, at a time where external debt was significantly reduced, notably through advanced repayments of nearly all public external debt ( which amounted to us $ 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 us $ 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 us $ 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. investment in the remaining sectors of the economy have also been, to a large extent, selffinanced ( 44. 2 % during the period 2004 – 08 ) while financial savings of private enterprises and households increased. the share of bank financing, mainly domestic, represented 50. 5 % while bond issuance covered 5. 3 % of financing needs. domestic medium and long term bank loans, which have been substantially increasing over the past 5 years, have been oriented to investments in productive non - oil sectors, notably energy and water sectors where investments have significantly increased. anchored to relatively stable and sustainable resources, the development of credit allocation has been notable, with credit to the economy increasing by 15. 7 % in 2007 and 18. 6 % in 2008. growth in the credit to the economy in 2009 remained strong ( 19. 4 %, twelve months increase by june 2009 ) at a time where many emerging economies faced bank credit contractions. credit to private enterprises and households represents a large share of total allocated credit ( 54 to 55 % over the past 3 years ). medium and long term ( investment ) credit increased by 20. 9 % in 2008 and 12. 9 % in the first half of 2009, reflecting favorable domestic bank financing conditions. in this favorable financing context, additional measures have been introduced in the supplementary budget law of july 2009, aimed at further promoting credit to small and medium size enterprises ( smes ), including increasing the maximum government guaranteed credit amount. in

. 2. savings and investment financing structure following a period of external financial imbalances and related adjustment programs during the nineties, algeria has entered, since 2000, a period of sustained increase in savings, leading to a situation of excess savings over investment. despite a situation of increasing investment rates, the ratio of total savings to gdp reached 57 % in 2008 against 48 % in 2004, leading to a context of excess saving rates of 13 % to 24, 7 % over the period. these developments have allowed sizeable reserve accumulation, particularly from 2004 ( us $ billion 43 ) to 2008 ( us $ billion 143 ) as a cushion against possible external shocks, including shocks of a “ sudden stop ” nature. anchored to regained macroeconomic stability, a large public investment program was launched in 2001 ( 2001 – 04 ) followed by a larger one in 2005 ( 2005 – 09 ). implementation of the two public investment programs significantly stimulated gross fixed capital formation, with public investments representing 56. 5 % of total investment in 2008 up from 40. 8 % in 2004. over the past five years, public investments ( economic and social infrastructure, housing, agriculture and water, others ) amounted to us $ billion 80 ( representing 51 % of a total of us $ billion 156 ). it should be noted that foreign companies, particularly from asia, hold a significant position in terms of implementation of the public investment programs. in parallel, the national oil company ( sonatrach ) implemented ambitious annual investment plans over the past 3 years, increasing the annual investment envelope from us $ billion 4. 8 in 2006 to us $ billion 8. 5 in 2008. for the past 5 years, the ratio of sonatrach ’ s investment to total investment reached 17. 6 % ( 17. 1 % in 2008 ). for 2009, sonatrach ’ s investment program amounts to us $ billion 16. 5. 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