- Title: ALGERIA: Swiss investors venture into retail sector
- Date: 10th August 2010
- Summary: MORE OF PEOPLE
- Embargoed: 25th August 2010 13:00
- Keywords:
- Location: Algeria
- Country: Algeria
- Topics: Finance
- Reuters ID: LVA74TQ2XY4DBY71SNAMXN7OBFC9
- Story Text: Swiss investors unveiled Algeria's first Western-style shopping mall last week, a 70-million-euro project that marks the first major foray by foreigners into the energy exporters' untapped retail market.
Algeria has 35 million people and one of the highest levels of income per capita in Africa but international retailers have been put off by curbs on foreign investment and a conflict between government forces and Islamist rebels.
A joint venture of Swiss banking group Valartis and Swiss department store operator Jelmoli financed the shopping mall, recreation and office complex in the Algerian capital and said it plans two more worth 80 million euros.
Lebanese investor Gaby Melki said there was an opportunity for entrepreneurs in the country.
"I chose Algeria because I wanted to invest outside Lebanon and I started thinking where I would go. The missus said I could work in all the Arab countries around Lebanon like Dubai, the rest of the Emirates, Qatar, Egypt and then you have the Arab Maghreb Tunisia and Morocco, all of which had everything like leisure (facilities), restaurants. I found that Algeria was a large country and had the potential for us to carry out all these projects, and it was because of this I chose Algeria," he said.
Melki has invested in a multiplex cinema, shops and a bowling alley which are scheduled to open later this year.
But Melki says some investors may be discouraged by difficulties in an economy leaning towards nationalism.
"Algeria is a difficult country because they use all the French laws and implements them in detail. It has a lot of bureaucracy as they say, it's heavy. Nothing is easy in Algeria."
The previous attempt by a foreign retailer to break into Algeria's retail market was when French retailer Carrefour launched a franchise project with a local partner. It pulled out at the end of last year.
"It is a good thing as we really needed a place like this, we have a huge choice for ourselves and our children and we hope these kind of leisure malls can be built across Algeria," said Maliki, a shopper.
"It's good to have this in our country because it's better than going to other countries to look for these kind of malls," said Issma, another shopper.
Most Algerians shop in small neighbourhood stores or markets and there are almost no foreign retail brands. Many fast-food outlets have added the prefix "Mc" to their name in a nod to McDonald's restaurants -- which has no presence in Algeria.
"It's the best thing they have done in Algeria among all the new projects. I am very happy, it's very nice, the interior decor is wonderful," said Yaqoub, whilst picking through products at a clothes shop.
The chairman of Societe des Centres Commerciaux et de Loisirs d'Algerie (SCCA), the joint venture behind the mall, said it was planning another complex in Algiers and one in the western Algerian city of Oran.
Some shoppers said the new mall was a place to spend leisure time.
"I like this mall, it's a place of entertainment, there are many attractions so people come here to relieve daily pressures and relax," said Amal.
The Swiss investors began their project in Algeria four years ago, as Algeria began to emerge from more than of a decade of violence that killed an estimated 200,000 people.
The violence has eased in the past few years after hundreds of rebels surrendered to the authorities, though al Qaeda-linked militants mount occasional attacks outside the major cities.
Investors hope to capitalise on improving security. Algerian authorities say measures restricting foreign investment are intended to protect national interests. - Copyright Holder: REUTERS
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