Malawi’s controversial Integrated Production System (IPS) of growing tobacco, popularly known as contract farming, comes under heavy scrutiny today [Thursday] by tobacco experts who intend to ascertain the benefits being accrued from the new tobacco marketing system.
The tobacco conference, organised by the Economics Association of Malawi (Ecama), will bring together key stakeholders in the tobacco industry, agriculture academia, government, tobacco industry players and grower representatives.
However, the conference comes at a time when there is a continued ‘tug of war’ between proponents and opponents of the new tobacco marketing system which has been subjected to intense national debate by key and concerned stakeholders.
The system approved by former president Joyce Banda in May 2012 and made official on June 21 2012 when she attended the 25th annual congress organised by the Tobacco Association of Malawi (Tama).
And the three-year-old system, which sees buyers offering farmers necessary inputs, extension services and loans, ensures that 80 percent of tobacco is sold through IPS with the remaining 20 percent sold under auction system.
It generally provides for contract farming of tobacco and direct facilitation of growers by processors and buyers.
According to Ecama, an announcement of the conference, IPS sets in motion a number of obligations between the grower and contractor aimed at enhancing the benefits of the relationship between growers and tobacco companies.
The association observes that during the two years of its introduction, tobacco buyers and government have remained optimistic that IPS is the necessary change needed if Malawi is to continue producing tobacco sustainably.
“In view of the strategic importance of tobacco to the Malawi economy, the Ecama conference offers an opportunity for stakeholders to look at the progress of IPS and contract farming and to plot an effective future for the tobacco industry together,” said Ecama.
However, Business Review has learnt that dust is refusing to settle in the wake of embracing IPS, with AHL Group—which handles both auction and contract systems challenging government to fine-tune the system and not just rush to implement the ‘imported’ concept.
On one hand, other tobacco grower bodies such as Malawi’s second largest tobacco grower grouping, Phindu Tobacco Growers Association, told Business Review two weeks ago that now it fully supports the system as it is benefiting most of its members.
Ironically, the association had earlier sued Joyce Banda administration for approving IPS.
During the recently-ended sitting of Parliament, some legislators denounced IPS saying it is fast impoverishing tobacco growers in the country.
But two weeks ago, Minister of Agriculture, Irrigation and Water Development Allan Chiyembekeza backed IPS saying it is improving the quality of tobacco in the field.