Preamble
In my last entry, I took a deep dive into government spending, specifically the heated debate surrounding the Constituency Development Fund (CDF). It’s a critical issue right now because the amount allocated to each constituency is set to skyrocket from K220 million in 2024 to an astonishing K5 billion per constituency per year starting in the 2025/26 fiscal year. This significant increase has sparked debate over who should control the CDF: the MPs or the Councillors?
To give some context, here’s a brief overview of the trends in CDF allocation over the years:
- 2006: It all began with K1 million per constituency.
- 2020-2023: The funding gradually increased from K40 million to K100 million.
- 2024: It doubled again to K200 million and was then slightly raised to K220 million.
- 2025/2026: In a bold announcement, President APM revealed that each constituency would receive an incredible K5 billion.
Many MPs and analysts have labelled this drastic increase as a “game-changer.” It’s seen as a pivotal moment that could shift developmental power away from central government technocrats and place it directly in the hands of the grassroots communities.
Given these numbers, I argue that Malawi’s problem is not just resources-It is about incentives.
Introduction: The wrong diagnosis
Malawi’s development struggles are often framed in terms of scarcity. Many people point to the country’s limited resources, limited financial flexibility, ongoing foreign exchange shortages, inadequate infrastructure, and heavy dependence on aid as key reasons for its challenges. This perspective suggests that the solution is simple: if we can mobilise more domestic revenue, attract more investments, and increase funding for essential sectors, the problems will be solved. However, while there is some truth to this view, it fails to capture the full picture of what the country is experiencing.
If we look at how Malawi has developed over the years, it’s clear that having access to resources alone doesn’t tell the full story. The country has received significant external funding, made numerous policy changes, and restructured its institutions multiple times. Yet, despite all this effort, the results have often been mixed and sometimes even temporary. This ongoing disconnect between what Malawi has invested and the progress it has made indicates that the real issue isn’t just about the number of resources available, but rather about how those resources are managed and utilised.
Malawi’s development challenges go beyond simply having enough resources; they really come down to the incentives in place. It’s not just about what’s available, but about motivating individuals and institutions to use those resources effectively and in ways that truly benefit the community.
Resources don’t just magically find their way to where they’re needed; they are distributed based on choices made by people and organisations operating within specific political, bureaucratic, and economic contexts. These decision-makers are influenced by a range of factors, from the pressure of elections and the rules of their institutions to economic opportunities and social expectations. Therefore, the results of development aren’t solely determined by what resources exist; they are more about the motivations and reasoning behind the choices made along the way.
The vision of Malawi 2063 is compelling, aiming to transform the country into a self-reliant, industrialised, upper-middle-income country. It’s an ambitious goal that truly outlines a brighter future for the nation. However, achieving this vision goes beyond just having a solid plan; it hinges on creating the right incentives within the system to bring these plans to life. It’s essential for everyone involved to be motivated and supported so that together, we can turn this vision into reality.
In Malawi’s development landscape, how different leaders act reveals much about the challenges they face. Politicians, like Members of Parliament, ministers, and councillors, are caught in a cycle driven by elections. They need to show immediate results to their voters, often focusing on projects that deliver quick, visible benefits. This emphasis on short-term wins means that initiatives like maize subsidy programs, road construction, or borehole installations tend to take priority over investments that might pay off in the long run. For instance, the ongoing focus on maize instead of livestock highlights this dilemma. While livestock may provide significant long-term benefits to the economy and nutrition, it doesn’t offer the same instant gratification or political rewards as maize does. In many ways, this reflects the pressing need for immediate results that overshadows more sustainable, long-term solutions.
This dynamic sits in tension with Malawi 2063’s long-term aspirations. While the strategy emphasises structural transformation, industrialisation, and productivity growth, political incentives often favour consumption-oriented or short-term interventions. The continued prioritisation of maize over livestock illustrates this clearly. While livestock aligns better with diversification and wealth-creation objectives under MW2063, maize remains dominant because it aligns more closely with political incentives.
The limits of the resource narrative
The appeal of the resource-based explanation lies in its simplicity. It paints a clear picture: with more resources, you can invest more, and that usually leads to better outcomes. This idea is the backbone of many development policies and international aid programs. However, there’s a crucial aspect that this model overlooks: resources don’t just fall into place on their own. How resources are distributed is closely linked to the political landscape and institutional structures. Budgets aren’t just impartial tools designed to maximise efficiency; they arise from intricate negotiations, power dynamics, and strategic decisions.
Public finance goes beyond just dealing with numbers and budgets; it’s really about understanding people and what drives their choices. Even if we have an abundance of resources, how effective they are depends on how we decide to use them, where we focus our efforts, and the incentives that guide those decisions. At its core, it’s about recognising the human aspects that influence financial choices. When we discuss resource availability, it’s not merely about having enough of what we want or need. If we don’t take into account how incentives play a role, we might end up with results that don’t make much sense or aren’t particularly beneficial. The issue isn’t just about a lack of resources; it’s about whether our goals and motivations align with what’s genuinely necessary.
Incentives and the logic of decision-making
To truly understand Malawi’s development journey, it’s important to delve into the motivations of the key players. By exploring what inspires both individuals and organisations in this process, we can gain valuable insights into the nation’s progress and the challenges it faces. A closer look at these incentives will help us connect the dots and appreciate the complexity of Malawi’s development landscape.
Political leaders often face a tough balancing act during election cycles. They need to make an impact and show quick results to build support, which often leads them to prioritise initiatives that can deliver immediate benefits. A great example of this is agricultural subsidies, especially those for maize. These subsidies have a tangible effect on people’s lives, directly helping farmers and communities. When voters start to see the benefits in their own lives, they quickly connect the dots between those positive changes and the leaders who championed those initiatives. This connection shapes how leaders choose to prioritise their goals and roll out programs that resonate with their constituents.
When we think about investments, it’s interesting to notice how some projects get all the attention while others fade into the background. Those flashy, ambitious initiatives that everyone raves about tend to steal the spotlight. But what about the quieter, less glamorous investments? Things like long-term institutional development, keeping our systems running smoothly, or even boosting livestock production are often overlooked, even though they can have a huge impact down the line. The perks of these projects might not be immediately noticeable and could spread over a wider area, making it tough to tie them directly to immediate political wins. Because of this, they often end up low on the priority list, even though they hold significant economic promise. It’s a shame, really, because sometimes the most valuable efforts are the ones that require patience and a long-term vision.
Bureaucratic workers typically function within systems that prioritise following rules and avoiding risks. Civil servants often find themselves evaluated more on how closely they follow procedures than on the results they deliver. In this kind of environment, straying from established guidelines, even if it means achieving better outcomes, can pose real personal risks. As a result, it makes sense for these workers to focus on doing things by the book rather than trying new ideas, even when those innovations could enhance service quality. This creates a structural constraint on the implementation of transformative policies envisioned under Malawi 2063, which require adaptability, coordination, and problem-solving capacity. This mindset helps explain why many reforms tend to get stuck during implementation, even when they are sound in theory.
Economic actors bring an additional set of motivations into the mix. Contractors, suppliers, and private-sector players are quick to notice the opportunities that come with public spending. When there’s a lot of money involved, it’s natural for these actors to try to sway decisions about where that funding goes, especially in areas like infrastructure and procurement. This tendency favours flashy, high-profile projects over more practical investments that can really drive productivity, such as value chains, agro-processing, and industrial connections. These elements are crucial to Malawi’s vision for 2063.
Development partners play a significant role in shaping outcomes, often guided by their own incentive structures. They tend to focus on measurable outputs, project timelines, and accountability to their external stakeholders. While this focus can yield quick wins, it may also lead to fragmented interventions that overlook the importance of long-term institutional growth. While this approach might yield quick wins, it can also lead to disjointed efforts and shift focus away from the essential long-term development of our institutions. This misalignment hinders the broader changes we need to achieve our goals under the Malawi 2063 vision.
Meanwhile, citizens, who are often grappling with immediate challenges in their daily lives, tend to prioritise visible and quick improvements in their living conditions. This natural inclination toward rapid change creates a strong demand for short-term solutions, which, in turn, influences political and policy decisions. The cycle of short-term focus from both partners and citizens can make it difficult to invest in sustainable, long-lasting progress.
When incentives shape outcomes: Sectoral Illustrations
You can really see how this system of incentives affects various sectors. The impact is clear and touches many areas of our lives.
In the agriculture space, it’s fascinating to observe that maize frequently steals the spotlight (from Starter Packs, FISP and AIP), often overshadowing livestock. This trend reveals how political factors may sometimes outweigh economic logic. While we all understand the importance of livestock, which provides income, improves nutrition, and boosts resilience, it often doesn’t get the funding it truly deserves compared to maize. This isn’t due to a lack of awareness; rather, it’s shaped by the differing incentives that influence these two sectors. It’s a reminder of how complex and interconnected agriculture can be, involving not just farming practices but also economic and political landscapes. I have previously noted that farm input subsidies attract funding for various reasons. Politicians seek votes, technocrats aim to secure their jobs, transporters are involved in the distribution of fertilisers and seeds, and seed multiplication companies have their own business motivations. Additionally, there are rent-seeking behaviours influenced by patronage.
In the world of public finance, it often feels like budget decisions are more about striking deals than following a clear vision for the future. We might have impressive policy documents outlining our ambitious development goals, but the reality of how funds are allocated and spent often tells a different story. This disconnect can result in critical systems being underfunded and resources being allocated inefficiently. Consequently, we see a frustrating gap between the plans we’ve laid out and what’s actually happening on the ground. This cycle can really hold back meaningful progress and improvements in our communities, leaving many wondering when and how real change will come.
Infrastructure investment often highlights how our choices can sometimes miss the mark. Frequently, projects are chosen based on their visibility or political appeal, rather than their genuine economic benefits or their potential to improve connectivity. Take, for example, the Zomba-Jali-Phalombe road; I believe this road was developed more out of political necessity than to drive economic growth. This results in a situation where some areas thrive while others lag behind, leading to neglected resources and growing maintenance challenges. It serves as a reminder of the importance of thoughtful planning and prioritising the real needs of the community over flashy projects.
These trends aren’t isolated incidents; they reflect a larger issue within a system that often values incentives over the community’s real needs. It’s a crucial reminder to focus on what truly benefits everyone, rather than opting for solutions that are merely convenient or easy for decision-makers to see. We need to keep the community’s well-being at the forefront of our choices.
When different incentive structures come into play, the outcomes often make sense within their own context but miss the mark on what’s best for development. This helps explain why Malawi’s development trends sometimes seem contradictory. For instance, despite strong arguments for diversifying beyond maize, agriculture remains heavily focused on this single crop. Infrastructure projects are often chosen based on their visibility rather than their economic benefits. Subsidy programs persist even as questions about their long-term viability linger. Recent discussions regarding the Constituency Development Fund (CDF), particularly the proposal to increase allocations to MWK 5 billion per constituency, emphasise how control over financial resources becomes a point of contention among political players. Each player attempts to direct spending in ways that benefit their own interests.
These patterns are not coincidental; they are a natural outcome of a system where incentives are misaligned with long-term development goals. In this regard, Malawi’s development system is not failing; it is operating precisely as intended. In the ICT space, it is known as garbage-in, garbage-out.
The cost of misalignment
When the incentives driving a project don’t match the goals we’re trying to achieve, it can create a lot of problems down the line. This misalignment leads to unintended outcomes that affect not just the project but also the people involved and the larger community. It’s essential to ensure everyone’s motivations align with the shared objectives to foster positive, meaningful development.
Resources are allocated inefficiently, with a bias toward short-term, visible interventions at the expense of long-term investments. Institutions exist in form but remain weak in function, as enforcement is inconsistent and accountability mechanisms are selectively applied.
Reforms can be a tricky business. Even when they’re based on solid reasoning, they don’t always bring about the change they’re meant to. As we’ve seen before, when reforms shake up existing incentive systems but don’t take those structures into account, they often face pushback or get watered down. People may find ways to sidestep the new rules altogether, which can frustrate the whole process.
In the end, we often see a cycle of ongoing underdevelopment. While there may be advancements in specific areas, these improvements rarely lead to lasting and meaningful change across the broader system.
The fallout from this misalignment can be quite serious. When development efforts are fragmented, it feels like we’re tackling projects in isolation instead of weaving them into a unified strategy. This lack of coherence tends to blur accountability, as everyone shares the responsibility but no one takes clear ownership. As a result, we often find ourselves focusing on short-term wins instead of looking long-term, where sustainability really matters. Reforms face an uphill battle, too; they tend to disrupt existing systems without addressing the underlying issues that created those systems in the first place. This leads to a frustrating cycle where we make some progress, but it rarely sticks. It’s like we’re constantly taking two steps forward and one step back, instead of building a solid foundation for lasting change.
For Malawi 2063 to truly thrive, we must tackle these fundamental challenges head-on. This calls for a shift from just gathering resources and creating policies to a more thoughtful approach to system design. We need to create systems that align incentives with our long-term development goals.
To effectively drive the transformation agenda, we need to ensure that political incentives align with our long-term goals. It’s important to clarify that this doesn’t mean we should eliminate politics from the development process; rather, we should find ways to leverage it to our advantage. For instance, when we invest in crucial areas such as industrialisation, agricultural diversification, and infrastructure, we should make these efforts visible and relatable to political figures. By translating the milestones of Malawi 2063 into clear, tangible achievements, we can create moments that politicians want to be associated with. This approach can help shift electoral incentives, encouraging political leaders to support structural transformation rather than hinder it.
It’s important to ensure that how we allocate resources is more effective by strengthening our institutional processes. For instance, rather than letting programs like the Constituency Development Fund operate separately, we should integrate them into our district development planning. This alignment with the goals set out in Malawi 2063 ensures that the money spent at the local level supports our national transformation objectives rather than creating divisions or confusion. By working together within a unified framework, we can make a greater impact on our society’s progress.
To truly make accountability systems effective, we need to deepen our commitment. Malawi 2063 emphasises the importance of results and performance, but that means we need to clearly assign responsibilities and establish mechanisms to ensure they’re followed. It’s essential that our audit systems, parliamentary oversight, and public transparency evolve from being mere formalities. They should actively influence behaviour and drive positive change in our society.
To foster real change, we need to rethink how we motivate our civil servants. They should feel empowered and safe to explore creative solutions, especially in key areas such as agriculture, tourism, and manufacturing, which are vital to the success of Malawi 2063. If we don’t make these adjustments, we risk falling short on the ambitious policies we’ve set for ourselves. Supporting our public servants in this way will help bridge the gap between our goals and the actual progress we make.
It’s important that economic incentives focus on productive investments. When governments make decisions about spending and procurement, they should prioritise sectors that help drive real change in the economy. This means supporting areas that promote value addition, industrialisation, and export growth, rather than falling into the trap of mindless consumption or catering to political interests. It’s all about fostering a more sustainable and transformative economic landscape. There seem to be instances of state capture or cartels operating in different sectors of the economy. This must be nipped in the bud.
Finally, development partner engagement must be aligned with Malawi 2063 as a system, not just as a framework. This requires shifting from fragmented, project-based interventions toward coordinated support for institutional and system-wide performance.
These changes are definitely challenging. They ask us to face deep-rooted interests, rethink who holds power, and reconsider our approach to development. However, without taking these steps, the goals set out in Malawi 2063 might remain dreams rather than become real achievements. The real issue facing Malawi isn’t just about limited resources; it’s about ensuring that the motivations driving our decisions align with our long-term ambitions. To see real improvements, we need to change the incentives that guide our choices. Malawi 2063 gives us a clear vision of where we want to go, but whether we can actually get there hinges on how well our decision-making processes are crafted to support that journey.
Toward an incentive-based understanding of development
Understanding the importance of incentives means we need to change how we view and address development challenges. Instead of seeing them as just problems to be fixed, we should consider what motivates people and communities. By doing this, we can create more effective solutions that truly resonate with those we’re trying to help.
Instead of focusing only on how to gather resources, we should also consider how those resources are managed. This means we need to ask some different questions: What motivates the decisions about where money and resources go? How do the rules and frameworks in place affect people’s actions? Who actually gains from the current systems, and who ends up paying the price?
Tackling these challenges goes beyond simply finding more funding; it’s about grappling with deeper issues like power dynamics, accountability, and the need for institutional reform. We also need a better grasp of what’s politically possible and the limitations that different players face.
Changing incentives is not easy. It means we need to strengthen how we hold people accountable, improve transparency, and ensure that long-term investments aren’t overlooked under short-term political pressure. Additionally, donor support should better align with local priorities and the existing institutional landscape.
If this diagnosis is correct, then the solution requires a fundamental shift in approach. Development cannot be driven solely by increasing resources or improving policy design. It must be grounded in a deeper understanding of how incentives shape behaviour. The task is not to eliminate incentives; this is neither possible nor desirable, but to align them.
This means designing systems that reinforce, rather than undermine, long-term development objectives. It means making long-term investments visible and politically rewarding. It requires embedding institutional processes into resource allocation, ensuring that decisions follow structured planning frameworks rather than discretionary control. It demands accountability systems that are not only formal but also enforceable and transparent. It also requires creating space for bureaucratic innovation by reducing the risks associated with deviation from established procedures.
In practical terms, this approach can be illustrated by redesigning systems such as the CDF. Rather than framing the debate around who should control the fund, Members of Parliament or councillors, the more relevant question is how the system can be structured so that all actors, regardless of their position, are incentivised to make decisions that support coherent and sustainable development outcomes. This could involve maintaining political visibility for elected officials while ensuring that project selection aligns with district development plans, strengthening procurement transparency, and enabling community-level monitoring.
Ultimately, this perspective leads to a different understanding of development itself. Rather than viewing it as a function of resource availability, it becomes a function of how resources, incentives, and institutions interact. A more accurate formulation would be:
Development Outcomes = Resources × Incentives × Institutions
This formulation explains why increases in funding do not automatically translate into better outcomes, and why technically sound policies often fail to deliver results.
Malawi’s development future will therefore not be determined solely by how much it can mobilise in terms of resources. It will be determined by how effectively it can design systems that align the incentives of political leaders, bureaucrats, economic actors, and citizens with long-term development goals.
Conclusion: A different lens on development
Malawi faces a range of development challenges that aren’t solely about having enough resources. While resources are crucial, they are just part of the picture. At the heart of the issue is how these resources are allocated and utilised, which is heavily influenced by the incentives that drive behaviour across political, bureaucratic, and economic systems.
If we don’t tackle these deeper dynamics, simply pouring more resources into the situation is unlikely to bring about the changes we want to see. So, development isn’t just about the quantity of resources available; it’s also about the choices we make, the structures we create, and the incentives that guide our actions.
Closing Reflection
Ultimately, development isn’t just about the resources or wealth a country has. It’s really about how choices are made regarding those resources and the reasoning behind them. The decision-making process plays a crucial role in shaping a nation’s progress and future. That is where the real challenge lies. And that is where meaningful transformation must begin.
Malawi has plenty of vision and ambitious plans for its future. What it really needs to tackle now is something deeper: Are the incentives in place truly supporting the kind of future we want to create? Ultimately, development isn’t only about having big dreams; it’s also about making sure all the pieces fit together in a way that drives progress.
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