Tins of baby food, stereo equipment and felt-tip pens were to be used in an attempt to smuggle chemicals "which could be used for both the making of explosives and for use in poisons to kill people," said Nigel Sweeney, for the prosecution.
He alleged that seven consignments - including chemicals and other items - were sent from Britain to Algeria between 1992 and 1997.
Armed police swooped on addresses in south London on 22 May last year and two Algerians were arrested. A third was arrested in Bristol two months later. "They were all in this country illegally and in possession of false identity documents. They were either members or supporters of a group called the Groupement Islamique Arme," said Mr Sweeney.
Their objective was to obtain materials, including chemicals and manuals on explosives, weaponry and radio equipment, "for the purpose of smuggling them from this country to Algeria for use by the GIA in ... acts of terrorism", the court was told.
The three - Sofiane Kebilene and Farid Boukemiche, both from Peckham, and Sofiane Souidi, from Bermondsey, all in south London - have denied possession of articles for suspected terrorist purposes on 22 May last year. Kebilene and Souidi are in their early thirties and Boukemiche is in his late twenties.
Mr Sweeney alleged that the three's activities were financed by obtaining banking facilities, credit and store cards fraudulently. Kebilene had at least 17 different bank accounts, both in his own name and in a false name, together with 22 credit or store cards and a bank loan for more than pounds 18,000. By the time of their arrest, cards and loans had been used to obtain goods and services to the value of pounds 100,000.
The security service operation included a 66-day video and mobile surveillance, and the interception of a second purchase of chemicals in March last year. These chemicals were substituted with a harmless substance before being delivered to the defendants, Mr Sweeney told the jury.
Part of the switched delivery was found at the Bermondsey address where Souidi was living. Baby powder containers and felt-tip pens were also found there. Their original contents had been replaced with part of what was believed to be chemicals "so they could be smuggled to Algeria", said Mr Sweeney.
Books on guerrilla warfare, bombs and chemicals, and materials about the GIA, were also allegedly discovered, along with pounds 20,000 in cash, FFr13,000, and a small amount in dollars and German marks.
Mr Sweeney said that fingerprints of all three defendants were found on various items.
The trial continues.