Algeria is recalibrating its strategic relations, motivated by a combination of economic stability objectives, security concerns, and a desire to better balance its geopolitical ties. In January, Algiers started talks with the EU to rebalance the interests of both parties in their Partnership Agreement and also entered into a first-of-its-kind Memorandum of Understanding (MoU) with the US on military cooperation.
This shift towards mending and enhancing ties with Western powers comes amid growing dissatisfaction in Algiers with Russia’s strategic ambitions and destabilising activities in Africa, particularly in neighbouring states. Algeria’s ties to Russia are deep-rooted – it is unlikely that it can, or will want to, detach itself completely in favour of the West. However, it is actively seeking to even out its political linkages. Algeria’s recalibration offers benefits to Western powers individually and collectively. For the EU, the talks are an opportunity to remove trade restrictions that have impeded both parties’ economic potential and also address illegal immigration concerns; for the US, it can take advantage of Algeria’s shift in posture to reduce its military presence abroad by bolstering Algerian capabilities. Most critically, for western powers, Algeria’s shift in stance provides a window of opportunity to reduce or counter Russian – and to some extent Chinese and Iranian – influence in the North African country.
The Changing Dynamics of Algeria–EU Relations
Algeria has traditionally maintained a multidimensional approach to foreign, security, energy, and trade policy. However, dynamics have shifted in the wake of Russia’s 2022 invasion of Ukraine.
International sanctions on Russian gas have increased the relationship’s importance for both the EU and Algeria. Algiers increasingly sees maintaining and growing its relationship with the EU as critical for its own economic and social stability. The EU is its top trading partner, accounting for more than 50 percent of its trade in 2023. It is also the largest importer of Algerian gas, and with hydrocarbons generating 95% of Algeria’s hard currency revenues and supporting up to 40% of national economic activity, the importance of the bloc to Algeria’s economy cannot be understated. The EU for its part has a non-binding goal to phase out all Russian gas by 2027. Increased imports from Algeria have bumped the country up into second place in the bloc’s suppliers’ list. It accounted for 19% of the EU’s pipeline gas imports in 2023, and in the same year saw 6% growth in its LNG exports to Europe compared to 2019.
In tandem, the push to speed up the global energy transition has underscored Algeria’s need to diversify its economy and Europe’s demand for clean energy supplies. Algeria holds great potential in renewable energy, primarily in solar but also in wind, hydro, and biomass, and launched a National Hydrogen Strategy in 2023, under which it plans to provide close to 10% of Europe’s hydrogen needs by 2040.
Sticking Points in Algeria–EU Relations
Despite significant economic and energy ties, EU and Algeria relations have been fraught of late. Three issues stand out: the Western Sahara dispute, where individual member states such as France and Spain have sided with Morocco; illegal migration, where Algeria refuses to engage with the EU’s migration agenda and the two parties have failed to sign a readmission agreement; and mutual concerns over trade restrictions. In June 2024, the EU launched a dispute settlement case against Algeria in response to restrictions imposed in 2021 on EU exports and investments – which it claims violate the trade liberalisation commitments under the EU-Algeria Association Agreement. In turn, Algeria has expressed frustration over restrictions on its farming and manufacturing exports to the EU, as well as lack of progress on technology transfer and “insufficient'” European direct investments. Algeria has also alleged foreign intelligence agency interference in its domestic affairs and complained about ongoing visa issues – Algeria had the second highest rejection rate for Schengen visas in 2023. Given their geographic proximity, significant trade links and shared issue of illegal immigration, it is in both parties’ interest to work towards repairing ties.
Why Reset Now? Algeria’s Concerns About Russia
Algeria has additional motivations for recalibrating its foreign policy. It has begun to view its relationship with long-time ally Russia with concern – for three key reasons. First, Algeria sees its declining influence in the Sahel region, and poor relations with ruling military regimes in it, as directly linked to Russia’s push for influence across the continent – and its failure to consider Algeria’s strategic interests. Second, Russia’s preoccupation with the conflict in Ukraine has resulted in a slow or significant decline in the supply of defence systems to Algeria – Russia provided 73% of Algeria’s military equipment between 2018 and 2022 and is responsible for maintenance, training, and updates. Third, the destabilising activities of Russian private military contractor Africa Corps (formerly Wagner Group) in Libya, Mali and Niger are threatening Algeria’s border security. While cooperation between Moscow and Algiers will continue – the two signed an Enhanced Strategic Partnership in 2023 – Algeria’s desire to shore up its security, regain its regional influence, secure its economic growth and ensure stability have led the country to take to heart its non-aligned status and build back ties with other major powers.
The Trump Factor: A New Opening for US–Algeria Relations
Donald Trump’s return to the US presidency presents an opportunity to do just that. Algerian President Abdelmadjid Tebboune can take advantage of Trump’s transactional approach to diplomacy to address the two countries’ shared interest in reducing instability in the Sahel – particularly following the US military withdrawal from Niger. For the US, this is a low-effort win: it can reduce US military presence abroad while still combatting security concerns in the region. At the same time, there is an opportunity for Washington to hedge against rising Chinese influence, largely economic, and Iranian attempts to strengthen ties with Algiers. Most crucially, however, the outreach in January is an opening for both Washington and Brussels to encourage Algiers away from Russia and bring it in from the cold.
President’s Trump first term saw a focus on improving the business environment and supporting US investment across Africa through the lens of competition with China and Russia. Since then, the role of these two actors in Africa has only increased. Two-way trade between China and the continent in 2023 – at $282.1 billion – was more than four times that of the US ($67.5 billion), and in the same year Russia announced it had signed agreements on military-technical cooperation with over 40 African states. Trump’s hawkish foreign policy and security team has a clear interest in containing Beijing and Moscow across the continent, and Algeria will fit into that plan.
Outlook: Navigating a Complex Realignment
But the path ahead will not be smooth. The fundamental issues that have negatively affected the EU-Algeria relationship to date will continue to be sticking points, and Algeria’s relatively closed economic and political environment will frustrate increased investments. US engagement will be on its terms, in keeping with Trump’s America First policy. Algeria will continue to engage with multiple powers as part of its non-aligned policy, and while it is far from abandoning its relationship with Moscow, its moves to improve ties with the EU and the US will send a message to the Kremlin. For Brussels and DC, that is a welcome development.