This information is derived from the State Department’s Office of Investment Affairs’ Investment Climate Statement. The U.S. Department of State’s Investment Climate Statements provide information on the business climates of more than 170 economies and are prepared by economic officers stationed in embassies and posts around the world. They analyze a variety of economies that are or could be markets for U.S. businesses. The Investment Climate Statements are also references for working with partner governments to create enabling business environments that are not only economically sound, but address issues of labor, human rights, responsible business conduct, and steps taken to combat corruption. The reports cover topics including Openness to Investment, Legal and Regulatory Systems, Protection of Real and Intellectual Property Rights, Financial Sector, State-Owned Enterprises, Responsible Business Conduct, and Corruption.
Executive Summary of the ICS 2025
Madagascar offers a wealth of natural resources, including unique biodiversity and diverse mineral resources, making it a prime destination for investment in agriculture, mining, tourism and ICT sectors. Its membership in key regional trade agreements provides access to over a billion potential consumers across Africa and globally. The country boasts infrastructure somewhat to be rehauled, including ports, airports, and modern digital connectivity, supporting global business operations. Recent regulatory reforms ensure a stable and transparent business environment, with protections for foreign investors and simplified processes for establishing and operating businesses. With comprehensive government support services, Madagascar could be an attractive and secure investment destination provided every law and regulation are properly enforced, and corruption eliminated.
Madagascar offers comprehensive investment support services, including expert sector-specific investment managers and advisory services. A one-stop investment facilitation service streamlines business registration, permits, work permits, and long-stay visas for investors and their families. The service also assists with free-zone approvals, land acquisition information, and simplifies pre- and post-establishment processes. With nearly two decades experience, this system reduces startup costs and processing times for investors.
The newly enacted Investment Law and multiple regulatory reforms aim to create a secure and attractive business environment, supporting the country’s development plan. It aligns with international investment standards in order to enhance investor confidence. Madagascar’s new Mining Code enforced on October 2024 implements significant reforms to the country’s mining sector. Additional measures continue to bring more transparency to the mining and oil industry in order to attract high-quality investments. For U.S. investors and businesses considering operations in Madagascar, understanding the strengths and potential challenges particularly of the mining code, the law on large mining investment, and the subsequent reforms is critical.
A young and skilled workforce enhances the country’s attractiveness, with government-led vocational training initiatives ensuring a competitive labor market, especially in textile manufacturing and craftsmanship. Business security is a priority, with Madagascar continuously reinforcing legal protections, enhanced anti-corruption strategy and measures, and transparent regulatory frameworks to safeguard investments. Sustainable development objectives are integrated into policies, promoting renewable energy, sustainable agriculture, and eco-friendly technologies.
Despite funding shortfalls, the country possesses several assets that can drive successful development. However, achieving rapid progress will require a strong commitment to change from the governing authorities. This commitment should be paired with a realistic vision, extensive expertise, and a deep understanding of global competition. These elements are crucial for the country to catch up and advance more quickly.