AfDB approves over US$67 million to Madagascar

The African Development Bank Group (AfDB) has approved a loan facility of $67.3 million to help Madagascar revive its economy.

AfDB’s decision to approve the loan facility will give the island nation the resources for the Financial Management and Resilience Support Programme that runs from 2024 to 2025.

According to the manager of the AfDB country office in Madagascar, Adam Amoumoun, “the programme aims to contribute to the development of favourable conditions for inclusive and strong economic growth by stregthening economic and financial governance, and improving economic resilience.”

Also, the programme supports the implementation of reforms captured in the New Energy Policy and Madagascar’s General State Policy.

It will help remedy the investment deficit by increasing the budget and releasing additional resources for economic recovery while improving governance in the energy sector,” Amoumoun further explained.

In addition, the Financial Management and Resilience Support Programme supports the country’s transition to the new Integrated Tax Administration System (SAFI), in a move aimed at modernizing tax management, computerizing tax operations, improving revenue collection, and combating fraud.

The program will also facilitate the development of a national register of owners of legal structures and entities. The government intends to use the register to identify business owners and facilitate the detection of corruption.

In terms of improving governance in the country’s energy sector, the program aims to support the provision of electricity and water services across the country. The support ensures that the JIRAMA, the country’s corporation for water and electricity services, operates with minimal state support.

The AfDB’s country report 2024 projects Madagascar will experience 4.5% economic growth in 2024 and 5.3% in 2024. In recent years, the country has experienced climate change-induced droughts that increase water stress.