Social commentators have accused the Malawi government of deliberately killing the once powerful grain trader, the Agricultural Development and Marketing Corporation (ADMARC), by withholding K23 billion it owes the parastatal institution as the politically connected Kokoliliko Holdings has set up cooperatives by the smallholder farmers to gain competitive advantage.
Kokoliliko’s head Daud Suleman told Times TV on Saturday the Malawi Congress Party (MCP) linked investment company with 13 directors, has set up 460 cooperatives throughout the country and that it willl be providing markets for smallholder farmers and play a coordination function in the quest for wealth creation and productive investments in rural Malawi.
Suleman said the cooperatives will also evolve into a commercial bank subject to approval by the Reserve Bank of Malawi.
Admarc – which remains the most viable and trusted agricultural market for millions—even those in hard-to-reach remote communities has been playing a diminishing role in agricultural markets.
The grain marketer’s acting Chief Executive Officer, Felix Jumbe, conceded that Admarc’s main shareholder, (government) has continued to allow the company’s assets to be abused and stripped.
He said Admarc is facing “liquidity problems”, stating that it is one of the factors contributing to the poor performance at the corporation.
Jumbe told Nyasa Times last week that the corporation needs close to K300 billion to bring the operations of Admarc back to those cherished old days when the institution led in grain trade.
“If government could pay us the K23 billion it owes us, we could have somewhere to start from. But with the longstanding debt, most of our operations have now been paralysed,” he said.
Chairperson for the Parliamentary Committee on Agriculture, Ulemu Chilapondwa, said his committee will lobby members of Parliament (MPs) to consider allocating adequate resources to Admarc.
Chilapondwa added that the committee wants to propose that the National Food Reserve Agency (NFRA) should stop buying maize and that the role should be given to Admarc only to avoid duplication of work for the two institutions.
“For a long time, Admarc has been a strategic grain trader for agro-produce. It’s very important that we should give adequate resources so that it functions effectively and efficiently,” he said.
But the Centre for Social Concern (CfSC) executive director Father James Ngahy argued that the solution to revitalize ADMARC lies in the depoliticization of the institution so that it improves its performance and be able to pull smallholder farmers out of abject poverty.
Ngahy said it is high time ADMARC started working to benefit all Malawians unlike in the past decades when it used to serve the few ‘political zealots’.
The Catholic priest expressed disappointment that, over the two and half decades, influential politicians and a few politically-connected businesspeople have held the institution at ransom at the expense of the larger good.
“Admarc must be run by professionals. Politicians should not be involved in Admarc using it as a tool to siphon money from people. Admarc must stand for the benefit of all Malawians, and not few political zealots. With a reformed Admarc, all Malawians will appreciate and benefit from Admarc performance,” said Ngahy.
He observed that failure by Admarc to buy maize from smallholder farmers is a major contributing factor to the national food insecurity and deepening levels of poverty.
Ngahy said the government will be violating people’s rights to food if it does not reform the institution, adding that the efficiency of Admarc could help to increase food security and reduce poverty in the country.
“We are very worried that smallholder farmers sweat a lot to produce, but at the end of the day, they sell at a very low price. And at the end of the year, they have nothing to eat. That means they have to go to the very same vendors they sold their produce to where they now buy at a very exorbitant price. This has exacerbated the deepening of their poverty levels; hence, we are asking the government to change this status quo by bringing back the old Admarc that used to serve all people; and not, a few political zealots,” emphasized Ngahy.
“If the belly is empty, even the thinking becomes very low. That’s why we want to encourage Admarc to do better so that farmers can benefit from their labour and have enough to eat at all times so that they can enjoy that dignity of life. In the current set up, it is difficult to advance transparency and accountability at the institution. We think there should be a system which can be used to balance-check the activities of Admarc so that very few people that want to hold it, for instance politicians or other politically-connected powerful people, are not allowed to manage the operations of the corporation,” he added.
A local agriculture expert, Tamani Nkhono Mvula, said there is a need for Admarc to develop a marketing strategy that can help in operationalizing the National Agriculture Investment Plan (NAIP) and consolidating collaboration among the actors involved in the agriculture marketing development in the country.
Mvula also asked the government to develop a clear reporting line of the Chief Executive Officer (CEO) of the institution, stressing that the current one is problematic and a recipe for confusion.
He observed that currently, the Admarc CEO reports to the board of the institution, the Minister of Agriculture and lastly the Statutory Corporation.
“Some of these things could also bring confusions in terms of how the management is supposed to operate. I gave an example of the maize-gate. There were some decisions, which were made, but the board itself was surprised that those decisions were made because the Minister of Agriculture had a direct say on the operations of Admarc, bypassing the board itself,” he said.
However, Mvula stated that Admarc can only be depoliticized if the government authority over the institution is reduced.
“As long as the government maintains 99 percent of shareholding in Admarc, then we still have a big problem,” said Mvula.
A policy specialist Blessings Chinsinga in a presentation titled ‘Admarc in Contemporary Malawi: A Political Economy Analysis’, argues that government needs to consider Admarc reforms as an integral part of the broader rural transformation agenda through joined up policy formulation processes to ensure consistency across related interventions.
With research bemoaning increased encroachment of Admarc by politicians, Chinsinga calls for the need to insulate the operations of a reformed Admarc from unnecessary political interference so as to ensure that its activities remain focused on its core functions and mandates.
He also proposes the establishment of an independent board of management of a reformed Admarc that reports directly to Parliament.
Chinsinga also challenges civil society organisations to closely monitor the activities of a reformed Admarc to ensure that it does not get distracted from its core functions and mandates.Follow and Subscribe Nyasa TV :