Announcement of IDA Provides Twelve Million Dollars to Somalia for Bay Region Agricultural Development Project on December 28, 1979

· . IMMEDIATE RELEASE .FOR ' 9v'Vorld Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 I DA NEWS RELEASE NO. 80/22 December 28, 1979 IDA PROVIDES $12 MILLION TO SOMALIA FOR BAY REGION AGRICULTURAL DEVELOPMENT PROJECT The International Development Association, the soft-loan affiliate of the World Bank, has approved a $12 million credit to support an agricul- tural development project in Somalia's Bay Region. The project, the total cost of which is estimated at $43.4 mill ion, aimsr to increase crop and livestock production in the Bay Region over a six- year period. Potable water supplies and all-season access roads will be provided, and a viable farming system wi 11 be developed. Institutions capable of carrying on agricultural development will be built, and Somalis will be trained to manag~ the agricultural program and institutions. The project is expected to be the first phase of a long-term development program; it includes funds for the preparation of a follow-up phase. ~ About 15,000 farm families engaged in subsistence crop and livestock production are expected to benefit directly by the tenth year of the project, and over 45,000 additional families thereafter. The increased crop and live- stock production resulting from the project will allow the average family in the Bay Region to meet basic food requirements and increase its marketable surplus. The average per capita income is expected to rise from $95 to $120 a year after 10 years. Through the provision of roads and potable water, the project will also benefit non farm families and will help to transform sub- sistence agriculture to a more market-oriented activity. The road component will also benefit regions to the north and west of the Bay Region. Improved farming practices and range management will help to maintain the productive potential of the land and wi 11 minimize the environmental risks inherent in water development without strict control over animal numbers. Co-financing for this project is being provided by the African De- velopment Fund, $8.9 million; the International Fund for Agricultural Develop- ment, $8 mill ion; and the U.S. Agency for International Development, $10.5 mi 11 ion. The $12 million IDA credit to Somalia is for 50 years, including 10 years of grace. It carries no interest, instead a service charge of 3/4 of 1% will be made to cover administrative costs . • NOTE: Money figures are expressed in U.S. dollar equivalents. FOAM NO. 1121 (5-76) T ECHNI CAL DAT A PROJECT: COUNTRY: Bay Region Agricultural Development Somali Democratic Republic • TOTAL COST: $43.4 mi 1 lion IDA FINANCING: $12 mill ion, standard IDA terms OTHER FINANCING: African Development Fund (ADF), $8.9 million; International Fund for Agricultural Development, $8 million; U.S. Agency for International Development, $10.5 mill ion; the Government of Somalia, $4 million. IMPLEMENTING ORGANIZATION: Project Management Unit (PMU) Bay Region Agricultural Development Project Ministry of Agriculture Mogadishu, Somalia PROJECT DESCRIPTION: It aims, over a period of six years, to increase crop and livestock production in the Bay Region by: (1) improving potable water supplies and providing all-season access roads; (2) supporting the development of a viable farming system that will preserve the productivity of the land; (3) training Somalis; and (4) helping to build institutions capable of carrying on the agricultural development so initiated. The project will be the first phase of a long-term development. It includes funds for the preparation of a follow-up phase.~ PROCUREMENT: Contracts for the supply of vehicles, machinery and equip- ment, and materials and supplies in excess of $50,000 will be subject to international competitive bidding (ICB), in accordance with World Bank procurement guidelines. Orders will be bulked whenever possible to attract the highest possible number of bidders. Draft tender invitations and bid will be submitted to IDA for review. Contracts for $50,000 of less, but in aggregate totaling no more than $300,000, will be awarded after competitive bidding advertised locally and following government procurement procedures which are satisfactory to IDA. The construction of housing and office facilities at Baidoa and Bonka will be combined into a single contract and tendered under ICB. Domestic manufacturers will be granted a preference margin of 15% over the c. i .f. price of imported goods, and Somali contractors will be granted a 7.5% preference margin. Since building contracts outside Baidoa and Bonka will not attract international bids due to their small size and dispersed loca- tions, they will be awarded to local contractors in accordance with government procure- ment procedures which are acceptable. CONSULTANTS: About 20 internationally recruited specialists, representing a total of 100 man-years,will be required. A Project Director, the Project Technical Manager, and Financial Controller of the PMU wlll be appointed after consultation with IDA on terms of reference and with qualifications satisfactory to the Association. All other technical staff for the project financed out of the IDA credit or the ADF loan shall be appointed after consultation with the Association. Training abroad will be planned and organized by the Project Director and Project Technical Manager; they will prepare a plan satisfactory to IDA for the • overseas training of Somali staff by June 30, 1980. ECONOMIC RATE OF RETURN: 20% ESTIMATED COMPLETION DATE: 1987 - 0 -