While for months officials repeated that the Algeria’s large foreign exchange reserves would shield the country from collapsing oil prices, Algerian prime minister announced that the crisis had reached Algeria’s economy. Algeria must now navigate a precarious balance between curbing high public spending without restricting a generous welfare budget that has helped stave off social unrest. Algeria seeks more foreign investment to help increase energy output—the source of 60 percent of state revenue—which has remained largely stagnant for the last three years.

The Egyptian armed forces have expanded their control over the country’s economy since the 2011 revolution, having won bids for major projects. Economic experts estimate the military’s holdings at anywhere between five and 60 percent of the economy. At least six major infrastructure contracts for roads, bridges, tunnels and apartment blocks—worth more than $1.5 billion—went to the military between September and December 2013. [MEMO, 1/26/2015]

Caught in a struggle between rival governments and threatened by air attacks, oil shippers face higher costs and the possible loss of insurance coverage on Libyan trips. The turmoil is likely to raise insurance costs on shipments or even lead to Libya being excluded from insurance policies. The conflict could also mean contractual disputes may emerge. [Reuters, 1/27/2015]

Tunisia, through its central bank, has opened books on a new ten-year US dollar denominated bond at a yield of 6 percent. The deal is expected to price on Tuesday with Natixis, Citigroup, and JP Morgan as the lead managers of the sale. Tunisia still faces security concerns, potential social discontent with high unemployment, and government debt exceeding 50 percent of gross domestic product, all of which will weigh on credit quality. [Reuters, Bloomberg, 1/26/2015]