The regional economy faces a volatile mix of shocks. The coronavirus crisis, the war in Ukraine, rising energy costs and the surge in raw materials already stretched budgets. Now the Algeria–Spain diplomatic rupture adds a new layer of uncertainty. The provincial business community in Alicante responds with a blend of worry and frustration as the conflict hovers over trade the year exports reach 135 million euros since the start. Key sectors like metals, textiles, footwear, and food are among the hardest hit. Business leaders have urged the Government to take swift diplomatic action to secure a prompt resolution. Economy Minister Rafa Climent has called on the central government to convene regional authorities to report on the expected impact of this new development.
Algeria’s suspension of the friendship treaty with Spain over its stance on the Sahara, and the resulting freeze in banking markets, is forecast to affect Alicante in particular because of its long history of trade with the North African nation.
A report by Carlos Baño, vice-president of the Alicante Chamber, shows that exports to Algeria account for 2.2% of total provincial shipments, ranking the country eleventh among import destinations. In product terms, consumer goods make up 29.7%, semi-finished goods 18.4%, capital goods 17.5%, food, beverages and tobacco 10.9%, and durable consumer goods 5.7%. Sectoral leaders include metals, textiles, footwear, food and plastics, which drive the highest sales volumes. Algeria also takes roughly 60% of provincial exports, along with substantial shares of mobile phones and white goods, and about 16% of clothing sales.
Imports total around 21 million euros. The top entries are fish, crustaceans and mollusks, along with fertilizers and edible fruits, reflecting the province’s diverse supply chains.
The business community reacts with a sense of disgust and anxiety about what lies ahead. The mood was palpable at the Benidorm Tourism Conference, where industry officials gathered this Thursday. Salvador Navarro, president of the Valencian Business Confederation (CEV), warned of immediate regional economic effects and a longer-term rise in Algerian gas prices. He urged urgent diplomatic moves to reach a quick solution. [Cited: Salvador Navarro, President, Valencian Business Confederation]
Juan Riera, head of the Chamber, described the 135 million euros in export value as a modest figure and noted that companies with Algerian interests face deep uncertainty. José Vicente Morata, chairman of the Valencian Community Chambers Council, lamented that 1,300 regional firms selling to Algeria, worth about 440 million euros, could suffer a significant blow to their operations.
The metal sector, including machinery and electrical appliances, emerges as one of the most concerned. Luis Rodríguez, president of Alicante businessmen, called the situation an external problem that Spanish firms did not anticipate. David Beltrá, leader of the province’s marble industry, highlighted that the region exports blocks and engineered stone from the Vinalopó area, a development that does not portend good news.
Pepe Serna, head of Ateval, the textile employers association, noted that the diplomatic shift stems from changes in government strategy. Marián Cano, president of Avecal, the Valencian footwear group, remarked that despite Algeria’s absence, the market environment is hard to read, especially when natural gas supplies are critical. The conflict among top destinations risks slowing the economic recovery.
On the tourism front, Nuria Montes, general secretary of Hosbec, added that Algerian visitors account for roughly 2% of total tourism activity. While small, this share introduces additional uncertainty. Jesualdo Ros, secretary of Provia, cautioned that declines in new housing purchases may be modest, yet the general uncertainty does not help the market. Carlos Baño, president of Facpyme, admitted the lack of Algeria-based clients, but warned that the broader economy would feel the impact.
A separate analysis by Ineca, the provincial Economic Research Institute, indicates that Alicante’s direct trade with Algeria totals about 6.2 billion euros in external sales, while also pointing to collateral effects on other provinces whose products enter Alicante’s market. [Source: Francisco Llopis, Research Director, Ineca]
Economy Minister Rafa Climent echoed the concern, calling on the central government to coordinate with other communities to clarify the situation. Valencian companies face a climate of uncertainty due to the diplomatic crisis with Algeria, and Climent emphasized the need for a precise understanding of the real state of affairs.
Communications with Algeria appear strained. Flights to Oran and Algiers have stalled, and the maritime link is affected as well. The Alicante–Elche airport had hoped to resume routes after the worst of the pandemic, but the present diplomatic crisis has halted those plans. The government recently halted plans to restore a regular ferry service to North Africa, and the same hesitation applies to post-Covid maritime routes.
Baleària, the operator with an existing connection to Algeria, reported that about 5 million euros were held in the Algerian accounts following the decision to stop banking exchanges. The funds relate to passenger traffic between Valencia and Mostaganem, with two weekly routes in each direction. The amount also covers summer cruise presales, contingent on the currency and diplomatic trajectory. Baleària’s president, Adolfo Utor, confirmed that the line could remain viable, with the next ship scheduled to depart Valencia carrying hundreds of passengers. Before the pandemic, the fleet operated seven weekly trips to Algeria from Valencia and Barcelona, but the current crisis has complicated those plans. [Cited: Adolfo Utor, President, Baleària]
In sum, regional leaders stress the need for pragmatic, rapid diplomacy to stabilize trade flows and energy supplies while minimizing the knock-on effects across manufacturing, tourism, and housing markets. The situation remains fluid, with industry voices urging a clear-eyed plan and prompt action to safeguard economic momentum in Alicante and beyond.