It has been a difficult month for Madagascar. On September 25th, youth-led protests erupted over power and water cuts: within days the government fell; within weeks, civil unrest became deadly. In the last few days, a coup d’état has ousted (now former) President Rajoelina, and stripped him of citizenship.
But why is a resource-rich nation unable to keep the lights on?
Beyond the Blackout: How Policy and Fossil Fuel Reliance Plunged Madagascar into Darkness
This week, we will discuss whether resource sovereignty – or overreliance – culminated in Madagascar’s loss of power.
The Economic Development Board of Madagascar [1] note the nations’ potential for mining ilmenite (titanium), gold, platinum group metals, copper, zinc, nickel, cobalt and chromite. However, most of the extractive industry is artisanal for semi-precious stones following years of neglect and distrust, born from the 2009 Coup which bought Rajoelina to power.
These resources are critical to renewable energy production, but they remain in the ground.
In 2023, Madagascar generated 65% of it’s electricity from imported fossil fuels [2]
Since 2009, the drive in increasing energy production has been powered by Coal: increasing from 0% between 2000 and 2010; to 4.5-6% between 2011 and 2016; rising to 19% since 2017 (except 2020) [3].
Oil has seen a similar trend in Madagascar – as 35-40% of the energy share between 2000 and 2009; rising to 45-46% in 2010-11; gradually falling to 41% between 2012 and 2015; then becoming volatile between 2016 to 2023, peaking at over 50% in 2017 [3].
Question: has this growth been sustainable?
No.
Madagascar’s reliance on fossil fuels has increased since 2009, the supply and cost have been exacerbated by external factors such as the war in Ukraine or Trump Tariffs.
Mineral fuels accounted for US$ 997.1 million of Magsaysay imports in 2023, as their top import accounting for 20.7% by dollar value [3].
JIRAMA, the state-owned energy and water company, is near bankrupt – unable to reliably pay it’s suppliers, running on a deficit due to inefficient infrastructure, and is at the mercy of world event which it cannot control.
Energy dependance is not sovereignty. In fact, it is leverage for big players like China or the United States to offer support in return to favorable access to resources – on land or in the sea.
This is a policy failure – but also, a market failure. Read more, next week.
[1] https://edbm.mg/economic-data_sectors_mining-madagascar-land-of-hidden-treasures/
M-Cubed Research Consulting 