Madagascar: Buying and Selling

Market Access Procedures

International Conventions: Member of the World Trade Organization (WTO)
Party to the Kyoto Protocol
Party to the Washington Convention on International Trade in Endangered Species of Wild Fauna and Flora
Party to the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal
Party to the Montreal Protocol on Substances That Deplete the Ozone Layer
Party to the International Coffee Agreement
International Economic Cooperation: Madagascar is a member of the WTO, the Common Market for Eastern and Southern Africa (COMESA), and the South African Development Community (SADC)
Non Tariff Barriers: Madagascar does not have significant formal non-tariff barriers to trade. As of 2018 Madagascar had 11 non-tariff measures in force (WTO). However, such measures do not impact Madagascar’s foreign trade consistently according to the US Market Intelligence Unit.
According to the 2018 World Bank Logistics Performance Index - which measures countries’ trade logistics efficiency - Madagascar was ranked 128th out of 160 countries.
Customs Duties and Taxes on Imports: Tariffs and duty rates are constantly revised and are subject to change without notice. Although they have been lowered recently, tax and customs duty rates are still relatively high, ranging from 5% to 20% on CIF value of goods. According to data by the World Bank, the Most Favoured Nation (MFN) weighted average tariff for Madagascar is 8.90%.
Some capital goods and products used for further processing from sectors in agricultural and textile, as well as those associated in health security, renewable energy, and sports equipment are exempt from customs duties.
You can consult the applied tariffs on the Malagasy Customs website.

Customs Classification

Madagascar is a member of the World Customs Organisation and does comply with the harmonised customs system.

Import Procedures

The following documents are required to import goods in Madagascar:

bordereau de suivi des cargaisons (BSC) (cargo tracking note). The BCS needs to be electronically submitted either by the exporter or forwarding agent before the goods have been shipped.
commercial invoice
bill of lading/airway bill
packing list
certificate of origin
original and copy of the certificate of tax registration for the first operation
certificate of insurance
according to the category of goods or services being brought into the country, further authorisations from supervising departments might be requested.

All perishable foods must be labelled in French or English before the sale of the product, with the following information:

origin of the product
sell-by or use-by date
list of ingredients
recommended storage method
name and registration number (as applicable) of the manufacturer
intended use of the product (as applicable).

Importing Samples

Since 2013, Madagascar adopted the ATA Carnet System, which enables companies to move goods and samples in or out of the country for up to a year without paying duties or taxes.

For Further Information: Madagascar Customs
Business Portal for Africa
Ministry of Commerce

Reaching the Consumers

Marketing opportunities

Consumer Profile: Madagascar has a population of around 27.58 million people, with a GDP per capita (PPP) estimated at USD 1,640 by the IMF (2021), one of the lowest in the world. The country is classified as low-income by the World Bank, with 75% of the population living on less than USD 1.90 per day in 2019 (latest data available). The country’s human capital index (0.39 in 2020 - World Bank) is also one of the lowest worldwide and it has the world’s fifth-highest rate of chronic malnutrition, with 47% of children under five years suffering from stunting (UNICEF, 2021). Men earn significantly higher wages and business profits than women. Income inequality levels are not too evident in the country.
The Malagasy consumers are relatively young: according to data by the CIA, the proportion of children below the age of 14 is 38.86%, 20.06% of the population is between 15 and 24, 33.02% between 25 and 54, while only 8.07% are 55 or older; and it is equally split between men and women (2020 est.).
Most of the population lives on the eastern half of the island, on the central highlands and the eastern coastline. The urban population was only 38.5% of the total in 2020 (CIA World Factbook), although the country has seen a process of urbanization in recent years. In 2019, the rate of access to electricity was just 15%, one of the lowest in the world (World Bank, latest data available).
Classic credit has not developed much among the Malagasy population. However, micro-credit is used by a large number of farmers or small business owners. It was developed in the 1990s in Madagascar and it continues to progress. For more information, visit the site of Micro-finance in Madagascar.

Consumer Behaviour

For Malagasy consumers, brand loyalty is the most important purchase driver and loyalty levels are much higher in Madagascar than in other Sub-Saharan countries. Affordability is the second most important purchase driver, while low prices or deals may encourage trial. Proximity and availability are also very important.
Generally, Malagasies have a limited budget, thus food and grocery purchases account for almost 40% of monthly household spending (also considering that many people are active in subsistence farming). The majority of people, around 75%, still shops at kiosks (according to the latest data available from a Nielsen survey).
The majority of Malagasies are very family-oriented and many live in a joint family. A family-driven communication can thus be effective in this market (also considering that a woman’s opinion is very important in household matters).
TV and radio are the most popular sources of information and entertainment, thus companies should focus on these means for their advertisement (reaching around 90% of the potential consumers - latest survey from Mediatrie). On the other hand, newer forms of advertising (like social media) would have a lower impact, as internet access in the country is still limited.

Main Advertising Agencies

Distributing a Product

Evolution of the Sector

According to a 2018 report by Kantar TNS, the retail sector accounts for 44% of the Malagasy market. In fact, consumers in Madagascar still prefer to shop from small local stores, which reach a penetration level of 97% (people shopping there at least once every month). Traditional market places have a much lower penetration rate (around 20% - the main names being Analakely, Isotry, Anosibe and Andravoahangy).
Proximity is the most important purchasing factor for Malagasy consumers, together with prices. The big supermarket chains generally apply a higher commercial margin with respect to developed countries as a result of the lower economies of scale and competition. The main chains are French (Score, Leader Price, Supermaki), South African (Shoprite), Chinese (Horizon Ivato/Sogecoa), and Mauritian (Courts).
In the future, supermarkets are expected to keep growing, increasing their proximity level with the opening of new outlets, and thus their market share.

Market share

Although there are no exact figures about retail market share, the main supermarket chains in Madagascar include:

Leader Price
Carrefour (Jumbo & Score Supermarkets)
Shoprite
Shop Liantsoa
Supermaki (belongs to the Jumbo & Score group)

Retail Sector Organisations

Groupement des Entreprises de Madagascar (GEM)

E-commerce

Internet access: According to the Digital 2019 report for Madagascar by Hootsuite and WeAreSocial, out of a population of 26.6 million people, only 9.8% have access to the internet.
In the country there are around 8.3 million mobile subscriptions (but only 2.3 million have an internet mobile subscription) and 9% of the population are active social media users. Furthermore, 2.1 million people are active mobile social media users. The vast majority of mobile connections are pre-paid (only 3% are post-paid).
The social media advertising audience is equal to 2.4 million for Facebook, with much lower figures for other platforms (180,000 for LinkedIn, 54,000 for Instagram and 12,400 for Twitter).
According to the Mobile Connectivity Index 2018, Madagascar has an overall index score of 33 out of a maximum of 100 (in particular, the IT infrastructure network has a score of 24.7/100, and the affordability of internet connections has a rate of 35.3/100).
There are generally no restrictions on access to the internet in the country.
The most popular web search engines in Madagascar are Google (95%), Yahoo and Bing (3.2% and 1.4%, respectively).
E-commerce market: E-commerce in Madagascar is still limited. Though there are no official figures about the market size, according to a survey by Styleex (2018), 65% of Malagasy consumer has never purchased on the internet, with the majority of transactions being carried on through Facebook. This is also due to the fact that a mere 1% of the population has a credit card and only 12% have a mobile money account (data Digital 2019).
The vast majority of goods sold through the internet are clothes and hi-tech products (86%). Payments are generally made through cash-on-delivery.
The main factors hindering the development of e-commerce are the poor IT infrastructures, the lack of familiarity with online payment methods, and a weak legal framework. In fact, although in 2014 Madagascar adopted laws on aspects such as electronic transactions, cybercrime, and privacy and data protection, the regulations to effectively enforce the legislation has yet to be put in place.
According to UNCTAD's 2018 Business-to-Consumer E-commerce Index, Madagascar ranks 27th out of 44 countries in Africa, and 129th out of the 151 countries in the whole world.
The top e-commerce retailer in Madagascar is currently Exeia, who sells electronics, appliances, home decoration, cosmetics, fashion and sportswear.
Facebook is by far the most popular social network (with an estimated 2.4 million users), and its marketplace the most common e-commerce resource of the country.

Organizing Goods Transport

Main Useful Means of Transport: Considering the poor condition of the roads and the poor development of railroads, the best way of transporting merchandises is by ship around the coasts of Madagascar. The country is the third largest island in the world and has 17 ports, the main one is Toamasina, followed by Mahajanga, Toliary and Antsiranana. The other ones are ports of coastal navigation.

The main port and the secondary ports are connected by the national roads. In spite of the poor condition of the highways, the merchandise is transported in trucks.
Ports: Port of Toamasina
List of ports in Madagascar
Airports: ADEMA: site of airports in Madagascar
Ivato International Airport (TNR) in Antananarivo
Sea Transport Organisations: Port, Sea and River Agency (Agence Portuaire Maritime et Fluviale)
Air Transport Organisations: Ministry of Transport
Road Transport Organisations: Road Authority of Madagascar (Autorité Routière de Madagascar - ARM)
Rail Transport Organisations: Ministry of Transport

Identifying a Supplier

Type of Production: According to data by the World Bank, the agricultural sector accounts for an estimated 20% of Madagascar’s GDP, employing around 68% of the workforce. The main crops are rice, cassava and vanilla.
Industry contributes 22.6% of the country's GDP and around 7% of total employment, mainly in the mining, textile and agro-processing sectors.
The services sector accounts 44.1% of GDP, giving employment to nearly 24% of the workforce.

Business Directories

Multi-sector Directories: Afrikta - List Of Companies In Madagascar
Annuaire - Madagascar business portal
Expat.com - Madagascar business directory
Les Professionnels de Madagascar - Online business directory in Madagascar
ListCompany - List of companies in Madagascar
Mada YP - Madagascar's business directory
MyAllDay - Madagascar business directory
Yellow Pages Madagascar - Directory of businesses and professionals in Madagascar

To search directories by industry in Madagascar, check out our service Business Directories.

Professional Associations by Sector: 12 professional associations listed for Madagascar.

Trade Agencies and Their Representations Abroad: Economic Development Board of Madagascar (EDBM)
Chamber of Commerce and Industry France Madagascar
Contact Your Commercial Representations in Madagascar: Mauritian Embassy in Madagascar
Villa David IV
Manakambahiny
Antananarivo-101
Madagascar
Tel: (261-20) 22 321 57
Fax: (261-20) 22 219 39
Contact the Embassy per Email.
General Professional Associations: Groupement des Entreprises de Madagascar (GEM)
Syndicate of Industries of Madagascar (SIM)

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