Madagascar held its first budget execution review in six years. Gathered in Ivato at the International Conference Centre, the administration delivered an unvarnished assessment: the overall domestic financing execution rate stands at just 24.84% — 503.22 billion ariary out of 2,026.09 billion programmed. For infrastructure alone, the figure barely reaches 32.41%.
Well-Identified Causes
Prime Minister Mamitiana Rajaonarison did not soften the diagnosis: despite some concrete achievements, overall execution remains weak. Finance Minister Herinjatovo Aimé Ramiarison identified a recurring bottleneck: «Compensation procedures for persons affected by major projects frequently slow investment progress.» Administrative red tape and governance issues make up the other major brake.
On the external financing side, performance is even more stretched: just 8.84% execution (608.53 billion ariary out of 6,875.87 billion programmed). For externally funded infrastructure, the rate reaches 17.47% — international donors and lenders have disbursed at a faster pace than the state itself.
Roads: The Nerve Centre of Economic Growth
Finance Minister Ramiarison highlighted the invisible cost of underinvestment: «Poor road quality costs Madagascar roughly 2% of GDP annually.» But the reverse is equally striking: quality roads can increase farmers' productive capacity by 40%. That single statistic illustrates the scale of potential gains from a properly executed infrastructure programme.
Why It Matters
The revival of the semi-annual budget review — absent for six years — is itself a positive signal: the government intends to steer public spending, not merely authorise it. Each ministry must now propose corrective measures with specific timelines. For foreign investors, traceability and transparency of public funds are non-negotiable. Madagascar has made the diagnosis; now it must demonstrate execution capacity.
Source: Newsmada / AllAfrica, August 2026 — Budget Execution Review, Ivato.