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Viewing cable 09ALGIERS887, ALGERIAN INDUSTRY MINISTER REAFFIRMS INTEREST IN

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Reference ID Created Released Classification Origin
09ALGIERS887 2009-10-01 12:49 2011-08-30 01:44 CONFIDENTIAL Embassy Algiers
VZCZCXYZ0000
RR RUEHWEB

DE RUEHAS #0887/01 2741249
ZNY CCCCC ZZH
R 011249Z OCT 09
FM AMEMBASSY ALGIERS
TO RUEHC/SECSTATE WASHDC 7946
INFO RUCNMGH/MAGHREB COLLECTIVE
RUEHEG/AMEMBASSY CAIRO 1248
RUEHLO/AMEMBASSY LONDON 1855
RUEHNK/AMEMBASSY NOUAKCHOTT 6796
RUEHFR/AMEMBASSY PARIS 3163
RUEHCL/AMCONSUL CASABLANCA 3693
RUEATRS/DEPT OF TREASURY WASHDC
RHEBAAA/DEPT OF ENERGY WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
C O N F I D E N T I A L ALGIERS 000887 
 
SIPDIS 
 
STATE FOR NEA/MAG 
STATE PASS FOR USTR 
COMMERCE FOR NATE MASON 
 
E.O. 12958: DECL: 10/01/2019 
TAGS: ETRD EINV EFIN ECON AG
SUBJECT: ALGERIAN INDUSTRY MINISTER REAFFIRMS INTEREST IN 
WTO 
 
Classified By: David D. Pearce, Ambassador.  Reason:  E.O. 12958 1.4 (b 
), (d) 
 
1. Summary:  Minister of Industry told USTR Director Burkhead 
that Algeria remains interested in acceding to the WTO and 
engaging with the U.S. in the framework of our bilateral 
Trade and Investment Framework Agreement.  He nevertheless 
believed the government had to exert more control over 
imports and repatriations of profits by foreign companies. 
End summary. 
 
2. USTR Director for Middle Eastern and European Trade 
Affairs Paul Burkhead, accompanied by the Ambassador and 
Pol-Econ Chief (notetaker), met with Minister of Industry and 
Investment Promotion Abdelhamid Temmar in his offices 
September 27.  Temmar was accompanied by his chief of staff, 
and the ministry's Director General for Investment, Hamoud 
Benhamdine.  The meeting was conducted in English.  Burkhead 
led off by emphasizing that the U.S. wanted to expand trade 
and investment ties with Algeria.  Terrar immediately 
volunteered that Algeria still wanted to accede to the WTO 
and join the world economy.  The more open the Algerian 
economy was, the more Algeria would win.  After discussions 
three years ago, Algeria thought all had been settled, but 
progress had then stalled.  Algeria did not know how to 
proceed or how to ''improve our answers.'' 
 
3. Burkhead underscored that the U.S. stood ready to partner 
with Algeria in its accession efforts.  He proposed an 
informal meeting between USTR and Algerian representatives to 
discuss where we stood on WTO accession, and our bilateral 
trade and investment relationship -- the latter in the 
context of the U.S.-Algeria Trade and Investment Framework 
Agreement, which had not been used since 2004.  Temmar agreed 
this would be desirable, although the Minister of Commerce 
would take the lead. 
 
4. Temmar brought up the 2009 Complementary Finance Law, 
which he admitted included measures that business questioned, 
and that could be interpreted as the beginning of a 
restoration of state management of the economy.  He noted as 
background that while the private sector was responsible for 
75-80 percent of GDP, state owned industry produced 70 
percent of Ageria's industrial product, a legacy of Algeria's 
socialist past.  Algeria had to protect and build up this 
industry.  Temmar explained that the Algerian state was rich, 
and had decided to emphasize joint ventures between Algerian 
and foreign partners as the preferred form of foreign 
investment.  He claimed discussions were underway for 
approximately 15 such ventures, including in automobiles and 
aluminum.  The government would give foreign partners full 
management rights for at least 10 years. 
 
5. Burkhead interjected that the minimum 51 percent Algerian 
share requirement for all new foreign investments would be an 
obstacle for U.S. investors.  Temmar replied that the 
Algerian government envisaged the government taking an 
average 15 percent share, leaving the rest of the Algerian 
component to domestic private investors, which would leave 
the U.S. investor a relative majority stakeholder. 
 
6. Burkhead stated that the limitation on repatriation of 
profits would also discourage investors.  Temmar argued that 
the government had reacted to the Egyptian wireless operator 
Jezzi's attempt to transfer USD 600 million in a single 
transaction.  Officials had also discovered that Jezzy had 
not paid all its taxes.  Temmar admitted that officials who 
were ''old socialists'' like himself had been shocked by the 
news of the $600 million transfer.  Jezzy would have been 
better advised to alert the government ahead of time about 
such large transfers.  The Minister of Industry would follow 
up on the case with the Ministry of Finance and Customs. 
Burkhead suggested to the minister that the government might 
have addressed the Jezzy case individually rather than 
implementing a response that affected all foreign companies. 
 
7. Burkhead also commented that Algeria had high rates of 
piracy of intellectual property.  Temmar admitted that IP was 
a new concept in Algeria, which was progressing slowly in 
 
protecting it.  Algeria's IP protection office, the National 
Office of Copyright and Intellectual Property (ONDAPI), was 
under his ministry.  He had just replaced its chairman. 
Algeria would welcome assistance from and brainstorming 
sessions with the U.S.  Burkhead pointed out that Algeria has 
had a legal framework for IP protection for several years. 
It remained for Algeria to educate the people to create a 
culture of IP protection, and to enforce the law. 
PEARCE