Madagascar is the fourth largest island in the world, has 5 000 km of Indian Ocean coastline and has a unique natural offering with 90% of all it’s flora and fauna endemic. There are more than one hundred types of Lemurs, countless chameleon species, a rich cultural heritage and pristine private islands to explore. This is a country which I have had the privilege to visit several times in the past decade.
As a leisure tourism destination, Madagascar has huge potential and a unique ecological offering. Eco tourism in particular has high potential with diverse climates, landscapes and unique natural phenomena. With its sensitive ecosystem tourism development will need to be well controlled to find the right balance between volumes of arrivals and retaining the prestige offering. Resort and island tourism is another high potential segment with a good mix of beach and nature attractions.
But hotel and tourism investment is anything but easy in this natural paradise. Since the recent political instability commenced in 2009 the tourism sector has been hard hit. Aside from the damaged reputation, air access has reduced and Madagascar is difficult and expensive to get to and to get around. Recent strikes and poor reliability from the national airline only exacerbate this situation. Due to the large scale of the main island and the poor quality of the roads, air access is critical. As a result Madagascar receives only a fraction of the tourist arrivals of its Indian Ocean neighbors yet with arguably a more exciting tourism offering.
The recent take over of the management of several airports by Aeroports de Paris and a push to open skies could change this. Once good air access is in place between tourist markets and Antananarivo and once reliable domestic connections are available the country will open up. Add political stability and increased tourism promotion to the mix and this country could move to the top of emerging leisure destinations.
Given the lack of stability, limited air access and difficult administrative climate to navigate, we do not advocate rushing into investing in hotels in Madagascar in the short term. There are select opportunities to invest in existing assets with potential but most lack scale. This is one for the watch list for the mid- to long-term. And perhaps a holiday to start the exploring… Enjoy!