Is there new hope in Algeria?

The surprise resignation of Algerian President Abdelaziz Bouteflika after weeks of popular protests has raised hopes that genuine democratic change could be coming to the country. While his fall is certainly an important development, all signs indicate that the power brokers in Algeria have learned the lessons of the Arab Spring and are embarking on a crisis management campaign designed to shore up the status quo.

Like a number of its autocratic neighbors, Algeria is managing this crisis in light of the lessons of the Arab Spring, but without instituting genuine reforms. As the first Arab Spring country to undergo a democratic transition, Tunisia has proven to be an exception to the rule. In Egypt, despite the resignation of Hosni Mubarak, over time the military was ultimately able to organize a counterrevolution and stifle true democratic change. Absorbing these lessons, the Algerian government has moved swiftly to orchestrate the resignation of Bouteflika and a process for succession in an attempt to deny the protesters a Tunisian outcome.

{mosads}How did we get here? Fifteen years after the end of the civil war in Algeria, the tenuous promises of its social contract are unraveling. The near complete centralization of power within the two ruling parties and security establishment has stifled dialogue and debate. Decision making has remained in the hands of the economic, political, and military elite, known as “le pouvoir,” as well as the “tripartite” comprised of the trade union federation, an entrepreneurial lobby, and the cabinet. The citizenry is frustrated and angry about the deteriorating economy and lack of opportunity, but they have had few outlets through which to express their discontent and secure meaningful action from the government.

Algeria has attempted to manage these internal contradictions through measures designed to appease key constituencies. Since the early 2000s, Algeria has relied on public spending to maintain social stability through cash subsidies, free housing, and other forms of handouts. In 2011 and 2014, the government attempted to spend its way out of crisis without making much needed structural changes to the economy. While effective in the short term, this model of citizen appeasement further entrenched Algerian interests and rigidity, while neglecting to institute the democratic reforms for the government to be truly responsive to citizen needs.

Much of the current unrest in Algeria can be attributed to the direct consequences of the collapse in oil prices and the structural inability and unwillingness of the government provide a palatable response to the challenge. With hydrocarbon revenues, which account for 60 percent of government revenues and 95 percent of export earnings, down by half, the government instituted some punishing austerity measures including a 14 percent spending cut, price increases on subsidized items, and a freeze on public sector hiring. Despite these efforts, the government has drained its coffers and the unemployment rate remains at more than 11 percent, with youth unemployment at around a staggering 29 percent.

Long term stability in Algeria can only be achieved through meaningful structural reforms that close the gap between the citizenry and the government. The resignation of Bouteflika is a positive step, but for real change to take place, the government must address the need for greater transparency and broader inclusiveness. It should begin by engaging the population, and importantly young people, in an effort to renegotiate the social contract. Furthermore, the protestors and political opposition must be allowed to organize and participate in any upcoming elections.

Most critically, economic reforms are necessary to tackle the rentier economy in Algeria, which has left the country vulnerable to fluctuations in commodity prices and has hindered sustainable economic growth. Reducing red tape, improving access to finance, and reducing national dependence on oil and gas by diversifying the economy are crucial to securing accountability from state institutions and private sector actors.

The situation in Algeria remains a test of wills. Can the authorities sustain an approach in which they merely manage popular frustrations in order to protect the status quo, or will the forces of democratic change prevail and deliver a Tunisian outcome? The resignation of Bouteflika, while indeed welcome, is by no means a guarantee that either course will prevail.

Patricia Karam is regional director for the Middle East and North Africa at the International Republican Institute, a democracy development group.