Madagascar is defending its decision to freeze fuel prices. The Great Island must still explain to the International Monetary Fund (IMF) the reasons behind its suspension of the automatic fuel price adjustment mechanism, a mechanism that was part of the commitments made under the Extended Credit Facility (ECF) and the Resilience and Sustainability Facility (RSF) programs. Meanwhile, Madagascar’s file, which was scheduled to be reviewed by the IMF Executive Board in mid-July following the third and fourth reviews of the ECF and RSF programs, has not yet been placed on the agenda. Consequently, the disbursement of 134.4 million Special Drawing Rights (SDR) has been delayed.
“Madagascar has already met almost all the criteria agreed upon with the IMF, particularly the institutional benchmarks, with only three remaining to be finalized. The main sticking point concerns the reform of the fuel price policy,” explained the Minister of Economy and Finance, Herinjatovo Ramiarison, this Wednesday on the sidelines of the monetary policy decision presentation organized by the Banky foiben’i Madagasikara (Central Bank of Madagascar). The government believes that the current economic context does not allow for the implementation of the automatic fuel price adjustment mechanism at the pump. Authorities fear that an increase in fuel prices would fuel a new generalized rise in prices.
In the discussions, the IMF wants to ensure that the fuel price freeze does not compromise public finance sustainability objectives. The Malagasy authorities will therefore have to convince their partners that they have other levers to maintain budgetary balances without causing social tensions. Negotiations are ongoing ahead of the next IMF Executive Board meeting, scheduled for the end of August. The outcome will determine not only the disbursement of the expected 183 million dollars but also the continuation of the financial partnership between Madagascar and the Bretton Woods institution.
Captured & Published at: 2026-08-05 18:23:41 (Madagascar Local Time EAT)
Original Source: https://2424.mg/programme-fec-frd-madagascar-doit-convaincre-le-fmi-du-bien-fonde-de-sa-decision-de-geler-les-prix-des-carburants/?utm_source=rss&utm_medium=rss&utm_campaign=programme-fec-frd-madagascar-doit-convaincre-le-fmi-du-bien-fonde-de-sa-decision-de-geler-les-prix-des-carburants
