Peasant farmers powered GDP

A barrage of commentators has questioned the trickle- down effect of high growth domestic product (GDP) growth Malawi has experienced over the years. Remember the tale or town talk about second fastest growing economy in the world after some gulf oil rich tiny State?

Certain recollections proved to the contrary. It appeared in some circles that Angola, Mozambique, Tanzania and Ghana were on the rise, courtesy of resource booms. Not much noise was made though. I wouldn’t question the stats in our case. But a closer look at the source of high growth offers some insights. There has been a little trickle-down effect of high GDP growth because the main producers are not connected to a profitable trading system. Effectively, little incomes are generated.

No one has had doubts about the efficacy of the fertiliser subsidy programme in increasing national grain production, particularly maize. Agriculture accounts for roughly 30 percent of our economic output. But what we have not realised or paid attention to, is the fact that over 70 percent of agricultural output is subsistence based.

In other words, it is meant for own consumption with periodic surpluses on the market for sale. It is a domestic non-foreign exchange earning market, to be precise. No value adding. Someone dreamt about crushing tomatoes and filling bottles with its juice for sale. Whatever happened, but the point remains adding value in our farming is crucial to pro-poor GDP growth.

Food security has remained a serious issue exposing millions to hunger despite the subsidy and increased grain production. In this respect, questions arise whether a high GDP really means anything to hardship reduction or poverty mitigation. Can we honestly brag about this? Certain mechanisms or sorts of safety nets are always required to ensure everyone has enough food.

Whatever the case, the fertiliser subsidy is good. But how long is subsistence farming going to be a solution to food poverty? Yes, it will lead to high GDP growth but welfares impact will continuously be questioned.

Land shortages are becoming critical. Global food shortages are becoming a norm. Certain portions of land are going to multinationals. Population growth remains high and per capita land holdings is dwindling. One day, we will risk having heaps of fertiliser with no arable land.

Listening to former US Secretary of State Condi Rice a week ago at the Republican convention, she drew my attention to something I thought didn’t matter to the US or OECD economies.

She argued that schools need to have good facilities and well-trained teachers, particularly among minorities. It would ensure that children have a brighter future, integrate and be more productive on the labour market. Or, at-least, become creative children, get good jobs or create them.

I wonder for how long, we can go on putting too much focus on subsistence farming. Are we going to procreate to simply farm on small pieces of land in the villages? Have World Food Programme white trucks with loads of maize? We still can attain high food security through sharpening skills of our labour force, provide an enabling environment for business to grow and flourish. Create jobs and equal opportunities for all.

President Joyce Band a few days ago committed to ending child labour on the farms. These are children of the poorest of our society, powering the high non-poverty reducing GDP. What are they going to do? Will this affect agricultural production? Maybe yes, but we are thankful of such bold steps in ending child labour at the highest level but questions about whether they succeed in life linger. The education system is in disarray despite eating much of the national budget.

The best way to make benefits of high GDP growth easily trickle to vulnerable folks is to empower them with right skills. Having a “nkhokwe” full of maize powered by a fertiliser subsidy, contingent on rain-fed farming is not only unsustainable but also risky approach to food security. It condemns the poorest to perpetual subsistence farming. Beneficiaries of the fertiliser subsidy are people who cannot afford to send their children to better schools. Consequently, they will lack opportunities that a modern day market requires and so goes the vicious circle. We risk having two parallel generations. Children whose parents made it and those that never made it.

We need to seriously question why University of Malawi and Mzuzu University have not rigorously extended their capacity to admit more students. A rigorous rethink of why the public college of accountancy has failed to grow. Similarly, we need to have a radical rethink why investment in technical colleges has been so sluggish. The dilapidated state of public secondary and primary schools leaves a lot to be desired. So does the erratic training of teachers at the few teacher training colleges. Indeed, the hunger for more education is evident but the reaction is snail paced. Mushrooming doggy private schools and colleges are indicative of a younger generation that is hungry for success. Unfortunately, we are letting them down. A huge educational budget is just a number if it fails to give opportunities to a younger generation. They dream big. They will not farm, of course, with a fertiliser subsidy inducement but flock to the cities in search of opportunities. Will opportunities avail themselves?

If only we could replicate the huge subsidy spending concept across the entire spectrum of education. It’s all about enhancing the ability of the youth to earn or make an income that will translate into a high GDP growth that is poverty reducing. Our population is growing fast; farming land is being greatly squeezed. We can’t take this path any longer.