Madagascar eyes economic reforms with $14 million grant from AfDB
30-11-2017 13:14:08 | by: Bob Koigi | hits: 3147 | Tags:

The Board of Directors of the African Development Bank Group (AfDB) has approved a $ 14 million grant and a partial credit guarantee from the African Development Bank (AfDB) Facility. Transition Support (TAF) of US $ 31 million to finance the first phase of the Economic Competitiveness Support Program (PACE I) in Madagascar.

PACE, which is a three-year program budget support (2017-2019), also aims at consolidating the results achieved in previous Bank operations in the country: economic governance, energy sector reform 2016, but also the creation of favorable conditions for strong and inclusive economic growth in Madagascar.

The reforms also aim to support the government's efforts in implementing the 2015-2019 National Development Plan (NDP) .

In the implementation of this project, the focus will be on improving Madagascar's competitiveness in order to attract more private and public investment in job-creating sectors such as agro-industry and the improvement of the performance of state-owned companies:

Madagascar's National Electricity and Water Company (JIRAMA) and Air Madagascar, allowing the State to reduce the subsidies and transfers it grants them. The resources thus saved could be redirected towards investments in public infrastructure and social sectors generating inclusive and sustainable economic growth.

The Republic of Madagascar combines two financing instruments, namely budget support and Partial Credit Guarantee (GPC), to support its structural reforms. Once implemented, the US $ 31 million GPC will enable the country to raise US $ 50 million in the international banking market.