Economy—overview: Madagascar suffers from chronic malnutrition, underfunded health and education facilities, a roughly 3% annual population growth rate, and severe loss of forest cover, accompanied by erosion. Agriculture, including fishing and forestry, is the mainstay of the economy, accounting for 32% of GDP and contributing more than 70% to export earnings. Industry features textile manufacturing and the processing of agricultural products. Growth in output in 1992-97 averaged less than the growth rate of the population. Growth has been held back by antigovernment strikes and demonstrations, a decline in world coffee demand, and the erratic commitment of the government to economic reform. Formidable obstacles stand in the way of Madagascar's realizing its considerable growth potential; the extent of government reforms, outside financial aid, and foreign investment will be key determinants.

GDP: purchasing power parity—$10.3 billion (1997 est.)

GDP—real growth rate: 3% (1997 est.)

GDP—per capita: purchasing power parity—$730 (1997 est.)

GDP—composition by sector:
agriculture: 32%
industry: 13%
services: 55% (1997 est.)

Population below poverty line: NA%

Household income or consumption by percentage share:
lowest 10%: 2.3%
highest 10%: 34.9% (1993)

Inflation rate (consumer prices): 4.5% (1997)

Labor force: 7 million (1995)

Unemployment rate: NA%

Budget:
revenues: $477 million
expenditures: $706 million, including capital expenditures of $264 million (1996 est.)

Industries: meat processing, soap, breweries, tanneries, sugar, textiles, glassware, cement, automobile assembly plant, paper, petroleum, tourism

Industrial production growth rate: 3.8% (1993 est.)

Electricity—production: 595 million kWh (1996)

Electricity—production by source:
fossil fuel: 41.18%
hydro: 58.82%
nuclear: 0%
other: 0% (1996)

Electricity—consumption: 595 million kWh (1996)

Electricity—exports: 0 kWh (1996)

Electricity—imports: 0 kWh (1996)

Agriculture—products: coffee, vanilla, sugarcane, cloves, cocoa, rice, cassava (tapioca), beans, bananas, peanuts; livestock products

Exports: $170 million (f.o.b., 1997)

Exports—commodities: coffee 45%, vanilla 20%, cloves, shellfish, sugar, petroleum products (1995 est.)

Exports—partners: France 31.7%, Japan 15.8%, Germany 6.4%, Reunion 5.7% (1996)

Imports: $477 million (f.o.b., 1997)

Imports—commodities: intermediate manufactures 30%, capital goods 28%, petroleum 15%, consumer goods 14%, food 13% (1995 est.)

Imports—partners: France 31.0%, Iran 9.1%, South Africa 8.2%, Japan 5.8%, US 5.0% (1996)

Debt—external: $4.4 billion (1996 est.)

Economic aid—recipient: $298.5 million (1995)

Currency: 1 Malagasy franc (FMG) = 100 centimes

Exchange rates: Malagasy francs (FMG) per US$1—5,468.5 (January 1999), 5,441.4 (1998), 5,090.9 (1997), 4,061.3 (1996), 4,265.6 (1995), 3,067.3 (1994)

Fiscal year: calendar year