Press Release No. 14/321

Press Release: Statement by IMF Deputy Managing Director Min Zhu at the Conclusion of His Visit to Madagascar

June 30, 2014

Mr. Min Zhu, Deputy Managing Director of the International Monetary Fund (IMF), issued the following statement today in Antananarivo at the conclusion of his two-day visit to Madagascar:

“My visit has been very productive, and I wish to thank Prime Minister Roger Kolo, Minister of Finance and Budget Jean Razafindravonona, as well as Ms. Vonimanitra Razafimbelo, the Acting Governor of the Central Bank, for their hospitality and fruitful discussions.

“I also had the honor to address students at the University of Antananarivo, and IMF staff also visited the Akamasoa villages’ self-help community project and Anjozorobe, where the Non-Governmental Organisation (NGO) Fanamby is promoting environmental sustainability. These offered a good example of how poverty can be addressed with the aid of local resources and conservation activities.

“Our discussions with the authorities, students and civil society covered many topical issues, such as the maintenance of macroeconomic and financial stability, the role of the central bank in the economy, and the need for policies that can enhance inclusive and sustainable economic growth and poverty reduction.

“Over the last five years, slow growth and underperforming revenue collections led to a sharp compression of public investment and social outlays, and an accumulation of domestic budgetary arrears.

“Growth is expected to increase to 3 percent in 2014 thanks mostly to mining, and should rise further in 2015 as more reforms are put in place to boost the economy. We agreed with the authorities that the main medium-term challenge for Madagascar is to create a solid foundation for faster growth and poverty reduction.

“The authorities reiterated the government’s commitment to preserve macroeconomic stability; improve fiscal performance, strengthen governance and the rule of law; attract investors; and promote the private sector, which has a critical role to play in economic growth. The country needs to move back to higher, sustainable, and inclusive growth, which will raise living standards, create more jobs, accelerate poverty reduction and improve the investment environment. The IMF is ready to work with the government in the implementation of its economic program.

“It is in this regard that in June 2014 the IMF Executive Board approved financial assistance under the Rapid Credit Facility (RCF) in the amount equivalent to SDR 30.55 million (about US$47.1 million) for Madagascar in support of the authorities’ economic recovery program.

“The financial assistance from the IMF will be used to implement a set of economic and structural policies and measures aimed at restoring macroeconomic stability and strengthening the capacity of the Malagasy government (see Press Release No. 14/287).

“I am convinced that the government will carry on pushing for good governance and the rule of law, whilst also creating an enabling environment for business, investors and reforms that can be used to boost inclusive growth.”