World Bank Provides US$12 Million in Additional Funding for Irrigation in Malawi

September 24, 2010

LILONGWE, September 24, 2010— The World Bank has granted Malawi an additional US$12.7 million to help improve agricultural productivity and incomes in rural areas through the development of small-scale irrigation under the Irrigation Rural Livelihoods and Agricultural Development Project (IRLADP).

The financing is additional to US$40 million that the Bank provided Malawi in 2005 for the project. In addition to improving small-scale irrigation, the financing will cover cost overruns for the rehabilitation of some main irrigation schemes such as Limphasa in Nkhata Bay and Likangala in Zomba[1]. It will also be used to scale-up the provision of the technical, managerial capacity, and market access support required for sustainable small-scale irrigation development in Malawi.

“The Bank is keen to help Malawi consolidate the achievements it is making in food security. Developing irrigation systems especially at small scale level will help ensure food sufficiency at household level,” said Sandra Bloemenkamp, World Bank Country Manager for Malawi.

Since the project started, there have been a number of achievements. Over 1500 mini-scale schemes have been rehabilitated or established, benefiting over 100,000 farm households. In schemes now functioning under the project, maize yields have improved by 30 percent, also complemented by improved seed provided through the project’s input for assets program. Agricultural incomes have also improved by almost 40 percent.

“We thought it is important to provide this additional financing to allow the Government of Malawi to fully complete the rehabilitation of the country’s four large irrigation schemes. This will enable irrigation of 2000 hectares benefitting over 20,000 farming households in Nkhata Bay, Zomba, Chikhwawa and Nsanje,” said Ms. Bloemenkamp

The project has however faced some challenges, key of which is the cost overrun by over US$5million for irrigation scheme rehabilitation and development. This was partly due to the effects of the high world market prices witnessed in 2008 which resulted in cost escalations for some materials required in the civil works. The project’s Inputs for Assets Voucher Program has also experienced cost escalations deriving from the sharp increase in the price of fertilizer and other inputs in 2008/09 season.

The IRLADP is expected to close in June 2012. Overall, the project is helping the country address major challenges facing smallholder agriculture in Malawi. These include low productivity and profitability mainly as a result of very low and stagnant yields; over-dependence on rain-fed farming systems given the low level of irrigation development and poor water management; and  inadequate markets and post-harvest assets which lead to depressed incentives to produce for the market, keeping most farmers trapped in low-level subsistence production.

The World Bank has provided the additional financing through the Crisis Response Window which was established to help countries manage the impact of the global financial and economic crisis.

[1]The other main irrigation schemes are Muona in Nsanje and Nkhate in Chikhwawa.

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