Agricultural Policy,Employment Opportunities and Social Mobility in Rural Malawi

Introduction

Although agriculture is the main driver of the Malawian economy, the dynamic relationship between youth employment and agricultural development has not been adequately examined in academic and public policy debates on the country’s agrarian transition. It is imperative to understand this relationship, given that agriculture is described as the engine of Malawi’s economic growth, while the country is experiencing a youth bulge (Chinsinga & Chasukwa, 2012; Government of Malawi, 2008).

Agriculture is a principal source of livelihood in Malawi. Around 84 per cent of Malawians earn their livelihood directly from agriculture, which also accounts for over 90 per cent of the country’s export earnings, about 39 per cent of the country’s GDP and 85 per cent of total employment (Chinsinga, 2008; Kamchacha, 2012). The dominance of the agricultural sector in the country’s economy has been reinforced by the progressive decline of the contribution of the manufacturing sector to GDP, from 16 to 11 per cent, from the early 1990s to date. According to Chinsinga (2008), agro-processing constitutes 26 per cent of manufacturing, less than three per cent of GDP, which suggests that the various aspects of the agricultural value chain remain underdeveloped.

Malawi is experiencing a youth bulge, with a disproportionately youthful population. A country experiences a youth bulge when the 15–24 age cohort dominates the demographic structure of a country relative to the adult population (Urdal, 2006). According to Kamchacha (2012), 60 per cent of Malawians are under the age of 20, 48 per cent under the age of 18 and 40 per cent between 10 and 12 years. Overall, 85 per cent of Malawians live in rural areas and only 15 per cent in urban areas. This means that Malawi is predominantly an agrarian society in which the agricultural sector is critically important to its very existence as a viable nation. Employment opportunities in the formal sector are greatly limited (Government of Malawi [GoM], 2008). The formal sector is expected to employ 130,000 workers per year in both skilled and unskilled categories, but only manages 30,000. The alternative for job seekers is either to look for jobs in the informal sector or engage in agriculture as a means of self-employment. High levels of unemployment in rural areas reflect the declining role of the manufacturing and services sectors in providing formal labour-intensive employment (Kamchacha, 2012).

The 2012 Integrated Household Survey (IHS) shows that poverty in Malawi is deep, widespread and severe. In fact, there has been negligible decline in the incidence of headcount poverty from 52.2 to 50 per cent in 2005–2011. During this period, the proportion of the ultra-poor rose from 22.2 per cent to 25 per cent. These are Malawians who cannot afford the minimum standard for daily recommended nutritional requirements. The IHS further shows that the incidence of poverty in Malawi is predominantly rural. It is estimated that about 56 per cent of rural residents are poor compared to only 17 per cent of those in urban areas. This suggests that the majority of the youth are among the most affected by poverty in rural areas, given the country’s contemporary demographic structure. The poverty of rural youth is further worsened by high unemployment levels among the youth. While the national unemployment rate is estimated at nine per cent, the youth unemployment is pegged at 15.3 per cent. It could actually be worse than this, given the rather minimalist definition of employment used. A person is considered employed if he or she ‘worked for at least one hour during the 7-day period before the date of the interview’ (GoM, 2012).

This article, based on extensive review of literature, policy documents and limited field work, explores the underlying dynamics of the relationship between agricultural policy, employment opportunities and social mobility of rural youth in Malawi. In this article, social mobility means ‘the movement between different social groups, and the advantages and disadvantages that go with this in terms of income, security of employment and opportunities for advancements among others’ (Aldridge, 2001, p. 1). Social mobility has implications on social cohesion, social inclusion, economic efficiency and equality of opportunities. Particular attention is paid to open stratification systems of social mobility whereby achieved status characteristics are assigned some value and there is competition for means of upward social mobility. The field work was carried out in Ntcheu and Zomba districts in central and southern Malawi, respectively, and at the national level. The data at the district level were collected through focus group discussions (FGDs) with youth clubs registered with the district youth officers. The data at the national level were collected through key informant interviews with officials from the Ministry of Youth and Sports, National Youth Council and the Civil Society on Agriculture Network (CISANET). Similar interviews were done at the district level with district youth officers, Youth Enterprise Development Fund (YEDF) officials, and Youth Net Counseling (YONECO) officials.

The following section explores the youth’s perceptions of agriculture, aspirations for their future and ideas of social mobility, triangulated against the perception of other stakeholders. This section also examines the dominance of negative perspectives about agriculture, especially how family farming is considered to be an uneconomic business, largely meant for the poorer and older population. The third section discusses how the government has attempted to address the issue of youth unemployment through policy interventions. The fourth section reviews the YEDF as the major current programme geared towards addressing youth unemployment, although it is not specifically orientated towards the agricultural sector. The fifth section critically interrogates the YEDF’s underlying theory of change as related to youth unemployment. The final section offers some concluding remarks.

Youth Perceptions, Aspirations and Social Mobility

Although youth in Malawi may broadly share similar aspirations—the majority of youth in urban areas ‘dream of successfully finishing school, getting a good job and raising a happy family’ ¹ —there are differences within this social category rendering it heterogeneous. Youth differ, inter alia, on the basis of gender, age, class, place of residence and religion (Anyidoho et al., 2012; Lentilo, 2012).

Youth in rural areas may have generally similar aspirations ‘but are constrained by lack of school fees, especially beyond primary education which is free’. ² The main alternative for rural youth is agriculture, although almost always not by choice but forced by circumstances. In an FGD in Ntcheu, the youth observed that ‘most of us have no option but to venture into agriculture as soon as it is clear that we cannot proceed further with our education’. ³ These sentiments emphasize the structural conditions which make access to resources, especially land, critical to livelihoods among rural and urban peoples, or more generally social reproduction in Malawi, as in other peripheral countries.

In urban and rural areas, the immediate option for out-of-school youth is not agriculture but business. As stated in an FGD, ‘we are forced to resort to agriculture, as we often do not get support from either our families or outside institutions to get started in business’. ⁴ As the poverty statistics indicate, most youths come from poor families that are unable to offer ‘any support apart from offering us land, although after struggles too’. ⁵ The youth will have to convince their family to be allocated their own piece of land, which is not easy amidst land pressure. Malawi’s average land holding size per household is 1.2 ha and the average land per capita is 0.33, reflecting wide land inequality (FAO, 2016; Oxfam, 2015). ⁶ In an event that the family agrees to allocate land to the youthful member of the family, the transaction will have to be approved by the chief who may have a different opinion. The chief may eventually turn down the decision taken by the family. It is also not easy for most youth to access financial capital, because ‘we are required to put up collateral which we not do have’. ⁷ This challenge appears to be universal across the African continent. Valle (2012) argues that while access to finance is a critical factor in developing self-employment opportunities for youth, the majority of microfinance institutions does not serve them. The latter have not been developed to serve the needs of youth, since they require loan guarantee options, such as formal land titles, steady employment, solidarity groups and personal guarantees. In a cross-country review, White (2012) observes that it is not easy for youth to access land, even though they might be interested in agriculture. His argument is that the majority of young people ‘are confronted by the narrowing and sometimes complete closure to access land’ (White, 2012, p. 50).

Youth in both rural and urban areas equally look at business as a more viable alternative for social mobility, once one hits a snag with education. It is, however, important to note that most youth do not think of business in the conventional way, because, as stated earlier, it is not easy for many to access start-up capital either from financial institutions, or from their social support networks. Focus group discussions in both Ntcheu and Zomba districts revealed that youth talk about kuthamanga thamanga patawuni (which literally means ‘running around town’). Upon further inquiry, kuthamanga thamanga means making deals that give quick returns or engaging in some casual labour which enables them to earn a living. While it is an option for both urban and rural areas, it is quite viable in urban areas where opportunities for ‘running around’ are readily available on a highly informalized basis covering both agricultural and non-agricultural activities. These income opportunities are often low wage, have little job security and also insufficient social protection (Dalla, 2012; USAID, 2012; White, 2012). The common income opportunities in which the youth engaged in urban areas include small-scale businesses, domestic work and shop stewardship.

Youth’s preoccupation with ‘running around town’ has greatly contributed to their negative perception of agriculture as an occupation of choice. In fact, agriculture does not feature at all in the youth’s conception of business as ‘running around town’. They argued that ‘agriculture cannot qualify “the running around” conception of business because it is a difficult task; it does not generate profitable returns there and then’. ⁸ Youth generally view agriculture as old-fashioned, an occupation of the poor and an inconsequential enterprise. In an FGD with a youth club in Ntcheu District, agriculture was characterized as ‘an enterprise without a future … if it had a future the lives of our parents would have changed but they not yet, they have been farming since we were young’. ⁹ This just shows that the various segments of the value chain in the agricultural sector are not well developed. The point is that activities such as ‘input supply, processing, storage and marketing and distribution could provide smart employment with status equal to white collar employment’ (Kamchacha, 2012, p. 5). For being an inconsequential enterprise, agriculture has been equated to punishment that is melted on mischievous kids at school. The youth argued that this was the case because ‘farmers work hard year in and year out, but they essentially remain poor people’. ¹⁰

Some youth have attempted to engage in agriculture as a business but almost everywhere they have been let down by lack of viable markets, characterized by the structural constraints mentioned above and an inconsistent (neoliberal) agriculture and trade policy regime that together block the youth from attaining maximum rewards for their efforts. For instance, the Bwalo la Ana Youth Active Community Organization (BLAYACO) implemented an agro-sport initiative as a way of encouraging youth to get involved in agriculture. They cultivated Irish potatoes, ‘but the enthusiasm greatly diminished when most of the Irish potatoes got damaged, valued at MK300,000’. ¹¹ In this case, in the aftermath of liberalization of the agricultural sector, markets for produce are no longer guaranteed. Prior to liberalization, the Agricultural Development and Marketing Corporation (ADMARC) offered guaranteed markets for farmers (Chinsinga, 2004; Mvula, Chirwa & Kadzandira, 2003). The youth note that the main challenge relates to haphazard opportunities for marketing agricultural produce, discouraging investment in agriculture, because ‘the markets are unpredictable due to ill-conceived government interventions’. ¹² They describe the tendencies of government as ‘discouraging because we have seen how our parents have incurred enormous losses whenever the government decides to introduce bans either on domestic or international commodity trade’. ¹³

Youth are further discouraged because most government programmes do not consider them entirely as beneficiaries. For example, they observed that Farm Input Subsidy Programme (FISP) ‘gives the impression that agriculture is an occupation only for the elderly’. ¹⁴ Youth, mostly construed as unmarried people, are excluded as beneficiaries of FISIP, because they ‘are considered energetic enough to find money to buy farm inputs, yet they are equally poor’. ¹⁵ This is further reflected in the patterns of service delivery in the agricultural sector. It is difficult for youthful farmers to access extension services. ¹⁶ Youth in Ntcheu argued that this is the case because it is only old farmers that are trained as lead farmers. This means that they target fellow old farmers in providing extension services.

The negative image of agriculture is further reinforced by the imagery of agriculture portrayed in posters in most extension efforts. The argument is that the posters that have been used are not only unfriendly to the youth but also project agriculture as ‘a poverty stricken occupation as a matter of routine’. ¹⁷ The problem is that the posters used ‘often depict old men and women dressed in rugs ploughing, leading most youth to conclude that agriculture is for adults, poor people and those who have never been to school’. ¹⁸ Such sentiments were echoed in the FGD held with members of the Likhubula Youth Club in Zomba. They pointed out that ‘agriculture is for poor people, it does not have a future, cannot make people rich, it is for those people who have been failures at school, but in addition it is strenuous for nothing’. ¹⁹ These perceptions are disputed by policymakers who argue that the elders are featured on posters as role models hoping to entice the youth to join farming.

The conclusion of the FGDs was that youth are involved in agriculture not out of free will. They contended that they are often forced by their parents ‘because it is their [parents’] obligation to teach their children agriculture as a matter of cultural routine’. ²⁰ While this is the case, parents force their children into agriculture ‘to get some helping hands … and in order to do so they often threaten them not to be given food should they decline to help’. ²¹ The message from the youth is unequivocal. They are engaged in agriculture not because they desire to do so, but because they are simply hard pressed to earn a living.

Overall, the opportunity for rural youth is rather limited compared to their urban counterparts. This has been described as the spatial and temporal distribution of the universe of more or less viable options that a young person exploits as she/he attempts to establish an independent life (Sumberg et al., 2012). The opportunity space for rural youth is limited due to widespread poverty, lack of information about opportunities, limited support networks and lack of viable markets. The situation is quite tough for rural youth because the agricultural value chain is not adequately developed. They face considerable obstacles, such as lack of access to capital finance and land, poor road infrastructure to move produce from the point of production to markets, high cost of capital equipment for agro-processing, lack of access to information and reliable energy sources (Kamchacha, 2012; Valle, 2012).

It is important to note that opportunity spaces are not a given condition but rather shaped by the balance of social struggles and power relations, largely in favour of certain classes and/or interests. Opportunity spaces mostly serve the interests of the business elites (and politicians are undercover business elites) who accumulate their capital by exploiting the youth (Gough & Birch-Thomsen, 2016; Sumberg et al., 2012). Fundamentally, opportunity spaces entail both economic and political factors that can block or facilitate social mobility of the youth. Political and economic power holders tend to use ‘near opportunity spaces’ ²² and ‘distant opportunity spaces’ ²³ (Painter, Sumberg & Price, 1994) conveniently such that the ‘near distant spaces’ can be converted to ‘distant opportunity spaces’, and vice versa, depending on prevailing exigencies. The agriculture sector received the attention of elites in Malawi because it has huge potential of contributing to attainment of both political and business interests. As demonstrated in this article, opportunity spaces in the agricultural sector for the youth in Malawi fail to make significant impact because of faulty technical and institutional designs, patronage and political hijacking.

Youth and Agricultural Policy in Perspective

Malawi has witnessed the proliferation of policies for specific sectors following the transition to democracy in May 1994 (Chinsinga, 2007). Following the 1965–1969 Development Plan, the country developed two 10-year statements of development policies regarding 1970–1980 and 1987–1996. These were basically programmatic outlines of the country’s development endeavours in various sectors of the economy. They provided the long-term developmental perspective which, in turn, guided medium-term and annual planning. These policies were negatively affected by the liberalization interventions of the structural adjustment programmes (SAPs), which dismantled state-funded agriculture institutions in favour of private ones operating on a business model (Chinsinga, 2011; Mkandawire, 2015). A domestic-led agrarian transformation suffered a heavy blow, because liberalization and commercialization of public institutions meant smallholder and subsistence farmers could not afford accessing agriculture inputs and extension services at market value. The negative effects of liberalization and SAPs on agrarian transformation in different parts of the South have been noted elsewhere (Chambati & Moyo, 2004; Moyo & Yeros, 2007; Moyo, Jha & Yeros, 2013). The rising costs in agriculture and industry induced by SAPs was a disincentive to the youth who were also already experiencing obstacles to accumulation by low returns in agriculture.

Although the statement of development policies did not specifically pay attention to the youth, their concerns were well taken into account by the establishment of the Malawi Young Pioneers (MYPs) in 1963. The MYP provided for an elaborate strategy for dealing with the question of youth employment and preparing youth to play a meaningful role in society. According to Rupiya (2002), the MYP was structured on the basis of the Israeli Kibbutz model. The MYP established training bases across the country, in 21 out of 24 districts, which implemented entrepreneurship, technical, agriculture and leadership programmes among the youth (Kamchacha, 2012). The initiative ensured that, after 3 years of rigorous training, Malawian youth would be self-employed in agriculture, trade, construction and carpentry.

The MYP enrolled all sorts of youth, from primary school dropouts to university graduates. Regardless of one’s qualification, the candidate had to undergo a 3-year rigorous training exercise that emphasized respect, discipline, physical fitness and dedication to duty (Mandiza, 2002). Those with better educational qualifications were enrolled with various training colleges, whereas the bulk of the primary school dropouts returned to their respective communities with a clear mandate to fight three deadly enemies: ignorance, disease and poverty. The impact of the MYP recruits returning to their respective communities was reportedly quite significant. As one MYP recruit pointed out, ‘youth training at MYP had significant multiplier effects at community level because when they went back to their communities, the MYP recruits were working with everyone to promote modern methods of farming which guaranteed food security’. ²⁴

The MYP was abandoned in 1993, but its relevance in the rural economy is now being reviewed, partly because of the subsequent collapse of agricultural extension services, as there are currently few extension workers on the ground. The extension policy in Malawi recommends an extension worker/farmer ratio of 1:750 for effective and efficient extension service delivery. However, the current extension staff/farmer ratio is about 1:3,900 (CISANET & LUANAR, 2013), which has led to the overburdening of the extension workers. In the past, this gap would have been informally filled by the MYP graduates. In order to address the shortfall, government and NGOs are training some local farmers to become lead farmers, so as to provide the extension services to their fellow community members. Yet, even with the lead farmer initiative in place, there have been calls for the resuscitation of MYP, because of the superior training that it provided as compared to the lead farmer arrangement, as well as its emphasis on training the youth, which is seen as a sustainable solution to addressing the woes of the extension services system in Malawi. As a proponent of bringing back MYP observed, ‘there is need to refurbish the remains of the MYP bases and put them to better use, especially to uplift the youth who are being ruined due to lack of skills’ (Chavula, 2015).

While the MYP initiative is viewed positively as a route for youth to agriculture and various vocational training activities, it was condemned for also functioning as a paramilitary wing of the former ruling party, the Malawi Congress Party (MCP). The MYP was discredited because it progressively became an instrument of political control and social militarization of Malawian society. MYP was an intelligence and suppression unit of MCP that would track down political dissidents at all levels of society. With branches and ununiformed personnel all over the country, MYP had capacity to infiltrate different spaces so as to identify those with opposing views to the official mainstream which were in turn targeted for persecution. Thus, in addition to promoting agricultural production, various vocational skills and entrepreneurship, the MYP acted as the vanguard for the defence of the nation (Mandiza, 2002; Rupiya, 2002).

The love–hate relationship with the MYP was expressed in the interviews with various stakeholders including those from the Ministry of Youth and Sports Development, Malawi Enterprise Development Fund (MEDF), traditional leaders, Ministry of Agriculture and Food Security, youths and NGOs formed and working with youth. While acknowledging the positive side of the MYP, they condemned its use as an instrument of political control and terror, which led to its abandonment. For instance, one of the interviewees described the MYP as ‘being a very good initiative that allowed youth to become meaningful and useful members of society, but it was tainted because some of the youths were used to harass and torture the people that did not agree with government on some of its policies and practices’. ²⁵ The abandonment of the MYP has created an institutional vacuum for rural youth which stakeholders are struggling to fill to date.

The transition to democracy in May 1994 was accompanied by the swift implementation of SAPs, which have had significant implications on the role of the state in matters of employment. According to Changunta (2002), the apparent vacuum that followed the abandonment of the MYP is not surprising, because SAPs relegated the state to a passive role in employment creation. The expectation is that employment is a derivative of the overall economic revival, which is to result from the economic restructuring exercises. This meant that the state would not take deliberate strategic planning and active measures aimed at employment generation, especially youth employment creation. The debilitating effects of SAPs invariably popularized what White (2012) calls ‘do it yourself employment strategy for the youth’. Instead of encouraging the state to actively drive the employment creation process, international organizations, such as the International Labour Organization (ILO), World Bank and the United Nations Industrial Development Organization (UNIDO), are encouraging the state to promote entrepreneurship among the youth as a strategy to get them employed. The currency of this philosophy was clearly reflected in the 1996 youth policy which was designed to take care of the vacuum following the disbandment of the MYP. The major weakness of this policy is that ‘it did not foresee the need to link the youth to agriculture as a priority area’ (Kamchacha, 2012, p. 13).

The links between the youth and agriculture are also absent in the 2013 National Youth Policy, although agriculture is widely regarded as an engine of economic growth in Malawi. The National Youth Policy identifies six priority areas, but none of them makes explicit linkages to the agricultural sector. These include: (a) education, science, technology and environment; (b) sports and culture; (c) health and nutrition; (d) social services and recreation; (e) youth participation and leadership; and (f) youth economic empowerment (GoM, 2013, p. 10). This means that the failure of the National Youth Policy to close this gap and ensure linkages to agriculture resulting into lack of meaningful involvement of the youth in development. It would, indeed, be difficult to ensure that youth are involved in the country’s mainstream economic activities, when agriculture, the leading sector of growth, is excluded altogether.

As critical reviews have shown (Chinsinga & Chasukwa, 2012), youths have been missing in major policies that have been formulated in Malawi since May 1994. Young people are not treated and targeted as a distinct category needing attention in a whole series of initiatives, such as the Poverty Alleviation Programmes (1994), Vision 2020 (1998), the Malawi Poverty Reduction Strategy Paper (2001), One Village One Product (OVOP) (2001), the Malawi Growth and Development Strategy (MGDS, 2006), and the (MGDS, 2012). Young people do not even appear in the sections on cross-cutting issues dominated by gender, HIV/AIDS, environment and technology. As much as agriculture is mentioned as a priority in all these policies in terms of transforming and improving the economy, the youth are not seen as key players in the sector. Similar observations were made by Bennel (2007), who argued that, as a group, young people are not a priority of most governments in low-income countries. Consequently, Ministries of Youth are generally subsumed or combined with other government responsibilities, most commonly culture, sports and education. This has translated into the affairs of the youths being given little attention, because they are only an appendage to the core business of the ministry that has a full range of non-youth activities.

The youth have also not received sufficient attention in the Agricultural Sector Wide Approach (ASWAp), which is the document inspired by the Comprehensive African Agriculture Development Programme (CAADP). Through CAADP, African governments have committed themselves to allocating at least 10 per cent of their annual national budgets to the agricultural sector, with the aim of achieving an annual growth target of six per cent (Chinsinga, 2014). The critical review of the ASWAp suggests that the youth are not an integral part of the efforts to revive the fledging agricultural sector in the country. According to the National Coordinator of the Civil Society Agriculture Network (CISANET), ASWAP ‘has overlooked the importance of youth in agriculture … yet youth make up the biggest proportion of the national population’. He emphasized that this is not unique to the ASWAP, but is the trademark of all agricultural orientated policies: they do not ‘actually talk about youth; they simply talk about males and females … and in the minds of the policy makers the distinction between youth and adult farmers does not really matter’. ²⁶

The neglect of agriculture as a possible source of employment for rural youth is manifested in the country’s curricula for vocational training. According to Valle (2012), the curriculum shows a lack of connection between the demand of the labour market and the preparation of the government of the new generation of youth. Agriculture is not among the courses offered by the Technical Entrepreneurship Vocational Education and Training Authority (TEVETA). This apparent neglect of agriculture explains why various aspects of its value chain remain hugely undeveloped and not fully exploited as a source of viable employment opportunities among youth. Agriculture is viewed mainly in terms of primary production activities that are described as ‘unattractive since they make farmers dirty on a daily basis, yet these activities are not rewarding at all’. ²⁷

The reviews of TEVETA by the youth are also not encouraging. They described it as lacking capacity to train as many youths as possible (as was the case with the MYP) and its training as substandard. For example, the Likhubula youth club members contended that ‘those who have undergone TEVETA programmes are not as competitive as those who undergo “Trade Tests” (sic)’. Moreover, there are concerns that rural youth are marginalized in TEVETA activities because they do not often have adequate information about these opportunities. While these opportunities are meant mainly for rural youth, ‘they are monopolized by the urban youth, since rural youth do not only have ready access to information about these opportunities, but they also exploit their networks and connections’. ²⁸ Training for the youth has been compromised by lack of adequate funding to the institutions that are mandated to empower the youth with skills and knowledge. For instance, the Ministry of Youth and Sports Development was allocated MK5.9 billion for 2015/2016 fiscal year. ²⁹ Out of the MK5.9 billion, MK5 billion was for construction of the Bingu National Stadium and a youth sports complex in the northern part of Malawi, Mzuzu. This means the Ministry had only MK900 million for operations and implementation of other many activities, such as economic empowerment and training for the youths that were outlined in the year. The MK5 billion in the budget for the Ministry was a loan from the Republic of China. In the previous year, 2014/2015, Government has allocated MK680 million to the Ministry of the Youth and Sports Development (Chirwa, 2015). The Ministry of Youth and Development has always been underfunded despite having more than half of the country’s population under its jurisdiction.

The Youth Enterprise Development Fund

There has not been a specific youth-orientated programme designed to promote participation of youth in the agricultural sector since the abandonment of the MYP. All the subsequent initiatives that have been implemented to address youth employment challenges appear to have been inspired by the ‘do it yourself’ philosophy, as a result of the impact of the SAPs. Some of these initiatives have included the Youth Revolving Fund (MK70 million in 1996), the Malawi Rural Development Fund (MARDEF) (MK5 billion in 2005) and the YEDF (MK3 billion in 2010) (Chinsinga & Chasukwa, 2012).

The YEDF is now under the MEDF. The MEDF was created after merging YEDF and MARDEF. The motivation for establishing MEDF was that there should be a legally sanctioned institution, because MARDEF and YEDF operated as projects without any legal status. Thus, MEDF was registered as a company limited by guarantee, in 2014. Furthermore, when Parliament passed the Malawi Microfinance Act in 2010, it was imperative that MEDF Ltd. should operate within the law and, accordingly, MEDF registered with the Reserve Bank of Malawi as a non-deposit taking microfinance institution. MEDF Ltd. took over all the assets, liabilities and operational structures of MARDEF, and is involved in all operations that were being earlier undertaken by MARDEF (Matonga, 2004).

In addition to YEDF, MEDF has several loan programmes targeting productive sectors of the economy. These loan programmes include: (a) farm input loan programme (a vehicle for improving food production at both household and national level); (b) Civil Servants Social and Economic Empowerment Network (for members among women civil servants who are given loans to engage in small-scale businesses as a way of economic empowerment); (c) Youth Employment Loans—Middle East (created to facilitate youth employment in Middle East where eligible youth were given loans to cater for travel logistics); and (d) rural loans (intended to provide loan capital to the rural poor Malawians who wished to set up or expand small businesses).

However, the YEDF stands out in terms of magnitude, emphasis and prominence as underlying the government’s commitment to address the question of youth unemployment in Malawi. Its main objective is to provide easily accessible loans to youth entrepreneurs in the form of capital equipment and working capital to venture into various areas including the agri-food sector. The YEDF programme is implemented in collaboration between the MEDF, the Ministry of Youth and Sports, and district YEDF committees. The loans are provided to youths in groups of at least 10, or in some rare cases, to individuals who have gone through a self-selection process duly appraised by the YEDF district committee and the MEDF secretariat. The YEDF is, thus, one of the components of MEDF which offers generic loans to eligible Malawians for purposes of stimulating entrepreneurship. The loans are approved by the MEDF Board of Directors.

The YEDF is characterized as ‘a key development agenda for young people in Malawi in as far as the current government policy portfolio is concerned’. ³⁰ The YEDF is a nationwide loan programme covering all the 35 local councils in Malawi, or 193 constituencies that make up the three administrative regions of the country. The view is to reach out to the wide population in all the regions of Malawi to ensure equitable distribution of resources to all the political and administrative constituencies. When it was introduced in 2010, YEDF targeted youth between 18 and 30 years, but the eligibility age bracket was extended to 35. According to its guidelines, the fund caters for out-of-school youth, both skilled and unskilled, who are expected to engage in various trades, such as agricultural production, construction, carpentry and joinery, panel beating, welding, metal fabrication and woodworks.

The YEDF thus also benefits those who have graduated from various vocational education training institutions. The successful loan applicants are then trained in various aspects of entrepreneurship and business management by district youth officers, in collaboration with MEDF secretariat. The MEDF is particularly responsible for group formation, appraisal, loan disbursement, monitoring and recoveries. The vision of YEDF is to support groups of youth that have proven technical business skills as a means for them to earn independent livelihoods and even create employment for fellow youth, particularly in rural areas.

YEDF’s Theory of Change: What Is It?

The underlying assumption about YEDF is that youth were to be sensitized about the existence of the fund and the procedures to access it through various channels. This would then motivate youth to actively seek YEDF loans to enable them to pursue their dreams in the various trades noted above. With some training in aspects of business management and entrepreneurship, youth would be able to successfully run small- to medium-scale businesses, creating employment for themselves and even for their fellow youth. This did not, however, entertain the possibility of youth starting from different points, especially since the fund caters for both skilled and unskilled and youths from various social backgrounds. YEDF’s conviction is that the training for business and entrepreneurship provided should be adequate to help youth compete on the market, regardless of the orientation of their academic qualifications and professional experience.

A comprehensive assessment of YEDF’s performance is yet to be done, but the few interviews with some key stakeholders and some youth clubs paint a rather pessimistic picture. The respondents could hardly point out a successful case of a YEDF recipient, which in many ways is symptomatic of the lack of systematic thinking about its theory of change. The deficiency is underlined by YEDF’s experiences that have, either singularly or in combination, militated against the efficacy of its theory of change. The YEDF theory of change is that the youth is not economically active because it lacks financial capital and business acumen, since young people are not trained in entrepreneurial and business management. Lack of progress by the youth is attributed to their own lack of personal initiative in order to adapt to opportunities for enhancing income. The YEDF theory of change assumes that markets are not a problem once the youths have the products because there is always demand for goods. This implies that unmet needs exist in the society which the youth can explore and earn a decent living out of them. It is assumed that the demand side of the market is vibrant and ready to absorb supplies as provided by the youth. Essentially, the youth are urged to explore niches in market and fully exploit them. The YEDF theory of change proposes that the youth can meet this demand through training in business and financial management, as well as group work.

The YEDF theory of change ignores the basic laws of supply and demand and group formation, as follows: (a) mass training of youth will lead to the market being flooded with similar products which may not be absorbed by the supply side; hence, prices will decline and the youth will be negatively affected; (b) mass training will also lead to competition in the market, forcing the youths to undercut competition through low pricing of their labour; (c) groups formed for the sake of convenience of meeting the requirements of obtaining the loan have low probability of surviving because of lack of social cohesion; (d) government, a provider of the loans, as a political body constituted by electoral procedures is not a neutral party and not interested in ‘inflicting pain’ on voters by way of recovering loans, for fear of losing votes; thus, lack of political support to the recovery of loan limits chances of survival of YEDF as a revolving fund.

The training in business management and entrepreneurship is rarely offered, and when offered, it is not adequate enough ‘to transform youth into competitive entrepreneurs’. ³¹ The training, if offered, ‘is as short as 2 days which is not enough for someone who is illiterate to say that he/she is fully equipped to start business’. ³² According to the Programme Officer at the National Youth Council, ‘it would take a year or so to train a person for him or her to be in a position to ably conduct the business of his or her choice’. ³³ The argument is that youth can only become successful entrepreneurs if they undergo proper and adequate training.

While the failure to regularly offer training to successful YEDF applicants as a matter routine is attributed to shortage of funds, the situation is further complicated by excessive political interference. The YEDF administrators are sometimes forced to skip procedures made by politicians. To this effect, it is argued that ‘politicians put pressure on us to disburse loans to groups that they have facilitated to create regardless of the laid out procedures … all they want is to score a political point’. ³⁴ Political interference in YEDF has become routine, given that politicians see it as ‘a way of saying thank you to the youth who supported them in their campaign for office in the May 2009 elections … and to mortgage their support for the forthcoming May 2014 elections’. ³⁵ This has resulted in the majority of politically connected youth getting the loans either with inadequate or no training at all. The negative impact of the dominance of the politically connected recipients is that ‘it has created the impression that YEDF is free money … and the repayment estimated at 23 per cent speaks for itself’. ³⁶ As of January 2016, the MEDF had loan defaults amounting to about MK7 billion (Jassi, 2016). Approximately MK1.7 billion which was disbursed as loans in the first and second phases of MEDF was written off because the politically connected youth could not make repayments. The political influence in disbursement of loans is still continuing, as complained by MEDF in a memo to the Chief Secretary of President and Cabinet: ‘[w]e write to inform you Sir, about the threats that MEDF management is receiving from Democratic Progressive Party cadre [referring to the ruling party] who are demanding loans from the institution. The threats range from the Chief Executive Officer being told that he has been dismissed to death’ (Chikoko, 2015). It is thus the political exploitation of YEDF in this way that led to the age limit for youth to access it to be extended to 35 in order to expand the catchment of patronage.

It is also important to note that there is internal competition over policy frameworks within YEDF in addressing the challenges faced by youth, as between the entrepreneurial and business development approach, on the one hand, and the welfare approach, on the other. When YEDF was first introduced, the successful applicants were asked to put up collateral, but this was abandoned just after 1 year. This was done because most youth ‘were putting up their parents’ property as collateral, which ended up being confiscated in the event of default’. ³⁷ The requirement did not make much sense, since most of the youth does not own property (Valle, 2012). When this requirement was scrapped off, YEDF resorted to offering youth capital equipment and start-up capital to put the equipment to immediate use (Kamchacha, 2012). Even with this change of approach, the agricultural sector remains at the periphery of policymaking and marginalized. Most of the equipment in stock has nothing to do with the agricultural sector. The emphasis is on vocational activities such as welding, carpentry and brick layering. While MARDEF meets the successful groups once a month, the purpose is merely to collect payments from them; there are hardly any efforts to reinforce their business skills and managerial expertise. This was emphasized in an interview with a MEDF official who observed that ‘the problems that the successful groups face while doing business are theirs and not ours’. ³⁸

Youth have reportedly resented the idea of splitting the loan into two parts: capital equipment and start-up cash. They would rather have it all in cash, because ‘they would want to use it to process passports to go to South Africa to search for greener pastures’. ³⁹ For many, this is linked to the inadequacy of the theory of change underlying YEDF. As a result of lack of viable markets, business ventures are failing to take off even when the youth are determined. In turn, this has made ‘going to South Africa an attractive option for the youth, and YEDF as the source of money to procure a passport’. ⁴⁰

YEDF should place more focus on agro-processing aspects, as youths perceive farming as a dirty, low-return activity for the poor. Creating viable markets for the youth is critical to realizing the desired change, but it requires a certain type of policy framework which is insulated from political pressure. The current political relations work against such a policy change. Neoliberalism and inconsistent policy, particularly in agriculture, is a key constraint, as is the current arrangement in YEDF, whereby welfare transfers through entrepreneurship programmes are instrumentalized by political elites and policymakers to play a mediatory role to manage votes via election campaigns. Consequently, the social mobility of the youth is low. Otherwise in the current context, emigration to South Africa emerges as a key option for the youth, and perhaps the transfers are manipulated for this purpose.

The main preoccupation of most stakeholders was that YEDF was not achieving its desired strategic goal because its institutional framework for bringing about intended outcomes was incomplete. The argument is that YEDF would have brought about some positive change if it were designed in such a way that the successful applicants could be linked to viable markets. There are some youths that are committed to exploiting YEDF as a lever for their upward social mobility, but ‘they are unable to make it, because there are no viable markets for them to sale their products…this essentially demotivates the youth’. ⁴¹ The main concern is that it is difficult for youth to break into the existing markets that are jealously guarded by the privileged few that have close links to the government as the main client. It is, therefore, impossible to expect YEDF to facilitate the creation of transformative employment opportunities. It is more or less a handout for politically well-connected youth.

Conclusion

The article has shown that the linkages between agricultural policy, employment and social mobility for rural youth in Malawi are limited. The main reason for this is that major policies have been virtually silent on how to engage youth in the agricultural sector. Moreover, since the abandonment of the MYP, there has not been any specific youth initiative or intervention linking youth to agriculture. Even the ASWAp which is a CAADP-inspired document for revitalizing the agricultural sector is silent on youth. The youth is not considered as a distinct constituency requiring particular attention. Youth policies have not helped either. Both the old and the new do not espouse explicit linkages with the agricultural sector as one of the major sectors that can make a difference in the lives of youth. This is partly attributed to the consequences of the neoliberal economic agenda, leading governments to disengage from active employment creation. The fashionable strategy to deal with youth challenges has been to emphasize the promotion of entrepreneurship. It is, therefore, not surprising at all that agriculture does not feature in TEVETA courses.

The cumulative impact of all this is that youth in Malawi do not look at agriculture as a viable avenue for upward social mobility. As demonstrated in this article, agriculture is condemned as an old-fashioned, unrewarding, dirty occupation for poor, elderly and rural people. Even among rural youth, agriculture is regarded as an occupation of last resort. This is further reinforced by various government programmes implemented in the sector that routinely exclude youth, giving the impression that agriculture is an exclusive domain for the elderly. The YEDF, in particular, remains biased against the agricultural sector and has been a failure on account of its institutional framework, which is incomplete. It does not link the youth to the markets; hence, it only manages to create protective rather than transformational employment opportunities. The implication is that youth in Malawi will continue to be neglected in the opportunities emerging in the agricultural sector such as export promotion, diversification, value addition and agro-processing.