The Successes (and Failures) of Seed Subsidies in Malawi

The Successes (and Failures) of Seed Subsidies in Malawi

While corn is not native to Malawi, it has become the country's staple crop. Photo: <a href="">Nathan Laurell (flickr)</a>
While corn is not native to Malawi, it has become the country's staple crop. Photo: Nathan Laurell (flickr)

Teach a man to fish and you feed him for life; if you give a family seeds, do you feed them forever?

For decades, the people of Malawi have lived with chronic food shortages, prompting massive food aid interventions. But these unending handouts of foreign-grown food are unsustainable, so how can one of the poorest countries in the world enable its population to produce the food they require? One answer is to give the Malawian people the tools to grow it themselves.

A scorching drought ruined the 2005 Malawi growing season. Compounded with an economy that didn’t allow many to plant in the first place, this left the people hungry, reported the New York Times. Five million Malawians, almost 40 percent of the population, required emergency food aid -- the proverbial fish handout. At the time, World Bank policy was to promote cash crops and exports. This incentivized farmers to grow crops for use outside of the country, that would in turn allow they to buy food. But after more than a decade of implementation the strategy had yet to pay off, the Times notes.

After the food crisis in 2005, something changed. Newly elected President Bingu wa Mutharika defied the decades-old advice from the World Bank. Instead of encouraging cash crops, the government started subsidizing fertilizer and maize seeds for the poorest of the poor. At the time, the national poverty rate was at 53 percent, so this was a huge undertaking. This move defied the conventional wisdom of the West and the World Bank and carried a sizable risk of alienation and failure, reports the Times.

Despite these challenges, the government of Malawi distributed millions of coupons for two 50-kilogram bags of fertilizer -- enough to treat an acre -- and seeds to fill half that space. These coupons allowed the holders to purchase fertilizer and seed at a fraction of the retail cost. With such small allowances the program was targeting subsistence or small-scale farmer, who likely only owned a few acres, this giving the common people of Malawi the tools to support themselves.

The crops and fertilizer, when combined with the abundant rainfall of 2006, completely transformed the barren landscape. Maize production more than doubled that year, from 1.2 million metric tons to 2.7. By 2007, production was up to 3.4 million and instead of importing food aid, Malawi became the largest exporter of corn in Southern Africa to the World Food Program.

However this success has come at a cost. Between 2008 and 2009, the government of Malawi dedicated a full 16 percent of the national budget for seed and fertilizer subsidies. This strain prevented other projects, such as irrigation systems, from getting off the ground. And some question the sustainability of the subsidies. Elizabeth Sibale, a consultant at the UN Food and Agriculture Organization in Malawi, commented that “[Malawi is] forgetting all the other problems that affect farmers and putting a Band-Aid on them."

It has been a full six years since the initiation of the subsidy program and it's harvest time again in Malawi. But even as the corn is harvested and processed, the Malawian government is debating the future of the subsidies. The program officially ends in June and while the program has been successful at raising corn production and lowering poverty levels, the true cost of the subsidies has been steep.

So the question remains: Are fertilizer subsidies teaching families to fish, or are they just handouts wrapped in a new package? The answer seems to be somewhere in between. Ensuring access to seeds and fertilizer is an important step in reducing poverty, but it is only one step. In 2004, about 60 percent of Malawi's population was impoverished. Today the poverty rate has fallen to 40 percent. These numbers seem to suggest that the idea is working, but the remaining poverty level demonstrates that it’s not enough.

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