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* Reflecting challenges of a lagging economy and innovation, Algerians have been slow in adopting the internet. Currently only 14% of the country’s inhabitants are connected; this figure has climbed to 51% and 39.1% respectively in neighboring Morocco and Tunisia. *

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Wamda, by Aline Mayard (May 7, 2014) — When I shared my plans of heading to Algeria to meet startups on Twitter I received puzzled responses, like one man who couldn’t believe someone would be interested in his country’s startups (or that they even existed at all). It is true that Algerians are developing an entrepreneurial ecosystem quite late compared to its neighbors. And it is hard to think of an Algerian startup or web-based company, successful or not. According to Yasmine Bouchène, an Algerian journalist specialized in startups and founder of media site AlHubeco, the only company that resembles a startup in Algeria is Ouedkniss, a classifieds website, and the only mobile services are media apps. Yet, despite the slow implementation of 3G and a expensive and hard to get broadband Internet, an increasing number of Algerians are using the internet, especially dating websites, classifieds platforms, and online media (of varying quality), and some Algerians are now working on interesting startup projects. So, where does this lack of innovation motivation come from, and what can we do to help overcome the challenges?

The economy in general is lagging behind

The civil war, whose outbreak in 1991 signaled the beginning of a dark period in Algeria’s history, impacted production, infrastructure, and consumption, slowing the country’s economic development to a crawl from which the country is just now emerging. Also, Algeria is led by an ageing elite, which does not help innovation. During my trip to Oran and Algiers, the country appeared to me in a bad state, almost abandoned at some time. Downtown Algiers, though, looks as good as ever. Reflecting these challenges, Algerians have been slow in adopting the internet. Currently only 14% of the country’s inhabitants are connected; this figure has climbed to 51% and 39.1% respectively in neighboring countries Morocco and Tunisia. That being said, 14% of the Algerian population represents six million web users, as some local entrepreneurs reminded me, and sub-Saharan African entrepreneurs are doing fine despite their own less-than-ideal economical situations. The main problem must be somewhere else.

A lack of funding

Launching a web startup takes time and money, two things that are not easy to come by in Algeria. Like in much of the region, banks are not much help, but unlike other regional countries, Algeria is lacking something else: aid from national and international organization supporting entrepreneurship. To launch their startups, entrepreneurs have to work on their startups in addition to their normal jobs, slowing down their capacity to launch their startup in good time. I’ve been saddened to see entrepreneurs, like Mustapha Lakhdari, founder of Goutra, a connected device that aims to help individuals reduce their water consumption, stuck in beta after two years of work. The inability to move quickly put startups at risk of losing their technological advantage. A few aid programs exist, like the ANSEJ (the National Agency for Supporting Youth Employment) which funds companies by allowing non-remunerated loans, and taking on part of the bank interests on loans contracted from private banks. But these programs aren’t enough to make a significant difference.

[Continue Reading at Wamda…]

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