Boost for the role of universities in economic development

A new initiative to create synergies between academia and economic sectors has been unveiled to help retain talent and to drive Algeria’s industrial and technological growth.

To implement this new initiative, a framework agreement was signed on 11 March between the ministry of higher education and scientific research and the Algerian Investment Promotion Agency at an event themed, ‘The role of university and research institutions in improving the investment climate in Algeria’, according to the ministry’s Facebook page.

This initiative is part of electoral plans Algerian President Abdelmadjid Tebboune promised to implement. The grand plan, ‘For a Victorious Algeria’, includes higher education priorities such as support for the economic role of universities.

Universities-economic linkages

The initiative focuses on facilitating linkages between universities, higher education institutions and technological and scientific research centres with economic institutions – to strengthen inter-sectoral cooperation for promoting sustainable, innovative economic development and to create a climate conducive to investment.

Under the initiative, researchers and experts at Algerian universities will create incubators for specialised research to share reliable data and analyses on the nature of markets and available opportunities with investors.

Universities and research centres will also provide specialised consultation services that will help to reduce investment risks and contribute to the accurate preparation of economic feasibility studies to limit project failures or changes due to immature investment ideas.

How to create an attractive investment environment

Professor Abdelkader Djeflat, the former dean of the faculty of economics at the University of Oran in Algeria, told University World News the initiative demonstrates Algeria’s commitment to creating a more attractive investment environment by leveraging its educational and research capabilities, that could potentially lead to “increased innovation, productivity and economic growth”.

“The agreement is likely to stimulate research and development in key sectors such as renewable energies, agriculture, information technology and infrastructure. It is likely to promote knowledge transfer and encourage partnerships between universities, research institutions and foreign investors to promote knowledge exchange and technological advancement,” Djeflat added.

Expanding further, Professor Bouraoui Seyfallah from the University of Science and Technology in Houari Boumediene in Algeria, said the initiative will foster a “dynamic university environment” and establish a strong foundation for research and development.

“This, in turn, will drive technological progress, support the growth of innovative companies, create jobs for university graduates and stimulate further industrial expansion, ultimately contributing to a more resilient and sustainable economy,” Seyfallah told University World News.

In 2023, Algeria’s unemployment rate stood at 12.7% overall, with youth unemployment reaching 30.8%, underscoring the urgency of the issue.

He emphasised that the initiative will also encourage collaboration between academic institutions and the private sector in research and development.

“Such partnerships can accelerate the commercialisation of research, leading to the creation of new products and services,” said Seyfallah.

“Additionally, by leveraging local talent from Algerian universities and mitigating the brain drain, the initiative can benefit from the expertise of Algeria’s highly skilled diaspora.

“Many professionals, employed by international companies and higher education institutions worldwide, bring valuable knowledge and experience. Their involvement can play a crucial role in advancing Algeria’s industrial and technological landscape through collaboration and knowledge transfer,” Seyfallah added.

Algeria has lost an estimated US$165 billion due to the brain drain from about 500,000 elite Algerians working outside the country.

How to tackle some challenges

Djeflat, who is also the founding president of the International Network on Science and Technology for Maghreb Development, or Maghtech, said universities faced several challenges as they set out to promote investment in Algeria.

“These challenges include [Algerian universities’] limited access to funding and resources, restricting their capacity to attract investors and foster innovation [as well as] bureaucratic and administrative hurdles delaying the implementation of research projects and commercialisation efforts.

“The mismatch between skills and market needs is making it harder for graduates to integrate into industries that could benefit from university-driven innovation,” he said.

According to Djeflat, the “underdeveloped entrepreneurial ecosystem” limits universities’ ability to promote investment through entrepreneurial ventures, while resistance to change and a limited entrepreneurial culture within universities impedes their ability to act as drivers of economic transformation in addition to the traditional weak collaboration with industry.

Strategies that could address these challenges include an increase in financial support to universities. Public-private partnerships can also supplement funding gaps and by streamlining bureaucratic procedures so that administrative processes can be simplified.

In addition, university education could be aligned with entrepreneurial goals through curriculum design, and more internships could prepare students for sectors in which there is a high demand for skills, he said.

“Aligning university education with market needs through designing curricula and enhancing internships that prepare students for high-demand sectors, strengthens entrepreneurial ecosystems,” said Djeflat.

Innovation ratings

Algeria ranks 115th among the 133 economies featured in the Global Innovation Index (GII 2024), which lists world economies according to their innovation capabilities.

While Algeria’s main innovation strengths are university-industry research and development (R&D) collaboration (47) and human capital and research (76), its main innovation weaknesses are creative outputs (109), public research-industry co-publications (115), creative goods and services (124), knowledge and technology outputs (125) and high-tech exports (131).

Algeria ranks 111th out of 154 countries in the Global Knowledge Index (GKI) 2021, which measures knowledge performance worldwide, using seven main sectoral indices, including higher education alongside research, development and innovation.