Mexico - Second Decentralization and Regional Development Project

* - / A 3 7 50 - 4 I)muit of The World Bank FOR OMCXaAL USE ONLY IqitNo. P-6360-M MEMORANMl MAD RECAEDTIO OF TUE PREDENT OF MHE INTERNATION4L BANK FOR RECONSTRUCTION ANDEV TO THE EXECUTIME DIRECTORS ON A PROPOSED LOAN in AN AmO EQUI T To US$500 MIllON TO, NACIONAL FINANCIERA S.N.C. wiTH THE GURNTEE OF THE UNITD MEICAN STATES FOR A SECOD DECEALZATIO AD REGIONAL DEVE PROJECT AUGST 19, 1994 MICROGRAPHICS Report No: P- 6368 ME Type: MOP This docment has a resticted dirntio and may be and by repies only ID tbe p.fonmac of dheir official dutes. Its contet may not odtrwie be disclosed wtout Wod BDnk aoduzaow  CURRENCY EQU1VA,EN'13 Currency Unit k Mexican Newv eso (N$) US$1 -N$3.37 US$296,735 = N$1 million (June 1994) I FISCAL YEAR Januarmy - December 31 WEIGHIS AND MEASURES 1 meter (m) = 3.28 fiet (ft) 1 kilometer (km) = 0.62 mile (mi) 1 hecta (ha) = 10,00 m2 = 2.47 acres 1 square kilometer (cm) = 0.38 square miles (mi?) = 100 ha 1 metric ton (m ton) 2,205 pounds ABBREVUTIONS AND ACRONYMS COPLADE State Plaing Committee (Comit para la Planeacidn dl Desarmollo) DRD Decentation and Regional Development Project ftyeeo de Desemalizaddn y Desarrollo Regional) fm Intr-stast Techncal Groups NAFIN National Finace Institution (Nacdonal Financim, S.N.C) PCU Project Coordinting Unit PCR Project Corpletion Report PROCAMPO Tnade Liberalization and Direct Producer Income Support Proram SEDESOL Secretariat of Social Development (S"eauaa de DesarroUo Soa)  FOR OFFICAL USE ONLY MEXICO SECOND DECENTRALIZATON AND REGIONAL DEVELOPMENT PtOJECr LOAN AND PROJECr SUARY, BorrwLer: Naciond Financiera S.N.C. (NAFIN) Guarantor: United Mexican States Ectig Agency: Sei* de Desarmllo Soci (SEiESOL); Municipalities; Water Suppl% Rura Roads and Agriculture Agencies of the ei saes of Chiapas, Guierrero, Hidalgo, Michoacan, Oaxaca, Puebla, Vacuz, and Zacatecas. Beneficiaries: Poor communities of the eight project sates, including a tota poplation of 25.9 million and a primary taiet of 14.4 million rura population. Loan Amount: US$500 million equivalent. Tms: Repayment in 15 years, including a five-yea grace period, at the sandard variable interest rate. FRnandug Plan: LQaI Freign 3k1 =U-S$millions- IBRD 246 254 500 Federal and State Governments 443 0 443. Beneficiaries 152 0 152 Total 841 254 1095 Economic Rate of Return: Not applicable. bvwerty Category: PA - pvrty Alleviation; Program of Mbgeted Interventions. Staff Appraal Report: Report No. 13032-ME, dated August 19, 1994 Map: IBRD No. 25680. Tl ds _t Noas fauc ftUA amd uy to MOe by recipie oob ill ft pe_ea ftbeir loffaldu&es. Ilscmoonts ao0badisclo&owd %fth '%rd s id =o  MEMORANDUM AND RECOMhMENDATION OF TH1 PRESIDENr OF THE IlRD TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO: NACIONAL FINANCIERA, SN.C WrT THE GUARANTEE OF E NT MEXICAN STATES FOR A SECOND DECENTRAIZATION AND REGIONAL DEVELOPMT- PROJECT 1. I submit f your the following memoraudum and daon on a pr-os loan to Naonal Financiera, S.N.C (NAFIN) for US$500 million equalent with the guae of the United Meaxica States.to help finance a Second Decentalization and Regiona Developmen-t project. The proposed loan wdd be repable at the Bants standard variable rate with a maturity of 15 years, inluding five years of gVae Te project wwld be imnlemented by the federa Secwf(a de Desarrollo Soial (SEDESOL), with the participition of the state and municipal governments of the eight project states. 2. Background. Ibvr remains a major problem in Mexico, even as its ecomy continues to recover ofolowing the macroeconomic crisis of the 1980s. It is esdmated that in 1992, 16 percent of the nadona population of 84 million were ling in conditions of extreme poverty, with over half of the extreme poor living in rural areas. Pverty is concentrated in the southern statec: of the eight project saes, all but one (Zacateca) are located in the southern half of Mexico. Although these states represent only 32 percent of the national population, they contain 69 percent of the extreme poor2 and 54 percent of the population without access to water. These eight states also contain 68 percent of Mexico's indigenous population, who mainly live in rural areas and make up a significant proportion of the rural poor. 3. Rural poyq bas been aggraated by the low leve! of growth and productivity in the agriculture sector. Agriculture GDP growth has been very uneven, averagw -0.3 prce since 1985, while the productivity of agricultural labor has also remained poor, improving only marginaily during the last three decades In recent years, agricultural profitability has declined with the removal of many input and output subsidies combined with the low level of world prices fDr many crops. The new program of direct income payments to producers (the PROCAMPO program) which will accompany the phased elimination of the guarteed price supports for basic grains is expected to provide some relief to small and subsistence farmers. Nevertheless, it is unclear what Impact the prgram will have on rural povert, as povety alleviation will depend, in part, on whether firmers are successful in investing this capital in the conversion to higher value crops. Moreover, it is also uncertain what impact these policy changes wfll have on the demand for rural labor. 4. The principal poerty alleviation program of the Mexican Government under the Salinas administration (1988 to present) has been the National Solidarity Program (Solidarity), managed by SEDESOL. Through Solidarity, the national government is channeling over US$2.2 billion in matching grants to states and municipalities each year, principally for infrastructre investment (eg., water supply, roads, education, electrification, and health) and direct transfer progams to the poor such as the school scholarship program and inorest-free production loans to poor famers managed by municipalities and the National Indigenous nstitute. In each sector, Solidarity is used to direct fimds to the poorest populations, to complement existing sector programs of the federal and state govermets At their best, Solidarity progams have contributed tD the greater decentralization of 1. From Meaxico's National Stistics and Geoghical Imaton Insti analysis of 1992 household srvy. A new anlysis of the 1992 data indicas that the peente of the poor living i rum! areas may be as high as 83 prcnt 2. Thoso figur ae based an Wod Bak alysis of th 1989 Household sutr.  -2- the provision of basic infrastucture and encouraged active community involwment in oeCal govenmn decision-making and the implementation of imestments. S. In addition to Solidarity, Government is taking steps to realign the role of the federal govermnent and the ftcusof-rural Investment by: (a) reorienting agricultual research, services and ivemn t to place higher priority on rainfed agriculture; (b) increasing decentralization of gwoernment investments and services, strengthening the participation of state and municipal government and conmnunities; (c) modifying the fbrmula for distributing federal revenue shariv& making the per capita distribution more equitable and increasing resources going to poorer saes; and -(d) increasig-national public expenditures 1br social sector invsm ents in health and education, and reorienting those sector activities to better target the poor. 6. Project Objectives. Mhe overal objective of tie project is to 1ncrease access Of rul poor and indigenous communities to basic social and economic irastrcure (especially roads, water supply and schools), and to income-generat activities and thus alleviate poverty. he project would continue efforts initiated under the first Decentralization and Regional Development (DRD) project to strengthen the participation of poor, rural communities in local government investment planning and implemenuation and to strngthen the institutional capacity of state and local governments to support rural development efforts. The specific objectives are to: (a) improve basic infstructure and support income-generating inmestments in poor rural areas of the eight states; (b) strentWben instiutional mechanisms and capacity at the federal and state levels to plan, supervise, monitor, and evaluate rural water supply, rural roads and other rura development strategies with the participation of municipalities and beneficiary communities; and (c) strengen the capacity of rural and semi-rural municipalities to finance, plan, implement, and operate rural infrastructue investens, using appropriate technologies and participation of affected communities. 7. Project Description. The five project components are: (a) Municipal Investment and Institutional Dewelopment (US$737 nillion). This comnponent would finance small-scale community selected and managed works, for water supply development, rural roads, school rehabilitation, productive activities, and other small infrastucue works of priority to rural communities, thrugh SEDESOUs Municipal Funds and school rehabilitation (Escuela Digna) progms. The component would also develop the fiscal, administrative and tedhmical capacity of rural and semi-rural municipalities, through studies, technical assistance, t and support for legislative and regulatory reforms at the state level. Individual infastructure investments in this component would not exceed US$50,000. Communities would be required to provide 20% of total project cost in cash or kind. Approximately 54,000 small inestments would be implemented in the eight staes under the project. (b) Rural Water Supply (US$178 million). This component would provide potable water to small rural localities (between 500 and 5,000 inhabits), by financing iunestments whose technical complexity and cost make them inappropriate or ineligible for the Municipal Funds program. The component would also improve the capacity of state water agencies and municipalities to manage wat supply invesme and operations and maintenmce efficiendy and effectively. Subprojects would be selected and contracted by state water agencie*, using established investment selection criteria and standard parameters for engineering design. The averge watr supply  -3- sub-project investment would be aproxmatly US$120,000, with V 1,300 ru water supply systems to be cotucted or rehabiitaed under the project (c) Rural Reads Rehabilitt and Mainteance(S ilon). Tbis component wuld fianc the rhabilion and mateance of priority sectios of the ru d ne*tok, while dewlophig the capacity -of state road agencis and municipalities to do so efflciently and effdcvely. Rabiitadon investments wod be maaed by sae road agencies, selected bad on an esblished set of crea, and dsigned according to st rd prame and t on averaw US7,000 pri . Municipiies and t would have an active role in implemeation, with _labor intnie works coaced to municipalities through 3ntergoernment agreement A mucipal minte program to cover roads rehabilted would -lso be finced. - Approimaely 15,60 km ofrural roads would be imprved and included in a municipal ntenan progam under the prject. (d) hncomreG ng Component (US$12 millio). Ihis compovat- v.-ld pmvide technical assistance, trainingt and limited iesment to develop and piloiew staties to support income-geerat projects in n- : areas, 'v sagtheing incomeenerating activities in the Municipal Funds prgram and oy suppordtg the development of income-generating programs by state agrdultu agencies in one or two pilot stae. (e) SEDESOL lnttuional Stregthening and Project Coordiudon (US$35 miMon). SEDESOL's capacity to manage the project-financed progms would be stengtened. Fiancing would be provided for a program of institutional developm technical asistance and traing, contactg of technical expertse required for the supervision and revw of each component, and continued development of the project ilnrmation and monitoring system. Annual project audits would also be financed. 8. Projet Costs and Fhmang. Total project cost .is emated at US$1,095 million (Schedule A). The proposed loan would provide US$500 million, the fideral and project state governments US$443 million, and the beneficiary communities the balance of US$152 million. Of the toa project cost, US$1,082 million involve imNestment and US$13 million incremental recureat cost, for the nra roads mainteance progm. The proposed loan would finance appr4imately 46 percen Of tota costs including 100 percent of all instittional development activities (technial assistmce and trang), 90 percent of equipment costs, and 50 percent of engineering, project coordinaion, and all inestment costs eucept flr inesments managed by communities (i.e, Municipal Funds, Escuda Digna, and some water supply subprojects). In the case of communty-managed ivestments, beneficiaries would contbute 20 percent of subproject costs and the Bank and Government wDUld each finance 40 perent 9. lb support the stt-up of instituional development activities and the Municipal Funds progrm in the twur project stes not included in the fit DRD project, retroactive financing of up to US$40 million is recommended for eligible technical assistance epdiue and Municipal Funds invents Incurred after February 1, 1994. Schedule B shows the amount and methods of procurent and disbursement, as well as the disbursement schedule. The timetable of project processing and the stu of Bank Group operations are gien in Schedules C and D, respectiely. A map showin the eight project states is also attached. The Staff Appraisal Report No. 13032-ME dead Augu 19,194, is being distbud separately.  -4- 10. Project Implementation. At the nationaJ level, the (General Diueztorate fbr Regional Development Programs of SEDESOL would be responsible for overall project implementation. Responsibility fbr individual subprojects, -however, would lie with the municipalities and communities for the Municipal Funds and Escuela Di8na programs and for small watr supply and rural roads works contracted to them by ste agencies. Responsibility fbr the rural water supply, rural roads, and income-generatng progms would belong to the state water supply, rural roads, and Wricultute agencies, respectively. The link between SEDESOL, which provides a 75 percent matching grat to finance these programs, and the state agencies and municipalities is the state Plannain Secetariat which chairs the state Planning Commission (COPLADE) and is -responsible for planning all state imnestment. The Planning Seretaat agrees on an overall budget allocation for Solidarity with SEDESOL and the alloca.n of Solidarity funds within the over 30 Solidarity programs. lbgether with the COPLADE, the Planning Secretriat is then responsible for reviewing, approving, and channelling specific proposals for financing within each program to SEDESOL, and is responsible for monitoring implementation activities. 11. Within this framework, communities participate in proposing investments for all components, but are most involved in the development, selection and implementation of the small scale investments under Municipal Funds and Escuela Digna. 7b develop proposals each year for financing by the Municipal Funds, each community holds an open assembly to discuss and establish local priorities for investment. To review and ,rioritize community proposals, the municipality fDrms a special Municipal Solidarity Council made up of municipal officials, community representatives, and presidents of the Solidarity Committees established for each inmestment. Once the annual Municipal Funds investment program has been defined, the Solidarity Committees are advanced fimds necessary to begin implementation. 12. Project Sustainability. Project investments are likely to be sustainable because: (a) participation of communities and local gernment in investment selection and financing wodd lead to greater commitment to local financing and management of operation and maintence; and (b) investments focus on relatively simple technologies that can be maintaed with minimal expense and technical expertise. In addition, mechanisms for bottom-up planning and community participation that have been created and fostered by project components are likely to be continued as an effective means of ensuring that federal povert. alleviation resources are well utilized. In the future, as sources of direct revenue are developed for poor municipalities, the model provided by such programs as Municipal Funds may assist municipalities in effectively programming and utilizing their own investment funds. 13. Lessons from Bank Experience. Mexico has a twenty-year history of support to regional development efforts, many of them supported by Bank loans (integrated Rural Development I, II & m as well as the current DRD project). Lessons learned from those experiences include: (a) the importance of integrating poverty targeted investments into normal planning channels in order to ensure political and institutional support for the effort and bring about sustunability of the efforts; (b) programs in which communities participate in the selection and implementation of inmestments tend to be more cost-effective, transparent, and responsive to community needs; (c) the financing of works in many different sectors, by many different agencies (as occurred in the first DRD project), dilutes project supervision efforts and reduces its effectiveness; and (d) oranizational arrangements and incentives at the federal and sme levels continue to contribute to the lack of attention given to rural areas in spite of project objectives. These four lessons have been take into account in the development of the Second DRD project in that it will limit its major sector investment components to financing specific investments in only two sectors (rural water supply and rural roads), and a majority of project financing will go to inestmets which are selected and implemented by beneficiary  communities. State and municipal govemments will have a central role in planni'ig and implementing each component, and the project institutionat development activlties -and organizton of intra and in-stat groups to address rural development issues will assist state governments in r-orienting their bureaucracies to provide greater assistance to poor, rural areas. 14. Ratonale ftr Bank hnolvement. lhe proposed project is consistent with the Mexican -goernmes broad srategies for improving poverty all viation tbrough its Solidarity program, and with the Baks Country Assistce Stategy approved by the Board on June 9, 1994, which seeks to expand and imprv programs atacking poverty and to strgthen the roles and capabilities of state and municipal auhrities in the delivery of services. The first DRD project has provided an opportunity tD test several approaches to achieving these objectives. The Second D1RD project would build on tbis experience and seek to further devlop and institutionaliz strategies relating to communty parction, municipal development, and strengthening of rurl water supply, nual roads and pilot income-generating progras managed by states and municipalities. 15. Agreements Reached. During negotiations, agreement were reached: (a) that all project components would be carried out in accordance with the Project Operational Manual; (b) operational mauals for the Municipal Funds and Escuela Digna programs and guidelines for the rural water supply and rural toads components, including subpro3ect eligibility criteria fDr each; (c) list of candidate roads fbr the rural roads component; (d) promotion by SEDESOL of the transfir of federal roads rehabilitated under the project to the states' road inventory; (e) institutional development program fbr each component; (f) model contracts and agreements for direct contracting of communities and municipalities; (g) structure, role and responsibilities of the inter-state technical groups (ITGs), municipal support units and municipal presidents working groups; O) staffing of SEDESOL's central and stae level Project Coordination Units (PCUs); (J) reporting schedules and the contens of semi-anmnal and annual progress reports, project performance indicators, and *, mid-term project review; O) annual conduct of a project physical performance evaluation; (k) annual audit of project accounts; O) conduct of a study of community proement by December 1995; (m) maintenance of the project informatiok. and monitoring system; and (n) model agreement (anao de ejecucidn) between SEDESOL and the project states for the implementation of the project. 16. Conditions of loan effectivene are (a) SEDESOL would adopt the final version of the Project Opational Manual with annexes, as agreed by the Bank (with the exception of the technical annex for the inoome-generating component); and (b) SEDESOL would provide evidence that the project Infmation and monitoring system is functioning in the SEDESOL delegation of each project state and at the central PCU. A condition of disbursement for the income-generating component is the completion of a Project Operational Manual annex for the component, including implementation plan and related guidelines and indicators. 17. Project Benefits. Project investments would result in an improved standard of living for approximately 10 million individuals living in relatively isolated rural aeas, with the improvement of access roads, water supply, educational and other basic infrastructure. The rural water supply component inxetments will result in raising access to water of rural population In the eight states from 48 percent to 63 percent. Of the 50,000 kilometers of earthen, rural roads in the eight states, 29 percent (or 15,600 kIn) will receive spot imprvement and maintenance, resulting in greater access of approximately 4 million rural dwellers to social services and economic activities. Approximately 10 million individuals are expected to benefit from the estimated 50,000 Municipal Funds and Escuela Dg8 investments to be implementd during the project. More imporantdy, the project will strengthen the capacity of municipal government and communities to work together to define and address priority needs in poor rual areas.  -6- 18. Eiwronmental Aspects 'Me pwposed project has been rated ZB, as no m;jor Irne nal issues are foreseen. It would support rhabiliation and maintnan of eistig ru inftructure, including rura roads, water supply and schools. Construction of new inastructure is limited mainly to small scale water supply systems, school buildhigs, and small producdve enterprises. No new roads would be built under the ptoject and rehabiliation efforts would be limited to spot impovements. 19. Ibverty and Proa ObjeiWve Categories. Progm of Tlgeted Intevion Project invments wiSl be tageed to. the poor rral areas of eight of the poorest states of Mexico. lugeting to the rural poor will be achieved though: (a) the kinds of projecs finaced (eg., small, inexpensive projects for wat supply, earthen roads, and school classrooms); (b) implenion by community groups avidin the selection of in ments not responsive to commity priorities;- (c) payment of laborers for rurl road rhabilition and maintenance wrks, resulting in employment genemion for the poor, and (d) distrbution of resources by formula to prwvide greater fundig to poor rural areas. Indigenous communities and womens groups are to be specifically targeted within the income-generating component. 20. Project Risks Possible risk arise from: (a) the relatively weak institutions at stato and municipal leels, leading to investment decision-making based on intests not conistent with tecbnical criteria, and to poor technical Input in project design; (b) number of institutions inmlved in project executon leading to overly heavy supervision burden; and (c) the extent to which genera criticisms of Solidarity may reflect on the credibility of the project. Tb address these risks, the project limits investment to techlicaly simple, but highly economic works (eg., spot improvement of roads, small water supply schemes, etc.) for which simple selection citeria have ben designed and agreed during project preparation. In addition, targeted programs of technical assistance have been designed for each project component to stegthen the state line agencies. lb make project supervision easier and improve the project management, iTOs wwld be formed and would meet quarterly. In addition, the mnmber of sectors to be supported by the Second DRD project has been reduced from ten covered in the first DRD project, to four, with strict critia fr subproject eligibility The computerized monitoring system developed during the first DRD project wold continue to be upgraded by SEDESOL and used to provide timely analysis of implementa progress and issues in each state. lb maina the credibility of the project, the project will use clesr and rationa sets of subproject selection criteria, and will monitor implementaon closely, analyzing fDr possible biasing of investments based on other than poverty and efficiency citeria. 21. Recommendation. I am satisfied that the proposed loan would comply wih the Articles of Oe Agreement of the Bank and recommend that the Executive Directors approve it. Lewis T. Preston President Atm-Jments Washington, D.C August 19, 1994  -7- A SECOND -DECENTRAlIZAON AND RGONAL DEVELOPMENT POJtECT _ebutd Piaect C_st and flanin Pln (USS mmi,llon Priect Components l Forin Tbta 1. Municipalvestmn & nutnalDev. 549 149 69 1. Pull W Supply 120 49 168 m. Rual Roads Rehaion & Maintnanc 92 34 125 M Income4aenemtin Componn 8 3 12 V. SEIDESOL Inst Stgth. & Poject Coord. 27 6 33 Tota Boine Costs 796 240 1036 Price CoDgencies 45 14 59 T.tl "Oct Cu--s 841 M 1095 ; - 1 I Financin Plan _Local For6pi Total IBRD 246 254 500 Federal and Slat. Gvernments 443 0 443 Beneficiafies 1 152 0 152 'btal .841 254 1095 1l Figwos niy not add up due to roundig. ,.  -8 - Schedule B pge 1 of 3 SECOND DECENTRALIATION AND REGIONAL DEVELOPM PROJECr Pro-rem t ArragemeU (US$ admon) .. 7-a..,.. ..'... ~~~~~~~~~~~~~~~~~~~~~~. . . A. Civil Woks Larger Woks k 80 (40) (40) Minor WM)ir 7561 756 (306) (306) 1262 126 (63) (63) B.Goods 16 202 36 (11) (12) (23) C Consulting Services . 97 97 ______________________ ~~(68) (68) 'Dihect Conrating 2Shopping N.B. Figures in parenthesis are amounts, includig contingcies, expected to be financed by the Bank.  ~ 9 ' - ~ - Schotue B I%- .2 O3 MEXCO SECOND DECENTRALZATION AND REGIONAL DEVEPMENT PROJECT :Alocation of Loa Amont - Peretage to be financed and Ptvj.A Component by Dibursement Category ID ubwemetateC y Poet Coament No. A-ocaIo of lidb * to be Desription ALoa Amount lImc (US$ Miin % 1. For Municipa Investatcat and InsitaIonlDevelopment, (D) Componet a. wok underdirect 1 2635 SO b. constuion maials 1 t0 SO a. goods (o than constucton material) 1 8 90 d. technical assistance and taining 1 27 100 2. For the Rural Waer Supply (RWS) and R.al Roads Rehbi;iaton and Maintensan OM Component a work undordiret 2,3 40 SO b. works other than (a) above 2,3 90 SO o. goods 2,3 2 90 4. engieering services 2,3 6.5 50 c. technical assistace and 2,3 8 o00 .tnnig 3. For the ncom-G ing a. work 4 3 SO b. goods 4 1 90 a. oenical assistance and 4 S 100 training 4. For SEDESOL strngthening and Project Coodination Component a. goods' 5 2 90 b. longtem consuling services 5 13 SO c. echnical assistance and tain 5 5 100 4. audits 5 3 100 5. Unallocated N.A. 13 N-A. Toal for All Ctries 500.0 Component No. 1 - Muniipal nvestnt and ItiutLonal Deavopnet Component No. 2 - Rural Waw Suppy Coma,ont No. 3 - Ruoal Roads Rehabitation an Maintenance ComponentNo. 4- loomeencaling Componaet f1r^_~~~ U.. s _VT~T - n rlb. T,lnthlfldlil RtImantiigIproi* Coordinaton  ' 10- ' ' u2 14e3of3 Psdmatdle D*butnst Bank NY 1995 1996 19 7m 119 Anual 80' 91 116 i466 CUIA.,t,, so 171 287 434 . I t11 lude. initial deposit to tho Specal AMcunt of US$40 mfiloa and up to US$40 million in rouci bsnclng for .liil. .xpend ncwed afte Ebruul 1.1994.  - 1s - mmao SECOND DECENTRALIZATION AND E DEVELOPMENT PROMECT Thuetable of Key Ng ojec Processig Ev* (a) 'lme teno prepare: 1 mont (b) Pparedy SEDESOL (c) FIr Bank mission: Apri 25, 1993 (d) Appralsa mission departure: February 1, 1994 (e) Negotiatons: July 19, 1994 (t) Plnned date of effectiveness: December 31, 1994 (z) List of reevant PCRs and SARs: LJoan No. Project Report Date Report No. 2043-ME Itegrated Rural Development Project PCR of December Report No. 9175 (PIDER M) 11, 1990 3310-ME Decentbizaon and Regional SAR of Marh 4, Repot No. 8786- Developmen Project for the Disadvantaged 1991 ME States  -12- ScheduleD Page l of 3 STATU8 OF BANK GROUP OPERATIONS IN MEXICO A. SrATEMENT OF BANK LOANS (As of etw 30.1994U Amount in US$ Mullen _ ees_ CedW Fia - Loan Nov . Year Borrow0n se SBnk iDA Undibused 106 loans 8,1w dIs-ursed 13,472.72 Of which 020AL SAt, Pogrw Lom an Ines Suppot a.- Ln 1929-ME 1981 -SANOS Ralwy IV 140.66 Li 23141ME 198 3 ANCOMEXT Exprt Deveopnt 34.33 Lu. 2862-ME 19" SANC0MfiT Trad Pokiy LoanU 500.00 Ln. 2910ME IS16 NAFRN Acltura 8eto Leo 300.00 Li. 31590iE 1900 8ANCOMEXT Intret Support Loan 1,260.00 Lu. 3207-ME 1990 BANOORAS Road Trwvpet & Telolom. 30.00 LI 3067-ME 1969 NAFi Indusmiatr Policy 497.51 Lu. 2745-ME 1987 SANCOMEXY Trade Poli LoanI 4s.63 Ln. 5086644 109 NAFIN Pubi Ehtarpde Rbfnm 499.39 Lu. 27774M 1907 8ANCOMEXT Expoft Oweopment I 246.37 Li. 2619-ME 1998 NARIN Fotliz Sector 240.20 Lu. 3309-ME 1991 BANCOMEXC Export Sctor 26.00 in. 3367-ME 1991 NAiN Aiulal SetW Ad). ll 400.00 Subtoa 5,346.31 IL. 2675-ME 1965 BANORA Ralway V 300.00 4.62 Lu. 2666SME 1980 NAFN Alcultme Dev. PrdhII 66.30 34.44 Ln. 260ME 1980 BANO8A dMnoal Strengthening 40.00 2.63 I. 266"ME 1966 BANOIRAS Solid We LMacagmat Piot 25.00 10.91 Lu. 2824-ME 1987 BANOBRAS Urban Transport 90.96 24.34 Lu 28650ME 167 NAFIN kM buty IV 100.00 17.73 Lu. 2675-ME 1967 BANODRAS Hway Maintenance . 2.78 LI. 2916-ME 1906 NAfll- Stoel Setor Retriu_turn 321.01 58.40 Ln. 2940-ME 1066 SANOBRAS Pore Rehabilitation 47.66 1.62 Ln. 3047-ME 1989 NAFIN Industal Restruictrng 260.00 31.95 UL 3063-MAE 1966 NAFIN Hydrodeetri Developmet 400.00 86610 Lu. 3085-ME- 1989 8A ICOMET FPnancIWa Secto Adpustet 487.14 0.73 Lt 31 15.ME 1990 NAfIN Forstry De_vopmen 45.60 36.98 Ln.S3140ME 1990 SANOSRAS Low-income Housing 9S 860.00 31.22 In. 3141-ME 19t0 "AiN Agrclnr MaLcatin II 100.00 0.47 Lu. 3169-ME 19s0 NAFIN T _arnisalon & DiOstuton 460.00 100.s6 Lu. 3209-ME 1900 SANORAS Tsolonunia Tohrdcal AssIstance 22.00 3.80 Lu. 3271-ME 1991 BANOSRAS Watw Suply & SaItaton 300.00 11.91 Li 3272-ME 1991 NAFIN basi "HealtCar. 180.00 85.26 Lr 3310-ME 1961 NAFiN Decetalabn Regioal DOevp. 360.00 63.17 Lu. 3366ME 1901 NAFIN TehaticlTrak*v In 182.00 88.32 Lu. 3359-ME 1991 NAFIN Mbin Sector Restucturins 200.00 111.73 Ln. 3407-ME 1662 NAFIN Prmay Education 250.00 133.57 Lu. 3419-ME 192 NAFIN lrrion& DraI_age Setr 400.00 229.92 LL 3461-ME 1992 SANONR Erronne_dnteMears PRaguce 50.00 37.4 Lu. 340641E 1092 NAFiN AgrIcut Teoloh y 150.00 139.08 Lu 3476-ME 1992 NAFIN Sciece & Teohnoy Inraruotwe 169.00 161.38 n 34874-E 1962 BANODRAS Housin MotDeselopmn 460.00 197.00 Li 3118-ME 1993 NAFIN Inhia Education 60.00 70.64 Lu. 35424M 1993 NARN Lbwr Marlet & Prod. EiAnm1 74.00 130.49 Lu. 3643-ME b> 1993 NMAIN Trnpot Air Pollution Contl 220.00 220.00 I.9 36S9-ME 19993 SANORAS Media CWit Trasprt 200.00 188.01 Ltn 3629-ME 1993 BANORBAS Hkihway Rhab. & Traffc Sdfty 480.00 391.97 Li. 3704-ME b>- 1994 NAFIN On-Fem & Mior Iratin letworik 200.00 200.00 Lu 3722-ME b> 194 NAFiN Primay Eduon 412.00 412.00 UL 3760-ME b> 1994 BANOBRAS N. Borde I En08ronawd 366.0 366.00 Ln. 37614E b> 1094 SANOBRAS Wer/Swntatlon ii 350.00 350.00 Lt.9 3752ME b> 1904 SANOBRAS Soid WastU 200.0 200.00 Total 22.140.31 4,24S.63 Of Which has bamn rpaid 0.71 3.64 Total now hldd by the SoSk 16,426.77 Amount a 92.34 Of which h. been ipa 912.34 Total Unddsbursed 4,245.53 4.246.53 s> Approed durin or afte FY60 mnd iy dimbmurad. 'SAL, SCA0. or Progrm Loa under Inipnwation b> Not yet effdtv lIdeS: LA2C1 Filo Wi 1O4xh 12-Jun-4  - - a a a a - .. a a - -a- a- - - a -- - - - t~~~~~~~~~~~~~~~~~~~~~af mPP~~~~~~~P 3. 0~~~~~~~~~~~. . . . . . . . . . C I ~~~~~~~~~~~~~~~~~~~ ~~~~~~~~ ~~~ ~ ~ ~ t  -14- Schedu-eD PAEUC Page 3 of 3 SUMMOAY OF IFC INVESTMS so of I 30. 1t CORN~ conawav no of nowea soft rawinw We a nm b SS PIne Ye b- PeCS IluIi 162 AMmuds Len LA. 4. COV. t lnu 1. - 17.03 1CQ00 IfIMS Gam" Peoed_.. . 0. CV. Towabm 2000 . 37.22 5722 - 20.00 33.50 1ow Oap FknacieS Mute" S.A. do CV Oe_epm_w wnc * 7.60 - .6W 7.60 12 Ses MaronS tde Ne. LN.CM Development O Fblp. 20.0. - - 20.00 20.00 7.30 160 Wades Citb Takoe Teo 7oen &t -Lea 17 .- 13.76' -73 tO03 eese O tSA a C'. Tdoa 120 * 26400 q