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How traceability is restructuring Malawi’s tobacco industry

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  • Moyer-Lee, Jason
  • Prowse, Martin

Abstract

This article applies a global value chain framework to tobacco in Malawi. It illuminates how cigarette manufacturers govern the chain and control first-tier suppliers: the leaf merchants. Due to credence and litigation concerns, manufacturers have become obsessed with leaf integrity. Contract farming offers merchants the ability to meet manufacturers’ compliance and traceability requirements. It also offers an opportunity for process and product upgrading by smallholders, but threatens to exclude poorer growers. The article concludes by outlining current contractual practices and the possible role of third parties in this rapid institutional evolution.

Suggested Citation

  • Moyer-Lee, Jason & Prowse, Martin, 2012. "How traceability is restructuring Malawi’s tobacco industry," IOB Working Papers 2012.05, Universiteit Antwerpen, Institute of Development Policy (IOB).
    • Handle: RePEc:iob:wpaper:2012005
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    References listed on IDEAS

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    1. Klein, Benjamin, 1996. "Why Hold-Ups Occur: The Self-Enforcing Range of Contractual Relationships," Economic Inquiry, Western Economic Association International, vol. 34(3), pages 444-463, July.
    2. Kydd, Jonathan & Christiansen, Robert, 1982. "Structural change in Malawi since independence: Consequences of a development strategy based on large-scale agriculture," World Development, Elsevier, vol. 10(5), pages 355-375, May.
    3. Giuliani, Elisa & Pietrobelli, Carlo & Rabellotti, Roberta, 2005. "Upgrading in Global Value Chains: Lessons from Latin American Clusters," World Development, Elsevier, vol. 33(4), pages 549-573, April.
    4. Reardon, Thomas & Codron, Jean-Marie & Busch, Lawrence & Bingen, R. James & Harris, Craig, 1999. "Global Change In Agrifood Grades And Standards: Agribusiness Strategic Responses In Developing Countries," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 2(3-4), pages 1-15.
    5. Gibbon, Peter, 2001. "Upgrading Primary Production: A Global Commodity Chain Approach," World Development, Elsevier, vol. 29(2), pages 345-363, February.
    6. Prowse, Martin, 2011. "A century of growth? A history of tobacco production and marketing in Malawi 1890-2005," IOB Working Papers 2011.10, Universiteit Antwerpen, Institute of Development Policy (IOB).
    7. Mighell, Ronald L. & Jones, Lawrence A., 1963. "Vertical Coordination in Agriculture," Agricultural Economic Reports 307164, United States Department of Agriculture, Economic Research Service.
    8. John Humphrey & Hubert Schmitz, 2002. "How does insertion in global value chains affect upgrading in industrial clusters?," Regional Studies, Taylor & Francis Journals, vol. 36(9), pages 1017-1027.
    9. Gow, Hamish R. & Streeter, Deborah H. & Swinnen, Johan F. M., 2000. "How private contract enforcement mechanisms can succeed where public institutions fail: the case of Juhocukor a.s," Agricultural Economics, Blackwell, vol. 23(3), pages 253-265, September.
    10. repec:bla:devpol:v:21:y:2003:i:5-6:p:615-625 is not listed on IDEAS
    11. Gereffi, Gary, 1999. "International trade and industrial upgrading in the apparel commodity chain," Journal of International Economics, Elsevier, vol. 48(1), pages 37-70, June.
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    Cited by:

    1. Pipkin, Seth & Fuentes, Alberto, 2017. "Spurred to Upgrade: A Review of Triggers and Consequences of Industrial Upgrading in the Global Value Chain Literature," World Development, Elsevier, vol. 98(C), pages 536-554.
    2. Marianne Nylandsted Larsen, 2016. "Sustaining Upgrading in Agricultural Value Chains? State-Led Value Chain Interventions and Emerging Bifurcation of the South Indian Smallholder Tea Sector," Sustainability, MDPI, vol. 8(11), pages 1-19, October.

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    Keywords

    Malawi; Global value chains;

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