Sheikh Abdallah Djaballah, 54, head of a party called the Front for Justice and Development, said the government had tried to appease anger by handing out cash, but had failed to address a lack of democracy at the root of Algeria's problems.

"The sources of tensions may unify and become a tsunami that will destroy everything," Djaballah told Reuters in an interview.

"The regime wanted to fix the problem financially by saying that the crisis is social and that raising wages will be enough... It is true that the social aspect of the crisis is real, but the key problem remains political."

Algeria, an important gas supplier to Europe and a U.S. ally in its fight against al Qaeda, has been shaken by unrest and strikes since the beginning of this year, with people demanding better pay and lower prices.

The government of President Abdelaziz Bouteflika, 74, feared the strikes and protests could lead to the kind of revolt which toppled long-standing rulers in Egypt and neighbouring Tunisia.

Bouteflika responded by using energy revenues to give hefty pay rises for almost all public employees and to raise subsidies on basic foodstuffs.

To relieve pressure for political change, he also lifted a 19-year-old state of emergency, promised to give the opposition a voice in state media and set up a commission to recommend political reforms.

Since then the number of protests has fallen sharply, but the problems are still there, said Jaballah, who wears a beard, like most Islamists, but also dresses in Western clothes.

"If someone has cancer, you cannot just give them a sedative and this is what the government has been doing so far," he said.

Global Arab Network

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http://www.reuters.com/article/2011/08/18/us-algeria-arabspring-islamist-idUSTRE77H2LE20110818