Today, the U.S. government, through the U.S. Agency for International Development (USAID), announced $35 million, subject to appropriations, in additional support for Malawi’s economic recovery. This five-year project will focus on empowering women and youth, expanding agricultural commercialization, increasing household and community resilience, and addressing the impacts from a changing climate. The new project will generate jobs and incomes for smallholder farmers and increase agricultural and food exports for the country, and is designed to complement the Millennium Challenge Corporation’s efforts in Malawi to reduce poverty through economic growth. USAID expects to award the new activity in the coming months as part of its support for Malawi 2063, Malawi’s vision to become a self-reliant, upper-middle income country over the next four decades.
The goal of the new initiative is to promote a more inclusive, gender equitable, diversified, and resilient private sector that drives sustainable wealth creation that includes Malawi’s diverse and under-resourced communities. The initiative will strengthen rural economic hubs around value chains or companies that act as anchors for an ecosystem of actors, from smallholder farmers, to service providers and value-added processing. Malawi’s economy is largely dependent on agriculture, with 80 percent of Malawians working in the sector, but productivity is constrained by declining farm sizes and degraded soils and watersheds. Most farming households in Malawi are extremely vulnerable to climatic shocks due to this severe environmental degradation combined with the ongoing impacts of climate change. Malawi’s agricultural industry is not sufficiently commercialized nor large enough to meet the needs of a growing population, which is projected to double to nearly 34 million people in just over two decades.