How Malawi moved from hunger to exporting food

By STEPHANIE NOLEN
Toronto Globe and Mail
Friday, October 12, 2007

Something is missing in Malawi these days: anxiety. The sense of tension and strain that underlay nearly every conversation and interaction in the past few hungry years, is absent. There is a lightness in most parts of the country, an expansiveness, a certain sense of peace.

It has to do with the nkhokwe, the woven twig corncribs that stand in the yards of every house. They're full. They're full to overflowing at many houses, two-thirds full with plenty of corn at others. Certainly so full that no one bothers to guard them. Who would steal, when the country has a grain surplus of more than a million tons?

A record harvest, a massive surplus of the staple crop, would be good news anywhere in the developing world. But it's particularly gratifying in Malawi, a country that has been plagued with critical food shortages several times in the past decade. In 2002, an estimated 1,500 people starved to death in the worst food shortage since independence. In 2005, the United Nations World Food Program scrambled to supply emergency rations to more than 5 million people, nearly half the country.

This year, Malawi is itself supplying the World Food Program, selling 400,000 tons of maize for use in emergency operations in neighboring Zimbabwe.

The key question is, What happened? How did Malawi go from famine-plagued to food exporter?

While steady rains have undoubtedly helped, that's not the whole answer. Over the past couple of years, Malawi has broken with an orthodoxy long advocated by western donor nations: The impoverished country has gone back to subsidizing poor farmers. Condemned by donors as an impediment to the development of a sustainable agricultural sector, the subsidies have been a raging success.

"What is different (this year) is the access to inputs," explained Patrick Kabambe, permanent secretary in the Ministry of Agriculture and Food Security. "People are so poor they use recycled seed and no fertilizer. They can't meet their needs that way and they grow no surplus. People sink deeper and deeper into poverty. It's a vicious cycle. We had to do something."

Starting in 2006, and on a larger scale this year, the government distributed coupons to low-income farmers to allow them to purchase 110 pound sacks of fertilizer for 950 kwacha($7) rather than the market price of 4,500 kwacha. As a result, the average farmer's yield jumped to two tons per 2.4 acres from 1,760 pounds.

The fertilizer subsidy cost the government $62 million -- 6.5 percent of the total government budget, a "whack of cash" in the words of one top economist -- but that pales in comparison to the $120 million the government spent importing food aid in the 2005 famine. And the sale of maize to Zimbabwe and other countries will inject an additional $120 million into the national economy, a sizable figure here.

Mary Kalika certainly thinks the subsidy policy makes sense. Kalika and her five children farm a little less than three acres of land in this nine-house village in central Malawi. "We harvested 42 oxcarts of maize this year; that is the most ever for this land," she said. "It's very good news, and it's because of the subsidized fertilizer."

Kalika has already sold some of her surplus to buy seeds and tools to plant tomatoes to sell in town for cash. She may put a new roof on their house, and buy the children school uniforms if the tomato crop does well.

That is Kabambe's goal, his vision for helping people out of the cycle of poverty. That seems straightforward enough, but the history of subsidizing agriculture here is a lesson in the competing interests and influences that go into the politics of food and aid.

Back in the 1990s, the Malawi government gave the poorest farmers a package of fertilizer and seeds every year. The program was so popular that in 1999, they made it universal, for all farmers, and posted a large national surplus. But starting in 2000, the donor nations on whom this country depends for nearly half its budget forced the government to scale back and then finally to scrap the policy, saying it "distorted the market" and would prevent a sustainable agricultural base.

The result? Smaller and smaller harvests and two years of famine.

Some blame fell on poor rains, but it was also true that 75 percent of the population are subsistence farmers who could not afford either fertilizer or seeds.

"We didn't advise the government to stop starter packs (of free seed and fertilizer). We said if you want to subsidize, it has to be targeted," World Bank country director Tim Gilbo said. "It doesn't make sense to subsidize those who can afford to buy. We didn't have a problem with it, our only advice was that it should be targeted."

Eventually, the Malawi government took a stand, quite out of character in Africa where donor countries dictate domestic policy. "The president said (to civil servants) that he would never go begging for food for his people again," Kabambe recalled. Stuff the donor countries, they said, in essence: Bring back the subsidies. Hence the low-cost fertilizer. And a 370,000-ton surplus last year. And the record-smashing 1.2 million tons this year.

"The subsidy is the best thing to happen in the agricultural sector in years," said Richard Petautchere of the Malawi Economic Justice Network, an organization that advocates for the poor. "We have the land, we have the water, we have everything, but that doesn't matter if you just can't buy seeds or fertilizer."

Kabambe said donors have also come to see the wisdom in the subsidies. "They have all come back around to say we want to support this, he said. And Britain and the European Union have pledged to underwrite the fertilizer coupons for four years.