Announcement of Five Million Two Hundred Thousand Dollars IDA Credit for Mauritius Tea Growing Project on April 1, 1971

• INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 IDA Press Release No. 71/10 Subject: $5.2 million IDA credit for April 1, 1971 Mauritius tea gxowing project The International Development Association (IDA), of the World Bank Group, has approved a $5.2 million credit to Mauritius to help finance a tea growing project that will help to alleviate a serious unemployment problem and reduce the nation's heavy dependence on sugar. Mauritius is an island in the Indian Ocean about 500 mil~s east of the Malagasy Republic. Its economic development is seriously hampered by population pressures and dependence on one crop -- sugar. Despite a marked reduction in the birth rate over the past decade, population density is • 1,100 per square mile and will continue to increase for many years. result, unemployment is high. Sugar plantations occupy approximately 95% of cultivated land and sugar accounts for 95% of exports. As a The project represents the second phase of Mauritius' smallholder tea development program and will add about 5,840 acres to the 4,000 acres planted in the first phase, which was completed last year. It is expected to create 4,100 new jobs and generate foreign exchange earnings of $3.0 million a year when the tea bushes reach maturity. The financing will assist in. establishing a Mauritius Tea Development Authority (Ml'DA) (Wooton, Curepipe Road, Mauritius), which will be responsible for implementing the project. Crown land made available by the Government will be cleared, prepared, planted in tea, and ·maintained by the Authority. •• Two tea factories will be built, increasing processing "capacity by about G million pounds, and laboratories for improving tea cultivation will be established. /more  • IDA P.R. No. 71/10 - Mauritius - tea growing - 2 - When the tea bushes are firmly established, plots of 1.5 acres each will be leased to individual smallholders by MTDA. · The Mauritius Cooperative Central Bank will provide seasonal agricultural credit to the sma·llholders. The IDA credit will meet all of the approximately $2.4 million £~reign exchange cost of the project and $2.8 million of the local cost. The remain- ing $1.8 million will be financed by the Government of Mauritius. The project is the first World Bank Group operation in Mauritius since it became an independent country in 1968. The IDA credit is for a term of 50 years, with a 10-year grace period. It is interest free but carries a 3/4 of 1% service charge to meet IDA's administrative expenses. - 0 - • • .