The reality of investment in transport infrastructure and its relationship with export promotion in Algeria

Abstract

The transport sector plays a pivotal role in supporting economic growth and sustainable development. This study aims to examine the relationship between investment in transport infrastructure and exports in Algeria during the period from 1991 to 2020. By analyzing various indicators, it becomes evident that the state has shown a strong interest in investing in the transport sector, allocating about 8.15% of total investment resources to it. Consequently, the sector's contribution to the GDP, excluding the hydrocarbon sector, has seen consistent growth. The results of the empirical analysis, based on the ARDL methodology, indicate that there is no long-term equilibrium relationship between investment in the transport sector and exports in Algeria. This can be attributed primarily to the characteristics of the Algerian economy, which suffers from weak production and export capacities among companies, alongside high production costs that diminish the competitiveness of local products in global markets. Additionally, the lack of diversity in exported goods further compounds the issue. These challenges collectively act as obstacles to boosting exports, even in the presence of a modern and efficient transport network..