Based on the average exchange rate for 2020, the Malagasy ariary depreciated by -19.2% against the US dollar since 2016 and declined by -4.7% from 2019 to 2020. Madagascar’s weaker local currency makes its exports paid for in stronger US dollars relatively less expensive for international buyers.
The latest available country-specific data shows that 85% of products exported from Madagascar were bought by importers in: France (23.1% of the global total), United States (22.3%), Germany (8.2%), China (6%), Netherlands (4.4%), India (4%), United Arab Emirates (4%), Canada (3.2%), Japan (3.2%), South Africa (3%), South Korea (1.9%) and Spain (1.7%).
From a continental perspective, 43.3% of Madagascar’s exports by value were delivered to European countries while 25.6% were sold to North American importers. Madagascar shipped another 24.1% worth of goods to Asia. Smaller percentages went to Africa (6.6%), Oceania led by Australia (0.3%) then Latin America excluding Mexico but including the Caribbean (0.2%).
Given Madagascar’s population of 27.6 million people, its total $1.9 billion in 2020 exports translates to roughly $70 for every resident in the East African island.
Madagascar’s Top 10 Exports
The following export product groups represent the highest dollar value in Malagasy global shipments during 2020 at the 2-digit Harmonized Tariff System (HTS) code level. Also shown is the percentage share each export category represents in terms of overall exports from Madagascar.
- Coffee, tea, spices: US$592.7 million (30.6% of total exports)
- Clothing, accessories (not knit or crochet): $205.9 million (10.6%)
- Knit or crochet clothing, accessories: $183.9 million (9.5%)
- Nickel: $149.5 million (7.7%)
- Ores, slag, ash: $122.7 million (6.3%)
- Fish: $111.6 million (5.8%)
- Gems, precious metals: $96.6 million (5%)
- Perfumes, cosmetics: $69.8 million (3.6%)
- Vegetable/fruit/nut preparations: $37.9 million (2%)
- Other base metals: $33.7 million (1.7%)
Madagascar’s top 10 exports accounted for 82.8% of the overall value of its global shipments.
Perfumes and cosmetics increased by 15.4% from 2019 to 2020. The only other top product category to increase was vegetable, fruit or nut preparations which rose 11.4%.
The leading decliner among Madagascar’s top 10 export categories was miscellaneous base metals which fell -67.3% year over year.
Drilling down to the more detailed 4-digit HTS codes, Madagascar’s most valuable exported goods are the spice vanilla (26.3% of total), unwrought nickel (7.5%), knitted or crocheted jerseys (5.2%), crustaceans including lobsters (5%), titanium ores and concentrates (4.6%), unknitted or non-crocheted men’s suits and trousers (up 4.1%), gold (3.6%) and essential oils (also 3.6%).
The following types of Malagasy product shipments represent positive net exports or a trade balance surplus. Investopedia defines net exports as the value of a country’s total exports minus the value of its total imports.
In a nutshell, net exports represent the amount by which foreign spending on a home country’s goods or services exceeds or lags the home country’s spending on foreign goods or services.
- Coffee, tea, spices: US$591.7 million (Down by -10.4% since 2019)
- Clothing, accessories (not knit or crochet): $177 million (Down by -20.5%)
- Knit or crochet clothing, accessories: $174.5 million (Down by -14.7%)
- Nickel: $148.7 million (Down by -67%)
- Ores, slag, ash: $122.5 million (Down by -5.7%)
- Fish: $97.9 million (Up by 11.8%)
- Gems, precious metals: $96.4 million (Down by -17.5%)
- Perfumes, cosmetics: $52.7 million (Up by 56.6%)
- Other base metals: $33.2 million (Down by -67.5%)
- Gums, resins, other vegetable saps: $32.9 million (Down by -7.8%)
Madagascar has highly positive net exports in the international trade of coffee and spices (particularly vanilla). These surplus cashflows indicate Madagascar’s strong competitive advantages under the coffee and spices category.
Overall Madagascar incurred a -$1.28 billion trade deficit for 2020, declining by -3.9% from the -$1.33 billion in red ink during 2019.
Below are exports from Madagascar that result in negative net exports or product trade balance deficits. These negative net exports reveal product categories where foreign spending on home country Madagascar’s goods trail Malagasy importer spending on foreign products.
- Mineral fuels including oil: -US$387.3 million (Down by -38.6% since 2019)
- Machinery including computers: -$250.5 million (Down by -10.1%)
- Cereals: -$204.7 million (Up by 24.6%)
- Vehicles: -$186 million (Down by -33.7%)
- Electrical machinery, equipment: -$157.9 million (Down by -11.5%)
- Animal/vegetable fats, oils, waxes: -$148 million (Up by 28.6%)
- Pharmaceuticals: -$139.8 million (Down by -4.3%)
- Plastics, plastic articles: -$109 million (Down by -16.6%)
- Cotton: -$92.5 million (Down by -7.4%)
- Wool: -$80.2 million (Down by -19.9%)
Madagascar has highly negative net exports and therefore deep international trade deficits for mineral fuels-related products, notably refined petroleum oils.
Malagasy Export Companies
Not one Malagasy corporation ranks among the Forbes Global 2000.
Wikipedia lists companies based in Madagascar. Selected examples are shown below.
- Air Madagascar (international/domestic airliner)
- Karenjy (automobiles)
- Madacom (telecommunications, internet services)
- Madagascar Oil (oil, gas)
- Madarail (national railways)
In macroeconomic terms, Madagascar’s total exported goods represent 4.3% of its overall Gross Domestic Product for 2020 (an estimated $44.8 billion valued in Purchasing Power Parity US dollars). That 4.3% for exports to overall GDP in PPP for 2020 compares to 5.6% for 2019. Those percentages seem to indicate a relatively decreasing reliance on products sold on international markets for Madagascar’s total economic performance albeit based on a short timeframe.
Another key indicator of a country’s economic performance is its unemployment rate. Madagascar’s unemployment rate was an average 1.9% for 2020, up from 1.7% in 2019 according to Trading Economics.
Madagascar’s capital city is Antananarivo.
See also Top African Export Countries, Madagascar’s Top 10 Imports and Seychelles Top 10 Exports
Central Intelligence Agency, The World Factbook: Country Profiles. Accessed on March 8, 2021
International Monetary Fund, Exchange Rates selected indicators (National Currency per U.S. dollar, period average). Accessed on March 8, 2021
International Monetary Fund, World Economic Outlook Database (GDP based on Purchasing Power Parity). Accessed on July 4, 2020
Investopedia, Net Exports Definition. Accessed on March 8, 2021
International Trade Centre, Trade Map. Accessed on March 8, 2021
Wikipedia, Gross domestic product. Accessed on March 8, 2021
Wikipedia, List of Companies of Madagascar. Accessed on March 8, 2021
Wikipedia, Madagascar. Accessed on March 8, 2021
Wikipedia, Purchasing power parity. Accessed on March 8, 2021