Turkey - Fruit and Vegetable Export Project

RESTRICTED Report No. P-948 This report is for official use only by the Bank Group and specifically authorized organizations or persons. It may not be published, quoted or cited without Bank Group authorization. The Bank Group does not accept responsibility for the accuracy or completeness of the report. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN AND DEVELOPMENT CREDIT TO THE REPUBLIC OF TURKEY FOR A FRUIT AND VEGETABLE EXPORT PROJECT May 26, 1971  INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMETT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN AND DEVELOPMENT CREDIT TO THE REPUBLIC OF TURKEY FOR A FRUIT AND VEGETABLE EXPORT PROJECT 1. I submit the following report and recommendation on a proposed loan in an amount in various currencies equivalent to US $10 million and a pro- posed credit in an amount in various currencies equivalent to US $15 million to the Republic of Turkey for a fruit and vegetable export project. PART I - HISTORICAL 2. In February 1970, the Turkish Government requested Bank Group assis- tance in financing this project, which forms part of Turkey's export develop- ment program. The proposed loan and credit, totalling $25 million, would be the first lending for Turkish fruit and vegetable export development. The project was appraised in October/November 1970. Negotiations with representa- tives of the Government and the Agricultural Bank of the Turkish Republic (ABT), took place in Washington during April 22 - 30, 1971. The Government delegation was headed by Mr. Ahmet Tufan Gul, Chief Counselor for Economic and Financial Affairs of the Turkish Embassy, and included Mr. Mutlu, Division Chief of the State Planning Organization, Mr. Oktar, Research Director of the Ministry of Agriculture, Mr. Karol, Deputy Director General of the Mlinistry of Village Affairs, and Mr. Koprululer, Financial Counselor of the Embassy. The ABT was represented by its Secretary General, Mr. Parman. 3. The following is a summary statement of Bank loans and IDA credits to Turkey as at April 30, 1971: Amount (US $ million) Bank IDA Undisbursed Total (less cancellations) 184.2 96.8 84.1 of which has been repaid to Bank and others 46.9 Total now outstanding 137.3 Amount sold 1.2 of which has been repaid .7 .5 Total now held by Bank and IDA 136.8 96.8 Total undisbursed 76.0 8.1 84.1  4. For the status of individual loans and credits and comments on the execu- tion of the projects, as well as for the other operations under consideration and IFC's activities in Turkey, reference is made to the President's Report on an edu- cation project, dated May 7, 1971 (No. P-930). PART II - DESCRIPTION OF THE PROPOSED LOAN AND CREDIT 5. LOAN CREDIT Borrower: The Republic of Turkey The Republic of Turkey Amount: US $10 million equivalent in US $15 million equivalent in various currencies various currencies Purpose: $23.8 million to assist in financing through ABT the purchase by sub-borrowers of ferry ships, refrigerated trailers, export handling facilities, and the execution of on-farm development. $1.2 million to cover the foreign exchange cost of technical assistance, consultant services, agricultural credit survey, research and citrus propagation farm. Amortization: In 20 years including a 5-year In 50 years including a 10-year period of grace, through semi- period of grace,through semi- annual installments beginning annual installments of 1/2 of October 1, 1976 and ending 1 percent from Cctober 1, 1981 April 1, 1991. through April 1, 1991, and of 1-1/2 percent from October 1, 1991 through April 1, 2021. Interest Rate: 7-