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World bank tips malawi on poverty reduction

 

The World Bank has cautioned Malawi government to pay attention to social safety nets when designing poverty reduction policies.

In its Malawi Economic Monitor titled Realising Safety Net’s Potential released on Thursday in Lilongwe, the Bretton Wood institution said there is evidence showing that social safety nets are making a substantial contribution in the fight against poverty.

The bank said the social safety nets—social welfare services provided by government and other non-State actors—could help people escape extreme poverty, close the poverty gap and reduce inequality as well as build household resilience to respond to shocks across the life cycle, which is key to building human capital.

Subsidised fertiliser is one of the country’s social safety nets

According to the bank, the proportion of the people living below the poverty line of $1.90 per day (about K1 387) declined by less than three percentage points between 2004  and 2010, from 73.6 percent to 70.9 percent.

Reads the report in part: “This means the poverty rate declined only at an annual rate of 0.6 percent. This is a considerably lower decrease than the average for sub-Saharan Africa at 2.1 percent and for neighbouring countries

Mozambique, Tanzania and Rwanda at 2.4 percent, 5.2 percent and 2.3 percent, respectively during the same period.”

It says the poverty trends highlight the importance of a dynamic social safety nets to meet the country’s future needs.

“Over time, national poverty has remained high and persistent in Malawi, declining only marginally from 52.4 percent to 50.7 percent between 2004 and 2010. While urban poverty reduced by eight percent during this period, rural poverty increased marginally to 17 percent and 57 percent, respectively.

“Compared to almost every other country in the region, Malawi faced the highest sensitivity to extreme dry events from 1980 to 2014 due to the high dependence on maize in terms of production and consumption.”

Minister of Finance, Economic Planning and Development Goodall Gondwe is on record as having said that in the forthcoming 2018/19 financial year, most of the projects in the agriculture sector will focus on irrigation to move the country away from dependence on rain-fed agriculture to ensure resilience in the country’s economic growth as well as poverty reduction.

He cited projects such as the Shire Valley Transformation Programme, Mzimba Integrated Urban Water and Sanitation Project, the Rural Irrigation Development Programme and the Sustainable Rural Water Supply and Sanitation Project to be implemented under the Department of Irrigation and Water Development.

Earlier, agricultural expert Tamani Nkhono-Mvula urged farmers to  desist from relying heavily on rain-fed agriculture and invest in climate smart agriculture to scale-up productivity and overcome climate change effects.

He said the change in rainfall pattern has affected the agricultural sector. n

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