Algiers had recalled the ambassador in response to French President Emmanuel Macron's criticism of the Algerian state. Algeria has experienced other diplomatic clashes in recent months, notably with Morocco. These reflect serious challenges and a growing degree of diplomatic isolation, even though they offer some distraction from domestic political, social and economic challenges.
Social unrest is likely as the 2022 budget transforms welfare distribution, replacing universal food subsidies with means-tested benefits.
The diplomatic rupture and limits on transportation links will make working across Algeria and Morocco more difficult for businesses.
French relations with and perceptions of Algeria will be part of the French presidential campaign.
