From Crude to Crop: Cultivating Economic Diversity in Algeria  through Agricultural Sector

Seyf Eddine Benbekhti, Ilhem Benaissa, Fatima Benbouziane, Hadjer Boulila

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Published: Nov 2, 2024

Keywords:

Economic diversification, agriculture, Non hydrocarbon sector, Algeria, VAR model.

Seyf Eddine Benbekhti, Ilhem Benaissa, Fatima Benbouziane, Hadjer Boulila

Abstract

This study aims to critically evaluate Algeria's shift towards economic diversification with a special emphasis on the agricultural sector's contribution. Employing Vector Autoregression (VAR) models over the time span from 2000 to 2024, we analyze the interconnected effects of shocks in non-hydrocarbon sectors, government agricultural spending, food imports, and foreign direct investment in agriculture on the diversification process. The methodology integrates a comprehensive set of variables, including GDP from non-oil sectors, agricultural productivity,government expenditures on agriculture, and import-export dynamics and HHI calculated index to provide a multifaceted view of the economic diversification landscape. Results highlight the potential of the agricultural sector as a key driver for reducing oil dependency and suggest recommendations for strengthening sector linkages, optimizing government spending, and enhancing competitiveness.

Issue

Vol. 61 No. 11 (2024)

Section

Articles

This work is licensed under a Creative Commons Attribution 4.0 International License.

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