An International Monetary Fund (IMF) team, led by Constant Lonkeng, engaged in discussions with Malagasy authorities from April 2 to 14, 2025, in Antananarivo. The talks centered on the Second Reviews of Madagascar's economic program under the Extended Credit Facility (ECF) and the Resilience and Sustainability Facility (RSF).
Following the mission, Mr. Lonkeng declared the achievement of a staff-level agreement on policies essential for completing the reviews. He indicated that upon certain actions being completed and garnering the IMF Executive Board's approval, Madagascar could receive disbursements under the ECF and RSF arrangements. These amounts are SDR 36.66 million (approximately $51 million) and SDR 40.73 million (approximately $57 million) respectively.
Performance in Madagascar has shown gradual improvement, achieving all but one of the quantitative targets set for the end of December 2024. The fiscal deficit was contained through spending restraint, while tax collection aligned with expectations, with this trend continuing into 2025. Authorities reiterated their dedication to domestic revenue mobilization and expenditure prioritization, achieving initial progress in areas such as public financial management and disaster risk management.
Amid global uncertainty, contingency planning remains crucial, according to Mr. Lonkeng. He emphasized the central bank’s role in monitoring second-round effects from recent shocks and the necessity to adjust policy rates to control inflation.
The mission reviewed developments regarding JIRAMA’s recovery plan. Rapid adoption and execution of this plan could enhance electricity and water supply, contributing to reduced production costs. Continuation of the automatic fuel pricing mechanism is advised to address Madagascar’s development challenges. The rollout of solar kits in rural areas, alongside compensatory measures, is anticipated to buffer the effects of kerosene price increases on the vulnerable population.
Attention was also given to the launch of a national anticorruption strategy, urging swift implementation for accountability. Enhancing transparency in public finance and the projection of national resources could affirm the value received for expenditures, addressing the decline in official development assistance. The creation of a homegrown action plan for the IMF’s governance diagnostic recommendations is expected to bolster governance and the rule of law.
The IMF team met with President Andry Rajoelina, Prime Minister Christian Ntsay, several ministers, and other key stakeholders, including members of civil society, the donor community, and the private sector. The team extended thanks to the Malagasy authorities and various stakeholders for their cooperation throughout the mission.