Madagascar Economy - 2005

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 has 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 - $14.56 billion (2004 est.)

GDP - real growth rate:
5.5% (2004 est.)

GDP - per capita:
purchasing power parity - $800 (2004 est.)

GDP - composition by sector:
agriculture: 29.3%
industry: 16.7%
services: 54% (2004 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:
38.1 (1999)

Inflation rate (consumer prices):
7.5% (2004 est.)

Investment (gross fixed):
14.7% of GDP (2004 est.)

Budget:
revenues: $783.7 million
expenditures: $1.079 billion, including capital expenditures of $331 million (2004 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:
840.2 million kWh (2002)

Electricity - consumption:
781.4 million kWh (2002)

Electricity - exports:
0 kWh (2002)

Electricity - imports:
0 kWh (2002)

Oil - production:
0 bbl/day (2001 est.)

Oil - consumption:
13,000 bbl/day (2001 est.)

Oil - exports:
NA

Oil - imports:
NA

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

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

Current account balance:
$-281.9 million (2004 est.)

Exports:
$868.2 million f.o.b. (2004 est.)

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

Exports - partners:
US 35.7%, France 30.7%, Germany 7.1%, Mauritius 4.4% (2004)

Imports:
$1.147 billion f.o.b. (2004 est.)

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

Imports - partners:
France 17.6%, China 11.1%, Hong Kong 6.7%, Iran 6.2%, South Africa 5.8% (2004)

Reserves of foreign exchange and gold:
$500.3 million (2004 est.)

Debt - external:
$4.6 billion (2002)

Economic aid - recipient:
$354 million (2001)

Currency (code):
Madagascar ariary (MGA)

Exchange rates:
Malagasy francs per US dollar - 1,868.9 (2004), 1,238.3 (2003), 1,366.4 (2002), 1,317.7 (2001), 1,353.5 (2000)