AI in Algeria: insights & practical implementation strategy

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Welcome to the Tech A newsletter DeepDive
I've recently spent a week in Algeria finalizing TuraLabs' expansion alongside our UAE office. During this time, I met with over 20 business leaders and entrepreneurs to discuss AI's potential in the country.

In this short article, we'll explore the local context and key challenges & infer (pun intended) the opportunities I see in the short to long term.

Economic & Social Context: A Young, Growing Market

Algeria has immense potential for economic growth, demonstrated by its 4.1% annual GDP growth, 71% of the population already using the internet, and rapid digital adoption (ref).

The country's greatest asset lies in its young talent pool. About 40% of the total population is below 24, and the country produces approximately 30,000 engineering graduates annually. These graduates are already making their mark in the global tech industry thanks to remote work democratization. While recruiting for our AI team, I've encountered a few who already earn +2000 USD/month as freelancers for US companies, significantly higher than the local "high-end" average engineering wage of 400 USD/month.

Digital sectors like E-commerce are already booming, with an expected compound annual growth rate (CAGR) of 14.1% (vs. 7.6% global average) (ref). However, the true potential is still untapped, as most transactions happen with cash on delivery.

Government & support initiatives:

In the past 2 years, the government has taken significant steps to support AI development, such as:

• The AI Council, established in June 2023, unites experts from government, industry, and academia (ref)

• "The National Artificial Intelligence Strategy Conference" in December 2024 defined a detailed road-map

• The AI Action Plan focuses on six pillars: scientific research, talent attraction, hardware investment, investment promotion, data protection, and sector-specific AI strategies (agriculture, healthcare, and cyber-security)

• By 2026, Algeria Digital Strategy 2030 aims to implement 500+ digitalization projects, focusing on infrastructure, training, digital governance, economy, and society.

While the effectiveness of these strategies depends heavily on the execution, the trend is promising.

Challenges:

According to the "Government AI Readiness Index 2023" by Oxford Insights, Algeria ranks 120th globally in readiness for large-scale AI adoption in the public sector, scoring 35.99 out of 100. Which means it's still ramping up its digitization phase.

For the AI strategy to succeed, Algeria will need widespread access to strong digital infrastructure, such as data centers with cloud computing systems. Investments in local talent, modernizing digital infrastructure, and fostering innovation will also be critical to achieving the strategy's goals.

Legal and administrative constraints heavily limit the use of foreign digital infrastructure. The foreign currency reserve is declining yearly (from 193.6 to 63.6 billion USD in the last decade).

This makes it very hard for businesses and individuals to purchase foreign software assets such as software, API keys, cloud computing usage, etc.

Ground Realities From Business Leaders:

Once in Algeria, I wanted to confirm some assumptions by directly discussing them with business leaders and entrepreneurs in pharmaceuticals, marketing, e-commerce, and finance.

Here are my takeaways:

• Some Corporate government organizations are already considering investing in or developing their own AI solutions. I've seen them implemented (or being implemented) in insurance, banking, pharmaceuticals, and cybersecurity.

• Small to medium businesses show limited AI adoption potential

• Digital-focused companies and startups are embracing AI.

• With salaries as low as $150/month, Businesses mainly use AI to drive quality of service/product improvement and revenue growth.

• Young graduates understand AI's utility, and many are turning to AI freelancing for overseas clients.

• There is no significant GPU as a service infrastructure. However, there are some promising developments, like the Ooredoo Group announcement in 2024. They partnered with NVIDIA to deploy thousands of NVIDIA Tensor Core GPUs in their AI data centers across the MENA region, including Algeria (ref). Algeria's rollout date is still undefined.

My Strategy

TuraLabs is a global AI development agency, and we're already developing AI solutions for initial North American clients. We also want to leverage the presence of our Algeria office and consultants there to explore how AI can benefit businesses there TODAY.

Here is how I plan to adapt my approach to the Algerian market:

• Utilizing Algeria's tech talent pool to build solutions from ideation to PoC, partnering with early adopters for pre-international rollout refinement

• Focusing AI solutions on quality and revenue growth for the Algerian market

• Prioritizing automation for broader small business appeal

• Leveraging AI internally in self-owned businesses rather than direct AI sales. Whether you create a marketing agency, regulatory consultancy, or an E-commerce store, AI can give you a high competitive edge. Your client mainly cares about the value you provide (not the how).

• To address foreign currency challenges, we'll implement models locally using open source LLMs.

• When the government strategy materializes, we'll train, implement, and contribute to AI adoption. It's my bet for the future. Some bets are worth taking, whatever the results.

If you've read this far, you share my interest in Algeria's AI potential. Share this article and connect with me to continue the discussion.

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Amine Rabehi

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🔍 Whenever you’re ready, here are 3 things I can help you with:

• Technology Solution/Product consultancy: I help you assess your product idea from a technological & business point of view. So far, I have built a network of professionals covering the MENA region in term of IP, Market Research.

• Market entry strategy and support: understand the market, legal framework

• Tailored Smart Solutions (AI, Automation, Blockchain, IoT): with my team at TuraLabs, we help you assess where AI & other solutions can best provide value for your business (for free, not for long). We then build it for you.