Announcement of Bolivia Receives Eighteen Million Dollars for Rural Development on January 16, 1978

I. , -World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 BANK NEWS RELEASE NO. .78/35 IDA NEWS RELEASE NO. 78/32 JanuarJ 16, 1978 BOLIVIA RECEIVES $18 MILLIOM FOR RURAL DEVELOPMENT Bolivia's efforts to reduce severe poverty in the Altiplano region of the country will be assisted by a combined loan and credit totalling $18 million from the World Bank and its affiliate, the International De- velopment Association (IDA). The loan and credit will help finance a livestock development project that will set up an integrated system for the production, proces- sing and marketing of wool from alpaca and llama, including handicrafts. A speeial emphasis wi 11 be given to Ulla Ulla, a major alpaca raising re- gion, in the Altiplano. This is an area where poverty and underemployment •• sre most widespread, and livestock offers good potential for development . Apart from the alpaca/llama agri-business complex, the project will provide credit to small-scale farmers for on-farm development and farm management as well a~ extension and veterinary services. It will also provide credit to artisans involved in the manufacturing of alpaca/ llama/sheep wool handicrafts. The project will finance trye development of solar energy devices for use in the rural areas of the Altiplano where this energy is an important natural resource. In addition, efforts will be made to improve social conditions in the Ulla Ulla area, including programs to assist women to improve and develop basic skills. This is the second rural development program in Bolivia being sup- ported by the World Bank. It forms part of a concerted, comprehensive effort by the Government to find ways of improving the economic and social conditions in the Altiplano region. The total cost of the project is estimated at about $24 million. The World e~~k loan of $9 million is for a term of 20 years, including five years of grace, at 7.9 percent per annum. The lOA credit, also $9 million, is on standard terms of 50 years, with a 10-year period of grace, at no interest except for a charge of 3/4 of l percent for administrative expenses • • NOTE: Money figures are expressed in U.S. dollar equivalents. FOAM NO. 1121 (5-76) •• T E C HN I CA L DA T A PROJECT: Ulla Ulla Development COUNTRY: Bo 1 i vi a TOTAL COST: $24.0 mi 11 ion BANK FINANCING: $9.0 million for 20 years, including 5 years grace, at 7.9 percent per annum. IDA FINANCING: $9.0 million on standard IDA terms OTHER FINANCING: Government of Bolivia IMPLEMENTING ORGANIZATION: The National Institute for the Development of Wool (INFOl.), ta Paz, Bo 1 iv i a PROJECT DESCRIPT!ON: The project will help set up an integrated system for the production, processing and marketing of alpaca/llama/vicuna wool with the objective of raising the income levels of poor farmers and artisans. It • will also complement the directly production-oriented activities with p·roduction support and social infrastructure investment to improve the quality of life of the alpaca/llama farmers in trye Ulla Ulla region. PROCUREMENT: New equipr.ient for the processing plant ($2.5 mi 11 ion), road construction and maintenance equipment ($300,000) and vehicles ($261,000) will be acquired through internatio~al competitive bidding according to Bank/ IDA procurement guidelines. Equipment for llama dehairing research facilities will be procured on a negotiated basis. INFOL will coordinate the requirements of the participa- ting agencies and issue the calls for tenders. All tender packages for equipment in excess of $100,000 will be procured through international competitive bidding in accordance with Bank/lDA procedures. Furniture and office equipment will be procured through local com- petitive bidding according to local procedures which are satisfactory to the Bank. Pro- curement of most handicraft and farm inputs will be carried out by farmers through normal comnercial channels. Road work will be undertaken by the Nationai Roacis Service (SNC) on force account. Civil works contracts will be awarded after local competitive bidding. CONSULTANTS: 25'• man-months of consultant services will be needed for various project components including provi~icn of technical know-how and implementation of control programs for a new wool processing plant in La Paz as wel 1 as a training program for plant personnel. ECONOMIC RATE OF RETURN: 25 percent ESTIMATED COMPLETION DATE: 1982 - 0 - •