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Private Sector Participation in the Farm Input Subsidy Programme in Malawi

FAC Policy Brief 58
by Ephraim W. Chirwa and Andrew R. Dorward
July 2013

The Farm Input Subsidy Programme (FISP) in Malawi has been implemented since the 2005/06 season with the objective of improving household and national food production and incomes. It targets more than 1.5 million farm families who receive subsidised fertilisers, improved maize seeds and/or legume seeds. The implementation of the FISP has involved the interaction of the Government of Malawi, the private sector, development partners, civil society organisations (CSOs), non-governmental organisations (NGOs), traditional leaders and smallholder farmers, all playing different roles in the implementation and success of the programme. The private sector has played a critical role, but its involvement in the programme has changed over time. This has included the procurement of fertilisers, the transportation of fertilisers to various markets, the retail sale of fertilisers, and the production and sale of improved seeds.

Benefits from the inclusion of the private sector in the implementation of a nation-wide agricultural input subsidy programme include efficiency, reduced bureaucracy, strategic development of the private market system, cost savings on the part of the Government, shared investment finance and costs, and reduction in displacement of commercial sales of inputs.