Malawian farmers have the prospect of better storage facilities for their grain harvest and improved access to credit, thanks to €30 million worth of support from the European Investment Bank (EIB),
The EIB and the National Bank of Malawi (NBM) have recently announced this opportunity for agricultural projects in Malawi. USAID and ACE (Agricultural Credit Enhancement project) are also involved in developing the programme, which will enhance access to finance for private sector companies and support agri-storage projects.
The projects include storage capacity for agricultural commodities, certified under a warehouse receipt system (WRS) which would be made available to third parties.
“The approach is intended to stimulate a wider inclusion of farmers in the national WRS under which farmers can use warehouse receipts as collateral, to enhance access to financing,” stated a joint press release from the EIB and the NBM.
Win-win for farmers and authorities
The two banks also hope that farmers and the government will benefit from improved management, storage and food security.
“The lack of agricultural storage facilities has been an issue for the development of the agricultural sector in Malawi,” said Robert Schofield, head of the EIB’s Global Partners’ finance division. “The EIB facility aims to address this issue to the benefit of farmers and the Malawian authorities by improving market transparency and providing information for a more efficient agricultural policy.”
Cut back on loss
According to Dr George Partridge, CEO of the NBM, the planned agro-storage assets will “greatly reduce post-harvest losses in Malawi and help to improve national development”. Partridge said the project would give smallholder farmers access to quality grain storage facilities, with 30% of the storage space available to smallholder farmers participating in the WRS, offered by the Agricultural Commodity Exchange.
According to the African Post Harvest Losses Information System of Monitoring Agricultural Resources, the country loses almost a quarter, or 23%, of its maize crop, primarily because of the lack of proper grain storage facilities.