A TIP from Malawi
Over the past two years, Malawi has observed strong harvests for agricultural crops. An estimate 2.2 million tons of maize is required, annually, for domestic consumption. Many here cite the fact that Malawi has become and exporter of maize, with 2.7 million tons of maize production in 2006 and 3.4 million tons in 2007. This compares favorably to the 1.2 million tons harvested in 2005. Additionally, tobacco markets have thrived this year, with the dollar value of sales more than double that of last year.
Recent discussion in Malawian newspapers points to the success of the Targeted Input Subsidy Program (TIP) as the cause for the boost in maize production. Using support from the World Bank, DfID, Norway and the European Union, TIP provides a subsidy coupon, nominally targeted at smallholder farmers, on the purchase of fertilizer and seeds. The price of fertilizer, with the coupon, drops from 6500 Kwacha ($46.43) to 900 Kwacha ($6.43). The program began after the 2005 crop failures. Approximately 1.5 million coupons have been distributed this year.
The program has generated quite a lot of attention from the donor community, neighboring countries, and academics. Jeffrey Sachs has adopted the cause of TIP to show that countries throughout Africa can take steps to realize a Green Revolution for the continent.
As a result of the successful crop seasons in recent years, international attention and praise has befallen President Bingu wa Mutharika and TIP. Back in December 2007, the New York Times published a Celia Dugger piece on TIP. Earlier this year, The Sunday Times (Blantyre) published an editorial by Glenn Denning and Jeffrey Sachs. Also, read a recent article by David Lepeska on the subject.
While it would be difficult to empirically establish causality between TIP and the bumper harvests of the past two years, it is equally difficult to convince oneself that this program has not positively affected the agricultural potential of smallholder Malawian farmers. Questions remain, however, as to whether or not the program can hold up politically without becoming excessively wasteful, whether the program will help to build the private fertilizer marker and innovation in seed technologies, and whether the program can sufficiently hold off the negative effects of a yet-to-come drought (as seen in 2005).
