Tunisia - Cooperative Farm Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 9 6 8 PROJECT PERFORMANCE AUDIT REPORT TUNISIA COOPERATIVE FARMS PROJECT (Loan 484-TUN/Credit 99-TUN) J a n u a r y 8 , 1976 O p e r a t i o n s E v a l u a t i o n Department I 1 I This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  FOR OFFICIAL USE ONLY PREFACE This r e p o r t presents the r e s u l t s of an a u d i t of the p r o j e c t supported by Loan 484-TUN f o r US$12.0 million and Credit 99-TUN f o r US$6.0 million, both signed i n February 1967. A r e v i s i o n was agreed i n November 1970 and the amounts were reduced t o US$6.1 m i l l i o n f o r the Loan and US$3.1 m i l l i o n f o r the Credit. These sums were f u l l y disbursed and the Loan and Credit closed i n March 1974. The Audit was based on a review of the p r o j e c t ' s a p p r a i s a l r e p o r t , supervision r e p o r t s and other material i n Bank f i l e s ; on the P r o j e c t Completion Report prepared i n January 1974 by the Europe, Middle East and North Africa Regional Office; on consultation with Bank personnel; on published secondary materials; on b r i e f t a l k s with University s t a f f and Tunisian students a t the University of Minnesota; and on lengthy discussion i n !t'unisia with o f f i c i a l s , researchers, donor agency personnel, cooperateurs, private farmers and farm workers. The e x c e l l e n t a s s i s t a n c e provided by Tunisian i n s t i t u t i o n s i n the preparation of t h i s report, i n p a r t i c u l a r the Office des Terres Domaniales and the Ministere de l l A g r i c u l t u r e , i s g r a t e f u l l y acknowledged. Foreign Exchange Rate (l'unisian Dinars : 1 Dinar = 1,000 lClillimes ) - September 1964-December 1971: US$1 = D 0.520 December 1971-Decembe r 1974: US$1 = variable r a t e f l u c t u a t i n g between D 0.484 and 0.391 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  PROJECT DATA Original Project Amount of Loan bob-TUN US$12.0 m i l l i o n Amount Cancelled US$ 5.9 m i l l i o n Amount of C r e d i t 99-TUN US$ 6.0 m i l l i o n Amount Cancelled US$ 2.9 m i l l i o n Date of Loan/Credit Agreement February 21, 1967 Date of E f f e c t i v e n e s s July 3, 1967 O r i g i n a l Closing Date June 30, 1971 Revised P r o j e c t Amount of Lmn US$ 6.1 m i l l i o n Amount of C r e d i t US$ 3.1 m i l l i o n Date of Revised Loan/Credit Agreement November 23, 1970 E f f e c t i v e Date March 24, 1971 O r i g i n a l Closing Date March 31, 1972 F i n a l Closing Date March 1974 Date of Last Supervision Mission October 1977 Date of Issue of PCR January 31, 1974  TABLE OF CONTENTS Page Summary i I. Introduction 1 11. The Context of t h e P r o j e c t : The Cooperatives Program 1962-1965 2 111. The P r o j e c t and t h e Loan/Credit: Identification, Design, Appraisal and Approval IV. Implementation and Revision of t h e O r i g i n a l P r o j e c t 10 A. P r o j e c t Costs and Disbursements 10 B. Problems Affecting t h e Progress of t h e Cooperative8 Program (1966-1968) 12 C. 1968 Reforms of t h e U CP Program 17 D. 1969 Policy Changes 18 E. Project Revirion 18 V. Implementation of t h e Revised P r o j e c t 23 A. P r o j e c t Costs and Disbursements 23 B. The Functioning of t h e Cooperatives Program, 1970-1974 23 VI. P r o j e c t Impact 27 A. Production and P r o d u c t i v i t y B. Equity and Employment C. Profitability , D. I n s t i t u t i o n a l Development E. Other Program Impact F. Review of Results G. Rates of Return VII.. Lessons About C o l l e c t i v e Farming Systems 36 VIII. Bank Performance 39 A. Appraisal B. Supervision IX. Conclusions 45 -exes 1-18 47 Selected Bibliography 69 Maps 1. ~ i s t r i b u t i o nof ' s t a t e Lands, 1966 2. Farm Cooperative Production Units, 1966  L i s t of Tables (Text) 1. Planned and Actual Funding Categories of t h e Original Project and t h e ~ o a n k r e d i t 10 2. Comparison of Disbursements of t h e Original and Revised ~ o a n k r e d ist 21 3. Oomparison of Average Yields Achieved by Colon Farms and Phase I 1 1 UCPs 28 4. Progress Toward P r o j e c t Objectives 1 3r L i s t of Annexes Annex Table - No. - No. 1 Summary of Evolution of ~ o a n / ~ r e d Funding it 48 2 Summary of P r o j e c t Evolution by Disbursement Cat e g o 4 45 1 C h a r a c t e r i s t i c s of UCP1s Created Each Year, 1962-68, by Gouvernorat 49 1 Comparison of C h a r a c t e r i s t i c s of UCP1s, 1 962-1 974 50 1 Origin of Lands Incorporated i n t o UCP1s, 1963-68 51 2 Origin of Lands Incorporated i n t o UCP1s, 1966, by Gouvernorat 51 1 D i s t r i b u t i o n of S i z e of Land Holdings Contributed t o UCP1s by Cooperateurs 52 2 Number of Active and I n a c t i v e Cooperateurs, by Gouvernorat, 1 966 52 1 Funding Categories and Foreign Exchange Costs of Original P r o j e c t and ~ o a n k r e d i t 53 1 1967 Projection of Gross Income of One 1,000 Ha, UCP, by Product, During F i r s t 8 Years of Operations 54 Assumptions Used i n 1967 Projections of Gross Income f o r One 1,000 Ha. U CP 55 1 1967 Cash Flow Projection f o r One 1,000 Ha. U C P 56 1 F i n a n c i a l Results of UCP1s, 1966-1973 57 1 Bank of Agriculture (BNT)Loans and Credit t o A l l A g r i c u l t u r a l Cooperatives, 1 96k-68 58 2 T o t a l Debt and Arrears of UCP1s, 1968-69 58 3 Short Term Loans and Credit t o UCP1s, 1969-74 58 1 Successive Modifications i n t h e L i s t of Goods (Funding by categoqy) Under t h e Revised ~ o a n k r e d i t ,1970-1 974 59 1 1970 and 1973 C h a r a c t e r i s t i c s of UCP1s, by Region 60 2 Comparison of 1970 and 1973 C h a r a c t e r i s t i c s of UCP1s 60  Page Annex Table -- No. No. Comparison of Yields i n Cereals, Colon Farms, Tunisian Private Sector and UCPls, 1937-1 975 Area, Production and Yields f o r Wheats, Barley and Oats, and Pulses, UCP1s, 1967-75 Area Planted in Different Crops by UCP1s, 1 974 Average Income Per Cooperateur, 1962-74 Average Income Per Cooperateur, by Region, 1969-73 Project Identification, Design and Appraisal Missions IBRD/IDA Supervision Missions Tunisia Cooperatives Project; Analysis of Frequency and Length of Missions by IBRD Personnel (Excluding FA0 Missions ) 18 Chart Comparison of Spring and F a l l Rainfall with H a r d and Soft Wheat Production in Northern Tunisia, 1946-1 969  Project Performance Audit Report TUNS I I A COOPERATIVE FARMS PROJECT U S MMARY 1. The Tunisia Cooperative Fams Project agreement, signed on , February 21 1967, provided u s 1 8 million of Bank/IDA funds ( b a n 484 f o r U s 1 2 million and C r e d i t 99 f o r uS$6 million) t o the Government of Tunisia (GOT) f o r t h e development of a g r i c u l t u r a l production cooperatives (UCPS) in northern Tunisia. bank/^]^ funding represented 55% of the t o t a l p r o j e c t c o s t of US$32 million. The loan/credit was designated f o r the purchase of farm machinery and i r r i g a t i o n equipment, construction of farm buildings, import of bulls, development of farm f e a s i b i l i t y s t u d i e s by foreign consultants, and provision of technical advi.sory services by foreign a g r i c u l t u r a l experts. A l a t e r revision allowed f o r the estab- lishment of r e p a i r f a c i l i t i e s f o r farm machinery. 2. The p r o j e c t aimed t o accomplish t h r e e main objectives over a four-year period (1 967-71 ): (1 ) t h e creation of 160 new UCPs averaging 1,000 ha each on 160,000 ha of s t a t e and p r i v a t e land; (2) t h e consoli- dation of 21 3 e x i s t i n g UCPs on 185,000 ha of s t a t e and p r i v a t e land; and (3) the maintenance of productivity on 313,000 ha of s t a t e lands organized i n t o state farms t h a t were t o be transformed i n t o cooperatives a t a l a t e r time. 2 J. Most of t h e p r o j e c t funds were administered by the Banque Nationale Agricole (BNA), l a t e r the Banque Nationale de Tunisie (BNT), which extended loans and c r e d i t s t o the individual UCPs and t h e s t a t e farms. The BNT acted on the recommendation of the Bureau of Control (BC), an organization created by the p r o j e c t and responsible f o r the planning, programming, and implemen- t a t i o n of the project. 4. The s t a t e lands included in the p r o j e c t were located in Tunisia's productive northern wheatlands. Most of the s t a t e lands had been acquired in the l a t e 1950s and e a r l y 1960s from departing French and I t a l i a n s e t t l e r s (colons). The p r i v a t e lands incorporated i n t o t h e UCPs were intended t o be small subsistence farms ranging in s i z e from 0.5 ha t o 5 ha, although many of t h e farms f e U outside t h i s range. The UCPs were designed each t o include a nucleus of s t a t e land and t h e subsistence farms snrounding t h e nucleus, but in p r a c t i c e t h e UCPs included both contiguous and non-contiguous parcels of' s t a t e and p r i v a t e l a n d and a few were formed only of p r i v a t e lands. 5. The p r o j e c t w a s p a r t of a program i n i t i a t e d by t h e GOT in 1962 t o e s t a b l i s h cooperatives in all sectors of t h e Tunisian economy. The UCPs f o r the northern uheatlands, one of t h r e e main -8s of a g r i c u l t u r a l cooperatives, were designed with f i v e goals i n view: (1 ) t o maintain t h e l e v e l s of produc- t i o n achieved on t h e colon farms; (2) t o eliminate subsistence a g r i c u l t u r e by raising l e v e l s of productivity on incorporated private smallholdings; (3) t o diversify agricultural production; (4) t o increase the employ- ment capacity of the project lands and t o provide jobs f o r t h e ex-colon workers, f o r the incorporated subsistence fanners, and f o r landless seasonal farm workers; and ( 5 ) t o increase the incomes of these three groups of Ifcooperateursn. All of the UCPs were included i n the Bank/ GOT project; the GCIT administered the other a g r i c u l t u r a l cooperatives separately. 6. There were continual delays i n t h e disbursement of project funds, due d n l y t o d i r f i c u l t i e s i n developing t h e p r o j e c t ' s administrative system and f a c i l i t i e s , delays i n bidding and procumment a c t i v i t i e s , and problems i n the functioning of t h e overall cooperatives program during 1956-1968, Phase I of the project. The operational problems of t h e overall program can be divided i n t o e i g h t related categories: (1 ) technical d i f f i c u l t i e s , caused mainly by the complexity and s i z e of the 1,000 ha UCPs; ( 2 ) shortage of competent management f o r the UCPs; (3) conflicting o f f i c i a l goals and attitudes; (4) problems in developing the effectiveness and authority of the Bureau of Control; ( 5 ) the l a c k of progress of the livestock component and other key elements of the initial project design; (6) the shortage of investment funds before 1967 and the deteriorated physical c a p i t a l inherited fmm the colons; (7) shortages of r a i n f a l l from 1966 t o 1969; and (8) the disaffection of many of the members of t h e cooperatives. 7. I n order t o solve these problems, the GOT in September 1968 under- took a s e r i e s of major reforms of the U CP program. Zn Januarg 1969, j u s t as the effects of these reforms were beginning to materialize, senior govern- ment o f f i c i a l s decided to accelerate and expand the cooperatives program by abolishing t h e private sector i n agriculture altogether, transferring a l l remaining arable land i n the country i n t o production cooperatives. The land i n the Bank/GOT UCPs was t o be increased from 345,000 ha t o 433,000 ha. For nine months opposition t o the program grew rapidly among the l a r g e r private farmers, the s m a l l farmers recently included in the program, and the cooperateurs. Iargely a s a result of this opposition, in September 1969 the GOT decided to reestablish the former rights of the private s e c t o r i n agriculture and t o make cooperative membership e n t i r e l y voluntary. After t h i s policy reversal, all private fanners withdrew t h e i r lands from the pmchrction cooperatives and the UCPs were reorganized from adjacent parcels of s t a t e lands. The remaining cooperateurs were former employees on t h e colon/state f a n s o r former seasonal fann workers. The unsettled year 1969 is referred t o i n the audit as Phase 1 1 . 8. In 1970 the GOT redesigned the e n t i r e cooperatives program and requested Bank assistance i n a revised UC P project. A t this time ~S$6.0 of the original project funds had been disbursed. The Bank agreed t o disburse an additional US$3.2 million f o r the revised project and cancelled t h e remaining US$8.8 million. The p r i n c i p a l o b j e c t i v e of t h e r e v i s e d p r o j e c t and Phase I 11 w a s t o maintain p r o d u c t i v i t y on 202,000 ha of state 1 2 . 3 orga- nized i n t o 21 8 UCPs. 9. There were no s e r i o u s delays o r problems i n t h e disbursement of t h e funds of t h e r e v i s e d p m j e c t , although t h e r e was a s e r i e s of modifica- t i o n s of t h e list o f goods. The most important modification w as a US$0.6 m i l l i o n increase i n t e c h n i c a l a s s i s t a n c e funding t o provide f o r extensions of t h e c o n t r a c t s of t h e f o r e i g n advisors. A f t e r 1970 t h e management of t h e UCPs and t h e administration of t h e program improved s i g n i f i c a n t l y and by March 197b, when t h e p m j e c t w as closed, t h e program had developed i n t o an e f f e c t i v e system f o r d i r e c t i n g t h e development of a c r i t i c a l segment of t h e Tunisian a g r i c u l t u r a l s e c t o r . 10. Production information f o r UCPs i n Phase I is scarce. It would appear t h a t c e r e a l output on colon l a n d declined, but t h e d e c l i n e may n o t have been s u b s t a n t i a l and it i s uncertain whether one should a t t r i b u t e i t mostly t o t h e poor rainfall p a t t e r n , t o f a u l t y farm management, o r t o o t h e r factors. The p r o d u c t i v i t y of incorporated p r i v a t e lands seems t o have increased, though a t l e a s t some of t h e s e gains were o f f s e t by voluntary cutbacks of production by n o n p m j e c t p r i v a t e farmers elsewhere i n t h e region who feared eventual c o l l e c t i v i z a t i o n . Production in all c a t e g o r i e s was well below a p p r a i s a l p r o j e c t i o n s , however. 11. On t h e f i n a n c i a l s i d e t h e UCP s i t u a t i o n in Phase I i s b e t t e r defined: cooperateur incomes f e l l below pre-project l e v e l s and most of t h e UCPs l o s t money each y e a r through 1968. The r a t e of r e t u r n t o t h e p r o j e c t r e c a l c u l a t e d a t t h a t p o i n t would have been c l o s e r t o z e m than t o t h e f o r e - c a s t 10%. 12. Phase I i s u s u a l l y considered t o have done poorly, but t h e judg- ment may be t o o harsh. With t h e 1968 reforms, b e t t e r weather, and o t h e r improvements, many o f t h e Phase I coops appear t o have been moving toward financial viability. The l o y a l t y of t h e cooperateurs had been p a r t i a l l y undermined however and t h e r e a c t i o n to t h e January 1969 orders c u t o f f t h e upturn and eliminated any opportunity of t e s t i n g whether t h e Phase I UCPs could, i n t h e l o n g run, have succeeded. Many Bank and GOT observers think t h e y would have. Obviously all p a r t i e s had misjudged t h e time required t o s t a f f , equip and b r i n g t o success 1,000 ha production cooperatives blending s t a t e lands and p r i v a t e lands under new c u l t i v a t i o n systems. 13. The Phase I U C P form aborted, but t h e Phase I 1 1 form seems t o have a l r e a d y e s t a b l i s h e d a successful record w i t h r e s p e c t t o most of t h e o r i g i n a l project objectives - p r o d u c t i v i t y , production, worker incomes and i n s t i t u - tional viability. P r o j e c t goals r e f e r r i n g t o t h e e l i m i n a t i o n of subsistence fanning, and t h e membership of p r i v a t e land owners, have had t o be abandoned, however, and t h e revised p r o j e c t i s as a consequence l e s s innovative and comprehensive than the design t h e Bank had approved with special a t t e n t i o n in 1967. 14. The Bank's original contribution t o the technical elaboration of a complex f a m plan, which i s now working reasonably well, i s t o be commended, as i s the Bank's f l e d b i l i t y in working with the GOT i n 1969/70 t o prepare a successor project. Given t h a t complexity, and t h e fundamental change i n land tenure, i t appears i n retrospect that the Bank spent a disporportionate share of its a n a l y t i c a l resources i n pmparing and appraising the project, while hardly any i n measuring farm l e v e l progress and helping adjust technical and economic plans during implementatim: t h a t is, during Phase I supervision. Phase I11 supervision gave greater attention t o these variables. Neverthe- l e s s the Bank has to d i m c t more s t a f f resources t o supervision of projects based on broad agrarian reforms. 15. The project h i s t o r y has several important lessons. It does not tell us much about genuine cooperatives, but it does i l l u s t r a t e the d i f f i - c u l t i e s of bringing or holding independent farmers together under any system of collective management t o which they give up some r i g h t s t o land and receive inadequate or disappearing economic incentives in return. The study a l s o underlines the c r i t i c a l r o l e of management in the e a r l y stages of the develop- ment of large scale s t a t e farming: on the one hand, the e a r l y a v a i l a b i l i t y of trained and s p i r i t e d directors i s e s s e n t i a l t o the success of individual farms; on the other hand, the c e n t r a l project unit must be given the resources and power t o grow rapidly with the project and adjust implementation plans t o the inevitable turns of a largely unpredictable development path. Finally, there i s an obvious and probably significant correlation between improvements i n incentives offered t o managers and workers and improvements in performance.  P r o j e c t Performance Audit Report TUNISIA COOPERATIVE F M PROJECT INTRODUCTION 1.01 I n 1964, t h e Government of Tunisia (GOT)requested Bank support f o r Tunisia s 10-year program of a g r a r i a n reform. The o r i g j n a l proposal was f o r t h e Bank t o h e l p finance new cooperatives on 800,000 ha, over a four-year period, but t h e t a r g e t s were s c a l e d down during a lengthy process of preparation and a p p r a i s a l . , On February 21 1967 p r o j e c t agreements were signed f o r a l o a n of ~ S $ 1 2m i l l i o n and a c r e d i t of $6 million; t h e p r i n c i p a l o b j e c t i v e s included t h e establishment of 160 new cooperatives on 160,000 ha of s t a t e and p r i v a t e land over a two-year period, t h e improvement of 213 e x i s t i n g cooperatives on 185,000 h a of s t a t e and p r i v a t e land, and t h e maintenance of operation of s t a t e farms on 31 3,000 ha. Numerous problems prevented t h e e f f e c t i v e functioning of t h e p r o j e c t cooperatives during t h e first s e v e r a l years, although t h e r e were s i g n s of improvement i n l a t e 1968. 1.02 I n January 1969, the GOT suddr?_LJr, r ~ q o ~ c e d plans t o expand t h e program LJ trans'onning a l l remaining a r a b l e land in t h e country i n t o production cooperatives. Then i n Sep*mber 1969, l a r g e l y as a result o f growing opposition from p r i v a t e farmers, t h e GOT r e v e r s e d i t s e l f , t e d - n a t i n g involuntary c o o p e r a t i v i z a t i o n and o f f e r i n g to r e l e a s e p r i v a t e holdings. A l l p r i v a t e fanners removed t h e i r lands during t h e n e x t year. 1 .03 The p r o j e c t was redesigned t o concentrate resources on improving operation of 21 8 recons ti t u t e d cooperatives occupying 202,000 ha of s t a t e land. In November 1970, a r e v i s e d loan/credit agreement f o r ~ S $ 9 . 2 m i l l i o n w as signed, including ~S$6.1 a l r e a d y disbursed. A f t e r two extensions t h e revised loan/credit w as c l o s e d i n March 1974. 1.04 In t h e following c h a p t e r s t h e p r o j e c t ' s h i s t o r i c a l sequence i s divided i n t h r e e phases. Phase I (1 966-1968) covers t h e period up t o t h e January 1969 orders. It begins before t h e d a t e o f t h e agreement, s i n c e t h e p m j e c t p l a n s and t h e expectation of Bank finance had a l r e a d y begun t o e x e r t s u b s t a n t i a l influence m decision8 regarding t h e o v e r a l l cooperative program. Phase I1 (1969) covers t h e t r a n s i t i o n , i n c l u d i n g the e a r l y aftermath of t h e September 1969 reversal. Phase 1 1 1 (1 970-1 974) covers t h e p e r i o d s i n c e t h e p r i v a t e lands were removed and t h e r e v i s e d p r o j e c t w a s negotiated. Compari- sons a r e made between performance i n Phases I and 1 1 1 . 1.05 An important d s t i n c t i o n i s made between t h e GOT'S cooperative p m ~ r a m , i n i t i a t e d in 1962, and t h e GOT-Bank cooperative p r o j e c t . Not all t h e cooperatives i n t h e program were embraced by t h e p r o j e c t , a s shown l a t e r . 1.06 A summary of t h e evolution of funding is s h w n in annex 1.  THE CONTEXT F THE PROJECT: O THE COOPERILTIWE P R O W 1 9 6 w -- 65 2.01 In 1956, the year of Tunisian independence, French and I t a l i a n farmers (colons) owned approximately 700,000 ha of t h e b e s t a g r i c u l t u r a l land in the country; t h e i r holdings represented about 1b% of Tunisia's arable farm- land and accounted f o r about 40% of all a g r i c u l t u r a l production. 1/ Appmd- mately 400,000 ha of the colon lands were located in t h e northern, predomi- nantly wheat pmducing regions of t h e country. The average s i z e of t h e colon holding w as about 149 ha; however, because the colons often mnted additional land from Tunisian farmers, the average s i z e of t h e farms a c t u a l l y cultivated by the colons i s known t o have been l a r g e r , The remainder of t h e arable land was owned by the taro main groups of Tunisian fanaers: 5,000 "modernN fanners whose holdings averaged about 80 ha, and 450,000 ltmarginalmfarmers whose p l o t s averaged about 7 ha. In 1959, the p e r capita annual come f o r 879 of the people in the rural sector w a s l e s s than D 50 ($11 9). 8 2.02 During t h e l a t e 1950s and e a r l y 19609, the GOT acquimd about 11% of the countryts a g r i c u l t u r a l lands, including over 300,000 ha of colon lands purchased as t h e colons gradually l e f t Tunisia, and about 200,000 ha acquimd through t h e abolition of the "habousm, t h e t r a d i t i o n a l tenure system of non- transferable landholdings. Ihe GOT i n i t i a l l y began to redistribute these lands to individual Tunisian farmers i n the "modernm sector, but i n 1962 i* reclaimed the redistributed lends and announced the i n i t i a t i o n of the coopera- t i v e s program. 2.03 The principle o f cooperation was i n k d e d t o be t h e underlying con- cept of a l l aspects of the economic and s o c i a l development of the nation, and the basis f o r the national ideology, The economy was t o include t h ~ sectora e - the cooperative, State, and private sectors. Cooperatives were t o be organized mainly among the l e s s e f f i c i e n t producers in each a c t i v i t y of t h e economy, while t h e more e f f i c i e n t producers were generally t o be allowed t o remain in the private sector. 2.04 In the agricultural sector, three main types of cooperatives were i n i t i a t e d : (1) "cooperatives de servicev, t o provide services f o r the more productive modern private f anus throughout t h e country; (2) a cooperatives de polyculturav, production cooperatives, with some service elements, f o r the l e s s productive lands i n C e n t r a l and Southern Tunisia; and (3) ncooperatives de production du Nord", f o r t h e S t a t e lands and small subsistence holdings In the most pmductive Northern wheat regions. I n addition, pre-coopera- t i v e s were designed a s a t r a n s i t i o n a l form f o r State land in which the workers were not experienced enougfi f o r " c o ~ p e r a t e u rstatus.~~ 1/ Estimates of t h e t o t a l amount of land owned by the colons range from 600,000 ha t o 850,000 ha. 2/ The data i n this paragraph i s derived mainly from information in Les Cooperatives Agricoles de Production en Tunisie (see bibliography). 2.05' The "cooperatives de production du Nord" (UCPS), which we r'e l a t e r t o be t h e f o c a l point of t h e p r o j e c t , were planned t o occupy an average 1,000 ha. They were designed to accomplish f i v e s p e c i f i c objectiv3s: ( 1 ) t o maintain the l e v e l s of production on t h e former colon farms; ( 2 ) t o eliminate subsistence a g r i c u l t u x by improving production l e v e l s on small holdings; ( 3 ) t o d i v e r s i f y pmduction on all these lands; ( 4 ) t o increase t h e employment capacity of these lands; and (5) t o achieve s o c i a l equity by d i s t r i b u t i n g t h e r e t u r n s from the colon farms t o t h e i r former workers and by improving t h e Lxcomes and l i v i n g standard of these workers, the small t r a d i t i o n a l farmers, and landless seasonal laborers. The specific income goal w as t o achieve by 1971 an annual income of D 250 f o r each cooperateur, o r an average of D 50 per family member. 2 -06 The a l t e r n a t i v e of r e d i s t r i b u t i n g t h e lands i n individual p l o t s t o t h e colon workers, smallholders, and seasonal workers was considered by t h e GOT but rejected f o r a t l e a s t f o u r main reasons,according t o GOT rep- resentatives and Bank s t a f f members. First, it was feared that these groups lacked t h e necessary technical and managemerrt expertise t o maintain current production l e v e l s and t o apply new technology. Second, t h e r e w a s not enough land t o provide all of these people w i t h p l o t s which w e r e considered t h e minimum farm s i z e (from 15-25 ha) t o produce t h e d e s i x d income goal of D2.5'0 p e r family. T h i r d , it was feared t h a t f o r various reasons t h e re- d i s t r i b u t e d land might evantually be s o l d t o t h e l a r g e r farmers, thus r e s u l t i n g i n a re-consolidation of holdings. Fourth, t h e c u l t i v a t i o n of the lands i n small u n i t s w as expected t o cause a decrease i n productivity, due t o t h e l o s s of c e r t a i n technical and economic advantages of t h e colon units. 2.07 The UCP farms, s u b s t a n t i a l l y exceeding i n s i z e t h e average colon unit, were expected t o have s c a l e advantages which would f a c i l i t a t e crop d i v e r s i f i c a t i o n and t h e introduction of new p a t t e r n s of land c u l t i v a t i o n , would economize on mechanized equipment and t h e extxmely l i m i t e d managerial and t e c h n i c a l e x p e r t i s e a v a i l a b l e f o r t h e rural sector, and would produce greater employment opportunities than small farms could produce. 2.08 I n 1962-63, the GOT created 94 UCPs, with an average farm s i z e of 904 ha. Then in 1964 all of t h e remaining unsold c o l lands, which t o t a l l e d between 300,000-400,000 ha. were nationalized. It was at this time t h a t t h e GOT requested World Bank assistance. Between late 1964 and e a r l y 1966, while FA0 and t h e Bank were collaborating w i t h the GOT in t h e pmcess of defining and designing t h e project, an additional 205 UCPs were c~eated on 225,832 ha. of S t a t e and p r i v a t e land. By t h e end of 1966, UCPs occupied 15% of the t o t a l land i n t h e f i v e northern gouvernorats, o r pmvinces (maps 1-2, annexes 2 and 3). - 1/ The French lands were seized on May 12, 1964. The Fxnch Government r e t a l i a t e d by closing French markets. The p o l i t i c a l and economic confrontation between t h e GOT and t h e former metropolitan a u t h o r i t i e s forms a p a r t of t h e back-drop behind the cooperatives program which i s n o t t r e a t e d i n this report. 2-09 The individual UCPs were designed t o include a nucleus of S t a t e lands and t h e small private holdings located on o r near t h e perimeter of t h e nucleus. Some UCPs were t o be formed exclusively out of private holdings. Small landowners who did not choose t o become participating members of t h e cooperative had two options: t o give up t h e i r land i n exchange f o r other land outside the designated U C P area, o r t o become "inactive membersn and llent t h e i r land t o the cooperatives. The program aimed a t including primarily fanus fmm 0.5 to 5 ha., and attempted t o exclude farms l e s s than 0.5 ha. and over 20 ha. However, l a r g e farms were sometimes included i f they were located i n s i d e the cooperative perimeter o r i f there was an inadequate amount of land available t o support the l e v e l of membership planned f o r the coope- rative. These large fanns were rented by t h e owners t o the UCPs. Officials attempted t o form the UCPs from adjacent landholdings, but some UCPs included non-contiguous parcels. 2.1 0 By 1966, 46% of t h e t o t a l lands incorporated i n t o the UCPs were S t a t e lands, and 4% belonged t o t h e cooperateurs, who had each contributed an average of 5.1 ha. (annexes 4 and 5). Thirty-seven percent of these cooperateurs chose inactive s t a t u s and d i d not p a r t i c i p a t e d i r e c t l y in t h e cooperative. UCP members were given s h m s based on t h e amount of land contributed, and a portion of p r o f i t s w as to be distributed according t o share-ownership and t h e amount of work completed. During t h e year, members received an advance on this p m f i t in t h e form of d a i l y wages which varied according to technical specialty; these wages were intended t o range fmm 340 m ($0.56) t o 600 m ($1 -14) per day. 2.11 The d i r e c t o r of t h e e n t i r e cooperative program,including both a@- c u l t u r a l cooperatives and cooperatives i n a l l other sectors of the economy, w as t h e Secretarg af S t a t e f o r t h e Plan and t h e National Economy. He served also as t h e d i r e c t o r of three Under S e c r e t a r i a t s organized within his om: these included the Under S e c r e t a r i a t s of S t a t e f o r dustry and Commerce, f o r Finance and Development, and f o r Agriculture. L ? 2.1 2 The administration of t h e U CP program was divided among four i n t e r - acting hierarchies: (1) the Union of Cooperatives, which w as msponsible f o r the general administration of the cooperative program; ( 2 ) the Under Sec- r e t a r i a t of Agriculture, which was mainly involved i n t h e technical aspects but a l s o participated i n the implementation of the program; (3) the Under Secretariat of Finance and Development, which w as concerned l a r g e l y with financial decisions, but w as also involved in general administration; and (4) o f f i c i a l s of the l o c a l and mgional governments, including the Governor, a l l of whom were appointed by the c e n t r a l government. 1/ - I n 1970, this system w as reorganized and separate Kinistries were established f o r Industry and Cownerce, Finance and Development, and Agriculture. The S e c r e t a r i a t of S t a t e f o r t h e Plan and the National Economy was abolished. . 2-13 Ihe management of t h e i n d i v i d u a l UCPs during t h e mid-1960s w as handled j o i n t l y by: a d i r e c t o r , appointed by the Regional Union of Coopera- t i v e s ; a Council of Administration, e l e c t e d by t h e cooperateurs; and a President, e l e c t e d from and by the Council. A technical advisor, appointed by t h e Under S e c r e t a r i a t of A g r i c u l t m , w as responsible f o r many of t h e t e c h n i c a l decisions, such as choice of crops, l a n d u t i l i z a t i o n , s e l e c t i o n of seeds and f e r t i l i z e r s , and decis i o n s about i r r i g a t i o n . The planning, programming and budgeting functions were performed mainly by the Under S e c r e t a r i a t of Agriculture, while t h e Regional Union of Cooperatives executed most of t h e remaining administrative tasks. Financial decisions f o r t h e i n d i v i d u a l UCPs were handled j o i n t l y by t h e Under S e c r e t a r i a t s f o r Finance and Agriculture, and t h e Regional Union of Cooperatives. These complex i n s t i t u t i o n a l linkages were l a t e r s i m p l i f i e d under t h e p r o j e c t . 2.14 A s t h i s o u t l i n e of t h e organization of t h e cooperative program i n d i c a t e s , t h e UCPs were not designed t o be t r u e cooperatives according to t h e commonly accepted d e r i n i t i o n of t h e t e r m . S p e c i f i c a l l y , the UCPs were characterized by t h e following f e a t u r e s which are i n c o n s i s t e n t with t h e basic theory of cooperatives: (1 ) t h e UCPs were not voluntary; farmers within the designated perimeters d i d not have t h e r i g h t t o r e t a i n and work t h e i r own land; ( 2 ) the members, t h e e l e c t e d Council of Administration, and t h e President played a l e s s important r o l e in decision-making than t h e appointed d i r e c t o r ; ( 3 ) decision-making w as highly c e n t r a l i z e d , w i t h planning, pro- gramming, production, f i n a n c i a l and marketing decisions made &mainly by t h e Under S e c r e t a r i a t f o r Agriculture; (4) b a s i c t a s k s such as accounting were performed by o f f i c i a l s o u t s i d e t h e UCPs; t h e d i r e c t o r simply submitted t h e basic d a t a t o these o f f i c i a l s who prepared t h e accounts and cal.cubted profitability. The cooperateurs and t h e UCP o f f i c i a l s , including t h e d i r e c t o r s , often had no knowledge of the p m f i t / l o s s p o s i t i o n of t h e i r own cooperative; ( 5 ) t h e cooperateurs, in e f f e c t , worked a s wage-laborers on t h e farms and were promised guaranteed s a l a r i e s f o r t h e i r work, regardless of t h e a c t u a l output of the farms; and (6) t h e l a n d c u l t i v a t e d by t h e UCPs was n e i t h e r exclusively n o r predominantly contributed by the p a r t i c i p a t i n g members. These f e a t u r e s of t h e UCPs defined a unique type of organization which combined f e a t u r e s o f S t a t e , c o l l e c t i v e ,and cooperative farms. 2.15 There i s considerable difference of opinion concerning t h e r e a c t i o n of small p r i v a t e farmers t o t h e mandatory incorporation of t h e i r lands i n t o the UCPs . GOT and Bank o f f i c i a l s seem to have generally thought t h a t u n t i l 1968 farmers reacted favorably t o t h e promise of an assured income which would mach D 250 within a few years, and were therefore w i l l i n g t o accept mandatory incorporation of t h e i r land i n t o t h e UCPs. However, numerous Tunisian sources interviewed by OED, including government o f f i c i a l s , scholars, farm-level cooperative o f f i c a l s , and p r i v a t e farmers who were formerly cooperateurs, now agree t h a t t h e s m a l l farmers were, i n f a c t , generally not receptive t o giving up t h e i r land and f e l t t h a t I t l a l i b e r t e " and "l'attachement a l a t e r r e " were much more important than the p o s s i b i l i t y of earning an income of D 250. Many, however, had been prepared t o s a c r i f i c e f o r the nation, a t the behest of the President, and would have been willing t o reduce t h e i r incomes f o r several years i n t h a t s p i r i t if they had been c e r t a i n t h a t t h e cooperative o f f i c i a l s were being honest and f a i r with t h e cooperateurs . The GOT designed and implemented the cooperative program, taldng advantage of t h a t n a t i o n a l i s t i c appeal and i n s p i t e of the fannersf lingering reservations, i n order t o accomplish i t s overall objectives f o r the a g r i c u l t u r a l s e c t o r and f o r the nation as a whole. 2.16 A t t h e time when t h e project design process w a s being i n i t i a t e d , t h e UCPs displayed a poor f h a n c i a l record: in 1964, there w as an aggregate l o s s of D 84,663 ($162,807) and only 28 (29%) of 95 =porting UCPs showed profits. The 95 reporting UCPs represented 65% of t h e t o t a l 146 UCPs.  1 11 . THE PROJECT AND THE LCM/CREDIT: IDWTIE'ICATION , DESIB2 -.-U-A.AL AND APPROVAL 3 .O1 An exploratory mission w as made by a Bank o f f i c i a l in December 1963, but the principal i d e n t i f i c a t i o n work was performed by a four-person FA0 team i n October 1964. The FA0 mission recommended that t h e amount of land t o be organized i n t o new UCPs be reduced from the 800,000 ha requested by the G UT t o 400,000 ha. This mission and two 196.5 FA0 missions emphasized t h e importance of providing adequate t r a i n i n g f o r cooperative d i r e c t o r s and farm technicians; t h e t h i r d mission noted t h e underemployment in t h e existing UCPs and the reluctance of members to bring t h e i r livestock i n t o the coope- . r a t i ves 3.02 There were four Il3RD appraisal missions f o r the U CP project. The f i r s t mission, i n October 195.5, concluded t h a t t h e project was not acceptable i n i t s current form, due t o t h e low economic r a t e of return (7.5% over 30 years the inadequacy of management, and t h e i n a b i l i t y t o f'ully employ the planned membership. A January 1966 mission, sent t o evaluate t h e f e a s i b i l i t y of intensifying livestock production i n the cooperatives, proposed a modification of the main innovation included i n the p r o j e c t design: t h e a l t e r a t i o n of the normal rotation system of wheat c u l t i v a t i o n and fallow, w i t h the replacement of the fallow by the production of forage crops f o r s a l e outside t h e coopera- tives. The mission recommended that these forage crops be retained by the UCPs f o r t h e u t i l i z a t i o n of their own livestock; this could provide a basis both f o r the i n t e n s i f i c a t i o n and t h e amelioration of livestock production. The projected returns from the s a l e s of livestock products w a s expected t o increase the economic r a t e a ? return t o an acceptable l e v e l - 10% over 24 years. In addition, because of t h e labor i n p u t required by the i n t e n s i f i e d livestock operations, this scheme w as seen as a solution t o the underemploy- ment of U CP members. The f i n a l appraisal mission in June 1966 recommended t h a t the expected management shortage be a l l e v i a t e d by the h i r i n g of large numbers of experienced foreign nationals t o serve as U CP directors. The GOT rejected t h i s option because i t w as p o l i t i c a l l y infeasible, but agreed t o h i r e a limited number of foreign technicians as cooperative advisors. The last appraisal mission a l s o recommended t h e establishment o f a special organization attached t o the Under S e c r e t a r i a t f o r Agriculture, a Bureau of Control (BC), t o consolidate and rationalize the administration of t h e U C P system, t o perform the planning and programming ftmctions, and t o supervise the implementation of t h e U CP project. The BC w a s t o have fill responsibility f o r supervising the management of the UCPs and f o r coordinating t h e farm- l e v e l services provided by the various govemment organizations. The S t a t e lands included i n the project were t o be administered separately by the Office des Terres Domaniales (OTD), a semi-autonomous public agency loosely attached also t o the Under S e c r e t a r i a t f o r Agriculture. The OTD w as responsible f o r the management of all S t a t e land i n Tunisia. 3.03 The a p p r a i s a l report, which w as i s s u e d i n January 1947, s p e c i f i e d t h a t t h e loan/credit i b d s we^ t o be divided among t h e e x i s t i n g UCPs ($4.2 million, 23%), t h e new UCPs ($1 1 .6 million, 65%), and t h e S t a t e farms ($2.2 million, 12%) (annex 6 ) . H a l f of t h e funds f o r t h e e x i s t i n g UCPs were f o r t h e construction of fm buildings, mainly f o r c e n t r a l i z e d l i v e - stock production, and t h e ~ m a i n d e r was t o be spent on miscellaneous farm machinery and small-scale i r r i g a t i o n equipment. For t h e new UCPs, S& of t h e funds was intended f o r t h e purchase of large-scale mechanized grain production and harvesting equipment and forage harvesting equipment; 21% w as t o be spent on small-scale i r r i g a t i o n equipment and t h e remainder w a s a l l o c a t e d f o r farm buildings, imported livestock, and t e c h n i c a l a s s i s t a n c e . A l l of t h e funds f o r t h e S t a t e fanus were designated f o r t h e replacement of f a r m machinery. 3 004 Half of t h e technical a s s i s t a n c e funds were a l l o c a t e d f o r t h e development of f e a s i b i l i t y s t u d i e s f o r t h e new UCPs, s t u d i e s t o be prepared by t h e BC s t a f f with t h e a s s i s t a n c e o f f o r e i g n consultants. The remaining S@ of t h e technical a s s i s t a n c e funds were f o r t h e s a l a r i e s and expenses of t h e e x p a t r i a t e advisors who, with t h e i r Tunisian counterparts, were t o serve as t h e core s t a f f of t h e E ! during t h e i n i t i a l years of t h e p r o j e c t . C 3-05 P r o j e c t funds would be l e n t t o i n d i v i d u a l UCPs, The funds were t o be channelled through t h e Banque Nationale Agricole (BNA), a semi-public organization which handled t h e maJ o r i t y of T u n i s i a ' s a g r i c u l t u r a l c r e d i t . The BNA, which w as t o administer t h e loans t o both t h e UCPs and t h e S t a t e farms, could a c t only with t h e appmval of t h e BC, which recommended t h e appropriate l e v e l of f'inancing t o t h e BNA. The loans were t o c a r r y an i n t e r e s t r a t e of 6% p e r annum, with an average term of 1 3 years and a grace period of f o u r years f o r t h e UCPs, and a m a x i m u m term of f i v e years and no grace period f o r t h e S t a t e farms. The B N A l s r o l e was hardly a passive one, h m v e r . A s discussed in para 8.14, t h e s p e c i a l p r o j e c t u n i t within t h e BW provided an important f a c i l i t y f o r i n v e s t i g a t i o n and a n a l y s i s of, and an e a r l y warning system on, t h e f i n a n c i a l v i a b i l i t y of individual UCPs . 3.06 The main f i n a n c i a l assumptions and t h e income and cash flow projected f o r t h e UCPs are o u t l i n e d i n annexes 7 and 8. These p r o j e c t i o n s were based on two main t e c h n i c a l ooncepts: (1 ) t h e w h e a t / f ~ r a g e / ~ u l s e r o t a t i o n scheme, w i t h the elimination o r reduction of fallow; and ( 2 ) i n t e n s i f i e d l i v e s t o c k production, with t h e improvement of l o c a l herds (mainly through breeding with imported animals), t h e elimination of open grazing on fallowed lands, and t h e introduction of improved feeds. 3.07 The a p p r a i s a l r e p o r t concluded t h a t t h e p m j e c t was t e c h n i c a l l y f e a s i b l e and economically j u s t i f i e d , provided t h a t it would be implemented according t o t h e p l a n recommended by t h e Bank and agreed t o by t h e GOT. 3.08 When t h e p r o j e c t was presented t o t h e Board of Executive Directors, they expressed t h e i r concern about t h e adequacy of management, supervision and administration f o r t h e UCP system. Other e x i s t i n g problems were c i t e d , ngne of which were t o be quickly resolved: the apparent confusion between s o c i a l , ideological and economic considerations i n the planning of t h e coop2r,;,. res; the over-centralization of decision-making and the lack of member-partici- pation in t h e process; the f a c t t h a t p a r t i c i p a t i o n was not voluntary; the lack of incentives f o r t h e workers, t h e i r families, and t h e farm directors; t h e reluctance of farmers to gLve up ownership of t h e i r land, a n b d s and small equipment and t h e absence of motivation f a c t o r s t o overcome this reluctance; and t h e questionable labor-absorbing capacity of t h e UCPs. 3 -09 Nevertheless, t h e general lane of t h e Board discussion w as opti- mistic. The p r o j e c t was viewed a s '%uportant" and a "new directionm f o r the Bank because of i t s focus on marginal farmers, and i t w as termed "unusual", and "creativer1, p a r t l y because i t involved a State-owned enterprise. Bank s t a f f could argue t h a t because of t n e GOT'S f i r m commitment t o t h e UCPs, the program offered t h e only option f o r Bank p a r t i c i p a t i o n in t h e development of Tunisia's productive ~ , ~ r b c ' ~ l + i ~ ~ r a l Bank o f f i c i a l s hoped t h a t the lands. Bank's p a r t i c i p a t i o n would a s s i s t in making t h e cooperative program more r a t i o n a l , more r e a l i s t i c and more p r o f i t a b l e . Also, it w as thought t h a t the GOT could n o t be persuaded t o f u r t h e r a l t e r any s i g n i f i c a n t f e a t u r e s of the project; the opinion in Washington w a s t h a t t h e GOT had been extremely p a t i e n t and f l e x i b l e , but would probably not accept any f'urther attempts t o reduce t h e scope o r r a t e of expansion. Yet another argument f o r Bank participatim w a s i t s i n t e r n s t i n developing general s t r a t e g i e s t o eliminate subsistence farming: it w a s f e l t t h a t the Tunisian program, p a r t i c u l a r l y the use of production cooperatives, would be of p a r t i c u l a r i n t e r e s t t o o t h e r Bank borrowers and t h a t t h e p r o j e c t w as a means of developing Bank expertise i n these areas. Records a l s o show a c e r t a i n hesitancy t o r e j e c t t h e project, because such action would contribute t o an image of t h e Bank a s an ideologi- c a l l y conservative o r risk-averse organization . Finally, one can detect in t h e f i l e s some reluctance t o abandon a p r o j e c t a f t e r having spent 2 1 / 2 years in planning and appraisal. 3.10 The agreement wa , s signed on February 21 1967, and the p m j e c t became e f f e c t i v e on July 3, 1967. The period of time from t h e i r i i t i a l p r o j e c t iden- t i f i c a t i o n mission (~ecember1963) u n t i l the date of effectiveness was over 3.5 years and the e n t i r e process involved e i g h t missions t o Tunisia (annex 17). 3.1 1 The p m j e c t has a d i s t i n c t h i s t o r i c a l position in the Bank's port- folio: (1 ) it was one of t h e first undertaken by t h e Bank .in support of a national development program based on c o l l e c t i v e concepts, r a t h e r than private enterprise; ( 2 ) it was the first involving a large Bank loan f o r cooperatives, and t h e first involving a loan of any s i z e f o r production cooperatives; and (3) it was one of the few projects, i f not t h e first, whose primary bene- factors were t o be t h e small subsistence farmers and l a n d l e s s r u r a l workers.  1MPZrEMb;NTATIONAM) REVISION OF THE ORIGINAL PROJECT A. Pro.iect Costs and Disbursements 4.01 The p r o j e c t and loan/credit categories which w e r e planned f o r the original UCP p r o j e c t are outllned i n columns 1-4 of t a b l e 1. 4.02 About 38% of t h e t o t a l p m j e c t c o s t s we= used f o r foreign exchange expenditures, of which 80% were t o be financed by Bank/IDA funding. The GOT contribution t o t h e p r o j e c t t o t a l l e d $14.6 million, 45% of t h e t o t a l c o s t of t h e p r o j e c t (annex 6). Table 1 Planned and Actual Funding Categories of the Original Project and t h e L o a d c r e d i t (US$ m i l l i o n s ) Planned Actual Percent Loan/ Total Percent Bank/1D~ of Credit Project of Loan/ Loan/ Disburse- as % costs Pro e c t Credit Credit ments Planned T+TT 70 Farm Buildings 0.170 4.9 Farm Machinery 5.151 53.7 I r r i g a t i o n Equipment Imported Livestock Technical Assistance F e a s i b i l i t y Studies Technical Services Other Local Fkpense 8 Total 32.500 100.0 18.000 100.0 6.037 33.5 -- -- -. - -- h -03 After t h e signing of t h e l o a d c r e d i t , its effectiveness was delayed f o r almost f i v e months, primarily because of problems in organizing and i n i - t i a t i n g t h e operations of the BC. S t a f f selection, p a r t i c u l a r l y t h e re- cruitment of t h e nine e x p a t r i a t e s who were t o advise t h e Bureau, proved t o be more time-consuming and d i f f i c u l t than expected. A s a result, t h e preparation of t h e f e a s i b i l i t y s t u d i e s f o r t h e new cooperatives and t h e bidding documents f o r t h e farm machinery and i r r i g a t i o n equipment could n o t be comp- l e t e d according t o schedule. In order t o assist t h e BC with t h e preparation o f t h e s e documents, a mission w as s e n t t o Tunisia in May 1967. 4.a Throughout t h e implementation pe riod of t h e o r i g i n a l p r o j e c t there were continual delays in the disbursement of funds, and by t h e d a t e of t h e revision of the p r o j e c t three years later, when a l l funds were expected t o have been disbursed, cmly 33.5% of the funds of the o r i g i n a l loan/credit had been a c t u a l l y disbursed. The amounts and categories which were a c t u a l l y disbursed under the o r i g i n a l loan/credit are shown i n colum 5 of t a b l e 1 , and t h e comparison with plans i s shown in column 6. 4.05 The reasons f o r the discrepancies between planned and a c t u a l disbursements can be divided i n t o t h r e e main categories: (1 ) d i f f i c u l t i e s i n the development of t h e p r o j e c t ' s administrative system and f a c i l i t i e s ; ( 2 ) delays i n t h e implementation of t h e bidding and procurement a c t i v i t i e s necessary t o obtain o r construct the specific f a c i l i t i e s and equipment which had been planned; and (3) problems in the functioning of t h e cooperative p*g-. 4.06 I n t h e first category, t h e i n i t i a l problem w as t h e s t a f f i n g of t h e BC, a problem exacerbated by a decision i n 1968 to double t h e number of foreign technicians t o 18 and t o h i r e additional Tunisian technicians. The d i f f i c u l t i e s with t h e preparation and analysis of t h e f e a s i b i l i t y studies (farm plans) f o r the consolidation of t h e e x i s t i n g UCPs and t h e creation of new UCPs continued throughout the project. The q u a l i t y of t h e studies w a s often inadequate; they tended t o focus on geographic o r production d e t a i l s , and of ten neglected t o include f i n a n c i a l p m jections substantiating the economic v i a b i l i t y of the plans. In addition, the pmparation and approval of t h e studies w a s always behind schedule; this s i t u a t i o n worsened t o t h e point t h a t in November 1968, when plans were to be suhnitted f o r each of 213 cooperatives, only 38 plans had a c t u a l l y bean pl.epal.ed. The p r e p a r a t i m of f e a s i b i l i t y studies w a s continually delayed by the l a c k of fFnancia1 accounts, which were t o be submitted f o r each cooperative. The UCPs were usually l a t e i n reporting on t h e i r operations, and some f a i l e d t o provide any f i n a n c i a l accounts. For example, by May 1968, only 81 of 34.2 UCPs (24%) had produced f i n a n c i a l accounts f o r 196647, al- though eventually a l l t h e accounts f o r 1966-67 were received (mainly due t o the e f f i c i e n t w r k by BNT i n keeping these accounts). These delays were due mainly t o the severe shortage of available accountants. The Bank repeatedly i n s i s t e d on thorough analyses of t h e technical and economic v i a b i l i t y of each proposed cooperative and of the j u s t i f i c a t i o n of funds f o r t h e eldsking cooperatives; u n t i l these analyses were p p a r e d and approved, t h e m d s were withheld. In additian t o these d i f f i c u l t i e s i n t h e operations of the administrative system, there w a s a l s o a broader admini- s t r a t i v e problem: the lack of authority and autonomy of t h e BC. There w as constant interference i n the a c t i v i t i e s of the Bureau by p o l i t i c i a n s and government o f f i c i a l s . In s p i t e of fmquent recolamendations by t h e Bank staff t h a t t h e power and autonomy of the Bureau be increased in order t o improve i t s a b i l i t y t o make and implement decisions, the Bureau never w as a b l e t o play the f u l l r o l e f o r which i t had been desi-ed. 4.07 The second category of reasons f o r t h e difference between t h e planned and a c t u a l disbursements includes repeated delays i n the bidding and procurement procedures f o r the building construction and farm machinery components of the program. In addition, it became evident e a r l y i n t h e project t h a t it would be necessary t o modify the l o d c r e d i t t o assign funds f o r farm machinery repair f a c i l i t i e s . By January 1969, a plan w as devised whereby $750,000 in savings from the bidding on farm machinery were allocated t o provide 80% of t h e cost of s e t t i n g up limited repair operations. Bidding on these repair f a c i l i t i e s created i t s own s e t of unanticipateddelays. The i r r i g a t i o n component of the l o d c r e d i t also caused problems: there were changes i n t h e GOT plans f o r i r r i g a t i o n and water supply development, as well as delays i n the process of water resource exploration and the design and planning of t h e exact f a c i l i t i e s needed by t h e UCPs . The principal modification provided d i f f e r e n t and expnded f a c i l i t i e s on 1 5 UCPs, and reduced inputs t o 145 others o r i g i n a l l y programmed. Finally, the imple- mentation of the livestock portion of the program w as slowed severely, mainly by the cooperateursl resistance t o bringtng t h e i r livestock i n t o the cooperatives. Expenditures on farm buildings, most of which were planned f o r stables, were postponed. 4 .08 The delays affected spending under d i f f e r e n t categories unequally. The machinery import program w as t h e only component to advance r e l a t i v e l y well, and, a s t a b l e 1 i l l u s t r a t e s , the Bank's principal c a p i t a l contributions t o the o r i g i n a l project were the t r a c t o r s and combines. I f technical assistance i s excluded, 97% of Bank f m d s were disbursed f o r these units. 4-09 The t h i r d category of d i f f i c u l t i e s encountered i n t h e execution of the project includes those associated with the d a i l y fbnctioning of t h e coope- r a t i v e program. They a r e described i n t h e following sections. B. Problems Affecting the Progress of the Cooperatives Program (1 966-1 9681 4.10 Problems encountered i n the functioning of the cooperatives program during Phase I of t h e project, 1966-1968, can be divided i n t o eight related areas: (1 ) technical d i f f i c u l t i e s ; ( 2 ) problems in the managanent of the cooperatives; (3) problems of multiple goals and conflicting o f f i c i a l attitudes; (4) i n s t i t u t i o n a l coordination; (5) deviations from p r o j e c t design; ( 6) shortage of investment f m d s and inadequate physical c a p i t a l base; (7) adverse weather conditions; and (8) the lack of cooperation of many of the cooperateurs. 4.1 1 (1 ) Technical Problems: The fundamental problem with the UCPs was t h e i r scale and complexity; even experienced, well-trained managers and tech- nicians on modem, private Tunisian properties would be challenged by the task of operating 1,000 ha of mechanized farmland which included i r r i g a t e d systems, a variety of crops under new rotation schemes, livestock and dairy operations, and over 80 workers. Virtually no one in Tunisia w as experienced with t h i s scale and type of operation, which was seven times l a r g e r than the average colon ouner-operated farm and w as designed f o r more i n t e n s i f i e d and complex cropping patterns. The technical assistance u n i t in the Under S e c r e t a r i a t f o r Agriculture was s t i l l understaffed. Although the number of available agricultural engineers had increased from one engineer per 54,800 ha in 1962 t o one engineer per 20,000 ha of U CP land - o r oae .?or every 20 UCPs - this l e v e l was s t i l l inadequate f o r the application of the new a g r i c u l t u r a l systems designed f o r the UCPs. A s a result, farm opera- tions were often run in i n e f f i c i e n t and c o s t l y ways. 1/ 4.1 2 It also proved more d i f f i c u l t than expected t o plan and d i r e c t the operations of individual f a m s from BC headquarters: the farm plans, even with the attention of t h e p r o j e c t ' s foreign experts, often reflected l i t t l e knowledge of the p a r t i c u l a r area and sometimes recommended c o s t l y but inappropriate modifications of e x i s t i n g cropping patterns f o r individual UCPs. With the assistance of the TJNDP and b i l a t e r a l donors, the GOT conducted t r a i n i n g programs to increase the number and improve t h e q u a l i t y of fanu technicians, foremen and accountants. However, observers agree t h a t these were r e l a t i v e l y i n e f f e c t i v e i n the short term, mainly due t o the youth and lack of p r a c t i c a l experience of the students, and t h e brevity of the course. 4.1 3 Another serious technical problem concerned t h e maintenance of fanu machinery and equipment. The inability of U CP o f f i c i a l s and members t o make necessary repairs and the shortage of professional r e p a i r f a c i l i t i e s and spa* p a r t s resulted i n considerable delays and losses of e q u i p e n t . For example, observers report it w as not unusual f o r t r a c t o r s with f l a t tires o r dead b a t t e r i e s t o be abandoned because of t h e shortage of spares. The problems stemmed in p a r t from the replacement of private machinery dealers with l e s s e f f i c i e n t government repair shops. L.14 A major proportion of technical assistance funds provided i n t h e Bank loan/credit was desimed t o assist i n the development of the capacity of project personnel t o overcome these technical problems. By October 1967, the nine expatriates f o r whom funds were allocated had arrived in Tunisia. The group included two general farm managers, two livestock s p e c i a l i s t s , two agronomists, an a g r i c u l t u r a l accountant, an agricultural e n b e e r , and an agricultural training specialist. In May 1968, the GOT and the Bank decided t o expand the s t a f f of expatriates t o include an agro-economist, a fann machinem expert, and an i r r i g a t i c n s p e c i a l i s t . The expatriates were expected t o divlde t h e i r time between t h e i r s t a f f f'unctions in the BC and field visits to the individual UCPs. However, i t became necessary f o r the advisers, who l i v e d i n Tunis a t GOT'S request, t o a l l o c a t e the majority of their time t o t h e development of t h e B C f s c a p a b i l i t i e s and t o reduce sig- n i f i c a n t l y the frequency of t h e i r field visits t o the UCPs. Bank o f f i c i a l s 1/ Observers report such practices as t h e frequent over-application of f e r t i l i z e r , the overuse of concentrates i n animal rations, the misuse of milking equipment to the discomfort and annoyance of t h e cows, the cutting and collection of animal feed (clover) f o r indoor consumption when i t could have been consumed d i r e c t l y by the animals outside i n the f i e l d s , and t h e boarding of animals inside buildings when they could have been kept outdoors. reported t h a t because of t h e infrequency of these visits, t h e farm-level impact of expatriates was negligible. L.15 (*I/ - The Manamment of the Cooperatives: Most of the U were young, - KCh only a high school diploma o r even l e s s formal education CP directors and l i t t l e o r no p r a c t i c a l experience i n fanning. Some were chosen largely f o r p o l i t i c a l loyalty, and many were a f r a i d t o take risks o r d j f f e r with l o c a l o r c e n t r a l government authorities f o r f e a r of l o s i n g t h e i r jobs. The directors received fixed s a l a r i e s , which were not dependent on the performance of the cooperatives; thus there w as l i t t l e financial incentive, a reduced sense of responsibility, and no defined penalties f o r poor performmce . Almost no decisions were actually made a t t h e farm level; even minor d a i l y decisions about farm operations and management required t h e approval of higher authorities. This resulted i n constant delays and inefficiencies and thus considerable cost t o the UCPs; directors were a l s o forced t o spend a significant portion of t h e i r time communicating with the numerous layers of government o f f i c i a l s , rather than focusing on the operations of t h e farm. Another major p a r t of t h e directors' time was spent i n compiling detailed data, much of which was never used, and i n completing the extensive paper work required by the BC. L.16 I n an attempt t o improve t h e q u a l i t y of UCP management, i n 1966 the GOT established the National School f o r Cooperatives, which providcd L one-year t r a i n i n g course in accounting and farming s k i l l s f o r UCP directors. Observers report t h e faculty, students, and cumiculun of the school were not of t h e highest quality; however, it i s questionable whether any one- year course could have provided these young, inexperienced students with adequate skills t o manage t h e complex operations of the UCPs, and i n any case many of the management bottlenecks had t o be resolved a t a higher level. b.18 ( 3 ) Multiple Goals: The flurdamental problem in this categorg w as the influence exerted over progrant p r i o r i t i e s by many top government o f f i c i a l s , and the e f f e c t of t h e i r decisionsonthe administration of the U C P program. By the l a t e 1960s, the ideological objectives of the coopera- t i v e s program superseded the economic considerations, and the UCPs were charged w i t h various p o l i t i c a l , social and welfare responsibilities, such a s the employment of surplus 1 bor, which they were not technically o r financially able t o fulW1. 9 Some o f f i c i a l s viewed t h e formation of I n 1968, 85%were l e s s than 25 years old. Ben Salem, p. 1k2- 2/ For example, one cooperative which was studied i n 1967 had been designed t o support 11 5 cooperateurs, but the actual number of workers assigned was 180, a 56% increase; the proportion of surplus workers was often greater i n 1968 and 1 969. cooperatives as an end i n i t s e l f , and the number of units created, regardless of t h e i r performance, seemed t o have been taken as t h e c r u c i a l i n d i c a t o r of pmgress. A s a result, program expansion w as accelemted several ti~lhes without adequate justification, planning o r preparation. Furthemom, while p r e c i s e goals were c a r e f u l l y specified, concrete plans f o r t h e achieve- ment of these goals were r a r e l y formulated. Some o f f i c i a l s a l s o reportedly demonstrated a r a t h e r condescending and p a t e r n a l i s t i c a t t i t u d e towards r u r a l workers and small farmers; this a t t i t u d e prevented t h e U C P system from e f f e c t i v e l y u t i l i z i n g the knowledge and experience of the cooperateurs and also caused some of them t o develop negative a t t i t u d e s towards the UCPs. 4-19 (4) InstitutionalCoordination: I n s p i t e of t h e attempt t o r a t i o n a l i z e and s b l i f ' y the decision-making pmcess of t h e U CP s y s t e m by the establishment o? the BC, t h e process r e a e d complex and r i g i d , with c o s t l y delays reflected a t farm level. The process i t s e l f of establishing the BC created new bottlenecks. The delayed recruitment of q u a l i f i e d foreign technicians reduced t h e a b i l i t y of t h e Bureau staff t o provide the expected l e v e l of assistance t o the cooperatives o r t o perform an adequate programming f'unction f o r the U CP system. The Bureau a l s o lacked adequate authority, both a t farm l e v e l and w i t h i n t h e national g o v e m t , because of frequent interferences from p o l i t i c a l and administrative a u t h o r i t i e s , and thus had d i f f i c u l t y in e l i c i t i n g response t o its recommendations and i n achieving cooperation from other organizations. 4.20 ( 5 ) Deviatdons from Project Design: One of the l e a s t successf'ul aspects of the o r i g i n a l p r o j e c t w a s the implementation of the livestock component. The Bank and the GOT developed a scheme whereby t h e farmers were expected t o bring t h e i r c a t t l e i n t o t h e UCP, u i t h t h e returns t o be d i s t r i b u t e d i n the following ways: (1 ) the U CP w a s t o receive ownership of the female calves, which were t o be bred w i t h imported b u l l s in order to upgrade the quaklty of t h e l o c a l breeds; (2) t h e male calves were t o be sold o r slaughtered, with t h e returns accming t o the UCP; and (3) the coopera- t e u r was t o receive a percentage of the milk produced by his cow, and a percentage of the returns from t h e remainder of the m i l k produced. 4.21 The livestock component never functioned as i t w as originally designed; many cooperateurs hid t h e i r animals outside t h e UCPs - on the - farms of r e l a t i v e s , i n i s o l a t e d pastures, e t c . t o prevent t h e i r incor- poration in t h e cooperatives, while others refused to give up a portion of the milk produced o r t h e newborn calves, which were a l s o hidden. Finally, i n 1968, the scheme w a s modified: the UCPs began t o pay the farmsrs f o r t h e i r animals, which then became the sole property of t h e UCP, and gave the farmers the choice of whether o r not to s e l l . 4.22 This f a i l u r e of the livestock component durlng Phase I s i g n i f i - c a n t l y affected t h e t o t a l receipts and financial performance of t h e UCPs. The earnings from the s a l e of livestock products had been projected t o increase from 8% of U C P earnings by t h e end of t h e first year of operation t o 26% during the t h i r d year. However, u n t i l 1971 t h e a c t u a l incremental s a l e s from livestock products (on old and new UCPS) were negligible; thus, a major portion of expected returns w as not realized. 4.23 (6) Shorta o f Lpyestment Funds and hadequate Physical Capital m: --d During the 196 -78 period, the OOT cooperatives program suffered fmm a serious shortage of investment funds, p a r t i c u l a r l y medium and long-term credit. The condition of the physical c a p i t a l base on t h e former colon farms had already severely deteriorated, because a f i e r Tunisia's independence i n 1955 the colons feared the expropriation of t h e i r lands and ceased a l l major investments. The planners o f the cooperatives program had estimated t h a t a t o t a l of D 10,032,184 ($23.9 million) would be necessary f o r buildings, equipment, machinery, and other inputs f o r the 210 UCPs created between 1962 and 1965. However, the BNA wa s only able to make available D 3,835,774 ($9.1 3 million) i n medium and long-term c ~ d i fto r inputs and operations, 38% of t h e t o t a l anticipated c r e d i t requirements. A s a result, the e a r l y UCPs were seriously underequipped and the UCPs organized in 1966-68 began w i t h a highly inadequate physical c a p i t a l base. 4.24 Even a f t e r the Bank loan/credit was approved, t h e UCPs continued to be undercapitalized, due mainly t o delays i n the d e l i v e r i e s of supplies, equipment and machinery, and in t h e disbursement of funds by the Bank, the GOT, and the Banque Nationale de Tunisie (BNT, formerly the BNA) . UCPs created i n 1966-67 did n o t actually be gin t o receive purchased supplies, The equipment and machinery u n t i l e a r l y 1968; as a r e s u l t , the value of inputs f o r crops planted i n 1966-67 w as reduced from the projected D 27 per ha t o D 19 (-3). By l a t e 1968, only 34% of t h e funds planned f o r the planting of crops, and none of the funds intended f o r t h e purchase of livestock under the redesigned livestock component, had been disbursed by the BNT. 4.25 (7) &d_ver_seWeather Conditions: During Phase I of the project Tunisian agriculture suffered fmm severe shortages of r a i n f a l l . From 1966-69, f a l l and spring rains averaged considerably l e s s than the m a n l e v e l fmm 1946-67. It is impossible t o calculate t h e exact e f f e c t of these droughts on agriculture output; however, a comparison of the pattern of r a i n f a l l with wheat output from 1946-59 shows the predictable relationship between the two factors (appendix 18): during the 1966-69 drought, wheat productivity f o r all Tunisia dropped significantly. This data suggests that the adverse weather conditions affected the performance of the UCPs during the i n i t i a l years of the project m d the formative pellod of many of the UCPs . 4.26 (8 ) The React&= of the Cooperate- : By 1968, the cooperateurs uho had originally been a t t r a c t e d b y the income pramises of the UCPs were g d n g discouraged, as the gap between these pmmises and r e a l i t y became 1/ O f D 2,559,087 ($4.9 million) projected f o r crop cultivation, only D 867,306 ($1 -65 million) w as disbursed. Under the redesigned livestock component the GOT planned t o a l l o c a t e D 1,136,270 ($2.2 million) f o r the purchase of l o c a l livestock. evident. Iargely because of the assi-nt of extra workers ;.: the cooperatives, the members averaged only about 13 Ws of work p e r a ' - and were paid l e s s than 15% of the promised income f o r these days. 1 / I n addition, cooperateurs often f a i l e d to receive any allotment of wheat f o r t h e i r own consumption, and, as a consequence, sometimes resorted t o eating seed grain. m e members were a l s o disturbed by t h e lack of d i s t r i b u t i o n of profits; even when p r o f i t s were earned, they were often retained f o r f u t u r e expenditures o r used t o compensate f o r the losses of other cooperatives. These contradictions of the o r i g i n a l promises caused some cooperateurs to f e e l that they were being cheated by the U C P officials o r the Government. F'inally, members were bothered by two additional factors: (1 ) t h e i r i n a b i l i t y t o p a r t i c i p a t e in cooperative decision-making and (2) t h e i r lack of real representation in U C P management, due to the f a c t t h a t t h e presi- dents, who were supposed to be elected by the members, were sometimes appoin- t e d by t h e Government, and t h e d i r e c t o r s sometimes prevented the presidents from meaningful participation in t h e decision-making. These f a c t o r s combined i n i t i a l l y to pmduce feelings of apathy and indifference, and in 1968-69 began t o i n v i t e h o s t i l i t y and resistance. The results were l o s s e s in worker productivity, negligence w i t h equipment, and the t h e f t by the members of produce and equipment, as a s u b s t i t u t e f o r t h e promised earnings. c. - - 1 968 - Reforms of the UCP PEG-- 4-27 A s a r e s u l t of these various problems, by the end of 1968 the f i n a n c i a l position of the U CP program w as precarious. During the year 1967-68, the aggregate losses of a l l cooperatives more than doubled, and only 78 of 330 reporting cooperatives (24%) were p r o f i t a b l e (annex 9). The t o t a l debt and t h e debt in a r r e a r s of the cooperatives w as a l s o increasing s i g n i f i c a n t l y a t this time (annex 10). In order t o reverse the deSeriorating trend, the GOT undertook several major reforms of the U C P program in September 1968. F i r s t , in order t o impmve program coordination and increase t h e authority of t h e BC, the GOT created a National Agricultural ,Commission, composed of the d i r e c t o r s of the various organizations involved in the U CP program. Second, seven management centers, each responsible f o r about 50 UCPs, were created t o assist in analyzing and planning U CP a c t i v i t i e s and to provide c l o s e r guidance t o management and additional extension services. This rep- resented t h e first s u b s t a n t i a l action to c o r r e c t the problems posed by over- centralization. Third, a new i n s t i t u t e f o r the t r a i n i n g of -UCP d i r e c t o r s and accountants was i n i t i a t e d w i t h FA0 assistance; t h e i n s t i t u t e provided two and three-year courses covering a l l aspects of farm management and a g r i - c u l t u r a l technology. The courses included a one -year apprenticeship on a UCP, under t h e p a r t i a l supervision of an expatriate adviser, and courses s p e c i f i c a l l y designed t o t r a i n students f o r t h e administration and implemen- t a t i o n of the U C P program. Fourth, several s h o r t t r a i n i n g sessions were conducted t o improve t h e s I d l l s and morale of the existing U CP d i r e c t o r s and - p - - a- - Instead of 350 m p e r day, cooperateurs reportedly earned about 50 m per day's work; one 1966 study of a U CP revealed workers earning 29 m (6 # ) o r less. Data from Zamiti (1968) and Rich. technicians. F i f t h , a new accounting system w as implemented t o improve accuracy and consistency of the f i n a n c i a l data and i t s u t i l i z a t i o n in t h e planning process. Sixth, an assessment of the U CP project w as initiated i n which t h e operational problems and requirements of each U C P were t o be carefully evaluated i n order t o deternine t h e proper measures t o improve the UCPsl perfonuance and the a t t i t u d e s of t h e cooperateurs. Finally, the GOT requested t h e Bank t o expand the s t a f f of expatriate advisers, mainly t o assist i n the consolidation of the project. By November 1968, three new agro-economists had been hired and three additional agro-economists were being recruited. D . 1969 Policy Changes 4.28 Several months a f t e r the i n i t i a t i o n of these reforms, and before any sustained improvement could have been expected, a dramatic decision was taken a t t h e highest p o l i t i c a l level. In January 1969, the G OT announced its intention t o accelerate the reform s c edule and bring a l l of Tunisiafs 9 arable land i n t o the cooperative system within the next few years. the first time, the l a n d owned by medium and l a r g e farmers were included For e x p l i c i t l y i n the orders. The lands i n the G0~/Ban.k p r o j e c t area wers t o be increased from 345,000 ha t o 433,000 ha, and t h e Government also planned t o establish 496,000 ha of new UCPs i n northern wheat lands outside the project area. 4.29 Opposition t o flgeneralizationll, the G OT word f o r the accelerated cooperativiaation, grew rapidly, not only among the larger, p o l i t i c a l l y i n f l u e n t i a l farmers, but a l s o among the remaining mall private farmers. They began slaughtering t h e i r livestock and s e l l i n g t h e i r equipment before they could be taken over by cooperatives. This opposition, combined with t h e increasing h o s t i l i t y of the cooperateurs already i n t h e program, w as l a r g e l y responsible f o r t h e Govemmentls decision i n September 1969 t o reverse the policy of expanded, forced cooperativiaation and t o reassure and protect the s a n c t i t y of the establishment of the, p r i v a t e s e c t o r in agriculture. A new l a w w as enacted which stipulated t h a t cooperative participation would be e n t i r e l y voluntary and that confiscated lands would be restored t o former who wished t o leave t h e cooperatives. Within the next few months, O am l le B- formerly private lands were withdrawn from the cooperatives. The land remaining in the UCPs consisted exclusively of S t a t e lands. The cooperateurs who stayed in the UCPs were all former employees of colon/ S t a t e farms o r former landless seasonal workers. E. Project Revision 4.30 The fundamental objective of the GOT in 1970 was t o minimize t h e - 1/ I n December 1968, 38% of Tunisia's cultivable land and 3% of the r u r a l population were incorporated i n t o some type of cooperative o r S t a t e farm. This i s the common allegation, thou& lfalmost a l l " may be a s a f e r statemement t o allow f o r anomalous conditions which may have persuaded a small p e r centage o f owner operators t o s t i c k with the UCP system. disruption of a g r i c u l t u r a l production and resume operations i n t h e most effective way possible. The GOT policy was t o maintain a f l e x i b l e , experimental program which would be revised i f it were not s o c i a l l y acceptable o r economically viable. After considerable debate within the Government it was decided that several d i f f e r e n t types of pmgrams should be conducted. These included t h e following: (1 ) t h e establishment of p i l o t farms on 57,505 ha of S t a t e land i n order t o serve as d e m o n s t ~ t i o n and education centers f o r private farmers; ( 2 ) the establishment of 25 "8gro-combinats" - agro-industrial enterprises - averaging 4,634 ha each on 115,853 ha of S t a t e land throughout t h e country; (3) the organization of s e r d c e cooperatives on about 10,000 ha of S t a t e land uhich m u l d be leased t o private farmers; ( 4 ) the establishment of S t a t e farms on about 200,000 ha of t h e l e s s productive lands, mainly in t h e c e n t e r and the south; and (5) t h e maintenance of production cooperatives ori a b u t 240,OCO ha of S t a t e land in the northern wheat reglons. 4 -31 There were two categories of land which were t o be continued as production cooperatives: (1 ) the 163,000 ha which remained in the original project area a f t e r t h e withdrawal of about 187,000 ha of p r i v a t e land by about 20,000 small fanners; and ( 2 ) 77,000 ha of S t a t e land, forfaerly organized i n t o 220 pre-cooperatives whose membership consisted of about 12,000 former landless laborers. The boundaries of the UCPs were t o be redrawn; t o the extent possible adjacent parcels o f S t a t e land, formerly the nuclei of the UCPs, were t o comprise each new UCP. Some UCPs, including those c.omprising only private land, were dissolved. Since most of the e x i s t i n g UCPs were i d e n t i f i e d with the properties of one o r more individual colons, and since t h a t image would sumive the reorganization, colon workers s t i l l resident on t h e i r o r i g i n a l property might descrlbe the changes of 1969-70 a s events l e s s d r a s t i c than they appear on area maps. 4.32 The GOT requested conanued Bank assistance f o r the revised U CP project, and although the Bank considered withdrawing from the project and cancelling the undisbursed balances, the option w as not favored. The case f o r continued Bank p a r t i c i p a t i o n w as strong. F i r s t , t h e arguments f o r maintaining relative l a r g e fsrm units were s t i l l considered valid, despite the unexpected length of the break-in perlod. Second, the Bank had been r e l a t i v e l y p a t i e n t with repeated violations of previous agreements before September 1969, and Bank o f f i c i a l s thought it i l l o g i c a l and perhaps u n f a i r t o withdraw from t h e project a t t h e time when the GOT w a s c l e a r l y expressing i n t e r e s t s confonaing t o t h e recommendations of the Bank. Third, the project had always been seen as an experiment, which implied a reasonable p o s s i b i l i t y of f a i l u m . For those o f f i c i a l s who f e l t t h a t the p r o j e c t had f a i l e d , no j u s t i f i c a t i o n was seen f o r penallzing e i t h e r t h e country o r t h e project participants, and i t w as i n the i n t e r e s t s of a l l concerned t o proceed quickly i n t o a successor scheme. Fourth, Bank o f f i c i a l s were concerned t h a t the Bank's withdrawal from the U CP pmgram might mean the dismissal of B C t s technical assistance team, an action &ich could have had a serious adverse e f f e c t on the program. Fifth, withdrawal might a l s o be interpreted by the GOT a s adverse Bank reaction t o the dismissal of the former head of t h e UCP program, the Secretary of S t a t e f o r Planning and Economy, and unwarranted interference i n domestic a f f a i r s . Sixth, a few Bank o f f i c i a l s thought it inportant t o protect t h e foreign suppliers who had contracted i n good f a i t h with the GOT under international competitive bidding pmcedures. Seventh, compared w i t h the s i t u a t i o n in 1968-69 the t e n t a t i v e proposals f o r t h e revised project included a smaller number of cooperatives and l e s s land, thus the managerial and administrative problems would be greatly reduced. Eighth, the GOT seemed determined not t o allow p o l i t i c a l interference with the implementation of the r e v i s e d p r o j e c t . Finally, as a result of the experience which had been gained by a l l groups involved in t h e o r i g i n a l project, b e t t e r r e s u l t s were predicted from the revision. 4.33 Thus the Bank n s d s t e d t h e GOT with t h e design of a revised project to meet the objectives and-concerns of both p a r t i e s . The project was approved and t h e revised loan/credit agreements signed on November 23, 1970. The main element of the new p l was t o maintain a g r i c u l t u r a l productivity on 202,000 ha of S t a t e land g r g a n i z e d i n t o 218 cooperatives. Iha o r i g i n a l $1 8.0 million l o a d c r e d i t w as reduced to $9.2 million, and $8.8 million of the original loan/credit f h d s were cancelled. Ihe $9.2 million revised p m ject included $6.0 million of f'unds which had already been disbursed under t h e original project; two-thirds of the $6.0 million were loan funds aud t h e remaining t h i r d w as c m d i t funds. Thus, $3.2 million in additional f h d s were a c t u a l l y t o be disbursed under t h e revised project, including $2.1 million in loans and $1 .I million i n credit. 4-34 The l o a d c r e d i t funds in t h e revised project were t o be allocated f o r i t e m s which were i d e n t i c a l t o the items l i s t e d i n t h e o r i g i n a l project budget with t h e exception of machinery repairs. However, the allocations planned f o r t h e revised project differed from those f o r t h e original project in several ways. The differences a r e broug$t out in t a b l e 2, which gives the planned and actual disbursements i n the o r i g i n a l loan/credit and the t o t a l and increnental disbursements f o r the revised loan/credit. A con- parison of columns 6 and 8 shows (1) t h e substantial mduction in the importance of t r a c t o r s and other new machinery imports - f r o m 85% of actual disbursements t o 9% of planned incremental disbursements - reflecting the f a c t that t h e acquisition of t h i s item had alrea* proceeded as f a r as was necessary f o r the redesigned project; (2) the expanding claim f o r the con- s t r u c t i o n of s t a b l e s and other farm buildings, whose development had lagged severely behind the schedule of the o r i g i n a l p m j e c t plan; and (3) f u r t h e r build-up of the technical assistance component, intended t o support the expanded foreign s t a f f . 4.35 The $9.2 million ~ a n k / I Mfunding f o r the revised project rep- resented 76% of t h e t o t a l costs of the revised project, which equaled 1/ It is not c l e a r what plans were made f o r the r e s t of the 240,000 ha mentioned in para 4.30.  Table 2 Comparison of Disbursements of the Original and Revised ~oan/Credits (US$ Million) Planned Planned Planned Actual Incremental Disbursements % of Original Disbursements % of Revised Disbursements % of Actual Disbursements % of in Original - Planned in Revised Planned in Original Original in Revised ~ncremental Category Loadcredit Disbursements Loan/Credit Disbursements LoanICredit Dfsbursemente Loan/Credit Disbursements (1) (2) (3) (4) (5) (6) (7) (8) Farm Buildings 3.50 19.4% 1.17 12.7% .17 2.8 1.000 31.6% Purchase of Farm Machinery 9.60 53.3% 5.44 59.1% 5.151 89.3 Repair of Farm Machinery Irrigation Equipment 3.40 18.9% .45 5.0% - Imported Livestock 0.10 0.6% .03 0.39. - Technical Assistance 1.40 7.8% 1.65 17.9% .716 Total 18.00 100.0% 9.20 100.0% 6.037 --  V. IMPLEMBJTBTION OF THE REVBED F'RaTECT A. Project Costs and Disbursements 5.01 m e r e was a four-month lapse between p m j e c t agreement and effec- tiveness caused by GOT deleys in furnishing the necessary l e g a l evidence t o verify t h e establishment of the C e n t r a l Bank account f o r the proceeds from the s a l e and t r a n s f e r of the surplus farm machinery and building materials. After the loan/credit became effective, t h e r e were f u r t h e r delays i n t h e &isbursemant of funds, but these were short tern and had no substantial impact on the p m ject. They were the consequence of t h e thorough evaluation process required by t h e Bank f o r each of t h e remaining cooperatives t o determine t h e i r technical and f i n a n c i a l viability, t o measum t h e i r e d s t i n g inventory of equipment, and to ascertain t h e i r exact investment requirements. The completion of t h e evaluations of each cooperative caused a s e r i e s of successive modifications in the l i s t of goods required under t h e proeject. The o r i g i n a l project closing date, March 31, 1972, w a s extended two times, , f i r s t t o December 31 1973 and then t o June 30, 1974. The project was a c t u a l l y closed i n March 1974, d th a l l f'unds f u l l y disbursed. 5.02 were made i n the l i s t o f goods included A s e r i e s of m o d i f i c a ~ o n s i n each of t h e disbursement categories (annex 11 ). The l a r g e s t change, an incmase of $598,000 w a s made i n t h e funding f o r technical and advisoqy services, which was allocated mainly t o i b a n c e extensions in the contracts of t h e several expatriate advisors who remained a f t e r 1971 in the Bureau of Control. The l a r g e s t percentage change, a decrease of 88%, occurred in the categoly f o r farm machinery repairs. This r e f l e c t e d an overestimation of the a v a i l a b i l i t y f r o m t h e dissolved cooperatives of surplus used equipment, f o r which repairs had been anticipated. 5.03 Under the revised project, t h e small livestock component of t h e loan/credit w as f'inally disbursed. After international bidding in September 1971, 27 Tarantais and 12 SchKgtz purebred b u l l s were purchased a t a t o t a l cost of $26,000. By March 1972, the b u l l s had been delivered to 33 coopera- tives, where t h e b u l l s were used i n a program t o upgrade t h e l o c a l dairy c a t t l e , uhich by this time t o t a l l e d about 9,700 head. B . The Functioning of t h e Cooperatives Program, 1970-1 974 5.04 After the 1970 reorganization, two outstanding problems had t o be resolved: the s t a t u s of the Bureau of Control and the shortage of adequate management f o r the UCPs. 5.05 In order t o c l a r i f y the r o l e of the Bureau of Control and t o improve i t s effectiveness i n the implementation of t h e U CP project, the Bureau was b r o u ~ h tunder the d i r e c t authority of O D , which had been managing the S t a t e lands since 1961. The bureau w as t o be administratively and f i n a n c i a l l y autonomous within OTD, an arrangement t h a t was expected t o eliminate all outside interference with t h e Bureau's a c t i v i t i e s as well as strengthen i t s effectiveness. The UCPs w u l d remain the exclusive responsibility of t h e Bureau. A t f i r s t , these changes undermined t h e morale of the Bureau's s t a f f members; l o s s e s which were i n t e n s i f i e d by the vast amount of work necessary t o prepare i n a r e l a t i v e l y short time the detailed evaluations of t h e s t a t u s of the remining cooperatives. Once again, it w as necessary f o r s t a f f niembers t o reduce s i g n i f i c a n t l y t h e frequency of t h e i r f i e l d v i s i t s t o the UCPs. However, a f t e r t h e e=ansionaf,its expatriate and Tunisian technical s t a f f and short-term extensions of t h e contracts of most of t h e expatriate experts a l e a d y i n t h e BC, the Bureau was able t o resume a more active r o l e in technical assistance and f i n a n c i a l control of operations a t the farm level. 5.06 The second important problem w as t h e continuing d i f f i c u l t y of providing competent farm directors. The Bank again suggested t h e h i r i n g of a large number of expatriate technicians t o serve as U CP directors, but this was, i n turn, again rejected as being p o l i t i c a l l y unfeasible. The Bank also suggested t h a t the s i z e of cooperatives be halved to about 500 ha i n order t o simplif'y the management task; t h i s option w a s a l s o =jetted on t h e grounds that i t would double t h e number of directors needed. Instead, i n October 1971, about 90 technicians were seconded to t h e OTD by the Ministrg of Agri- culture t o serve as U CP directors. The action enabled project administrators t o accelerate the reduction of the expatriate advisorg staff, which w as de- creased from 16 members i n 1970 t o 7 members a t t h e end of 1971. By 1973, a l l of the expatriate advisers had l e f t t h e project. 5-07 During t h e years a f t e r 1971 the administration of the cooperatives project impmved- considerably. By 1974, when the loan/credit was closed, t h e system had become a rational, well implemented and effective means f o r cen- t r a l i z e d planning and management of a significant portion of Tunisian agri- c u l t u r a l enterprise . 5.08 Five improvements over t h e conditions p e v a i l i n g i n Phase I can be cited. F i r s t , t h e p a r t i c i p a t i o n of the cooperateurs was made voluntary. This removed a source of antagonism, though it reduced membership t o former colon workers and landless seasonal workers who r e a n in t h e cooperatives by preference. Tunisian Govemnent sources almost unanimously agree that t h e present cooperateurs would choose t o own t h e i r om p l o t s of land i f given the opportunity. They s t a y in t h e UCPs because they lack t h a t choice o r indeed any alternative f o r earning equal -income and because t h e i r present position i s b e t t e r than t h e i r former one. Some remain a l s o in the hope t h a t t h e land w i l l someday be distributed t o the members. 5.09 The second improvement i s t h e incentive system established f o r both the cooperateurs and the directors. Both now receive an assured s a l a r y a s well as returns based on output and p r o f i t s . he regular .l:iment 2- s a l a r i e 3 and benefits, as well as the improved l e v e l of tne ac t l i d -siciients t o the cooperateurs (D 187 average income i n 1970, D 274 i n 1973) has been an important f a c t o r in increasing the membersf s a t i s f a c t i o n with t h e UCPs. Other f a c t o r s include the housing, medical and other s o c i a l benefits which they mceive, as well as the i n c ~ a s e d responsiveness of t h e system t o t h e i r demnds. Members a r e now allowed t o maintain t h e i r own animals in t h e U CP and keep mall gardans, both of which were denied to most cooperateurs during Phases I and I1 and which became additional sources of member dis- satisfaction. 5.10 Membership i n the cooperatives i s closed; the only new members a r e t h e d i r e c t descendants of present cooperateurs. OH) interviews suggest t h a t many landless seasonal workers now outside t h e project would apply to become members of t h e U CP i f given t h a t opportunity. Both unemployed and employed seasonal workers expressed envy of the position of the cooperateurs: even some of t h e workers employed in the more ffmodernnprivate farms reported that they consider the U CP membership a preferable a l t e r n a t i v e to t h e i r own position, due t o the s t a b i l i t y of employment, income levels, and b e t t e r working conditions on the UCPs. 5.11 A t h i r d improvement in Phase III i s in the l e v e l of management of the individual UCP. The management and t r a i n i n g courses developed i n t h e mid- 1960s a r e now producing capable directors, many of w hom qualify a s a g r i c u l t u r a l engineers and spend a one-year apprenticeship on a farm before assuming broader responsibilities. A majority of the present farm directors have entered the system during Phase 1 11 , replacing most of t h e directors who were employed during the first and second phases of the project. ?/ !The directors a r e evaluated continuously and those considered inadequate a r e replaced. Up- grading of U CP management has been accompanied by the gradual s h i f t of res- p o n s i b i l i t y from t h e center to t h e f i e l d . Farm directors a r e now able t o a c t more on t h e i r own i n i t i a t i v e than during Phases I and 1 1 ; f o r example, where- a s directors were formerly required t o have the approval of t h e Bureau f o r expenditures of over D 50, now they a r e f r e e t o make expenditures of up t o D 500 without mference to headquarters. 5.1 2 A fourth improvement i s reported i n the overall planning system administered j o i n t l y by national and regional o f f i c i a l s of OTD and o f f i c i a l s of t h e farms. The new system, a c t u a l l y designed a t t h e end of 1958, has been u D i e c t o r s receive a salary of D 40 p e r month and presidents receive D 1 .I00 per day; both receive other returns which approximately equal t'neir s a l a r i e s . Cooperateurs receive from D -800 t o D 1.400 per day, depending on the degree of technical specialization. The other returns of t h e cooperateurs generally amount t o 30-80% of t h e i r actual salary. - 2/ I n 1974, i n one delegation (region) of UCPs, only two directors had been in t h e i r positions before Phase 111, and 10 had assumed t h e i r positions since 1972. Some of these could have rotated . f r o m other UCPs, but probably most were new entrants into the system. f u r t h e r mfined. It has been accompanied by an increase i n the q u a l i t y and accuracy of the accounting system, as well as t h e g m a t e r a v a i l a b i l i t y of qualified accountants, many of whom a m graduates of t h e t r a i n i n g programs developed durlng the e a r l y years of t h e program. 5.13 Finally, t h e tinancia1 performance of the fams has improved significantly -216 UCPs (90%) reported p r o f i t s i n 1973-74, and only 25 f a m s showed losses. The unprofitable farms were analyzed i n order t o correct t h e factors which had caused these losses. 5-14 A t t h e time of the project closing date in March 1974, there were 241 UCPs with an avera e farm s i z e of 901 ha, a cultivable area of 775 ha, and 46 cooperateurs . fl Information m average s i z e , membemhip, land use and other fann characteristics aggmgated by region, with comparisons of the positions in 1970 and 1973, a r e given in annex 12. 1/ I n 1970, the 21 8 UCPs which had been planned f o r the revised project were - reorganized i n t o 21 6 UCPs; then i n 1972-73, 15,789 ha were added t o the project and 25 new UCPs were created, lowering s l i g h t l y the average UCP area.  VI. PROJECT IMPACT A. Productim s d Productivity 6.O 1 One of t h e fundamental objectives of both t h e ori@.nal and revised projects was t o maintain the l e v e l s of production and productivity f-rmerly achieved on colon lands. m e r e i s no comparable informatLon on production from colon lands both before and a f t e r t h e i r incorporation In the UCPs. Huwever, f a i r l y m l i a b l e d a t a are available on colon cereal yields before 1962, and comparisons w l t h yields of t h e Phase I UCPs provide a tentative measure of t h e trend. The calculations, which re@m an assumption about the performance of p l l v a t e lands brought i n t o the , suggest t h a t colon cereal yields were e i t h e r maintained o r n e a r l y so. f o r some satisfaction, though average colon yields, - ? i T lhis gave ground while --- --twice a s high a s Tunisian yields, were not high by etandards s e t by modern enter- p r i s e in developed countlles, and since U CP yields were c l e a r l y below the best colon performers. The o r i g i n a l UCP farm budgets had projected 30% improvements over average colon yields, and the f a c t t h a t no improvement w as detected r e f l e c t s the management f a i l u r e s and weather conditions des- cribed above. 6.02 Since pre-UCP and Phase I estimates of area cultivated annually f o r each major crop on colon land are not avallable,?j t h e y l e l d estimates cannot be t r a n s l a t e d i n t o production trends, lnsofar as plans c a l l e d f o r a ~duction in fallow, cropping i n t e n s i t i e s should have risen. But plans a l s o called f o r crop diverslflcation, with p a r t i c u l a r emphasis on f o r a g e , s o that a reduction i n area comnitted t o the dominant cereals would not be inconsistent with oversU expansion of cropping area, But t h e production trend f o r a l l Tunisia was declining in the l a t e 1960s, presumably r e f l e c t i n g l J The calculations a r e based on y i e l d values given i n annex 13. Yields of colon lands and Tunisian lands are wei&ted approximately 40$/60$ t o r e f l e c t t h e proportional representation of these two categories i n t o t a l U CP holdings i n 1968. It i s assumed t h a t marghal private lands incor- porated i n t o the UCPs had lower yields before the merger than the average yield f o r all Tunisian farms. W i t h the simple proportions j u s t stated, and others given in footnote 3 t o annex 13 , t h e assertion that colon land wheat y i e l d s were maintained can be made, plovlded incorporated marginal lands had yields i n 1967-68 8 0 - 9 s of a l l (northern) Tunisian yields, The arithmetic is simple, but t h e r e l i a b i l i t y of the data i s suspect. A s a f e r formulation of the r e s u l t s of t h e calculation might be t h a t t h e available figures are not consistent w i t h the hypothesis t h a t U C P yields deteriorated a t r a t e s faster than average Tunisian yields. 2/ Undigested data are undoubtedly available on some UCPs o r i n storage at OTD headquarters. It should be pointed out that y i e l d and area s t a t i s t i c s f o r UCPs in Phase I a r e extremely scarce, a t l e a s t in the Bank's f i l e s and the basic l i t e r a t u r e on the UCP program available i n Tunisia. All evidence presented here must be t m a t e d cautiously. in part the poor rainfall pattern, and, as one of its consequences, a f a i l u r e t o c u l t i v a t e l e s s favored parcels. Thus, t o t a l cmpped area on colon lands may have dropped, despite plans t o increase cropping i n t e n s i t i e s . One writer has reported a 36%decrease i n cultivated area, and a 34%decrease i n cereal production, i n IAe North as a whole, between the perlods 1953-56 and 1966-69, and sug e s t s t h a t the U CP performance was no b e t t e r than that and probably worse. A senior b i l a t e r a l a i d o f f i c i a l who travelled widely i n the area in the l a t e 1960s supports that view, suggesting that because of poor manage- ment and the absence of incentives t h e UCPs often planted l e s s , planted l a t e , and harvested fewer hectares than t h e colons o r modem !i'unisian farmers, on comparable high quality land, would have done, i n perlods of drought. But the audit found no hard evidence t o corroborate t h e opinion that the U CP decline i n cultivated area w a s more rapid than t h e regional trend. More- over, there i s a basis t o argue that t h e UCPs probably planted a l a r g e p a r t - of t h e cultivable area and i n f a c t did b e t t e r than the regional trend j u s t - c i t e d even thou& they may have planted some area l a t e r than advised and f a i l e d t o harvest as much on t h e planted area as was reasonably expected. . There i s no consistent and r e l i a b l e infonnation on this important s e t of va rlable s 6.03 The data a r e more conclusive f o r Phase 111, when t h e UCPs were composed primadly of former colon lands, combined with some previously un- cultivated comunal (habous) lands. A s annexes 13 and 1 4 show, t h e approd- mate y i e l d s achieved by the colon fanns and the Phase I 11 UCPs were as follows: Table 3 Comparison of Average Yields Azhieved bxColon Fams and Phase I11 UCPs --A- (9G) Hard Wheat S o f t Wheat Barley Colon Farms, 1950-62 Phase I11 UCPs, 1970-74 10.9 12.1 . 9 8 12.5 9.7 12.5 % hcrease 11% 28% 28% The audit collected no infomation on cropping i n t e n s i t i e s on colon land i n Phase 111, but it seems s a f e t o assme that they are hi&er, and possibly substantially higher, than in the pre-UCP period. 6.04 Thus, productivity and production l e v e l s on colon lands most l i k e l y were s t a b i l i z e d o r deteriorated s l i g h t l y during Phase I of t h e project - with respect t o what the average colon would have done in periods of p o l i t i c a l - calm but were d e f i n i t e l y raised during Phase 111. Simmons, Part 2, page 48. 6.05 Another major objective of the o r i g i n a l project w as t o improve productivity of t h e marginal private lands incorporated i n t o the UqP .r ,L t o thereby eliminate subsistence farming. N o separate data were recorded f o r these lands as d i s t i n c t f r o m t h e colon/State lands i n the UCPs, and the analysis referred t o i n paragraphs 6.01 and 6.02 i s inconclusive on this point also. Ou r best guess i s that while t h e p r i v a t e lands were i n the project, some increase i n yields thereon w as experienced, r e f l e c t i n g the application of improved techniques t o r e l a t i v e l y i n e f f i c i e n t smallholder systems. Since t h e smallholders t y p i c a l l y occupied t h e l e s s f e r t i l e land, often t h e h i l l i e r o r d r i e r regions, while t h e colon nuclei of t h e U C P occupied the land b e t t e r favored d th respect to water, in a sustained period of drought one would q e c t the smallholders t o be t h e first t o be forced t o abandon cultivation of some f i e l d s . If t h e same marginal land had been absorbed within the UCP, however, t h e r a t e at which it w a s taken out of production would be slowed. For one thing, t h e U CP operators would have t h e mechanized equipment necessary t o plough hard s o i l . But it has also been argued that t h e incentive f o r private smallholders t o keep marginal land in production w as stronger than the incentive f o r U C P directors and m r k e r s , f o r reasons &van above, and thus that the marginal private lands incorporated i n t o t h e UCPs may have gone out of production more rapidly. Obviously the weather f a c t o r v a s t l y complicates an analysis of d i f f e r e n t i a l incentives that i s d i f f i c u l t enough already1 The s a f e s t course i s t o s t a t e that w e j u s t do not h a w what happened on t h i s smallholder, marginal property. The objective of improvfng p m d u c t i v i t y and eliminating subsistence fanning w as abandoned, of course, when t h e project was revised and p r i v a t e lands withdrawn . 6.06 Another negative e f f e c t of the U C P program on cereal production has been suggested -a l s o impossible t o v e r i f y o r measure. The regional decline i n cultivated area and production is alleged to be due p a r t l y t o decisions by sane private Tunisian fanners outside t h e cooperative peri- meters - fanners l a r g e and small - t o reduce farm a c t i v i t y i n anticipation of eventual collectivization, an a t t i t u d e that reached h i @ pitch, in some areas, a t t h e end of 1968 and e a r l y 1969. This f a c t o r i s independent of t h e weather effect. It i s referred to again with similar pernicious r e s u l t s of Phase I i n paragraph 6.1 7. 6.07 A t h i r d basic project objective was to diversify production on t h e lands included i n the UCPs. I n 1966, the only important commercial crops produced on the U CP lands were hard and s o f t wheat and barley. During Phase I, some crop d i v e r s i f i c a t i o n occurred, but a t r a t e s much slower than projected i n the appraisal report. During Fhase 111, however, the r a t e of diversification accelerated and by 1974 the farming p a t t e r n in the UCPs had been s i g n i f i c a n t l y changed. A t the present time the UCPs a r e producing a wide v a r i e t y of new crops, including forage, legumes, vegetables, i n d u s t r i a l crops and f-ts, including c i t m s , peaches, apricots and olives (annex 15). Some of these crops were e n t i r e l y new t o the farms. Pork and poultry opera- tions have been developed by the UCPs, and processing plants have been i n s t a l l e d f o r the production of olive o i l , animal feed concentrates and milk products, i n c l u d n g butter, cheese, and yoghurt. 6.08 A fourth objective, which w a s eventually realized during Phase III of t h e project, was the intensification of livestock and livestock products, and t h e improvement of the l o c a l herd. The c a t t l e and sheep herds of t h e UCPs were expanded rapidly a f t e r t h e 1968 modifications in the livestock component, since animal p d c e s were depressed then by forced s a l e s from farmers anticipating collectivation, and the UCPs were permitted t o purchase. By August 1973, the U CP herds included 10,000 caws and 70,000 ewes. The volume of animal products sold d u r h g Phase 1 11w a s considerably below apprais 1 report pro j e c t i m s , but s a l e s increased s t e a d i l y each year a f t e r 1969. la9 The quality of t h e l o c a l c a t t l e herds i n t h e U CP is a l s o said to have imploved s i g n i f i c a n t l y a s a r e s u l t of t h e project innovations. One concrete i n d i c a t o r of t h i s improvement i s the weight d f f e r e n t i a l between U CP c a t t l e and average Tunisian c a t t l e : in 1973, the weight of the s e r a g e U C P c a t t l e at the age of slaughter exceeded t h e national average weight by 29%. The increasing s a l e s of livestock products and this improvement of l o c a l c a t t l e herds has l e d observers to conclude t h a t t h e livestock component w as one of t h e most successful aspects of the revised U CP project. Further- more, the new forage/wheat rotation technology introduced by t h e p r o j e c t i s s t i l l being practiced by many small farmers who were formerly cooperateurs, and other farmers have copied this technology. P a r t l y because of this demonstration effect, it i s generally agreed t h a t the U CP project has made a significant c o n t r i b u t i m t o the r e s t of t h e Tunisian a g r i c u l t u r a l sector. B. Eqyity and Employment 6.09 The average cash income of tkre active cooperateurs remained a t an astonishingly low l e v e l thraughout Phase I, usually f s l l i n g below D 20 per annum (US$bO). s In Phase 111, u i t h a smaller workin force, it began a drama- t i c increase, reaching D 274 in 1972-73 (annex 16). This figure surpassed the original project income t a r g e t of D 250 p e r cooperateur, calculated t o be reached within six t o eight years (1973-75). 2/ I n addition t o t h i s income and t h e wheat allocations, cooperateurs generally receive other benefits and services such as improved housing and health and education programs. The twin objectives of preserving permanent jobs f o r the former employees of the I/ Sales of livestock products i n 1972-73 averaged D 7,557 per UCP. This represents 71% of t h e l e v e l projected f o r t h e fourth year of operations (assuming 1969 t o be the f i r s t p a r ) o r 91% of the l e v e l pmjected f o r the t h i r d year (assuming 1970 t o be t h e first year of actual operations). Prices of livestock products i n 1973 were approxLnately twice those i n 1967. From 1966-73 t h e r e t a i l prices were estimated t o haw increased 25%. 2/ The rapid achievement of this income objective conceals the hardships encountered by cooperateurs during 1967-69, when many reportedly could not afford t o buy food and were forced t o s t e a l seeds from the UCPs o r t o catch wild animals f o r t h e i r families ' food (see Z a m i t i , 1968). colon, and of providing permanent work t o ex-seasonal laborers, were also realized in part. The t o t a l number of workers employed per farm shifted throughout the period: rising during Phase I and f a l l i n g back in Phase III. Fxpressing t h e r a t i o as hectares per cooperateur, annex 3 shows that from 1962-68 the UCPs allocated an average of 12.5 ha of land per coopemteur, but during Phase III t h i s amount w as increased t o 21 .7 ha, o r by 7@. The employment levels which were maintained during Phase 1 11 were signifir.nn.tly lower than i n i t i a l l y expected. Priority was given t o former colon workers, most of whom were offered employment. Some seasonal workers remain in the UCPs, but they formed the majority of the Phase I UCP work force which was released between 1 969 and 1 974 (in addition t o the private farmers). 6.1 0 It is d i f f i c u l t t o assess the real financial performance of the UCPs durlng the early years of the project. Annex 9 presents the o f f i c i a l record of the performance of the UCPs, but it k s generally acknowledged by Tunisian o f f i c i a l s t h a t the actual results dulling mase I were l e s s positive than stated i n these records. During Phase 11, a f t e r the 1968 administrative ref oms, the results a r e considered more accurate, and s t a r t i n g in 1970 the records are considered t o be highly reliable. 6.1 1 The mcords show a large aggregate l o s s in 1966-67 which doubled the following year. The percentage of unprofitable UCPs increased from 66% t o 75%. The figure may understate t h e t o t a l l o s s and the percentage of losing operations because, a s was revealed during the audit, the cost accounts do not include debt service. In 1968-69, however, despite the problems i n the aglicultural sector, there was a dramatic improvem t i n prof'its. !be proportion of unprofitable UCPs decreased t o 28%. ! ?This improvement is generally attributed t o the 1968 reforms. During Phase I I I the financial position of the UCPs continued t o improve: an average of 78% of the UCPs were profitable each year, and t h e overall positive balance f o r a l l UCPs grew at an avemge r a t e of 2% per year. 6.12 The recent financfal record of the UCPs i s actually b e t t e r than the appraisal report predicted. !be appraisal projections f o r a representative UCP do not forecast arrival a t a point where substantial p r o f i t s are reported annuallyuntil year 13. ?he lleportmakes no prediction of the variance of financial perfomnce of individual UCPs around the avemge, but since the model results were treated a s indicative of overall project performance, we must assume that the losses reported by some UCPs should have been offset by surpluses reported by others. Thus, the aggregate losses during Phases 1/ Fewer UCPs submitted accounts i n 1968-69 than in the previous year, but even if a l l the unreporting UCPs had shown losses, the proportion of unprofitable UCPs would have been k5%, s t i l l a marked improvement over the 75% in 1967-68. I and I1 suggest t h a t t h e m a n c i a 1 r e s u l t s were much l e s s successful than the appraisal report had projected, but by the same reasoning the aggregate p r o f i t s materializing e a r l y i n Phase 111 m f l e c t a more successf'ul project performance than expected. 5.1 3 Fmm interviews, it i s c l e a r t h a t t h e expectations of t h e appraisal team were l e s s optimistic about t h e short-run financial s i t u a t i o n of the UCPs than t h e quantitative projections included i n the model i n t h e appraisal report. Some of t h e Bank s t a f f associated with the project during pmparation claim t h a t they expected a l a r g e proportion of the UCPs t o be unprofitable during the e a r l y years. The substantial l o s s e s registered by the UCPs during Phase I thus may not have been much worse than a c t u a l l y predicted by Bank o f f i c i a l s involved. D . I n s t i t u t i o n a l Development 6.14 The o r i g i n a l project aimed t o Itcreatelt 160 new UCPs and ttconsolidatelt 210 e x i s t i n g ones. I n Phase I11 the main p r o j e c t objective was t o nmaintainlt the 21 8 reorganized UCPs. It was n o t possible in t h e audit to match the reorganized units with those e x i s t i n g when t h e pm j e c t began, and thus t o determine &ether a l a r g e number of t h e 21 8 are e a s i l y recognized among t h e orlginal 210. Some scrambling had t o occur, t o r e f l e c t (1 ) t h e l o s s of private lands, (2) access to new S t a t e land, (3) preservation of the 1,000 ha mean s i z e in Phase 1 1 1, and (4) t h e attempt t o achieve s p a t i a l continuity. But the nucleus of t h e original UCPs would have in most cases survived. 6.1 5 The first impression of i n s t i t u t i c n a l progress a t the UCP l e v e l in - Phases I and I1 an impression of f a i l u r e - i s misleading. Despite t h e i r d i f f i c u l t i e s , which no one attempts t o minimize, and p a r t l y as a consequence of the 1968 s e t of reforms, the UCPs by e a r l y 1969 had begun to straighten out t h e i r a f f a i r s . Five years l a t e r , t h e business of t h e 218 old and re- constituted units s t i l l in operation w as looking quite healthy and b e t t e r than the pre-project group. The discouraging performance of the init'ial U CP period i s due i n p a r t t o the extraordinary factors, already l i s t e d , which weakened the government's e f f o r t t o blend private land with State land. But it can a l s o be explained in p a r t a s simply the result of t h e inevitable uncertainties and discouragements of a d i f f i c u l t start-up period - a period much longer than the Tunisians had anticipated. 6.16 There a r e f i v e specific areas i n which i n s t i t u t i o n a l development w a s successfully promoted by the U CP project and pmgram. F i r s t , by t h e end of 1970 the system had c l e a r l y developed an adequate number of d i r e c t o r s f o r the e f f e c t i v e management of t h e individual UCPs. During Phase 11.t h e q u a l i t y of the d r e c t o r s improved further, as t h e graduates of the GOT/FAO i n s t i t u t e and other t r a i n i n g schools began t o join t h e program. Second, t h e q u a l i t y of the accountants and technicians worIdng a t t h e farm l e v e l and i n s t a f f positims w as a l s o remarkably improved during Phase 111. Third, one must c i t e separately the development of the various t r a i n i n g i n s t i t u t e s by t h e GOT and several international and b i l a t e r a l donors; a f t e r 1971, most of t h e directors accountants, technicians and younger o f f i c i a l s in s t a f f positions were graduates of these programs, which uere a t t r a c t i n g i n t e l l i g e n t , talermted, and dedicated students. After the departure of t h e expatriate p r o j e c t s t a f f , and a f t e r t h e termination of t h e p m j e c t i t s e l f , these i n s t i t u t e s continue t o be the main source of managerial and technical personnel f o r t h e development of the Tunisian public a g r i c u l t u r a l sector. A fourth contri- bution of the project t o i n s t i t u t i o n a l development w a s the consolidation and zstionalization of the U CP program's administrative system through the creation and development of t h e Bureau of Control. During Phases I and I1 of t h e project, Tunisian o f f i c i a l s were so impressed by t h e Bureau's per- fonaance that sirailar organizations were created f o r the administration of the cooperatives outside the p r o j e c t area. After the 1970 merger of t h e BC with OTD, the planning, pmgramming and other management systems developed by the BC f o r the UCPs uere adopted by t h e various other programs administered by OTD. By 1975, the BC had p r a c t i c a l l y l o s t i t s i d e n t i t y within the OTD, b u t i n a sense the BC system has really taken over many of t h e OTD offices. Finally, t h e experience gained from participation in the U CP program has contributed s i g n i f i c a n t l y t o t h e effectiveness of GOT o f f i c i a l s in planning am ! implementing development p m j e c t s in numerous government organizations. E. Other Program Impact 6.1 7 During 1968-69 the t h r e a t of the extension of involuntary coopera- t i v i z a t i o n caused d i s r q t i o n s throughout the a g r i c u l t u r a l sector. For example, there w as n e t disinvestment among private farmers, most of whom ceased new investments altogether. Some fanners with savings stopped planting o r even harvesting their crops, fearlng the confYscation of output. I./ ? ~ e price of livestock a l s o dropped s i ~ i f i c a n t l y during 1969, because of attempts t o s e l l animals before they could be incorporated i n t o the UCPs; in some areas of t h e north t h e p r i c e of cows dropped fran D 90 t o D 60 and much more severe price decreases were occasionally reported. 5.1 8 When the private lands were returned t o the small farmers who withdrew fmm the UCPs in 1968-70, two major problems emerged. F'irst, the small farmers became increasingly dependent on the f a c i l i t i e s of l a r g e r farmers. During Phases I and 1 1, many small farmers sold o r slaughtered t h e i r livestock and equipment, r a t h e r than allow i t t o be confiscated; others gave up these a s s e t s t o the cooperatives irrevocably. After t h e dissolution of the cooperatives, t h e p r i c e of livestock increased dramati- c a l l y and most former U CP members had inadequate funds t o restore t h e i r farm assets. A s a r e s u l t , they became dependent on the purchased o r bartered services of equipment o r animals of t h e l a r g e fanners. Second, t h e con- centration of land ownership in Tunisia i s thought t o have increased as a result of t h e e a r l y phases of t h e cooperatives project. Fearing confis- cation of t h e i r lands, many small farmers s o l d t h e i r p l o t s i n 1958-69 t o l a r g e r landowners. 1/ See paragrsph 6.06.  6.1 9 Om interviews with small lizn&wnera &o resumed private fanning suggest t h a t another negative impact of the e a r l y phases of the cooperatin program i s the h o s t i l i t y same of these fanners have developed towards the Tunisian Qovernment, and this i n s p i t e of the f a c t t h a t even the most suspicious may admit thatwhile in the UCPs they leamed valuable new production techniques and useful new f a r r i n g and administrative sIdlls. 6.20 Fibally, one of the important benefits of the U CP program i s its stimulation of the development of agri-business enterprises within the Phase 111 UCPs. Current pmjeckLons show that this w i l l ultimately lead t o i n - creased agricultural exports, decreased dependence on imported agricultural goo&, and the increased a v a i l a b i l i t y of reasonably priced, high protein foods. F. R S e w of Result- 6.21 The following t a m e l i s t s the major objectives of the project and presents a summ azy assescnnmt of whether they were achieved. Table Ir llggregate Perforn2nce Record 7956-1968 (Phase I ) 1970-1 974 (phase 1117 1. Nzintain or increase production Uncertain results; yields Colon productivity levels on colon farm iand and production apparently and producticn levels held a t levels close t o ekceeded what colon farms would have reached, but below appraisal expectations 2, ELI71inate ~subsis+&nse Uncertain results; (Hot relevant; private agriculture by increasing productivity probably farm land withdrawn productivity on f o r r e r l y irpcorsd ht mil ud objective rbrndoned ; private s y I l h o U h g s below a q n c t a t i a u md d f s e t by declines elsewhere due t o f e a r of collectivization & &fmrrificatim, Brkoaive d i v s r s i f i - b.t holm ampoctatiann. cation achieved 4. Maintain employment f o r Jobs maintained but Jobs maintained and f om-er colon workers w r k e r s underemployed f u l l employment restored 5. Create employment f o r land- Jobs created but workers Some Phase I jobs l e s s seasonal workers underemployed maintained a t f1A1 employment, but many workers released 6. Increase incomes t o ~ 2 5 0 Period not completed, Trend reversed; incomes per worker within 6-8 years. but. incomes f e l l rather increased t o over ~ 2 5 0 than rose in early years 7. Create/maintain effectively Failure t o establish Sabstantial success operated production viability of Phase I of Phase I11 UCPs ccoperatitms UCPS vithin three year paid 6.22 The t a b l e brlngs out most of the s a l l e n t features of the U C P project history. During Phase I colon production l e v e l s were apparently nearly main- tained and prlvate l e v e l s on incorporated land probably improved. Ele per- formance in both categories w as far below expectations, however, and i t was accompanied by i n e f f i c i e n t management of labor and machinery inputs, sub- s t a n t i a l f i n a n c i a l losses, mounting unrest among the cooperateurs and per- nicious a f f e c t s on decisions by fanners still outside t h e system. There a r e signs t h a t some con& tions were beginning t o improve by l a t e 1968, but t h a t development w as overtaken by the dramatic events of 1969. The UCPs were reconstituted i n 1970. Since then t h e record has improved s u b s t a n t i a l l y in almst all respects related t o t h e new and shorter l i s t of U CP targets. Indicators of production, cKversiflcation, member incomes and i n s t i t u t i o n a l v i a b i l i t y all appear t o p r o d d e a success story. A major objective associated with the e a r l i e r program - t h e transformation of smallholder agriculture - has been abandoned within the context of the U CP strategy, however, and present UCPs function l e s s as cooperatives than as S t a t e farms whose workers share i n p m f i t s and management. G. --- of Return Rates 6.23 The a u d i t has not attempted t o estimate f i n a n c i a l and economic rates of return, InfonuatLm of physical and financial progress a t the farm l e v e l during 1966-1 970 is simply not avellable. If t h e appraisal model f o r the representative new U CP of Phase I i s reevaluated, using estimates of actual benefits (which cumulated much slower than expected) and actual c o s t s (which were higher on a per hectam b a s i s than expected), the r a t e of return falls below t h e forecast value of 10%. The f i n a n c i a l l o s s e s suffered by most of the Phase I UCPs and t h e i r high delhguency r a t e s suggest that t h e aggregate rate of return t o the project investments would i n f a c t have been close t o zero unless t h e r e had been a pheaomenal recovery of p r o f i t s after 1968, t o an extent no one considers possible. Information i s probably available t o pennit a cslculation of the r a t e of return t o t h e reconstituted and newly created UCPs in Phase 111, The audit did not evaluate this information, which i s not in an assembled form t h a t can be readily analyzed.  VII. LESSONS ABOUT COLLECTIVE FARMING SYS'EX 7.01 The r e v e r s a l of UCP performance from Phase I t o I11 r e v e a l s s e v e r a l u s e f u l lessons about cooperative and c o l l e c t i v e farming. Tunisian o f f i c i a l s , some of whom have p a r t i c i p a t e d i n the U CP program f o r almost a decade, have l i s t e d f o r the a u d i t the major reasons f o r t h e poor r e s u l t s during Phase I and the marked improvement i n Phase 1 11. The r e l a t i v e importance of the e i g h t f a c t o r s described on pages 17-2L can b e s t be judged from t h i s comparative assessment. 7.02 The Tunisians put a t t h e t o p of t h e l i s t t h e l a c k of cooperation and growing r e s i s t a n c e among s m a l l farmer members, a t t r i b u t a b l e fundamentally t o t h e involuntary character of membership i n Phase I and the withering of t h e economic inducements t o membership t h a t had once a t t r a c t e d the farmers. The p r i v a t e land was released i n 1969/1970; hence the problem disappeared. One of the c l e a r e s t l e s s o n s of t h i s h i s t o r y according t o our informants i s the d i f f i c u l t y of f i n d i n g i n c e n t i v e s i n c o l l e c t i v e farming t o compete with t h e farmer's attachment t o h i s s o i l . The farmers were obliged t o j o i n t h e UCPs o r l e a s e t h e i r land t o them, b u t beyond t h a t point f o r c e was n o t used a s an instrument of policy. Without force, it proved d i f f i c u l t t o c o n t a i n evasive a c t i o n and gathering h o s t i l i t y . Whether r e s i s t a n c e would have disappeared had weather and other f a c t o r s combined t o produce record crops and t a r g e t incomes w i l l never be known. 7.03 Closely r e l a t e d t o t h i s i s s u e of voluntarism, i n the opinion of t h e o f f i c i a l s , i s the management c r i s i s which continued throughout most of Phase I. It was an i n e v i t a b l e consequence of the poor preparation of the o r i g i n a l group of U CP d i r e c t o r s , the l a g i n the build-up of management t r a i n i n g courses, the unusually l a r g e and complex farm system planned f o r each UCP, and the i n e f f i c i e n c i e s of c e n t r a l i z e d c o n t r o l of production and finance. The management problem appears t o have been p a r t i a l l y solved by the end of 1968, t h a t is, w i t h i n a year and a h a l f of t h e f i r s t Bank disburse- ments, only t o reappear i n the Phase I1 acceleration. Subsequently, with the reduction i n numbers of UCPs i n Phase 1 11 , t r a n s f e r i n of a d d i t i o n a l , experienced s t a f f , improvements i n t h e t r a i n i n g programs and d e c e n t r a l i z a t i o n of some decisions, the management problem was u l t i m a t e l y overcome. 7. Oh The combination of improved management and worker morale provided a b a s i s f o r improvements i n farm operations, and these were complemented by the r e t u r n t o a reasonably good r a i n f a l l p a t t e r n i n t h e e a r l y 1970s. The g r e a t majority of t h e Phase I11 UCPs showed p r o f i t s - probably the s i n g l e - most v i s i b l e s i g n of t h e r e v e r s a l of e a r l i e r t r e n d s and p r o f i t s provided the l i q u i d i t y which enabled t h e i n c e n t i v e system t o operate and encourage even b e t t e r performance . 7.05 A t h i r d reason c i t e d t o e x p l a i n the poor performance i n Phase I was the bad s t a t e of physical c a p i t a l on colon farms brought i n t o t h e U CP system, and the shortage of new investment funds i n t h e program, Indeed t h a t was t h e primary reason why the G OT had turned t o the Bank f o r a s s i s t a n c e . But i n r e l a t i o n t o t h e schedule on which new UCPs were created, s t a r t i n g i n 1961r, the Bankgs disbursements began quite l a t e . The e n t i r e period 1964-1967 was characterized by a slowdown i n planned c a p i t a l formation, which i s explained i n t u r n by t h e l a c k of long term finance. Phase I11 farms could take advantage of a physical base t h a t had been gradually strengthened throughout the previous decade. . 7 06 The f i n a l f a c t o r l i s t e d i s the changing l e v e l of p o l i t i c a l interference, a f a c t o r which invested the UCPs i n Phase I with employment t a r g e t s and s o c i a l i s t doctrine f o r which n e i t h e r the farm plan nor farmer mentality had been properly prepared, and which was e f f e c t i v e l y removed i n Phase 1 11. 7.07 The p o l i t i c a l f a c t o r plays of course another r o l e i n the project history, since it influenced both the decision t o accelerate the coopera- t i v i z a t i o n of private lands i n January 1969, and t h e subsequent decision, e i g h t months l a t e r , t o r e l e a s e themel/ Although the r e s u l t s of the Phase I experience looks much worse than those of Phase 1 11, t h e image of f a i l u r e which many persons hold and some Bank documents c r e a t e f o r the e a r l y period is t o a large e x t e n t due t o the c r i s i s of 1969, including the a c t i o n s taken by private farmers i n 1968 i n a n t i c i p a t i o n of the rumored reforms. It uas based on t h e expectations which most observers - Bank and otherwise - develcpeci in mid-1969 a s they t r i e d t o a s s e s s t h e impact of rapld expacsica. 7 -08 The question t o ask i s whether i n the absence of the 1969 adjust- ments t h e Phase I UCPs would have eventually reached t h e i r t a r g e t s , bene- f i t i n g from a s e r i e s of gradual administrative and technical reforms, the f i r s t of which were introduced i n l a t e 1968. Most of our informants, i n the Bank and i n Tunisia, believe t h a t ultimately the modified Phase I coop- e r a t i v e system would have succeeded t o i t s objectives, a l b e i t f i v e years behind schedule, provided the d i s s a t i s f a c t i o n of small farmer members i n the e a r l y period could have been contained long enough t o reach the period of prosperity. It i s the. view of some of those presently i n the Ministry of Agriculture t h a t even the 1969 acceleration would ultimately have succeeded, i f time had been available. These assumptions and speculations cannot be tested. I n f a c t , one of the lessons must be t h a t the p r o j e c t does n o t t e l l us much t h a t i s t r a n s f e r a b l e about t h e long-term v i a b i l i t y of e i t h e r c o l l e c t i v e farming based p a r t l y on p r i v a t e p a r t i c i p a t i o n , o r of production cooperatives, since t h e Phase I system used an impure cooperative model t o begin Kith and the system was changed i n i t s infancy. 7.09 One other conclusion from t h e comparative analysis i s t h a t t h e contrast between t h e images of Phases I and I 11 i s even g r e a t e r than t h a t suggested by t a b l e 4. If. we take t h e vantage p o i n t of those planners in 196k whose p r i n c i p a l objective was t o create a large-scale farming system -combining s t a t e and p r i v a t e lands and some elements of - 1/ The audit did not attempt t o i n v e s t i g a t e the reasons f o r those decisions. Some observers emphasize the p o l i t i c a l f a c t o r s ; other observers (and p a r t i c i p a n t s ) minimize them. cooperative p a r t i c i p a t i o n - t h a t would eventually transform and modernize the e n t i r e r u r a l s e c t o r , then the r e t r e a t i n l a t e 1969 and the abandonment of key membership and welfare goals can only be judged a s a g r e a t disappoint- ment despite the subsequent record of surviving UCPs. If we take the vantage now of the highly s p i r i t e d UCP d i r e c t o r s i n 1975, whose h i s t o r i c a l reference is t h e present system and whose thoughts a r e not d i s t r a c t e d by t h e episode i n the last h a l f of the 1960s when a d d i t i o n a l , p r i v a t e farmlands passed i n and out of t h e program, then the e f f i c i e n t operations, r i s i n g p r o f i t s and increasing d i v e r s i f i c a t i o n on t h e i r farms, with a reasonably popular worker p a r t i c i p a t i o n scheme, must be judged as a success and source of s a t i s f a c t i o n . That ambiguity is t h e essence of the p r o j e c t , f o r it included within i t s seven-year e f f e c t i v e h i e t o r y the struggle and collapse of the e a r l y , preferred, innovative large s c a l e farming system incorporating p r i v a t e lands, and the successful emergence of a s u b s t i t u t e , l e s s ambitious system without them.  VIII. BANK PWZPORMANCE A. Appraisal 8.01 With the vantage of hindsight it i s possible now t o i d e n t i f y those weaknesses i n the p r o j e c t plans, a s they were prepared with t h e help of and appraised by Bank s t a f f , which can be strengthened i n subsequent, similar projects. The most important a r e found i n t h e fundamental economic r a t i o n a l e f o r t h e p r o j e c t design. One was t h e labor-absorbing capacity of the U CP. It i s doubtful whether even with the l i v e s t o c k component and i n t e n s i f i e d cropping the p r o j e c t should have been expected t o absorb the projected number of workers, since i n i t i a l l y t h e r e was an inadequate amount of land t o d i s - t r i b u t e t o these workers and since economies of s c a l e were expected t o increase the land/labor r a t i o even f u r t h e r . The o r i g i n a l p r o j e c t never was able t o employ e f f i c i e n t l y t h e projected work force, l e t alone t h e l a b o r e r s incorporated subsequently. Thus i n Phase I 1 1 some landless l a b o r e r s a s well a s the private farmers were released and the land/labor r a t i o increased by 70%. 8.02 The Bankts projections of the UCPts labor absorptive capacity due t o the introduction of a labor intensive l i v e s t o c k plan proved t o be over- optimistic. It c a l l e d f o r l i v e s t o c k products t o provide 26% of gross cash r e c e i p t s by the t h i r d year, and 35%by the f i f t h , and t o play a major r o l e i n e s t a b l i s h i n g the cash flow. In f a c t , the growth of the herd, the improvement of t e c h n i c a l parameters and the s a l e of l i v e s t o c k products proceeded a t a much slower r a t e , even during Phase I 11 when progress of the livestock component was rated r a t h e r highly. It is c l e a r t h a t the l i v e s t o c k plan badly forecast decisions by U C P d i r e c t o r s , technical advisers and private farmers, who r e s i s t e d the incorporation of t h e i r animals i n t o the UCPs. One problem was t h a t the UCPs were not empowered t o pay cash f o r animals brought i n by small farmer members. The plan was revised i n 1968 t o permit such purchases, but the reasons why such transactions were prohib- i t e d e a r l i e r , and the amount of p r o j e c t funds allocated t o livestock remained small, i s not known. I n f a c t a l l o c a t i o n s of Bank funds included p r a c t i c a l l y none f o r l i v e s t o c k - US$30,000 o r 2% of t h e o r i g i n a l p r o j e c t and 3% of t h e revised p r o j e c t .lf Ultimately $26,000 was disbursed, none of it f o r domestic animals. Even the use of the $26,000 has drawn c r i t i c i s m from some Rmisians, who claim t h a t the plan t o import b u l l s , while defendable i n the mid-60s when f a c i l i t i e s f o r a r t i f i c i a l insemination were s t i l l being developed, should have been abandoned altogether i n favor of a r t i f i c i a l insemination a f t e r 1969. The Bank and the Ministry of Agriculture a r e a l s o c r i t i c i z e d f o r t h e i r s e l e c t i o n of s p e c i f i c breeds which apparently did not adapt well t o Tunisian conditions. 8.03 One other economic assumption a t appraisal t h a t has never been properly confirmed i s t h a t m a x i m u m economies of s c a l e and comparative advantages obtain a t the 1,000 ha farm s i z e . Expropriated f o r e i g n farms had varied enormously in s i z e , and most of these had been joined - . t o others and/or augmented by the lands of smallholders. The concept of t h e optimal s i z e of 1,000 was not well developed: it was more a matter of administrative convenience. Yet the average c l e a r l y pointed toward 1/ Allocations f o r s t a b l e s , and the a t t e n t i o n given t o forage crops, sub- s t a n t i a l l y r a i s e the share of investments directed a t t h e l i v e s t o c k sector. assumptions about large farm economies. N o analysis was made t o determine even an optimal range, however, and c r i t i c s throughout t h e period have argued t h a t t h e optimal was much smaller, and c e r t a i n l y l e s s than the present s i z e of the UCPs (910 ha t o t a l area, 775 ha arable a r e a ) . The d i f f i c u l t i e s t h a t emerged in managing the large farms lend some credence t o t h i s view. The 1,000 ha model was established by the GOT, and questioned by the Bank a t i n i t i a l appraisal and a t revision. The Bank's request t h a t , in each case, and whatever the s i z e of the farm, a f e a s i b i l i t y study be prepared, was adhered t o by taking i n t o account mainly the financial elements, and i n s u f f i c i e n t l y t h e managerial constraints. 8.04 Some GOT sources a l s o question the decision t o u t i l i z e a l a r g e number of foreign experts, a number which reached a s high a s 18 i n 1968, although comments about the work of individual expatriate technicians were usually complimentary. FA0 and the Bank continuously argued in favor of a large ex- p a t r i a t e team. But the recruitment proceeded much slower than expected, s a l - a r i e s and other expenses were high, and some experts never functioned effec- t i v e l y in Tunisia. Ultimately $1.7 million were disbursed by the Bank f o r tech- nical assistance, 18%of t o t a l Bank disbursements (8% of disbursements under the original project and 27% since the revision). These funds were allocated t o the support of t h e resident expatriate team. The team was mostly involved with preparation, review and implementation of farm and financial plans, though t o some extent it got involved a l s o with t r a i n i n g functions. Since p r h r y re- sponsibility f o r training of the Tunisian technicians remained with b i l a t e r a l and other UN donor agencies, there was no mandate f o r the Bank t o assume a dominant role. However, it has been suggested t h a t t h e project team should nevertheless have been involved more heavily i n developing and running short- term training courses f o r t h e local managerial and technical s t a f f . This c r i t - icism i s related t o a l a r g e r issue concerning the apparent f a i l u r e of t h e Bank before 1969 t o concentrate s u f f i c i e n t resources on the problem of improving the l e v e l of competence of the farm directors. The Bank had anticipated a t ap- p r a i s a l t h a t the management f a c t o r would be c r u c i a l , but project design and subsequent reports do not r e f l e c t t h a t urgency. Part of the problem stems from t h e creation by GOT of too many new cooperatives t o which both experienced and newly trained directors were sent, draining t h e existing cooperat?ves and a l - lowing no time f o r consolidating t h e i r achievements. This trend became p a r t i c - u l a r l y severe in 1968, but was apparently not adequately brought t o Bank man- agement's attention, o r thence t o t h e attention of t h e Government. The point i s raised again a s a weakness a t supervision during Phase I. 8.05 None of these comments on appraisal constitutes any serious c r i t i - cism of the original appraisal process, since a l l of t h e forecasts were known then t o depend upon risky assumptions about t h e capability of the GUT t o i m - plement t h i s innovative and complex project a s designed. One may ask whether a smaller, p i l o t project would have b e t t e r tested the operative assumptions and ultimately economized on money and avoided t h e l o s s of t h e goodwill of the cooperateurs. But a p i l o t project was not a viable option by 1966. Together the Bank and FA0 had persuaded t h e GOT t o severely reduce the s i z e of the orig- i n a l 1964 proposal. Insofar a s the Tunisians were convinced t h a t the 1,000 ha model would work, and because they would probably have refused f u r t h e r compres- sion, the donor agencies had already exerted a s much of a moderating force a s t h e i r leverage would allow. In any case the GOT was moving ahead with the i m - plementation of the U CP program, and by the time the loan/credit w as actually signed the majority of t h e new UCPs had already been formed. 8.06 Tunisian a u t h o r i t i e s give s u b s t a n t i a l c r e d i t t o the Bank f o r the development of the planning, programing and budgeting system f o r individual farms. The Bank's input a t t h i s point was c r u c i a l . Despite t h e slow s t a r t of the l i v e s t o c k plan, the basic design, including the modification of the cereal/fallow r o t a t i o n with the introduction of forage crops, i s considered by most GOT o f f i c i a l s t o be the key t o the eventual success of the U CP program and a s i g n i f i c a n t innovation t o W i s i a n agriculture. The Bank's assistance i n the plans f o r crop d i v e r s i f i c a t i o n schemes i s a l s o cited: the new vegetable and t r e e crops introduced became l u c r a t i v e income generators i n Phase I 1 1 and an important source of employment opportunities. 8.07 The f a c t t h a t the Bank i s credited with substantive contributions t o p r o j e c t design i s impressive, but it i s c l e a r t h a t most GOT o f f i c i a l s f e e l t h a t the e n t i r e cooperative program, including the UCPs, was of indigenous origin and management, and t h a t the Bank's primary contribution a f t e r nego- t i a t i o n s was t o finance the import program. From t h a t point of view, the Bank's r o l e , a t l e a s t during t h e implementation period i n Phase I, was t o help pay f o r the t r a c t o r s . Be Supervision 8.08 The supervision schedule was generous t o t h i s p r o j e c t and the frequency of missions exceeded the Bank norm. Between effectiveness i n July 1967 and revision i n November 1970, nine Bank missions and two FA0 missions v i s i t e d the p r o j e c t (three of them a s s i s t e d with the revision of the project). Seven more Bank missions followed during the period of the revised p r o j e c t , including the p r o j e c t completion report team i n October 1973. The average mission included two o f f i c i a l s and the average length of the missions was 1 1 days before the revision and 15' days t h e r e a f t e r . The r e l a t i v e l y l a r g e supervision input matches the heavy Bank input preceding the project agreement, and r e f l e c t s the concern f e l t i n the Bank f o r giving adequate a t t e n t i o n t o an admittedly complicated project. m e x 17 presents a complete l i s t of preliminary and supervision missions. 8.09 Appendix 1 t o annex 7 analyzes the q u a n t i t a t i v e supervision input. The analysis shows t h a t the impact of supervision i n Thase I was p a r t l y dil~ted by the high r a t e of turnover of mission personnel t h a t characterized t h i s period of growth i n the Bank's a g r i c u l t u r a l p o r t f o l i o . Of the 16 Bank supervision missions i n the six-year period September 1967 ( f i r s t supervision) t o October 1973 (PcR), over half of the Bank p a r t i c i p a n t s joined only one mission, and f i v e out of s i x joined no more than two missions. The main continuity f o r the p r o j e c t was provided by one t i r e l e s s Bank o f f i c i a l , who participated i n 1 0 appraisal and supervision missions from 1965 t o 1971. According t o GOT o f f i c i a l s , the continuity of Bank s t a f f involvement was nevertheless inadequate. They say t h a t t h e i r time was wasted i n repeating explanations of the p r o j e c t t o new mission members. 8.10 Supervision focused on s e v e r a l key i s s u e s and paid l i t t l e a t t e n t i o n t o several others. During Phase I, t h e reports d e a l t a t length with: (1) the frequent, sometimes unexplained policy changes by the GOT, f o r example the modifications in the i r r i g a t i o n component and the acceleration of plans f o r c r e a t i n g new UCPs, including t h e conversion of pre-coops; (2) the d i f f i c u l t i e s encountered by the Bureau of Control owing t o i t s l a c k of adequate a u t h o r i t y and autonomy; (3) the delay i n the production of f e a s i b i l i t y s t u d i e s f o r individual coops, including the elaboration of a f i n a n c i a l projection alongside the physical plan; (4) the f i n a n c i a l accounts of the UCPs, moat of which, we said, were running d e f i c i t s b u t were unable t o present proper records; (5) the shortage of spare p a r t s and r e p a i r f a c i l i t i e s f o r the farm machinery; and (6) t h e delays i n construction of farm buildings and i r r i g a t i o n f a c i l i t i e s and i n t h e s t a r t - u p of the l i v e s t o c k operation, 8- 1 1 Supervision i n Phase I can be f a u l t e d f o r reporting p r a c t i c a l l y no information about farm l e v e l developments, except the aggregate p r o f i t / l o s s statements. Production and productivity f i g u r e s a r e n o t given, and there is no discussion of the a c t u a l r a t e of development of t h e c r u c i a l components of the a p p r a i s a l ' s model farm plan. The l a t t e r included schedules f o r increases i n grain, t r e e crop and l i v e s t o c k income i n the cash flow, but t h e r e i s no evidence i n supervision r e p o r t s t h a t the Bank t r i e d t o measure these trends. Moreover, there i s l i t t l e in-depth discussion or a n a l y s i s - i n Phase I super- v i s i o n reports - of management and labor i s s u e s a t the farm l e v e l , For a pioneer project, based on a p p r a i s a l projections t h a t were always conside-ed precarious, the Bank should have attempted during the supervision period t o observe more systematically operations and progress a t the f a n l e v e l and thus t o put i t s e l f i n a b e t t e r p o s i t i o n t o a s s i s t the GOT i n anticipating and correcting emerging problems. 8.12 The Bank appears t o have shown the proper balance of f l e x i b i l i t y and force i n i t s responses t o apparent v i o l a t i o n s of covenants and other agreements during Phase I. Bank supervision was inclined t o be p a t i e n t , given the d i f f i c u l t job facing the Bureau of Control and the ideological and p o l i t i c a l currents which influenced i t s effectiveness. Supervision's record of success i n constraining GOT p o l i c i e s was spotty. The missions repeatedly recommeded t h a t the a c c e l e r a t i o n and expansion of the cooperative program be r e s t r i c t e d , but the recommendations were not followed, a t l e a s t not before the end of Phase 11. But the Bank was able t o l i m i t the use of Bank-funded items t o the precise objectives outlined i n the agreement. For example, supervision i n s i s t e d t h a t Bank-funded machinery f o r S t a t e farms could not be used on the lands t o be converted i n t o new UCPs. 8.13 The Bank's r e a c t i o n t o t h e January 1969 a c c e l e r a t i o n orders took the following course. F i r s t , the February 1969 supervision mission s t r e s s e d t o t h e GOT t h a t the extension of forced cooperativisation t o a l l farmers and the acceleration of the c r e a t i o n of new cooperatives could s e r i o u s l y threaten the success of both the program and the p r o j e c t , and could a l s o adversely a f f e c t Tunisian a g r i c u l t u r a l development, The mission's report suggested t o the Bank leadership t h a t i f t h e p r o j e c t ' s progress continued t o be slow, and i f , by June 1969, the GOT could not present a sensible schedule f o r f u r t h e r development, the Bank should reconsider i t s continued support. In March the Bank s e n t a l e t t e r t o the d i r e c t o r of the U PC program, the Secretary of S t a t e f o r the Plan and National Economy, s t r e s s i n g t h e Bank's grave concern about the progress of t h e project, The Secretary v i s i t e d Bank headquarters i n May. H e assured Bank o f f i c i a l s t h a t the p r o j e c t would be completed a s planned, and emphasized the importance of the s o c i a l objectives of the cooperative program and the value of the management experience which had already been gained. But, i n July, a follow-up supervision mission described i n quan- t i t a t i v e terms the p o t e n t i a l e f f e c t s of program a c c e l e r a t i o n on the o r i g i n a l U C P project. The expansion of p r o j e c t acreage by 88,000 ha ( a 32% expansion) and t h e increase i n t o t a l p r o j e c t c o s t from $32 million t o $S& million ( a 698 increase) would place a heavy additional burden on the Bureau of Control. The GOT a l s o planned t h a t the BC would be responsible f o r e s t a b l i s h i n g new UCPs on the L96,000 ha of lands claimed i n 1969. These UCPs, which were t o be organized by September 1970, were t o remain outside the p r o j e c t a r e a b u t under the d i r e c t i o n of the BC. The new t a s k s were already causing delays i n % h e BC1s program of consolidation of the previously established UCPs, and s e r i o u s l y threatened the Bureau's capacity t o perform i t s assigned M c t i o n s f o r the r e s t of the p r o j e c t period. The b p r e s s i o n was l e f t t h a t t h e Bank might suspend disbursement of the funds o r even cancel the balance of the loan. T wo months l a t e r the GOT reversed i t s position, f o r reasons which go beyond the scope of t h i s p a r t i c u l a r project. 8.lL Although information on B N T t s r o l e i n the p r o j e c t i s scarce, the Bank may have been i n d i r e c t l y instrumental through B NT i n bringing about the changes i n Government policy towards the UCPts. The B NT was i n charge of channeling p r o j e c t funds t o the cooperatives, checking on t h e f i n a n c i a l v i a b i l i t y of the UCPts c r e d i t requests, and providing independent a u d i t i n g s e m i c e s t o the cooperatives f o r the BC. Strengthening of BNTts operations with regards t o i t s involvenent i n the U C P program was provided by the project. One of the foreign t e c h n i c a l a s s i s t a n t s was assigned t o the BNT as chief of a small group of Tunisian s t a f f i n charge of the U CP activities. BNT1s p a r t i c i p a t i o n i n the p r o j e c t appears t o have proven valuable i n a t l e a s t two respects: (1) it was the BNT, whose Chairman reported indepen- dently t o the Government, which informed the Government of the d e t e r i o r a t i n g f i n a n c i a l s i t u a t i o n of t h e cooperatives, thus, alarming the a u t h o r i t i e s a s t o the need f o r modifying the system; and (2) BNTts e f f i c i e n t accounting procedures permitted it t o assess rapidly the f i n a n c i a l s i t u a t i o n of each UCP, thus g r e a t l y f a c i l i t a t i n g t h e t r a n s i t i o n from Phase I1 t o Phase I11 operations. Whether BNT would have acquitted i t s e l f as e f f i c i e n t l y of these tasks without the support provided by the Bank through the p r o j e c t , w i l l never be known. In the meantime, however, the Bank can be credited f o r its c o r r e c t views on the need for reenforcing the p a r t i c i p a t i o n i n the p r o j e c t of a f i n a n c i a l l y s t r i c t organization, which would s c r u t i n i z e the UCP1s f i n a n c i a l s i t u a t i o n on a continuous basis. 8 .lS After September 1969, the Bank collaborated with the GOT i n formulating a revised project. The opportunity t o abandon the p r o j e c t was ignored; three missions v i s i t e d Tunisia i n the 10-month period October 1969 t o July 1970 and a new agreement was signed i n November 1970. Subsequent supervision r e p o r t s d i s t i n g u i s h themselves from Phase I reports by the l a r g e amount of information presented on such topics as c e r e a l production, y i e l d s and prices, l i v e s t o c k s a l e s by weight and age, and income earned by cooperateurs. More important, f o r the f i r s t time the reports contain routine and d e t a i l e d information about farm l e v e l management, such a s : t h e number of coops with management considered inadequate, measures taken t o provide additional d i r e c t o r s , and the q u a l i f i c a t i o n s of the new r e c r u i t s . 8 -16 The a t t e n t i o n t o the d e t a i l of both farm and s t a f f performance in the revised loan period closed an important gap i n ex p o s t evaluation. In Phase I t h e Bank had received masses of d a t a on individual coops - balance sheets, p r o f i t and l o s s statements, production, s a l e s and s a l a r y figures. But the Bank paid primary a t t e n t i o n t o i n d i c a t o r s of success which missed most of those two areas; concentrating r a t h e r on the most urgent problems a t t h a t time, namely: (1) procurement and construction of s p e c i f i e d physical machinery and f a c i l i t i e s ; (2) development of the Bureau of Control; and (3) aggregate p r o f i t and debt statements f o r UCPs. The f a c t t h a t the Bank paid more a t t e n t i o n t o farm progress i n d i c a t o r s i n Phase I11 r e f l e c t s a l s o i n p a r t a general t r e n d i n Bank supervision a c t i v i t i e s t h a t has occurred i n the 1970s and i n p a r t the growing problems which farm management presented i n t h i s unique project.  IX, CONCLUSIONS 9.01 Viewed from a p o s i t i o n outside t h e perimeters of both che o r i g i n a l and revised p r o j e c t s , t h e Bank's performance, delimited a s it was by v i r t u e of the f a c t t h a t t h e Tunisians were running t h i s show completely, i s not unimpressive. The Bank associated i t s e l f c l o s e l y in t h e mid-1 960s with t h e design of an inventive program involving tenure reform and new c u l t i v a t i o n systems, and l a t e r , follawing p o l i c y s h i f t s over which t h e Bank had very l i t t l e influence, t h e Bank adjusted t o new tenure r u l e s and helped replan and finance a successor scheme which appears t o be successful. 9.02 between 'There i s s t r i k i n g d i ~ ~ r e p a n c g t h e s u b s t a n t i a l l e v e l of a n a l y s i s of expected coop performance - technical and economic - which t h e Bank (and FAO) invested in t h e p r o j e c t p r i o r t o t h e loan agreement, and t h e absence of analysis of performance in t h e supervision period. The r e l a t i v e commitment of a n a l y t i c a l resources t o preparation and appraisal, on t h e one hand, and t o supervision, on t h e other, seems disproportionate. F l e x i b i l i t y would seem e s s e n t i a l t o t h e success of t h i s c l a s s of p r o j e c t s , and t h e Bank must broaden t h e scope of supervision t o permit adequate information r e t r i e v a l and i n t e r p r e t a t i o n . This does not necessarily imply t h a t Bank time committed before agreement was extravagant, indeed one can argue t h a t same of t h e disruptive f a c t o r s might have been b e t t e r predicted had even more a t t e n t i o n been given previous t o implementation. Nor does it b p l y t h a t Bank time committed t o supervision was beluw par: t h e opposite i s t r u e . But it would appear t h a t p r o j e c t s characterized by a s many u n c e r t a i n t i e s and r i s k s a s t h i s one was known in advance t o involve must be assigned special suqervision c o e f f i c i e n t s t o allow f o r extraordinary mid-project survey. Since t h e t o t a l available Bank time i s f i n i t e and r e s t r i c t i v e , it may be necessary f o r these P I W J ~ C ~ S ,many of which can be i d e n t i f i e d in advance, t o shorten t h e preparation/appraisal period and d e l i b e r a t e l y conserve s t a f f t a l e n t s t o concen- t r a t e them on t h e implementation period. 9.03 The GOT and the Bank overestimated the r a t e of increase of pro- duction and incomes, and underestimated the attachmept of the p r i v a t e farmers f o r t h e i r s o i l . When the b e n e f i t s f a i l e d t o materialize, the incentive system which was supposed t o s u b s t i t u t e f o r private owner-operated farming collapsed, and the p r i v a t e farmers defected. One lesson i s t h a t , i n order t o succeed with the conversion of small owner-operators i n t o members of production cooperatives of the Tunisian model, the reactions of those operators must be b e t t e r understood than they were i n t h i s case, and the s u b s t i t u t e s e t of incentives must be appropriate and r e a l i s t i c . 9.0b Tne problem of ensuring proper management a t the individual coop l e v e l was recognized by the Bank a t appraisal a s a serious t h r e a t t o project success. But Bank o f f i c i a l s d i d not f e e l the Bank could contribute substan- t i a l l y t o the solution of the problem, possibly because t r a i n i n g courses were already being financed by b i l a t e r a l agencies. In hindsight i t would appear t h a t t h e coop management functions in general and t h e l o c a l t r a i n i n g a c t i v i t y in p a r t i c u l a r should have been brought f u r t h e r i n under t h e umbrella of pro- j e c t finance and supervision, even though t h a t would have r e q u i r e d some changes i n t h e r e l a t i o n s h i p between t h e p r o j e c t and o t h e r donors. A s it was, t h e record suggests t h a t t h e Bank g e n e r a l l y paid i n s u f f i c i e n t a t t e n t i o n t o such problems in Phase I, even though t h e wnagement c o n s t r a i n t may have remained i n t h e view of i n d i v i d u a l s on supervision missions. Though we b e l i e v e t h e Bank should have been more ccmcerned f o r t h e progress of t h e management and t e c h n i c a l t r a i n i n g program, we recognize t h i s i s a s u b j e c t in wbich, in a g r i - c u l t u r e , t h e Bank had and s t i l l h a s l i t t l e experience. 9-05 A r e l a t e d i s s u e i s highlighted by t h e f r e q u e n t use of t h e word "delayH in s e c t i o n s of t h i s r e p o r t discussing implementation and disbursement. The delays a r e a l l measured with r e s p e c t t o a p p r a i s a l and p r o j e c t agreement schedules, and it was impossible f o r t h e a u d i t t o determine i n each case whether the schedule was u n r e a l i s t i c o r implementation proceeded slower t h a n it could reasonably have been expected t o have done. Considering t h e number of "delaysH, however, it seems c e r t a i n t h a t the schedule d i d n o t allow adequately f o r common and uncommon problems of p r o j e c t execution. 9.06 The p r o j e c t record g i v e s u s few g u i d e l i n e s f o r preparing genuine cooperative p r o j e c t s in other c o u n t r i e s , though t h a t w a s once one of t h e ex- p e c t a t i o n s of Bank s t a f f . In f a c t , t h e record t e l l s us v e r y l i t t l e about such cooperatives, except of t h e d i f f i c u l t y of maintaining small f a r r . ~ rnember a l l e g i a n c e . The more i n t e r e s t i n g a s p e c t s of t h e p r o j e c t a r e r e l a t e d t o +,he d i f f i c u l t i e s of organizing l a r g e s c a l e farming systems in general than t o co- operative behavior. It would appear t h a t t h e Bank expected t o l e a r n l e s s o n s which t h e p r o j e c t was i n h e r e n t l y incapable of o f f e r i n g p r e c i s e l y because it, was p a r t of a cooperative program p e c u l i a r t o Tunisia and t o a p a r t i c u l a r , f l u i d period in Tunisia's h i s t o r y . That may be t h e n a t u r e of most coopera- t i v e s p r o j e c t s , i . e . s i t u a t i o n s p e c i f i c and impure. 9 07 F i n a l l y , one i s impressed by t h e remarkable change by which t h i s p r o j e c t was transformed from the e a r l y a p p r a i s a l d e s c r i p t i o n . One conclusion i s t h a t Bank s t a f f resources can be s h i f t e d from a p p r a i s a l t o supervision, as mentioned above,provided a p p r a i s a l procedures are changed. Another i s t h a t success can depend much more upon t h e r a t e a t which t h e p r o j e c t executing agencies develop the capacity t o implement f i e l d p r o j e c t s , than upon t h e i n i t i a l design of the f i e l d program. The management u n i t of t h e Bureau of Control, now incorporated i n t h e OTD, has developed i n t o a s t r o n g a c t i o n agency t h a t i s e f f e c t i v e l y developing and implementing a g r a r i a n p r o j e c t s . This suggests t h a t whatever resources t h e Bank d i v e r t e d from implementation - i s s u e s r e l a t e d s p e c i f i c a l l y t o t r a c t o r imports t h e main p h y s i c a l element financed by Bank funds - t o strengthening the BC a s a whole were not wasted. The increase i n t h e a l l o c a t i o n of Bank funds t o t e c h n i c a l a s s i s t a n c e f o r the BC was a move i n t h i s d i r e c t i o n . The Bank may have been able t o i n v e s t even more i n i n s t i t u t i o n b u i l d i n g than it d i d , notwithstanding t h e f a c t t h a t t h i s matter was given increasing a t t e n t i o n i n t h e Bank.  Table 1 SUMMARY OF NOLUTION O F LOAN/CREDIT FUNDING (US$ m i l l i o n ) Original Revised Planned Disbursed Project Cancelled Project Disbursed Under M sbur sement s a s of Agreement Fundinn Ameernent Original P r o j e c t RevisedProject Dec. 31, 1973 5-9 6.1 4-5 2 -3 6.8 Loan Credit 12.0 -6.0 % 2 a - 1.6 - 0.8 2. Total 18.0 8.8 9.2 6.1 3-1 9.2 Table 2 SMMAFtY OF PROJECT EXOUTION BY DISWIXSBENT CATEGORY ( U S million) Original Original Revised Revised Disbursed Disbursed Balance Project Loan/ Project Loan/ Reallocated Under Original a s of Outstanding Cost Credit Cost Est. Credit ~oan/Credit ~oan/Credit Dec. 31, 1973 ( ~ v e r d r a w n L/ ) Buildings Purchase of Farm Machinery Repairs of Farm Machinery I r r i g a t i o n Equipment Imported Live stock Technical Assistance Other Local Expenses TOTAL COST 11 Funds f u l l y disbursed by March, 1974. - Source: IBRD/IDA Project Completion Report, January 31, 1974.  Table 1 A LE K I P JENDOUBA BIZBUE NAEEXL ' f of brea NO. of NO. h a NO. of NO. of &ea NO. of NO. of &ea NO. of NO. of Area No. of UCP's Added Coope- UCP's Added Coope- UCP'S Added Coq'e- UCP'S Added coopem UCP's Added coop- Years - Created ( h a ) r a k u r s Created (ha) r a t e u r s Created r a t e u r s Created ( b ) rat-8 Created ( b l r a t e u r a Total f o r 5 Gouvenzorats Average Land n0.0f NO. 01 Average &-eta Average No. Area p e r Cooperateur UCP's Added Coope- of CPU' a of Cooperateurs per U C P Added Years Created ( h a 1 r a t e u r s Created per UCP Added (ha/cooperateur ) - 1/ Active cooperateurs. Source: OTD/BC and Les Cooperatives Agricoles de Production En Tunisie.  Table 1 COMPARI S ON OF CHARACTERISTICS OF UCP1S 1962-1974 Average Average Total Total Total Average No. of Land Area Per No. of Land No. of Siee UCP Cooperateurs Cooperateur Years UCP1s Area(ha2 Cooperateurs (ha) Per UCP ( ha/Cooperateur ) - 11 Difference between this figure and the one in para 4.28 of the text is not explained. It may be due to reports taken from twodifferent month#. - 21 Estimate Source: OTD/BC.  Table 1 ORIGIN OF LANDS ~NCORPOIULTERINTO UCPf S, 196368. ANNEX 4 (area in ha. State Land of Rented Year Lands Coo erateurs Lands TOTAL r i - *rea Source: ~ a k h l o u f , 1971, p . d o . Table 2 OFUGIN OF LANDS XNCORPORbTIP) INTO UCPf S, 1966, BY G0UVERNQRB.T (area i n ha. ) No. of State Land of 3/ Rented Total Gouvernorats UCPfs Lands C o d r a t e u r s Lands Others Area Bizerte 13 3.003 l4.589 391 522 18 .So5 16.2 78.8% 2.S 2 9% Le Kef 67 16.080 21.SU.i 17.825 6.937 62.386 25.8% 34.5% 28.6% 11S . Jendouba 35 11.355 21.940 2.966 2,243 38 -504 29.5% 57.0% 7.7% 5.8% Nabeul 16 24.l48 3.021 25 172 27.366 88.2% 11.0% 0-U 0.7% 2/ Total 276 . 135.635 122 364 25.338 10.464 294 ,401 46.S 4i08% 8.6% 3.5% Including both active and inactive cooperateurs. Representing 92.79% of existing UCPfs; as of December 31, 1966. Source: L e s Cooperatives b r i c o l e s de Production en Tunisie.  Table 1 ANNEX 5 DISTRIBUTION OF SIZE O F LAND HOLDINGS CONTRIEUTED TO UCP ' S BY COOPERBTEURS 13 UCPfs, Northern Tunisia 13 UCPfs i n Le Kef % ,of ;g o f ;g of 3 of Cooperateurs Area Cooperateur Source: Makhlauf, 1971, p. 91. Table 2 NUMBER OF ACTIVE AND INACTIVE COOPERATWRS, BY GOWEENORAT, 1966 No. of Average No. No. of Average No. of No. of Active of Active Inactive InacfLve Cooperateurs Gouvernorat UCP's Coo~erateurs Cooperateurs Coouerateurs Per UCP Bizerte 13 798 61 790 61 Le ~ e f ' 67 3 644 Sh 4 325 6.5 Jendouba 35 3 670 105 3 488 100 Bej a l45 8 103 56 1 017 7 Nabeul 16 1 315 82 492 31 TOTAL l J Representing 92.7% of existing UCP' s as of December 31, 1966. Source: Les Cooperatives Agricoles de Production en Tunisie,  ANNEX 6 - 53 - Table 1 FUNDING CATEGORIES AND FOREIGN EXCHANGE COSTS OF ORIGINAL PROJECT AND LOAN/CREDIT B. New Cooperatives . I Buildings 1. O 1.8 - - .- 0.3 1.4 0.4 Farm Machinery 4.1 7.9 . 6.0 6.3 1.6 I r r i g a t i o n Equipment 1.6 3.0 1.2 2.4 0.6 Tree Crops (1) 1.0 1.8 1.8 P a s t u r e (2) 0.9 1.7 1.7 Sheep Purchase 0.2 0.5 0.5 C a t t l e Purchase 0.4 0.7 0.7 Imported Bulls o f Dairy Breeds 0.4 0.1 0.1 0.1 Water and S o i l Conservation 0.4 0.8 0.8 Technical S e r v i c e s (3) 0.4 0.9 0.4 0.7 0.2 S t u d i e s (4) 0.5 0.9 0.5 0.7 0.2 Sub T o t a l 10.5 20.1 8.5 11.6 8.5 C. S t a t e Farms Farm Machinery 1.4 2.7 2.0 2.2 0.5 TOTAL 17.0 32.5 12.4 18.0 14.6 PERCENTAGE 100 38.2 55.2 (1) ........ Mainly p l a n t e d m a t e r i a l .. (2) . . . . . . Regeneration o f e x i s t i n g p a s t u r e land . ( 3 ) . . . . . . . S a l a r i e s and o t h e r c o s t s o f e x p a t r i a t e and l o c a l supervisory s t a f f (4) . . . . . . . . F e a s i b i l i t y s t u d i e s prepared by c o n s u l t a n t s * . . . . . . . . . T h e Bank/IDA would f i n a n c e 80% of t h e t o t a l c o s t o f a l l items involving f o r e i g n exchange Source: IBRD/IDA A p p r a i s a l Report, January 1 9 , 1 9 6 7 .  Table 1 1967 PROJECTION O F GROSS INCOME OF ONE 1000 HA. UCP, BY PROISJCT. DURING FIR= 8 TEARS O F OPERATIONS (IN DINARS) Year f o r UCP Cereal Tree Inter -% of Irrigated % of Started in 1967 U Pre - CP Rotation 6.880 Plantation 900 - Total 10.0 Cropping - 00 37 Live s t ~ c k Total 720 8.0 Total 9.000 - 500 2.4 1.6 900 3.4 2.7 1,800 5.7 3.6 1,800 5.1 4.3 1,800 4.6 4.3 1,800 4.6 3.2 1,800 4.6 2.2 1,800 4.65 - 1/ Reflects OED assumptiomabout pre-UCP sources of income. Source : IBRD/IDA Appraisal Report, January 19, 1967.  ANNEX 7 Assumptions Used in-1967 P r e c t i o n s of Gross Income for h e 1,006 ha. UCP m x 1 A. Cereals: 1. Proportion of land planted in hard wheat, 50%; soft wheat, 35%; and barley, 15%. 2. Price of hard wheat, ~4.2001q.; soft wheat, D3.4501q. ; barley, D2,500/q. 3. Average yield of all cereals to rise from 10qlha. in year 1 to 13lqlha. in year 5; 4. Therefore, average income per hectare for all cereals to increase from D38 in year 1 to D50 in year 5; 5. Area planted in cereals, year 1-4, to be as follows: 447 ha., 432 ha., 417 ha., and 402 ha.; starting in year 5, area in cereals to remain constant at 387 ha. B. Pulses (Peas and Chickpeas): 1. Average yield to increase from 5qlha. in year 1 tD 6qlha. in year 5. 2. Price to average D4lq. 3. Therefore income per hectare to increase from D20 in year 1 to D24 in year 5. 4. Area planted in pulses in year 1-4 to be as follows: 83 ha., 78 ha., 73 ha., and 68 ha.; starting in year 5 area in pulses to remain constant at 63 ha. C. Olive Tree Plantation: 1. Yields in kilograms per hectare to be as follows: After Year 1-5 Yr.6-10 Yr.11-15 Yr.15 Existing Plantations 1,000 1,500 1,500 1,500 New Plantations - 250 1,000 2,200 2. price per ton to be D30. D. Intercropping (Soft Wheat) : 1. Yield to average 12 qlha. 2. Area planted per year to increase from 10 ha. in year 2 to 40 ha. in years 5 and 6, and decrease to 10 ha. by year 9 and be phased out in year 10. E. Irrigated Crops (Vegetables): 1. Area planted to be 6 ha. 2. Average income per .ha. to be D300. 3. In year 1, soil to be prepared and only soft wheat to be produced, yielding an income of D500. 4. In year 2, half of normal income to be produced D900. - F. Livestack (Cattle and Sheep) : 1. Value of meat from cattle estimated at D60-65 per calf and D70-80 per adult cow. 2. Value of milk estimated at D.O45/liter, with production increasing from 200 liters per cow in year 2 to 2,200 in year 10. 3. Calves to be sold at market estimated to yield D551calf (purchase price, D30; to be fattened for nine months on surplus fodder and sold for D85lcalf. 4. Gross income per sheep, D8; total income to increase from D640 in year 2 to D2,520 in year 5-20. Source: IBRDIIDA Appraisal Report, January 19, 1967.  - ANNEX 8 "1 mr- r( cur- $ * : I -5 m m ,IS g m mg ; .' I 3% q 9 : 0 A mr- In m e 5:1 m z- 2 m I  Table ' FINANCIAL RESULTS OF UCPf S, u66-19.73 (in dinars) No. of Total Statements Positive Results Nepative Results Year Number of UCPfs Received &Audited P Number of Total Amount Number % of Total Amount Balance 1966-68 Average Results per Year ( ~ i s c a lYears 1-2) 316 3 4 1970-71 Average Results per Year 224 223 Source: OTD/BC.  Table 1 BANK OF AGRICULTURE (BNT) LOANS AND CREDIT TO ALL AGRICULTURAL COOPERATIVES, 1964-68 (million dinars) MEDIUM AND SHORT TERM LONG TERM Source : Grirra. - 1 . 2 TOTAL DEBT AND ARREARS OF UCP'S, 1968-69 Debt t o Percentage Local Arrears/ A s of Debt t o B N T Suppliers Total Total Total Unmatured Arrears Total Arrears Debt A r r e a r s Debt December 31, 1968 7.500 4.285 11.783 2.080 13.863 6.365 46 March 31, 1969 7.633 4.155 11.789 2.080 13.869 6.235 45 August 31, 1969 4.462 6.505 10.966 2.808 13.774 9.313 68 Dec,ember 31, 1969 4.683 6.042 10.725 2.808 13.533 8.850 65 'hbl. 3 SHORT TERN LOANS AND CREDIT TO UCP'S, 1969-74 YEAR TOTAL 1969-1970 3.135.774 1970-1971 1.249.685 1971-1972 1.097.008 1972-1973 733.388 1973-1974 911.086 Source: IBRDIIDA.  ANNEX 11 o 2 arc cw Or( c h o a o a orcg nxu n d I I- cd m o d rc U W h mrc c d h a 0 3 rc o r c z !A x 4J  Table 1 1970 ANO 1973 CHARACTERISTICS OF UCP'S, BY REGION 1970 Average No. Average Average Average Average Number of Number of Cooperateurs Total Area Cultivable Cultivable cultivatedL1 Tree Tree Crops Irrigated I r r i g a t e d Area Fenced Grazing Open ReRLon UCP' s Cooperateurs per UCP Area p e r UCP Area Area p e r UCP Area Crops p e r UCP Area p e r UCP Land Range (ha) (ha) (ha) (ha) (ha) (ha) (ha) (ha) (ha) (ha) (ha) Beja 117 4,680 40 Jendouba 21 996 47 Le Kef 29 1,016 35 Bizerte 29 1.685 58 Nabeul 22 975 44 Tot a1 2 18 9,352 43 Beja 49 Jendouba 21 Le Kef 28 mteur 23 Medjez 53 Tunis Sud 36 Tunis Nord 16 Nabeul 15 Total 241 Table 2 COMPARISON OF 1970 AND 1973 CHARACTERISTICS OF UCP'S Change (197311970) +11% +19% +12% 11 Not including a r e a planted i n t r e e crops o r i r r i g a t e d a r e a . ?/ - Fenced Grazing Land and Open Range. source: 0TD/BC.  Table 1 COMPARISON OF YIELDS I N CEREALS, COLON FARMS, TUNISIAN PRIVATE SECTOR AND UCP1s, 1937-1975. Hard 1/ - Wheat- 1937-41 Average Yields : Colon Farms Tunisian Farms 1950-54 Average Yields : Colon Farms 11.6 Tunisian Farms 4.6 2/ re-1962- Average Yields : Colon Farms Tunisian Farms 1962-67 Average Yields : urn 11.2 All Northern Tunisia-3/ 5.7 1967-68 Average Yields : UCP' s 6 5 A l l Northern T u n i s i d 4.5 1970-75 Average Yields, UCP' s 12.4 1/ Excludes Mexican o r h i g h yielding v a r i e t i e s . - 'T/ Exact dates not defined, though presumably about 1960. - 3/ Including UCP1s, which i n 1969 about 15% of northern land planted i n hard wheat, 53% of northern lands planted i n s o f t wheat, and 3% of northern lands planted i n barley. Since t h e UCP y i e l d s a r e higher than t h e northern averages t h e e f f e c t of t h e inclusion o f t h e UCP y i e l d s i n t h e average f o r Northern Tunisia was t o increase i t s l e v e l . - 4 Including oats, which has a lower y i e l d per ha. than barley; thus t h e effect of t h e inclusion of o a t s i n t h e average i s t o decrease i t s level. - Source: Data f o r 1937-41, 1950-54, and t h e U CP y i e l d s f o r 1967-68 from Les Cooperatives k r i c o l e s de Production en Tunisie. O t h e r d a t a f r o m OTD/BC.  ?*la 1 AREA, PRODUCTION AND YIELDS FOR WHEATS, MRLE!l AWD OATS, IWD ?ULSES. UCPS. 1967175 5 Area Production Yield Area m Procbctim T Yield HEXICAY SIT WHEPT AND OATS AreaProduction Yield Brea Production Yield PULSES ALL LISTED CROPS Area Production Yield - Area 3( Improved v a r i e t i e s of hard wheats replaced much of t h e acreage i n t h e previous v a r i e t i e s of hard wheat. The area, production and y i e l d s f o r Yzie? t h e new high y i e l d i n g v a r i e i t i e s of hard wheat were as follows: 1973 -74 ,, Pr;$;zn Projected Higher y i e l d i n g v a r i e t i e s . Source : OTD/BC.  63 - -Table 1 ANNEX 15 ARM eE;WTgD I N DIFFERBNT CROPS BY UCP' S. I974 - CROP T mWA ~LINTP33 (ha ) AVEEfAGE PFR UCP J l I. Rainfed Cereals, Total Hard wheat Soft wheat, Mexican Soft wheat, ordinary Barley Oats 11. I r r b a t e d Cereals. Total Hard wheat Soft wheat Others 111. Rainfed Forrwe Crms. Total 24,853 103 Oats and Vetch 18,187 76 ~rge en Vert , 2 656 12 4l Ber sim 797 4 9ulla and others 3,2U l-4 IV. I r r i a a t e d Forrage Crops. Total Annual 1,100 616 4.9 Y 2.7 Perennial 484 2.1 V. Leaw~es(~ea s Beans). Total and 9,882 Broad beans (feves) 1,016 Feverole s 4,464 Chick peas Vetch 17 Green peas 1,015 Lentils and others 246 VI. Irrirrated Vegetables. Total 1,073 4.5 Potatoes 79 3 Artichokes 224 .9 Pimentos and Tomatoes 311 I.*3 Squash and Melons 281 1.2 Others 178 7 I . I n d u s t r i a l Crops, Total Sugar Beet Wlower Linseed VIII. Wee Crops, Total 31,453 131 J l A l l averages f o r 241 UCP' 8 unless otherwise indicated. J 2 Nabeul excluded i n averages for Total and allwheats; averages f o r these &tens based on 226 UCP' s. 5 Nabeul excluded in a l l averages i n t h i s section; averages f o r 226 UCP's. Nabeul e u l u d e d i n amage for a i t e m s based on 226 UCP' s. ( F en nut, -sin and sulla; averages f o r theae Beja only (average f m 19 OW'S) 1 a z e r t e and Beja only (average f o r 72 OW'S ) I/ Beja and Jendouba only (amrage f o r 70 UW' s ) Source : OTDIBC.  - 44 -. ANNEX 16 Table 1 AVERAGE INCOME PER COOIERATEITR, 1962-74 (in dinars) 1 (of which D 18.0 i n cash)- / 76 66 (D 3.3 i n cash) 82 ( D 10.7 in cash) 60 (D 8.4 i n cash) 77 (D 10.8 i n cash) n.a. n.a. 187 ( a l l cash) !I 235 I1 252 11 2 74 - 1 / demaining non-cash income f o r years 1962-67 given i n kind; i n addition an average of D 1 6 was earned from r e n t by the owners of private lands i n 1962-63, D 22 i n 1963-64, D 6 i n 1964-65, and D 5 i n both 1965-66 and 1966-67. Source: Les Cooperatives Agricoles de Production en Tunisie (1962-67) and OTD/BC (1969-74). Table 2 AVERAGE INCOME PER COOPERATEUR. BY REGION * 1969-1973 Le Kef Jendouba Bizerte Mateur Mediez Tunis Ee ! j .a Nabeul Average 1969-70 227 194 181 - - I-43 193 189 187 * In 1971-72 t h e system of grouping t h e UCP's w a s changed; thus t h e names f o r t h e pre-1971 regions (gouvernorats) a r e d i f f e r e n t than the post-1971 names ( d i r e c t i o n s regionales). Source: OTD/BC.  I ' Table 1 . ! PROJECT IDENTIFICATION, DESIGN AND APPRAISAL MISSIONS b!ONTH/Y EAR TYPE of MISSION H of DAYS # of PEOPLE - # of PERSON-DAYS - December 1963 - -' Identification 7 -I 1 [m'inimum) October 1964 Iderltification (FAO) 4 100 - 25 7ebruary 1365 Discussions in Rome w/ FA0 Officials 2 2 (minimum) 7 April 1965 Identification (FAO) 1 I?) 12 July 1965 Design (FAO) - 12 2 44 _1 22 .- Octobcr 1965 Appraisal (I) 4 27 - Re-design (livestock) 2 108 -. January 16i6 . - . 10 1 20 -- March 13Gb Re-design 15 5 June 1966 Appraisal (11) 4 - 21 74 -- - February 1967 Loan/Credit Agreement bhy 1967 ~ssistzccin Preparation of Documents - 2 -- 9 18 July 1967 Date of Effectiveness ' - \ .. Source: IBRD/IDA Documents, 1963-196.7. 4 TUNISIA COOPERATIVES PROJECT: ~ ~issions> A n a l y s i s o f Frequency and Length o f Missions by I B R D Personnel f ~ x c l u d i nFA0 T o t a l number o f IBRD personnel p a r t i c i p a t i n g i n p r o j e c t i d e n t i f i c a t i o n . design. a p p r a i s a l and s u p e r v i s i o n m i s s i o n s ...................................... 20 T o t a l number o f m i s s i o n s made by a l l p e r s o n n e l ................ 43 Average number o f missions made by each person ................ 2.2 Number o f p e o p l e making one mission ........................... 11 (55%) Number o f p e o p l e making two m i s s i o n s .......................... 6 (30%) Number of people making o v e r two m i s s i o n s ..................... 3 (15%) (One person made f o u r missions; One person made seven missions; One person made t e n missions) T o t a l number o f days s p e n t by IBRD p e r s o n n e l on missions ................................................... 619 Total number of days spent by IBRD personnel on: ( P r o j e c t i d e n t i f i c a t i o n ; d e s i g n and a p p r a i s a l ................. 216) S u p e r v i s i o n . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 403) T o t a l number o f IBRD m i s s i o n s ................................. 22 Average number o f person-days p e r m i s s i o n ..................... 28 Average number o f days p e r p e r s o n p e r mission ................. 13 Source: IBRDIIDA documents. 1964.74 . Annex 18  SELECTED BIBLIOGRAPHY The main sources of data and information for this audit were: (1) GOT and IBRD/IDA documents; (2) interviews with GOT and IBRD/IDA officials; (3) interviews with Tunisian private farmers, cooperateurs, season- al farm workers, and scholars; and (4) published articles and reports. The following list includes the main published sources which were consulted. Ben Salem, Lilia. 'L'encadrement des Unites de Production Agricole.' Revue Tunisienne de SciencesSociales . No. 26, September 1971, pp. 115-162. Grissa, Abdessatar. Politiques Agricoles et Emploi, Etude de Cas: La Tunisie. Centre de Developpement de llOrganisationde Cooperation et de Developpement Econornique, Etudes sur llEmploi, 9. Paris, 1973. Haraguhi, Takehiko. "Reforme Agraire en Tunisie: Quelques Aspects Socio- Economiques de 1'Unite de Production." Revue Tunisienne de Sciences Sociales. No. 12, January 1968, pp. 89-120. Les Cooperatives Agricoles de Production en Tunisie: Une Experience d' Agriculture Collective. Institut National de la Recherche Agronomique, Republique Francaise. Bureau de Controle des UCP du Nord and Chaire DIEconomie Rurale de la Faculte dlAgronomie Republique Tunisienne. Premiere Partie: Donnees et Methodes; Deuxieme Partie: Resultats. April, 1970. Makhlouf, Ezzedine. "Les Cooperatives Agricoles en Tunisie: Structures et Difficultes." Revue Tunisienne de Sciences Sociales. No. 26, September 1971, pp. 79-114. 'Nouveau Dualisme de llAgricultureTunisienne: Cooperatives Agricoles de Production et Grandes Exploitations Privees. eke ~unisiennede Sciences Sociales. No. 9, March 1967, pp. 27-56. Structures Agraires et Modernisation de LIAgriculture dan les Plaines du Kef: Les Unites Cooperatives de Production. Centre D'Etudes et Recherches Economiques et Sociales, Tunis, January 1968. Naccache, Gilbert. "Les cooperatives de Production du Nord: Revue Tunisienne de Sciences Sociales. No. 12, January 1968, pp. 141-160. Rich, Michelle. Observations on the Structure and Incentives of Tunisian Cooperatives. Internal Report # 3 . Sarvard University Research Project in Forth Africa. Sidi 30u Sail, Tunisia, Fe5ruary 15, 1967. Simmons, John. "Agricultural Cooperatives and Tunisian Development." Middle East Journal. Part I: Vol. XXIV. Autumn, 1970, pp. 455-465. Part 11: Vol. XXV, Winter,ll971, pp. 45-57. Land Reform in Tunisia. Agency for International,Development, Spring Review Washington, D. C., June 1970. Zamiti, Khalil. "Les Obstacles Materiels et Ideologiques a llEvolutionSociale des Campagnes Tunisiennes: LIExperiencede Mise en Cooperatives dans le Gouvernorat de Beja." Revue Tunisienne de Sciences Sociales. No. 21, May, 1970, p ~ 9-55. p Zghal, A. Changement de Systemes Politigues et Reformes des Structures Agraire en Tunisie." Revue Tunisienne de Sciences Sociales, No. 12, January, 1968, pp. 9-32.