RETHINKING THE FISCAL RISK MANAGEMENT FRAMEWORK IN ALGERIA

Abstract

Algeria, a commodity exporter country- faces fiscal risk from diverse sources, including volatility of oil prices, financial sector exposure, the state owned enterprises, and other macroeconomic and specific shocks. Historically, these shocks, especially sudden declines in oil prices, have had an adverse impact on the economic activity and public finances. However, this paper shows that Algeria, currently, has some tools to mitigate some risks, while, there is not a comprehensive framework to analyze and manage all fiscal risks. Hence, the study emphasize the fact that Algeria may need to rethink its fiscal risk management framework through putting  in place international best practice , in order to ensure sound fiscal public finances and more macroeconomic stability.