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Economic Brief - Towards Sustaining Malawi's Farm Input Subsidy Program


As a land-locked country, Malawi is under pressure to grow its own food, since imports are both costly and unreliable. Maize is the main staple for 90 per cent of the population, and most smallholders operate on tiny plots of land1, making diversification difficult. Largely these constraints explain the long-standing and often contentious policy of subsidizing inputs in Malawi. Thus, from the mid-1970s to the early 1990s, the government financed a universal fertilizer subsidy program, provided cheap credit to the smallholder, and controlled maize prices. This system began to break down in the late 1980s/early 1990s and collapsed in the mid-1990s. However, with the widespread

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