Malawi to spend $20 mln on maize imports after poor harvest expected

By Mabvuto Banda

LILONGWE, April 1 (Reuters) – Malawi will set aside $20 million for imports of its staple maize in 2015 because floods and drought were expected to cause a substantial decrease in this year’s harvest, ministers said on Wednesday.

Torrential rains have forced Malawi, which had a bumper crop of 3.9 million tonnes in 2014 and a surplus of over a million tonnes, to declare half of the country a disaster zone.

“We are setting aside about $20 million to import maize because if we don’t do that millions of our people will suffer … this is being set aside in our 2015/16 budget,” Finance Minister Goodall Gondwe told Reuters.

Agriculture Minister Allan Chiyembekeza said his department was still assessing the damage and would release a crop estimate soon.

“The country will experience a substantial decrease of the harvest because of the recent floods that washed away thousands of crop fields and some dry spells experienced in some parts of the country,” he told Reuters in a separate interview.

If Malawi records a deficit and needs to import, it could turn to neighbouring Zambia, which expects a record harvest and plans to export 800,000 tonnes of white maize.

Regional breadbasket South Africa, by contrast, expects to harvest 9.7 million tonnes of white and yellow maize, more than 30 percent less than in 2014 and the smallest harvest since 2007.

Floods earlier this year in Malawi killed more than 100 people and left 173 missing. The United Nations Children’s Fund (UNICEF) said in February that more than 300,000 people had been displaced.

The poor harvest could also put upward pressure on inflation in Malawi, which is currently running at almost 20 percent, the fastest rate in the southern African region.

President Peter Mutharika said in late January that Malawi’s economy, which relies heavily on agriculture, would likely miss a 5.8 percent growth forecast for 2015 because of the floods and crop damage. (Writing by Ed Stoddard; Editing by Jon Boyle)