Algeria faces evolving tensions around banking measures tied to foreign trade with Spain. ABEF, the national banking association, circulated information to banks and financial institutions stating that a previously issued order to freeze accounts involved in Spain-related trade payments was no longer valid as of June 8. The report originated with Algerian media, including TSA, and gained access to a copy through that channel. The Professional Association of Banks and Financial Institutions, acting as the employer for a government-backed, largely state-owned bank, appears hopeful that this communication will be supported at the highest levels of government. The aim is to facilitate the unblocking of Spain’s exports to Algeria, which last year approached 1.9 billion euros.
The July 28, 2022 letter addressed to bank and financial managers stated that measures freezing direct debits in foreign trade transactions with Spain were no longer applicable after careful review and consultation with actors involved in foreign trade. The document emphasized a shift in policy based on updated assessments of risk and trust among commercial partners.
A separate statement reported that the Bank of Algeria indicated direct debiting in foreign trade depends on the authorization of intermediary banks. The bank noted that it assesses structural risks, including counterparty credit quality and the measures needed to mitigate potential losses. This framework signals a move toward greater flexibility while maintaining risk controls in cross-border commerce.
These circulars followed shortly after Algerian customs officials sought clarification from the government on penalties related to Spain for transactions before June 8. The media outlet TSA described the situation as creating uncertainty for Algerian companies with ties to Spain.
Officials indicated that practical implementation on the ground remains unclear and that customs restrictions may still exist in certain cases. The note suggested that barriers to trade with Spain had been removed, even as policy shifts coincided with other government actions. The sequence included a suspension of a Treaty of Friendship with Spain, connected to ongoing debates over Western Sahara and related political statements in Europe.
In Brussels, Foreign Minister José Manuel Albares presented the commercial issue to the European Union, which holds competence over trade relations with countries like Algeria. A joint statement from the EU’s high representative for foreign affairs and trade leadership noted readiness to respond to coercive measures and to file formal concerns regarding any member state action affecting trade with Algeria. The development underscored a broader EU stance on maintaining stable trade relationships while addressing diplomatic tensions.
Around the same time, a high-ranking official within the European institutions signaled that the Algerian financial leadership remained subject to ongoing dialogue with Brussels. The aim appeared to be to monitor and adjust commercial events as circumstances evolved, rather than to freeze ties entirely.
Over the ensuing weeks, official statements from Madrid and Brussels were sparse. The focus remained on the cadence of daily diplomacy, with occasional appearances by the Secretary of State for Commerce in parliamentary settings. The consensus in the reporting suggested that trade with Algeria had been significantly affected, though efforts continued to keep channels open for important commercial activities with regional partners. The extent of the impact on ongoing business remained a topic of close scrutiny among industry observers.
Diplomatic relations between Spain and Algeria reached a standstill, with Algeria recalling its ambassador amid a shift in posture regarding Western Sahara. The embassy’s presence in Spain persisted at a lower, more discreet level as the political dynamics evolved and as both sides navigated a challenging period in their relationship.