The Board of the African Development Bank Group has approved a $68 million financing package for the Republic of Madagascar to support the second phase of the Financial Management and Economic Resilience Support Programme.
The package, comprising a $27.2 million concessional loan from the African Development Fund and a $40.8 million concessional loan from the Transition Support Facility, brings the total investment under the two-phase programme to $136 million, making it one of the Bank's most significant budget support commitments to the country.
The approval builds on a strong track record. The first phase of the programme achieved significant results for Malagasy households and businesses. These include a modern tax administration system now operational across the country and a national anti-corruption strategy that anchors accountability through 2030.
The second phase will deepen and extend these gains, with reforms in public financial management and private sector competitiveness that together aim to widen Madagascar's fiscal space and attract transformative investment.
"Madagascar has demonstrated the political will and institutional capacity to implement meaningful reforms under difficult circumstances," said Adam Amoumoun, the African Development Bank's Country Manager for Madagascar. "This programme consolidates those gains and opens the door to a more resilient, inclusive, and transparent economy--one that works for all Malagasy people."
The programme also supports the creation of an independent electricity regulator and a new National Fund for Sustainable Energy, with direct financing for off-grid and rural electrification, bringing light and economic opportunity to areas where nearly 80 per cent of Madagascar's poor live.
A modernised public-private partnership law provides the legal certainty that private investors in clean energy and infrastructure need to commit capital at scale.
Tax revenues are projected to rise from 10.5 per cent to 12 per cent of the Gross Domestic Product (GDP) by the end of 2026.
The programme's extension comes as Madagascar's new government, formed in March 2026, has reaffirmed its reform commitments alongside engagement from multiple development partners. The African Development Bank's approval adds financing to this broader effort.
