Costa Rica - Education Project

FILE COPY DOCUMENT OF INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION Not For Public Use Report No. 129a-CR APPRAISAL OF AN EDUCATION PROJECT IN COSTA RICA May 29, 1973 Education Projects Division Latin America and Caribbean Regional Office This report was prepared for official use only by the Bank Group. It may not be published, quoted or cited without Bank Group authorization.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.  CURRENC! EQUIVALENTS Currency Unit = Colones (D) US$1 = Official: 96.65 US$1 = Free : 9B.60 g = Official: US$0.15 - = Free : US$0.12 kEIGHTS AND 1tASURES k 2.20 pounds 1 m 10.76 sq ft. 1 km2 = 0.38 sq mi 1 ha = 2.47 acres FISCAL YEAR January 1 - December 31  * ABBREVIATIONS CACM = Central American Common Market ICAP G Central American Institute of Public Achinistration INA = National Institute of Apprenticeship MOE = Ministry of Education UCR = University of Costa Rica   APPRAISAL OF AN EDUCATION PROJECT IN COSTA RICA TABLE OF CONTENTS Page No. BASIC DATA SUMMARY ANDCONCLUSIONS..................... 1 I. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . 1 II. THE SETTING . . . . . . . . . . . . . . . . . . . . . . . 2 Social and Economic Background. .9 ... . ..... 2 Economic Development .................... 2 Manpower Requirements ................... 3 The Education and Training System . . . . . . . . . . . . . 4 Education Development ................... 6 Education Finance 7................ 7 IIT. THE PROJECT . . . . . . . . . . . . . . . . . . . . . . . . 9 Lower Secondary Rural Schools . .. . . . . . .a . . ... 9 Industrial Arts and Home Science Workshops, and Science Laboratories . .. .. .. . .. .... . 10 Vocational Training Centers ............... . 11 Technical Assistance . . . . . . . . . . . . . . . . . . . . 12 Cost of the Project . . . ...... ...... 13 Financing . . . . . . . . . . . . . . . . . . . . . . . 1. 5 Implementation and Disbursements . . . . . . . . . . . . . . 15 TV. AGREENENTS REACHED AND RECOMMENDATION*-.. * . * . * . * * 17 APPENDICES ANNEXES CHARTS MAP This report is based on the findings of an appraisal mission which visited Costa Rica during September/October 1972. The mission consisted of Messrs. C. Vidalon (agricultural educator), J. Besa (architect), K. Lee (economist), A. French (technical educator - consultant), and N. Fisher (general educator - consultant).  -2- APPENDICES I. Education and Training II. Education Finance ANNEXES Comparative Education Indicators 1. Production, Employment and Productivity; 1950-1980 2. Employment by Industry, Occupation and Education Background; 1950-1980 3. Enrollments, Output and Teachers, by Level and Type of Education; 1971 4. Enrollment by Level of Education and Age Group; 1967-1980 5. School Age Population and Enrollments by Age Group; 1967-1980 6. Enrollments and Repeaters in Primary Schools; 1960-1969 7. Supply and Demand of Primary and Secondary Teachers; 1971-1980 8. Educational Expenditures by Source of Finance; 1967-1980 9. Public Education Expenditures by Level of School and by Type of Expenditure; 1967-1980 10. Recurrent Cost per Student by Level and Type of Education; 1967-1971 11. Revenues and Expenditures of INA; 1965-1972 12. Major External Assistance for Education; 1968-1975 13. Project Content 14. Lower Secondary Schools to be Provided with Industrial Arts and Home Science Workshops 15. Summary of Estimated Costs 16. Contingency Allowances 17. Estimated Disbursement Schedule 18. Capital Cost per Student Place CHARTS 1. Organization of the Ministry of Education (1972-1973) 2. Former and New (1971) Structure of the Formal System of Education 3. Enrollment and Population Pyramid (1970) 4. Implementation Schedule MAP  COSTA RICA BASIC DATA - 1971 POPULATION 1.8 miUion - Urban 0.7 million - Rural 1.1 million Population Growth Rate, 1967-1971 3% p.a. Real GDP Growth Rate, 1961-1970 6.8% p.a. Student Enrollment in: - Primary Education 357,100 as % of age group 7-12 84 (108!!) - Secondary Education 86,000 as % of age group 13-18 26 (34)J) - Higher Education 18,200 as % of age group 19-24 10 Public Education Excpenditures as % of total government expenditures 27.7 as % of GDP 5.2 1/ Including students above and below the relevant age group.   APPRAISAL OF AN EDUCATION PROJECT IN COSTA RICA SUMMARY AND CONCLUSIONS i. The proposed project is designed to assist the Government of Costa Rica to implement its educational development plan by: (a) improving the quality of lower secondary education, especially in science and prevocational subjects; and (b) expanding non-formal vocational training. ii. Costa Rica has traditionally devoted a large share of its resources to education, with particular emphasis on quantitative expansion. However, this expansion took place without any coordinated planning and as a consequence the education system has developed in a rather haphazard way. The National Plan for Educational Development (1972-1980) is designed to reverse this process by improving the internal efficiency of the education system and relating education more closely to the socio-economic requirements of the country. The Plan is well-conceived and provides the framework for an education system which will go far towards meeting these goals over the next decade or so. Its implementation, however, is at an early stage and there is need for support by external financial and technical assistance. The Government is already receiving some such assistance, but there are important areas not so covered, which would be included in the proposed Bank project. iii. The Bank project is designed to improve the quality of lower secondary education by providing laboratories and workshops to existing schools which, due to enrollment pressures, were constructed with classrooms only; expand and regionalize non-formal vocational programs for upgrading the apprenticeship training of workers; and to help to redress imbalances in educational opportunities and promote rural development by expanding lower secondary educational facilities in rural areas. Specifically, the project would comprise: (a) Construction of and furniture and equipment for: - four new and two existing lower secondary rural schools; - industrial arts and home science workshops and science laboratories for twenty-five lower secondary schools; and - five new vocational training centers. (b) Technical assistance: - six man-years of specialists' services for agricultural and home science education; and - twenty-four man-years of fellowships for teaching staff development in agriculture and home science subjects.  - ii - iv. A project unit would be established within the Ministry of Public Works and Transport to supervise project implementation, coordinate activities within the Government and with the National Institute of Apprenticeship (INA) and provide liaison with the Bank. v. Contracts for civil works, furniture and equipment would be awarded on the basis of international competitive bidding, in accordance with the Bank's Guidelines for Procurement. In accordance with the Central American Agreement on Fiscal Incentives for Industrial Development, manufacturers in Central American Common Market Countries would receive a regional preference of 15% of the c.i.f. cost of imports or 50% of the applicable external tariff, whichever is lower. vi. The total cost of the proposed project is estimated at US$9.4 million, and the foreign exchange component at US$4.7 million. Implementation would be over a period of 4.5 years; construction would be completed in about 3.5 years. A proposed Bank loan of US$6.2 million would finance 66% of total cost. Since it would have a minimum impact on recurrent expenditures, the project size would be within the capacity of the Government to execute and finance. vii. The proposed project is suitable for a Bank loan of US$6.2 million to Costa Rica for a term of 30 years, including a grace period of 10 years.  APPRAISAL OF AN EDUCATION PROJECT IN COSTA RICA I. INTRODUCTION 1.01 Following a request from the Government for Bank assistance to the education sector, a Unesco mission visited Costa Rica in October 1971 to identify priority items for a possible education project. Its report of January 1972 served as a basis for discussions between the Government and a Bank mission which visited Costa Rica in April 1972. The Government subsequently prepared the project with assistance from UTnesco and in June 1972 submitted its loan request to the Bank. The proposed project was appraised in Septem- ber/October 1972 by a mission comprising Messrs. C. Vidalon (agricultural educator), J. Besa (architect), K. Lee (economist), A. French (technical educator-consultant) and N. Fisher (general educator-consultant). 1.02 During appraisal the proposed project was modified to: (a) delete low priority and insufficiently prepared items: (b) adopt more economical alternatives for certain proposals; and (c) keep the size of the project within financially manageable limits. The project content was discussed again with the Government in Februarv 1973 when Mr. Vidalon visited San Jose. The project wo',ld consist of: (i) construction of and furniture and equipment for: - four new and two existing lower secondary 1/ rural schools; - industrial arts and home science workshops, and science laboratories in twqenty-five existing lower secondary schools; and - five new vocational training centers. (ii) six man-years of soecialists' services and twenty-four man-years of fellowships for training abroad. The total cost of the project is estimated at US$9.4 million and the foreign exchange component at US$4.7 million. The proposed Bank loan would be for US86.2 million. 1/ Grades 7-9 make up the "third-cycle" of basic education in Costa Rica, but the more common term "lower secondary" is used throughout this report.  -2- II. THE SETTING Social and Economic Background 2.01 Costa Rica maintained one of the world's highest population growth rates during the late 1950's and early 1960's (4% p,a.), but, following the introduction of a national family planning program, a sharp decrease in birth rates in the past ten years has lowered population growth to about 3% p.a. Almost half the population is under 15 years and about 40% is classi- fied as urban. More than half of the population live in the Central Plateau (MIeseta Central) which includes San Jose, the capital and the social, cultural, business and political center of the country. One-third of the population is concentrated in the Greater San Jose Metropolitan Area. 2.02 The labor force (32% of population) increased at about 4.3% p.a. during 1963-1968, but it is expected that this rate will slow to 3.8% p.a. in the 1970's (Annex 1). About 43% of the labor force is employed in the primary sectors; 19% in industry and the balance in services. Unemployment is abo-ut 5% - 6% of the labor force. 2,.03 In 1970, the average income was US$560 and the distribution of incone is relatively even compared with many other countries in the region. The illiteracy rate is about 11% and the education system, in quantitative terms. is one of the best in Latin America. A markedly high degree of social col nion is asnociated with the absence of any hereditary aristocracy or XT>Y(3 class differences and Costa Rica has long.had a democratic form of Gveruiv ent v4th two major political parties. Costa Rica has no mineral wealth except for bauxite. The economy 6epen,~4,s 'eavily on coffee, bananas, cacao and sugar, which account for 23% of C.UP, although the manufacturing sector (19% of GDP) has grown rapidly (at 11`% p.*, in the last five years) and has contributed greatly to the substan- tial Increase in exports. Above all, Costa Rica has achieved an impressive rate of economic growth, an average annual increase of real GDP of 6.8% in the past decade. This rate was largely the result of increased agricultural production, especially bananas and coffee for export, rapid industrialization and important foreign investments encouraged by low wages and political stability. The country, however, has often (1966, 1970 and 1971) experi- enced fiscal and balance of payments difficulties resulting mainly from dependence on a few agricultural commodities subject to strong world market price fluctuations. Economic Development 2.05 Although no formal development plan has been formulated, the gov- ernment's development strategy is aimed mainly at restructuring the economy and diversifying exports. Traditional agricultural exports (bananas and coffee) are expected to level off towards the mid-1970's and the main effort, therefore, will be to develop new exports, particularly in markets outside the Central American Common Market (CACM). The Government has signed a contract with a U.S. firm to investigate new export possibilities and a bill  - 3 - has been submitted to the Assembly to grant incentives to non-traditional exports. 2.06 However, export promotion alone will not be sufficient to ensure expansion of output and employment in agriculture. Agricultural policy will focus increasingly on improving the productivity of small and medium-sized farms producing mainly for the domestic market. 'rhis would make it possible to substitute for food imports which now account for about 5% of total im- ports and to provide raw materials for further industrial processing. 2.07 Although the primary sector would continue to be the mainstay of the economy, the industrial sector is expected to play a key role in sustaining economic growth in the 1970's. While the government will explore further opportunities for developing import-substitution industries, its prime effort will lie in making industrial production less import-dependent by using unexploited domestic resources such as agricultural raw materials, woods and mineral ores. Transportation, public utilities and other related infra- structure will receive priority so as to promote the integration of the economy. Manpower Requirements 2.03 The success of this development strategy requires a competent work force. Although detailed analyses are lacking, the Bank estimates, on the basis of available data and studies by ILO and UCR, that during 1968- 1990, employment may increase at about 3.5% p.a. (Annex 1). This means that about 242,000 new jobs would be created by 1980 -- some 83,000 in agriculture, 53,000 in industry and 106,000 in services (Annex 2). 2.09 In the agricultural sector there would be a heavy demand on trained manpower to diversify agricultural production and increase food production at a faster rate than Dopulation growth. This requires efficient and know- ledgeable agricultural extension and other services staff backed by adequate research staff. By 1930, somewhat more than 800 agricultural professionals and technicians would be needed by government agencies, banking and credit institutions and other emnloyers. USAID-supported programs for the expansion of the Faculty of Agriculture, UCR, and other post-secondary agricultural schools will be aimed at meeting the need for agricultural professionals and technicians. An IDB loan for eight upper secondary agricultural schools will help fill the need for lower level technicians. Vocational training programs are needed to complement these projects and the vocational training centers included in the nroject would be an important sten in this direction. 2.10 The development of new export industries and the expansion of indus- tries for the growing domestic market will call for more skilled workers. The need for technicians and skilled workers is partictularly strong in food processing, textiles, chemicals, woodwork and furniture, building and road construction, auto vehicles and electrical en uipment. Although a new insti- tute of technology will start operating in 1973, no opportunities exist in the present educational system for training technicians below university level. About 160 students who qraduate each year from industrial upper secondary schools are potential skilled workers. Technical education at this  level will be expanded under an IDB project to help meet the need for skilled industrial workers. To meet the estimated need for an additional 20,000 skilled and semi-skilled workers in industry by 1980, both the formal and non-formal educational systems should encourage youths to take vocational training and should provide adequate training facilities. The industrial arts and home science workshops in lower secondary schools and the vocational training centers included in the project would serve this purpose. 2.11 A large part of the rapid increase in the demand for professional manpower occurs in the education sector itself. Extension of compulsory education from grade six to nine, development of diversified upper secondary schools, and expansion of higher education institutions are the main causes of the increasing demand for teachers and administrators. By 1980, the minimum teacher requirements will be 10,600 for primary level, and 6,700 for secondary level of whom 1,200 will be needed for vocational education. Restructuring and development of the teacher training system under the new National University (para. 2.18) is expected to meet these demands. The Education and Training System (Appendix I; Annexes 3-7; Charts 1-3) 2.12 The National Plan for Educational Development (1972-1980), pub- lished in 1971, is the culmination of an intensive study of the achievements and short-comings of education in Costa Rica up to 1970. The main objectives of the Plan relate to: (a) restructuring of the education system into nine years of basic general education followed by three years of diver- sified education with increased options; (b) expansion of educational opportunities with special regard to the rural areas; (c) expansion in the pre-primary and lower secondary levels and in vocational education in the upper secondary level; (d) strengthening of pre-vocational teaching in the lower secondary level; (e) qualitative improvements throughout the national system; and (f) more efficiently structured central administration and de- centralization of educational services. 2.13 The system has suffered from three educational constraints: repetition, dropouts and lack of physical facilities. Since 1972, the structure of primary and secondary education has been in process of change. The former pattern of 6+3+2 or 3 (two years academic or three years voca- tional) has become a nine-years basic education in three 3-year cycles, followed by three years of academic or vocational education. New curricula and teachers' manuals are being prepared, and new criteria for evaluation of students' programs, student guidance and automatic promotion have been  - 5 - established. In-service training courses for teachers, specialists and administrators have already begun. 2.14 Primary education, consisting of six years in two 3-year cycles, starting at age six or seven, is provided free in public schools and is compulsory. Since 1967, primary enrollment has grown some 4% p.a. to reach 357,100 in 1971. This represents 108% of the age group 7-12 years but, if overage and underaged students are excluded, the ratio is 84%. Expansion has not been matched by qualitative improvement, especially in the rural areas where standards are low. Fewer than one-third of the students com- plete primary education without repetition while late starters and repeaters boost enrollments in the first two grades. In 1970 there were 19,000 drop-outs in grades 1-5 and a further 20,000 students who graduated in grade 6 but were unable to continue full-time education. Almost one-half of the total enrollment were girls and private schools accounted for 6% of the enrollment. 2.15 The Plan calls for a gradual decrease in primary education enrollments by the introduction of automatic promotion, while increasing to 97% the actual age-group participation. It appears, however, that -- as has already happened in 1971 -- primary enrollment will continue increasing to near 400,000 by 1980 (Annex 4). Qualitative improvements in the curriculum will include a more integrated subject-related approach with emphasis on exploratory learning techniques and on mathematics, science and practical subjects. While the great majority (86%) of primary school teachers are qualified, these new approaches will involve an expanded in-service training program which the government has already initiated. Together with pre-service training it should eliminate unqualified teachers by 1980 and have a supply exceeding the minimum needs for teachers (Annex 7). Upgrading programs for a number of primary teachers will be organized to qualify them to teach at the lower secondary level. 2.16 Secondary education enrollments rose by 10.5% p.a. during the last four years to reach 86,000 in 1971, equivalent to 26% of the relevant age group. About 50% of primary school leavers enter secondary education and only half of them complete the course. Public education is free and 13% of enrollments were in private schools (1971); 49% were girls. There is an acute shortage of physical facilities in lower secondary schools which in many instances use the facilities of primary schools. Children in rural areas have far from equal educational opportunity; the probability of entrance to secondary school is more than 90% in the city and less than 20% in the rural areas. In 1971, only 26% of the secondary students were in the upper diversified cycle and only 8% were in vocational courses (Annex 3). With only 69% of teachers qualified and inadequate laboratories, workshops and libraries, the quality of secondary education is low. 2.17 The National Plan calls for qualitative and quantitative improve- ments at this level. Lower secondary (grades 7-9) will be improved in content and methodology, emphasizing practical and pre-vocational courses; the provi- sion of guidance courses would offer relevant preparation both for students terminating full time education at this level and for those seeking to  - 6 - proceed with their studies. At the upper diversified cycle (grades 10-12) new options in health, communications and art will be added to the existing academic, agricultural, industrial and commercial courses. Total enrollment would increase to 53% of the relevant age group, which would include a higher proportion of students in vocational courses. It is the Bank's view, however, that population projections have been underestimated and total secondary school enrollment will probably reach 200,000 in 1980, representing only 47% of the relevant age group, of which 17% would be in vocational courses (Annex 4). This means there will have to be a greater expansion in physical facilities and teacher training and correspondingly increased financial provisions (Annex 9), than is planned. Plans for program expansion and geographical distribution of lower secondary and academic upper secondary schools are being prepared by the Ministry of Education. For the expansion and improvement of vocational upper secondary schools an IDB project is under implementation. Some 4,000 additional secondary teachers will be required by 1980. Since the expected output from teacher training institutions is lower, an intensive program of in-service training will be needed to upgrade surplus primary teachers and to re-orient secondary teachers toward the new approaches. 2.18 Higher education enrollments increased at a rate of 20% p.a. since 1967 to reach 18,200 in 1971, or 10% of the relevant age group. Some 15,700 students were enrolled in the University of Costa Rica (UCR), most of them in humanities, social sciences and education, and only 15% in science and tech- nical faculties. About 2,400 students were enrolled in primary and secondary teacher-training institutions and 60 in the new agricultural technical school. All teacher training courses are post-secondary: two years for primary teachers (to be extended to three years) and four years for secondary teachers. In recognition of the need for coordination in the development of teacher training, a new National University has recently been established which will be integrated into the national system of higher education. Integrated into this new autonomous institution are the higher normal school and the four normal schools now operating. Until the governing bodies are legally established, the University will be organized and administered by an ad-hoc commission comprising the Ministers of Education, Planning and Labor, and eight professors of UCR. On the other hand, the need for post-secondary technician institutions and UCR regional centers is well recognized, but the lack of basic studies has delayed the preparation of a comprehensive plan; studies are now being carried out with USAIT and IDB assistance. 2.19 Non-formal training is mainly the responsibility of the Ministry of Education and the National Institute of Apprenticeship (INA). In 1971, enrollments in non-vocational adult evening classes organized by the Ministry totalled 7,300 and INA enrollments in a variety of skill training and up- grading programs reached 6,300 (paras. 3.11 to 3.13). Education Development 2.20 Costa Rica has traditionally devoted a large share of its re- sources to education (28% of Central Government expenditures in 1971), with emphasis on quantitative growth, especially at the primary level. This growth, however, took place without any coordinated plan for educational development and the system has grown in a haphazard way. The National Plan  for Educational Development (1972-1980) is designed to reverse the process by improving the internal efficiency of the system, by lowering the cost of education and, above all, by gearing the system to the needs of the country. To these ends, a number of programs have been formulated, some of which are already being implemented. The well-conceived Plan provides a framework for an education system which will go far to meet the needs of the population and the economy effectively over the next decade or so. In general, the Plan is well adapted to the requirements of the country but it is not yet spelled out in detail, nor are the implications of the general lines of the new policies fully visible with respect, for example, to the role of the University and the organization of teacher-training; the best type of curri- culum for the lower secondary rural schools; the degree of specialization and the rate of expansion of the upper secondary schools; a more realistic assessment of the growth of student enrollment at various levels; and the financing and rate of implementation which can realistically be envisaged for a plan intended to be in full operation by the end of the seventies. Unesco is providing assistance on education planning, curriculum and adminis- tration on a continuing basis. 2.21 Despite the lack of detailed Dlanning, there are certain clear needs which the Bank can help meet. The lines of policv are sufficiently definite for the Bank to proceed with a project to: (a) improve the quality of lower secondary education by adding to existing schools laboratories and workshops, which due to Pressure on school construction to meet enrollment demands have for the most part been omitted; (b) nrovide facilities to rural schools which, besides offering new educational opportunity at the lower secondary level, contribute to rural development programs through non-formal courses and com- munity activities; and (c) extend vocational training of skilled and semi- skilled workers to the provinces. 2.22 To meet other immediate needs in education planning, curriculum development, teaching material, secondary and higher education, agricultural education and apprenticeship training schemes, the Government is receiving technical and financial assistance from a number of external agencies (Annex 12). The Bank regards the volume and nature of the assistance being provided as adequate, except for the items contained in the proposed project (paras. 3.16, 3.17). Education Finance (Appendix II; Annexes 8-12) 2.23 Financial responsibility for education rests primarily with the Central Government, although local authorities (Juntas de Educacion) help by providing sites and labor for school construction. Public education in grades 1-12 is free. Public expenditure on education increased by 14% p.a. during 1967-1971, a rate similar to the growth of total government expendi- ture but higher than the 11% p.a. growth of GDP (Annex 8). As a result, public expenditure on education increased from 4.7% of GDP in 1967 to 5.2% in 1971, while its share in total central government expenditure remained at about 28%, a relatively high figure by Latin American standards (see Comparative Education Indicators). Public education expenditures per capita amounted to $30 in 1971, as compared with a range of $8 to $26 in other Central American and Caribbean countries. This relatively high figure may be  - 8 - explained by such facts as: (i) teachers' salaries comparable with those of the private sector; (ii) better quality of education; and (iii) low defense expenditures which allow use of resources for social objectives. 2.24 One problem of the educational system is that quantitative expansion was not always accompanied by improvement in quality and efficiency. While enrollments were growing less than 6% p.a. during 1967-1971 (Annex 4), Ministry of Education expenditures rose 15% p.a. (Annex 8). Several factors contributed to the inefficiency of the system: (i) relatively low completion rate (65% in primary school and 46% in secondary school); (ii) diseconomies of the small size of schools and (iii) underutilization of teachers because of early retirement, lower teaching loads and relatively low student/teacher ratios in less populated areas. These factors are also responsible for the excessive concentration of resources on salaries and allowances (over 95% of the Ministry of Education recurrent expenditures) and the resultant inadequate allocations for school materials. School maintenance is the responsibility of the Ministry of Public Works and Transport and appears satisfactory. 2.25 While total education expenditures were high, education claimed only 4% of public investment during 1967-1971, as compared with 10-20% in many other developing countries. Practically no investment has been made in secondary vocational education and teacher training during this period, although enrollments have doubled; hence many students are now accommodated in temporary or inadequate facilities. 2.26 According to the National Plan, MOE total expenditures are projected to grow at 10% p.a. in 1971-1980, declining from 24% to 21% of total Government expenditures. However, since recurrent expenditure in 1971 was higher in absolute terms than estimated in the Plan, the Bank believes that recurrent expenditure in 1980 will be higher than the Plan estimate. Total public ex- penditure on education would therefore increase to 5.5% of GDP and the share of MOE in total Government expenditure would remain at the present 24% level. 2.27 Concerning capital expenditures, the Bank projections show that, even with a more intensive utilization of facilities, the increase in enrollment by 1980 would require an investment of around USS90 million 1/, or US$10 million a year, by MOE in order to provide proper facilities, furniture and equipment. Even increasing the budgetary allocations to capital expenditures from US$1.8 million in 1971 to an average of US$3 million in 1971-1980, as the Bank envisages, would cover only the basic classrooms for the expected increase in enrollment. Thus, the Government would require additional external financing if it is to provide more than just classrooms for new students. The Government will therefore want to assess carefully the pace at wihich it implements the education plan it is now elaborating, taking into account likely availability of external resources and the claims of other sectors. 1/ Cost of complete facilities as estimated by appraisal mission.  III. THE PROJECT 3.01 The objectives of the proposed project are to assist the Costa Rican Government to implement its education development strategy by improv- ing the quality of lower secondary education, especially in science and pre- vocational subjects, without significantly increasing recurrent costs, and by expanding and regionalizing non-formal vocational training. The project would finance: t ~~~~~~~~~~~~~~~~~~~~1/ (i) construction of, and furniture and equipment for: - Staff Enrollment Number of Students Housing at Full Institutions Grades Places Units Capacity Lower Secondary Rural Schools - new 4 7-9 1,720 8 1,720 - extensions 2 600 4 860 Workshops/Labs for Lower Secondary Schools - extensions 25 7-9 4,000 - 36,000 Vocational Training Centers - new 5 n.a. 1,730 - 4,700 (ii) technical assistance in the form of six man-years of specialists' services for agricultural education and home science education; and twenty-four man-years of fellowships for teacher staff de- velopment in agriculture and home science subjects. Lower Secondary Rural Schools 3.02 The Government has recently established a rural secondary education program (Programa de Capacitacion Tecnica), to which it has accorded high priority. The program is designed to help redress imbalances in educational opportunities by providing lower secondary schools in rural districts where no secondary schools existed previously in spite of large numbers of primary school graduates. The schools offer programs which are similar to those of other lower secondary institutions, but with a strong pre-vocational content in agriculture or home science relevant to the needs of each area. 3.03 An equally important objective of the program is the fostering of rural development by the provision of facilities for non-formal courses to improve the skills of adult farmers and homemakers and the sponsoring of developmental activities in cooperation with other public and private organizations, which are directed to the particular social and economic needs of the communities. 1/ Additional information in Annexes 13, 14.  - 10 - 3.04 The program has received enthusiastic public support and at the time of appraisal the establishment of eleven such lower secondary schools had been approved by the Government. Each school has a Board of Management, consisting of representatives of the community and each Board is responsible for providing assistance to its school. The nature of the assistance may vary according to the circumstances but could, for instance, include part-time labor for construction or maintenance building materials or lodging for school officials and teachers. In all cases the community must Drovide the land. 3.05 The project would helD to finance the development of six lower secondary rural schools which are currently operating in temporary build- ings provided by their resnective communities and which have very little equinment. Specifically, the project would provide complete facilities for four schools (in Jicaral, Hojancha, Pacayas and Santa Maria) and additional facilities for two schools (in Aguas Zarcas and Buenos Aires) which already have some new classrooms under construction with community support. The capacity of each school would be 430 student places, one-half for an agri- cultural stream (mostly boys) and one-half for a home science stream (mostly girls). Since most of the students would come from the surrounding com- munity no provision has been made for boarding facilities. Two staff housing units would be provided for each school. 3.06 At the end of the third year (grade 9) of secondary education, students who intend to continue their education would transfer to upper secondary diversified schools in the area; those who do not intend or are unable to continue their education would seek jobs. Although the curriculum of the lower secondary schools would not nrovide specialized training for technician positions, it would offer students a better understanding of the rural environment and some basic skills which could be further improved through non-formal training programs. 3.07 The nresent agricultural and home science content of the cur- riculum in the lower secondary rural schools appears somewhat high for this level of education. Nevertheless, it can be regarded as acceptable during the first years of development of the schools when most of the students will be going directly to work. The curriculum should, however, be subject to continuing review and the Bank should discuss this matter with the Government during project implementation. Industrial Arts and Home Science Workshops and Science Laboratories 3.08 One objective of the National Education Plan is to improve the quality of lower secondary education by revising curricula and giving more emphasis to the sciences, industrial arts and home science to help students to develon basic skills in these areas. W4orkshops and laboratories are essential to teach such subjects in a meaningful way. Costa Rican educa- tional authorities recognize this fact and, indeed, a few secondary schools have excellent facilities. However, due to enrollment pressures, most schools have been constructed with classrooms only.  - 11 - 3.09 Given financial limitations, the project would provide for expansion and imDrovement of industrial arts workshops, home science workshops and science laboratories in 25 existing lower secondary schools, sufficient to service about 60% of the students presently enrolled at that level. Fifteen schools with adequate other facilities were tentatively selected during appraisal (Annex 14). The remaining ten schools will be selected by the Ministry of Education and submitted to the Bank. Tt was agreed during negoti- ations that all the schools to be provided with these facilities would be finally approved during project implementation when building designs and equipment lists are submitted to the Bank. 3.10 Each industrial arts and home science workshop would accommodate 40 students at one tire and each science laboratory -- comprising two areas -- would accommodate 80 students. Thus, 4,000 workshop and laboratory places would be provided in the 25 project schools, enough to service a total enrollment of 36,000 students. The Government agreed during negotia- tions to implement by January 1, 1975, an in-service training program to upgrade the science and practical subjects teachers for these laboratories and work- shops. The program will be submitted to the Bank for comment within one year of the Loan Agreement. Vocational Training Centers 3.11 Costa Rica urgently needs trained manpower (paras. 2.05-2.10). Training for snecific occupations is the responsibility of the National Institute of Apprenticeship (INA) established in 1965. This institute operates outside the formal education system ag an autonomous body with- in the Ministry of Labor and is financed by a payroll tax on industrial and commercial enterprises. It enrolls out-of-school youth and adults in seven different types of courses including three-year apprenticeship courses, short courses to improve the skills of employed workers, foreman training, basic education for those who left school in the early grades and extension courses for women to improve home living competence. INA re- quires the equivalent of primary school education and a minimum age of 15 for apprenticeship courses. Courses are offered both in the training center at La Uruca, near San Jose, and at other locations depending upon the type of course. The achievements of INA are impressive and its relations with industry are aood. To date, more than 10,000 people have benefited from courses offered by INA. It receives technical assistance from ILO, France and Switzerland, except for the agricultural programs of the new regional centers (para. 3.16). 3.12 There is a need for decentralization of INA services through estab- lishment of regional centers. To Provide training of skilled and semi- skilled workers throughout the country the project would establish four new INA regional centers at Naranjo, Limon, Liberia and San Isidro -- all growing districts with populations varying from 87,000 to 200,000. These centers have been well located to serve most people and to have maximum impact on future development: they would correct the existing geographic  - 12 - imbalance of training opportunities, thereby contributing to the implementa- tion of the Government's strategy to provide training opportunities to the provinces. Since all four centers, with a total capacity of 960 places, would offer courses of a flexible nature, they could enroll 3,200 trainees at any one time and could provide 10,000 workers per year with varied forms of training. 3.13 Surveys conducted by INA show a great need for manpower training, particularly for upgrading employed workers. Because employment in the regions to be served is predominantly in agriculture, much of the training (adequately coordinated with the Ministry of Agriculture) would be in agriculture and related occupations. The employment pattern would change as the regions develop and the training would be modified to meet changing needs. Initially, training of an introductory nature and upgrading programs would be made available in the regional centers, while the more formal apprentice training would be concentrated in the existing center at La Uruca. As the need grows, apprentice training would be decentralized and the regional centers would include the entire range of programs. 3.14 Regional advisory bodies with membership including employers, employees and Government are considered essential for generating both regional and sectorial support. The establishment of an advisory body, appointed by INA's central board, in each of the four INA regional centers, within one year of the Loan Agreement, has been agreed. 3.15 The project would also provide a new building in San Jose, plus furniture and equinment, to house INA headquarters. Classrooms and workshops, with a total capacity of 770 student places, for commerce and service courses and in-nlant training., would be included in the main building. Due to the flexible nature of the courses, some 1,500 trainees could be enrolled at any one tine which would produce about 4,500 trained personnel per year. The establishment of the new INA headquarters would allow INA to maintain its present facilities in La Uruca, near San Jose, as a pilot center for all training purPoses and for programming activities, the latter occupying the facilities to be vacated by the administration when it moves to San Jose. Technical Assistance 3.16 Professional services would be provided to: (i) improve existing agricilture and home science courses in lower secondary schools; (ii) improve teaching methods for agriculture and home science subjects in teacher training institutions; and (iii) advise on agriculture training at INA's regional vocational training centers. A total of six man-years of professional services would be included in the project for specialists in agricultural education, home science education and vocational training in agriculture, with two man-years in each field. Two experts would be provided for MOE and one for INA. Job specifications have been agreed during negotia- tions and assurances have been obtained from the Government that the special- ists would be anpointed under terms and conditions acceptable to the Bank as soon as possible and no later than one year from the date of the Loan Agreement.  - 13 - 3.17 Staff development is essential for the success of agriculture and home science programs in the Droject schools. The proposed project would provide twenty-four man-vears of fellowships for: (i) school principals to be trained in modern methods of rural school organization and management; and (ii) agricultural and home science teachers to be trained in their respective fields. It was agreed during negotiations that before fellowships are awarded, the Bank will be consulted on the fellowships program which will be prepared by the Ministry of Education, within six months of the Loan Agreement. Cost of the Project 3.18 The estimated cost and foreign exchange component of the various project items are shown in Annex 15, and summarized below: Colones (millions) US$(millions) % of Local Foreign Total Local Foreign Total Total 1. Lower Sec. Rural Schools 8.08 6.63 14.71 1.21 1.00 2.21 24 2. Vocational Training Centers 6.36 6.44 12.80 0.95 n.97 1.92 20 3. Workshops and Labs. 9.34 10.49 19.83 1.40 1.58 2.98 31 4. Technical Assist- ance 0.29 1.91 2.20 0.05 0.28 0.33 4 5. Project Administration 1.33 - 1.33 0.20 - 0.20 2 6. Contingencies a) Phvsical 2.27 1.83 4.10 0.34 0.28 0.62 7 b) Price 3.61 3.83 7.44 0.55 0.57 1.12 12 Total Project Cost 31.28 31.13 62.41 4.70 4.68 9.38 100 J.1 i 'Lne distribution of costs by category of expenditure is as 0 ows:  - 14 - Colones (millions) US$(millions) % of Local Foreign Total Local Foreign Total Total 1. Construction Academic & Communal Facilities 17.33 11.55 2R.88 2.60 1.74 4.34 46 Staff Housing 0.56 0.37 0.93 0.0S 0.06 0.14 2 Site Development 2.16 0.93 3.09 0.32 0.14 0.46 5 Professional Services 1.48 0.37 1.85 0.22 0.06 0.28 3 Sub-Total 21.53 13.22 34.75 3.22 2.00 5.22 56 2. Furniture 1.24 1.24 2.48 0.19 0.18 0.37 4 3. Equinment 1.01 9.10 10.11 0.15 1.37 1.52 16 4. Tecinical Assistance 0.29 1.91 2.20 0.05 0.28 0.33 3 5. Project Administration 1.33 - 1.33 0.20 - 0.20 2 6. Contingencies 5.88 5.66 11.54 0.89 0.85 1.74 19 Total Project Cost 31.28 31.13 62.41 4.70 4.68 9.38 100 3.20 Construction cost estimates for school buildings are based on contracts concluded bv the National Building Office (Ministry of Public Works and Transnort) over the past three years and on information obtained from private enterprises. The average estimated construction cost per square meter of gross floor area for the rural schools and workshops is US$90 eq,uivalent (October 1072 prices). This cost and the estimated cost ner student nlace in Droiect institutions are reasonable and compare well with other Bank-financed proiects (Annex 18). Site development costs are estimated at 10-12% of buildin, costs, depending on site conditions. Furniture and equi?iment cost estimates are reasonable; detailed lists should be prepared during the design stage and reviewed bv the Bank before Procurement. The Government and INMA would provide the sites Twithout cost to the Droject. Most have already been selected and no difficulty is foreseen in acquiring the remainder (para. 3.28). 3.21 Contingency allowances are shown in detail in Annex 16. For unforeseen factors, 10% has been allowed in the cost estimates of construction, site develonnent and professional services, and 5% in the estimates for furniture and equinnent. Costs are expected to increase, and an additional contingency equal to 15% for local and foreign costs (based on 6% p.a.), has been included. All continoencies amount to 19% of total project cost, or to 23% of project cost before contingencies.  - 15 - 3.22 The foreign exchange component of US$4.7 million equivalent has been calculated as follows: site development, 30%; construction, 40%; furniture, 50%; equipment, 90%; professional services, 20%; specialists' services, 80%; and fellowships, 100%. 3.23 Recurrent costs generated bv the project will not unduly burden the Central Government budget because: (i) INA will cover its own costs from payroll tax (Annex 11); (ii) workshops and laboratories will not require new teachers but only additional expenditures for materials and maintenance; and (iii) while the six rural schools will require some additional teachers, the small additional expenditures are well-justified on grounds of their role in rmral develoDment. Financing 3.24 The proposed project would be financed through a US$6.2 million Bank loan and a counterpart contribution of US$3.2 million, including US$0.8 million from INA and US$2.4 million from the Central Government. Given the priority which the Government accords to education and to the proposed project, it should be able to provide this sum over the next four years during which time its funds available for education investment are likely to total US$10-12 million. INA's revenues are expected to double from 1970 to 1980, from 14.0 to 29.0 million Colones, as a result of the broader base being given to the payroll tax it receives. Increased revenues should allow it to provide 5.5 million Colones over three years for the five new centers which comprise the core of its investment plan; some 3 million n.a. is allocated to investment. 3.25 The proposed Bank loan would finance about 667% of the estimated total cost of the project (US$6.2 million), including US$4.7 million of foreign exchange and US$1.5 million of local expenditures. Implementation and Disbursements 3.26 Administration. A project unit would be established in the Ministry of Public Works and Transport, in which the National Building Office is resnonsible for construction and maintenance of schools. Close coordination with MOE, esnecially on academic matters, planning of space and Preparation of equirtment lists, would he essential, as is in fact the case with the working committee of the 2 ministries which coordinates the school building program. INA also works closely with the Ministrv of Public Works. The project unit would supervise project implementation, coordinate activities with the ministries involved in the project and with INA, and provide liaison with the Bank. To these ends, the project unit would consist of: (i) a full-time project director; (ii) a full-time architect; (iii) a full-time educator seconded bv the MOE; and (iv) a full-time Procurement officer. The director and the architect would be appointed in consultation wjith the Bank. Establishrent of the project unit and anoointment of the project director  - 16 - are conditions of effectiveness of the loan. It was agreed that the other three officers will be appointed within six months after the date of the Loan Agreement. In addition, the project unit will be provided with adequate accounting and supporting staff and facilities. The remunerations and allowances for the project unit director, architect, educator and procure- ment officer are included in the project cost. 3.27 Given the autonomous statuKs of INA, contractual arrangements between the Government and INA concernina the vocational training centers, acceptable to the Bank, will be required. These arrangements are a condition of disburse- ment for the project item concerned. The Government has agreed to require repayment of that part of the loan used for construction of the INA facilities on the same terms as those of the Bank loan. 3.28 Sites. Suitable sites for the six lower secondary rural schools, for 15 industrial arts and home science workshops and for the INA headquar- ters in San Jose and its regional center at Naranjo, are available. Sites for ten further industrial arts and home science workshops and for the TNA regional centers at Liberia, Limon and San Isidro have not yet been selected. Assurances during loan negotiations were obtained from the Government that all legal. steps will be taken for acquisition of sites for the project institutions sn that the sites will be available in due time for building design. 3.29 Procurement. Contracts for civil works, furniture and equipment xmuld be awarded on the basis of international competitive bidding in accordance with Guidelines for Procurement under World Bank Loans. In ac- cordance with the Central American Agreement on Fiscal Incentives for Industrial Development, CACM countries would receive a regional preference of 15% of the c.i.f. price or 50% of the applicable external tariff, whichever is lower. Bid packages would he large enough to encourage international competiton. The project unit would be responsible for preparing and issuing tenders. Detailed master lists of furniture and equipment would be prepared with consultants' assistance and submitted for Bank review prior to procure- ment. 3.30 Design and supervision of civil works would be carried out by the Ministry of Public TWorks and Transport or by consultant architects. Designs would be sumitted for Bank review prior to tendering. An adequate number of qualified architects and building contractors is available in Costa Rica. They would be subject to an appropriate svstem of prequalification prior to bidding. The bulk of contracts would most likely be won by such firms, some of which are joint ventures with foreign partners. 3.31 Disbursements. The project as a whole would be implemented over a period of 4.5 years; the construction part would be completed in about 3.5 years. The proposed loan would be disbursed (Annex 17) as follows:  - 17 - (i) 55% of total expenditures for civil works including related professional services; (ii) 100% of foreign expenditures or 90% of local expenditures for furniture and equipment; (iii) 100% of foreign expenditures for specialists' services and 100% of total expenditures for fellowships; and (iv) 65% of the cost of project unit staff referred to in para. 3.26 above --95% of total expenditures made until December 31, 1974 and 55% from January 1, 1975 to the closing date. Savings in any category would be available to cover cost overruns in other categories. Undisbursed funds would be available for cancellation unless the Bank agrees that they would be used to finance other expenses related to the project. IV. AGREEMENTS REACHED AND RECOMMENDATION 4.01 During loan negotiations, agreement was reached on the following points: (i) preparation of an in-service training program for teachers of science, industrial arts and home science, which will be submitted to the Bank for comment within one year of the Loan Agreement, and implementation of such program as from January 1, 1975 (para. 3.10); (ii) establishment of an advisory body with membership including employers, employees and Government, appointed by INA's central board, in each of the four INA regional centers, within one year of the Loan Agreement (para. 3.14); (iii) appointment of specialists in agricultural education and home science education, under terms and conditions accept- able to the Bank, within one year of the Loan Agreement (para. 3.16); (iv) preparation of a fellowships program by the Ministry of Education, in consultation with the Bank, within six months of the Loan Agreement (para. 3.17); (v) appointment of the architect, educator and procurement officer for the project unit on a full-time basis within six months of the Loan Agreement, the architect being appointed in consultation with the Bank (para. 3.26); and  - 18 - (vi) all legal steps will be taken for acquisition of sites for the project institutions in due time for building design (para. 3.28). 4.02 Conditions of effectiveness of the proposed loan are the estab- lishment of a project unit in the Ministry of Public Works and Transport and the appointment of the project director on a full-time basis, in con- sultation with the Bank (para. 3.26). 4.03 A condition of disbursement for the project item concerning the vocational training centers is a legal agreement between the Government and INA, on terms and conditions satisfactory to the Bank (para. 3.27). 4.04 The proposed project constitutes a suitable basis for a Bank loan of US$6.2 million to Costa Rica for a term of 30 years, including a grace period of 10 years.  APPENDIX I Page 1 COSTA RICA EDUCATION AND TRAINING Introduction 1. The National Plan for Educational Development (1972-1980), published in 1971, was the culmination of an intensive study of the achievements and shortcomings of education in Costa Rica up to 1970. While fully recognizing the significant advances made in primary and to a lesser extent in secondary education, the study identified the following deficiencies: (a) the lack of any coordinated plan for educational development and the haphazard way in which the system had evolved; (b) the ineffectiveness of a highly central- ized administration; (c) inequalities of educational opportunities as between urban and rural communities; (d) inefficiencies in the system occasioned by high rates of dropout and repetition; (e) excessive emphasis on academic subjects within the formal education system; and (f) imbalance between academic and vocational enrollments. 2. The main objectives of the Plan relate therefore to: (a) restruc- turing of the system of primary and secondary education into a nine years basic general education, followed by three years of diversified secondary education with increased options; (b) expansion of educational opportunities with special regard to the rural areas; (c) expansion in the pre-primary and lower secondary levels and in vocational education in the upper second- ary level; (d) strengthening of pre-vocational teaching in the lower second- ary level; (e) qualitative improvements throughout the national system; and (f) more efficient central administration and decentralization of edu- cational services. Administration 3. Responsibility for all public primary and secondary education in- stitutions is vested in the Ministry of Public Education. Private schools in the primary and secondary sectors account for 6% and 13% respectively of total enrollments; they are supervised by the Ministry and required to fol- low the same curricula as public schools. 4. Educational policy is determined by the Higher Council of Education, whose chairman is the Minister of Education. Prior to the publication of the National Plan for Educational Development which inter alia restructures educational administration, the service remained highly centralized with a Vice-Minister, a senior Technical Officer and a number of sectional dir- ectorates advising the Mlinister on all aspects of the service. Regional Directorates, normally responsible for education in their respective areas, exercised purely administrative functions. While in theory school building is the joint responsibility of the Ministry of Education and the Ministry of Public Works and Transport, the latter has in practice taken over this function.  APPENDIX I Page 2 5. The University of Costa Rica is an autonomous institution governed by a University Assembly, a University Council and administered by its Rector. Until the creation of the Technical Agricultural School at Santa Clara in 1970, the Institute of Technology at Cartago in 1971, and the National University in 1973, the University of Costa Rica was the only autonomous educational institution in the country. 6. Non-formal education is provided by the Ministry of Education (adult education and literacy programs); by INA (apprenticeship and upgrad- ing courses); and by the Ministries of Agriculture, Health, Labor, and Culture, Youth and Sport, all of which provide extension and complementary education services. 7. In the field of administration the National Plan for Educational Development sets three objectives: (1) to reform the structure of the Ministry of Education; (2) to decentralize its services, and (3) to co- ordinate the functions of the several Ministries and agencies involved in education. Structure of the Mlinistry of Education (Chart 1) 8. Following consultative meetings with ICAP (Instituto Centro- Americano de Administracion Publica) in 1972, a new structure has been intro- duced for the Ministry of Education, effective from 1973. Its principal features are: (1) executive powers will remain with the Higher Council of Education, advised by the Mfinister; (2) the two principal divisions of the Ministry, technical and administrative, will each be headed by a Vice- Minister (previously one Vice-Minister and a Senior Technical Officer); (3) the Technical Vice Minister will exercise his functions through three General Directorates: Educational Development (qualitative and quantitative planning and course evaluation); Education (all aspects of formal, non-formal and special education at all levels); and Regional Services (coordination of the work of the Regional Directorates); and (4) the Vice-Minister for Administrative Services will operate through Finance, Personnel and General Services departments. The new structure will strengthen the planning aspects of the Ministry (in contradistinction to its hitherto largely administra- tive functions) and will help develop clearly defined links with the newly decentralized regional directorates. Decentralization 9. The concept of a highly centralized education service does not correspond to the intention of the Plan to encourage local initiative and the development of education strategy at the regional level. Accordingly, the Plan replaces the fourteen Regional Administrators by Regional Directors of Education (the change of title is in itself significant) who will assume direct responsibility for all aspects, short of major policy decisions, of the education service in their regions.  APPENDIX I Page 3 10. In most regions, mirroring the new structure of the central authority, the Regional Director will be assisted by a technical and an administrative branch, which will jointly constitute an Advisory Committee for him. The Technical Branch will be responsible for inspection, super- vision and guidance in all schools offering pre-primary or basic education in grades 1 - 9. Given the smaller number of upper secondary schools (grades 10 - 12) and the specialized nature of their programs, regions will be grouped together for supervisory purposes under a corps of specialist inspectors. 11. In each region, there will be a Community Council, comprising representatives of district education councils and parents' associations and constitutionally linked to the regional administrative service; its role will be to promote active community interest and participation in the educational process. 12. A key development in the concept of decentralization will be the development of nuclear or regionalized schools in accordance with,local needs. Thus, third cycle (former lower secondary - grades 7-9) schools will be established in central areas and will draw their students from the group of primary (grades 1 - 6) schools in the vicinity. In like fashion, graduates from grade 9 will be able to choose academic or technical programs from a smaller group of fourth cycle (former upper secondary - grades 10-12) schools serving the region. The development of a plan to meet regional needs will be one of the prime responsibilities of the Regional Director of Education. 13. Implicit in this structure is the need to train regional staff in their new functions. With the collaboration of ICAP and UNESCO, two courses have already been held (July - September, and October - November, 1972); others are under preparation. Coordination 14. The Government is well aware of problems arising from lack of coordinated planning, and is acting to resolve them: (i) coordinating committees both at national and regional levels have been appointed to integrate the work of the respective divisions; (ii) a coordinating comr- mittee has been appointed to determine the functions and areas of responsi- bility of the UCR, other higher education institutions, and INA in respect of manpower needs and training programs; and (iii) the Ministry of Education is studying the financial implications of the development plan for education in order to make better use of additional teachers and bring the construc- tion of new schools in line with budgetary constraints. Structure of Education 15. In accordance with the Plan, the school system of formal education now comprises four levels (Chart 2): (i) one or two years of pre-primary  APPENDIX I Page 4 education; (ii) basic education, divided into three cycles of three years each, compulsory in the first six grades (primary) and gradually so in the last three (lower secondary); (iii) three years of diversified education (upper secondary) with several course options; and (iv) two to seven years of higher education. Formal education normally begins between the ages of six and seven. All pre-primary, primary and secondary education is free. Pre-Primary Education 16. In 1971, enrollments, almost entirely in urban areas, reached 7,300 (75% of pre-primary institutions were State provided). Primary Education 17. Primary education is free and compulsory. Total enrollment in 1971 was 357,100 (Annex 3), representing 108% of the corresponding age group but 84% if overage and underage students are discounted. The ratio of boys to girls was 51:49. The introduction of automatic promotion and of special recuperative and guidance courses, designed to limit repetition and dropouts, is expected to reduce the rate of enrollment growth in primary schools by 1980, while increasing to 97% the actual age-group participation (Annex 4). Primary school teachers in 1971 numbered 12,280, a student/teacher ratio of alLiost 30:1. Mlany classes are greatly in excess of this size, the proportion being distorted by a considerable number of remote village schools with in- evitably lower student/teacher ratios. Most primary school teachers (86%) are (qualified normal school graduates (Annex 7), of those listed as unquali- fied, a number (550), have qualifications which are not sufficient for fully qualified status; 1,200 (10%) have no qualifications. The National Plan for Educational Development envisages considerable changes in the content and methodology of grades 1 - 6 programs with a lengthened school day (27 hours per week) and "a center of interest" approach to studies, grouped around science/maths, language/social studies, aesthetic education, practical subj- ects, religion and five optional periods, the latter to be used at the dis- cretion of school directors for civics, group activities and recuperative courses. Physical education and syllabus integration is planned. For all of these reforms, a heavy program of teacher in-service training is being prepared. Secondary Education 18. Under the pre-plan system, secondary education consisted of a lower cycle (grades 7 - 9) and an upper or diversified cycle of two years (grades 10-11) for academic courses or of three years (grades 10-12) for vocational courses. Grades 7-9 in the new plan form part of the nine-year basic education course. Following grade 9, there would be secondary edu- cation in the form of three-year programs. To the existing options in specialist (grades 10-12) schools -- academic, industrial, commercial and agricultural -- will be added new paramedical, communications, and art options. Secondary enrollments in 1971 were unbalanced both in terms of  APPENDIX I Page 5 retention rates between grades 9 and 10 and especially in the proportion of academic and vocational students (Annex 3); of the 86,000 enrollments in all forms of secondary education (26% of the relevant age group), 74% were in the lower cycle and 26% in the upper cycle; 92% were in academic schools and only 8% in vocational schools. Just over half of the enrollments were boys; 13% of the students were in private institutions. Efficiency within the system was impaired by high rates of repetition (in 1970 only 28% of students completed the course in the stipulated time) while dropouts amounted to 26% in the first year and 54% by the end of grade 12. 19. The new Plan projects both quantitative and qualitative improvements at this level. By 1980, enrollments in grades 7-12 would rise to 150,000; however, in the light of updated information, the mission believes that it would probably rise to 200,000 (Annex 4), an increase of 134% over 1971 figures. Over the same period, according to the mission, enrollments in pre-vocational and vocational schools would increase to 34,000 (370% increase over 1971 figures). As a percentage of the age-group population, there would then be 47% in grades 7-12. 20. New curricula and methodological techniques are in active prepara- tion for both these cycles. In academic programs, a balanced sciences and industrial arts, or home science timetable will avoid too early specializa- tion and resultant restrictions in future career decisions. In vocational programs, specialized studies will be matched by an academic content sufficient to ensure ready access to higher education as well as sound preparation for students entering employment at this level. There will be increased emphasis on mathematics, sciences and practical subjects; guidance counselors will assist students in making appropriate course and careers choices. The implementation of these programs will require the provision of practical and science facilities lacking in many schools. 21. In 1971, there were 3,500 secondary teachers (Annex 7) of whom 69% were fully qualified, 17% had qualifications insufficient for full re- cognition, and 14% were unqualified. To meet the expected 1980 enrollments, a further 4,000 teachers will be required for grades 7-12. Since the esti- mated output from teacher-training institutions through 1980 is lower, an intensive program of in-service training will be needed to upgrade surplus primary teachers and to reorient secondary teachers toward these new approaches. Higher Education 22. In 1971, enrollments in the University of Costa Rica reached 15,700 (52% women), principally in the Faculties of Sciences and Humanities, Education, Law, Economics, Engineering and Agriculture. A high dropout rate occurs during the first year. MIany undergraduates are part-time. The UCR is planning to develop regional centers which are being surveyed with IDB assistance. Two regional centers, at San Ramon and Liberia, are already in operation, but enrollments are low. Other higher education  APPENDIX I Page 6 institutions include the new National University, the Technical School of Agriculture and the National School of Nursery. Teacher Training 23. All teacher training in Costa Rica is at post-secondary level, at present two-years for primary teachers, mostly in four Normal Schools (Ileredia, Liberia, San Ramon and San Isidro), though a few are trained at the University; and four years for secondary teachers. 24. Automatic promotion and the restructuring of the education system would produce by 1980, on the basis of present estimates, a surplus of pri- mary teachers of the order of 1,600 (Annex 7), and a deficit, estimated at 2,000, of secondary teachers. The government plans, however, to lengthen the primary teacher training program from two to three years, in order to improve the personal and professional education of trainee teachers, and in both pre-service and in-service programs to divert considerable numbers of teachers to upper level preparation courses. Such measures will enable the government to match teacher supply and demand by concentrating on qualitative rather than quantitative criteria. They will also ensure that specialist teachers and administrators are available for the new teaching programs and for school and regional administration. A new approach to teacher training, based on a "credits" system, will improve the present bala;nce between general education, special studies and professional training. 25. To relieve the pressure for places at the University, the higher Normal School at Heredia was established by law in 1968 to conduct a four-year training program for secondary teachers and in-service training courses as required. Lack of facilities (with the exception of seven classrooms and a shared library, the school uses the premises of the adjacent Normal School) with consequent limitations in student contact hours, which in 1970 averaged 22 per week, have hampered progress. Enrollments are high, but output both in regular and short courses is disappointing, with high dropout rates: 1970 Total Enrollments Output Full-time courses: 949 71 In-service courses 357 74 In 1970, out of an initial enrollment of 1,069, some 120 failed to complete the year. The Higher Normal School, together with the four Normal Schools, have now been integrated into the National University, a new autonomous institution created by law in February 1973. The broad objectives of the new University include education, research and extension in all fields of knowledge. Until the governing bodies are legally established within two years, the University will be organized and administered by an ad-hoc Conmission.  APPENDIX I Page 7 Technical Education 26. Industrial and commercial education are provided in six fourth- cycle (grades 10-12) schools with a total enrollment of 2,023 students in 1971 (31% women). One non-public school (Don Bosco Technical Institute) also enrolls 365 students. These schools are being expanded both in size and number under a project of the Inter-American Development Bank. The commercial students follow a weekly schedule of from 36 to 39 periods, 20 of which are in their vocational speciality. The industrial student weekly schedule provides 40 periods, 20 of which are in the vocational speciality and two in technical drawing. The industrial and commercial fourth cycle is three years in length. From 76% to 90% of graduates are employed in the field for which they are trained; 10% - 15% continue their education and 3% - 5% enter other occupations. The new plan of studies for "diversified education" increases the time in the vocational specialty to 20, 26 and 30 periods in the first, second and third years of the fourth cycle, respectively. 27. Middle level technician training does not exist in Costa Rica. Ilowever, the Institute of Technology, Cartago, established by law in 1971, will enroll its first class of 200 students in iarch 1973, and its first graduates will appear in November 1975. The plan of studies provides for a general preparatory year followed by two years in an area of technical specialization. Present plans are to offer specialties in construction, electronic, electro-mechanical and forestry technology. An application has been made for a grant from the Inter-American Development Bank to make the necessary surveys and plan the development of this institution. 28. The education of professional engineers is the responsibility of the Faculty of Engineering, UCR, which offers courses in civil, electrical, mechanical, chemical and industrial engineering. Curricula in the Faculty of Engineering are being reviewed and it is difficult to determine the annual output of engineers. However, the College of Engineers of Costa Rica, in which most practicing engineers and architects hold membership, has about 600 members. Shortages exist in civil and construction engineers and the University does not appear to be able to meet the demand. Demand and supply seem to be in reasonable balance in electrical and mechanical engineering. Output exceeds demand in chemical engineering. Agriculture and Home Science Education 29. Agriculture and home science education are offered at the lower secondary (third-cycle, grades 7 - 9) rural schools (Institutos de Capacitacion Tecnica). Three of these schools were established in 1971 (Jicaral, Aguas Zarcas and Buenos Aires) and eight, in 1972 (Nandayure, Hojancha, La Suiza, Pacayas, Los Chiles, Upala, Puerto Viejo and Santa Maria); all of them are located in rural areas lacking provision for grades 7 - 9. They are planned to offer programs basically parallel with those in academic schools but with a pre-vocational component in agriculture or home science relevant to the needs of the area. A special and innovative feature is the  APPENDIX I Page 8 provision of facilities for the development of community activities and extension work. They would, thus (i) alleviate acute enrollment pressures, (ii) contribute to rural development programs, and (iii) assist in the equalization of educational opportunity, objectives clearly defined in the educational development plan. The introduction of agriculture and home science subjects in the curricula is not intended to provide specialized training for technician positions, but to provide students with a better understanding of the rural environment and some basic skills, with the understanding that these can be further improved through non-formal training. 30. At present, the vocational content of the curriculum appears to be high (20 periods a week out of a total of 42). At least for a few years, the majority of the students will be unable to proceed to higher levels of education because of lack of opportunity, and that the new courses will provide a better preparation for the world of work in the rural environment, and may become eventually instruments of change from traditional agriculture to modern farming. Under present circumstances, the curriculum can be accepted, as a transitional step, during the first years of development of these schools. Other activities are designed to meet the over-all objectives of these rural schools, i.e. (i) non-formal courses offered to improve skills among. farmers and homemarkers; (ii) community activities directed to serve social needs; and (iii) participation in rural development activities in coopera- tion with other public and private organizations. The schools have been located in areas where agriculture is the main economic activity and where no previous lower secondary school existed but a large supply of primary school leavers is available. An important aspect in the selection of areas has been the eagerness for the school shown by the community and its attitude to participate in the program -- e.g., provision of free land, construction or allocation of temporary quarters, furniture, teaching materials, etc. 31. It is expected that the existing lower secondary (third cycle) rural schools will evolve into upper secondary (fourth cycle) agricultural schools during the 1970s; at least three of them (Jicaral, Aguas Zarcas and Buenos Aires) by 1974. By then, the vocational courses at the third- cycle (grades 7 - 9) level would be substantially reduced. It is also expected that, with the experience gained, the government will be in a better position to establish rural development centers based on these schools. 32. Students entering the lower secondary rural schools are primary school leavers from the locality and from the neighboring communities. Agri- cultural. teachers are graduates from the Higher Normal School and a few agri- cultural technicians with pedagogical training; 80% of them are qualified teachers (Annex 7). A new program for teachers is being considered in which the students who have completed the two-year course at the post-secondary Technical Agricultural School (Escuela Tecnica Agricola) will take a special  APPENDIX I Page 9 program of studies at the Higher Normal School on pedagogy and on the methodology of teaching agriculture. Home science teachers are graduates from the Higher Normal School and a few of them from fourth-cycle agricultural schools with some pedagogic training; 87% of them are qualified teachers (Annex 7). The number of schools, student enrollment and number of teachers are as follows: 1971 1972 1980 (estimate) No. of Schools 3 11 11 Student Enrollment 388 1,509 4,800 - Male 190 742 2,400 - Female 198 767 2,400 No. of Teachers 39 122 230 - Academic 24 64 120 - Agriculture 8 30 55 - Home Science 7 28 55 33. In addition to the eleven third-cycle rural schools referred to above, there are eight secondary agricultural schools (grades 7-12) which offer agriculture and home science programs at the third-cycle (grades 7-9) level. In 1971, the total enrollment at this level was 2,297 (Annex 3) comprising 1,909 students in the secondary agricultural schools (grades 7-9) and 388 students in the three above mentioned rural schools. 34. Agriculture and Home Science education at upper secondary level (fourth-cycle, grades 10-12) are offered in nine agricultural schools (Institutos Agropecuarios). As already stated, eight of these schools also offer agriculture and home science programs at third-cycle level; one (private school) offers only a fourth-cycle program. These schools are located in important rural areas (Puriscal, Liberia, Osa, Siquirres, Orotina, Coto Brus, Pococi, Juntas and Santa Clara) and all of them except one (Osa) are receiv- ing financial and technical assistance from IDB. The total enrollment was 764 in 1971 (Annex 3) and 2,540 in 1972. The weekly schedule provides 40 periods per week, of wlhich 20, 20 and 32 periods in the first, second and third years of the fourth cycle, respectively, are in agriculture or home science. 35. Agricultural education at the post-secondary, technician level is offered at the Technical Agricultural School (Escuela Tecnica Agricola) in Santa Clara. This school was created by law in 1970 with the purpose of training, in a two-year program, technicians for management and extension work. The capacity of the school is for 110 students, all of them residents. The program started in 1971 with 60 students and 11 professors; the enroll- ment in 1972 was 110. An output of 50 per year is envisaged. The physical facilities are excellent, and the laboratories and workshops are very well  APPENDIX I Page 10 equipped. The school is receiving financial and technical assistance from USAID. The Ministry of Agriculture and the UCR in a well coordinated effort are supporting this technical agricultural school. A second school of this type which would specialize in animal husbandry is in the planning stage. There is no home science teaching program at post-secondary, tech- nician level, but the Ministry of Agriculture is interested in establishing one in Guanacaste for which financial aid is being sought. 36. At the University level, the Faculty of Agriculture, UCR, offers a degree of "Ingeniero Agronomo" and graduates approximately 15 students per year. The graduates are in great demand and are employed as managers, re- search assistants, supervisors for agricultural extension, credit, marketing, agro-industry, agro-business, agricultural services, etc. It is estimated that at least 50 agricultural graduates per year are needed for the next 15-20 years and the facilities, curriculum and staff of the Faculty of Agri- culture are being improved with financial and technical assistance from IDB and USAID. No home science education programs exist in Costa Rica at the University level. At the post-graduate level, the University of Costa Rica is planning to offer the degree of Master. The Teaching and Research Center of the Interamerican Institute of Agricultural Sciences (IICA) at Turrialba, is being transferred to the Government. The Ministry of Agricul- ture will establish there a multinational, regional research center and the UCR will develop a post-graduate program. Assistance from IICA and possibly from other sources is being sought. Non-Formal Education 37. The main agencies concerned with non-formal education are the Ministry of Education and INA (National Institute of Apprenticeship). In 1971, enrollments in adult evening classes organized by the Ministry totalled 7,300. Programs in the main were at primary level with some literacy courses. In the same year INA enrollments in a variety of skill training and upgrading programs reached 6,300. Extension programs in agriculture, health and nutrition are offered by the Ministries of Agricul- ture, Health, Labour and Social Welfare, and Culture, Youth and Sport. 38. INA is responsible for vocational training of out of school youth and adults in specific occupations. INA operates as an autonomous body within the Ministry of Labour and is financed by a one percent payroll tax on the salaries paid by industrial and commercial enterprises with 5 or more employees and by autonomous and semi-autonomous bodies with total annual salaries of