Replacing Tobacco in Malawi

Agricultural Diversification (AgDiv), a project supported by USAID/Malawi’s Feed the Future initiative, was mandated to help small farmers diversify away from an over dependence on cultivating maize into peanuts, soybean, and orange flesh sweet potato. The project found a partner in three tobacco companies that were also trying to get the farmers they worked with to diversify away from growing tobacco—the demand for which was declining rapidly. They realized that they needed to increase the productivity of peanuts and soybeans to make the returns from cultivating them comparable to that of tobacco. The USAID project was able to achieve it by partnering with other USAID-supported programmes, public institutions in Malawi, and private enterprises. The efforts strengthened the value chains, with incentives for private enterprises to invest along them, benefitting both the farmers and the economy. A rich case to discuss public private partnerships and deciding where to intervene to develop value chains.