The budget presented on Friday by Minister of Finance Economic Planning and Development Joseph Mwanamvekha promised to bring prosperity to farmers through a series of targeted interventions, from improved market access to access to credit and slashed the fertilizer prices from the current K22 000 per 50 kilogram bag to K5 000.
Mwanamvekha also disclosed that the President Peter Mutharika administration will maintain the targeted Farm Input Subsidy Programme (Fisp) if retained in power with
beneficiaries now at 1 million where vulnerable people will get free fertilizer and seeds.
He said each farmer will pay K5 000 per 50 kilogram bag.
In the same programme, government has also taken an ambitious move targeting100 000 vulnerable people, including elderly farmers and child-headed families, who will get free fertilizer and seeds.
The opposition Malawi Congress Party (MCP) and UTM Party, are pledging for a universal subsidy for a bag of fertiliser to be K4 500, but government argues that is counterproductive as s rural farmers will be exploited by unscrupulous traders.
Government fear universal subsidy would create a fertile ground for private agri-based traders to exploit rural farmers.
In his budget presentation, Mwanamvekha told Parliament that in the 2020/2021 fiscal year, the allocation to FISP has been increased from K35.5 billion spent in 2019/2020 fiscal year to K38.4 billion.
“This has resulted into an increase of the targeted farm families from 900,000 to 1.0 million.
“Madam Speaker, out of the targeted farm families, 900,000 will benefit from Government subsidy.”
He explained that that on average, each farmer pays K5 000 only per 50-kilogram bag of fertilizer. In addition to that farmers will get almost free hybrid seed.
“Furthermore, Madam Speaker, the other 100,000 of the 1.0 million beneficiaries will receive free fertilizer and hybrid seed. The free farm inputs will be given to the most vulnerable people in our communities such as the elderly, child-headed- families and people with disabilities, details of which will be covered in the Ministerial statement by the Honourable Minister of Agriculture and Food Security,” he said.
The country’s purse keeper said in the 2020/2021 fiscal budget, K10.0 billion has been allocated for maize purchases by the National Food Reserve Agency and ADMARC to restock the Strategic Grain Reserve.
“The restocking of the Strategic Grain Reserve is already underway using resources from the 2019/2020 fiscal year.
“In addition, a total of US$8.4 million, which is equivalent to K6.3 billion from the World Bank is also available for maize purchase,” said Mwanamvekha.
The Finance Minister said government’s target is to stock 220,000 metric tons of maize in the Strategic Grain Reserve, being the minimum requirement for the SGR.
“Furthermore, Madam Speaker, ADMARC will be allowed to borrow from financial institutions to purchase additional maize stock, cotton and legumes. The amount to be borrowed will be based on assessed financial capacity of ADMARC to repay,” he said.
He said government is committed to achieving household and national food security goals.
Mwanamvekha said the 2020/2021 budget has been developed under the theme “Economic Recovery, Mitigation and Building Resilience”Follow and Subscribe Nyasa TV :