| Kippreport.com

Algerians use regional unrest to press pay demands

March 14, 2011 12:42 by Reuters

WILDFIRE

The demands for better pay and conditions appear to be spreading like wildfire from one sector to another, fuelled by a government which in many cases has bowed to protesters demands.

Last week, 2,000 officers with the municipal guards, a sort of auxiliary police force which helped fight an Islamist insurgency in the 1990s, staged a protest in front of parliament to demand better pensions.

“They have used us to combat terrorism, and now that it has been defeated they have decided to abandon us,” one of the protesters said.

A day later, about 50 blind people protested outside the capital’s main post office seeking improved welfare payments.

In the same week, the head of the state energy company, Sonatrach, flew down to a gas field in the Sahara desert to address workers’ demands for more pay.

Newspapers reported that legal clerks were given a 120 percent pay rise after going on strike. Even chauffeurs from the presidential car pool are on strike, according to a government official.

Political scientist Lagab said that, faced with these kind of demands, the authorities have little room for manoeuvre. “The government has no choice but to say yes. If it says no, the citizens may make politically-oriented demands,” he said.

Algeria’s authorities can afford the payouts. The state has about $150 billion in foreign currency reserves – one of the largest reserves in the world and roughly equivalent to the country’s gross domestic product.

Still, some economists worry about the long term impact of loosening fiscal policy.

“This is a dangerous strategy for the mid- and long-term. We all know that Algeria produces no wealth and relies on oil revenues,” Abdelwahab Boukrouh, a senior economic journalist, told Reuters.

“I understand that politicians are under pressure and will do everything to prevent an Egypt scenario from happening here, but raising salaries without raising production is a nonsense,” said Boukrouh, who works for the Echorouk newspaper.

With violence in Libya pushing oil prices over $100 per barrel, Algeria’s revenues from energy exports are rising, giving the government even more scope to spend its way out of trouble.

Yet even some of the citizens who stand to benefit see that as short-sighted. “Oil money is available now, but for how long?” asked Farid Ferrahi, an Algiers resident.

(By Lamine Chikhi. Editing by Ralph Boulton)

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Tags: Algeria, Algeria economy, Algeria pay, Algeria pay hikes, algeria protests, algeria strikes, algeria unrest, north Africa unrest