New Algerian PM forms government

President Bouteflika "was unhappy with Benbitour's pace of reforms"

Algeria's newly appointed Prime Minister Ali Benflis has formed a government, retaining almost all of the ministers who served under his predecessor, Ahmed Benbitour who quit on Saturday.

The new prime minister is one of the closest advisers of President Abdelaziz Bouteflika.

Mr Benbitour had been in office since December 1999, when he formed a government consisting of five political parties.

Benflis: The president's right hand man

A statement issued by Mr Benbitour said he had resigned because of differences with the president, notably over his approach to reviving the economy.

The new premier, who is a lawyer by training, served as justice minister in several Algerian administrations.

Mr Benflis, 56, was appointed to head the presidential office last year after managing Mr Bouteflika's 1999 presidential campaign, Algerian TV said.

In his ministerial line-up, Mr Benflis has appointed the former parliament speaker, Abdelaziz Belkhadem, as foreign minister.

Reformer

According to state television, Mr Belkadem is widely seen as an Islamic conservative opposed to any normalisation of ties with Israel.

On the other hand, Mr Benflis is considered a reformer. A western diplomat quoted by Reuters news agency said the appointment was aimed at securing President Bouteflika's "power over the bureaucracy after failing to insert his own men into the military establishment."

Benbitour: Resigned on Saturday

"Bouteflika trusts Benflis deeply...and by putting him at the top of the government hierachy the president is expected to prepare for other changes, including a referendum to extend the presidential term to seven years from the current five-year term", the diplomat said.

In August, President Bouteflika fired a number of local officials as part of a larger shake-up of the Algerian administration.

Most of those fired have faced harsh criticism in the media during the past few weeks for poor management of land and housing, correspondents said.

Reports indicate that Algeria is saddled with more than $31b in foreign debt and unemployment is running at 30% especially among youths who form majority of the country's population of 30m.