Is agriculture-led growth in specialised industrial processing and services that will absorb the current agriculture labour force and also contribute more to the GDP thereby reducing the percentage contribution of agriculture possible in Malawi? In this special feature, TAMANI NKHONO-MVULA*, explores ways in which the country can transform its agriculture sector.
Over the past year, there has been a lot of talk and debate on how Malawi can achieve an agriculture transformation that may lead to sustained food security and poverty reduction.
This discussion has mainly centred on how we can use the smallholder farmers as a force for both agriculture and national development. This is based on the understanding that smallholder dominated farming systems have been at the centre of the agriculture practice as well as the backbone of the economy.
Though a shift to large-scale mechanised farming is being suggested I am of the view that smallholder farming will remain the main feature of the agriculture sector and agriculture will remain the dominant sector of the economy and the powerful tool for development, food security and poverty reduction in Malawi.
Current statistics still favour agriculture over the other sector in their contribution to the economy and rural livelihoods in Malawi to the extent that the entire economy depends on the wellbeing of the agriculture sector.
Currently agriculture employs about 85 percent of the population, which is still mainly rural and agriculture accounts for about 60 percent of all rural economic activities.
When we talk about development, it is universally agreed that no country will achieve any meaningful development until the question of food security has been addressed.
However, in the current debate about agriculture transformation in Malawi, what I am still finding lacking is the definition of a clear long-term vision and a clear roadmap to achieve the much needed sought-after transformation.
My vision for agriculture in Malawi is to see a reduction in the number of people directly involved in agriculture production from the current 85 percent of the population to about 40 percent, to see a reduction in the agriculture’s direct contribution to the gross domestic production (GDP) from the current 40 percent to 20 percent by the year 2040 (in the next 20 years).
My assumption is that the growth and development of agriculture would have triggered a growth in specialised industrial processing and services that will absorb the current agriculture labour force and also contribute more to the GDP thereby reducing the percentage contribution of agriculture.
However, to achieve this there are a number of issues that need to be done and this article will attempt to discuss them.
Investing in agriculture
Over the past 20 years, investments for agriculture development have mainly been towards achieving food security.
The agriculture development flagship projects such as Starter Pack, Agriculture Productivity Improvement Program (Apip), Targeted Input Program (TIP), Farm Input Subsidy Program (Fisp) and even most of the big money donor projects in the sector, regardless of their intended objectives on paper, have ended up to be merely food security enhancing programmes with not much to show after their expiry.
There has generally been a huge investment in agriculture over the past 20 years. Estimates by some donors indicate that the combined donor annual investment into the agriculture sector in Malawi, at times went as high as $500 million (K365 billion at current exchange rate).
My question has been, with this kind of investment why is Malawi agriculture not developed? Why are we still a net importer of food? Why is poverty reduction not being achieved?
My observation is that one of the reasons for the state of affairs is like that, is because we are so much obsessed with investing in agriculture, which in most cases is for food security than strategically investing for agriculture, which is mainly for transformation and development. What I mean by that is, the agriculture transformation we are talking about will never be achieved if the institutional and physical infrastructure that aid agrarian transformation is not in place.
Malawi agriculture will never transform if it continues to suffer from lack of forward linkage as is the case at the moment, it will saturate and implode without any dent on poverty and food security despite the billions we are spending. We have spent billions on Fisp over the years but that has brought zero transformation to the sector, if we stop Fisp today, there will be completely nothing to show for the investment done.
Going through the draft National Agriculture Investment Plan, it is a well-articulated document, however, my fear is that if the backward and forward linkages for the smallholder farmers in Malawi are not developed, this beautifully written document will be another document in the making for failure. We will come back four years from now and look back and ask ourselves: “What went wrong?”
In any country where agriculture transformation took place, it never happened spontaneously, it was well-planned and these plans were part of the broader national development vision. Malawi agriculture transformation will never happen in isolation, it will depend on the equal development of the related sectors.
Others have said that agriculture development is a catalyst for industrial development but let me put it that agriculture development and industrial development are mutually reinforcing and in the case of Malawi with its saturated agriculture sector, it is industrial development that will triggered a positive change in agriculture.
Having understood the importance of agriculture to development and the urgent need for an accelerated sector transformation, countries like Ethiopia have established dedicated institutions for agriculture transformation.
Some may argue that Malawi has a Ministry of Agriculture with a fully-fledged Department of Planning. I do not have much of a problem with that, however, what I have observed is that the Planning Department does not necessarily do systemic and strategic research for agriculture development. Even if it does, the Ministry of Agriculture may not have the authority to put directives on the other ministries like those responsible for energy, transport and the industry to invest specifically to meet the strategic needs of agriculture.
The Ministry of Agriculture cannot instruct the Ministry Transport to construct a road to Misuku because it intends to develop the coffee value chain, it cannot instruct the Ministry of Finance to release the pension fund to facilitate the development of agriculture processing in Malawi, unless such directives are coming from a higher office.
The Agriculture sector Wide Approach framework was somehow meant to achieve something closer to that but the experience over the past five years has indicated that sector coordination when other ministries with different interests are involved is not easy.
Coming back to my vision for agriculture in Malawi, I would like to suggest what we need to do moving forward.
Firstly there has to be a realisation that agriculture transformation will never happen solely by a direct investment in agriculture unless what we want to achieve is merely food security with development as a collateral effect.
Having realised this, there will be need to have a long-term vision for the sector (maybe 20 years) this must clearly define what we want see in the sector within that period and it should provide the basis for any strategic investment, be it within the sector or in the related sectors.
With the Vision 2020 coming to an end and with the prospects of a new long-term national vision, we have a huge opportunity to rethink and restart agriculture development. As pointed out earlier, one thing that has made our agriculture to be stagnant and crop value chains not developed is the lack of a forward linkage.
The reason why most farmers are stuck in subsistence production is because of lack of markets for their produce and without a reliable market there is no incentive to produce more and to specialise. The result is poverty and more poverty. Farmers have complained of lack of markets for their produce for so long but these markets will not just appear from nowhere, there has to be a deliberate and well-coordinated effort to create them.
As part of developing this forward linkage, Malawi must strive to develop its industry to provide a market for the farmers and also to develop the value chains. The value chains will never develop if the industry remains in its current state.
For instance, the vibrant cotton value chain collapsed with the fall of David Whitehead, coupled with the wholesale opening up of the kaunjka imports. The outward linkage for cotton farmers was David Whitehead, as is the case with Illovo Sugar Malawi plc for smallholder sugarcane farmers.
If there will be no big and strong processing industry at the end of each value chain, transformation of those value chains will be a constant struggle. However, for the industry to develop, we need heavy investments in energy, we will need to restructure the financing and banking sector, we need to reform the public sector for an effective civil service and institutions of good governance to deal with corruption.
One case study we may try to experiment with is the Shire Valley Irrigation programme and the Greenbelt Authority (GBA). What industries are being developed or capitalised to provide an out linkage for these flagship programmes? How are universities like Lilongwe University of Agriculture and Natural Resources (Luanar), Malawi University of Science and Technology (Must) and The Polytechnic aligning themselves to provide the necessary human resources and the industrial research and development to give these massive project their transformative power?
Agriculture transformation can happen, it must happen, but for it to happen, we will need to think strategically, we will need to think outside the box.
*Tamani Nkhono-Mvula is a PhD Student in Development Studies, University of Malawi.