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Malawi Cuts Out Suppliers from Fertilizer Subsidy Program

Some Malawian businessmen and the Indigenous Businesspersons of Malawi (IBAM) have criticized the decision of the government not to involve suppliers in this year’s Farm Input Subsidy (Fisp) program, claiming that the move will trigger corrupt and illegal practices and help politically connected individuals. In lieu of calling for transporters and suppliers for the supply of Fisp seed and fertilizer in the 2015/2016 growing season, there will be no farmers and suppliers handling dealers directly, Ministry of Finance spokesperson, Nations Msowoya, said. In other words, government will not be inviting bids from firms to provide subsidized farm inputs and transport them to a number of sellers nationwide.

Mr. Msowoya said that the government was spending a substantial amount to pay transporters and suppliers, which incurs major costs. He further commented that “the government was subcontracting companies to supply fertilizer and pay them for the fertilizer that has been supplied. This has been stopped. This time all dealers will be able to handle fertilizer subsidy coupons.” Mr. Msowaya also explained that “What would be needed is for the beneficiaries to take their coupons to the dealers.”

According to the ministry, the arrangement will enable some in remote areas to access the subsidized farm inputs because the majority of agro-dealers are situated in trading centers. However, opponents say that although the idea seems to be good, targeted farmers will not benefit from the program because not many agro dealers have the capacity to stock and supply the farm inputs. IBAM President, Mike Mlombwa, further explained that “the decision to take out suppliers was not done in the best interest of Malawians, but elite few Malawians with political connections”. Mr. Mlombwa also suggests that farm inputs will not be distributed evenly throughout the country but will benefit mostly politically-linked farmers and agro-dealers.

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