Malawi, Ifad sign K42b financial access deal
Malawi on Wednesday sealed a K42.1 billion agreement with the International Fund for Agricultural Development (Ifad) to offer at least 437 000 rural households improved access to financial services.
The Financial Access for Rural Markets, Smallholders and Enterprise Programme (Farmse) deal was signed in Rome by Ifad president Gilbert Houngbo and Malawi’s ambassador to Italy Tedson Kalebe.
The $57.7 million project includes $21 million loan (about K15.3 billion) and $21 million debt sustainability framework grant from Ifad, a statement reads.
Government will inject $9.6 million (about K7.5 billion), with the beneficiaries themselves contributing $6.2 million (K4.5 billion).
“The intervention seeks to reduce the hardship faced by Malawians due to drought, food insecurity and HIV and Aids,” reads the statement in part.
The agriculture sector, which supports livelihoods of over 80 percent of Malawians, provides the bulk of the raw materials required by the manufacturing industry and contributes 40 per cent of total export earnings.
To address sector challenges, Farmse will boost and exploit the potential of micro-small and medium enterprises.
The programme will support government efforts to reduce poverty in rural areas and strengthen community-based financial organisations and commercial banks.
Since 1981, Ifad has financed 13 rural development programmes and projects in the country for a total cost of $499.1 million, investing $266.9 million directly.
Almost 1.9 million rural households have benefited from its funding, the statement shows.
