Why Algeria Is Positioned To Become North Africa’s AI Leader

In the Middle East and North Africa, governments often pursue competing artificial intelligence strategies with limited success in implementation. Algeria’s comprehensive, multiyear AI plan demonstrates how sustained government commitment can address critical challenges in education and business development while fostering long-term stability.

By focusing on systematic deployment, sector-specific applications, and human capital development, Algeria provides a model for neighboring countries seeking to strengthen regional cooperation and avoid fragmented or isolated AI efforts. With AI development accelerating across the MENA region, Algeria pursues a distinct approach, using comprehensive AI strategy to reduce technological dependence on former colonial powers while building strategic autonomy.

Algeria’s AI Strategy

Algeria’s six-pillar AI strategy focuses on scientific research and innovation; skills development through education; sector-specific applications in health care, agriculture, and energy; investment promotion; data protection and governance; and building an AI ecosystem. Although Algeria is following a similar AI approach that focuses on regional infrastructure, some implementation methods differ. The UAE announced a National AI strategy in 2018 with a push for 2031. Saudi Arabia and Egypt have also adopted comprehensive multiple-pillar frameworks. Algeria’s multilateral partnerships, including with China, Italy, France, and the United States, gives it an advantage.

U.S. strengths lie in AI and frontier modeling development research and development, a process that revolves around creating cutting-edge, foundational models and generative architecture. China’s approach involves significant state coordination of its technology sector, balancing government oversight with private sector innovation. Europe, meanwhile, emphasizes responsible AI through regulation, an approach some credit with protecting consumers while others cite as constraining growth. As the Brookings Institution notes, the EU AI Act establishes a legally binding, EU-wide regulatory framework for general-purpose AI, in contrast to the United States, where no comparable federal law applies, and AI governance remains diffuse and sector-specific.

Algeria strategically plays France, China, Italy, and the U.S. against each other to avoid dependence on any single power. This hedging establishes Algeria as a strategically autonomous actor, making it an attractive partner for countries seeking to engage North Africa without choosing sides in great power competition.

Algeria’s AI market is projected to grow from $498.9 million in 2025 to $1.69 billion by 2030, a 27.67% compound annual growth rate. The strategy emphasizes AI deployment across Algeria’s most economically significant areas. For example, AI will be used to modernize agricultural practices through smart farming given the sector’s 12.4% GDP contribution, improve efficiency in oil and gas operations where Algeria maintains regional leadership, and create AI-based services designed for international export markets.

Evidence of Success

Investment Infrastructure

In 2025, Algérie Télécom invested 1.5 billion dinars (approximately $11 million) to fund AI, cybersecurity, and robotics startups. This investment complements broader digitalization efforts covering over 500 projects planned for 2025-2026, creating a comprehensive funding ecosystem for AI development.

Why This Matters Strategically

The country possesses Africa’s strongest computer science educational foundation, with 57,702 students enrolled across 74 AI master’s programs in 52 universities. Algeria also ranks among the top five African countries for recognized scientific publications and maintains researchers among the top 2% of scientists globally.

Algeria’s geographic position between Europe and sub-Saharan Africa, combined with substantial energy resources, creates unique opportunities for regional AI hub development. As neighboring countries struggle with limited technical capacity, Algeria’s human capital advantage could translate into lasting regional influence.

Algeria’s AI investment strategy requires substantial upfront costs but offers significant economic returns. Human capital development costs are estimated at $550 million to $850 million, covering AI education infrastructure expansion, professional training programs, and initiatives to address the brain drain crisis that has weakened the economy. The government aims to train 500,000 ICT specialists by 2030, representing a dramatic scaling of current capacity.

Enhanced efficiency in Algeria’s oil and gas sector could deliver annual cost reductions worth $200 million to $300 million. Precision agriculture improvements could increase yields by 20 to 25%, creating $800 million to $1.2 billion in value by 2030. Non-hydrocarbon exports, currently valued at $5.1 billion, could double through manufacturing and services optimization.

Geopolitical Maneuvering

France’s Long-Term Relationship with Algeria

The old adage, “the Arab reigns but the French governs,” long captured the imbalance that defined Franco-Algerian relations. In February 2025, tensions reignited between the French and Algerian governments, underscoring the fragile balance that defines their long-standing relationship. The political and cultural delicacy between the two nations runs deep as over 10 percent of France’s population has direct ties to Algeria, including an estimated 900,000 dual nationals. The legacy of more than a century of colonial entanglement continues to shape both domestic and foreign policy decisions, often producing unpredictable diplomatic behavior; neither side seems fully prepared to manage.

The most recent dispute centers on three prominent issues: the conflict in Libya, tense relations with Morocco, and stabilization of the Sahel. From a geopolitical standpoint, Algeria functions as a critical intermediary between France and northwestern Africa, especially in energy, technology, and trade relations. France, meanwhile, remains intent on maintaining its regional foothold, recognizing that Algeria’s position in the Sahara corridor offers strategic value for access to both African and Mediterranean markets. Should this connection weaken, Paris risks losing not only a key security and energy partner but also one of its final anchors of influence in the Maghreb.

Constant bureaucratic cycles emerge, which leads to political stagnancy. In April 2025, there were diplomatic strategy meetings as European officials focused on Franco-Algerian relations and the recent rise in diplomatic tensions. French Foreign Minister Jean-Nöel Barrot and his Algerian counterpart, Ahmed Attaf, laid groundwork for a new phase in cooperation, in line with the objectives outlined by both countries’ presidents in the 2022 Algiers Declaration.

All North African countries have developed a “Sovereignty First” approach. Russia’s diminished role as a key gas supplier to the EU opens space for other suppliers to step up. Europe’s moves away from Russian gas since 2022 strengthens Algeria’s pipeline and LNG infrastructure as a tool for regional energy diplomacy, increasing its influence with the EU and U.S. This demonstrates Algeria’s strategic autonomy: The country retains the capacity to cooperate with Ukraine or other partners, asserting its independent role in regional and global affairs.

Algerian Skepticism of French Involvement

Amid shifting tensions, Algerian citizens have grown increasingly skeptical of French policy implementation in the country. This realignment has caused friction with French officials, more notably as Algeria increasingly turns to China and Italy to advance its AI and digital infrastructure ambitions. Italy and the Algerian regime have focused on key sectors such as 5G, undersea cables, and cybersecurity. In July 2025, Algeria and Italy signed a memorandum of understanding on telecommunications infrastructure, and Algérie Télécom partnered with Italian service provider Sparkle to develop a new submarine cable linking Algeria to Italy. Algeria is also participating in the Medusa Submarine Cable System, an 8,760-kilometer (5,443-mile) network connecting North Africa to Southern Europe with 342 million euros in investment. Cooperation in this context gives the Algerian government the flexibility to be independent without strong colonialist influence through enforced tactics of the French government.

Among youths and within the educational sector, language preferences are shifting dramatically. French was once dominant, but the Ministry of Higher Education recently conducted an online poll to gauge support for using English as a medium of instruction. Of the 94,060 participants, 94.3 percent endorsed the proposal. This shift reflects a subtle form of sovereign diplomacy. Algeria positions its students for opportunities such as advanced U.S. degrees while simultaneously strengthening diplomatic engagement with potential allies like the United States.

In November 2024, Algeria’s National Higher School of Mathematics and National Higher School of Artificial Intelligence formalized partnerships with the University of Notre Dame, creating frameworks for research collaboration, academic exchanges, and mentorship programs preparing Algerian doctoral candidates for study in the United States. The U.S. Embassy in Algiers funded these initiatives as part of sustained bilateral engagement in scientific cooperation

China’s Algerian Engagement

China’s relationship with Algeria dates to at least 1955’s Afro-Asian Bandung Conference. In 2019, China’s exports to Algeria totaled $7 billion, while Algeria’s exports to China reached $1.2 billion.

In May 2024, Algeria and China signed the Digital Economy Cooperation Deal. Beginning in September 2026, the initiative will provide vocational trainees with high-quality instruction in cloud computing, cybersecurity, and AI, culminating in a diploma jointly issued by the Ministry and Huawei. Given the commendable R&D capabilities Huawei holds, it was able to train 8,000 Algerians, further achieving measurable gains in applied technical proficiency, while also expanding training capacities at three regional universities.

On July 18, 2023, Algeria and China signed a memorandum of understanding to establish the China-Algeria Joint Laboratory for Artificial Intelligence. This allows for China to use a diplomatic approach, facilitating partnerships between each respective region.

The Manufacturing Reality

In relation to infrastructure development, Algeria’s Digital Economy Cooperation Deal with China represents significant investment, but Huawei’s existing operations provide important context. Carnegie Endowment research on Huawei’s operations in Algeria and Egypt found the company “improved its brand image without engaging in meaningful capacity building.”

Huawei opened its first African factory in Algeria in 2019, employing 140 Algerian citizens. However, the facility relied on imported Chinese components, a practice Algerian officials referred to as “fictitious production.” When Algeria banned these imports in January 2021, the factory was closed and the workers were laid off. Carnegie found “training was limited to the installation and maintenance of Huawei products,” while ”high-level positions within the firm remained off-limits to locals.”

Strategic partnerships with the United States are on the horizon with the integration of English language and the placement of Algerian students in U.S. universities. English provides access to U.S. universities, Western tech companies, and alternative partnership models beyond Chinese infrastructure alone.

Challenges

The country faces limited data center storage capacity. Constant investment with no regulation would mean a technological bubble would lead to eventual collapse. Focusing on the most strategic, long-term investments would be well-suited for the country’s current infrastructural position. Algeria sits on unbalanced terrain, causing connectivity problems that affect 27.1% of the population. In 2023, 76.9% of Algerian citizens used internet-based services. This amounts to 10.4 million people remaining offline during the period. Addressing connectivity gaps in rural and interior regions will be a prerequisite for scaling AI-enabled services and digital infrastructure nationally.

Because of the constantly evolving nature of AI and the fact that Algeria just launched its investment plan, a skillset gap exists. Algeria ranked 120th out of 193 countries for AI readiness in an Oxford Insights study, but that ranking captures present-day infrastructure and deployment, not educational capacity or future potential. Algeria’s strategy deliberately prioritizes building this human capital foundation first, positioning the country to systematically scale implementation as graduates enter the workforce.

The Algerian Chamber of Commerce and Industry has a nontransparent and inefficient decision-making process, according to a U.S. State Department analysis. Aside from Algeria’s strength in the AI sector, it needs need to create strategic pathways that don’t stagnate when their allies in the tech sector make quicker moves.

Conclusion

Algeria demonstrates that determined governance combined with emerging technology can deliver rapid, visible transformation. The Middle East cannot delay the adoption of comprehensive AI strategies without deepening the region’s technological divide and leaving late adopters vulnerable to external dependence. The region already faces widening gaps in agricultural productivity, health care access, and education. Without coordinated action, these divides will harden into long-term structural inequalities.

Regional governments now face a clear choice: They can continue to pursue fragmented, short-term policies, or they can commit to cohesive, adaptive frameworks that promote collaboration, resilience, and sustainable influence in the global economy. Algeria knows the potential it holds. Over time, key players such as China, Russia, and the United States will see a use of tactical diplomacy from Algeria, establishing itself as the leading voice in the Maghreb and Sahel.

Policy Recommendations

While this analysis focuses on Algeria, the following policy recommendations are intended to inform broader AI governance and implementation efforts across North Africa.

The views expressed in this article are those of the author and not an official policy or position of New Lines Institute.