Algeria Has Replaced Long-serving Central Bank Governor Mohamed Laksaci

Algeria replaced long-serving central bank Governor Mohamed Laksaci, after he was disparaged for his performance during the plunge in oil prices that damaged the country’s finances. Mohamed Loukal, former head of the Banque Exterieure d’Algerie, assumed the governorship during a ceremony in Algiers on Thursday, a central bank spokesman said by phone. Laksaci had been at the helm since 2001.

While other oil exporters in the Middle East relied on spending cuts and kept their currencies stable as revenue slumped, Algeria let the dinar weaken by about 30 percent since 2014 and maintained generous subsidies in an effort to prevent political protests. While a weaker currency was supported by international bodies including the International Monetary Fund, the decision proved deeply unpopular at home.

So far, authorities have filled the external funding gap by drawing on its reserves, which fell to $143 billion in 2015 from $192 billion two years earlier, according to the IMF. The government has also introduced import restrictions and is planning a 9 percent cut in spending in 2016. It started issuing debt this year as part of broader measures to help reduce its oil dependence.

via Bloomberg