This study is part of a series ofanalytical works on Algeria prepared by the Bank, with theaim of laying out the framework, and facilitating thedialogue for elaborating the Bank's Country AssistanceStrategy for Algeria. Companion studies include: "APrivate Sector Development Strategy Note: A Diagnostic onForeign Direct Investment in Algeria" (FIAS). Thisreport is divided into three parts. It presents a diagnosticof the slow growth performance, by benchmarkingAlgeria's performance against other comparatorcountries, with the aim of identifying the key bottlenecksto better long-term growth performance in Algeria".Building on this analysis, experience from transitioneconomies, and diagnostics in the companion reports, thesecond part reviews options in structural reforms toencourage the development of the private sector, bystrengthening the investment climate and furtheringAlgeria's transition to the market. the third partexamines options to strengthen the fiscal framework, toinsulate the fiscal stance from volatile hydrocarbon fiscalrevenues and secure fiscal sustainability, so as to achievea sustained acceleration of growth. More technicalbackground material of the analysis is presented in theannexes, in volume two.