Title : Does access to loans by small-scale fishers result into profitability and economic empowerment: Evidence from Likoma Island fishing communities in Lake Malawi
Abstract:
Sustainable economic growth is a major pillar under Blue Economy despite that many artisanal fishers are not economic sustainable due to lack of capital to boost their fishing operations. Therefore, a study was conducted to assess impact of loan access on profitability and economic empowerment among small-scale fishers in Likoma Island in Lake Malawi from January to December 2022. A total of 366 respondents were interviewed in the study area. The majority (75%) of the respondents showed that it was difficult to obtain loans from formal institutions but instead from informal money lenders such as friends because fishing involves expenditures that were not easily met from personal savings and other personal sources of income. Whereas access to bank loan is largely determined by the value of assets invested in fishing activities, gender and education of the small-scale fishers. This study, therefore, suggests a valid loan selection criterion that should include value of assets invested in fishing activities to influence loan accessibility by small-scale fishers. The study also revealed that access to credit, provision of financial literacy, and access to market influence economic empowerment of small-scale fishers. Furthermore, artisanal fishing was found to be profitable in Likoma, despite the nonavailability of formal loan schemes. The study concludes that sustainable economic growth can be achieved by leveling the playing ground through instituting policy instruments that allows easy access of formal loans by small scale fishers. These policy instruments should take on board the health of the stock among other parameters.
