MWANA ALIRENJI FARM PROJECT

Project description

Mwana Alirenji farm project is located in Chikwawa District, Southern Malawi. The district is strategically located along the Shire River, the only outlet of Lake Malawi, giving guaranteed access to water for irrigation farming. The project seeks to embark on commercial irrigation farming venture growing chili, cotton and soybeans, and aims to achieve sustainable agricultural production and fostering economic growth. The commercial irrigation farm will be equipped with state-of-the-art irrigation infrastructure, including canals, pumps and water storage facilities, among others. This will ensure that the farm has reliable water supply throughout the year from the Shire River, even during periods of drought.

The project will be operated by a local cooperative, the Mwana Alirenji cooperative, which plans to develop the commercial irrigation farm on a total land area of 844.9 hectares, with total irrigable land area of 793 hectares, representing 93.9% of the total farm land. This will allow the Cooperative to produce high quality agricultural commodities year-round, regardless of weather conditions.

The project is seeking an investment partner to contribute additional capital through equity or loan or off-taker pre-financing.

Mwana Alirenji Cooperative aims for smooth and efficient operations, cost-effective production, scalability and effective risk management. The Cooperative has developed an operational management plan addressing governance and management structure, and dividend and benefit sharing policies.

The Mwana Alirenji farm project is being promoted under the Shire Valley Transformation Programme (SVTP). This is a 14 year (2018-2031) a government of Malawi initiative aimed at transforming the Shire Valley in Malawi into a productive and resilient agricultural hub. It aims to irrigate about 43,000 hectares of land with water abstracted from the Shire River and conveying it by gravity to the irrigable area in Chikwawa and Nsanje Districts through canals. The World Bank, the African Development Bank, and the Global Environment Facility fund the programme.

Financial requirements

Total project costs are estimated at EUR 7.4 million (US$ 8.1 million)

Funding Breakdown:

• Shire Valley Transformation Programme (SVTP) Grant: EUR 5.6 million (US$ 6.1 million)
• Remaining Funding Gap: EUR 1.9 million (US$ 2 million) to be secured through loans, or off-taker pre-financing

Proposed investment model

• Equity-based investment for revenue generation
• Investment Cost per Hectare: EUR 9,374 (US$ 10,228)
• SVTP Contribution per Hectare: EUR 7,012 (US$ 7,650)
• Cooperative Contribution per Hectare: EUR 2,363 (US$ 2,578)

The SVTP’s unit contribution per hectare of EUR 7,011 (US$ 7,650) falls within the World Bank’s recommended ceiling of US$ 8,000/hectare of land for the entire investment cost.

Contact

The Project Coordinator

Shire Valley Transformation Programme

16 Chilembwe Road, Namiwawa

P/Bag 379

Chichiri

Blantyre 3

Malawi

E-mail: info.doi@svtp.gov.mw