Agribusiness SMEs in Malawi: assessment of small and medium enterprises in the agriculture sector and improved access to finance in Malawi
This report by USAID and ACDI/VOCA (PDF) presents an assessment of agri-business small and medium enterprises (ASMEs) in Malawi. It was found that this is a sector with diversified business ownership, in which owners commonly operate multiple businesses and can be classed as ‘portfolio’ owner-managers spanning both agri-business and non-agri-businesses. A portfolio enables them to move resources to address cashflow shortages and seasonality in each business, manage uncontrollable downside risks by moving resources from businesses affected by such a risk, and manage growth opportunities by investing in businesses that are making most progress. A key implication is that it is difficult for public sector and donors to invest in specific value chains, as owners move resources within a portfolio of businesses that span more than one value chain and may include non-agri-businesses. The analysis is particularly focused on ASME access to finance, use of business development services, use of information and communication technology, collaborating and clustering and the enabling environment. For Malawian ASMEs, the way forward depends on tailored, common sense approaches that are key to increasing their competitiveness.