US pleased with economic progress

Impressed by Madagascar's macroeconomic performance over the past year, the United States this week cancelled part of the country's debts totalling 27 billion Malagasy francs (about US $4.5 million). "Firstly, we have been pleased with ongoing efforts by the government to curb corruption. The United States is also particularly impressed with the country's rapid economic recovery following the 2002 political crisis. Based on these two factors and the government's commitment to tackling poverty, we decided to cancel some of the debt," the US public affairs officer in Madagascar, Paul Cunningham, told IRIN. In 2002 a protracted dispute over the presidency almost crippled an already fragile economy. Although economists at the time predicted it would take time for the country to bounce back, the economy grew at an unprecedented 9.6 percent in 2003. Much of the economic turnaround has been attributed to the government's courtship of international investors and guarantees to stem graft. In an attempt to curtail government corruption, President Marc Ravalomanana announced pay increases for ministers and civil servants soon after he took power in 2002. Donors have also welcomed the government's commitment to reducing widespread poverty. The World Bank recently gave the go-ahead to the country's poverty reduction strategy and approved a credit of US $30 million to support reforms in the public sector. Cunnigham said: "The government's focus on building critical infrastructure indicates a serious commitment to alleviating poverty. Adequate roads and other transport links are central to the free movement of goods and services." Some 75 percent of Madagascar's population is considered poor, with the urban households facing a daily struggle to make ends meet.