Madagascar needs fuel subsidy reforms - IMF

2014-07-01 14:39

(Shutterstock)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

kalahari.com

Antananarivo - Madagascar needs to reform its fuel subsidy programme which does not help its poorest people, a senior International Monetary Fund official said as the lender considers more funding for the Indian Ocean Island.

Famed for its wildlife and eyed by foreign companies for its minerals, Madagascar has struggled to lure back tourists and attract oil and mining giants since a coup in 2009.

The coup also prompted international donors to cut ties, leaving the economy to stagnate and poverty to deepen.

The IMF resumed its relationship with Madagascar earlier this year after peaceful elections in December, and in mid June approved a $47.1m emergency loan to help the country meet urgent balance of payment needs.

IMF's Deputy Managing Director Min Zhu said told Reuters in an interview late on Monday during a visit to the country that the government's fuel subsidy programme - which costs 1.5% of gross domestic product (GDP) - was not reaching the vulnerable.

Poorest people

"Studies show the poorest people do not benefit from the major part of the subsidy. The big chunk of the money goes to the middle and upper class," he said.

"The government needs to prepare a targeted programme to help the poorest because if there is an oil price increase the poor will suffer."

Without giving a specific forecast, Zhu said in a separate statement that Madagascar's economic growth was expected to rise further in 2015 compared with a 3 percent forecast for this year, helped mostly by the mining sector.

"The country needs to move back to higher, sustainable, and inclusive growth, which will raise living standards, create more jobs, accelerate poverty reduction and improve the investment environment," Zhu said.

Technical assistance

Madagascar has deposits of nickel, titanium, cobalt, iron, coal and uranium, and has shown hydrocarbon prospects that had previously attracted foreign firms seeking deals.

Among them, Rio Tinto began mining ilmenite, an ingredient used as pigment in paints, paper and plastics.

Zhu said the challenges Madagascar faced included the quality of its statistics, given they were based on data from 1993, and added the IMF would offer it all the technical assistance it needed to improve.

The IMF has scheduled talks in October where it will raise the issue of reforms in revenue collection, investment in education and healthcare and promotion of fiscal transparency, Zhu said.

"It is important to support Madagascar in this critical moment to move forward, after several years in very unstable political and economic situation," he said.

Read more on:    madagascar  |  southern africa
NEXT ON NEWS24X

SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/News
 
Traffic
Lottery
 
  • Monday Kuils River - 17:34 PM
    Road name: Polkadraai Road Eastbound
    ROADWORKS between the R102 Van Riebeeck Road and the R310 Baden Powell Drive exit
  • Sunday Parow - 08:10 AM
    Road name: Mike Pienaar Boulevard
    WEEKENDS - ROAD CLOSED between Voortrekker Road and Tienie Meyer Drive due to roadworks (until end July)
 
More traffic reports...
 

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Magical Massinga

Spend 5 nights at the gorgeous Massinga Beach Lodge in Mozambique and only pay for 4 from R13 220 per person sharing. Includes return flights, accommodation, transfers and romantic turndown. Book now!

Kalahari.com - shop online today

2 TV Series for R250

Get 2 TV Series box sets for R250 and save up to R148! Offer valid while stocks last. Shop now!

Mind blowing deals on beauty & fragrances

Save up to 30% off beauty and fragrances. Offer valid while stocks last. Shop now!

Up to 50% off hair care products!

Save up to 50% on professional hair care products at kalahari.com. Offer valid while stocks last. Shop now!

30% off academic books

Score a mind blowing 30% off academic books! Offer valid while stocks last. Shop now!

Mind blowing deals on electronics!

Save up to 35% on electronics. Offer valid while stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

BlackBerry Curve 3G 9300

Keep it together Text. Email. Social. With all the different ways to...

From R2499.00

I'm shopping for:

Horoscopes
Aquarius
Aquarius

There is a strong emphasis on relationships. Obsession, emotional disputes, retaliation or competitive actions are highlighted....read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.