International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2000
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Status Under IMF Articles of Agreement
Article VIIIDate of Acceptance: September 15, 1997
Exchange Arrangement
CurrencyThe currency of Algeria is the Algerian dinar.
Exchange rate structureUnitary.
Managed floating with no preannounced path for the exchange rateThe external value of the dinar is set at the interbank foreign exchange market rate. No margin limits are imposed on the buying and selling exchange rates in the interbank foreign exchange market. However, a margin of DA 0.017 has been established between the buying and selling rates of the Bank of Algeria (BOA) for the dinar against the dollar.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketAuthorized banks may provide forward cover to residents, but this has not taken place.
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements with countries with which no payment agreements are in force are made in convertible currencies. Payments under foreign supply contracts may be made in either the currency in use at the headquarters of the supplier or that of the country of origin of the merchandise, except that transactions with Morocco may be effected in dollars through special clearing accounts maintained at the central banks of the respective countries.
Payment arrangements
Clearing agreementsSpecified noncommercial settlements with Morocco and Tunisia are made through a Moroccan dirham account at the Bank of Morocco and a Tunisian dinar account at the Bank of Tunisia.
Administration of controlThe BOA has general jurisdiction over exchange controls. Authority for a number of exchange control procedures has been delegated to seven commercial banks and the Postal Administration.
International security restrictionsNo.
Payment arrearsNo.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeResidents may purchase, hold, and sell gold coins in Algeria for numismatic purposes. Unworked gold for industrial and professional use is distributed by the Agence nationale pour la distribution et la transformation de l’or et des autres métaux précieux (AGENOR); this agency is also authorized to purchase gold in Algeria and to hold, process, and distribute any other precious metals.
Controls on external tradeAGENOR is authorized to import and export any precious metals, including gold. Gold used by dentists and goldsmiths is imported by AGENOR. Gold and other precious metals are included on the list of items importable by concessionaires.
Controls on exports and imports of banknotes
On exports
Domestic currencyResident travelers may take out up to DA 200 a person.
Foreign currencyForeign nonresident travelers may reexport any foreign currency they declared upon entry. Resident travelers may export foreign currency withdrawn from their foreign currency accounts up to the equivalent of F 50,000 a trip for an unlimited number of trips a year.
On imports
Domestic currencyResident travelers may reimport up to DA 200 a person. Nonresidents are not permitted to bring in Algerian dinar banknotes.
Foreign currencyThere are no restrictions on the importation of foreign banknotes, but residents and nonresidents must declare them when they enter Algeria.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyThese accounts may be freely credited with book transfers of convertible currencies from abroad using either postal or banking facilities, imported convertible foreign currencies that were declared at the time of the account holder’s entry into the country, and domestic bank-to-bank book transfers between accounts held by individuals. These accounts may be debited freely for book transfers abroad but only through the banking system. They may also be debited for purchases of dinars, for book transfers in dinars, and for purchases of convertible foreign currencies to be physically exported by the account holder. The interest rate payable on deposits in these accounts is fixed quarterly by the BOA.

Economic entities are also allowed to open foreign currency accounts for receiving and making foreign currency transfers, including the retained portion of their export proceeds. They may transfer funds in these accounts to other foreign currency accounts or use them to make payments in Algeria or to make foreign currency payments for goods and services pertaining to their business.
Held abroadNo.
Accounts in domestic currency convertible into foreign currencyThese accounts are permitted in limited cases, such as for embassies.
Nonresident Accounts
Foreign exchange accounts permittedThese accounts may be credited with foreign currency banknotes and other means of payment denominated in foreign currency, as well as other dinar-denominated funds that meet all requirements for transfers abroad. They may be debited without restrictions to make transfers abroad, to export through withdrawals of foreign banknotes, and to make dinar payments in Algeria. These accounts pay interest and may not show a net debit position.
Domestic currency accountsFinal departure accounts may be opened, without prior authorization, in the name of any natural person residing in Algeria who is not of Algerian nationality, and who intends to leave Algeria to return to his or her country of origin. These accounts may be credited with an amount equivalent to the holdings as of October 20, 1963, of the person concerned; with the proceeds from sales of real estate by the account holder, provided that the funds are paid directly by a ministerial officer; with the proceeds of the sale of securities through a bank; and with any other payments up to DA 2,000. These accounts may be debited without prior approval for certain payments in Algeria on behalf of the account holder.
Convertible into foreign currencyOutward transfers require individual approval from the BOA.
Blocked accountsIndividual suspense accounts may be opened without authorization and may be credited with payments from any country.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsPayments for imports of gold, other precious metals, and precious stones must be made from foreign currency accounts. External borrowing by importers for import financing purposes must be arranged through the authorized intermediary banks.
Advance payment requirementsExcept when otherwise indicated by the BOA, down payments for imports may not exceed 15% of the total value of imports. When a public agency, public enterprise, or ministry incurs expenditures for imports deemed to be urgent or exceptional, the bank may effect payment before exchange and trade control formalities have been completed.
Advance import depositsAlthough not an official regulation, domiciled banks may require from the importer, as part of their normal commercial operations, a deposit in dinars up to the full value of the imports.
Documentation requirements for release of foreign exchange for imports
Domiciliation requirementsAll imports are subject to obligatory domiciliation at an authorized intermediary bank, which an importer must establish by submitting a commercial contract or pro forma invoice. Import payments may be made freely but only through the domiciled bank, which effects payments in foreign exchange and debits the importer’s account with corresponding amounts in dinars valued at the official exchange rate. Imports must be insured by Algerian insurers.
Preshipment inspectionYes.
Letters of creditYes.
Import licenses and other nontariff measuresAny juridical or natural person registered under the Commercial Register (including concessionaires and wholesalers) may import goods without prior authorization; no license is needed.
Negative listThere are no legal restrictions against Israel, but there are no imports from Israel in practice. A small number of imports are prohibited for religious or security reasons.
Import taxes and/or tariffsNo.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsProceeds must be repatriated within 120 days. Petroleum companies are subject to the same rule, but proceeds may be deposited in a guaranteed account with a foreign correspondent bank of the BOA.
Surrender requirementsAll export proceeds from crude and refined hydrocarbons, byproducts from gas, and mineral products must be surrendered to the BOA. Exporters of other products must surrender 50% of the proceeds to the interbank market; the remaining portion may be retained in a foreign currency account. Exporters may use the funds in these accounts for imports or other payments pertaining to their business, or they may transfer the funds to another foreign currency account. Proceeds from exports of nonhydrocarbons, and nonminerals may be surrendered to commercial banks and other authorized participants in the interbank foreign exchange market.
Financing requirementsNo.
Documentation requirementsThe requirements are not enforced in practice.
Letters of creditYes.
Preshipment inspectionYes.
Export licensesAll exports to Israel are prohibited, and certain exports are prohibited for social or cultural reasons regardless of destination.
Export taxesNo.
Payments for Invisible Transactions and Current Transfers
Controls on these transfers
Investment-related paymentsInformation is not available on the payment or transfer of amortization of loans or depreciation of direct investments.
Prior approvalProfit remittances are permitted, provided tax obligations have been met.
Payments for travelForeign exchange allocation for tourism by Algerian residents was suspended in October 1986. Pilgrims traveling to Saudi Arabia receive an allowance in Saudi Arabian riyals. The amount is fixed for each pilgrimage and may be provided in the form of checks that may be cashed on arrival for those traveling by air or by sea. Travel tickets purchased by nonresidents for travel abroad must be paid for with imported foreign exchange.
Prior approvalYes.
Quantitative limitsThe quantitative limit is DA 15,000.
Indicative limits/bona fide testYes.
Personal payments
Prior approvalApproval of the BOA is required for transfers of pension income. For family maintenance and alimony payments, the BOA must authorize the granting of foreign exchange. Limits are set on a case-by-case basis.
Quantitative limitsThe limits for medical costs are DA 15,900 for adults and DA 7,600 for children under 15 years old. For studies abroad, the limit is DA 7,500.
Indicative limits/bona fide testInformation is not available on family maintenance and alimony transfers.
Foreign workers’ wagesResidents of other countries working in Algeria under technical cooperation programs for public enterprises and agencies or for certain mixed companies may transfer abroad up to 100% of their salaries.
Indicative limits/bona fide testYes.
Other payments
Prior approvalApproval of the BOA is required for payments relating to subscriptions and membership fees and consulting and legal fees.
Indicative limits/bona fide testYes.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsFifty percent of receipts must be surrendered to the banks.
Restrictions on use of fundsNo.
Capital Transactions
Controls on capital and money market instrumentsCapital transfers to any destination abroad are subject to individual approval by the BOA.
On capital market securities
Shares or other securities of a participating nature
Purchase abroad by residentsYes.
On money market instruments
Purchase abroad by residentsYes.
On collective investment securities
Purchase abroad by residentsYes.
Controls on derivatives and other instruments
Purchase abroad by residentsYes.
Controls on credit operationsThere are controls on all credit transactions, guarantees, sureties, and financial backup facilities by residents to nonresidents.
Controls on direct investment
Outward direct investmentYes.
Inward direct investmentForeign direct investment is permitted freely except in certain specified sectors, provided that it conforms to the laws and regulations governing regulated activities and that prior declaration is made to the authorities.
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase abroad by residentsYes.
Controls on personal capital movementsn.a.
Provisions specific to commercial banks and other credit institutions
Borrowing abroadBanks and financial institutions may borrow from abroad for their own needs or for those of their clients.
Lending locally in foreign exchangeBanks and financial institutions may on-lend foreign funds borrowed abroad.
Differential treatment of deposit accounts in foreign exchange
Interest rate controlsThe interest rates applicable to foreign currency accounts are determined quarterly by the BOA.
Open foreign exchange position limitsBanks and financial institutions are required to meet the following: (1) a maximum spread of 10% between their position (short or long) in each currency and the amount of their counterpart funds in domestic currency; and (2) a maximum spread of 30% between total exposure (short and long positions, whichever is highest) for all foreign currencies and domestic currency resources.
Provisions specific to institutional investorsNo.
Other controls imposed by securities lawsn.a.
Changes During 1999
No significant changes occurred in the exchange and trade system.

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