1. How is Madagascar working to strengthen macroeconomic stability and build investor confidence?
In today’s global context, macroeconomic stability is crucial. For Madagascar, despite the Covid-19 crisis, frequent climate shocks, and international uncertainties, our macroeconomic fundamentals remain strong. Post-Covid economic growth has averaged 4%, higher than the Sub-Saharan African average, with potential for acceleration. Our Central Bank’s proactive measures have kept inflation under control.
On the public finance side, reforms, particularly in digitalizing public finance functions, have boosted tax revenues. We have also improved the management of public investments to ensure more efficient resource allocation. Despite a current account deficit, our balance of payments remains solid.
Madagascar is currently implementing an IMF-supported program through the Extended Credit Facility and the Resilience and Sustainability Facility. All macroeconomic indicators are reviewed every six months. Recently, the IMF Board validated the second program review and approved an immediate disbursement of about $107 million. This confirms that Madagascar is aligned with reform objectives and has met its quantitative criteria, including growth, tax revenue increases, control of the primary balance, and sound public debt management. Such recognition strengthens investor confidence in our macroeconomic stability. Of course, we remain vigilant and continue to consolidate these gains while advancing reforms.
2. What fiscal reforms and public finance modernization initiatives have been undertaken to support inclusive growth?
Madagascar has launched extensive reforms to improve revenue mobilization and modernize public finance management. In terms of taxation, we have rolled out eComptabilité to digitalize accounting, expanded the e-Hetra online tax declaration and payment system nationwide, and introduced the new Integrated Tax Administration System (SAFI), which allows 24/7 online tax declarations and payments. We also ratified the MAAC Convention on Mutual Administrative Assistance to fight tax fraud and strengthened support for local governments in property tax collection.
On public finance management, we are updating the Organic Law on Public Finance and the Public Procurement Code. We have introduced the Annual Commitment and Authorization Plan to better plan and control public spending, adopted a law requiring mandatory Treasury plans, and created a Budgetary Risk Committee to anticipate fiscal shocks. Treasury operations have been reformed through new units, common cash pooling, and the establishment of a Treasury dedicated to externally financed projects, which became operational in March 2024.
We are also advancing digital payment reforms with the Single Treasury Platform and E-sandrify system, alongside platforms to monitor external financing, non-tax revenues, and off-regulation entities. These reforms will secure revenues, improve expenditure allocation, and strengthen debt management. Ultimately, this provides more fiscal space and greater capacity to finance transformative infrastructure in energy, transport, connectivity, and food security, all contributing to inclusive growth.
3. How is Madagascar promoting a dynamic and diversified economy?
Madagascar is endowed with vast natural capital: arable land, unique biodiversity, significant blue economy potential, and major mineral reserves. These are highly attractive investment opportunities. But our country also offers advantages in telecommunications, digital services, and business process outsourcing. Our geographic position allows us to serve Europe in near real-time and the United States with next-day turnaround.
Madagascar also has the potential to become a regional maritime hub connecting Asia and Africa. The expansion of Toamasina, our main port, is expected to be completed in 2026. In addition, our skilled workforce in IT, artificial intelligence, and light industry enhances our attractiveness. This makes for a diversified and dynamic economy for investors.
4. What role do Public-Private Partnerships (PPPs) play in Madagascar’s development strategy?
In a world where developing countries face growing challenges in access to energy, water, transport, health, education, and infrastructure under tight fiscal constraints, PPPs offer a practical solution to mobilize resources and accelerate major projects.
They combine the regulatory role of the state with private sector expertise, innovation, and financing. For example, under our “Mission 300” Energy Compact with support from the World Bank and African Development Bank, 60% of financing comes from the private sector through PPP schemes. Two major hydropower projects, Sahofika and Volobe, are being developed under PPPs.
Opportunities also exist in transport, connectivity, and special economic zones. To support this, we are modernizing our PPP legal framework, with a new law expected by year-end. These reforms, alongside our new investment code and sector-specific liberalizations such as telecommunications, are improving the business environment and encouraging private investment.
5. What progress has been made on transparency, governance, and digitalization of public finance?
Transparency and fiscal governance are priorities. The Ministry regularly publishes key documents such as the Citizens’ Budget, budget execution reports, and the Mid-Year Review. In 2024, we also released the results of the 2023 Open Budget Survey.
In June, we presented the final report of the procurement system assessment, conducted with the AfDB and World Bank. Madagascar completed this MAPS assessment in less than nine months, compared to the three years typically required elsewhere, earning international recognition.
On digitalization, we launched the Digital Transformation of Public Finance project, which is building a secure digital architecture to modernize processes, improve governance, and increase efficiency. We are also upgrading the Integrated Public Finance Management System, modernizing payroll and pensions through AUGURE and SIGPensions, reforming procurement via e-GP, and digitalizing non-tax revenue management with the SIGRNF system launched in May 2025.
We are also deploying the National Integrated Monitoring and Evaluation System (SNISE) and the Madagascar Economic and Social Portal (PortES), which are key steps in digitalizing public policy monitoring and evaluation.
6. How is Madagascar mobilizing resources for sustainable development?
First, national resources must be prioritized to reduce dependence on external aid. We are working on digitalizing revenue collection, expanding the tax base, rationalizing tax expenditures, and increasing savings mobilization through financial sector development. Under the IMF program, we aim to raise the tax-to-GDP ratio by 2.5 percentage points by 2027, and we already exceeded our 2024 target.
Second, international resource mobilization must be rethought. With global aid declining, competition for concessional financing is growing. To secure funds, we must demonstrate the relevance and impact of our programs. The recent approval of $877.5 million in financing testifies to donor confidence in Madagascar’s strategy and capacity to deliver.
We are also exploring innovative financing such as blended finance, which combines equity investors and guarantee mechanisms. Debt swaps, particularly climate swaps, are on our agenda as well. Madagascar was the first African country to complete a debt-for-nature swap in 1989. Looking forward, we are preparing to issue green, blue, and even “lemur bonds” as part of our green finance strategy.
7. Why is Madagascar ready to welcome a new wave of strategic investments?
Under the leadership of President Andry Rajoelina, Madagascar has implemented structural reforms during the 2019–2023 mandate, including a new Investment Law, a revised Mining Code, a law on cooperatives, and telecommunications liberalization. Economic diplomacy has been strengthened, and the EDBM investment agency has been reinforced to better support investors.
These measures have improved our international positioning and attractiveness, especially in Africa and the Indian Ocean region. Madagascar has already welcomed waves of investors and major projects such as the Volobe hydropower plant and the $700 million Base Toliara mining project, one of the largest U.S. investments in Africa.
We are not only ready to host new strategic investments across multiple sectors, we have already been doing so. Our priority is to keep strengthening the strategic and operational framework for investment, with the active involvement of the public sector, the private sector, and our international partners.
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