Gazeteer of Algeria

Background
After a century of rule by France, and in the wake of 1948 elections rigged by French colonists to reverse the sweeping victory of a Muslim political party in 1947, Algerians fought through the 1950s to achieve independence in 1962. Algeria's primary political party, the National Liberation Front (FLN), has dominated politics ever since. Many Algerians in the subsequent generation were not satisified, however, and moved to counter the FLN's centrality in Algerian politics. The surprising first round success of the fundamentalist Islamic Salvation Front (FIS) in the December 1991 balloting spurred the army to intervene and postpone the second round of elections to prevent an extremist-led government from assuming power. The Algerian army began a crack down on the FIS that resulted in a continuous low-grade civil conflict between Islamic activists and the secular state apparatus. The government later allowed elections featuring pro-government and moderate religiously-based parties, but did not appease the activists who progressively widened their attacks. Operations by the activists and the army resulted in nearly 100,000 deaths during the decade-long conflict. The government gained the upper hand by the mid-1990s and FIS's armed wing, the Islamic Salvation Army, disbanded in January 2000. Many armed militants of other groups surrendered under an amnesty program designed to promote national reconciliation, but small numbers of armed militants persist in confronting government forces and conducting ambushes and occasional attacks on villages. Issues facing the winner of the April 2004 presidential election include Berber unrest, large-scale unemployment, a shortage of housing, the presence of a group in the southern regions of the country that kidnapped European tourists in 2003, as well as the need to diversify Algeria's petroleum-based economy. Algeria assumed a two-year seat on the UN Security Council in January 2004. more

Economy
The hydrocarbons sector is the backbone of the economy, accounting for roughly 60% of budget revenues, 30% of GDP, and over 95% of export earnings. Algeria has the seventh-largest reserves of natural gas in the world and is the second-largest gas exporter; it ranks 14th in oil reserves. Economic policy reforms supported by the IMF and debt rescheduling from the Paris Club in the past decade have helped improve Algeria's financial and macroeconomic indicators. Because of sustained high oil prices in the past three years, Algeria's finances have further benefited from substantial trade surpluses and record foreign exchange reserves. Real GDP has risen due to higher oil output and increased government spending. The government's continued efforts to diversify the economy by attracting foreign and domestic investment outside the energy sector, however, has had little success in reducing high unemployment and improving living standards. Structural reform within the economy moves ahead slowly.