Malawi - Agricultural Sector Adjustment Program
Bown, Chad P.; Cowley, Meredith A.;
The primary objective of the Agricultural Sector Adjustment Credit Project is to support the Government's ongoing adjustment program to achieve sustainable growth, food security, and reduce poverty. To these ends, the credit will support measures aimed at reducing poverty through agricultural growth. Past adjustment operations helped to improve external and internal balances. To maintain the competitiveness of exports, the project will continue reforms to maintain a flexible exchange rate policy, improve export incentives, and expand trade liberalization. The credit will also continue reforms to ensure adequate producer incentives and improve marketing efficiency, by expanding the role of the private sector. The project will support new policy changes to address the key structural constraints in agriculture by: (a) shifting the research policy and budget to develop high-yielding maize varieties; (b) changing laws to allow smallholders to grow high-value cash-crops, burley tobacco, and increase prices of smallholder tobacco; (c) halting the transfer of land from smallholder areas to estates; (d) improving fertilizer use and distribution efficiency; and (e) improving land use efficiency in estates. The project will also support further new initiatives to: (a) improve efficiency in agricultural public expenditures; (b) implement pilot schemes to develop ways of targeting fertilizer subsidies and credit to the poor; and (c) strengthen monitoring capabilities of the adjustment pro
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