An action plan by the government of Algeria, which will be debated in Parliament next Monday, aims to promote the knowledge economy, research and development (R&D), and innovation while also speeding up the digital transformation and startup development.
“The government is committed to developing a knowledge economy framework law, establishing a national technology transfer plan, and establishing mechanisms for funding prototyping and research and development for the benefit of startups,” a statement from the Algerian government reads.
Tax Incentives For Innovative Projects
- The plan calls for the creation of tax incentives to encourage companies to invest in research and development, as well as the creation of a regulatory framework governing expenditure that can be classified as R&D expenditure in a company and incentives to encourage companies to conduct research theses.
- In addition, the plan calls for the creation of a mechanism to support international patent filing, the encouragement of highly qualified labor recruitment in companies, the creation of the status of researcher in a startup company, and the digitization of patent filing procedures to strengthen the knowledge-based economy.
Free Zones For Startups
- The plans also entails the establishment of technological free zones and prototype workshops (makerspaces) for the benefit of innovative project leaders, as well as the utilization of national service providers in the digital and new technology sectors.
- In addition, the government intends to promote the startup ecosystem and the digital economy through its action plan by establishing a regulatory framework for open innovation and electronic payment intermediaries as well as the deployment of Crowdfunding application texts (crowdfunding).
- It also calls for a revision of the e-commerce legislative framework to make it more flexible for startups, as well as the simplification of business formation procedures for startups and other first-time investors, the creation of statutes for freelancers and self-entrepreneurs, and a stronger role for startups as a vector of financial inclusion through e-payments.
A National Network Of ‘Business Angels’
- In addition, the action plan calls for the establishment of a national network of “Business Angels,” regional representations of the “Algerian Startup Fund,” the launch of a startup acceleration program through the public accelerator “Algeria Venture,” the establishment of incubators and accelerators in all of the country’s wilayas (provinces), and the establishment of a system of evaluation and monitoring.
- The plan also involves the establishment of a Finlab for the benefit of startups active in the financial technologies sector (fintechs), the promotion of venture capital, which plays an important role in the financing of innovation, and the simplification of administrative procedures for the establishment of investment funds and mutual funds in the innovation sector.
- In addition, the action plan calls for the implementation of “Business Angel” incentive programs and tax exemptions for amounts invested in startups, as well as the facilitation of access to e-payment for the benefit of startups, the use of Wilaya investment funds for start-up financing, and the strengthening of collaboration with investment funds likely to invest in startups in Algeria as well as the encouragement of foreign startups to integrate into the Algerian ecosystem.
A Youthful Minister Of Startups Has Been Instrumental In Influencing Policies Affecting Startups In Algeria
Algeria understands that the country’s startup ecosystem is largely driven by young people and has responded to this trend by appointing a youthful minister in charge of startups.
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Aged only 27, Yacine Oualid became Algeria’s new Minister of Startups — a newly created ministry under the newly elected President Abdelmadjid Tebboune’s administration — on January 02, 2020.
He studied at the Faculty of Medicine of the University of Sidi Bel Abbès.
Prior to becoming Algeria’s Minister of Startups, in June 2016 Yacine Oualid created SSH, a company specializing in cloud solutions for businesses, which would later become the first private web host in Algeria. In September 2019, he and his partner founded Smart Ways3, a startup in the field of logistics and geolocation. In December of the same year, he founded Bright Solutions, a leading IT company providing IT solutions and services, headquartered in England.
“If I have to sum it up, I would say that the New World Economy is taking shape, and that Algeria wishes, and will, become a major player. My goal, with all the players in the sector, is to participate in this transformation of the largest country in Africa,” Yacine said upon assumption of office.
“In a more practical way, my role is first of all to set up a legal framework which is favorable to startups. Once set up, this legal framework will facilitate the creation of startups and their financing. The goal is to see materialise in a few months’ time, Algerian champions, who will be able to offer their services all over the world. Algeria is determined to become an African pillar of innovation and we want to offer our entrepreneurs the best framework for entrepreneurship and innovation,” he added.
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Apart from influencing the enactment of startup-friendly policies, Oualid has been instrumental in activism against ‘bad regulations’ against startups in the North African country. For instance, his intervention ensured that Algeria’s first taxi service solely for women, Moov Services, re-launched its operations just three months after its activities were banned in Blida, Algeria’s northwestern province.
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Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer