Madagascar Bets on Blue Economy to Turn Marine Wealth into Jobs, Investment and Resilience

Madagascar’s vast marine resources could drive jobs, investment and climate resilience, but weak implementation, financing gaps and infrastructure constraints are holding back their full economic potential. The report calls for stronger governance, community participation, sustainable fisheries and aquaculture, and innovative blue finance to turn natural wealth into inclusive, long-term growth.

Madagascar has more than 4,800 kilometres of coastline, around 270,000 hectares of mangroves and marine resources that support millions of dollars in economic activity. Yet much of this natural wealth remains underused as a source of sustainable jobs, investment and climate resilience. The World Bank report Blue Economy Development Challenges and Opportunities in Madagascar, initially prepared by Envirostrat and Resolve and subsequently revised by the World Bank team, draws on research and evidence from institutions including the Institute of Fisheries and Marine Sciences (IHSM), International Monetary Fund (IMF), Food and Agriculture Organization (FAO), BIOFIN and Blue Ventures. Its central message is straightforward: Madagascar has the resources for a strong blue economy, but better policies, stronger markets and more private investment are needed to turn those resources into lasting development.

The economic importance is already visible. Fisheries contribute more than 7% of Madagascar's GDP and around 7% of exports, while thousands of coastal households depend on fishing and marine resources for food and income. Mangroves provide breeding grounds for fish, shrimp and crabs, store carbon and protect coastal communities from storms and erosion. Protecting these ecosystems is therefore not only an environmental priority but also an economic one.

Strong Policies, but Implementation Remains the Missing Link

Madagascar already has a policy framework through its National Blue Economy Strategy 2023–2033, which promotes better governance, sustainable fisheries and tourism, infrastructure, resource development and climate resilience. Marine Spatial Planning and Integrated Coastal Zone Management could further help the government decide where fishing, aquaculture, tourism, conservation, and other activities should occur.

The problem is implementation. Regulatory uncertainty, limited institutional coordination, insufficient technical capacity and weak data increase risks for investors and communities.

Madagascar had 22 marine protected areas covering 14,451 square kilometres, alongside roughly 200 locally managed marine areas (LMMAs). One study cited in the report estimates that MPAs could generate as much as US$199 million annually. However, those benefits do not automatically reach coastal communities. Governments therefore need to combine conservation with secure resource rights, livelihood protection and transparent benefit-sharing.

The same challenge appears in fisheries. A seven-month closure of octopus fishing grounds around Andavadoaka increased the size and number of octopuses caught and helped support development of the approximately 1,000-square-kilometre Velondriake LMMA. But pressure on stocks continues. Lobster stocks in the Anosy region are also considered fully exploited, with assessments recommending around a 30% reduction in fishing effort.

Seaweed and Aquaculture Could Become New Engines of Jobs

Rather than simply increasing fish catches, Madagascar has an opportunity to create more value through aquaculture, processing, better quality and access to premium markets.

Sea-cucumber farming near Toliara offers one example. Commercial operations involve approximately 300 local fishers and 140 employees, with production of about seven tonnes, equivalent to around 3.5% of Madagascar's roughly 200 tonnes of sea-cucumber exports cited in the report.

Seaweed could offer an even larger opportunity. More than 3,000 households already benefit from seaweed farming, and approximately 40% of farmers are women. Tropical red seaweed can be harvested every 45–60 days and can supply industries producing food ingredients, animal feed, biostimulants and other products. New operators around Sainte Marie were estimated to represent 40–45% of national production.

Private investors, however, face risks from disease, pests, weak biosecurity and inadequate infrastructure. Madagascar needs stronger cold chains, processing facilities, quality standards and traceability systems. Clear licensing and environmental rules will also be essential to prevent aquaculture expansion from damaging the ecosystems on which the industry depends.

Development Finance Must Help Bring Private Capital In

International partners remain critical to Madagascar's blue economy. Over the decade covered by IMF data, 94 externally funded climate-related projects attracted commitments of about US$2.8 billion, while around US$991 million was disbursed.

The report suggests that development finance should increasingly be used to make projects attractive to private investors rather than supporting isolated projects indefinitely. Development partners could finance feasibility studies, environmental assessments, monitoring systems and technical assistance, while guarantees and concessional finance could reduce risks for commercial lenders.

A proposed Blue Investment Readiness Facility could help fisheries, seaweed, aquaculture, mangrove restoration and community-tourism projects become bankable. Smaller projects could also be grouped into larger portfolios capable of attracting banks and impact investors.

Blue carbon offers another opportunity, but it carries significant risks. Carbon projects require scientific baselines, monitoring, independent verification and commitments that can last 20–30 years. Madagascar should therefore explore several financing options, including blue bonds, blended finance, biodiversity credits, sustainability-linked loans, payments for ecosystem services and debt-for-nature swaps, rather than depending heavily on carbon credits.

From Marine Wealth to a Sustainable Investment Economy

The report points to a clear sequence for the future. In the short term, government should improve marine planning, clarify aquaculture regulations, strengthen community participation and build financial and technical skills. In the medium term, priorities should include natural-capital accounting, better fisheries data, traceability, cold-chain infrastructure and investment-readiness support. Over the longer term, successful fisheries, aquaculture and nature-based projects can be expanded using private capital, public-private partnerships and innovative blue-finance instruments.

For policymakers, the priority is creating predictable rules and protecting marine resources. For development partners, it is using public and concessional finance to reduce early investment risks. For private companies, opportunities are emerging in seaweed, aquaculture, sustainable fisheries, seafood processing, logistics, ecotourism and ecosystem services.

Madagascar does not lack blue-economy assets. With 4,800 kilometres of coastline, 270,000 hectares of mangroves, fisheries contributing more than 7% of GDP and thousands of households already participating in mariculture, the economic foundations are substantial. The challenge now is to build the policies, infrastructure and financing systems needed to transform this natural wealth into resilient businesses, better jobs and sustainable coastal development.