Madagascar Economy - 2006

Economy - overview:
Having discarded past socialist economic policies, Madagascar has since the mid 1990s followed a World Bank- and IMF-led policy of privatization and liberalization. This strategy placed the country on a slow and steady growth path from an extremely low level. Agriculture, including fishing and forestry, is a mainstay of the economy, accounting for more than one-fourth of GDP and employing 80% of the population. Exports of apparel have boomed in recent years primarily due to duty-free access to the United States. Deforestation and erosion, aggravated by the use of firewood as the primary source of fuel, are serious concerns. President RAVALOMANANA has worked aggressively to revive the economy following the 2002 political crisis, which triggered a 12% drop in GDP that year. Poverty reduction and combating corruption will be the centerpieces of economic policy for the next few years.

GDP (purchasing power parity):
$15.85 billion (2005 est.)

GDP (official exchange rate):
$4.569 billion (2005 est.)

GDP - real growth rate:
6% (2005 est.)

GDP - per capita (PPP):
$900 (2005 est.)

GDP - composition by sector:
agriculture: 28.7%
industry: 16.5%
services: 54.8% (2005 est.)

Labor force:
7.3 million (2000)

Population below poverty line:
50% (2004 est.)

Household income or consumption by percentage share:
lowest 10%: 3%
highest 10%: 29% (1999)

Distribution of family income - Gini index:
47.5 (2001)

Inflation rate (consumer prices):
10% (2005 est.)

Investment (gross fixed):
26.8% of GDP (2005 est.)

Budget:
revenues: $703.6 million
expenditures: $853 million; including capital expenditures of $331 million (2005 est.)

Agriculture - products:
coffee, vanilla, sugarcane, cloves, cocoa, rice, cassava (tapioca), beans, bananas, peanuts; livestock products

Industries:
meat processing, soap, breweries, tanneries, sugar, textiles, glassware, cement, automobile assembly plant, paper, petroleum, tourism

Industrial production growth rate:
3% (2000 est.)

Electricity - production:
825.4 million kWh (2003)

Electricity - consumption:
767.7 million kWh (2003)

Electricity - exports:
0 kWh (2003)

Electricity - imports:
0 kWh (2003)

Oil - production:
89.27 bbl/day (2003 est.)

Oil - consumption:
15,000 bbl/day (2003 est.)

Oil - exports:
NA bbl/day

Oil - imports:
NA bbl/day

Oil - proved reserves:
0 bbl (1 January 2002)

Natural gas - production:
0 cu m (2003 est.)

Natural gas - consumption:
0 cu m (2003 est.)

Natural gas - proved reserves:
0 cu m (1 January 2002)

Current account balance:
-$292 million (2005 est.)

Exports:
$951 million f.o.b. (2005 est.)

Exports - commodities:
coffee, vanilla, shellfish, sugar, cotton cloth, chromite, petroleum products

Exports - partners:
US 35.8%, France 30.8%, Germany 7.7% (2004)

Imports:
$1.4 billion f.o.b. (2005 est.)

Imports - commodities:
capital goods, petroleum, consumer goods, food

Imports - partners:
France 17.2%, China 9.7%, Hong Kong 6.6%, Iran 6.4%, Mauritius 6.2%, South Africa 5.6% (2004)

Reserves of foreign exchange and gold:
$539 million (2005 est.)

Debt - external:
$4.6 billion (2002)

Economic aid - recipient:
$354 million (2001)

Currency (code):
Madagascar ariary (MGA)

Exchange rates:
Malagasy ariary per US dollar - 2,003 (2005), 1,868.9 (2004), 1,238.3 (2003), 1,366.4 (2002), 1,317.7 (2001)