Rural income and poverty during times of change in Malawi

In most poor countries, supporting agriculture is the most obvious way to stimulate rural growth and provide food security. In Malawi, rural families have responded differently to radical policy changes and environmental crises. Looking at their changing livelihood strategies and incomes over time helps to analyse policies aimed at poverty reduction.

A paper from Harvard University in the USA reviews changes in income experienced by rural families in Malawi over the period from 1986 to 1997 and analyses the reasons for these changes. Until the late 1980s, Malawi’s agricultural economy favoured large estate holders over small-scale producers. As part of a structural adjustment programme, the government allowed partial privatisation of agricultural markets. However, private crop traders failed to take on the state’s crucial role as food supplier in deficit seasons, resulting in a food crisis in 1987.

Two policy shifts have been crucial for smallholders. First, in the early 1990s, smallholders were allowed to grow and sell burley tobacco, which had previously been limited to large estates. Burley tobacco production has benefited smallholders, especially those with enough land, labour and inputs, and with access to the farmer clubs. These smallholders are able to sell at world prices on the Auction Floors. Second, the government, with donor support, distributed small packages of fertiliser, hybrid maize seed and legumes free of charge to all smallholders (though later this was narrowed to targeted categories).

Following these policy changes, agricultural production did diversify. However, maize remains central to the food security of most smallholders. Key findings include:

• Government-subsidised packages intensified the livelihood strategies of smallholders, and did not reduce production or the effort smallholders put into work.
• Land remains scarce and most families are unable to achieve self-sufficiency from their own production. More than 90 percent of households bought extra maize.
• Most families lack the resources and access to financial institutions to grow burley tobacco on a profitable scale, though poorer farmers continue to earn some cash from small scale production.
• Over the ten-year period, gains were much greater among wealthier farmers and overall inequality greatly increased.

The government continues to play an essential role in guaranteeing supplies of staple foods for consumers in the deficit season. However, the government and donors have failed to provide a sustained set of agricultural policies: this remains the challenge.

Given the obstacles faced by Malawi’s rural economy, the author recommends the following to enhance development and food security in times of shortage:

• Government involvement is necessary to assure supplies of staple foods in times of crisis, as well as to improve overall economic performance in rural areas.
• Research must be directed to providing new techniques to increase agricultural productivity.
• Farmers’ associations need more support to give smallholders greater influence over the buying and selling of produce.
• Infrastructure development, especially roads and electricity, is crucial to encourage non-farm activities as an alternative income source.
• Civil society organisations have a valuable role to play in holding government accountable.

Source(s):
‘Rural Income and Poverty in a Time of Radical Change in Malawi’, Journal of Development Studies 42 (2), pages 322-345, by Pauline E. Peters, 2006 Full document.

Funded by: USAID; Harvard University; World Bank.

id21 Research Highlight: 19 January 2007

Further Information:
Pauline E. Peters
Kennedy School of Government and Department of Anthropology
79 JFK Street
Harvard University
Cambridge, MA 02138
USA

Tel: +1 617 495 3785
Contact the contributor: pauline_peters@harvard.edu

Kennedy School of Government, Harvard University

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