Madagascar Economic Update

Madagascar's economy is recovering but remains uneven. Growth is estimated at 4.2 percent in 2024. Several sectors in the economy have yet to return to their pre-2020 output levels. The services sector has driven growth on the supply side, especially tourism-related sectors and telecommunications. Following reforms to improve the business climate, private investment has become the key engine of growth on the demand side. Stubbornly high core inflation diminished private consumption's contribution to growth in 2024, and the contribution of net exports to growth turned negative. Meanwhile, employment-intensive sectors such as agriculture, agrobusiness, and textiles have struggled to recover, especially in terms of value addition per capita