Economic Transformation for Inclusive Growth Project

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The development objective of the Economic Transformation for Inclusive Growth Project for Madagascar is to increase the growth of small and medium enterprises in target regions in Madagascar. The project comprises of five components. The first component, attracting and retaining private investment and removing key constraints to support economic recovery from the Corona virus disease 2019 (COVID-19) crisis objective is to support policy, administrative, and regulatory reforms and improvements that will facilitate investments and business operations in Madagascar. It consists of following sub-components: (i) provision of support to strengthen investment promotion to accelerate the economic recovery; and (ii) strengthening the business environment to contribute to economic recovery. The second component, removing constraints to private investment and enhancing local economic competitiveness to support recovery in target regions and target sector’s objective is to facilitate recovery from the COVID-19 pandemic in the regions and areas supported by the project and increase sector competitiveness for future resilience. It consists of following sub-components: (i) technical support to strengthen the competitiveness of value chains in the target regions; (ii) strengthening local infrastructure to support the growth of target sectors and business development; and (iii) strengthening local governance to support sectors growth and business development. The third component, supporting small and medium enterprise (SMEs) and entrepreneurship recovery and growth in target sectors and target region’s objective is to strengthen the capabilities and COVID-19 recovery growth opportunities of agribusiness, tourism, and digital SMEs and entrepreneurs in the project’s target regions through the provision of financial and non-financial support. It consists of following sub-components: (i) support to start-ups and SMEs in target sectors and regions; and (ii) strengthening firm capabilities through ecosystem upgrading. The fourth component, project implementation will finance the project implementation unit (PIU) and allow it to implement the project, comply with fiduciary rules and the environmental and social framework (ESF), and fulfill monitoring and evaluation (M and E) commitments. The fifth component, contingent emergency response component will allow for the reallocation of financing to provide immediate response to an eligible crisis or emergency, when and if needed.