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Madagascar: World Bank Approves US$80 Million for Poverty Reduction in Madagascar

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News Release No:2006/021/AFR

Media Contact

In Washington:

Aby Toure (202) 473 8302

In Madagascar:

Jocelyn Rafidinarivo (261-20) 225 6000



Washington DC, July 12, 2005 – The World Bank Board of Executive Directors today approved an International Development Association (IDA) credit* of US$80 million to support the implementation of Government’s Poverty Reduction Strategy Paper (PRSP).


The Second Poverty Reduction Support Credit (PRSC 2) will deepen and consolidate reforms, that were initiated under the first PRSC approved in July 2004, in fighting corruption, improving public expenditure management and customs, and in implementing the Education for All and nutrition programs.  It will also help expand access to safe drinking water, improve health outcomes and provide protection from shocks.


On governance, PRSC 2 aims to assist the Government in continued implementation of its 2004 Priority Action Plan for public expenditure management reforms, and in developing the follow-on 2005 Priority Action Plan.  The main achievements include improved alignment of the 2005 budget to the priorities of the PRSP, introduction of program budgets, which have both introduced a medium-term perspective and progressive implementation of the procurement reform.  A customs strategy and action plan have also been formulated.


The Second Poverty Reduction Support Credit continues to support the Government’s Education for All (EFA) with continued support to policy measures aimed at increasing access to, and quality of, primary education, including the update of the EFA plan, elimination of school fees and provision of learning materials to all primary students.  PRSC 2 also supports policy and institutional reform in the nutrition sector (through the setting up of a National Nutrition Council and its secretariat) and in the health sector, with the update of the national health policy, and improved access to rural water through the development of a Water for All program.


The proposed series of PRSCs will contribute to Madagascar reaching its development goals.  The reforms will strengthen the institutional infrastructure needed to improve the public sector’s capacity to carry out its role more effectively”, said Benu Bidani, the World Bank Task Team Leader of the project.


Improved delivery of public services is essential if the Government is to reach its goals for poverty reduction and improve the quality of life in Madagascar”, Bidani added.


Madagascar has maintained its focus on implementing its poverty reduction strategy with good results evident particularly in the implementation of the Education for All and nutrition programs, and improving the institutional environment for anti-corruption. The country has reached the Heavily Indebted Poor Countries (HIPC) Initiative completion point in October 2004 bringing significant debt relief and improved prospects to maintain sustainable debt levels in the medium term.  Madagascar has also recently become the first country to receive financing from the Millennium Challenge Account.




* The credits are on standard International Development Association (IDA) terms, with a commitment fee of 0.5 percent and a service charge of 0.75 percent. The period of maturity is 40 years, including a 10-year period of grace.



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