Ministers Delegate
Minister Delegate in Charge of Maghrebian and African Affairs--Abdelkader Messahel
Minister Delegate in Charge of the Family and Women's Affairs--Nouara Saadia Djaafar
Minister Delegate in Charge of Local Collectives--Daho Ould Kablia
Minister Delegate in Charge of Rural Development--Rachid Benaissa
Minister Delegate in Charge of Scientific Research--Souad Bendjaballah
Minister Delegate in Charge of Town Planning & Environment--Abderrachid Boukerzaza
Minister Delegate in Charge of Financial Reform--Fatiha Mentouri

Other Government Officials
Secretary General of the Government--Ahmed Noui
Speaker of the National People's Assembly (Lower House)--Amar Saadani
Speaker of the Council of the Nation (Upper House)--Abdelkader Bensalah
Governor, Central Bank--Mohamed Laksaci
Ambassador to the United States--Amine Kherbi
Permanent Representative to the United Nations, New York--Youcef Yousfi

POLITICAL CONDITIONS
Terrorist violence in Algeria resulted in more than 100,000 deaths during the 1990s. Although the security situation in the country has improved, addressing the underlying issues that brought about the political turmoil of the 1990s remains the government's major task. President Bouteflika implemented the Charter on Peace and National Reconciliation on March 1, 2006, as one way to bring closure. Thus far, it has successfully gained the surrender of a number of moderate Islamists, but paradoxically, has emboldened the more hard-core elements, in particular the Salafist Group for Preaching and Combat (GSPC), which changed its name in January 2007 to Al-Qaida in the Islamic Maghreb (AQIM).

In keeping with its amended Constitution, the Algerian Government espouses participatory democracy and free-market competition. The government has stated that it will continue to open the political process and encourage the creation of political institutions. Presidential elections took place in April 2004 and returned President Bouteflika to office with 84.99% of the vote. The next presidential elections are scheduled for 2009.

Algeria has more than 45 daily newspapers published in French and Arabic, with a total circulation of more than 1.5 million copies. There are 20 domestically printed weekly publications with total circulation of 622,000 and 11 monthly publications with total circulation of 600,000. In 2001, the government amended the Penal Code provisions relating to defamation and slander, a step widely viewed as an effort to rein in the press. While the Algerian press is relatively free to write as they choose, use of the defamation laws significantly increased the level of press harassment following President Bouteflika's April 2004 re-election victory, and as a result, the press began to self-censor. In July 2006, President Bouteflika pardoned all journalists convicted of defaming or insulting state institutions. The pardon effectively dismissed the charges against 67 people. Critics point out that according to the criminal code, insulting the president is punishable by prison sentence. Nevertheless, the pardon was widely seen as a significant step toward democracy. The government holds a monopoly over broadcast media; Algerian newspapers are widely seen to be the freest in the region.

Population growth and associated problems--unemployment and underemployment, inability of social services to keep pace with rapid urban migration, inadequate industrial management and productivity, a decaying infrastructure--continue to affect Algerian society. Increases in the production and prices of oil and gas over the past decade have led to exchange reserves reaching $80 billion. The government began an economic reform program in 1994, focusing on macroeconomic stability and structural reform. These reforms aimed at liberalizing the economy, making Algeria competitive in the global market, and meeting the needs of the Algerian people. In 2004, the government announced a $55 billion spending program to improve national infrastructure and social services; subsequent announcements have increased the proposed program to $120 billion.

ECONOMY
The hydrocarbons sector is the backbone of the Algerian economy, accounting for roughly 60% of budget revenues, nearly 30% of GDP, and over 97% of export earnings. Algeria has the ninth-largest reserves of natural gas in the world (2.7% of proven world total) and is the fourth-largest gas exporter; it ranks 14th for oil reserves (2006). Its key oil and gas customers are Italy, Germany, France, the Netherlands, Spain, the United Kingdom, and the United States. U.S. companies have played a major role in developing Algeria's oil and gas sector; of the $5.3 billion (on a historical-cost basis, according to statistics gathered by the U.S. Department of Commerce, Bureau of Economic Analysis) of U.S. investment in Algeria, the vast bulk is in the petroleum sector.

Faced with declining oil revenues and high-debt interest payments at the beginning of the 1990s, Algeria implemented a stringent macroeconomic stabilization program and rescheduled its $7.9 billion Paris Club debt in the mid-1990s. The macroeconomic program has been particularly successful at narrowing the budget deficit and at reducing inflation from of near-30% averages in the mid 1990s to almost single digits in 2000. Inflation was at 3.6% in 2004. Algeria's economy has grown by more than 5% in each of the past five years, posting 5.6% growth in 2006. The country's foreign debt fell from a high of $28 billion in 1999 to $5 billion in 2006; in that year Algeria paid off the last of its Paris Club debt. The spike in oil prices in 1999-2000 and 2004, the government's tight fiscal policy and conservative budgeting of oil prices from 2000 to present, a large increase in the trade surplus, and the near tripling of foreign exchange reserves have helped the country's finances.

The government pledges to continue its efforts to diversify the economy by attracting foreign and domestic investment outside the energy sector. The Algerian Government has had little success at reducing high unemployment, officially estimated at 13% in 2006, though international estimates put the figure higher, and at improving living standards.

Priority areas are banking and judicial reform, improving the investment environment, partial or complete privatization of state enterprises, and reducing government bureaucracy. The government has privatized certain sectors of the economy and embraced joint venture investment opportunities with traditionally state owned and operated entities. In 2001, Algeria concluded an Association Agreement with the European Union, which was ratified in 2005 by both Algeria and the EU and took effect in September of that same year. The government is working toward accession to the World Trade Organization.

DEFENSE
Algeria's armed forces, known collectively as the Popular National Army (ANP), total 138,000 active members, with some 100,000 reservists. The president serves as Minister of National Defense. Military forces are supplemented by a 60,000-member national gendarmerie, a rural police force, under the control of the president and a 30,000-member Sureté Nationale or Metropolitan Police force under the Ministry of the Interior. Eighteen months of national military service is compulsory for men.

Algeria is a leading military power in the region and has demonstrated remarkable success in its struggle against terrorism. The Algerian military, having fought a decade-long insurgency, has increased expenditures in an effort to modernize and return to a more traditional defense role.

Due to historical difficulties in acquiring U.S. military equipment, Algeria's primary military supplier has traditionally been Russia, and to a lesser extent China; Algeria recently made large purchases of advanced weaponry from the former. Algeria has, however, in recent years, begun to diversify its supplies of military equipment to include U.S.-made airborne surveillance aircraft and ground radars.

FOREIGN RELATIONS
Algeria has traditionally practiced an activist foreign policy and in the 1960s and 1970s was noted for its support of Third World policies and independence movements. Algerian diplomacy was instrumental in obtaining the release of U.S. hostages from Iran in 1980. Since his first election in 1999, President Bouteflika worked to restore Algeria's international reputation, traveling extensively throughout the world. In July 2001, he became the first Algerian President to visit the White House in 16 years. He has made official visits to France, South Africa, Italy, Spain, Germany, China, Japan, Portugal, Russia, the United Kingdom, and Latin American countries, among others, since his inauguration.

Algeria has taken the lead in working on issues related to the African continent. Host of the Organization of African Unity (OAU) Conference in 2000, Algeria also was key in bringing Ethiopia and Eritrea to the peace table in 2000. In 2001, the 37th summit of the OAU formally adopted the New Partnership for Africa's Development (NEPAD) to address the challenges facing the continent. Algeria has taken a lead in reviving the Union of the Arab Maghreb with its neighbors.

Since 1976, Algeria has supported the Polisario Front, which claims to represent the population of Western Sahara. Contending that the Sahrawis have a right to self-determination under the UN Charter, Algeria has provided the Polisario with support and sanctuary in refugee camps in the southwestern Algerian province of Tindouf. UN involvement in the Western Sahara includes MINURSO, a peacekeeping force, UNHCR, which handles refugee assistance and resettlement, and the World Food Program (WFP). Active diplomatic efforts to resolve the dispute under the auspices of the United Nations Secretary General are ongoing.

Algeria's support of self-determination for the Polisario is in opposition to Morocco's claim of sovereignty. The dispute remains a major obstacle to bilateral and regional cooperation. Although the land border between Morocco and Algeria was closed in the wake of a terrorist attack in 1994, the two have worked at improving relations, and in July 2004, Morocco lifted visa requirements for Algerians. Algeria reciprocated with the lifting of visa requirements for Moroccans on April 2, 2005. Algeria has friendly relations with its other neighbors in the Mahgreb, Tunisia and Libya, and with its sub-Saharan neighbors, Mali and Niger. It closely monitors developments in the Middle East and has been a strong proponent of the rights of the Palestinian people, as well as a supporter of Iraq's democratic transition.

Algeria has diplomatic relations with more than 100 foreign countries, and over 90 countries maintain diplomatic representation in Algiers. Algeria held a nonpermanent, rotating seat on the UN Security Council from January 2004 to December 2005. Algeria hosted 13 Arab leaders at the Arab League Summit, March 22-23, 2005.

U.S.-ALGERIAN RELATIONS
In July 2001, President Bouteflika became the first Algerian President to visit the White House since 1985. This visit, followed by a second meeting in November 2001, a meeting in New York in September 2003, and President Bouteflika's participation at the June 2004 G8 Sea Island Summit, is indicative of the growing relationship between the United States and Algeria. Since the September 11, 2001 terrorist attacks in the United States, contacts in key areas of mutual concern, including law enforcement and counter-terrorism cooperation, have intensified. Algeria publicly condemned the terrorist attacks on the United States and has been strongly supportive of the international war against terrorism. The United States and Algeria consult closely on key international and regional issues. The pace and scope of senior-level visits has accelerated. In April 2006, then-Foreign Minister Bedjaoui met with Secretary of State Condoleezza Rice.

In 2006, U.S. direct investment in Algeria totaled $5.3 billion, mostly in the petroleum sector, which U.S. companies dominate. American companies also are active in the banking and finance, services, pharmaceuticals, medical facilities, telecommunications, aviation, seawater desalination, energy production, and information technology sectors. Algeria is the United States' 3rd-largest market in the Middle East/North African region. U.S. exports to Algeria totaled $1.2 billion in 2005, an increase of more than 50% since 2003. U.S. imports from Algeria grew from $4.7 billion in 2002 to $10.8 billion in 2005, primarily in oil and liquefied natural gas (LNG). In March 2004, President Bush designated Algeria a beneficiary country for duty-free treatment under the Generalized System of Preferences (GSP).

In July 2001, the United States and Algeria signed a Trade and Investment Framework Agreement, which established common principles on which the economic relationship is founded and forms a platform for negotiating a bilateral investment treaty (BIT) and a free-trade agreement (FTA). The two governments meet on an ongoing basis to discuss trade and investment policies and opportunities to enhance the economic relationship. Within the framework of the U.S.-North African Economic Partnership (USNAEP), the United States provided about $1.0 million in technical assistance to Algeria in 2003. This program supported and encouraged Algeria's economic reform program and included support for World Trade Organization accession negotiations, debt management, and improving the investment climate. In 2003, USNAEP programs were rolled over into Middle East Partnership Initiative (MEPI) activities, which provide funding for political and economic development programs in Algeria.

Cooperation between the Algerian and U.S. militaries continues to grow. Exchanges between both sides are frequent, and Algeria has hosted senior U.S. military officials. In May 2005, the United States and Algeria conducted their first formal joint military dialogue in Washington, DC; the second joint military dialogue took place in Algiers in November 2006. The NATO Supreme Allied Commander Europe and Commander, U.S. European Command, General James L. Jones visited Algeria in June and August 2005, and then-Secretary of Defense Donald Rumsfeld visited Algeria in February 2006. The United States and Algeria have also conducted bilateral naval and Special Forces exercises, and Algeria has hosted U.S. Navy and Coast Guard ship visits. In addition, the United States has a modest International Military Education and Training (IMET) Program ($824,000 in FY 2006) for training Algerian military personnel in the United States, and Algeria participates in the Trans-Sahara Counter-Terrorism Partnership (TSCTP).

The United States has implemented modest university linkages programs and has placed two English Language Fellows, the first since 1993, with the Ministry of Education to assist in the development of English as a Second Language (ESL) courses at the Ben Aknoune Training Center. In 2006, Algeria was again the recipient of a grant under the Ambassadors' Fund for Cultural Preservation. That fund provided a grant of $106,110 to restore the El Pacha Mosque in Oran. Algeria also received an $80,000 grant to fund microscholarships to design and implement an American English-language program for Algerian high school students in four major cities.

Initial funding through the Middle East Partnership Initiative (MEPI) has been allocated to support the work of Algeria's developing civil society through programming that provides training to journalists, businesspersons, legislators, Internet regulators, and the heads of leading nongovernmental organizations. Additional funding through the State Department's Human Rights and Democracy Fund will assist civil society groups focusing on the issues of the disappeared, and Islam and democracy.

In August 2005, then-Chairman of the Senate Foreign Relations Committee, Senator Richard G. Lugar, led a Presidential Mission to Algeria and Morocco to oversee the release of the remaining 404 Moroccan POWs held by the Polisario Front in Algeria. Their release removed a longstanding bilateral obstacle between Algeria and Morocco.

The official U.S. presence in Algeria is expanding following over a decade of limited staffing, reflecting the general improvement in the security environment. During the past three years, the U.S. Embassy has moved toward more normal operations and now provides most embassy services to the American and Algerian communities.