Announcement of Five Million Dollars Credit to Dominican Republic for Livestock Development on April 29, 1971

• INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET, N.W., WASHINGTON 0. C 20433 TELEPHONE: EXECUTIVE 3-6360 IDA Press Release No. 71/15 Subject: $5.0 million credit to April 29, 19 71 Dominican Republic for livestock development The International Development Association (IDA), of the World Bank Group, has granted a $5.0 million credit to the Dominican Republic to help increase beef and milk production both to meet rising domestic consumption and for export. The mainstay of the Dominican Republic is agriculture, which now accounts for one-quarter of gross domestic product, IOC>re than one-half • of total employment, and 90% of the,value of commodity exports. country is particularly well suited to the development of livestock. According to the last census in 1960 the cattle population was one The million animals; it is presently estimated at 1.1 million head. Inadequate technology, excessive slaughter in 1965, drought in 1968, and shortages of finance have contributed to this slow growth. The project consists of the development of about 100 beef breeding/ fattening ranches in the eastern region, 120 dairy/beef fattening ranches in the northern region and Cibao, and 40 beef/dairy ranches in the northern region. Paritcipating producers will receive long-term loans and technical assistance with which to introduce pasture improvements, suitable ranch facilities and equipment, and superior herd management techniques • • /mor.e IDA P.R. 71/15 - Dominican Republic - livestock • - 2 - The Government will make proceeds of the IDA credit available to the Central Bank's Economic Development Investment Fund (FIDE). FIDE (Calle Pedro Enrique Urena, Santo !bmingo, D.N., Dominican Republic) will be responsible for implelIW:!nting the project and will rediscount long-term loans made to ranchet~ by participating financial institutions, which incluq.e commercial banks, development finance companies and the Agricul tur~1 Bank. An important aspect of the project is to encourage these institutions to increase their activities in agriculture. Participating banks will maki available, from their own resources, short-term loans to ranchers to purchsg~ steers for fattening on surplus feed available during herd buildup and to cover incremental operating expenses. The Central Bank and participating financial institutions will also provide technical services to ranchers, including advice on ran<:h and herd management, assistance in drawing up far;n plans, and supervising irnplement.>- • tion of development plans. The cost of tthe project, including incremental working capital, is estimated at $9.0 million, of which $2.4 million is foreign exchange. The IDA credit will finance 55% of total project costs, the Central Bank 15%, participating credit institutions 13%, and the ranchers 17%. The IDA credit is for a term of 50 years, with a 10-year grace period. It is interest free but carries a 3/4 of 1% service charge to meet IDA's administrative expenses. The Central Bank expects to accrue surplus funds from repayments of subloans not required for servicing its loan from the Government. Yill b~ ~ad for further lending for agriculture. - 0 - These •