Madagascar - Economic Management Reform Support Programme

Project Summary

Approval Date	30 Mar 2016
Signature Date	26 Apr 2016
Planned Completion Date	31 Dec 2017
Last Disbursement Planned Date	31 Dec 2017
Sovereign / Non-Sovereign	Sovereign
Sector	Multi-Sector
DAC Sector Code	15124
Environmental Category	3
Commitment	U.A 12,500,000
Status	Completion

Project General Description

The PARGE is a support to the Republic of Madagascar for economic recovery and the implementation of its national strategy. This operation aims to consolidate previous budgetary support achievements and programmes and also to contribute to addressing the factors of fragility linked to: (i) growing poverty; (ii) poor management of public resources; (iii) low private investment and a deteriorating business climate; and (iv) rising unemployment and underemployment, especially among youth and women. The PARGE is structured around two complementary components: (i) Broadening the fiscal space to better support economic growth; and (ii) Promoting economic recovery through investments that create jobs and reduce socio-economic inequalities. Its implementation will have a distributive and sustainable impact, allowing the State to have the necessary budgetary space to improve the provision of essential social services, including education and health, and to better promote public and private investment.

Project Objectives

The development objective of the PARGE Reform Programme is to contribute, in consultation with other development partners, to creating the conditions for inclusive, strong and sustainable growth through the strengthening of economic management. The operational objectives of this reform programme are: (i) improving tax revenue mobilization; (ii) rationalizing public spending; (iii) improving the efficiency of public spending; and (iv) promoting investment.

Beneficiaries

The Malagasy populations, which have been severely affected by the adverse effects of the five years of socio-political crisis, will be the main beneficiaries of the programme. The payment of domestic arrears and the increase in productive public investment will mainly enable economic operators to benefit from business opportunities, thus contributing to the creation of national wealth and job creation, for the benefit of young people and women.

Participating Organization

Funding

African Development Fund

Implementing

Ministry of Finance and Budget (MFB)

Information

IATI identifier	46002-P-MG-KA0-009
Last Update	01 Feb 2023

Export

Contact Details

Name	UMUBYEYI Angelique
Email	a.n.umubyeyi@afdb.org

Geographic Location

Country	Madagascar

Coordinates	Location Name
-18.75 46.75	Antananarivo Province

Project Classification

Finance Type	Aid Loan Excluding Debt Reorganisation
Flow Type	ODA
Aid Type	General Budget Support

Commitments

U.A 12,500,000

African Development Fund

U.A 12,500,000

Disbursements

Repayments (Interest & Loan)

Document Type	Language	Document
Evaluation Report	fr	PN10786 SR FR
Project Completion Report	fr	PR10841 SR FR
Project Completion Report	en	MADAGASCAR ECONOMIC MANAGEMENT REFORM SUPPORT PROGRAMME
Appraisal report	en	Madagascar PARGE Appraisal Report ENG Final
Appraisal report	fr	MADAGASCAR PARGE Rapport Evaluation FR finale
Project Completion Report	fr	madagascar-economic-management-reform-programme-parge-pcr-103836
Project Completion Report	fr	viewer

Indicator	Indicator Measure	Target Year	Target Value	Actual Year	Actual Value
Tax revenue (as a percentage of GDP)	%	2016	10,8	2018	10,8
Non-productive expenditure differential (as a percentage of GDP)	%	2016	0,6	2018	0,7
Public investment rate (as a percentage of GDP)	%	2016	5	2018	5,2
Private investment rate (as a percentage of GDP)	%	2016	13	2018	15,2
Minimum level of tax revenue collected from the beginning of the year	MGA billion	2016	3500	2018	3635
Number of taxpayers for all categories of taxes	Number	2016	245000	2018	254584
Number of large- and medium-sized enterprises liable to corporate income tax	Number	2016	617	2018	618
Ex post Control Procedures Manual adopted	None	2016	Yes	2018	Yes
Corporate control charter adopted	None	2016	Yes	2018	Yes
Number of spot tax audits	Number	2016	70	2018	101
Salary expenditure on fictitious job positions identified in the payroll of senior civil servant	MGA	2016	0	2018	0
Medium-term debt management strategy prepared and adopted	None	2016	Yes	2018	Yes
Decree setting up debt technical committee	None	2016	Debt technical committee established by CM decree in 2015	2018	Debt technical committee set up by CM decree in 2015
Ceiling for subsidies and effective direct transfer payments	MGA billion	2016	325	2018	281,05
Differential between the calculated benchmark price (CBP) and the current pump price (CPP)	MGA	2016	0	2018	0
Manual on the selection criteria for public investment projects	None	2016	Manual prepared and adopted by the CM in 2016	2018	Manual prepared and adopted by the CM in 2016
Minimum limit on social spending financed with domestic resources (commitment basis)	MGA billion	2016	73	2018	106,8
Minimum limit on public investments (PIP) financed with domestic resources (commitment basis)	MGA billion	2016	420	2018	492
Agreement to be renewed on clearance of VAT refund arrears (oil and mining)	None	2016	Agreement renewed and signed in late 2015 on at least 95% of the arrears by end October 2015	2018	Memorandum of understanding signed in January 2016 (Mining) and regulatory texts taken at the end of 2016 (Petroleum)
Implementation rate of annual clearance commitments	%	2016	95	2018	100
An escrow account for VAT credit refunds	None	2016	An escrow account is opened at the Central Bank in 2016 for VAT credit refunds	2018	An escrow account is opened at the Central Bank in 2016 for VAT credit refunds
Public-Private Partnerchip (PPP) bill	None	2016	Bill adopted by CM and transmitted to Parliament in 2015	2018	Bill adopted by CM in 2016
Public-Private Partnership (PPP) policy and manual	None	2016	PPP manual and policy prepared and adopted by CM in 2016	2018	Under way