‘When we have nothing we all eat grass’: debt, donor dependence and the food crisis in Malawi, 2001 to 2003

Abstract

In 2002, Malawi faced a devastating food crisis, an event in which hundreds of people died of hunger, while over a thousand succumbed to a country-wide cholera epidemic. By June of that year, over 3.2 million people needed emergency food aid, one-third of Malawi's population. This article assesses the crisis through the lens of donor–government relations. Beginning with the restructuring of the agricultural sector under a World Bank-sponsored structural adjustment programme, a process that discouraged food production by small-holder farmers, the article explains how the Malawian government's reliance on external sources of funding, and its deteriorating relations with key international creditors, rendered it impotent in the face of the oncoming crisis. Having sold its strategic grain reserve (SGR) to service mounting debts, the government could not rein in a food price spiral that peaked in March 2002. Allegations of financial irregularities surrounding the sale of the SGR served to make matters worse. The United States, Britain, Denmark and the European Union cancelled direct development funding and the International Monetary Fund (IMF) and World Bank suspended Malawi from the Highly Indebted Poor Country (HIPC) initiative. With limited access to credit, the Government of Malawi could neither re-stock its food reserves nor fund emergency imports in time to mitigate the worst effects of the crisis. Relief aid was further delayed by disagreements between the government and key donors and aid agencies regarding genetically modified (GM) food. While accepting Amartya Sen's basic entitlements framework – the 2002 crisis was one of pricing and access rather than absolute shortages of food – the article posits the following theoretical argument: in the context of highly indebted poor countries, it is a government's relationship with its principal donors and creditors that determines the outcome of food crises by shaping the policy responses available both leading up to and during the event.