Name: Feasibility study for the Expansion of Irrigated Sugar Cane under Dwangwa Cane Growers Trust Nkhotakota, Malawi
Year: 2008
Client: EC
Country: Malawi
Background: Although Malawi is considered a world class producer of sugar, having low cost production, excellent cane growing conditions and abundant water and land resources, the sector has a number of challenges which need to be overcome if the sector is to realise its full potential. The Malawi Growth and Development Strategy (MGDS) highlights sugar as one of three core sub sectors in terms of revenue, GDP, employment and foreign exchange earnings and looks to maximize the performance of the sugar sector in the short to medium term. The MGDS recognizes sugar’s importance not only in terms of agricultural production, but also in agro processing, and identifies sugar as a means of reducing Malawi’s dependency on tobacco, which represented approximately 58.2 % of Malawi’s exports in 2002 compared to 7.7 % for sugar.

The Malawi agricultural sector was characterized by a few commercial estates and a large small holder sector which engaged in subsistence and cash crop production. The MGDS perceives low productivity to be a result of reliance on rain fed agriculture, a lack of skilled personnel and an ineffective extensions service. In turn, low productivity was compounded by poor or missing markets.  In response, the MGDS looks to increase the availability of inputs and extension to the small holders in order to increase productivity and create linkages between smallholders and large export oriented processors.

Following a decision to align the production and marketing of sugar with the rules of the multilateral trading system of the WTO, the EC in June 2005 announced substantial reforms to the sugar regime of the Common Agricultural Policy. The reforms currently underway have considerable impacts on sugar producing countries, particularly the ACP members of the Sugar Protocol, which includes Malawi. The reforms, including the phasing out of subsidies and the accelerated elimination of quotas and import tariffs for Least Developed Countries, will bring about challenges and opportunities.

Objectives: The specific objectives of this technical assistance were to:

  • To investigate whether the proposal for expansion of the Dwangwa Irrigated Sugar cane scheme would be financially and economically viable.
  • To verify that identified areas are feasible for irrigated sugar cane production.
  • To sensitise land occupants within the identified areas as to what is planned and to secure their commitment to the implementation of the planned projects in line with the proposed institutional structures.
  • Identify optimum forms of supplementary irrigation for smallholder sugar cane production in the Nkhotakota region.
  • To investigate the socio-economic and environmental impact of the proposed expansion on the beneficiaries as well as the surrounding communities and resources, with specific reference to food and livelihood security.
  • To review whether the current institutional arrangements (DCGT) are suitable, and can be duplicated or extended for the proposed expansion.
  • To develop technical designs for the proposed infrastructure, using the appropriate irrigation technologies (centralised furrow, centre pivot irrigation system or rainfed with supplementary irrigation).
  • To prepare the project for funding and implementation (i.e. assist with the preparation of the final grant contract to be signed between the DCGT and the EC).
Activities: Activities conducted included: key informant interviews with donors government, sugar processing companies, and traditional leaders; community consultation meetings; documentary reviews; observations at irrigation schemes and report writing.
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