Tuesday, November 28,2017
Algeria’s lower house of parliament approved increases in subsidized gasoline and diesel prices for the third straight year as part of the 2018 budget, amid government attempts to compensate for a sharp fall in oil and gas revenues, Reuters reported. The budget also includes higher and new taxes on some imported and local products in a bid to diversify funding away from oil and gas exports. The budget calls for a 25% rise in spending after two years of cuts. In order to cover the extra expenditure the government has amended a law to allow the central bank to lend directly to the public treasury. Oil and gas revenues account for 95% of the OPEC member’s exports and 60% of the state budget. State finances have been hit since crude oil prices first fell in mid-2014, forcing the government to cut spending on some subsidized goods and seek new financing alternatives. Algeria has announced plans to reform its subsidy system, which covers almost everything from basic foodstuffs and drugs to energy.