Algerian president fires central bank governor following oil price drop

Governor of the Bank of Algeria Mohammed Laksaci listens to International Monetary Fund (IMF) Managing Director Dominique Strauss-Kahn (not pictured) during a news conference in Algiers November 3, 2010. REUTERS/Zohra Bensemra

ALGIERS (Reuters) - President Abdelaziz Bouteflika on Tuesday fired Algeria’s central bank chief, who had been under pressure from ruling party critics over his management of fall-out from the 2014-2015 global oil price drop, two government sources said.

Mohammed Laksaci had been the central bank governor for more than a decade. Bouteflika held a cabinet meeting early on Tuesday, according to state news media.

The central bank chief would be replaced by Mohamed Loukal, chairman of state-run Banque Exterieure d’Algerie, one of the country’s largest government controlled banks.

The dismissal of the central bank chief came as Algeria looks to confront the fall in global crude prices that has cut its energy revenues, devalued the dinar to record lows and turned a trade surplus into a deficit.

The North African OPEC state has started to take measures to counter the fall in oil prices, including raising subsidized fuel and electricity prices, cutting back on infrastructure projects and trimming budget spending.

Algeria, a major gas supplier to Europe, still has around $140 billion in foreign reserves that officials say will cushion it from the oil price drop. But its energy earnings fell by nearly 50 percent in 2015.

That prompted debate over how to manage the oil price fall, between reformers who see a chance to open up an economy still reliant on oil and gas, and, analysts say, an older guard cautious on liberalizing a mostly state-controlled system.

Reporting by Lamine Chikhi; Writing by Patrick Markey; Editing by Mark Heinrich