Malawi and AfDB Group Sign US$ 22 Million Grant Agreement to Boost Small Holder Crop Production

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Tunis, 10 November 2006 – Malawi and the African Development Bank (AfDB) Group signed on Thursday in Tunis, agreement for a grant of 15 million Units of Account (UA*), equivalent to USD 22.2 million, to finance a Small Holder Crop Production and Marketing Project in the country.

The Bank Group’s Vice President for Sector Operations, Mrs. Zeinab El Bakri, co-signed the agreement with the Malawian Ambassador to Egypt, Mr.  M’Madi Yahaya.

Commenting on the project which will be financed with the grant from the African Development Fund (ADF), Mrs. El-Bakri emphasized the importance the Bank Group attaches to portfolio quality improvement and the timely fulfillment of the grant conditions.

"As the Bank undertakes to support  this operation, we look forward to working closely with the Government to ensure its timely implementation and also build synergies with other Bank activities in the sector in order to alleviate poverty and increase the income of the population of Malawi," she noted. 

For his part, Ambassador Yahaya commended the Bank Group for its relentless efforts in supporting Malawi’s development programmes. "We do not take this gesture for granted. The Government of the Republic of Malawi would therefore like to assure you that it will continue to follow the laid down procedures in implementing Bank-funded projects," he added.

The project comprises the development of irrigations and the mitigation of environmental impact as well as support to farmers in crop production, management and marketing.

It will cover 19 of Malawi’s 28 districts, namely, Balaka, Chikwawa, Chitipa, Dedza, Dowa, Karonga, Kasungu, Lilongwe, Machinga, Mangochi, Mchinji, Mzimba, Nkhatabay, Nkhotakota, Nsanje, Ntcheu, Ntchisi, Rumphi and Zomba.

It will also contribute to poverty reduction and food security in rural Malawi by increasing productivity and income of rural households. This will be achieved through the intensification and diversification of the existing cropping system and improvement of the marketing system which will significantly increase production, productivity and incomes of small farmers while improving household nutrition and environmental management of natural resources at the same time.

The estimated number of beneficiary households is 8756, or a total of 45,531 people of which  4,000 are households headed by women. About 76% of Malawi’s rural population will benefit, directly or indirectly, from the market improvement activities.

The ADB Group operations in Malawi started in 1969.  The current intervention brings the Bank Group’s commitment in the country to UA 525 million in 83 operations.

* 1 UA  = 1.48004 USD = 3146.31 MGA as at 10/11/2006


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