UNLOCKING ALGERIA'S MINING POTENTIAL: INVESTMENT OPPORTUNITIES FOR FINNISH COMPANIES
Mining industry in Algeria is on the cusp of a transformative shift as the government is committed to create a favorable environment for foreign investors and intelligent mining practices by modernizing its Mining Law, along supportive infrastructure projects and policy reforms. With vast untapped mineral resources and strategic geographic advantages, Algeria presents a significant opportunity for Finnish companies.
Algeria, Africa’s largest country by land area covering 2.4 million km², is rich in untapped mineral resources, yet its mining sector contributes only 1% to its $260 billion GDP (2024). However, the government is committed to unlocking this potential by overhauling its Mining Law and improving the investment climate to attract foreign investment, as part of its strategy to diversify away from hydrocarbons. This transformation presents a prime opportunity for Finnish companies to lead in innovation, shape future growth, and capitalize on Algeria’s expanding economy, with its GDP projected to reach $370 billion by 2030.
As such, Algeria’s mining sector is becoming a key destination for mining and industrial investment, attracting growing foreign interest. Companies such as the Chinese Sinosteel, providing services on the $7 billion Gara Djebilet iron ore project, and Terramin Australia, which operates the Oued Amizour zinc-lead project, are key players already present in the market. Additionally, Qatar Steel and Tosyali have significant operations established in steel production. Furthermore, companies from Belgium, Malaysia, Oman and Indonesia are currently exploring opportunities.
Reasons of this interest reside in Algeria’s strategic location near Europe, as well as its extensive untapped and potential reserves that include strategic minerals such as:
Iron ore (3.5 billion tons), one of the largest reserves in the world; phosphate (2.2 billion tons); barite, bentonite, critical minerals like zinc- lead ore (35 million tons). Moreover, Algeria boasts the largest reserves of gold in the continent, estimated at 173.56 tons; and holds emergent resources such as copper, sulfur, manganese lithium, nickel, uranium, as well as vanadium, titanium, cobalt, molybdenum, and rare earth elements. These resources are primarily concentrated in southern deposits and still awaiting full exploration, for which Algeria wishes foreign expertise and investments.
Furthermore, to increase foreign investment in the mining industry, Algerian government is set to imminently adopt a comprehensive overhaul of its Mining Law, comprising the removal of the previous 49% limit for foreign ownership rule and raising it to 80%, with 20% mandatory government intake through its state company Sonarem, or its 12 subsidiaries.
Additionally, efforts towards various investment policy reforms, streamlined licensing processes, tax incentives, and improved access to geological and mineral data mapping (provided by the Algerian Geological Service Agency) are meant to create a favorable environment for international mining companies. Besides, major infrastructure projects, including ports, airports, and rail networks, are also under planning to connect resource-rich southern regions with northern facilities, further supporting mining development.
In conclusion, Finnish companies, known for their advanced expertise in sustainable mining practices, digital solutions, and automation, are well positioned to seize this emerging market. Leveraging their technological prowess and commitment to environmental responsibility gives an edge for the companies themselves, but could also contribute to the development of the Algerian mining sector.
For additional information on the sector and support in the Algerian market, please contact Choubeila Belkhir ([email protected]) and Andrea Tanzi-Albi ([email protected]).
Text: Choubeila Belkhir, Trade and Economic Affairs at the Consulate of Finland in Algeria