could fall into this category include food-for-work projects and possible direct income transfer
activities.

4.2 Public Programs to Deal with Transitory Food Insecurity

 The performance of markets and public interventions can either mitigate or aggravate
transitory food insecurity and its ill effects. In a well functioning market, prices reflect the
relative scarcities in markets. Consumers make adjustments according to these prices to mitigate
the potentially harmful effects of food scarcity on their diet. A rise in prices reflecting scarcities
also signals supply incentives. During a drought, for example, there would be incentive to grow
drought resistant crops.

 Until now, the response of the Malawian government and donors to drought has largely
been reactive. The first indication of potential problems comes with the experience of a poor
rainy season. Crop estimates are made, and on this basis, the size of the production gap is
identified. This "gap" is divided into the amount required to stabilize the commercial market -
commercial imports and the amount required to distribute directly to the affected sections of
the population. Stocks in country and the amount of grain available in the Strategic Grain Reserve
(SGR) are calculated, and an appeal is made for the food aid required. Commercial food aid has
been distributed through ADMARC and emergency food aid has, until last year, been distributed
free to targeted beneficiaries4. In 1995/96 a Food for Work (FFW) component was introduced.

 These programs are clearly costly and involve considerable non-food resources.
Both the release of food through ADMARC and the free distribution programs are likely to have
an unpredictable effect on the developing private maize market. Although there are limits to what
can be done to "drought-proof" the Malawian economy in the short run the most effective
drought-proofing is development and growth, with concomitant diversification and reduced
reliance on the agricultural sector there are actions that government can take to reduce the
impact of drought on both the household and the economy.

 As has already been stated, vulnerability to drought is increased by dependence on
agriculture, and, within the food sector, dependence on a relatively drought-susceptible crop such
as maize. As at the national level, the more diversified the household's sources of food and
income, the less vulnerable it is to drought. Over the last few years, smallholder farmers are
taking action themselves to diversify cropping patterns away from such a heavy reliance on maize
as there was in the 1980s. More land is being planted to drought resistant crops such as cassava.

 The government can support this trend toward diversification by ensuring that agricultural
extension messages not focus on maize alone. In addition, improved husbandry techniques, 4 -
including elements of soil and water conservation and better use of organic material can be


 4 A discussion of the targeting procedures used is contained in Annex E.