World Bank invests $166 million in Malawi’s agriculture
The World Bank has approved $166 million to transform Malawi’s agricultural productivity through irrigation, lay the foundations for commercialization, and improve management of natural resources in the Shire Valley.
The financing is for the first phase of the Shire Valley Transformation Program (SVTP-I). The funding consists of a $160 million credit from the International Development Association*, and a $5.59 million grant from the Global Environment Facility Trust Fund.
The whole program, which will cover the Chikwawa - Nsanje areas of the Shire Valley, is scheduled to have three phases over a 14-year period (2017-2031). Through this period, the program will provide irrigation to over 40,000 hectares by gravity water delivery, eliminating the need for electricity for pumping water from the Shire River. The program will boost agricultural production, provide drinking water services, improve sustainable management of natural resources including wetlands and protected areas, while enhancing tourism potential.
“The rewards for this program will indeed be transformational for Malawi’s agriculture and the national economy,” said Joseph Mwanamvekha, Malawi’s Minister of Agriculture, Irrigation, and Water Development. “The beauty of the whole program is that it will engage the smallholder farmers to modernize and commercialize agriculture. We ultimately anticipate a half billion-dollar benefit to the economy.”
SVTP-I will mainly deliver well-constructed, professionally managed, and financially sustainable irrigation services, and support services in agriculture, aquaculture and livestock production. It will help farmers secure land and water tenure, and assist them in developing commercial farming. In preparation for commercialization, the farmers will get support in land administration, farm organization, marketing, and access to financial services. The SVTP-I will also support diversification to crops other than sugarcane which the Shire Valley is well known for. This is expected to create more opportunities for agro-processing enterprises and traders.
“We trust that through this project, Malawi’s agriculture will go beyond the food security agenda to commercial agricultural investments that will sustainably pull people out of poverty,” said Valens Mwumvaneza, World Bank Acting Country Manager for Malawi. The Bank estimates a significant improvement in income levels of beneficiary households by overcoming the main challenges of droughts and floods in the Shire Valley region.
Implementation of the project will be led by the Ministry of Agriculture, Irrigation, and Water Development with other partners and agencies. The SVTP-I is scheduled to close in 2023.
