GOVERNANCE AND ECONOMIC GROWTH - THE ALGERIAN CASE

The passage of Algeria from annuity and administered economy to an economy of market, its insertion in the free trade area with the European Union, and its membership to the World Trade Organization (WTO), commit the country in a new phase of profound transfers which touch the organization, the structures and the modes of management which, for a long time, characterized the governance of the Algerian companies. Indeed, the opening of the Algerian economy requires an acceleration of priority reforms intended to encourage the private investments, to diversify its its economy to make it less dependent on hydrocarbons, and to create jobs. Compared to the figures of the 1990s, the growth of the Algerian economy has known significant increase since 2000. This improvement of the economic situation contains however some reserves. First of all, it does not concern all sectors; moreover, the external factors including the increase of oil prices and the manna which resulted have contributed strongly to this growth. To generalize this growth to all sectors and reduce its volatility according to the oil sector, international organizations (World Bank and IMF) recommend to improve the governance. To do this, the public authorities have adopted international standards, and have undertaken structural reforms to create an environment and an effective regulatory framework, in order to promote economic growth and durable development. It is the membership of Algeria to the principles of good governance. However, Algeria remains unattractive in foreign investment despite the importance of resources available. Also, the non-hydrocarbon sector displays very low growth rate. Our communication attempts to analyze the relationship between the state of the governance and economic growth in Algeria.