The EU and Algeria: a chance for hope?

The unrest lacked a coherent political message or a unifying opposition, and descended into riots that more resembled London in August 2011 than the revolutions in its neighbourhood.

The Algerian government responded tactically by lifting the 19 year old state of emergency, raising wages in sectors that had gone on strike, and kicking off a process of legislative reform akin to Morocco's constitutional review in the same year.

Our attention has been focussed on why political protest did not take off in Algiers as it has in so many other countries in the region.

This has rightly centred on the trauma of the horrific internal armed conflict in the 1990s engendering a deep preference for stability even at a high cost in terms of personal freedoms, and on the lack of a regime hate figure - the Algerian people acknowledge President Bouteflika's achievements in cementing peace in the country and re-engaging Algeria with the international scene since he came to power in 1999.

Of course no-one can rule out that Algeria still might rise up against its ruling regime.

But as we move into a new year, with a revised European Neighbourhood Policy (ENP) for an utterly changed southern neighbourhood, this is no longer the question Europe should now be asking itself. Rather we should assess how we can improve what has become a dysfunctional relationship between the EU and Algeria to support reform in the longer term.

Algeria has gone through the motions of co-operation with the EU over the past decade without really needing to take its multilateral partner very seriously. As a significant exporter of hydrocarbons to a number of European states such as Spain, Italy, France, and Portugal, it knows that the decisions of importance take place at bilateral level. And as the economic and political crisis in the EU reached a nadir over the weekend, the EU has not really sold itself as an interlocutor of choice.

Nevertheless, there are reasons why Algeria is more open now to a mutually beneficial partnership with Europe now than previously. The regime is aware that it is not immune to Arab uprisings, and that it is not really presenting a domestic alternative. The 2012 elections will offer little real choice, and Bouteflika - the public face of the regime backed by the military, security and business elites - is old, increasingly less visible and has no emerging successor.

The outlook is also uncertain in Algeria's neighbourhood. Bordering Tunisia, Morocco and Libya, Algeria now faces governments dominated by Islamist partiers on all sides. At home it has a hydrocarbon-dependent economy which cannot forever support the current social contract based on state subsidy. Algeria wants foreign investment to diversify its economy, but businesses will not come until the major obstacles of corruption and red tape are tackled.

The time is right for a reset in relations as ECFR's new policy brief argues. The EU can offer support in these areas and turn this into influence. But not if it simply follows the same ineffective rituals, as the EU-Algeria Association Council on 16 December looks set to do. This should be about creating a differentiated partnership in the context of the ENP.

With so much else on its plate at home and abroad, why should the EU bother to reset Algeria relations now? Arguably, Algeria is less repressive than many other pre- and post Arab Spring regimes. It is not Syria, and it is not Yemen.

There are three good reasons.

Firstly because Algeria matters as a regional partner, not only as a hydrocarbon exporter: it is a sizeable economy which could be a significant engine of regional growth with a modernised economy.

Secondly because the status quo is not working - neither Brussels or Algiers gets much out of the relationship and the EU currently has no leverage on political reform in Algiers. A reset could at least give it a voice on the need for economic modernisation, and the spread of rule of law in the business sector which could have a broader impact. Over the longer term this could be turned into influence on more sensitive issues such as lack of genuine pluralism, the need for an independent judiciary and respect for human rights.

Finally, what matters to the average Algerian is not the repression that they suffer relative to those who live in the neighbouring country, but their absolute position.

As an international body that seeks to promote absolute standards this should be the guiding principle for the EU in its relations with the countries of its neighbourhood and beyond. Where we can seek to influence more effectively for political reform, we should.

Susi Dennison is a policy fellow at the European Council on Foreign Relations think-tank