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= Poverty in Algeria = Algeria, North Africa’s geographically largest country with a population of approximately 42 million, is a wealthy nation and one of the most significant economies in the Middle East and North Africa. However, poverty rates in Algeria are quite high, and this can be attributed to unemployment levels, a lack of democracy, political conflict, the nations economic history and government spending.

Prevalence of Poverty
According to the National Statistics Office, Algeria has experienced significant changes in poverty levels, falling to 5.5% in 2011 from 14.1% in 1995. Although the percentage of the population surviving on less than $2 per day has stabilised at 14.1% in 1995 after decreasing from 81% in 1988, it has since fallen to 5% in 2011. The income share held by the lowest 20% of Algeria has increased from 6.5% in 1990 to 9.4% in 2010, which speaks to the inequality of wealth within the nation.

According to the Central Intelligence Agency, the population below the poverty line in Algeria as of 2006 is estimated to be at 25%, and rates of extreme poverty sit at 0.5%. However, 10% of Algeria’s populations are seen as susceptible to falling back into poverty if conditions conspire against them. Around 75% of Algerian’s living in poverty reside in urban areas and complete informal work. Regional differences have resulted in twice the amount of individuals living in poverty inhabiting Algeria’s Sahara, and three times the nations average living on grassland.

According to the Global Hunger Index, out of 119 qualifying countries, Algeria was placed 39th with a score of 9.4, meaning that the nation suffers from a hunger level of low. This score has consistently improved over the past 2 decades, with the year 2000 recording a score of 15.6 (moderate hunger level) and 2010 recording 10.6 (moderate hunger level). In addition, the proportion of undernourished in the population has decreased from 10.7% in 2000 to 4.7% in 2018. However, the prevalence of wasting children less than 5 years of age has increased from 3.1% in 2000 to 4.1% in 2018 and additionally, the occurrence of underweight children under the age of 5 has decreased to 2.6% (2009). Further, the life expectancy at birth for Algeria as of 2016 is 76.078 years, which is an increase from the expectancy in 2000, which sat at 70.29 years.

Although literacy rates between youth (aged between 15-24 years) sat at 94.4% for males and 89.1% for females (between the years of 2008 and 2012), public spending allocated to education as a proportion of GDP sat at only 4.3% (between 2008-2010). This makes public education less accessible, even more so to those who experience poverty, as well as of worse quality, which only contributes to rates of poverty amongst the nation.

Economic History
As a result of declining revenue in the oil and gas industry, Algeria narrowed its trade surplus, as they are increasingly reliant on imports. Algeria saw a trade deficit of $8.2bn in 2015, decreasing from a surplus of $2.3bn in the first half of 2014. This resulted from a drop in the value of oil exports and lower global commodity prices. Valued at $8.7bn, the main category of imports in 2015 was industrial equipment, with semi-finished products following at $5.9bn and food at $5.13 bn. Despite this, Algeria’s trade deficit widened to $10.8bn, which is significantly less than the surplus of $4.29bn in October 2014.

Effects of Trade Deficit
As the nation is running a trade deficit and importing more than they are exporting, initially, Algeria’s standard of living would be raised as domestic consumers have access to more goods and services of higher quality at lower costs. However, in the long run, an increase in importing creates jobs for international residents, and local companies go out of business and domestic industries lose required skills for operation. As domestic residents lose jobs and unemployment rates rise, so do the rates and prevalence of poverty within a nation.

National Policies and Social Development
Algeria strengthened its fight to reduce poverty and social development policy at the end of the 1990s, which facilitated advancement in the standard of living among the Algerian population. The provisions of the Finance Bill 2016 allocated most of its budget to sectors such as education (15.9%), health (7.9%) and employment assistance (4.7%), thereby enabling increased standards of living and reduced rates of poverty - an improvement on figures from as recent as 2010.

Policy of Subsidies and Transfers
Due to the resources drawn from exporting hydrocarbons, a programme of social support is made possible, including subsidies of retail prices among other social transfers. This helps contain social pressure, and allows Algeria to invest more heavily into the development of human capital, and thereby reducing poverty.

Social Housing
Holding 14.21% of the total equipment budget of Algeria, the state of Algeria enables access for the population to housing through various programmes, the main being the National Agency for Housing Improvement and Development.

Prices of Fuel, Gas, Water and Basic Consumer Goods
Algeria maintains among the lowest retail price of oil and gas in the world thanks to subsidies and government intervention, and the state subsidises the water supply to households in coastal towns, financing the desalination of seawater. In addition, the subsidising of milk, cereal and other essential products make it possible to keep these items at an affordable price for the population.

Poverty and Unemployment
High rates of unemployment are the leading cause of poverty in Algeria. Analysis undertaken by the United Nations Economic Commission for Africa of the unemployment situation in Algeria reveals significant disparities based on gender and age. The unemployment rate as of 2015 was estimated to be 11.2%, however, those within the age group of 16-24 stood at almost 30%. In addition to this, unemployment affects almost twice the number of women as it does men, with unemployment estimated at 16.6% for women.

In the mid 1980s, basic macroeconomic indicators deteriorated between 1987 and 1995 resulting in prolonged economic recession, high rates of national debt and growing social unhappiness. The lack of economic growth in Algeria meant that the creation of employment was absent, and unemployment rose to 27% in 1994 as a result. Previously, the government responded to rising growth in job seeking by intensifying public sector employment. However, as economic activity declined and oil prices collapsed, the public sector employment slowed down which in turn contributed to the rising rates of poverty.

In saying this, unemployment rates have dropped over the last decade, with a report from 2008 stating that unemployment among individuals under 30 was at an extremely high 70%. High unemployment rates combined with low quality of life forced the youth of Algeria to undertake desperate measures, such as illegal immigration, to find work in Europe.

Political Conflict
In a way to justify the nations economic position, many Algerian’s blame ineffective and unresponsive political leadership. The National Liberation Front reduced the nation to bankruptcy, contributing to the level of poverty within Algeria. Additionally, the Algerian Civil War between the government and armed Islamic Rebel groups between the years of 1991 and 2001, coupled with political tensions after the war, deteriorated the nations economic and political stability, reducing the quality of life for the population of Algeria, and in turn increasing levels of poverty.

Lack of Political Democracy
The absence of a democratic institute is a further source of poverty in Algeria. Although the president of Algeria, 80-year-old Abdelaziz Bouteflika, is well respected for getting the nation out of civil war and eliminating militant and radical jihadi groups, the administration under his instruction has grown intolerant of political conflict and press. In addition, there is a struggle for power between the progressive National Liberation Front political party and the conservative Islamic Front. Any political instability can have devastating effects on the rates of poverty within a nation.

Future Directions of Algeria (relation to poverty)
Tackling inequality is a significant challenge for the nation of Algeria. Consumption rate inequalities are high, and there is a 27.7% gap between the rich and poor, which has improved significantly from 40.2% in 1988.

In order to tackle poverty, addressing the largest cause, unemployment, is vital for Algeria. In understanding this, the government has put in place a number of initiatives to reduce unemployment. This is done through the facilitation and integration of a significant number of unemployed youth into the workforce, utilizing programmes implemented by national youth employment provision agencies. In addition to this, the Government set up a system of benefits to provide financial support to the unemployed, equipping them with the necessary skills to assist in their integration back into the workforce. As a result of this Government intervention, between 2010-2015, over 1.5 million young people in Algeria were placed in the workforce. This, however, is an inadequate number given the current levels of youth unemployment which contributes highly to the poverty rate.

Aside from unemployment, Algeria has made notable increases in social and human development in recent years, with social indicators such as education, health, and access to basic services recording substantial developments. Algeria currently records a high level of income and human development. This, combined with attempts to reduce unemployment rates, will help Algeria combat poverty.

Economic predictions for Algeria all remain dependant on oil price movements, as current levels are pressuring the nations trade and fiscal balances. Nevertheless, this pressure is seeing the nation pushing for more investment and raising established plans for diversification economically. In the long run, this will create a more sustainable economic future, which would assist in the prevention and combat of poverty in Algeria.

Among the emerging areas of importance in Algeria are individuals who are in their second decade of life - teenagers. Studies have been targeting out-of-school youths to better understand why so many adolescents drop out of school every year, and where they go from there. Whether it is to pursue further education and training, or to enter the workforce, Algeria’s 2016-2020-country programme aims to prevent school dropouts. School dropout rates are often linked with poverty, as individuals seek out employment to earn money and raise their economic position. This creates further issues though, as literacy and numeracy skills are impacted, making it difficult further in life for individuals who are seeking to broaden their careers.