Republic of Madagascar
Poverty Reduction Strategy Paper: Annual Progress Report for 2007 and First Semester of 2008

The report examines the annual report of Madagascar’s Poverty Reduction Strategy Paper. Madagascar’s economic situation has been characterized by steady growth estimated at 5.0 percent on average against an average annual demographic growth rate of 2.8 percent. However, the living standard of the population as captured by the indicators related to the big objectives of the Madagascar Action Plan has not kept up with this pace. The organic law on public finances and the new code of public procurements have become more effective.


The report examines the annual report of Madagascar’s Poverty Reduction Strategy Paper. Madagascar’s economic situation has been characterized by steady growth estimated at 5.0 percent on average against an average annual demographic growth rate of 2.8 percent. However, the living standard of the population as captured by the indicators related to the big objectives of the Madagascar Action Plan has not kept up with this pace. The organic law on public finances and the new code of public procurements have become more effective.


Situation of the indicators related to the Big Objectives

Steady positive growth but slow fall of poverty and progress achieved in terms of human development

Growth and poverty

Over the last years, the country has launched specific programs in various areas and has committed additional resources obtained from the debt service relief to essential social sectors (health, education, justice, population and social protection).

The situation over the last three years has been characterized by the followings:

  • An improved overall performance with a steady growth estimated at 5.0% on average, increasing from 4.6% in 2005 to 6.2% in 2007;

  • An increase in private investments estimated at 12.3% of the GDP in 2005 and at 28.3% in 2007, which fostered an increase of the real GDP per capita;

  • A significant drop in the inflation rate, from11.5% in 2005 to 10.8% in 2006 and 8.2% in 2007 (end of period);

  • An improved overall economic environment as reflected in the trends in the corruption perception index which improved from 1.7 in 2002 to 2.8 in 2005 and to 3.2 in 2007 (Transparency International);

  • An increase in significant flows of foreign direct investments observed in 2006 and 2006, amounting respectively 150.5 million SDR and 652.1 million SDR despite the many constraints that are perceived by some sectors.

Graph 1:
Graph 1:

Economic growth rate, inflation rate, and gross investment rate

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001


From 2001 to 2006, according to the MDGs Follow Up Report in 2007, poverty has dropped by 2.1 points of percentage, decreasing from 69.6% to 67.5%. The downward trend has been maintained in 2007, and the poverty rate should drop to 66.3% according to the forecasts of the National Institute of Statistics (INSTAT).

Graph 2:
Graph 2:

Poverty Ration, GDP/Capita


Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: INSTAT, Household (1993 1997 1999 2001 2002)

However, significant regional disparities are noted in the current situation:

  • Only eight regions have a poverty rate below the national average in 2005,

  • Three fourths (¾) of the poor are found in rural areas where 80% of the population lives.

The disparities are due to:

  • The low productivity of the economic sectors;

  • Acute unemployment and underemployment;

  • The poor state of infrastructures;

  • The effects of climate change.

In addition, urban poverty has increased by 8.1 points from 2001 to 2006 while rural poverty dropped by 3.7 points over the same period.

Unfortunately, the inequalities in resources distribution have become even more marked with the 20% of the poorest consuming 7.3% of the total consumption mass in 2005 against 6,7% in 2006.

As regards food security, the malnutrition rate as assessed through the proportion of children under five suffering from low weight seen in community sites and BHCs has tangibly decreased. However, land security, as an indirect factor, remains a big challenge in the rural world and calls for a quantum leap as only 10.4% of rural holders had a land title in 2007 while the objective by 2012 is 75%. Given the trends in growth and income per capita, the annual decrease of poverty has been only of 1.2 points on average over the last three years. Thus, poverty is decreasing slowly. If such a pace is maintained over the coming years, the objectives of cutting the proportion of the population living under the poverty line down to 50% by 2012 and down to 35% by 2015 will not be achieved.

Human Development: HDI, SHDI1

Graph 3:
Graph 3:

Developments of HDI and SHDI

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: INSTAT

With an national average of 0.527, Madagascar has become a country with medium human development (0.5≤HDI<0.8) since 2003 according the MDG Follow Up Report in 2007 and the National Report on Human Development in 2006. This results from the efforts made to improve the educational system and the population’s health status (enrollment rate, literacy rate, and life expectancy at birth).

Graph 4:
Graph 4:

Life expectancy at birth

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: INSTAT

However, disparities remain and indicate that women are victims of discriminations in the economic and social processes, the SHDI being 0.524 and the HDI 0.527.

Graph 5:
Graph 5:

HDI-SHDI per province in 2005

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: INSTAT
Graph 6:
Graph 6:

Estimated ratio of income Men/Women

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: INSTAT

The country is still building on the achievements made in social progress and has been sustaining and improving its performance over the last three years (2005 to 2007). The impacts of the efforts have become tangible and are reflected by the followings:

  • The completion rates at the primary level, lower secondary, and higher secondary per gender as regards the educational sector;

  • The improvement of the enrollment rate with the net rate becoming stable at 97% in the primary level;

  • The increase of the GDP which result in a real GDP per capita of USD295 in 2005, USD288 in 2006, and USD375 in 2007.

Graph 7:
Graph 7:

Literacy and Enrollment Rates

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: INSTAT
Graph 8:
Graph 8:

Literacy Rates by Gender

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: INSTAT
  • Reducing the poverty rate to 50% by 2012 and to 35% by 2015 means that the efforts and actions must be reinforced in order to triple the pace at which poverty is currently decreasing.

  • Maintaining macroeconomic stability through a high growth rate sustained by a high investment rate especially private investment, a decrease of the inflation rate, and an increase of internal resources, namely tax revenues;

  • Implementing sectoral programs, especially in high potentiality sectors in order to reinforce the economic sectors’ productivity and competitiveness so as to induce higher growth based on diverse job-generating economic activities;

  • Keeping on improving the investment climate as well as the business environment.


In order to support the recent performances of the Malagasy economy and to improve the living conditions of the population, the following recommendations are made:

  • Reinforce institutional reforms in process to improve the economic environment through efficient governance, motivation of public servants, facilitation of access to basic infrastructures and resources (energy, telecommunication, land property, industrial zone), and expanding access to public procurements to SMEs;

  • Increase rural productivity in order to ensure food security through technical support to producers, improving rural productive infrastructures and use of modern farming techniques, improved land security, and access to funding;

  • Privilege the “employment” approach in major works to redistribute income and promote entrepreneurship;

  • Reinforce support for micro and small enterprises by setting up and making operational support and promotion centers at the regional level and by facilitating access to funding and partnership;

  • Make operational the National Strategy for Social Protection, targeting more specifically the vulnerable groups;

  • Ensure optimal allocation of resources to the social sectors, in order to ensure redistribution of resources towards the vulnerable groups.

The country will be faced with the major challenge of implementing the National Integrated Monitoring and Evaluation System (NIMES) at the national and regional levels in 2008. The success of the system relies on making operational organizational and institutional frameworks, specifically the information systems, as its main pillars. The INSTAT will proved special support to improve the information system at the national and regional levels, namely to fine tune indicators, consolidate administrative data, and producing statistical information.

In addition, special efforts will be made to improve the availability, the quality, and the reliability of administrative statistics.

Commitment 1: Responsible Governance

We will have a government that every citizen and the international community can trust and have confidence in. This government and the civil service will demonstrate integrity, be efficient, and act professional in all pursuits, activities, and the provision of services. Such are the objectives under this Commitment.

Analysis of the Quantum Leap

According to the Afrobarometer survey in 2005, almost 90% of the Malagasies believe that poor governance is the reason of poverty in the country. Therefore, it is urgent to find a solution to poor governance in order to lift the country out of the difficulties it is currently faced with.

Significant progresses were made in 2007 in the following areas:

  • The crime rate was reduced to 1.8 per 1,000 in 2007;

  • The corruption perception index has been tangibly improving;

  • The public finances management is more efficient;

  • Laws and regulations on decentralization have been promulgated; the laws on the functioning of the Decentralized Collectivities have been developed and should be submitted to the Parliament at its next session.

Analysis of priority indicators

Crime rate reduced at 1.8 per 1,000 inhabitants and 12 hot spots cleaned up
  • Significant results were achieved in the area of people and property’s security though there remain uncontrolled pockets of insecurity due to the lack of resources. In 2007, while the objective was 4 per 1,000, the crime rate was reduced at 1.8 per 1,000, i.e. about 2 offences per 1,000 inhabitants. However, it should be noted that crime has become increasingly violent with the actions of armed gangs;

  • Twelve districts against an objective of ten were cleaned up. One hundred and seventy nine (179) Autonomous Security Detachments have been standardized, the rural security operations and the general police patrols have been reinforced and the system of proximity police has been revitalized. It is more and more demonstrated that the actions of the fokonolona, the administration, and the police force complement each other and such complementarity is improving.

The reported cases of cattle thefts decreased by 38%, mainly due to the recommended actions of repression and intensive checking of marketing documents.

Improved Coverage of the Exclusive Economic Zone

Covering the Exclusive Economic Zone means ensuring the surveillance of the marine zone where the country draws marine and oil resources.

The collaboration between the Civil Protection Body from the Ministry of National Defense and the National Office for Risk and Disaster Management (BNGRC) allowed for strengthening and improving the coverage of the EEZ compared to what was done in 2006. Indeed, the teams performed 133 days of outings on the sea, 626 hours and 25 minutes of flying over the Malagasy aerial space, and 120 hours of outing on fast boasts on the sea against objectives of 136 hours of outings on the sea, 300 hours of flying over, and 100 hours of outings on fast boats.

In the same way, the land surveillance actions carried out by the State Secretariat of Public Security have increased by 47.4% from 2006 to 2007.

Slow decrease of the average time for trials and processing of pending cases

A big delay was noted in the actions aimed at building the capacities of 11% of the jurisdictions in the area of standards of service in 2007. The average time for trials has not improved: the average time for simple criminal cases has remained at 120 days against an objective of 90 days, and the average time for complex criminal cases at 450 days against an objective of 365 days.

In the same way, the actions to improve the processing of pending cases were not significant enough:

  • At the Supreme Court level:

    • - in criminal matters, 79% of the pending cases processed for judgments delivered and 65% for judgments under appeal.

    • - In civil matters, 63% of the pending cases processed for judgments delivered and 73% for judgments under appeal.

  • At the Courts of Appeal: 94M of the pending cases for judgment delivered, 56% for the judgments under appeal, and 48% for case papers.

Actions were also carried out to improve the respect of human rights in prisons, namely an increase to MGA341 in the daily expenditures per prisoner against an objective of MGA120.

Improved corruption perception index

Appreciable progresses were made in the anti-corruption efforts. The actions to reinforce laws and regulations and the setting up of the Higher Council of Integrity and the Independent Anti-Corruption Office (BIANCO) have been yielding early results:

  • The corruption perception index of Transparency International has improved from 1.7 (base 10) in 2002 to 3.2 in 2007. Keeping with such a pace, the objective of 5.0 by 2012 should be achieved.

  • 86% of the cases processed by BIANCO have been transferred to the court and 95% of the investigated cases have been processed. However, the private sector is not fully involved in the implementation of the anti-corruption actions and the proximity actions are not yet effective due to delays in setting up branches throughout the country.

The sustainability of the overall anti-corruption system is dependent on how well the efforts are disseminated into all sectors and all segments of the society as well as the ownership of the fight against this plague by the population.

Reform of public finances management

Madagascar has conducted big efforts to improve its public finances management over the last period:

  • Budgetary procedures clearly improved;

  • High-performance organization of financial forth accounts;

  • Consolidated expenditure chain: better transmission of information, end of the abusive application of emergency procedures;

  • Coordinated efforts on the preparation of the laws relating to payments;

  • Budget implementation reports produced within the year by the Ministries;

  • Improved management of Treasury

However, the operational implementation of the reforms is still faced with some inadequacies that affect the effectiveness and the reliability of the overall mechanism. The budget nomenclature is still somehow complex, which results into difficulties in developing and implementing the budget.

Improved fiscal pressure

Coordinated efforts were carried out to establish an improved method for tax collection. This involved operational and organizational reforms in the customs and tax services, including:

  • Extending the use of Sydonia ++ to the customs offices of Mahajanga, and making operational the automated management of DTI payments at the Toamasina Port’s offices;

  • Developing partnership to expand the setting up of Approved Management Centers (AMC) to the regional level.

  • The tax revenues have increased by 24.7% compared to 2006. The fiscal pressure rate increased by 0.7 point compared to the rate of 10.7% in 2006. The budget deficit, cash base, has clearly improved from - 4.3% of the GDP in 2005 to -2.8 in 2007. Year 2006 was an exceptional year with a budget surplus of 37.4% which was due to debt relief.

All the Ministries are connected to the Integrated Public Finances Management System (IPFMS)

The IPFMS is effectively operational in all the central Ministries, the Treasuries, and the Control of Expenditure Commitments. However, the network is not yet operational at intra-city and intercity level. To make up for this, six regional IT centers have been made operational for the entering budget implementation data.

Budget preparation and implementation procedures improved

The macroeconomic framing of the 2007 budget took the MAP’s priorities into account. The budget was ready for implementation in early January 2007, but the late appointment of the Secondary Authorizing Officer and Activity Managers delayed its actual implementation. Nevertheless, some actions were carried out, including building the capacities of the managers at the Ministries on the procedures, streamlining the nomenclature, instituting a quarterly regulation of expenditure commitment, applied all year long. However, mastering the linkage between public expenditures and results to achieve remains a problem, i.e. the concept of result-oriented management of the budget-program.

Budgetary control reform continued

The control and verification actions were continued through strengthening the operations of the structures in charge of procurement (Procurement Officers and Procurement Management Units) in the ministries. As regards the control of expenditure commitments, a counting of authorizations per category of observation and per authorizing officer is being carried out and the related statistics should be available by late 2007.

Contracts awarded through competitive processes

The compliance of expenditure implementation to good governance principles was ensured through the actual enforcement of the new Code of Public Procurements and the functioning of the Authority in charge of Regulating Public Procurements (ARMP).

Despite weaknesses in planning and regulation of credit, the percentage of contracts awarded through a competitive process reached 87.3% of the objectives set (67.6% against an objective of 77.5%).

Procurement procedures compliant with the new legal and regulatory framework

The proportion of procurement procedures assessed as compliant with the new regulatory framework in a sample of public institutions deemed to be representative (Health, Education, Transport, Agriculture, and Public Works) was 93.8% of the objectives set. The Procurement Officers were appointed in the Ministries and received training on typical bidding documents, public procurement techniques, and rules provided by the Code of Public Procurements. However, some of the trainees do not yet master their work.

Administrative procedures streamlined in public services

In order to reinforce the effectiveness of public service provision, the setting up of a one-stop shop at the Ministry of Civil Service has allowed for regularizing the career files of Government employees. As a result, 893 decrees of admission to retirement, 791 decrees and decision of promotion, and 697 cases of integration were processed. Thanks to the Rapid Result Initiative (RRI), the average time for processing a file decreased from 120 to 75 days.

Users benefit form high-quality public service provision with the promotion of e-governance, made concrete through the rolling out of the Government’s Intranet in all Ministries.

Local tax collection rate

The organizational and information systems at the Ministry in charge of Decentralization and Land Development at the Presidency do not yet allow for having real time data on the local tax collection at the decentralized collectivities’ level. Through the data are available, the sampling made among some administrative accounts are not yet reliable enough.

However, with the available information, it is possible to identify positive developments in the collection of taxes at the commune level with an increase from MGA26,245 billion in 2005 to MGA41,376 billion in 2007, i.e. an increase of 57.7%.

Actions have been carried out to improve local tax collection methods:

  • Introduction to the software “HETRA” for 260 communes: census procedures, collection of land taxes, determination and possible expansion of tax base as well as of the amounts to be collected each year;

  • Setting up of Commune Support Centers (CAC), with 300 communes covered to date;

  • Publication of the law setting up the Local Development Fund whose main role is to build the communes’ capacities and to fund their activities and investments.

A small share of the budget allocated to the Communes
Table 1:

Share of the budget allocated to the Communes

article image
Source: MPRDAT

The proportion of the budget allocated to the communes remains low at only 1.52% of the total budget. Given that the executive officers of the communes are at the end of their terms, and given the budget framing constraints, the Central Government acted in a prudent way in allowing funds to meet the needs of the communes because of the poor financial and administrative management capacity of mayors. Therefore, the share of the budget going to the communes was low. However, the Central Government’s will to grant more autonomy is clearly seen in the promising increases in the transfers made over the previous years.

Contributions of Programs and Projects

  • The Program of Reforms for the Efficiency of Administration (PREA) groups the Project of Governance and Institutional Development/IDA (PGDI), the Administrative Reform Support Project (ARA)/UNDP, the Project of Institutional Reinforcement for Governance (PRIBG)/ADB. PREA’s intervention focus on promoting and enhancing the government’s efficiency as part of promoting governance: presidential leadership, development of convergence and harmonization among actions supported by financial partners, a result-oriented spirit, modernization of and capacity building for the public administration, improvement of traceability of financial transactions and steering of proximity services reforms.

  • The reinforcement of integrity and the reform of the business law benefited from the contributions of the Priority Solidarity Fund “Support to Consolidating the Rule of Law”. On the other hand, the “Community Support for the Rule of Law” with the European Union contributes to improving human rights in the prison setting.

  • The Program ACORDS/EU focuses on funding communes.

  • As part of local governance and support to decentralized collectivities and services, the Integrated Growth Poles Project (IG2P) contributed to building the capacities of municipalities as well as increasing their tax revenues.

Completion status of the major committments taken during the presidential dialogue

Immediate Actions
  • Increase by 44.2% of the operations carried out by the different bodies of the police force to establish security, including 15 fokontany supervised, which allowed for arresting 22 bandits;

  • Increase by 27.3% of intelligence information obtained before, during, and after municipal elections;

  • Increase by 35.5% of flash operations during the end-of-year holidays;

  • Bill on establishing the Higher Court of Justice submitted to the Government;

  • Partnership between the BIANCO and the Justice: agreement pending at the Ministry of Justice on regular communication of the results of cases referred to the courts;

  • Production and wide dissemination of a 2008 calendar for all the communes of Madagascar, stressing the responsibilities of and what is expected from elected officials and administrative authorities as well as the institutional aspect of decentralization;

  • Dissemination and distribution of the software “HETRA” for direct and rapid application: the data of 260 communes were entered and the actions will be continued in order to cover all the communes of Madagascar;

  • Setting up of CACs in 300 communes in order to provide technical support.

Actions in 3 months
  • Setting up an information and data processing system that is up-to-date, modern, and standardized: installation of two HF posts in Betafo and Mahanoro, 10 central directorates, and 7 central services connected to the Government’s intranet.

  • Anti-corruption penal chain installed in 3 provincial capitals: Court of First Instance of Mahajanga, Fianarantsoa, Toamasina; actors sensitized;

  • Reinforcing mobilization of civil society organizations as a relay for public information and education;

  • Transfer of competency and power to decentralized collectivities: development of a report going towards a set of bills on decentralized collectivities that will be presented to the first session of the Parliament in May 2008;

  • Making operational the Local Development Fund (LDF): recruiting the first staff. This had to wait for the two chambers of the Parliament to vote the regulations on the organization and the functioning of the LDF

Ongoing actions
  • Gradual application of the computerized management of weapons and ammunition through the entering of data at the service in charge of controlling weapons at the National Police (central and inter-regional levels);

  • Multiplying preventive measures in urban setting: increase by 98.9% in terms of intelligence information; 98.9% for patrols, and 8.1% for TPG;

  • Fight against corruption: training of 46 investigators as peer educators, i.e. an increase in number of 58.6%;

  • Seventy-five (75) police cordons on roads with a decrease by 44.6 of traffic accidents;

  • Increase by 62.1% of the permanent guardians for the protection institutions;

  • Asset declaration form distributed to all magistrates;

  • Bill on the Higher Council of Magistrates adopted by the Parliament;

  • Information shops operational in 15 magistrates’ courts and 4 courts of appeal;

  • Twenty-two (22) checks on compliance with the rules of ethics and deontology conducted by the magistrates and the jurisdictions’ staff;

  • Implementation of the process to establish the standard of minimum service;

  • Awareness raising and developing the sense of responsibility among administrative authorities;

  • Involving decentralized collectivities in protecting national sovereignty;

  • Transferring competencies and power to the decentralized collectivities: actions limited to 260 communes due to the delay in allocating the MPRDAT’s operating budget in 2007. More efforts will be made in order to cover the remaining communes.

Challenges and Outlooks

  • Implementation of all actions in the area of public security included in the RRI by March 31st, 2008 at the latest;

  • Continuing the reforms, projects, and activities initiated in 2007, namely those related to transforming the judiciary system, including the Trade Court, or changing laws, namely those related to the revision of the Higher Council of Magistrates, custody, and the law on the Supreme Court;

  • Developing RRI in the target jurisdictions: processing the pending cases and improving imprisonment conditions in the penitentiary institutions;

  • Continuing the revitalization of penal camps;

  • Development of partnership among the different anti-corruption units: BIANCO, ZP, CSI, Anti-corruption Penal Chain;

  • Strengthening ownership of Anti-corruption Efforts (ACE) by regional officers: implementation of a regional ACE policy;

  • Improving the quality and the transparency of public services (front office): establishing and implementing the standards of minimum service;

  • Strengthening the performance of the BIANCO in processing cases investigated;

  • Setting up and making operational the institutional frameworks at the regional levels for reinforcing the management and the transparency of public finances: CDE, ARMP, Treasury, Budget;

  • Promoting the population’s participation in democratic life by building on and using e-governance tools;

  • Aligning the National Policy for Decentralization and Devolution to the MAP: part of its contents will be updated and harmonized with the challenges related to effective decentralization of the Administration;

  • Setting up as an urgent action Commune Support Centers for a group of given communes (for instance, one CAC for every 10 to 15 communes) by December 2008;

  • Developing a sense of responsibility to CAC to coach commune officers to accomplish their mission of sending information upward (namely, the administrative accounts and regular reports: only 25% sent their accounts of 2006);

  • Reinforcing mass communication to raise awareness not only among leaders and administrative authorities but among citizens living in the communes as well;

  • Building the capacities of communes through the Local Development Fund in order to achieve a high level of tax collection, which warrants the success of large scale social and economic actions to the benefit of the local population.


  • Recruit 1,000 policemen and policewomen per year, subject to financial support and the government’s authorization;

  • Achieve the maximal coverage of 119 districts in order to avoid distance management of security, through timely operations, including patrols of the general police;

  • Institute Behavioral Change Communication (BCC);

  • Intensify the awareness-raising campaign on corruption;

  • Increase the number of session on civics;

  • Reinforce effective collaboration between the partners of the Justice, such as BIANCO, CSI, bailiffs, lawyers, namely to accelerate the processing of cases;

  • Increase the share of budget allocated to decentralized collectivities (budget transfer) to allow for:

    • - increasing the staff at the CAC, at the Central Directorate for processing, analyzing, and using data and producing results;

    • - reinforcing the teams of each region by recruiting officers to be in charge of the Monitoring and Evaluation Units and the Information System;

    • - establishing the remaining CACs, which depends on two decisive factors: the communes’ will to set up associations of communes and the contribution of technical and financial partners;

    • - ensuring proximity monitoring and evaluation of actions conducted by each commune as part of implementing the MAP;

  • Make operational the Local Development Fund as soon as possible in order to build the communes’ capacities: control, inspection, monitoring, and evaluation of activities;

  • Reinforce the application of the Code of Public Procurement by training the concerned entities at the central and regional levels on the typical bidding documents, on public procurements techniques, and on the rules provided.

Commitment 2: Connected Infrastructures

The main objective under Commitment 2 is to have a connected Nation. The building of quality roads, railways, ports, and airports, the increased production of energy, the setting up of information technology systems throughout the country, the reliability of meteorological forecasts, the supply of safe water and sanitation all support the economic development process. As such, Commitment 2 provides logistical support to the other Commitments and has a cross-cutting character.

Analysis of the Quantum Leap

The following changes resulting from the implementation of Commitment 2: Connected Infrastructures were noted:

  • In 2007, the Road Authority of Madagascar (ARM) became operational as part of the institutional reforms within the Ministry of Public Works and Meteorology;

  • 1,382km of national roads were built or rehabilitated or benefited from regular maintenance works;

  • 8,251km of national roads benefited from current maintenance works;

  • The transport sector expanded in 2007 with an increase of 17.3% for the transport of goods and 13.3% for the transport of passengers.

  • JIRAMA had poor capacity in terms of energy production due to technical as well as financial problems;

  • The amounts of power installed in the form of renewable energy clearly increased thanks to the coming of independent electricity producers (private operators);

  • The population’s access to telephone has significantly improved;

  • Households’ access to safe water has slightly improved at the national level.

Analysis of Priority Indicators

National tar or dirt roads maintained in good/fair condition
Table 2:

Evolution of the main achievements in the area of road infrastructures from 2003 to 2007 (km)

article image
Source: MTPM

A clear increase was noted in the achievements in terms of road infrastructures from 2004 to 2006 with a total of 9,034km in 2004 and 16,755km in 2006. A slight decrease occurred in 2007 due to the closing out or suspension of funding. The current maintenance of national roads has a large place in the operations.

Year 2007 was a transition year for the Public Works department as the main programs were coming to their end. Results achieved in 2007 are summarized as follows: 48% of the paved roads have been maintained in good condition and 41% in fair condition. As regards dirt national roads, 10% have been maintained in good condition and 19% in fair condition. Forty percent (40%) of the communes can be accessed by road all year long. The objectives set for 2007 were achieved but the results are quite mixed as not even half of the infrastructures existing at the national level were covered.

The following projects/programs contributed to the results: the National Road Maintenance Program (PNER/ European Union Phase II, the National Engineering Structure Maintenance Program (PNEOA)/ European Union Phase II, The regular and current maintenance program funded by FER/RPI, the Project of investments in transport infrastructures (APL3) and the Integrated Growth Pole Projects (IG2P) on a funding from the World Bank, and Projects funded by the ADB and the BADEA. While the Ministry of Public Works and Meteorology made special efforts, 70% of dirt national roads and rural roads that connect 60% of the remote communes still suffer from the lack of maintenance.

Decrease in the average cost of good transport

This primary indicator was not available from the transport sector for 2007. However, a clear improvement of the sector’s performance was noted, with an increase of 17.3% for the transport of goods, and 13.3% for the transport of passengers 2. These results are due mainly to the improved quality of infrastructures, and the efforts made since 2004 in the area of transport infrastructures. They reflect also the positive trends in imports and the coming of foreign tourists.

The main Projects that contribute to the sector’s performance include the Projects for Investment in Transport Infrastructures (APL3) and the Integrated Growth Poles Project funded by the World Bank.

Decrease in the number of victims of road traffic accidents
Graph 9:
Graph 9:

Trends in the number of victims

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: MT and SNISE (Base 100 = 2006)

The evolution index of the number of victims, base 100 in 2006, decreased from to 111 in 2003 to 60 in 2007 against an objective of 91. The result is mainly due to the measures taken by the different authorities in charge of road traffic security.

Reliability of meteorological forecasts

The meteorological forecasts’ reliability rate of 65% planned for 2007 was achieved. The National Office for Disaster and Risk Management (BNGRC) has improved its timely interventions pursuant to the last cyclones and this has improved good and people’s security, as well as economic activities’ security in general.

Households’ access to electricity in rural and urban areas

Households’ access to electricity at the national level remains low, stagnating at about 45% in 2006 and 2007. This is mainly due to the suspension of new connections because of JIRAMA’s technical and financial situation (low productive capacity and non renewal of investments). This poor capacity is confirmed by the results obtained as regards rural electrification in 2007: out of the 100 localities planned, only 37 (i.e. 37%) received electricity. The poor performance is due to the freezing of the 2007 budget since July because of certain procedures and measures related to the decree setting up the ADER. The funding allocated from internal resources and the HIPC resources to rural electrification were transferred to the National Fund for Electricity. At this pace, the objectives set in the MAP as regards electrification, especially in rural areas, will not be achieved by 2012, which call for special actions.

As regards the evolution of cost of the electricity KWH from JIRAMA, tangible increases have been noted, namely 21% in 2005, 56% in 2006, and 6.3% in 2007 due to JIRAMA’s operating costs.

However, power installed in the form of renewable energy by independent electricity producers has increased from 88MW in 2006 to 91MW in 2007. The increase is mainly due to the coming of several private operators such as Henri Fraise, HYDELEC, ENELEC, and EDM.

The IG2P also contributed to making up for the failure of several power-generating units of JIRAMA.

Increased telephone penetration rate
Graph 10:
Graph 10:

Telephone penetration rate

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MPTC et SNISE

The objective of 11.4% as regards the telephone penetration rate in 2007 has been exceeded. Indeed, the rate increased from 1.9% in 2003, to 6.3% in 2006 and 12.22% in 207. The sector has been flourishing and the population’s access to this service has clearly improved. The institutional reform, the sector’s liberalization, and the development of competition in terms of quality of networks and services offered have largely contributed to these results.

The private sector’s participation through the extension of the National Backbone project for the Northern Part in microwave beam, for Toamasina-Antananarivo-Fianarantsoa line in optical fiber, and operation of the Toliara-Taolagnaro-Mananjary-Vangaindrano has contributed to the good performance despite financial problems among operators.

On the other hand, the evolution of telecommunications and ICTs has allowed for the emergence of small enterprises and new economic activities that have generated employments, thus contributing to reducing poverty (repair of cell phones, taxiphones, sales of phone cards, etc.)

However, according to the MDG Follow Up Report in 2006, the coverage rate is still low compared to the country’s total population on one hand and to the situation of other countries in the IOC, COMESA and SADC on the other hand.

Communes’ coverage with radio improved

The commune’s radio coverage rate increased from 28% in 2006 to 49% in 2007. The result was obtained through the actions taken to lift regions faced with disaster risks out of remoteness. The French Cooperation provided special assistance by setting up 90 satellite reception antennas (Band KU), 30 TV transmitters, and 35 FM radio transmitters.

Improved access to safe water and hygiene

The water and sanitation sector has now its National Program for Access to Safe Water and Sanitation (PNAEPA) covering the period running from 2005 to 2015. The National Water and Sanitation Authority (ANDEA) created in 2004 is now operational. Its mission consists in setting up an operation framework for consultation and a regulatory framework for the use of water resources.

Graph 11:
Graph 11:

Proportion of the population with permanent access to safe water

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001


It should be noted that the indicators published by the INSTAT on safe water supply and hygiene infrastructures under the MGDs are different from those of the Ministry in charge of Energy and Mines/Directorate of Safe Water and Sanitation due to differences in the definition of their indicators and their basis for calculations.

According to the MDGs Follow Up Report, in 2006, the proportion of the population who had access to safe water improved from 24% in 2003 to 29.5% in 2004 and to 39.6% in 2005. According to the data from the Ministry in charge Energy and Mines, the proportion increased from 36.48% in 2004 to 37.45% in 2005 and to 38% in 2006. The information for 2007 is not yet available. At this pace, the objective of 62%of the population having access to safe water by 2015, as part of the MDGs, will be achieved by 2012.

It should be noted that while the objective was to build 650 water points in rural areas, the actual result was of 1,345, including 539 built by various partners (Caritas, WaterAid, CARE Fihamy, SAF/FJKM, CRS, etc.) and 806 by the Ministry in charge of Energy and Mines in collaboration with UNICEF and the DSF. The IG2P developed the water networks in Nosy Be and Taolagnaro. In urban areas, the freezing of private connections and connections for public standpipes has impeded the water supply activities.

Graph 12:
Graph 12:

Proportion of the population with permanent access to hygiene infrastructures at the national level

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001


As regards sanitation, according to the MDGs Follow Up Report in 2006, the proportion of the population having access to an improved sanitation system increased from 44% in 2004, to 44.8% in 2008 and to 48% in 2006. The proportion of the population having latrines has slightly increased from 50% in 2004 to 51.5% in 2005 and 2006. In accordance with the information provided by the Ministry in charge of Energy and Mines, the proportion of the population with permanent access to hygiene infrastructures was of 53% in 2004, and 52% in 2005 and 2006. Achievements in 2007 include building 4,000 latrines against an objective of 5,000. Out of these, 3,935 were built by technical and financial partners on funding other than the PIP, and the remaining on a funding from the PIP/UNICEF.

In order to achieve the objectives set for 2012, efforts must be made, especially in the area of mobilizing funding, at the local, national, and international levels.

Completion Status of Commitments Taken During the Presidential Dialogue

Ongoing actions:
  • A planning to pay the arrears of the Ministry of Public Works and Meteorology has been established based on the credit allocated as internal resources and VAT. However, the lack of credit remains an obstacle.

  • The economical operation approaches (labor-intensive, local materials) have been integrated in the strategies and actions plans of the Ministry of Public Works and Meteorology.

  • Land has been made available to promoters in the sector of Energy.

  • The process for integrated management of safe water resources has been integrated in the National Program for Safe Water Supply and Sanitation for the period running from 2008 to 2012.

Immediate actions:
  • As regards the financial gap at the Ministry of Public Works and Meteorology, a funding by the European Union as part of the 10th EDF was signed and the credits APL2 and APL3 from IDA have been extended.

  • The Inter-regional directorate of Public Works in the region of Atsimo-Andrefana has been effectively reinforced in order to provide technical support to the regions.

  • Negotiations are in process for the effective application of weighing bridges as part of respecting and protecting public property;

  • The repression of perpetrators of serious bodily accidents in the transport sector has become effective.

  • The Electricity Sector Policy Note is developed.

Actions in three months
  • The Sector Policy Note that was prepared addressed the issue of consistency and harmonization among transport sector policies.

  • The thermal plants of Mandroseza (40MW), Mahajanga (13MW), and Toamasina (7.5MW) are operating.

  • The feasibility study on interconnection of the electric lines between Antsirabe and Ambositra and the feasibility study on the hydraulic plant of Valobe are completed.

  • The Administrative Secretariat of the PICOM Project is set in December 2007.

  • The Diorano Wash charter is approved by the Government.

  • The approval of the National Sanitation Policy and Strategy is in process.


  • For the Ministry of Public Works and Meteorology: repairing as an urgent action the damages caused by cyclones Fame and Ivan as they have seriously affected road infrastructures;

  • Optimizing the operation of the 40MW thermal plant in Mandroseza;

  • Finalizing the development works for the hydroelectric site of Sahanivotry, which is on track;

  • Developing the national telecommunication backbone;

  • Accelerating international connections through a submarine optical fiber connecting Madagascar to Eastern Africa and completing the study on the project of connection with La Réunion;

  • Setting up ICT technopolis in partnership with the private sector;

  • Ensuring national coverage with radio and TV;

  • As regards national access to safe water, providing safe water to an additional group of 7.2 million people at least by 2012, i.e. achieving an increase from 38% in 2006 to 65% in 2012;

  • As regards national access to basic sanitation infrastructures (latrines), achieve an increase from 52% in 2006 to 71% by 2012, allowing an additional group of 6 million people to have access to latrines by 2012.


  • Develop the cross-sector linkages between Public works and Transports in order to achieve the expected results;

  • Based on the indicators defined in the NIMES, standardize the indicators of the sectors of Transports, Energy, Water & Sanitation in close collaboration with the INSTAT in order to ensure the reliability of the statistical information generated;

  • Provide for operational mechanisms at the OMERT to facilitate coordination of information between the administration and the private sector as regards ICTs.;

  • Reinforce the institutional framework in charge of coordinating, planning, and ensuring monitoring and evaluation in order to discuss and negotiate with and mobilize technical and financial partners for additional funding for the water and sanitation sector;

  • Build the capacities of the private and public sectors to provide water and sanitation, especially at the regional level;

  • Disseminate the National Sanitation Policy and Strategy and raise awareness among the population as regards its implementation.

Commitment 3: Educational Transformation

The objective for 2012 is to ensure that all children have access to quality fundamental education, to develop a long-term vision for youth, and to provide the latter with the knowledge they need to thrive.

Analysis of the quantum leap

The educational system will be transformed to comply with world-class quality and effectiveness standards. Such a system would stimulate creativity, help students make their dreams come true, and provide Madagascar with the human resources needed to become a competitive nation and a successful player in the world economy. The transformation is expressed through:

  • an institutional change (strategy and legal frame) of pre-school education, which is in progress;

  • the reorganization of the primary fundamental education into 7 years;

  • the establishment of the LMD system in higher education.

Analysis of priority indicators

Slight improvement of the pre-school coverage rate in 2007

Pre-school education is generally focused on preparing children to enter primary school.

The pre-school coverage rate reached 7.1%, when the objective set was 7%. However, the attention granted to pre-school education is still insufficient. In most cases, it is only the privileged children, whose majority live in urban areas, where the cost of access is high, that benefit from the current system. There is also great need for human resources and trained staff.

Furthermore, the absence of a financial strategy for the implementation of the community centres development plan is a major impediment. In the past years, the Pre-school Activity Centers (PAC) created by the State with support from UNICEF, as well as the pre-school structures set up at the rural level, with support from the local communities, have for instance stopped operating.

It is planned to develop programs that are appropriate to pre-school and are consistent with those of the first year of the Preparatory Course. To fill out human resources, 530 educators received training, out of the 3,500 that are planned to be trained.

Improvement of the rate of children attending school at all levels
Primary education

According to the 2006 MDG monitoring report, the net rate of children attending primary school increased from 93.3% in 2004 to 96.8% in 2005, to go back to 96.2% in 2006. This trend suggests that the MDG objective of 100% of children attending primary school in 2015 will probably be achieved. Besides, up to 2007, the performance has steadied around 97%.

As part of the creation of a successful primary education system, the gross rate of children attending school has clearly fallen during the 04 last school years (2004-2007); the net and gross rates of children attending school are in fact expected to draw closer to each other, since the objective is to reduce the difference between the two rates, as much as possible A good performance was recorded in year 2007, with a gross rate of 122% against an expected rate of 126.6% and a net rate of children attending school keeping steady around 97%. Generally speaking, a slight disparity was noted between boys and girls, with a percentage of 123% among boys and 120.8% among girls. The following account for the progress made:

  • availability of the grades 1 to 7 matrices, of the 7th year graduation profile, and of the curricula’s draft;

  • standardization of entries in first year;

  • building of new schools and rehabilitation of closed schools (upon funding from AFD, OPEP, BADEA, JICA, BAD);

  • recruitment and training of teachers for the implementation of the 7 years primary education reform (FTI, AFD);

  • continuation of the allocation of school kits and textbooks (KFW, BAD);

  • granting of subsidies to alleviate parental contribution in registration fees;

  • subsidizing of teachers (Parents’ Associations);

  • equipment of teachers with pedagogical guides (BAD, JICA).

The variations of the gross and net rates of children attending primary school during the 2004-2007 period are presented in the following Graph.

Graph 13:
Graph 13:

Rate of children attending primary school

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MENRS, REF 2007 and SNISE, and MDG 2006
Secondary education

The rate of students attending secondary school depends on the primary school completion rate, which has been high during the past years. As such, a gross rate of students attending secondary school of 32.9% was recorded in 2007, exceeding the objective of 31%. In secondary schools, no discrimination relating to sex has been noted (the rate of students attending secondary school is of 32.8% among boys and 33% among girls). The improvement particularly owes to:

  • the increase of the number of first year students from 103,380 in school year 2005/2006 to 223,940 in school year 2006/2007;

  • the increase and improvement of the schools’ capacity through the building and allocation of new classrooms, upon funding from BADEA and the OPEP;

  • the granting of subsidies to teachers.

At the upper secondary level

The rate of students attending upper secondary school highly depends on the lower secondary completion rate. In year 2007, the gross rate of students attending upper secondary school reached 10.3% for an objective set at 8.4%. Several factors contributed to this performance:

  • the number of students in first year increased from 39,600 in 2006 to 49,800 in 2007;

  • several rural upper secondary schools were re-opened with support from the BADEA (63 rooms built in 5 upper secondary schools);

  • the upper secondary teachers’ capacities were built, in partnership with AFIDES and WWF;

  • the strategy for the ongoing training of upper secondary teachers was developed and the relating structure was implemented in partnership with TISSA/UNESCO.

Education completion rate at all levels
Primary Education

According to the 2006 MDG monitoring report, the primary school completion rate increased from 47% in 2004 to stick around 57% in 2005 and 2006, and then fell back to 54.3% in 2007. This rate has thus fluctuated a lot, without communicating a clear trend. The situation showed a lower internal effectiveness among boys, where the primary school completion rate amounted to 52.7% against 56% among girls.

Nevertheless, the rate of pupils repeating class has improved in the past years, decreasing from 29.9% in 2004, to 19.7% in 2006, and finally 17.5% in 2007. Given the situation, continuous efforts need to be provided to attain the completion rate of 85% by 2012.

Several partners contributed to the improvement of internal effectiveness through:

  • the recruitment and training of teachers (FTI, AFD);

  • the equipment of teachers with pedagogical guidebooks (BAD, JICA);

  • the creation of school feeding activities in vulnerable zones (PAM, NORWAY, FTI);

  • the distribution of Approach By Skills (ABS) Tools.

Graph 14:
Graph 14:

Primary school completion rate

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MENRS, REF 2007, and SNISE
Secondary education

In 2007, the secondary school completion rate amounted to 20.7% for an objective set at 21%. The high rate of students repeating class in rural secondary schools, resulting from the lack of skilled teachers for certain subjects, accounts for the difference between the actual rate and the objective. As part of the intensification of secondary education, the disparity between sexes is in the stage of disappearing (20.7% among boys and 20.8% among girls).

It must be noted that efforts were provided to train new teachers.

At the upper secondary school level

While the objective was set at 8.1%, the upper secondary school completion rate recorded in 2007 amounted to 8.3%. This result has been achieved owing mainly to the training of teachers, the recruitment of new teachers, and the improvement of the students’ setting of work (allocation of scientific and technical equipment).

Slight increase of the number of students per 100,000 inhabitants and rise of the number of annual Higher Education graduates

Facing the limited capacity of absorption (infrastructures, supervision, etc.) of public higher education, the situation was globally improved through the enhancement of the capacity of higher education private institutions. The number of students per 100,000 inhabitants increased from 286 in 2006 to 292 in 2007. An increase by 6 students per 100,000 inhabitants was therefore recorded, but the objective of 309 was not attained.

As of year 2007, the number of higher education graduates reached 6,568 for an objective set at 5,625, owing particularly to a more striking increase of the number of graduates from private higher education institutions. However, the proportion of female graduates (48%) remains lower than that of male graduates (52%). At the public university’s level, the following account for the results obtained:

  • the establishment of virtual libraries in the 6 universities and 2 Research Centers (CIDST, FOFIFA);

  • the recruitment of lecturers in the 6 Universities (32 new associate professors in different Human Medicine specializations and 47 new lecturers);

  • the signing of the Funding convention of the Madagascar Support to the Higher Education Reform Project (MSHER, upon funding from FSP).

  • the establishment of the LMD system in higher education: methodological and institutional changes have been drawn up. However, in order to successfully implement the changes, the challenge is to materialize the building of the human as well as physical capacities of the teaching staff and faculties, as well as monitoring and partnership.

Low levels of newly literate people

According to the MDG report, the literacy rate of people aged 15 and on increased from 59.2% in 2004 to 62.9% in 2009. Information is not available for year 2007, due to the periodicity of the Household survey.

For year 2007, the partial results obtained on the literacy education of adolescents/youth who are out-of-school and/or dropped out of school early, using the ASAMA and AFI-D method are still poor. The objective of 36,700 newly literate people is only achieved at 40%. Among the 14,350 newly literate people, 13,040 are adults and 1,310 are children.

It must be noted that 1,010 literacy teachers and animators out of the 1,400 planned, received training in 2007 and 12,150 reading and arithmetic books were produced.

Budget allocated to the Education Sector

The share of the full budget that is allocated to Education decreased between 2004 and 2006, falling from 23.41% in 2004 to 21.28% in 2005, and to 17.4% in 2006. In 2007, the budget portion increased to 22.7%, for an objective set at 21.65%. Although the budget increased in 2007, when compared to the GDP, the budget portion allocated to the MENRS (Ministry of National Education and Scientific Research) slightly decreased between 2005 and 2007, from 3.9% in 2005 to 3.8% in 2006, and 2.8% in 2007.

It must be noted that the MNESR has a poor capacity of absorption (internal funding in investment and operation) – 76.17% with 30.75% of investment expenses particularly. This poor capacity is associated with delays of budget implementation at the Ministry’s level and with the expenses regulation effect. In addition, there is slowness of implementation of some Projects, for instance the Primary and secondary education (OPEP), Education III (FAD Group), School rebuilding, Support to general teaching (BADEA).

The limited resources allocated by the State to public education may not create sufficient impetus to improve the coverage and internal effectiveness of the educational system.

Graph 15:
Graph 15:

Variation of the budget share allocated to education in comparison with the full budget and GDP.

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MENRS, MFB/PARP, and DSRP 2006

Completion status of the major committments taken during the presidential dialogue

Immediate actions:
  • Proposals on the design of the directions and instructions for carrying out the end-of-primary certificate constituted and ready to be handed over with the funds, to the 10 experimental RDNEs;

  • Making the decentralized organizations and the partners of Vocational and Technical Training responsible, through the adoption of a decree on the establishment of Regional Groups of Vocational Training and Technical Education Institutions (GVTTEI);

  • Rehabilitation of certain facilities that were affected by cyclones.

Actions in 3 months:
  • Development of model examination papers for the CEPE;

  • Computerization/Awareness-raising of Regional Organization Committees (COR) in the 10 experimental RDNEs;

  • Finalization of the document on setting up and making the National Training Agency operational.

Ongoing actions:
  • Documentary research, processing and analysis of the collected information, establishment of the terms of reference for holding a workshop on the future of official examinations (CEPE, BEPC, CAP/EP);

  • Development of the “teacher evaluation guide”;

  • Organization of the CEPE, CAP/EP/BEPC examinations;

  • Recruitment of 250 official teachers for upper secondary schools, of 2,000 official teachers and 5,000 non-official teachers of the primary cycle;

  • Selection of 2,800 semi-specialized teachers for the establishment of the 7-year primary education;

  • Decentralization of some of the duties at the level of the 22 RDNEs and 111 CISCOs: career management (promotion, integration, contract renewal, and others);

  • Establishment of the local commissions in charge of recruiting contractual teachers for upper secondary schools at the RDNE level;

  • Capacity building of RDNEs’ agents along with the installation of the career management software;

  • Awareness-raising of the population of the importance of literacy education for quality of life;

  • Census of illiterate people within communities and forwarding of statistics to relevant authorities;

  • Capacity building of decentralized services and collectivities as regards literacy to achieve sustainability.

Challenges and outlooks

  • Innovate content (analysis of examination papers) and organize (device) official examinations relevant to CEXAM;

  • Modernize the MENRS’ Human Resources Management;

  • Recruit teachers for the lower and upper secondary levels, based on needs expressed;

  • Establish 5 pilot facilities, based on demand;

  • Answer the skill needs of great projects;

  • Reconvert some Vocational Training Centers according to the needs of the regional markets (match training to job offers);

  • Develop training references on farming, hotel trade and catering and make trainings with professionals operational;

  • Establish national strategies to take literacy education to scale;

  • Establish a support fund to literacy education;

  • Modernize the management of universities through computerization;

  • Improve the quality of training to comply with international standards through gradual transition to the LMD system;

  • Develop Strategic Plans at the level of each university and research institution;

  • Turn some universities and/or research institutions into centres of excellence.


  • Perform a stabilization of the staff budgeted for at the MENRS;

  • Build the capacities of the MENRS (physical, human, and financial);

  • Accelerate the releasing speed of the staff budgeted for by the MFB;

  • Appoint 2,800 new semi-specialized teachers as early as the start of school year 2008-2009 for the reorganization of primary education into 7 years.

  • Build the capacities of teachers in evaluation for certification, based on the ABS in Grades 2 and 3, by equipping them with tools for asset evaluation;

  • Respect and enforce the evaluation reforms required by all relevant entities, at all levels;

  • Improve the diversification of innovative pedagogical methods and facilitate access to the methods through Distance Open Training (DOT);

  • Improve supervision at the universities’ level through the recruitment of new researcher teachers.

Commitment 4: Rural Development

Dynamic rural development and effective alleviation of poverty are at the core of the Government’s endeavours. Rural areas will thrive and prosper through a green revolution that will substantially increase agricultural production. Agri-business centers will be established in each and every region to assist in training and in the provision of farming resources such as irrigation, seeds, fertilizer, and storage facilities.

Analysis of the quantum leap

According to the 2006 Millenium Development Goals (MDG) monitoring report, about ¾ of the poor live in rural areas, where approximately 80% of the Malagasy population also lives. However, rural poverty decreased from 77.2% in 2001 to 73.5% in 2005 that is, a significant fall of 3.7 points over the period. The dynamics of the Malagasy economy’s structural transition has indeed benefited to the rural world: the increase of farm gate prices during the mentioned period has generated significant advantages for the rural people.

Graph 16:
Graph 16:

Variation of price indexes at the consumption of non-processed food products (NFP) or processed rice (PR) and variation of the rice production

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: BCM statistical information report

Because information on farm gate prices were lacking, we instead tried to analyze the price indexes at the consumption of non-processed food products (NFP), processed rice, and the variation of the rice production.

The primary sector’s growth is still precarious and has practically not changed over the past three years. While the average growth of the population amounts to 2.8%, the primary sector’s growth rate amounted to 2.5% in 2005, 2.1% in 2006, and 2.2% in 2007. A slight increase was noted in the agriculture sector, 2.6% in 2006 and 2.9% in 2007, but on the other hand, the breeding and fisheries’ growth rate decreased from 1.9% in 2006 to 1.7% in 2007.

To remedy to the slowness of poverty alleviation in rural areas, priority has been given to the reinforcement of the mainstays and levers for launching the «Green Revolution », particularly:

  • The promotion of market-oriented activities, diversification of agricultural activities by making certified seeds available and by distributing them, establishment of Market Access Centers (MAC), AgriBusiness Centers (ABC);

  • The diversification and improvement of the fishery production as well as the rehabilitation and building of exploitation infrastructures;

  • The improvement of land security, in the rural world more particularly, through the establishment of one-stop-shop and land offices and the attribution of land titles and certificates.

No change worthy of note was observed towards improving life conditions in rural areas. This essentially results from the poorness of the agricultural production, the poor state of the hydro-agricultural infrastructures, and the effects of climate change.

The close linkages that should exist between ABCs and farmers (grouped into associations), remain vague and are not materialized. The results are indeed mitigated, insofar as:

  • associations and/or “medium farmers” are long to emerge to supply “big farmers” in the chain value pattern of specific promising sectors (fruit and vegetables, milk, paddy, etc.);

  • the awareness-raising and mobilization of rural actors regarding the constitution of associations, have not yet reached cruising speed;

  • access to rural funding is still a major impediment, due essentially to the cost of credit;

  • besides climate hazards, insecurity in the rural world may reduce to nothing the efforts undertaken and calls for drastic and rigorous measures.

Analysis of priority indicators

The green revolution will allow for improving the non-productive areas of the farming world and the levels of income.

Slight increase of the proportion of rural operators holding land titles or certificates

In spite of the performance recorded at the end of the period, the rhythm of increase of the percentage of rural operators holding land titles or certificates, increased from 10% in 2008 to 10.24% in 2006, and 10.42 in 2007 (for an objective of 10%). However, compared to the objective of 75% set for 2012, this is very slow. Forty-seven (47) Communal land offices were indeed established as planned and 1,100 people received training on land management. As such, land security remains a big challenge.

Also, the cost of access to certification, which is unaffordable for some social strata, is the main barrier to the delivery of established land titles.

Clear increase of the rice production

The mainstays of the Green Revolution are reinforced. Concerning the rice production, in spite of the drought that occurred at the beginning of the campaign, the production of paddy, estimated at 4,010,189t, increased by 10.2% in 2007, compared to 6.4% in 2006. This increase essentially owes to:

  • An intensification of the use of agricultural inputs: the amount of fertilizer distributed increased from 7,357 tons in 2006 to 36,000 tons in 2007 and the seeds used, from 483 tons in 2006 to 2,650 tons in 2007;

  • The acquisition of 4,884 small agricultural equipment;

  • The development of a surface area of 100,660Ha for an objective set at 100,000Ha; the surface area suitable for cultivation is currently estimated at 1,300,000Ha;

  • The water mastery of 12,000Ha of rice fields;

  • The establishment of 58 demonstration showcases at the Communes’ level, to improve cultivation techniques.

The levers of the Green Revolution are also set and ready:

  • The National Chamber of Agriculture, the 22 Regional Chambers, the 32 Departmental Chambers, and the 70 Communal Chambers are operational;

  • The capacity building of farmers’ organizations is intensified;

  • The activities relating to the Agricultural Investment Zones (ZIA) have started.

Rise of the penetration rate of financial institutions

During the past three years, significant results have been obtained regarding the growth and development of Microfinance Institutions’ (MFI):

  • In terms of market penetration, in 2007, approximately 8.51% of Malagasy families are beneficiaries of the financial services offered by MFIs, compared to 6% in 2005. The coverage rate of Districts having operational financial institutions amounts to 70.43%.

  • On June 30, 2007, mutual and non-mutual MFIs had more than 317,281 members, including 38% of women.

  • The mutuals’ outstanding savings reached 33 billion Ariary and outstanding credit, more than 44 billion Ariary.

Yet, considering the scope of the role that the rural world is expected to play in the achievement of the MAP’s objectives, further efforts must be provided, because this penetration rate is still low. Besides, the establishment of the Agricultural Development Fund is not effective.

Diversification of the rural households’ sources of income

The present circumstances are calling for the diversification of productions. As such, specific actions have been taken to:

  • encourage farming operators to enhance the value of Malagasy quality and of added-value, export products. The volume of agricultural exports increased from 560 billion Ariary in 2006 to 636.7 billion Ariary in 2007;

  • prompt the farming population to take up dairy breeding and beekeeping, which can both be significant sources of income: the annual growth rate of the dairy production reached 8.04% in 2007 and 40 modern breeding farms, 36 of which own more that 10 cows, are now established;

  • increase the number of sectors that may be exported and will be a complementary source of income for the rural population: lima beans, chilli, cassava, fruits and vegetables;

  • support the emergence of a number of sectors that set the economy at promoting independence in energy and the diversification of agricultural export products: sugarcane, jatropha, bio ethanol, chilli, fruits and vegetables;

  • rationally manage productive spaces: the value of 10,880Ha of new areas of tanety was enhanced through arboriculture, food crops, pastureland, while the objective was set at 10,000Ha and 1,725Ha of catchment areas were developed instead of the 835Ha planned;

  • make 06 «AgriBusiness Centers » (ABC), 07 Market Access Centers (MAC), and 13 Agricultural Service Centers operational, to improve the organizational environment of producers. In this respect, the development of quality standards is a big challenge.

The average growth of the «fisheries and breeding »division remained slightly below 2% from 2005 to 2007. The same applies to the honey production, which reached 1.02% over the said period.

Contribution of programs and projects

  • The National Land Program (NLP) and the Millenium Challenge Account (MCA) made significant achievements in auditing land files and supporting land administration;

  • The Agency for the Implementation and Promotion of Microfinance (AGIPMF) opened and re-opened several cashes to achieve the objective of establishing proximity financial services that answer the needs of members, in spite of the fact that some networks were impedimentped by the poor drain of savings;

  • The National Coordination of Microfinance, funded by UNDP, conducted actions for the revision of the legal and regulatory framework, the supervision and control of sectors, and the capacity building of MFIs in particular;

  • The FIFAMANOR Support Project (dairy triangle) mainly reinforced the producers’ capacities at improving production techniques – dairy production more specifically;

  • The coverage rate of the Rural Development Support Project (RDSP) reached 71% of rural communes. The contributions of RDSP, of the Mandrare Upper Basin Project (MUBP), of the Irrigated Catchment Areas Perimeters Project, and the Rehabilitation of Lower Mangoky Project (RLMP) improved the support to productive investments, agricultural research, and the capacity building of farmers’ associations;

  • The Erosion Control Project, located in Marovoay, contributed to enhancing the value of tanetys, controlling bush fires, and developing catchment areas.

Completion status of the major commitments taken during the presidential dialogue

Immediate actions:
  • As part of the Green Revolution: participation of 30 agents of the MAEP in the popularization of rice production intensification and expansion techniques;

  • Importation of goats of meat and wool of higher quality;

  • Awareness-raising of butchers on hygiene standards in slaughterhouses and meat stalls;

  • Training of meat inspectors in the regions of Vakinankaratra, Analamanga, Upper Matsiatra, and Atsimo Andrefana;

  • Preparation of the fish farming development strategy;

  • Expansion of and training on pond, cage, or enclosure breeding of fish.

Actions in 3 months:
  • Delivery of 658 permissions for the importation of animal food products (AFP);

  • Improvement of the hygiene standards control on animal food products (AFP) and animal production;

  • Making legislative texts on animal health consistent.

Ongoing actions:
  • Development of the surveillance protocol of emerging diseases;

  • Locking up control of bovidae under transaction;

  • Technical orientation on the new sectors’ requirements;

  • Awareness-raising of operators on cage breeding of alevins, until processing;

  • Contact of financial (MCA, AMPA, FAO, etc.) and technical (task force for the development of cage breeding) partners;

  • Development of the steering plan 2008-2012;

  • Creation of fishers’ and fish farmers’ associations;

  • Establishment of MFIs in non-covered zones, defined through consultation between all stakeholders;

  • Research for fund donors and strategic partners.

Challenges and Outlooks

  • On the macro-economic plan, reduce the rural areas’ poverty rate by improving the resource allocation to this sector and by increasing the sector’s growth and share in the GDP;

  • Double to triple the food production, especially rice production;

  • Reinforce land security;

  • Develop and enforce a surveillance protocol of emerging diseases;

  • Provide technical orientation on the new sectors’ requirements;

  • See to it that farmers internalize the necessity of using inputs in their culture;

  • Develop the cage breeding and production of alevins.


  • Review and set higher all expectations relating to the priority indicators of the MAP’s implementation monitoring;

  • Promote the emergence of young rural entrepreneurs (medium farmers);

  • Actively research funding with financial partners to build the capacities of the MAEP;

  • Train trainers on hygiene standards, legislative texts on animal health, regulatory texts on cage and enclosure breeding, and the strategy for the development of fish farming;

  • Facilitate the establishment of associations of: fishers, fish farmers, breeders, farmers, etc.;

  • Facilitate the acquisition of the equipment necessary to the establishment of cage and enclosure breeding and the creation of traditional fishers’ or small and medium fish farmers’ associations;

  • Raise the butchers’ awareness on hygiene standards in slaughterhouses and in meat stalls;

  • Reinforce the improvement of the availability, quality, and reliability of agricultural statistics, in partnership with the INSTAT particularly: farm gate prices, production, number of associations, etc.;

  • Make the data relating to the number of research products available for the needs of the regional sector, to indicate the speculative specificities of each region of Madagascar (emphasis on the “chain value” principle).

Commitment 5: Health, Family Planning, and the Fight against HIV/AIDS

The main objectives of Commitment 5 are to promote maternal and child health by improving the population’s access to quality services, intensify the control of infectious diseases, fight HIV/AIDS, intensify the family planning strategy, and improve nutrition. Besides, by adopting the Millenium Declaration, Madagascar committed itself to achieve the goals of the Declaration. Three out of the eight Millenium Development Goals are directly linked to health, namely: the reduction of child mortality, the improvement of maternal health, and the fight against HIV/AIDS, malaria, and other diseases.

Analysis of the quantum leap

  • Greater management of the populations’ care through the enlargement of the care coverage;

  • better health coverage in child and women’s care: immunization, maternal aid, infectious diseases control;

  • reduction of the morbidity and mortality rates associated to malaria;

  • decline in the proportion of under-five children seen in BHCs and community sites that have a low weight;

  • reinforcement of the strategic and technical coordination of the actions for fighting AIDS, through the multi-sectoral approach;

  • making the equity fund operational for underprivileged people, resulting in the enlargement of the care coverage to the least privileged populations.

Analysis of priority indicators

Low rate of use of Outpatient Visits in BHCs

At 35.8%, for an objective set at 49%, the rate of use of BHCs’ Outpatient Visits remains low. The functionality of the newly built BHCs, particularly the lack of corollary staff and staff budgeted for, accounts for this poor rate. However, efforts were undertaken to improve the compliance of health facilities with standards and expectations in this area are by far exceeded by achievements: 120 BHCs were rehabilitated/built instead of 84, 05 maternity wards out of 05 were rehabilitated/built, and 96 BHCs were provided with material and equipment instead of 60, as planned. All health facilities were provided with quality medicines and quality perfusion liquid. The programs CRESAN 2 (funded by IDA) and SANTE 2 (funded by FAD) contributed to the Public health facilities’ and equipment’s compliance with standards. The absorption rate of the credits allocated is however very low. This is associated with the low compensation from the Government.

Satisfactory DTPHepB3 immunization coverage rates

Immunizations are the main measures for preventing target diseases as a whole, measles and poliomyelitis more particularly. To increase the immunization coverage, the availability of vaccine was ensured in health facilities, throughout the country.

In 2007, the DTPHepB3 immunization coverage rate among children under 1 was 87.10% for an objective set at 80%. Regarding other types of immunizations among children under 1, the immunization coverage rates are respectively: 97.5% for the B.C.G. and 94.4% for the anti-measles.

Variation of the immunization coverage during the past five years:

Since 2005, the immunization coverage has remained over 90%, after a significant decrease in 2004. The improvement of the child immunization coverage contributed to the substantial reduction of child and youth mortality in Madagascar. The good performances are the result of the absence of vaccine stock-outs, the implementation of outreach, and especially the awareness-raising actions undertaken. The cold chain coverage is close to 75% throughout the country. If current the trend is followed on and present efforts are maintained, the objective of 100% will be achieved by 2012.

Besides the State, several technical and financial partners contribute to supporting immunization by providing vaccines and cold chain equipment. These partners include: WHO, USAID, Rotary Club International, and UNICEF.

Graph 17:
Graph 17:

Variation of the BHCs’ outpatient visit rates and the DTPHepB3 immunization coverage rate among children under 1

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MSPFPS and SNISE
Downward trend of the child and maternal mortality rates

These two indicators reflect the impact of the actions undertaken to improve maternal and child health. Results are not available for 2007, because the evaluation of the indicators requires surveys that are spread out over five years (DHS) or two years (Household survey).

A few trends are however worthy of note: according to the 1st national MDG monitoring report, the mortality rate among children under 5 fell from 93.4 per thousand in 1997 to 58.0 per thousand in 2004. The high performances of the immunization coverage rates and the preventive measures taken to control malaria are just as many factors that contributed to this improvement.

According to the same report, the maternal mortality rate decreased from 488 per thousand live births to 469 per thousand live births in 2004. These figures indicate a slow progression. In spite of the rise of the contraceptive prevalence – which resulted in better birth spacing, the standardization of heath facilities, and the increase of their number, some major impediments remain, namely the low rates of deliveries at the BHCs and DHCs and the low rates of outpatient visits in BHCS, which result from the lack of medical staff.

Downward trend of the morbidity and mortality rates associated to malaria in BHCs and hospitals

Malaria ranks second in the causes of morbidity. According to the results of the Household 2001, malaria is the reason for 19.4% of outpatient visits in BHCS. The morbidity rate associated to malaria at the BHC level was reduced to 11.1% in 2007 for an objective of 15%. During the past 5 years, this rate has tended to decrease, as shown on the following figure:

From 2003 to 2005, the morbidity rate associated with malaria in BHCs varied from 18.8% to 16%, it slightly increased in 2006, and went down to 11.10% in 2007.

Regarding the mortality rate associated with malaria in hospitals, the objectives for 2007 were exceeded with a result of 15.64 against an expected rate of 15.70%. During the 4 past years, this indicator remained steady, with rates varying between 16.5% and 17.5%.

Graph 18:
Graph 18:

Variation of the malaria morbidity rate in BHCs and the malaria mortality rate in hospitals

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MSPFPS and SNISE

The promotion of insecticide-treated bednets, the improvement of the disease’s management, and the improvement of the health system in collaboration with Global Fund, WHO, and CRESAN, are all factors that contributed to obtaining these results. As regards prevention, the distribution of Long-Life Insecticide-Treated Nets (LITN) to pregnant women as well as their sale at affordable prices, as part of social marketing has resulted in increasing the population that has access to these bednets: 2,910,000 LITN were distributed free of charge against an objective of 2,100,000 and 2,016,436 were sold at affordable price.

Clear improvement of the rate of curing from bacillius Tuberculosis

The objective set for 2007 is largely achieved with an actual rate of 78.00% for an expected rate of 72%. During the past 04 years, results indicate a positive change with the rate’s increasing from 66% in 2003 to 71% in 2004, 75% in 2005, and 78% in 2006. This improvement owes to the decentralization of tuberculosis control and the increase of the number of Screening and Treatment Centers.

Substantial efforts must still be provided in screening the disease and monitoring patients, because many of them are often lost of sight.

Graph 19:
Graph 19:

Variation of the rate of curing from bacillius tuberculosis

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MSPFPS and SNISE
HIV prevalence among pregnant women

Sexually transmitted diseases are known to be a major factor of HIV propagation.

Since there has been no national survey, this prevalence will be assessed against partial results. The setting of objectives regarding the number of HIV-positive pregnant women and People Living with HIV (PLHIV) is based on the trends of the preceding years.

Due to the strong prevalence of syphilis among pregnant women, specific actions were taken to improve the means of preventing mother-to-child transmission. Likewise, the monitoring of people under Anti-RetroViral treatment (ARV) has been reinforced.

The strategies initiated pertained to the reinforcement of decentralization, program management for a local response to STIs and HIV/AIDS, the intensive campaign held at national scale for behavior change and society’s awareness-raising, and the capacity building of physicians. The following achievements were made in improving access to and use of STI/HIV/AIDS prevention and management services:

  • Prevention of Mother-to-Child Transmission (PMCT) sites were made operational;

  • Allocation of laboratory reagents and medical consumables was conducted;

  • HIV-positive pregnant women were managed.

The response to HIV and AIDS is strongly supported by the President and are expressed through a multi-sectoral strategic approach and a local response. Several donors are contributing to the fight through UNOAIDS, namely UNDP, UNESCO, FNUAP, WHO, the World Bank, BIT and WFP.

Although the prevalence is relatively low (less than 1%), it may be increased by the fact that the STI prevalence is high and that the population has numerous risky sexual behaviours. Also, the HIV epidemic is classified as little active, but it shows a tendency to generalization.

Percentage of people under ARV treatment who are still alive 12 months after starting the treatment

The monitoring of this indicator, which has been newly introduced, is not yet mastered. Several actions have however been conducted in this area, namely:

  • the psycho-social and medical management of PLHIV;

  • making PLHIV reference centers operational.

It must be mentioned that regarding the monitoring of people under ARV treatment, some PLHIV are lost of sight or even deceased. Outlooks for 2008 consist in conducting a survey on HIV prevalence among pregnant women and a biological surveillance survey to reinforce control and prevention measures.

Challenges include:

  • maintaining the HIV prevalence rate below 1%;

  • effective decentralization of the response to HIV/AIDS;


  • Reinforce effective collaboration between SE/CNLS, the MSPFSP, and partners under the STI/HIV/AIDS program, in decentralizing the program’s management and in conducting surveys;

  • Use the National Strategic Plan as a reference for the development of regional plans for HIV/AIDS control;

  • Use the monitoring-evaluation plan as a reference for monitoring responses.

  • Make the accessibility of condoms and all services linked to reproductive health effective;

  • Reinforce PLHIV management and psycho-social services.

  • Increase the number of PLHIVs treated among people under ARV treatment.

Extremely satisfactory contraceptive rate

The partial result obtained for year 2007 (from a reporting rate of 54.85%) is 19.30% for an objective of 19%. The percentage of Family Planning (FP) services users has always satisfactorily increased.

FP use was promoted on one hand by the availability of FP services and on the other hand, by the building of knowledge on contraception. It must be noted that the access to modern contraceptive methods was improved and the number of FP sites increased.

The promotion of Family Planning is supported by the country’s High Authorities. From 2003 to 2007, the contraceptive coverage rate has almost increased fourfold. Hundred percent (100%) of functional public health facilities have become FP sites and 111 District Health and Social Affairs Services (DHSAS) are supplied with contraceptive products.

FNUAP is the main partner that supports the reproductive health program in Madagascar. The success of the program is reflected by the high outlay rate of the planned funding.

Little change of the delivery rates at the BHCs and DHCs level

A slight improvement of the situation was recorded in the past years: from 24.2% in 2003, the indicator increased to 26.10% in 2006 after decreasing at 19.6% in 2005. In 2007, the result obtained amounts to 25.20% for an objective set at 25%.

The management of deliveries is low because the community lacks knowledge on danger signs and therefore fails to resort to the services on time and there is insufficient service offer.

The Ministry of Health, with the collaboration of external partners, including FNUAP, UNICEF, WHO and GTZ provides considerable efforts to reinforce Emergency Obstetrical and Neonatal Care (EONC) services on its own budget. However, most health workers are not equipped with the skills needed for EONC. Finally, developing of a maternal and neonatal care program using a community-based approach would be very challenging.

Graph 20:
Graph 20:

Variation of the contraceptive coverage rate and the delivery rate in BHCs and DHCs

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MSPFPS and SNISE
Budget allocated to the Health Sector

The share of the full budget that is allocated to the health sector has continuously decreased from 2004 to 2006, falling from 8.34% in 2004, to 7.89% in 2005, and 7.50% in 2006. However, it slightly increased to 8.80% in 2007. Taken in terms of GDP percentage, it amounted to 1.30% in 2004, increased to 1.63% in 2006, and decreased back to 1.51% in 2007.

It must however be noted that the absorption capacity of the MSPFPS (domestic funding for operation and investment) remains average (73.38%) with investments reaching only 51.95%. This performance is linked to the lateness of budget implementation at the Ministry’s level and to the expenses regulation effect. Slowness was also noted in the financial implementation of Programs/Projects such as SANTE 2, Multisectoral Program for the Prevention of AIDS, Nutrition II, CRESAN 2, Infectious Diseases Control.

Given the importance given to role of DHSs as proximity services, the budgets allocated to them continuously increased, from 54.07% of the MSPFPS budget in 2004 to 58.8% in 2007.

Graph 21:
Graph 21:

Variation of the budget share allocated to the health sector compared to the full budget and the GDP.

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: MSPFPS
Malnutrition rate

Malnutrition is a public health issue and affects a great majority of the population. In 2007, information on malnutrition rates was not available, because such information is subject to a subsequent DHS survey. Malnutrition was therefore assessed using indicators on low weight among children under five.

Clear improvement of the proportion of under-five low weight children seen on outpatient visits at BHCs

The objective set for 2007 was achieved with a result of 14.07% for an expected rate of 15%. Several actions contributed to this success, including:

  • the reinforcement and consolidation of malnutrition control activities at the school level through food support in CISCOs;

  • the creation of temporary jobs (food for work/ labor intensive) to prevent food and nutritional crises during lean periods.

Graph 22:
Graph 22:

Variation of the proportion of under-five low weight children seen on outpatient visits at the BHCs

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MSPFPS and SNISE

The proportion of under-five low weight children has clearly regressed in the past five years, falling from 16.90% in 2003 to 15.6% in 2006.

Significant decrease of the proportion of under-five low weight children seen at NNO community sites

In 2007, the low weight prevalence rate among children under five in community sites reached 25.4% while the objective set was 38%. The duplication of community sites is a sustainable strategy for controlling malnutrition.

Although community mobilization is critical to the program’s success, the perception of malnutrition issues requires further advocacy at the decision-makers’ level.

The adoption of the National Nutrition Policy (NNP) in 2004 and the establishment of the National Nutrition Office (NNO), under the supervision of the Prime Minister’s Office, as the coordination body of the interventions and interveners, have allowed for capitalizing all efforts and assets for better synergy and complementarity of action.

Several programs, such as PNNC/SEECALINE and CRS among others, conducted in collaboration with Ministerial Departments contributed to the control of malnutrition by establishing community sites, deworming children, providing iron supplementation to primary school pupils, and promoting school feeding, with support from technical and financial partners (World bank, UNICEF, WFP).

Completion status of the major commitments taken during the presidential dialogue

Immediate and ongoing actions
Cross-cutting actions:
  • Establishment of the National Committee for Human Resources Management (NCHRM) and the Regional Committee for Human Resources Management (RCHRM) for the decentralization and management of human resources;

  • Six paramedical training centers are already established in the 6 former provinces, but the availability of resource people and practicum structures complying with standards are still to be developed;

  • Development of the decent behavior code at the University Hospital Center, HJRA;

  • Existence of a duty tower in BHCs, to ensure access to care;

  • Establishment of a monitoring committee at the DRSPFPS level to monitor the implementation of the commitments taken during the presidential dialogue at the regional level;

  • Use of the Malagasy language for communication;

  • Establishment of competent teams at the development and negotiation stage: strategic reflection group established at the central and regional levels;

  • Increase of the budget share allocated to the health sector, refer to the Budgetary conference;

  • Allocation of funds only upon presentation of supporting documents to ensure that it is possible to track the funds’ circuits, including their use;

  • Advocacy with donors: action planned during a joint review;

  • Advocacy for the creation of the budget for 3P: involving NGOs in the monitoring of physical achievements;

  • Beneficiaries’ mastery over the donors’ procedures;

  • Leadership in the coordination of forums and sectoral reviews ensured by the MSPFPS;

  • All actors concerned are involved in and made responsible for the integrated development of health;

  • Distribution of the preventive and curative roles among State structures and other interveners: this is defined in the partnership convention, but the dissemination of the concerned NGOs and associations’ conventions is insufficient;

  • Orientation of all ORDSED and State credit managers on efficient resource management procedures;

  • Elimination of major infectious diseases;

  • Reinforcement of IEC on the use of ACT or anti-malarial drugs; these are integrated in the performance of District community workers;

  • Establishment of the Health Input Integrated Action Program (HIIAP) as part of the integration in the SALAMA circuit and the dispatching of supplies;

  • Supply of BHCs according to their needs;

  • HIV preventive measures and screening promoted at the corporate level as part of the company’s own domestic STI/HIV/AIDS control policy, in compliance with the national strategic plan;

  • Signing of the partnership convention between the MINSANPFPS and SE/CNLS for an allocation of local AIDS control committees (CLLS) and a task force;

  • Establishment of a task force for HIV/AIDS control in the 22 regions: convention between the MSPFPS and SE/CNLS established;

  • Signing of partnership conventions between the MSPFPS and SE/CNLS to facilitate the CBOs’ animators’ access and for the consideration of technical aspects (Counselling and Voluntary Tests);

  • Establishment of a regional coordination unit in the 22 regions;

  • 750 Health Facilities integrate HIV counselling and voluntary test in 2008, as part of improving the population’s access to prevention services;

  • Integration of health actions in Communal Development Programs to facilitate collaboration on planning and raising awareness on health activities, such as immunization;

  • Popularization of national and international texts on women’s rights in the Project’s intervention sites.

Challenges and outlooks

Integrate different actors in the implementation and monitoring operational plan of the commitments taken during the presidential dialogue; mobilize resources for the implementation of the commitments within time limits.


  • To officers per level: develop an implementation operational plan for the commitments taken during the presidential dialogue; ensure implementation within time limits and develop self-monitoring and self-evaluation of the commitments at each entity’s level.

  • Improve the quality and reliability of statistical information, through close collaboration between the INSTAT and the MSPFPS: support to the definition and calculation of indicators, etc.

Commitment 6: High Growth Economy

The Madagascar Action Plan counts on an economic growth of 7 to 10% until 2012, through the revitalization of the private sector in a climate conducive to investments.

Analysis of the Quantum Leap

  • The Economic Development Board of Madagascar (EDBM) has become operational and subsidiaries have been established in the poles of Taolagnaro and Nosy Be.

  • The reforms on public revenues and expenditures management as well as the organization of the control bodies were continued.

  • The new public procurement procedures have been implemented.

  • The new organic law on public finances has become effective.

  • The investment act has been developed and promulgated.

Analysis of indicators

Steady macroeconomic stability and economic activities influenced in many ways by the developments of globalization
Increase in economic growth and investments, including FDI

The international context for year 2007 was mainly marked by a steady though moderate growth, the sharp increase in oil price, by the depreciation of dollar against euro, and by the drop in the price of basic commodities. All of these had diverse influences on the national economy. However, overall, the trends in the big indicators have been positive.

Graph 23:
Graph 23:

Changes in macroeconomic values

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Sources: MECI/DEEM

The economic growth rate has remained above the demographic growth rate of 2.8% per year, increasing from 4.6% in 2005 to 6.2% in 2007 against an objective of 5.6% (an average of 5.0% over the last three years). This is mainly due to private investments estimated at 12.3% of the GDP in 2005, 14.7% in 2006 and finally 20.7% in 2007.

The trends in economic growth has strengthened the restructuring of the economy towards the tertiary sector, with this sector’s performance increasing from 7.1% in 2006 to 7.7% in 2007, mainly because of the sub-sectors of transport, telecommunication, and tourism.

Graph 24:
Graph 24:
Graph 24:

Sector structure of the GDP (at factor cost)

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001


Despite internal as well as external shocks (cost of oil, power shortage, decrease of productivity due to competitors), the secondary sector managed to achieve a performance of 9.9% in 2007 against an average of 3.5% during the 2005-2006 period, mainly because of the performances of the Free Export Processing Zones and food processing.

Growth in the primary sector remains low at 2.1% in 2006 and 2.2% in 2007.

As regards foreign direct investments (FDI), the sector of “extractive activities” accounted for almost 95% of the total flows of investments in 2007. Four countries rank as the main investors in this sector, namely Canada with 48.9%, Japan with 19.3%, South Korea with 19.3, and the USA with 8.3%. France has lost in ranking in 2007. However, France has a special position as it is present in almost every sector. Japan and Korea’s presence has been especially marked in 2007.

Graph 25:
Graph 25:

Flows of FDI per country of origin

(in billion ariary)

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: BCRM

FDIs have started massively flowing in the country in 2006. This phase could keep on going and would allow for achieving the gross investment rates needed to sustain a steady growth until 2012.

However, there remain some problems that may still discourage FDIs in Madagascar:

  • While potentialities for investments in Madagascar are presently numerous, the flow of capital from the countries in the Southern African Development Community (SADC) and the Common Market of Eastern and Southern Africa (COMESA) remain low.

  • Efforts must be made in the area of power supply in order to meet the needs of investors.

Graph 26:
Graph 26:

Net flows of FDIs

(million of SDR)

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Graph 27:
Graph 27:

Developments in Investments

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Control of inflation and budget deficit
Decrease in the inflation rate

The control of money supply growth through diverse indirect regulation instruments3 as well as the enforcement of budget policy oriented on reducing deficit has resulted in a slow down in the internal inflation rate4. From 11.4% in 2005, it decreased to 10.8% in 2008 and finally dropped at 8.2% in 2007 (end of period), despite the influence of unfavorable factors related to the economic situation such as the sharp increase in oil and rice price on the international market, the fluctuations of the ariary, the inadequate supply of energy, and climatic hazards. Thus, the objective of 10.1% in 2007 was overachieved.

In 2008, the objective as regards the money policy is to maintain inflation at a one-digit rate by the end of the year despite the difficult context. Over the next three months, the banks’ liquidity will be actively controlled through interventions on the money market while the rate of compulsory reserves and the reference rate will remain unchanged and the interest rates on the money market will be maintained at their current levels.

Increased fiscal pressure and drop of budget deficit

The fiscal pressure rate of 11.4% in 2007 is 0.5 point above the set objective of 10.9%. This contributed to improving the budget deficit which dropped to 2.8% of the GDP against a forecasted 4.7% over the period.

This performance was due to the followings, in particular:

  • a tight budget policy consisting in decreasing public expenditures of 2.7 points compared to the total expenditures in 2006 and of 2.1 points compared to the objective of 2007;

  • regulation of expenditures based on tax revenues;

  • improvement of public finances management by building the capacities of customs and tax departments.

Constraints on investment climate perceived in different ways by investors
Madagascar ranked 131st, 155th, and 149th country out of 175 countries respectively in 2005 and 2006 in the Doing Business ranking.

A study on a sample of 293 manufacturing enterprises conducted by the consultant firm ATW in collaboration with the World Bank in 2005 based on a comparative analysis with similar and competitive countries pointed out some assets and weaknesses in relation with the investment climate in Madagascar:


  • Competitive hand labor cost;

  • Competitive average time spent on custom clearance for both imports and exports;

  • More favorable access to short-term and commercial credit


  • The burden of red tape and corruption (long delays in processing requests, etc.)

  • Difficult access to long-term credit and high cost of security;

  • Higher taxation rates that are difficult to manage;

  • Higher indirect costs due to inadequate infrastructures: unreliable power supply, inadequacies in the supply chain, inadequate transport network, and sub-optimal water supply services.

The study also showed wide variations in the perception of the constraints based on the type of enterprises surveyed:

  • A high percentage of free export processing enterprises, national enterprises, and non exporting enterprises consider control on prices, inflation, an macroeconomic instability as major constraints;

  • Enterprises out of free export processing zones, small enterprises, and national enterprises seem to be the most affected by the cost of credit. In addition to non exporting enterprises, they are the ones that are the most concerned by the credit access issue.

  • A big proportion of free export processing enterprises and very large size enterprises think that uncertainties in regulations are a major obstacle.

In addition, in reference to the assessment of business climate by Doing Business, from 2005 to 2006, there have been improvements as regards the aspects related to business creation, the tax and duty payment condition, and the transborder trade conditions. Land tenure in Madagascar is seen as one of the most difficult issues compared to other reference countries. However, it should be noted that Madagascar has undertaken major structural reforms until 2007 in order to improve the business climate, especially the investment climate, through the followings:

  • Adopting the competition act as well as the law on the general guarantee for investors through the country’s accession to the Mutlinational Investments Guarantee Agency;

  • Signing the Agreement setting up the African Trade Insurance Agency;

  • Setting up the one-stop shop for Investments and Enterprises (GUIDE);

  • Creating the Economic Development Board of Madagascar (EDBM);

  • Signing Agreements for Investments Promotion and Protection (bilateral agreements or with union of groups).

Small amounts of long-term bank credit granted to the private sector

The amounts of credit banks increased from MGA609.95 billion in 2003 (out of which MGA604.10 billion was allocated to the private sector) to MGA1,043.08 billion in 2005 (out of which MGA1,034.22 billion was allocated to the private sector) and to MGA1,431.53 billion in 2007 (out of which MGA1,406.21 billion was allocated to the private sector).

As of December 2007, the credit granted to the private sector was distributed as follows: 62% was short-term credit, 31.16% medium term, and 6.84% long-term. From 2005 to 2007, the amount of bank long-term credit received by the private sector has kept on increasing, the increase rate being 24% from 2005 to 2006 and 64% from 2006 to 2007. However, the amount of this type of credit remains small compared to the total amount of credit granted by the system, thus limiting the investment capacity of local enterprises.

Table 3:

Annual evolution of bank credits

(in billion ariary)

article image
Source: BCRM

Moreover, the results of the study made by the World Bank in 2005 on the investment climate pointed out to the following main difficulties in accessing credit:

  • High cost of credit;

  • High cost of collaterals required;

  • Complex loan request procedures.

Graph 28:
Graph 28:

Long term bank credit granted to the private sector

(% of total credit)

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: BCRM

In addition, the dynamics in microfinance institutions – a source of potential funding to support small private enterprises’ initiatives, has improved only in the last years with a use rate of 1% before 1990, 6% in 2005, and 8.51% in 2007.

External situation controlled
Increase in goods exports, external deficit, stabilization of exchange rate and currency reserves

On average, the country’s export over the last three years increased by 11.6%. This is due more to the expansion to regional markets for traditional products with comparative advantages than to the extension of outlets for non traditional products. In terms of face value, they increased from 673.2 million SDR in 2008 to 808 million SDR in 2007.

Nevertheless, the trend towards a deterioration of the trade balance remains an impediment, the trade balance deteriorating from -1,0% in 2006 to -2.4% in 2007:

  • Decrease of 1.2% of export price in terms of foreign currency;

  • Increase of 9.9% Of import price due to the sharp increase in oil price;

  • Increase of 16.7% in equipment goods price and 8.6% in raw materials’ price.

The deficit of the external current account, including grants, increased from -8.7% of the GDP in 2006 to -14.1% in 2007 due to the sharp increase in imports (equipment goods pursuant to investments, especially in the mining sector).

The flow of external aid in various forms – direct budget aid, aid through project, debt cancellation as part of the Initiative for Multilateral Debt Relief, has allowed for reconstituting currency reserves at a level of 2.9 months of goods and services imports in December 2007.

The big fluctuations of the Ariary in 2004-2005 are now past history. The exchange rate for ariary against SDR (average over the period) has become stable, and the ariary has even started appreciating in 2007. The appreciation was especially marked against the US dollar (10%) and more moderate against the euro (5.0%).

A downward trend as regards the ratio of foreign debt service against exports

Over the last four years, Madagascar foreign debt service has been on a downward trend, decreasing from 49 million SDR in 2004 to 13.99 million SDR in 2007 (including 6.59 million SDR of principal and 7.4 million SDR of interest). The trends results from the increasingly significant amounts of debt relief received over the periods, the most important ones coming from multilateral and bilateral donors. In the same way, the ratio of debt service against exports has kept on decreasing from 9.23% in 2002 to 1.7% in 2007.

Regression in mineral duty collection
Low rate of mineral duty collection

In 2007, the mineral duty collected amounted MGA252.5 billion against MGA289.1million in 2006 and MGA339.8 million in 2005, which gives decrease rates of 12.7% from 2006 to 2007 and 25.7% from 2005 to 2006. This may be due to the late collection of data at the lower levels, on one hand and to the decrease in the price of precious stones such as sapphire or rubies on the international market since 2006, on the other hand. It should be noted that there is a lack of organizational mechanisms to improve governance in this sector.

As the sector’s performance is mainly assessed by the increase of FDIs, and given that the current investments of QMM-Rio Tinto in ilmenite in Taolagnaro and Sherrit in nickel and cobalt in Ambatovy are still in the investment phase, the expected social and economic impacts are not yet tangible.

Graph 29:
Graph 29:

Mineral revenue

(in million ariary)

Citation: IMF Staff Country Reports 2009, 010; 10.5089/9781451825473.002.A001

Source: MEM
Improved performance of the tourism sector
Increase in tourism revenues, number of tourists and direct employments generated

The sector of tourism constitutes a lever for the country’s development. In 2007, according to the economic situation note (Division of Economic Studies and Modeling/MECI), the tourism’s performance was good: a clear increase of the number of non resident visitors was noted, from 227,052 in 2005 to 311,730 in 2006 and 344,348 in 2007; the income generated increased from 124.0 million SDR in 2005 to 157.7 million SDR in 2006 and 211 million SDR in 2007; in addition 1,956 new employments were created. These results were obtained thanks to an increase in the accommodation capacity: with 164 new tourist enterprises and 1,409 new hotel rooms.

Table 4:

Trends in the indicators of tourism

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Source: MEEFT

Contribution of the Main Projects

The USD12.5 million guarantee fund set up by the Integrated Growth Pole Project (IG2P) and the International Finance Corporation in September 2006 to guarantee up to 50% the credits granted by BNI-CA and BFV-SG to Micro, Small, and Medium Enterprises (MSME) has allowed the two banks to grant USD14.6 million to enterprises as of December 2007, thus exceeding the set objectives. The amount is made up of 848 credits, with 568 granted by BNI-CA and 280 by BFV-SG.

In addition to the support to banks, IG2P also contributed to the performance of other sectors, namely:

  • Implementing training programs for MSMEs to build the private sector’s capacity and the intensive capacity-building programs in local governance;

  • Rehabilitating infrastructures and equipment to improve public services and the living conditions of the local population;

  • Building major infrastructures that have a structuring effect on economic growth;

  • Rehabilitating of safe water supply networks and solving power supply problems;

  • Providing operational and strategic support;

  • Providing support to the tourism sector.

Two major projects contribute to the development of the mining sector:

  • As regards the Project for the Mining Sector’s Institutional Reinforcement (PRISM), the results are fairly satisfactory. The main activities – building the mining administration competence and updating geological and mining information, were completed but the activities to support the private sector in processing mining products and in extractive activities were not done.

  • As regards the Mining Resources Governance Project (PRGM), the setting up of regional environmental units was a significant achievement. Conversely, the actions to support the decentralized management of mineral resources were not satisfactory.

Completion Status of the Commitments taken during the Presidential Dialogue

Ongoing actions:
  • 244 enterprises were controlled as regards the payment of the tourist duty.

Immediate actions:
  • Measures were taken to facilitate investments in building hotels of a standard of at least 3 stars.

  • The members of the 12 Chamber of Commerce and Industry were elected.

Short-term actions:
  • The Tourism Code has been effectively revised in collaboration with the World Bank.

  • Official launching of Success Stories (entrepreneurs’ competition): Business Plan SAHIA 2008

Challenges and Outlooks

Investment climate
  • As regards taxation, the tax exemption and relief granted to free export processing enterprises could be rebalanced in order stimulate new investments;

  • As regards regulations, they should be streamlined in order to reduce opportunities for corruption;

  • As regards infrastructures, the high indirect costs due to inadequate infrastructures (public utilities, supply chain, and transport especially) are to be decreased.

  • As regards finances, access to credit is to be expanded and the cost of accessing credit reduced.

Foreign Direct Investments
  • Increase the amounts of FDIs with high value added and giving more importance to employment-generation.


  • Implement the new system for collecting data on mineral duties at the lower levels;

  • Strengthen support to the private sector in processing mining products and in extractive activities;

  • Implement the actions to support the decentralized management of mineral resources;

  • Reinforce the effective implementation of mining governance;

  • Accelerate the progress towards the exploitation phase of the major mining projects while respecting local communities and environment.

Foreign Direct Investments
  • Promote and orient FDIs towards the exploitation of resources other than mineral ones in order to develop the other sectors and strengthen competition.

  • Build the capacity of the Center for Research, Studies, and Support to Economic Analysis in Madagascar (CREAM) to conduct an assessment of trends and the multiplier effects of FDIs.

  • Rehabilitate, as an urgent action, the hotel facilities destroyed by cyclones Fame and Ivan in order to be ready for the next tourist season.

  • Initiate discussions to reinforce linkages of tourism with other sectors, especially Public Works and Transport, Environment, Telecommunications and Communications.

Commitment 7: Cherish the Environment

As part of implementing the “Madagascar naturally” vision, the State decided to:

  • increase the surface area of protected areas from 1,700,000Ha to 6,000,000Ha that is, by more than 250%.

  • keep its 9,000,000Ha of forest and wetland areas for the conservation of its natural riches and the use of its forest, lake, marine, and coastal resources;

  • increase the reforested surface area from 360,000Ha to 540,000Ha that is, by 50%.

According to the MDGs, the following conditions must be met to ensure the sustainability of the environment:

  • the principle of sustainable development needs to be integrated in national policies;

  • the current trend that would lead to the loss of environmental resources needs to be reversed.

Analysis of the quantum leap

Environment is currently integrated in the larger vision of sustainable development and poverty alleviation policy.

Overall, significant results were obtained and are materialized by:

  • The increase of the proportion of Protected Areas (PA) from 2.9% in 2004 to 8.2% in 2007.

  • The combined efforts for maintaining the forest’s surface area and promoting reforestation actions;

  • The mobilization of funds for the Protected Areas and Biodiversity Foundation of Madagascar (PABFM);

  • The reinforcement of environmental control systems.

Nevertheless, the MDGs monitoring report indicates that the proportion of forest area has stagnated around 22.6% between 2004 and 2006. In the nineties, the deforestation rate in Madagascar amounted to 0.82% per year. This rate fell back to 0.55% per year from 2000 to 2005. The regions holding the highest deforestation rate are Itasy and Vakinankaratra.

Analysis of priority indicators

Perceptible increase of the Protected Areas’ (PA) surface area in 2007

In 2007, 876,623Ha of PA were created that is, an increase by 28.4% compared to 2006. The temporary status was attributed to 850,588Ha while 26,035Ha received the final status. When the PA creation achievements are cumulated, it appears that the objectives set for 2012 in PA creation are achieved at 77%. Awareness-raising was conducted in 271 Fokontanys and communal consultations were performed in 12 sites.

Regarding delineation, development schemes, and management modes, 07 PAs have been delineated and 07 Development and Management Schemes developed in 06 Regions, namely: Atsimo Andrefana, Menabe, Vakinankaratra, Diana, Alaotra Mangoro, and Atsinanana.

The number of tourists who visited the PAs reached 113,875.

As regards ecological monitoring and the enforcement of measures for the conservation of land and water ecosystems, the PAs’ overall index of effectiveness reached 59% for an objective set at 63%.

Increase of the reforested and restored surface area

A surface area of 18,379Ha was reforested, which amounts to 73.5% of the objective set. With the production of 9,642,993 seedlings, objectives were achieved at 80.4%. Several restrictions account for the fact that objectives were not achieved and include the high cost of reforestation and technical problems, among others.

Eighty (80) Land Reserves for Reforestation (LRR) of a surface area of 44,544 have been identified in 16 Communes.

As for the pilot sites for carbon absorption and sequestration, 10Ha of land have been restored.

Objective for the reduction of the burnt surface area almost achieved

The objective set in 2007 is that the burnt surface area will be inferior to 450,000Ha that is, a reduction rate of 34% compared to the 2002 level (680,000Ha). This rate was almost attained in the course of the year with an actual rate of 33%, amounting to 455,816Ha of burnt areas. Control efforts are provided by the Forest Administration in combination with those supplied as part of the bush fires control, including the enforcement of incentive and eradication measures. The highest rate of clearing has always been recorded in Toamasina, of all the Faritanys of Madagascar. It must be noted that the annual amount of burnt areas always increases significantly when elections are held that year.

A hundred (100) Communes were awarded prizes for the prevention of uncontrolled fires.

Funds mobilized for the Protected Areas and Biodiversity Foundation of Madagascar

The amount mobilized for the PABFM reached USD 33,162,586 and is distributed as follows:

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The environmental forest receipts amounted to 200% of the objectives set that is, 3,029 billion Ariary, including 2,367 billion Ariary of entry fees in Protected Areas and 662 million Ariary from the National Forest Fund.

A process is underway to develop 03 instruments for sustainable funding (carbon, green tax, levy on environmental services, and biodiversity offset).

To increase funding from the private sector, the policy of concession of ecotouristic services and lands in National Parks/ANGAP to the private sector is being studied.

Increased implementation of the Environmental Education Policy

As part of the training on environmental education, the environmental curriculum is adopted in:

  • 100% of primary schools;

  • 90% of secondary schools;

  • 25% of technical and vocational schools;

  • 06 Universities.

Trainers are established and pedagogical kits are developed. The activities will be gradually conducted at the Regions’ level.

Reinforced forest control

Regarding policing, control, and the forest regulation frame:

  • 04 control units have been established in 04 Regions and also in large airports;

  • 02 environmental regulation and control tools have been developed;

  • 24 controls have been performed;

  • 27 misdemeanors have been established and more than 20,000 pieces of illegal wood seized.

Contribution of programs and projects

The results of the Environmental Program 3 funded by IDA, CI, USAID, the UE, and UNDP are materialized by the development of “Trust Fund” specific instruments of financial sustainability for the PABFM and the improvement of the institutional device.

The Sustainable Management of Natural Resources Program (RFA), the pilot Project for Protecting and Enhancing the Value of Biodiversity (AFD), and the Study of Rural Development and Catchment Areas Development in Southwestern Alaotra (JICA), all contributed to the sector’s performance.

Efforts must nevertheless be provided regarding the Development of National Actions to Adjust to Climate Change Project (IDA) and the Seeds Harvesting and Conservation Project (Royal Botanic Gardens).

Completion Status of the Major Commitments Taken during the Presidential Dialogue

  • Conciliation of agricultural development and forest conservation through the promotion of consultation and the establishment of consultation structures between the sectors concerned, in the different processes: zoning, management transfer, development and management scheme of catchment areas or wide areas of agricultural production, creation of protected areas with consideration of preservation actions, commune development plans, etc.

  • Trial funding of FATANOL stoves production;

  • Communication packages are developed, networks and media are animated and sensitized (posters, TV programs, website, exhibitions, participation in official celebrations). Pedagogical kits are developed and trainer teachers are trained. Vintsy magazines are disseminated and clubs are set up in schools;

  • Environmental cells are established and reinforced for the environmental integration in 11 sectors;

  • Joint design of the CIREEFs’ AWPs with the Regions, with technical and financial supervision from donors as well as involvement, according their zones of intervention;

  • Management of environmental dashboards (TBE) at the national and regional levels;

  • Establishment of the Regional Directorates of Environment, Water and Forest, and Tourism (RDEWFT) in the 22 Regions.

Challenges and Outlooks

  • Ensure the fluidity of information between decentralized services;

  • Reinforce linkages with the Regions: technical supervision, communication of information;

  • Equip the 22 Regions with their own regional control service.


  • Involve all interveners, sectoral Ministries, decentralized territorial collectivities, the forces of law and order, and the local population, so that control efforts may be combined at all levels;

  • As for ANGAP, one site should have just one donor;

  • Each Protected Area should have a fire management plan including preventive as well as active control.

Commitment 8: National Solidarity

The objective of Commitment 8 is to conjure up a national identity and to honor and preserve our heritage and cultural traditions. The citizens’ participation in all aspects of the social, cultural, and political lives will be promoted to contribute to the country’s development.

Analysis of the quantum leap

  • The democratization process is doing well in Madagascar, resulting for instance, in the multiplicity of political parties and the proliferation of media (radio, television, newspaper, etc., which are mostly private).

  • The elections, to which several candidates from political parties or not presented themselves, were judged as free and open.

  • Conclusive sustained results supported by national awareness were obtained in birth registration.

  • Concrete results were obtained regarding the preservation of cultural heritage.

  • The preparation of athletes to international competitions was improved owing to the support provided to the practice of high level sports.

Analysis of priority indicators

Mechanisms of citizen participation are developed but little in Madagascar. For the moment, elections seem to be the most determining factor in the Malagasy setting, compared to other channels, such as media and civil society organizations. The main issues of citizen participation are: i) difficulties of access to information; ii) lack of organization of the civil society, iii) poor participation of women; iv) perfectibility of the electoral process; v) poorness of local governance.

Mitigated results regarding the national rate of participation to elections

The Afrobarometer survey 2005 (source: Integrity National Observatory #°3 of July-August 2006) indicated an important participation rate to the 2002 legislative elections, with 77% of Malagasy people reporting participation to these elections. In 2007, the national rate of participation to the three elections organized are mitigated, as shown on the following table and compared to the objective set of 60%.

Several factors account for the level of the population’s participation described in the previous table:

  • the development of electoral registers by organizers;

  • awareness-raising of electors on participation;

  • the organization of civil societies, which can provide linkages between citizens and the party in power;

  • the high level of illiteracy;

  • the electoral college’s lack of political maturity.

Decrease of the percentage of youth and children having no birth certificate

Although accurate figures are not available, experience shows that many children are not registered at birth. In such cases, they are deprived from their most elementary rights.

In 2007, the proportion of children and youth under 18 that had no birth certificate amounted to 31.2% while the objective was set at 33.2%.

In spite of the situation, there is community dynamism and strong collaboration between decentralized services; the populations of the different localities organize themselves with court services and proximity authorities, including municipal services, to hold open hearings with parental participation and local funding.

However, there are still issues such as the unavailability of magistrates for the open hearings due to their responsibilities and lack of knowledge of the newly appointed the Heads of Fokontanys on procedures. It is also clear that funds are lacking.

UNICEF contributes to the National Program of Rehabilitation of Birth Registration or Ezaka Kopia ho an’ny Ankizy (EKA) Program.

Number of national cultural heritages (physical or non physical) preserved

In 2007, seven cultural heritages underwent rehabilitation and restoration works instead of three, as planned. Caution must nevertheless be taken in interpreting the results, as most works are just being started.

Problems encountered include emergencies relating to the unexpected changes of the sites’ conservation state that often appear during the work. The lack of standardized infrastructures and potential donors intervening in the sector are also serious impediments to cultural development.

The main programs and projects that contributed to the achievements are:

  • UNESCO: technical and financial support;

  • Support of the Coopération Française to ART MADA;

  • Support of the United States of America to the preservation and promotion of traditional dance and music.

Number of athletes participating in international competitions

Year 2007 was marked by the selection of 393 athletes for competitions such as the 7th Indian Ocean Island Games. Although this figure amounts only to 79% of the objective set, the high number of medals obtained has shown the quality and high level of the selected sportspeople, and national pride was reinforced.

The 3P collaboration in this area had great importance, as it widely contributed to the achievement of the results. However, the lack of proximity sports infrastructures is still a major impediment to the development of sports for all.

Main contribution of programs and projects

  • Technical and financial support to sports activities and youth initiatives by the Support Program to Sport and Youth Initiatives (SPSYI);

  • Technical and financial support of athletes by the CONFEJES in training and participation to great games;

  • Fight against the propagation of HIV/AIDS among young sportspeople aged 12 to 18 in Madagascar, by the Project Increased use of health services and products, component of SantéNet funded by USAID.

Promotion of gender equality and women’s autonomy

Malagasy women are beginning to hold decision-making positions, although they are still represented in lesser number in the society’s activity sectors: in 2007, the proportion of women in the National Assembly amounted to 7.9%; 10% in the Senate; 15.8% in the Government; 13.6% at the Regions’ level (as Head of the Region), and 4.2% at the Communes’ level (as Mayors).

Several actions were undertaken to take up the challenge set:

  • Reinforcement of the structures in charge of promoting the participation, promotion, and protection of women through the establishment of a national observatory in charge of gender-related changes in partnership with the Sehatra Ivohizana Mira Lenta NGO (SIMIRALENTA); Promotion of women’s participation in economic and civic affairs through the establishment of a female leaders’ network in every Region;

  • Training of 3,250 women from the 22 Regions on leadership, upon the President’s initiative;

  • Training of focal points on advocacy, in partnership with CARE and SAHA;

  • Establishment of 6 listening and legal counselling centers to support women in distress;

  • Training of 200 women on political matters in partnership with Norway as part of Promoting Credible Elections and Democratic Governance in Africa.

Completion Status of the Major Commitments taken during the Presidential Dialogue

Immediate actions:
  • As part of promoting citizen participation, the civil society is currently undertaking several education and awareness-raising actions.

  • Adoption and issuing of Law 2007-040 of 14-01-08, to facilitate the obtaining of birth certificates. This Law confers the competency of open hearings to the Head of District and his/her Deputy;

  • Awareness-raising of parents on declaring births;

  • Promotion of the participation of head of fokontanys in birth declaration;

  • Validation of the National Sports Policy, which awaits the parliamentary session;

  • Enhancement of the value of the Malagasy language and cultural identity: text proposal for the Linguistic Policy in the process of finalization;

  • Celebration of the Vezo culture in Toliara and the “Jerijery” event in Vavatenina as part of laying emphasis on the Malagasy ways and customs;

  • Education and awareness-raising of the population on ways and customs;

  • Mobilization of all sectors on the gender approach: a gender cell is created and made operational at the level of each Ministerial Department in partnership with FNUAP;

  • Dissemination of knowledge on laws pertaining to women and women’s rights: laws and texts are already gathered, the translation of the CEDAW Convention is finalized; the dissemination, planned for 2008 is awaiting funding;

  • National awareness-raising on gender: awareness-raising on women’s rights and on gender during thematic days such as on Women’s day on March 08, Rural Women’s day, Population’s day, Violence Control day, or open day on tourism;

  • Awareness-raising of the population on changing and adopting ways and customs, based on the strong points provided for in the MAP: raise awareness and advocate with traditional leaders in Southwestern Madagascar;

  • Training of 307 animators on the gender approach, for parental education.

Ongoing actions:
  • Coordination between the MENRS and the MSCL to prevent dual systems of school sports management;

  • Reinforcement, improvement, and increase of the number of cultural centers: laying of the foundations of the future House of Culture in Fénérive Est.

Challenges and outlooks

  • Integrate the cultural aspirations and trends of the various local communities concerned in the social and economic development;

  • Perform the inventory, collection, analysis, and dissemination of information on the Malagasy culture and values, to optimize their management and exploitation for development;

  • Professionalize cultural actors and operators;

  • Develop and build the capacities of Decentralized Territorial Collectivities in registering births;

  • Ensure the availability of sports infrastructures at the local, regional, and national levels;

  • Develop a sports for all program to maximize participation in sports activities;

  • Develop an insurance scheme for all participants in sports programs;

  • Conduct advocacy with technical and financial partners for investments in the sports and youth area.

  • Popularize the national and international texts on women’s rights in the Project’s intervention sites.


  • Expand EKA activities to other Communes already defined in the action plan 2008.

  • Increase the budget of the EKA program, especially in RPI and mobilize other donors, because UNICEF is currently the only donor.

  • Research financial partners and potential investors for the development of the cultural sector.

  • Incite decentralized collectivities to integrate the youth and sports component (especially the building of sports infrastructures) in their development program;

  • Mobilize resources for the training of sportspeople to improve performances.


Overall Situation of Financings/Disbursements

To implement the MAP, public resources, internal as well as external, must be strongly mobilized and used in an optimal way. In 2007, the first implementation year, the budget execution showed that the 65.3% of the total resources came from internal resources (i.e. MGA1,693 billions) and 34.7% form external resources (i.e. MGA901 billion).

1.1. External fundings

Table 5 shows that in 2007, tax revenues representing 52% of the total public resources constituted the most important part of the Government’s resources in implementing the MAP. Efforts were made to mobilize internal resources. Thus, the tax revenues amounted MGA1, 493 billion with a fiscal pressure rate of 10.9%. External resources, namely external grants and funding, represented 44% of total resources.

Table 5:

Variation of the national rates of participation to 2007 elections

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Source: National Board of Elections

As regards the allocation of the resources, 20% of the internal resources (i.e. MGA327 billion) were mobilized to fund investment expenditures that amounted MGA1, 298 billion and represented 45% of the total resources. The rest was allocated to personnel expenditures (23.8%), to operating expenses (16.5%) and to other expenditures (14%).

Table 6:

Public resources and their allocations

(in billion ariary)

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Source: MFB/DGB

During budget year 2007, a big share of public expenditures (46% of the total budget, all categories taken together) was allocated to the social sector, namely education, infrastructures, and health. Their respective share in the budget was of 22.7% for education, 8.3% for infrastructures, and 8.8% for health.

Table 7:

Operating and investment expenditures in the priority sectors

(in billion ariary)

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Source: MFB/DGB

Generally speaking, the absorption capacity of 65.59% (investment and operation) in 2007 is a low performance (39.02% being investment). The low performance is noted especially in the priority sectors such as Agriculture, Water & Forest, Public Works, Education, and Health and I s due to delays in budget implementation at the Ministries, poor mastery of the software ORACLE, the negative effects of expenditures regulation resulting in slow financial implementation of certain Program/projects, or even the lack of financial incentives.

1.2. External funding

Table 8:

Situation of external funding disbursement, by donor

(in billion ariary)

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Source: MFB/DGB

The total amount of disbursements on external funding in 2007 was MGA859.5 billion, distributed as follows:

  • Multilateral funding: MGA655 billion

  • Bilateral funding: MGA203.3 billion

Table 9:

Use of external resources by sector and sub-sector

(Amounts disbursed in 2006-2007) (in billion ariary)

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Source: MFB/DGB

Table 8 shows that the external resources were allocated based on the MAP’s priorities, which reflects donors’ commitment to support the government’s effort to achieve the MAP’s ambitious objectives. Indeed, in 2007, a big share of the resources allocated by donors (MGA395.6 billion, i.e. 46%) was allocated to the funding of infrastructures, including the transport sub-sector that benefited from MGA310.2 billion. The respective shares of the social and productive sectors were of MGA237.2 billion (27.5%) and MGA144.4 billion (16.8%). The remaining MGA82.3 billion were allocated to the administrative sector.

1.3. Contribution of Foreign Trade

In order to own international mechanisms and systems to develop foreign trade, Madagascar has developed its relations at the regional level through the IOC, the COMESA, the SADC, the African Growth Opportunity Act (AGOA), The Association of Countries Riparian to the Indian Ocean, and the African Caribbean and Pacific (ACP) countries under the Cotonou agreement. At the global level, the country has accessed the World Trade Organization (WTO).

Madagascar’s exports increased by 13.7% from 2006 to 2007, compared to 9.0% from 2005 to 2006. However, it must be noted that the situation results more from an expanded market for existing products than an expansion of outlets for non traditional products. It reflects the benefits of developing regional cooperation: indeed, Madagascar took profit of its comparative advantages related to its geographical proximity with certain countries members of regional organizations (SADC, COMESA). Over three years, Madagascar’s exports towards nearby countries such as South Africa and Mauritius have made up 34% of the total foreign trade on average.

However, imports also increased by 29.3% between 2006 and 2007, compared to 1% between 2005 and 2006. Imports of energy, equipment goods, and raw materials accounted respectively 18.6%, 12.6% and 15.3% of the total imports. The increase in the imports of equipment goods was exceptionally high in 2007 due to the investments in the mining sectors.

A refocusing of the trade policy is planned, taking into account the standard and quality aspects, in order to better face competition.

In addition, the balance trade has kept on deteriorating, from -1.0% in 2006 to -2.4% in 2007.

The deficit of the external current account was funded by the flow of external aid in various forms – direct budget aid, aid through project, debt cancellation as part of the Initiative for Multilateral Debt Relief, which allowed for reconstituting foreign currency reserve at a level of 2.9 months of goods and services imports in December 2007.

1.4. Contribution of Foreign Direct Investments (FDIs)

The investment efforts in the private sector have strongly contributed to achieving the growth rates observed in the different sectors over the last two years. Foreign investments have been of special importance in sustaining economic growth. Indeed, the amount of FDIs increased from 58.0 million SDR in 2005 to 150.5 million SDR in 2006 and 652.1 million SDR in 2007 (forecast), according to the 2006-2007 Economic and Financial Report of the MECI. The target sectors include the extractive activities followed by financial activities, oil distribution, and telecommunication.

As regards actions to promote Madagascar, they included participation in international fairs, and the development of bilateral agreements to promote and protect investments.



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