Economists and agriculture stakeholders have faulted President Peter Mutharika’s stance to maintain the Farm Input Subsidy Programme (Fisp) in the next five years despite calls to have the programme abolished.
In his State of the Nation Address (Sona) during the opening of the First Meeting of the 48th Session of Parliament in Lilongwe on Friday, the President, despite acknowledging challenges that have rocked the programme over the past years, said Fisp will not stop.
Mutharika said he welcomes suggestions on how the multi-billion kwacha programme can be improved.
“We will, however, continue finding ways to make the programme more efficient and sustainable. I want more of our poor farmers to benefit. I want the programme to benefit those which it targets,” said Mutharika.
But agricultural expert Tamani Nkhono-Mvula, in an interview on Sunday, said maintaining Fisp in the current form is not right.
He said the programme needs to be reformed.
He observed that Fisp is not benefiting the poor nor is it economical.
“The calls to do away with Fisp have not been on the fact that to subsidise the poor is bad, but a subsidy has to be transformative.
“We have to see an improvement of life after the subsidy and on that basis, Fisp has failed,” said Nkhono-Mvula.
Catholic University dean of Social Sciences Gilbert Kachamba said Fisp is a waste of resources, stressing that the programme was a good short-term strategy to deal with food shortages.
“It has now become a long-term political strategy and we are wasting a lot of resources with Fisp producing an output of a lesser value.
“It is even cheaper to buy maize and distribute for free than what we spend under Fisp,” he said.
Economics Association of Malawi (Ecama) president Chikumbutso Kalilombe said government would do well to take into consideration the concerns raised on Fisp to make it more effective and also contain the cost.
Two weeks ago, International Food Policy Research Institute (Ifpri) faulted huge investments in Fisp, arguing it has discouraged diversification into higher-value or more nutritious crops.
In her reaction to Ifpri findings, National Smallholder Farmers Association of Malawi (Nasfam) chief executive officer Betty Chinyamunyamu said the report relates with the Malawi situation because most of the policies and incentives have targeted production for food security, especially maize.
Since 2005, Malawi has invested about K398.6 billion in Fisp, an equivalent of a third of the K1.3 trillion 2018/19 National Budget and nine percent of the country’s nominal gross domestic product (GDP).