Editor’s note: This is one of a series of posts by students from Michigan State University in the U.S. and LUANAR University in Malawi who participated in the Frugal Innovations Program of the Global Center for Food Systems Innovation.
By Kevin Mills
Since my last blog, I had an extremely eventful couple of days. Outside of meeting with market management and the vendors for the market in area 25A, the practicum traveled to Lake Malawi after visiting a wholesale market run by a farm cooperative. The lake was beautiful and it was a great experience.
The LUANAR students told us that we were no longer “half-Malawian” because we had finally visited the lake. Sunday was a partial free day and I spent the early part of that day climbing the hill near campus and afterwards making my way out to climb Mount Bunda with Devin.
The experience was terrific, the view was breathtaking, and my legs are still sore. After a helpful additional session with our professor, the director of student affairs for LUANAR arranged a meeting between myself and the Bunda Students Union. As a member of James Madison College Student Senate, which has about 40 senators for around 1,200 students, I found it slightly odd that they service 4,000 students, but only have 14 members of their Union.
Despite being, in my opinion, understaffed, they seemed extremely enthusiastic and ambitious. We were both eager to learn about our respective student groups and we exchanged details on our constitutions and levels of involvement in the community. They provided some pretty great ideas about prospective student interaction and I hope that I tossed them some great ideas regarding student involvement and the advancement of LUANAR. Perhaps BSU at LUANAR can become our colleagues to enhance the interaction between our two universities. Since both LUANAR and MSU are heavily agriculturally-based, I’m sure that we can work on an exchange program between the two universities.
On a more academic note, I feel that I have been learning a lot, not just about policy formation and the difficulties surrounding access to capital, but also about myself. I was hoping that this journey was going to shape up into more than just an academic experience, and it has. I’ll spare you the diary and focus on our academic experiences here.
Area 25A had some pretty great insights into the struggles surrounding the vendors in regard to access to capital. Cooperatives, while initially thought not to be a practice in 25A, once were used to secure microfinance loans. However, as is the case with some criticisms of microfinance, the fish commodity cooperative had some vendors that used the loans to balance out household expenses rather than invest it within the business.
Many of the vendors now are hesitant to form a cooperative as a result. Additionally, since profit margins are so low in comparison for some, the initial investment into a cooperative – say to buy a truck to ease transportation costs – does not appeal to others that are better off. The problem, according to the vendors within our last focus group, is not the vendors’ unwillingness to form public associations, but it is the lack of initial start-up capital that hinders them. However, we have heard the examples from Tsoka market and the cooperatives there that provide, not only a safety net for failing vendors, but also services that reduce costs and thereby make a profit.
Another interesting issue about microfinance was highlighted on our trip to Salima and extenuated in conversation on microfinance with Beatrice, who works with the National Association of Small-Holder Farmers of Malawi. Microfinance, especially among farming cooperatives, is given out in the form of raw materials rather than capital. For example, rather than cash that can potentially be used for whatever within the household, things like fertilizer or livestock are given in order to grow profits from the resulting food production. The problem is that these options are not really available to vendors in the marketplace. Potentially, one could provide the raw materials to build permanent shops or to fix market issues that are not being addressed by City Council. However, this may be less practically applicable to vendors than to farmers since the microfinance loans of the farmers are contributing to actions that they know from their livelihood. Vendors sell things, they are not construction workers.
The problem of the vendors leaving the 25A market for other markets or to sell close to the customers is another issue that is inhibiting public associations. It seems to me that the solution has to be to incentivize the vendors to come into the market. While increasing the dues for vendors closer to the entrance and not in their designated market area seems like a good plan – these vendors are receiving more customers by virtue of proximity and; therefore, can afford the increased dues – it seems that this would drive these vendors away from the market entirely rather than bring them inside. However, we discovered that the long-standing vendors within the market usually charge a fee of 2000 Mk to new vendors. While this fee does not have a payment schedule and usually goes toward providing a safety net for vendors, many new vendors would prefer to leave for other markets, namely the larger and more trafficked 25B.
While we have not worked out all the solutions to the main issue of access to capital for 25A, I believe that we had a valuable experience interacting with these market actors that are key to the food systems here. The experience has not yet lost its allure despite an unfortunate accident on our last day in the market following our focus group involving sugar cane, a Swiss army knife, and a distracted young man that resulted in a harmless 3 stitches on the left hand and extreme embarrassment for the Muzungu in front of quite a few vendors and his classmates.
I won’t name names, but I believe the scar will remind this person to be a bit more careful with knives – despite being a cook in South neighborhood at MSU – when half a world away from home.