Revitalizing Malawi’s Agriculture Sector: A Catalyst for Economic Growth

Key Business Points

• Prioritized spending and strengthened oversight in agriculture programs are crucial for achieving productivity, boosting exports, and creating jobs for the youth in Malawi.
• The government needs to transition from broad subsidies to targeted investments that directly support agricultural transformation, ensuring that resources reach smallholder farmers and agribusiness operators efficiently.
• Performance-based budgeting and improved fiscal discipline are essential for implementing reforms that can unlock faster productivity growth and create more resilient rural incomes in Malawi’s agriculture sector.

Malawi’s government and regional experts have emphasized the need for smarter investment in the agriculture sector, which contributes about 25 percent to the country’s gross domestic product (GDP) and remains the backbone of the economy. According to Ministry of Finance, Economic Planning and Decentralisation Principal Secretary Patrick Zimpita, agricultural transformation is key to ensuring food security and economic growth, particularly for the youth, who make up over 70 percent of the population. To achieve this, the government has introduced new public financing instruments, such as the National Economic Empowerment Fund and mega-farm initiatives, aimed at unlocking private capital and providing youth with access to skills, finance, and markets.

The recent regional policy dialogue on value for money in agricultural value chains, convened by the Collaborative Africa Budget Reform Initiative (Cabri), highlighted the need for better coordination between key ministries overseeing the agriculture sector. Cabri public finance management specialist Winnie Mageto noted that Malawi, like many African countries, struggles with fragmented coordination, duplication of duties, low budget execution, and limited private sector engagement. The dialogue aimed to help governments implement performance-based budgeting, improve fiscal discipline, and ensure that resources reach smallholder farmers and agribusiness operators efficiently.

Experts, including a representative of the Kenya Government, Peter Iwoko, advised Malawi to focus investments on value chains that drive transformation, balancing food security needs with market-driven diversification. Iwoko emphasized the importance of making credit accessible to farmers when they need it, rather than after the season has passed. Policy analysts pointed out that Malawi spends more on agriculture but continues to face food insecurity and low export competitiveness due to weak implementation, delayed financing, and minimal value addition.

The World Bank projects that reforms aimed at improving spending efficiency, irrigation expansion, and agro-processing can unlock faster productivity growth and create more resilient rural incomes. Delegates at the policy dialogue recommended reforms to strengthen oversight, reduce fiscal leakages, and channel more resources into high-impact agricultural investments. As Malawi’s economy is agro-based, with 25 percent of its GDP coming from the sector, it is essential for the government to prioritize zinthu zofunika (relevant things) and kulima kwa mpango (planned farming) to ensure the sector’s growth and development. By doing so, Malawi can unlock its full potential and create a more prosperous future for its citizens.

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