The government has moved to reclaim tonnes of maize being held as collateral by local commercial banks so that it is distributed to about 3.8 million Malawians who are food insecure.
This was revealed on Tuesday evening when President Lazarus Chakwera was addressing the nation on the Affordable Inputs Programme (AIP) and other agriculture sector issues.
Chakwera disclosed during the address that the government has secured $50 million to reclaim the maize which the banks kept under siege for the grain marketer to obtain loans.
“The maize will be used by the government to reclaim and redeem the Admarc [Agricultural Development and Marketing Corporation] maize that is being held as collateral by local banks, and the government will have that maize available for distribution to the millions who need maize relief,” he said.
Malawi University of Business and Applied Sciences-based economist Betchani Tchereni said while people are facing hunger, the government should refrain from borrowing for consumption.
“There is still a worry that the government borrows for consumption, which is not healthy for the economy. Let us start borrowing for investments not consumption,” he said.
Before suspension of services, Admarc had been borrowing funds from local banks to fund its operations, especially to buy maize from farmers for both social and commercial purposes.
A Malawi Vulnerability Assessment Committee report indicated that about 3.8 Malawians, both in rural and urban areas, will face hunger in 2022-23.
The report attributed the development to low yields which have been realised as a result of weather shocks such as storms that hit the country and delayed rains.
Chakwera first announced on Saturday that the distribution of relief maize would start next month.
Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.
He is however flexible as he also writes about current affairs and national issues.