The World Bank, European Union (EU) and the governments of Ireland, Norway and Flanders Wednesday signed a $45 million (about K80 billion) additional financing agreement with the Government of Malawi for the second Agriculture Commercialisation (Agcom II) project.
With the additional financing, the total amount for Agcom 2 rises to $326 million.
World Bank Country Manager for Malawi, Firas Raad, said that the additional resources come from two specific sources: a Multi-Donor Trust Fund backed by the EU, Norway, Ireland and Flanders in support of agricultural activities in Malawi, and the World Bank-administered ‘Food Systems 2030 Global Trust Fund’.
The fund aims to build the foundation for sustainable food systems that deliver improved livelihoods alongside safe, affordable and nutritious diets for all.
Raad said Agcom 2 is a central component of the bank’s engagement in Malawi and seeks to position agri-business – alongside other programmes such as the Shire Valley Transformation Programme – as a key driver of economic prosperity, job creation and poverty alleviation over the coming decades.
“It is also well aligned with the development goals of Malawi’s National Agriculture Policy, its Agriculture, Tourism and Mining Strategy and Malawi 2063, [the long-term development plan].
“This additional financing will scale up existing Agcom II activities focused on the commercialisation of agricultural products, the development of climate-smart irrigation systems and the integration of digital solutions to improve productivity,” he said.
The World Bank official added that the financing will also support activities aimed at reforming agricultural subsidies and boosting the resilience of the country’s national food system.
He further said that only through investments in developing modern irrigation systems and enabling commercialised farming can Malawi hope to break out of its enduring food insecurity trap.
“These investments will also help position the sector for greater development impact by driving up exports, generating more foreign exchange, improving fiscal revenues and creating much-needed jobs for the country’s burgeoning youth population,” Raad said.
EU Ambassador to Malawi, Rune Skinnebach, said that Agcom represents a new flagship initiative for the EU in Malawi, which demonstrates the bloc’s continued commitment to growing Malawi together.
“It aligns with our broader Team Europe commitment under the Global Gateway Strategy, supporting agriculture, energy, education and other key sectors,” Skinnebach said.
He added that, beyond Agcom, the EU has been investing in transformative agricultural initiatives, promoting economic growth, environmental sustainability and social development.
According to Skinnebach, since 2022, the EU has partnered with the European Investment Bank on the Kulima Access to Finance project, unlocking €25 million to empower agribusinesses.
“More recently, we have started the Uchi programme (Greening and Growing Malawi), with a budget of €26.7 million, dedicated to connecting farmers to markets and seizing value-added opportunities to increase profitability and business continuity in five value chains.
“Uchi seeks to develop vibrant markets while preserving natural resources and enhancing nutrition security,” the envoy said.
Minister of Finance Simplex Chithyola said the additional financing is a testament to the achievements and impact the Agcom project is making on the ground, which calls for scaling up efforts to benefit more Malawians.
“We are glad that our partners have responded to this call by bringing in more resources, meaning that they, too, are fully supporting the agricultural commercialisation agenda,” Chithyola said.
President Lazarus Chakwera, on November 16, 2023, launched the Agcom II project, which seeks to transform smallholder farming into commercial agriculture.
Agcom 2 follows what is described as the successful implementation of Agcom 1, which was implemented to the tune of $95 million from the World Bank.
0 Comments