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Economic & Sector Work :: Country Economic Memorandum

Madagascar : Back to the Future on the Road to Sustained and Balanced Growth, Country Economic Memorandum, Volume 1, Main Report

ABSENTEEISM ACCESS TO CREDIT ACCESSIBILITY ACCOUNTABILITY ACCOUNTING ADVERSE SELECTION AGRICULTURAL OUTPUT AGRICULTURE AIR AIR CARGO AIRPORTS AVERAGE GROWTH AVERAGE PRODUCTIVITY BANK LENDING BANKING REFORM BANKING SECTOR BANKING SYSTEM BANKS BENCHMARK BOTTLENECKS BUDGETARY PROCESSES CAPITAL GOODS CAPITAL GROWTH CAPITAL INVESTMENT CAPITAL SUBSIDIES COMMODITIES COMMODITY COMPARATIVE ADVANTAGE COMPETITIVENESS CONGESTION CONSOLIDATION CONSUMER CONTRACT ENFORCEMENT CONTRIBUTIONS CURRENT ACCOUNT CURRENT ACCOUNT DEFICIT DECISION MAKING DEPOSIT DEPOSITS DEPRECIATION DEVELOPMENT AGENCIES DEVELOPMENT ASSISTANCE DIMINISHING RETURNS DIRECT INVESTMENT DISPOSABLE INCOMES DIVERSIFICATION DOMESTIC GOODS DRIVING DROUGHT DROUGHTS EARNINGS ECONOMIC GROWTH ECONOMIC MANAGEMENT ECONOMIC REFORM EMPLOYMENT ENVIRONMENTAL DEGRADATION EQUIPMENT EXCHANGE RATE EXPENDITURE EXPORT COMPETITIVENESS EXPORTERS EXPORTS EXTENSION SERVICES EXTERNAL SHOCKS EXTERNAL TRANSPORT EXTERNALITIES FAIR TRADING FARES FARM INCOMES FINANCIAL INTERMEDIATION FINANCIAL SECTOR FINANCIAL SECTORS FINANCIAL STABILITY FINANCIAL SUPPORT FISCAL SUSTAINABILITY FOREIGN DIRECT INVESTMENT FREIGHT FREIGHT COSTS FUEL FUEL COSTS FUEL PRICES FUTURE GROWTH GROSS FIXED CAPITAL FORMATION GROWTH POTENTIAL GROWTH THEORIES HEALTH SERVICES HIGH ENERGY HIGH TRANSPORT HOUSING HUMAN CAPITAL HUMAN RESOURCE IMPORT COSTS INCOME GROWTH INDIRECT COSTS INEFFICIENCY INFLATION INFRASTRUCTURE INVESTMENT INFRASTRUCTURE INVESTMENTS INFRASTRUCTURE PROJECTS INSPECTION INSURANCE INTEREST RATE INTEREST RATE SPREADS INTEREST RATES INTERNATIONAL FREIGHT TRANSPORT INVESTING INVESTMENT CLIMATE INVESTMENT CLIMATE ASSESSMENT INVESTMENT FINANCING INVESTMENT RATES INVESTMENT REQUIREMENTS INVESTMENT RETURNS JOURNEY LABOR FORCE LABOR MARKET LABOR MARKETS LAND TRANSPORT LARGE FIRMS LEVEL PLAYING FIELD LOWER INCOMES MARKET ANALYSIS MARKET CONDITIONS MARKET DEMAND MARKET DEMANDS MARKET FAILURES MARKETING MIGRATION MONOPOLY NATIONAL INCOME NATURAL RESOURCES OPPORTUNITY COSTS OVERHEAD COSTS PEDESTRIAN PENSION PENSION REFORM PER CAPITA INCOME PER CAPITA INCOMES POLITICAL STABILITY POPULATION DENSITY POPULATION GROWTH PRICE VOLATILITY PRIMARY EDUCATION PRIVATE CAPITAL PRIVATE INVESTMENT PRIVATE INVESTMENTS PRIVATE SECTOR PRODUCTIVITY PRIVATIZATION PRODUCT MARKETS PRODUCTIVITY PRODUCTIVITY GROWTH PROFITABILITY PROPERTY RIGHTS PROSPERITY PUBLIC GOODS PUBLIC INVESTMENT PUBLIC INVESTMENTS PUBLIC OWNERSHIP PUBLIC POLICIES PUBLIC POLICY PUBLIC SERVICE DELIVERY PUBLIC SERVICES PUBLIC WORKS RAIL RAIL LINK RAIL SERVICES RAIL TRANSPORTATION RAILROAD RAILWAY RAILWAY NETWORK RAILWAYS RAPID DEMOGRAPHIC TRANSITION RAPID GROWTH RAPID POPULATION GROWTH REAL GDP REGULATORY FRAMEWORK REMITTANCES RENT SEEKING RESETTLEMENT RESOURCE MANAGEMENT RETURN RISK AVERSION RISK MANAGEMENT ROAD ROAD NETWORK ROAD TRANSPORT ROADS RURAL FINANCE RURAL INFRASTRUCTURE RURAL ROADS RURAL TRANSPORT SAFETY SAFETY NET SAFETY NETS SALES SAVINGS SAVINGS RATES SECONDARY EDUCATION SECONDARY SCHOOLS SOCIAL SERVICES SOCIAL WELFARE SOFT LOANS STOCKS TAX TAX EXEMPTIONS TAX INCENTIVES TAX RATES TELECOMMUNICATIONS TOTAL FACTOR PRODUCTIVITY TRADE BALANCE TRADE DEFICIT TRAFFIC TRANSPORT TRANSPORT CORRIDORS TRANSPORT COSTS TRANSPORT FACILITIES TRANSPORT INFRASTRUCTURE TRANSPORT MODES TRANSPORT OPERATORS TRANSPORT SECTOR TRANSPORT SERVICES TRANSPORT SYSTEM TRANSPORTATION TRANSPORTATION SERVICES TRUCKS TRUE TRUST FUNDS UNEMPLOYED URBANIZATION VALUABLE VEHICLE VEHICLE OPERATING VEHICLE OPERATING COSTS WATER SUPPLY WEALTH WITHDRAWAL WORLD MARKETS WORTH
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Washington, DC
Africa | East Africa | Sub-Saharan Africa | Madagascar
2012-06-12T15:22:14Z | 2012-06-12T15:22:14Z | 2008-12

The objective of this study is to accompany Malagasy authorities in their transition towards economic emergence. If the contribution of foreign capital and the abundance of natural resources should help the Malagasy economy escape from the poverty trap by increasing its domestic savings and investment capacities, as well as its technological capacities. International experience reminds us that this transition is far from being automatic. Indeed, there are more examples of countries that have failed than of those who have succeeded. The successes of Chile, Tunisia, Malaysia, Mauritius, and Botswana can inspire the Malagasy policy makers while showing them which economic policy choices become imperative. This study is divided into four parts. The first part begins with an analysis of Madagascar's economic performance, trying to recall its fragility in spite of the good results recorded over these last few years. This fragility will be highlighted through the relatively narrow basis of the economic growth that has greatly relied on foreign capital inflows, putting the need to follow an adequate foreign exchange management policy at the center of the agenda and, thus, minimize its possible negative impact on exports. The second part will focus on the issue of private sector promotion. Recent diagnoses of Madagascar's economy and the strategy adopted by Malagasy authorities (with the support of its development partners) have shown that to be sustained and shared out over time, economic growth will have to rely on a dynamic and competitive private sector. The third part is dedicated to sharing the fruits of economic growth by giving a special emphasis to the distribution of the benefits related to the large mining and tourism investment projects within the population. These large projects represent a unique opportunity for Madagascar's development but also undoubtedly a danger if they do not allow the emergence of spillover effects among the local businesses and labor force. Finally, the fourth and final part proposes an agenda of economic reforms. Ambition is not to formulate a patchy list of proposals, but rather to propose a series of options that will help address the issues of competitiveness and shared growth that are central to the success of the current strategy followed by the Malagasy authorities.

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