IMF Staff Country Reports

This paper presents Republic of Madagascar’s 2024 Article IV Consultation, First Review under the Extended Credit Facility (ECF) Arrangement, Request for a Waiver of Nonobservance of Performance Criteria, and Financing Assurances Review, and First Review under the Arrangement under the Resilience and Sustainability Facility (RSF). After stabilizing at 4.2 percent in 2024, the Malagasy economy is expected to rebound to 4.6 percent in 2025. Inflation is projected to gradually decline in 2025. Madagascar’s performance under the ECF and RSF programs has been adequate albeit uneven. The implementation of an automatic fuel price adjustment mechanism will create fiscal space for social spending and investment. Medium-term growth prospects appear favorable, bolstered by the reforms supported by the RSF and the ECF, including government programs aimed at boosting agricultural productivity, increasing access to electricity, and improving road infrastructure. Further building adaptation and resilience to climate shocks as well as mobilizing climate finance should continue to be a key priority. The new decree on environmental and social impact assessments provides a framework to evaluate and select investment projects, which should be applied to new investments, including road projects.