Announcement of One Million Three Hundred Thousand Dollar Credit for Livestock Development in Tanzania on October 23, 1968

• INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET. N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 IDA Press Release No. 68/27 Subject: $1.3 million credit for live- October 23, 1968 stock development in Tanzania The first stage of a livestock development program intended to diversify Tanzania's agricultural production, the mainstay of the economy, will be assisted by a credit of $1.3 million from the International Development Association (IDA). The funds will be used for the development of five large ranches encompassing 420,000 acres to increase the output of beef and expand the production of breed- ing stock. The five ranches will be developed by the National Agricultural Co. Ltd., • a subsidiary of the National Development Corporation which was set up by the Goverrunent to develop certain sectors of the economy along commercial lines. Three of the ranches are already established and two will be new. Finance will be made available for such investments as on-ranch roads, firebreaks, fencing, water supplies, stock handling and animal health control facilities, ranch buildings, breeding stock and the initial procurement of feeder steers for fattening, and for technical services and a training program for ranch management. The IDA credit will finance 65'7. of the total estimated cost equi- valent to $2 million. The credit will be extended to the United Republic of Tanzania for a term of 50 years, including 10 years of grace. It will be free of interest but a service charge of 3/4 of 1% will be made to meet IDA's administrative costs. The Government will relend the proceeds to the National Development Corpora- • tion on the same terms with interest at 4%. The Corporation will in turn re- lend the funds to the National Agricultural Co. Ltd. at 7% for a term of 12 years including a five-year grace period. /more IDA P.R. No. 68/27 - Tanzania - Livestock - 2 - Agriculture provides a livelihood for 901. of Tanzania's 12 million people, • most of whom live at subsistence levels. Cotton, sisal and coffee are the prin- cipal exports, with cattle and livestock products accounting for only 3 to 41. of the total. In face of uncertain prices for the main export crops, diversifica- tion toward beef is most important to the country's economy. Like its neighboring countries, Kenya and Uganda to which IDA recently ex- tended credits for livestock production, Tanzania has extensive range lands and a favorable climate for cattle raising. Most of its national herd of some 10 million head of cattle are in the traditional sector, where the size of an owner's herd rather than the quality is considered most important, and less than 3% from this source is marketed annually. Potentially there is con- siderable scope for increasing these sales and even more for raising the average weight of slaughter cattle. Fattened stock brings a considerably higher price in the market per pound so that fattening is a profitable enter- • prise as well as a means of quickly increasing beef output in Tanzania. One of the ranches to be developed is expected to be for fattening only and the other four for combined breeding/fattening operations. The development to be undertaken on the ranches will increase the output of beef for local consumption and export and reduce imports of breeding stock. Additional benefits will come from the demonstration of better management prac- tices, improved production and disease control techniques, and the practical training of ranch managers and field assistants. - 0 - •