactions with Spain, and we hope that the rest will do so in the coming days," says Jamal-Eddin Bou Abdallah, president of the Algerian-Spanish Circle of Commerce and Industry (CCIAE).

He considers this situation logical after the circular that the Association of Banks and Financial Establishments of Algeria (ABEF) sent to its members to re-establish direct debits between the two countries, a measure that had suffocated bilateral trade.

“ABEF made its decision based on instructions from the Ministry of Finance.

And, since then, no official notification has invalidated it.

So it is still valid”, adds Bou Abdallah.

Uncertainty and concern once again took hold of Spanish companies when a note was released from the official Algerian news agency APS in which, citing a Foreign Ministry statement, it was warned that the Algerian Government had not "backed down" in its relations with Spain.

In addition, he stated that the ABEF did not have the power to make decisions that affected the country's sovereignty.

In the note it was not clear whether the Algerian authorities disassociated themselves from the latest ABEF circular, and bilateral trade should continue to be frozen, or from the first circular.

“I believe that the note from the APS should be interpreted as a message that political relations with Spain have not normalized, but economic relations have,” says Bou Abdallah.

Several Spanish companies have confirmed to EL PAÍS that financial flows between the two countries have recovered their usual rhythm.

However, this is not the case for goods.

“We had a pending bank transfer, and it has already been made.

We were also able to get a piece of merchandise out of the port.

But today I was informed that there is no way to receive clearance from airport customs.

This is an ordeal”, confesses the head of a company in the construction sector who prefers to remain anonymous.

“The banks tell us that they do not have any instructions to block and that, therefore, we can operate with peace of mind.

Customs tell us the same thing, but no one puts it in writing,” summarizes Job Pero, CEO of PMS International, a chemical exporting company.

Despite this apparent normality, Algerian clients who trade with the company and who have consulted their respective banks have been advised not to do anything for the time being until the situation is clarified.

Prudence continues to prevail in every move.

In fact, some Spanish companies consulted by EL PAÍS that had circumvented the blockade, redirecting their shipments through third countries of the European Union, have decided to maintain this strategy.

According to Bou Abdallah, the contradictions experienced in customs are explained by the slowness in getting the new information to all the links in the chain.

“Speaking with various people involved here, including from the Administration, the prevailing opinion is that the Algerian government is willing to normalize trade relations.

The problem is that we are in full vacation, and many managers are not in their posts," says the head of the CCIAE, who estimates that Algex, the agency that manages customs procedures, will already operate normally by mid-August.

Algerian companies that import Spanish products have complained about the discrimination represented by the exception made to the natural gas sector, since their bank transfers were never frozen, and the fuel continued to flow through the gas pipelines.

Gas represents practically the entire volume of Spanish imports from Algeria, which in 2020 exceeded 2,500 million euros.

“We have been in lockdown for a month and a half;

if we got to three months it would be a disaster.

It is not easy to change suppliers in such a short time.

For example, 70% of the chicken consumed in Algeria comes from Spain.

We are already noticing an inflation that, by contagion, affects other meats”, adds Bou Abdallah.

Spanish exports to the country totaled almost 3,000 million euros in 2019 - the last reference year for not being affected by the coronavirus pandemic -, 1% of all foreign trade.

Among the most exposed sectors are semi-manufacturing (more than 1,100 million euros) and metallurgy and automotive (605 million and 460 million, respectively), according to the Secretary of State for Trade.

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