The State, in particular, has not reduced staff numbers in proportion to the posts transferred to decentralised authorities, whereas the latter have recruited on a large scale to fill these positions. Demographic developments provide an opportunity to turn this trend around and create more flexibility. Recent announcements stating that half the posts left vacant following retirements are not to be filled show that this opportunity will be seized. •  Lastly, maintain cyclical flexibility. France, as we mentioned, is currently at a favourable point of the business cycle that automatically increases government revenue and, all other things being equal, reduces the deficit. This gives an impression of affluence that may be misleading and dangerous. What counts here is the general government structural balance. In our country, it is high (above 2% of GDP), which means that our public finances are particularly vulnerable to an economic slowdown or a turnaround in the business cycle. In such a case – unless we are prepared to enter an endless downward spiral – even the forward-looking spending would have to be sacrificed. One imperative must ultimately dominate the management of public finances: the well-being of future generations. It is they who will have to sustain, service and finance the public debt that is building up today. It may be understandable and justifiable if this debt were used to establish an economic capital that would benefit these generations. But this debt would be economically inefficient and morally unjust if future generations had to finance current generations’ welfare spending.

Investment of the remaining sectors of the economy represented 31% of total investment over the period 2004–08. In 2008, this ratio was 26.4%, although investment in these sectors increased sharply during this year (+37.4%). In the context of structural excess savings over investments, the structure of investment financing in Algeria over the past 5 years reflects the predominance of self-financing (82.5%) on account of the budgetary financing of the public investment programs. Indeed, with significantly increased financing capacity, domestic financing has been the sole source of public investments financing, at a time where external debt was significantly reduced, notably through advanced repayments of nearly all public external debt (which amounted to $ billion 13.9 by end 2003). Domestic public debt has also been significantly reduced to a level representing 6.6% of GDP in 2008, down from 18.7% of GDP in 2003. In addition, available resources in the stabilization fund amounted to $ billion 59 by end 2008, representing a sizeable self-financing capacity which allows continued implementation of the investment program (2009–10) in the context of external shocks. While Sonatrach’s investments were partly – although to a large extent – financed on the company’s own resources over the period 2001–04, accumulated savings (reaching $ billion 18 by end 2008) have since allowed for total self-financing of the oil company’s investments, with investments in 2009 upstream and downstream significantly increasing, in view of the important opportunities in the sector and in line with the objective of achieving potential capacity.