The Strong Presence of Chinese Investment in Madagascar: Threat or Opportunity?

Abstract

The purpose of this paper aims at giving an answer of whether the strong presence of Chinese investment in Madagascar is a threat or opportunity? In this regard, using the panel data over the period of late-1990s, which is marked by a significant influx of Chinese migrants until 2019, it is found that in one hand, the Republic of Madagascar wishes to attract investors and make the private sector the main engine for its development, the government adopted laws whose goal is to provide attractive and practical climate. It is also important to be able to deal with international competition and to build a tangible competitive advantage. In another hand, the reality is different from which was expected. Actually, the impact in the Malagasy’s economy deceitful and the confidence between the two parties has been undermined. Many Chinese companies do not respect environmental conditions nor labor law. That is why the growing presence of Chinese investors creates dispute between the Malagasy government and the citizens.