Algeria is slamming the brakes on money leaving the country, and it's not subtle about it. The government is watching every dollar, every dinar, every crypto transaction like a hawk circling prey.
Algeria monitors every financial movement with predatory intensity as foreign reserves collapse and capital flight accelerates beyond control.
Why? Because the country's foreign exchange reserves have nosedived from nearly $200 billion in 2014 to just $45 billion by the end of 2024. That's not a decline. That's a financial cliff.
Capital flight has become such a problem that authorities are pulling out all the stops. Fraudulent import schemes are everywhere. Over-invoicing, fictitious imports, customs evasion—you name it, someone tried it. These schemes drain reserves faster than anyone can track, so the Ministry of Foreign Trade launched thorough control campaigns to purify trade channels. Import licenses in electronics, agri-food, and pharmaceuticals are getting suspended and revoked. The Bank of Algeria is scrutinizing import bank transfers with microscopic precision.
Then there's cryptocurrency. Algeria just banned it. Completely. Law No. 25-10 doesn't mess around. Trading, mining, using, promoting, advertising—all illegal now. Get caught and you're looking at two months to a year in prison plus fines between 200,000 and 1,000,000 dinars. Link it to organized crime or terrorism? Those penalties escalate fast. The law aligns with international anti-money laundering standards and Financial Action Task Force norms, but it's also Algeria saying it prefers a tightly controlled monetary system over financial liberalization. The ban even extends to cryptocurrency mining, shutting down both commercial operators and individual hobbyists.
Foreign investment isn't getting a free pass either. The infamous 51/49 requirement remains intact, capping foreign ownership at 49 percent. The government defends this as protecting Algerian businesses and strategic sectors like banking, energy, and telecommunications. Recent mining law reforms removed some foreign ownership caps, but only selectively. The message is clear: we'll take your investment, but on our terms.
Even regular citizens feel the squeeze. Currency restrictions allow travelers to exchange just 750 euros per adult and 300 euros per minor. That's markedly below what neighboring countries permit. The dinar depreciated 15 percent against the euro in 2024, so authorities aren't taking chances with speculative outflows. Similar to how South Africa's Reserve Bank manages cross-border capital flows, Algeria's central bank maintains strict oversight to prevent unauthorized fund movements. Morocco's Bank Al-Maghrib employs comparable intervention strategies to manage the dirham and stabilize its own foreign exchange position.
Algeria's entire strategy revolves around stopping structural trade deficits and currency depreciation before they spiral out of control. The approach is defensive, cautious, and frankly exhausting for anyone trying to move money legally or otherwise. Volatile oil prices and weak non-hydrocarbon exports have compounded the economic pressure, making reserve protection increasingly urgent.
But when reserves drop by three-quarters in a decade, subtlety isn't an option. Algeria is circling the wagons, and everything outside those walls is suspect.
