LILONGWE-(MaraviPost)- A 2017 World Bank assessment of poverty in Malawi, shows that rural poverty continues to persist with one in two people still poor.
The Bank attributes the persistent poverty levels 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 Bank on Thursday, launched the two documents at a function held in Lilongwe.
These are the Malawi Economic Monitor and Poverty Assessment. The main objective is to give give the authorities and the public an appreciation of Malawi’s development agenda.
In the statement made available to The Maravi Post, the Bank’s shows that the assessment finds 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.
The Bank observes that despite an average 2.4 percent growth per year in GDP per capita, for most of the period between of 2004 to 2013, Malawi’s GDP was significantly more volatile than other African countries.
It adds that issues that contribute 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.
“To reduce poverty, the World Bank proposes 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,” says the Bank.
Beyond agriculture, the Bank says, there is need to facilitate movement into new, and more remunerative non-farm activities. Access to credit, backed by a functioning individual identity (ID) system and deepening financial inclusion m, through mobile banking, could catalyze this movement.
The Bank further recommends upgrading skills, promoting entrepreneurship, integrating value chains, and reducing costs of logistics.
On social protection, the assessment proposes reforming existing safety net programs, to help protect incomes and assets of the poor against shocks.
“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 value of the assets created through public works, should also be evaluated to determine if they are valuable. If not, consider removing the condition to work to get cash,” the assessment advises.
The assessment also recognizes the importance of managing population growth in the fight against poverty, and recommends 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.
Since 2010, very little progress has been made in reducing poverty in rural areas, where most of Malawians live, and was worsened by the floods in 2015 and the large-scale drought in 2016/17.
The latest (3rd) Integrated Household Survey estimates, the poverty headcount in Malawi at 50.7 percent, which is a worrisome development.