Bridging the Gaps for Economic Growth

Madagascar’s gemstone sector, particularly its sapphire industry, holds immense promise as a driver of economic growth and national development. According to the World Bank, industrial mining, if properly managed, could contribute up to 14% of the nation’s GDP by 2025. This projection underscores the transformative potential of the gemstone sector in generating fiscal revenue, creating jobs, and catalyzing infrastructure development.

However, the reality on the ground paints a different picture. Much of the gemstone trade in Madagascar remains informal, with illegal mining and unregulated exports dominating the industry. This lack of formalization results in significant revenue losses for the government and limits the broader socio-economic benefits that could be derived from the sector. Moreover, the absence of strict regulations exacerbates environmental degradation and undermines community well-being in mining regions.

To fully unlock the sector’s potential, Madagascar must adopt a holistic approach that addresses these systemic issues. This would involve formalizing the gemstone trade, incentivizing responsible mining practices, and investing in infrastructure to support value-added processes like cutting, polishing, and design. Partnerships with international organizations and private stakeholders could also play a pivotal role in building capacity, enforcing regulations, and creating a sustainable gemstone value chain.

By Alice Aubry, Founder of Gems with Origin