Algeria: on the Brink Of Government Crisis

THE recent assassination of Kasdi Merbah, a former prime minister, outside of Algiers constitutes yet another troubling development in Algeria's slide toward instability. It is unclear who was behind this latest act, even though the Islamic movement is a suspect, according to the government.

Adding to the confusion, Belaid Abdesslam was removed as the country's prime minister and replaced by Redha Malek. But this latest change at the top will not help the country. What is needed is a bold move forward on both the political and economic fronts. Unless this occurs, Algeria seems likely to plunge into chaos, with political implications far beyond its borders.

The first major issue that the country needs to address relates to the deadlock in the political situation of the country. Clearly, a decision needs to be made soon about how to proceed. Last May, Ali Kafi, head of the High Council of State, promised a referendum at the end of this year. He was vague, however, about the nature and purpose of the referendum. This appears to reflect either a serious division at the top or total confusion on the part of the leadership as to how to deal with the crisis.

Even before the national elections, some members of the Majlis Ashura (consultative council) openly expressed their disagreement with the top leadership of the Islamic Salvation Front (FIS). Finally, a more aggressive group from within the Islamic movement, the Armed Islamic Movement, or MIA, appears to operate independently of the core of the FIS. It is unfair to conclude that all FIS supporters agree with the violent methods used by the MIA.

Nevertheless, the group is there and something needs to be done to defuse the situation.

An Algerian newspaper, L'Hebdo Libere, alleges that soon after the cancellation of national elections in January 1992, Iran targeted Algeria for a violent antigovernment campaign. The objective, according to the same paper, was to destabilize the Algerian government.

Though both Iran and Sudan have helped foment unrest in Algeria, the rise in Islamic fundamentalism in Algeria is a home-grown phenomenon. Without initial popular support from within the country, the two countries would not have been able to do much. It is equally important to note that an answer to the current Algerian crisis needs to come from within. The rise of the FIS would have occurred regardless of what Iran or Sudan did.

The authorities need to decide if a dialogue with the FIS is worth pursuing, and under what conditions. During a transitional period, a government of national unity comprised of members of all the major parties could be formed (without excluding the FIS). But, ultimately, free elections need to take place with the understanding that, should the FIS, for example, get to power, it cannot alter or amend the constitution in order to turn Algeria into an Islamic state and abolish the multiparty system.

This may go a long way toward ensuring that commitment of the FIS to democracy is not one election deep. Such a scenario was apparently considered by the authorities prior to the canceling of the elections in January of last year, but the risks were deemed too great.

The second major issue that the government needs to address is economic, but it cannot do so until the political situation is resolved. Bankers, potential investors, and multilateral institutions would prefer to see some political stability before they commit to a serious economic package. Given that poverty, unemployment, lack of housing, and other conditions abetted the rise of Islamic fundamentalism, it seems logical to search for solutions that would address these economic ills first. At the moment, the Algerian government has no clear program of economic reform to address these problems.

The only way out of this economic quagmire is a shock-therapy approach. It is no service to delay the necessary legislation to have the government sell most of the public sector to the private sector and open the economy to foreign investment, regardless of its source and the sector in which it is used. Foreign capital ought to be looked at as complementing domestic resources, not competing with them. Besides, since Europe has effectively closed its doors to immigration from North Africa, Algeria does not have much choice in the matter. It is impossible to continue to rely on more borrowing from foreign banks when the debt service is already choking any future economic growth prospects.

If the Algerian authorities decide to adopt a shock-therapy approach similar to that of Poland, European companies could be the first to benefit by setting up shop in Algeria.

The above proposals can only work if there is a complete commitment to follow through on both the political and economic fronts. Failure to do so would further worsen the outlook for Algeria and may, in the end, push the country to the brink of a civil war.