The Algerian construction sector, comprising numerous small and medium-sized enterprises, is severely impacted by the country's economic crisis. In Béjaïa province, these businesses are experiencing significant financial difficulties. According to a company manager in El Kseur, the sector's financial struggles began in 2015 and worsened over the years, with a null balance recorded at the end of 2018. This has led to concerns about the sector's sustainability.
Many construction companies in Béjaïa are facing significant challenges, including high salary costs that hinder business development. Some companies have been forced to lay off employees or put them on technical leave in anticipation of better times. A small business owner in Akbou noted that the high salary costs compromise the company's ability to invest in growth. This has resulted in a decline in business activity, with some companies on the brink of collapse.
The situation is dire, with nearly half of the construction companies and promoters in Seddouk either at a standstill or on the verge of bankruptcy. A company manager in Seddouk reported that their workload and order books are almost empty, and without urgent government intervention, the consequences will be severe. The manager expressed concerns about the company's inability to recover debts due to a lack of resources, leaving them unable to pay employees or honor their financial obligations.
Industry leaders argue that the economic and social pact has not been respected, and the 25% national preference for public markets has not been implemented. They are calling for the government to release companies from their control and allow them to operate freely. The construction sector is not alone in its struggles, with many businesses across various sectors facing significant financial challenges due to debt and investment obligations.
The reduction of 20% in equipment spending announced in the 2020 finance bill has raised concerns about the sector's future. Construction companies are struggling with fiscal and parafiscal debts, as well as investment debts contracted with banks. The situation is becoming increasingly difficult, with many businesses facing an uncertain future.
According to industry insiders, the lack of government support and the challenging economic environment are exacerbating the sector's woes. Companies are calling for urgent measures to address the crisis and prevent further financial distress. Without government intervention, many construction companies in Béjaïa and beyond may be forced to close their doors.
The decline of the construction sector in Béjaïa has significant implications for the local economy and employment. With many companies on the brink of collapse, the situation is becoming increasingly critical. Industry leaders are urging the government to take immediate action to support the sector and prevent a complete economic meltdown.
Key points
- Algerian construction companies face significant financial challenges due to economic turmoil and lack of government support.
- The sector's struggles have severe implications for the local economy and employment.
- Industry leaders are calling for urgent government intervention to prevent further financial distress.
