Mini budget to face inflation in Algeria

The Algerian government drafted a mini budget on July 31 for the next 5 months to meet inflated state expenditure, the cabinet said.

A statement in the official Algerian newspaper Al Watan said the increased spending on top of the original 1997 budget stemmed mainly from pay rises for government workers and pensions, along with payment of debts to state-owned firms and the cost of holding local elections.

"It is an important step to draw a mini-budget text due emergence of new expenditure started from the beginning of the year," the cabinet said.

It said also that extra state expenditures did not swell the budget deficit because Algeria had additional income from higher world oil prices than it had originally forecast. The cabinet said the government had based the budget on a conservative oil price of 17.50 US dollars a barrel, but Algerian Guide had earned more than that.

The government draws more than half of its budget from oil and gas taxes.