Date Published: Friday, November 22, 2024
Category: Economy
Algeria’s Secretary General of the Ministry of Knowledge Economy, Startups, and Microenterprises, Nassima Arhab, emphasized the importance of diversifying financial support mechanisms for startups. Speaking in Algiers, she noted that while the National Fund for Startups has played a pivotal role in financing these enterprises, broader investment avenues must be introduced, involving both public and private investment funds.
The Role of the National Startup Fund
“The fund has been the sole mechanism for financing startups in Algeria since the establishment of the ministry,” Arhab stated during the 15th edition of the “Digitization Forum,” organized by the Algerian Collective for Digital Actors in partnership with Algeria Telecom. Despite its exceptional efforts, the fund alone is insufficient, Arhab added, not because of its structure but due to gaps in the overall startup ecosystem.
Established in 2020 by six public banks, the National Startup Fund operates as a venture capital firm aimed at addressing the lack of private funding—a key obstacle for young entrepreneurs globally. The fund focuses on financing the early stages of startups, including their launch and development, by acquiring equity stakes in these ventures.
However, Arhab stressed the need to integrate additional actors into the funding landscape. “Diversifying investment funds to involve both public and private sectors is essential to support startups at all stages of development and to meet the growing demand for financing in Algeria,” she said.
Beyond Financing: Expertise and Specialization
Arhab underlined the importance of providing startups with not just financial backing but also specialized expertise and guidance. Investment funds, particularly those with sectoral focus, must direct resources toward high-value-added projects, she explained.
Accelerating Algeria’s Startup Ecosystem
Minister of Knowledge Economy, Startups, and Microenterprises, Nourdine Wadah, highlighted the need for Algeria’s startup ecosystem to enter an “acceleration phase.” Speaking via video conference, Wadah emphasized that this phase requires contributions from all stakeholders, including private sector players, whose role is critical.
“Entrepreneurs, investment funds, and universities must work together to build a more efficient ecosystem that positively impacts Algeria’s national economy,” the minister said.
Economic Contributions and Opportunities
The head of the Algerian Collective for Digital Actors, Abdelwahab Kaoua, pointed to the significant economic potential of startups and small enterprises. In some industrialized countries, these businesses contribute up to 60% of GDP. In Algeria, however, their current contribution stands at around 20%, indicating substantial room for growth.
“This 20% share represents an opportunity for entrepreneurs to invest in startups and microenterprises, driving national economic growth,” Kaoua noted. He further emphasized the role of local companies in ensuring digital sovereignty and fostering sustainable economic growth.
A Call for Collaboration
Kaoua also urged stakeholders to seize opportunities presented by the ongoing global digital revolution, positioning Algeria at the forefront of this transformation. “Collaboration is key to unlocking the potential of this digital shift and ensuring Algeria remains a leader in the region,” he concluded.
For more insights into Algeria’s economic developments, visit DZWATCH.DZ.
Author: Nor-Eleslam
Algerian startups, funding diversification, National Startup Fund, digital economy, entrepreneurial ecosystem
