You are on page 1of 111

R APE ING P RK WO ALAWI M

Global Donor Platform for Rural Development

About the Platform Knowledge Piece series


The Global Donor Platform for Rural Development commissioned three comprehensive studies to capture Platform members knowledge on key issues affecting the delivery and impact of aid in ARD: PKP 1 PKP 2 PKP 3 Policy coherence for agriculture and rural development Aid to agriculture, rural development and food security Unpacking aid flows for enhanced effectiveness The strategic role of the private sector in agriculture and rural development

The PKPs are the products of extensive surveys of Platform member head office and field staff, visits to country offices, workshops dedicated to sharing findings and refining messages, and successive rounds of comments on drafts. On the basis of each PKP, separate policy briefs will be published. For more information on the PKPs visit donorplatform.org

This working paper is only available electronically and can be downloaded from the website of the Global Donor Platform for Rural Development at: www.donorplatform.org/resources/publications Secretariat of the Global Donor Platform for Rural Development, Dahlmannstrasse 4, 53113 Bonn, Germany Email: secretariat@donorplatform.org The views expressed herein are those of the authors and do not necessarily represent those of individual Platform members. All rights reserved. Reproduction and dissemination of material in this information product for educational or other non-commercial purposes is authorised, without any prior written permission from the copyright holders, provided the source is fully acknowledged. Reproduction of material in this information product for resale or other commercial purposes is prohibited without written permission of the copyright holders. Applications for such permission should be addressed to: Coordinator, Secretariat of the Global Donor Platform for Rural Development, Dahlmannstrasse 4, 53113 Bonn, Germany, or via email to: secretariat@donorplatform.org. Global Donor Platform for Rural Development 2011

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

Contents
Contents.......................................................................................................................................................... 1 List of figures, boxes and tables ................................................................................................................... 3 Acknowledgements ........................................................................................................................................ 5 Acronyms and abbreviations ......................................................................................................................... 6 Executive summary ........................................................................................................................................ 9 Aid measurement and reporting systems and definition of aid to ARD&FS .......................................... 9 Composition and trends of aid to ARD&FS ............................................................................................. 10 Assessing the quality of aid measurement and reporting in the ARD&FS sector ............................... 10 Introduction .................................................................................................................................................... 1 Background to the study ............................................................................................................................ 1 The Malawian context ................................................................................................................................ 2 Aid measurement and reporting systems and definition of aid to ARD&FS ............................................... 5 GoM aid measurement and reporting systems ........................................................................................ 5 Aid Management Platform ..................................................................................................................... 5 Public Sector Investment Programme .................................................................................................. 7 ............................................................ 8 Linkages between systems .................................................................................................................... 9 Dono ................................................................................... 11 Internal .................................................................................................................................................. 11 One UN .................................................................................................................................................. 11 Donor coordination on agriculture and food security) ....................................................................... 11 Climate Change, Environment and Agriculture Joint Resilience Unit .............................................. 11 Definition of the ARD&FS sector ............................................................................................................. 12 ...................................................................................................... 12 ............................................................................................................................... 21 Issues to be considered for definition and tracking of aid to ARD&FS ................................................. 24 Agriculture for economic growth......................................................................................................... 24 Governance and decentralisation ........................................................................................................ 24 Natural resource management and climate change ......................................................................... 24 Infrastructure for agricultural and rural development ...................................................................... 25 General budget support ....................................................................................................................... 25

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

Cross-cutting issues: gender, nutrition and HIV ................................................................................ 25 Comparison with ODI definition ........................................................................................................... 26 Overview of aid flows to ARD&FS ................................................................................................................ 27 Volumes of aid resources ........................................................................................................................ 27 Main sources of aid to ARD&FS .............................................................................................................. 37 Aid instruments and modalities .............................................................................................................. 37 Current and future trends in donor support .......................................................................................... 40 Assessment of the quality of aid information ............................................................................................. 41 Accessibility, accuracy and comprehensiveness of data on aid to ARD&FS ........................................ 41 ........................................... 42 Mutual accountability and results focus ................................................................................................. 45 Alignment of data provision with government planning and accounting requirements...................... 47 Donor harmonisation ............................................................................................................................... 48 Examples of good practice .......................................................................................................................... 50 Conclusion .................................................................................................................................................... 52 References.................................................................................................................................................... 55 Annex 1: ARD&FS definitions used in this study ........................................................................................ 58 Annex 2: Sector profile matrix ..................................................................................................................... 64 ...................................................................................... 64 Institutional structure of the ARD&FS sector ........................................................................................ 66 Ministry of Agriculture and Food Security .......................................................................................... 66 Other ministries and public institutions .............................................................................................. 67 Non-state actors ................................................................................................................................... 67 Public expenditures in ARD&FS .............................................................................................................. 69 Annex 3: Overview of ARD&FS policy framework over last 2 decades ..................................................... 72 Annex 4: Tables with detailed aid data........................................................................................................ 76 Annex 5: List of key informants interviewed .............................................................................................. 84 Annex 6: Format used to report to MoF on ODA (GoM, 2010b) .................................................................. 87 Annex 7: Templates used to register or update a project in the PSIP database ...................................... 93 Template to register project ................................................................................................................... 94 Template for finance and status update ................................................................................................. 95 Annex 8: Reporting format used to report to MoAFS database ................................................................. 97

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

List of figures, boxes and tables


Figure 1: Evolution of Ministries between 1990 and 2010 ......................................................................... 15 Figure 2: Aid flows to ARD&FS by type of sector definition (1990-2008) (in million USD) ....................... 30 Figure 3: Share of flows to ARD&FS in total aid flows (1990-2008) .......................................................... 31 Figure 4: Share of aid to ARD&FS in total donor-funded development budget (Part I) ........................... 32 Figure 5: Aid flows to ARD&FS by area of focus (1990-2008) (in million USD) ......................................... 33 Figure 6: Donor-funded development budget by Ministry (1990-2008) (yearly average, %) .................... 35 Figure 7: Main APPM categories in terms of aid flows (1990-2008) (in million USD) .............................. 34 Figure 8: Aid flows to main Rural Socio-Economic Development (1990-2008) (in million USD) ............. 36 Figure 9: Aid flows to main Emergency Relief and Welfare categories (1990-2008) (in million USD) .... 36 Figure 10: Main donors in the Agriculture sector ...................................................................................... 37 Figure 11: Use of Country Systems ............................................................................................................. 39 -2005) ...................... 64 Figure 13: Growth in Agricultural Exports, 1971 - 2007 ............................................................................ 66 Figure 14: Management Structure of the ASWAp ...................................................................................... 68 Figure 15: Trends in Agricultural Sector Expenditure 1980 2009 .......................................................... 69

Figure 16: Share of types of flows in total aid to ARD&FS over 1990-2008 (%)........................................ 80 Figure 17: Aid flows to ARD&FS from Germany, UK, US, World Bank (1990-2008) (in million USD) ..... 82

Box 1. Malawi Growth and Development Strategy. ...................................................................................... 3 Box 2. Development Assistance Strategy. .................................................................................................... 6 ..................................................................................... 12 Box 4. Current ODA flows to Malawi. .......................................................................................................... 27

Table 1: Comparison of AMP, PSIP and MoAFS database ........................................................................... 9 Table 2: MoF Budget classification in Theme, Sub-Theme and Sub-Sub-Theme for relevant areas..... 13

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Tab

............................................................................................. 17

Table 4: Classifications used by different systems and policies in ARD&FS sectors .............................. 20 Table 5: Key priorities of on-going support from main donors to the ARD&FS(*) sector ....................... 22 Table 6: Current volume of ARD&FS aid by sector definition and source of data (2008) ......................... 28 Table 7: .......................................................... 43

Table 8: Growth Trends in Agriculture Sector Output (1990-2009) ........................................................... 65 Table 9: Composition of Export Earnings by Main Commodity (percent), 1990 - 2009 ............................ 65 Table 10: Agriculture Sector Government Spending Trends, 1990 - 2009 ............................................... 70 Table 11: Agricultural budget by sub-sectors (1999/2000 to 2006/07) ..................................................... 70 Table 12: Annual programme spending (1999/00-2006/07) ...................................................................... 71 Table 13: Total aid to ARD&FS by sector definition in constant values (1990-2008) ................................ 76 Table 14: Aid to ARD&FS by areas in constant 2000 values (1990-2008).................................................. 76 Table 15: Aid to ARD&FS by type of flow (1990-2008) ................................................................................ 79 Table 16: Main donors to ARD&FS (1990-2008) ......................................................................................... 81 Table 17: USAID Malawi commitment and disbursement data from 2001 to 2009 .................................. 83

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

Acknowledgements
We would like to extend our gratitude to every donor, government and civil society representative for the time they dedicated to this study, as well as the valuable information and insights they provided during interviews and related email correspondence. We would also like to thank Edwin Kanyoma and Sarah Tione from the Ministry of Agriculture and Food Security for helping us to get a hold of several national and agricultural policy documents, including those dating back to the 1990s. We are particularly grateful to Aaron Batten and Mark Miller for going out of their way to provide us with data and clarify various budgeting and reporting processes. Finally, we greatly appreciate the constant backstopping and support received from Geraldine Baudienville throughout the study, as well as the constructive comments received from her and Lidia Cabral on an earlier draft. Michelle Remme Samuel Mingu

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

Acronyms and abbreviations


ADD ADMARC AfDB AFF ALDSAP AMP APPM ARD&FS ASWAp BADEA CAADP CDC CIDA CISANET CPIA CPPR CRS DAC DAD DAS DCAFS DEVPOL DFA DFID DP DRM EDF EPA EU FAO FICA Agricultural Development Division Agricultural Development and Marketing Corporation African Development Bank agriculture, forestry and fisheries (OECD-DAC) Agricultural and Livestock Development Strategy and Action Plan Aid Management Platform agricultural production, processing and marketing agriculture, rural development and food security agriculture sector-wide approach Arab Bank for Economic Development in Africa Comprehensive Africa Agriculture Development Programme Centers for Disease Control and Prevention Canadian International Development Agency Civil Society Agriculture Network Country Policy and Institutional Assessments (IDA) Country Portfolio Performance Rating (IDA) Creditor Reporting System (OECD) Development Assistance Committee (OECD) Debt and Aid Division (Ministry of Finance) Development Assistance Strategy Donor Coordination Group on Agriculture and Food Security Second Statement of Development Policies data focal agent Department for International Development, United Kingdom development partner disaster risk management European Development Fund extension planning area European Union Food and Agriculture Organization of the United Nations Flemish International Cooperation Agency

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper FISP GBS GDP GIZ GoM ICEIDA IDA IFMIS IGA ILO IMF IRD JICA JRU M&E MEJN MGDS MoAFS MoDPC MoF MoIWD MoIT MoLGRD MoNREE MPRS NGO ODA ODI OECD OPC PAF PD PFM Farm Input Subsidy Programme general budget support gross domestic product Deutsche Gesellschaft fr Internationale Zusammenarbeit (Germany) Government of Malawi Icelandic International Development Agency International Development Association Integrated Financial Management Information System income-generating activity International Labour Organization International Monetary Fund integrated rural development Japanese International Cooperation Agency Climate Change, Environment and Agriculture Joint Resilience Unit monitoring and evaluation Malawi Economic Justice Network Malawi Growth and Development Strategy Ministry of Agriculture and Food Security Ministry of Development Planning and Cooperation Ministry of Finance Ministry of Irrigation and Water Development Ministry of Industry and Trade Ministry of Local Government and Rural Development Ministry of Natural Resources, Energy and Environment Malawi Poverty Reduction Strategy non-governmental organisation official development assistance Overseas Development Institute Organisation for Economic Co-operation and Development Office of the President and Cabinet Performance Assessment Framework Paris Declaration public financial management

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper PIU PSD PSIP SAP SBS SWG UN UNDAF UNDP UNESCO UNICEF UNIDO UNFPA UNHCR USAID WFP WHO United Nations Industrial Development Organization United Nations Population Fund United Nations High Commissioner for Refugees United States Agency for International Development World Food Programme World Health Organization project implementation unit private sector development public sector investment programme structural adjustment programme sector budget support sector working group United Nations United Nations Development Assistance Framework United Nations Development Programme United Nations Educational, Scientific and Cultural Organization

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

Executive summary
The country studies are part of a larger study on understanding aid to agriculture, rural development and food security (ARD&FS). Their main purposes are to assess the quality of aid data and identify best practices in measuring and accounting for aid to ARD&FS. The quality of aid data is assessed against the main purposes of aid measurement which include: (i) transparency and accountability (vis--vis international, donor-country or recipient-country constituencies), (ii) internal management at the donor-agency level, (iii) country planning and financial management and (iv) analytical purposes (including assessing efficiency and effectiveness of aid). This report presents the main findings of the case study on Malawi based on a review of the existing documentation on ARD&FS, data on flows of official development assistance (ODA) to Malawi and interviews conducted in Lilongwe between 4 and 15 April 2011. While key informants provided invaluable qualitative information, quantitative data on ODA flows to ARD&FS over the 20-year period under review were more difficult to gather, mainly due to time constraints, limited institutional memory, the inadaptability of existing information systems to produce aggregate data and/or the weak information management systems in place, particularly for data more than five years old. l. Over the past two decades, the country has experienced recurrent food crises and, despite recent improvements, is still suffering from chronic malnutrition. In this context, the domain of ARD&FS has received considerable attention from government, non-governmental organisations (NGOs) and donors alike. With foreign aid representing 11% of gross domestic product, 30% of the national budget and 60% of the development (capital) budget, Malawi can be considered an aid-dependent country.

Aid measurement and reporting systems and definition of aid to ARD&FS


In this context, the government and donors have recognised the critical need to manage and coordinate foreign-aid resources more effectively. Malawi therefore initiated its own aid data management systems in the mid-2000s, and these have already greatly facilitated tracking, budget planning and coordination of aid in general and in the ARD&FS domain in particular. The Aid Management Platform (AMP) was established in 2008 for tracking, reporting and analysis of aid. Housed in the Debt and Aid Division of the Ministry of Finance (MoF), AMP contains all programmes and projects funded by resident donor agencies, as well as their monthly disbursements, annual projections, lead implementing agency and sector, type of funding and alignment to country systems. The MoF produces annual Aid Atlas reports, which include analyses of aid volumes, modalities, predictability and fragmentation, per donor and per sector. All 28 resident donors are reporting to the MoF in a timely and accurate manner, enabling the database to currently capture 837 programmes and projects across the 16 sectors, implemented by 109 implementing agencies. The Public Sector Investment Programme (PSIP) is a tool to plan and manage the national development (capital) budget, in line with the Malawi Growth and Development Strategy (MGDS). strategic directions and links them to available financing mechanisms. The PSIP database consists of a list of investment programmes and projects funded by government-guaranteed loans, grants and own resources, in the form of five-year rolling plans. It currently contains 233 projects, funded by 25 external donors and implemented by 32 public institutions.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

10

The Ministry of Agriculture and Food Security (MoAFS) Technical Secretariat database was
developed in 2004, upon the request of the Food and Nutrition Security Joint Taskforce, in order to track who was doing what in Malawi in the area of food security and nutrition at project level. The purpose was for such a regularly updated database to serve as a basis for coordination and harmonisation in the sector. It currently contains 193 projects, funded and implemented by over 80 different donors and implementers.

Composition and trends of aid to ARD&FS


In order to assess the consistency between policies and aid allocations, the study used data on aid collected internationally over the past 20 years to analyse trends. Overall, the volume of aid to ARD&FS appears to have declined between the early 1990s and 2008, despite a slight upward trend since the mid-2000s. In relative terms, the proportion of total aid going to ARD&FS has also decreased, after a peak in 1992 (a year of severe drought in Malawi), but seems to be staging a slight comeback since 2004/05, when Malawi experienced another alarming food crisis. The data further reveal a heavy bias towards agricultural policy and administration and agricultural development, or more likely a tendency to cluster agriculture-related support under these generic purpose codes. The categories of emergency food aid, food security programmes and basic nutrition seem to explain most of the recent increase in aid. Other characteristics of aid, such as type of aid, aid modalities or aid recipients and implementers (government, NGO, private sector), have been less well captured in the existing data at international level. However, the data do illustrate the increasing importance of general budget support as a contribution to and the government of Malawi ( ) explicit prioritisation of agriculture for economic development.

Assessing the quality of aid measurement and reporting in the ARD&FS sector
Several strengths have been observed in each system, such as the very good accessibility of aid data (on line or upon request) and the accuracy of most of the disbursements and projections data provided, especially to AMP. Donors appear to have aligned themselves to the aid-data requirements of the GoM, providing monthly disbursements and annual projections, particularly for donors providing general budget support and sector budget support. As a result of this very good collaboration, the aid data in AMP are now being used for budget planning (including setting development budget ceilings) and cash management. Moreover, PSIP data are being used to analyse the consistency between MGDS priorities and development budget allocations (government- and donor-funded). Civil society has also taken up a key role in budget analysis and tracking to hold government accountable for its use of tax and donor resources. Nevertheless, there are still a number of remaining challenges in terms of handling aid data in general, and aid to ARD&FS in particular.

Different definitions : while AMP uses a narrow definition of the agriculture sector (excluding
land and natural resources, irrigation, integrated rural development, trade and nutrition), the MoAFS has recently adopted the agriculture sector-wide approach (ASWAp) framework, which embraces food security and nutrition, commercialisation and market development, sustainable agricultural land and water management and agriculture-related gender, HIV and climate-change issues. While donors in the agriculture sector are able to relate their internal

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

11

classification to the ASWAp definition, AMP remains the primary aid data management system and aid-effectiveness monitoring tool. Weak linkages between ministries and aid data management systems: as the three systems were set up with different purposes, resources and institutional homes, there has been a recognised lack of coordination. This has led to discrepancies between the National Development Budget produced by the MoF and the Ministry of Development Planning and PSIP, for example, which should be one and the same. Moreover, as similar data are currently being requested from the MoF and the MoAFS for their databases, there is a risk of a reduced response rate due to survey fatigue. Tracking aid channelled through NGOs and the private sector: although donors have an obvious incentive to fully report their aid disbursements to the sector, NGOs and the private sector have less incentive to do so. As a result, aid being channelled outside the public sector has proved extremely difficult to track reliably. The MoAFS database has succeeded in providing government and NGOs with information that they are interested in on almost all projects in the agriculture, food security, nutrition and natural resources domain. However, specifics on quarterly or annual aid disbursements and modalities are not available through this implementer-driven database. Tracking expenditures: it is a major challenge to track expenditures, as most donors do not receive reliable or timely expenditure data from their recipients. Efforts are now being made to link all donorIntegrated Financial Management Information System for such real time expenditure tracking. Limited use of data produced for government and donor planning: as the guiding investment framework for the sector, it is striking to note that the ASWAp only refers to PSIPlisted projects in its analysis of ongoing investments in the sector and not to the Aid Atlas analyses of aid effectiveness in the sector, nor its own sector-wide and more inclusive project disbursements to the sector, but rather by their own priorities (or areas of comparative advantage). Limited analysis of aid data (inputs) against development outcomes : although the MGDS Annual Reviews represent an attempt to link development inputs and outputs and thereby assess the effectiveness of the development strategy, the weakness of the MGDS monitoring and evaluation framework seems to be constraining these efforts. Furthermore, the focus in terms of aid effectiveness per sector tends to be on Paris Declaration process indicators, rather than on linking overall inputs to development outcomes and eventually impact.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

Introduction
Background to the study
The second Platform Knowledge Piece (PKP II) is focused on aid to agriculture, rural development and food security (ARD&FS). By analysing the past and present composition and trends in ARD&FS policy, the study looks specifically at the quality of aid measurement and investigates the extent to which aid data provide an accurate indication of policy priorities by donors and recipients and a useful basis for planning, accountability and analysis. This study attempts more specifically to answer the following questions: Do available aid data tell us enough about the policy priorities of donors and recipients in ARD&FS? Do they tell us enough about changing spending patterns within the sector? Is there evidence of good practice in measuring, tracking and accounting for aid flows to ARD&FS, in ways that strengthen coherence between policy, planning and resource allocation, and, as a consequence, enhance development effectiveness?

The country studies are part of this larger study and their main purposes are to assess the quality of aid data and identify best practices in measuring and accounting for aid to ARD&FS. The quality of aid data is assessed against the main purposes of aid measurement which include: (i) transparency and accountability (vis--vis international, donor-country or recipient-country constituencies), (ii) internal management at the donor-agency level, (iii) country planning and financial management and (iv) analytical purposes (including assessing efficiency and effectiveness of aid). The studies have been undertaken in three countries Malawi, Nicaragua and Vietnam selected for the significance of aid allocated to ARD&FS and for the variety of accounts they are expected to provide on the theme at hand. Additionally, four donor studies were conducted, reviewing in more detail the aid trends, policies and practices of the United Kingdom, the United States, Germany and the World Bank. This report presents the main findings of the case study on Malawi based on a review of documentation on ARD&FS, data on official development assistance (ODA) flows to Malawi and interviews conducted in Lilongwe between 4 and 15 April 20111 by Michelle Remme, Lead Researcher, and Samuel Mingu, Research Assistant. While key informants provided invaluable qualitative information, quantitative data on ODA flows to ARD&FS over the 20-year period under review were more difficult to gather, mainly due to time constraints, the inadaptability of existing information systems to produce aggregate data and/or the weak information management systems in place, particularly for data more than five years old. In addition, the institutional memory regarding the last two decades is wanting, both within donor institutions and government, due to high staff turnover. The study comes at a time when Malawi and its donors are reviewing important national policy frameworks and donor country assistance plans, meaning that some of the information related to definitions could change in the near future.

See list of key informant interviews in Annex 4.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper The paper is organised as follows:

This section sets out the rationale for the study and provides an introduction to the report and the Malawian context. Aid measurement and reporting systems and definition of aid to ARD&FS describes existing systems and mechanisms in place for collecting and accounting for aid data in Malawi and reviews more specifically the practices of the three selected donor agencies for this study, namely the Development (DFID), the United States Agency for International Development (USAID) and the World Bank.2 This section goes on to present the definitions of aid to ARD&FS used by the Government of Malawi (GoM) and its development partners. Overview of aid flows to ARD&F presents an overview of aid flows to ARD&FS based on data from the Creditor Reporting System (CRS) of the Development Assistance Committee (DAC) of the Organisation for Economic Co-operation and Development (OECD) and GoM aid and budget data, identifies trends and analyses the extent to which they are related to donor and government policy priorities. Assessment of the quality of aid informatio assesses the quality of aid information based on its availability, comprehensiveness and accuracy; the extent to which it enables improved management for results and aid effectiveness, notably through increased alignment of aid flows with stated priorities and country systems; improved donor harmonisation and strengthened mutual accountability between donors and the government, among donors and between the government and its citizens. Examples of good practic presents key lessons that can be learned from Malawi s experience on aid management and the evolution of ARD&FS, in the context of an aiddependent low-income country. The report concludes with a summary of key findings, successes and challenges derived from the analysis of Malawi aid flows to ARD&FS.

The Malawian context


Malawi ranks among the world's least-developed countries, at 164 out of 177 on the Human Development Index. About 40% of its population of 13.1 million live below the national poverty line. Moreover, 85% of Malawians live in rural areas with poor access to basic health and education services. Agricultural production is the mainstay of the economy and accounts for 39% of gross domestic product (GDP), 80% of total employment and over 80% of foreign-exchange earnings. While t crop, followed by tea and sugar, agricultural exports have remained undiversified, with little value addition. Until very recently, Malawi was characterised by chronic food insecurity and malnutrition, resulting from its dependence on rainfed agriculture, a growing population, declining soil fertility, land degradation and a high HIV prevalence rate, among others. In order to guide national development efforts, the GoM formulated the Malawi Growth and Development Strategy (MGDS) in 2006 (see Error! Reference source not found.), based on five hematic areas and six priorities, all of which were related to ARD&FS. Indeed, since independence

Although Germany was the fourth donor identified for detailed analysis, the German Government requested that the data collected in Malawi not be included in this study.
2

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

development resources, strategies and policies in Malawi have been heavily biased towards agricultural development and the MGDS is no exception. Since 2005, Malawi has experienced a considerable reduction in its poverty headcount, high real GDP growth rates (7.5% annually on average) and bumper maize harvests. Moreover, macroeconomic performance has been strong, largely due to sound economic policies and a good performance in the agricultural sector, as a result of the widely acclaimed Farm Input Subsidy Programme (FISP) and favourable weather conditions. In its development efforts, Malawi relies considerably on foreign aid, which represents 11% of GDP, 30% of the national budget and 60% of the national development (capital) budget (GoM, 2011a). In the agriculture sector more specifically, Malawi ranks fourth in terms of its agricultural aid dependency ratio (9.7%), measured as the ratio of agricultural aid to agricultural value added. In the 2009/2010 financial year, donors reported total disbursements to agriculture alone to the tune of US$90.4 million, compared with a total national budget allocation to the Ministry of Agriculture and Food Security (MoAFS) of US$235 million. Box 1. Malawi Growth and Development Strategy. The Malawi Growth and Development Strategy (2006 11) is the overarching operational medium-term strategy for the transformation of the country from being predominantly an importing and consuming economy to a manufacturing and exporting economy. It represents a policy shift from social consumption to sustainable economic growth and infrastructure development. Priorities: (i) Agriculture and food security; (ii) Irrigation and water development; (iii) Transport and infrastructure development; (iv) Energy generation and supply; (v) Integrated rural development; (vi) Prevention and management of nutrition disorders and HIV/AIDS. Themes: (i) Sustainable economic growth; (ii) Social protection; (iii) Social development; (iv) Infrastructure development; (v) Improving governance. Priorities within priorities (i) Agriculture and food security; (ii) Green-belt irrigation and water development; (iii) Transport, infrastructure and Nsanje World Inland Port development; (iv) Energy, mining and industrial development; (v) Integrated rural development; (vi) Public health, sanitation and HIV/AIDS management; (vii) Youth development and empowerment; (viii) Climate change, natural resources and environmental management; (ix) Education, science and technology.

Based on the interviews with donor representatives and the review of their country assistance plans, the current areas of focus of the top donors in supporting the ARD&FS sector can be classified into four main categories, which are fully aligned to the national agricultural strategy.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper 1.

2.

3.

4.

Agricultural productivity and diversification for household food security : in response to the overall low agricultural productivity, overdependence on rainfed production, low crop and livestock diversification and persistently high rates of malnutrition, donors are devoting their resources to food- and incomeFISP. Moreover, agricultural production outcomes are increasingly being linked to nutritional outcomes, requiring increased collaboration between the health and agriculture sectors, as well as various thematic experts within donor agencies. Agroprocessing, commercialisation and private-sector development: given that Malawi has made great strides in sustaining national food security from its own maize production, renewed attention is given to commercialisation and market linkages for economic growth and increased household incomes from agriculture. The development of high-potential value chains and access to finance are some of the approaches being adopted by donors. Natural-resource management and climate-change adaptation: with increasing international focus on climate change and persistent pockets of vulnerability to natural disasters (floods, droughts), donors in Malawi are investing in conservation agriculture and soil-fertility research for the purpose of mitigation. Vulnerability and disaster risk management: related to the first and third focus areas, donors are keen to address hunger and particular vulnerabilities through broad-based livelihoods, socialprotection and resilience interventions, such as social cash transfers.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

Aid measurement and reporting systems and definition of aid to ARD&FS


There are two main categories of aid reporting systems: the first comprises the government systems, which include both national and sectorreporting systems, This section focuses on the efforts that have been made to align various government and donor reporting systems, as well as their key strengths and achievements to date.

GoM aid measurement and reporting systems


Malawi has dependence on foreign aid, the government and development partners have recognised the critical need to manage and coordinate these resources more effectively. Moreover, aid delivery is highly fragmented, with 28 bilateral and multilateral donors and a number of emerging donors (e.g. Arab donors, China and India) who have only recently started providing aid for infrastructure-development projects in various sectors (roads, public works and transport; water and irrigation; education; health; democratic governance) (GoM, 2011b). The GoM has established databases and mechanisms in order to improve aid measurement, link its budget to the national development priorities and to map who is doing what and where for enhanced coordination and impact at sector level.

Aid Management Platform


The Aid Management Platform (AMP) was introduced in Malawi in 2008, with assistance from the United Nations Development Programme (UNDP) and the Development Gateway Foundation, to help overarching Development Assistance Strategy (DAS), formulated in 2007 to increase the efficiency and effectiveness of the mobilisation and utilisation of development aid for the achievement of the national development strategy (see Box 2). In line with the Paris Declaration (PD) principle of managing for results, the DAS stipulates the establishment of an aid management system as a major outcome to manage inputs and outputs towards PD targets. Prior to AMP, donors reported and updated planned and actual disbursements on a quarterly basis through an Excel template developed in 2005 by the Ministry of Finance (MoF). Although the exchange of data between the government and in-country donors was good, the Excel-based system had reached its technical limits. Basically, the Debt and Aid Division (DAD) of the MoF collected information in Excel templates on every single donor-funded project and every month these would be aggregated into a sheet containing information from all donors. Analyses could then be run as needed, pr International Monetary Fund (IMF) programme on a monthly basis. Every six months, an analysis would be conducted on aid predictability, distribution, fragmentation etc. and at the end of the year there would be a verification exercise and the production of an annual report. T then be closed and a new one started for the next financial year. There were three major constraints in the previous system that AMP would address. Firstly, all figures had to be manually converted into Malawi Kwacha using the exchange rates for the month in which the

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

disbursement was made, before combining the data into the main sheet. Secondly, being Excel-based, a single mistake somewhere had considerable knock on effects, which required a constant verification of formulas. Thirdly, having to start a new sheet every year, it evidently became very time-consuming and complicated to run detailed analyses over several years. Box 2. Development Assistance Strategy. The Malawi Development Assistance Strategy (2006 11) (DAS) sets out the policy and strategies for increasing the efficiency and effectiveness in the mobilisation and utilisation of development aid for the realisation of the Malawi Growth and Development Strategy (MGDS). The DAS represents the localisation of the Paris Declaration on Aid Effectiveness and seeks to put into practice its five principles, as follows: OWNERSHIP A. Resource requirements for implementing the MGDS are calculated annually to inform budget allocation and resource mobilisation C. The budget reflects the MGDS priorities ALIGNMENT D. Percentage of development partner (DP) funds that are administered outside government systems is reduced significantly F. All country assistance strategies are aligned to the MGDS H. Flexibility within DP funding cycles is increased J. Increased proportion of aid is provided in the form of sector budget support and general budget support L. DPs annual work plans, monitoring and evaluation (M&E) systems are aligned to MGDS monitoring requirements and formats N. Joint DP/government annual sector reviews held to feed into the MGDS annual review process HARMONISATION P. Technical assistance is provided in a coordinated manner, in line with government needs R. Missions are jointly conducted between four or more DPs T. Common arrangements are increasingly used by DPs for planning, funding, disbursement, M&E and reporting to government MANAGING FOR RESULTS U. Effective monitoring indicators are in place V. An aid management system is in place, Q. MGDS annual review is held every year E. Project implementation units significantly reduced G. Funding gaps for MGDS priority 1 activities are narrowed I. Aid is more predictable K. Increasing proportion of project aid is untied B. Sector strategies are in place and aligned to the MGDS

M. Increased use of national systems for procurement, accounting and auditing O. Aid coordination mechanisms are used to deepen dialogue and alignment to the MGDS and sector strategies

S. Annual development assistance coordination calendar is formulated and DPs adhere to it

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper monitoring inputs and outputs towards PD targets W. Annual reports on the implementation of the DAS are made as part of the Annual Debt and Aid Report MUTUAL ACCOUNTABILITY Y. Independent monitoring group monitors the implementation of the PD and DAS indicators every three years X. Relevant personnel in ministries are fully competent in results-based planning and management

Z. MGDS review is held annually with specific decisions for both DPs and government to act on to further the realisation of the DAS and PD principles

Building on the existing process, the MoF still requests this data from donors on a monthly basis, but now inputs the data into the web-based AMP. Data is collected on each donor programme/project and includes information such as the project title, implementing agency, sector, geographic location, cumulative commitment, monthly disbursements, projected annual (and three-year) disbursements, aid modality, type of assistance and the degree of alignment to country systems (see Annex 6). In the near future, AMP will become available online to other government ministries and donors, enabling them to access the system for data entry, as well as for aid tracking and analysis purposes. AMP is managed by DAD and is perceived as a high priority by its management. Although the system sector classifications and aid-data management requirements. Since 2008, DAD produces an annual Aid Atlas report generated from AMP data, analysing aid flows by sector and donor, funding modality and other key PD indicators. These reports have become instruments to hold donors accountable to the aid effectiveness agenda through an effective name and shame approach. The system is being further embedded in the institutional workflow of the GoM, as the projection data collected have just been used as inputs into the 2011/12 budget process, in terms of determining the recurrent and development budget ceilings per line ministry and department. Moreover, the accessibility of this aid data through AMP allows off-budget donor funding to also be appreciated by parliament, through an extra-budgetary addendum to the official budget documents (Batten, 2010).

Public Sector Investment Programme


There is a distinction in the national budget between the recurrent budget and the development (or capital) budget. The latter is further disaggregated into a donor-funded part (Part I) and a government-funded part (Part II). The Public Sector Investment Programme (PSIP) is intended to manage the entire development budget. It serves as a development planning and development budget management tool and is meant to guide public-sector investment, ensuring optimal allocation of public resources for maximal development outcomes. It identifies programmes and projects that are mechanisms. The PSIP database consists of a list of investment programmes and projects funded by government-guaranteed loans, grants and own resources, in the form of five-year rolling plans. The specific objectives of PSIP are to act as a database of past and projected levels of capital investments by government and donors; ensure that sector strategies are translated into programmes and projects; assist government in planning investments that are consistent with overall expenditure

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

ceilings and sectoral absorptive capacity; coordinate project preparation and implementation to maximise complementarity; and to strengthen project design by providing a standardised framework for all public sector projects (GoM and JICA, 2009). PSIP is managed by a dedicated unit in the Ministry of Development Planning and Cooperation (MoDPC), which is responsible for appraising and screening development programmes/projects to be implemented through the public sector for their alignment to the MGDS, their viability and effectiveness in delivering long-term impact. Based on the MoDPC guidance documents and indicative budget ceilings, line ministries submit ongoing and new projects on an annual basis for screening. Since its creation in the 1980s, PSIP was considered an important aspect of making the budget a comprehensive reflection of actual government expenditure. Based on the assumption that the Medium-Term Expenditure Framework process would suffice for this purpose, PSIP was allowed to lapse from 1997 to 2004, which affected the budget process negatively as the government lost oversight of donor-funded projects going through line ministries. Currently, PSIP aspires to contain information on all donor-funded projects that are on-budget, with the exception of the (general and sector) budget support that is considered recurrent and not investment. Data concerning PSIP programmes and projects are managed through a web-based database that has been accessible to line ministries and the MoDPC since 2009. The monitoring of project implementation is conducted by means of annual financial and programmatic reports, compiled by the implementing agency. Focal point officers within line ministries have access to the PSIP database to update their programme financial details and achievements against their monitoring and evaluation (M&E) indicators on an annual basis (see Annex 7). These reports are aggregated and fed into the Annual MGDS reviews (covered in more detail under Mutual accountability and results focus ).

The Joint Food and Nutrition Security Task Force,3 supported by its Technical Secretariat housed in the MoAFS, facilitates policy dialogue and coordination on food-security issues among government agencies, development partners, civil society organisations and the private sector. Staffed and funded with support from the European Union (EU), the Technical Secretariat also plays a central role in monitoring food-security indicators at both policy and project level. At national level, the Technical Secretariat assists with tracking 57 indicators related to agriculture and food security to supplement the four indicators monitored by the MGDS. Moreover, the Technical Secretariat has facilitated the development of a standardised set of project-level indicators that are currently being used by the majority of the agriculture, food security and natural resources projects in the country. In addition, a project database was set up by the Technical Secretariat in 2004 to manage data on agriculture-related projects being implemented in Malawi. All stakeholders that are known to be active in the sector are requested by the MoAFS to provide and update this project information every six months. The fields in the database include the project donor, implementing agency, total cost, total disbursement to date, project funding type, geographic location, target groups, components,

The Task Force coordinates the implementation and monitoring of the Food Security Policy and Nutrition Security Policy.
3

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

objectives, outputs and indicators. The Accesswebsite and currently contains information on 193 projects.4 Moreover, an initiative is currently being undertaken by the MoF, in collaboration with the University of Texas, the Development Gateway Foundation and AidData, to conduct mapping of each project at village level and produce aggregate maps using a geographic information system. Although this is to be done for the entire AMP, the MoAFS projects were selected for the pilot phase because of the existence of this sector-wide database.

Linkages between systems


As can be seen in Table 1, the three aid information management systems of interest are housed in different ministries and collect data from different sources. The fact that each system has a different purpose affects its data coverage, content, frequency of updates and accessibility. While AMP was initially set up to track and report on ODA, it is increasingly being used for recurrent- and development-budget planning and cash management. The PSIP database was envisaged as the planning tool for the entire national development budget, both the donor-funded part and the government-funded part, which explains its annual data updates and limited online accessibility. The MoAFS database, on the other hand, was established to provide an overview of which projects were being implemented in which districts to enable synergies in implementation, a more equitable distribution of interventions and reduced duplication. The financial data on total project costs and disbursements to date are meant to be indicative, rather than form the basis of an aid-tracking or reporting exercise. Because of this focus, the database is readily available online to anyone and data are collected only twice a year in order to maximise response rates. While AMP and PSIP target different providers of information, the MoAFS project database targets both donor agencies and implementing agencies, in order to capture the totality of the picture and ormation. In other words, donors active in the agriculture and natural resources sector are asked to report to AMP on the one hand and to the MoAFS on the other. Likewise, implementing line ministries report to both PSIP and the MoAFS on the same projects. Although the data requested differ slightly, there is substantial overlap and limited efforts have been made to link the databases and reduce the burden of data provision. Table 1. Comparison of AMP, PSIP and MoAFS databases. AMP Institutional location Debt and Aid Division, Ministry of Finance PSIP PSIP Unit, Ministry of Development Planning and Cooperation Government line ministries or project implementation units All aid invested through the public sector MoAFS project database Technical Secretariat, Department of Agricultural Planning Services, Ministry of Agriculture and Food Security (MoAFS) Implementing agencies and donor agencies All projects in the agriculture, food security and natural resources sectors

Source of information Intended coverage

Resident donor agencies

All aid flows from resident donor agencies

http://www.moafsmw.org/main.php?page_id=Information%20Archive&pars=Databases/Projects%20Database

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Current data coverage Frequency of updates Content (relevant) 837 programmes/projects 28 external donors 109 implementing agencies Monthly Donor Project title and location Implementing agency Sector Aid modality Cumulative commitment Monthly disbursements Annual projections 233 projects 25 external donors 32 implementing institutions Annually Donor Project title Line ministry Malawi Growth and Development Strategy sector and priority Development Assistance Strategy sector Total budget Part I and II budget Since 2004/05 financial year Accessible online to registered users and upon request

10

193 projects 80+ external donors 80+ implementing agencies Every six months Donor Project title and location Implementing agency Total commitment Disbursements to date Project funding type

Period of data availability Accessibility

Since 2007/08 financial year Accessible online to registered users and upon request

Since 2004

Freely accessible online (MoAFS website)

Although all these systems address elements of aid-data management, none is entirely able to measure all aid flows and link them to development outcomes in a comprehensive manner. The strengths and weaknesses of each system are further discussed in . However, it is fair to say that these aid data management systems are not yet adequately linked to each other. Given the effort and time invested in each, there appears to be a certain reluctance to harmonise them. Of late, however, there have been promising interactions between the MoAFS Technical Secretariat, the PSIP Unit and DAD to share information. For the MoAFS, the main interest of information exchange is to ensure that all donor projects reported in AMP are captured in its database for completeness. For PSIP, there is a drive to reduce discrepancies between the development budget and PSIP projects, which should actually be one and the same. Additional efforts have been made to link AMP projections per project to PSIP Part I (donor-funded) budget ceilings, which used to be different due to different budgeting calendars. While the PSIP Unit was supposed to provide indicative budget ceilings in July for the financial year starting in July of the following year, the MoF provided actual ceilings in January, as part of the budget guideline to line ministries and departments. In order to align these processes, the MoF and the MoDPC are now trying to have joint meetings to develop development budget ceilings in November and to conduct budgethearing meetings with line ministries in March (GoM and JICA, 2010). Moreover, since line ministries have tended to sidestep PSIP and submit development budget projects directly to the MoF, the budget division in the MoF is providing information to PSIP on all ongoing projects for the streamlining of project names and other information in PSIP.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

11

aid reporting and coordination systems Internal


Donor agencies have different internal reporting requirements and systems between country offices/missions and their headquarters. Although most programmes/projects require separate reports, certain donors report on consolidated operational work plans that are developed before every fiscal year. Interestingly, in certain donor agencies the reporting on financial expenditures for internal purposes is done by a different office to the one responsible for reporting on disbursements to the MoF (for e.g. USAID). Certain differences were noted in terms of aid data provided to government, other donors and agencies headquarters related to the difference in donor and government definitions of various sectors, in particular the ARD&FS sector (see Definition of the ARD&FS sector ).

One UN
An important harmonisation initiative is the One UN reform being undertaken by the United Nations (UN) system in Malawi to deliver more coherently and effectively on its mandate for increased impact. The so-called Delivering as One is built on the four ones : One Programme, One Budget, One Leader and One Office. In practice, this has provided an impetus among UN agencies to engage in joint programming, producing a four-year UN Development Assistance Framework (UNDAF), aligned to the Annual work plans (including budgets) are formulated and subsequently monitored against a set of output and outcome indicators, as well as against the funded budget.

sustainable economic growth and food security, most of which is related to the ARD&FS sector. Cluster 1 brings together the principal UN agencies supporting this domain, including the Food and Agriculture Organization (FAO), the International Labour Organization (ILO), the UN Industrial Development Organization (UNIDO), UNDP and the World Food Programme (WFP).

Donor coordination on agriculture and food security)


Development partners (DPs) in the agriculture sector have created the Donor Coordination Group on Agriculture and Food Security (DCAFS) as part of their efforts to harmonise their investments in the sector. DCAFS meets on a monthly basis to discuss topical issues in the sector that are of interest or concern to donors. In recent years, much of the focus has been on the FISP, as well as the finalisation of the agriculture sector-wide approach (ASWAp), in line with the Comprehensive Africa Agriculture Development Programme (CAADP) process. DCAFS is currently chaired by the Head of Mission of Irish Aid and supported by a DCAFS coordinator. Additionally, DCAFS has put in place an interface mechanism between donors and MoAFS through a troika-system, whereby three donors (currently Irish Aid, the EU and the World Bank) are tasked to meet the Principal Secretary for Agriculture and Food Security and his management team on a regular basis to voice the collective issues/concerns of donors and feedback the issues raised by the Ministry.

Climate Change, Environment and Agriculture Joint Resilience Unit


A number of DCAFS members (Irish Aid, DFID, Norway, the Deutsche Gesellschaft fr Internationale Zusammenarbeit [GIZ], the Flemish International Cooperation Agency [FICA] and USAID) recently formed the Climate Change, Environment and Agriculture Joint Resilience Unit (JRU) to coordinate and integrate donor programming on climate change and disaster risk reduction. Neither DCAFS nor

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

12

JRU have established an information management system, as their primary purpose is to provide a forum for donors to harmonise their assistance and coordinate their dialogue with the GoM.

Definition of the ARD&FS sector


In producing data on aid to ARD&FS, it appears that different definitions are being used in Malawi. Within government, various sector demarcations are applied, while donors also have their own internal classifications. This section documents these different definitions and relates them to the ODI working definition of aid to ARD&FS (see Box 3). Box 3. ODI working definition of aid to ARD&FS.

Working definition of aid to ARD&FS comprises all ODA flows falling under three policy domains: 1. Agricultural, forestry and fishing productive activities and supporting services : this includes all aid flows provided directly to agricultural5 productive activities, recorded by the CRS purpose code as sector-allocable aid to agriculture, forestry and fishing. This comprises aid to policy development and regulation, research, extension and training, input production and distribution, crop production etc. This policy domain also includes a relevant proportion of aid flows provided to areas supportive of these productive activities although not directly imputable to the sector, such as: banking and financial services, business support services and trade policy and facilitation. For the purpose of calculating the volume of aid to these productive activities, a share of general budget support and NGO support is also included under this policy domain. 2. Rural social-economic development: this includes rural development, non-agricultural alternative development, women's equality organisations and institutions, and (developmental) foodaid or food-security programmes. Aid to projects favouring the position of women in development is particularly important as women play a central part in agricultural productive activities. Transport and storage may also be brought into the definition, provided the donor studies demonstrate this to be an important policy issue within the ARD&FS sphere. 3. Emergency relief and welfare: this includes emergency food aid and a share of material relief attributable to the agricultural domain. It also includes social-welfare activities related to the agricultural and food sector: basic nutrition and social mitigation of HIV/AIDS, an important component given the devastating impact of the disease in this productive sector.

Government of Malawi

definition

The national budget that is presented to parliament before every financial year presents budget allocations by budget votes, which represent the line ministries and other government institutions that will be spending the resources. For each vote, the allocation is further divided into a recurrent and a capital budget. The recurrent budget consists of personal emoluments and other recurrent transactions, while the capital (or development budget) includes the donor-funded part (Part I) and the government-funded part (Part II).

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

13

Every decentralised local council has a budget vote for its annual recurrent allocation. Since the 2006/07 financial year, the recurrent budget allocated to the decentralised local councils has also been disaggregated by sectors (or categories). There have been shifts and variations since then, but the latest budget listed the following relevant sectors (cost centres) at district level: Agriculture Irrigation Forestry Fisheries Trade Environment

These votes and cost-centre codes have been the most consistent over the years. However, in addition to these, the budget can be classified according to programme codes, which are meant to link the budget (or inputs) to the MGDS and its programmatic outputs. These programme codes have been evolving and changing. The latest classification for the ARD&FS-relevant output-based budget themes, sub-themes and sub-sub-themes can be found in Table 2. Similarly, the budget lends itself to a sector classification and a functional classification, which essentially group different votes and cost c . Table 2: MoF budget classification by theme, sub-theme and sub-sub-theme for relevant areas. Theme Sustainable economic growth Sub-theme Agriculture and food security Potential growth sectors Enabling environment for private-sector development Export-led growth Conservation of natural resources Sub-sub-theme Agricultural productivity Agroprocessing Manufacturing Enabling environment for privatesector development Export-led growth Fisheries Forestry Environmental protection Wildlife Increased employment Increased productivity Women, youth, disabled Land Climate change Protecting the vulnerable Disaster risk management Nutrition Interaction of nutrition and HIV/AIDS Integrated rural development

Economic empowerment

Social protection Social development

Land and housing Conservation of natural resources Protecting the vulnerable Disaster risk management Prevention and management of nutrition disorders and HIV/AIDS Integrated rural development

Infrastructure development

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

14

Since 2008, the GoM through the MoF has been institutionalising the so-called sector working groups (SWGs) as a means of implementing the DAS and thus the MGDS (see Table 3). These SWGs (also referred to as DAS sectors) are expected to provide a forum at sector level for policy dialogue, negotiation and agreement of plans between the government and its development partners. SWGs are to identify, finance and implement a joint programme of work, as well as monitor sector performance against a set of agreed milestones. According to the GoM, the advantages of this sector-based approach include: (i) harmonising sector policy development, planning, budgeting, implementation and M&E; (ii) increasing the efficiency of resource use through coordinated prioritisation of activities; (iii) improving the visibility of marginalised (sub) sectors; and (iv) helping the government and its development partners to agree on a better division of labour (GoM, 2008a).

quarterly basis to build mutual trust and strengthen mutual accountability. Each SWG is chaired by the Principal Secretary of the lead line ministry and vice-chaired by a lead sector donor. Although the initial aim was to rationalise the number of sectors with comprehensive yet manageable scopes, the vested interest of each line ministry to have its own sector led to a compromise of 16 SWGs, grouped under the five MGDS themes. Many in government and donor agencies still consider this number to be too large. Of these 16 SWGs, the following have a direct bearing on ARD&FS, as defined by ODI: Agriculture; Integrated Rural Development; Water, Sanitation and Irrigation; Environment, Lands and Natural Resources; Trade, Industry and Private-Sector Development; and Vulnerability, Disaster and Risk Management. Moreover, the areas of basic nutrition and HIV impact mitigation are currently under the remit of the Health SWG, captured under the Gender, Child and Youth Development SWG. Although the MoF recognises that some of these SWGs contain subsectors, less attention has gone to establishing adequate linkages between (sub)sectors and across SWG boundaries. Given the largely ministry-based (or vote-based) definition of sectors, the evolution in the names of relevant ministries over the past 20 years provides an indication of evolving sector boundaries. As can be seen in Rural development was initially under the remit of the agriculture sector, as spelled out in the Statement of Development Policies (1987 1996). However, with the decentralisation policy of the late 1990s, rural development was eventually amalgamated with the local governance and decentralisation agenda. In practice however, integrated rural development remains to be defined by the GoM. The Ministry of Local Government and Rural Development (MoLGRD) is currently devising an integrated rural development (IRD) strategy to provide this much-needed guidance and to serve as a medium-term strategic plan for the IRD SWG. , the MoAFS itself has been mostly marked by the inclusion and exclusion of the irrigation subsector. The current institutional set-up joins irrigation with the water development subsector, based on their joint mandate to establish and rehabilitate water-related infrastructure. This reveals a policy shift within government, whereby the infrastructure and production components of irrigation are to be dealt with separately. Another interesting change that does not come out in the name of the ministry is the incorporation of the Department of Fisheries in the MoAFS since 2007. Before then, fisheries were approached from a natural resource management perspective, whereas of late the subsector role in promoting food security is being underscored; fish represent 70% of animal protein intake in .

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

15

Figure 1. Evolution of ministries between 1990 and 2010. 1990 Ministry of Agriculture 1995 Ministry of Agriculture and Livestock Development Ministry of Irrigation and Water Development Ministry of Local Government Ministry of Local Government and Rural Development Ministry of Natural Resources Ministry of District and Local Government Administration 2000 Ministry of Agriculture and Irrigation Ministry of Agriculture, Irrigation and Food Security 2005 2010

Ministry of Agriculture and Food Security

Ministry of Irrigation and Water Development

Ministry of Local Government and Rural Development

Ministry of Forestry and Natural Resources

Ministry of Forestry, Fisheries and Environmental Affairs Ministry of Lands, Housing and Physical Planning

Ministry of Mines, Natural Resources and Environment

Ministry of Energy and Mines

Ministry of Natural Resources, Energy and Environment

Ministry of Lands and Valuation

Ministry of Lands and Natural Resources

Ministry of Lands, Housing and Urban Development

Ministry of Trade, Industry and Tourism

Ministry of Trade and Industry

Ministry of Commerce and Industry

Ministry of Industry, Trade and Private Sector Development

Ministry of Industry and Trade

The natural resources sector has also been marked by fluid boundaries and categorisations that seem to characterise certain policy shifts. Besides the recent move of fisheries, natural resource management has been alternately associated with environmental affairs and energy issues. The short-lived nomenclature of the Ministry of Lands and Natural Resources can be disregarded, as the key natural resources subsectors (forestry and fisheries) were not in that ministry, but rather in the ill named Ministry of Energy and Mines. The recent nomenclature with energy or mines since early 2000s was perceived by many as an unfortunate one, especially in a country with a 2.8% annual deforestation

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

16

rate largely resulting from the charcoal industry. However, the current union of natural resources, energy and environment appears topical. That being said, it is slightly misleading given that the overall coordination of climate-change issues is housed within the MoDPC.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

17

Table 3.

sector working groups.6

Theme 1: Sustainable economic growth 1 Agriculture Ministry of Agriculture and Food Security Ireland, AfDB, EU, USAID, World Bank, Japan, DFID, IFAD, Norway, FICA, FAO, ICEIDA, UNIDO, UNDP GIZ, AfDB, EU, Japan, IFAD, UNDP, FAO, UNFPA Norway, Japan, EU, USAID, World Bank, UNDP, UNESCO Norway, USAID, UNFPA AfDB, Arab donors, Japan, DFID, FICA, ICEIDA, World Bank, USAID, UNICEF, GIZ, CIDA World Bank, USAID, UNIDO, UNDP, DFID, EU, Japan

2 3 4 5 6

Integrated rural development Environment, lands and natural resources Tourism, wildlife and culture Water, sanitation and irrigation Trade, industry and private-sector development

Ministry of Local Government and Rural Development; National Local Government Finance Committee Ministry of Lands and Natural Resources Ministry of Tourism, Wildlife and Culture; National Herbarium and Botanical Gardens Ministry of Irrigation and Water Development Ministry of Labour; Ministry of Industry, Trade and Private Sector Development; Development of Malawi Traders Trust; Malawi Entrepreneurship Development; Small Enterprise Development of Malawi Department of Disaster Management Affairs (Office of the President and Cabinet); Ministry of Persons with Disabilities and the Elderly; Malawi Council for the

Theme 2: Social protection and disaster risk management 7 Vulnerability and disaster risk management DFID, EU, WFP, UNICEF, UNDP, Ireland, Japan, USAID, FAO, WHO

Adapted from GoM (2008a) and development partners providing aid per sector from 2007/08 to 2009/10 according to GoM (2011).

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

18

Handicapped; National Youth Council Theme 3: Social development 8 Health Ministry of Health; Department of Nutrition, HIV and AIDS (Office of the President and Cabinet); National AIDS Commission; Pharmacies, Medicines and Poisons Board; Health Services Regulatory Authority; Kachele Rehabilitation Centre Ministry of Education, Science and Technology; University of Malawi; Malawi Institute of Education; National Library Services; National UNESCO Commission; Malawi National Examination Board; Scholarships Fund; Malawi College of Health Sciences; Mzuzu University; National Resources College Trust; University Student Trust Fund; University of Science and Technology Ministry of Youth Development and Sports; Ministry of Gender and Child Development; National Sports Council Ministry of Transport, Public Works and Housing; Road Fund Administration; Roads Authority Information and Civic Education; Malawi Broadcasting House; Malawi Industrial Research and Technology Ministry of Energy and Mines; Geological Surveys; Mines Department National Audit Office; Directorate of Public Procurement; WHO, CDC, Japan, AfDB, EU, CIDA, DFID, GIZ, FICA, Norway, Global Fund, UNICEF, World Bank, UNFPA, UNHCR, USAID, FAO, ICEIDA, Ireland, UNDP, UNAIDS GIZ, AfDB, CIDA, DFID, Japan, UNICEF, USAID, World Bank, EU, UNESCO, WFP, ICEIDA, Ireland, UNFPA

Education

10

Gender, youth development and sports Roads, public works and transport Information, communication and technology and research and development Energy and mining

USAID, UNICEF, Norway, AfDB, CIDA, UNAIDS, ICEIDA, UNDP EU, AfDB, BADEA, Japan, Arab Donors, World Bank, DFID UNDP, World Bank

Theme 4: Infrastructure development 11 12

13

World Bank, Japan, UNIDO, UNDP

Theme 5: Improved governance 14 Economic governance DFID, AfDB, CIDA, EU, GIZ, Ireland, Japan,

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

19

Ministry of Economic Planning and Development; National Statistical Office; Ministry of Finance; Accountant General; Malawi Revenue Authority 15 Democratic governance Judiciary; Ministry of Defence; Malawi Defence Force; Financial Intelligence Unit; Ministry of Home Affairs and Internal Security; Police; Prisons; Immigration; Ministry of Justice; Director of Public Prosecution and State Advocate; Registrar General; Administration General; Legal Aid; Human Rights Commission; Electoral Commission; Anti-Corruption Bureau; Office of Ombudsman; Law Commission Presidency; State Residences; Office of the President an Cabinet; Human Resource Management and Development; Public Service Commission; Office of the Vice President; Ministry of Foreign Affairs

Norway, UNICEF, UNDP, World Bank

DFID, CIDA, EU, GIZ, Ireland, Norway, UNDP, UNHCR, USAID

16

Public administration

UNDP, CIDA

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

20

Rural development was initially under the remit of the agriculture sector, as spelled out in the Statement of Development Policies (1987 1996). However, with the decentralisation policy of the late 1990s, rural development was eventually amalgamated with the local governance and decentralisation agenda. In practice however, integrated rural development remains to be defined by the GoM. The Ministry of Local Government and Rural Development (MoLGRD) is currently devising an integrated rural development (IRD) strategy to provide this much-needed guidance and to serve as a medium-term strategic plan for the IRD SWG. In terms of aid-data management, the drive to institutionalise the defined SWGs implies that government systems are supposed to be categorised along the lines of the five MGDS themes and the 16 SWGs. AMP uses this sector definition and PSIP has also started classifying projects accordingly, in addition to its classification by MGDS priority area. However, MoAFS appears to be working with a much broader definition of the agriculture sector, as can be noted in the project database, but also in the ASWAp (see Table 4). The project database is adopting a classification of projects with 10 components, namely irrigation, finance, livestock, fisheries, marketing, income-generating activities (IGAs), nutrition, water and sanitation (for nutrition), horticulture, forestry, research and other. Although the database started off using DAC codes, this classification was dropped as it was found to group too many components under one code, which was not considered useful in the Malawian context. Table 4. Classifications used by different systems and policies in ARD&FS sectors. PSIP and MGDS MGDS priority areas: Agriculture and food security Integrated rural development Climate change, natural resources and environmental management Green-belt irrigation and water development AMP and SWGs MGDS Theme 1: Sustainable economic growth Agriculture Integrated rural development Environment, lands and natural resources Water, sanitation and irrigation Trade, industry and private-sector development MGDS Theme 2: Social protection and disaster risk management Vulnerability, disaster and risk management ASWAp Focus areas: Food security and risk management Commercial agriculture, agroprocessing and market development Sustainable agricultural land and water management Key support services: Technology generation and dissemination Institutional strengthening and capacity building Cross-cutting issues: Gender HIV/AIDS MoAFS database Horticulture Livestock Fisheries Irrigation Finance Marketing Incomegenerating activities Water Nutrition Forestry Research Other

MGDS focus areas: Social protection Gender Land and housing

Although not yet supported by an aid information management system, ASWAp represents a prioritised and harmonised investment framework to advance the agricultural development agenda in

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

21

Malawi. As such, it provides a critical guiding definition of the sector and its boundaries. The objectives of the programme are to achieve an annual agricultural growth rate of 6% by increasing agricultural productivity; improving food security and nutrition at household level; increasing agricultural incomes of the rural people; while conserving the natural resource base. ASWAp is built upon three focus areas, two key support services and two cross-cutting issues. The focus areas are: (i) food security and risk management, (ii) commercial agriculture, agroprocessing and market development and (iii) sustainable agricultural land and water management. The key support services are: (i) technology generation and dissemination and (ii) institutional strengthening and capacity building. The cross-cutting issues are: gender equality; and HIV prevention and AIDS impact mitigation. The institutional framework of ASWAp invokes the involvement of various government ministries, civil-society stakeholders, private-sector actors and development partners in the implementation of this overarching sector programme. Indeed, the Ministry of Industry and Trade (MoIT) is expected to play a central role under the second pillar of commercialisation and market linkages, while the Ministry of Irrigation and Water Development (MoIWD) will be responsible for developing and rehabilitating irrigation infrastructure for increased production. The Ministry of Natural Resources, Energy and Environment (MoNREE) is to ensure the sustainable use of land and water resources during implementation. The Ministry of Lands and Physical Planning assumes the lead on land issues for agricultural production. MoLGRD is considered to be the engine of decentralised implementation of the programme, as it is responsible for the local councils. Given the integration of a number of multisectoral and cross-cutting issues, such as nutrition, gender, HIV and climate change, other government institutions are also to be closely involved in ASWAp, such as certain departments within the Office of the President and Cabinet (OPC).

In general terms, the key donors in Malawi have adopted a different definition of the ARD&FS sector than that introduced by the GoM through its SWGs. Even between donors, the categorisation varies. One of the approaches identified among a number of donors is that of an overarching economic growth sector, much like the MGDS Theme 1, which contains an agriculture component, a natural resource management component, a trade or private sector development component and a disaster risk reduction or resilience component. This is the case with USAID, DFID, the UN family and Irish Aid to a certain extent (see Table 5). A second approach is a more traditionally defined agriculture and rural development sector that incorporates natural resource management, irrigation and rural livelihoods. The multilaterals (AfDB, EU, World Bank) and the Japanese International Cooperation Agency (JICA) have adopted the latter. Hence, the boundaries set by donors are much more in line , which could suggest a strong donor influence in the ASWAp design or a disconnect between MoAFS and MoF. Donors have expressed concerns with the excessive number of SWGs, which is exacerbated by the weak interministerial collaboration. Moreover, this divergence in definitions has led to challenges in implementation. For example, due to internal AfDB requirements, the lead implementing agency for an irrigation project being funding by AfDB must be MoAFS, meaning that funds will be channelled through that ministry to the Department of Irrigation in MoIWD. While donor focus areas and technical expertise are defined differently, the new institutional set-up could result in the suboptimal representation of technical experts in various SWGs. Finally, donors could be wrongly depicted in the

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

22

aid effectiveness monitoring as providing fragmented aid based on MoF seemingly fragmented support could be very coherent within their own sector definition and the ASWAp definition. Table 5. Key priorities of ongoing support from main donors to the ARD&FS sector. Components of ARD&FS are marked with an asterisk (*). Donor World Bank Current strategic priorities in Malawi7 Agriculture and rural development* Human development Infrastructure Private sector development (PSD) Growth and resilience* Health Education Good governance Ongoing ARD&FS-labelled programmes Agriculture Development Programme Special Project Irrigation, Rural livelihoods and Agricultural Development Project Community-based Rural Land Development Project Agriculture project focusing on FISP conservation agriculture Community resilience programme Access to finance programme Private sector development Humanitarian support Agricultural productivity Natural resources management and climate change adaptation Market linkages, private sector growth and trade Disaster risk reduction and humanitarian assistance Promotion of democratic decentralisation Comments on ARD&FS scope Broader scope could also include the Business Environment Strengthening Technical Assistance Project being implemented through the Ministry of Industry and Trade with support from team. The programmatic areas under the growth and resilience team are very much in line with the ODI definition, as they capture more including material and welfare aid (under humanitarian support) and business and financial support. The Feed the Future implementation plan emphasises women as targeted agricultural producers to be engaged in market-oriented growth. Nutrition projects are housed in the Health Office, but close collaboration with the economic growth team on agriculture. GIZ also has a multi-country project that is of relevance to the ARD&FS domain, namely a programme for advising on community dry forest management. Interestingly, rural infrastructure projects are being funding through MoLGRD, not the Ministry of Transport and Public Infrastructure.

DFID

USAID

Economic growth* Health Democratic governance

GIZ 8

Decentralisation* Health Basic education

EU

Rural development, agriculture, food security and natural resources* Transport and infrastructure

Farm Income Diversification Programme Forestry Programme Rural Infrastructure Development Programme Income Generating Public Works Programme

7 8

As indicated during personal communications or as defined in country assistance strategies/plans. Source: http://www.gtz.de/en/weltweit/afrika/588.htm

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Donor Current strategic priorities in Malawi7 Ongoing ARD&FS-labelled programmes ASWAp Green Belt Initiative Farm Input Subsidy Programme Agriculture Infrastructure Support Project Strengthening Institutions for the Risk Management of Transboundary Animal Diseases in the SADC Region Lake Malawi Artisanal Fisheries Development project Support to Local Economic Development Agriculture Development Programme Special Project FISP Livelihood programmes and biodiversity Climate change adaptation through conservation agriculture Farmer Artificial Insemination Technician Foster Project One Village One Product Sustainable Land Management Community Vitalization and Afforestation in Middle Shire and Forest Conservation Development of irrigation schemes and sector harmonisation Capacity to cope with climatechange-related natural disasters Agricultural productivity and diversification Soil fertility management through conservation agriculture Nutrition Disaster risk reduction Social protection Agricultural productivity for food and nutrition security Private sector development, employment and income generation Natural resource, climate

23

Comments on ARD&FS scope

AfDB

Agriculture and rural development Water and sanitation Infrastructure Trade Education Health

Through its trade arm, AfDB supports the private sector through a local economic development programme, of which one component concentrates on agricultural value chain development.

Norway

Climate change* Health Economic governance

Norway classifies its supports to the agriculture sector under its climate-change mitigation and adaptation.

Japan

Agriculture and rural development Infrastructure Health Education Water and sanitation

The rural electrification programme is under their infrastructure arm and implemented through MoNREE.

Irish Aid

Agriculture and food security* Resilience* Good governance

Nutrition is mainstreamed within the agriculture and the resilience focus areas. Agriculture and disaster risk reduction are approached from the angle of climate-change mitigation. In the new UNDAF (2012 16) disaster risk reduction and resilience of the most vulnerable groups have been incorporated in the economic-growth cluster. Most of the nutrition activities

One UN

Sustainable economic growth and food security* Social development HIV/AIDS Good governance

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Donor Current strategic priorities in Malawi7 Ongoing ARD&FS-labelled programmes change and disaster risk management

24

Comments on ARD&FS scope captured in the DAC classification (minus household food security) are under the remit of the social development cluster.

Issues to be considered for definition and tracking of aid to ARD&FS


Since independence, the government has always promoted agriculture as the motor of economic growth and aid flows in support of economic development have largely been agricultural in nature. Moreover, 85% of the population lives in rural areas, further exacerbating the challenge of demarcating boundaries for ARD&FS.

Agriculture for economic growth


While donors and the GoM distinguish between the agriculture sector and the trade, industry and private sector development sector, most of the activities implemented in the latter have a direct bearing on agricultural development. ASWAp has recognised this interdependence and embraced agriculture-based trade and industry under its commercialisation and market development pillar. While ODI allocations of business/financial services and trade to agriculture are 10% and 20%, respectively, the case can easily be made for these to be considerably higher in the Malawian context. Following the share of agriculture in national GDP, 39% of aid for business and bank/financial services should be allocated to agriculture, while 90% of aid for trade can reasonably be attributed to the sector in accordance with the share of agriculture in foreign exchange earnings.

Governance and decentralisation


Donor assistance to local governance and decentralisation is likely to be classified differently in the GoM books and in the international-level donor books. While the CRS purpose code for rural development includes the promotion of decentralised and multisectoral competence for planning, coordination and management, it is reasonable to suspect that these flows are more likely to be reported under the overall governance umbrella, rather than the rural development one. Likewise, MoLGRD, while there is another SWG that deals with democratic governance. The CRS rural development purpose code also absorbs land-use planning and land (re-)settlement interventions. In Malawi, however, these issues are dealt with under the Ministry of Lands, Housing and Urban Development, which falls under the Environment, Lands and Natural Resources SWG. The two World Bank grants for land resettlement in the Southern Region are currently captured in that SWG and not under the Integrated Rural Development SWG.

Natural resource management and climate change


Natural resource management is receiving increasing attention in the context of climate-change adaptation and mitigation. In Malawi, most of these efforts are agriculture- and forestry-based, but they are increasingly being repackaged into climate-change adaptation interventions to attract more funding. It is therefore possible that such aid-funded agriculture, forestry or rural development activities could start being labelled as environment and/or climate change.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

25

Infrastructure for agricultural and rural development


Many of the large donor-funded infrastructure projects are related to irrigation, rural feeder roads and public-works programmes, thereby contributing quite directly to ARD&FS. Yet the current definitions in use by donors and the GoM exclude most of these contributions from aid to the sector. This probably has the effect of minimising the contribution of emerging donors to this domain. Irrigation is in a particularly awkward position, as it has been split from its agricultural home on the one hand to be married to the water and sanitation sector, while donors and ASWAp still consider it to be part and parcel of the agriculture sector.

General budget support


The ODI definition of aid to the sector tentatively assumed that 10% of general budget support (GBS) could be allocable to ARD&FS. Based on the average proportion of the national budget being allocated to MoAFS from 2005/06 to 2009/10, a more adequate proportion would be 14%. This remains relatively conservative, given the high political profile of the sector and specifically its capitalintensive FISP, which is funded through the recurrent budget and directly consumes about 70% of the m total budget. In terms of aid contributions to FISP, they are in the form of both GBS and sector budget support (SBS) (pooled and discrete).

Cross-cutting issues: gender, nutrition and HIV


It is worth noting that the areas categorised as cross-cutting are generally quite well mainstreamed within aid to the sector. In other words, donor-funded activities for nutrition, gender and HIV that are meant to be implemented by agricultural institutions tend to be labelled as agriculture. However, it is fair to assume that several of these activities implemented outside the realm of agriculture are often directly related to the sector, such as agriculture-based economic empowerment interventions for women. Ministry of Gender, Children and Community Development or NGOs that are associated with this sector and therefore likely to be classified as such. An additional issue to be considered is the growing attention to the economic empowerment of youth, which again tends to rely on agricultural resources, but is captured under the Gender, Child and Youth Development SWG. Allocating 50% of aid to genderpointing out that much of the resources that have been channelled through this sector recently were . Moreover, as nutrition is indivisible from food security, it becomes vital to capture all flows going to basic nutrition interventions. In Malawi, where nutrition is explicitly viewed as cross-cutting to agriculture, health and social welfare, this means pulling out nutrition programmes/projects from the health sector (therapeutic feeding, surveillance), the education sector (school feeding, nutrition education) and the gender and community development sector (community-based nutrition education). Since a fair proportion of HIV/AIDS social impact mitigation interventions are related to strengthening livelihoods and promoting IGAs for affected households, it is entirely justified to allocate part of the aid in this area to agriculture and rural development. Most of it is channelled through communitybased organisations though, making it rather difficult to analyse in more detail.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

26

Comparison with ODI definition


The methodology developed by ODI to calculate ODA flows to ARD&FS provides a broader definition of ARD&FS that covers activities that are particularly relevant in the context of Malawi and support provided by donors. Indeed, while the CRS definition covers the main areas receiving aid (agricultural development, rural development and natural resources management), the ODI definition captures certain a shift towards integrated nutrition and food-security interventions; value-chain approaches to increase value added and competitiveness of agricultural production; and a branching off towards complementary social protection/welfare interventions to ensure food security for the most vulnerable. However, this definition fails to integrate other key elements of donors support to ARD&FS, and in particular: (i) development of basic infrastructures in rural areas (for e.g. rural feeder roads); (ii) disaster risk reduction (through afforestation for example); (iii) climate-change adaptation; and (iv) the full scope of social protection for enhanced resilience, although certain donors, such as DFID and Irish Aid, are explicitly approaching hunger from a social protection angle.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

27

Overview of aid flows to ARD&FS


This section is based on data from the AidData system,9 the Malawi Aid Management Platform and the GoM annual budget statements.10 Box 4. Current ODA flows to Malawi. The Ministry of Finance produces an annual Malawi Aid Atlas since 2008. The 2009/10 Atlas reported US$792 million in donor disbursements, a marginal 1% decline from the 2008/09 financial year. The EU made the largest overall contribution (US$155 million), followed by the World Bank (US$139 million) and DFID (US$108 million). Aid continues to be concentrated in certain sectors, with the economic governance, health, agriculture, education and water and sanitation sectors accounting for 82% of total aid. There has been a recent shift from pooled/sector budget support to general budget support, which currently represents 30% of total aid. Direct project support remains the preferred disbursement modality for donors (55%). Moreover, 24% of total aid flows are being disbursed through NGOs and 48 project implementation units from 12 donors are operating in parallel to country systems. Fragmentation remains high in priority sectors, such as the agriculture sector with its 14 donors and 72 projects.

Volumes of aid resources


The total volume of aid being allocated to ARD&FS in Malawi varies with the definition used. For the sake of further comparing aid data collected internationally and data contained in AMP, Table 6 presents both sets of data for the only overlapping year (2008). According to the international AidData system, in 2008 Malawi received a total of US$919 million (in constant 2008 dollar values), of which US$81 million was invested in the traditional agriculture, forestry and fisheries sector (AFF), US$148 million if the rural development, food security and emergency food aid categories are included and US$254 million using the broader ODI definition. By relating the aid disbursements from the Malawi , it seems as if these data are quite similar in terms of volume. In fact, even the classifications of the CRS purpose codes and the relevant Malawi SWGs can be reconciled to a certain extent. Most of the discrepancies between the data in AidData and AMP can be reasonably explained. Indeed, the low figure for irrigation in AidData could suggest that irrigation flows are not classified by donors as agricultural water resources or reflect the fact that they are only reported as commitments in the year when an agreement is signed, which might not have been the case in 2008. Secondly, most of the food-security programmes under the ODI-defined rural socio-economic development category are or to the vulnerability, disaster and risk-management sector, which deals with social cash transfers and

www.aiddata.org, developed by Brigham Young University, College of William and Mary and Development Gateway. 10 Source: GoM budget statements from 1990/91 to 2010/11, produced by MoF.
9

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

28

project food assistance. Indeed, vulnerability and disaster risk management (DRM) is a growing focus area, but the ODI definition includes only emergency food aid, while in Malawi the scope has expanded to broader social protection interventions and disaster preparedness. The remaining disparities context. As discussed in the previous section, the allocations of trade and business/financial services to agriculture should be 90% and 39%, respectively, while 17% of GBS was allocable to agriculture in 2008. All projects in AMP that were related to nutrition and feeding (school, therapeutic) were included in Table 6. Although the definition of basic nutrition in the CRS purpose code includes projects related to feeding, they appear to be significantly underreported in AidData. This is probably due to their primary homes being in the education and health sectors for most donors. Table 6. Current volume of ARD&FS aid by sector definition and source of data, 2008 (million US$).11 AidData AMP sectors AidData 2008 (million US$ 200812) 65.2 15.2 0.4 80.7 64.9 2.2 147.8 1.1 GoM AMP 2008/09 (million US$) 66.9 18.6 18.7 104.2 20.6 31.5 156.2 6.9

1. AFF minus13 2. Agricultural land resources and forestry development 3. Agricultural water resources 4. AFF14 (1+2+3) 5. Rural development and foodaid/food-security programmes 6. Emergency food aid 7. AFF+15 (4+5+6) 8. Agro-industries, forest industries, banking and financial services, business support services and institutions & trade facilitation 9. General budget support 10. n.a. 11. Basic nutrition

1. Agriculture 2. Environment, land and natural resources 3. Water, sanitation and irrigation (only irrigation included) 5. Integrated rural development 6. Vulnerability, disaster and risk Management 8. Trade, industry and private sector development

9. General budget support (14%) 10. Gender, child and youth development 11. Nutrition extras (health and

20.8 3.8

23.0 5.9 19.8

11

12 DAC deflator for 2000 to 2008 = 99.09/80.07=1.23.


13

resources and the forestry-related codes (forestry policy and administrative management, forestry development, fuelwood/charcoal, forestry education/training, forestry research and forestry services). 14 OECD-DAC narrow definition of agricultural aid, corresponding to sectoral allocable aid to agriculture, forestry and fishing. 15 OECD-DAC wider definition, which adds rural development, development food aid and emergency food aid to the narrow definition.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper education) 12. n.a.

29

12. Support NGOs, Material relief, Social mitigation of HIV/AIDS 13. ARD&FS16 (7+8+9+10+11+12) 14. Total aid to Malawi 15. Share of aid to ARD&FS (13/14)

1.3 255.4 918.8 28%

211.8 803.5 26%

Other specific areas that were added in the ODI definition were difficult to disaggregate from their sector totals or from project titles, such as material relief from the vulnerability and DRM sector, as well as social impact mitigation for HIV/AIDS from the HIV/AIDS-labelled flows within the health sector. Moreover, including 10% of total support to NGOs would have been a duplication of many flows already registered under relevant sectors in AMP. In terms of aid trends to ARD&FS over the past two decades,

Figure 2 illustrates a decline in the 1990s and early 2000s, followed by a relative increase since 2003/2004. Although the expanded definitions of the sector reveal higher volumes of aid going to the sector, they do not tell a different story (possibly because the non-AFF categories are being underestimated). The peaks in 1991/92, 2002/03 and 2004/05 show since 1990. The variance in the volumes for the different sector definitions suggests relatively holistic approaches to the crises, where emergency food aid was accompanied by developmental food security, rural development and agricultural productivity programmes. For example, USAID supported expanded credit programmes in 1993 to provide seed and fertiliser packs to jump-start food production for those most severely affected by the drought. However, the tendency of all flows to drop significantly after the crises indicates that these efforts continued to lack long-term investments in productive capacities and mitigation measures.

16

ODI-proposed definition, which adds additional purpose codes to the DAC definition. See Annex 1.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

30

Figure 2. Aid flows to ARD&FS by type of sector definition, 1990 2008 (million US$). PC ARD&FS CConst 250 200 150 100 50 0 1990
. Source: AidData

DAC AFF+ Cconst

DAC AFF Cconst

1995

2000

2005

The 1992 peak reflects a major International Development Association (IDA) (World Bank) emergency recovery grant of US$120 million (thus US$147 million in 2000 US$) in response to the alarming drought and resulting food insecurity. This grant was classified as a food-security programme, rather than emergency food aid, even though its proceeds had been used for food purchases (World Bank, 2007a). It is important to note that AidData relies on commitments, which can vary considerably from disbursements and even more from expenditures. The data contained in the MoAFS project database reveals that disbursements to date represent about 53% of total project commitments. However,

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

31

these are all ongoing projects, making it difficult to interpret this average proportion with varying remaining project lives. The data provided by USAID17 on its commitments and disbursements to the areas of agriculture, private sector and trade, environment and disaster preparedness between 2001 and 2009 (see Annex 4) allow for more meaningful analysis. While disbursements represented close to 100% of commitments until about 2006, this proportion fell to as low as 49% in the agriculture sector (2008) and 0% in the area of private sector and trade (2009). Although USAID works primarily through non-governmental implementing partners that are expected to have more absorptive capacity, problems with low burn rates have surfaced, especially among local organisations. The current share of total aid invested in ARD&FS is 19% according to the most recent complete AidData figures (2008). The 2009/10 Malawi AMP indicates that agriculture (11%), environment (6%), IRD (3%) and irrigation (5%) received 25% of the total aid recorded. Moreover, the donor-funded part represented 13% of total government spending through this ministry. According to AidData, this relative weight has dropped significantly since the early 1990s (see Figure 3). The figures -funded development budget (known as Part I) 18 confirm this trend, albeit with a slight lag (see Figure 4), which could be an illustration of the lag between funds being committed and reported internationally to when they are actually allocated and disbursed at country level, or changes in the channel of aid delivery used for ARD&FS interventions (government or NGOs). Figure 3. Share of flows to ARD&FS in total aid flows, 1990 2008. 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 1990
Source: AidData.

1995

2000

2005

USAID was the only one of the four donors to be studied in more detail that provided this data. The share of ARD&FS in the total Part I budget is the share going to MoFS, MoLGRD, MoNREE (and Departments of Forestry and Fisheries where reported separately), MoIT and MoIWD when irrigation was out of MoAFS.
17 18

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Figure 4. Share of aid to ARD&FS19 in total donor-funded development budget (Part I) (%). 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 1990 1995 2000 2005

32

Source: GoM annual budget statements.

Looking at the trends in the composition of aid flows to ARD&FS (see Figure 5), AidData shows an irregular pattern, with a dip between the mid-1990s and the mid-2000s, followed by a recent upward slope, especially for the agricultural production, processing and marketing (APPM) component. According to several key informants, there was an overall decline in aid receipts during this period due to donor concerns related to governance. Also, with the structural adjustment programmes (SAPs) there was a reduction in public-sector financing and thus government-service provision, which fuelled the perception that any single donor investment would have low expected returns.

19

Includes allocations to MoAFS, MoLGRD, MoNREE, MoIT and MoIWD.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Figure 5. Aid flows to ARD&FS by area of focus (1990 2008) (in million US$). APPM 250 Rural socio-economic development Emergency & welfare

33

200

150

100

50

0 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008
Source: AidData.

The largest aid recipients within APPM were by far agricultural development and agricultural policy and administration (see Figure 6). From 1998 onwards, the GBS effect also became more pronounced. Otherwise, natural resource management (land and water) and forestry have remained quite stable recipients of aid. Their inverse relationship seems to indicate a certain degree of substitution between these areas, which might reflect a fine line between sustainable forestry, land and water management interventions leading them to be classified differently between years. According to discussions with the Department of Forestry, aid to the subsector has mainly focused on policy and legislative processes, as well as restructuring in line with the wave of liberalisation and deregulation that accompanied the SAP of the early 1990s. Considerably less aid has gone to direct implementation of conservation activities and the sustainable management of forestry resources at community-level. Moreover, this type of support was mostly channelled through NGOs. The aid trends towards agricultural production inputs masks the actual donor involvement in subsidised agricultural inputs, particularly fertiliser. Although Malawi had a long history of government subsidisation of agricultural inputs, the SAPs brought along a wave of reforms, which were mostly directed at agriculture as the mainstay of the economy. The Fertilizer Farm Feeds and Remedies Act was repealed to facilitate private-sector participation in input marketing, and fertilizer subsidies were completely removed in 1995. Until recently, donors were very reluctant to support input subsidies and actively discouraged the GoM from using its own resources to do so as they argued that fertilizer subsidies were not sustainable and did not create a conducive environment for private-sector-led growth (Kumwenda and Phiri, 2010). In fact, in 1985 the World Bank made the removal of subsidies a precondition for further funding. However, since 2005, the GoM has proactively implemented the successful FISP, with increasing support from donors (DFID, EU, Irish Aid, Norway, World Bank). FISP has been praised for its contribution to five consecutive bumper harvests and a remarkable 7.4% annual growth rate in GDP in 2009.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Figure 6. Main APPM categories in terms of aid flows (1990 2008) (in million US$).

34

200 180 160 140 120 100 80 60 40 20 0 1990-1994


Source: AidData.

Agricultural development Agricultural policy and administration GBS Natural Resource Management Agricultural research, plant & animal health Forestry Fisheries Agricultural production inputs Agricultural extension & training

1995-1999

2000-2004

2005-2008

Aid to irrigation seems to have been increasing since 2005. Although AidData aggregates irrigation n combines it with water and sanitation, the positive trend in both Figure 7 and Figure 6 was corroborated by interviews and AMP data over the past three years. AfDB, JICA, World Bank and EU are investing heavily in this area, which has registered a 124% increase in disbursements between 2007/08 and 2009/10. prioritisation of irrigation in the MGDS and more recently with plans for a national irrigation programme known as the Green Belt Initiative, aimed at expanding commercial and smallholder es for national food security and export-oriented production.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Figure 7. Donor-funded development budget by ministry (1990 2008) (yearly average, %). 14.0% 12.0%
Agriculture

35

10.0% 8.0% 6.0%


Natural Resources Local Government & Rural Development Irrigation & Water

4.0%
Industry & Trade

2.0% 0.0% 1990-1994 1995-1999 2000-2004 2005-2009


Source: GoM Annual Budget Statements.

Extension, research and regulatory services have been largely undermined, with very limited aid investments since the 1990s. This is largely due to the policy shift that came with the SAPs, whereby the lack of resources), while a pluralistic approach to service provision was promoted and often integrated in holistic rural livelihoods programmes. Most of the aid to rural socio-economic development has been channelled through food-security programmes (see Figure 8). The slight increase in the total and relative allocation to rural development from 2000 to 2004 could reflect increased support to local governance and decentralisation, after the GoM launched its decentralisation policy in 1999.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

36

Figure 8. Aid flows to main rural socio-economic development categories (1990 2008) (in million US$).
200 180 160 140 120 100 80 60 40 20 0 1990-1994 Source: AidData. 1995-1999 2000-2004 2005-2008 Rural development Food security

The emergency relief and welfare component has been dominated by emergency food aid since the 1990s, with peaks during aforementioned food crises. However, the trends noted in Figure 9 point to an encouraging shift towards the prevention of malnutrition through food-based approaches. In Malawi, these interventions tend to be combined with social impact mitigation of HIV/AIDS, given the strong interactions between nutrition and HIV. From an institutional and policy perspective, nutrition and HIV have been jointly highlighted and loudly advocated for. In fact, in the MGDS, the prevention and management of nutrition disorders and HIV/AIDS was the only socially-oriented priority of six. Moreover, the fact that these cross-cutting issues have since been housed in a high-profile institutional position in the OPC demonstrates further the growing attention they are receiving from government and development partners alike. Figure 9. Aid flows to main emergency relief and welfare categories (1990 2008) (in million US$).
30 25 Basic nutrition 20 15 10 5 0 1990-1994 Source: AidData. 1995-1999 2000-2004 2005-2008 Material relief Food aid Social impact mitigation HIV/AIDS

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

37

Main sources of aid to ARD&FS


According to the Malawi Aid Atlas 2009/10 (GoM, 2011b), there are 14 donors in the agriculture sector (SWG definition), with the EU providing almost half of the total aid (see Figure 10). Ireland (12%), DFID (8%) and Norway (8%) follow at a distance. However, based on the broader definition of ARD&FS, we find that the World Bank dominates the IRD sector (64%), the trade sector (69%) and the water and irrigation sector (43%), while Japanese aid accounts for 70% of the total disbursements in the environment, lands and natural resources sector. If we consider only the irrigation projects in the water and irrigation sector, USAID disbursed the most (US$22.4 million), followed by AfDB (US$12.3 million), the World Bank (US$7.2 million) and Japan (US$2.6 million).

Figure 10. Main donors in the agriculture sector.


USAID World Bank 6% 5% AfDB 5% DfID 8%

UNDP 1% Norway 8% Japan 1%

UNIDO <1%

Ireland 12% IFAD 2% ICEIDA <1% EU 45% FICA 3%

FAO 4%

Source: Malawi Aid Atlas 2009/10 (GoM, 2011b).

Aid instruments and modalities


In its DAS, the GoM clearly spells out its commitment to the Paris Declaration and articulates its vision for aid flowing to Malawi. Although it recognises that its public financial management (PFM) system may not yet be mature enough, it requires that development partners channel at least 70% of their aid through its two preferred aid modalities, namely GBS and sector basket funding. According to the last Aid Atlas, there appears to be a shift from pooled SBS to GBS, which now accounts for 30% of total aid receipts. Although the DAS target for GBS has been met (30%), only 17% of total aid is

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

38

received through SBS. This trend is confirmed by the largest donors in the AFD&FS sector, who channel a significant proportion of their aid through GBS.20 Progress has been made in the use of government systems (see Figure 11), with a marked increase in total aid disbursed through GBS or SBS from 33% in 2007/08 to 45% in 2009/10. Nevertheless, 55% of reported aid is still delivered through direct project support and therefore outside of government structures. Although AMP recorded that 24% of total aid disbursement in 2009/10 went to NGOs, this is likely to be a gross underrepresentation of the aid flows to Malawi being channelled through NGOs. In the sectors considered ARD&FS-related in this study, most of the aid was delivered through direct project support, with the notable exception of the agriculture sector (SWG definition), where 38% of aid was disbursed through SBS to the FISP. While 26% was deposited into a pooled Food Security Account in the Reserve Bank of Malawi, 12% was considered discrete funding and typically involved donors purchasing seed and fertiliser on behalf of the GoM. An additional 24% of the total aid to the sector was received as budget support from the EU Food Facility, and therefore considered allocable to this sector. Nevertheless, aid fragmentation remains quite high with 72 projects reported in the Aid Atlas for agriculture alone.

In 2009/2010, donors signed up to the Common Approach to Budget Support disbursed the following share of their reported aid through GBS: Norway 19%; DFID 29%; AfDB 33%; World Bank 38%; GIZ 48%; and EU 71%.
20

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Figure 11. Use of country systems.

39

Source: Malawi Aid Atlas 2009/10 (GoM, 2011b).

The Aid Atlas presents a summary table of aid fragmentation by donor and by sector. The agriculture sector is the most fragmented, with 72 projects, second only to the health sector. The IRD sector is less fragmented, with 13 projects and an average disbursement of US$3.4 million per project in 2009/10, indicating larger individual projects with more critical mass. The fact that the MoAFS database of projects in agriculture, natural resources and food security contains 193 ongoing projects corroborates the perceived fragmentation, especially when more NGO-implemented projects are accounted for.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

40

Current and future trends in donor support


Recent donor-country strategic plans confirm the upward trend of aid to ARD&FS, which is expected to be sustained in the coming years, due to both the renewed international attention to agriculture a . In 2010, the United States government introduced the Global Hunger and Food Security Initiative, also known as Feed the Future, with a pledged US$3.5 billion over three years for sustainable and innovative investments in food security and rural development, as a strategic lever for the achievement of the first Millennium Development Goal. At country-level, USAID has devoted significant efforts to formulating its implementation plan, which will concentrate on high-impact nutrition interventions; the development of high-potential value chains for legumes (pigeon pea, groundnut, soybean) and dairy; and improving the policy environment with an expected US$12 15 million annual investment. 1990s, it experienced a sharp decline to less than a fifth, due to the unsatisfactory experience with the agricultural support programme in the 1990s. However, the Bank has returned to the sector and is expecting to allocate between 40 and 50% of its new Country Assistance Strategy investments to agriculture. Although DFID intends to maintain its support to FISP, it does not plan to increase its aid to agriculture directly. Rather, the new country assistance strategy proposes complementary support through enhanced access to finance, resilience, private-sector development and investments in rural roads. The EU has staged a major comeback in agriculture and rural development, with commitments doubling between the ninth European Development Fund (EDF) th million). Norway expects to further increase its relative contribution to agriculture (through climate change) over the coming years, based on its global policy to focus on a limited number of focus areas. Irish Aid just officially opened its development portfolio in 2010, with the overall aim of ensuring that households are better nourished, food secure and less vulnerable to poverty. Evidently, agriculture, food security and resilience (welfare and nutrition measures) occupy a central place in this strategy .

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

41

Assessment of the quality of aid information


Accessibility, accuracy and comprehensiveness of data on aid to ARD&FS
Information on aid to ARD&FS is quite easily accessible as the key databases (AMP, PSIP and MoAFS Technical Secretariat) are or will soon be available online. The MoAFS Technical Secretariat database can be freely downloaded from the MoAFS website. Although PSIP and AMP (will) only allow registered users to access the databases, the data are made available upon request. Moreover, the annual reports produced by PSIP and DAD are distributed widely, especially the Aid Atlas, which is sent around to all government institutions and donors. Indeed, DAD is particularly dedicated to full transparency. However, even though recent data for the past four or five years are readily available, comprehensive aid data before 2007 are difficult to access in a user-friendly manner. The aid data captured in the national development budget (Part I), although not representative of total aid flows, are . AMP is a reliable source of aid data since 2007/08 and the reliability of the data is continuously improving over the years as more donors report in a timely and accurate fashion. For this purpose, data focal agents (DFAs) were established and trained in each resident donor agency to submit aid flow data. In 2009/10, all 28 bilateral and multilateral donors in Malawi reported to the MoF, which is quite a feat for aid transparency. DAD indicated that the accuracy of the reported data varies by donor, rather than by sector. That being said, AMP data have certain weaknesses related to the fact that only disbursements are recorded, for lack of reliable expenditure data; only flows from resident donor agencies are captured, while a considerable amount of aid passes through other donors or other levels (headquarters, regional offices, NGOs); internal definitions, leading to certain discrepancies when it comes to the aidfragmentation analysis. exemplifies an integrated rural development programme. This is principally implemented by the MoAFS, and is classified by AMP in four separate projects under the agriculture and IRD sectors. Also, the fact that AMP automatically allocates each project to a sector, depending on its implementing line ministry, has led to a Norwegian project supporting Bunda College of Agriculture on conservation agriculture initially being classified as an education-sector project. Although such details are modified on a case-by-case basis, it is likely to affect the ARD&FS sector more than others, given the many grey areas and arguable sector boundaries. Another limitation in terms of accessibility to comprehensive ARD&FS data is that AMP data do not allow for an easy disaggregation of aid to irrigation from the total aid to the water, sanitation and irrigation sector, just as nutrition projects cannot be easily disentangled from aid to the health sector. Although PSIP serves as a vital instrument for managing the development budget, certain challenges undermine its accuracy and credibility. Most importantly, PSIP tells only part of the story when it comes to the national development budget. A recent study found that the PSIP budget was consistently different from the total development budget between 2004/05 and 2009/10. For most of

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

42

the years, except the last, the PSIP budget exceeded the development budget by up to 31%. AMP has further highlighted the gaps in the PSIP and development budgets. The major reasons for these discrepancies were found to lie in the use of different programme classifications and cost centres, and in differences in timing of the budgetary and PSIP processes leading to the use of indicative ceilings in the former and actual ceilings in the latter. More generally, the study observed a serious lack of coordination between the MoDPC and the MoF, as well as between MoDPC and line ministries. In order to address these issues, JICA is supporting the Capacity Enhancement in Public Sector Investment Programming project to harmonise the data contained in PSIP, the national development budget and AMP. The MoAFS Technical Secretariat database is the only database that has managed to capture a representative number of projects in the sector, including those implemented by NGOs. Despite repeated requests, the Technical Secretariat has not been able to elicit data on projects being supported by research institutions, regional donors, non-resident donors or donor headquarters. Moreover, when it comes to aid flows, the database captures only overall project commitments, but does not contain annual disbursements or expenditures. Currently, the database cannot be easily used to analyse the total number of donors or implementing agencies in the sector due to the lack of a coding system. Moreover, as projects have not yet been coded by thematic component, it does not lend itself to an analysis of projects, investments, donors or implementers by component. It would appear to be the only database with this potential however, as AMP and PSIP maintain higher-level classifications (be it SWGs or MGDS priority areas). Although its purpose was more geared towards harmonisation and coordination, this database could be built on within the context of ASWAp to provide clear sector-wide data on who is doing what where, and also how much is being invested in what focus areas. The recurrent challenge of collecting aid disbursements from NGOs undermines the aid management systems in terms of their comprehensiveness. The MoDPC did attempt to create a database of NGOimplemented projects, but after investing considerable human and financial resources in this effort, the high rate of non-response from seemingly sceptical NGOs led to the abandonment of the initiative. Although this is perceived as a major gap in the data, it is also considered a diversion from the core functions, especially in light of their limited resources.

Consistency of aid trends with stated g


Another quality dimension of aid data is whether they tell the same story as the policies do. It is therefore worth analysing the trends in committed aid flows to ARD&FS depicted in Overview of aid flows to ARD&FS against the broad evolution of GoM policy and strategies, as well as donor priorities. Agriculture has been a priority sector since independence and was always perceived as the engine of economic development. Large investments in state-managed agricultural development and marketing were curtailed in the 1980s, as part of the SAPs, promoting the liberalisation of the sector, price decontrol, the reform of parastatal entities (such as the Agricultural Development and Marketing Corporation [ADMARC]21 and forestry plantations), privatisation, trade liberalisation,

21 ADMARC is a government-owned marketing board for agricultural produce.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

43

financial-sector reform, exchange-rate and interest-rate liberalisation and the rationalisation of the budget. This overall deregulation of the sector should be led by the private sector explains the negative trend in aid to ARD&FS in the 1990s, especially looking at the DAC AFF sector definition. This was coupled with an increase in relative government and aid allocations to the social sectors (health and education). As part of this restructuring of the gove government was largely concentrated on liberalisation policy and legislative processes. For example, USAID provided support to a divestiture programme to reduce the control and inefficient activities of ADMARC and played a lead role in advocating for the removal of restrictions preventing smallholder farmers from engaging in the production and marketing of export-oriented cash crops, such as burley tobacco. Further, development aid was increasingly channelled through NGOs as donors adopted and (2000) and forestry policy (1996) confirm this shift towards a greater recognition of non-state actors and service providers, as well as the role of communities themselves in the uptake of technologies and the sustainable management of natural resources. Although this might not be directly visible in the available aid data, it could be inferred from the increasing aid being channelled to food security programmes (under RSED) and emergency and welfare programmes for nutrition, which have tended to be dominated by non-governmental providers.

Table 7. Period 1987 95 Key policy documents Statement of Development Policies (1987 1996)

ARD&FS strategy. Strategic focus Liberalisation of the agricultural sector, parastatal sector reform, privatisation, reduced government intervention and service provision, deregulation, trade liberalisation, financialsector reform, exchange-rate liberalisation, interest-rate liberalisation and rationalisation of the budget Targeted middle-income smallholder group Shift of focus from estate development and middle-income farmers to addressing the needs of resource poor and marginalised smallholders Stronger rural livelihoods emphasis Recognition of role of non-state actors and communities in service provision and natural resource management Decentralisation and local governance Shift from social consumption to sustainable economic growth and infrastructure development Re-prioritisation of agriculture and food security through maize self-sufficiency and government intervention Key role for private sector in economic growth

1995 2000

Agricultural and Livestock Development Strategy and Action Plan since 1995 Vision 2020 since 2000 Malawi Poverty Reduction Strategy (2002 05) Malawi Economic Growth Strategy (2004 06) Malawi Growth and Development Strategy (2006 11) Agriculture Sector-Wide Approach (ASWAp 2010 14)

2004 11

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

44

The Agricultural and Livestock Development Strategy and Action Plan (ALDSAP), launched in 1995, marked a shift from a focus on estate development to tailored interventions addressing smallholder the Second Statement of Development Policies (DEVPOL) targeted the middleincome smallholder group to strengthen the institutional capacity to deliver technical services, ALDSAP was more encompassing of resource-poor and marginalised farmers, including women. The change in focus areas from livestock and fisheries production in DEVPOL to an emphasis on crop production and soil-fertility improvement and enhancement is not reflected in the aid trends. This might be due to the fact that detailed coding is rare, as most donors lump their agriculture projects under the agricultural development DAC purpose code. However, smallholder cash cropping received support under the USAID Agricultural Sector Assistance Programme and the Af Macadamia Project and from Germany. At the end of the 1990s, there was still no evidence of significant reductions in rural poverty, leading to a donor focus on resource-poor farmers and income- and productivity-enhancement measures (Charman, 2004). This could partially explain the increase in aid allocated to rural development programmes between 2000 and 2004. Another likely reason would be the response of donors to the national decentralisation policy of 1998, which required support in terms of institutional strengthening and capacity building at local-government level. Overall, during the late 1990s and early 2000s, GoM cushioning the negative effects of market reforms and underperformance, as the structural adjustments did not reduce poverty or enable economic growth. Having experienced the limitations and inadequacy of the SAPs, the GoM devised its Vision 2020 at the turn of the century, followed by the Malawi Poverty Reduction Strategy (MPRS) and the MGDS in which agriculture and food security became key public concerns requiring ongoing public intervention. The MPRS strategies went beyond addressing the supply side (production support and market access) and included the human capital components of rural poverty (health, welfare support and empowerment). While neither DEVPOL nor ALDSAP had explicitly articulated the need for long-term investment in safety nets, the MPRS fully recognised the need for safety nets to deal with chronic food insecurity and minimise food aid receipts. Since then, a series of agriculture-based safety-net programmes were introduced, such as the small-scale starter packs, the World Bank-funded Agricultural Productivity Improvement Programme and the Target Input Programme (1998 2001), with some donor support. However, donors generally considered subsidies to be unsustainable and were therefore reluctant to invest in them. With two alarming food crises in 2001/02 and 2004/5 and strong government commitment, -intensive FISP since 2005/06, as well as its larger agricultural investment initiatives, such as in irrigation. This is confirmed by AMP data, with aid disbursements to agriculture increasing from US$51.2 million in 2007/08 to US$90.4 million in 2009/10. GBS also increased from US$94 million to US$209 million in the same period, translating donors . While smallholder agriculture was central to the MPRS, large farmers and private businesses have taken centre stage in the Malawi Economic Growth Strategy and the MGDS. In practice, however, the GoM is investing heavily in smallholder food security through FISP, which consumes the bulk of the government agricultural budget and a significant share of total donor support. According to AMP, in 2009/10 US$34 million out of US$90.4 million total aid to agriculture was directly allocated to FISP, representing about 40%.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

45

Another important policy shift was a realisation in 2005 that efforts had been locked up in dealing with food crises, while there was an urgent need to take a medium- to long-term perspective (Kumwenda, 2010). The absence of a comprehensive and prioritised investment framework in the agricultural sector was thought to have contributed to limited donor buy-in. While efforts began in the late 1990s to establish such a framework through the Malawi Agricultural Sector Investment Programme, the process was endlessly delayed, to only materialise in the last few years with the official endorsement of ASWAp in 2010. Donors were intensely involved in this process and have pledged their commitment to ASWAp objectives and priority areas, as part of the CAADP process. This renewed commitment and confidence in the agriculture sector is likely to be visible in the aid volume over the next few years, but it could also be captured by current country-level systems as a shift in aid modalities used. Currently, several donors in the agriculture sector (including EU, FICA and Norway) have plans to channel part of their support through a multi-donor trust fund, administered by the World Bank, in support of an expanded version of the ASWAp-Support Project, which was initiated in 2008 to build capacity for and kick-start ASWAp implementation.

Mutual accountability and results focus


In the context of aid effectiveness, there are two main avenues for mutual accountability between the GoM and its development partners, namely MGDS annual reviews and CABS reviews. The accountability of government and donors to the ultimate aid beneficiaries has less clearly defined mechanisms, although it is starting to be taken into consideration by Malawian civil society in its budget analysis and advocacy efforts. Building on the six priority areas and five themes, the MGDS includes an M&E framework to assess progress towards the achievement of its national goals. For the past three years, the MoDPC has led MGDS annual reviews to monitor the performance of all economic and social programmes to enhance management for results and accountability. The consolidated annual review report is based on sector-specific reviews that provide a forum for policy dialogue, coordination and joint assessments between the government and its development partners. These reviews consider results performance per sector, budget performance and aid-effectiveness performance. PSIP data feed directly into this process, as each sector assesses its development projects output performance against project targets. AMP data are used to assess the degree of donor harmonisation and alignment to government procedures in each sector, based on 11 PD indicators. The annual reviews provide the opportunity to analyse the link between resource inputs and intended development outcomes and results. It is in principle possible to compare budget utilisation rates to weighted performance on sector output indicators, but given the generally weak M&E framework it might not be a very meaningful exercise. The MGDS review per sector is currently the best attempt at sector-wide M&E and accountability given that government, NGO and development-partner projects are all considered, if voluntarily reported. While the reviews often provide useful recommendations per MGDS priority area and theme, there is limited follow-up from one year to the next. Furthermore, the fact that MGDS is owned by the MoDPC, while DAS is owned by the MoF partly contributes to the current disconnect between development inputs and the analysis of results. In the 2008/2009 agriculture sector review, three out of the 11 PD indicators were considered unsatisfactory, i.e. the use of country procurement systems, avoiding parallel PIUs and the use of common arrangements and procedures. One of the key recommendations by the sector was to

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

46

redefine the agriculture sector to include irrigation, forestry and fisheries and agricultural education and training. A call was also made to non-state actors (NGOs and private sector) to submit their performance reports as part of these sector-wide reviews as their contribution to the sector cannot be ignored. In the IRD sector, six PD indicators were rated unsatisfactory and one was very unsatisfactory (use of country procurement systems). Indeed, this sector lacks an operational sector strategy and results framework, contributing to a high degree of parallel PIUs and off-budget donorfunded projects. To increase aid effectiveness through timely project implementation, DAD also conducts quarterly monitoring visits to externally-funded projects and produces quarterly reports. The ultimate goal of these monitoring exercises is to improve the Country Portfolio Performance Rating (CPPR) 22 and thereby the Resource Allocation Index23 for future funding cycles, by reducing the number of overaged and non-performing projects. Delayed project implementation increases commitment charges for aid, bloats operational costs and ultimately diverts resources from other priority areas. Projects are assessed mainly against input and output indicators and corrective measures are identified to address bottlenecks. This exercise is limited to 30 sampled on-budget projects with large budgets (more than US$10 million), delays in implementation and low disbursement rates (less than 30%). GBS and pooled funding are also analysed as part of this process based on AMP data and reporting functions. The CABS group, currently comprised of DFID, the World Bank, EU, Norway, GIZ and AfDB, has been providing GBS to the GoM since 1999. A joint framework for budget support cooperation between the government and the CABS group was signed in 2005, building upon the MGDS. The CABS group conducts bi -agreed Performance Assessment Framework (PAF) targets, as the basis for future disbursements. These reviews also allow for a joint assessment of how CABS funds have been utilised. The current PAF has 25 indicators with 42 targets covering PFM (9 indicators), alignment and mutual accountability (1), economic growth (3), social sectors (7), and governance (5). The following three indicators are related to economic growth: (i) improved business environment (contract enforcement and business licensing); (ii) improved function of agriculture output markets; and (iii) improved functioning of agricultural input markets.24 The achievement of PAF targets triggers the disbursement of aid, while their nonachievement has caused delays or freezes. The Parliamentary Committee on Agriculture and Natural Resources fulfils an oversight and monitoring role of government allocations to MoAFS, MoIWD, MoNREE and the Ministry of Lands, Housing and Urban Planning. Interestingly, MoLGRD is under the remit of the Parliamentary Committee on Social Welfare. Although the committee assumes these roles, it does not feel that it has adequate oversight of aid flows to agriculture and natural resources, other than the totals of the development budget per part. Moreover, budget documents are not received before the parliamentary

22

Bank-financed portfolio in client countries.


23

Institutional Assessments (CPIA) exercise that covers the IDA-eligible countries. The CPIA rates countries against a set of 16 criteria grouped in four clusters: (a) economic management; (b) structural policies; (c) policies for social inclusion and equity; and (d) public sector management and institutions. 24 The targets related to the latter two indicators were not met in the past year.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

47

sitting to allow for adequate time, reflection and discussion among committee members. Although the MoF has made ad hoc presentations of the Aid Atlas to members of parliament, this does not appear to have been institutionalised and few have had access to the Aid Atlas reports or AMP data. The Malawi Economic Justice Network (MEJN ) mandate includes analysing the national budget to ensure that it is consistent with national priorities and is geared towards financing pro-poor activities. MEJN therefore tracks all ODA disbursed as budget support, as well as aid disbursed outside the budget through service delivery surveys and other social accountability approaches. The thrust is to ensure that resources are used for their intended purposes and in a transparent manner. For ODA disbursed through the national budget, MEJN conducts budget analysis soon after presentation in parliament, analysing Part I allocations to the various sectors, as well as the conditions attached to aid. Despite these efforts, official mechanisms for civil-society involvement in aid effectiveness accountability forums remains ad hoc and mostly take the form of meetings where civil-society organisations are invited as and when government and/or donors deem it necessary. However, in the past three years, there has been an increased recognition of civil society involvement in CABS reviews, which has provided space for civil-society input into aid discussions. With the view of strengthening this engagement, MEJN has received support from the EU to devise mechanisms for piloting a systematic dialogue on aid between civil society, the government and the EU. Guidelines have been developed for this envisaged engagement, but they are yet to be endorsed. The Civil Society Agriculture Network (CISANET) engages in similar budget analysis and advocacy, with a particular focus on agriculture, irrigation and agricultural marketing. Once the budget is presented to parliament (incorporating [part of] AMP and PSIP data) these components and discusses its concerns with the Minister of Agriculture and Food Security or the Minister of Irrigation and Water Development. Until two years ago, CISANET also used to conduct public expenditure tracking surveys and community development satisfaction surveys at the level of extension planning areas (EPAs) to track whether funds were disbursed as planned by the decentralised authorities and to assess community satisfaction.

Alignment of data provision with government planning and accounting requirements


Aid predictability is a fundamental objective of the aid-effectiveness agenda, as it is central to effective medium-term planning and budgeting. Donors are therefore expected to provide indicative multi-annual commitments in the context of national medium-term expenditure frameworks. The timely disbursement of aid is now one of the indicators donors are measured against in the Malawi Aid Atlas. The GoM is particularly interested in increasing the predictability of GBS and SBS, given their direct bearing Overall, the predictability of GBS was quite high in 2009/10, as the underfunding of AfDB and DFID (respectively 82% and 86% of original commitments) was compensated by the overfunding from the World Bank and the EU (30% and 25% respectively). In SBS to ARD&FS, Norway did not disburse its commitment to FISP due to delays in finalising the audit report for the programme from previous years, while Irish Aid provided 260% of its commitment. Although improvements have been made, many donors have internal constraints preventing them from providing official commitments for the coming fiscal year, let alone the upcoming three years, as required for forward budgeting. The different fiscal years used by donors and the GoM partly accounts for the delays in providing commitments. However, government and donors have found ways to accommodate each other, with different donors disbursing their budget

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

48

support during different previously-agreed quarters. For projects, it has been relatively more straightforward to collect annual commitments. The monthly data collected by the MoF for AMP allow DAD to provide weekly reports to the Acco for cash-management purposes. The fact that AMP generates a full list of donor-funded projects by sector is also proving useful for sectors in their planning efforts. Indeed, DAD receives demands on an ad hoc basis from sectors for their AMP data. While AMP has been successful in collecting data on aid disbursements, expenditure data are less easily accessible. The MoF uses the computerised Integrated Financial Management Information System (IFMIS) to monitor expenditure, linking the Treasury with the Reserve Bank of Malawi and line ministries to ensure timely reconciliation of accounts. The Budget Division and DAD are engaged in an effort to integrate donor-funded projects into the IFMIS, which would allow the expenditures under all donor-funded projects to be tracked in the same way as government expenditures. Until then, the MoF still relies on its quarterly M&E exercises to monitor project expenditure rates. However, these exercises are being undermined by a high rate of non-response from development partners and project managers, which might again be a result of the fragmentation and lack of coordination between MoF and MoDPC, as well as line ministries (e.g. MoAFS Technical Secretariat) causing a questionnaire/survey fatigue.

Donor harmonisation
Although all donors indicated that AMP data and Aid Atlas reports are a very welcome development and a good starting point for discussions amongst donors, in reality few reported using the data for planning purposes. However, country strategic plans all include some analysis of the developmentaid context and the major donors per sector. In fact, in its country plan for 1995 2000, USAID analysed past aid commitments from multilateral and bilateral donors, based on da development cooperation report and from the UNDP management information system Donor Aid Classified by Grant and Loan. Before AMP, most donors used aggregate aid data from the MoF, as well as information collected bilaterally amongst themselves. Country strategic plans included a section on aid effectiveness and donor harmonisation, including an overview of which donors were in which sectors and what their future plans were. Most of this data had to be sourced separately by each donor, but more recent country assistance plans, such as the one of Irish Aid, refer to AMP data and Aid Atlas analyses. Interestingly, even the analysis of major ongoing investments in the agriculture sector in the ASWAp document does not make use of the data contained in project database. Only PSIP projects appear to have been listed in this category, even though the framework is supposed to go beyond the public sector and be an instrument for harmonisation. Generally, donors are very aware of which other donors are active in the sectors they work in and which are relatively larger in terms of aid volume. More relevant information for planning within a sector is the details of aid per thematic component and implementing partner. In the agriculture sector, DCAFS has recently commissioned a study to document individual donor funding plans and explore mechanisms for accelerating donor harmonisation in the sector. The report is yet to be released, but it definitely went beyond AMP data.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

49

More broadly, given the high degree of donor concentration in a few sectors, it is clear that donors are not guided by the overall picture of darling and orphan sectors. In fact, there tends to be a crowd in certain sectors, such as agriculture. Moreover, donors tend to have their own globally determined sectors of comparative advantage, but will be willing to harmonise and coordinate support within a sector to avoid duplication. Certain donors and NGOs have found the MoAFS project database to be particularly useful for this purpose.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

50

Examples of good practice


Clearly, AMP represents a good practice on several fronts, starting with effectively collecting and tracking information on aid flows. Indeed, AMP allows for regular aid tracking and reporting, which serves the public financial management, while also serving the external reporting and transparency. Set up in 2008, AMP builds on earlier efforts, while having several additional benefits: A project is entered once, then updated with disbursements (monthly) and projections (at the start of each financial year) Specific reports can easily be produced over several years with the latest data and ad hoc reports can be produced upon request Reserve Bank of Malawi exchange rates are automatically plugged into the system Manual error is significantly reduced.

Essentially, AMP dramatically reduced the time burden for aid-data analysis and management, and made it simpler to respond to data requests, thereby increasing the accessibility and usability of the data. Indeed, DAD in the MoF, MoDPC and MoAFS have adopted a transparent attitude to the data they manage and are very open to sharing the data upon request. Additionally, the MoAFS project database is entirely accessible online to the public. Another good practice is that of aid-data accuracy , thanks to a very good cooperation between donors and the MoF. Indeed, at the moment all 28 resident donors report their disbursements in a timely manner to the GoM. This is partly a result of the name-and-shame approach adopted in the Aid Atlas reports, with the very first table presenting reporting behaviour by donor. In addition, the accuracy of the data reported has been further enhanced by the prior training provided for DFAs in each resident donor agency. In the 2011/12 budgeting cycle, AMP data have also started playing a critical role in public financial management , as AMP aid projections are now used to determine budget ceilings for line ministries and departments both in terms of the development budget Part 1 funding (on-budget project aid), as well as the recurrent budget and the development budget Part 2 funding (through GBS and SBS). That being said, AMP has done less well in terms of capturing the cross-sectoral nature of agricultural policy. To be fair, AMP simply follows the sector classification determined by the MoF in the context of its DAS. Due to the vested interests of each line ministry, the consensus reached was to have 16 SWGs, although this appears excessive. As a result, the ARD&FS domain has been spread across at least five SWGs, rendering an analysis of aid flows to this domain particularly difficult. Although this would not be an issue if in line with the national policy framework, the agriculture sector has defined its boundaries much more broadly in its ASWAp, taking into account food security, agricultural risk management, sustainable agricultural land and water management (including irrigation and agroforestry), commercialisation and market development, agricultural extension and research, institutional strengthening and agriculture-related gender and HIV/AIDS issues. However, in the absence of an aid data management system in line with the ASWAp, it is unclear whether this comprehensive definition will be used in tracking and analysing aid flows against ARD&FS policies and outcomes.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

51

A good practice worth mentioning in the neglected area of accountability between recipient governments and their citizens, is the increasing role of civil society in budget analysis and tracking (including on-budget aid). In the agriculture sector more specifically, the overarching role played by the MEJN in budget analysis is further reinforced by the efforts and advocacy of CISANET.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

52

Conclusion
Agriculture is the mainstay of economy and about 85% of the population is rural. Over the past two decades, the country has been plagued by food crises and, despite recent improvements, the people of Malawi are still suffering from chronic malnutrition. In this context, the domain of agriculture, rural development and food security (ARD&FS) has received considerable attention from government, NGOs and donors alike. With foreign aid representing 11% of GDP, Malawi is an aiddependent country. This country study has sought to assess the quality of aid data and identify best practices in measuring and accounting for aid to this broad domain. In order to assess the consistency between policies and aid allocations, the study used data on aid collected internationally over the past 20 years to analyse trends. Overall, the volume of aid to agriculture, rural development and food security appears to have declined between the early 1990s and 2008, despite a slight upward trend since the mid-2000s. In relative terms, the proportion of total aid going to ARD&FS has also decreased, after a peak in 1992 (severe drought), but seems to be staging a slight comeback since 2004/05, when Malawi experienced another alarming food crisis. The data further reveal a heavy bias towards agricultural policy and administration and agricultural development, or more likely a tendency to cluster agriculture-related support under these generic purpose codes. The categories of emergency food aid, food-security programmes and basic nutrition seem to explain most of the recent increase in aid. As for aid characteristics beyond volume, such as type of aid, aid modalities or aid recipients and implementers (government, NGO, private sector), these have been less well captured in the existing data at international level. However, the data do illustrate the increasing importance of GBS as a contribution to this sector. Ministry of Finance (MoF) and the explicit prioritisation of agriculture for economic development. Although these time-series trends could only be analysed with data at the international level, Malawi initiated its own aid data management systems in the mid-2000s, and these have already greatly facilitated aid tracking, budget planning and coordination in general and in the ARD&FS domain in particular. The Aid Management Platform (AMP) was established in 2008 for aid tracking, reporting and analysis. Housed in the Debt and Aid Division of the MoF, AMP contains all programmes and projects funded by resident donor agencies, as well as their monthly disbursements, annual projections, lead implementing agency and sector, type of funding and alignment to country systems. The MoF produces annual Aid Atlas reports, which include analyses of aid volumes, modalities, predictability and fragmentation, by donor and by sector. All 28 resident donors are reporting to the MoF in a timely and accurate manner, enabling the database to currently capture 837 programmes and projects across the 16 sectors, implemented by 109 implementing agencies. The Public Sector Investment Programme (PSIP) is a tool to plan and manage the national development (capital) budget, in line with the national development strategy (the MGDS). It directions and links them to available financing mechanisms. The PSIP database consists of a

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

53

list of investment programmes and projects funded by government-guaranteed loans, grants and own resources, in the form of five-year rolling plans. It currently contains 233 projects, funded by 25 external donors and implemented by 32 public institutions. The Ministry of Agriculture and Food Security (MoAFS) Technical Secretariat database was developed in 2004, upon the request of the Food and Nutrition Security Joint Taskforce, in order to track who was doing what in Malawi in the area of food security and nutrition at project level. The purpose was for such a regularly updated database to serve as a basis for coordination and harmonisation in the sector. It currently contains 193 projects, funded and implemented by over 80 different donors and implementers.

Several strengths have been observed in each system, such as the very good accessibility of aid data (on line or upon request) and the accuracy of most of the disbursement and projection data provided, especially to AMP. Donors appear to have aligned themselves to the aid-data requirements of the government, providing monthly disbursements and annual projections, particularly for donors providing general budget support and sector budget support. As a result of this very good collaboration, the aid data in AMP are now being used for budget planning (including setting development budget ceilings) and cash management. Moreover, PSIP data are being used to analyse the consistency between government (MGDS) priorities and development budget allocations (government and donor-funded). Civil society has also taken up a key role in budget analysis and tracking to hold government accountable for its use of tax and donor resources. Nevertheless, there are still a number of remaining challenges in terms of handling aid data in general, and aid to ARD&FS in particular.

Different definitions : while AMP uses a narrow definition of the agriculture sector (excluding
land and natural resources, irrigation, integrated rural development, trade and nutrition), the MoAFS has recently adopted the agriculture sector-wide approach (ASWAp) framework, which embraces food security and nutrition, commercialisation and market development, sustainable agricultural land and water management and agriculture-related gender, HIV and climate-change issues. While donors in the agriculture sector are able to relate their internal classification to the ASWAp definition, AMP remains the primary aid data management system and aid effectiveness monitoring tool. Weak linkages between ministries and aid data management systems: as the three systems were set up with different purposes, resources and institutional homes, there has been a recognised lack of coordination. This has led to discrepancies between the national development budget produced by the MoF and the PSIP, for example, which should be one and the same. Moreover, as similar data are currently being requested from the MoF and the MoAFS for their databases, there is a risk of a reduced response rate due to survey fatigue. Tracking aid channelled through NGOs and the private sector: although donors have an obvious incentive to fully report their aid disbursements to the sector, NGOs and the private sector have less incentive to do so. As a result, aid being channelled outside the public sector has proved extremely difficult to track reliably. The MoAFS database has succeeded in providing government and NGOs with information that they are interested in on almost all projects in the agriculture, food security, nutrition and natural resources domain. However,

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

54

specifics on quarterly or annual aid disbursements and modalities are not available through this implementer-driven database. Tracking expenditures: It is a major challenge to track expenditures, as most donors do not receive reliable or timely expenditure data from their recipients. Efforts are now being made to link all donorIntegrated Financial Management Information System for such real-time expenditure tracking. Limited use of data produced for government and donor planning: as the guiding investment framework for the sector, it is striking to note that the ASWAp only refers to PSIPlisted projects in its analysis of ongoing investments in the sector and not to the Aid Atlas analyses of aid effectiveness in the sector, nor its own sector-wide and more inclusive project database. disbursements to the sector, but rather by their own priorities (or areas of comparative advantage). Limited analysis of aid data (inputs) against development outcomes : although the MGDS annual reviews represent an attempt to link development inputs and outputs and thereby assess the effectiveness of the development strategy, the weakness of the MGDS monitoring and evaluation framework seems to be constraining these efforts. Furthermore, the focus in terms of aid effectiveness per sector tends to be on Paris Declaration process indicators, rather than on linking overall inputs to development outcomes and eventually impact.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

55

References
AfDB (African Development Bank) (2005) Malawi 2005 2009 Country Strategy. Country Operations Department, North, East and South Regions. Batten, A. (2010) Aid Information Management in Practise Conference, 6 December 2010. Malawi experience. Presentation at the ICGFM Winter

Charman, A.J.E. (2004) Agricultural Development and Food Security in Sub-Saharan Africa Building a Case for More Support: Malawi Country study detailed findings. FAO Agriculture Policy Analysis Unit (SAFP): Harare. Chirwa, E.W., Kumwenda, I., Jumbe, C., Chilonda, P. & Minde, I. (2008) Agricultural growth and poverty reduction in Malawi: Past performance and recent trends. ReSAKSS Working Paper No. 8. International Crops Research Institute for the Semi-Arid Tropics (ICRISAT), International Food policy Research Institute (IFPRI) and International Water Management Institute (IWMI). Development Gateway (2009), AMP Malawi, In Brief. Development Gateway and UNDP: online. DFID (Department for International Development) (2002) Malawi Country Assistance Plan 2002/03 2005/06. DFID Malawi: Lilongwe. DFID (Department for International Development) (2008) Malawi Country Assistance Plan 2008 2011. DFID Malawi: Lilongwe. Durevall, D. & Erlandsson, M. (2005) Public Finance Management Reform in Malawi. Sida Country Economic Report.

Embassy of Ireland (2010) Malawi Country Strategy Paper 2010 2015. Embassy of Ireland: Lilongwe. GoM (Government of Malawi) (1999) Review of Malawi Agricultural Policies and Strategies. Ministry of Agriculture and Irrigation: Lilongwe. GoM (Government of Malawi) (2000) Vision 2020. The National Long-term Development Perspective for Malawi. A Summary. National Economic Council: Lilongwe. GoM (Government of Malawi) (2001) Malawi 2000 Public Expenditure Review. Ministry of Finance and Economic Planning: Lilongwe. GoM (Government of Malawi) (2002) Malawi Poverty Reduction Strategy Paper. Ministry of Finance and Economic Planning: Lilongwe. GoM (Government of Malawi) (2003) Malawi Economic Growth Strategy. Ministry of Economic Planning and Development: Lilongwe.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

56

GoM (Government of Malawi) (2004) Transitional Public Sector Investment Programme (PSIP), 2004/05 2008/09. Ministry of Economic Planning and Development: Lilongwe. GoM (Government of Malawi) (2005) A New Agricultural Policy. A Strategic Agenda for Addressing Economic Development and Food Security in Malawi. Ministry of Agriculture: Lilongwe. GoM (Government of Malawi) (2006) Malawi Growth and Development Strategy. From Poverty to Prosperity, 2006 2011. Ministry of Finance: Lilongwe. GoM (Government of Malawi) (2007a) Malawi Development Assistance Strategy 2006 2011. Ministry of Finance: Lilongwe. GoM (Government of Malawi) (2007b) Malawi Growth and Development Strategy, Annual Review 2006/07 Year, Synthesis Report. Ministry of Economic Planning and Development: Lilongwe. GoM (Government of Malawi) (2008a) Institutionalizing Sector Working Groups (SWGs) to Strengthen the Implementation of the Malawi Growth and Development Strategy (MGDS). Ministry of Finance and Ministry of Economic Planning and Development: Lilongwe. GoM (Government of Malawi) (2008b) Malawi Growth and Development Strategy, Annual Review 2008. Ministry of Economic Planning and Development: Lilongwe. GoM (Government of Malawi) (2008c) The Public Sector Investment Programme (PSIP), 2008/09 2012/13. Ministry of Development Planning and Cooperation: Lilongwe. GoM (Government of Malawi) (2009a) Malawi Aid Atlas 2007/08 FY. Ministry of Finance: Lilongwe. GoM (Government of Malawi) (2009b) Malawi Growth and Development Strategy, Annual Review 2009. Ministry of Development Planning and Cooperation: Lilongwe. GoM (Government of Malawi) (2010a) Agriculture Sector Wide Approach. Ministry of Agriculture and Food Security: Lilongwe. GoM (Government of Malawi) (2010b) Malawi Aid Atlas 2008/09 FY. Ministry of Finance: Lilongwe. GoM (Government of Malawi) (2010c) PSIP User Manual for Line Ministry. Ministry of Development Planning and Cooperation: Lilongwe. GoM (Government of Malawi) (2010d) Quarterly Aid Disbursements Sector Report, July September 2009. Ministry of Finance, Debt and Aid Division: Lilongwe. GoM (Government of Malawi) (2010e) The National Agricultural Policy, July 2010 Draft. Ministry of Agriculture and Food Security: Lilongwe. GoM (Government of Malawi) (2010f) The Public Sector Investment Programme (PSIP), 2010/11 2014/15. Ministry of Development Planning and Cooperation: Lilongwe. GoM (Government of Malawi) (2011a) The 2010/11 Mid-year Budget Review. Ministry of Finance: Lilongwe.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper
GoM (Government of Malawi) (2011b) Malawi Aid Atlas 2009/10 FY. Ministry of Finance: Lilongwe. GoM and EC (Government of Malawi and European Community) (2001) Country Strategy Paper and Indicative Programme for the Period 2001 2007. GoM and EC (Government of Malawi and European Community) (2008) Country Strategy Paper and Indicative Programme for the Period 2008 2013. GoM and JICA (Government of Malawi and Japan International Cooperation Agency) (2009) Public Sector Investment Programme (PSIP) and Development Budget Comparison. Technical Report no. 1. Capacity Enhancement in Public Sector Investment Programming Project: Lilongwe.

57

GoM and JICA (Government of Malawi and Japan International Cooperation Agency) (2010) Proposal on the further improvement of PSIP preparation procedures. Technical Report no. 2. Capacity Enhancement in Public Sector Investment Programming Project: Lilongwe. Kumwenda, I. (2010) Development of Agricultural Sector Wide Approach (ASWAP) in Malawi: Processes, Major Players and Lessons. Submitted to the International Food Policy Research Institute. Kumwenda, I. & Phiri, H. (2010) Government interventions in fertilizer markets in Malawi: from 1994 2009. A literature review.

Njiwa, D., Kumwenda, I., Thindwa, I., Chilonda, P., Olubode-Awosola, O. O. & Davids, A. (2008) Monitoring trends in public spending on agriculture: The case of Malawi. ReSAKSS Working Paper No. 9. International Crops Research Institute for the Semi-Arid Tropics (ICRISAT), International Food Policy Research Institute (IFPRI) and International Water Management Institute (IWMI). Norad (2007) Common Approach to Budget Support (CABS) in Malawi. Norad Collected Reviews. United States Government (2010) Malawi FY2010 Implementation Plan, US government initiative, See, Feed, Change the Future [online]. USAID (United States Agency for International Development) (1994), Country Strategic Plan 1995 2000. USAID Malawi: Lilongwe. USAID (United States Agency for International Development) (2000), Country Strategic Plan 2001 2005. USAID Malawi: Lilongwe. World Bank (2003) The Republic of Malawi, Country Assistance Strategy. Report No. 25906 MA1. World Bank (2007a) Project Performance Assessment Report. Emergency Drought Recovery Project no. 39849. World Bank (2007b) The Republic of Malawi, Country Assistance Strategy. Report No: 38326 MW.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

58

Annex 1: ARD&FS definitions used in this study


OECD-DAC purpose code 12140: Basic nutrition Clarification on coverage Direct feeding programmes (maternal feeding, breastfeeding and weaning foods, child feeding, school feeding); determination of micronutrient deficiencies; provision of vitamin A, iodine, iron etc.; monitoring of nutritional status; nutrition and food hygiene education; household food security. AFF AFF+ ODI 100%

15170: Women's equality organisations and institutions 16020: Employment policy and administrative management Employment policy and planning; labour law; labour unions; institution capacity building and advice; support programmes for unemployed; employment creation and income generation programmes; occupational safety and health; combating child labour. Basic social services are defined to include basic education, basic health, basic nutrition, population/reproductive health and basic drinking water supply and basic sanitation. Special programmes to address the consequences of HIV/AIDS, e.g. social, legal and economic assistance to people living with HIV/AIDS including food security and employment; support to vulnerable groups and children orphaned by HIV/AIDS; human rights of HIV/AIDSaffected people. Finance sector policy, planning and programmes; institution capacity building and advice; financial markets and systems. All formal sector financial intermediaries; credit lines; insurance, leasing, venture

50%

16050: Multisector aid for basic social services

16064: Social mitigation of HIV/AIDS

50%

24010: Financial policy and administrative management

10%

24030: Formal sector financial intermediaries

10%

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper OECD-DAC purpose code Clarification on coverage capital etc. (except when focused on only one sector). 24040: Informal/semi-formal financial intermediaries 25010: Business support services and institutions Microcredit, savings and credit cooperatives etc. Support to trade and business associations, chambers of commerce; legal and regulatory reform aimed at improving business and investment climate; private sector institution capacity building and advice; trade information; public/private sector networking including trade fairs; e-commerce. Where sector cannot be specified: general support to private sector enterprises (in particular, use code 32130 for enterprises in the industrial sector). Agricultural sector policy, planning and programmes; aid to agricultural ministries; institution capacity building and advice; unspecified agriculture. Integrated projects; farm development. Including soil degradation control; soil improvement; drainage of waterlogged areas; soil desalination; agricultural land surveys; land reclamation; erosion control, desertification control. Irrigation, reservoirs, hydraulic structures, groundwater exploitation for agricultural use. Supply of seeds, fertilizers, agricultural machinery/equipment. Including grains (wheat, rice, barley, maize, rye, oats, millet, sorghum); horticulture; vegetables; fruit and berries; other annual and perennial crops. [Use code 32161 for agro-industries.] Including sugar; coffee, cocoa, tea; oil seeds, nuts, kernels; fibre crops; tobacco; rubber. [Use code 32161 for agroindustries.] Animal husbandry; animal feed aid. Including agricultural sector adjustment. 100% 100% AFF AFF+

59
ODI

10% 10%

31110: Agricultural policy and administrative management 31120: Agricultural development 31130: Agricultural land resources

100%

100% 100%

100% 100%

100% 100%

31140: Agricultural water resources 31150: Agricultural inputs 31161: Food crop production

100%

100%

100%

100% 100%

100% 100%

100% 100%

31162: Industrial crops/export crops

100%

100%

100%

31163: Livestock 31164: Agrarian reform

100% 100%

100% 100%

100% 100%

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper OECD-DAC purpose code 31165: Agricultural alternative development Clarification on coverage Projects to reduce illicit drug cultivation through other agricultural marketing and production opportunities. (See code 43050 for non-agricultural alternative development.) Non-formal training in agriculture. AFF 100% AFF+ 100%

60
ODI 100%

31166: Agricultural extension 31181: Agricultural education/training 31182: Agricultural research

100% 100%

100% 100% 100%

100% 100% 100%

Plant breeding, physiology, genetic resources, ecology, taxonomy, disease control, agricultural biotechnology; including livestock research (animal health, breeding and genetics, nutrition, physiology). Marketing policies and organisation; storage and transportation, creation of strategic reserves. Including integrated plant protection, biological plant protection activities, supply and management of agrochemicals, supply of pesticides, plant protection policy and legislation. Financial intermediaries for the agricultural sector including credit schemes; crop insurance.

100%

31191: Agricultural services

100%

100%

100%

31192: Plant and postharvest protection and pest control

100%

100%

100%

31193: Agricultural financial services 31194: Agricultural cooperatives 31195: Livestock/veterinary services 31210: Forestry policy and administrative management

100%

100%

100%

100% Animal health and management, genetic resources, feed resources. Forestry sector policy, planning and programmes; institution capacity building and advice; forest surveys; unspecified forestry and agroforestry activities. Afforestation for industrial and rural consumption; exploitation and utilisation; erosion control, desertification control; integrated forestry projects. Forestry development whose primary purpose is production of fuelwood and charcoal. 100% 100%

100% 100% 100%

100% 100% 100%

31220: Forestry development

100%

100%

100%

31261: Fuelwood/charcoal

100%

100%

100%

31281: Forestry education/training

100%

100%

100%

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper OECD-DAC purpose code 31282: Forestry research Clarification on coverage Including artificial regeneration, genetic improvement, production methods, fertilizer, harvesting. Forestry sector policy, planning and programmes; institution capacity building and advice; forest surveys; unspecified forestry and agroforestry activities. Fishing sector policy, planning and programmes; institution capacity building and advice; ocean and coastal fishing; marine and freshwater fish surveys and prospecting; fishing boats/equipment; unspecified fishing activities. Exploitation and utilisation of fisheries; fish stock protection; aquaculture; integrated fishery projects. AFF 100% AFF+ 100%

61
ODI 100%

31291: Forestry services

100%

100%

100%

31310: Fishing policy and administrative management

100%

100%

100%

31320: Fishery development

100%

100%

100%

31381: Fishery education/training 31382: Fishery research 31391: Fishery services 32161: Agro-industries Pilot fish culture; marine/freshwater biological research. Fishing harbours; fish markets; fishery transport and cold storage. Staple food processing, dairy products, slaughter houses and equipment, meat and fish processing and preserving, oils/fats, sugar refineries, beverages/tobacco, animal feeds production. Wood production, pulp/paper production. Including knitting factories. Trade policy and planning; support to ministries and departments responsible for trade policy; trade-related legislation and regulatory reforms; analysis and implementation of multilateral trade agreements, e.g. technical barriers to trade and sanitary and phytosanitary measures (TBT/SPS); mainstreaming trade in national development strategies (e.g. poverty reduction strategy papers); wholesale/retail trade; unspecified trade and trade promotion activities.

100% 100% 100%

100% 100% 100%

100% 100% 100% 100%

32162: Forest industries 32163: Textiles, leather and substitutes 33110: Trade policy and administrative management

100% 50% 20%

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper OECD-DAC purpose code 33120: Trade facilitation Clarification on coverage Simplification and harmonisation of international import and export procedures (e.g. customs valuation, licensing procedures, transport formalities, payments, insurance); support to customs departments; tariff reforms. Integrated rural development projects; e.g. regional development planning; promotion of decentralized and multisectoral competence for planning, coordination and management; implementation of regional development and measures (including natural reserve management); land management; landuse planning; land settlement and resettlement activities [excluding resettlement of refugees and internally displaced persons (72030)]; functional integration of rural and urban areas; geographical information systems. Projects to reduce illicit drug cultivation through, for example, non-agricultural income opportunities, social and physical infrastructure (see code 31165 for agricultural alternative development). Unearmarked contributions to the government budget; support for the implementation of macroeconomic reforms (structural adjustment programmes, poverty reduction strategies); transfers for the stabilisation of the balance-of-payments (e.g. STABEX, exchange rate guarantee schemes); general programme assistance (when not allocable by sector). Supply of edible human food under national or international programmes including transport costs; cash payments made for food supplies; project food aid and food aid for market sales when benefiting sector not specified; excluding emergency food aid. Shelter, water, sanitation and health 100% 100% AFF AFF+

62
ODI 20%

43040: Rural development

100%

43050: Non-agricultural alternative development

100%

51010: General budget support

10%

52010: Food aid/foodsecurity programmes

100%

71010: Material relief

10%

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper OECD-DAC purpose code assistance and services Clarification on coverage services, supply of medicines and other non-food relief items; assistance to refugees and internally displaced people in developing countries other than for food (72040) or protection (72050). Food aid normally for general free distribution or special supplementary feeding programmes; short-term relief to targeted population groups affected by emergency situations. Excludes nonemergency food security assistance programmes/food aid (52010). In the donor country. 100% AFF AFF+

63
ODI

72040: Emergency food aid

100%

92010: Support to national NGOs 92020: Support to international NGOs 92030: Support to local and regional NGOs

10% 10%

In the recipient country or region.

10%

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

64

Annex 2: Sector profile matrix


Contribution of ARD&FS to Malawi
25

Agriculture is the most important sector of the Malawian economy, employing about 80% of the total workforce (formal and informal), contributing over 80% to foreign-exchange earnings and accounting for 39% of gross domestic product (GDP). Moreover, the sector supplies more than 65% of the manufacturing sect of the total income of the rural people.26 About 85% of the population lives in rural areas, the majority of whom are smallholder farmers who cultivate less than one hectare of land and rely on a single harvest of maize for food. The agricultural sector has two main subsectors: the smallholder subsector, which contributes more than 70% of output, and the estate subsector, which contributes less than 30% to agricultural GDP. Smallholders cultivate mainly food crops while estates focus on high-value cash crops for export such as tobacco, tea, sugar, coffee and macadamia. Figure 12. ARD&FS as a 80 70 60 50 40 30 20 10 0 1990-1994 1995-1999 2000-2005 Share of total GDP Share of total formal employment Share of total earnings xports and workforce (1990 2005).

Between 1990 and 2005, economic growth in general and agricultural growth in particular has been elusive. The growth rates in GDP per capita and agricultural GDP per capita were generally negative during the 1980s and early 1990s, with some improvements in the late 1990s. The high growth rate in agricultural GDP in the 1995 99 period is partly attributed to a reported (but probably overstated) increase in production of root crops such as cassava and sweet potatoes. Since 2006, Malawi has experienced positive agricultural growth, largely due to the successful implementation of the Farm Input Subsidy Programme (FISP) and favourable weather patterns.

25 26

Source: GoM (2010a). Source: World Bank (2007b).

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Table 8. Change in agricultural sector output, 1990 2009 (%). Indicator GDP Agricultural GDP GDP per capita Agricultural GDP per capita 1990 94 0.61 2.15 -2.66 -1.19 1995 99 6.4 15.06 3.17 11.55 2000 05 1.55 2.16 -0.28 0.36 2006 09 7.28 3.63 13.63 4.99

65

Maize plays a predominant role in food security in Malawi as it occupies about 70% of cultivable land in ort cash crop, accounting for 65% of export earnings, followed by tea and sugar. Tobacco production grew significantly in the 1990s when it was liberalised for smallholder production (now 70% of the total), but has declined in recent years due to poor weather and reduced auction prices, both of which have affected economic growth and disposable income. Table 9. Composition of export earnings by main commodity, 1990 2009 (%). Commodity Tobacco Tea Sugar Cotton Other (non-agric) 1990 94 69.9 9.7 6.7 1.1 9.5 1995 99 70.5 9 7 1.7 6.6 2000 05 54.6 8.8 11.4 2.1 19.4 2006 09 65.06 6.27 6.66 2.32 19.7

Source: GoM (2010a).


The trends in export composition also show that the post-reform period is associated with the emergence of new export crops such as coffee, pulses and rice, the re-emergence of the nuts (groundnut, cashew and macadamia) market and the increase in the share of non-agricultural exports.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

66

Figure 13. Growth in agricultural exports (tonnes), 1971 2007. 180000 160000 140000 Exports (tonnes) 120000 100000 80000 60000 40000 20000 0 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 Years

Sugar

Tea

Tobacco

Institutional structure of the ARD&FS sector


Institutional arrangements for implementation of agricultural programmes and delivery of related services involve both state and non-state actors at central and district level. At the central level, emphasis has to date been on the formulation and implementation of sector policies, strategies, projects and programmes and this has largely entailed a top-down approach. However, with the -state institutions at district level, which now have a greatly increased role in planning and implementation of programmes and projects as well as in the delivery of services.

Ministry of Agriculture and Food Security


The technical structure of the Ministry of Agriculture and Food Security (MoAFS) comprises six departments responsible for the following programmatic areas: Agricultural Research Services; Animal Health and Livestock Development; Crop Production; Agricultural Extension Services; and Land Resources Conservation. The ministry is further divided both administratively and technically into eight Agricultural Development Divisions (ADDs), which represent agroecological zones in the Northern Region (Mzuzu, Karonga), the Central Region (Lilongwe, Salima, Kasungu) and the Southern Region (Shire Valley, Blantyre, Machinga). There are research establishments in all ADDs which are responsible for technology generation and assist in technology transfer. Service delivery at village level is decentralised through 28 District Offices, 180 Extension Planning Areas and Sections, which cover over 400 villages. In line with the decentralisation programme, the District Agricultural Development Office reports to the District Commissioner . The sector also includes the following government owned companies (parastatals): the Agricultural Development and Marketing Corporation, National Food Reserve Agency, Smallholder Farmer

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

67

Fertilizer Revolving Fund of Malawi, the Tobacco Control Commission and the Pesticides Control Board.

Other ministries and public institutions


In recognition of the scope of the sector, several other national institutions are considered part of the onal framework, as depicted in the agriculture sector-wide approach (ASWAp) management structure (see Figure 14). The Ministries of Irrigation and Water Development, Trade and Industry, Local Government and Rural Development, and Development Planning and Cooperation, the Office of the President and Cabinet, Department of Nutrition, HIV and AIDS, and Department of Public Procurement are key public actors in the sector.

Non-state actors
The principal non-state actors are the farmers themselves who are the main beneficiaries of agricultural programmes, but they are highly unorganised, with very few cooperatives and associations. As a result, smallholder farmers tend to have no or very little influence on policy developments and project activities that influence their environment. In addition, most of the farmers are illiterate or semi-literate, which results in difficulties in adopting new technologies and their understanding of farming as a business activity. Private firms working in agriculture and agribusiness are also key stakeholders. There have been very few linkages between farmers and private firms that provide various services to the agricultural sector. For instance, contract farming exists only in a few sectors and covers an insignificant proportion of smallholder farmers. Additionally, there are many strong faith communities and groups (as well as schools) that have significant capacity to play a more substantive role in fostering agricultural change in Malawi. These groups and communities often include local leaders who are influential in advising and guiding grassroots development. There are however unclear roles and responsibilities, weak implementation arrangements, and other rigidities amongst these stakeholders, pointing to the need for enhanced coordination mechanisms. There are currently various ongoing institutional reforms within the sector that entail changing roles, especially between central and district-level institutions on one hand and between state and non-state actors on the other. A core function analysis initiative by the MoAFS has been ongoing and aims at defining the roles of state and nonthe course of doing so, it will identify which functions the public sector should retain, which could be subcontracted and which should be privatised.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

68

Figure 14. Management structure of the ASWAp.

Sector Working Group (SWG)

PS Agriculture

Executive Management Committee


PS of the MoAFS, MoIWD, MoLGRD, MoTID, OPC (Nutrition, HIV/AIDS), MOF, MOEPD

ASWAp Secretariat CENTRAL LEVEL

Technical Working Group


Sustainable Nat. Res. Mgt

Technical Working Group


Food security & risk mgmt

Technical Working Group


Commercial Agri& market

MoTID

MoAFS

MoIWD

MoLGRD

District Partnership Forum on Agriculture DISTRICT LEVEL


NGOs, Donors, farmers, private sector, parastatals, Directorates concerned.

District

DEC

Other Directorates

Directorate Trade &Ind

Directorate Planning& Dev

Directorate

Ag, NR, Irrig.

Management

Calls and chairs

Technical support

Convenes

Advise &/ or consultations

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

69

Public expenditures in ARD&FS 27


Detailed reviews of public expenditure in agriculture, irrigation, forestry and fisheries were conducted in 2001 by the Ministry of Finance and Economic Planning and in 2008 by the Regional Strategic Analysis and Knowledge Support System. As the largest sector in Malawi, agriculture has enjoyed a substantial share of the national budget. Trends in the budget allocation to agriculture since 1980 are presented in Figure 15, against the Maputo target of 10%. Although the 1990s were characterised by an erratic allocation to the sector, there was an overall reduction of resources going to the sector, with an all-time low from 2000 to 2005 (see Table 10). Since 2005/06, there has been a significant increase in the prioritisation of the sector according to its budgetary allocation, representing 16% of the total budget between 2006 and 2009. Figure 15. Trends in agricultural sector expenditure, 1980 2009 (%). 20 18 16 14 12 10 8 6 4 2 0

Percentage share of budget

Agriculture share %

AU NEPAD Target

Years

The national budget is divided in two broad categories, i.e. the recurrent budget and the development budget. The recurrent account of the agriculture sector saw a progressive decline from 1990 to 2005, followed by a sharp increase in the 2006 09 period when the budget jumped to US$188.6 million from US$22.2 million. After a similar decline, the development budget started increasing during the 2000 05 period, possibly as a consequence of the depreciation of the Kwacha in 1998 and investments in safety-net programmes, but subsequently tripled during the 2006 09 period. This striking increase in agricultural spending since 2005/06 is largely attributable to FISP, which is currently classified under the recurrent account.

27

Sources: GoM (2001) and Njiwa et al (2008).

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Table 10. Agricultural sector government spending trends, 1990 2009. Indicators Agriculture share in budget (%) Agriculture budget ($m) Recurrent budget ($m) Development budget ($m) Agriculture spending/capita ($) 1990 94 11 41.9 30.6 11.3 4.8 1995 99 9 36.1 26.6 9.5 3.5 2000 05 6 37.5 22.2 15.3 3.2 2006 09 16 233.1 188.6 44.5 16.3

70

From 1999/2000 to 2006/07 the government was responsible for at least 70% of total spending on agriculture, leaving donors with less than 30% largely supporting the development budget.

Table 11. Agricultural budget by subsector, 1999/2000 to 2006/07. 99/00 Development budget (government) Agriculture Forestry Fisheries Total Development budget (donor) Agriculture Forestry Fisheries Total Development budget (total agriculture, forestry, fisheries) Recurrent spending Agriculture Forestry Fisheries Total Total development budget (real) Total recurrent spending (real) Exchange rate (MK:US$1.00) Deflators 482 33 183 697 1,278 1,331 44.1 544.8 568 45 227 840 778 1,228 59.6 711.2 937 50 273 1,259 403 1,469 72.2 891.7 1,679 106 336 2,121 908 2,121 76.7 1,039.8 1,482 62 381 1,924 810 1,762 97.4 1,135.9 4,345 100 441 4,886 1,322 3,976 109.0 1,277.9 15,247 119 557 15,923 1,824 11,230 118.5 1,474.4 15,230 142 526 15,897 3,782 9,815 136.0 1,684.1 479 38 46 563 670 360 100 69 529 532 159 50 114 323 346 687 1 84 772 908 547 101 134 781 885 244 802 175 1,221 1,624 178 2,267 2,587 257 5,062 6,125 2,089 4,805 00/01 01/02 02/03 03/04 04/05 05/06 06/07

95 3 9 107 1 2 3

17 3 2 23

87 49 136

42 41 20 103

328 40 35 403

266 50 4 320

1,010 37 16 1,063

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

71

Agriculture (crops/livestock) accounts for the largest share of total spending for the sector. The crops/livestock function includes administrative and support services; extension and extensionmanagement services; nutrition and food security, including subsidies; land and water management services, including irrigation; and research and technology generation and development. This is a major area of spending on agriculture, with an average of 79% of total spending from 1999/00 to 2006/07 in cash terms and up to an average of 87% in real terms.

Table 12. Annual programme spending, 1999/2000 2006/07. Annual spending 99/00 Administration and support Agricultural extension Nutrition and food security Land and water management Research and technology 756.8 174.9 00/01 678.3 158.5 01/02 477.1 255.1 02/03 922.7 563.4 03/04 671.6 634.3 52.1 31.4 92.5 44.7 46.5 267.7 112.2 721.2 245.4 566.4 146.0 04/05 603.5 797.0 2,877.6 407.1 232.2 05/06 1,125.5 907.8 13,099.0 2,134.5 335.0 06/07 4,971.6 2,239.6 22,841.0 482.1 510.1 71.50 -6.70 Real growth rates 99/00 03/04 -19.20 14.80 03/04 06/07 150.00 46.00 84.00 -5.20 29.10

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

72

Annex 3: Overview of ARD&FS policy framework over last 2 decades


National development policies/strategies ARD&FS policies/strategies Key policy actions28 1987 94 After experiencing a major economic crisis at the end of the 1970s, Malawi embarked on a series of structural adjustment programmes (SAPs), under the auspices of the International Monetary Fund (IMF) and the World Bank. The required structural reforms included the liberalisation of the agricultural sector, price decontrol, parastatal sector reform, privatisation, trade liberalisation, financial-sector reform, exchange-rate liberalisation, interest-rate liberalisation and the rationalisation of the budget. The direct government involvement in agricultural development since independence was called into question and systematically reversed during this period. Second Statement of Development Policies Building upon the National Rural Development Removal of preferential lending to the agricultural (DEVPOL) (1987 96) Programme, but taking into account the structural sector (1990) Government set out a blueprint to revive adjustment measures, DEVPOL spelt out the Liberalisation of agricultural marketing services agricultural growth through investment, downscaling and ultimate removal of farm-input (output 1987, input 1990) extend services to smallholder growers and subsidies, as well as the liberalisation of input and Liberalisation of the prices of some agricultural make the agricultural sector more resilient output markets to allow the private sector a role produce (1988) to external shocks. alongside Creation of the Smallholder Farmer Fertiliser Marketing Corporation (ADMARC). Revolving Fund of Malawi (SFFRFM) in 1988 The government also planned to double access to Removal of fertiliser subsidy (1991) seasonal credit for smallholder farmers through the Administration (SACA) service, later the Malawi Rural Finance Company (MRFC), which built a link between credit service and technical extension.

28

Adapted from Chirwa et al. (2008).

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper National development policies/strategies 1995 2004 ARD&FS policies/strategies

73
Key policy actions28

This period was marked by the advent of multiparty democracy in Malawi. It was also essentially the aftermath of the structural adjustment period, as most major reforms in the economic sectors had been completed by then. The shared realisation of the failures of these reforms eventually led to a renewed focus on poverty alleviation and social safety nets. Poverty Framework for the Poverty Agricultural and Livestock Development Strategy and Removal of restrictions preventing Alleviation Programme (PAP) was Action Plan (ALDSAP 1995) aimed at smallholder farmers from producing and instituted in 1994 as the main strategy for accelerating a broad-based agricultural and rural marketing high-value export crops, in addressing poverty in Malawi. PAP development programme to reduce poverty and food particular burley tobacco (1995) emphasised the need to raise national insecurity among the poor and vulnerable groups Privatisation of state-owned enterprises since productivity through sustainable broad expanding and diversifying agricultural and livestock 1996 based economic growth and sociocultural product exports and raising farm incomes Liberalisation of all crop prices, except maize, development. Some of the notable projects promoting growth and sustainable utilisation of natural and introduction of maize price band (1996), under PAP included: Free Primary resources which was then eliminated in 2000 Education, Malawi Social Action Fund Creation of independent National Food (MASAF) funded Community Projects, Reserve Agency (NFRA) to oversee strategic European Union (EU) Micro-Projects and a grain management (1999) presidential Health Initiative. Malawi Social Action Fund (MASAF) initiated a public works programme (cash-for-work) in Vision 2020 Under , food insecure areas as a safety net the specific strategic areas include: (i) Increasing food crop Agricultural input support programmes for democratically-mature, environmentally production; (ii) developing the livestock subsector; (iii) smallholder farmers sustainable, self-reliant with equal irrigation development; (iv) improving market efficiency; (v) - Starter pack provided free inputs to opportunities for and active participation by improving land utilisation and management; (vi) reducing resource poor farmers from 1998 to 2000 all, having social services, vibrant cultural post-harvest losses; (vii) improving disaster management; - Agricultural Productivity Improvement and religious values and a technologically(viii) promoting off-farm income-generating activities; (ix) Programme provided inputs on credit to driven middle. economic empowerment of vulnerable groups; (x) farmers (1998) Pillars: (i) good governance; (ii) sustainable improving policy analysis. - Targeted Input Programme (2000) provided economic growth and development; (iii) free inputs (fertiliser, cereal and legume vibrant culture; (iv) economic Under seeds) to targeted resource-poor farmers, infrastructure; (v) social sector Environmental Management Pillar , the specific strategic namely elderly, widows/widowers and development; (vi) science and technologyareas include: (i) controlling land degradation; (ii) arresting households supporting orphans

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper National development policies/strategies led development; (vii) fair and equitable distribution of income and wealth; (viii) food and nutrition security; and (ix) sustainable natural resource and environmental management

74

ARD&FS policies/strategies Key policy actions28 deforestation; (iii) controlling and preventing depletion of water resources; (iv) developing fisheries; (v) developing the wildlife sector; (vi) restoring and conserving biodiversity; (vii) developing human settlements; (viii) climate and pollution; (ix) poverty and population; and (x) political advocacy and natural resources.

Malawi Poverty Reduction Strategy (MPRS 2002 05) aimed to provide an

overarching strategy for multi-sector interventions towards the common aim of reducing poverty through socio-economic empowerment. Pillars: (i) sustainable pro-poor growth; (ii) human capital development; (iii) improving the quality of life of the most vulnerable; (iv) good governance. Cross-cutting issues: HIV/AIDS, gender and empowerment; environment; science and technology.

Under the MPRS Sustainable Pro-poor Growth pillar , there are the following ARD&FS-related objectives and strategies: (i) Expand and strengthen access to agricultural inputs; (ii) improved agricultural production through improved agricultural research and extension services; (iii) improved access to domestic, regional and international markets; (iv) promote small-scale irrigation schemes and drainage; (v) encourage production specific crops; (vi) encourage production of livestock; (vii) reduce land shortage and degradation; (ix) promote and expand farmer mechanisation; (x) reduce weaknesses in institutional and policy framework; and (xi) reduce gender disparities, HIV/AIDS infections and effects in the agriculture sector.

Increase agricultural incomes

resources; and (iii) wildlife resources. This period builds on the poverty reduction approach, but represents a shift from social consumption to sustainable economic growth and infrastructure development. There is a pronounced re-prioritisation of agriculture and food security through maize self-sufficiency and government intervention, as well as key role for private sector in economic growth. Malawi Economic Growth Strategy (2004 06) to A New Agricultural Policy (2005): sought to fulfil Farm Input Subsidy Programme (FISP) create an overall macroeconomic environment the mandate of the Ministry of Agriculture and Food introduced since the 2005/06 season as a 2005 10

Encourage the sustainable utilisation of natural resources, namely (i) fisheries resources; (ii) forestry

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

75

National development policies/strategies ARD&FS policies/strategies Key policy actions28 conducive to broad based GDP growth of at least Security, namely to promote and facilitate nation-wide fertiliser and seed subsidy 6% per annum that is sustained over a long term, agricultural productivity so as to ensure food scheme, targeting between 1.6 and 2.8 through stimulation of investment in the five highsecurity, increase incomes and create employment million farmers per year through a vouchergrowth subsectors (agroprocessing; mining; opportunities through the sustainable management based system cotton; textile/garments; tourism) while and utilization of natural resources, adaptive concentrating on certain core subsectors (tobacco, research and effective extension delivery system, sugar, cotton, tea, maize and cassava) coupled with promotion of value-addition and agribusiness and a focus on facilitating domestic and international irrigation development. trade. Immediate objective: ensure that the country has adequate maize within the next two years.

Malawi Growth and Development Strategy (2006 11) is the overarching operational medium-

term strategy for the transformation of the country from being predominantly importing and consuming to a manufacturing and exporting economy.

Agricultural Development Programme (2008 11),


now Agriculture Sector Wide Approach (2010 14) is framework aimed at achieving an annual agricultural growth rate of 6%.

Priorities:

(i) Agriculture and food security; (ii) irrigation and water development; (iii) transport and infrastructure development; (iv) energy generation and supply; (v) integrated rural development; and (vi) prevention and management of nutrition disorders and HIV/AIDS.

Focus areas:

(i) Food security and risk management; (ii) commercial agriculture, agroprocessing and market development; and (iii) sustainable agricultural land and water management

Key support services: Cross-cutting issues:

Themes:

(i) Sustainable economic growth; (ii) social protection; (iii) social development; (iv) infrastructure development; and (v) improving governance.

(i) Technology generation and dissemination; and (ii) Institutional strengthening and capacity building. (i) Gender equality and (ii) HIV prevention and AIDS impact mitigation.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

76

Annex 4: Tables with detailed aid data29


Table 13. Total aid to ARD&FS by sector definition in constant 2000 US$, 1990 2008 (million US$). 1990 DAC AFF const DAC AFF+ const ARD&FS const value 116 126 133 1991 102 110 104 1992 52 216 219 1993 132 164 171 1994 35 48 63 1995 18 57 72 1996 22 59 74 1997 42 52 55 1998 68 105 132 1999 35 70 76 2000 41 68 81 2001 10 50 52 2002 22 66 68 2003 20 63 64 2004 43 104 111 2005 80 158 189 2006 48 106 117 2007 41 85 95 2008 66 120 142 Total 994 1,827 2,018

Table 14. Aid to ARD&FS by area in constant 2000 US$, 1990 2008 (million US$). 1990 Agricultural policy, administration and development (incl. agrarian reform and alternative development) Agricultural extension and training Agricultural marketing, storage and transportation 104 1991 67 1992 27 1993 128 1994 9 1995 9 1996 9 1997 19 1998 45 1999 23 2000 9 2001 8 2002 10 2003 3 2004 24 2005 63 2006 30 2007 6 2008 42 Total 635

Agricultural production, processing and marketing

1 0

10 0

0 7

1 0

15 8

29

This annex is based on data extracted from AidData (http://www.aiddata.org/home/index) in March 2010.

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper 1990 Agricultural production inputs Agricultural research and plant and animal health Banking and financial services Business support services Fishing policy, development, education/training, research and services Food crop production Forestry policy, development, education/training, research and services General budget support Industrial and export commodities Natural resource management (land and water) Support to NGOs 1991 0 8 1 2 2 3 2 1 0 1 1992 4 1993 0 1994 15 8 3 1 1995 5 2 0 1996 4 1997 4 0 0 0 0 1998 2 1 0 0 7 1999 5 2 0 0 1

77
2000 4 1 0 2 0 0 0 0 0 0 0 14 1 2001 2002 2003 0 1 2004 0 0 0 0 1 2005 0 5 0 0 5 2006 1 0 0 1 1 2007 2 2 0 13 0 2008 3 0 0 0 0 Total 50 31 7 20 37

0 3 12 12 1 0 6 1

0 2

2 2

0 7

0 0

4 8

0 1

0 11

0 0

1 0

5 0

0 1

13 67

5 2 3

1 2

10 3

12 1 0

15 0 3

26 0

6 0 0

20

1 0

6 0 7

18 0 4

8 1 12

7 7 1

17 6 12

159 23 82

17

10

0 0 0 0

0 0 0 0 0 0

0 0

0 0

0 0

0 0

0 0

0 0

1 1

Trade policy and facilitation Rural socio-economic development Rural development Food-security programmes 1 2 7

2 159

30 2

1 11

1 38

23 14

2 7

4 30

2 32

1 25

18 22

8 22

10 29

25 36

19 44

2 49

12 26

0 52

162 606

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper 1990 Non-agricultural alternative development Emergency relief and welfare Basic nutrition Emergency food aid Material relief assistance and services (agricultural share) Social mitigation of HIV/AIDS Total 2 7 1 1 2 3 2 1 2 1 1 1 0 0 0 2 0 0 0 0 0 0 0 1991 1992 1993 1994 1995 1996 1997 1998 1999

78
2000 2001 2002 2003 2004 2005 2006 2007 0 2008 Total 0

1 1 0

0 14 1

0 3 1

0 0 0

8 14 4

1 7 0

1 6 0

3 2 0

17 64 16

1 133 104 219 171 63 72 74 55 132 76 81 52 68 64 111 189

2 117

0 95

1 142

4 2018

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Table 15. Aid to ARD&FS by type of flow in constant 2000 US$, 1990 2008 (million US$). 1990 Grant Loan OOF Equity Blank Other Total 133 96 30 0 104 219 171 63 72 74 55 156 125 2 0 4 0 1 0 11 44 0 132 76 81 52 13 7 0 0 34 3 1991 74 1992 63 0 1993 29 17 1994 52 8 1995 68 1996 68 5 1997 44 1998 75 13 1999 63 2000 74 2001 38 13

79

2002 66 2

2003 53 0 0

2004 82

2005 138 7

2006 97

2007 85 7

2008 114 0 0

Total 1,317 75 2 1 624 0 2,018

0 29 0 111 44 189 19 117 3 95 28 0 142

0 68

11 64

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Figure 16. Share of types of flows in total aid to ARD&FS, 1990 2008 (%). 0% 4% Grant 31% BLANK Loan 0%

80

0%

OOF 65%
Equity Other

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

81

Table 16. Main donors to ARD&FS, 1990 2008 (million US$). 1990 1 2 3 4 5 6 7 8 9 10 World Bank (IDA & IFC) European Commission United States United Kingdom African Development Fund Japan Norway IFAD Germany Canada Top 10 donors Grand total 7 0 127 133 0 98 104 18 4 211 219 92 4 1 4 4 14 1 1991 7 7 34 16 20 5 8 1992 147 1 1 18 8 14 0 1993 84 9 7 3 41 10 0 17 0 0 171 171 0 6 59 63 1 0 64 72 2 1 67 74 1 2 53 55 17 0 10 0 1994 1 11 15 9 1995 0 28 9 16 1996 1 41 10 4 0 9 0 1997 1 7 9 1 10 21 1 1998 10 15 11 20 34 12 1 13 5 5 126 132 5 1 73 76 1 12 73 81 1999 0 34 11 7 13 2 1 2000 0 19 18 14 1 4 3 2001 0 18 8 5 0 0 3 13 2 0 50 52 2 0 63 68 1 0 62 64 1 0 109 111 2002 0 16 23 17 0 0 4 2003 0 0 13 27 11 7 2 2004 29 48 10 16 0 4 1 2005 38 55 17 25 0 5 20 7 3 0 172 189 2 0 109 117 2006 0 31 20 16 19 11 9 2007 1 18 26 10 2 6 14 7 1 0 85 95 2 1 120 142 2008 26 16 21 34 0 8 14 Total 436 379 265 264 163 160 81 57 51 33 1,890 2,018

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

82

Figure 17. Aid flows to ARD&FS from Germany, the United Kingdom, the United States and the World Bank, 1990 2008 (million US$). 200 180 160 140

120
100 80 60 40 20 0 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008

World Bank US UK Germany

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

83

Table 17. USAID Malawi commitment and disbursement data, 2001 to 2009 (US$). Agriculture sector and enabling environment 2001 Commitment Disbursement Balance 2002 Commitment Disbursement Balance 2003 Commitment Disbursement Balance 2004 Commitment Disbursement Balance 2005 Commitment Disbursement Balance 2006 Commitment Disbursement Balance 2007 Commitment Disbursement Balance 2008 Commitment Disbursement Balance 2009 Commitment Disbursement Balance 5,379,682 5,379,364 318 4,270,414 4,099,187 171,226 3,359,661 2,050,127 1,309,534 2,884,000 1,408,428 1,475,572 3,144,000 1,901,483 1,242,517 1,697,000 5,543,373 5,538,893 4,480 5,266,032 5,266,032 6,063,358 6,063,356 2 3,691,573 3,675,146 16,427 1,696,823 1,681,799 15,024 1,354,087 1,316,704 37,383 1,435,000 783,629 651,371 1,697,000 6,733,038 6,726,075 6,962 6,189,070 6,189,070

Private sector and trade 1,775,751 1,751,767 23,985 3,659,925 3,659,848 77 972,000 972,000

Environmen t 1,600,000 1,600,000 4,528,000 4,528,000 5,305,260 5,302,519 2,740 2,223,635

Disaster readiness

Total economic growth 10,108,789 10,077,842 30,947 14,376,995 14,376,918 77 11,820,633 11,813,412 7,220 15,157,158

1,604,132 2,112,981 110,654 5,159,526 5,038,055 121,471 5,214,924 1,212,388 4,932,051 282,873 1,709,087 1,691,371 17,716 3,155,000 2,731,504 423,496 3,324,000 2,027,925 1,296,076 80,000 80,000 1,195,061 17,327 398,000 327,921 70,079 11,908,099 486,450 6,820,835 5,386,123 1,434,712 7,474,000 4,923,561 2,550,439 8,245,000 4,009,408 4,235,592 1,517,952 86,181 451,992 451,992 14,960,321 196,837 14,682,773 14,544,557 138,216 12,394,549

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

84

Annex 5: List of key informants interviewed


Name Cybill Sigler Chinkunda Archangel Sarah Hennell Blessings Botha Anne Conroy Neil Orchardson Genschers Chisanga Pinit Korsieporn Alick Nkhoma Rosebell Mbamba Ali Twaibu Aaron Batten Nations Msowoya Mark Miller Tithokoze Samuel Zex Kalipalire Edwin Kanyoma Sarah Tione Uta Borges George Mwepa Organization/ministry/department USAID USAID USAID DFID Irish Aid Irish Aid Joint Food and Nutrition Security Taskforce Joint Food and Nutrition Security Taskforce FAO FAO FAO Debt and Aid Management Division, MoF Debt and Aid Management Division, MoF Debt and Aid Management Division, MoF Budget Division, MoF Budget Division, MoF PSIP Unit, MoDPC Planning Department, MoAFS Planning Department, MoAFS GIZ Department of Irrigation, MoIWD Position/title Team Leader for Economic Growth Budget Specialist, Programme Office M&E Specialist, Programme Office Team Leader for Growth and Resilience Agriculture & Food Security Advisor DCAFS Coordinator Technical Secretariat Technical Secretariat FAO Resident Representative Assistant Representative Food Security Coordinator Assistant Director Economist Assistant Director Economist Economist Economist and Desk officer for Agriculture Principal Economist Economist Country Director Deputy Director

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Name Tamani Nkhono-Mvula Marita Sorheim-Rensvik Francis Sakala Walusungu Kayira Alfred Nyasulu Hardwick Tchale Toshihide Yoshikura Vincent Mkandawire Reinford M. Manda John Phiri S. Mulungu Felix Pensulo Phiri Humphrey A.J. Mdyetseni Enrica Pellacani Vinda H.L. Kisyombe Abdi Edriss Ian Kumwenda John Ngalande Nyuma Mughogho Francis Chilimampunga Ernest Misomali Peter Kulemeka Organization/ministry/department Civil Society Agriculture Network Norwegian Embassy Ministry of Local Government and Rural Development Ministry of Local Government and Rural Development IFAD World Bank JICA JICA JICA M&E Unit, MoDPC M&E Unit, MoDPC OPC, Department of Nutrition, HIV and AIDS OPC, Department of Nutrition, HIV and AIDS Delegation of the European Union African Development Bank Bunda College of Agriculture Agriculture and Natural Resources Management Consortium (ANARMAC) Department of Forestry, MoNREE Department of Forestry, MoNREE Department of Forestry, MoNREE UNDP UNDP

85
Position/title Policy Analyst and Acting National Coordinator First Secretary, Agriculture and Environment Attach Chief Rural Development Officer Economist National Coordinator Senior Agricultural Economist Project Formulation Advisor (Agriculture and Rural Development) Aid Coordinator (Agriculture) Programme Officer Chief Economist Deputy Director for Nutrition, HIV and AIDS Deputy Director of Planning, Research and Evaluation Counsellor Head of Section, Rural Development and Food Security Agricultural Economist Lecturer Senior Consultant (Former Director of Planning at the MoAFS) Deputy Director Assistant Director Assistant Director Assistant Resident Representative for Capacity Development Programme Analyst, M&E

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Name Clement Phangaphanga Christina Zakeyo Chatima Alla J. Chiyembekeza Richard Chiputula Ranil Dissanayake Mwendo Phiri Organization/ministry/department Ministry of Industry and Trade Ministry of Industry and Trade National Assembly Malawi Economic Justice Network Formerly with Debt and Aid Division, MoF World Vision International

86
Position/title Deputy Director of Industry Deputy Director of Trade Member of Parliament (Thyolo South West) and Chair of Parliamentary Committee on Agriculture and Natural Resources Director of Programmes Economist Senior Agricultural Officer

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

87

Annex 6: Format used to report to MoF on ODA (GoM, 2010b)


Please read explanatory notes BEFORE completing this template Donor / Multilateral Partner Name: Currency: All completed projects for which the final disbursement has been made and reported to Ministry of Finance should be removed from the template. Primary Location (List all relevant Districts) Donor Project Code Total Donor Fundin g Project Period Date Agreemen t Signed Date of Project Effectivenes s Date of Original Planned Completion Date of Revised Planned Completio n Date of Actual Completio n Project Status

Aid Category / Project Name

1) Budgetary Support (BOP) General Budget Support Sector Budget Support 2) Pooled Funds 3) Project / Programme specific funding

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Total Grants Total Loans Total Disbursements (1+2+3) 4) Pipeline projects

88

Aid Category / Project Name 1) Budgetary Support (BOP) General Budget Support Sector Budget Support 2) Pooled Funds 3) Project / Programme specific funding Total Grants

Terms of funding (Loan or Grant)

Included in 2009/10 Budget?

Implementi ng Agency

Sector

Name of NonGovernmental Implementing Agency (if applicable)

Are Governmen t PFM Systems Used?

Are Government Procurement Systems Used?

Is the Funding Administered by a PIU?

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Total Loans Total Disbursements (1+2+3) 4) Pipeline projects

89

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper Actual Disbursement s Prior to June 2008 (for active projects)

90
Quarterly Actual disbursements Q1 of 2009/10

Projected disbursements 2009/10 Total Actual Disbursements 2008/09 (for active projects)

Aid Category / Project Name 1) Budgetary Support (BOP) General Budget Support Sector Budget Support 2) Pooled Funds 3) Project / Programme specific funding Total Grants Total Loans Total Disbursements (1+2+3) 4) Pipeline projects

Q1

Q2

Q3

Q4

July

August

Septembe r

Q1

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

91

Actual disbursements Q2 of 2009/10

Actual disbursements Q3 of 2009/10

Actual disbursements Q4 of 2009/10

Projected disbursements 2010/11 Quarterly

Aid Category / Project Name 1) Budgetary Support (BOP) General Budget Support Sector Budget Support 2) Pooled Funds 3) Project / Programme specific funding Total Grants Total Loans Total Disbursements (1+2+3) 4) Pipeline projects

Oct

Nov

Dec

Q2

Jan

Feb

Mar

Q3

April

May

June

Q4

Q1

Q2

Q3

Q4

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

92
Actual disbursements Q3 of 2010/11

Actual disbursements Q1 of 2010/11

Actual disbursements Q2 of 2010/11

Aid Category / Project Name 1) Budgetary Support (BOP) General Budget Support Sector Budget Support 2) Pooled Funds 3) Project / Programme specific funding Total Grants Total Loans Total Disbursements (1+2+3) 4) Pipeline projects

Jul

Aug

Se p

Q1

Oct

Nov

Dec

Q2

Jan

Feb

March

Q3

Total Disbursed from Inception to Date

Projected Expenditu re 2010/11

Projected Expenditur e 2011/12

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

93

Annex 7: Templates used to register or update a project in the PSIP database30

30

GoM (2010c).

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

94

Template to register project

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

95

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

96

Template for finance and status update

Platform Knowledge Piece 2: Aid to agriculture, rural development and food security: Malawi working paper

97

Annex 8: Reporting format used to report to MoAFS database


FIELDS IN THE DATABASE ** Sector Code Project Title Donor/Lender Partner Total Cost Currency used (Euro, Pound Sterling, Canadian Dollar, US Dollar, Australian Dollar, Malawi Kwacha, Swedish Krona) Total disbursement to date Approval Date Project funding type (Loan/ Grant/Co-funding) www address for Implementing Agency Name of Implementing Agency Telephone for Implementing Agency Fax for the Implementing Agency Project Email Project Address District and Traditional Authority Coverage (e.g. Lilongwe, TA Chadza; Nsanje, TA Malemia) Targeted Beneficiaries (Households e.g. male headed, female headed & child headed households) Targeted individuals (e.g. no of male, no of females, no of children) Targeted Group (e.g. Rural Farmers, Smallholder farmers, Women, Orphans etc) Components Objectives Planned Project Outputs Indicators Start Date Completion Date

Prepared by: Platform Secretariat Published by: Global Donor Platform for Rural Development c/o Federal Ministry for Economic Cooperation and Development (BMZ) Dahlmannstrae 4, 53113 Bonn, Germany Study conducted by: Overseas Development Institute, London Authors: Michelle Remme Photo credits: www.istock.com/Gnter Guni/skyhouse; www.fotolia.com/africa/Ivan Gulei/lul; www,pixelio.de/hjrdis Kozel/Rauner Sturm August 2011