Madagascar World Bank Involvement:

Madagascar World Bank Involvement:

IDA has supported mining sector reform in Madagascar through a series of technical assistance projects since 1998, with emphasis on attracting investment, improving the sector’s environmental performance, and ensuring that the sector’s benefits are widespread. The reforms fostered a large increase in activity, including the development of large mining operations in ilmenite and nickel/cobalt. Given the country’s widespread poverty, the government undertook a strategy centered on strengthening local governance, decentralizing fiscal revenues, and providing technical assistance to community associations and municipal governments for the integration of mineral resources management in their development plans.

Two investment agreements totaling US$5.5 billion were signed in the mining sector in 2005-06. Approximately 12,000 domestic jobs were created during construction of the two mines.The ilmenite mine opened in 2009 and the nickel/cobalt mine opened in 2012 and, according to company reports, is positioned to become the world’s biggest lateritic nickel mine by 2014. Mine forestry committees have been established to assist with biodiversity and land use planning. Both mining companies have provided extensive short-term training and some long-term training for workers that will help provide local communities with a source of income beyond mine closure. Both companies have taken proactive stances in enabling local small and medium enterprises to take advantage of business opportunities arising during construction and exploitation. A multi-use port partially funded by the World Bank (US$32 million, 2006) was built near the ilmenite operation, while the nickel/cobalt operation did a major port upgrade. Both operations provide power to their local areas. An additional objective was to establish a foundation in connection with the ilmenite mine that would provide local communities with a source of income far beyond mine closure.