New Directions for Agriculture in Reducing Poverty

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Food aid in malawi



I am submitting my colleague, Edson Musopole's paper on "IMPACT OF FOOD AID ON 
LIVELIHOOD SOURCES IN MALAWI" for your consideration.  It has several 
implications for not just national governments, but also donors like DFID in 
terms of what programmes they support and their approach to food aid.  I have 
shared ActionAid's recommendationso n food aid with the group in earlier 
submissions.
-------------------------------------------------
IMPACT OF FOOD AID ON LIVELIHOOD SOURCES IN MALAWI, Edson Musopole, ActionAid 
Malawi

The Malawi food crisis of 2002/2003 resulted from a food supply gap of 
485,000MT caused by growing level of poverty and vulnerability, the impact of 
HIV/AIDS, food reserve mismanagement and unsound government policies. The 
crisis affected 3.2million people (28% of the national population) and called 
for 208,000MT of emergency food aid. The Government of Malawi, donors, NGOs and 
local church groups participated in providing food aid to vulnerable groups 
such as pregnant women, infants, destitute people, flood and drought victims.

Food aid is an aspect of welfare transfer entitlement, safety nets, and can be 
in-kind and cash. It is administered as targeted, untargeted and self-targeting 
transfers. Food aid in Malawi is used for both relief and development purposes. 
Malawi's dependency on food aid has been growing. 

The impact of food-aid has been perceived as generally successful in 
ameliorating hunger and malnutrition in short term and supportive of livelihood 
sustainability and national welfare. In the short-term food aid has benefited 
targeted vulnerable beneficiary households while creating dependency syndrome 
and distortion of local food prices and markets. 

This paper attempts to analyse the implication of growing dependency on food 
aid and the observed impact it is having on the sustainability of livelihood 
sources in Malawi.

Agriculture and Livelihood Sources in Malawi:

Livelihoods are means of people's access to adequate stocks and flows of food, 
cash and other resources to meet basic needs in an environmentally sustainable 
way.

Agriculture is the dominant source of livelihood practiced by 80% of the 
population. Smallholder agriculture practiced on an average land holding of 
1hactare by 70% 0f the farming community is mostly subsistent. It produces for 
household consumption and not much for the market. However failure to produce 
enough for household consumption calls for food aid to feed rural households by 
the Government. Malawi experiences both chronic and transitory food insecurity 
and has increasingly become dependent on food aid from donor countries. The 
situation is said to be exacerbating poverty levels and economic, social and 
political vulnerability.

The potential of agriculture as a livelihood source in Malawi is comparatively 
enormous if compared with other less fortunate countries. The country is 
endowed with arable land with fertile soils, rich water resource and wetland, 
cheap labour, relatively reliable annual rainfall, good climate etc. The large 
population in the country offers a ready market and sustainable income for 
agricultural producers of food and raw materials.

The declining agriculture potential leaves the country with no meaningful 
alternative source of livelihood for the predominantly rural dwellers. 
Therefore the scenario calls for the protection and improvement of efficiency 
in performance of the sector. The subsistent agriculture needs to be 
transformed into market based-commercial agriculture to create wealth and 
stimulate the national economy. Increased income from agriculture will 
proliferate investment into alternative sources of agriculture non-agriculture 
based livelihood sources. The economic linkage will enhance and sustain 
agriculture production, livelihoods and food security. There are no substitutes 
for agriculture development in societies that have a substantial rural sector. 
Providing food security is an important rationale for investing in agriculture 
to create confidence in food security manifested by stable food prices. The 
situation can be translated through extensive externalities and linkages into 
rapid economic growth.


The role of the market


Competitive rural markets efficiently deliver incentives to rural investors 
there by enhancing and sustaining rural livelihood sources. Promotion of 
private sector participation remains a key to the development of such a 
marketing system, which connects farmers with local buying agents. The system 
transmits market information and facilitates commodity exchange. The process 
generates gains in efficiency from trade. The marketing system serves to 
transform agricultural commodities at the farm gate into food at the time, 
place, and form desired by the consumer. An efficient market system has to 
solve the problem of price discovery, at least at the local level and 
seasonally, even if the government policy sets a band in which such price 
discovery must take place.  Most urban food systems are not well linked to 
domestic supplies but rely heavily on imports. Switching the role of food aid 
from mainstay of food relief to domestic food economy that provides ample 
incentive to farmers to increase productivity is an enormous challenge for the 
Malawi government. Though increase of produce prices is necessary to redress 
the complacence the problem requires other interventions such as changes in the 
way business is done, infrastructure, institutions and credit facility support 
is provided.   


The role of the Government in sustaining food security


Government's role is to prioritise agriculture, especially to raise 
productivity of agricultural commodities by farmers to ensure food security. 
Investment in public goods such as roads, communication system, market centres, 
extension and research services etc is necessary to improve efficiency of the 
domestic market system especially in the rural areas. Food security is a 
principal task of the Government. Policies to stabilise food prices are 
required to be instituted in favour of both producers and consumers. Inducing 
farmers to produce food for household and urban consumption requires the 
Government to pursue and agriculture development strategy that focuses on 
smallholder farmers.

The Government is also responsible for intervention in the market to stabilise 
prices in the domestic markets. Lately, however, agriculture and rural 
infrastructure have been under valued and market interventions have created 
disincentives and displaced markets rather than invest in improving their 
efficiency. Building an efficient rural marketing system requires careful 
intervention and support from the government, but not too much to allow the 
private sector to grow, learn to take risk and compete effectively. The 
Government has to learn to play its role in market economy just as traders, 
banks, shipping companies and support institutions must learn theirs. 

The Malawi government relies heavily on export of primary commodities to earn 
the foreign exchange needed to finance a food import strategy. The prices and 
earnings from the commodities are highly unstable and destabilize the entire 
macro-economy. The destabilization affects the economic growth. Therefore it is 
wiser to depend on domestic food production to ensure food security and 
stimulate economic growth than depend on commodity exports for foreign exchange 
earnings to be used for food imports. It is harder to stabiliser export 
earnings than to stabilise food prices.

To achieve this priority will have to be placed on investment in rural 
infrastructure and research on raising productivity of farming systems. 
Intervention will have to be effected to restructure incentives in favour of 
food production through stability of price levels for inputs and outputs. 
Increased investment in irrigation systems to stabilise agricultural output 
while raising crop yield will be prioritised. Failure to sustain food security 
results in disposal of production assets as coping mechanisms to survive severe 
food insecurity. Asset loss undermines livelihood sustainability. Food -aid 
helps to avoid asset erosion and under mining livelihood sources.


Food aid


Food aid has been promoted internationally by need for trade expansion and 
reduction of surplus grain, humanitarian and internationalist sentiments. The 
result, which is a marriage of surplus disposal and humanitarian relief, is a 
successor to the World war 11 American food relief programme in Europe. It is 
an institutionalised international transfer mechanism. (Raymend F.  Hopkins 
1984).

Food aid has since 1954 drawn criticism for its policies to create permanent 
food surpluses and the potential to create enmity and violation of liberal 
trade principles.

In 1979 a criticism that food aid depressed local food production by lowering 
prices paid to producers necessitated devices to prevent the perverse 
"disincentive" effects.

The other criticism was on the short term and unreliable quality of food aid. 
Political and market development objectives were not put into consideration for 
development of domestic food policy when negotiating for food aid.

Food aid critics want the food to be rationed for development ends and not 
expended for consumption that may even reduce pressure on governments to 
address rural development.

Dependency on food aid and subsidized grain undermines the political will 
needed to invest in domestic agriculture. The government does not have the 
imperative to develop its domestic food production. The problem undervalues 
local food production and remains unsustainable in the long run and short run. 
Food aid distribution conducted through relief pipelines undermines commercial 
supplies and livelihoods.

Food-aid offered in cash by donors to the beneficiary government and used to 
buy food grain locally or regionally stimulates local food production and farm 
gate prices. It promotes sustainability of future local food production and 
livelihoods. 


Food aid and Its Impact on livelihood sources and food security


As alluded to above agriculture is the main source of livelihoods in Malawi. 
This means that through agricultural production and trading employment and 
household income is realised for sustainability of the well being of Malawians. 
For example crop cultivation by smallholder farmers generate demand for seed 
and fertilizer from distribution companies and create employment and business 
opportunities for Malawians. Agricultural produce is sold to marketing agencies 
and processors who create employment for marketing staff, transporters and 
security employees. 

Food aid apart from the short-term life saving benefits has also the effects of 
price dampening because it creates temporal satisfaction and reduces food 
demand and market price. The low market price creates a disincentive to food 
producers. Investment decisions change in the production plans of the 
subsequent season in favour of cash crop production. 

The livelihood chain linked to the agricultural commodity gets under mined and 
collapse.  Food supplies decrease and food prices increase and become un 
affordable requiring further food aid. The WFP study (2002/2003EMOP Evaluation 
report) on the effect of food crisis interventions has in record that the 
availability of food aid under the EMOP contributed to excess stocks of maize, 
which undermined the sells of government commercial maize programme. Only 
37,000MT of maize got sold out of the total importation of 239,000MT. The 
stagnation in the Government commercial maize price and the apparent lack of 
movement in stocks, the price of maize from commercial traders declined over 
the period, leading to a general decline in food prices and on the overall 
consumer Price Index during the period. Maize prices dropped to levels below 
the cost of production i.e. MK10 per kg from MK17 per Kg. Food distribution 
livelihood activities suffered income loss.

However the evaluation results of the WFP-Emergency Operation (EMOP) 
intervention study conducted in June 2003 indicates that the provision of food 
aid yielded short term and unsustainable benefit results in addressing the 
problem of food insecurity. It enables beneficiaries to concentrate on 
production of subsequent food supplies or income generation livelihood source 
to access food on the market. Increased area of land was put under cultivation 
an achievement attributable to the fact that farmers had more time and strength 
to work in their fields since they did not have to go searching for casual 
employment to acquire food. 

Targeted HIV/AIDS infected and affected households mitigated the impact of the 
infection and eased labour demand for caring for the sick. The health 
deterioration was decelerated and labour supply increased due to improved 
nutrition. Livelihoods were enhanced.

At the peak of the food crisis from December to April, 2002 the common plea by 
food insecure households was for food aid and inputs to enable them plant their 
fields and gain strength to manage their filed crops after germination. 

Both men and women spent long hours fetching for food and casual labour (ganyu) 
for income to buy food from the market at the expense of caring for their 
crops. Increased frequency of funerals due to HIV/AIDS and hunger related 
deaths exacerbated demand for time and resources. Un traditional mass burials 
due to labour constraint to prepare traditionally accepted individual graves 
for burying the dead tolerated. Food aid eased the situation and enabled the 
observance of the traditional practices. The nutritional improvement reduced 
death rates and saved funeral labour there by enhancing people's livelihoods. 
Politicians claimed the food aid hand-outs to be a result of their efforts in 
order to gain political recognition.

Food aid prevented the depletion of people's livelihoods by allowing vulnerable 
people not to resort to erosive coping mechanisms, for example, sales of 
productive assets, migration for search for casual employment. Food aid 
strengthened social cohesion through food sharing mechanisms. Therefore food 
aid can enhance household food security if perceived to be a means to an end. 
Otherwise food aid promotes complacence and dependency and undermines 
livelihoods used as coping mechanisms. 

Food production subsidy is perceived to be the opposite of food aid. It 
promotes sustainable livelihood sources and has long-term benefits to 
beneficiaries. It employs the skills and labour of the beneficiary. Though it 
undermines established input distribution businesses in the short term it 
facilitates the sustenance and resurrection of collapsing livelihoods. 

------------------------------------------------------------------------ 

Ruchi Tripathi

Food Rights Policy Officer
ActionAid International UK
Hamlyn House 
MacDonald Road 
London N19 5PG 
Ph: 44 207 561 7560 

 


ActionAid's vision is a world without poverty in which every person can 
exercise their right to a life of dignity. Registered Charity No. 274467
www.actionaid.org.uk 

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