Madagascar - Country Code 261

Madagascar was one of the last major landmasses on earth to be colonized by humans. The earliest settlers from present-day Indonesia arrived between A.D. 350 and 550. The island attracted Arab and Persian traders as early as the 7th century, and migrants from Africa arrived around A.D. 1000. Madagascar was a pirate stronghold during the late 17th and early 18th centuries, and served as a slave trading center into the 19th century. From the 16th to the late 19th century, a native Merina Kingdom dominated much of Madagascar. The island was conquered by the French in 1896 who made it a colony; independence was regained in 1960. During 1992-93, free presidential and National Assembly elections were held ending 17 years of single-party rule. In 1997, in the second presidential race, Didier RATSIRAKA, the leader during the 1970s and 1980s, was returned to the presidency. The 2001 presidential election was contested between the followers of Didier RATSIRAKA and Marc RAVALOMANANA, nearly causing secession of half of the country. In April 2002, the High Constitutional Court announced RAVALOMANANA the winner. RAVALOMANANA won a second term in 2006 but, following protests in 2009, handed over power to the military, which then conferred the presidency on the mayor of Antananarivo, Andry RAJOELINA, in what amounted to a coup d'etat. Following a lengthy mediation process led by the Southern African Development Community, Madagascar held UN-supported presidential and parliamentary elections in 2013. Former de facto finance minister Hery RAJAONARIMAMPIANINA won a runoff election in December 2013 and was inaugurated in January 2014.

Madagascar is a free market economy with many untapped natural resources, but no capital markets, a weak judicial system, poorly enforced contracts, and rampant government corruption. The economy faces long-term challenges to improve education, healthcare, and the environment. Agriculture, including fishing and forestry, is a mainstay of the economy, accounting for more than one-fourth of GDP and employing roughly 80% of the population. Deforestation and erosion, aggravated by bushfire and the use of firewood as the primary source of fuel, are serious concerns.

After discarding socialist economic policies in the mid-1990s, Madagascar followed a World Bank- and IMF-led policy of privatization and liberalization until the onset of a political crisis, which lasted from 2009 to 2013. The free market strategy had placed the country on a slow and steady growth path from an extremely low starting point. Exports of apparel boomed after gaining duty-free access to the US in 2000; however, Madagascar's failure to comply with the requirements of the African Growth and Opportunity Act (AGOA) led to the termination of the country's duty-free access in January 2010, a sharp fall in textile production, and a loss of more than 100,000 jobs.

Madagascar regained AGOA access in January 2015 following the democratic election of a new president the previous year. In November 2015, the International Monetary Fund (IMF) approved a Rapid Credit Facility to Madagascar worth about $42.1 million to help the government meet its balance of payments needs. The IMF judged that Madagascar had demonstrated satisfactory performance on macroeconomic performance and structural reforms, and in mid-2016 approved another $304 million extended credit facility for the country. GDP growth is expected around 2.8% per year in 2016-17, due to underperformance in agriculture.