- Govt pays Zambia directly for maize
With only two months remaining to October when hunger is expected to start biting the country hard, government is yet to release $15 million (about K7.68 billion at the current exchange rate) to the National Food Reserve Agency (NFRA) for the purchase of maize locally and outside Malawi.
The delay will likely stifle efforts to avert hunger that threatens 2.8 million Malawians in 25 of the 28 districts of the country, according to the 2015 Malawi Vulnerability Assessment Committee (Mvac) report.
But Treasury has said there is no need to panic as it is doing everything possible to ensure that the agency has enough resources to purchase the commodity.
NFRA chief executive officer (CEO) Nansinuku Saukira, in a response to a questionnaire, said the equivalent of $15 million government is expected to release to his agency is part of $80 million (about K40.96 billion at the current-exchange rate) government is expected to get from the World Bank under the Malawi Floods Emergency Response Project (MFERP).
Saukira said: “The NFRA will use this money to purchase maize from suppliers from within and outside the country through two auctioning platforms, namely the Agricultural Commodity Exchange for Africa (ACE) and the AHL Commodities Exchange Limited (AHCX).”
The NFRA CEO said the process has just started, adding the first auction took place on July 14 2015 followed by a second one on July 16 2015 at ACE and AHCX respectively.
He said deliveries would follow.
Saukira said NFRA hopes to procure at least 50 000 metric tonnes with the $15 million.
“We have about 35 000 metric tonnes in the Strategic Grain Reserves. The process has just started. It is too early to say there are challenges. Let us wait until the process gathers momentum,” he said when asked if there were any challenges.
But a source at NFRA said the delay to release funding to the organisation was crippling the process of procuring maize, and that what was more worrying was that this was the prime time for maize procurement when farmers had just harvested.
The source said it was important to ensure that the $15 million from the World Bank is released as soon as possible to enable the agency to go flat out procuring the commodity.
He feared the maize price would keep going up more especially when some farmers were hoarding the maize to make a killing when hunger hits hard.
But Ministry of Finance spokesperson Nations Msowoya said apart from the World Bank agreement where NFRA will be getting some money, Treasury paid Zambia’s Food Reserve Agency (FRA) K4 billion for importation of maize.
Msowoya said: “This is just additional funding government decided to make because this was emergency, we had to do something to cover up while waiting for the process [with the World Bank] which was not yet complete.”
Msowoya said it was easier for the Reserve Bank of Malawi (RBM) to make the direct payment to Zambia’s FRA than channeling money through NFRA, which he said was going to take more time.
Revelations by Civil Society Agriculture Network (Cisanet) and government that the country will experience a 30-40 percent drop in harvest on the back of drought and floods in selected part of the country, prompted government to start searching for the commodity in neighbouring Tanzania and Zambia where it wanted to buy 70 000 metric tonnes and 30 000 metric tonnes respectively.
While the Zambian maize has been trickling in, there is not yet movement on the Tanzanian front.
According to Mvac report, the 25 affected districts are Balaka, Blantyre, Chikwawa, Chiradzulu, Chitipa, Dedza, Dowa, Karonga, Kasungu, Lilongwe, Machinga, Mangochi, Mchinji, Mulanje, Mwanza, Mzimba, Neno, Nkhotakota, Nsanje, Ntcheu, Phalombe, Rumphi, Salima, Thyolo, and Zomba.