IMPACTS OF THE CRISIS IN MADAGASCAR AND ON SAF/FJKM
Document for partners and friends of SAF, June 2009
BACKGROUND
Many sectors are affected : air transport, craft workers, agriculture, tourism……
At the moment many consequences of the crisis are unknown and studies of the impacts are still under way.
SAF/FJKM is also faced with the consequences of this crisis as a result of the abrupt ending of a number of development programmes and the suspension of funds.
This document will give an indication of the effects of the crisis in the social, economic and humanitarian domains in order to alert SAF’s partners to the need for some urgent financial support because its activities risk being severely compromised. The vision of SAF is to be a confident, professional and credible partner in Madagascar’s development. At the present time this means particular sensitivity to the ills that are affecting the poorest and most vulnerable in society. SAF expects to mobilise its energies towards actions that will repair the damage caused by this crisis in the most effective social and economic way.
Civil society organisations such as SAF/FJKM are all the more needed when the state fails as is now the case. And even if there is an effective return to constitutional government, the poorest in society will doubtless need a long period of the particular help that NGOs can give before their standard of living returns to where it was before this crisis. It is worth noting that SAF/FJKM is the largest Development NGO in Madagascar (in scope and range of interventions) because SAF Units are found almost everywhere on the island and SAF work can reach the most remote corners of the country.
i Social and Humanitarian IMPACTs OF THE CRISIS
The majority of the Malagasy population, living on less than a dollar a day, has been seriously affected by the recent political crisis that has rocked the country. Unfortunately this political crisis has turned into a social crisis which has further complicated the lives of the majority who were already classed as “vulnerable”.
The crisis shows itself in various ways : an economy at death’s door, linked to the closure of businesses and lay-offs; a situation which makes managing family finance more and more difficult and leads to lower consumption and food insecurity; inability of parents to pay school fees, rent, water and electricity bills …….
The rise in crime levels causes grave concern to households, commercial enterprises and overseas visitors. Also, a great social tension, threats of strikes and disputes are often heard in public sector organisations following the replacement of executive officers.
For children the impacts are alarming (source : UNICEF).
- 15 children have disappeared since the start of the crisis and others have run away as a result of an increase of violence within families,
- Nearly 250,000 children aged under five live in three regions affected by food insecurity in the south of the country and are at risk of malnutrition,
- 116,000 children have been unable to go to school during the worst of the crisis,
- The interruption of water and sanitation services in key localities has put 100,000 children in danger of water-borne diseases,
- The recent levels of unusual violence has provoked a high level of stress among children and young people who have practically no access to psychiatric support.
“Given the already high level of chronic vulnerability among Malagasy families, we are deeply concerned by the consequences of these various crises to children,” said M Bruno Maes, the UNICEF representative in Madagascar. Add to that the fact the most vulnerable families are quite simply, in the present circumstances, incapable of providing sufficient food, clean water or care for their children.
The situation badly affects children’s education due to school closures, high levels of absenteeism and direct threats against schools and pupils. Even in schools that are not directly affected by the violence, a general mood of fear is current among pupils, parents and teachers.
Public health is also of serious concern.
About 700,000 people, including 100,000 children aged under five, have been affected by the interruption to water and sewerage services.
Hospitals have registered a sharp increase in admissions of children with severe breathing difficulties due to the use of tear gas during the worst of the crisis.
Since the beginning of the crisis, the municipal waste-collection service in Tananarive and other urban areas has been scarcely functioning, with a consequent risk of disease.
We have also noticed that health services no longer meet the needs of the population and that the poorest sections of society are the most vulnerable. The crisis is likely to get worse because the social security safety net, a structure which is largely lacking in Madagascar, is at risk for public servants according to Midi Madagascar dated 11th June 2009, “Cancellation of health insurance at ministry level”.
The economic impact of the crisis on the chances of finding part-time jobs for the most vulnerable means that many families can no longer afford to buy drinking water or food for their children,
M Luciano Tuseo, the World Health Organisation’s representative responsible for the fight against malaria in Madagascar, said that the crisis has had a significant impact on access to health care, particularly in rural areas, and “this situation risks accelerating the spread of disease in the short and medium term.”
Although food supplies should be adequate for the most part, the south of Madagascar is in danger. The region, often affected by drought, has had very little rain at all this year. A serious food crisis is expected from September 2009.
The appeal sent out by humanitarian organisations in Madagascar suggests that the combined crises (political and natural) have pushed the number of those needing humanitarian aid to 2.5 millions, essentially in urban areas.
According to that appeal document, the political situation “has drastically disrupted fundamental social services, generated a climate of fear and uncertainty and caused delays or interruptions to a number of development and aid projects the length and breadth of the country.”
Press reports
“Disappearance of children in Tana : 15 more reported missing. The great majority of these missing children have run away. The most common reason for their flight is abuse at home of which they are victims.”
Midi Madagascar 23/04/09
“Malagasy crisis : concern shown by the international community at the plight of children. The rights of the child should be respected in their entirety and in all circumstances.”
Midi Madagascar 04/04/09
“ Many rents unpaid, households in difficulty. Tenants of medium and bottom-of-the-scale properties are having increasing difficulty in paying their rents. These are usually households of medium to low income where the mother has lost her job as a result of the crisis and the father’s income alone is insufficient.”
Midi Madagascar 14/05/09
“Pork and beef consumption in decline. People are no longer buying as much as before. Many customers have disappeared and even the most faithful customers are reducing the amount that they buy. They are no longer buying by weight but according to the money they have available.”
Midi Madagascar 12/05/09
“Low Season2009. High risk of food shortages. The director of a fertiliser factory wishes to alert the Malagasy authorities and outside funding agencies that urgent action is needed to avert a food crisis. He fears that there will be serious food shortages in the next low season (the period before the main rice harvest T.H.). Unlike last year, the state is not putting aside any funds with which to subsidise low season crops.”
La Gazette 14/05/09
“Food shortages. Madagascar on the brink of disaster. The Organisation of Environmental Conception and Integrated Development, an organisation working on development projects in Madagascar, has appealed to the World Bank for an urgent intervention to prevent a humanitarian disaster in the country.”
La Gazette 12/05/09
“Androy and Anosy. Badly affected by malnutrition. Research undertaken by UNICEF and The World Food Programme shows that the rate of severe malnutrition in the population has risen above 10%.”
La Gazette 09/05/09
“Big delays in payment of school fees since February. Many private schools in the capital have noticed big delays in payment of fees since the crisis began. In most cases payment is three-months behind. Almost half of parents are having difficulty paying the monthly fees.”
Midi Madagascar 06/05/09
“Tananarive Education District : the appointment of a new director is disputed by employees. Employees have made their discontent known following the appointment of a new director whose competence is not in the field of education. He is a specialist in a completely different field, very far from education. A strike is under consideration.”
Midi Madagascar 07/05/09
“Befeletanana Hospital Complex : personnel scandalised by the method of appointment of the new director. The decision of the Transitional Authority to put an ordinary doctor at the head of the hospital complex and not an incumbent professor has appalled the hospital staff. The day after the decision the staff and various associations sent a letter (of protest?) to the authorities. They have since taken the initiative and anticipated the moment of handover by organising a ‘sit-in’ in the courtyard at the main entrance to the hospital.”
Midi Madagascar 10/04/09
“Economic sector demands security. Too much insecurity and crime in all its forms. Those working in the economic sector demand security and peace in order to start up their activities again. Among others one could mention micro-finance, the University Hospital complex, agribusiness, tourism and services. Those interviewed preferred to remain anonymous for fear of reprisals.”
Midi Madagascar 04/04/09
“Ten people in military uniform rob a Chinese man. At 7am on 14th April, ten individuals in military uniform entered the quarry being worked by a Chinese enterprise involved in public works. They forced a Chinese workman to give them all the money that he had on him, together with other objects of value.”
Midi Madagascar 15/04/09
“Urban terrorism in Tananarive : one dead, 34 wounded and 28 arrests.”
Midi Madagascar 24/04/09
“Kidnapping in Majunga. Has a 5 milliard ransom been paid? A kidnapping took place in Majunga. The kidnappers demanded the tidy sum of 5 milliard Malagasy francs. Theories abounded at the scene. Three days later the victim reappeared safe and well. Did the wealthy family give in to ransom demands?”
La Gazette 27/05/09
“Transition. Looting of Ministries. Petrol vouchers continue to be distributed in certain departments despite the ban issued by the new Minister of Finance. IT equipment has disappeared. Engines have been removed from vehicles. Practically no office equipment remains.”
La Gazette 25/05/09
“Route Nationale 7. Death of a dental surgeon. Serious rise in insecurity. For some time there has been an increasing number of armed attacks in the capital. In one week four such incidents have been the topic of conversation. Guns such as kalashnikovs are freely available and are used in disputes that are often bloody. There is even whisper of a network of arms suppliers who rent guns to criminals.”
La Gazette 13/05/09
“Mahajanga. Rampant poverty and insecurity. Many proprietors of restaurants, bars and hotels complain about the security situation in central Mahajanga – an insidious insecurity that comes from the presence of large numbers of people squatting on the pavements who beg, steal, shout and swear and use the pavement as a toilet.”
“Mananara Nord. Consumer Price Index building burgled.”
La Gazette 02/06/09
“French residents in Madagascar. 60 families fall victim to looting at the height of the crisis.”
La Gazette 16/06/09
“Leader Price. Bomb attack! A home-made bomb exploded in Leader Price (a large supermarket T.H.) during the evening of 15th June.”
L’Express de Madagascar 26/05/09
“Andoharanofotsy : a shopkeeper threatened in broad daylight. Five armed individuals threatened the shopkeeper when she was on her way back to the capital.”
L’Express de Madagascar 25/05/09
“Ambohibary Antanimena : 200 million Ariary were stolen from the house of the manager of DM International Company at Ankazomanga.”
L’Express de Madagascar 20/05/09
“Andohatapenaka. Three armed men, wearing police badges, stole a Volkswagen. Foreign currency was found in the boot.
L’Express de Madagascar 19/05/09
“Analamahitsy. 100 million Ariary stolen in bank hold-up.
L’Express de Madagascar 18/05/09
“Taxi thief wounded by a bullet. A group of young robbers held up taxis in Ambohimanarina. One was wounded by a bullet.”
L’Express de Madagascar 15/05/09
“Wholesale merchant wounded in hold-up. Thieves opened fire on a wholesale merchant during a robbery. Their haul is estimated to be 15 million Ariary.”
L’Express de Madagascar 02/06/09
“Molotov cocktails thrown in Fort Duchesne.”
“French dairy producer shot dead by criminals.”
L’Express de Madagascar 03/06/09
“Confrontation between the army and the fokonolona following the requisition of the headquarters building belonging to a company in Ampasampito.”
L’Express de Madagascar 19/06/09
“ A home-made bomb attack, aimed at the forces of law and order, was prevented at the very last minute in Ankorondrano.”
“Five armed men attacked a villa at Amboanjobe belonging to a foreign national. His wife was threatened and robbed of a million ariary in cash and gold jewellery weighing nearly a kilo…”
L’Express de Madagascar 17/06/09
“Gunshots terrify (the inhabitants of) Antanetibe Ambohidrapeto. At about 1am armed men attacked the home of a charcoal seller. He was killed by two bullets in his back.
L’Express de Madagascar 16/06/09
“Explosion in a large area. Tanjombato was shaken by a terrifying event yesterday evening. A home-made bomb exploded in Leader Price.
L’Express de Madagascar 16/06/09
“Robbers circulating in broad daylight at Ambohimarina. At about 11am five masked men brandishing sabres and a pistol burst in to a wholesale merchant’s property.”
II IMPACT OF THE CRISIS ON THE MALAGASY ECONOMY
Many sectors are affected:
The Malagasy economy is dead at the moment. All sectors have seen their income drop and their activities slowing to a standstill.
In 2006 economic growth in Madagascar was 4.9%, increasing to 6.5% in 2007 and 7.5%in 2008. For the current year, economic growth is predicted to be negative.
We present here a few cases of difficulty in various sectors:
Hotels are registering an occupation rate of 10 – 15% although the high season is approaching. They have had to lay-off 70% of their employees. The closure of 70% of hotels adds another 70% to business losses in this sector.
(Source : National Tourism Office)
Tourism is badly affected by the crisis despite an appeal to foreign governments to lift their ban on travel to Madagascar. Foreign currency income has dropped sharply because one must not forget that it is tourism that brings the most foreign currency into the country.
According to statistics published by the Air & Frontier Police and the Ministry of crafts and Tourism, there has been a drop of 42% in arrivals of non-residents in Madagascar during the first quarter of 2009 compared to the same period in 2008, whereas tourism had shown an increase of more than 12% between the first quarter of 2007 and the same period in 2008.
Between January and March 2007 60,611 non-residents entered the country. There were 68,162 in 2008 and only 39,483 in 2009.
Ecotourism has also been badly affected. Since this crisis began numbers of those visiting National Parks has dropped by 55.59% compared to 2008 – 4,874 fewer visitors between January and April 2009. As far as income goes, The Inter-Regional Directorate in Fianarantsoa has reported a drop of 121,601,100Ar compared to the same period in 2008.
Airlines have seen a drop of 40% in business. M. Jean François Richard, Director General of Air France has stated that due to a drop in reservations for flights between France and Madagascar Air France will only be running three flights a week instead of the usual four until next October – and this during what is normally the high season.
Cement : as a consequence of the present crisis, cement works are not working to full capacity. Maloci, a large Malagasy cement factory has temporarily ceased production. Its usual capacity is 1,000 tons per day but they are unable to stock any more because of the drop in demand.
Publicity & Communication was, until the crisis, an expanding sector of the economy but starting it up again is very difficult because of the estimated drop of 80% in business income. Businesses are reducing their communication and publicity budgets because they are in financial difficulty themselves or were victims of looting and vandalism. This sector is totally dependent on the health of the wider economy.
CNAPS (Social Security) : Many firms are no longer able to pay their contributions.
Depreciation of the currency and inflation
Economists should have predicted a depreciation of the Ariary, but what is astonishing is the speed with which this has happened. The way things are going on the International Money Market is not helping our national currency.
This meteoric drop in the value of the Ariary is not without consequences for the price of consumer goods. The National Institute of Statistics, in its periodic check on the consumer price index, has suggested that the inflationary tendency is likely to continue with an increase of 0,2% in May and 0.5% in June.
Price increases affect all products whatever their origin, but is most noticeable for goods that use imported materials in their manufacture, which show an increase of 0.7%. There was a noticeable increase in cottage industry between February and March 2009.
The cost of Products of Primary Necessity, or PPN, increased by 0.7% in March. The price of imported sugar has risen by more than 21% in the space of a few weeks, and that of imported flour has risen by 28%.
The Holcim cement company is putting up its prices by 7.5% for a number of reasons, according to its Director. Firstly the depreciation of the Ariary which has lost 25% of its value relative to the dollar – which is the currency that Holcim uses to import its raw materials. Anthracite, used in the manufacture of cement, has increased in price since last year and last but not least, the cost of electricity has gone up since November.