Posted on February, 10, 2022 at 07:13 am
In 2020, the Malawian government introduced the Affordable Inputs Program — a 160 billion Malawian kwacha ($199.2 million) program that allows Malawian subsistence farmers to purchase farm inputs at a subsidized cost with the government paying over 70% of the cost. The program aims to reduce poverty and ensure food security at household and national levels by increasing access to improved farm inputs.
Though the program’s goals were similar to those of its predecessor — the Farm Input Subsidy Program which ran from 2005 to 2019 — the 2020 AIP budget was more than four times higher than the last FISP budget.
But since its inception, the program has faced several hiccups such as low supply at selling points, accusations of corruption, and a lack of support from suppliers. Agriculture policy experts have questioned the program's effectiveness and recommended subsidizing large scale farming and widening AIP’s focus as more effective ways of improving food security.
On average, 6 out of 10 Malawian families are deemed to be severely food insecure. Tamani Nkhono Mvula, an agriculture policy expert, said this is a clear indicator that AIP and it’s predecessor the FISP have done little to improve the economic livelihoods and food security of rural families.
AIP accounts for over 45% of Malawi’s agriculture budget. “If this money was invested in other ventures, the multiplier effect could have been higher than what we have done,” Nkhono Mvula said. Adding that despite the large investment in AIP’s maize, production only increased by 300,000 metric tons between 2020 and 2021.
“We need to refocus the program and do it as is done in other countries like South Africa where large scale farmers are subsidized creating jobs for the poor and food security for the nation,” he said. Adding that large scale farming has the capacity to substantially increase production.
In South Africa, the government subsidized large scale commercial farmers who were not considered loan worthy by financial institutions through the Agricultural Credit Board from the 1950s. The same approach would be a better option for Malawi, Nkhono Mvula said.
Economists have also cautioned that despite the increase in maize production food insecurity still persists in Malawi as food availability goes beyond maize production and includes other dietary requirements and access to food also depends on the ability to purchase foods from the market.
In 2020, the International Monetary Fund expressed concern over the narrow focus of AIP, which aims to improve maize production where its predecessor FISP also supported other crops. The agency also stressed that targeted cash transfers would be more effective in supporting rural households.
Source: Devex