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MADAGASCAR
>> Regional Overview >> Madagascar Overview
Development Challenge FY2001 Program /
Activity & Budget InformationSummary Tables
Program Summary
Previous Years' Activities
2000, 1999, 1998, 199709
Introduction
The principal U.S. interest in Madagascar lies in the high potential of its people to break out of poverty to become one of Africa's emerging market economies, thus enhancing its ability to manage its globally unique biodiversity. Assistance to Madagascar serves U.S. interests by helping establish a legal and policy environment that encourages private initiative and investment, fosters greater respect for human rights and the rule of law, and increases decentralized responsibility for decision making. Assistance to Madagascar also advances U.S. interests by helping the Malagasy people to manage effectively one of the earth's most extraordinary sources of biodiversity. Additionally, U.S. assistance is slowing the spread of the AIDS virus while helping Malagasy families to become smaller and healthier. All of these factors contribute to integrating Madagascar into the world economy and in turn building its capacity to assume a greater partnership role in support of United States interests.
The Development Challenge
According to the World Bank, approximately 70% of Madagascar's population lives in absolute poverty. The nation's decline was mainly due to a twenty-year failed socialist economic and regulatory policy that discouraged private sector investment and growth. Madagascar also suffered from high population growth rates, intensive deforestation and soil erosion, declines in soil fertility, declines in health status (particularly among children), and political and social turmoil. Despite this bleak picture, there is a general agreement in the donor community that the country is now more positively positioned for future growth. Following Madagascar's successful transition to democracy in the early 1990s, the government stabilized the economy and negotiated an ambitious Structural Adjustment Program (SAP) with the World Bank and the International Monetary Fund (IMF) in 1996 to reverse its economic decline, launch sustained growth, and reduce poverty. U.S. leadership is credited with having brought the international financial institutions, donors, and the Government of Madagascar (GOM) together on completion of this key step. In 1999, the World Bank approved a second Structural Adjustment Credit (SAC II) totaling $100 million (to be disbursed in three tranches) and the IMF approved a second annual arrangement and extension of the commitment period under its Enhanced Structural Adjustment Facility (ESAF). Madagascar's debt service ratio, which had reached 46% in 1996, is now estimated at 16.5%.
To respond to Madagascar's compelling needs and promote U.S. interests, USAID pursues three objectives which contribute directly to specific goals articulated in the U.S. Embassy's Mission Performance Plan (MPP).
Due to a well-established dialogue with the GOM, there is strong Malagasy ownership of, and support for, the USAID program and its goals. This is reflected in the results that USAID is helping to achieve. All objectives are on track toward achievement of the results expected by the end of the current strategic planning period in FY 2003, and none have encountered serious technical or policy obstacles that would call into question their ability to achieve those results within the agreed timeframe.
The establishment of a legal, policy, and institutional environment that promotes private initiative and thereby contributes to sustainable economic development is key to reducing poverty in Madagascar. With USAID's support, business codes are being revised and judicial reform is underway to protect and promote economic participants' right to invest and employ their resources productively. USAID provides a critical contribution to expand the access of the poor to sustainable micro-finance services and to the implementation of supportive financial policies. Working with civil society, USAID also supports greater public participation in economic and legal issues, accountability, and the rule of law. In addition, USAID is helping to improve Madagascar's trade and investment regime and its effective integration into the global economy. Major accomplishments during the past year included the formation of four regional committees devoted to promoting the development and use of arbitration and mediation; the compilation and distribution of four commercial codes that will provide legal actors throughout the nation with greater access to the law of the land; an increased awareness of the adverse impact of corruption and of means to combat it; the continuation of reforms aimed at strengthening the credibility of the justice sector; further expansion of open and informed communication between citizens and their local governments; and the continued strengthening of analytical capacity and increased use of economic policy analyses in public decision-making.
Conserving Madagascar's environment is one of the GOM's highest priorities. With USAID's assistance, Madagascar is finding ways to meet the resource needs of an expanding population without compromising its unique biodiversity. USAID continues to be a major contributor to the 15-year Malagasy Environmental Action Plan. The second phase of U.S. support for this action plan (EP2) began in 1997 with a focus on decentralization. USAID's support reinforces Madagascar's commitment to biodiversity conservation by shifting natural resource management responsibility to Malagasy institutions, expanding local community participation, and increasing ecotourism and private sector involvement in conservation enterprises within biodiversity-rich ecological regions. Major successes in 1999 included the incorporation of environmental concerns into regional planning processes, empowerment of local communities to participate in decision-making for the management of natural resources; improvement and expansion of the National Parks system; and increased involvement of the private sector in sustainable natural resource use. In response to one of the largest locust invasions in the country's history, USAID lobbied vigorously for the introduction of environmental monitoring into Madagascar's locust control efforts. As a result, while the locust plague was brought under control, Malagasy institutions safeguarded human health and biodiversity in protected areas and watersheds that would otherwise have been imperiled by unchecked pesticide use.
Madagascar's high rate of population growth is a major contributor to the country's low standard of living as its population growth outstrips economic growth. To provide information to improve the use of scarce resources in the health sector, USAID supports the improvement of health, nutrition and demographic data. USAID is the main donor for polio eradication and supports the enhancement of the country's overall immunization program. USAID is also helping to define policies for effective nutrition programs, while encouraging communities and families to play an active role in disease recognition and prevention. In the family planning and HIV/AIDS sectors, the highly successful family planning and condom promotion program is complemented by AIDS prevention activities targeted at high-risk populations. Major accomplishments in 1999 included the wide dissemination of the 1997 Demographic and Health Survey (DHS) to policy makers and the international scientific community; a significant increase in the distribution of condoms; and the beginning of on-the-ground AIDS prevention efforts by two international private voluntary organizations.
USAID laid a strong foundation for the alleviation of food insecurity. P.L. 480 Title II funding has strengthened the transition from clinic to integrated and community-based food distribution, and proceeds from food monetization are funding local direct activities to improve the food security of Madagascar's most vulnerable citizens. USAID also began to work in collaboration with other donors to enhance the capacity of the National Disaster Committee through the development of a vulnerability assessment that will identify those areas of Madagascar where the most vulnerable populations reside and highlight ways to mitigate that vulnerability.
USAID also continues to play a catalytic role in bringing the benefits of the internet to this once-isolated island nation. With funding from the Leland Initiative, direct internet connectivity has now been extended beyond the capital to two of Madagascar's most important secondary cities, the port of Toamasina and the industrial center of Antsirabe. These successes, and Madagascar's demonstrated commitment to continuing to expand internet access, have attracted additional resources from the President's Education for Democracy and Development Initiative. In FY 2000, USAID is using these resources to make Madagascar's Ministry of Technical Education one of ten African education ministries to be connected to the internet. USAID will use FY 2001 resources to connect Malagasy civil society, universities, and other partner organizations to the internet and to help develop networks between groups that share common interests and objectives.
Other Donors
Transportation and communications, health and education, environment, and agriculture remain the priority investment areas for donor support. Donor unity on disaster relief, structural reform, carefully designed programs, and a focus on strengthening civil society is well-established. Ranking fourth among donors, the United States provided $20.8 million in FY 1999. France, the lead donor, provided $116 million, followed by the World Bank's International Development Association ($73.1 million), the European Union ($22.3 million), and Japan ($14.1 million).
Country Background Information Resources CIA Factbook
Library of CongressNational Geographic Country Maps
State Dept. Country Information
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Last Updated on: November 09, 2000 |
