Donors pledge financial aid for economic recovery

International donors this week granted Madagascar close to US $600 million in aid to help rebuild the island's battered economy.

In a sign of support for the new government's plans to fight poverty and improve governance, the EU on Thursday granted Madagascar $572 million over five years, the local newspaper, L'Express, reported.

The US Agency for International Development (USAID) on Friday also pledged $1.6 million to boost the country's private sector.

USAID acting director general Stephen Haykin told IRIN that the funding would be used to improve "communication" between the government and civil society.

He added that the grant was part of $16 million earmarked by the US for the Malagasy private sector.

The funding marked the lifting of a freeze on financial assistance to the country, imposed following a disputed presidential election in December. The EU was one of the first members of the international community to recognise the presidency of Marc Ravalomanana.

EC President Romani Prodi visited Madagascar this week. L'Express quoted him as saying his visit was "a strong signal of international solidarity to underline the end of the political crisis in the country".

Prodi's comments followed the UN's tacit recognition of Ravalomanana's government at the Earth Summit in Johannesburg, South Africa.

Ravalomanana faces a major challenge in rebuilding an economy left in tatters by seven months of conflict with supporters of former president, Didier Ratsiraka.