Poverty worsen in Malawi, headcount at 50.7%: World Bank suggest pathways to prosperity

The third Integrated Household Survey done by the National Statistics Office  has estimated that Malawi’s poverty headcount is at 50.7 percent.

Malawi is one of the poorest countries in the world and more than half of its 15 million people live below the poverty line.

The Wold Bank, citing NSO survey, said in its 2017 assessment of poverty in Malawi released on Thursday afternoon revealed that rural poverty continues to persist in the country with one in two people still poor, pointing out that since 2010, very little progress has been made in reducing poverty in rural areas where most of Malawians live, and is likely worsened by the floods in 2015 and the large-scale drought in 2016/17.

The bank has attributed the continued rural poverty to volatile economic growth, poor performance of the agriculture sector, high population growth, limited opportunities in non-farm activities, and inadequate safety nets within a context of high economic insecurity.

The assessment finds that poor performance of the agriculture sector which is the backbone of the country’s economy and on which more than 80 percent of the population depends, has contributed to the marginal decline of poverty over the years.

“Factors that have impeded agricultural growth include weather variability, declining soil fertility, limited adoption of improved agricultural technologies, inadequate provision of extension services, and restricted access to markets,” read in part the assessment which Nyasa Times has a copy.

The bank noted that despite an average 2.4 percent growth per year in GDP per capita for most of the period between 2004 and 2013, Malawi’s GDP was significantly more volatile than other countries in Africa.

“Issues that contributed to this volatility include macro-economic instability and large scale weather shocks such as droughts and floods that hit the country in recent years. These difficult conditions hit the poor harder.”

Meanwhile to reduce poverty, the bank has proposed a number of actions in the agriculture, financial and social protection areas, in addition to creating conditions for macroeconomic stability.

“Since agriculture is key, the assessment recommends raising the labor incomes of the poor through increasing the productivity of agriculture. This could be done through expanding access to new technologies to boost yields, scaling back the farm input subsidy program and focusing its objective on increasing productivity.

“Beyond agriculture, there is need to facilitate movement into new, more remunerative nonfarm activities. Access to credit backed by a functioning individual identity (ID) system and deepening financial inclusion through mobile banking could catalyze this movement. The Bank further recommends upgrading skills, promoting entrepreneurship, integrating value chains and reducing costs of logistics,” further reads the assessment.

On social protection, the World Bank has proposed to government to reform existing safety net programs to help protect incomes and assets of the poor against shocks, saying this could be done by giving the poor larger and well-directed transfers, scaling up unconditional cash transfers, enhancing the insurance role of the public works program to build responsiveness to large weather shocks and improve its targeting performance.

The bank has also proposed the need to have the value of the assets created through public works to be evaluated to determine if they are valuable, and if not, government should consider removing the condition to work to get cash.

The assessment recognized the importance of managing population growth in the fight against poverty and recommended expanding female secondary education and access to family planning by poor adolescents to reduce child marriage and early childbearing.

In Malawi, women with a secondary education have low levels of fertility at 3.6 births per woman compared to 6.9 for those with no education or incomplete primary education.

The 2017 poverty assessment was done from a combination of three analytical reports produced by the World Bank. These are The Malawi Poverty Assessment, the policy report Pathways to Prosperity in Rural Malawi, and the Poverty and Social Impact Analysis of the Farm Input Subsidy Program.

In Malawi alone, a 2015 study by Oxfam titled A dangerous Divide: The state of inequality in Malawi revealed that an estimated 9.5 million people will live in poverty by 2020 up from 8 million people in 2015.

Malawi’s gini-coeficient —a measure of the extent of distribution of income—jumped from 0.39 in 2004 to 0.45 in 2011.

Malawi’s poverty rate has been worsening in the past three years, captured at almost 70 percent as of last year, the recent World Bank reports in its recent bi-annual Malawi Economic Monitor publication.

The publication puts into perspective Malawi’s economy by monitoring trends to help guide policy interventions and economic planning.

The poverty rate had dropped to 69.3 percent in 2014 from a peak of 70.1 percent the previous year but since then there has been an upward surge to reach 69.6 percent, showing the country is losing the battle against poverty which the bank says is striking half of the rural population.

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Apao Kugola
Guest
The report as presented in this forum seems to comprehensively present critical issues affecting the country. On the agricultural front however, I have this to add: mere increase in productivity cannot improve smallholder farmers’ income. Efforts aimed at improving productivity of the agricultural sector especially smallholder farms should move together with improving important institutions which help to enhance rural farm incomes. Such institutions like proper marketing of agricultural commodities are a necessary prerequisite for attainment of improved farm income. On this feat, there should be a proper mechanism to ensure that the produced farm commodity is not snatched by vendors… Read more »
lukempumila
Guest
I will sight on entrepreneur ship, apart ft the usual cry on lack of capital,the other silent hindrance factor to us young entrepreneurs is the high cost of rentals in urban centres. most of these buildings in our cities are owned by foreigners, they charge rent per square meter in us dollars,on average most buildings in the city centre in Lilongwe will require you to pay mk800,000 monthly rental on a quarterly basis,plus one month rental ad surity.thus On your first day of occupying a room you will need a whooping mk3,200.000. now think of furniture’s and fittings,another two million… Read more »
chatonda Mvula
Guest

This has not come as a surprise because Dr Chakwera has been telling the nation the same message but government through their spokespersons have been elusive and refusing to accept the reality. I hope they will now believe what Dr Chakwera was saying and concede that APM has failed the nation bug time. Shame on all those dunderheads who defend what they do not know. They will be answerable one day.

gwenyethe
Guest

In Malawi you can feel, smell, see, hear and even taste poverty. As much as every individual is expected to work to reduce their own poverty but the people entrusted to create conducive environment for reducing the same have not applied themselves fully. How on earth would you grow when someone else is busy draining the small gains that we have achieved as a country? And some leader keeps on defending them. We are not serious with matters of development of the country. As long as we smile to corruption next time the head count will be at 60%.

bwana wankulu
Guest

common you blackies
BLAME THE INDIANS.
AMWENYE CHAKUTI CHAKUTI……….
YOU CANT RUN A COUNTRY AND ARE F*****G YOUR OWN PPL UP

Mmalawi
Guest

Hopefully Hon Dausi is preparing to reject these findings and attribute them to the opposition, cashgate, etc

Panganani
Guest
The definition of insanity is continuously doing the same thing but hopeful of getting a different result. Malawi continues to elect into office thieves and rogue leaders. As a country, we believe in laziness -hoping that we will get some breakthrough without working hard. We continue to think that by practicing tribalism, we will progress through our tribal connections when there is power in diversity. We are a people that are full of deep jealous against each other’s progress such that we would go to a great length to bring others down. We believe in pretending that we are religious… Read more »
Karani
Guest

They seem to have interviewed flies too. Why is it not presenting good progress?

mtete
Guest

And yet a few individuals like Chaponda can afford to stash away millions of kwachas in their homes Some can even spend millions buying popularity.
The report says the downward trend has been very noticeable since 2010. We know who has been in the Driving Seat: DPP

Kent Y.G. Mphepo
Guest
A very sad revelation but nothing new really. Food for thought for everyone who loves this country. The country has not moved forward for too many years now and yet some people want us to believe that the country is developing. Malawians, we have wasted our time for too long. We always blame it on our weather, our history (one party), our ….. etc. But the truth is that we are not serious with anything. The country is moving backward. Food for thought. Let’s begin to have serious-minded leaders. This is my honest take. Kent Mphepo – Blantyre.
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