The dreamy vanilla-producing, baobab tree-fringed island of Madagascar is home to lemurs and famously the subject of a blockbuster Hollywood cartoon franchise. But it is also characterised as one of the Least Developed Countries of the world and one of the most biodiverse. Which is where Groupe Filatex comes in with its mission to develop and grow the economy to the benefit of all stake holders. Including the lemurs.
Groupe Filatex is a family owned and operated group of companies which have been working in Madagascar since 1978. Hasnaine Yavarhoussen is the current Chief Executive Officer and joined the company, originally founded by his Father, in 2012 becoming CEO in 2017. The very first enterprise Filatex undertook was the creation of an industrial free zone, establishing the company as a trailblazer in this sector in Madagascar. This venture, which it continues to lead successfully today, not only highlighted the untapped potential of free zones but also paved the way for Filatex’s expansion into the real estate industry
Said businesses led of course to a need for energy so Filatex have become a major provider of energy in Madagascar.
Hasnaine made it clear when speaking to us that the diversification of the group is ‘always related to the main business’ which has over time become the provision of efficient and reliable energy in the context of developing African countries like Madagascar. Today the free industrial zone in Antananarivo, the capital of Madagascar employs 39,000 workers and Filatex provides 42% of energy generated on the island. Although most of its business is conducted in Madagascar, Filatex has intimate connections with Mauritius and France.
Keen to expand its operations in what is a growing market Filatex has an innovative project to develop solar energy on the roofs of its existing free zones and the new free zone it is constructing. Hasnaine proudly told us
‘We currently have 180,000 square metres of rooftops and we’re going to make between 11 to 14 megawatt of solar production. So it’s quite big as a rooftop project and will provide customers (i.e., companies installed in the free trade zone) with a reliable and green source of energy.
When asked what he thinks are the three major problems in the energy sector facing Filatex and Madagascar Hasnaine is unequivocal in arguing that problem one is the grid, problem two the mix of energy sources to reduce reliability on heavy oil and third the financial viability of projects for investors.
Hasnaine is scathing as to the problems related to the power grid area, not just in Madagascar, but in Africa generally. He indicates that the grid is losing 35% of production due to poor conditions and lack of investment in the grid. The target is to reduce such losses to 5% in the immediate future while increasing reliability for consumers. As Hasnaine told us ‘We have to think about the whole sector, about transmission lines and the energy mix which should be in order to have less dependency on oil at the end. That’s the goal’.
Parallelly to the grid being fixed, the next step is to develop an energy mix with solar and hydro generators playing an expanded role as they come on line. In order to expand the provision of hydroelectricity in a country which has a number of rivers suitable for exploitation in this manner Filatex has partnered with the French hydroelectricity company Hyvity to form ENHY. The target for ENHY is to develop a number of small and medium sized hydroelectric installations. Within ten years Filatex Energies intends to have a further 300 MW under development, 100% renewable energy (mainly solar). A massive expansion to the current capacity of the grid. As always the condition of the grid is vital to these projects so Filatex Energies will work closely with JIRAMA, the state-owned utility and water services company in Madagascar, to upgrade the grid where necessary.
For Filatex another problem is ensuring that projects are derisked to make them more attractive to investors. The solutions proposed here are quite simple with the suggestion being made that the state play a role by providing guarantees or placing funds in escrow. Whatever the solutions in the future, it’s certain that Filatex will play a role in developing them.
Malagasy art and its promotion overseas is a passion for Hasnaine and Filatex. One major initiative in this field was the first Madagascan pavilion at the 60th International Art Exhibition in Venice. With over 600,000 visitors it put Madagascar on the international art map for the first time and Hasnaine is proud to have played a role in making it possible as he has been with the foundation of the Hakanto Contemporary art centre which is directed by the internationally renowned Madagascan artist Joël Andrianomearisoa. The valuable involvement of Hasnaine and the support of the Fonds Yavarhoussen were key in bringing the Venice pavilion and Hakanto Contemporary to life.
Hasnaine’s commitment, through the Fonds Yavarhoussen, reflects his conviction that by showcasing Malagasy art to the wider world, it can create a meaningful impact on the population by “giving back the possibility to dream to the younger generation.”
Hasnaine argues that achieving this goal requires a dual approach, with their support divided into two complementary parts. “Contemporary art and then we have history of art. How are we going to know our contemporary side without knowing our history? So we are publishing books. We are supporting researchers. It creates a lot of exciting and interesting projects when we support and promote these artists.”
With considerable experience and a proven track record Hasnaine is keen for Filatex to expand its operations across sub-Saharan Africa. At present only 33.7% of the population has access to electricity and Filatex actively contributes to achieve the government’s target for that to be increased to 70% by 2030. Across sub-Saharan Africa the position is not qualitatively better with an average of 48.4% in 2020 according to the World Bank.
Hasnaine is insistent and rightly so that Filatex has the ability, technical expertise and track record to provide sustainable and effective solutions to the provision of energy in emerging markets. All too often African countries have invested in major capital projects which have failed as a result of a lack of infrastructure to support them. Regarding this problem Hasnaine commented ‘everywhere in Africa they are talking about projects without having a complete solution, of being a producer of energy without knowing how they’re going to transport energy, it’s just not realistic’.
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