Madagascar, world leader in vanilla with 3,200 tons exported last year; a record that had not been reached for ten years. Tuesday, November 15, on the island, the vanilla export campaign opened. A highly anticipated date for all players in the sector, who hope that international buyers will be convinced by the efforts undertaken to reform the sector. Nevertheless, several shadows remain on the board. Starting with the 165 requests for new approvals that have remained unanswered.
For several months, the Ministry of Trade and Industry has multiplied announcements in favor of cleaning up the sector.
Studies for the award of license renewals have been more extensive this year. In the end, only 70 of the 92 usual exporters had their license renewed.
But the campaign also opened without the 165 new applicants getting a response.
“At the moment, new requests, we are not processing them. Frankly, Edgard Razafindravahy, the Minister of Trade and Industry, explains that the priority is elsewhere:
The objective of the ministry and the National Vanilla Council is already that all the reforms are underway. Everything is transparent now. I can tell you that we work with complete transparency!
Recent communications thus remind exporters of the obligation of bank domiciliation on the island, but also of repatriating their export earnings.
The country has a hole of 1,400 billion ariary – equivalent to 320 million euros – in foreign exchange repatriation, caused, mainly, concede several entrepreneurs contacted, by the repeated “omissions” of vanilla operators.
“Twenty-two licenses have not been renewed. It is to sanction the non-repatriation of foreign currency at the level of Finex”, affirms the Minister, who underlines that the State, via the Ministry of Finance, “could also be led to initiate criminal proceedings” vis-à-vis offenders.
On the ground, for those who have received their approvals, the campaign is starting in slow motion. Buyers seem to be watching rather than buying, says Georges Geeraerts, president of the Vanilla Exporters Group in Madagascar.
There are two reasons for this wait-and-see attitude. First of all, we don’t really know what consumer habits will be with the economic crisis we are experiencing. We are already seeing repercussions on the consumption of certified organic products. But there is also an expectation on the part of these buyers regarding compliance in Madagascar with the various laws in force. So they are waiting to see if on the island, at each link in the chain, we have respected the prices, the minimum price of the green to be paid to the farmers, the price of the bulk, the prepared vanilla not yet completely stabilized and above all the 250 dollars per kilo of vanilla for export. What they want is for there not to be two markets: the official market, and the parallel market, as we experienced this year.
More controls, sanctions, for better fairness and equal opportunities in the sector, this is what a large number of exporters and civil society expect.