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Analysis and Studies - Country Analysis

Madagascar: a look at the market

By SkyMinder Sales Enablement Team August 23rd 2024

Madagascar's history is marked by a unique blend of cultural influences and periods of significant change. Human settlement on the island began around 1,300 years ago, with the first inhabitants believed to have come from Indonesia, and over time, these settlers were joined by African, Arab, and later, European traders and immigrants, creating a diverse cultural landscape. For many centuries, Madagascar was divided among several small kingdoms, each ruling distinct regions of the island. After more than a decade of fierce resistance from the island's kingdoms, France formally established Madagascar as a colony in 1896, effectively dismantling the traditional political structures.

After World War II the struggle for independence intensified, leading to the Malagasy Uprising of 1947, which represented a significant, though ultimately unsuccessful, attempt to break free from French control: despite the harsh suppression of the revolt, it set the stage for future independence movements. Finally, in 1960, Madagascar achieved its long-sought independence, marking a new chapter in its history.

The capital is Antananarivo: the name means "City of the Thousand," and was bestowed by 17th century King Andrianjaka to honor the soldiers assigned to guard the city.

 The flag of Madagascar consists in two horizontal bands of green and red with a vertical white band of running along the hoist; by tradition, red stands for sovereignty, green symbolizes hope and the coastal regions and white represents purity.

 

Madagascar has a high level of specialization in Vanilla ($583M), Cloves ($309M), Graphite ($78.5M), Uranium and Thorium Ore ($34.6M), and Raw Nickel ($929M).

 

 

In 2022, Madagascar was the 133rd economy in total exports with a trade of $4.25B, the 142nd in total imports with a trade of $5.45B.

In 2022 the most exported product was Raw Nickel, with a trade of $929M, ahead of Vanilla ($583M), Cloves ($309M), Cobalt ($224M), and Non-Knit Men's Suits ($152M), with the United States being the most significant destination (17.8%), followed by France (14.9%), China (12.7%), Japan (10.5%), and Germany (3.81%).

 The nation's export economy is marked by diversity but also reliance on a few major markets that make it vulnerable. Raw nickel is primarily exported to Japan and China, underscoring the nation's strong ties to East Asia’s industrial sectors.

 

Vanilla exports are predominantly destinated to the United States and France, with the United States also dominating imports of non-knit men's suits, reflecting significant demand in these Western markets, whereas cloves are mostly exported to Indonesia and Singapore, highlighting important regional trade links within Southeast Asia. Cobalt finds its primary markets in the Netherlands, Japan, Taiwan, and the United States, indicating its role in the global tech and electronics supply chains.

  1. Raw Nickel (21.9%): 40.3% Japan, 28.3% China, 15.1% South Korea, 6.05% Chinese Taipei, 3.3% United States, 1.86% Netherlands, 1.32% Germany, 0.2% France
  2. Vanilla (13.7%): 36.7% United States, 27.2% France, 9.81% Canada, 7.84% Germany, 5.92% Netherlands, 2.18% Mauritius, 0.84% Japan, 0.49% India, 0.32% South Korea
  3. Cloves (7.28%): 34.6% Indonesia, 26.4% Singapore, 19.1% India, 4.65% United Arab Emirates, 1.17% United States, 1.04% Germany, 0.7% Netherlands, 0.24% France
  4. Cobalt (5.27%): 32.5% Netherlands, 24.3% Japan, 19.9% Chinese Taipei, 8.53% United States, 7.25% China, 3.67% South Africa
  5. Non-Knit Men’s Suits (3.58%): 54.7% United States, 23.4% France, 7.8% South Africa, 2.85% Sweden, 1.85% Finland, 0.49% Germany

Whereas the most imported product was Refined Petroleum, with a trade of $625M, followed by Rice ($299M), Palm Oil ($187M), Light Rubberized Knitted Fabric ($159M), and Sulphur ($133M), importing mostly from China (24.4%), India (9.78%), France (8.65%), Oman (6.18%), and South Africa (5.77%).

The nation's import economy is centered around vital goods. Refined petroleum is the top import, with more than half coming from Oman, followed by substantial contributions from the Middle East, while rice imports are dominated by India, making the country dependent on this single supplier for a staple food.

Palm oil is largely imported from Malaysia, which supplies 88% of the market, indicating a highly focused trade relationship. The textile industry relies on light rubberized knitted fabric primarily from China, highlighting the country key role in the Madagascar’s manufacturing sector, whereas sulfur imports are mainly from Qatar and the United Arab Emirates, further underscoring the dependence on Gulf nations for important industrial materials.

  1. Refined Petroleum (11.5%): 51.4% Oman, 13% United Arab Emirates, 12.1% India, 10.3% Singapore, 4.82% Kuwait, 4.75% Qatar, 1.63% South Africa, 0.66% France
  2. Rice (5.49%): 74.9% India, 20.5% Pakistan, 3.99% Burma
  3. Palm Oil (3.43%): 88% Malaysia, 6.34% Indonesia, 5.15% Argentina
  4. Light Rubberized Knitted Fabric (2.92%): 58.6% China, 26.6% Mauritius, 5.65% Chinese Taipei, 1.9% France, 0.97% India
  5. Sulphur (2.43%): 66.3% Qatar, 23.1% United Arab Emirates, 10.6% Saudi Arabia

Between 2021 and 2022 the country which saw a fastest growth in exports was Japan, with an increase of $216M, followed by China ($160M) and United States ($149M).

 

 

  1. Japan: from $232M to $448M
  2. China: from $378M to $538M
  3. United States: from $607M to $756M

Whereas the fastest growing importer was China, with an increase of $194M, ahead of India ($193M) and South Africa ($118M).

 

 

 

  1. China: from $1.14B to $1.33B
  2. India: from $340M to $533M
  3. South Africa: from $197M to $315M

Sources: 

https://oec.world/en

https://www.cia.gov/the-world-factbook/countries/