Catering to new customers: Algeria Special report

As elsewhere in the Middle East and North Africa, increasing exposure to brand-named goods, the media and social networks has heightened Algerians’ sense of wanting the best that is available globally. While most shoppers in the capital, Algiers, as well as in the regional cities and towns and rural areas continue to patronise local markets and more informal retail premises, the growing purchasing power of government employees and a rising middle class in a total population of some 38m is fuelling demand for international brands and modern shopping facilities, as well as a host of leisure services and, in an overwhelmingly cash economy, consumer credit.

The Swiss-owned Societe des Centres Commerciaux d’Algerie (SCCA) developed the country’s first modern mall, Bab Ezzouar, outside Algiers, in 2010. It currently averages some 25,000 to 30,000 visitors a day, with 55% to 60% of those making purchases, SCCA reports. This success has led it to plan a second mall, covering 32,000 square metres in Es Sénia, outside Oran, due to open in 2015. designed by Spanish architects, l35, it will include a mix of local retailers as well as international brands and extensive entertainment and leisure facilities.

Foreign investors, including those in retail and real estate development, are expected to play a
part in the huge new $6bn urban complex, New City Hassi Messaoud, being built in the eastern province of Ouargla, one of the country’s most important energy producing regions. Covering some 4,500 hectares, it is due to include 18,000 apartments
and houses, 28 schools, a petroleum institute, a facility for research and development and the head- quarters of the state-owned oil and gas company, Sonatrach, as well as hospitals, health centres and clinics when it is completed in 2018.

In July, the Intercontinental Hotels group announced plans to build the country’s first mid-range, internationally branded hotel, the Holiday Inn Algiers-Cheraga Tower about half an hour’s drive west of Algiers International Airport. Its 283 rooms, meeting facilities and restaurants will be aimed at local and international business visitors.

Other hotel chains, including Sheraton, Marriott International and golden Tulip, have also agreed to participate in a $5bn programme being set up by the government to double the number of hotel rooms in the country over the next three years. Annaba, Constantine and Tlemcen are expected to benefit along with some of the smaller coastal cities favoured by international cruise operators and inland desert sites. The programme aims to increase both domestic and foreign tourism, officials said in July, and to provide more jobs as well as encouraging foreign investment. At present, the country has 1,200 hotels, including 13 five-star premises, with a total of 90,000 rooms. In 2011, Algeria played host to some 2.4m tourists, a figure that was expected to have risen to 3.2m by the end of December.

The full Algeria report can be found in the November issue of The Middle East Magazine