An agreement signed in New York on October 6, 2026 could mark a turning point in development financing for Madagascar. The Malagasy Sovereign Fund (FSM), linked to the Presidency of the Refoundation, and Gemcorp Capital Limited, a British investment fund, announced a partnership aimed at mobilising up to $500 million over four years for strategic projects in mining, energy, water, and infrastructure.
Three Priority Sectors
The partnership primarily targets critical minerals — graphite, cobalt, and rare earths — resources that Madagascar holds in abundance and for which global demand is surging, driven by the energy transition. On the energy side, three hydroelectric power plants and photovoltaic solar units are in the pipeline. Water and basic infrastructure round out the scope. According to Bloomberg, which first reported the announcement, the signature reflects Gemcorp's intent to deepen its footprint in sub-Saharan Africa.
The FSM Builds Institutional Capacity
Beyond capital, the FSM is expected to gain expertise in financial structuring and in attracting international private capital — a rare skill in Africa and one that is critical to reducing dependence on official development aid. « The sovereign fund's role is to position Madagascar as a credible destination for private capital, » a source close to the matter said.
A Challenging Financing Context
This partnership comes as budget execution struggles to reach 44.2% ahead of the final quarter of 2026, and with over 1,000 billion ariary reportedly stalled in the financial circuit due to disbursement delays, according to an analysis published by Newsmada on October 16. The Gemcorp announcement therefore stands in contrast to the slow pace of existing public financing flows.
Why It Matters
Madagascar holds critical mineral resources the world urgently needs, yet its economy consistently struggles to convert underground wealth into development. The FSM–Gemcorp partnership signals that international private capital is beginning to take the island seriously. The real test is whether these projects materialise beyond the announcement phase — a well-documented structural challenge for Madagascar. The next few months will be telling.