Spain accuses Algeria of cutting almost all trade ties

Spain on Thursday accused Algeria of blocking almost all bilateral trade operations except for gas exports following a major diplomatic spat linked to disputed Western Sahara.

Earlier this month, Algeria suspended a cooperation pact with Spain, prompting a terse rebuke from Brussels which warned there would be consequences for any “discriminatory treatment” of an EU member state.

At the time, Spain expressed concern after a key Algerian banking association urged its members to restrict business ties, but Algeria’s diplomatic mission to the European Union pooh-poohed the idea as a Spanish fabrication.

“The alleged measure by the (Algerian) government to stop ongoing transactions with a European partner… only exists in the minds of those who claim it and of those who hastened to stigmatise it,” it said at the time.

But on Thursday, Spain’s top diplomat confirmed there had been a de facto halt to trade ties.

“Despite Algerian statements saying these were malicious fantasies dreamt up by Spain, there is indeed a blocking of operations,” Foreign Minister Jose Manuel Albares told RNE public radio.

His remarks came a day after Secretary of State for Trade Xiana Mendez told a Spanish parliamentary commission that Algeria had halted almost all foreign trade.

“In practise, we have seen an almost total paralysis of all trade operations with Algeria, both imports and exports, with the exception of energy products,” she said.

“What we are seeing is a de facto freezing of trade flows in both directions. We see this as a breach of the association agreement signed between Algeria and the EU.”

– ‘Spain will defend its interests’ –

Despite the tetchy exchanges earlier this month, Algeria had confirmed it would continue to honour its gas-supply contract with Spain. In the first quarter of 2022, it supplied about 25 percent of Spain’s gas imports.

Albares said Spain would defend its interests “with absolute determination”.

“Every time we see that operations are being blocked, we inform the (European) Commission, which is seeking explanations from Algeria,” he said.

When the issue of trade ties first arose earlier this month, EU foreign policy chief Josep Borrell said Brussels was reaching out to Algeria to clarify the situation and made clear the bloc was “ready to stand up against any type of coercive measures applied against an EU member state”.

On June 8, Algeria suspended its 2002 friendship treaty with Spain and its banking association then urged members to restrict business ties.

The move came after Madrid reversed its decades-long stance of neutrality on the Western Sahara conflict, saying it would back Morocco’s autonomy plan for the disputed region in order to end the lingering diplomatic spat.

Spain’s U-turn, which was widely seen as a victory for Morocco, infuriated its regional rival Algeria, which has long backed the Polisario Front, Western Sahara’s independence movement.

Last year, Spanish exports to Algeria totalled 1.8 billion euros ($1.95 billion) while imports amounted to 4.7 billion, almost all of which was gas supplies.