Algeria leader erases $520 million in farm debt

Weeks before his reelection bid, Algerian President Abdelaziz Bouteflika announced Saturday that the government would cancel hundreds of millions of dollars’ worth of debt owed by farmers and livestock producers, the state-run news agency reported.

Voters in the natural-gas-rich North African country go to the polls for the presidential election on April 9. Bouteflika is running for a third term, an option that parliament gave him recently by changing the constitution.

Speaking at an agricultural conference, Bouteflika said banks were required to stop efforts to collect debts owed by farmers and livestock producers totaling $520 million, the APS news agency reported.

“The state has decided to totally erase the debts of farmers and livestock raisers, and the public treasury will buy up these debts,” he said in the northeastern town of Biskra, according to APS.

The announcement came as part of a raft of measures aimed to benefit agricultural workers, including money for the construction of greenhouses, improvements on buildings used by livestock farmers, and aid for exporters of dates.

Algeria is largely unaffected by the global economic crisis because it has little financial or commercial ties to the rest of the world, a very small banking sector and no stock exchange. State-owned firms dominate the economy.

The country is 90% dependent on hydrocarbon exports, and concern is growing that oil prices driven down by the global crisis could make Algeria’s large state spending program unsustainable.

Algeria is the world’s seventh-largest natural gas producer and 14th-largest oil producer.

Parliament in November modified the constitution to end presidential term limits -- previously limited to two -- setting the stage for Bouteflika to seek a third mandate.

Many analysts say Bouteflika is a favorite to win. Most of the significant left-wing opposition and Islamists plan to boycott the vote, which they say won’t be fair.