The Malagasy government is strengthening oversight of the extractive sector. From now on, the granting of mining permits in Madagascar will be strictly conditioned on the effective payment of the Mining Social and Community Investment Fund (FMISC), according to a new official directive issued by the Ministry of Mines. The measure marks a significant shift in the country’s mining governance and ends the previous system under which simple letters of commitment were accepted by the administration.
Under the new regulation, mining operators must now provide proof of actual payment into the dedicated FMISC account managed by the Public Treasury before any permit can be issued. The mining administration aims to ensure that social and community contributions linked to extractive activities are genuinely paid and available to finance local development projects.
The reform applies to all operators in the sector. Holders of permits reserved for artisanal miners (PREA) are required to pay a fixed contribution of one million ariary. For companies applying for exploitation permits (PE), the FMISC contribution is set at 3% of the project’s initial investment. The amount is calculated based on the prefeasibility data submitted as part of the permit application process.
The Ministry of Mines also stated that companies that had previously submitted letters of commitment to the Madagascar Mining Cadastre Office (BCMM) must now regularize their situation by making the effective payment of the fund. The decision reflects the authorities’ intention to strengthen credibility and transparency within the mining sector, at a time when governance and the redistribution of extractive revenues remain highly sensitive issues.
The FMISC is intended to finance development projects benefiting local communities affected by mining activities. Madagascar’s Mining Code stipulates that the fund must be managed transparently in cooperation with decentralized local authorities and affected populations. Through this mechanism, the government hopes to better address the social and environmental impacts of mining projects while improving the acceptance of investments among local communities.
However, the reform comes amid growing concerns over the management of the Malagasy Sovereign Fund (FSM), which was appointed in 2024 to oversee the FMISC. An audit conducted by the Court of Auditors covering the 2022–2025 period reportedly identified several irregularities, including governance issues, questionable financial transfers, and a lack of transparency in the management of public resources. These findings have intensified criticism surrounding the administration of funds connected to the extractive sector.
For investors, the new requirement may lengthen certain administrative procedures, but it also sends a strong signal regarding the social obligations of mining companies operating in Madagascar. Malagasy authorities are seeking to strike a better balance between natural resource exploitation and local development as the country works to modernize its mining framework and strengthen confidence in the extractive industry.
