Spain gambles 2,000 million per year in exports to Algeria and the continuation of gas supplies

  • Algeria “immediately” suspends friendship treaty with Spain after Sanchez reaffirms its hold on the Sahara

conflict between Spain and Algeria that it announces Wednesday The end of relations with our country And today it has ordered its banking services to interrupt any transactions relating to foreign trade between the two states, it puts around 2,000 million euros in sales For companies that usually export to an African country and the continuation of air carrier for our energy.

As per tax agency data collected by ICEXvalue of export Average amount from Spain to Algeria in 2021 155 million euros per monthwhich makes the annual sum of About 2,000 million euros. Definitive sales data for Algeria in 2021 is unknown, but in 2020 we exported goods of value 1,916 million euros.

If these sales are disrupted now, the companies most affected will be the main sellers in Algeria who are dedicated to iron and steel foundry (8% of total exports, representing 160 million euros in 2020); producer of Machines and Mechanical Equipment (8% also, 156 million); Paper and Cardboard Manufacturers (7%, 128 million); provider of Mineral fuels and oils (6%, 108 million); plastic material (6%, 106 million); material shades (5%, 101 million) and electric appliances (5%, 97 million).

More residual, although this is also important, is the sale of animal and vegetable fats, oils (4%, 73 million euros); manufacturing Celebrations (3%, 66 million) and others chemicals (3%, 65 million).

,Algeria is a priority market for Spain, According to data from AEAT of Spain, export Represented from Spain to Algeria in the year 2020 0.7% of our total salesstands as our 21 worldwide customers and our second African customer after Morocco”, explains ICEX in its report on bilateral relations.

The interruption in Algeria’s purchase of these Spanish products will affect our external demand, although not excessively, as they represent only 0.7% of our total exports, but Yes can be more harmful to companies For which Algerian sales account for a significant market share.

turn off the gas tap

The impact on our country can also be felt through ImportIn fact Spain has traditionally maintained a trade deficit with algeriaBy buying a lot more from it than we sell it, energy is what has always interested us the most in the African country.

,Bilateral trade has always been at a loss for Spainwho buys almost from algeria 47% of all imported gas (Latest available data from January – August 2021). In terms of the trade balance, this means that Spanish imports from Algeria exceed exports to the Maghreb country,” explains ICEX.

However, purchased from Algeria only a . represents 0.9% of our global imports And that country is ranked 25th in the world ranking. This is our third supplier on the African continent, after Morocco and Nigeria.

In 2021Between January and August, the average value of imports every month ascending a €320 millionwhatever leaves Annual purchases of about 3,800 million euros. In 2020, imports from that country amounted to 2,511 million euros, much lower than the -3,852 million- recorded in 2019 and -4,666 million- recorded in 2018.

The main products that make up our basket of imports are fuels and lubricants, especially gaswho represent 92% of total purchases from that country, for the value of 2,303 million euros in 2020, They are followed by fertilizers and inorganic chemical products with a ratio of 3%, and far behind, with purchase volumes of less than 12 million euros per year, seeds, fish, crustaceans, mollusks, glass, sugars, fruits and vegetables. . copper.

Now, despite the good trade relations that traditionally existed with that country, Change in the position of the government with respect to the Shar Obviously this has strengthened bilateral ties with Morocco, but at the cost of spoiling it we are maintaining with Algeria. Spain is The first supplier and the first customer from Morocco, Of which we export about 760 million euros per month, about 9,000 million euros per year, and of which we import 620 million per month, about 7,500 million per year.

Algeria decided to suspend friendship treaty It’s been with Spain for two decades and is set to end commercial ties, which in practice means they can stop selling gas to us (instead, they’ll sell it to Spain). Italy who has already positioned himself to be yours preferred customer) and they will not buy the products they used to buy from us.

Spanish companies will be the most affected in the energy sector Natural, Repsol and Sepsa, But since they have signed long-term purchase contracts with that country, they are confident that at least those contracts—which in many cases are for ten years—will be fulfilled.

“I think, and I don’t know that I’m confusing my desires about what’s going to happen, that Doesn’t affect the gas we buy in Algeria“, told the CEO of This Thursday Endesa, Jose Bogas, During the III International Expansion Forum.

“As I read in an article, we are between two enemies (Algeria and Morocco) and we both want to get alongWho hopes and wants “this tension to subside as quickly,” Bogas said. Spain is interested in both“, he insisted.

Minister of Ecological Transicin, Theresa Rivera, has, for its part, affirmed that since they are contractual relations between private companies and are valid for at least ten years, He does not believe that there will be tension in the gas supply.

Nevertheless, the government is aware that the supply of liquefied gas from Algeria is already at stake. Has positioned itself to try to increase purchases from other suppliers as Nigeria (11.4%) Y Queue (6.3%). It is not by chance, in fact, that both the President and the King of Government recently welcomed him. Amir Tamim bin Hamad Al Thanik you ali Nigerian President Muhammadu Buhari.

The country must ensure its gas supply for the next winter, although it must also recognize that it will pay a higher price to obtain it, and that Make our balance of trade more expensive turn it up inflation problem Families and businesses are already suffering.

“A radical change in one of the most sensitive issues of our foreign policy has completely changed the geopolitical, strategic and economic landscape of our country. Here are some of the outcomes we can expect: that of Algeria finally cut off the gas supply to Spain. This would mean that 40% of our needs are too severely compromised (…), that Algeria, in the hypothetical case of re-establishing the supply, charges us too expensive (…) or that our big energy companies, Repsol, Naturgi, Iberdrola face serious problems and work hard”winter of discontent“What would Shakespeare say?” Eduardo Erastorza, Professor at OBS Business School.

according to the norms of

trust project

know more

About the Author

The co-owner & marketing chief of "The Business News", Sravya is also good at Writing and communicating. she has good networking skills. she is really passionate about publishing quality news articles. - - You can reach Her at Facebook:- @sai.sravya.3910

Leave A Response