Madagascar, an island state in southern Africa located in the Indian Ocean east of Mozambique, is the fifth largest island in the world, with a land mass of 587,000 km2 and 25.5 million inhabitants in 2017. Despite its abundant natural resources, it is one of the poorest countries in the world.
The presidential elections were held peacefully in January 2019, and marked the first political alternation of power in Madagascar. President Rajoelina won the elections with 55.6% of the vote and an election manifesto promising to scale up growth and radically reduce poverty. Prime Minister Christian Ntsay was reappointed to the head of government with a cabinet of 22 ministers. Some ministries were merged to improve public administration efficiency. The Malagasy Government is preparing its new 2019-2023 Emergency Plan based on the 13 commitments made by the president. The legislative elections are scheduled for May 27, 2019.
The economy remained upbeat with growth estimated at 5.2% in 2018, a level comparable with the last five years. Private sector buoyancy, particularly flourishing service sector growth, was underpinned by positive macroeconomic conditions including a drop in inflation from 8.3% in 2017 to 7.3% in 2018, a relatively stable real effective exchange rate, and a fiscal deficit under control. The financial, logistics, and real property development sectors also posted growth. Good weather conditions brought an upturn in agricultural production in 2018.
However, these positive economic results barely touched the poverty rate, which inched back from 77.7% in 2014 to 75.1% in 2018. Agriculture, as the country’s leading employer and livelihood of 80% of the population, plays a key role in progress with poverty in Madagascar. Yet agricultural growth has been too low and volatile in recent years, generally trending at less than demographic growth.
The economy is forecast to stay on its growth course in the coming years, driven by the increase in public and private sector investments, including by public-private partnerships (PPPs). Growth in exports is projected to remain high owing to strong global demand for nickel and vanilla.
Madagascar is among the poorest countries in the world with 75% of the population living on less than $1.90 per day. The country’s human capital index is also one of the lowest worldwide and it has the world’s fourth highest rate of chronic malnutrition, with one child in two under five years suffering from stunting. An estimated 1.4 million children dropped out of primary school in 2012, the fifth highest number in the world.
Living conditions remain difficult for the vast majority of the population. The rate of access to electricity is just 13%, one of the lowest in the world, and the country is also one of the hardest hit by extreme weather events in Africa, with an average of three cyclones per year.
Last Updated: Jun 06, 2019