Sonatrach attempts reform in face of political and cultural headwinds

The appointment of a new cadre of senior executives and the streamlining of Sonatrach’s top-level management structure is intended to focus the organisation on its core upstream and downstream activities, and in particular to reverse the declines in production of recent years. The government is also planning broader reforms of business conditions, potentially relaxing financial restrictions that are unpopular with foreign investors. Supporters of these efforts argue that there is no alternative as the budget and current account deficits are unsustainable. But meaningful reform will require both a change of culture within Sonatrach and other institutions, and strong leadership.