MALAWI: GLOBAL HUNGER AND FOOD SECURITY INITIATIVE

UNCLAS SECTION 01 OF 03 LILONGWE 000021

SIPDIS

NAIROBI FOR FAS HAMMOND

E.O. 12958: N/A
TAGS: EAID EAGR ECON ETRD PGOV MI
SUBJECT: MALAWI: GLOBAL HUNGER AND FOOD SECURITY INITIATIVE
DIPLOMATIC STRATEGY

REF: SECSTATE 124059

Summary
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1. Summary: One of the poorest countries in the world and highly
vulnerable to food shortages, Malawi is an appropriate target for
the Global Hunger and Food Security Initiative. The Mission plan is
based on three pillars (assistance, direct diplomacy, and public
diplomacy),and will engage all USG agencies active in Malawi along
with other development partners. While USAID-administered
assistance programs will constitute the bulk of Mission activities,
we will complement those assistance efforts with private diplomatic
efforts to emphasize policy reform messages and public diplomacy to
convey broader messages and influence opinion. End summary.

The Malawi Context
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2. With a per-capita income of USD 836 (IMF),Malawi ranks as one of
the world's dozen poorest countries. Already the sixth most densely
populated country on the African continent, Malawi's birth rate of
over 40 per 1000 (16th globally) places continuing pressure on its
ability to feed itself. The Government of President Bingu wa
Mutharika has made food security its highest priority since taking
office in 2004, a year when drought left over 4.5 million Malawians
in need of food aid. Even after four consecutive years of crop
surpluses, the country's food security situation remains fragile.
Malawi's economy is still overwhelmingly dependent on rain-fed
agriculture, leaving it vulnerable to drought or other weather
shocks. With little industry, Malawi cannot buy its way out of
crisis, since its ability to generate income depends heavily on cash
crops (tobacco, tea, cotton, coffee) subject to the same weather
shocks as its food crops.


3. The GOM is investing 13% of its 2009/2010 national budget to
address agriculture and food security related issues, compared to
the Comprehensive Africa Agriculture Development Program (CAADP)
target of 10%. The GOM's Agriculture Development Program (ADP) lays
the foundation for a harmonized and country-owned strategy, linked
to the CAADP and Global Hunger and Food Security Initiative (GHFSI)
objectives. ADP is an agreement between the GOM and donors on a
harmonized agriculture strategy and investment plan. The ADP,
however, languished for several months in 2009 without action, and
has only recently been accepted by Cabinet, with some
qualifications. President Mutharika recently announced the launch
of the "Greenbelt Initiative" (GBI) promoting irrigation and better
soil management as part of his push to improve agricultural
productivity.


4. President Mutharika's signature agricultural input subsidy
program (AISP) has been widely praised as having contributed to a
dramatic improvement in food security. The high cost of the program
makes its long-term sustainability doubtful for a country dependent
on donor assistance for 30 to 40 percent of its annual budget. Less
than transparent application of the AISP and restrictions on private
sector participation in the program hinder private sector growth and
limit the overall impact of investments in the agricultural sector.


5. GOM interventions in agricultural markets go beyond the AISP to
include establishment of minimum prices for Malawi's major cash
crops - tobacco and cotton. During the past year, the Government
expelled four executives of international tobacco firms for failing
to pay the mandated prices. Just a few months later, Malawi's
largest cotton buyer, Cargill, pulled out of the country altogether
after determining that it could not justify paying the GOM-set
cotton price.

Major Objective
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6. Addressing policies that constrain or disrupt market activities
and inhibit sustainable investment in the agricultural sector will
be a major objective for the GHFSI in Malawi. In particular, a key
goal will be to increase private sector investment in agriculture
and unlock the increased tax revenue, foreign exchange, and growth
that participation generates.

GHFSI Assistance Programming
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7. One pillar of the GHFSI effort in Malawi will be
USAID-administered development assistance activities. These
investments are described in detail in USAID's Global Hunger and
Food Security Implementation Plan. Having worked closely with the
GOM on the development of its ADP, USAID has designed its GHFSI
implementation plan to support the principles of that country-led

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program. The GHFSI plan will focus on six core areas.

a. Increased Agricultural Productivity: GHFSI projects will
promote increased access to irrigation, credit, technology and
markets by agricultural producers, strengthen organization and
capacity of producer associations, and support bulking and market
linkages at local, national and regional levels to increase
productivity at all levels of the agricultural value chain.

b. Increased Trade and Reduced Barriers to Market Access: GHFSI
programs will help producers associations to access national and
intra-regional agricultural markets, stimulating growth in both
export and import-substituting production.

c. Sound Market-Based Principles for Agriculture: GHFSI programs,
through support and advocacy with the GOM and civil society, will
promote evidence-based agricultural policies to reduce risk and
improve the ability of farmers and the private sector to efficiently
plan production.

d. Accelerate Participation of the Ultra Poor in Rural Growth:
GHFSI projects are designed to graduate 'vulnerable yet viable'
households into sustainable producers in mainstream commodity
markets.

e. Reduce Under-Nutrition: GHFSI programs will improve the
nutritional status of households with special attention to pregnant
and lactating women and children under five, increasing the overall
health and productive capacity of the population.

f. Increase the Impact of Humanitarian Assistance: GHFSI programs
will support vulnerability monitoring and assessment, as well as
policy-making capacity to increase the impact of humanitarian
assistance and improve the GOM capacity to utilize a sophisticated
range of mechanisms against famine.



8. USDA Title II Food for Progress and Dole-McGovern funded programs
supporting school-feeding, agriculture associations, and
microfinance programs will be integrated to leverage these broad
GHFSI focus areas. Additionally, Peace Corps programs in Malawi
include a substantial environmental element; the Mission GHFSI team
will coordinate to identify and implement potential synergies with
these volunteers.

Direct Diplomatic Engagement
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9. To improve a broad policy environment that sometimes constrains
or disrupts market activities and inhibits sustainable investment in
the agricultural sector, direct diplomatic engagement will be key.
The Ambassador, USAID Director, and other senior Mission officers
regularly discuss these issues with their Malawian counterparts and
donor colleagues. We will expand that effort in a systematic way by
engaging key GOM officials and civil society and private sector
leaders with GHFSI messages.


10. The Ambassador and senior Embassy officers will promote GHFSI
principles and objectives through their participation in the monthly
heads of mission meetings of donor country representatives. These
meetings address higher level policy issues, as well as technical
issues not resolved at lower levels.


11. USAID will incorporate the GHFSI agenda into its participation
in the heads of co-operating partners' forum, newly formed to
discuss donor coordination, harmonization, development assistance
strategy and relevant technical issues. This forum will provide the
Mission another opportunity to work toward achieving a common donor
position on needed agricultural policy reforms.


12. In line with the Paris and Accra principles on the coordination
and harmonization of assistance with country-led plans, and the
Malawi Development Assistance Strategy (DAS),the GOM is in the
process of establishing an Agricultural Sector Working Group
(AgSWG). The AgSWG will be co-chaired by the Permanent Secretary of
Agriculture and a rotating representative from the donor community,
and will constitute the principle mechanism for coordinating efforts
to implement Malawi's ADP. Experience implementing the MCC
Threshold Program demonstrated the utility of a task force approach
in engaging the GOM, the USG and the broader donor community. The
Mission will use its participation in the AgSWG to advance GHFSI
objectives and ensure that USG efforts are in line with the overall
agricultural development agenda in Malawi. Although the GOM and the
donor community, through its experience with the health sector, have
some familiarity with sector working groups, the new AgSWG is still
at the embryonic stage. The Mission anticipates that considerable
effort and resources, including technical assistance and capacity

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building, will be needed to make it a fully effective.


13. Also at the working level, USAID plays a central role in Donor
Committee for Agriculture and Food Security (DCAFS),which holds
monthly meetings to discuss coordination of donor efforts, and a
second meeting each month with the GOM Permanent Secretary for
Agriculture. Despite uneven donor commitment to press for
agricultural reform, and limited institutional strength, DCAFS still
represents the best available venue for promoting the GHFSI agenda
to all of the stakeholders in Malawi's agricultural sector.

Public Diplomacy Activities
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14. As the third pillar of the Mission-wide GHFSI diplomatic
strategy, we will design and implement public diplomacy and outreach
efforts to inform the public regarding GHFSI activities. Our
programs will seek to inspire public interest in encouraging
Malawian leaders to address the necessary policy issues that
constrain agricultural development.


15. Our public diplomacy tools will include direct outreach
initiatives such as Ambassadorial op-ed placements, press releases
highlighting particular assistance activities, press interviews, and
programs with targeted audiences using visiting experts or digital
video conferences. We will also use less direct public outreach
tools such as International Visitor Leadership Programs and academic
training opportunities for key up-and-coming officials and civil
society leaders.

Mission Coordination
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16. The Mission will establish an overarching Food Security
Oversight and Coordinating Committee, chaired by the Deputy Chief of
Mission, to coordinate Mission-wide GHFSI activities. USAID will
take the lead in coordinating GHFSI assistance activities, with
collaboration and support from the Embassy. USAID will designate a
GHFSI Country Coordinator to be responsible for the coordination of
GHFSI assistance activities in country. The GHFSI Country
Coordinator will lead monthly meetings with representatives from all
USG agencies involved to ensure that information is shared and
efforts are coordinated across agencies. The Country Coordinator
will produce a monthly activity report and provide regular briefings
to the Food Security Oversight and Coordinating Committee.

Comment
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17. Notwithstanding a sometimes challenging policy environment,
Malawi is ideally suited to benefit from GHFSI. Given Malawi's
historic vulnerability to food shortages, nutrition challenges,
fertile soil, abundant water, and a close cultural connection to the
productivity of the land, the stage is set for Malawi to benefit
significantly from this U.S.-led food security initiative.


18. The U.S. Mission in Malawi enjoys good working relationships and
cooperation between all USG agencies resident in country and across
all sectors of our engagement. The Mission's Health team, for
example, with contributions from State, USAID, CDC and the
Department of Defense, has been recognized as a model of interagency
cooperation and effectiveness. With similar Mission-wide
coordination and a strategy that includes 1) a carefully designed
assistance implementation plan, 2) regular diplomatic engagement at
all levels of government and civil society, and 3) consistent public
outreach with GHFSI messaging, a U.S.-led food security initiative
in Malawi will make real progress.

BODDE