In the Field: “Revolutionary, Even for the World Bank”

An OPEC Fund delegation travelled to Malawi in April 2023 to appraise the Shire Valley Transformation Program – a multi-sector project set to revolutionize the economy in the south of the country. Public Sector Director for Eastern & Southern Africa Khaled Al-Zayer and Country Manager Sonia Siserova toured the site alongside analysts and environmental experts from the World Bank, the African Development Bank and others. 

With Phase II co-financed for a total of just over US$224 million, the program will increase agricultural productivity and commercialization, while improving the sustainable management of natural resources. Specifically, the program will provide access to reliable gravity fed irrigation and drainage services, as well as securing land tenure for well over 50,000 smallholder families – including more than 15,000 female-led households. 

Ms. Siserova explains: “Shire Valley is one of the poorest areas in Malawi, where local people rely on agriculture, but cannot produce enough to satisfy their needs. Many still rely on food aid. A major part of the project is to bring together thousands of smallholders into collectives and share resources such as seeds and livestock, while building storage areas and new roads to markets. Basically, upgrading the entire value chain. 

“The project covers a large area, comprising not only the main canal, but also secondary and even tertiary canals. Putting all this in perspective, the World Bank representative who was touring the site with us said that they’d never done anything before on this scale. It’s revolutionary, even for the World Bank.” 

Broader environmental aspects were also under scrutiny by specialists sent by co-financing partners. “The attention given to this initiative is tremendous,” says Mr. Al-Zayer. “It’s a complicated program, so several environmental experts were brought in to solve a number of problems that arose during the construction phase. For example, the World Bank spent an additional US$4 million on a barrier to stop tigerfish migrating from the Shire River to Lake Malawi.” 

Ms. Siserova adds: “This was important because Lake Malawi is such a strategic resource for the country, with so many people depending on the fishing industry. Tigerfish are generally apex predators with voracious appetites, and they can jump around 2 meters out of the water. The World Bank made a recommendation and then built a 3-meter barrier in the main canal to contain the tigerfish. It’s a good example of environmental and social governance in action.” 

The Shire Valley Transformation Program will also reinforce the management of wetlands and protected areas, including the nearby “Elephant Marsh” – an area spanning 60,000 hectares, which is home to hippos, rare butterflies and 20,000 waterbirds. The marshland also plays an important role in water storage, flood control and the supply of nutrient-rich sediment. Ms. Siserova says: “The dam and the intake are part of a natural reserve, so it’s been very important to build in a sustainable way to the highest of standards. To protect the reserve, a fence was temporarily erected, but will be removed once construction is finished and the program is operational.” 

After visiting parts of the dam and intake, which are located in a rural disaster-prone area and which had been damaged by Storm Ana in January 2022, Mr. Al-Zayer reports: “Malawi is often hit with crises, from droughts to cyclones, practically every year. This project will provide more climate-resilient and sustainable agriculture for the local communities, helping to mitigate both floods and droughts.”   Indeed, Malawi had been hit by yet another cyclone in the form of Storm Freddy just one month prior to the visit. While the program area was not heavily affected this time, violent flash floods and landslides caused extensive damage to homes, schools, health centers, agricultural lands and infrastructure and left more than half a million people displaced and in urgent need of humanitarian assistance. 

In response the OPEC Fund approved an emergency relief grant of US$300,000 in April 2023. Channeled through the International Federation of Red Cross and Red Crescent Societies, the funds addressed immediate needs including shelter, healthcare, water and sanitation for more than 150,000 people in five districts. The relief work also aimed to restore livelihoods and strengthen resilience by providing cash assistance and in-kind items. 

Mr. Al-Zayer sums up: “The development impact of the project is excellent, covering everything from climate and environmental issues to declining soil fertility and quality of crops, beside various institutional challenges. We are now preparing downstream investments for Phase II and look forward to the opportunity of participating in Phase III of this massive multi-year program.”