Data Centers in Madagascar
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Madagascar – Strategic Entry for East African Connectivity
Executive Summary
Madagascar is an emerging market for businesses establishing a foundational digital presence in the Indian Ocean region. While infrastructure is still developing, its strategic location and improving subsea cable links provide a crucial entry point for serving East African markets and ensuring content delivery is closer to end-users. This market is best suited for organizations with a long-term strategy for regional service delivery.
Madagascar: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Reflects improving subsea cable access but limited terrestrial and peering infrastructure. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest major cloud hubs are in South Africa; private connectivity is required. |
| Power Cost | $0.07/kWh, as of December 2024 | Competitive pricing, but grid reliability requires significant on-site backup generation. |
| Disaster Risk | High (5.4/10), as of September 2025 | Significant exposure to cyclones and flooding necessitates resilient infrastructure planning. |
| Tax Incentives | Yes | General credits for digital and energy connectivity are available, not data center-specific. |
| Sales Tax | 20% VAT, as of September 2025 | Standard rate is applicable to most equipment and services. |
Network & Connectivity Ecosystem
Carrier Density & Carrier Neutrality Carrier density is developing, with services concentrated among a few key national and regional providers as of September 2025. The market has very limited carrier-neutral facilities, with interconnection often occurring at specific cable landing stations or the primary data center.
Direct Cloud On-Ramps Direct cloud on-ramps are not available within Madagascar as of September 2025. Businesses must connect to cloud provider networks in the nearest hubs, such as those in South Africa. This is typically achieved through private network extensions or dedicated IP transit links from local carriers.
Internet Exchange Points (IXPs) The Madagascar Internet Exchange (MGIX) is the primary IXP. It facilitates local traffic exchange to reduce latency and lower transit costs for domestic internet users and businesses.
Bare Metal Bare metal solutions are available, often provisioned by regional providers serving the African continent. Options from vendors like OVHcloud can serve the market from nearby hubs, providing dedicated compute resources for performance-sensitive applications.
Power Analysis
Average Cost Of Power The average industrial power cost is approximately $0.07/kWh, as of December 2024. This competitive rate helps manage operational expenditures for compute-intensive workloads, though it must be balanced against grid stability investments.
Power Grid Reliability The national power grid faces significant reliability challenges. Data centers operating in the capital, Antananarivo, mitigate this with multiple on-site generators, extensive UPS systems, and redundant fuel storage to ensure continuous uptime and meet service-level agreements.
Market Access, Business & Tax Climate
Proximity To Key Business Districts The country's primary data center is located in Antananarivo. This provides low-latency access to Madagascar's main commercial, financial, and governmental sectors, which are concentrated in the capital city.
Regional Market Reach From a base in Madagascar, organizations can effectively serve the local population of over 30 million. It also serves as a strategic connectivity point for island nations in the Indian Ocean and coastal East African countries.
Tax Advantage For Data Centers The government offers broad financial incentives for projects related to digital and energy connectivity, which can lower the investment cost for new infrastructure. These programs are designed to stimulate national economic development rather than being exclusively for data centers.
Natural Disaster Risk
Madagascar has a High natural disaster risk profile, with an INFORM Risk score of 5.4 out of 10 as of September 2025. The primary threats are weather and water-related, demanding facility designs that prioritize resilience and comprehensive disaster recovery plans.
Key risks include:
- Tropical Cyclone: High risk (6.7)
- Tsunami: High risk (6.4)
- Coastal Flood: High risk (6.3)
- River Flood: High risk (6.1)
- Drought: Moderate risk (4.4)
