Population (2019, millions)¹	29.96
Population Projections (2030, millions)¹	35.62
Economically active population in agriculture (as % of Economically active population)12, 2019	80.6
Capital	Antananarivo
Surface Area (km²)²	587,040
Weather¹¹	In Antananarivo: Hottest month, December, 16-27°C; coldest month, July, 9-20°C; driest month, June, 8 mm average rainfall; wettest month, January, 300 mm average rainfall
Languages³	Official: French and Malagasy - Others: English
Main Religions³	Christian, indigenous, and  Muslim
Time⁴	Eastern Africa Time (EAT) +0300 UTC
Driving Orientation⁵	Right Side
Internet Country Code⁶	.mg
Country Calling Code	+261
Plug, Socket and Voltage⁷	Type C, D, E, J, and K - 127V/50Hz and 220V/50Hz
Currency	Malagasy Ariary (MGA) - 1/5 = Iraimbilanja
Exchange Rate (As of 29 January, 2019, per USD)⁸	3 ,456.15
GDP at Market Prices (2018, current, billions of USD)⁹	12.1
GDP Growth (2018, annual %)⁹	5.19
Average GDP Growth (2014-2018, annual %)⁹	4.02
GDP per Capita, PPP (2018, current international $)⁹	1,634
Inflation, Consumer Prices (2018, annual %)⁹	7.29
Average Inflation, Consumer Prices (2014-2018, annual %)⁹	7.14
Total Reserves in Months of Imports (2018)⁹	3.94

Sources:
¹United Nations Population Division, Department of Economic and Social Affairs.
²COMESA Statistics, COMESTAT Data Hub.
³CIA World Factbook.
⁴Time and Date Portal.
⁵Chartsbin Portal, "Worldwide Driving Orientation by Country".
⁶Wikipedia, "List of Internet top-level domains"; and, Internet Assigned Numbers Authority, Root Zone Database.
⁷International Electrotechnical Commission, World Plugs.
⁸Banque Centrale de Madagascar.
⁹World Bank, World Development Indicators 2019.
¹¹Economist Intelligence Unit.
12AFDB Socio Economic Database

Reasons to Invest in Madagascar

• Abundant natural resources such as Gemstones, industrial and decorative stones, oil and rate metals. In addition to 5,000 km of beaches, big and fertile land with favorable climate for any agriculture activities. 
• Low cost of local inputs and labour. 
• Significant public and private investments in infrastructure, such as road, ports, airports, telecommunication, and energy reduce the costs of doing business. 
• Access to regional and international markets such as COMESA, SADC, the Indian Ocean Rim, and COI. 
• Strategically located between Asia and Africa and on major maritime routes, Madagascar gives an advantage to international businesses. 
• Provides world-class facilities for transportation of goods; 
• Attractive business environment including significant public and private investments in infrastructure, no restrictions on capital flows, and rule of law. 

Source: Madagascar Embassy in Japan Online Portal. 

Population Projections (millions)

Population (2019)	29.96
Population Projections (2030)	35.62

Source: United Nations Population Division, Department of Economic and Social Affairs.

Population Residing in Urban Areas (%)

Population Projections (2019)	37.86
Percentage of Population Residing in Urban Areas (2030)	45.24

Source: United Nations Population Division, Department of Economic and Social Affairs.

Youth Literacy Rates (2017, %)

Youth Literacy Rate, Population 15-24 Years, Both Sexes	81.19
Youth Literacy Rate, Population 15-24 Years, Female	80.67
Youth Literacy Rate, Population 15-24 Years, Male	81.71

Source: United Nations Educational, Scientific and Cultural Organization, UNESCO Institute of Statistics.

Unemployment (2018, % of Total Labour Force)

Unemployment, Total	1.65
Unemployment, Female	1.78
Unemployment, Male	1.53

Source: World Bank, World Development Indicators 2019.

Labour Force (2017, % of Ages 15+, Modeled ILO Estimate)

Labour Force Participation Rate, Total	86.41
Labour Force Participation Rate, Female	83.59
Labour Force Participation Rate, Male	89.41
Labour Force, Total (number)	13,464,363

Source: World Bank, World Development Indicators 2019.

GDP

	2014	2015	2016	2017	2018
GDP at Market Prices (current, billions of USD)	10.67	9.74	9.95	11.46	12.1
GDP Growth (annual %)	3.31	3.11	4.17	4.3	5.19

Source: World Bank, World Development Indicators 2019.

Value Added by Sector (% of GDP)

Indicator	2018	2019
Agriculture	30.91	30.81
Manufacturing	16.50	16.35
Industry	22.21	22.03
Services	65.88	66.16
Construction	3.88	3.85
Electricity, gas and water	1.48	1.47
Mining and quarrying	0.35	0.36
Education	2.34	2.34
Finance, real estate and business services	3.23	3.21
Public administration and Defense	6.08	6.08
Health and Social Work	3.00	3.00
Other services	8.87	8.90
Transport, storage and communication	30.35	30.67
Wholesale and retail trade, hotels and restaurants	15.39	15.33

Source: AFDB Socio Economic Database.

Import Partners (Imported Value, thousands, USD)

	2014	2015	2016	2017	2018
World	3,229,993	2,594,082	2,926,565	3,593,146	3,660,812
China	501,251	478,703	624,187	744,783	812,759
United Arab Emirates	580,298	162,048	164,218	281,062	437,020
France	190,766	156,354	189,134	226,697	339,330
India	201,604	156,380	190,579	264,701	250,064
Pakistan	135,180	87,662	99,416	146,068	179,424

Source: International Trade Center COMTRADE Statistics.

Export Partners (Exported Value, thousands, USD)

	2014	2015	2016	2017	2018
World	2,213,656	2,020,801	2,222,632	2,125,071	2,355,824
United States of America	184,533	218,900	287,161	424,845	495,278
France	484,218	378,983	490,481	284,979	305,394
Japan	142,609	107,478	113,119	107,617	202,552
Netherlands	144,321	135,155	96,388	128,401	142,540
China	98,880	136,961	142,133	173,138	137,413

Source: International Trade Center COMTRADE Statistics.

Madagascar’s Top Import Products (USD ‘000)

Chapter	Description	2014	2015	2016	2017	2018
	All products	3,229,993	2,594,082	2,926,565	3,593,146	3,660,812
27	Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes	729,505	446,949	471,490	547,417	675,318
84	Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof	203,349	182,629	202,235	281,578	305,751
10	Cereals	170,161	91,574	97,227	256,375	246,686
87	Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof	175,735	140,123	181,693	287,732	233,160
85	Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles	157,537	164,929	172,367	164,524	190,031

Source: COMSTAT database

Madagascar’s Top Export Products (USD ‘000)

Chapter	Description	2014	2015	2016	2017	2018
	All products	2,213,656	2,020,801	2,222,632	2,125,071	2,355,824
09	Coffee, tea, mate and spices	260,213	348,749	570,291	945,062	1,034,266
75	Nickel and articles thereof	596,320	511,077	394,688	376,030	416,006
81	Other base metals; cermets; articles thereof	86,716	86,465	77,810	169,737	223,028
71	Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and articles thereof; imitation jewellery; coin	27,858	25,693	39,954	111,213	127,348
26	Ores, slag and ash	99,321	71,272	63,368	125,351	106,287

Source: COMSTAT database

FDI Inflows (millions of USD)

Year	2014	2015	2016	2017	2018
FDI Inflows	314	436	451	389	349

Source: United Nations Conference on Trade and Development, World Investment Report 2019

FDI Outflows (millions of USD)

Year	2014	2015	2016	2017	2018
FDI Outflows	(3.8)	1.1	0.1	(0.9)	0.1

Source: United Nations Conference on Trade and Development, World Investment Report 2019

FDI Inward Stock (millions of USD)

Year	2014	2015	2016	2017	2018
FDI Inward Stock	6,277	5,619	5,882	6,472	6,360

Source: United Nations Conference on Trade and Development, World Investment Report 2019

FDI Outward Stock (millions of USD)

Year	2014	2015	2016	2017	2018
FDI Outward Stock	16	17	17	16	16

Source: United Nations Conference on Trade and Development, World Investment Report 2019

FDI Inflows Main Source Countries (in terms of number of projects)

France, India, UK, United States, Canada, Germany, Mauritius, China, Japan, and Kuwait. 

Source: Financial Times, fDi Markets, 2018

FDI Inflows Main Sectors (in terms of number of projects)

Financial Services, Communications, Metals, Business Services, Food & Tobacco, Transportation, Chemicals, Coal, Oil and Natural Gas, Minerals, and Real Estate.

Source: Financial Times, fDi Markets, 2018

FDI Inflows Main Companies (in terms of number of projects)

MicroCred Bank Madagascar, Airtel Madagascar, Symrise, Rio Tinto Group, CMA CGM, Verizon Communications, Forever Living Products International, Bank of India (BOI), Broll Property Group, and Vanco Energy. 

Source: Financial Times, fDi Markets, 2018

Overall Doing Business Ranking

2020	161/190
2019	161/190

Source: World Bank, Doing Business, 2020

Starting a Business

2020 Rank	80/190
Procedures (number)	5
Time (days)	8
Cost (% of income per capita*)	30.2
Paid-in Minimum Capital (% of income per capita*)	0.0

*GNI per capita used: USD 440
Source: World Bank, Doing Business, 2020

Paying Taxes

2020 Rank	134/190
Payments (number per year)	23
Time (hours per year)	183
Total Tax Rate (% of profit)	38.3
Profit Tax (% of profit)	16.6
Labor Tax and Contributions (% of profit)	20.3
Other Taxes (% of profit)	1.5

Source: World Bank, Doing Business, 2020

Trading Across Borders

2020 Rank	140/190
Time to Export: Border Compliance (hours)	70
Cost to Export: Border Compliance (USD)	868
Time to Export: Documentary Compliance (hours)	49
Cost to Export: Documentary Compliance (USD)	117
Time to Import: Border Compliance (hours)	99
Cost to Import: Border Compliance (USD)	595
Time to Import: Documentary Compliance (hours)	58
Cost to Import: Documentary Compliance (USD)	150

Assumptions:
* It is assumed that shipment travels from a warehouse in the largest business city of the exporting economy to a warehouse in the largest business city of the importing economy.
* It is assumed that each economy imports a standardized shipment of 15 metric tons of containerized auto parts (HS 8708) from its natural import partner—the economy from which it imports the largest value (price times quantity) of auto parts. It is assumed that each economy exports the product of its comparative advantage (defined by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product.
* A shipment is a unit of trade. Export shipments do not necessarily need to be containerized, while import shipments of auto parts are assumed to be containerized.
* Shipping cost based on weight is assumed to be greater than shipping cost based on volume.
* If government fees are determined by the value of the shipment, the value is assumed to be $50,000.
* The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, airport or land border crossing.
* Time is measured in hours, and 1 day is 24 hours.
* Costs do not include tariffs.
Source: World Bank, Doing Business, 2020

Legal Framework

Investment Code - Law N. 2007-036 of the 14^th of January 2008. 

Key guarantees in terms of investment protection include:

• Any natural person or legal entity, Malagasy or foreign, is free to invest and settle down on the national territory, in accordance with the laws and regulations in force.
• Foreign and Malagasy investors are equally treated. 
• Foreign and Malagasy investors are free to hold up to 100% of the shares or stocks of the company. 
• The state guarantees that the individual or collective patent rights are respected.
• Foreign or local investors are authorised to freely transfer abroad without prior authorisation all profits after full payment of taxes, dividends, miscellaneous payments and repayments

Source: Economic Development Board of Madagascar, Law N° 2007-036 ,14 January 2008 on investments in Madagascar

Investment Incentives

• Preferential regime of FTZs, exclusively for activities directed towards export. This includes: 
• Exemption for five to ten years of the income tax following the activity, and the payment of the income tax at 10% thereafter;
• Exemption of the professional tax;
• Exemption of the customs duties, import tax and the VAT.
• Exceptional reduction of the taxation of companies by the abolition of VAT collection for exporting and EPZ firms up to the amount of their VAT credit; 
• Abolition of deposit payment and facilitation of income payment;
• Abolition of import tax on some goods such as cement, yarns and fabric, iron, steel, and other items for construction, agricultural material and equipment; 
• Abolition of VAT on the purchase of equipment good.
• Abundance natural resources 
• Low cost of local inputs and labour – Labour intensive industries, such as textile manufacturing

Special Incentives:

1- Companies investing in renewable energy, tourism, industrial, civil work and construction, and transformation:
Companies investing in renewable energy, tourism, industrial, civil work and construction, and transformation can benefit from a tax reduction equal to the tax calculated on 50% of the amount of investment that they realized during the related tax year.
2- Big Investment Mining (Investing more than $50 million)
The big investment mining law provides a minimum income tax exemption, a reduced CIT rate for the transformation entity (i.e. the entity in charge of processing the extracted minerals), exemption from custom and importation duties, and VAT reimbursement on locally purchased equipment and investments.
3- Petroleum code:
The petroleum code provides custom and importation duties exemption for hydrocarbon research, exploration, and exploitation activities.

Source: Deloitte, Guide to Fiscal Information, Key Economies in Africa 2018, PWC Madagascar Tax summary 2019