Madagascar in Crisis: Mauritius Confronts the Abrupt Awakening of Its Strategic Neighbor

Since September 25, protests have rocked the large island of Madagascar, threatening to destabilize an entire regional economic ecosystem. For Mauritius, which has heavily invested in its neighbor, the political instability in Madagascar reveals a dependency that has now become problematic.

"Madagascar remains, until now, a sleeping giant." This phrase from Sunil Boodhoo, former director of international trade at the Mauritian Ministry of Foreign Affairs, resonates differently since September 25. On that day, the large island plunged into a major political crisis, demanding the resignation of President Andry Rajoelina. The giant has awakened, but in anger.

For Mauritius, a small island nation with 1.3 million inhabitants, the shock is severe. The country suddenly realizes the fragility of its regional development model, which has been built over the years on a risky bet: that of a stable, predictable Madagascar open to Mauritian investments.

This Saturday, Mauritian Foreign Minister Ritish Ramful provides an update in a phone interview. The assessment is sober: 41 Mauritians have been repatriated since the protests began, with six others still on the ground. "The most important thing is to ensure that our compatriots in Madagascar are safe. Since the beginning of the protests, we have established a line of communication with them," he states.

Beyond the numbers, an entire economic strategy is at stake. "Any deterioration of the situation will have a direct impact on trade exchanges between the two countries, especially in terms of food supply," warns the minister.

Madagascar was supposed to be the miracle solution to Mauritius's food insecurity. With 90% of the arable land of the Indian Ocean Commission concentrated on its territory—millions of hectares of cultivable land—the large island was expected to ensure regional self-sufficiency. Rice, corn, grains: key products to reduce dependence on expensive imports.

However, the dream of becoming the regional granary is facing a politically unstable reality. "Let us hope that what is happening serves as a wake-up call to change direction and commit to inclusive development and prosperity," wishes Sunil Boodhoo, whose 35 years of experience provide him with a clear understanding of the situation.

An Exposed Economic Fabric

The extent of Mauritian investments in Madagascar reflects a deep intertwining. In the banking sector, BNI—where the CIEL group is a major shareholder—has become one of the main institutions on the island. MCB and SBM are also present there. In agro-industry, the Eclosia group has established itself in various segments, including poultry.

Textiles particularly illustrate this dependency. Benefiting from the Africa Growth and Opportunity Act (AGOA), CIEL Textile has relocated part of its operations there. "We have made substantial investments in Madagascar, particularly in the textile sector, and we have developed a value chain with upstream and downstream links to produce and export under the AGOA trade regime," details Sunil Boodhoo.

The IBL group has invested in logistics. All these positions now expose Mauritian companies to "increasing uncertainty regarding the stability of contracts and infrastructures, a probable slowdown in investment projects, and heightened threats to the safety of their expatriate staff," analyzes economist Manisha Dookhony.

In terms of the labor force, in three years, the number of Malagasy workers in Mauritius has doubled. In construction, tourism, and manufacturing—sectors facing labor shortages—they fill the workforce gap. Fewer in number than Indians and Bangladeshis, they have a decisive advantage: the French language, which facilitates communication with Mauritians. This human resource could dwindle if the crisis persists.

Acute Instability

For Manisha Dookhony, who observes the strengthening of bilateral relations through economic forums, "the current political crisis introduces substantial risks." Her prognosis is concerning: "A quick resolution seems unlikely. A realistic scenario anticipates a period of acute instability lasting several weeks to a few months, followed by a phase of transition and political negotiation that could extend one to two years before a fully conducive business climate is restored."

In light of this outlook, Minister Ritish Ramful bets on regional diplomacy. "Mauritius and Madagascar are neighboring countries, and we are part of regional organizations such as the Indian Ocean Commission. Regional stability is paramount. We urge the Malagasy people and all concerned parties to restore this stability as soon as possible."

This call comes with a barely veiled warning to the Malagasy authorities: "The government must listen to all components of society, including Gen Z. Therefore, it is important that everything is done with transparency and dialogue. This is what we do in Mauritius. That said, we must remain vigilant, taking into account all movements that could provoke such situations and leverage them politically in the short term."

A major trading partner for Mauritius, an emerging granary in the Indian Ocean, a country rich in gold, minerals, precious stones, and oil: Madagascar is full of superlatives. However, the political instability reveals an uncomfortable truth for Mauritius. Its immense economic potential remains largely theoretical as long as governance remains fragile.

"Its vast development potential could propel our Indian Ocean region if fully exploited," acknowledges Sunil Boodhoo. The conditional indicates it all: between the dream of profitable regional integration and the reality of a recurring political crisis, Mauritius is discovering that betting on the sleeping giant entails risks it may not have fully grasped.