Senegal - Dakar Container Port Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. P-3706-SE REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDIT OF SDR 2.6 MILLION AND A PROPOSED SPECIAL FUND CREDIT OF SDR 4.7 MILLION TO THE REPUBLIC OF SENEGAL FOR THE DAKAR CONTAINER PORT PROJECT March 29, 1984 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.  CURRENCY EQUIVALENTS Currency Unit = CFA Franc (CFAF) US$1 = CFAF 392 CFAF I m = US$2551 SYSTEM OF WEIGHTS AND MEASURES (METRIC) Metric British/US Equivalent 1 meter 3.28 feet (ft.) 1 square meter (m2) 10.76 square feet (sq. ft.) 1 cubic meter (m3) 35.50 cubic feet (cu. ft.) 1 kilometer (km) 0.62 mile (mi.) 1 square kilometer (km2) = 0.39 square mile (sq. mi.) 1 hectare (ha) = 10,000 m2 = 2,47 acres 1 metric ton (t) 2,205 pounds (lb) ABBREVIATIONS AND ACRONYMS ACC Agent Comptable Central BADEA Banque Arabe pour le Developpement Economique en Afrique BMOP Bureau de Main d'Oeuvre Portuaire BOM Bureau d'Organisation et Methodes CCCE Caisse Centrale de Cooperation Economique CEP Centre des Etablissements Publics CIF Cost, Insurance and Freight CVCCEP Commission de Verification des Comptes et de Controle des Etablissements Publics DSP Directorate of Studies and Programming, Ministry of Equipment DWT Dead Weight Ton EPIC Etablissement Public a Caractere Industriel et Commercial GDP Gross Domestic Product GRT Gross Registered Tonnage ICS Industries Chimiques du Senegal INNA/DPB Association Internationale des Aides a la Navigation/Direction des Phares et Balises (France) KF Kuwait Fund for Arab Economic Development KfW Kreditanstalt fUr Wiederaufbau (German Aid Agency) LCL Less Than Container Load LLW Lowest Low Water ONCAD Office National de Cooperation et; d'Assistance pour le Developpement PAD Port Autonome de Dakar PAM Port Autonome de Marseille RCFS Regie des Chemins de Fer du Senegal SEFICS Societe d'Exploitation Ferroviaire des ICS SEMPAO Syndicat des Entreprises de Manutention des Ports d'Afrique Occidentale TEU 20' Equivalent Unit Container FISCAL YEAR of PAD July 01 - June 30  FOR OFFICIAL USE ONLY SENEGAL DAKAR CONTAINER PORT PROJECT CREDIT AND PROJECT SUMMARY Borrower: Government of Senegal Beneficiary: Port Authority of Dakar Credit Amount: SDR 2.6 million (US$2.65 million equivalent) from IDA. SDR 4.7 million (US$4.85 million equivalent) from the Special Fund administered by IDA. Terms: Standard Relending Terms: At current IBRD interest rate -- 20 years, includ- ing four years' grace. Project Description: The primary project objective is to reduce freight costs for Senegal's external trade and enhance Dakar's position as a port of transfer for neigh- boring countries by provision of additional facil- ities and rehabilitation of existing ones and by strengthening the Port's management and opera- tions. The project provides for (i) construction of new infrastructure for container handling, including construction of a 430 m long quay wall, reclaiming of an 8.2 ha area for container hand- ling, paving and installation of related utili- ties; (ii) rehabilitation of some port facilities; (iii) consultant services and technical assistance for project supervision, financial management and operations, information systems and procedures, and tariff and port management studies; and (iv) training of port staff in operations, management and finance. Benefits and Risks: The quantifiable economic benefits from the pro- posed project include savings in ship service time and in handling costs stemming from more efficient operations resulting from the project and avoid- ance of double handling of containers which would have resulted due to saturation of existing port storage areas. Costs include physical construc- tion costs, incremental maintenance and all asso- ciated capital costs, i.e., project supervision, 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.  training and studies, representing 90% of total project costs. On the basis of a 25 year economic life, the proposed project yields an economic rate of return of 23%. There are no significant economic risks associated with the project since the larger part of project construction costs are based upon actual bid prices. Additionally, adequate safeguards have been taken to ensure that the new terminal will be efficiently operated and that expected benefits will materialize. On the financial side, the Port's finances are sufficiently robust to with- stand reduced leveLs of tariff charges and a drop in forecast traffic. The base financial analysis has been tested under adverse conditions of traf- fic, tariff and operating cost changes which show that the downside risk is minimal. The main risk is ultimately institutional in that PAD's internal structure may not develop as envisaged and that, as a result, PAD's management would not improve to the extent forecast. The provision of technical assistance and the action plan measures to be taken early in the project would minimize this risk. Estimated Cost: ---I$M;11ions- -.cal Foreign Total i. Civil Works 2.53 9.13 11.66 ii. Consultant Services 0.14 0.99 1.13 iii. Technical Assistance 0.10 1.20 1.30 iv. Training -- 0.13 0.13 v. Deferred Maintenance 0.44 0.19 0.63 Base Cost (Feb. 1934 prices) 3.21 11.64 14.85 Physical Contingencies 0.43 1.72 2.15 Price Contingencies .63 2.C0 2.63 Total Preect Cost (Net of Taxes) 4.27 15.36 19.63 Taxes and Duties 5.55 __ 5.55 Total Project Cost 9.82 15.36 25.18 Interest d-uring Construction 1.23 1.14 2.37 TOTAL F2ACING REQU= 11.05 16.50 27.55  - iiil - Financing Plan: U$ MXiIJons- Local Foreign Total Special Fund Admin;stered by MA - 4.85 4.85 IDA - 2.65 2.65 CCCE 1.8) 4.85 6.65 Kuwait FTmd 1 .08 3.01 4.09 Total External Sources 2.88 15.36 18.24 PAD 8.17 1.14 9.31 TOML 11.05 16.50 Z7.55 Estimated Disbursements of Special Fund Administered by IDA: - US$ Millionc FYB5 FY86 FY_7 _ Amual. - 1.4 2.6 0.85 Cumulative - 1.4 4.0 4.85 Estimated IDA Disbursements: -U$ Millions- FY85 FE36 FY_7 _ FY_9 Am2al 0.7 1.1 0.6 0.15 0.1 Gumulative 0.7 1.8 2.4 2.55 2.65 Economic Rate of Return: 23% Staff Appraisal Report: Report No. 4625-SE, dated March 29, 1984 Maps: IBRD 17165 Port of Dakar -- Existing Port and Approaches IBRD 17166 Project Detail   INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDIT AND SPECIAL FUND CREDIT TO THE REPUBLIC OF SENEGAL FOR THE DAKAR CONTAINER PORT PROJECT 1. I submit the following report and recommendation on a proposed Development Credit to the Republic of Senegal for SDR 2.6 million (US$2.65 million equivalent) on standard IDA terms and a proposed Special Fund Credit administered by IDA of SDR 4.7 million (US$4.85 million equivalent) on terms adopted by the Executive Directors of IDA 1/ to help finance the Dakar Con- tainer Port Project. The Caisse Centrale de Cooperation Economique (CCCE) of France would make a loan of FF 52 million (US$6.7 million equivalent) for 17 years, including four years of grace, at 7% per annum. The Kuwait Fund for Arab Economic Development (KF) would make a loan of KD 1.3 million (US$4.1 million equivalent) for 20 years, including five years of grace, at 4% per annum. PART I - THE ECONOMY 2/ 2. A report entitled "The Economic Trends and Prospects of Senegal" (1720a-SE) was distributed to the Executive Directors on March 10, 1980, followed by a President's Report for a Structural Adjustment Loan/Credit (P-2869a-SE) dated November 26, 1980, which contained an expanded section on the economic situation. . A new Country Economic Memorandum on Senegal is currently being prepared. Country data appear in Annex I. Economic Structure and Past Developments 3. Three-quarters of Senegal's territory lies in the Sahel zone, which suffers from low rainfall and periodic droughts. The mainstays of the tradi- * tional economy are millet cultivation and nomadic cattle-raising for domestic consumption, and groundnut cultivation for exports. The modern sector of the 1/ Resolution No. IDA 82-6 of October 26, 1982. 2/ The text of this Section remains substarntially unchanged from that included in the President's Report for the Fifth Highway Project which was distributed to the Executive Directors on February 23, 1984.  economy is concentrated in Dakar, the capital, a city of over one million inhabitants, the economic base of which consists of excellent port facilities, an important industrial sector, and a small but fast-growing tourism indus- try. With a population of 6.0 million in mid-1982, Senegal's per capita GNP for 1982 was estimated at US$440. 4. At Independence in 1960, Senegal lost its privileged position as the center of French West Africa, and subsequently has had to adapt to reduced economic, administrative and political circumstances. In the latter part of the 1960s, income from groundnuts (the principal export) fell due to unfavor- able weather and declining export prices as a result of loss of EEC special preferences. Over the decade, the Senegalese economy experienced virtual stagnation as real output increased at a rate! estimated at 2.5% per annum, hardly more than the rate of population growth. 5. During the 1970s, Senegal's groundnut production was again hit by sharp climatic fluctuations, and even with higher rates of pri-vate and public investment, average annual growth did not rise above the level of the previous decade. Buoyed by a series of good harvests andi relatively high international prices, real GDP increased at about 5% a year between 1973 and 1977, but declined by 2% a year between 1977 and 1981 , reflecting the effect of three severe droughts during this period. A marked recovery from the previous depression occurred in 1982 with an estimated 10% real growth in GDP. Results of the 1982/83 agricultural season were also good, leading to an estima-ted 3% growth of GDP in 1983. However, indications for the 1983/84 crop year suggest a disastrous groundnut and cereal harvest, due to another severe drought in the Sahel region this year. The FAO has recently estimated Senegal's food aid requirements for 1984 at over 250,000 tons and is coordinating pledges for the additional aid required. 6. Fluctuations in physical output have been aggravated by the price volatility of Senegal's major exports and imports. For example, in 1974, the terms of trade improved by over 21% due to exceptionally high prices for phosphate rock, Senegal's second export commodity; however, in 1975, export prices for groundnuts declined sharply, followed by a decline in export prices for phosphates since 1976. Increases in oil and rice prices brought a further deterioration in the terms of trade, causing a total loss in income of roughly 6% of GDP between 1974 and 1982. This deterioration in terms of trade, along with the unsatisfactory performance of the economy as a whole, led the Govern- ment to launch an economic and financial stabilization program in 1980. The main objectives of the Government' E five-year program were to stabilize the economy during the first two years and to achieve an economic growth rate of 4% per annum in the following three years. This program was supported by an Extended Fund Facility (EFF) of US$243 million equivalent approved by the IMF in August 1980, and a US$60 million Structural Adjustment Loan/Credit (SAL) approved by the Bank in December 1980. 7. The structural adjustment program consisted of an economic stabili- zation plan (agreed with and monitored by the IMF), introduction of new produ- cer incentives, reorientation of the public investment program, a change in  the national policy on parastatal enterprises, and a package of structural reforms in the agricultural sector. Despite delays caused by a record low 1980/81 groundnut crop and by the change of government in early 1981 , the Government achieved significant progress in arrears reduction, investment pro- gramming, parapublic sector management and industrial incentive policies. However, in other areas, and especially in the reform of agriculture policies and control of government expenditure, action was disappointing. Balance of Payments 8. The new balance of payments policies introduced under the 1980 stabilization program were based on strict control of overall demand through import tax and consumer price increases, combined with increased producer prices for major export crops and the introduction of special incentives for manufactured exports. However, the hoped-for reduction in the trade balance could not be achieved, mainly because of the 1980/81 drought and difficulties in implementing reforms in groundnut marketing. The fall in groundnut oil and seedcake exports from a past five-year average of US$220 million/year to US$94 million in 1980 and US$34 million in 1981 , together with exceptionally high import bills for petroleum and rice, increased the current account deficit in 1981 to US$590 million, or 23% of GDP. In 1980 and 1981, the Government received exceptional aid averaging US$170 million a year from bilateral and multilateral donors. Even this, however, was insufficient to avoid a further fall in net foreign assets, from US$80 million in 1980 to a level of negative US$460 million at the end of 1981. The resource gap was estimated at 20% of GDP in 1981, narrowed to 14% in 1982, and is estimated at about 13% for 1983. Good rainfall during the 1981/82 growing season permitted a five-fold increase in the 1982 value of groundnut exports, despite exceptionally low world market prices for vegetable oils. However, the CFAF value of imports rose by about 13%, despite the policy measures introduced to contain urban demand. With total imports for 1983 estimated at about 42% of GDP (as com- pared to around 30% in the early 1970s), further economic adjustment needs to be achieved in the coming years, in order to reduce the current account def- icit to a level which can be financed on acceptable terms. This will have to be achieved mainly through containment of consumption levels, and improved investment efficiency, and through food import substitution and strong promo- tion of non-agricultural exports. Producer and Export Incentives 9. The structural adjustment program addressed the need to improve the country's trade balance by increasing the basic rate of import duties from 10% to 15% of f.o.b. value and by introducing an export premium system for certain manufactured goods. The export premium system has already had a positive impact on export and employment levels in the five industries to which it was applied, especially fishing. An extension to 20 other agricultural and indus- trial branches, as well as a refinement of the payment system, is being imple- mented during the current fiscal year. To contain imports, in February 1982 the Goverrnment adopted a 31% lncrease in the official consumer price for rice, which was again raised substantially (24%) in August 1983, in order to reflect  - 4 - increased import costs and to provide a measure of protection for domestic cereal production. The net producer price for groundnuts was increased sub- stantially in 1981 but has subsequently had to be reduced in order to limit the losses borne by government on both input and output marketing operations. Public Finances 10. Although the Government successfully implemented a 1981/82 Standby Arrangement with the IMF, the new program initiated in 1982/83 could not be completed due to the Government's inability to restrict domestic credit growth, to remain within public borrowing targe)ts, and to reduce its payment arrears. This was partly due to an unforeseen 50% drop in export prices for groundnut products and to a less-than-expectecl inflow of foreign budgetary support. In August 1983, the Government signed a new Standby Program with the IMF for the current 1983/84 fiscal year, under which it is committed to ob- serving strict limits on civil service recruitment, new foreign borrowing, domestic credit expansion, and public sector payment arrears; the Government is also repaying a large volume of outstanding crop credit and ONCAD debts held by the commercial banks. As part of the austerity program, in August 1983 the Government announced a series of sharp increases in domestic consumer prices for rice, vegetable oils, and petroleun products. Even with these improvements in fiscal performance, however, the! Government will be left with a financing gap equal to roughly 10% of the FY84 budget and the outlook for 1984/85 is even less encouraging, given the extremely poor groundnut crop expected this year. It appears unlikely that by 1985 the Government will be able to finance from budgetary savings 25% of the public investment program, the target the Government set itself in the original structural adjustment program. A major constraint on the Government's finances is the serious and growing burden represented by service of the external debt, which amounted to US$1.4 billion in June 1983. In November 1982, the Government was required to obtain from the Paris Club a second debt rescheduling and agreed on a third round of rescheduling with the Paris Club and commercial banks in December 1983. Investment Program 11. The outlook for the national investment program has deteriorated dramatically since establishment of the structural adjustment program in 1980. While the latter imposed ceilings on the investment program to re- establish macroeconomic equilibrium, implementation of even the reduced pro- gram has become problematic. Private investment has stagnated and public investment is suffering from financing problems because the country is not creditworthy for foreign commercial loans, and domestic credit expansion has to be constrained. In the present climate, a carsful screening of new invest- ment projects according to economic criteria is especially needed, together with an increased attention to rehabilitation and. maintenance needs of exist- ing assets.  Parastatal Sector 12. Reform of the large parastatal sector in Senegal continues to be a high government priority. Over the last three years the Government has taken significant steps to reduce the budgetary burden presented by non-viable enterprises (through the liquidation of close to 20 comparies) and has trans- ferred ownership of several other companies to the private sector. For some of the remaining public enterprises, the Government has moved to increase managerial autonomy by negotiating multi-year contrats-plan which set clear financial objectives for company operations and spell out the reciprocal obligations of the Government and enterprise managers. 13. To date, the Government has signed six contrats-plan and several others are well advanced. The main objective of the Second Parapublic Tech- nical Assistance Project, approved by the Board in July 1983, is to provide technical assistance to 12 public enterprises for the development cf rehabili- tation programs, which can serve as the basis for realistic contrats-plan, and to strengthen the institutional framework for contrats-plan monitoring in support of Government efforts to improve the financial performance of the parastatal sector as a whole. These objectives are also supported by other projects in the Bank's lending program, including the proposed Technical Assistance Project for Urban Management and Rehabilitation. Long-term Prospects 14. The Government's long-range development strategy continues to be based on the promotion and diversification of agricultural and export-oriented activities. The agricultural program calls for the development of areas less susceptible to drought (Casamance and Eastern Senegal) where cash crops other than groundnuts can be grown, and increased incentives for domestic millet production to replace imported rice. Agricultural research will be oriented more to farming systems than to individual crops, with the objective of lower- ing the costs of yield-raising agricultural techniques and better adapting them to farmers' constraints. Irrigated cereal production is being developed in the arid northern part of the country along the Senegal River. Construc- tion has started on the two large dams planned for the Senegal River by the Organisation pour la Mise en Valeur de la Vallee du Senegal (OMVS), but the high level of state subsidies required on irrigated rice will severely con- strain the pace of new irrigation development. 15, The phosphoric acid and fertilizer project is now well advanced, and the combination export subsidy/import duty increase designed to effect a realignment of the Senegalese CPA currency should help to attract more light export industries once the international economy has improved. However, in the medium-term, at least, export diversification is unlikely to offset the uncertain prospects for groundnuts, still Senegal's main export commodity. Groundnut oil exports suffer from irregular supplies and from an increased supply of competing vegetable oils; exports of groundnut cake have also been depressed due to the risk of aflatoxin contamination, which has resulted in the complete closure of some export markets. As a consequence, in the next  - 6 - few years, the share of total exports in GDP is expected to remain below the levels attained in the early 1970s. 16. The exceptional foreign aid granted to Senegal in support of the Government's 1980/85 stabilization program has helped the country survive in a period of extraordinary economic difficulty, but these efforts have not been enough to bring the economy back to a path of balanced growth. The over- extended public sector, as well as heavy domestic arrears and external debt service charges, continue to impose serious burdens on public finance and will make necessary further debt rescheduling. The Treasury will not be able to absorb substantial additional recurrent cost charges from development projects and will continue to need exceptionally high shares of foreign financing for the investment program. The unfavorable balance of payments situation calls for a reassessment of Senegal's longer term development strategy and the establishment of a new program of action to azhieve the required structural adjustments. The Bank will continue to focus its country dialogue on these problems and, in the interim, will finance its lending programi in Senegal on IDA terms. PART II - BANK GROIJP OPERATIONS IN SENEGAL 17. As of March 51, 1984, the Bank Group had approved 55 operations in Senegal for a total of US$551 .1 million, including 30 IDA Credits, 12 Bank loans, five blends of Bank and IDA funds, five IFC operations, two blends of Bank and IFC funds, and one blend of Bank, IDA and IFC funds. P'hysical execu- tion of projects is progressing reasonably well,, although some operations are affected by the shortage of counterpart funds due to the Government's continu- ing difficult public finance situation. Annex II contains the Status of World Bank Operations in Senegal. 18. Until a few years ago, our assistance was mostly project-oriented with a strong emphasis on diversification of the economy and improvement and expansion of basic infrastructure. The acuity of the financial crisis of the past two or three years has led to a major shif-t in our strategy, with empha- sis being placed on assisting the Government in (i) implementing investment policies and incentives to develop and diversify Senegal's production and export base; (ii) increasing the efficiency and savings capacity of the public sector; and (iii) redirecting investments towards rehabilitation and maintenance of existing social and economic infrastructure and developmental recurrent costs, rather than expansion investments. The Bank Group plans to continue financial and institutional support through project lending and technical assistance for operations or reforms that would encourage a stronger role for the private sector, as in the phosphate and petroleum industries. Bank Group operations now cover a wide spectrum cf sectors. 19. In agriculture, operations have aimed at improving productivity for traditional food and cash crops, together with diversification into new crops and new regions. In recent years, the portfo:Lio was somewhat modified by  -7- finarclng a forestry project and arn agricultural research project which focus- ses on improving agricultural systems. In August 1983, the Board approved a cotton/food crop project in the rainfed regions of Eastern Senegal and Upper Casamance. A dialogue is currently underway with the authorities on prospects for developing irrigated rice farming in the Senegal River Valley along the northern border of the country. The feasibility of new activities in the heavily-populated Groundnut Basin will depend on further progress with struc- tural reforms in input distribution, extension services, crop marketing, and agricultural credit. 20. Diversification has also been supported by lending to the growing industrial sector through the Societe Financiere Senegalaise pour le Develop- pement de l'Industrie et du Tourisme (SOFISEDIT), a development finance compa- ny established with Bank assistance in 1974, in which IFC is a shareholder and for which three lines of credit hEave been approved. The Bank has assisted in the realization of a major phosphoric acid/fertilizer complex by financing the rail infrastructure component; the project, for which IFC has been an impor- tant lender, is now well underway and commercial operations are expected to start in the fall of 1984. The Bank also responded to the effects of the past oil crisis by assisting the Government in its search for new energy re- sources: a petroleum exploration project was approved in FY83. Finally, diversification has been encouraged by assisting in the promotion and develop- ment of tourism, one of Senegal's major resources; a project, which consists of basic infrastructure and includes a line of credit to provide long-term financing as a catalyst for potential private investors in hotel construction, is virtually completed. 21. Past projects have strongly supported modernization and expansion of the country's infrastructure in a:Ll modes of transport: highways, rail, port and airport. But with a stagnant economy and heavy past investments, emphasis is now being placed on better utilization and maintenance of existing facili- ties. The recently approved Fifth Highway Project supports the Government's limited capacity to provide funds for priority maintenance, and the proposed Dakar Container Port Project presented in this report would also emphasize rehabilitation and maintenance. Similarly, the proposed Technical Assistance Project for Urban Management and, Rehabilitation emphasizes maintenance and rehabilitation of urban infrastructure in support of industrial development. 22. While Barik strategy has supported the emphasis on financing produc- tive projects and rehabilitation needs, it has also recognized the need to support the social sectors, with due consideration to the capacity of both the Government and users to bear the recurrent costs involved. In education, efforts have been directed at primary education and at technical and vocation- al training to support activities in the productive sectors. A health project directed at primary care in the rural regions was approved in FY83, and a water supply project in secondary centers is in the final stages of prepara- tion. 23. As it became increasingly clear that many of Senegal's economic and financial problems run across the board and could not be addressed exclusively  - 8 - through project lending, the Bank program began to shift in the late 1970s towards multi-sectoral technical assistance and structural adjustment lend- ing. In 1978, a technical assistance project was directed at improving the Government's knowledge and management of the parapublic sector. In July 1983, a second parapublic project was approved to help consolidate results already achieved and to begin rehabilitation of some key public enterprises through detailed action plans. Under another technica:L assistance project, assistance is being provided to the Ministry of Planning t:o prepare and select projects and to monitor the investment program. In December 1980, a structural adjust- ment program, supported by a Bank Loan and an IDA credit, aimed at supporting the Government's efforts to control aggregate demand, redireclt public invest- ments, and promote industrial exports and other productive act5.vities through improved price and incentive policies. The lDcal currency counterpart funds of the Structural Adjustment Loan were used fDr the financial rehabilitation of several parapublic enterprises which had agreed with the Government on contrats-plan. However, since the performance of the Government in some areas of its agricultural policy was deficient, the second tranche of the Structural Adjustment Loan was cancelled in June 1983. 24. Given the need to focus Senegal's public investment program on high- priority rehabilitation and maintenance needs and developmental recurrent costs, improved donor coordination is now assuming increased importance. The Bank is pursuing its economic dialogue with Senegal in close coordination with the IMF and bilateral and multilateral donors. In this connection, Senegal has requested the Bank to convene a consultative group meeting in the second half of 1984 to which it would submit its priority financing needs. The Bank is assisting the Government in preparing documentation for this meeting and is willing to play a major role in coordinating donor activity. The Bank is prepared to play an active role in aid coordination for Senegal, but on condi- tion that Senegal's expectations are realistic and that the aid coordination effort is based on extensive preparatory work. 25. The Bank Group's share in total external aid disbursements to Sene- gal over 1980-82 averaged approximately 18%, cf which roughly two-thirds was IDA-financed. The Bank Group's share in outstanding disbursed debt was 17% in 1980 and may approach 20% by 1985. The Bank Group's share in external debt service is expected to increase from 3.7% in 1980 to about 7.5% in 1985. PART III. THE TRANSPORT SECTOR Introduction 26. Senegal has a fairly well-developed transport system, whose main components, based in or linked to Dakar, serve also an important international transit function. The Senegalese road system, comprising about 14,000 km of roads (including 3,500 km paved), carries some 95% of all domestic traffic,. Over the past ten years, with relatively impressive investments, the road network has become one of the best in West Africa. The Senegalese Railway,  - 9 - covering about I ,000 km, has gradually lost traffic to road transport due in large part to operational inadequacies and the unreliability of its ser- vices. Currently, the railway handles mainly imports for Mali and short-haul phosphate exports, each accounting annually for some 140 million tons-km, while only some 10 million tons-kn correspond to general cargo and ground- nuts. Passenger traffic declined some 70% over the past decade. Coastal shipping and river navigation are also declining as better road connections are developed. The main international airport at Dakar experienced irmpressive traffic growth during the 1970s and was upgraded accordingly. The national airline, Air Senegal, plays a relatively minor role in domestic passenger transport. 2,. Dakar has a major international deep-water port located on the main international shipping routes connecting Europe with West and South African ports and the East Coast of South America. While its important bunker oil traffic has sharply dropped following reopening of the Suez Canal, as have transshipments of cargoes for Nigeria, its general cargo import traffic has grown slowly but steadily during the last decade, and container traffic has increased substantially during recent years. With continued development of container traffic, Dakar now has an opportunity to reestablish its position as one of the major ports of transit for West Africa. However, while the exist- ing port facilities are adequate to handle most general cargo and bulk traf- fic, they are inadequate to handle the increasing container traffic. The container handling facilities are practically saturated causing inefficient operations. Thus, while there is no ship-waiting time, service times are unnecessarily high. Sector Planning and Investments 28. Transport planning and coordination are shared by three agencies: the Ministry of Planning has overall responsibility for the preparation of the development plans; the Ministry of Equipment proposes and executes government policy and works in the transport sector; and the Ministry of Finance deter- mines investment ceilings, tax policy and allocations of operating funds. In 1981, a National Transport Plan was prepared with Bank assistance, as a first step in strengthening permanent planning institutions. It identified the priority projects for Senegal in all modes and made policy recommendations. Transport system planning can be considered generally adequate, although qualified staff is in short supply. 29. Investments in transport absorbed 21% of total public investment during the Fifth Plan period (1977-81) and a 16% allocation for the Sixth Plan (1981-1985) was foreseen. A significant scale-down of the Plan is likely inasmuch as financing has been secured for only some 25%, and the Government's transport strategy, with the Bank's encouragement, gives priority to maintain- ing the already extensive investments in the transport sector, improving efficiency, and focussing investments on renewals. This policy is particular- ly important in the current situation where the transport network is already well developed and where the Senegalese economy is in a crisis which does not allow generation of a surplus for investments or create additional demand for  - 10 - services. The recently approved Fifth Highway Project (exclusively for main- tenance) and the proposed Dakar Container Port Project (aimed at reducing the cost of Senegal's international trade and regaining its position as port of transit) support this investment strategy. 30. In addition to the Bank Group's activities, the Government has received external assistance for transport-related investments from several bilateral and multilateral sources including the Fonds Europeen de D'veloppe- ment (FED), the Federal Republic of Germany, the Saudi Fund, and commercial banks (for road construction); the Caisse Centrale de Cooperation Economique (CCCE) (for feeder road development, railways, and ports); the Arab Bank for Economic Development in Africa (BADEA) (for ports); and France (for avia- tion). Role of the Bank Group 31. The Bank Group adheres to the Government's policy of maintaining, rehabilitating and upgrading the transport irLfrastructure needed to support development of the productive sectors. Since the start of operations in Senegal in 1966, the Bank has invested about US$140 million under 13 loans/credits in addition to financing feeder roads under agricultural pro- jects. 32. Projects have been approved at an average rate of almost one per year, and there are now active operations in every sub-sector. Bank Group lending has helped finance: four railway projects (Cr. 96-SE, 1966; Cr. 314/Ln. 835-SE, 1972; Ln. 1518-SE, 1978; and Ln. 2025-SE, 1981); two projects in the aviation subsector (Ln. 867-SE, 1972, and Ln. 1665-SE, 1979); four projects in the road subsector (Cr. 198-SE, 1970; Cr. 366-SE, 1975; Ln. 1222-SE, 1976; and Ln. 1810-SE, Cr. 993-SE, 1980); a fifth project in the highway subsector was approved by the Executive Directors on March 13, 1984; and two projects in the ports subsector (Ln. 493-SE, 1967 and Ln. 1405-T-SE, 1977). 33. The first two railway projects concentrated on improvements in physical infrastructure, while the third project, almost completed, emphasizes management and organization improvements and maintenance. The most recent railway project supports the transport needs of the Industries Chimiques du S'negal (ICS), a fertilizer complex financed by IFC and other bilateral and multilateral agencies. The aviation projects emphasized expansion and devel- opment of airport infrastructure at Dakar and two domestic airports. While the first road project emphasized feeder road construction, subsequent pro- jects have concentrated on road main-tenance and the development of the Govern- ment institutions in this vital area. 34. The first port project improved the Port of Dakar's infrastructure and operations. The second project, cofinanced with CCCE and BADEA, provided  - 11 - for construction of a fishing wharf and ancillary works. The Project Perform- ance Audit Report of the First Port Project stated that it had been a success- ful investment with a satisfactory rate of return and well-executed engineer- ing works. The facilities of the Fishing Port were completed well within cost and became operational in 1981; they are being efficiently utilized by the fishing sector. The technical assistance components are now being completed and therefore the PCR has not yet been prepared. The Port of Dakar Facilities, Operations and Traffic 35. The Port of Dakar, located on the westernmost tip of West Africa, enjoys an excellent sheltered location free from heavy swells and siltation. Two long breakwaters enclose a large port basin providing a total of 37 gen- eral cargo and five petroleum berths with various alongside drafts in varying maintenance conditions. Most facilities were constructed according to the traditional system of providing narrow finger piers with substantial berthing space for vessels but with very limited operational areas. The recently completed Fishing Port Project provides some 1,500m length of new berth and 10.5 ha of reclaimed land, capable of handling all forecast fishery-related activities. Dakar also has the largest ship repair facilities on the West African coast comprising a 60,000 DWT floating dock, a 25,000 DWT drydock and 1,200 DWT synchrolift. 36. Port operational areas now available for general cargo handling amount to some 16.7 ha, of which 3 ha are reserved for container handling. The container handling areas are, however, dispersed and generally unsuitable for modern operations. Vessels unload and load a large number of containers in a few hours, thus requiring large operational areas and adequate equip- ment. Despite these shortcomings, the Port handled some 59,000 containers in 1983. However, the utilization of the available areas has reached its limit, and any additional container traffic will further decrease the overall effi- ciency of operations, causing congestion on the wharfs and delays to ves- sels. The Port owns limited, but run-down, cargo-handling equipment. Most cargo is handled by the ship itself with its own gear or onshore, with equip- ment belonging to the private stevedoring companies. 57. From the operational point of view, the Port is managed and operated on the traditional French concept whereby the Port Authority, the owners of the Port, operate the Port as a Landlord Port (Port de Service). Private companies perform all cargo handling and stevedoring operations, tugboat services and other traditional port operational activities, using their own equipment. This concept has its merits as it removes from PAD managerial and operational burdens relating to employment of labor, handling of cargo and dealing with vessels, but it does not always ensure efficient use of facili- ties and limited operational areas. Mere addition to operational capacity will not suffice; hence, the proposed project includes technical assistance to the Port management to improve operations, optimize use of existing areas for general cargo handling and improve operating efficiency so that the Port  - 12 - becomes a more active manager of its infrastructure and facilities. An action plan based upon a consultants study was agreed upon during negotiations and would be implemented under the project in accordance with an agreed time- table; under the action plan, the recruitment; of a suitably qualified port operations expert would be a special condition of Credit effectiveness (such an action plan was agreed in accordance with Sections 3.01 (a) of the draft Development Credit Agreement and of the Special Fund Agreement and Article III of the draft Project Agreement; see also Section 5.01 (d) of the draft Devel- opment Credit Agreement). 38. An analysis of port traffic data and foreign trade statistics shows that liquid and dry bulk traffic declined by about 30% over the past decade, caused mainly by the reduction of imports of petroleum products (due to the decrease in bunkering activities) and exports of phosphates. However, general cargo imports have increased steadily since 1975 reaching some 1 .25 million tons in 1982. The composition of general cargo is changing and rapid contain- erization is taking place. Dakar handled 5,800 containers in 1975, 36,000 in 1982 and 39,000 in 1983. In addition, Dakar Port is continuing its tradition- al transit role for Mali and Mauritania, handling some 80,000-100,000 tons and 30,000-40,000 tons per year for each, respectively, during the pas-t five years. 39. Container traffic is expected to grow rapidly in coming years mainly as a result of changes in shipping technologies. These changes stem from economic considerations in a highly competitive market as shipping lines have introduced larger vessels and moved toward increased containeriza-tion. Fur- thermore, in an effort to streamline operations and reduce costs, liner con- ferences serving West African ports are expected to concentrate their route structure on a few major ports, viz., Dakar, Abidjan, Lagos and Douala, where they would provide regular scheduled services and use these ports as main transshipment points. Organization and Staffing 40. The Port Authority of Dakar (Port Autonome de Dakar, PAD) was formed in 1959, and since 1960 has been an "etablissement public a caractere indus- triel et commercial" (EPIC). This arrangement, which permits permanent con- trol by numerous Government agencies with frequently conflicting and overlapp- ing responsibilities and interests, limits the Port's financial autonomy by a priori control of all budget expenditures and -hy the Central Treasury cbtain- ing all revenues. As PAD is one of a few profit-making public enterprises with a large positive cash flow, i-t effectively subsidizes deficits of other public enterprises in the Central Treasury pool but is unable to use its own cash balances in a timely fashion for its own needs. Under the proposed project, major modifications to this restrictive system were agreed with the Government and will be progressively implemented during project execution to enable full financial and managerial autonomy by 1988. In order to achieve such an objective, the Government agreed to review, in consultation with the Association, the suitability and the modalities of transformation of PAD's legal status and to communicate to the Association, prior to June 30, 1986,  - 13 - its conclusions and proposals in this respect (in accordance with Section 3.02 (ii) of the draft Development Credit Agreement and of the draft Special Fund Agreement). 41. PAD's Board of Directors comprises 18 members, of which eight repre- sent the Government, five the Port users, one the Government of Mali, one the National Assembly, one the Chamber of Commerce, and two the Port's person- nel. All executive functions are vested in the General Manager of PAD, who also acts, under the authority of the Minister of Equipment, as coordinator of all activities of various Government departments and agencies in the Port-- health and immigration services, gendarmerie, customs, and railways. These agencies, however, not only act completely independently but interfere at times in the smooth operation of the Port as PAD has very little actual say in their day-to-day activities. 42. PAD has a total of 727 employees engaged mainly in the non-opera- tional service sectors organized into five departments, each reporting direct- ly to the General Manager. This organization is not very satisfactory and, excluding the Director of the Engineering Department, none of the other direc- tors is an active decision-making 'Line manager. In particular, the lack of a financial manager and well-organized financial staff has resulted in non- existent internal controls, poor follow-up of financial matters and confusion in PAD'S financial information flow. The problems of the Port's financial organization have been well studied under a recently completed audit, and its recommendations form the major thrust of the organizational reform to be carried out under the proposed project. Accounting and Finance 43. PAD's accounting system broadly follows the Senegalese Accounting Plan, itself a deviate of the French system. There is as yet no cost account- ing system in place, but consultants financed under the Fishing Port Project are helping PAD set up and implement one. Major weaknesses in PAD's account- ing procedures and practices were revealed by the external audits carried out under the Fishing Port Project. As a result, an action program has been defined and is being implemented to rectify major errors, reorganize account- ing records pertaining to receivables and fixed assets, and introduce proper systems and procedures. Under the proposed project, long term technical assistance will be provided to organize the accounting and financial manage- ment functions. 44. A fixed asset revaluation was carried out by PAD in 1980. However, as a result of the recently completed audit, the validity of the revaluation is in doubt; it had relied on an inaccurate fixed asset inventory and inade- quate procedures. Consequently, it has been agreed that PAD would first rectify and update the fixed asset ledger per the balance sheet of June 30, 1985, before undertaking a new revaluation exercise. Furthermore, it is likely that some existing assets will need to be retired from the fixed asset base, once the proposed container terminal is completed and certain existing facilities are rendered obsolete or are transformed to other non-port uses.  - 14 - Hence, incorporation of new asset values will take some time to achieve. Moreover, as PAD may not be able to legally upvalue its assets under Senegal- ese accounting legislation, it has been agreed that by no later than December 31 , 1985, PAD would present annual pro forma balance sheets incorporating the revalued asset base, to be corrected from time to time for retirement of non- productive assets. Tariffs 45. Port tariffs are set by PAD's Board and approved by the Ministers of Equipment and of Finance. PAD has not experienced any delays in obtaining such approvals, and tariffs have more or less kept pace with inflation in recent years, averaging 10% a year. Under the Fishing Port Project, PAD substantially revised its tariff structure applying to the new facilities. However, a more general revision of port tariffs for a cost-based structure has rnot been carried out pending implementation of a cost accounting system. A comparative study of port tariffs at major West African ports reveals that Dakar is substantially cheaper by some 15-20% on the average in all aspects of port services and operations. 46. The presence of such significant differences suggests undercharging by PAD for its services, due not only to inability to accurately record costs, but to the obsolete nature of the basic tariff structure. PAD's inefficient management of port space also stems from inadequate use of charging policies as a means of achieving improved performance from the private cargo handling operators. Weak and passive port management has sustained inadequate tariff levels and led to non-optional use of port areas. As stated in para. 37, the Port has agreed to implement an action plan to improve its operational and managerial performance. In parallel, PAD hais also agreed to undertake a thorough tariff study both in preparation of appropriate charging policies for the proposed new facilities, and to restructure the tariffs for its existing facilities and services, such restructuring to be carried out not later than July 1, 1987 (Sections 4.03, 4.04 and 4.05 (EL) of the draft Project Agree-- ment). A preliminary restructuring will be carried out on July 1, 1985, when the results of an ongoing review of tariffs will be available. PART IV: THE PROJECT Origin and Background 47. Under the Fishing Port Project (Loan 1405-T-SE, 1977), funds were provided for a feasibility study to assess the need for the Port of Dakar to develop more substantial container handling facilities by the mid-eighties, in light of rapid containerization that was becoming apparent in the late-seven- ties. The consultants Port of Marseille (PAM) carried out the technical and economic feasibility studies. The proposed pro,ject emerged from the review of  - 15 - the consultants' recommendations. Project preparation, preappraisal and appraisal missions were carried oul; by the Bank in 1982 and 1983, with active participation of both CCCE and the Kuwait Fund. 48. The physical dimensions of the project emerged as a result of the feasibility studies, after careful review of alternatives, while an evaluation of PAD's operations left no doubt that PAD's performance could be substantial- ly improved both in managing port operations and in its administration. Negotiations were held in February 1984, in Paris, with a Senegalese delega- tion led by the Minister of Planning. Staff Appraisal Report No. 4625-SE, dated March 29, 1984 is being distributed separately to the Executive Direc- tors. Project Objectives and Description 49. The proposed project would reduce freight costs for Senegal's ex- ternal trade and enhance Dakar's position as a port of transfer for neighbor- ing countries by the provision of additional facilities and rehabilitation of existing ones and by strengthening the Port's management and operations so that it may fully carry out its role as a vital public service in Senegal. To meet these aims, the proposed project would consist of: (i) Civil Works involving: (a) construction of a quay wall in a total length of 430 m suitable to berth simultaneously two large container vessels; (b) dredging of areas alongside the berth and from the Port en- trance to the terminal area; hydraulic sand filling of the area behind the quay wall to reclaim the terminal's container handling area of 8.2 ha; (c) paving of the container handling area, installation of utility services and fuel lines, and connection of the terminal area to the national railway network; and (d) repair and rehabilitation of certain port facilities. (ii) Consulting Services and Technical Assistance (a) consultants' services to supervise the construction of the container terminal and train PAD engineers to work on construc- tion supervision; (b) study of the management of the container terminal; (c) training of PAD personnel in container terminal management and operations;  - 16 - (d) technical assistance, consultant services and training to improve the Port's financial management, carry out account audits, study tariffs and recommend structural changes, and provide data processing support; and (e) technical assistance and training to improve the Port's opera- tional management. Project Implementation 50. PAD will be responsible for project execution with the assistance of qualified consultants to be employed on terms and conditions to be acceptable to the Association and co-lenders. Civil works are expected to take about 27 months to complete, starting in October 1984. Some activities of the techni- cal assistance program will continue into FY87/88. An action plan to improve the Port's operations and management, based upon a consultants' study, was prepared and agreed upon during negotiations, and its implementation will start following review by the other co-lenders. The Port also requested consultants' proposals for technical assistance in accounting and financial management, and recruitment of experts is expected to be carried out by July 1984. Funds available under the ongoing Fishinag Port Project (Loan 1405-T-SE) would finance a part of the above two items until funds to be provided under the proposed Credit and from the other co-lenders are effectively available. PAD's Engineering Department will prepare and advertise the bids and supervise the works to be completed under the deferred maintenance program component, which will start in early FY85. Project Cost and Financing 51. The estimated cost of the project, net of taxes and financial costs, is US$19.63 million equivalent (including physical and price contingencies) with a foreign exchange component of US$15.36 million equivalent. The project will not be exempted from taxes and duties, which amount to some US$5.55 million equivalent. Interest during construction would amount to about US$2.37 million equivalent. Thus, the total cost, including taxes and in- terest during construction, would equal US$27.55 million. The cost estimates for the civil works Lots #1 and 2, comprising construction of the quay wall and dredging and reclamation works, are based Dn actual bid prices received in December 1983--which are valid without escalation until April 1984--and the bid evaluation carried out by PAD. The cost estimates for the remaining civil works prepared by consultants and PAD are baEed on final engineering designs and on costs of recent similar works, including the Fishing Port Project completed in 1980/81 and updated to early 1984 cost levels; they compare favorably with international bids received recently for similar port works on the West African Coast. The project also includes provision for consultants and advisory services totalling some 206 man-months. Physical contingencies assumed vary between 10%-20% depending upon the type of work. Price contin- gencies have been calculated for local costs at 10% a year and foreign costs at 7.5% for 1984, 7.0% for 1985, and 6% a year thereafter.  - 17 - 52. Of the total project cost (net of taxes), the proposed Kuwait Fund loan would finance the equivalent of about US$4.1 million or 21%, the CCCE loan US$6.7 or 34%, and the IDA and Special Fund Credits US$2.65 million and US$4.85 million or 13% and 25%, respectively. PAD would contribute about US$9.3 million equivalent from internal cash generation. PAD's contribution would cover all taxes and duties on the project, the interest during construc- tion and 7% of the net-of-tax project cost. Any potential cost overruns or exchange rate losses would also be covered by PAD, as there is at all times sufficient cash flow from operations. The proposed IDA and Special Fund Credits would be made on standard terms to the Government who would onlend the proceeds to PAD on standard Bank terms, under a Subsidiary Loan Agreement, the execution of which would be a special condition of effectiveness (Section 5.01 (a) of the draft Development Credit Agreement). The onlent funds would be repayable by PAD in equal semi-annual installments over 20 years including a four-year grace period. The proposed CCCE loan of FF 52 million would be a blend of soft and hard terms, bearing approximately a 7% interest rate, and would be repayable in equal semi-annual amortizations over 17 years including four years' grace. The proposed KF Loan of KDinars 1.25 million would be made to the Government at a 4% interest rate, repayable over 20 years including five years' grace. It would be onlent to PAD on the same terms. 1/ The Government would impose a 1% guarantee fee on the CCCE loan. Procurement and Disbursement 53. The construction of quay walls would be procured under competitive bidding which was limited to the Franc Zone and would be financed by the CCCE and PAD. Procurement of Lot #2, dredging/fill, following Bank Group guide- lines for international competitive bidding, would be financed jointly by the Kuwait Fund and IDA. The KF earlier agreed to the list of prequalified bid- ders. Lot #3 (US$4.93 million), utilities, would be financed by proceeds from the Special Fund Credit, and procurement would be limited to goods produced in, or services from, any of the following countries: (a) any Part II member of the Association and (b) those countries who at the time of signing the Credit Agreement have notified or advised the Administrator in writing that they intend to make a Special Fund Contribution in a minimum amount conforming with paragraph 4 of the Special Fund Resolution, or (c) which had notified or advised the Association in writing that they intend to make a Special Contri- bution in such a minimum amount to the FY84 Account and had advised the Asso- ciation in writing that such Special Contribution was to be treated in the same manner as a Special Fund Contribution for purposes of any future adjust- ment of the voting rights of the members of the Association. The deferred maintenance work would be financed by PAD and the Association and would follow local procurement procedures acceptable to the Association. The training 1/ The KF has already agreed to a loan of KDinars 2.1 million based on the financing plan at appraisal. As a result of lower-than-forecast bid prices, the new financing plan is substantially lower and any excess amounts would be cancelled at the end of the project.  - 18 - programs would be funded entirely by the CCCE. The other project items-- consultant services and technical assistance contracts--would be procured following Bank Group guidelines for employment of consultants, and funded jointly by PAD, the Kuwait Fund, and the Association. Project supervision would be carried out by PAM and funded jointly by IDA, CCCE and PAD. Consul- tant services for the Action Plan would be funded jointly by KF, CCCE and IDA. The data processing component would be funded entirely by the Associa- tion. All contracts would be financed by -the co-lenders on a net of tax basis, and the relevant taxes and duties will be separately invoiced, accoun- ted arnd paid by PAD. 54. The IDA Credit, covering 13.1% of the estimated total project cost, would be disbursed over a five-year period, FY885-89. It would cover specif- icall;y the following expenditures: 35% of the total cost of Civil Works Lot #2 (dredging and fill); 48% of the cost of the Project supervision contract; 23% of the total cost of Consultant Services for tariff and container terminal management studies, audit, and financial management; 100% of the data proces- sing component; 17% of the cost of consultant services for Action Plan imple- mentation; and 35% of the total cos-t of deferred maintenance works carried out after signature of the Credit Agreement. The! Special Fund Credit, covering 25% of the estimated total project cost, would finance 98% of the total cost of Lot #3 (paving and utilities). It would be disbursed over a three year period from FY86-88. Environmental Impact 55. No adverse ecological impact is expected to occur with the construc- tion of the proposed container port, nor disturbance to marineX ecology in the vicinity of the existing port. Economic Evaluation 56. The proposed project would enable PAD to handle the growing number of containers (estimated at 115,000 by 1995) efficiently and at a reasonable cost. The proposed new container terminal would allow container ships using it and general cargo ships using the existing port to be serviced much more expediently and cargo to be handled more efficiently, eliminate the need for double handling of containers, and would alleviate congestion at existing berth-side and storage areas. The consultants analyzed three basic alterna- tives for a container terminal. The proposed projet is the Phase I develop- ment of the recommended alternative and comprises the construction of 430 meters of quay and 82,000 m2 of container handling and storage areas. The terminal's Phase II development, to be built at a later stage, foresees the extension of the quay to 725 m and increasing the operational areas to 175,000 m2. The terminal, when fully developed, would allow adequate coverage of berth and storage needs beyond the year 2000, would have good road and rail transport access, and its construction would only minimally disrupt ongoing port operations. Without the project, container handling would be increasing- ly slowed and expensive at ill-adapted facilities, adding unnecessary costs to  - 19 - Senegal's international trade. The project would also reinforce the role of Dakar as a transit port for Mali and Mauritania and for transshipment to and from other West African ports. 57. The institutional components of the project are expected to improve productivity, efficiency of port operations in general and cargo and container handling in particular, improve the level of management and its information system and increase the Port's financial autonomy. 58. The economic rate of return of the terminal is estimated at 23%. A sensitivity analysis, including increases in costs and shortfall as well as lag in benefits, showed satisfactory results even under pessimistic assump- tions: if all benefits were to lag by two years, the return would be 18%, and if investment costs were 20% higher and all benefits 20% lower, the return would be 17%. No rate of return has been calculated for the maintenance components, but such works generally have extremely high returns. Financial Evaluation 59. PAD's long-term financial objective is to be a fully autonomous, commercially oriented public enterprise. In recent years, however, the Gov- ernment has exercised an over-zealous control over PAD and has not permitted PAD to achieve the autonomy foreseen in its statutes. This situation would change under the proposed project. As a first step, the Government agreed to permit a portion of PAD's revenues (15% in FY84, 30% in FY85, rising to 40% in FY86 and beyond) to be isolated from the currency pool in a Special Account held with the Treasury, and then to be transferred to an external bank account held with a commercial bank; this move would permit PAD to ensure that its cash contribution to the project financing plan is clearly set aside without fear of delays in paying contractors, as does occur now under the currency pooling arrangement (Section 4.08 of the draft Project Agreement). It would also permit PAD to finance its annual renewal programs without the delays it currently experiences. The Government agreed that PAD would not be exempt from taxes and duties on the project. As a step towards ultimate financial autonomy, PAD has already been permitted to raise the ceiling on its revolving fund for current expenditures substantially so that PAD's budgeted maintenance works and other recurrent expenditures can be carried out more independently of the normal channels of Government payment procedures. The Government and PAD also agreed to present for Association review and comment no later than June 30, 1986, a plan, including proposals for any legislative/statutory changes needed, to achieve the basic objective of financial and managerial autonomy free of counterproductive constraints imposed by the present system (para. 40 above). In addition, as a special condition of Credit effective- ness, the Government and PAD should agree to a plan and timetable for clearing of arrears on payments of mutual debts (payments for services performed by PAD for the Government and/or its agencies, and tax and interest payments due from PAD) and to a mechanism to ensure regular payments by the Government for PAD services (Section 5.01 (b) of the draft Development Credit Agreement).  - 20 - 60. The translation of full cost recovery into action would require changes both in PAD's tariff structure and levels. A revised tariff structure based on an ongoing review of PAD tariffs would be put into operation by July 1, 1984. However, incorporation of a revalued asset base in the tariff set- ting formulae would be feasible only by July 1, 1986, i.e., after completion of a revaluation exercise in FY85. However, the levels, and possibly struc- ture, would need further adjustment once the new container terminal is com- pleted and once proposals have been made for re-use and/or temporary closure of certain facilities that would no longer be needed, at least for the next several years. As this second phase of tariff changes cannot occur before FY88 (i.e., when the container terminal project; is completed), it was agreed that a rate of return covenant would only be set as a long-term target. A target of 6% return on revalued net fixed assets, in use appears appropriate and satisfactory to cover PAD's future financial needs (Section 4.04 of the draft Project Agreement). However, it was agreed that no later than June 30, 1987, this proposed target would be reviewed and adjusted as deemed neces- sary. In the meantime, the main operative financial covenant would be a cash flow target. This target would ensure that each year, PAD's net; internal cash generation after debt service would cover at least 40% of total capital in- vestment expenditures averaged over a three-year period (prior, current and following years). Such a criterion would permit PAD to fuLly finance its annual renewals and other investments, allow for necessary working capital increases, and contribute 33% to the project financing plan, including taxes and duties and interest during construction (Section 4.03 of the draft Project Agreement). PAD's financial performance would be reviewed annually at least 90 days prior to the close of its fiscal year, so that any corrective action, including tariff increases if needed, may be taken (Section 4.05 of the draft Project Agreement). 61. PAD's projected financial performance in line with the above short- term and long-term targets shows that, in addition to the recently enacted tariff increase averaging 12.7% for FY84, PAD would need to increase its total revenues by about 10% at the start of FY85 in order to meet the target cash flow requirements. As this tariff increase is critical to satisfactory pro- ject execution, its enactment is a special condition of effectiveness (Section 5.01 (c) of the draft Development Credit Agreement). Beyond FY85, revenue increases averaging about 10% in FY86 and in FY87 would be needed to ensure a satisfactory flow of funds to the project. These increases could partly come through the restructuring of tariffs (para. 46), partly through tariff increa- ses to keep pace with inflation, and partly through cost reductions, as pro- ductivity improves. 62. PAD would pay the taxes and duties on the project (estimated at CFAF 2,176 million equivalent) under a flexible arrangement which would permit PAD to schedule the payments up to June 30, 1989, should cash flow be lower than forecast. PAD would set up and maintain separate tax liability accounts that would be eventually cleared against payments out of the Special Account (para. 59). A Government/PAD agreement spells out the mechanism in detail and pro- vides PAD the flexibility to defer payments up to a maximum of two years but not beyond June 30, 1989.  - 21 - 63. PAD's projected financial position remains satisfactory with a maximum debt/equity ratio of 46/54 and with adequate current ratios exceeding 2.0 in each of the intervening years through to project completion. Debt service coverage is adequate. However, in order to ensure that PAD's capital structure and debt service burden are not strained further until the container terminal is in full operation, a debt limitation covenant has been agreed (Section 4.07 of the draft Project Agreement). It provides for prior consul- tation with the Association before incurrence of any additional debt that would tend to lower overall debt service coverage of the maximum debt service burden below 2.0. Risks 64. No economic risks of significance are associated with the project since there has been a good base for estimation of construction costs and adequate safeguards have been taken to ensure that the new terminal would be efficiently operated and that expected benefits would materialize. The main risk is institutional in nature. If PAD's internal structure does not develop as envisaged and its financial management does not improve to the extent forecast, one result would be inefficient use of a heavy investment by Senegal in a container port facility and possible loss of tax revenues to the Govern- ment, due to PAD's inability to generate the level of revenues for which it would have been equipped. A sensitivity analysis of financial factors was carried out to determine the robustness of PAD's finances under adverse oper- ating conditions. The base analysis was carried out on a fairly conservative traffic forecast; nevertheless, an even lower rate of overall traffic growth (2.5% a year versus 3.5% a year under the base forecast) compounded by higher rate of inflation of working expenses (12.5% a year against 10% in the base case) was analyzed. The results demonstrate that even in the worst scenario, PAD would still be able to fully cover its financial contribution to the project out of its own earnings and would be able to pay the taxes due on the project investment no later than June 30, 1989. Marginal additional tariff increases, however, would be needed to achieve the financial targets. The sensitivity analysis also shows that the projected tariff/revenue increases are critical to achieve the financial targets. Nevertheless, even if such increases are limited, PAD's financial position remains acceptable, although continued delays in appropriate tariff setting could jeopardize PAD's financi- al prospects. The agreement to hold annual consultations would, however, ensure that corrective action is taken well before serious deterioration of PAD's finances occurs. PART V - LEGAL INSTRUMENTS AND AUTHORITY 65. The draft Development Credit Agreement and Special Fund Agreement between the Republic of Senegal and the Association, the draft Project Agree- ment between the Port Autonome de Dakar and the Association, and the Recommen- dation of the Committee provided for in Article V, Section 1 (d) of the  - 22 - Articles of Agreement of the Association, are being distributed to the Executive Directors separately. 66. The following are additional conditions of effectiveness of the Credits, namely: (a) execution of a Subsidiary Loan Agreement between the Republic of Senegal and the Port Autonome de Dakar (Section 5.01 (a) of the draft Development Credit Agreement); (b) execution of an Agreement between the Republic of Senegal and the Port Autonome de Dakar providing for the full settlement by June 30, 1987, of existing reciprocal debts as of December 31, 1983, and for all necessary arrangements to ensure prompt settlement of such debts arising between January 1 , 1984 and June 30, 1985 (Section 5.01 (b) of the draft Development Credit Agreement); (c) effecting of a tariff increase as of July 1 , 1984, of at least 10% on all PAD services (Section 5.01 (c) of the draft Development Credit Agreement); and (d) appointment of a suitably qualified port operations expert (Section 5.01 (d) of the draft Development Credit Agreement). 67. Special conditions of the Development Credit and Special Fund Credit are listed in Section III of Annex III. 71. I am satisfied that the proposed Development Credit and Special Fund Credit would comply with the Articles of Agreement of the Association. PART VI - RECOMMENDATION 69. I recommend that the Executive Directors approve the proposed Devel- opment Credit, and Special Fund Credit. A. W. Clausen. President Washington, D. C. March 29, 1984 Attachments  - 23 - ANNEX I T A B L F 3A PAGE I SENEGAL - SOCIAL. INDICATORS DATA SHEET SENECAL REFERENCE GROUPS (WEIGHTED AVERAGES) /a MOST (MOST RECENT ESTIMATE) /b __b /b RECENT MIDDLE INCOME MIDDLE INCCME 1960/ 1970- ESTIMAT/- AFRICA S. OF SAHARA N. AFRICA & MID EAST AREA (TROUSAND SQ. KM) TOTAL 196.2 196.2 196.2 AGRICULTURAL 99.2 104.5 1D9.3 SNP PER CAPITA (US$) 180.0 240.0 430.0 1147.9 1340.0 ENERGY CONSUMPT ION PER CAPITA (KILOGRAMS OF COAL EQUIVALENT) 555.0 519.0 364.0 724.2 810.4 POPULATION AND VITAL STATISTICS POPULATIOON,MID-YEAR (THOUSANDS) 3498.0 4391.0 5862.0 URBAN POPULATION (T OF TOTAL) 23.0 30.0 33.8 28.5 47.4 POPULATION PROJECTIONS POPULATION IN YEAR 2000 (MILL) 10.2 STATIONARY POPULATION (MULL) 36.4 YEAR STATIONARY POP. REACHED 2155 POPULATION DENSITY PER SQ. RM. 17.8 22.4 29.1 56.5 36.0 PER SQ. KM. AGRI. LAND 35.3 42.0 52.2 131.8 449.0 POPULATION AGE STRUCTI[RE (1) 0-14 YRV 42.7 43.9 44.8 45.9 43.9 S-64 YRS 54.3 53.2 52.4 51.2 52.8 65 AND A30VE 3.0 2.9 2.8 2.8 3.3 POPULATION GROWTH RATE %l) TOTAL 2.4 2.3 2.6 2.8 2.9 URBAN 3.0 4.9 3.7 5.3 4.6 CRUDE BIRTH RATE (PER THOUS) 47.9 46.8 47.9 47.6 42.5 CRUDE DEATH RATE (PER THOUS) 26.5 23.2 21.0 15.2 12.0 GROSS REPRODUCTION RATE 3.2 3.2 3.2 3.2 3.0 FAMILY PLANNING ACCEPTORS, ANNUAL (THOUS) USERS (; OF MARRIED WOMEN) .. .. .. FOOD AND NUTRITION INDEX OF FDOD PROD. PER CAPITA (1969-71=100) 125.0 83.0 90.0 95.7 97.5 PER CAPITA SUPPLY OF CALORIES (1 OF REQUIREMENTS) 97.0 96.0 100.0 97.1 102.3 PROTEINS (GRAMS PER DAY) 65.0 64.0 71.0 56.0 72.0 OF WHICi ANIMAL AND PLLSE 20.0 20.0 19.0/c 17.2 17.8 CHILD (AGES 1-4) DEATH RATE 41.9 36.8 31.1 23.6 15.2 HEALTH LIFE EXPECT. AT BIRTH (YEARS) 37.2 40.3 43.9 51.9 57.2 INFANT MORT. RATE (PER THOUS) 181.7 164.4 144.6 117.6 104.2 ACCESS TO SAFE WATER (%POP) TOTAL .. .. 37.0/d 25.4 59.3 URBAN .. .. 68.07d 70.5 84.9 RURAL .. .. 23.07; 12.3 37.5 ACCESS TO EXCRETA DISPOSAL (% OF POPULATION) TOTAL .. .. URBAN .. .. .. RURAL .. .. .. POPULATION PER PHYSICIAN 24990.0 16700.0 13800.0/e 12181.6 3536.0 POP. PER NURSING PERSON 2840.0/ 3 1940.0 1400.0/c 2292.0 1820.7 POP. PER HOSPITAL BED TOTAL 840.0 810.0 900.0/c 1075.4 643.3 URBAN 390.0/f 450.0 560.0/c 402.3 545.0 RURAL 1810.0o7 1240.0 1280.07W 3926.7 2462.0 ADMISSIONS PER HOSPITAL BED .. 22.2 29.2/c .. 26.4 HOUSING AVERAGE SIZE OF HOUSEHOLD TOTAL .. .. URBAN .. 7.6/h .. . RURAL .. 6.0/h AVERAGE NO. OF PERSONS/ROOm TOTAL 1. 5/i .. URBAN .. .. RURAL .. .. .. . ACCESS TO ELECT. (T OF DWELLINGS) TOTAL .. .. .. .. 46.2 URBAN .. .. .. .. 77.6 RURAI, .. .. .. .. 16.1 _- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ -_ _ -_ _ -_ _ -_ _ _ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ - -_ -  -24 - ANNEX I T A B L E 3A PAGE 2 SENEGAL - SOCIAL INDICATORS DATA SHEET SENEGAL REFERENCE GROUPS (WEIGHTED AVERAGES) /s MOST (MOST RECENT ESTIMATE) /b RECENT lb MIDDLE INCOM4E MIDDLE INCOME 1960/ 1970- ESTIMATE- AFRICA S. OF SAHARA N. AFRICA & MID EAST EDUCATION ADJUSTED ENROLLMENT RATIOS PRIMARY: TOTAL 27.U 38.0 44.0 97.2 89.6 MALE 36.0 47.0 53.0 103.1 104.8 FEMALE 17.0 30.0 35.0 88.5 72.4 SUCONDARY: TOTAL 3.0 9.0 10.0 17.2 41.7 MiALE 4.0 13.0 14.0 23.5 52.o FEMALE 2.0 5.0 7.0 14.2 31.2 VOCATIONAL (X OF SECONDARY) 23.1 9.2 8.8 5.2 10.3 PUPIL-TEACHER RATIO PRIMARY 43.0/f 45.0 43.0 42.9 31.9 SECONDARY 34.0 34.0 21.0/c 23.7 23.3 ADULT LITERACY RATE (X) 5.6/j 10.0 10.0/c 37.1 43.3 CONSUMPTION PASSENGER CARS/THOUSAND POP 5.7 8.7 9.2/k 18.8 18.0 RADIO RECEIVERS/THOUSAND POP 35.7 61.0 52.6 97.8 138.1 TV RECEIVERS/THOUSAND POP .. 0.3 0.7/d 18.6 45.6 NEWSPAPER ('DAILY GENERAL INTEREST") CIRCULATION PEE THOUSAND POPULATION 5.7 4.6 4.5 18.2 31.0 CINEMA ANNUAL ATTENDANCE/CAPITA .. .. 0.7 0.6 1.7 LABOR FORCE fOTAL LABOR FORCE (rIOUS) 1598.0 1931.0 2468.0 FEMALE (PERCENT) 40. 40.2 39.8 36.1 10.7 AGRICULTURE (PERCENT) 84.0 80.9 76.9 56.8 42.5 INDUSTRY (PERCENT) 5.0 7.0 10.0 17.5 27.8 PARTICIPArIIN RATE (PERCENT) IOTAL 45.7 44.0 43.3 37.0 25.6 MAL. 54.4 53.1 52.6 47.1 45.4 FEMALE 37.1 35.0 34.1 27.0 5.6 ECONOMtIC DEPENDENCY RATIO 1.U 1.1 1.1 1.3 1.8 INCOME DISTRIBUTION PERCENr OF PRIVATE INCOME RECEIVED BY HIGiEST 5X OF iOUSEHOLDS 36.8/1 .. riIGHEST 20% OF HOUSEiOLDS 62.5/1 LOWEST 20% OF HOUSEHOLDS 3.2/1 LOWEST 40X OF HOUSEHOLDS 9.47 POVERTY TARGET GROUPS ESTIMATED ABSOLUTE PUVERTY INCOIME LEVEL (US$ PEE CAPITA) URBAN .. .. .. 534.2 276.1 RURAL .. .. B2.0/e 255.9 177.1 ESTIMATED RELATIVE POVERTY INCOME LEVEL (USS PER CAPITA) URBAN .. .. 194.0/e 491.5 400.0 RURAL .. .. .. 186.1 283.3 ESTIMATEiD POP. BELOW ABSOLUTE POVERTY INCOiE LEVEL (X) URBAN .. .. .. .. 22.0 RURYAL .. .. .. .. 3U.o ..aOT AVAILABLE NOT APPLICABLE N OT E S /a The group averages for each indicator are population-weighted arithmetic means. Coverage of countries among the indicators depends on availability of data and is not uniform. lb Unless otherwise noted, "Data for 1960" refer to asy year between 1959 and 1961; "Data for 1970" between 1969 and 1971; and data for "Most Recent Estimate' between 1979 and 1931. Ic 1977; /d 1976; /e 1978; /f 1962; /g 1963; /h 1973; /i 1955; /j African population only; /k 1974; /1 Population. May 1983  ANNEX I - 25-3 TOT FIMTOIi OF SOCIAL iOOlOaOon aenstin 50000 r cim odo nr Icnot toos .and tioacttioncoraloeas Oft~ "r ,In-n hrto Iccn .r.5 - morbadt o-_bt_ issr fsr5 aoaeA it- tins a-se ie bodletor de-rte atoronr Latobo tAo no. n tsf ,n-ff ,rto aeh aRI thoado.ahssstosn 5 n. soeolci-ib nnco peon ic-c 1Tssod 8P ant, Pslotcore Nartloc _r ea- TnOnnt- jit-de-Scosr01pofs NIl and INf Iota. Ppirinethaital On - roe-o, -b-dp -dys-ol-t'oitinIro _ro, trh Issiod by oPsIr nJ, n~ oa Orr oe ,,o sds TSP lid 1001rA IPI) - - lO o 000 s'tsssF sosr- oI= rIesettoo is I polls- ah rct rns s poor -i b-sn -a ad faS, APP7, Ona IN As at ln r Oysra e-lI iaonncidig poI I a O ato s SMIf CONSUI(MON F~ ~ ~ ~ ~ ~ ~~~~~~~~nssne nt csafd.las)bopiel, nlos, n-si rsIt n IN6T. NIP, and 1i8P oats-oho tsyel nni550clcnlarrlboel,odc i in5a. loss ras~~~~~~~~~~~~~~~ipist,5 ilnldod by sb nn)sttOrn llros npf oianiPrrss o eal -tell ra ssboo enIt,tlpy.I'll, dLtfsts eif oo r tr rsare Ie- snaotaltly of seljAsiNS so-tI ocls NO Nl n 05 sa gjyn-n -rttpaOooii-ofgP-,a so Posnlnsssn Oon)atisso S~~~~ 11111~11 111i d OfnfIf itg-sro d-sioo.-AtI h-rfsoqnbs pess.Pt paansst ir s-llilty -nsa also hsslnlseeasofciprs Neetoso asslanls- lo a - saLoIr popfos-- s-en f-n gro roslscs n.tOol he sctselslb oP- nrsIs sitadosogorenoOso dal r a asceaoesrlosotslressrnssosro,sa- ronayrnrnnofaanross-rseooe saradrrl gsosotii nnsano rOlots farloesaef5.Onesis Ossrn rsf rsn al kranS hc ftean lon o oo-snsgssoP rnpeelo rssfatnslssaeo si-innoh hss a n pn;ssd hoarer potn- nbs- fo0sletin nr all ns".l ons -n5 lro sps -l Idlso oeynasfa arsot-Ic saos -t riel-.n o r--tad1-a nsderonLioOD e Klrst --ss o rsrteitr Vta e atylcsrs- ieat. cn it-sa at, 5555al nosalss nn-al-nes ns -Ln in rssc 555 onsbssrsnyooetto s oaosod- b Str aee5stalnaryslonne -nf aasnh-Is r bts he...oralos'ofOre tossnr.tesft O tso soOrn 5 o oryar5O ppnr-rsarpts-oOtn oo.lp;, Ini- Ao- an--0N naa Osalotnollotyrn lnIasn aaloa oto P-ooslaslns hi icser orst -Iiin -iaSao shn-t i- ollssobl tAa - nt 0 Ir p -opo -sn-s ..r.s isProd- p lio iSI'f, i acT, ner r ng 70 - Iota. snnpl-l-tehcnisotnyadsonots-Ooison srlldo I~jslniss Onstt oes lso-esl - ensal- Osslaoe otsn ola -claoa aop0 onsdot. cns. lrd _ ab rr la onotot -d hi-n rosP nsn nod-ertnsgsas-trosssdpolsoioeesn n pspioioo;fnl,IPO.ns ioi Oos --,,,sosnp ons-he sghtrfcoo sand-s sho\a t,Sessonso nnn on Ksto sas-nnnf na-ore ..dogotsa..a sl to.s U scysndl 11bes "asI rernoslsprs0Iet nytnns saosnsathoi ndsOclss sso.tniopltis dgiprarnes'ntrai ss-grnn. 00 hsnofnarasi',E-iy - LeLb --btnaznlnln -01 rs os ob sn a)0 onart Onnr n 5.55 Ann trst. O-.tyoppr-trnl-ndta yffl lnna i-j4oa - hfO ro ..ss am ts- -d Toll en Ot s---rsttnoieY-n.r- 0 a - niOn sAt nnlsaatag rrnioenernfi--lradP On bps 0 0501~~~~aa , 60 Prplsos otn rso prsc n o~insns -Isyrd ro hTlIs -sans-Its-ottol -,bs-srlso asIs.-ernnItonlaeo ao tssgrinoabes d Io on oplr-aaoal -ssntr per noiac osssaaabnrnhsocolgInnato odonnes.ssrn day. honfisols ooiplIea nssprtn dnssstl p5sdoonn. fs)nnroe '55 5opointocs o li nfss. eoebnviann In sopsoa-nnnrP Oa gre 0 d essorot, sri nnnessnaotoaob. list nypslns noolods nfoal toad, sneda anparoIte-NoP, 105 no-s 1P5 doss naaoiliio ansi o food rarseelg, coOIassos I iftcb P ., t-sbtnraoP ai ao ansa erne--Oma oo oe teonirrnoroesrsetneoa -dbsralhso dss Iy-alnn:elssdntnPaoI _&slotOoorr-anrs--oaobgfsr y.osio_ anlsspnssnsonadrirottrr- soi- epraaJebi_etcteOtolp- prssoo--bsaoanratsop-lrl-odNtd-s a5sosl ssdleo Hth an II'pnnlss. If osdaibolsrerOrs- ddbr i eeU-lnntno nso. osiri,asbroo si ooebod nos; OuNI,lNn nd hO ot. nastore-n,lasr ndinnasPr250 .a.rss .sn ts... ihi Pee apeoa arrlsof rrisln trers Lor lay) - rtlssnsstratnOPalnO ns ne aloy r ta pnsda. seaplpofesais drenosa sears asnpoh- asIsssnI- oa,sn,oasns-rrbtaln Iof aeeePr Ofnm fsstn ISao hOproi s fbs-n-alpossnr9nyno Anto esesn'na-lbr0pba * Psr sasise peseeto sopolc tenn and) olrPnet npp Os rhcoano Pat-rn --kd) R- -dh oeie rt nsi n, pntni aIsyslp' niSo INT d-sat. 2ml) -1 --t _santa'.is a deo_sel i- n 1- lfls sabes blr ill1 oti li. dot. cne-i _tOnrsa-or tios I s-rs - leA-Ps n-ethr af y-os sO lOt, eaenoIT-d-teO0 atas t' oyopnsos ssono oes fe-el, sni at sboth; 1960, JP9 an iNtO sa-- .h......reoosstaslsaneaos peat, of anspeP tins-ni lire. tI'rePe; INoC IN I so [Nil data. slesoa anoy_nos fsl sasbin enb enoslo aost _ien Oisis djoersd I__nes It npplot -1- -oa ,1 o-lasad co-ni ootet ~Isis) i pd --ros dIs Iftesrn Ia sn-rod sol nar- n- o Nooses s ressltltsiai, shos, si sIsl-tsit-nssaf ares tosJ atna.-I. erea so pry tnollat te-s's n_t _ oosooronco. o batd Oslois Pbt Ilnl P-oosms tirhss -fto) ItIr yes oblo -sro oi-oa aaeoreorhatsr-ss.bd . boss psto-id -ao -ns,sslh ,f asd sar_af rotspoee ro reln ------------o-a--r---------s s'sheseasbasnothoid A.ssssss, snpossonoesae psait Ifocr. Soes a rss ros bn,nn I eso sOrntao l- sss a-ban, and raes-hsnsr O pesIaIrstl. n-ia, tl noafonsna..byenrs dlesea onpsnanafs o~soat ee ertro soalsiso. rorsadlapa-ot sossnood ti rslarts o b Iinss l , U tsr slhs rooaO,o r-'snOsilhm Ios  SENEGAL-ECONOMIC INDICATORS