PROJECTS

JIRAMA Power Sector Fiscal Management Tool, Madagascar

The problem

Madagascar’s power sector required subsidies equivalent to 1 percent of GDP to cover operating costs. Arrears in payables owed to suppliers amounted to about 5 percent of the GDP. Moving forward, investment in hydro-power generation is the best option to meet growing demand while bringing down the cost of power, but JIRAMA—the public utility—lacked funds for investment, relying on government to underwrite it. These factors meant that the sector posed a fiscal risk that could destabilize government finances and the economy, if not properly managed

How we helped

Castalia developed a tool to allow the Government to monitor JIRAMA and quantify future fiscal costs. The tool helps the Government anticipate, program, and make informed decisions on the utility’s liabilities by: identifying the annual subsidy needed to close JIRAMA’s operating deficit (and how tariff decisions impact the deficit), forecasting liabilities; and calculating contingent liabilities from Government support to hydro investments.

Impact

The Ministry of Finance is using the tool we created to manage the fiscal risk from JIRAMA and work out a way to minimize the fiscal burden.

The client

The World Bank

Our team

David Ehrhardt

David Ehrhardt

Chief Executive
Gianmarco Servetti

Gianmarco Servetti

Practice Leader
Laurie Hervot

Laurie Hervot

Analyst

How can we help you?

How can we help you?

WASHINGTON, DC
+1 (202) 466-6790
1747 Pennsylvania Avenue NW, Suite 1200
United States of America

SYDNEY
+61 (2) 9231 6862
Level 1 Kyle House, 27-31 Macquarie Place
Australia

AUCKLAND
+64 (4) 913 2800
74D France Street, Newton South
New Zealand

WELLINGTON
+64 (4) 913 2800
Level 2, 88 The Terrace
New Zealand

PARIS
+33 (1) 73 44 26 97
6 Rue Duret
France

BOGOTÁ
+57 (1) 508 5794
Calle 81 #11-08, Piso 5, Oficina 5-127
Colombia

Thinking for a better world.

Castalia-logo-negative-2col
PROJECTS          NEWS         CONTACT
© Copyright 2019 Castalia. All rights reserved.  Terms | Privacy | Credits | Sitemap

WASHINGTON, DC
+1 (202) 466-6790
1747 Pennsylvania Avenue NW, Suite 1200
United States of America

SYDNEY
+61 (2) 9231 6862
Level 1 Kyle House, 27-31 Macquarie Place
Australia

AUCKLAND
+64 (4) 913 2800
74D France Street, Newton South
New Zealand

WELLINGTON
+64 (4) 913 2800
Level 2, 88 The Terrace
New Zealand

PARIS
+33 (1) 73 44 26 97
6 Rue Duret
France

BOGOTÁ
+57 (1) 508 5794
Calle 81 #11-08, Piso 5, Oficina 5-127
Colombia

Thinking for a better world.

Castalia-logo-negative-2col
PROJECTS          NEWS         CONTACT
© Copyright 2019 Castalia. All rights reserved.
Terms | Privacy | Credits | Sitemap