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# [MADAGASCAR] AIIB Set to Co-Finance $100 Million for Transport: Infrastructure Gap Costs 2% of GDP Annually
- URL: https://businessoi.media/en/madagascar-aiib-pret-a-cofinancer-100-millions-usd-pour-les-transports-le-deficit-dinfrastructures-coute-2-du-pib-par-an-en/
- Published: 2026-10-16T08:45:06.000Z
- Updated: 2026-10-16T08:45:06.000Z
- Description: The AIIB is set to co-finance USD 100M for Madagascar's transport sector. The infrastructure gap costs 2% of GDP annually; recent investments have already generated +1.1% of GDP.
- Author: Emmanuel TAOCHY
- Tags: Madagascar, Investissement, Économie, Flash de mi-journée, #en

Madagascar has reached a decisive milestone in its infrastructure strategy. The Asian Infrastructure Investment Bank (AIIB) is set to approve a contribution of approximately **USD 100 million** for the island's multimodal transport and logistics programme, co-financed with the World Bank. The AIIB Board decision is expected as early as Q1 2027.

## An infrastructure gap costing 2% of GDP every year

The stakes are considerable. According to Madagascar's Minister of Economy and Finance, the infrastructure deficit weighs on the national economy by approximately **2% of GDP annually**. Over a decade, this equates to several points of lost growth. Conversely, investments made over the past ten months have already generated an estimated gain of **1.1% of GDP**.

To accelerate without burdening public debt, Antananarivo is prioritising co-financing arrangements with multilateral lenders: the World Bank, the African Development Bank, and now the AIIB, of which Madagascar has been a member since 2018.

## Three projects in the pipeline

The multimodal transport and logistics programme is the most advanced file, with the rail component still being defined. Two other projects are also under AIIB preparation: an improvement of the corridor linked to the RN9, for which preparatory studies have already received support, and a green energy project that Madagascar intends to structure with multiple international partners.

The AIIB's increase of its maximum financing share for non-regional members — raised from 15% to 25% — directly improves Madagascar's access to the Asian bank's resources.

## A strong signal for East Africa

Looking ahead to 2026-2027, Madagascar is part of a regional dynamic to modernise logistics infrastructure. The port of Toamasina, currently being expanded, is set to become the largest in East Africa. The AIIB's mobilisation strengthens the credibility of the government's plans and sends a positive signal to private investors who might finance the missing links.

## Why it matters

Madagascar is making a strategic bet: closing an infrastructure gap accumulated over decades, without compromising debt sustainability. Every billion invested in transport directly translates into lower logistics costs for Malagasy exporters — vanilla, ilmenite, graphite — and stronger regional competitiveness. The AIIB-World Bank convergence on the same projects is a rare signal of confidence in the country's reform trajectory.