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Madagascar

Madagascar is renowned for being one of nature’s paradises. But this paradise is under threat from deforestation and severe resource depletion. Since the start of 2014, the country has once again been run by a democratically elected government. Between 2014, when the democratic government took power, and 2020 the economy had a chance to recover, which had a positive impact on the labour market and helped to decrease the rate of poverty. Yet three out of every four Madagascans are still living on less than USD 1.90 per day, and more than half of the approximately 25 million citizens suffer from hunger. The primary objective of the German development cooperation in Madagascar is to protect nature and natural resources, which helps to protect the livelihoods of the population.
Households on low incomes in Madagascar have very little access to loans or other official financial services, such as savings accounts. KfW Development Bank provides support to Access Bank Madagascar (ABM), which provides savings products and loans to small companies, micro companies and farmers. If a borrower successfully pays off a loan, they are able to borrow larger sums next time. This helps both to improve businesses’ productivity rates and to increase the income of the banks’ customers. The demand is huge, and every year the bank acquires more and more customers.
Another of KfW Development Bank’s objectives is to help expand the range of financial services offered by the ABM. Particular focus areas in this regard are housing financing, and investments in renewable energy sources and energy efficiency. By developing specific finance products and improving lending practices, for example through digitalisation, the bank is able to offer customised services to the middle classes, the poorest in society and small businesses. Long-term loans can enable the purchase of solar-home systems or the acquisition of living space, for example.
The ABM is part of the Access Holding network, which consists of six micro financial institutions in Africa. It has a banking license and complies with internationally recognised standards, helping to ensure transparency and protect customers against excessive indebtedness.
Project information -
Despite deforestation and urban pressure, Madagascar still has unique natural environments with fascinating flora and fauna. The German development cooperation (DC) promotes environmental protection and conservation, which in turn helps to combat poverty. Only by keeping nature intact will it be possible to maintain the livelihoods of Madagascans and offer perspectives on how to use and valorise precious resources in a sustainable manner.
On behalf of the German Federal Government, KfW Development Bank provides support directly to important conservation areas, which should also benefit the local population. The focal points of this undertaking are the efficient and sustainable management of the conservation areas, and ecotourism.
The number of tourists remains far too low to cover the costs for preserving the parks in question. For this reason, KfW and other international organisations have helped to finance a trust for preserving Madagascar’s conservation areas and biodiversity. The interest generated by the trust capital already covers some of the operating costs of managing the individual parks.
KfW also provides support for the forestation of degraded land with tree species used for energy and timber production and with alternate crops, the protection of this land against erosion, the sustainable management of grazing areas, and the securing of land use rights for participating farmers. Forestation efforts serve to meet the rising demand for charcoal, which would otherwise result in the continued deforestation of Madagascar’s endangered natural forests. The erosion control measures reduce silting in the rice fields and stabilise the water balance.
Project information - timber production (PDF, 167 KB, non-accessible)
Project Information - conservation (PDF, 123 KB, non-accessible)
Further information
- Learn more about the impact of our work in Madagascar in our transparency portal
- Read more about our completed projects in the evaluation reports on Madagascar
- The BMZ's priorities in Madagascar can be found directly on the Ministry's website
- On the website of the Federal Foreign Office you will find detailed information about Madagascar
Contact
KfW Development Bank
Phone: +49 69 74 31-42 60