Over the past few years (2000-2004), North African economies have been influenced by two factors: the price of oil and the legacy of economic policies and structures that have emphasized a leading role for the State. Indeed oil (and increasingly natural gas) is both the greatest strength and the biggest weakness of the North African subregion. As has been the case for decades, revenues generated by these two hydrocarbon-based resources still account for the bulk of economic activity and export revenue, particularly in Algeria and Libya. Even modest producers such as Egypt rely on oil output to generate export revenues, while Tunisia’s limited oil production merely allows the country to avoid a heavy oil import bill. Recent oil reserves discovery in Sudan and Mauritania might also lead to dependence on oil revenues, if income sources are not diversified.