Learning from Brazil: Adapting “Fomento” for Malawi

Malawian groundnuts (Photo credit: Alan de Brauw/IFPRI 2014)

Malawian groundnuts (Photo credit: Alan de Brauw/IFPRI 2014)

The impressive development of the Brazilian economy and the success of its government-run social programs, in particular those aimed at smallholder farmers, suggests that there is much to be learned from Brazil’s experience. In particular, Brazilian-style programs, modified to function in new locations, could have a significant impact on the well-being of smallholder, family farmers in various African contexts. In collaboration with Innovations for Poverty Action (IPA) and the National Smallholder Farmers Association of Malawi (NASFAM), IFPRI-DC is implementing and evaluating a pilot project modeled after a specific transfer and extension program in Brazil, called Fomento.

In Brazil, the ultimate goal of Fomento is to provide poor family farmers with the support needed to lift them from subsistence level farming to some level of commercial production. Poor smallholder farmers are identified from Brazil’s national poverty database, the Cadastro Unico, and those farmers receive initial visits from extension agents who are part of the Brazilian Technical Assistance and Rural Extension program. These extension agents work with families to design individualized plans to increase or diversify production, including activities with deadlines and stages.  After they agree to the plan, the family receives cash transfers intended to help them implement the production plan. Extension agents revisit households over the next two years to monitor whether the transfers are being used to implement the production plan.

Families must demonstrate that the production plan is being followed to guarantee they receive all of the cash transfer payment installments. At the conclusion of the plan period, the intent is that families will have been lifted to a sustainably higher level of production. They can then be linked to markets for sale, whether they be government markets (the government-run food buying program, Purchase from Africans for Africa) or commercial markets.

Due to a lack of national databases and a relative paucity of government extension workers, to make Fomento work for Malawi, the program has been modified as follows. Newly registered groups in Ntchisi and Mponela (less than 6 months) will be selected to be part of the research activities. All farmers in the farmer groups will receive the standard NASFAM services. Randomly selected groups (half) will participate in devising a production management plan, and in a cross-cutting randomization, groups will either receive a one-time cash transfer targeted for production or inputs required to grow target crops (largely groundnuts), which are equivalent in value to the cash.  The goal of distributing cash or inputs to farmers is to learn whether capital constraints are hindering farmers from achieving better management of their farms.  In sum, the research arm will have six arms, labelled A through F in the table below:table for alan post







The goal of the randomization is to understand whether the cash or inputs have multiplier effects on the effects of the written management plan and additional extensionist oversight.  Due to the cross-cutting design, we can measure impacts on outcomes such as crop yields or the total value of farm output. The study will take place over two years (through the 2016 harvest), with the management plan and the extension lasting two years so that we can study whether there are lasting effects of the intervention. Due to detailed budgeting by NASFAM, cost-benefit analysis can occur as well. Finally, a similar program is being concurrently implemented in Senegal so something akin to cross-country evidence can be measured as well.