Announcement of Five Million US Dollars Loan, and Three Million US Dollars Credit for Tunisian Agriculture on July 6, 1971

7//c~ INTERNATIONAL BANK FOR \)"·''1\1.0p,lt,s,l), .'!' RECONSTRUCTION AND DEVELOPMENT ! 7~ t,~} INTERNATIONAL DEVELOPMENT ASSOCIATION 18 18 H STREET, N. W. WASHINGTON D.C.20433 TELEPHONE: EXECUTIVE 3-6360 Bank Press Release No. 71/64 Subject: $5.0 million loan, $3.0 million IDA Press Release No. 71/32 credit for Ttmisian agricultura July 6, 1971 A project to increas~ wheat and dairy productiot!:::::tn northern Tunisie and to create desert oases for date crops· in the south of the /!,funt:ry will be assisted by World Bank Group financing, it was announce,,!' today. The World Bank is provid.:1.r.g a $5 .O million loun and its affiliate, the International Development Association (IDA), is supplying a $3.0 mil- / lion credit to cover the foreign exchange component of the estimated $15.0 million project cost • • The project is expected to increase production of wheat, dates and off-season vegetables, resulting in foreign exchange earnings or savings of about $8 million annually. In addition, it will expand milk output to help meet rapidly rising domestic ;demand. The project will be implement~~ in the private (~ommercial farm sector. Approximately $9.0 million of project costs will be for grain farm 1~chanization in the north. Banque Nationale de Tunisi-e (BNT) will provi~"iE. \\ some 850 grain farmers with credit for purchasing mechanized farm equipment. Almost one-quarter of the costs will be the financing for creation of oases in the southern desert with approximately 18 date-palm pla~tations averaging about 125 acres. This component -- including wells and irrigati :>n., _ land preparation, nursery stock, equipment and buildings -- will be carrie~ • out by Societe Tunisienne de 1' Industrie Laitiere (19 Rue de Port, Tunis, /more  :;:i Ba11k P.R .. No. 71/64, I:O.\ P.R. Nd. 71/32 - Tt..ti13ia - 2 - Tunisia) which processes and markets most of Tunisia's date crop. The plantations will eventually provide jobs and housing for abo1~t a thousanc~. • /-,, desert nomad fa~~lies. The balance of the project costs will be for assisting in the develop- ment of dairying through loans to dairy farmers for purchasing irrigation and mechanized equipment, farm improvements, and new livestock. The Bank loan is ,being made to BNT, (19 Avenue de Pads, Tunis, Turd.sis:) which w:f.11 carry out the project, andc:is guaranteed by the Government. It. is for 15 years, including a five-year grace period, at 7~%. The IDA credit is bei.ng made to the Government, which will relend ir: \\ \i to BNT. It is for 50 years, including a lo-year period of grace, and i~ administrative expenses. \ I interest free except for a 3/ 4·' of 1% service charge to meet IDA' s Financing will also be provided by sub-borrowers of the BKT loan -- • approximately $4. 3 million; by BNT from its own resources approximately $2.5 million; and by the Government -- $200,000. - 0 - •