Algerian tourism grant at its lowest level in 22 years

Algerians heading abroad during August were shocked to receive no more than 100 Euro tourist grant, compared to 15,000 Algerian dinars, the lowest figure ever since it was set in 1996 against the Algerian dinar, 22 years ago. This new policy was met by widespread disapproval, mainly since this value is usually spent abroad for one day only. Meanwhile, many Algerians are forced to resort to the black market for the acquisition of Euros costing them 215 dinars for the single euro, with an increase of 70 per cent of its price.

The financial and economic expert Kamal Si Mohamed said in a statement to Echorouk newspaper that the decline in the value of the tourist grant is due primarily to the devaluation of the Algerian dinar. At the beginning of August one Euro was equivalent to 141 Algerian dinars; however, currently, one euro has reached 137 Algerian dinars. The Euro’s price was comparable only to 89 dinars by the date of its inception in 1999. This leads every time to a significant deterioration in the value of the tourist grant for travellers abroad and resulted in such a decrease in August.

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The same expert asserted that the exchange rate of banks is not the same as the tourist exchange rate, to which the tourism margin is added. Such addition is the reason behind the decrease in the value of the grant that Algerians travelling abroad complained about, knowing that this margin is usually equivalent to 10 per cent of the total amount of such grant. Although the Governor of the Bank of Algeria Mohamed Loukal ruled out any subsequent increase in the value of this tourist grant in light of the current economic and financial situation, characterised by low oil prices and the decline of savings of the treasury in foreign currency, he stated that raising the tourism grant is urgently needed. The governor was also curious about the secret behind the Algerian bank’s method in counting the grant’s value in dinars even though the Algerian Dinar today has not the same amount it had in 1996, in addition to the need to take into account the high inflation rate.

The same official explained that the existence of foreign currency black market in Port Said Square in the Algerian capital and other black markets is one of the reasons that compelled the Bank of Algeria not to raise the grant’s value, as it is not appropriate to waste more of Algeria’s savings of foreign currencies and transfer them towards other countries.  Those who wish to go abroad can purchase Euros from the black market at 215 dinars, unlike the rates employed by commercial banks which are much cheaper. However, many patients travelling abroad for treatment and students heading to study outside Algeria find themselves in an embarrassing situation.

The Governor of the Bank of Algeria, Mohamed Loukal, told the deputies of the National People’s Assembly that the increase in the value of the tourist grant is not currently being considered.