Targeted digital policy reforms could connect an additional 1.13 million people to mobile internet in Madagascar and generate MGA 4.1 trillion ($908.8 million) in additional GDP by 2031, according to a new GSMA report.
The report, Madagascar Digital Economy: Policy reforms that will drive Madagascar’s digital future, finds that although mobile broadband networks cover 66% of the population, unique mobile internet penetration stands at just 14.3%.
Total mobile connections nearly doubled from 12.3 million in 2021 to 22.5 million in 2025, but adoption has not kept pace with network expansion. By 2026, 66% of the population lived within range of mobile broadband networks but remained offline.
The GSMA identifies the affordability of entry-level smartphones as a major barrier. Basic handsets face a combination of a 20% import duty, a 6% copyright fee, a 1% regulatory levy and standard value-added tax, putting them beyond the reach of many households.
The report recommends removing the 6% copyright fee, reducing handset import duties and expanding device-financing programmes, including the Digital Ecosystem Connectivity in Madagascar project.
It also calls for the removal of the 8% sector-specific excise duty on mobile operators, arguing that these measures could reduce costs and stimulate demand.
“Smartphone affordability and digital literacy remain major barriers to adoption. Around one-third of the rural population is outside 4G coverage, with difficult terrain, limited electricity, costly backhaul infrastructure and high operating costs constraining rural network investment,” the study states.
Digital literacy and electricity access present further challenges, particularly in rural areas, where only 15% of households have access to electricity. Limited connectivity and low digital literacy can also restrict the uptake of text-heavy online services.
To address these barriers, the GSMA recommends a coordinated Rural Connectivity Plan, reforming the Fonds de Développement des TIC into an effective, results-based funding mechanism and enabling mobile towers to serve as anchor tenants for solar-powered mini-grids.
The report also highlights conversational artificial intelligence (AI) as a potential way to make digital services more accessible, including to people with limited literacy. It points to ATLAS Umoja AI, an open-source language model initiative focused on developing AI systems that understand and operate in African languages.
As ITWeb Africa previously reported, ATLAS Umoja AI aims to pool regional datasets and research to develop scalable AI systems, with initiatives targeting countries including Nigeria, Kenya, Togo, Namibia and Benin.
Angela Wamola, GSMA head of Africa, said Madagascar’s expanding mobile networks provide a strong foundation for digital transformation. She added that conversational voice services supported by ATLAS Umoja AI could help people with limited literacy benefit from connectivity.
Wamola said making suitable public language datasets available and bringing together mobile operators, governments, industry and researchers could support a pilot providing agricultural advice in Malagasy through voice-based services. Such an initiative could align with Madagascar’s digital agriculture strategy.
The GSMA argues that combining targeted tax reforms, device financing, rural infrastructure investment and localised voice technology with Madagascar’s Digital Strategic Plan 2023–2028 could help turn existing network coverage into broader digital adoption and economic growth.
The report concludes that coordinated action by government and industry will be essential to making mobile internet more affordable and accessible, particularly for rural communities.
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