Country context (P3 lens)

Madagascar is a low-income country with a nascent P3 market. P3s are intended to mobilize private capital, accelerate infrastructure delivery, and transfer operational risk, primarily in transport, energy, and social infrastructure. The government has established P3 legislation and institutional frameworks, but practical experience is limited. Most projects rely on multilateral or donor support to become financially viable.

Verified sources: World Bank PPP Knowledge Lab, Madagascar Ministry of Economy and Finance, IMF, African Development Bank.

Economic and infrastructure conditions

• Economy: Agriculture, mining, and fisheries dominate; infrastructure investment is essential for trade, energy access, and service delivery.

• Infrastructure priorities:

  • Roads, bridges, and transport corridors

  • Electricity generation (hydropower, solar) and distribution

  • Water supply, sanitation, and municipal services

  • Hospitals, schools, and social infrastructure

• Private sector: Domestic investor base is small; most P3 projects require regional or international investors, often with donor guarantees.

Projects are typically medium-scale, donor-backed, and structured for predictable cash flows.

Public Private Partnerships framework

Legal and institutional setup

• Madagascar’s P3s are governed by the Public-Private Partnership Framework (2015), overseen by the Ministry of Economy and Finance.

• Project approval requires feasibility studies, value-for-money assessments, fiscal risk evaluation, and multilateral advisory support.

• Typical P3 structures:

  • Concessions for transport infrastructure (roads, bridges)

  • Build-Operate-Transfer (BOT) for energy and utilities

  • Availability-payment contracts for hospitals, schools, and municipal services

Market characteristics

• Madagascar’s P3 market is nascent, with strong reliance on multilateral advisory support from the World Bank, AfDB, or IMF.

• Financing structures include availability payments, revenue-sharing, and donor-backed blended finance.

• Investor participation is largely regional or international, due to limited domestic financial and technical capacity.

Sector experience and opportunities

Transport

• Roads, bridges, and regional corridors are primary P3 opportunities.

Energy and utilities

• Hydropower, solar, and small-scale renewable energy projects delivered under BOT or concession models.

• Transmission and distribution may involve private participation under structured agreements.

Water and municipal services

• Water supply, sanitation, and wastewater projects structured as service contracts or concessions.

Social infrastructure

• Hospitals and schools delivered through availability-payment P3s, often with multilateral or donor support.

Key P3 considerations

• Fiscal risk management: Government guarantees or donor support are critical.

• Institutional capacity: P3 units and ministries provide oversight but rely heavily on multilateral advisory support.

• Market depth: Very limited domestic investor base; regional and international investors are essential.

• Project selection: Focus on revenue-generating or donor-supported projects for bankability.

Outlook

Madagascar is a nascent P3 market with potential in transport, energy, water, and social infrastructure:

• Focus sectors: roads, hydropower, water, and social infrastructure

• Projects are generally medium-scale, government-backed, and structured for predictable returns

• Multilateral advisory and financing support is key to successful project delivery

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