Transforming Agriculture through Diversification and Entrepreneurship (Trade) initiative has emphasised the need to hasten the agriculture commercialisation drive as a step towards economic stability.
The firm says there is a need for a shift in agriculture production from small-scale subsistence farming to commercial.
Trade National Programme Coordinator Felix Lombe said momentum for diversification is hampered by excessive focus on smallholder farmers who are not effective drivers of diversification.
“Horizontal and vertical diversification is effectively done by medium-scale farmers because their risk appetite, especially to try new things, is high. We must re-channel our interventions to medium scale farmers because firstly they have the ability to produce more and are advanced by using mechanical means for production.
“Secondly this group has the ability to diversify because diversification is a risk and only medium-scale farmers have the ability to try new things which involve risks,” Lombe said.
In a separate interview, agriculture expert Leonard Chimwaza said relying only on smallholder farmers has proven detrimental.
“Most of the smallholder farmers in Malawi have a land holding size of around 0.4 hectares per farmer; so the production that can be obtained from this small piece of land cannot suffice the domestic or the external markets.
“Further, just because the smallholder farmers are not organised, they always find difficulties in accessing finance to support their production,” Chimwaza said.
A recent Malawi Economic Monitor published by the World Bank holds that a more robust and vibrant rural economy is needed to address Malawi’s economic difficulties.
It notes that in 2021, over three-quarters of all adults worked in agriculture and the sector contributed 43 percent to the country’s overall economic growth.
“Agriculture has many deep links with other sectors, and has an important impact on Malawi’s overall macroeconomic performance. The design of current major agricultural support programmes, such as the Affordable Inputs Programme, not only has direct impacts on the agriculture sector, but also limits fiscal space and consumes a significant share of available foreign exchange, thus reverberating across the overall economy,” it says.
The World Bank suggests that a vibrant rural economy, stimulated by improved policies and better targeted investments, could catalyse the economy as a whole, alleviating many of the macro-fiscal imbalances.