Issue paper
Assessing the Policy Environment for Cash Crops in Malawi: What Could Hinder the Achievement of the National Export Strategy Objectives? FAO Agricultural Development Economics Working Paper 17-02
This paper examines the main issues affecting producers of export crops in Malawi that could compromise the attainment of the National Export Strategy (NES) 2013-2018 targets. The analysis assesses the level of policy support to the major export crops (cotton, groundnuts, sugar, tea and tobacco) for the period 2005-2013, by calculating the Nominal Rate of Protection (NRP), the Nominal Rate of Assistance (NRA) and the Market Development Gap (MDG) indicators for producers and by analysing public expenditure targeting the aforementioned commodities. The results show that trade and market policies resulted in disincentives of -15 percent on average for cash crop producers mainly due to poor infrastructure, lack of competition, weak enforcement and/or inefficiency of producer price policies, and limited budgetary support to cash crops value chain development. The analysis offers further evidence to guide the prioritization of policies and investments in view of fully attaining the NES objectives, including facilitation of farmers’ access to markets, promotion of a more competitive environment for agri-business, and development of a transparent market information system.
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