One of the few redeeming virtues of economists is that we're genuinely interested in the problems of other people. The worse the calamity, the more economists turn into Job's Comforters. Usually it's Argentina that gets the regular visits from Eliphaz the Temanite and his ilk, Well, Madagascar is a lot like Job. So where are the economists?

A lot of this is because Madagascar's problems are perennial; economists can point to unresponsive leaders such as Didier Ratsiraka and Albert Zafy¹, the colonial legacy of almighty lumber firms (that denuded the island during the 20th century, then exported trees and profits to France), political instability, and social stratification. Population growth on the island is quite rapid (over 3% annually) and the country is heavily dependent upon foreign aid. The ultimate cause of Pres. Albert Zafy's impeachment in '96 was an effort on his part—along with Raoul Ravalomanana, the chair of the central bank—to surreptitiously promise to pay off foreign debts. That it should come to this—a constitutional crisis over the repayment of sovereign debt—reflects badly on the country's financial reliability.

Madagasgar's godfather was, from '75 to '02, Didier Ratsiraka—a Roman Catholic member of the Betsimisaraka group of côtiers who initially sought close ties with Moscow, Havana, Hanoi, and Pyongyang. This reflected the nature of the military council that took power in 1972, during a period of acute civil strife. Later, Pres. Ratsiraka became very pliant towards Western aid donors; like many initially radical leaders, he was jerked back into line with so much the greater brusqueness [*]. Yet the nation's economy did not diversify; rather, it retreated from many traditional enterprises. It balances the budget now with foreign aid; it must import rice, and is currently plagued by soaring prices for rice. In April, it was struck by two typhoons with devastating results. It suffers from ongoing political violence, which—while not especially bloody, compared to places like Colombia—is still definitely terrorism.

The country's precarious medical services are, naturally, frequently hit by challenges like the cholera epidemics or lethal flu strains. So far, thankfully, AIDS infection rates are low.

At the back of most of these problems is deforestation, a process described in detail by Prof. Tim Tietenberg:

Madagascar's domestic economy, from the beginning, has been geared toward export promotion. Exports consisted primarily of coffee, but rice and beef were sold abroad as well. Coffee was originally planted on only the east coast, but expanded across the island when it became apparent that producers were able to generate large profits. Because of this expansion of coffee, the island's economic development was uneven. Rice shortages resulted as early as 1911 because of the excess demand for labor in the coffee sector, and the nation's "food security" began to erode. Rice was also more vulnerable to changes in the weather and cyclones, which exacerbated the shortages. Peasants that once worked cultivating the nation's rice moved into regions where they were able to cultivate coffee because of the higher wages. These peasants would then clear additional land so that they could practice shifting cultivation and generate enough food to subsist.

In response to the increasing shifting cultivation, or tavy as it is called locally, the Governor General prohibited its practice in 1909. The state's objective of this ban was to try and save what was left of the nation's forest as well as impose "rational forest resource management" (Jarosz 373). However, the land set aside by the state for nation's rice cultivation was inefficient because of soil problems. The policy was therefore ineffective in erasing Madagascar's rice production problem. The government also thought that the ban would give them a greater ability to collect taxes because it would be easier to locate citizens if they were forced to remain in one place.

The Malagasy interpretation of the ban was almost entirely opposite of the state's intentions. They viewed wage work as equivalent to enslavement and many revolts took place. Not only did the Malagasy ignore the ban, but they illegally burned many acres of forest in protest. "The ban elevated the practice of tavy to a symbol of independence and liberty from colonial rule" (Jarosz 373). The Malagasy viewed shifting cultivation as a sacred means of survival that they were taught by their ancestors. Because of the protests and the fact that the ban was largely unenforced, whatever good intentions the government had were never realized.

The forest degradation problem became even more serious when the state decided to open up the island's forests to concessionary practices in 1921. Many viewed it as ironic that the state allowed massive clear cutting on concessions while the ban on shifting cultivation was still in effect. More than just the claimed lands were ruined however, because many owners clear-cut lands beyond their concessionary limits. The Forest Service was unable to regulate the concessions because of shortages in labor and "a lack of political will." Much of the illegal felling of trees was completely overlooked and the fines that were levied for violation of the permits were far lower than the actual damages. The combination of these detrimental government policies meant that "roughly 70% of the primary forest was destroyed in the 30 years between 1895 and 1925" (Jarosz 375).

Today the country is suffering a population boom driven partly by the introduction of vaccines and foreign aid-financed medical care. At the same time that the aid has reduced mortality, it has not acted to alter the economic relations that led to sequestered women and high fertility rates.² Likewise, these economic relations have driven slash-and-burn farming into the remaining forested areas, just as they did all through Southern Asia during European imperialism. Eighty percent of the country remains rural, poverty is crushing, and the forest's disappearance from this gigantic island has left nothing of value in return.

Yet what about the Bretton Woods institutions?

World Bank Poverty Reduction Strategy: Madagascar’s PRSP assigns governance reforms the central role in the fight against poverty. The staff fully agrees with the centrality of governance reforms to improve public service delivery and to create an environment conducive for private investment. While economic and structural reforms had well advanced between 1997 and 2001, governance reforms lagged significantly behind. The new government that took office in 2002 faced the following major problems, as assessed by the staff: poor financial management practices, piecemeal program evaluation, and poor accountability structures, a high level of perceived corruption (Madagascar ranked 98th of 102 countries in the Corruption Perception Index of Transparency International), cumbersome customs procedures, a judicial sector ineffective in enforcing contracts or property rights, an administration that could not access a large share of the population (which is rural), forestry and mining sectors operating outside the formal economy, and a decentralization strategy that would adversely affect communes.
[p.9-10]

They do seem to address the matter here:

[p.11] However, the staff would like to raise three concerns regarding the presented strategy and would like to encourage the government to refine its rural and environmental strategy in the first annual progress report of the PRSP. First, the rural development section of the PRSP does not start from a review of why such policies have largely failed in the past. This would be an important analysis to undertake as massive investments are currently planned (for instance, in irrigation, which have not worked in the past), which may require complementary institutional changes (such as the creation and empowerment of Water User Associations) and investments in other sectors (such as in energy and transport) to yield results. Similarly, severe governance problems in the forestry sector have undermined successful environmental protection in the past, and the new government has taken decisive action to deal with them (e.g., freezing new forestry permits, and banning log exports). The staff suggests that the annual progress reports of the PRSP include an analysis of the impact of recent actions, along with a concrete agenda for the future. Second, the PRSP largely fails to establish the links between the identified objectives, actions to be taken, and expected results. The section on raising agricultural productivity—at the heart of the strategy—remains unspecific and states only broad policy objectives about relaunching agricultural production or production of locally certified and improved seeds. The continuation of fiscal measures with respect to rice protection and input taxation, which were introduced in 2000 to improve the rural terms of trade, and especially those for rice producers, are likely to be key in raising rural productivity. Supporting measures such as improving market access by producers will also be necessary in this respect. Similarly, the PRSP places emphasis on development of high potential areas and the development of an export-oriented agro-business sector, but stops short of outlining how such investment and export diversification will be financed and implemented. The strategy outlines that income growth in the less favorable zones would stem from diversification into nonfarm activities, but the PRSP does not specify if necessary investments to achieve a minimum infrastructure platform (which would include roads and electricity) would be prioritized to help these poorest areas of the country.

SOURCES: US State Department Background; CIA World Factbook entry; Polity Report, The Merina of Madagascar, from CIDCM; Library of Congress Country Study; World History Archives, Hartford University.

Photos: Madagascar is huge and picturesque; it's still home to an astonishing array of frogs, monkeys, chameleons, and plants. Photos of these are readily available [* *]. Here are some pictures of Antananarivo and other urban areas. While we're at it, here's where to find maps of the country (UT)

Human Rights: Amnesty International country listing; Human Rights Watch;

News: Relief Web; Independent Online, ZA;