Saving in Madagascar

Introduction

Madagascar is one of the many countries in the process of development in the World . According to the last World report on the Human development 2000 of which the data refer to the year 1998, Madagascar occupies the 141ème row on 174 countries in the world. Madagascar is classified in 146 ème position out of 177 countries, according to the 15th annual indicator of the human development (IDH) of the UNDP (figure 2006).

The Malagasy economy rests primarily on agriculture. It restarts since the crisis from 2001. The current capacity places from there (since 2002) works like a navvy to develop the country by calling upon all the forces of the Nation and the international community through the MAP (Madagascar Action Plan) in a relation of partnership.

To satisfy the request of the population, Madagascar proceeds to exports and imports which also make it possible the country to develop.

The development passes by the multiplication of the road infrastructures.

Agriculture

The god rice

The least recess of ground is dedicated to rice, an omnipresent cereal, which marks the landscapes of its print. Rice constitutes, indeed, the basic food. Cultivated rice with Madgascar is a rice of quality, more expensive than mattered Asian rice that consumes the population.

Zebus of Madagascar

The island of Madagascar counts as many Zébu S that inhabitants (17 million). The zebu, principal meat consumed in the country, is at the same time a crowned animal, an outward sign of wealth and a symbol of power, wisdom and hope in the future. In certain tribes of the south of the country, one becomes a man only if one flew of the zebus and one is powerful only if hundreds of heads are had.

Causes of the poverty of Madagascar

Madagascar a long time seemed a rich island of promises off Africa. Unfortunately, it is still today in a state of great poverty (146e country on 177 in term of IDH, indicating index of human development). The reasons of this poverty are multiple. However, in 1960, the RNB per capita of Madagascar was on the level of that of South Korea… Who exceeded it obviously well since…

The selected original socialist way in 1972 is one of the causes of the delay taken by the economy. Let us quote degradation continues infrastructures, the administrative brakes put at the development of the companies and investments, the land and legal insecurity… The direction of solidarity, the Fihavanana of the Madagascans, precisely praised is another factor. The members of the same family support the ones accurately the others, sometimes with depend on the personal initiative and the entrepreneurial spirit. Tendency reinforced by the massive presence of ONG on the spot in all the fields of the interdependent action: Environment, culture, health, education, childhood, agriculture… Perversely, the outside assistance becomes the most obvious source of enrichment, including personnel, without always constituting a base of sustainable development.

Political crisis

One of the reasons of the poverty of Madagascar is the political crisis which proceeded between 2001 with 2002. The dissension on the level of the elections between the candidates with the presidency is the cause of this crisis. This one caused many problems in particular the rise of the products of first need because of the installation of various stoppings blocking the exchanges between the capital and different the port cities.

The inflation of the currency and its causes and consequences

Definition and causes of inflation

First of all let us give a definition of the depreciation of a currency. This one constitutes a reduction in the value of a currency compared to other currencies or to a standard of reference in a system of flexible exchange. The inflation of Ariary is due primarily to the tax reduction of product electric household appliances, utility cars, machines industrial… The purpose of this one was to allow the economic advancement of the country but it did nothing but worsen it, the tax reduction had as a consequence an increase in the price of the imports and a reduction in the price of exports.

Consequences of the devaluation

In the trade, the devaluation involved a difference between the purchase price and the selling price because when a tradesman buys a product, the rate of the short balanced means is not the same one at the time of the purchase and the sale.

Taking into account the depreciation of the local currency the cost of labor dropped much. Indeed the Malagasy SMIC is approximately 60.000 Ariary (1 Ariary = 5 Fmg). In spite of the rise of the various prices because of devaluation, the wages increased only little, involving the dissatisfaction and the impoverishment of the Malagasy population.

The weak Malagasy wages have also advantages to the level of the labor, i.e. it can attract the various world investors. However Madagascar is not competitive on the level of the quality of the communication, of energy as well as infrastructures in general. For these reasons, Madagascar must make more to satisfy the needs for the foreign investors. They to date prefer to go to Eastern Europe, Asia and especially to China. These countries offer a cost of labor higher than that of Madagascar but bring important market potentials.

However, the phase of devaluation which removed half of its value to the Malagasy franc is to be brought closer to that of CFA franc in the previous decade: CFA franc related to the French franc, had a value on the foreign exchange market without relationship with the competitiveness of the West African economies and isolated them from the worldwide economy; its devaluation of 50%, though painful, will have had in the final analysis a rather positive effect. One can hope that beyond the current difficulties lived by the population, Madagascar finds its place in the worldwide economy by regional integration (in particular with the fall of the customs tariffs envisaged in zone SADC) the development of tourism and the remote services.

Ecological richness, human misery

How to explain that, in a well sprinkled country, where many food crops push, where abound fish, zebus and animals of farmyard, 34% of the children of less than 5 years suffer from ponderal insufficiency and 50% of a delay of growth moderate or serious? For little that you borrow public transport and traverse districts and villages, you will inevitably meet a father farmer which, at the period of welding between two harvests, does not have any more the moidre bowl of white rice to offer to his/her children and is obliged to be involved in debt near the usurer of the corner to survive; or a kid on a refuse tip, disputing - bitterly - with the pigs some scraps of food unearthed among the refuse.

Elsewhere in Africa , apart from the conflicts and of the great famines, it is rare to see somebody suffering from the hunger, even in the big cities of the poorest countries. Solidarity (family, ethnic, religious) there is still quite alive. has Madagascar , that does not seem not (more?) always true .

The state generated a considerable debt, the distribution chains of the agricultural produce function badly and the peasants, discouraged, decide more not to produce that for subsistence farming , with for consequence a fall condidérable of the production of rice, bases food of the Madagascans .

France, first foreign investor in Madagascar

Contrary to the frequently conveyed image, which makes of the Indo-Pakistani (“karana”) the main actors of the Malagasy economy, it is France which remains the foreign investor most present and most influential in Madagascar. the French investments account for approximately 65% of the stock of foreign entire investment in Madagascar , estimated at 320 million euros. The other foreign investors are primarily of origin Mauritian, indo-Pakistani, Chinese and Sri Lankian. More than 600 companies with French capital are present at Madagascar, including 359 participations and 157 subsidiary companies. The greatest French groups are represented, in very diversified sectors. One can quote, inter alia:

- Dominating for the banking environment, the Crédit Lyonnais/Crédit Agricole (alias BNI), General society (alias BFG-SG) and BNP-Paribas (alias BMOI),

- for energy, Total and Liquid air,

- for industry, Lafarge,

- for the building, Colas,

- for telecommunications, Alcatel, France Telecom, Orange, Satellite Channel,

- for international transport, Air France, Corsair and CGM,

- for the medicinal products, Baker, Fabre, Aventis, Mérieux,

- for data processing, Bull.

Their presence is old there for the companies of the sector of capital equipment and more recent in the fields recently opened with privatization or liberalized like the banking environments and of energy. The companies of average and small size constitute the major part of the French establishments in Madagascar. The companies of less than 50 employees represent half of the total alone. Those are particularly present in the service sector like engineering, the data processing data processing, the law firms and of council, the real estate, tourism, but also in textile industry, the international trade and the agroalimentary die.

In addition, more than one third of the companies gathered under the frank statute has a bond with France. For 18 of them they are subsidiary companies and 52 correspond to acquisitions of a holding. (Reference: Relationship submitted in the name of the commission of the foreign affairs on the law n° 1438 authorizing the approval of the agreement between the Government of the French Republic and the Government of the Republic of Madagascar on the reciprocal encouragement and the protection of the investments, BY Mr. RICHARD CAZENAVE, Appointed, 2004)

See too

Regional Programme of Protection of the Plants of the Indian Ocean

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