Category: Business

The Famine Early Warning Systems Network (FEWS NET) monitors trends in staple food prices in countries vulnerable to food insecurity. For each FEWS NET country and region, the Price Bulletin provides a set of charts showing monthly prices in the current marketing year in selected urban centers and allowing users to compare current trends with both five-year average prices, indicative of seasonal trends, and prices in the previous year.

Maize, rice, and cassava are the most important food commodities. Markets selected represent the entire geographic length of the country: two markets in each of the north, center, and south. In the north, Karonga is one of the most active markets in maize and rice and is influenced by informal cross-border trade with Tanzania. Mzuzu is a major maize producing area in the northern region. Salima, in the center along the lake, is an important market where some of the fishing populations are almost entirely dependent on the market for staple cereals. Mitundu is a very busy peri-urban market in Lilongwe. In the south, the Lunzu market is the main supplier of food commodities such as maize and rice for Blantyre. The Bangula market in Nsanje district was chosen to represent the Lower Shire area, covering Chikwawa and Nsanje districts.

Source: Famine Early Warning System Network

The African Development Fund, the concessional window of the African Development Bank Group, has approved a $20.2 million grant to raise food production in Malawi.

Part of the African Development Bank Group’s African Emergency Food Production Facility, the project is premised on the existing seed and fertilizer distribution systems in Malawi. It will provide half a million farm households with 2,500 tons of climate-smart certified cereal and legume seeds, and 70,000 tons of fertilizer. A guarantee scheme managed by the African Fertilizer Financing Mechanism will reach 300,000 farmers.

Each registered farming household will receive two 50 kg bags of fertilizer for basal and top dressing, respectively, and a choice of 5 kg of hybrid and fast-maturing maize, rice, and sorghum seeds. For legumes, farmers will have the option to choose either a 2kg bag of groundnuts and beans or 3 kg bags of soybean, cowpea and pigeon pea.

In partnership with the Technologies for African Agricultural Transformation program, 1,000 extension staff will receive training in climate-smart agriculture and farm data collection methodologies using new technology. To assist with this, 300 motorbikes will be procured.

Three hundred electronic tablets will be distributed to officers who collect data from farmers’ clubs. Around 700,000 new beneficiaries will be registered on the database of the government’s Affordable Inputs Program, which will implement the project.

Malawi has been significantly impacted by the Russia-Ukraine crisis, causing a spike in fuel and food prices and a foreign exchange shortage. The disruption of international trade has impacted both import and export market prices of various commodities, including fertilizer, whose prices per bag have tripled to Kwacha 90,000 ($75) by May 2022, from Kwacha 30,000 ($25) a year ago. Other imports affected are wheat, fuel (pump prices have increased by 40%), machinery, and other intermediate goods.

Agriculture plays a key role in Malawi’s economy, contributing about 30% to gross domestic product and 75% of export earnings. Roughly 90% of crops are cultivated by smallholder farmers who rely on fertilizer.

Source: African Development Bank

For Sinoya Kenayala, a 30-year-old farmer in Malawi, land is everything. It is life, legacy and much more. His 1.2 hectare farm in the Kalonga suburbs of the capital, Lilongwe, is his best shot at providing sustenance and a stable life for his four children. Yet, like many farmers and communities dependent on land, the threat of persistent and rapid land degradation is always looming.

The recently published Global Land Outlook 2 by the United Nations Convention to Combat Desertification (UNCCD) warns that between 20 and 40 percent of the Earth’s total land area has suffered some form of degradation. This affects nearly half the world’s population and spans croplands, drylands, wetlands, forests, and grasslands. Yet the burden falls disproportionately on smallholder farmers like Sinoya, rural communities, women, young people, Indigenous peoples, and at-risk groups.

Land degradation in Malawi has been the result of steady demands for settlement, unsustainable agriculture, and rapid deforestation, exacerbated by climate shocks. Lilongwe, the capital, is now prone to prolonged dry spells. Less rainfall is diminishing agricultural yields and land productivity, pushing young people from villages to towns in search of jobs.

It’s having widespread economic, social, and environmental consequences. The estimated annual cost is about US$320 million, almost seven percent of the country’s GDP.

The economic effects of the COVID-19 pandemic have been harsher on vulnerable farmers who are entirely reliant on rain-fed agriculture for a steady income. In Sinoya’s case, the escalating prices of food and other household needs, combined with a lack of business opportunities, proved very costly.

Restoring degraded land could be the key to building back better from COVID-19. Focusing on land restoration and sustainable land management practices, improving soil and crop health, connecting natural areas; these all can bring green jobs, ensure sustainable livelihoods, guarantee food security, and reduce the risks of future pandemics.

These practices can act as valuable carbon sinks in the fight against climate change. Studies show that Malawi forests can help remove up to 16 percent of the country’s total carbon emissions.

Recognizing this urgent need, and in line with the Sustainable Development Goal target 15.3, the Government of Malawi has committed to achieving land degradation neutrality by 2030, rehabilitating one million hectares of degraded land for crop production and restoring 820,000 hectares of native forest.

UNDP, through its Biodiversity and Ecosystems Services Network (BES-Net) project and its Malawi country office, engages young entrepreneurs like Sinoya in land restoration activities across the three districts of Lilongwe, Dedza and Salima. BES-Net, which is supported by the Government of Germany and SwedBio, brings together scientists, policymakers, and practitioners including local communities to implement tangible biodiversity solutions with knowledge and evidence provided by UNCCD, IPBES, and other sources.

UNDP is channeling seed funds to the Malawi Green Corps, a flagship initiative of the Ministry of Forestry and Natural Resources to train more than 2,000 young people in land restoration, with a focus on sustainable livelihoods.

Village Natural Resource Committees choose young entrepreneurs through local youth clubs. They galvanize communities to share ideas and act on issues of environment, forestation and health.

Forty five percent of the entrepreneurs are women.

Sinoya set up his agricultural enterprise in 2020, with support from the Forestry Department. He was selected in 2021 as one of the entrepreneurs to undergo the training provided by the Malawi Green Corps.

Selling tree seedlings such as acacia, mahogany, mkukhu, and albizia versicolor, among others, Sinoya would usually make about US$3 a month. However, now expanding to sell to schools, non-governmental organizations and government officers, he is making about US$490.

“This work has given me new skills on how to better manage and care for tree seedlings. I have learnt how to establish nurseries more effectively and how to keep my business running.”

Members of the Malawi Green Corps received training in high-quality tree planting and care, seedling care, native plant species conservation and other aspects of business such as entrepreneurship and financial literacy. These skills have been helping youth access green jobs and grow green enterprises focused on land restoration and climate adaptation.

Malawi was one of the countries that participated in BES-Net’s Regional Trialogue for Anglophone Africa bringing together partners from science, policy and practice to share knowledge, create solutions and commitments around the themes of pollinator conservation, land management and food security.

Yuko Kurauchi, Policy Specialist at UNDP’s Global Policy Centre on Resilient Ecosystems and Desertification, recognizes the value that young people bring.

“The land degradation crisis is often less prioritized when compared with other unfolding global crises, yet this intersects with biodiversity loss and climate change in very complex ways and has direct implications for our food security, livelihoods, health, well-being and more.”

Engaging youth and investing in youth-run green enterprises in sustained land restoration efforts is crucial to making communities resilient. Malawi’s efforts can serve as inspiration for other countries in the region and globally and also to establish a collective global vision for our future.

And for Sinoya, this is just the start of something bigger. The seedling sales are bringing in a steady income which he has used to improve his house and farm and invest in livestock.

He also grows beans, maize, and groundnuts. Through what he is learning and with the support of the Malawi Green Corps, he aspires to establish more nurseries and invest in parallel sources of income such as sustainable beekeeping and goats.

“As a youth volunteer in the initiative, I have learnt new skills on better managing tree seedlings and establishing nurseries, thereby boosting my business skills. Tree survival rates are surely going to improve based on this new understanding. We have always been planting trees but now I’m seeing better ways that we have overlooked before.”

Source: UN Development Programme

The U.S. government, through the U.S. Agency for International Development (USAID), announced the launch of Let Them Grow Healthy (Tiwalere) in Malawi today. Tiwalere is a five-year, $46 million initiative, subject to appropriations, in support of the Government of Malawi’s National Multi-Sector Nutrition Policy. It is anticipated that USAID will invest $23 million and that the private sector will match this by also contributing $23 million.

This alliance of for-profit corporations, non-governmental organizations, and USAID aims to improve the health of Malawians, particularly adolescents, pregnant and lactating women, and children by expanding quality nutrition, maternal and child health, water and sanitation, and malaria program coverage. A focus of the project will be pregnancy through a child’s second birthday, when good nutrition and health care are critical for growth and development. The initiative will support local care groups and communities to produce a local, nutritious fortified food product that would be distributed through a sustainable, market-based approach.

Malawi has achieved dramatic gains in most health indicators over the past decade by focusing on improved delivery of essential health services. With support from the U.S. government, Malawi has made significant progress in child health, reducing mortality for children under age five by 50 percent and malaria-related mortality by 43 percent since 2010. USAID partners with the Government of Malawi to continue addressing these challenges.

Source: US Agency of International Development

The African Risk Capacity Group and the African Development Bank make a $14.2 million drought recovery insurance payout to the Government of Malawi

JOHANNESBURG 29 June 2022 — In a ceremony presided over by His Excellency, the President of the Republic of Malawi, Dr Lazarus McCarthy Chakwera, the Chairperson and Deputy Chairperson of the African Risk Capacity Group, in the presence of Representatives of Partners organisations (Ambassador of Germany to Malawi), and of the UN system (WFP and UNDP country directors), delivered a symbolic US$14.2 million insurance payout cheque to the Malawi Government.

*”I assured Malawians that we have enough food for everyone and even those few whose crops had not done well would be provided for. My confidence came from the fact that we had taken this insurance policy to support Malawians in time of need. And I want to thank the ARC Group for honouring the agreed payout,” *said His Excellency, Dr Lazarus McCarthy Chakwera, President of the Republic of Malawi.

The Government of Malawi had a drought insurance policy, supported by the African

Development Bank through its Africa Disaster Risk Financing (ADRiFi) Programme Multi-Donor Trust Fund. Many regions of Malawi, particularly the Central and Southern regions, are experiencing severe food insecurity caused by drought-related events like erratic rainfall and crop failure.

The Governments of the United Kingdom, through the Foreign, Commonwealth and Development Office, and Switzerland, through the Swiss Agency for Development and Corporation contributed to the ADRiFi trust fund. The Government of Germany, through KFW Development Bank/Federal Ministry for Economic Cooperation and Development, as well as the International Fund for Agricultural Development subsidized Malawi’s insurance policy premiums.

During the 2020/21 season, the country experienced an unprecedented dry start to the production season, leading to higher rates of sowing failure in significant parts of the Southern and the Central Regions as modelled by Africa RiskView, the African Risk Capacity Group’s (ARC) risk modelling and early warning tool. This, combined with mid-season erratic rainfall conditions in most parts of the country resulted in a modelled number of people affected estimated at about 6.4 million, the second-highest number of affected people, since 2001.

*”ARC’s drought insurance mechanism is an innovative pan-African tool that provides our member states with the funds needed to better plan, prepare and respond to climate-related disasters,” *said ARC Group Board Chairperson, Dr. Anthony Mothae Maruping. *”The payout to the Government of Malawi will not only release pressure on public finances but it will also bring nutritional and financial support to those that have been affected by the droughts caused by an increasingly variable and changing climate,” *he added.

*”Malawi is a signatory of the ARC Treaty and a key partner in the region. We have no doubt that the funds disbursed will support the country in scaling up its response to the drought-induced challenges,” *said United Nations Assistant Secretary-General and ARC Group Director General, Ibrahima Cheikh Diong.

*”ARC’s drought insurance product ensures the swift release of funds when they are needed most, allowing them to be channelled effectively to respond to a crisis. The most vulnerable in the country, who are facing severe hunger, will now have access to food relief,” *declared Lesley Ndlovu, CEO of ARC Limited, the insurance affiliate of the ARC Group.

Source: Government of Malawi

TAIPEI — Chinese President Xi Jinping pledged this week to help advance four economic powers, despite pandemic problems at home and knock-on effects from Russia’s war in Ukraine. Analysts expect the pledges to take time, with no immediate results.

Xi made his remarks Thursday at the virtual BRICS Summit hosted by Beijing.

The other countries are Brazil, Russia, India and South Africa, which together with China make up the grouping known as BRICS. These large emerging economies see themselves as an alternative to the U.S.-led world order.

The leader of China advocated BRICS cooperation in cross-border payments and credit ratings, the official Xinhua News Agency in Beijing reported Thursday. The report says he further recommended “facilitation” of trade, investment and financing.

Xi as host of the group’s 14th summit said he would work with the BRICS countries to support global development that is “stronger, greener and healthier,” Xinhua added.

The leader urged more countries to join the New Development Bank, a concessional lender founded by BRICS countries in 2015. He called, too, for improving the group’s emergency balance-of-payments relief mechanism, the Contingent Reserve Arrangement, Xinhua added.

View toward future deals

Substantive progress on these goals will likely take time, analysts say, as the member countries do not always get along with one another and China’s ambitions may take time to evolve given issues at home and abroad.

“At the highest level, there’s a little bit of a discussion, then that may lead to further opportunities to be further engaged down the road,” said Song Seng Wun, a Singapore-based economist in the private banking unit of Malaysian bank CIMB.

China’s economy has outgrown the others after decades of export manufacturing for much of the world. But the keeper of a $17.5 trillion GDP has teetered this year amid lockdowns to contain a COVID-19 surge — which snarled world supply chains originating in China.

BRICS member Russia faces economic sanctions from the West over its war in Ukraine, which has sparked food shortages and inflation. China still faces tariffs on goods shipped to the United States, fallout from a bilateral trade dispute.

India and China have their own differences. The world’s two most populous countries contest sovereignty over mountain territories between them, and China bristles at India’s geopolitical cooperation with the West.

Developing countries, including those among the BRICS, can easily turn to Japan, the European Union and other alternatives to China for economic support, said Stuart Orr, School of Business head at Melbourne Institute of Technology in Australia. Those choices will slow China’s ambitions to sow BRICS cooperation as developing states prefer not to over-rely on Beijing, he said.

“There’s a lot of talk but probably not so much real progress in that regard and I suspect things will probably end up sort of getting pushed back to the next BRICS meeting for further progress once the dust has settled,” Orr said.

China still “struggles with health issues” while its historic political rival the United States is finding new suppliers and customers for soy exports, Orr said.

Officials in Beijing want to expand cooperation with other countries as the United States sanctions Russia over the war and China over trade, said Huang Kwei-bo, associate professor of diplomacy at National Chengchi University in Taipei.

The BRICS countries might reassure one another over energy and food shortages linked to the war, Song said. Later, he said, they could “flesh out” substantive agreements.

Anti-West position

China regularly offers economic aid, investments and COVID-19 vaccines to friendly developing countries from Africa into Central Asia. Its flagship is the Belt and Road Initiative, a 9-year-old, $1.2 trillion list of foreign infrastructure projects aimed at opening China-linked trade routes.

Chinese officials feel the BRICS nations will welcome their support, and in turn, accept some of their political views, analysts say. Of the BRICS states, only Brazil voted against Russia’s invasion of Ukraine at the United Nations earlier this year. China, India and South Africa abstained.

India, despite its West-leaning political activity and reservations about China’s Belt-and-Road, still takes Russian oil.

“India-China relations are very sensitive, but outside these existing relations, like in the Caribbean and Latin America, those spots are where India and China wouldn’t have clashes of interest,” Huang said.

Brazil in particular is looking for more international support to overcome the “devastating impacts” of COVID-19 in the country, Orr said.

“There should be some other countries that would think about joining this kind of regime,” Huang said. “Then, if a lot of those countries don’t have such good relations with the U.S. side, doesn’t that mean it’s one more thing causing a headache for the United States in terms of geopolitics?”

A declaration issued at the summit Thursday says the five countries support talking further about expanding their group.

Source: Voice of America