By Hamid Ould Ahmed and Lamine Chikhi
ALGIERS (Reuters) - Algeria is hoping that a fair turnout in municipal elections on Thursday will strengthen the credibility of a political system that has survived the Arab Spring without major protests but failed to meet hopes for reform.
The memory of a brutal civil war in the 1990s between Islamists and the state that killed around 200,000 people is a key factor, analysts say, that has held Algerians back from mass protests like those that swept away rulers in neighboring Tunisia and Libya, as well as Egypt and Yemen.
The OPEC member, which supplies about a fifth of Europe's imported gas, and key U.S. ally in the fight against al Qaeda, has also used its energy revenues to lift living standards with increased social spending.
But if apathy wins out in a vote for councils with little power, authorities could find pressure rising to institute real reforms in an ossified post-colonial political system in which army generals remain the real power behind the scenes.
Interior Minister Daho Ould Kablia has said the government wants to equal the 43 percent turnout of five years ago, talking of hopes for 40-45 percent of 20 million eligible voters taking part out of Algeria's 37 million population.
"Let's all participate in local development!" reads one of many election posters that festoon the streets of the North African state's capital.
The North African state saw some rioting last year over high prices, unemployment and a lack of housing units, but President Abdelaziz Bouteflika responded with a pay rise for public sector employees, free loans for young entrepreneurs and continued subsidies on basic foodstuffs.
Algeria has been classified by the International Monetary Fund as the least indebted among the 20 countries in the Middle East and North Africa, with large dollar reserves of $186 billion in the first half of 2012.
But the state, reliant on an energy sector that employs relatively few people, cannot generate enough jobs for a growing population. The private sector is still in its infancy.
"People's livelihoods depend on this local election," said Farouk Ksentini, head of the pro-government Consultative Commission for the Promotion and Protection of Human Rights.
Standing in front of an Algiers bakery, Mohamed Benhakim was not impressed.
Like many Algerians, he believes change will come only through the next presidential vote, due in 2014. Bouteflika, 75, is serving his third five-year term and is not expected to run in the 2014 election.
"I'm expecting nothing from the election," the 30-year-old teacher said.
Real power lies not with mayors heading the elected municipal councils, but with appointed provincial officials, despite government promises to reform the system.
Many potential voters complain that this limits the ability of local bodies to find local solutions to problems of unemployment and housing shortages. "The mayor should have the last say," said Zakia Hachi, a university student.
Voters will choose mayors for the country's 1,541 town assemblies, and around 60 political parties are putting up candidates, yet mayors complain that they have little sway.
"I have no power and no financial resources to create jobs for my people," complained Rabah Zerouali, a mayor in Dellys, a coastal town about 80 km east of Algiers.
Some Algerian commentators are expecting low turnout in Thursday's election, despite the government campaign.
"I'm even capable of calling for a boycott of an election in which I'm a candidate," wrote Maamar Farah, a columnist with independent daily Le Soir d'Algerie.
(Reporting by Hamid Ould Ahmed; Editing by Andrew Hammond)
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