Bank operations in Colombia : an evaluation

Report No. 2-18 "CW*PDENTP&  SVGGESTHONS TO TIE READER Fsr Che reader w h 'has jnot -re than an hour or So. the quZ&ea8- way ato get an Sn%tial impresston of the general t h r u s t of thPs report and i t s central cenclusilonei and re dat-Bans m 2 d k to read Q a) Utter of Ttienmftml [pp. ii-8x1 (b) h e M w sf the b k n s EEffectivmess (pp. 29-34) (c] Chpter K -W%2a.~ig~al -3atilosa91 HmplTcaltbonsr (pp. XR2-189) datlions icz ould be obtafned by fmking, km p?&ftbo~~, at the f%nalssectlon 9% each chpter of ebc r q r t other than the f i r s t and the .bast. h p t e r IT, me Wpagld a d WPmb%a, preseats, &sides a br%ef bis't:@rf~a1 revlm, the overall assess- wna: of the con~rfbuxr%m t o a@oldfan deweltapnt of the amb f r s varfrpprs operatfons.  INTERXATIBNAL BANK FOR RECONSTRUCTION AND DEVELOPMENT 1838w EW.N~W~ ,a c. 28433, USA. Sta.LTrE*. - -Y - - % b b . O ~h i~ anr-XhW May 18, 1972 Hr. Robert S. Bf r a , President International %ark f o r Reeonstructfon azd Develetmelht WasBaiwtoar, D. C. ".IC4ais report i s the m t e m e of an experbent, The Operations Eva'l- -tion D i e s i a m was established in the Pro and Budgeting Depart- =eat of t h e 3ank i n S e p t d e r 1670 t o e m 2 coatributlon of the mnk% past wrsti~.ass to d e w e l a w ~ t ,paith a view to learning trraw poli- cBes a d .proeedr~res d@t be -roved in z%e future, SPnce systematic een dome before t o any exteat, i t was decided to start w%th an P p i l o t phase, f n c l d i n g a relatively sraa1.i- ratfve smdy of power projerts ced by the Bank i n several oamatt.bes a d at -re d f t % ~ a rs ob a11 Bank Group oper- ti= d t h one cancry &Emb%a was cboen as t gSe cmntrgr for b i d d y becaase of the length a& reace af the &tr& Gzmp'rt imelamnt Iwjith its d e v e l o w n t and ;bsacll%osesf the ready eanpsefea, of t k *vetma% to emperate with the r t d p , &ween t h b q i m - ~ g = sf %959 a d Zhe end of 1970 the Bank and fM d r s h r s e d ta mlab%a S- a34516 d l l k m en 40 Seaas and credits f o r progeets in 11 d i f f e e ~ l tfSe2ds. %hfs EB t h r e p r e an tk a f l d i a s k d y , PrSnclpaE field work was d m + fn &be ffrst b d f s f 19'81 a d the t d-s sot gefaetally attempt -re rremr eveato. to e~slrsc~tsr amrach to ewrPmtEm m 1 d be to ask d2aethar e 3 i ~ w d i t ~ s r o of g$e SQ514 sE1IIm dfs&rr.pd thrmgh 2970 bad led f a l f i l h n t of the s ~ e i f prpses f ~ far &bcb the lsaw S n gaeotLm ware a n r w e d . This r goostIa,aa itself e w l d b e Saterpretd aa: m ang. lewels. There ls the rela- ~i'op-ely s w 2 e -sfen: A e t b r tk L a n f u d s sere dews& -r6 the pro- j e c t gar d i e &they were d e s i ~ t d a m3 uhirrtber the pregaef: was aeL~211137 h S l t ; t h e qu-tions f aasr e net g f w a us very -meem, fsr the Bank $;lenerallg k d a s t r m g oyst- £or eantraf a d awertt9sfon of d-lsburse- ts. Bt a m t b r l w e I is t E& qtrfmtie~ rkzethr the services provided by e progees, WW c q l e t e , f o a d a ready d-d. Was zhe pawer sold? @ere t h roads used? O r , as a =re elabdrate versim of the same gues- tion, was the t ahad s m la of d -nd sufficient relatfve to the cost and duration of construction of the project t o make it worthwhile? Many projects have had rtgnt institutim-buifding purposes, and clearly there is a para sti- as t o whether these purpo- ses were fulfilled, another tant d5.ste158lion 05 evaluation, re- a11 tbese quest5 whethen: the objectives of the i s k d in ae eff iciat mrws -- or dsd tbe d i t i m that were unnecessary E G ~ z n t ta hlin hsans of expenditure of too s18~Ly, iqose con- g tbe purposes chosen or cause tbe project to be =re e-nsgve f i i h n w m aecessary to m eeat the country*^ see*? mecc 'hard zo answer, did concern US to a s, they c m t f t u t e only a rather PMted m a l ~ i m , of the present study was to as- sess tk eorrtxfbareia ad mp, as a whole, to the development sse~sfor t k h-e. Thds clearly css supported by for their ser- have a desirable t s ? W r e there Lng p'pBPg-s eitsdem? m& tbt ferns s -d f: M t b a these isz;, t w , m t k r r a w of qmsetoas s the pr3ksje~t 1ewe1, tbwc61@ ~ f z e a eCPose9y related t o it. ahice 6 61 sect= & ~ r w ~ o r m i p i lci c i e a ef fectdoc a i d was it oriented tm $krf&t dlkeetim? % k ea-2t policy ~ o a d b t i a of Bank let& Z a g esrar Eive 2 Did s l e d i ~ sqplaat mbilfzatioa of d m s t f c rwoaatcrss sr d i d i 0:e ie"l'as a bC ~ u l t a r i w e . Group ttreaeed by tbe f 3 d ulaat:Mf le & bfl9 the B e Zed br. % .a the a n o t t of fec- tioe way5 %re the tc(e%mrri.caP msfrrzmee a d trabnfag ef-forts of the Bank u s e h l ? W a s &tee h & w i s e ts mm tbse projects &ich it did turn f i s h d m1e by 1e8d&a -re 2 Asrxl Rere a= paraBPe8 qwsti &mt tecZEnZqws: for instance, would b e q l q e d its resmrces, inclad* its m q m r , more e f f i - by d i s - ~ oD po rl gfat laa1 0- rather than only project  Obvioasly, t o each of these questions there a r e many subsidiary ones, but t h i s range of questions describes broadly how we interpreted our evaluation responsibilities. To approach answers t o questions of the type raised i n the last tuo paragraphs, it was clearly necessary t o hatre in mind sare d e f i n i t i o n of devel of which the Bank's effectiveness wss nt -- t h e objective i n pursuit imes it roay be possible t o derive such definitions of vhat devel ans f o r a pcuticular couatry from the statements of p o l i t i c a l rs. mfs was mt e n t i r e l y adequate for atr purposes f o r several reasoag but most iaa- rh.e objectives ma: i t s e l f . I f put it as follmm: ike rose f u l t o k dK k t basis. F r a Che it i s etri that our r r t t e q t has etlw eria w e cou'l of f o r judging Put c r i t e r i a us- i q g the must up-to-date techiqutss m a i l a b l e t o urp. w e have con- try5ng t o bcte , in this way, ebe rrcmal c m t r i b u t i o n , d the pattern lonnbiaa develop- . Uithfn &is br scope we natur- attenttom t o rhethcr snp speeiific aad t e s t a b l e objectives f of a 1 lase1 attained o r not. Oa9 objectiwe wbich progec always had 5s t o yield e f f i - cieacy benefits a t least as great as other typical imestsaeats under way in tbe c c ~ ~ ~ t x y . id we studied there grojec- ted efficiency d in such a sophisticated way relevant and espe- ts a b t the 1 rate of return t o ssstr~nptions p ~ o j e e t ;and we c a q a r e d t h i s with mr e s t a t e e l the actual r a t e of return. Even if ab Panvesmnt -re t o t u m out a satstake, the decision t o undertake t h a t 5n amwe senses mot have k e n a m i s t & ; what went wrong chance t h a t no one s o u 1 d h a ~ b e e n e x g e c t e d t o faresee at the the. Y e t obwimsly, i n retrospect, t h e main lesson t o d Broaar such a case is the need t i l a develop means of f o r e s e e h g t h e occurrence ob such d o r t ~ a a a a t ecbaaces i n the future. Like other zseasates of a project's c m t s i h t i o t o dlevel~pment, r a t e of r e u r n caleulat%o.ons, whether f o r the pahit o r the future, always r e s t p a r t l y on g d ~ n t s . For ~ s s 5 b l e future imrestmnts two stream of c a s t s m d mtpwts W e , L n praincfple, t o be estkmated, representing the s i t u a t i m e ~ e t wLthd t k project and t b a t expected without %t. I n m l y s e s af t k past, s s m s i t m t f m i s factual -- and the h f s t o s i c a l elves may be =re o r l e s s we18 def8iwd d FPithwt the prejeet a mtte -- kt what wmld have nt. W e have been ted not oeiay i t hat a projeer: made but equally i n q ~ s t f o w t rhat difEesencie a: mde, and hence in Id b e w a ; 3 e ~ ~ e withwit d tb B d . %n leach of the? prcrgecks: gaufl seeto ich w e stud%ed Pn C o l d i a , and dadneed i n the &*ole p a t z e ~ ~f "~~dwe1 r, we r e w a t e d l y encwntered obstacles of a d f f f f c u l t E w u a he&@riewd by the very lamgtb of e k twenty-year period m&r @ r u e . Were t k r e a r e strar.ctarraH or irnsrieuticazaal bottlenecks t o ckaargc, t b W c f f 5egem.t a par&iceul;n9 profact fs rated depends p a r t l y an the? .EEex&bfb%ty t h e the leccrnq and sorbety a r e ms-d t o have, and the sEgnfficame i a t t r f b a e d aa tbe cmtribantim of tbe Bank depends i n pare on asses t of f e s s.~ntrbbat&on t o msbag and p r ~ t b w struc- tural a& i m a t i e u t b ~ change l fm -a d i r e s h i m faavgrable eo development. W cmprehensiw c a n t r y P ~ W ~ ; OtMoC ewc11wtfan ~ helps to iisarlprowe these necessary but a3iff%cult jmd@mts. d few v f m t s shmld a l s o be made abtt our approach t o Colombia, The b i t s t c-aeer of t h e report serves p a r t l y t o c1arIfy mr definit8an of d e v e l o p a t by actual 01pcrario;rrtlk appXfeaCfm of i t and partly t o dis- tfmgufsh, a t tbe bread level, what W l m b i a &as done, covered i n tbat c h p t e r , fram what the Bank bas done, dis~assledf n a l l the other chag- t e r s ; f o r readers mew to GoPmbia f t wjtljl serve as a n essential introdue- tioaa, wh%le f o r r h s e already f m i P h r ~ 5 t h the country it rill indicate rbe degree a d nature of unlilerstadfng we reachied. While the report i s i n no sense an evaltaation of the perf nce of t h e Calmbdan a u t h o r i t i e s i n t h e devela-nt of their soramtry -- it is the Bank which is being assessed and f o r whfch we t r y t o derive lessons -- much of i t is never- t h e l e s s necessarily about problem confronted by Colombia. Although, i n order t o save space and avoid repetition, we have seldom made t h e point, we believe t h a t very few, i f any, of these problems a m peculfar t o C a l a b i a , In assessing and judging t h e problems we have expressly t r i e d t o treat G ~ L d i h a term of i t s s o c i s - p o l i t i c a l system and t r a d i - tions. Satber r a r e l y La the repor we make cmparisons with other Latin Axeericam coruatries. Inevitably m ar ja n t s are probably affected krs~plicitlyby c . q a r i s o n w i t h other countrfe Bept whenever such crampa- r i s o n s do a f f e c t our j u d p n t s , we have expressly t r f e d t o make t h e per- spectiwe ilaternatbomal, covergng Bank r countries i n a11 continents. 13 r of fntelzaatiianal and foreign assistance agencles other thata the W& --p a r t f c u l a ~ l yIDB and U.S, A wolved %a & 1 d i m d e v e l o ~ n since t m-- have been closely in- the k g j l m l ~of the 1960s and, fhout&g8P we mk frecyraent regerenee to t b S we newer go i n t o d e t a i l about . thosir a ~ t f ~ & . P & e ~pr&ncIpal r e m a n I s 06 eoutse t h a t we had no a~rhasrnryto rewfiw a;-, @e dfd go t o s m pat- t o EmB1%arfxe our- selves in mneral wfth tahdmt they had d - and the p t o b l m itbeg laad en- cmrstered, d iin tk cwtsle of t4hia-k w e &veP-d s- nginfom and h- presslaw, but hawe studiwsB/y moidaled co~'~7eyf-such rere b p r e s s f o n s %a c snt ar rri?pr&, "fiat o t h e r ~ s c i e hawe s been dog- m t u r a l l y had some e f f e c t m wr sa@esE&- a h t T&BD the Bank sbmld do t o increase its coatribebm t o C o l d i a n d-lapm. kt ~hesiesuggestfmrs w:te based pr&-rfly am ~owerg%m8 warns d ~ the m war&msp a r t s ntE our study about the w e h r area v%sfaPle fn the meaal%pattern kPd d e w e 1 0 p n t i n Colsnn- bta so that, *&ewer o r b r e m i @ t have done, there was clearly need f o r eakeir e f f a r a s as 'be ssrpplmmted, t W fat. k t osatrpslld be passible a d &sirable for us to f o m l a i t e al- -- temartiie p s s f b l e straeegfcs of p a s t C a p I d % a ndwellrapent was a dike &icb c o n ~ e m e d US t:tasm&oafit tk s t d y . Xm one sense f o r jllclging ae t b e aaeroeco- B a t ' s advice, e s ~ c i a l l y -- r e t r o s p c t i i w t~al&dL 1.ra~4sfc Pew61 it wo k e n wry nsefv8 t o elacfamHa&ps %;ad t h e e w d e l capturing Far fmstance, it muEd, f a principle, have embled testiag altematkwe patterm of a l - l~-eatfan of Jinwesmnt rr?smrees a d foreign exchange. I n p r a c t i c e t h i s was not possible because of the very poor data avaflable on dntersecto- ral flows i n alorebia and on actual alleazation s f investment among sec- t o r s ; even infomatian on tb sectoral a l l o c a t i o n of public investment, for instawre, i s available only f a the last few years. Howewer i t a l s o seemed t h a t t h e deeper potential of our study, within the time t h a t was available, was i n term of deta5led analysis of projests and Indiwidual sectors, a & rilieroe ie 4sector relationships, Ollt aallyses a d eonclusf- wtufaiPy ileipend sigaificgptPy on tbe q u a l i t y and aecutaey of the data we h m e had at our disposal, Scarcity of good f a c t u a l iafo-tim bas eonst our efforts, The work of sbeler c o l l e e t & a of A l l who uo+d prevtoam experi- ence in statbsticetlt e jd8ciow as we c m l d izl t but f~l;rrrsfb&ly w? w e not rwe&rch = a - well ybld Bank techniques are s u f f i c i e n t t o avoid recurrence of such a problem. A t the detailed level t h i s would have bean smewk.it beyond our capabili- t i e s and it w u l d a l s o have further increased the s%ze of an already long report. Ona tk other hand, our knuwledge of current Bank policLes aad techniques has of course greatly afgected the emphasds that we have given i n the rec Irdatiom l i s t e d a t the end s f each o f the sectoral chapters and fn the final chapte l e s s few of the problems i d e n t i f i e d in t h e report wr,l be to readers familiar wbth the Bank's -rat%=, and mst of t dram constitute reinferce- m n rt to variou;s treds i a csrent thi&w, Znfo~llrtalself - e v a l u a t i ~ a tfmmslg urPde g the opeacatSng departments of t h e Bank 1 ~a ns 43 more erpalmtion stud-ies, such as t h i s one, are LiDlety to produce mfaPy case materfial s u p p r t f - changes %n policies and pr~cedmresEar a i e b tbe m eed has already been sea, a t Peast p a r t i a l l y , Onrcr last 'vord crh emtkoaa datfoars regardgng future Bank =tion *%& we pug forvplrd : lt bas not k e n part crf mr r a ~ ~ ~ m f b i l i tei, f e cam&&r s Sa imy presise way the costs of ear- -bag th- wt, mturally. we h v e had Bdgetargt Bhitazlwr5 broadly ia ~ g n a% t e m , batl: s - 06 a r m t 5 ~ r t m rec t a t % o m may have s%@bfiemt WIicls~tP-, M ~ e a s ~ p h i e h m B f a seed t o be assessed be- Sere &cSd5- 5:k pace a t -5~ifS "iky sbmld be .cslrr&ed taut, W n t b study w a s %Lltst bf- comejitted a r of very useful emmrasatdam =re beId fn W m a pzebctalarlg with Dr, Vfrgflio fss CslotrrbPa, W, Edgar S;utberfez, famrfy afef 0% the past two -2o'b:-t part .in the &sign 1131 extensive discussions were k l d at t k nc adlB p a r t l - cularly of the %ti-l *parmat: iP4tl;dsaea~im): cbese helped 98mt??%agg, to arfetat a % m f i m s of tk X I n the e m l y p b s e of the s t d y tLe c &search m LciTransport Bli05sf- ef 81 $m prew5r9ed ss~gievai shti~~acefor 82 101% per%& Fn tiae -%yses af tlw steel and hiwag. projects, Later, the Erergy Division of Planeasion, beaded by Dr. E&ardo Bamra, wade a very substantial contrihtion, mer several zaonths, 2n connection with Is used for the evaluatlon; a h s t a l l the Ls operaticma1 as -11 as the actual applications were carried out by this Division, and the assistance provfded is very rmh appreciated, Du w the course of the study cmtact was made with many parts of r the alorplbi- W e ittations kn She private sector. tien ~f tbe projects supported by the Bank. mC),Eapresas , and the exten-  Universidad de 10s Andes, Pacultad de Ingenieria, h g o t a : "Znvestsents i n Infrastructure and tbeir Re1atfonsbip with the Socio-economic l o p e n t of a h i c 5 p i o : the case of Socorro, Samtander,'" T he studies proved h e l p h l , mt only in analyzing various mlcroecanolaic apestions about the e f f e c t s 0% projects but a l s o aia illustratiag, f o r the specLffe areas st;udied, t h e sodo-e c develownk accomplished i n Gc~l*ia over the last twenty years, Tfaroua- tbe study, bat especbally &n its earliest stages, much l e i q suggestions were made, ~ L hP d c~Ek~ierIt@d ~5th so Fawblla, the Be~llb's P iotLetotatrcan, and he and staff of the 5- Ewalu9t;lrgnn Diwision am3 5ts s%&a in the full responsb- Bflirg fer tb j d reitch& rests with t k Wricrafcteu9 Ealwtfoa Dfvtsiem, r C s l d i a slsd its d m 1 4% f eralhtliion 0% t8ke d w e ses of that: fn seater derail with &be Po1lrs sincerely, Christ-er B. 1Wfllts~bby Ghbef, *rations Eval;llatfon Division Progrm%mg& R u d g e t b ~Department  Page No. List of Abbreviations an4 Acronyms xvl. &l-bia: Foreign m b n g e Rates xvf 55. W~raphj and Besources T k e e Periods of Bstory 6r-h and Change in f a at dameat PaticZp;itfrars in tRe melap- nt E f E ~ r t stratTacm a d Brgafeatiorn lfscaP Perfa- nee &laace of P a m a r s T k Mideagq S e w s f B a d Act5eaa OE tfze % &'s Effwtfve~ew The Wvelownr 1PTojects Sapprted by the aIsk tic mearree &welomat Partisimtion in t b Wvef iffart istradisn a d Organnizazfsn Constraints Ba& bLssis5anee Starem Tbe Transport Sector Goldfa's Trampart Sector Since 1450 axzd IBarrk Partic5paricn  xi. Page No. Mgfiways The Atlantic Wailroad Railway RehabiPitation Program t: on Hational Integration ions ations . IV The Pwer Sector all Paver Ikvelopntent 1950-7-0 % B W Policy M d c e and Project Selection Project Execution E" ial Per ce s CBEW~S%C eS &nclusioas Be l c tions I . The P a d e l Ria Steel Wlll The Fiwnc'eras as Ffrurneiaf Iastitratiom Urilizatfon sf P a d s Relative Prices af Eahx a d Capital Go.llclusi~ The Agricultural Sector and the Bank, 5949-70 The Livestock Developeazt Pnisject (Loan 44.8-CX3)  Page No. Arlaatico Irrigation and Land ReclamatZon Project m an 582-COd Agricultare Credit for Bsddle- size Fa - (Loan 624-tD) ConcPmsiom mII. Social Ilafrastruetrase Progects mucation Water Supply HbubP5c Pkaalt?tn f?~5lway Q-1 Other B ~ J HnstitiuQiomTn the 19551Bs f b e Winf.stw sf h b l i c Works Two Rew Urilfhy Imtitaaefoas %n the Z9@s Wgota Water C - a q Qebser New 'fbomorers fo Ithe 1960s rnnehwioars m l d i a : First mg-y Plan: Ilrigi-1 md .Actual Gowerage a d Costs E ar Roads Fiaanced w2th 4 3 - a , 84-a, lW-ai a d 295-W Goldfa: Ecomb.c Betmn of s F f m n c d with 295-8[3 I s t e r m 3 Ute of Reurn sf the Atlamis. P%aflrod Bag dell R5o 1963 m a w . i i s n Proget: Costs a d tmctioat Schdules, fPorecwt a d klittwal E s t W t d PinancSw of I d u s t r i a l Emsmlzt i n ColbLaa3ia, CYs 1963-649 @apIar;~ibfaniC~macimes Pinaaelilejras: G r m l P and Pergo e Idkcators Sector81 DZstriht2rra of SBElkl Credit 'k5nes @-ftted and Disbmsed, Total Lams Disbursed by Cbqmoracbones Fi- nsncieras a d HatironaP Pnves-nt in IManznfactwiq Structure of -31daian Modern Manu- facturing Industry, by Size of Establisbenr 1968, and B R D Lending ll967-69  Page No. 7 .1 Production a d Prices 05 Hajor Crops, 1950-70 7 .2 - AtZantico Project Dry Farmtag -- h e x Tables .P 1 &lma%a: Wram9.c & ~ e l Statistfcs 195Q-1970 1 .2 artson cf Tea-Hear General ,1962 P m W s s f m gtlergan- atfms a d kt-l W ~ ~ e l q - rent 2 M - 1 . 13 antral W 1 .4 Meerektt 1 .5 -5mbPa: %I-e of P a p n t s 1950-19;W9 1-45 Df sbrersmemts on Foreign Loans aaranterrd by & l a b i a n Co.rpe-rn5: 1 .7 &lmbSa: Foreign Exch-e Rates 2.2 a1mb.ia and the EBED: 5 Y GbromoP~ LW-1959 sultatftre Group: S ologg l%O-1970 2.3 IBUJfM Loan d 6red5e 2.4 XBWJIHIA Laan D Z s b m s ~ n t s 3.1 CololratEsia: E g b a y a d EC9iIway Projects Bu2ls: under Bank Lams 3.2 ColrPrPlbia: Passeager TraZficand Freighe Trafff c Foll~ng Page No.  LIST OF ABBBEVLATIUNS AWE ACRCNBIS - antral fg'droeiectriea de9 B f s %camLrda. - Qo - a t & Acwrdiancts y Wager d Sewer .ilia& de Bogota 3 - mmsm -&c%pales de r6al2, (Calf finfcipa1 Enterprises) - wws mblfem m&llf;m [m&llfa Public Services) & - Ensrftuto Isi@anal F-nts & Micipal Emtirote far BnScipaB M?velo (GoPdian  xvii . ISA - 1ntercorsexi.o~ Eleetrilca S,A, Lebrija - Central B5droe'lectrica de1 Rio Ubrfja PIP - Private Enwestmeat Fund US AID - U.S, Agency for Intermctimal W v e l i ~ ~ n l t CQIDMBIA: Foreign Exchange Rates Av. for b @ q U.S. Dollars fn GoPcAbga %a  If development is legsmed by G W increase C o l d i a has developed noderately over the past Cventy years. If it is measured by expansfon of: opportunities to its population Colodbia bas deweloped modestly. If it i s measwed by reduction of poperty ColoPbia bas developed marginally, if at a l l . As an intraktion to our imalys;ts of the %n k's contribution, this chapter deliueates the deve t that has occurred a d seeks to identify and aaalyze the seriom obstacles that hawe been e ~ ~ f ~ m t e r e d . both Atlantic a d ic %n 1889, after constnrction slides. as a nuder of towns w i t h atter enters with distinctive features and s ta, 8,500 f e e t up llin at 4,500 f e e t citg of t?ae b e r t i l e Wal2q; W ~ ~ L P B at a , sea Level and the A t h ~ ~ t .icc~ . a o u r l --; as well as a number of ry ~ ( 5 ~ t e Z sm,&i as h-m-, &n5zafesS Powyam devaluation i n December 1%2, with a less devalued r a t e for coffee, thereby generating f i s c a l rescmrces. Further necessary cax measures were delayed, partly because Valensia did not have tho two-thirds najarity i n the House needed r tbe Matioral Froat system, and inflatfon proceeded a t a rapid pace, stirsulated by wage legislation promoted by the Gave-t early i n 1963. Fiscal revenues, in real tenrs, never reaebed mear the level recpared t o support the General umnrres; a d rose sharply i n 1%. Within e s&taation'had again rapid lfberalfertion of isports and poor perfonmpce sf findaor exports. R e s i d e n t Cu brd to take drastic laastlres, rate was inero- Tax revenues promotedo e stro~gly st rate mad Wif r a t fsrnalized, important s t r a t i v e refoms Despite these polikdczl difficatleies a d tb e on -ti- is t k t d o l a a l ~ b f amrlric9, k bat rtheless a& amaverage grawth, inreal tern, of4. Wr so thst GI @ i~ now lore Usga ancl a d a b l f times the level atta in 1950. This is a b u t atrerage amng Latin American couarries loping countries as a d e l e , but a l i t t l e bellow the average for a& owglaies Js C 9 i d b s s GBP per capita r -e -- arat aroUFd USS3.QO. It is probably abcme any rate of gfawda pl.eviewly achieved i n Colombia - If In regard to a l l lacrae Table 1.1, ehe end of this volume. It should be atphasized thiat the Mational cansistenr, leave a g u d deal to be desired Acccsaats, whil e i n t e ~ t l y in certain respects. over such a long period. RQ~:does it scm &at Government %argets for a +E'gr have been serious e t q o r a r l l y in the early 1%0s. In t k early 1958s tfae GQ s% P l a d n g Office calked of a target of about 4Z and this was & . T he 1961 General Develop- t Plan, Cololdbia's first larzniag effort, mrgeted for the first kalf of the decade a d possibly higher If. Ac-l growth awesaged 4.4% in %he firs& half of 2Tj: ower the whole ten pars. Better h n 6,0% growth was achieved ig f 968-1978, re acceleration in agr%cul-a and idustry and a considerably st r balance of " is, and gmwlth f n tbe realm of 7.0-8.0% was be%= targeted for f o c t h c d ~ years. (5.e. a1 l -w for changes i n the terns of trade iiad therefore r-reserntscrg real p ~ ~ ~ d t a s ipower ng 0.f the due cto a declline mi& =re rapidly m e t the a d im~s-mt BOL)M than ~ffsetby 9ee fnPlw sf foreign a d 1~tcr&30bomfgrants a d IOPLW. CZr l mh en t 2Ws lover rate of finvest- haft actrrel base years. tern e w c t d bas be lase years sf thre d-de; fesk;ei@ass%sa- fn the larfd-lrnrr CO d &ereafter. T&I Z fete%* assisa- b s t3-) a d because h ! awe h e n very dfsap- ob @tee m v w s by 1970,,uhea tihey r w c W t k Ievel of tlne early 1950~1,they were reas asrt to projested levels, but private s a e ~ r g shave gram little d t h the doubling expeewd aver the plan perid- orison between the Plan, the B nddeiotw on e 1.2.  Since P9H the structmre of prodwtlsim has ~'.aCtedout of agriwl % w e into 88awfacttniq a d serPices, dgricuPture EK~W accomts th 4QZ h 1958, the reductions in wars %w GgICb"Bfl$b -8 a d atr-ex - te a&@= =re d1..pnersifiedthan twenty t%cutlnrBy 5n the sense of an 2 ~ - eZn p?r a t p i t a %fltc- rswmgw 3.55% at faster k a t . last Bew years ~ 5 t han Tre~agsratfma d mpqm bttfe&s e matPg *wiJ, The country has m u rauch greater resources of trained people and a considerably more effective s y s t a of public administration. Foreign debt 2robl- have been successfully avoided since the l a t e 1950s by carehl control of foreign borrowing. Foreign exchange resources are eov better managed and a r e less of a consCraint than i n some years i n the past. Fiscal performance has isproved considerably and t h e public sector is oaw a stronger instrument t o promote balanced development. The pace and pattern of eco1wm.2~ growth have nevertheless been such as t o provide increasinp, opportunities only t o a rather limjlted proportion of the population,and :in some respects that proportion bas fallen. Unemqloy8ent and undereaq;loyment have greatly increased, The f r u i t s of growth have been very unevenly distributed, It is hard not t o ke struck by the accuracy f o r the last two decades of the description of the C o l d i a n s i t u a t i o n contained in the Bank% f i r s t major report on the country, in 1950: c progress of d.le past 20 o r 38 years, however, while very real, has been quite uneven. X great deal remagns t o be done, and t h r e a r e many aspects of the s i t u a t i o n t h a t give thoughtful Colorebians pawe w ncezro. The darker side of the picture t e n t e r s a b u t She condition of fiae masses of the people. The great mjartty a r e inadequately fed, clothed and housed. Their health is poor and l i f e expectancy short. A large proportion is il'literate,azrd few have had morg than two o r three years of pr5mar-y schooling. Taaegr coadit?Eon i s b e t t e r , no doubt, than t h a t of the people i n many underdeveloped coun- tries, particularly in the 9rpuatorhl belt. But their standard of l i f e is far below rhe level that it csuld a t t a i n if the country's p o t e n t i a l i t i e s were =ore adequately real5zed." 1 1 In s - of the areas nrent%oned -- such as primary schooling and l i f e expectancy -- bps-nts have certainly k e n made a d the numbers would be d i f f e r e n t today, even though the broad statepotrnts remain t r u e , But i n s~ipe areas there has been e i t h e r ao improvement o r a deterioration -- i n particular f n m t r i c i o n and h m s i q . The biggest problem i n C o l d i a , to which every major Beak report on the country has pointed, Itas been and remains wfdespread, and i n places desperate, poverty i n the countryside. It d i r e c t l y a f f e c t s between a quarter and a t h i r d of i f h b natfonal populatim, despil:e the - I/ IBRT), -Basis of a Developaseat lrogram for Colombia; - Sunmar)! (Washington, D.C., 1950), p. 2. large dgration into the towns that has taken place. This group accounts for a major part of the bottom half of ' earners i n Colotpia, d i c h oray well receive a ssaaller share ioml income than i n almost any other country -- i n I964 oaly 13.5%. hpressions and numbers a l l corrsbine to suggest that, although a l i t t l e progress laas been d e , thfs rural group bave beem b e d - worse o -- respects i n busing a x& nutrition absolutely a d i n relatively. They probably hawe the highest b i r t h r a t e a d fie Pic health condi- tions. rSearly half the b u s e s in r u r a l area d wfth l e s s than a quarter i n 1950) have three or mre persons per , Probably some 1dwellings remain withour a q sadtary facility (latrine) 1 95 0. E n r o h n t h school sf children of pr-q in~~eaae d brm 20% " i 1950 ~ to about $035 currently, but ualy a - 11 fraction of these go through a l l primary grades. 'Phe a g r h z l t u r a l laborer, tihe Bargeat sktgle grmp i n the natioaal Labur force (abut 2tZ of the tetal) did participate in e a n d c %rarth, w i t h r e a l wages imcreaslag from 3-D: over $180 a year i n 1945 to about $250 1 1 i n the early 19643~~ or by -zly 4 a . But since lthe early 1960s agricultmal wages have i a c r e a d i n r e a l tern. A t the s m the, average ia W* of the national. labor f o r e has d d l e d s h e '1945 a d =wfacrurio%g, wages have amre than doubled. t, whi& was mot a major difEfiiculty i n the early 1950-, be 1 - i n the 1950~3, The 1961 Plan aimed at m iacrease of two e p i n t s i n the rather l o w Labor force partickpa ti- rate 2f uction i n p9.cPcfaactidty different;isrls n 9et-rs, a e s e a q e t s were geared t that o the a s s ~ ~ g ? t i o n 9 1970). Qtkrs t u d i e s cotjrer - 44 deelopi% comar-ries give e s t h t e s for the &are of nat%-l . irece5ved by the poorest = - of the population: &'lo;sJbb 25,9%, Brazil 22.7Z, M e l t i e ~21.=, Venezuela 3tR, &sea Uca 25.4%. The figure for r@r> % a is lower than for any o&er cc~urrtryam= the 44 except Cabon <85,=) and Lkbya (1.8%). s -- - 2/ Both figures i n 1969 US dollars converted a t o f f i c i a l exchange rate. - 3/ 5.e. r a t i o of labor force t o Sofa1 popuktion. populatioa was growing a t 2.89. p.a. I n fact, as has occurred repeaeedly since 1950, the actual pace of population growth great- l y outstripped the projection: i t has averaged 3.3% p.a. and 1970 population was probably about 3 million above the number expected. The 1970 labor force, i n absolute tern, was nevertheless below the nm- ber projected, reflecting a decline instead of the targeted increase i n the participation rate. Open lopaent increased substantial l y from soltre 5% of the labor force i n t o a peak above l a i n 1967 since when it has probably come daM to a level between 8 a & la. Productivity differentials have a o t declined, but s eem t increased, between agriculture and aon-agriculture, and, =re tly, between sub- sectors i n mu-agriculture: , the bulk of the increases in employment i n manufacturing a betwegn 1964 a d 1970, by con- t r a s t with e a r l i e r periods, s been i n the law-productivity 'traditional* portions of the tber than i n the 'nuadern' por- tions. 'Ehe poverty of those engaged i n 'traditional' l o w productivity occupations is i n mny respects a more serious social problem than out- right l q n m ~ t ,affecting many more le . The main beneficiaries of the dewlo achieved a r e those who f a l l within the t o 20% of income recci- account for some 69-70% of t o m ioeor. d other than those owning very mf. p u p muld inc st property-holders, 2/ 1 farms, a d =st of those working f n the nodern sectors of the ec , SU& as "ern-acturiag a d COQP~~C~ C, o o e m t , ffnarrc r w i c e s and public u t i l i t i e s ; the modern skilled and s e d - s k i l l e d warking class which has begun t o develop over the l a s t twenty years aad tbe technically oriented Pfddle class that has emerged would f a l l fa t h i s group. About 2036 of the national labor force is aow covered by social security, d w i t h a b u t 6% i n 1950; and about the labor force s aw pay i ax, with 2% i n 1950. These l i e s would account for ao the s school enroltent, which has ipcreasea frola about 67. of r;lue population i n the relevant age-group to nearly 2CX by 1970 (about half of the enrolment s t i l l being i n private secondary schools). Host of these principal beneficiaries of deve n t l i v e i n the larger c i t i e s , but there has bean rable ation out of the r u r a l areas and doubtless those vh into the c i t y have also participated t o so= extent i n the benefits of the country's develo-nt; - I/ The top % incolae .! of incase teceiwers account for about 35-40% of total - 2/ It i s roughly e s t h t e d that the wealthiest la of fanzilies own some 75-9OZ of a l l wealth i n the country, chere i s same evidence that, anyway up to 1965, the average income of the poorer half of the urban population increased slightly more than the national average. Since 1950 scme four a i l l i o n people have migrated t o towns and c i t i e s (especially the larger ones) so that these areas wrw contain nearly 60% of the population, o r 14 raillion people campared w i t h less than 4.5 a i l l i o n i n 1950. Even with t h i s extremely rapid growth, public and private f a c i l i t i e s have been d fast enough to enable sop 60-752 of urban families t o send children to f u l l priParg school, to have t h e i r am sanitary f a c i l i t i e s a d t o have electricity, a s colparea with . Wonetheless urban crawling has also become rore s r t i u a of f d l i e s living with three or m e persons to a -re than doubled, but remining rucb less tbsn in the n u a l areas, I b could a better pace a d pattern of been achieved? Hov could a wider developlent have been ac reasing oppor- -ties r o r e for a greater proportior? o There seem to us t o be five b y issues which a r e c l o inadequate robilization aad exp1oitat"ion l i m i t e d tfw development e f f o r t and it prevented the Gooenvent e c- in map years. ntse tendency for t i n the 1960s tban p I a d on foreign re l e s s than glaataed local resources of ruas deep i n f i c u l t i e s of bringing s t i c resaurces of mirealized potentials at and savings: for instance, the for Coloaibfg t o be- t b io pient of nutrition assistance d e r the World F d Program despite i t s rich and dioersified agriculsural pntductioa potential; the failure of many particular agricultural exports and t-substitutes such a s rice, wml, h i t s , vegetables, flowers cao, t o develop to the extent that l i g h t have been, and was, expected; the over- a l l grovth of agricultural produc only equal to population ; the disappointiug development to date of the ccnmtry's rich resources; the slw progress i n exploration a d exploitation of linerrri resources; the odd pattern whereby electricity, probably the rost impart- a d capital-intensive urban f a c i l i t y , seiena t o bave developed m e i n the uajor c i t i e s than a h s t any other major f a c i l i t y , such a s bousiag, water supply or ptlblfc bealtb, a l l of which should be less bouad by import corutrafnta. s t i c resources 11- i ~ ~ in i l appro- t tkie structure of laad in thc rural areas. Tra- and rather Lncf f i c serwices, guara i d t e d Larerest and t k y m y pe as because tbat lack of f h a c i a l resources,  &disaibution of good l a d i n large quantity seems to us essen- t h i s bottle=&, but the agency s e t up 5n 1961 taking m e r l a eqmtely exploited, w i t h corn- pensation to the -- r laas mot been able to operate effectively, Nost of its ePforto b e been divereed into silve irrigation and coloniza- tion schegges mt cormistent w i t b the sc f C be problest or ~ 5 t h @loadb2ass f i m c h l resources;. Aetualpr.cel%zation of land expro- priated or a c p s apparently yielded no more t h aboatt Q,W of thas l a d has allegedly beem of m s b l h r s because i t Id be ~ r u f f ~ b l e&welop at. Pr%ceincentives and the threat of laad refs- k ve fduced same reductioa in the amount saE land held i n the l a r e s t Barn, as i l X f k ~ m a Mby cadastral survey figures available fax selected areas %n1960 and 1970, h a t a t b m w e n t has been small. aearly 2 , m , W Sam f a d l f e s w f t b less than &he five hec- By requirefea to pmHde a b a s k r%Ita&rd of l i f e ; and even ctvedat pqaazcll for the smaller fanrceers b~~uches less ~ B 4@L , m 0s t h m . Wider: eqlofat8rraw sf stfc res~atces bas also been hampered by selktuct~ralprmitrliw im c mrkes, wbbch I h i t the generation of crdiO: ratlaer rkl w g i l m aP31y a?ggbWole d also seem t o s WeBaapn~ttfimme Lnshfht5mrs [ F & m r ~ r i e r a%naves ar38srzn -&hec m t q , net c ti;a?lg w%th one am"rher =ch, but rather a s a ma- 1-1 grows &-9n a~g~es Bs avi2rgou~s p c i a l credia. Bf'tpgs amflardble E T &C ~ matrak h l a g f , eaeb with thekr l o ~ n reg-skatd iate3tasl cture, U w - t e m bram6.q 4s difficullt due t o the 5sxf lati-- mPr t a d stioek m r b t 0petatl~3(ns are ii&;kb;k*d by the c m r ~ ~ n t m t f of ~ni it;k ivrfitanee of forred %nwestmla&s for S i m w b E iwtLtu'l;.Esms a d legal u=eraiat;ie$. The ililrebr side of the co%n08 &He p r o b l l ~ aa b B a i q i w domestic rewurczsls into m e for d m e B o p n t 5% the pmbEm of secmfng partfcfpation im the d e t ~ ~ e l e p meffrtsat. t: E~mslan OZ e ial Barn prductioa has m t -=rated v e q sfxeable ts of aq It: atad it: has scsetfdltes 'beem a t &he cost of ttre -El f a m r , pushiask: h5.m fwreher fnto subsistence productim -- dae t o the 1 - im - Zewels a d Pow effective d@mnd of m cIh sf me wpalarZon, a d c a m t r w n t l w n;leioml elastbcity s f demand for agricultlrral products. ?Rrs concentrated pattern of 2-ncoz.e dis- tribution has severely P W t e d the dmestgc market Ear kdnstrisl products too. Apart 4:k p s d a c t i o n for expmrt that has developecl trial dewelo bas ken largely a self- sufficient -prducti@n ss geared to the needs and 5- ts %atransport and c tgons, ~ 4 ) the $ra~r-i= size a d c w t x 2 Q 0% the ecaow d 3.aqmived -- d s r c a t i ~ n bas so far mainly a f g c t d t k s e classes tw. log28ent, reasses-~1t s f &e 196% Plan suggests fnwstrrsclrat rates prcap& bad been attained, =df= pducti.crity sectors would of UrgetS -- W Z & ~ S B S ~ C & % PttE2iSlzreS hs, %=r-.slal f m s m n t bas tended katge f L m 2 M .~;rl89loyees% and (*= 10 he 3 with BSgk capital- e9p%;ka2are k f m g & t ; a w d isa &%- - sgtcer i a di a ratrm ( S - S W -lames) a & -81-she f a- <5-PO hectares) bw suffered sewerel rhge of credit, tecknIa1 e , eec, As a acemlt cWw jobs between 1958 ~s$1'5,m-2O,om @%at&- r@h-s at: BSS$,W equdvillene, But l5y be- s b l e te 9aJwest m a ~ t a g eof o .sl Pgr about i ~ 3 , quit.a~eat m per m job r r a t d , 1 1 a i r f i ~ .includes c kasllsf-, rehtzct4 i d % a ~ t : m ~ U iaPaj[%x,e?ct&g re~ etc, An asdcqaee mZutgea Id hawe re.$rrfrd grcazer efbere% to srre~eka a d fostez -11 kdet%treg.a d ro~zsercterciod3, by e'bzaae'blf~ =re crdSa; EO chm, awl 1 I . P dreg03tma by wrcelf%w :or whkh D C m a s t m t a s &be gnfrasmwture knves2psse.da.t:ieo%Sr per Iy settled at rat ewn wi& m a s ~ a s of this =tarre and rapid grm& of the ac ,the am-1 iarves-mz %fed mer the period 'Bsla-18aS9 co sai partfck3patiotl a d q% t rates at &efr levels ab e k early 1%@3 wtpld hawe been a h t a38256 ailXfsn eqafmdent amre tbrr a t was acttmlly a&ert;ahen. Bdrs f iwre fs equivalent: to s m e . - fP 2.e. net d m s t 6 c in.stesmnt d g ~ i d e dby BncTease 511 - l o p a & , w i t h f-ares l a a d one year so *at: 6ack.easar in - 1 t 19M-'6970is red w?ior%l imes-nt 1%-1%9 inclusive, 25-3OZ of cosrbined pmblic and private WtiSa~tions, PrSvate ie3n tae paan, ibeut it 83, *ly&ng the 38e~sm-es - zp mas %s fadirtraa by the dSotrfbut90~1tn a l s r r b h , era f rtY- r 5 a of f.escljlIfe9 than Sts 1950, a& least ff dbtr%htJ,mhas ceded to en I953 d the t k deeerioratfm areas were at the saae t h grewt.llp; =eh Easter f n a t e r m s of out 0% every 1,W of t3e populat2on presently crossing the age of 3 arz~dare conseqmently "izxagable of d 5 f y - f - &e social s d i f g th-elves, due to the ixertfa of zits sE C o l d 5 a have taken to hatjlen prticipetim 5n the dewels-nt effort are 4 5 a d agencies such as; INCGU, 1, par%lgas efpe result of cum- Su& csre~i~ati@m ha= response to tP--dmmamds of the poor, bat t k y also hawe beep am ratant st-las EO t h s e deminds. Go= t Pa, -1-ia bsas not been able to v i a the sLtw1t5on. 2 e s e awcbes have h a cmkmt* the bas%& p:obIem ob svercdng apaIt;hdp, c h ~ & ~ e ld lliq s~tfsfactima d fdapcgza;$ r e s ~ l o n a ~ w e ~ s s . and executiw policy, The agenc2es and organs of the Government tend t o love sharply up and d m i n effectiveness degeadiag on the strength of a few key appointees, the support which they are given by the Gavennm~t a d the extent t o which ehey allow partisan p o l i t i c s to iattude in 4he operatian of their agencks. Partly to lhit pol3tical interference a d partly to meet the needs of special i n t e r e s t groups there has been a ndous growth over the last 30 years of so-called 'bcemtralized agencfes', not generally regional t comtitutiops, t h e i r ova 1968. "Ihe lJatioa91 f i s c a l d fore%@ex- l i s i~ n 8964 a d it k e n c i e r re i b l e far prepcarat&m a d execution projects a d for sLoa of esr.epti.al ~ertricesa m the -- as transport f a c i l i t i e s , water ruch lore usw- gattern Cemxally, t h s e responsible for bo ther a d offer time. %nt.he r u r a l areas a d m a t l e r tams to haw streag l i c i e s a d tra structures, which are aqqmy substantially Belcw those in private enterprises, have sametires been seriously eroded by 5nflation which has added to the difficulty of retainbg good staff. Nevertheless these agencies, as a group, w e r e able to prepare and execute, i n the late 19608, developlent projects vitb a totaP cost three or four t.Lmes the cost of those d e r t a k e n i n the early 1950s, which i s a significant achiewement. Fiscal Performmca The vgalaress of central Gent agencies is in part both cause and result of difffculty in collecting t a x e s . Shortage af resources in the public sector bas been an lidtw what could be achieved, lcnt projects d totally p m t f e g r j o r e e u r r e ~ tr s, which account: , f1uctwted between 6 a d 8 per- l e r tlw early 1958s they rose and rapid industrial devalogmrent. bably t3m aost less, after a l l the efforts, total r fiutat) nrah law %n (Tolorb%a,at a h 11 For dketafl, see . - a s gur other -trier are not available, repiems as a percetat of G%IP were: Brasi.1 21.4%, Chile 20.W., Ecu8chir . (I, A. Bhsgr:ave a d H. Gillbs, 1, 19713 bEalb,iw to perso-1 Bmc-s, the tom1 tax burden ranges between 92- 14% f m tke lawest ten pertcent of into- .ar9ce?iversand only about 20-22Z Ear t k t a p *a percent. a saidaa111y rislng trend over the last apliea rncrease of expadliture on edaeaf5on, ice $as fallen. h b l f c invest- at remnws, increasing from 2-3 prceaat of W P fa the early 19SOs to 5-6 percent of GDP fn the :ate 1%@s a d m p : 6 prcetat %n 2970, Forefga assfsIt;ance bas covered about b l f a~if thf$3 3wrme. cos scarce t & oat m ost of the per Cod By hawe h e apprqrhte to r use for planning esst of pu%BSc m s m r c e s %m excess of one, but sm web %%giaare a p p r s aws E o bare bea a l c a h t d . As regards the @prmlQ -st sf apbmlb, b b publfc a d pa.%wat&, e t lan appropriate & Sl -8 E ar @fie *rid d e 3 rwZw appmes it8 k a-t 10-BIZI wBth a l~gaarsfblcr a w %gf 8-1s. ICQik&Sass ~ O S C ~ =esfcbage sfmtgan e b a e d sharply s n 1957 i am ef relarim lgcaalaa to a m ersa ~hormge,exacerbated by the steady dclelim %a wrld eigffee priws frm 89% tgp 1963 and by the need to off the large &marsBuLiZa q h-ioraa 19151. and 1957; not untll &e late 19Ws did Bkbift! f6rcte cxckaqe sltmtfan regain some degree of atabilfty a d i a a 1969 tau1 mriebdise ewrk: eam?in%;s Sot the f i r s t @meed&the Hewel tea&& at the end of the e@f%ee in 1956. 21 Pot dea;i~%ls see ~ W Table I 1.4, D%str81&l;ttfmoi f Ha&%-1 Gave @891wAb. 8950-14167, % m r d Dm, BS7B. Fat demils sf the e~~atsicts~p of ar b l a m e of papntsr, see Annex r Eva-before 2957, h t to a much greater extent afterward, i t was necessary eo for foreign e e by nrarnerous rt prohgbitiions, sits for fxqmrts and sonretinaes prior s too, Lieenstmg had to be pahtfcularly 1957 fisaocial ctfsis and in the early d d M l e 11960s vhm rap;,d inbPat5m ed to put stress on the batan- the existiag array of controls and m these pergods or" tightness s I ts a d inter- . Corasunaer inwes#merit exceeded hter-  Balance 05 p a p e a t s evolution has nevertheless been somewhat disappointing by c o q a r i s o n with 1961 Plan objectives, and minor exports a l s o Eailed t o reach the 1970 target of DS$300 million esta- blished by t h e Carlos LLeras Government. Over the long tern, a s discussed before, the main disappointment has been the poor development of many natural resource *xprt potentials, Tiis development 'lagged p a r t l y due to the unstable fore%- exchange regime which prevailed and frequently avervalued exchange r a t e s , but mainly for s t r u c t u r a l and -- i n s t i t u t i o n a l reasons ou ed land tenure pattern, poor Govern- s e n t orgian3zation, insufficient: surveys, lim-ited industrial r e q e t i t i o n and enterprise. The e x c b q e zare $as frequently been overvalued -- i n the immediate seslse the it led to exchange crises, i n etrie s b r s - r u n sense that it had ted by m e r o w other measures t o contain the demand nge, a d Sn khe long-run sense that it <together liith ck &ereof) resalted in partems of demand and of mxib l e s s h L l use of d-stic resources f o r devr?fomrst: t b l m s k u l d have bee= possible. A spe?c%al study t o estimate the prlico a t *ich f o r e m e'9zchange w3I.d haw 'had t o be sold each year i n order t o egaaate d m d - d t h supply without reliance on t a r i f f s , p r 5 u ~ d e p s i t s , -;atbrat&ve restrfctiow, etc, suggested that t h i s would have bee= k ~ a 1.5 a and 2-3 k rA - e o f f i e h l pr%ee each year s5nc;e 1957 a d generct ly less beEore x Tabh 1.7). Simailar r e s u l t s sere reached by the & l d l a l a Batioaal PPann5ng &pzr&aerst, & M y because &ese results are h s e d an mr-*-ymr anaXyses, without allmanee for the e f f e c t .that act.c-3lslblycharging s d grfces would have had on the s t m c t u r e of the ec , they pr0k38bly emggearslee the real scarcity price af foreign sxcbn5~eaver &c E aw tern, On the basis of our analyses it w a l l $ seem ctcsdtftp1 *ether the 4 a p ~ r t u nty f cost of !foreign rrxch=e en Wl&ira a t tie end of Cbe 1%Os was a s meh as double the o f f i c i a l rate but: fk wmld seem likely i hitawe k e n a t l e a s t 1.5 t h s the offic-hial rate, By the l e d of the 1950s mest wrc90andise imports t o the p r g w i t e sector d i d i n f a c t pay a substantial p a d m aver tke o f f i c i a l rate lira the f o m of fmprt tat58f s and prior deposits, so -that the eiffective ra r them m t 'have been very w c h below the 1.5 Level; mrcbadise ts to the public sector a d basic idzstries and imports of services were hoipever s t i l l priced a t a low effect9ve r a t e , very close ts tkr o f f i c i a l one,  h o n g developing countries Colmbia was one of the e a r l i e s t and has always been one of the l a r g e s t borrowers f r w the Warld Bank. The f i r s t loan was made i n 1949 and further loans have been made each year since, except f o r 1957 a d 1965. By the end of 1970 a t o t a l of 43 loans had been =de, mountis~gt o US$756) m%llion, of which US$33Q million was Eram the IBRI) and USS2Q million frm I DA. Five of these loans have been f u l l y repaid. Colmbia's outstanding debt t o che IBRD a t tine end of 1970 (including undisbarrsed) aaaouarted t o US$528 million or j u s t over 5% of the t o t a l IBRD portfolio, more "tn any other country except Mexico, Brazil, Japan and India. Pn per capita terms Colmofa has been the l a r g e s t re- cipient of IBRD loans amoqg major developing couatries; by the end of 1970 i t bad recei-ged US334 i n tments, compared with US$l9 for Nex- Zco, f o r example, QS$9 f o r Brazfl and muck l e s s for India. Although l e d % = began i n 1949 -st of the Bank's been i n t h e 1960s, and nearly half of the e m u l a t i v e tote1 lin the f i v e gears 1965-l97bP. Hew lewd%% averaged US$15 .nniIlisn per year i n the 1958s, but IgSS6O a i l l f o n i n t h e 1960s a s a wlhole and US598 Pgallion in the 'last three years. Gross disbursrenenrs ran a b u t US$l33 mi'llion an- awllg in the 1450s b e US$35 m%3Llion i n the PShljOs, Bbsaetheless, rel- a t i v e t5 t o t a l foreZgn lending t o CQlcmb1i4, the 98& has been much l e s s i a p r t a n t i n t h e l%Os than i n the 195r63, Leaving aside the special medim-terns c r e d i t s obtained a f t e r t h e 31957 financial crisgs, the Bank accoafnred f o r well over 5@% sf 911 mdfm a & long re- Pending t o the c o a n t q bemeen 1949 a d l%0; the only otiher b p o r t a n t foreign lender was the US E x f : ~ Bnk. But far the perfod 150161-1970 the Bank and IDA ac- counked f o r only slighkfy m t e than a quarter sf the US$2,P b i l l i o n t o t a l loans obtained frm o f f i c i a l sources, Two-fifths d i r e c t l y from the United S t a t e s (though AID, ExIm Bank and PL @ 8 ) , one-f i f t h £ran the IPB and the r a a i n i n g 15% from t h e Europan countries, Canada a d fapan. How- ever, eve;: i n t h i s period, the %& b s r a i n e d the most %mportant single source of foreign fiwnrje and, a s C;hrrimn of ehe Consultative Group &ich i t established f o r C o l d f a i n 1963 and t o which these other coun- tries and agencies belong, it has taken a lead I n encouraghg t h m t o sup- port the Col.+ia;z developent e f f o r t . In addition t o loan finance and coordination of f o r e ~ g n assistance e f f o r t s , the Bank has a l s o provided Colombia considerable technical. a s s i s t - ance, i n the form of major ~ t i s s i o n s v i s P t i x g t h e cefilntsy and reporting, a s w e l l as resddent advisors. It has devoted substantial &fort to strength- ening institutions to which it has lent. A-nd it has offered considerable advice abut developsent poliey and negotfated poliey agreements i~ con- nection w i t h Consultative Group lending operations. The purpose of the present chapter is to analyze the Bank Group's overall contribution to Colmbian developzient, particularly in relation to the five critical is- sues discussed -in the first chapter, and co identify its strengths and weaknesses. Tbe Viden5m Srepe of B a d Aetiori The Eank's work with GoPdIa began in the middle of 1948 when the Gal-bian autbrlties r q a r s t e d assistance for a number of tentative pro- j e c t s a d an eeonmic mlssfan vgsited the country for a first review. The B a d decidd that it rould go ahead witfa a lean to finance import of amieultapral equiment a d several possible baaall1 power loans, but that fulYher leding, parsfcularly for certain transport projects proposed by the W f d i a n s , would have to awaLt the outerne of a major planning ef- fort. The B n L srugkgested m large Suweg Hission, whfch it would sponsor, to help the plaaning effort. The eneral S m e y Mission, uder .rhe leadership of Dr. Lauchlin Currie, spent the latter hlf 0% 1 %) ia Colc~nbia. Its extensive and cqrehepasive r e m e , broad in outlrac,k and con2roating a11 the issues klpottans:in tday% develo~'~pt tiabnkiq, was sent to the President of C e l i d i a fn J u l y Ism, It prrrpssed a ncoordil?;zted attack on p~~lrtrty,~' minliy in the form of a public tnwesmntat progrm, wfth related tax mawsures which were also gnteded to encarage rural land owners to in- teas%% vduetisn and to dfscomrage spcuParion in urban real estate. To convert the prom- into a real UBmblan plan D r . Currie suggested creation af a bi-partfssaa ttee fsr W o m i c W's~ePopanextt,composed of frroknbaent Colmbfam. resident rslppofnted such a Committee, which ~rked for abotst a year a t h a secretariat stling of Dr. Cusrie him- self and athrs suaested by the Bank. The ittea played an import- ant p t t in fornularing m51etarg. pslfcy mea in setting up suute new instftutions and pre;parfng revised versfons of tbe r ended transport iwvesment prosslas. But it firmly rejected the pro tax measures d it was ttnable to c on.srilacethe Cov~er-nt not to go ahead with the pro- posed Paz def Rio steel mill. The ttee evmtualfy disintegrated due to tensions between the polfrical pareles.  ttee's work on transport led to the Baak's first two major loans to Colombia -- one in Apzil 1951 for a large h5ghway program and another in August 1952 for the construction of a railroad down the Mag- dalena Valley to 'integrate the country* &y interconnecting the various exiszing railroads and also to ease ecport/iPnprt traffic between central Colm3ia and the Atlantic coast. Both projects ran into serious delays and cost overruns. For the highway progra supplenesatary loans were made in 1953, just after General Eojas Pinilla bad Bee- President, anC again ic 1954. For the railroad a second loan was amde in 8955, to extend the line into a complete li& to the coast and make it the so-called Atlantic %ailroad. Other loam in the mid-BSWs were small follow-vps to earlfer a d for power development in the Caaca Valley. loans for f a m e q u i ~ n t A great d -2 of effort was put into arranging technical assfstance in this period, althougk scme of the resultant assistance was of poor quality and much of lit had only quite lhfted effect, partly due to pol- itical instability ar the Lime, P?annfag advisors were provided to helg set up a ' Planar%% Offfee and prddde p l & s yadvPce- 'ddiwlidualengineers were doud to help tbe P airaiistrp of Public Works with the s"i32d program a d mintemnee. Urge t e- were provided by Mdfgan-mland, an herLca@err- gineering f i m suggest& by the Bank, to assfst the railroad work. Sev- eral misslons were earrlid o w to advhse an establisbent of a regional corporarf om for developlsnenr 0 5 the iCaub=aValley. A major Agricultural Susvey Hission, hleaded by Sir W r b r t Stewart, was a sdeierS&en fn 1955. Other rquests for t eckraaflkn -- l ass1stamce on pubBSe a&iinbstration;1, gov- ermrrt finance, livestock deveHopa31ean&,urban planning, Eor Znstaace -- were turned d m for 1~~frious xeaso~, and consbderable argument was evoked by the B an k' s repeated refusal eo finance water supply expansbon, mislay on the grmgnds that tt muld not hawe the direct effecr on pro- and servfces that it sought for fts projects. Bank duction of $ O C S ~ S sta-ff thmselwesr gave considerable assistance d s drafting basic legfs- s ration -- fox fastance for control of foreign hrrmi=, fox establish- ment of the E JarSo rnal Railways C;orwtstfora (Gm]a d of the regional dev- elopeat carparatlorn for the Cauca Valley (WC], fn face of the deterioratfng f irnafacbal sdtanation and build-up of 5mport arrears in 1 1955 an imwrtant Bank mission was sent, by agreement between the Bank: and the Gowe to help bring order bnto public in- ~ t , wesmewtplansandtoadvisesanthePazdel Rio steel mill, recently cmplet- ed after vast cost overruns but perfoming poorly. The mission itself had ro inventory public investsent plans, fa found them much larger than the resources that I d be available r f t h sound ffnancfal practfces, and s m e of t h e prof ec f dubious f e a s i b i l i t y . The Bank informed the Gov- e r m e n t that it would work on of possible highway and p e r loans p r o ~ d e d that t h e Id take steps t o r e s t r a i n in- uesmenst, IMt other foreign %orr&nag, liquidate import arrears, and expedite eonastranction of tlhe #&Pantie Wllroad. The Government was of- fended, but aa appropriate l e t t e r of response was eventually worked wt between the Finance Hnister and Bank s t a f f . The Bank made its t h i r d b i g b a y Poaa, hat by tbe middle of 1956, h view of the -Oovementls lsck of actiom a d the irreffectiweness of w h a t actPosr was taken, the Bank decided t o s u s p e d f u r t b a lending. Heotfat.$.ons continued sgasmo- d i c a l l y u n t i l the overthrcou of General Rajas 112Eay 1953, but no solu- t i o n s w e r e leaelred, b s i s t a n c e in rrspfaag wfth t?he fimncia% e r f s i s was provided mainly by tbe Ls5 Ex- m a s% r a d tk I W , and k k Bank proceeded slowly with re- suarrikl,g l e d i a g , -rely Ear coslferla a b u t tb cmntry" creditworthiness a& prtly t, ejytreaaely short af resources and hav- fng 3 ,s e%ra ~ l e t g m of on-pfng projects, did not v i s h t o .borrow f a t q c e cmzpgneat of new projects. The &It%; folggglly I f f of Pedbng l a April 8958. A ntnabet of f ~ n e s a 3 d , m%nlyfa and l%O, fet projects; the prin- cipal were for a d Bedell%aWbbch were? begfnning ts s u f f e r y ( ? shmtages t s l m e plrdmd Iediw t o th- had been caught i n t h e 1956 ats%oxl, Pork a l s o pckceedd at rbis t h e on zi-ra6Bon of an ex- o,a project for Paz del Ego, A Bank sabr'rn was assigned t o help the P1a~nfmgOfflee, s e e s t a b l 3 s b d by Presfideab: Afberro Llersrs. A mall m r g e s e y loan was =de to buy tolXalrtr: stock for tho Atlantic Bail- road, Zim1ly nearfag cmp'fetion, kt the breadth of Bank action in sug- part of C o l d i t was smch Sagrrwer f a t b i s p r 2 0 d than i t had been. An k p r t a n t aew p b s e began i n 1 9 51 &en the Bank, wfth the sup- port of t h e Col-biaaa W e r m n t and the Vnited States, decided t o form scme -chinetry to c w r d i m t e i t s e f f o r t s rwirh those of the newly es- tablishedZDBandOSMD akldtaencoudragetheEur~~an~, Gamdians and fogan- ese, i n i t t a l l y s t re'bucranz, t o p r M d e mre financ.ial assistance to Golmbia. As a preface t o such an e f f o r t it was decided tbar a Bank d s s i o n should review t h e Ten Pear General W v e l o ~ n Plan t then being e~k~pleted,  t a n t I f a d Irrission, zshlch sTisited Colmbia e a r l y in 1962, reported generally favorably on the Plan a d supported the growth t a r g e t s prcrposed. It stressed two measures which it f e l t the Government would have t o take t o pslt the econamy on a sound f m t f n g f o r reach%ng plan t a r - g e t s : r a i s i n g taxes =re than had been projected i n the Plan and r e h m - r a t e system s o a s t o z a i s e the effective price of imports. e a t e r fore% e, on a s f e z terns, than h- sf a Private P-~vesment Fund @IF) i n CoPmbia to charnel the resources on t o the private see was particularly impressed. n t delayed acti~n on the exchange and f i s c a l res a d was finally Earced t o fake -re radlca% steps, in a c r i s i s tin a t f cl tle esbd of t, These steps m e t tk Bank% saagin con- cerns, & the forefw g n t s and agencies e ::i a the f i r s t fennal m e t g a g of the @G=uZtati~ti Grmp for a, as a i t had cmae t o be called, fw J a m q 1963, HwnmtW, ia r 1962, tbe Bank b d establish- ed a Wsident Elega?reseatative fn Bi;gom, ly to a s s d s t on Censuftative G row m r t e x s aawd the e m d f n a t f o n of foreign l e d b a g . Bank s t a f f a l s o wrW i n e - f o e rit-EL6h t h e Gdltaadbu22g om she props& PIP, which was es- tablfsb& in M r c h 34Cg3; 16 bas never a b m i d 50 Ef'~lgnctn~g of tbe size ehsaged by the Bank ~stsstonbus tt be aat i n channelling into the primte s e t o r part of the Peso '395 A I D program Iwas -- d e e h krnd a i n 1952 an$ were t&., a i s r b a r eawfmged by rbe Bark s%ssfonbut began l a t e caake r e s m t s a subst%tute E or t k PIF, Exegl~ldf o r a m j o r leas for hig8magrs t ar 1961 the flank's Peending sierce fW had c lrrnrtSaatPd t o be coricent~atrsdaatfiacely i n power. But I963 -wt o i" a larger v01-@ of faam t b n ever before, sate US$75 a f l l i m , includdaag farther Icraas gar p m e t and large Baana for the Paz del Rio steel itna.%l¶ a d for raelr-d rehbflitatisn- I ma11 tecfinical assistaace m i s s i c m t o help WC regfowl p'fann3ag was also undertaken at t h i s rise. Orhg one -re loan was t o be zmde early i n I964 -- -- a large operatioas i n p begore lending was a c e =re effectively, though not owe r f o m l l y , suspeded due t o det-ioratfan of @ l m b i a s s f i m n c i a l a d eccsnaaie situat%ea. Early in 1964 the Bank gave seriaus eonsideratioa t o sgit~g but ia t.he end decided noit: t o press the is- a farebet detfa1t~atio1.l sue t n view of the ex=- unpagularfty of dewlaation i n Gologabia a f t e r the 1962 e q e r i e n c e a d the considerable p o l i t i c a l d i f f l c u l t i e s faced by President Valencda. B s t in M ay 1965, by which t i m e action had became rat that l t would recaminend t o e the full desgred amtolant of lending only b n g e rate action and es- the coffee s t a b f l j e a - iatLom between the the iCozmultatfve Grmp ers e t h e r itba Pitself n September 3965 axdm of Ude-rstandfng r the Government% cur- s for the forth- to a cer&dn m i r a h m of hwrt sf pbl.lic pltf lity t a l if fs -- t o keep pace wkth fnf1a- 9.ar sr?rfous cash flaw lea t k ibgsfdp of t h e l e d b q for 1966 was In dts f f s c a l as- Bfghly successful AHt:hogi@ tk eff-ti- dmlmtim -LaM area 1967 l -- none f o r h- prts ig~d 2% for am8: , B ~ Be ~ t ~ iaan QZPIJ f l d b a t c s fsrefgr~ -- flsxfble r a t e aegrrlte~~ was adarila~tksc less than t k sysam as a sat2 s S a c t o q b o d s for glluatha ftts d e v e l m m t effort a d fael amr e sEPltpBeudlzd d m l q the Eleras Eld?ma was aelgo- tiaeed gt20c'Ia Sgmw in 1967-1930, prosid5 i f m the Cbv- er-nt to pleas and f o r tbe W a%c to -fadieate its cmcems a b u t the dewe'bopmmt e f f o r t o r d e w e l o p n t paltcies. The primary Eocus of t h e Sank remained art a few keg items -- princbpat1-y k p r t jliibera'll5zatk~n (especially i a a i - tLally), Hatianal w e r m n h savings and iuuvestwm&, growth of minor ex- ports, 4reform oE the parlbjlic aatilftp t a r i f f system, Specific targets i d e r r t k f i d i n tbe Mmran& have generally ken reached o r nearly seach- ed, exce,t in ebe case o f m i m r exports *ere t h e r e was a s2fgh.t short- faP1. The ansu'lltat&ve Grwpr, P JBrP ch bad be t a a c t i v e s h o r t l y a f t e r its second metflag, f n 1964, due eo t h e deterB-apratioar of t h e ecoamlc s i t u a - S&W& a d belad a t h i r d meting i n June 1963, short- reform bad heen a b p t e d . A fmnoth meeting took glace fauther -etiaags were k B d e a r l y t n 1971 a d 1932. Incesest f n @loraollpfaas dew n t and r d i n - s t o help ffmmmce it appear t~ h v e imisrep~td M t h each fng. The U m l t d S t a t e s baa remained the ggrimf-l B d e t , Lsm% 2 4 2 a P n l g f n the form of a risbng trend. Z mm EM7 t h e E a a =ptfatedi s p w t a l g o h t d%mncba;garra;nigwznts f o r a m - BPn1- auppfkfer c r e d i t s with f t s ~ D W W f U s for three proJects, a d rposae BSS15-20 m % B l d m of & % l a t e r a lc r d b t o were eve~3ltu~Ply raised i n t h i s way* darn I w r t a s t fmst nal of &mralmt%mCroup a~peraeions%%as been Th5r is r c ~ t e b n s t w l f s e of dsttePo-nr paoje?.res, prepcured inrcreasfng- Ey a d m pr$aci-lly by %be BTaaa.%l% Wparm=t ibvt i n c1osie cooperatton wdth e k &&'s JesSldene Relprea~leaktatPve i n glogota, f o r *fch fimanacing ks i~a@ftm t G ~ W : ecg~1~~ltiPt;E.rrs! mred siJIortEy k f w e the =%rn MmmEhatLwe Gra t i a g s , a d s i n c e 1969 a n a o ~ l l y ,and t h e ptcssrslre t o g e t the f d s t psle has bel@ t h e Plan- r t & q Mgatmmt ra s - eattmE 101 ~~e~spagd%ng agegl~te t~o degine t h e i r dew- ns. F i r s f ii&raEesof tbe E f r t hoe $ m e r a l l y sestslzed 5n alg- n t s af %kmm%~ltr, r q w s t e d much l a r g e r than m a: l i k e l y t o be awaflbtb8e a d Mrp&; readf b w e assist& Zta a t t - i m g i t d m to =re manage- a b l e pa:oporcians, nrat gene3:aBPy t h e basts of tk intriansfc merlts of t h e p r o j a r s Bmt r a t h e r t b i r t.eadfness f o r execattfort. The Bank and t h e Plurnilhmg Wpar-nt b w e follrr~u@d up t h e f i r s t i s s u e of each L t s t with perSdfc, ge.laeralllp q-rrerlg, reprts on the status of financing ar- rangments f o r each project.  'Phe majm part of the financkxg both requested and provgded has s in electric CransportatZon, in both sf wafch e recently the h P k d Z m g e in term of mounts. m iadmstry, bat ehese requests a h a beea requested E e generally requested for i m of project ffmncing estle pclblfe r A~ildai8isyof fsrefgn more credit avail- Id =turally we; there have been f the erediPts pgcar&ded, though amLhbXe Erma the Wmb%qtoaaagencies. , and %a 196% Lt began kba of projects i n tasaee in !the prepration ob sa. 'Teat B dlri~n the f t t s t t h Overview of the Bank's Effectiveness Tlpe Balaac bas w d e major cowtrkbutions, both ddrectly and i n d i r e c t - ly, to raising resources for a p p l i c a t f m t o delsielopent in Colombia. Not only bas the ?&ads Pwned a l a r g e a a ~ u n t f t s e l f but i f h as a l s o done b- prtaaat f u d - r a i s i n g aasong ConsuPtak2are Group ers; both have helped t o r e l i e v e t h e balance of payments ~ ~ t h a %m t n Colon$Piaw develolpment, The m n k Ems aPso played an w o r t a n t r o l e %a helping t o r a i s e funds Ln- t e r n a l l y i n mlmbia %or publlic s e c t o r fnves-at. It has s m e t i w e s made its rn p r o j e c t loans w a d i t i o n s 1 om specfftsc s t e p s t o charge more ade- quate prsces fFg)p: services rederedl <e.g. Ln pasxs and water s2;1pply). By k l p i q t o stremgthea a d make more e f f i c i e n t m j o r &werr;znneat spendling agemcfes, aueh as t k Mimist- of Pwb'lltc W o r k s , st has probably helped to s w =Erne t a s owre- traditi-1 C o l e f a n reluctance to pay taxes. *st b w t a m t l y , bas b e l w o w r tbe last six o r seven years, m t s w9ith t h e ~ w u e r ~ a I tt o r 0btaZb3 amre tbme1.y Wwalzr-nk: dec% a s These e f f o r t s on multfple f r o n t s , faQ2aaBdtaa d gm leders, k w e k e n m t u a l P y reinforcing: c n d % th s enabled B ~ C Col~mibiaitan authorlties ra a p a k d the size of t k S r dweB us: pr%r~ilkl s u b s t a n t i a l l y over t h e lare dcade, a m3 ohere bs ma cvfdeme t h r Eoreiign c r e d i t t o the publLic aeetejrz h s s u b s t i t u t e d f o r d - s z f ~ tax e f f o r t - n r q b f e s am I e d t q , d P e h has hean prLn~fpal1yf o r Barge in- dfw&&m1fmf.r:ostm~~~ure prajecrr: helped s u s t a i n the growth at! tk d e r a vrtfan #sf the ec td c%fefly in the l a r g e r II%oaof loan disiburseaewts, but at- tbrwgb effertts to stremgthm the rene~siblefaastftutZom and thritaiqh a d d ~ 6 ex LB h r p l a y 4 a iemcfal 2 ~ I t c y , .r?n eP%mtaaating 0 ~ ~ 4 bttllt-ks in r31g arm& tramspars: a e m t k and ia parer supply to 2 -st 6% t h e -gar centers %n the aumtrgr. 1 s: bas dHsbursed funds f o r b t h p e r a d rrraaspxe d e w e l a p n B every year since 1951, but p a r t i - cularly heavily %m tbe e a r r g 1 s -. The t r a m p o r t 2nves;tzhlents asslisted r kedEng i n the 1960s was orient& t o creathig t kne nucleus of a o m l t;1:an~%ssion s e m r k , If&inj&.t h e a f c m : c%t%es. Through f t s in-lv-nt i n t r a m s p r t and r the k P wd to aeet rhe huge in- w e s a n r requir-nts *lid by rap%d ufiaanizarion and indbrectly t o a u s t a f n t h e m d e r a t e pace .of i d u s t r f a l g r a s t h actafned. I n t h e 1960s it a l s o a s s i s r e d k d u s t r l a l m r e dbrertlly thrmgh its loan f o r the Paz del Rio steel maill expansion and through several loans to five Financieras for on-lending to the industrial sector, Not all the proj- ects, and especially not these in railways a d steel, have proven very efficient leans of meeting the requirements they were designed to meet a d there has been scme over-investment, but the projects are generally better than they are likely to have been lrad there been w, partfci- pation, and the outcame of the w b l e investment pa is reasonable in tetas of efficiency benefits. In recent years the bas lent for projects in otber fields, but they are at too early a stage to be clear about the outcare; generally, ojects in agriculture do not look very praising vhile those in tion auad water supply do. In its work in Colabia, the Bank bas deweloped rather an effect- ive cabination of its orginal imrestilrent bank approach to channelling capital f r a foreign private capital markets into development projects aud a ltrch broader recognition of the tance of policy and structural arad the effectiveness of of l h i s is in the institu- splayed unlimited confidence in 1 aad guidelines, and in lerggl and c~titutional rsarrrrrcs to create an imstitutfon which would operate effectively. fn the 19608, the B r aYt' cs best SntSitutioa-building work has focussed tuch m e on tbe way an institution really works, rather its legal a d cotzstitutioarl forr, fie Bank" contribu- in the farm of conceiviag a basic idea, suggesting studles, proved favorable, pressing for iaplatentation, the actual nts being left emtirely Ito the Colcmbtarasr: this was the pattern with the P c m r Inter tioa, the Utility TarPff and, to saite eartent, the lDatioaal 'tkl F d . fa other cases the ' s con- tribution bas been at a m c h rather the pkilosophy, Particularly at concepts md organizational essential -- levels basic made very useful contributions to institutional devel in same of the fields in which it bas been iawolved. Another illustratdon of hov the has refined its techniques is in the field of sectoral a d mat c policy. fnftial success in the provision of advice in this field in 1958 was short-lived due to pol- itical change in Colabia and the Bank's decision, in the circumstances of the day, to eonfine its mafn effort to ladividaal devel  the W a m z a t , were rather imf- @1aapbia1s bmce$rrarte f f s a a pmjeefons a d the Bank's Colmbtan ecommy . mld6aB s recovery from tors Esm the basts for Key elements tra i;gn exchange gou- falirly effect%mPg iuBffPld. Another constraint on the . ft left -st projects of aefciultmal sc the Pdti*ive to help leets ka &St, with -considerable - 1 export potential. It bas not consented to finance eqberbental projects -- -- 1952 for instance in livestock, where that was urged several times since finally taking instead, in tbat area, a fairly large-scale proj- ect v trrich bas yet to introduce substantial ticns. It has had to refuse asauy of the Colombians' requests for stance in other areas which seeat to W e merit, particularly from the point of view of stPmul- ating use of local re and wider participation in the development effort; possibilities ing and public health have had to be turned down, within the framework of its lendimg policies. It has not been able to k l p realize the potential of the lukerdfurniture industry, noted in Boak reports for two decades but still largely latent, For the industrial sector in general it krs prodded rather unconditional support through the Carporaciones Finmeieras, altbough the policy environment in which they t10* doer not seem to be conducive to chamelling their funds towards the # w t efficient producers or tbse most constrained by lack of credit. seems to bave fallen short of its porenrZal in these areas o udersta-ble in historical pers- . rightly sought to use its financial and technical resources za the C o l d t a n 6.MP growth rate, but oa the basis of a ratber short-term perspective, a d with much more to ~inimizingrisks ~ t l Hd-1 projects it would finance zing thcfr dewel t t. Infrastructure projects were chosen as the initial orin c h a m 1 for support to Colombian develop- ment, aa;d t ltrcg r m i - pr a~nt in terms of fbwnciag provided. Much pr-eas iiaa k e n pade i btening control of thebz as investment baak projects; the huge cost ovet~uns sa gbay a d railway projects have mt beearepetatedad the major sho s in design of the steel projectfl~)~ld probably not recur. But 1- relative to develop- t irpact r a i n , both related to undue consentrarisn on the risk mint- lfzation aspect, thls 8ap be. First, projects have been selected with a be5 ily amtrollable a d to yielding at least a threshold rate of return. I n utilities this bas tended to mean gioing strong preference to pmjectsdes5;gatrd to t so-called %establish- ed ' which is more easily predictable. Whether the projects were of or in the place that could have the tnosr impact was given anach less attention, provfded that the threshold rate of return was met; eh-rs applies to the steel and irrigation projects, for instance, as well as to p ower and tramsport. Second, appraisal of the project has tended to concentrate on checking that the threshold rate of return would be met, t o the exclusion of what eaglenaeataq measures would be needed t o get w x h w development bernefiks from t h e project Zra question, especially i n the region affected. This applies part4cauIarly i n transport, but a l s ~ ,for Be, i n power a d steel. Early i n the 19605, a s a c m l m n t a r y technique t o f t s finsxac.ing of i n f r a s t r u c t u r e projects, the Bank began t o work towards provision of m r e darect suppra: t o i t y prducfng sectors a d t h i s eventually materialized i n large 1 RI 1966 a d SoL9mf.aqg years f o r on-lending t o prfvate sector i d u s t q a d agriculture. The Bank had always had eorrsiderable f a i t h Pn t h e efficiency, as w e l l as efficacy, of f i ~ ~ a n c i a l guides t o dewelopemt, a s indicated by i t i s earliier efBorts Co in~jlure Colm3iaaa a r i l i t i e s and railways, BOB Bmmsace, t o sfmulake private ser- t o r o p e r a t i a . I&ediqto prlwate sector lntemedi%aries, a6 a time when ehe was a l s o w q o t f a t i q annual policy agte-nts d t h the Govern- ment, gave the - & the o m r t u n i e y t o learn much ?more about, anel to deal d t h , same of the defleieaaeies i n the s t r u c t u r e of the Colmbian cap% tal m*t a d other incentives -working agafnstmost e f f i c i e n t use of the colaa&-% sesoanrces for d e v e l o p n t since most dlewelopment i n Colcmbfa i s i n the priwalre s e t o r , Plrtuicb still a c c w n t s f ~ a rtwo-rbirds of invest- mat, t h i s could be oE p r h e b p r t a n c e , Vet apart from urging more rap- f d devalmtiolm of the Peso, 19Sisera~aeragiwiexcess~~t? t a r i f f protection, and supp@rtZaagCalmbfam m v e s t-rd higher faaterest r a t e s loa loasas raut of B a d fads, tbe did not a l l y pursue these issues beyond an OC- cas$owal c d l l s c u s s i ~i n an e c report. At % t h e sane t h e prfviite fa- vesmlatt h s gr-l~1 a t a. disappfncing r a t e and private sawing has b r d l y s o w r a . The J Ia J nm k - e m s t o have bad too m e h codiidence in what the priv- a t e s e t o r cwEd aebsewe i n t e w of effrtdene resomce d e v e i l o ~ e r b , it- respective af t h e fr=-wrk of publf c plisy %a WbkcB 56 was u a r k i a ~ . I n the Patter p a r t s f the decade 8h Ba& t cd i n t o financing various projects which it eonsidered t o be plaa porea ant contribution t o salving the prsblees of pawerty i n a l m b i a -- partfclularly the PNmW i r r i g a t i o n a d cc8loaizattioa projects, a d t o some extent, the projaxts i n social irafrastructtnre such a s education and water slapply. I n dae 1950~ to~ the extent thao fa: had recognized the problretra of poverty, the Bank did not f e e l t h a t i t w a s particularly i t s respomsibility t o help c o p with it, Pn the e a r l y 1960s i t urged the Colmbians t o h 9 1 d up the mdern secccor of t h e eclonmy as rapidly a s possji'$le and t o a'BPocate mare of the r e s u l t a n t i n c m e to social welfare measures i n a i d of the poor. The12 f i r begaa t o support a few projects aimed e x p l i c i t l y a t Increasing the opportunZties of the poor -- provided each project met i t s standard fiaaxtciaX and econmic cr-iteria of efficiency. The d.iffirulry is that some of these projects -have been expensive and have benefitted relairiveIy few of the porn -- p a r t l y because they have sanetimes tended t~ subsidize the rich a s w e l l a s the p m r -- a d , more bnportaatly, as an apparent solration t o the problem of poverty, they mag even have discour- agdtlhe ~ a s a s r ~ r e ssuch , as l a d redistribution and hproved incentives t o a a p l a m n t of people, that are s q u i r e d t o get a f u l l e r application of C o l d i a ' s refsoarces t o d e w l o p e n t . The extent of poverty and i t s f u l l ianpl.lcatbom in. tlse e c o n d c s t r u c t u r e have been too l i t t l e seen; f t s e l b 2 n a t i o n bas n a t ~ s r a l l ybeen c o a s i d e r d a dessrable end, but a s r e s u l t - 5ng from a =re rapid asion of the mdem eco (which may i n f a c t exacerbate it a t present) rarfier than critfcally interdependent with a swre e f f i c i e n t use of the cotantry's human and physTcaL resources, These pr&l- i n t h e Bazik's v t q o i n t stem frpgl an dnsufficienrly brcusd a d Img-range basis for decbsf0~1~i rqard5ng project selection and lendfw e d i t b o a s and s b r t a g e of t h e on appraisals, They can be mere* with applfcaeion s f rmre a t t e a t i m to the bash resources of Cslmbba a d the way they can best be c d b n e d to maxhize development. T b c , agabnst tihis abackgrmd, zwre efzort smld be! devoted t o i d e n t i - ffcatfon a d p r w r o l t i o n of ;psi~jeces, c b s e n '$erause of t h e i r potential eaatribalSonrs t o Wlmbf an des=31 tratber than because they fa13 within t h e e pro)iect. Lending t o Colombia, es- peeLorZ%yever t k lase 5 cn: 1 bas s h m sharp fluctwitions from pear to pear, am3 eswcPally years such a s 1966 and 1967 the Bow PewcE 0% Hediq b s t m u l t d frm shareage of projecrs, Hore effcrrt an prrrjeca weptiracEora, b~ the Bank cm by t5e mlmbiaas a t the ad~ee of &be %ak, cm1.d b w e restnBtd in x mr e Pendfng, Both Colombia's debt s9.rri.iee r a t i o a d the %&*s sbre of the comrsp*s soreign public d&t 'Isaye & = l i d%%nee the early f%Qs a d well-chosen projects and sur- emld have left these r a r i o s a b u t a e i r e a r l i e r levels, uf.l%he helping r o reduce the prrrbTm of m e r c y and a t t a f n more rapid groutko* T b princip'4. e f f o r t of this evalutisra, as of the Batikis own past work, has h e n on t h e various d e w e l o ~ n a projects : far which the Bank has sade l ~ ~ t a s It . was possible r s subject 33 ~ u of t the 43 t o t a l number of loans t o reasonably thorough evaiuation, t h e p a r t i c u l a r emphasis var- ying i n each case according t o t h e i s s u e s r a i s e d by t h e loan and the time when i t was u d e , The only f l e l d of lending omitted from review xias te- nications, a d t h t s was e n t i r e l y due t o lack of time.PJ Table 2.1 c i a s s i f i e s t h e Bank's lending i n t o t h r e e major groups and shows dis- bursements and c tmezats through t h e end of 1930. E l e c t r i c p e r has been much t h e most k p o r t a n t s i n g l e f l e l d i n Bank lending, accounting f o r s m e 402 of the t o t a l . The Bank's power loans have gone t o s i x out of t h e seven l a r g e s t cities i n t h e country & t h e m i s s i o n is B a r r a q u i l l a ) but they have been heavily concentrated on Bogota, Cali, and Medellin, the t h r e e l a r g e s t c d t i e s t-ether accounting f o r sane 207 of national population a d 60% of i n d u s t r i a l production and i n s t a l l e d generating capacity. The p r i n c i p a l contribution sf t h e Bank was t o t m b l s t h e cmpanies respsaasLble f o r power supply i n t h e various e i t i e s t o e x p a d more r a p i d l y t h a w they would otherwise have been able, with p l a n t s of larger s i z e and lower u n i t cost than would otherwise have been possible, f i e Bank bas helped finance about half t h e power gener- a t i n g crapaeiry i ~ s t a l l a d i n Colmbia , and t h e majorfty of t h e capa- city it has financed I s hydraelectric. Mainly due t o t h e d i f f i c u l t topo- graphic a d geskogfcal conditions t h e r e have been q u i t e long delays i n e m p l e t i a n of almst all these hgdroelerrrfc plants and t h e r e have beea east awrraans on most; delays a d cost overruns have been less on ther- mal p l a n t s . Generally t h e construction tielays tended t o occur along with slmer than expected load growth, s o t h a t eventual supply of power kept roiasomblp well i n line w i t h d-nd. Only i n two cases does i t seem that same savi%s i n coats of Iwlk p e r generation n i g h t feasibly have been m d e by s e l e c t i n g dcvelopent plans other than those a c t u a l l y followed: t h e Cali= hydroelecrtle p l a n t , financed in 1960, on which t h e incremen- t a l invesmernt was eqecred ro be sme DSSS a i l l i o n yielding a t least I5X r e t u r n but in f a c t turned out to be about BSS2O m i l l i o n yielding only sme 7-W85, and t h e r e l a t i v e l y small Zipaquira 2 t h e m a 1 p l a n t , financed i n 1962, which probably made t o t a l system d e v e l o p e n t c o s t s some US$2-3 m i l l i o n m r e than rbey might t t h e M s e have been. Highways account f o r about 207 of the Bank" lending t o date, and t h e Bank has played an b p o r t a n t p a r t i n the c r e a t i o n of Colombia's trunk nighway network. Cost overruns on t h e Bank's f f r s t highway p r o j e c t ap- proved i n I951 were e n o m u s ; f i n a l c o s t s were between t h r e e and four - 1 The o t h e r nine m i s s i o n s were t h e four loans made i n 1970 (education, water, power and highways) due t o t h e i r recency, t h e highways & r a i l - ways loans of 1968 and t h e livestock loan of 1969 f o r t h e same reason, and rke two snialf a g r i c u l t u r a l c r e d i t (mechanization) loans t o the Caja Agraria i n t h e e a r l y 1950s due t o lack of data about performance under them.  . Table 21 Commit- ments Infrastructure and Basic Industry E:ectric Pawer (17 loans 1950-76") 228.5 Highways (6 l o a s 1951-70) 96.0 Atlantic Wailroad (2 loans 1952-55) 48-9 Railway Rehabilitation(3 loam 8960-68) 41.4 Steel Mill (1963) 29.1 Irrigation d Lad blecl-tion (1967) 2.2 Telec ications !I9671 - 8.8 Private Sector eicultural Credit: to Gaja (1849 arad 89%) G i e s (3 loans l96ir6-69) 42.9 Livestock Credit ( 2 loans 1966-69) 11.1 agricultural Credit to mm (1969) 0.4 SociaL I~frasttucture Water Supply ( I N 6 and 1970) Education (1968 and 1970) NmE: m e classification of projects in this table is made for con- venneace of the discussion which follows and is affected by historical factors; it: is far this reason that water supply is distinmfsfied as 'social infrastructure.' Equally the steel atill loan of 1963 was to a private sector company, Paz de1 Rio, but for our discussion it is more convenient to classiEy it by its 'basic industrya characteristic. times original estimates, although a sizable, but unknown, part of this increase was due to upgrading of standards. Repeated sup~lementaryftn- ancing had to be provided, and Hlany of the roads were not completed until the 1960s. Nevertheless they seeat to have been very worthwhile. Our analysis of the 24 roads accounting for most of the financing provided under the Bank's first four highway loans and costing a total of about USS125 raillion equivalent indicates an average rate of return in terns of road user cost savings (excluding t h e savings) of 2=, which is very high. On m n y highways vehicle opezating costs have come down by ! 5 0% or more over the last twenty years. As in the case of power, and as might be expected, there are one or two highway projects which may well have a return balov the opportunity cost of capital -- particularly Cali- Popayan and Buga-Buenaventura cases. -- but again, as in p e r , these are rare There are four projects in the infrastructure and hasic industry category, together accounting Cor about another 20"8, of Bank lending, which seem disappointing c ed with expectations: the Atlantic Rail- road of the 19508, the Itailway Rehabilitation of the 1960s, the 1963 Paz del Rio steel mill expansion and tbe -11 Atlantico Irrigation and Land Reclamation project of 1%7. Delays in construction have been a major prohlem on all, postponing realization of bemf5ts from the investments made and hence reducing the rate of return; a11 projects have been characterized by cost overruns too, but these a to have had a ~cajor effect on the rate of return only in the case Atlantico Pailroad for which theg were particularly large. It ultiaatelg cost about twice as much as originally expected or some US$120 million equivalent; the economic rate of return technique was not used at the ti= loans were made for the project in the 19Ms, but recalculations on the basis of the assu~ptionsthen used suggest that it would have been above lo%, whereas the actual mtcante is less than 5%, weording to our best esti- mates. The Railroad Rehabilitation invesents, well conceived but pooriy implemented and utilized, s eepsr to be yielding efficiency benefits of only soate 6-7Z; a quantified estimate was made at the t h e of loan appraisal only for the dieselizatim c neat, some 16'10, but actual returns appear to be in the r m g e of 6-10%. The Paz del Bfo expansion project t' ris appraised only in Zinancial terms; recalculations suggest l that, as appraised, it should have yielded some 7-14%, whereas actual returns are only 4 7,although they may be raised to the range of 5-11% by addition of equiplrtent in the casing years. T he Irrigation and Land Reclaaration project bas been too delayed for any actual rate of return to be calculated, but crop yields have been disappointbng so far. The loans to financial iatewediaries for on-lending to the priv- ate sector are harder to evahate satisfactorily. They are rather re- cent, but, more irportantly, information about bow the rub-loons were actually spent and what ct theg had tion is sparse. The Bank bas placed major is on the int ies and financially their operations with Bank funds appear t een sound --except in the case of one of rhe Financieras wbere ures haw been taken to restore the situation. s of sub-loaas and disbursemints have proceeded very rapidly loans to the Financieras and fairly rapidly, particularly the Bank loan for livestock; they hava been very slow to date on the credit for c farm. Presumably the funds disbursed added to the level of inves t. Certainly they did directly in the sense that they were spent projects --for the Financieras, pr ndividual investment aanntly in the man-made textiles and ce~entindustries bat also inether fields. ver private bnvest- ment vas not at a very high level through 1970 sbrt of earlier plans -- -- fell substantially and statistically there is evidence of a neg- ative association i 0s b e e e n inflows of long-term capital to the private sector tic private s a v ~ n g s . ~ ~ data are not The very strong and it tlould be a lcmg and uaatarranted step from our - 1/ Analysis of balance of payments and natfonal i accounts data for t%e period 1360-1%9 yields the following results: Private Saving = 0.159 - 0.5526 STP - 1.3248 LTC w2 = .69 ill.4) 13 9) F d l y Saving = 0.040 - 0.7835 STP - 1.0043 LTP R~ = -85 il3*8) 15 8) Where: STP = gross hart-tern capital inflats to the private Sectors LTP = gross long-tern capital inflows to the private sector. Figures in brackets beneath the coefficient to which they refer are "tt1values; social scfentists vary in considering a "t" ratio of 1 or 2 as the level indicative of statistical significance for the variable in question. 1 12 is the standard regression coefficient, indicating the goodness of fit of the equation as a w b l e . findings of a broad association t o say t h a t the p a r t i c u l a r IBRD compo- nent of these c a p i t a l inflows has had the e f f e c t of reducing danestic savings. But the a v a i l a b i l i t y of foreign loans on long terns, with t.ie @eve t taking the exchange r i s k , may hawe affected savings within the ry, and t h i s needs investigation. Sonne doubts a r i s e a l s o a h t the ef%ciency of allocation of the funds. They have tended t o go tnainlg r o l a r g e r producers who were on the whole best supplied with c r e d i t already a d T&O do not generally seem t o be the most e f f i c i e n t e i t h e r financially o r econcnaaically, according t o the s t a t i s t i c a l evid- ence available. The tentatgve nature of tbese var-ious findings, due to t h e paucity of relevant information a d t h e still f a f r l y e a r l y stage a t whieb mst of the projects are, amst be stressed; but they do raise doubts vhLeh w2ll need t o be resolved i n the Bank% suture action wf rh the c r u e i a l l g t a n t private sector. Tbsoci~'idafrattructvrregrojects,f o r ~ i e b l o r n s v c r @ ~ d e i n l ~ 6 8 , are s t i l l under execgtion a d s o i t was not possfble t o study tfiem fn the s m e way as the b i g b a y and power projects. Z#evertheless w e review- ed t h e i r perforzraaace through e a r l y 1971 a d found both projects rather prmisf%, 330th hawe suffered idf!.ays, but there w e r e being m r c m e . The education project, p r d d i m f o r ten cmpsebemive secoladary schools, was kfpfnning t o f n t r d u c e ; a r r a q %om t o the Colombian educational systm, i n r e s p e c t o b t h s y l l teaching tecihslfquies; several s t d f e s anbermken f a t h e l a s t feu years indicate a r a t e of return t o ex- ion of s e c m b r y &cation in @lollmbfa (merely i n terms of increased ings Iilkt?ly) of around 243% c w r c n t l y . The water supply project, f o r got&, Isas Bern coarraerted r J f t 7 a asaajor wrov-nts tin the organization and m a g m e a t 0% the e q a q rer ibPe and w5l1 r e l i e v e deficiencies i n the qultntfty a d qualtty oh water supply f o r the city; expansion is beiw a e h i e v d a t a &action of the unia: c a s t a e s a r g e d by she cawpimy before dtscussiotas wit& the Pkilak began. Sme %rrk a c t i v i t f e s ba;\re mde usefar9 c o f l t r i h t i s n s t o the crucial task af skobilftf= d-stic r e s m r c e s for dewel nt. The agr5culturaP c r e d i t projects of tihe 195f)sb.&ptsr?l 50 brtiag fve new l a d s under culti.;.stion, and bnrrprov-nt of the t sport network se-s t o have been connected with s m e t e a l l ~ t f o r n &ions, i n accorckrace with cmparative advantage, of p r d u c t i o n c i a 1 crops such a s cotton a d sugar, Bqroved public power supply seems t o have been significant i n enablizg expansim a d inaproved efficiency of the amre labor-intensive m a l l - s c a l e i d u s t r y t h a t could not possS-bBy afford f t s own power plant; several instances of t h i s were encounter&, Design and construction of Bad-supported h i g b a y and pu;blic u t i l r t y projects bas Been important i n t h e $rcnth ob the d-stic contracting a d constnlthg engineerin& indus- tries; a l l regular highMy work i n the 1960s under t h e %a& projects has been done by dumestic contractors. m e %Ilk acted a s executing agent f o r a WW study of Caaca Valley coal ressurees i n the e a r l y l96Qa, but I h - eaasued. Technical assfstance requ%red by the Bank f o r hat rkae helped b-rtantly t o bprove use of the cmpa- raw =ter%als, and saze el-nts of t h e subsequent proj- e c t a l s o contrhbatd. I ra t b e Bate 1966s *be played a useful r o l e i n perbaaing the Gwsrrakent t o adopt s 20reign exchange rate applfcable to o i l eaplorrztfsat actSv2ties M c h would give the international cmpa- n i e s the necessary imeaative. %ore g a e r a 1 l y , the B a d ' s eaiphasfs i n t k Bast five years of the BWs on r e d u e i q owet:.3laPtaat%on of the ex- ebpzge rate a d re%fMngthe flnraaeial eoastra2 t h e expansfon of -13-tm srtflft%@s is k1p-P- t o mere- ewe tgnt obstacles to 1 -1 remree d e w e l s p n t . Tbc m& bas s.wt been a b l e t o make much contribution t o re- s~1vi.ask: the Eseo b y B a d tewre a n ehfs area -- tk concentrated pattern of & the i%aemptbti'ipc mtaaare of capital mrbrets. I n respect of l a d teaun'c eet: -may bwe been rather negative. I n t b 1950s it s ures ta f;afe=b$j;r I & util2zation which, fneffeietfve, In t h e 19Qbs, a f t e r t k t WI-fam had d w t d 1 s a f es t o the as- end, the Bank took a very resew& p s i tiom, newer z f a execution of ePp a k ~ ~ ~ P y rbe along other lines which prmed m a t e wirh the s t z e aH t49e problear, f a con- a9ctim r p o b l m r h =in r o l e of t h e Bask has h e n , in t h e l"350, to gr-a the fm&t:5- of prfwate Ffzlgncieras and, i n t h e late 1 % ~ to ~ 8 u m r t them wdth a d ~ c e m imtiitastiornal 5aproafe- =at a d subsitantfa1 fla9a%3tiq. Hgillt t%e F%mp5cierashave so f a r made wery l h i t e d e m t r f b t o c a p i a l m r h t d9velomanit, mainly due t o deffieiencfes i n tbe -1fegv =wdro=m?t: 131 wkiich they work. But neither tion v i t h thie l a m eo ehe Fimscieas r ao r i n m g o r h t i o n s for awda of .Egaaderstadiag Piers the W& wrsud the crucial issues the p r i a e i p l e of iw s d i n r e r e s t r a t e eeilirsgo, heavy forced investment -- - 1 8ng eagfneering firm, E e r l e , has grown between 2960 and 1970 frm $7' e%fneers and h i f l i n g s of VSSO.6 a i l l i o n equivalenr to 186 engineers and billdngs of @S$4.3 mZPlion; 80% of bib2ings over the vhole p e r i d &axre been f a r a & - s q p r t e d ptojeclts, The Bank k a i s fncladed fn same loans special prop.%sions f o r coverage of Peso en- gineering costs. by financial institutions, lack of mrket for speculative shares, general fractionalization of credit msrkets. s on dewefopment of indagtry, which i 11 in Colmb%a, part- other reasms. Yet s dot: the P a t deP obtafned 1 -1- reasen. ZLpaquLra 2 Sate &fficulty could "Pkrdc saoaj has to finance mctxure Fojmts also the &a key resource tel s ~ a d(%&tail a ma i Qtoll) partly because  d assisted lin tkse areas, and it expZicitly r e f ~ assistance to small- bn recent years, but d y aut4wl ill~lllstsmsps* d l l i o n were effect of t k rmr rtant hap a IIP tax ismatson of the later 19608, int asl of dtfnllnoldla at scwre hereases h the gasoline tax is certahly progressZ~e. the credit iptottpded by ebe Fim~~~Zaer- to large entgrprl ler glgtewrb~e~, e-eby i e 9sw t b i r crdPt skirt staftial Zaterest d i b f e r a t 10 or lnoge percatage pofaxs) will eriPl b e accrued to the Wger  I n =st areas of t h e economy where i t %pas been actively involved ha s made usef uP contribut Zons t o s t r e n g t k n h g administrat ion izatioa a d A n s e areas f t has played a c r u c i a l role. Most of t h e more successful c o n t r l h t h n s have occurred 5.n the 19160s a f t e r tk Bank bad gained experience and t h e p o l i t i c a l s f t u a t i o n i n Colombia W beeare mre stable. Especially rrotewipi-thy examples of d i f f e r e n t types of bstitut*-building work &we beera t h e 's long e f f o r t with t h e ]Elifinkstry of h b l f c Works C h l t a d a formation of t h e National High- way Pd), e s t d l i s b z r t of the U t a l t y 'Tariff b a r d , creation of the % with t h e Bogota Coapany (IS), i n 1968, m c y by t h e Bank t o and d e s i r e t o keep Ilses for th-elves, Withmt t h i s d5plornacy and f t f a d h l y t b t t h e intericonnection, which f e l e c t r & c f t y , would b e k m aehf-rPril t i U a t least sewcip.91 years later. By refusing t o f ~ S ~ of Da p Pw o er supply s t r u c t u r e which s t u d i e s P Id bee- k e f f i a c i a t t b Bank assisted structutaS cekwe* Tr does m t :s - t h a t k n s t i t u t i o n supjpa~r~ted by the Bank have prasi- zawlty hurt a t k r fxnstttuthns, e s p h j i l y %base sesponsfble f o r other prAoritp a r e a s of d m e talemted personnel. Ent X- ties s;ruppacted by t h e s e r o w e r than others i n tbe s - fiead m t sa s u p p r t d , h t not cost og the l a t t e r . Much hstitusimH h p , eapechlly En the 196Qs, has been isa t h e form &ncasml o r g a f z ; l t i o a (heldjing trainbnp) rather than arSiditir6wraa3, ~ r m m e or l p a r t i c d a r l l y ealented personnel Ian prajeeit did od course Bnvolve recruitment of ss of teachers, but there 5s no ~ X d e n e e of t h i s b 6 n g d e p P e t d tk g ~ l d t y of tearhgmg staff $in other wkrools; m a y teachers tc"m baeiFPtred f r m the trafngng c o w s e s ~ o Y stayed U ~with t h e i r old sc%nao%s, 'Iltn genesid., due to t h e r a t h e r adequate supply of university graduates 3 a e . l t h e imtrisnsic a t t r a c t i o n ad t h e major c i t i e s , and t h e u = h s s and I s&ze of tk mblit: s e c t o r relat2.ve t o the private seetor, it: is u n l i b l y that such t a l e n t as was a t t r a c t e d t o Bank-supported i n s t i t u t i g n s rsou3d o t h e d w [f.e, i n the absence of Bank support) have gone t o itnstitutions (or consultanat f i m , etc.1 eoaeerwd with fgelds  where development has lagged, without special e f f o r t s f o r development of t h e latter. On t h e other hand the demonstration or spread e f f e c t which the B a d hoped its projects would have also seeas t o W e been very l h i t e d , except w h e r e special e f f o r t s were made t o amplify it. Tkre is no evidence of u t i l i t i e s not financed by t h e Bank h i t a t i n g t b s e which were so financed. Both t h e Winistry of Public Wrks aad the Pinanrieras t o maintain one staodard of project preparation aad supervision f o r wo inanced d e r Bsrnlr 1 - and another stadam3 f o r others, although i n the case of the Financieras t h e BaPk bas made considerable e f f o r t s t o avoid t h i s . The only exaimple of automatic spread e f f e c t arises in connection with 1% where the u t i l i t i e s i n the north-eastern s do appear t o have begun co- operation with one another in order t o exert greater influeace. Iaduced spread e f f e c t has occurred as a result of recent special e f f o r t s l e , creation of the U t i l i t y Tariff Ward aad t h e Bank's emphasis on -- for reg- plamrfng in coimectian with tk Bogota water supply projects. Fiscal and Foreign Exchange Constraints - Oboiously tb own resource contrfbaztior, has helped t o ease f i s c a l ard f o r e constraints on Colombian development. E m ry year except 1959 it e positive aet t r a n s f e r s t o Colmbia, rroeraghg US87 rrf;trioa axmually i n t b e U5$26 m i l l i o n i n the 1960s a8d reachisrg USSO a i l l i e n in 1970; most of t h i s has been t o the public sector. These net t r a n s f e r s were iequivdeat to be 1 4 2 percent of Gross t in t h e e a r l y 1950s aad between 2 and 3 per- cent in t reached nearly 5 percent in 1363-1964 when investsent f e l l so f a r short of earlier expected levels. Beyond its own contribution t h e hdt has also played a e i g a i f i c a a t p a r t through the vari- ous rechanfsm of t h e l t a t i v e Croup in enabling tbe large b i l a t e r a l c a p i t a l t r a n s f e r s uhich lmve been Pade in the 1960s. t o t h e f i s c a l a d foreign errchange con- wsis of Coleabia's problems t h e particu- i n policy advice t o the Gover t have varied ssion of 1949 stressed both, but not other problem discussed before, especially iatratfon. En 1942, foreseeing the end of a major e f f o r t on or exports. But by 19% t h i s g p h a s i s was dropped, pre l y r e f l e c t i n g the h p o r t - substitution ideology t h a t was sweeping Latin America, a d t h e Bad even advised against further tax -kreases, probably due to concern a b u t the way in which tbe -S spending its resources. After 1956 t k f t naturally received the main erpbsis, and the neeti f o r au gsd. 1962 w as on t W s seeasion, as for the tb fiscal d , h ~ m ~ e rfn , 1866 tration, lnfnor ia the r9ms, hat tfon wittr E s.mf~ti&xk. Wfth the forsra- -re eff ectbve part id- tib a slightly faster goliti c a l ~ y very d f f f %cult, perihaps eispee&zIly in Coltoaibia for a i a l a r l p the very great cwarative advantage that the country enjoys in eoffee. It h a s been a major achieve- of the past 15 years t o bring the eoffee farmers t o aceept a rather le, and quite low, proportion (about 36-57Z) s f the Mew York value of their crop- Xo Bank might b e been able to contribute even more effectively in the desired dZrect~sn by, for i~st;srace, undertaking or c a factual a d sbjeetiwe study on the distrgbn- t i v e effects o (unclear but ofem used as an argument againei: the step) and by urging -re u i a i b o d t g Pn h p r t t a r i f f s or, bn their absence, greater use of s W o u prdcea in cor~siderat%on 05 major public By the late 1968s there bad emlved, kt t k rehtZosns between the a c-1.e~ d e l h t e l y blamced pattern of hesldlhg ters. Inft tb US AID pnegrm loans, i t 5tg a x i f f ~ 1 h 1 37 of bnstitu- ltal aature, Its d t k Gswemeat hmetbth~~g re vt:centbal h t e r - vmy uscrf'd: t k Wank caa amist a d s a t a11 thgse lmds. coatleihted mre to lar there! are two p sions, Orre! is that appraise8; %areepvln tbe s to d u l l h p l e - ratfca of agseerd poSfe e s~~ is that t k s b M provbde part or all of its led- i n a program form, mat attached t o M % v M m lprojects aad available f o r general h p o r t s ; as regards conditions, specifZc agreement wouzd be reached about c e r t a i n broad policy parameters - such a s taxation, c r e d i t control, foreign exchange rate - w Z t m t h e framework of a broadly agreed o v e r a l l d e v e l o w n t plart. Specif5.e requests f o r lending of t h i s s o r t were m d e by t h e &lmbian Government bn 1958 and in 1968 but both w e r e r e j e c t - ed on grounds of inconsistency with general Bank p o l i c i e s a t t h e time. There is a f a i r l y widespread f e e l h g a t waie l e v e l s of policy-making in Col-bia that project-lending of t h e IBRjD-type, while i t has advanitages in terms of a s s i s t a n c e t o i n s t 5 t u t f o n a l development, a l s o bas disadvantages in terms of d i s t o r t i n g t h e development pattern; sand t h a t t h e l a t t e r have tended t o outweigb t h e former, even though l a r g e m o u n t s of program Send- 3ng b e been provldd by US A D a d much o r t h e Peso counterpart has gone t o cover t h e IoeaP c o s t s of p r o j e c t s for d 5 c b t h e foreign c o s t i s f-need f r m other loan sources. Several of t h e major p r o j e c t s reviewed ln t h i s s t d y h v e not Biwed up ko t h e f r o r f g f n a l promise -- t h e railway scb-s, t h e Qaz del Wio e x w n s b n , the AtLmt%co a g r i c u l t u r a l p r o j e c t , Gel- dam and tk Cali-Polpayan h b g h a y zisaZn939 -- ht i t i s most unlzkely ttmc these mu1d m t have gone ah& had t h e W k provided its f i n a x i n g f n e sslgrm rather t h o a p r o j e c t form; ouPy t h e t f p a g u i t a 2 thermal m e r se might have been avoid& wit83 t h e Bank Pending on a program r a t h a t k a p r a j w t Itpasgs.. lira faerr ~ ; whi.cld reiEerence k k a l l e g e d d i s t a r t h r ~ to i s made by those w b bfkd t h f s p i n t of v&ew are dfifereziz, T h y arSse p a r t l y from the dSfiaru3lty of s b t a f n i a g prcijwt loans f o r c e r t a i n rypes of p r o j e c t s -- f o onr a m p l e , mral &t~catfonor public b9aPth -- and p a r t l y from problems of t b i g l ; ~ : Eor h s t a ~ e ,t h e mt50nd hwesosplent budget n;as t o be cttt, prkprs because of a fall &n tk p r i c e of coffee o r a la^ B n r a i s i n g taxes, a d p r i a r i t y has t o go to t k p r o j e c t s t o d i s h s a p f a 1 inflows from f o r e i s a s s i s t a m e a g m c f e s are t i e d , while other prasjescs which happen nor Eo be teejigpbg f o r e i s a s s f s t m c e are p ~ l s d i n t o tb f u t u r e o r pro- du@Eion i e a p r f t y a f s t k n h : i n t h e country f s l e f t fd1e Zer lack of imported s p a r e parts ifad raw m t e r i a l s . Hence p r o j e s t s proceed a t a s p e d deter- ~ 5 n d by the size of t h e f r forefgn a c h n g e eawonent ;PfZd sponsorship from a Elfevreign a g a c y S P B X ~ ~ Ufor S rapfd dfsburs-nes r a r k r than by t h e i r Jnrrbnsic grZority t o d ~ e l 3 p ~ t . Tim-e is one perf& when S t i s f a i r l y e l e a r tPaa't. d i s r o r t i a n s of the type d e s c r g b d did occur and when provision of a d d f t f s n a l program a s s i s t - ance could probably have reduced them.. This was in 1957-1959 when t h e r e had been a sudden sharp s h s t i n the foreign exchange s i t u a t i o n and imports of p a r t s and n a r e r i a l s were badly n e e d 4 t o use equgpment i n s t a l l e d in t h e born years through 1956. The Cc3ombian a u t h o r i t i e s were able t o r a i s e program assistance only on rather short t e r n and i n limited slnounts f r a a the ES Ex- Bank and c c M banks, The development e f f o r t kad t o be severely c u t back and ileavi9y concimkrated on conpleting on-going projects, i n p a r t i c u l a r the largest, the Atlantic Railroad. The l a t t e r alone accounted f o r s om e 16X of c o w c e n t r a l Government expendi- t u r e s on Eeonmic Deivefopent i n these t h e e years; disbursements out of B a d loans were heavily concentrated on the railroad, t o the extent of some 66%. Biitfn R i d s i g h t , i a : seems that the should have reconsidered the whole s i t u a t i o n , d e l u d b g its on-going projects, in l i g h t of the total. change i n Golombia's foreign exchange s i t w t b m and prospects between 1955 and 1957; had it done so b t d g h t w e l l have been able t o convince the Colmbians t o agree to cancelfatton of the 1955 railway loan. It i s precllsdy tk seetion s f the Atl.antie RafSroad covered i n t h i s loan which se-s t o have y i e l d 4 partictalarly Pow returns. E l h i m t i o n of t h i s prof - e e t on g r o u d s of budget s t r i n g a e g e s r a i s i n g the opportunity cost of gub- kic c a p i t a l , antk t k coffee p r o b l a d debb; a r t e a r s r a i s i n g the opportu- n i t y cost 04: foreign e x b n g e , would have saved some LrS$3@40 million ewivaleeat sf c a p i t a l e x p d f t u r e over these and l a t e r years and m&ght have l e f t the A t l m t i c M a r o a d y3.ddh-g -re t b n 10% r a r e of return. h b th W B : beeo able t:o cortvert the 1955 loan &atea program loan o r provide additional resources t h i s could have &e an even more useful con- t r i b ~ t i i a ;ft: was j u s t a t " ; h s t h e that protsecriwe policies were adopted i w"ni@h aeeauraged h p r t sarbstittlltion even 5a f i e l d s where the Colozabian rararket was mch toa szaall t o enable cozffptititre efficiency a d which have caused substanrial prablellss s h e ; a v a i l a b i l i t y of addftional unattached forsign exchange resources would h v e =de the case f o r such poficies l e s s presshg and progrm loan negotbtionas d g h t have been able t o develop s m d e r solutiorps. Hans of t h i s was coasMereA a t t h e tie, and the %ink rpaintained m l y a very llttlited relationship with Golmbia f o r several years, s o t h a t in ane sense t h i s is only of h i s t o r i c a l i n t e r e s t ; but i t c l e a r l y has lessons in case of any recurreme of such a situation. tfe knave n z ~ been t a b l e t o identify other s i t u a t i o n s Z n the period under review where i t would c l e a r l y be t r u e to say t h a t distortion, arose i n the develcpent pattert: probably have t h a t these d i s t o r t i o n s e w ~ d been significantly relieved by additional program lending. Serious dis- t o r t i o n s arose in 1963-1965 but these were mainly due t o d e t e r i o r a t i o r ~i n a number of key public agencies, lack of project preparation, f a i l u r e of t h e Planning Deparwnent t o make any r e v i s i o n o f the Plan, and the very serious f f s c a l s h o r t f a l l ; additional lending, unattached and f o r l o c a l currency expenditures, could have eased the l a s t constraint but, even assuming t h a t the other constraints w e r e not binding, a serious question would have a r i s e n vbether t h e Bank was jusrifZed in increasing the foreign debt of a country so l i t t l e willing t o help i t s e l f . After 1965 the situ- a t i o n haproved substantially as a r e s u l t of the technical assistance in s e c t o r a l planning t h a t had been provided, = M y by US AID, i n the interim and t h e i a p z m ~ t t sh a t took place i n fi6ca.I performance, along with the g r e a t l y strengthened r o l e of the National Planning Department. One useful rove has been t o g e t t h e Project L i s t onto a! longer term basis so that i t nuw covers more than t h e current year. Even were important have been tech- n i c a l iaprovements in Government accountiag a d budgeting, so t h a t more accurate figures on expected expenditures ard receipts, etc. a r e available in a more t i r e l y manner. Banlr s t a f f have played a useful r o l e in review- ing the public inwes t e s t h t e s and helping t o maDee them more compre- hensgve. Neverthelesr there remain l a r g e differences between 'Gross' and ' N e t ' ?reject L i s t s aad these d5fferencss are not evenly spread antong sectors; a d the seem t o be true, t b g h LO l e s s e r degree, of public invest- ment plans a s a whole. I n view of t h e sharp f laactuations t h a t have occurred i n resource a v a i l a b i l i t y in the past i:here may w e l l have been a need t o alter t h e composition of develo projects in course of t h e i r execution, t o adjust t h better t o rities. One reason why t h i s has been d i f f i c u l t , a t least on a c o o r d i a a t d basis, is the allsost complete lack of inforsation flows t o the Planning Department on actual project exe- cution and operation. Ifad tk Planning Depar been in a positfon t o propose such adjustments it might still h e d i f f i c u l t i e s from the reluctance of foreign lenders t o change t h e i r projects i n mid-stream. Also there do s eem t o be d i f f i c u l t i e s 9n r a i s i n g foreign f inaslcing f o r particular sectors, such a s public health. But the dorainant reason f o r t h e d i s t o r t i m s f r m Plan that have a r i s e n would seem t o be d i f f f c u l t i e s i n project preparation - greater in sotae f i e l d s than in others other words, uneven i n s t i t u t i o n a l develo -- in d i f f e r e n t sectors. or, i n The c r i t i c a l hportanca of t h e i n s t i t u t i o n a l factor is one reason why we thi* t h a t the would not have contributed more t o Colombian developnent by providing program loans additional to, o r a s a s u b s t i t u t e f o r , i t s project lending. Without the knw1edge derived frau close and d i r e c t association with the i n d i d d u a l borrowers and without the impact a t t h i s l e v e l obtained by project lending, t h e Bank would not have been a b l e t o make the key contribution t h a t it 'has made, i n t h i s respect, f ra t h e areas where it has been involved. A second reason i s t h a t project d i s c i p l i n e a s regards both preparation and implementation of projects i s important i n Colombia a d is recognized t o be s o by Colombians as w e l l a s others. There is a widely acted problem of la& of persistence, p a r t l y r e l a t e d t o frequent p o l i t i c a l change, a d the antidote of project financing is recognized as useful. Third, a f t e r 1965 the B a d had the annual Hemandm of I s d e r s t a d i q a d thus discussed d t h the Govern- w n t any matters t h a t were envisaged as c d i t % o a sf o r a program loan. It is ace clear t h a t the Bank would %rave beem a b l e t o persuade the Colosabian* t o do -re faster -- -- f o r instance t o r a i s e taxes o r devalue the Peso -by concentrating a l l its neptiatiarg e f f o r t s on these matters r a t h e r than spreadimg them between these and project issues. Fourth, a s regards the altemabive p o s s i b i l i t y of a program 1otllaz eesent%-allly channelled t o t h e private sector, sur doubts a b t the efbfciency of allocatkon of past leading t o t M s sector a n G ; a negative I f i d f n b ~ of assoeiat%on between 1-8-tersa c a p i t a l i s l f l r ~ a i s ~ ts o rSae p a h a t e sector and d c ~ ~ e s tp icr i v a t e s a d s s give u s concern, f f p r w m lends- was arot the solutfors there a r e c l e a r l y other s m e s that t h e B a d could t o help tbe IColmbfan a u t h o r i t i e s t o secure a 3 e t t e r pattern of corald r s b -re recogarttion of t h e problennr ob =even i t a d help t o prepare I ~ k r l f ~ m i t i~ dar se s-- such a s i h c o ~ f s i q , t r y , l a b - S n t t w P w e a ~ f c u l t u r a fscbernes, public health, and feeder roads. f t C . O U ~ ~ tmadas a seetor-lending tech- nique i n scsae f i e l d s , h i c h usauld i s e a t with the meti identified e a r l i e r far ratore e ~ t t s r ~ t f o tno sect cy e d i t i s a s , lor instance i n l e n d i q t o idustlry. E t a d d assist the IE)lm%~ W llg~ r - n t f n getting n flows a h & 3ptoJeets under way. A l t b % h the Consults- s have xmt been prepared t o make pledges;, let alone r a r a l t i - ame the Project L i s t =re i n t e t ~ ~ f ~ e l y , acornage the rheatoselves firadgt on idivbdw.1 projects and seek with get a sectorally rsore even pattern s f project assistance, Only i f t h e Bank is m b f e to s b u l d e r the heavier task of project p r e p a r a t i a a d i n s t i t u t i o n a l assbstance kn -re d i f - Z.teuPr areas would sustained pr-m lendizllg seeat an appropriate vehicle f o r its support to W l m b i a ; though b e t t e r than c o n c e n t r a t i s lending on i n s t i t u t i o n s which a r e already r e l a t i v e l y s t r o w , i t would neverthe- l e s s be second best.  T k Bank has played a crucial r o l e i n tbe development of Colmbia's transport sector, Since 1950, it has l e n t a t o t a l of US$2%0.2 million. Bank d i s b u r s e n t s aecslsnt for 9X of t o t a l Inwestan@nltfor h l g h a y s and 29T"= for railways m r t k p e r b d 1951-1969. ]&st these amounts do not r e f l e c t t h e r o l e cf the B a d in helpImg t o improve h f g b a y planning and =lntenanee, 2 ra prmoting, the integration and hiprowement of railway services, and i n rationalizing Gme t transport policy, The Sank s t a r t e d f i m s l e i w transport i'pa~estmnts a s a r e s u l t of the findip%s of tk 1949 General Survey Hissfon, which found the transport system B n very bad c m d f t i m and beyond repair with normal mafntenance procedures. Sfnee then, the Bank bas made eleven loans to the sector, which have been eoracenmaeed on three major projects (Mnex'Tables 2.3 a 3 The f i r s t was the c m s t m c t f o n a d upgrading of the trunk fnPgbay n e t r ~ l t k ,which eo-ets hbe =in gqulahad centers i n the country [six loans d m e IDA cred9t t o t a l l a = US$a35.6 million), The second was the, canstruetnon of t h e Atlantic Bailroad, Erm La Drsrada, m a r B ~ o t a ,to Fadacion, near the port of Qanta %area, a distance oh 632 h s {M1-IPSfor US40.9 m t l k i a ) , The thfrd i s a railway r e h a b i l i t a t i o n pragtm, imludfmg gawis$esa of r o l l i n g stock for the n e w Atlantic Rafl- rrpad, des?ig& t o re a d W e k n f z e the tabIway% r o l l i n g stock a d track ( t h e e loans for USS53.7 million). Construction of the Atlantic WLailr-d was e m p l e t d i n 1968, but t h e other two prsjeieto have been a cam Ewuotas a c t i v i t y since t h e e a r l y a d mid-1950s. The m wL has also p k q e d a c e n t r a l role in promoting a r a t i o n a l approach t o transport planaani- a d pol5cy. P t has tried t o keep an awerall sector perawct5vigre t h r a r s g b t tk l a s t 20 years, although the issw of i n t e titi- has had t o be treated i n a very general way kcamse 06 lack of supportiw data o r seadies. P k Bank proceeded fra the eatPv 1950s w % t R a l%rajor b i g b a y and railway program i n the be- l i e f that roadand ra%Pwere cmplmnraarlr: rather competftiwe modes, a b e l i e f :bat rmafned unchanged until recent years. 4n the l a t e 1950s, when t h e o r i q i r s j e c t s were being cmpleted, the !&ink asked rhe ColmbZans t o ssfon a fresh study oh the sector .A1 This very eamtBawhfHe s t u d y served as a basis for the idenEiEication of n e w pro- jects b u t , more importantly, provgded the franawork for a transport policy a k e d a t attafwiing a workable level of transport cmrdfnatian. - l/ RepvblPc of Cralmbia, Hinisrry of Pub1f c Works: "Plan for s Katilo;raal Transportation". Prepared by Parsons, H ~ p r o v ~ n n itn Brinckerhoff, Qmde and h g l a s , Bogota, 1961. For the f i r s t t h e , issues such a s the levels of subsidy t o road and r a i l transport ar the tax structure of the tzueltiug industry were explicitly considered in the des- of polbey, " Il k study also proposed the increase i n gasoline taxes and the creation of the Highway F u d , bath of which materialized during the 1968s. FinaPlg, the Bank has a l s o been heavily h 0 1 d i n institutional lopaaent i n Gowe agmcies dealing with tramp-; thds saabf~ctis discussed in Chapter ILS. ColoasbZaes Transport Sector Since 1950 and Baak Participation & l d i a f s transport sector has been pro ly transformed since the early 1950s. The zlnd rag1 networks at that t h e were ebther trade, connecthg each of tk? cBth8 0f W o t a , lega River was the only c e m s t , but wfth serious the dry seas-. 9961 the Atlaa-itbc n Bogota a d the stem @dellin, The e%fsrtra has requfred a cgnsuerdle pr 1% of t o t a l stde b~peamspt, t half sf e n t r a l a t t e r proport ion or efforts were made t o ccrapplete the Atfaatge h i l r d d the t A s a coase of those! i#er as the oaly d e that i s t m l g m t i the early 2950s lit acc8umted for 4 2 of t o t a l ErrrS@t Tatrle 3 -21, but tr these s were mfnly reg to about 5= of t o t a l atat: increase ba inter- rtzgilonal, d i l t r a - and Iw-cllistance s. The relatfve of riwer transport decreased cslas~lderably(frm 313%to ln of the total between 1951 a d 1966)a& that of the railways declBared sanewhat (from ct of road trans- pert bas been enc rp neduction in rag1 traffic in absolu a1 traff3ic shifts seean 1960s thrsa in later s, the railways lo= the trans of gndmsttial beeao~w of t k i r fitCIPPa* the ~stramctiotnof the a, hrntily l h i t e d few toll f d s were rbtsariptd -5% e k B9Ws k t a more e l a h Jte syeieja d y t of them Govern- m r em saetfa~s assess. ThSs wal-ti011 dm@ z18t of ttagtsport co- 0dfmtfio-n d r d - r a g 1 ssfm fs t b t the actborn fs not sub- stamcIa1 &we df start P w traffic sb%fts rail icQ r d phgt &a'Iterz:p k e da a m m i e t t a f b k mtlrccm. in Ir@)soq c a t m t f o p l in &I-f9 falls clearly blftatkm a d the f i r s t loan. The roads coltered Highway Plan. I a t h e s e c d period, foam 9961 t o the present, the r loans were f o r the constrralction and upgrad-Ing s f limited sections of the tnmk systesa, such a s the Cali-Pspayan and Neiwa-Espla-iaP roads. During the s e e d perid, the concept of a hrgbay progoam loan, such a s the first l o a s *ring the 1958s, was a b a d m d . The new loans were more suited t o B& preference for t i g h t and clearly-defbnied projects, better d ed, c ~ l e t e more e q e d f t i m s l y and t o defined standards. T k roads reappra.irsed here a r e all those ffnaacled with t h e f i r s t three Lams and a l l the roads fimanced with the 1961 ]loan except for taara-%a, Pedregal-'B"=cc, IC&asa I-Fusagasuga end Rio Wegro-%Lp.so -- *ieh cccrrld not 'be reapprafseaed due t o Incomplete data. Costs of the roads f i d with the f i r s t e h e e highway loans e were mch greater t h m origfrmally expected a d fmpPementati~n l much slmer. Gost 5 s r - m ~ -were particularly serious J n tbe early p a r t of i the persd. Table 3.1 shcows the s r & B ~ a l e a t h a t e of kf8ateters t o be cmerd &ad 01costs a d car current e s t h m t e s of actual k i 8 m e t e r s ewered a d costa, far I a d s F f m a e d wffh 43-W, &-CES, l U 4 O a d 295-CO {All casts im 3%8 Pesos: U Q l . 0 0 = Ps, 24.93 - Aetapial AchPaveent Awe, Cast Tc"aL % Overrun in Cost h { W W fs) - cost !=la Ps) per Eastera Pm& Western Trasrtik Trans- verse tJtkr Total a! ftrclud-g 155 h s of .new csrastsuction. - bJ & i n l g ~ o i l d tathe ~ VemzuePana border and i n tbe Atlantfc region. - c j Est-te of project ki1-ters raised by 1953 t o 3,211. - d l A ISn contiqeneqv allcwance brought t o t a l eatjineated cost t o Ps. 499.4 mslfflio~. It was not possible to determine e m t l y w h a t w o r k was done on each link, kt i n genera1 the rods w e r e raised t o substaaxtially hQher standards than originally e d s a g e d , T h i s actcM1ats for a p a r t --how great a part is virtually w o s s i b l e to say -- of the wry large cost overruns expe- rienced; f i n a l costs were i n real terms a mre than three times what was er%imlly envisaged. 'Ehe F i t s t Ughway Plan, orkginally intended a s a tksree-year e s e r g e x y p r o g r a , eventually cmtimsed ten years tbrougb 1961 and i n same respects bepod, What are t h e reasons for t b s e cost werrwns and delays i n con- s t r u c t i m ? The problm of project Befinitgon dards -- pl t b first thr.ee h &karPa --zraipily scope a d stan- y lo9oa. %*beF i r s t H$g7away Plan was an eaer prcgSra, isnd the inftfal 19Sl loan and the two follow- img, were ssaike ubtbmt detailed (?c c ar ewZ=et%a f.easdb%l&ty studies, This af s t a e r d r prsfectfms ems -- Zch zaade pr~Ject la a f ~ i m , rnspgrstision a s well a s cost the Wniseer of PPablic Works pragram as agreed w3tb tire &&, h w i a s g g d t k Ism, he t o b v e reverted t o h i s c s r i g ~ l ,larges prwr.m, wf'th B Q b t c-tmctboa standards a d TQ;L~S* " T b le greatest s % ~ -me of delay was the b b e a g e o f Pesos, due to diff%culltSesi a rags- tams, a very large h9gkay program, a d LStgZrr f% any all-ace fer i t f k t r m in east w t h g c s . A s a r e s u l t , the H h f s s t - was: amble ta carry mat the projects pn pseBeduPe or to pay ~mtra3cZ~rs 0s t&ae. &fcb tam rem'bted 5n c a r a c t o r bankruptcies, a m s e of e q u i ~ a t , a d frf6JtZans kweea the BmL and hI&%an azathoritfas. Pt also amravat& the x g l a c t of proper mgntenance, corm rectLm s f *feh was me of r2w aajior a h s of t b loam. A seed @if~ibjl= was pb G ~ f a b i a ~y~s i a f emiro-nt. The Pamrfsl%des, wash~ttasa d ?a terragn p r e e n e d vagar.iea wfaf ch inith11y mda ac;custlte s f CWLS and ea~ap3,etia dates very b h n emiromfzt, and cast est%mtes 6 mre accurate, h t saature still causes Tntgh recoastrucrirjs and 3s9i.astena11~e cosrs. ThfrbPy, the organization and prlacedures of ehe Hinistry of Public Works were a proble~lr t h r m g h ~ t the kzistory of the hi-ay loans, Par- t icu'larEy udcr t & early ferns, tire Xiraistry8s rs- acirrzinfstra- t h e syst-, as wefZ as its poor h d g e t i q , led to frequent delays in payments to coatractors. Substantial &lags were also caused by the' lcraab- l a w that dl Gmr-nt contracts be signed of o f f i s h l s , a problem that Bg6 k e n solwed only re- Znsietexwe, ta Z. The dete- d Gal-&a due to the e crssis held a year between 1955 a d 19% a d was a major mcy s b r t a g e o . fa l h f L & atrrd the -clasfm h i d fim St 5x1 tB&s regard s b f d Be eassi&.re8 idfcratfm. Qbay project 8 prmetS to be, srr ts. The average gas@-l rage of t sav-8 but m e t i a s tbt were b d % v f d ~ ~ i l l y 5 omlyrss?d, fs 2.a ( T d 1 e 3-21, a& rail could change the results for same of the roads, hit seemingly not =ch. Finally, w did not attribute the %ncrease h average truck size that l h as t Zace in the last 20 years &a -- m 5.5 to 7.0 toms awed bighays; bad =I dome so, the project even U g h , she@ the l trucks permit aperatSmg costs sf Pa. of the roadls s b a = r g h a T m the sense that minor retPlm, 5 rqe. These r d s are Sant of Cali-Popayarn), sfa, Gararta-cuta ad -Baacbosa, Sewerah actors elqplaba rt-he w i d e dSffezeaces in return among the rate of traffic is tlsat be- -ralt;faa! costs a d CrDStS h arve bread cost tedulctf- b e rll- cmi&raBly, mr&ct$om in ~ p e at- w t a bog! Bna part ken passed cnn t o tke truck users t k ftfbsn. Time sa.\tbws were s b s t c q l e t e l y alas services . - lb casts be defineci as ebe *b%tbg" ffe 2) B vehicle opera- s i t m t ions, The latter is d to repre the situaticm had the road Ilot b e m built. h a d =f;tpt-~e a s t s in the '"io situaPicra are stam&,bat d i c h sptirattfag co txse of deterioratiag cod-itbfls. It i s not clear how far truck users (usually cia1 middlemen) have in turn passed ost s a w i q s t o producers a d consumers. The mar- keting process s to absorb a large proportion of the t o t a l price of g o d s and there is soate evidence that the spread of ses better access reduced the iary levels in t h g st21aeture and increased prodEuctis8 reee%vinga higher Because of the nature of tbe f g r s t three M@aay Isans, no forecasts of i c a r e m i l a b l e for c q a r i s ~ ~ with the ae-1 reasmas, no return were icalcu- lated on those r raPsal. The estimates made of a firs: year r a t e of return for the roads f wPth the 1961 loan p ~ o i v dt o 'have accurate in swss cases, as the Neiva-EspinaB road, 00 stic in others, mcb as +opaym. Although t h e BUgg- entura road was not m p p r d e d iaP this study, the p a r t i a l cost esrfaatzces a\r~lflspble, &e very long eonstmtfona perid opened to t r a f f f c only at tihe d of 1978 -- -- it was and the r e s u l t s of other rtlads all s a e g t that its jElata1 retarn w&ll 'be 1 , - a t an accelerated B e i q o r t s . Thls ln- ts tm d the Cmerhment as- i n the c~:01tpa.f~ s were c - i k e d Pate 19%~. 'Phb? Bigbag sfam242tds were not -ly*d in &tab1 fn thPs evaluation, arrd tlbe r e s u l t s oE apply&= the h st that om a few rcmds, B a n c d y b@ i d b a t f l t e sf the ffntagced . with the 1961 loan, t-rtacks were aot able to full use of the higher s we aean here aspects such a s w i d t h of h e , type of curves, gradients accepted a d sight dbstance. Other technical variable;, such a s - of base a& pav-nt, nd;ra5mage, etc., are not considered. standards because tkey could nst attain e k high speeds allowed by the ~llrvroads, In one case (a recently-opened section beheen Bogota and Girardot) truck drivers stilt prefer at present to use the old road; the new road has a stall toll, but tpp1ckers also Zdicate its design (long, slow gradieat) as one of the maZn reasons for aoe using it. P e, application of the d e l st& that only a small pro- P the theoretical capacity of roads is lScely to be used even at the end sf ttseir ec c tbfetime. wh2cki cornpsise &ed from countries be a key factor in highway de- at present, a r&s, -reas fr tl.st@ mw-s. y , the country's topo- graph mks f &Id soadas which clan btt cosds cf deasigwd for 126)h per Plsur zxe nzst m e than those wit31 80 b per hour &sign. But the mtter m d s atteaion. "rtne issue of deb- tkr p s f n t , Aich is the need f i r a ~o;per hhw isl bdrastmcture and in s i s tuas ka ;ta tgpe of vehicle bazaarced cum'tpina- ably, h o t k r 2s- that desrtrves attent5on is the interrelation between t h*&ays and se ry and feeder roads, The appaPLfng c o d i t i o n - 11 The Ec take~ cs a d Transprtatbm Projects Be s have under- a m j o r seudp en Psimay design standards that wsll surely clarify of these p~Ints, of tfae trunk system i n the early 1950s and the clear need t o complete it =ant that amst available funds a t tbe t h e were concentrated on t h i s task. Also the baiance between tar& and feeder roads was unfor- tunately confused with tbe issue of excessive dispersion of funds i n many projects; concentration on a few projects became synonymous with concentration oa the trunk systes. Althmgh the Bank's insistence on t h i s approacL .linthated projects that were probably uneconmic, L t had the negative side effect of reducing the e f f o r t put into E-eeder and penetration roads. Feeder road construction was speeded up i n the 1960s by Caeaixms Vecinales, a agency, azld the UIB has f i - nanced p a r t of the expansion in secondary ancl feeder r o d construction t h a t has taken place i n recent years; 11,500 Ecms of secondary and feed- e r roads were constructed and reconstructed between 1953 and 1969. Hevertheless, our studies suggest t h a t Lack of secmdary and feeder roads is s t i l l a major transpott bottleneck --which ts not to say, of course, that there are aot saae deficiencies matstanding i n a few sec- tions of ttse trunk netuork. The issue of feeder rods is related t o the devel raad ipprovements. The Bank never considered t h i s type appraisals i n a f -1 way. Our studies on t h i s aspect suggest wide variations fn the tk~410paenttimpact of the different roads. The Cali- Popayan road played a rninor role in iniauc%ng new a c t i v i t i e s din the re- gion adjacent t o it, although it helped f n the integration of agticul- the tracatr of Valle, Cauca 9nd Narino. The road 30% Oillavicencio is unclear . The increased p on fn the region centered i n Villavfcencio appears more related t o feeder road h p r nts in the region thm t o the upgrading of t h e highway t o Bogota, and the transport cost between Bogota iPnd Villavicencio is i n any case a minor part of the t o t a l producer-consumer transport cost. The new road be- tween W e l l i n and Carragem did have a m j o r inpact i n the development of the regicm atwd Caucash and helped t o open up large areas slif t able for c a t t l e raising. Other case se~tdtes, focussed on sllnall t a m s , sug-* gested that the developa!ent impact of the t roads on those towns was minor, and i n soae instances negative, mainly because smny econmic a c t i v i t i e s previously located there moved elsewhere and developntent of new ones t o replace thesa was l h i t e d . B e A t l a n t i c Railroad Coslstruccion of t h e A t l a n t i c Railroad is t h e ~1osZfmportantsing8e t r a n s p o r t inwestment finaneed by t h e Bank i n Colombia. T wo lozns were k;ade f o r t h i s purpose, i n 1952 f o r t h e s e c t i o n between La Dorada a d G a m m a , and i n 1955 f o r the s e c t i o n bemeen Sawrrs and Fundacion, with r e h a b i l i t a t i o n Fundaeion-Santa Harta (see -map). The i n i t i a l purpose was to connect t h e Bogota and MedeSLin regfans w i t \ each other and a l s o with the p o r t of Gmaraa, on t h e Magdalena River, eliminating t h e navigation- a l pr&le= presented by t h e r i v e % solnth of G a a r r a . Addi2%onal pur- poses were t o join the o l d Easirern and Western 3 a Z l Systems and t o c r e a i e t h e esdnditiom f o r -=i viable, f i n a n c i a l l y sound national ra2Pway tarertaking. I an 1955, it was decided to exzend the liine 4.0 Fun6acion and h a w an all-rai3 connection t o t h e A t l a a t i c coast. The decision ko buf2d t h i s raf lroad was a l s o based on t h e ffndizzgs af t h e 1949 General Survey Kssim, d f c h rec n d d the tors t r u c t i o n t o G a r r a , Xm doing t h i s , =he Nfsrbon helped t o k i l l other very ex- pnsi-ste c c s n s t ~ ~ c t i o plans, n p a r t i c a l a r l y ego Sinaks t9arc.tg'n the mountaizas, ane [Iizasye-A-nia) t o join the Eastern and Nestern Systems and t h e cather separately v i a Bucar ga t o l i n k the h a a n d s y s t e m with the coast. mese c l e a r l y would have been major a f s t a b s because of engineer- 2118 problems and the hi@ r e s t s 5liaobved. The 572 b r a i l r o s d took e-iehr years t o bubld, cmpared t o f i v e years ar.iigbnally e s t m t a d , and c o s t m$98 milliix ~iqajZvalenit, 70% more than &at calculated (Amex T a b l e 3.37). The Qwerruw was almost en- tfrely on the Peso elemer?4:, on &fch it w a 160%. I f we take i n t o ac- count that a f t e r 1961, *en it was xEficZa8lg fnzrugursted, coraatruction continxacd u a t a l 1 %8, e s p e c i a l l y b a l l a s t i n g and the sehahB8-itati.sn of the 91d l i n e b e t e e n Fundacion a d S m t a k t a , t h e t o t a l c o s t goes up t o US$Bl16 aillion equivalent (Annex Table 3-13 and the t o t a l overrun t o 98%. Nost 3% tbe &Bays and c o s t owrrtms were caused by t h e e x t r a work and modifications requfred ir, t h e seetim beweern L a Dlorada and Gmarrs, The major flaw was proeeedfng wdth rhe i n i t i a l , Porn on t h e +,asisof only an a e r i a l survey which was not s o r r o b ~ r a t e don t h e ground t o indicate t h e E r n e nature of t h e t e r r a i n , Other ftecRniczaP psobl- also raised costs. For instance, eartit m a v i q rost s were g r e a t l y a n d e r e s t h a t e d t'hrcughrsar !h-x;cx Table 3 , 3 ) , Pidwinistrarive expenses, whichproved t o be c=nsii:erztnle, were not atlowed f o r in t h e orig5aai est-tes.  The Bank bars part of the responsfbility f o r proceeding with a project based on poor cost estimates. Responsibility f o r overruns and delays s t e w a l s o f r m the Bank's close reliance upon, and support o f , t h e general consultants t o the Cololnblan National Railways (CNR). CNR and t h e consultants (Xadigan-Byland) were often i n c o ~ ifi c t , and lthe consultants were t o same extent considered an arm of the Bank. This had deleterious e f f e c t s not only because of the damase j.t did t o the normally d e l i c a t e client-consultant r e l a t i o n s but a l s o because the poor judgment and performance of t h e consultants were a major cause of the slow execution of the project, Other factors were a l s o signiflcanr, such as administrative pro- b l a m during construction, d i f f i c u l t i e s i n the provision of Local funds, f a i l u r e s of sosle contractors and, last but not least, the p o l i t i c a l t u r - m o i l in t k country, especially i n the raglan where tLue railroad was being built. The construction of the Atlantic Railroad was a most pain- f u l and lengthy process. The main coaeeptual. problem in ana'lpzhg the railway's ex-post fea- s i b i l i t y waq t o define reasonable courses of action had the railway not been built. In t h e end, two main alternatives -were tested, one based on the possPbility of using highway transport, especially the Bogota-Santa W t a and Hedellin-Cartageaa roads, and tbe other b;rsed o n1 the possibi- l i t y of using waterway transport (the PLagdalena River). The highway transport a l t e r n a t i v e was -iced out i n great d e t a i l , specifying possi- b l e routes f o r a l l t r a f f i c usiw the Atlantic Railroad. T Be waterway l a l t e r n a t i v e w a s analyzed i n a -re simplified way, since the railway and r i v e r are p r a c t i c a l i y p a r a l l e l and correspond t o exactly the same transport corridor. For t h i s last reason, the waterway alrierrrative w a s a l s o used t o evaluate individual sections of tb railway. The benefits were defined as savings i n d i r e c t transport costs a t - t r i b u t a b l e t o the new railway, e l i s i n a t i o n of the need f o r trat;sshipment frora waterway t o railway o r highway, tiate savings and reduction of losses. It was a l s o assused t h a t a l l passenger t r a f f i c was induced t r a f f i c , e n t i r e l y a t t r i h t a b l e t o the railway. We made three s e t s of calculations of the internal r a t e of return, i n order t o test: the range i n which it zaay f a l l . The f i r s t set zssrsleet r e a l i s t i c conditions i n roads and waLerways, t h a t is, representing the operatdng conditions of these modes i n the last t e n years, but assut~itlgt h a t the waterway would remain open aPZ pear r o u d . A second s e t implied thzt the w a t e r - . v;r p would be closed f o r a f e w ~ e e k s ;t h e impace of t h i s closure was quan- t i f i e d by assigning a monetary value t o the t h e sawings. F i i ~ a l l y ,a t h i r d set of callcnlafions was made assuming increasingly d e t e r i o r a t i n g conditions i n b i g b a y s ztnd waterways. The f i r s r set sf calculations r e s u l t e d negattve r a t e s or' r e t u r n i n a l l cases, as s i n Table 3.3. fltho~~g h even these cases a r e t o wine extent weighted i n favor of khe r a i l r o a d ( f o r instance by a t t r i b u - t i n g a high value t o t i m e sav5ngsj t h e cmparbsans with the waterway a r e unrealisCic inaso2ax as the waternay is no~maZlyclosed f o r a few weeks each year. On the other had, t h e second s e t cf calculations, explicht- Z y a P P e n g for tthis am13 indicating a rate of r e t u r n of 3.77, f o r t h e whole raiProad, exaggerate the yield of tke fnvesment insofar as high- way a l t e r a t i v e routes have exfsted s i n c e the P a t e 3195(9s, before the raflway l i n e came i n t o full operation. Table 3.3 Internal mte af Return of the A-tlaatie laatlroad Initial Assuming waterway calrillaeion: bsmiaajg closed p a r t of t h e high- m t e ~ z y year and deterio- way c s d Z k i o a s C~OS& tions r a t i n g con&% and waternay part of i n waterway and the year hTglxway transpsr t Z % mabe intlaatfe Railroad (La Dorada-FundacSon)  . The t h i r d set of calculations indicates t h a t the return of the Atlantic Railroad w i l l inst rise over 10% even rai3der the most favorafale a s s ~ ~ i p - ~ * o n s . The analyzes shew t h a t the seetlon between La h r a d a and Buerto L: Bertio probably fnad the higbest r e t u r n 2a t h e whole railroad, Another calculation of tbx? IBR using t h e e s t h a t e d instead of t h e actual con- s t r u c t i o n cost, but actual t r a f f i c and rail operating costs, gave a £1- mre of 9,955, as empared with the 3 .7% actual c i t e d above, These r e s u l t s b v e t o be interpreted with caution, The decision lin 1951 was t o proceed w i t h tbe Atlantic Railroad, part of the Eastern Tm* Wad (wota-hear ) and the W&?llbn-Carta,geaa road W i r h is an alternnatgwe t o the A t l a n t i s .%ilroad for the t r a f f i c with o r i g i n maf fm gn %Be&llin) smltaseopssly. la the 1930s a d 1960s the nt cmeim~ppsly upwa&d t h e kgota-Santa Marta road. T r a f f i c e v o l u t i m in hfte last 20 years scgf~ests &at t k Bogota-Atlantic coast corriotsr dfd no5 w w m t m e s m n t in both r of tk t r a f f i c oa the A t l a a o t i c 32aiPr-d could rag jiways . Most e i t h e r on the one was, then, s u p e r f l u a s ? If ~ g l t ?la* a t ehg iateanal rates of return, it seems t h a t it was the railway Bhnt 838 t h i f c a l c u l a t i s n of the ralil"kiapSs re- turn, we bme s s w d t-hak tbe hf@wbf~ w a P d ham? been built anyway. Bad the dec.isfo;tl in 1941 been 20 bazfld L b rabPway only, t r a f f i c would b m beten h 9ad Pts ccleurtmetioxl J u s t i f i e d {although this course of a c t isa w a % a l s o @ l i e d a mcb larger re"n&ilftation program; the railway at: t i m a Fpzire1y bees able t o axawe the t r a f f i c t h a t has been o f %ere& to it), Oar essicrnr is !&at the hfghways wets j u s t i f i e d largely btrcillusse sf:t h e Brac raffic, espuecfally fxn the Bogota-Bucara- sectiom. Gfven this fact, and the nature sf other road invest- ro, &.lcIB also c t a e c t e d Wgura ?;ftb r k Pacific coast, i t seems, with bindsi&t, t h a t t h e right b e i s i o n i n 1959 would haPe been t o psc- ceed with t k mad and not tthe railway cowtructbm, kt t h i s cannot be p r m d cmc Pats lively, I n terms of tore d i r e c t eq131~atie~18, the lew returns seem t o have -been caused by a carsnlbiniiitian of three factors: f f r s t , the very high con- s t r u c t i o n cost mrrures and 1 - gestation pergod; second, CM'R's low c ) ~ r a r & gefficgeacp, *icb has kept rail operating costs at high levels; f h l l p , t h e rel;rtiwelp 1- r r a f f i r vol*mes. Freight t r a f f i c has in- creased, bur passenger t r a f f i c has decIined sbap'ly since 1961-1962.  The Atlantic Railroad had an haportant impact on the development of ehe Hagdalena Valley, Tfie railway was Pnstrfnnenta1, ;even during i t s construction, i n open* up the valley and providing new areas of settle=at. 3% colonization process was s p o n t a e m s and had a high s o c i a l cost i n t e n s of the l i v i n g cospditi~ns of the colonizers and i n term of a widespread =isuse uf t h e region's natural resources. Never- theless, same increases i n agrdcultural productfon took place i n the region t h a t are k p r t a n t f r m the v i e w p i n t of the foodstuffs supply a t the national Leael; these increases relate zaainPy to ~ f c e , corn and tim, "$ire r a i l r o a d a l s o helped $n proxaoting the strong o t t o a p z d u c t l m i n the Cesar Valley. T Be -in ccaceptual t prolblesa is t o detezmine ts what extent those increases can be a t t r i b u - ted t& the & l a t i c Railroad only or t o o t b r factors, such as the in- fluence of r-at a s i c u l t u r a l agencies o r dennand pressures, Ann additi m ah ulationa a L l w i q as benefit the v a h e added by the in- creases i n r k e a d corn prerrkuction, kvelo-nts tbat could be more or less s a f e l y attrgbuted t o the raflroad, 4considering a l s o the addi- tfcmmal &=fit .just m n t f m e d of iajl all-year connection due t o the r a i l - road (with wareway a s alterxratSve), r a i s e s the I= f r m 3.7% t o 6.6%. Ulwhg f o r tkse devel e t a 1 benefits, the related developmental costa %a taie reg&- t h e sellsft2vity analyses for railway operations t t t w e l v e s deserxkd earlier, su+ f i n a l m ress c i ag is t h a t the Atlantic E t a d l r ~ dprobably had a p s 5 & i v e , but very 1 - retun., scarewhere be- rmen Bjt a d 5%. By the Bank o r &he C o l d a a n Goverament of E q l t c i t c%lr~s+,dr?ratien tke railway's regroml -act d g h t have i ~ r e a s e dthe benefits of the project a d orher regi-1 i n v e s w n t s , a d r e h e d the s o c i a l cost of the coloafeatiosr process, The lgnk 2dicrs;ted Z n -she appraisal f o r the %i,rstlam t h a t b;nild%ag a hi-ay mi&z be the proper solution i f the task were the d e m l q e s n 2 of the -dale= Valley% agricultural re- saurces. but it considered a t t'ble t3se t h a t t h e tree problem was t o pro- vide G o l d i s w i t h a thrm$Z%a-rate f o r her foreign trade, Tbe Atlantic Railroad had I h i t e d h p a c t i n wmeckion with its two other origiftal purposes. The bsabldling of a fisrancially autonmws and well-rm corporation was one of the key aims of the Ba~dc. Wowever, CHR is s t i l l nor a financially viable udextaking and there is considerable r o m for operatgoml iarprov-nts (see C b p t e r IX), The integration of the Western a d Eastern S y s t a fiad a minor gapact on t r a f f i c . In 1966, only 8.8% of r a i l freight traffic a d 3,4X of passenger t r a f f i c were move- ments between t h e e**o old systems. ~ a i l w &Rehabilitation Prwr%"ga i rehabilitate a d aad upgrading of the a serious reha- t l y lclequ&redequipment because of snlly wftb the 1963 amd 196-8 31om.s. The evaluation st* reapprafsed the imes s t h a t took place betwee= 1958 aaad 1968. Total izt~fles-as ted t o kB.$7O million eqa ivalent, n0s the atems % t h e pro all into f a t categoshs: d i s s e l s &st t o replace old steam engiaes; acqufaftfcm of r o l l - b g stock, m h l y fmQht cars; %ti- of shop e q u i m a t ; and a v a s t t r e k re--at gr9-m [see Table 3.81, Ttae q u a l i t y of t4he d a t a m costs a d amtsazetilon ocbedules does not pe-t us t o c-ae - t w e e d asPc3 erettaal figures, h e x TabXe 3-4 riza mMiPftatioa m d i t u e s year-by-year, Local expenditures sa s'neps arond track r e h a i l fsn for t h i s perid s a t t o B S 3 0 mfl- Ifma squfwslent, 0-f the fcsre;igga ax& casts of tbe program, 73% were used for r o l l % % s t ~ a k~ q e t b i e % t i m , The r e h 9 b i l i t a t i m was also regppraised with the help of '2ts use p9mitted a better quantfffcation st- e f f e c t s of m zmalygfs of operating condi- m n t s and a tions ia d i f f e r e n t p a r t s of the 4letmrt amd f o r d i f f e r e n t types of ser- vices, As t a h i w a y s , the d e f r e s u l t s about & t a i l e d operattoaal con- d i t i o n s are only indicative, I n order to d t a i n ex-past kadtegpal r a t e o£ return f o r rhis t e - k a b i l i t a t i m pro%;rm, several m s q t i a bad to be nude, in l i g h t of w a i l a b l e data, about the e v o l u t i m oB raffway operating conditkons without the reb&&ilStatiorrprowaa; we? zrss-d a pr.og;reesive dekesiora- tion. m e resulting 2rrtemal r a t e of returns fs f o r the whole rehabi- l i t a t i o n prograa, d 6% i f a sbd- foreign ezkrupge r a t e is wed. h  attesapt was made t o estimece tbe return of ttae investment components separately, but t h i s cannot always be done? because several components gznerate t h e sgae kind o? isapacz, and it is s s i b l e t o separate the influence of each of theat. Po le, 'bath the new d i e s e l s and the t r a c k renewal program h an on operating speed, A calculatian of t h e r e t u r n on t h e dieselizatiosl program, d t h o u t considering tbe t r a c k reaewal progrim, showed au TMt of l a ,but only 6% If a shadow exchange r a t e is used. The estimate made i n the appraisal, of a r e t u r n of 16%, proved too o p t m s t i c . Several additioaal calculations were made t o test the s e n s i t i v i t y of the r e s u l t s t o changes in some of t h e assimptioas, such as the econaaic l i f e sf t h e 5azvestments and the evs- l u t i m of the benefits a tr :r 1970. The g ~ a l y s e s indicate t h a t the ge- -. neral coaclusioa, that the r e h a b i l i t a t i o n program has had a r e l a t i v e l y law return, would r d, althmgb the actual IBR may be s l i g h t l y different, Three factors appear t o be the must a t f a accounting f o r these r e s u l t s , The f i r s t is the iaeff ic that the railway hae made of t h e aew imt~?streats, which hss oresnt that part o E t h e i r poten- l t i a l benefits have not r a t e r i a l i t e d , The Whole re;habilitatioa package should have had a s i g n i f i c a n t t on c e r t a i n operational character i- s t i e s . The appraisal report indicated tbt: f l reaewals would reduce t h e P of 1-r aminte of way expense, h - i t y of service, pewit the t ~ s eof heavier a d f a s t e r f r e i g h t t r a t n s , which viozntd -rove ef- t r a f f i c . The new f r e i g h t cars *would of over-age, obsolete ears a cw in r e of equipment expense, and increase s would p1paft a greater volume of t r a f f i c t o be Unfortunately, those operational characteristics have remained largely unchanged o r 'Rave h p r m d very 1137, m i n l y because of nt problems. The only benefits t h t e r i a l i z e d are d i r e c i n operating costs derived, f o r l e , f r a a replacing several old s t e m engines with onrt new diesel. Inadequate track maintenance has been a constant probleta thruughout the 1950s and 196;0s. - 11 Loan 34340, Appraisal Reprt, page 25.  R a i l w a y reWi1itatioi-i hvestsents e r e w e l l conceived and the Bank presumed that they varld be uell used, but it never specified, i n t e r n s of operational targets, vhat a "goodN use of the investments ==.at and, more h p e r t a n t l y , never supemised i n d e t a i l what was being date with them. Baals. appraisal d supervision work had a heavy bias toward finrrncial aspects was seriously concerned about those problems that construction delays and paor overall financial a6aeures t o help deal with them, as described ia se steps appear t o and name of t b get t o the heart of the problem of operati u l t a n t technical e f f o r t was s t a r t e d i n 1965 vbea S t o -work on t r a f f i c costs and in f~~rlrshops, track r e h a b i l i t a - perations c ~ u l t a a t s was a c o d i t i o n of t b e 1968 locn re was same i n i t i a l reluc- tance on C HR's part but a f t e r cmtiwbed ijlgistencc by the Bank, the coa- s u l t m t s f i n a l l y s t a r t e d worlsin& in e a r l y 1971. Selected technical per- formance indicators are givea in Table 9-1. Although in8 q u i t e f with other railways i n America aab sh igas of iaa- P in some eeaer, they f a r frun ideal. The s e e d f a c t o r is the low t r a f f i c level d f t s slow growth. Although f r e i g h t t r a f f i c has tradf i c has declined very sharply m d the t o t a l is , Th2s trend is i n part expxairied by m's poor quality of service, another r e f l e c t i o n of -- its lat operational efffciency, even wftb Ereight, the m l y sections r e a l l y growing are the Atlantic Bailr& althatgh its growth has ten- -- ded t o become! d l e t a f t e r the big iac es bn the e a r l y and mid-1960s aad the line betweea C a l i atnd Buenaventun, b the r e s t of the sys- tem, freight t r a f f i c has decliaard. reason vhy the railway has kept its posttian i n the & l a t i c a & Cali-henawznt~rasections is the lack of p a r a l l e l f i r s t c l a s s highways. The s p c n h g of t h e Buenaventura-Buga ( C a l i ) road w i l l have a pajor %mpac:t oa r a i l t r a f f i c in t h a t region. A t h i r d reason f a r t h e low return is tb delay in completing p a r t s of the r e h a b i l i t a t i a n program, M t e r a l l , there is a c e r t a i n balcaace t h a t must he rmfnteined. To btap sew diesels without raewiug the track so that the locawtiwes could be used a t m adequate speed generates l o w returns on the diesels, Certain parts of t h e program were delayed for a v s r i e t g of reasons: inadequate planning, lack of funds, d m g e t o e p i p n t in transit, p r q u a l i t y of r a i l s supplied, landslides, admi- * n i s t t a t i v e d i f f i c u l t i e s . P l y of t b e s s f a c t o r s r e f l e c t t h e same baeLr g r o b l e discussed abawe. In t h i s evaluation, w e did not t of the: r e h a b i l i t a t i o n priogr- on derailmeats or , because it was sib19 to determine whether, for ints wai1d have 'be g k r o r lower fn t h e '"without inves-sntaa s s i t m t f m , or to obtajina accurate + n f o ~ t f o n about types of derail=mts, tbeir l a c a t f a n or t be jk r cose, & of ehe c r x ~ c e e d e f f e c t s of t r a p r e b p r o v m e n t s was inteilgra- t i m cud the ma&m r e g i o m bn C o l d r i a witb one another, This impact was aas~sred tlhroua iatematim Baadfces, & a w e d f o r t h i s study on the b a g s af &be: pls5aeipZes s f i n t e r n t i - 2 (m 8 i n c e m i e g i m 1 ) t r a d e thelo- i q l h l y s i s of the agr.iieu8tanse d Pfviorst~ks e c t o r s f o r t h e 1955-19169 p r f d strowglp s u m a r t s the b f p t h e s S s of a n t r o w a d natLonzrl atfam, The D e p n r m a a s have tieasbd to spec5aIier in a c e r t a i n af er@psaa d t k mtf-l prduchion. s f each crop has tearled t o eemrratedSa b m r W p a r m n t s . Cranfimfng ;that r e s u l t , evbdence fta f m d of a sieiffcslmrt t r e a d tmgptd p r i c e erquallmtion among regions f a a g e c u l t u r a l p r d u c t s . h t h e r e s w p r f e f ~r e s u l t s were found i n the =@a of i & s s r i a I p n r d m t f m . Host rinduskrbal grmps, facILud6ng tex- t%3kes, e E ~ t R f q ,EeipmEture md e l e c t r i c a l @ -% -;at, show a t r e n d toward be expect& % - -rm-la~t in n&catbons maon8 t h e regionsad ehe awailabilfey erf s c d c wmfkzs in many- i n d u s t r i a l a c t i v i t i e s , kt apwaers t h a t s - of the wc3td~idfng factors in lererxnhkng in- are r e g f m a l &neerests a d a long t r a d f t i o n of iade- &&;trial Pwafio~, v n & n t regi0-E &eve1 . Each region wants to itsdiast~iei1ize, and all Wwrmenrs try to b w e all kfads of iraWtr&es,in&gp?endewr of any fsatssaible natio-l s t r a t e - for i d u s t r i a l i t a e i m . 'BSfth r e g i e n a l prcs- sures for fnhtr3Lalfzr-&egan playing s u b aa i m p ~ s t t m tr o l e , the reduc- t % o m lie t r m p r t e w e s *=it t h e m v e r a t a E raw a t e r i a l s frm morc t b i s t m t places aIld cepable 9 - ineI;ustries to locate c l o s e r t o t h e i r m ar- kets. aJ4pmwerseQya t b f s k i d of reg%-P pressure seldm e x i s t s Zn rela- t i o n t o ~ r i c u l l t u r e lproduritiaaa, =d the sectox was free t o respond t o t h e new p a t t e r n of fneelat6ves brought by t b e redsrct%asn i n t r a n s p o r t costs, W e t w e have not kea able to establbsb is whether the trend to- ward regiaseal di.spersificatim tn bdust'p~7 i s i n f a c t i n e f f i c i e n t , even ehouglili we staspect 5% may be.  The evidence suggests t h a t transport played a s i g n i f i c a n t r o l e in t h e process of nat%onal i n t e g r a t f m i n agriculture and of regional d i - versification i a Lndustry, although t h i s r o l e seems t o have been i n d i f - f e r e n t directfons Eor each, M o s t of the linereased i n t e r - and i n t r a - reglawal trade a d contacts were sawed by the h p r o v m e n t s in road transport. m e r o l e of t h e railways in the integration of the reggons centered irn C a l i , Medellizm a d Bogota was negligfble. The main develop- t *act of t h e railways was to htegsate the &Bmt fc regf on more closely with Mgota ad, to a lesser extent, d t h F k d e l l h . addgtiosal of 8eweBom~eor integration impact are worth m n t i m d w . Fi t h e r e is evidence t b a t better transport has 'liaelped kas increase the awa%lab%lfty of i s p o r t s thrsmghrawt the country. m c h l a r g e r share US tstal ts. Biovertre~, exports do not seem t o baars k e n affect&, E v r ginratbg .near the s o m t a r e now r e l a - tL1pe1y reant t b t e m y years ago, Betabled studies of a few &m & k f rd e v e l o ~ n t . S e c d l y , b e t t e r gi-1 at ions bye k 8 p b t o bre& regi-1 $solatfa ~ o p l e a r e of ehe p s s i b i l f t&es oS hter-regi-H trade d coacacts, although fh i s e f f e c t c a a o l t be ~99.aLffied. dZmkSs ac& ts %a b e l g i w to hiprm-e Co3 &5a's transport s e c t o r a r e b p ~ s s i v c ,bus anrlgen. After t w e 1 S j years of Bank p a r t f c i - p a t i = the c a n t has ~ m slmst c w l a t e hmmilt hi-ay a r system and an itntevaear3t rail -st- operated zs me anglert&gng. B k a process of FraxsWrt hprov-tmr has had bath go;ftiw asad negative aspects. h i g h a y s 3r.o)~-figag~sedby c k Bank up t o 1968 p r m d t o be highly successful, MtEa most: of tlrs to& sbaw5ng a very high return. B i g b a y p f m m t q has been g r e a t l y q r t m e d , and the Minsiatry ~f Public Works is naw b e t t e r pepaxed t o handle ~ompBex higl~vayprojects. On the r a i l w a y s , althmgts t h e c r e a t b n of CHEt jin 1954, at Bank dne;istence, and t h e m i f b c a t i o n of a l l r a i l ogctratiotls undies it was a useful measure, the Invesmlmr. progrm has hadi d u b i a s itesules. The Atlantic Railroad showed a very 1-d retux= g;2d t h e s i z a b l e resoiar-ces w e d i n r e h a b i l l t a t i o n pro- duced margi=al r e t o n s . If the d e v e l o p s t impact of these investments is taken i n t o account, the success of t h e highway investments and the low return of t h e railway projects becane more accentuated, Highways were the r e a l promoters of national integration and some of them seem t o have bad an important impact 5m t h e regions adjacent t o them, W hy w e r e t h e higInsag investments more successful than those i n railways? What was t h e B d ' s r o l e in these r e s u l t s ? To s t a r t with, there is an engineering angle t o the problem. Highways are technically an e a s i e r traaspart Colombia is def high gradients, . i n mountainous t e r r a i n than railways, and Bailway costs increase sharply with i v e conditions good equipment, high of them -- operating e f f i c are required t o -- all three, and not one o r two railway operations profitable. A central issue has beera traasport ooardiaatioa ead the evolution of road- rail coppetition. As regards t h e inveg s in the Bogota- S m t a Marta corridor (the t i c Railroad and the Eastern Trunk Road), t h e c r i t i c a l d@cisicm was in 195'1 t o proceed with both road and r a i l irntestrent programs, t a i l e d engiaeering study of the Atlantic Railroad would probabl s e t t l e d the issue L n favor of the highway program, but we carmot prave this. Ikiplicatioa of f a c i l i t i e s seem6 t o haPe occurred a l s o in other re le, between Cali aad Hedellin. &t once t h e i ~ t p t r n t s dination becomes the -st important issue, towards road and r a i l hss been isaconsistent, aut w d , on the whole, no major d i s t o r t Wwe,rtbeless, not apply far c e r t a i n periods. I n the mid-1950~~ the rucks probably distorted t h e balance i n faror of the r rt r e s t r f r t i a s t a r t i n g i n t h e l a t e 1950s and the s o l h e t s s in t h e 2960s must have helped the r a i ions aad t h e eorrespoadiag increases i n t r a f f i c , as on roads in the dd-l9SOs, were used as j u s t i f i c a t i o n f o r further road i m e s m n t s , thus c ing the confusion. IQ retrospect, what was required i n the e a r l y 19608, a f t e r the F i r s t Highway Plan and the Atlantic Railroad were completed was a fresh look a t the sector, taking i n t o account a l l the x eu capacity and studyiag ways of making the best possible use of t h e duplicate f a c i l i t i e s available. The Parsons Eleprt discussed t h e issue, but it was unable t o provide a c l e a r answer t o it.  The Bank's r o l e i n r e l a t f o n t o transport coordination was weak dur5ng the 1950s but t h e issues became increasingly prominent i n Bank activities d u r ~ g the 1960s. The problem was raised a t t h e time oP the 1949 General S m e y Wssion, kt tn very general terms and without mjss analysis. T k transport de£icgencies at the I t h e suggested that road ania r a i l were c-1-ntaq ratber tbarn competitive modes. This notion -4 tlhrmghmt t h e 1990s and was p a r t i a l l y coalfmed by the Parsons Report i n L961. As a coanseque the Bank was conscious of the problem, it coatinued d u r i p a r s t o appraise road and r a i l projeces idew&atlp frcm e raised the pr&P= of t k e r r a t % cvehicle . The Bank never o f f i c i a l l y rts policy. h f y i n the l a s t f i v e o r six y e a s : has it &gun ero t internodal t a p e t i t f on seri06~sPyand inctiazed several attesspts to smdy P t in derail thea the dewel t of tAe Harvard Traaspott Model. 'Wevertheless, -- among ko.~wZedgean the subject is f a r from adequate, Y e t other r e a m explain t h e difference between the r e s u l t s in hi-ay and ratlway i.rsves-ats, h tai@ways, the poor i n i t i a l sondf- t i m of the neEwQr9, d the k h d of ~ r o v ~ nmtd s e meant t h a t vehicle owratgag cost sa\rIrrm, a d r o ~ s e ~ e n t l g k n f its, were very substan- &e tial. I n cCrratras;t, lthe rai1ways' %ow o ~ r a t f o - n a f ef . f iePency .meant t h a t t k p s t e n t i a l hnefdcs or' the r e h & i l i t a t f m programs and, t o a c e r t a i n ersSmt, of the Atlmtlc Raflrsad, did not materfal%ze in the way predic- ted, Ei.rrta operatianal e f f f c f a e y was a l s o refleeted i n low quality of raEB s t n f e e s , which 2 a turn affected t r a f f i c b.rbfames, further reducing t b e return o f' rthe i m s m n t s , Pbrially, the ra51waysq gerrrent and i n s t b t u t i ~ t m lprob4- a l s o d i s t o r t e d the h p l w n t a t f o r n of the program. The &lays i n the track re~~ewal progrm c q r m i s e d the use s f the new diesel l ~ w t i w e s aad. sther roZB-ing stock ;acqa;lioitbans. h o t h e r el-nt that faflwaced the f h a l return an the investments quite hesgily was the! cost meflrusls, and delays i n c a s ~ t r u c t i o n . The dif- ference bemeen h i w a y and ta.ilway kniiaesents is t h a t they were empen- sated by the very high level of benefits 2n the case of the former. The evolutisn of aft.is aspect over t h e is a g o d representation of the Bank l e a r n i w process, Ho detafled eragineerirng o r accurate cost e s t h a t e s were awaiPabZe for the irrves-nts baitiated i n the early 1950s. Most of the mjor problems eaourstered dttrbng construction were snforeseen. U ~ d e rr a t e r loans, i n the 1 9 6 0 ~ ~ e s t h t e s became nore accurate and cost: few p r o b ' l m of thfs nature recurred,  To be fagr, sake of the problems discussed above may not have been possible t o tackle in gast years, especially during the 1950s. And the d i f f i c u l t y was not conceptual -- t h e pra'blems were w e l l known a t the -- but rather lack s f a proper s t a t f s t l c a l basis. When t h i s evalu- a t i o n work 3a.s s t a r t e d , t h e major surprise was the lack of the ;nost b a s k bwledgge &oat &e work- sf the transport sector. Data t h a t are crucial, and d i c h hmPd be ava2labIe f a a cmnthy P i k e Colombia, such as hi-- t r a f f t e counts, o r cmpositfon oB ithe vehicle fleet, wre p a r t i a l and mreh2abIe. The Bank has daowtrated surprisingly l P t t l e heerest %n pr-ti= t h e e s t & I i s b n t of an %nfomatisnsystem d ail- a semd & c i s f a m a k b g process, It has sought t o 5m- sitwZ5m s e k % a t , p a r t i c u l a r l y with regard t o t r a f f i c counts, t e l y wit& mly l h i t e d success. There has been too great a tendency &n C a l d U t o regard 1Pection and a w l y s i s of s t a t i s t i c s as o-tbf- Co b e done m l y for projects, a 9 adecpare i n f o m a t ion syster;m is st511 not saiE&le, Che last w r d of casttim. The fact rbat gast railway %nvestmeats shm a 1 - r e t m does m e mcessbuflg mesa %bas, now jin 1972, railways shmPd be dfremtin=r?, fact chat new the Atlantic .dC%lr~ad is the -st -ofitable sect%atnof the rail system iL"nstrates thbs point. The stady of the ralB'i'ays;" furare role requires a di%ferePPf: type s f analysis, h i e h f rests the sted evolutfen 09 trhe @ o l d i i w lecra d cons%- ders the existicg -sets a s SGP,~~;.i w e s m n t s , wZtbmt a l t e r n a t i v e uses. 9, The sb@dLd gsrmote r k s e t t a g u p of an 2nfo.rtaatgoa system i n G o l d f a to prduce the data regpsired fer a reasogflbPe appragsal of high- way asd railway projects, for seetor srrildies and for a betcer uncier- otmdbag of the interact%- oE transport wbtb other sectors: f o r e m k - ple, rel5able r o d traffk counts, dtta%led costs and t a r i f f s , capacity utilizatim big~res,efffckncy fndicatol's 4 vebicle f l e e t emposition. Data prabl- zrs e s ~ c f a l l y a canre ba relati- t o road transport. Since the infamatria rased by the Bank is no d i f f e r e n t from rfnar required for the cepmrrgYs caun trevnopnrt pPara"~i,ng purposes, the best way t o abtain it wm2d be to easure that Ga1mbLags Zraaspetr Plmaing Office operates eftEr?etZ~i?9;p,and m k e s full use oE the dara collected by diffexe-rit agen- cies. The B a a could prmide tecbnbcal assist- and perhaps financial resources to h e l p establfsh aa e f f f c i e n t infarzaathm s y s r a .  2 . The Bank shotrld have a b e t t e r understanding than i r now has of t h e Wacr of t r a n s p o r t on t h e rest of t h e eco=aq, e s p e c i a l l y when it is involved i n massive improvements in t r m - p o r t over a long period, as i n C e l d i a . To a t t a i n t h i s objectrye, t b e Bade can folilew t h r e e courses, F i r s t , it can accelerate t h e t e s t i n g of techniques, such as the Harvard Transport Hodel, that w i l l allow tlze kind of o v e r a l l view required. re such .rmapr&eiiive t r a n s p o r t planning i n Second, it carp a c t i v e l y s e l e c t e d camtries, perhaps previdi.rag tecb5cal a can give -re . : s i s t a n c e Third, it eqhas%st o t h e i n t e r a c t i o n s of transport with tLleo t h e r sectors in its t r a p o r e sector reviews. 3, m e Bazik sh~arrldi n c P ~ & i n transport project a p p r a i s a l s a quanti- ficatim 0 X e P f e regional. h p a t of inmsmats, a d some revfew of t h e eapAi8lty of other s e c t o r s t o respond to t h e opplartuaities opened by t h e t r a n s p r t @rbv-nts, ineIud2.ng possible i n s t i t u h i o n a l c o n s t r a i n t s . F s m a prractdical vie-int, tPse b s a e is to f . workable ways of incor- wrath8 t b a e aprr?cts 4*0 noaneel projest appraisals, Resource under- %nl,BBitatierna cmld be detected b several w a y ~ , from simple e r o n m i c indi- cators ( l o p ~ t lte v e l s , land use, pr9dznction techniques) considered at t h e p r o j e c t sehectim stage, to a f u l l - s c a l e xegZozal dev~lopment: sItudj, me m t h d t o be foil--ed will & p n d 0s data a v a i l a b i l i t y i n each regian. The sase promdures could be used t o evaluate whether t5e p t - > t i a t &=fits af tr-p%rt i m e a e n t s w3Pl materialize,. 4. m a ebe B a d gartbcipates i n a raflway investment progrim i t ahcst;ld fwizpt, as it has hewn t o 80 5ahi the last two pars, on a p a r a l l e l opteratfimal pr-rm, s p e 1 f y i w a d e t a f l t h e way i n which t b e new Fn- ves-nrts are going f;a *be used a d eontain%ag d e t a i l e d mnagernent and operati-% rargets, h ~ j e c i t apjp+afsals o9naul.d take i n s t i t u t i o n a l inef- ffcr8eneies ~ l i c i E ' l , gfato a c c m n t , by a s s m i n g that c e r t a i n operational s t m w d r ; w i l l nor ~ t e r i a l i m-mril a SafIet &ate, 5, There slmmld be i n c a r p r a t e d in the selectZsa afad appraisal of high- way p r o j e c t s ar of tests o r iadicatoss _I:O a h m whether the b e n e f i t s of the project, i n term a£ rrrampcrr c o s t savings, will be passed on t o the t r u c k users b a i d d l e z l ) sad by them to c o m e r s and producers. Some of these tests or idSicators eeuld be based on the b t r w t v r e of the tnickhqg Zndastry, t a r i f f s , a a t s r e of srzrwEcos,and s o on. 6, The Bank shcrahd encmr-e t h e s w l t a n e o - m cmsiderarieri of design s t d i i r d s arrd t h e type of vehicles t o be used, Even i f t h f s ? s not  . done, whiele e st sitim shoaald be a crucial factor k &f iaaing design 7, E gram at a natioraal <at reglanal) le-l -- i s an a a highway pro- i.pe that war- aud feedex XQ&, apd hb smesltesign. ;A de a clearer see of m1 a9 at a F19tiona1 ) of the project or parts of elre pzo- 8, WWr as u sepa-rae project BT 815: part BE such a sector program, rb ton;s%&r pr.rwbim of asshtanee t a p C o P d i a shaPd e m f i l l y '3rd~ 'bottleneckam. Xms Wec5,Zlales, fs 's as-  Ewer sfnce 1948, brities requested asslat- aace with v#iow 5881 reelectric s the Bads Zlgs been fnvol- 19513-1970 as a vlirole ft bars fTmaacfq to the ~kttar. Its decade of the f total invest-  Of th9 two =in f d b i t e d areas of she country one hd;S great hydro- eHeetrBc poteslthl a & sossge Eogsil fuels, while rhe sther b a fairly a h a a r fossil hels h ta s l amost ;ns attrateive hydrr~ePectricsites, The W e a m regioza, d e b a b u t 65% of naeiol~alpopulation, has hydrapo- tentfril estiscJatd at W , m BW, 9%wbielr HW h caarrently ex- 22% of the country's Patfen, bas afl a d mt~rrralgas as -8 a d relies an- ebe-l genesatf -. The Elams, M.rb represent about half grew= resdtwces there raarain drttjuzlly a t a e q 3 0 f t e d . eo%tb of - 1 % ~ r s q p h y laas been Capgtacterfzed by h p o t t a n t e&% seeter. &ze are Qm large am3 nelatdveZg strong ta aid EFH -faMef%&a,Three eatit%es BrW a33as 0 oh HCTErL, ( f e m t l y EBiectra- Ww1te k m efiksrts to & o a Blectr a sen- matTlr~m%1 agency Vie& rebipmib f a ~Plwtiq smtlre pb&* rn a blble%of~81 bs%s ad - 9 fsag plaars, L t t-fmd 9y or@a%-, i=r%?equa%ie- 1y staffget, a d ~ B J l e c trs pgblfeft;a2 tate&er-c, I n g m s a l , the wl- ftp ef slk~tffsttesolln &&elw, a d emt, e e x m Q-d am&l~b5.liity fir~ic??b ptteraa, ate., b as b - effwtdwe I--tern ZmotffHcime to a l f ~ u plan- i n same fnstances plants w e r e s*arted, only t o be diseontilaued when t h i s clear. BMle cities l i k e Bagata, Medellin, a d t4anfzales have e f d i c i e a t e l e c a i e f t y service, =st other centers bidwe continual- I g suffered from m j o r shortages a d w e r e forced t o adopt short-term a e r - geaxcy solutiorss to cope w%th the gr9)19tl., of demand. The effects of hpx-ov- in cities h e generally %en aeprrewly cfrcmxiscrfbed t o environs, plus, in =re recent years, a few secondary effcmts ta strengthen E a E t gn recent years have yet to Betweem L 9m a d 1976), the e d i d generating capacity of EELB, Em, mCiCl)Pfdralaaad CBEC ham $ram a t an average rate of same 13.6% p.a,, r i s b n g frm 46% of the @lie seetor toml of 241 r;lW i n 19% to a\rer 7@% of the 2,@78 B W t o t a l %a 1970, as shewn i n T a l e 4.1. Capa- fes bas incr oaIg at 8 % on average. CrQvsks of P m t 9 P l d maa-rban-$Cawcity an the ---- maf miss 2.8 - - 1.2 -2 2 .-3.4- - 9.0 687.8 PnstoBted tsatwcfty p e r - pit& ia t k sewfeet area s f the f w r major sys- tems ( 2 nsf 9et;nll pwkatiaaaa) *'irs a h t 242 w a t t s in 1978, red with m t i ~ ~ ga ~ w ilera~ sf a h r 92 w a t t sg P P etr the rally d i s p r c ~ ~ t i o m trate s sf as sat i s the camtry, vhi& bas eradiiti-llg fa-4 ihe reg%- ob M e - , Melli-la, a 11 and maimles, X a t k rest 0.f the w a z f y , m l y ehe 9reolgr-na: af AtPsntfea  uifla can be c to these four regforis fn terms of e rat and alec ce. In 1970, the five ts of which these cities are capitals acce~vnted for about 50% of t&e @ O ~ E P ~ ~ -pplation 'S a d 826 of total value added i n n the smnufacttzring sector. Fi-nciq expnsjboa has been a major probl%e~a,Calpmbia has been staceessftLH s i q 9ca;g-term cred6ts to cower %ore&@ exchange costs ih :m t k IBadc, the US E x h Bank, a d EBB, but m t of the campa- des bwe B d cmslderable diff%cnlties i l i a generating local currency reswrces far I--tern ianvesmnts. t i n v e s m a t have in the seven largest citfeo had p f t i a . e f51sg1zc%alraces of a norn-revalued assets sad only far two of f h m B a d EPM] snere rerams on revalued assets rig %as altabps h e n diPfSealt h a u s e of the w a t s y t s rapttal a d %las aeemmtd for c t 5% 09 tetal 5 m v - m the rseeeor, H m r e s i W ZSmncfal bas b d m be ate&& to - S t 3- except EEEB a d EPH. alent ia 1%5 ea =$22 22gBlgm fa 197'9, -se ff-ehl db%f%cstltia hawe a M d greatly to the iu-lrtftu- d m 3 sbrtaetcs eo tffeca&ayeLq-rmge p1mf-. Xmdeqmte t y s t m rasBeed %a P HmrtheIess ms91:&-j,8wes were t-a last f6ve years cf the IWss e f e h -1s in &he ~suIim8 c ~saer eed mttma sf tim H t h m y of r k s e -ram, The Utilfty f mrd%was eoab'i I S 8 a d wtfmt-e% ia PS9-fQ a 4 par&ly , fa M ~ 2s x m 0 : d 3 c .fD . 9 ~ O W ! the &erspa?sarts %t I-tY ly be able tcr secrrre amre adequate price levels for e3cctticfty. 1968 also saw the %as ate expected to plan, Sazafs, which w i l l consequent- the 9 B to launch . P83e PPam tem@%ases a possible -jot HGEE smbs%d5aies ia re- *%& vcwnxd .s cw=&ezpsuch as EEEB  &lays to its bor- cash fPmr, due &a, the uader %nflatiorwary tsg approwe a p p l g - ssudy rbe uble  a V5rt~1gl"xy311 of the projects fgnaaaacd by the Bank in C o l d i a b w e surbEerd - e% Ec22 gwrart ejects c w m d by the ~ S '17 S loans3 ?d were delay- d b $ear rn mre; the r-Pn&ng scsx were the t k e c tttaemal units f at 8! iQm318),t k La Hmula hydrwlwrec: plant tmctfon sf which air-dy we1P d e r way at the ttme oP Bade apprafsml) and the serma st-e @E l tk b M c q d i hy&=lmtrXe proJect. --%Is are shown %n Table 4.2. PBva p~x:8jects W delays of two or more: these * i r e ffxst stage W e 1 at of the Bargest P rerarlic plants under- * J EL mZt@Eae m m t ~-top ~ , I, En Els8weralb a d thlha. sm a &c f%rss ska l a p ZIf, w t k r major bydm by Em%, w e r Y a h l l f . The two t h PS a b e r yeat k h l d s T%e r-ms Ear s m h &Bays ore - m a , Em the m ~ of e the W&iaelcte.rrs&e p l a t s , t e e : M a X idilfEkcaXties m t n l g related to c d t t . $ w a d gifaagOnw eB lebe t o& bwe el-rly play& r pre- M g ~ d k 6f a sa~ictgmob B w ptiesrsme -B:ra'~pnelo @wr%de i a d ~ -3 trfgBicB oft- g~%gt%ies, a # l m , ~ , Zn $,eolr?ral ie-sal d&gf lmtmcm, 1a*'1&1[*s rff=ecdi( ~rz~=t-siw~ @%be@, rqaair%w rasslwes in r h osgggml dmlw, -8 d i a gf E i a l s cram lm i t h witb ithe ed v w a r 3.aa go $f prgrlgs, , -1- Ee B& W'&-nmtfora: marw, m t r m k m s a f 3 was m p f d f y :rue m Ykm prof =or were under- 3 - fm & a~i~lcs3tics t i~Lj 4 i s &w pllicr gm. W P t &%ir3elPOIS, [sm h a TabZe D e l y Sinra 9 t a o l ea3s-B: wer- e$% e p h a r .a~arfd - 42 ?~lb tkd;g ~ra$Zally farecast cost in tbe case 9% in the case of the s d stage of Gal l l y much greater in current prkes, drae to the inflation prevalent. The second stage of decbicaya, tbe first stage of E l Colcgio, and maeras also suffered serious cost overrans, esti.ut t 141fo, 4% and 141% of tke foreicast aormt. On four 2 a& 3, Zipaqufra 2 and Guttape I), act& foreign cosra were forezast but, i n a l l the other cases, foreiga currency overruns least 16Z, reach9ng higb oral- Sn eonneetim w i t h Calbm, the stage of IZP Colegfo and especially TTOISS~MS (141%). cost ov6mrum Sag delays, Web, s to m UE crst cosf;o* FtwcmS&at sore-artirurte c? Ckilpor plruaf shortly after tely ft was possible ro se of *is aloatg with equtp- t: dss laan for civil works) 8 affectimg tar- it bs aracaearr later mrt of eke 1358r, ft s t i l l reraa-id below 5% by 1969. The Bank's memmts on fWazcia31 perfomace may netsextheless have been generally &herd to, since t h y were less exact%% than fm the case of Bogota and HdelPian a d less precise, TarSff fncreases were especially problematic is C a l i beeawe of the Sraditioleal aoefal tearsToa! tbre and the ember- or$amfzatiml see-up of the 1 - l r sector; EHCa'12, wh2cZl is aidral" prgihsipal astopeer, together the icipalfty of Cali, effectively control the Board of Gghidral i n saatters iolE tar%ff plfcy, Pi-F.i;al p e r f e m m e of the @s m l l e r m et borrowers, mainly &ti% gram 1950s, bas generally been weaker, It tis doaabtEul whether t k y bawe been aa revalued assets even t m are ia it . & country wgtb a pos- Cat%- &-use of sergaas dSfic.anltfso ba e a r l y operation of t h e u d t s p h d e d Qmf alp h e ta, hulty bPPer design), lago f m extaas%on <b% the dfrtr2beiosa systm and s;u~ f& g r ~ ~ f t b , P5;o-a sf so many geaersstiw hawe kept fiisrly well %a line t d By t:bBank and ssystm tk?levers &mplicit the projects. Thf 8 & h n had k e n cCd abaf: ebe amount of shortage 1959- ctd swsb sf c k .ec also hawe h e n a tE f . r o l . e a ~W ~ %% e%.ar t f eb SUWt6- 4?.~%%;p .ic chat the system add%- tmrtlio.irdelays t h e *spfte the large e w e merr.atbas also, zhe large WorLty of the ti- plants biimaegdf by the h * appear still ka h a 9 o ecm- Iy we-5 HQ tbe seme of %inhi%%* &e gmeseat sjprem casm. width E k r,r-ms the asflit costs of -st: of the mjor pl-s e r e H a w ?by c-mism wBth caas'ts &n i n t o&er cwantriies; La- ssim, they were range mQ9a-250 per b instal- phants in triae MsdeilPfn regiions. mere i sa l me rmnt excepthn t o bath the abow conc1u~lons: fekcase OE eal-, m rifi1.d k k delays I m c-Bet&on did cause b p o r - rmnt p e r s-cqw 6&1 l964 a d 1965 a d m afe'h Ithe ros were 90 s~~btaB1nthlfa for the pbamt pBas related c m$La%iq of t8c ad-4 W n l $ r as a ndl$ plant sfaxce mean b l w were ~ Ise sra%fic%mt to g m aaly smm 235 d l 1 S 1 ~ kwh 1 per ye %sstaHld c a p c f q igwu&ml%r& a8 r e a p c i e factior 0 8 setme 92%) cB tb%e level t k m p L L970 due to p ' p : hy- b a q k 6 d f 9pWTL r-3 a d dePslys fa f&ll%* the f ~ $ @ f ~ ~ % rThe , fag%&%1% ay s t d y t k project, an d&ch the Bank baed dhib Qiereis&rcsn m S~WPDT ~ %dSLmed a rats iog mmra ~afat l a s t 15% on the extra $2, ed tQ4 0 aesbml-L.lr& r E b-l a m , a Z l W * Eos &a by&~H*ka2 dSfEleu'JLtiues h t as@% a-age gkdluuce%ioszof 235 aJS.Lti?on kwh s hoola rebm %pa 3911 fLmtZp p m t t s d EPlLlaag t b ssser- m%r), a d a s s d q l s ~ g i r s coao I of !&he?t h e m 1 ~Zacfi~k.at%w e be LfS$BDO to f%cgesplrr attantim was g3e- te Bydmlog.P.a1 a d gal w i c ul l iswesti~a:imrs d t A &CU= ~f @OSlt: at-t-* t The only other wj@rsystem addbtton wbI& &n r@tn;;rp@ct appears igblpally built, its first I m n asr props& by EEEB; t h e local cslmexgcy costs waa.icb income groups, and one-ad-one-half times as for the other income groups, which accounted for - st residezttiai e l e c t r i c i t y conslaraption), so that d d rmlci aot have t o be v e q price-elastic for mxe cost- relared ctarges to have a significant effect on the load. I n the second place, a stodv by the Eattonal Plaming >pat*-at sbws that average annual residemtial consxuption (about 2,- kwh) 1s higher than i n -st European cawkr2es, despite Bqpta's a t e clipate. In the third place, carparison betveea ta and W e l l i n ( a r e the tar2f f struc- demand ge%, while sabgidies on residential con- existfag, are significantly less than i n Bogota) ae electricity supply system may be used less efficient- l y i n Bogota, Load factors, f o r instance, a r e consistently laser Z n Bogota. Bkasuremmts taken at substations M % c a t eresidential load factors of 0 .63 i n elli in and 0.57 i n Bogota. Since restdential con- carption c w s t i t u t e s about 28% of Bogota sales i n 1970 t h i s difference i n load factor difference i n system load i n 1970 of s a e 10 t given attention t o the problem of -iff strtrstm t f s mt clear that the p o l i t i c a l d i f f i c u l t i e s ?&at in raisi= t a r i f f s can justbfy large rebsidfes , as sem t o have been ; rccordisg to the e s t b a t e s mado 3% of the t o t a l sub- eo the wealthiest 8%of resideat Indusrtial d m & for e l c c t r t c i t y is psobably less r e s of energy) t o prices cbargsd, a d &ar. is no cast prices t o industrial CemSUICPb a a w n indicate a a t h e l a t t e r , vhich be explained by differwee i a tbe iadrertria structure of the a m cities, While the ttrrtceure of prices f e r e l e c t r i c i t y aay have induced less efficient use of the e l e c t r f c r l system than possible a d while industry b.a carried aach of the fiaaaciaf burden of m i f f fncreadles,gi there is no question but that iadusery has f i t t e d significantly f r a ~ ntk ex- pansion of the pzib1ic electricity supply system a d its good degree of - I/ To distort.lon such iacmtives effective Bed bg h%& -me-- also require ocrrrecting the foa: sight toorlt, - 21 mgotaqarhig& pric& f& i ~ u s t r f a ftStran f& residential co5~~tmp- t i o a a t e m o t paralleled in a l l rdre other eitPes, but there has been a noteworthy t r d tk t tbie couattfr far prices t o i d u s t r i a l consuets to increase rro& faster tban t h w ! to residential con- s- s. r e l i a b i l i t y i n W e l l i n , Bogota a d Mamitales. Nationally, industrial use currently accounts f o r sare 35% of t o t a l e l e c t r i c i t y consmption i n G o l a b i a (uhich is rather lw on dnternatioartf son). Between 1956 and 1968 every percentage point increase t r i a l value added required, on average, a comparable increase i n i d s t r i a l coasuaptian of e l e c t r i c i t y of about 1 .1 % . There is no i d i c a t i o a fromi the amlilable s t a t i s t i c s that shortages i n public e l e c t r i c i t y supply i n the %lain cities have bampered i l d u s t r f a l grossth the, Evm the shortages i n tbe main c i t i e s i n t h e early 1960s £ i d no r e f l e c t i o a i n a significently reduced pace of industrial grawtb there a t the time, perhaps partly because the p c ~ e r- es a t t m e d to copfine any xteeessary rationing mainly t o ranufictarfng establish- a f f ccted ntch mare by p l m t , and t h i s r e l i a b i l i t y of the public r i n electricity a l s o p u t l y reflected of e l e c t r i c i t y tb8t tiook p thcp were ammeted to the a system, i n 2963 and 1967 respectively. foa is tbe largest sdagle use of publicly sup- try as a &ole, m t i - f o r aa, much as i4m of the dfs- t i o n system, especially i n ehe early a%en of Sank fimcing %m large qwmtities enabled amre rapid ~i'bisisy fE0H ptm&slm sf:pu239f.: te cam a t the work. A t aprta~ ciha~gecard to btfe beten nee- S m E h =kg= S - t~tp%tal COW- saCk smdies mt i n fact So Ba aoe p be= c l a m. There is some cvi- dl c ppcof d i s e %a tg iteelng r M g h r than aecessary -- use of co Pes llexeepz rest areas and sa~~p1eeees~verage sitla a %bee-phase,fmm-w%resystem, Addi.tbzm1 prdlt- arise rbe e m f w e pattern of P a d 98;e7~elomntLa the city, tbe resrala of k k b e E s of g wEmb8e. of funds out of for &Z%trLht oa genwaclon ssam, 'baa$ st twdh&llc sere b@f= slIr~cate03%a tlte best way- Hstrfht;%gsa &%a- tfim ~f df m y hawe r-aed --sf eim &a t b u r l y teBy maw . ~ t % r r : ~ ~ e b -0- Urban Study $%Iftsata in 5 w * t to ape wfFo%a these p r & f m m& m e mt%rrfaets9f%.lr, of individual project -- Cdlira, Zipaqaira 2 d Oogpiqae these projects rceulted mainly fra imestigrtionar rad coat estimates, &as trpaarion, acglect of ttzc s poor design. Omatrtrction s ooartractioa cost estimster Qttate. lw~g -- were lnot tive level tB+ Be* acver play 2x1 helping Too l i t t l e is hrcrrm rbatt the d q q w s o f eityudtawnand eO1ambia Co be at a11 defiuitive on  Xn sitoplioao dl, it s€ema to am dmtftwt8m %w 8 th ammtry as a central ck-8 whfch wfP% take re%- %- m r a & s fa pr~;osr$b%l%~ ~ d mprdsLw sd1B-s~aIeprojects a d te- cerve bEmk lam = em a k r tk% p ~ ) j e e tgee r ssX t a& t h t 8 t a h 11 weaker -ller nZes get fur- &.  l k d a c t i o n did gmu, a d profits to be eamed, B a t it was net unt -- tboagh very 1959, mall -- began afterth given a f i m z ~ i u t i m that i t of a project es- t i v t e d to cmst W58.7 dllioa in total.  Paz deP RSo 1963 Expa~sSoaProject: Costs and Constru~tlonSchedules, ad FtB~t2~ask Actual Construction Sc'baledule Forexast Actual /Likely Useful Dare Date dl! - B l d f a~ig: 894 le3W 2965 EI =I 1965 l 3 7 9969 XI 8iater B P a s ~ t 6,951 Bs352 1967 H 1968 III I%$ PXX . BP. T m b B2-r~ 631 1,297 1965 HR7 1968 IV 1968 IY ~ ~ l m c w 703 1 %PHI ~ 196~ 1 as;llin miBli~~pskwrjPrn the project bas been delay i n what tmns out to be a tmscia to rmr the d l 1 uoald be 150,000 ficient desmnd for bot-rolled products i n & I d The iprlitsllrof?&rtIoftbnrpro cmthcothcr Z#0 l l y to product I  c a s s ~ t i m . HdfC5m OE the 1 ~ ~ 1 mZlP ~ 3 %n 1975, as n m planned, will raise aS1L? internal rate of return on the e qaag-nt financed with Bank %Bf c h l foreggn exchange rate and re Bdutfes, Ca1culations at the : xrcf ty ex- P return of less than 6% to the Bad f veturn to the Bad- Bay bn execution and t o the asamptalons of 14% at ehe ~fffcligi? -re are pr&lw% rXte~E&vs& pleaagrtsts eested which pleld acc"~~rabl8a &a&ma46=Pea o ~ C s~k~;~~re:lIt.y S t c s ~ mially = ml m a : . Ch.e %ST a very small scheme, ly a% t k BC~%BPIP -- project improve- - m @ t si s z m mce tgm a d bhst ~ c b e r ,a& the =By preject e b t ygeldr ~ t i s aa9;trw r s s ~ l t % m . g asg .to the walaae @f belrofg 1arge.a: m a t ,k k aetwlly dr$rZaWm a d %=Xd-ri% addfitLom1 iron- for %-kt& slabs. For pmmses od ;z?aPgrsisit was supposed that a $Szst pirtBm, c-%s&f= nt%~llyOZ Part B of t b Mk'nit actual p a - peet, eg31.t *-% f b a a f%- %B 1959 w i t h a 1 0 s ~ of a h t =$I5 aiflPTcn, dPEe f k e c d sltsge, d i & d & k have reqasrd fore&@ fi=nriakg of as mcb 3s US$ 130 m i l k ? % a , d g b t hawe k m tdnderuba fja 1964, taktrig adsrantage of the e s a b l f s b a t of the Cgnsultat5ve Group shortly before. %is said, there amst yet be serfoxas qa.aest2oion about ehe fea- slbility a d realism OE such a large-scale program. Pf the company cmPd not effeetiwel it did shaw serious ge a BJSS60 m&llio at5on a d lack of ston prbgrw aza -- and haw could it -- b 9 e posibly b ar bd a DG250 mnilPtion l gram? The answer t o t h i s amt be eP%ar,a d 1 ;6 may welB be that the Bank ddd t?rue best ie couzd, g i- tRe slkspinistrat2ve eapab:%%t;i.9~s f the company -- though ewea then It was olb*msly in reCrospect a shottcatq to separa~ethe hot d l 1 d r m &he cola! &lH, Pttafcfr &~uHd have been either dane together ia 1963 esr p s together watfl later. As an 2atiLtsrtim Paz del Wo bas s-qskhened met the years, &Be!high-leaex E)k& Blissfan d1eb vlsitd &l&b%a 1959 and Laid ehe tfoa, Besr the v;oxL up to &e loaa o f 1963, Ewnd a r-sapaap h ic;2n , sf-r - e s u a t sk ir.ozrre nS385 dllboa, had made acee?aati~g: prcpfjPts tnr only &jo y a r s {I957 a d 19589 a~~~).untiw to the paltry tom1 af aborrt @S$3 a%LElen ev%mleat aaxt &i& was to s&aw a loss agafn far -eke year 1958. I l ia l %9, by m t r a s f , acmntisrg profits reached nearly m U S 5 d l % %a#nlma, a d fa 1970 :aar9y P S f millioaa. S a of thfs fwrmmmt is the? result e sf i n 5 l a t l a , but am& of ft mq s r ~ a f o a t S ~ arr kd Sat;Ttuti;a=l &%es. Fast te sf eff2cicnq shau sl@lfic;llnt mrmll?as aver Z%e %a 1qr%aeaat % t i s a &ick b s d d e d l g helped isprowe ef%ic%emcy is &e bdget, ceraaral a d = =-at i&a-tim WS- %atrodueed by Arr3ur M~?x"M d Go. in 1963-2%% d e r a cs1we89nat of the ILssm, Particularly %*rant bas k e n ehaz appofintrr?it in 1967 of a s ew WeaMenr: of zkt ay d a teor@tl$atfen m e be iatrdged S;ss 1968 the oreaiatim structure a d the div4si m= e q ebf.rissrs acs-cod%% t o &%r wztieu8 Us &&=red to TP-it-lly a l l eke exceptrcainally Ima, there fs a q w s r i ~ n t~&&e~ of C b s e Eikanges a d P - ts d g h t zmt hawe been acbi earlier wfth a a mre active ~Picy en %be pare a F the ' b l a d e "P"heB a d i s renewed insis-ne .Bkn '1959 l tbt no prwress could be wi%houtc q r e k n s 5 v e ma;llg-~.t a s d s t - a c e first h i ~ & g m i w d is urodersmndable in tr3.e~ of the czises of rSEe d d d l e 1958s bat seesas rtevertheless unforturrate ia retrospect, The  ny ha8 not talken up &tion over tho p r e c e d i q three rime it tiad f i r s t it f i n a l l y ltmk f t only because it was a sime qua m pt of a B a d loam, ft did not include i n t h e contract the ineatiwe el to Kqpers rtbat the Bank ha aaded and f t @as apmrently net a d o w to take the adspice eve ffered. Several years weze Pose aver this, ad, p a r t l y because ft suwred the company m wprs, she ertrgiweri* m s u l l t a n t s wre c b i s g d a t the tBme the ex- to be eroeeutd, &ich p m b b l y added to the delays. M t h e r fact@ .st%~!g t o the dc;?ays w a s comloera- on the part of the Bresident s f my andl others rikiet the project was not well-ballanred a d tf38L 0:ie had k e n a & s a k e t o Lm Z& the hot aR1 wi-thout t h e cold dIL 3. i t auld be argued that t aigbt well have a larger p r w m in 1% Bank moved I n 3 w i t h a $saall first-stage project fn which it onould hawe PIWDSW dzzireetllg rsritla tCb sularaes a m , o s t e e t d rn their e q -- raeko r p amze?~its, h con- n mplzlgo?f9tfat, W S a -re ar;ap%d pmgre n arentml cct m ore ptHarlty pres-bPy b t~ ib i:a a g%wen t o 8&- in & E L *b , asid aeceswm dames Sxa r k E d e r s h f p of the could hawe saccurred tben instead esf wagti- w a t i l 3967, c pdaaat of vfew &here =st too be scme pwst%snabout &he dftectgm &icb i m s t i t o e f a l * q u ? b s stctutrllly e:p"brken. I r ~ r e a o ee-the cmebl mttea: 0% the c d d m%11 %Bas been inoxd5na- t e l y slaw. Part ( sf the F ~ B - for slew pxog-fess bas been reluetxime of the any r ls 99;dert~lk d ;aqpbPIe sector fwnc%w,kan order t o a k e -- fie the em~t%;q h i & bas m n t , iaa the absence of e large st5c scpplfet crwlits. In rh l e -at*, wbi osimg t t s share c a d I f h l g less e 11 lse~t gre;3~;e - m eon i w r t e d s&-fingshed a m h d because s t e e l to ~ ~ t to i@OI$ ~ a tca relatfwely rapii pace. Taagrse  cmPd %lawe been awerted w i t h a better-plamed i-1 seeel dewelomnt fn the -sly 9960s. Had fmg oa t k a ' 1 d l s m authoritfes Ln tbf s respect, hcgplly en Paz de4. R D as a problem capany, ra rrprbent f t s Pastftutirrm-hBPdw efforts withthin rk a d itbas kip d e w 9 q the A m a h s into a a a t i e m l dewel I . &s%e x&sltries fs pkt:+mIar, such a s steal, s h g d Ibe a~~i1y~piied f r m rr m t % m l before projects are pregsard a d B ~ P H Ie ~f~fW ~ts, mu pgrogects lo*- tern strare-. 2, m pd$~.cipl nts of -%or i d m t r h l grtojeets, not only the m b t i n a g d cmt- be s d j e e c d t timn a d d k h BI~LLJLP for *e Qh\gs 1ma-q e.ppa%wat.  E v a E w b w OE t k eBEectbm~ssOE the I m D pltegrm of assistance to the Sact that GOV- .fy a h t s d - p r o j e t -41mnt fte wgeb Ehe Fmac&em t a 1 -rbt d the gr sf .a; l % e e t & of t b tw ~ f m f p a & ~ ~Q k ~ e f m the early $93& ohere was w&rtg&adjPglpno inst&z~z7s-P smrce of far pr4iwate enCcrgr$s le C o l d f a , me c sb8rt-eem f e d t s a d the lmky '?1'1e~fiere:mwil: 2&ll?%f'vy?ty bdc, a few fea@-=&klac a&rt&n@ but was tars s a g e r l y b r e Cr"nsrewmE1yS private eneeqr$se earnin- mita&~a& bmiilg eapiital for f fmn- eimg Pf=d ims-oe, $ sftmtfm 6 31 l952,,ABf-8 1 meto, a c w a r l t m k sent by t b e b mqpagist 0% the &l&iaa a~iltharf- %yw u l - r i s h w of a asew &tee eff5cLemy of the public at the -&t9 b a " nshwld be in t k private sector, Wtrcrees wmitti% the asa&lfshnt of nsach enterpr2ses were f2malPy passed bra 1957. T k f2we F i ~ c ~ r e r a s which the Bask has s ted were esta4bPiskd be 1959 and 1964: CciLm- bf- (~tilll m bgota r st) a Z95 5-l in &dtgll%n Pn illa h 19U. ?SFG t 4 eqwity p a r t Z c f p a t P p ~In ~ C o l m a b b m and naw b sbmhstdi- I a IL aP flve, l fjersss hawe been estab-  nveW &tsel?E lia these Ithe  d frm retakned earnfags or gram n m - h t i t u t i m l scmtces, Cn- %mtitrrati-l d trade credit ts dhicln will be further discussed belaw. ~ -- ~ E f ~ 'Eripeh k egme-tg~prof%ts l a l y bi@ tn %h q p ~ a & l g %mflati-q of &me 2 O - S X of equity, oa and -- B, C0ftRXi- ww-c*iBfg rat&- s c r f b d l-tr, as by a l l ~aap * c-lll~iies ~PBtc~~ii~iie h w t t h h pre- C~LBS.  ma a s ns aa rr *a , B~S a9 *ms 9 . 2 6 s. t m-6 ~ . 2 3-3 c.2 2 3 - 9.0 a % @m (D * s 63 0% * act aa ha 9.9 8 - 7.2 6.1 ar r ~ s  - Table 6.9 SECtMIQL DISTRIBUTIOH OF IBRD CREDIT LIIES CDHH1TTEOAN0DS I BURSED, TOTAL LOANSDI S BURSED BY CORWRAClRlES FINANCIERAS AND NATIONAL INVESTaNT IN WAWFACTURN I G Average Annual Cmwth Rate Total Loans Disbursed Total mtiaul of Real Gross Sub-Loans fran I B RD Credit ~ i n c g ' by Financieras c l (Urmfacturing Product i% , Cannitmnts Disbursannts Jan. 31. 1967 t o - June 30. 1970 - Won-durable Consuner Goods Food Beverages Tobacco Products Texti Ies Clothing C Fw-ar Printing C Publishing Pharnaceutical 5 Related Products Subtotal Durable Consumr Goods Furniture 6 Fixtures Rubber Products Ceramic Products Non-electric Appliances Electrical Appliances WOtor Vehicles Subtotal Intermediate Goods Textiles VFcd 5 Products Paper P Pmducts 29 Leather c Producrs 31 less 313 C k i c a l s Other Than Pharnaceuticals 32 Petroleum C Coal Products 33 less 333 Won-metallic Nineral Products 3'3 Basic Metals 35 Metal Products Subtotal Capital Goods 36 less 361 Wcchanical Each. 371 Electrical Each. (except appl iances) 38 less 383. 385 Transport Equipment (excwt m t o r vehicles) - Subtotal - - - - - - i( Wrlvad from Frrnc11~0 lbeuml, Industrla t(mufrcturara Far11 1958-67 (CID, Bogota, 1990). PIgures are given I n brackets a r c th. Seete-1 WUIth -to l a avrlleble only For a rodbination o f thr sub-sectors g l w n hm, so that It 3s untnam whrther the g m t h - r a t e really wiles te both s * M t t ~ ~ . M & ~ l y r ! sof thr n o r n t s o f sub-loan ca~lltmontsand dlsbursmants approved through as r D b l. 31. 1969 under L r s 433. S H end 6s; W w t . 11 f d w tth. period cowred a m $27.6 mll lSon and aggregate ccnrrltnnts $03.3 a l l l l o n . C m l t a a n t bamn tn 1% md d I s b u r s m t s I n a%?. C l Fmp a l l sources o f fundv: bond-lssuao. own funds, b o r m l n p s f m IMI. PIF. IIRD. IFF. RID. etc b t n c l u d . ~m? l n w s ~ plus t changl I n Inventorlea R r 1 s t and I t *. j$ I n w l F a n t d4vld.d a r b l t r a r i l y I n rhls t.bla&, 5t% t o Won-durable Consumr Good, m d 5CfZ t o I n t e m d l e t e Eolsds.  STRUCNRE OF COLOPIBUN 11006Rls ~ A C ~ nI W R I , 3? SIZE OF ESTBLISIU5M 1968, AND 18RD L€NOIW 1967-69 *S ? : -~ . - ~ - -- - ~ ..... I n s r r a e n t a l G.V.A. Ave. Annual Percent Line* t o Corwraeione. ~ i m s e i c r i $ ~ Total G.v.~.~' Wage Colt$/ Ins~ure R.P. i n s t a l l e d G.V.A. per C.V.A. I s a s l e s s wage8 per H.P. Real @ w t h i n parrent of of T o t a l Disburamnts C-1-ts no. of ~ c z s m s no. of Emplwed per ~ n p l o y s s per employee i n r e a l wage* per employee H.P. wage* par R P. 1963-67 C.P.V.- 1963-67 Total Investment ind, t h r m a h l2E31169 t h r y h l223lif.9 Emloycd Est.bltr. ('WOs) (Pesos) (Pesos) 1953-66 1968 (Pesos) (~a.0.) J (1958 Pesos) (Z P . ) . G.V.&. U.n~f.c~uri- (S of t o l d ) ( a of t o t a l ) - a/ Crose Valve Added. 8 8 given by DUIE. includes i n d i t e c c colt. (e.g. t o o l s ) and depreciation of eguipncnt. E/ Includi-4 Prestaeiaem So~i.lr. (Fringmf.); d m m i n a t o r i s paid e l o y c a e . rl I.E. C I O ~ S Value Added l e a l wage* aad Prestaciones Soci.lts per h o r s c p a c r i n s t a l l e d . T o u t InvcBmant inclvdsa Rst Irmastmenr $1- (or minus) change i n i n v m t o r i e a . f r m MM. The f i g u r e s a h o m are f o r 1967 fi 1%8 rddad toaether 21 ~ n a 1 y . i ~of the m ~ u n t s f aub-sean coaaiments and diabur.ments t o ..nufact~ring industry approved throi.gh 31, 1969 l w n s 451, 53i and 625, u s i n $ i n f o m e i o n on ep1o)aent auppllcd b\ th F i n m d 9 r a s and tic Sara Inbstriak Cnl-- bla for 1969: aggregate disburs-nts for the period covered are $27.6 m i l l i m and c m i t m m r s $33.5 m i l l i o n . ms 12/31/69 cut-off la taken t o ..he the figure. l ~ t e coap.rshle w i t h those i n Colran 10 r e f e r r i a t o im**m*nt I r : % : and B96* ** e1.0 becaul@send i n f m n t i a 1s nor av.ilable f o r 1970 due t o change' i n IBRDmnnar of c l a s s i f i c a t i o n . i/ Thia f i y r e i a a l m @ ta e r t a i n l y an overeatiuf.. l a for e t h e r m l l - a t s e firms the o f f i c i a l DANE f i g u r e i r much lower t l n n t h a t shovn. nut f o r t h l r s i z e catsgorv John Tadd'r ~ d j u a t m m t , b s r d on t r a c t - indivldhal f'm* IS% t h e 'ran (to *Wid the difficulties introducsd by Dm'. very varying cevlraga), i a v u k bacauae i t i s basad on f w f i n a l . f{ zz: ::E~:i~v~m~l$*;~~ i;mWz: ; pmb1- noted i n the preceding feotnotc with DAM information on f i m 8 i n t h i e . t i e catego.\. &?%% Mmd - * - 1 ~ a i ~Of D m , I n d u s t r i a Mlnufacturara 2968 f o l l w i n g appnuch of lohn odd of ~ i l l i a m c i f n c i e l of MW's rrmrcn 1lRD data. i n p a r t i c u l a r may be undarestirmtes v ~ t h under*atimte of vrgc g r m h i n mallmr-size finno. ~ o l m n s ~ celleg. f a r prrc.dinli year,. respect t o figural of outpbt and vahue per m p ~ o v c eend nore aap.ci.~l) share of t o t a l o u t p ~ t. b o ~ m n 11). CQIW. 5 i r b a e d on mr* or John 9 and 10 me baaed on ~ r . ~ ~ i n c m me f i g u r e s f o r the t h r e e sarl1e.t r i s e c a t s y . r i e a (throush 14 a p l o \ e e a ) e a n m t be rr8.ld.r) a* w*\ - d i * b l e . . o m i , tnd,,rtri. kan, t.ct,,rer. ~ a b r i l198-6: (Bogota. CID. 19701 which i a in t u r n based en MW data. CohmnS 13 and '% ara Iwrd .* "-* T&d - *ti- * d W * for ti-  firsts in the size range 180-200 -lopes the shares of IBRD funds and of natioadl investrent were a W t idemtical, F i m s of less than 100 employees, on the account for only 809% of funds can- pared w i t h 24% of turimg invesfaen&I. There is r o a for a l l y the logt efficient fa either f c eermes. Avail- able data suggests that, on average, large firms haas been yielding markedly larer returns n erediufp-size 8 @ 5 of Table 6.4, ltlp the absence of good f f - ividual firrs i n Col eh* Best, i f still poor, logical differences difference to I cormtries amalpzed (such as Tai-, Eofedl d Mia) aad Pn same bran- I cbes, such as textiles and leather products, capital fntetmiw@ewen propottion of all - 21 United Spatiaas: Tables, quoted i n l953-6Sw, (Geneva 1970). o;url c2 - w i t h developing countries more advanced t k m C o l d f a i s in- dustry (sttch as Spain, Werdco, B r a z i l aad ); overall, Calambian bdast;ry meraged 3.3 h p .. per erployed pemon, against 2 .2 for the grmp of less advanced dewelapiug couptries anti 3 .0 for the more ad- vaaced grarp. This high capital intensity f s particularly apparent asxmg ehe larger fSrrs. Table 6 .4 indicates an mrage of over 5.0 h.p. bstalled w i v e capacity per employee in large firms (over 200 employees) by 1 968, a m p a r d w i t b a P a t i d awerage, a s of that year, of 3.8 and only 2 9 for d i u - s i t e f i m d 2.6 for small-sbte fimas. . High capital-1- ratios in u u k n unufartr; coaerasts between firms of expansitre for tlre smeller fllhile credit fass been mu& cheaper rad urrc &fly mailable. 1/ !i -1961 (prices fa 1959 pesos). An f~creasiagtrend  A s regards the mmt of labor, Table 6 .4 indicates that wages Ln tbe large firms averaged in 1968 rore tbaa 3Q% the ilatianal average for rodern e a c t u r i n y i , nearly 4OZ ab e awrsge for rediu-size firms aad sore than twice tbe average for - 11 flras. Part of tbese differentials is, of C O uHse, due to higher average s k i l l smd edacatianal levels of f1orkers i n larger f i m , due to roacpoly p m r of m i d and of sarc I in the cams- goods f -Id, prometed fraa a h s t 30%OQ capital goods). A 1968 st* con- of c e r r ~ t f r( ~ pay) s ~ service, ad by requiring a 16 and 19Z fror the sating BPr- or a.ge9 of credit for many aand lrargiaal cost of short-eenr  factors accounting for e p s r t per h.p, installed rises sot m l y enjoy much t s , but, due t o ) c d i - t t e d w&th as acti~alcost on- at a artargdnal S a x rate - 1$ & s a n g a - & ; f ? f ~ ~ ' b tax rate s . Gi~Pls,Fiscal &earn f a b T & b , M f 10-152; see Be&. --me aw -69 1911, a d - 2/ also cred3.t p r a ~ a E Q of far - 11 ~ =$3@ adiilfieraa 2 s 1968 &a s a w r t of a d =d&m 5Psdustzfw.  resa;alrs that t y igneff%icileaae tern of res be levels preprziiil- r;Be Pery raphd sate splpigott thbs cm- fell far tied. (see er Wor).  T M s cbpter r-m the M a ' s direct m t f % b a t i mto the grwth 06 t h agrBeaHtma1 s e e k e r , t I l a roxa@ project fl Bmg and polLcy advSce. mansEffrst l a a m &o -3- BS9, was a m e c h m % z a ~ i mc s d t t 1n 0%tSQ5 sfPPfm m e g l w n - E m the at e , &m 1966, the Bank sersmd r d f t , a M fbtartbr l &n 2967 and 1969. Tlogctilacr 26*lrsa&fers- 6, fa &%tIm t l ~ project L a g the soatrlbut%on a0 c b m& h %=Ed& s larbgc? s s w r s W y $a 1855, the poaikLng oE s l ~ a r aE- 19% &a 29S, a d &a11 mfesfan, &a 1967, En 197% the Bank @Bet. ncaolm%oat%en proj - %k erf tical rtame of CLe ambealtmra1 r-tiusp in the Go- Emr$%an ee a d c & the reta3r %al c asgraent Bank 1.c- EMS m s d41QfieatBt. It was m t %wet"& r li m b m L t r t s o k i m projeeor ibP tbe P9 s k a u ~ r sib%& to e m l a t e the two of eheilc ~ r f e e. Sabsmnth9 di$shrsiesearo by the end e ef fbe mbs-ee oh 6f a%97@ k d Wm p @ J e e din the s4~rai-l rcwrts the P%6-1%9 a. tWy hsad W m fmge m l y m ebe first lLweastocls =.bnlg by e t e ~ b v e w c i&~fdcta%%ed &ae& available retieatitrtatly of i d E w i d w l fa= t e a r d o , P it d%dprove p$8%abfdt0 & t t P m s w id*BrEatfmoof t&se that &P 1966-1%9 prajets are fell&= a d ta rme% s w cmja&sdons wtdirb, thmgcn p e l h k m q we cms%der mwmthclcss rii@%fiekpnt. But t h e early stage re* Pi e& EM three p ~ j e c t red ia t h g r e b p t s st5;dil stand s b u l d be cmstmtlg Wmc fw mtaae$ dn t h diiscwsfm, 'Bt taas mt p s s % b l t ,as b w e been Besgrablo, to rovblrrw the -ar4kss po)eces Iw the e@nt.b?xk of the prtPicg~6%058of alforhltg s~urcos  read%ly avai1a'bLe tbe US ExIm Bank and ed by ae Bank, bile l a d the mlleck%m of agrjtcaPtuxa1 staitLs- tfa. -era ps91vaW Bam&~fv883sb w e v p r W research &n agricul- er for Tmpica1 e r f - msultatjtwe Group the Bank, FAO, arnd 'BG%$ig W e r of the ~ t k d t u r a P mcror tn & B d h has, at r& bmd f m c mra1 p d w t i m a-Sl&Le f@r rdZy wt up d k b w@ar%m g r m b s 1950J 3,0-3.5.Z,QasagPile agrkaaltural prIt~ee rate .a~ rd m - ~ ~ i @ a P o apriees. 530 P t e m be t, 8wer tWs p e M , - pl y has kept up w2t.h t m *re the proBB- a s w t a t d w%th the ~rfemEtwa1weear3 Fimt, de3~31pfw the M e r a t e weral1 g r m b rate nkre hawe a&$?& wsilrgae- 'be af a few e w r t a d Svre-s&st%tute crop s $ m or-b 0% st tar5al e q r t s . As P&Jir$ $*P s w s * aeeagtltd Ear mearly 30% 0% tbe ~ J ; P ~ ah Wall m&~l;Wr tatPPrd. Zm~t"em4 p r d w t f m ~b the three crops has k e a due Z ~ ~ S E D te, ;rro effeet%we -*aths m d price dwprt sysle~s d a i ~ 3 i nh m& e b@ raa%BlSghlyprofiizab31red d ta f k ~ - 9 m af thefr area mder c:uXtiaatim tbto- the e e b m i z a t f m of atelaciwcly large farms. The  d-eveXop-a coald hawe mr d&recs hapact h t @ell"over ene W r d tern. WX 'tb@rob&- ob m a 1 m.eahsy are ors3t well reflected by ,& a m o s s r ~ t acXw%w%y -=%ahold wtth qr%culitut;aB &E=t ax= -13. famzs w2t-r weside er&ploy- lMt& &ala@ a erepr fs P&, - liw *re mpply k s : eq  3z& powerty, as w e l l as ihg pr43diuct4on by &acenslfy- d c i w a t i m rn land vhi& had d as'2:ensfwe5g, T he second grmp argued! Zn fmor of ewest fur brat* the process sf rural- &asr *rat* labor ; and of abwrbing all a d e r ~ 1 o y e d n a gigafirle i t, and because some d reform l a w would sccornl strategy has '1Parve c a s t i t u t e d an Sonary r i s k s , and h i e found dfb %vetaPess, w i a l r pd3tctM hex partSy be- - g % %- m az& m 2 s - Trm lagged be- g~tessdva e m 5 2 m an 3.adwtriaP d g)glt'eXy k a - IP r P s e %a f a d values1,even prdaca 05 mega pteEefar,e %orW w d i q Zand, serf 2 d a efferm eh~i *re btyl By the a d of the -4 Hec& &se, m y of o h pmprsd by tbe Bank W cedi. ?he %2sis k a reorgang- r its direcfim the decentra- a - 2 ~ ~ Scarwe f ~ b 3 l i t i a r k e sapprtr were expaadd. fen af erdit to &&? ~ r i c d t a r a 1sector was gtm* fassor than tb es as a W P B ~ of ~ r f a l t a r a pr&wrIm l meel- erared 9 a -aoet-e 5% per &a 1965-70 eq0re.d w i t h only 2.5 to 5.QZ 5n earlier p r d & , aa;:r%ala:9;2reother elmi coffee grew at 6% h s t e a d of zhe e a r l i e r 3X- Agah three crops --cotton, sugsrcane and soybeans -- accounted 5n large part for th%s s&stant%al fncrease i n the secesr '" s growth rate, but produet5o.a of srssae staple f o d s also grew rapidly. Sm-saffee a g r i c d t u r d exports-- prfneipally cotton, hivestock arrd satgar -- expanded consfderably. A33 these accmplfs ts, hawever, beaeffted mainly a limited the m j o r d t y of the r u r a l populat6m. Two legbsia- zw 2W of 1836 a d Law 135 0% 19SB, m d the ilnsritu- t;Pcms *fch were m-eLated d t 9 s thear enactmx~it, sthe Caja b r a r i a and L%WU, a11m fa89ed so the cf35r&buZfmatequzeed co relieve p e r % y7;n m8lanrt~sicle. Hn 1970, a 1 ;88 j; iar2kak eeoamic dsrrion diteetly f a&, prhps; f o r she ffrst t h e shce 1949, the problem of rural pawexr~yBxn & l d % a . The m i s s i s a n meed that ~ ~ e t oa lyrnillfon farm fmdlbee tave less rhm 5 hectares, With %sw a a d e r e d to be the d n i - tstm of crop Pmd seeded to earn eaoug'fs to support a basic level of Ifv%ng, and k"mr ebc mjorisrg of the fa=* popdasPon was concentrated oa t %ay raga fa-, &eras extensive g o d h d resources continued eo be aadesarzfl%ted. T he r i s s g m felt B t Mcessaq to s t a t e clearly that ohe bmic g a d s of a;he =re e f f k i e n t alloatfen of laad resources, as specified h the @ 1 d i m Agr~aSiltoRefom Lad, %%re still not being achiewd. . =e first lam mde by the a fts r e s q t b a a o i I t a d % qae & S d % a h t k 19Ws or PbvmtmI dwielo puqosc c ef tb projeca. was t o gsdthde 1m-t:ewsl ezedft %no pbrav-ats *bc& wwPd rebse betb atpt asid effiefacy of beef castle racks, b a i v and s b e p fams, % 2 a3 a~stof tlne mred at 05S28 dP1fm eg'b;Gvb;aa;: e b a k lam, e dgsburses 75 loans m d e by the 6aja & r a g a ara project ranchers ger rands develop- m t p ~ o s p s . m e Zaterest rate to f d d borrowe.k.swas relat9ve3y l a w , at l2$, sbnee i a f l a t i a n whScb bad meraed 19X m*ir the previws decade was sitdl1 tag at 8J per ma over the first four pears after the laan vifs md4,AI By the e r m d of 19743B d dbs5ursmnts aactaratad to 3 - I/ The iarreresn rate to the fdfliil hruwer tfne second livestock lo= ( b a n 6 5 1 4 of 8969) was r&d to 242, but bmfdaticm has been run- n h g at 1x2 a m a l rare s h e e the project was m d e effective fn lB'd3. The interest rare on Bank sub-loans has always ken bQher than tEie rate rn l a a s frrssa 0th: dasltbtutidnad sources of credit for livestock, but the tern s f the loans has also been 1ory:er (10 p a t s against, for exmaple, 7 years a t 1112 currently f o r the longer loans of the Bmco Gaadero, the -in source of credit f o r livestock). FS$LI.l milPim, ~ 0 4 8 f a r the sasllg period., el ared ~ to a p t of USS16.7 rnillioa m e broad p a t t e r n of investntent under t h e project was s u b s t a n t i a l l y d i f f e r e n t from t b a t expected at appra2saI. Sene 300 farms w e r e covered, toaspared w2th am etgd 1,200. Project h v e s ts were nose heavily cgsnaeatrafed on b ranches than expected, 92X as q a i n s t 57X. Moss of these ranches are b t h e Wrth GQ-t r e g l a , @ s l d i a % o h 'beef- p r & c w area, aPthgEn the project also covered nearly twice as many ranches as sr&f~paPly enwisaged (169 iaga2-t 903 &n the LSaaos, an area di%Pms wbietn had nos been given dabry program has been pruceedgning tbaa expected; it absorbed only d 87 farm, compared to the emisaged a t appraisal. The st sheep ranches met with tedh- Taae eaPuatf9n foersssd son t x beef ranc8aes 2x1 tke North Coast reg%= *bcIla am8uf)e for 652 of total. h v w m n t d e r the project. t o r a w the mnuaf bead h t o t a l from an esti- tb%s was t o be doae erastage pobnts (from 50 "dnends, ad, s a c ~ ~ ~ d a r f l y , farm 3%to 2X mldiglXy a d 1 - r a the we a% &%%Cb Seer8 afi? ~ h t e fr-d to thret?. T%e pmjeer a s t d 1 y ecrtterd less t h a s s e q w r t e r the expected ~&tr;r of ctdtrfe d e m s m d d y &out haw the r apssaber of f a m eaeib, h t u i t b a & g r - ~ e r fbac- 409 rpltnches r ran&, compared to ra&r;is & ES$P3, ted r-r amraiisa9.. The ~ P O ~ O C O did : SOL ser up any hfa-t&a flews adequate so show A e a k r amp detafled 3;~erEe ce targets givcera %a t h e XLWIC~ plans or i n the q p r a f s d rewrp: r oe l re hi@$e t o r w t . Weryer, data were available - I/ Era Pi& I-, - 2J ?%st o srcozls d01Ear fs~rstes l eat sf Pesos. quoted ia t h i s from conver- Fotlowitlg she s t d a r e procedure used hn t h i s repax Peso figures were gsljfhated [or deflated) to 1968 Peso values GflP & f l a t o r , a d $hea e-rted hto 3 5% us%ng the o f f i c i a l ex r a t e for that y=f. The appraisal report for t h i s project rtsed 2965 Peso pfices. on land a d cattle inventofies of project raartaes at different p s b t s i n the, and by jad&e4c*a use of this data it was poasfble to alucfdate s- of the key trends. Study of a large sample of project ranches (293 or 72% of the totall) shewed that cattle herds bcreased by some 42X, mueb -re tbam b d been expected. Part of this is due to pur- chases of br@;edbg stlrrek which the project was extended, after appraisd, t o cover. But even lezc1dhg prch-ed stock, the actu-al increase in cattle rages 7.2X jp-a., a projected in- crease i t appears that in cattle a d e r s dfd Pot result f stock, t b t fis, its perid&! the rate (zatlo of calves to eQvg fia %nerds)act aver the targeted ?tn rBie cr iapprafral . Bare arft Mbati- E b t a e emscent cattle b o a t o - s b ptd.auetiHr)rt a d dimetl frm the gr.3deet. %.a3M(e~5to- of fbe eatfle, h t o acceutat pro- &itms m t k bet-d* e s -saxe to deter- c a l Milessmrs g-ralXy prespafl?lang %a rbe project af a swl@ &cP &s*d % qmsstts &dieate that eke too& cumlease 4 r a v a t c ) ~ & ~ ~ t t l e l ~ l EE Iarser BS9azee tbgs a i y s i s was csn tbe r-e crf tgvirgp prwail- h tke ~ 1a: r m , ffElCt d the expected @aesfe* V C I I P ~ Q ~ ~c~S of cattle by the raebrs, w e t m d nam9ly hawe been -paset& at ch&s o t q e The @ s t 4 e a t t b $ : b r k f a U ~ the current In- ventas- aaaa pr& %a &&te faeteol.* ma d* TI P e m k e d t a d a e y of prragee rear* ts fa fattea* ope -have trdir. 1~ @2%5&3ftmm%e zs Ess m l e &IXgl frm 3 . q ~ 0% the d ~ rate -- w the key constraint on increased prcrdrrct i 4.mIbba's Beef hadustry r the l a r g e s t possible n m ber of z fne cmtw% breedlag stack. rm t h e project fin=cing was a t a d d to ranaehars bavhg a t o t a l of m1y same 65,1080 ems i n their h f t i d c h m t o q (-pared t o 3 2 0 , m enwisageel) plus d mder the project, The apparent decrease &n the ca2whg rate t l h r a ~the a c t i a rojert 3m b stock has mat - h e e d tmce of b , or t h e i t prdmtfwfty, p r e j e c t tlaolC83ieg. &halt even htghet d also bawe keILpied Other a l t e m a t % v e s ro farmers phys5.callg seal zrad e c ~ n m % c $t mid & mw ek n ~ s s i b l e t o learn GQPIZJ t k beteer e s e p 2 M by the ismst successfapl 1-e ta the J r Leas t ~IMICC~S omes. ~ U ~ kbe te I ms%stm.p,et e a pdtm centemd aboest tee, m d t b to a r e e m and g r d u e t i v g t y . e;lagl?fcalmsS. hawe Qem felt %in, the w d rsolatral a d psrsltutc rothntim. kt i t is dlcst clear that these practfees are -re efb"ectZwe9.y p ~ ~ a l ~ ~ g t rmclam z h ma- 4.a~project t'ksedse, no sgst-tic techYcaP. a d a n a l y t i c a l recWc.;al or ts eYfect5wely &ntrduleed. Substantial a f b a r r s zre t p b w knE a :-& to h p r ~ e r 9the rrffecr%wenesrs ok ehe techged ~ s i s t a c c .  Ib9 efiecti- ~ of the quantity and mix of project ~ n - f a mpby- sic& invgstaents crwld uot be directly as of invgstmeats is s i g n i f i ~ t l ydifferent . The . = t a d d x the one specified a t appsaisal, and its direct relationship to productioa csefficieats 1s nat clear. Iavestamts per bead 0 pastures, ferrcing, faIn buildings at best. fear sf agrarim reform the qr&cullh3scaIInwesten't climate. Mow- ever, h d f o f project ranches were ac4paaBred after the AgrarIzm Reform Law came b a ts effect- Project sub-lomi a and dfsburslemnents were! hra~9s.h at 'the hefgbt 05 the ifear refrom &n 1967 and 1948, a d h f l e pmjece s-nts decltned pagrwly af tea: that, 13tfesrcr& eredlt disbnr ftm other somrces with more Savorable P d w b e- rase sbcply frcm 1 %8 a r m & 1970, ,ftis of ht@r@@C ED am@ ithat OE rer @optslewrsl.rbm Qa dew1.0w a d a r e twbfd h 4 mtely S 5 5 . Ye&, ~k 0 4 return cattle opera- ~cpa  '1Ehe project is located ia a hydrological closed basin with higb ground water, S h e lllgny are still be- made in the design and layart of the irrigated lads, to cepe with drainage and saliaitp problems, this part of the project was not sized in the evalua- tion. Present indications suggest that the prodmetion of high-value crops i n this irrigated part m y require add 1 costly st&-s drainage, and tbat rarketi~g lay fa- ffficpslties, bad proposed to tbe , at the feasfiili , a project of kctans under irrigation. a v a l d l e c~~atribution by proposing rchrtetion of this spcetally of the irrigated portion of i t. Tbe evaluritiorr Al drcbank tad wt w r of che projcct 8rGI both irr mdsoa- tad frrd*) uould ae-tad by - I/ E.rcloaisg dre msn f a % ,a et area and tlf bp 25% of the t o e d irrigated sna, rrs t- i.  e ia the dry f part of the project area has intiag to dare, D a t a for ebe whole project area were lirst tiale fsn t data W e been collected from le area; as expected, and as rage, alhahorpga s t U 1 p r . Weather has warded ower the years, k h g exceptfos~allygu3f riW 1968, ratkr dry b 1969, d very u e E in B970, but these weather variations siteta -u%ficfeat to eqalaiaa, -rstitularJ.j for the selected area, the strang m t r a s t be a e t d perfa and what the appraisal re- t after C Q = ~ I ~ ~ ~ Joe )IQ areas to be f l d - r o t e e t d . 967 qpraPsa1 repor. t, ria%= to US$% at %d dearer t, and ass etw- p- a rt m rnn of tares of spqpurrp d*le-crepged t ta yiald a f m- Ca sf BS$ Y at fa11 deve10 easB retms- p e t Baectare of at fiirse year d B a l l r a e g ~ r t i ~ l yActanal . prEor- % Pre s e d ~ to ~ y e o e r ~ e r as ~ w t ~ a tslpm ~ &B the t a ~ e . 2 1 l i r Brm the 2 , B M b s . / h , yfeA3 aad AaSg9 ertate a s h asere prajwtd d o t tairr! first ~ m 0% r 4 3 -1 t under 1967 ~ p r d s d repre did rmt - 3 PB* e dry other crops ~?iaer a E&CB '53%~ h dcm a Barge scale, d- ha the table, its prEo emps a- mt wXth about 100 %a b~apms 197 es bn 19"1 1 e a St - El &t Z a i l y & s e a 2s q ~ t r d a z jcccc &&QBS. to ~tagbset=- t a x e s stad pro- 21 PAgaxes fer i i l"37P are .kiv&UZe (1~152y d m 2;b wb%e project area: wt&= grfel& were t - 1,552 & s .$hi. d retams were nega- afwc, at 4S$92 p e t kctare. 35 For 1971, g e ~ rthe - 1e pt@Jeea: a m , se per beeare md c a r e c u m were B S S a - 48 The M i r a t b f i c d t to 1 %@1 able fca b e e e g a s t chat ft ~ ~ be2very be d&Be a = m pw %sf d dff- b % g h e v a l e craps kcpaase of kbe c l h c i c siP c&%t%c~~sc prewaflbng ba %be ~ 0 3 - e area, Psajr?ccp: -sof%ti9lm BBacB s a a t & that:, due to d Bno marta&aty h D:& paztem of rigma%$, prafi-h C'I:QPP~- pattern could not be ~ p r c e f d r3.t - t mpp ary %rr%gat-, a m r e ewmAve alter- m t i w b t , =&&& aasa &wrePy affect the som&ater cable, half the rate  The pamse of t b f s project was to 188cne;gye the productivity of majar crops for rt s&stitslPB&m{mtton, rgce, - h e , h a t i t u t ? t m a l credPt to farmers who were bad aeess only t o lUifced c m d i t frm private sources $ relat&wely h e f f l c L a t 8 ~ as a r e s u l t . It was thought 50 h t a r m ] &n the project areas {port&oas le) c:@ddnot ~obta%n therlr cred%t i d b m b o r mmey Senders, and t h a t , c r d f t from she Gaga b r a r t a ; - able were hifililfficbie#t to meet "]8*l$ez praject dts kg., ptm%de k c 0 sa8 seasmal credar ieg&s, fa-* m d -~lrecbizd services (42X of o&-Boa d i , =dewtern c r d f t big) r%ca%eaarab marcgatnay esdit for a-fam hqi cs tB8Z9. 'Total esti- m e & proj-L a e s =re USS42.5 d l 1 b w d m t ; the foreign tr for TBw6Znsbre-%emcrdit 8or t2.5j111, I--tam credit for 2-92. - lSiiasc was @aboi-Iy ik tm early l ea w;njtmrr f d 1 r e s u l t s of the mdcr t k prtoJeet, she @prasah co m d m t i a was to t c s%tmt%m of prajiect far- =ES; $S2 1597ae tQ *y da~hp~ gem of PmiEiq sa Bllffermo Er t mtSLc3pared, d vhat prospects %be pmJbcet kid, - 290 f was em a r d m l y seleesed le (403) of prea;gect Ea-ts Sa T ax-, ehe p a h e f p d reg* ahera d l s h r s - n : ~ - kb & e r e 1 d%sB;ters ts d e b t 9 ae lo= r u & d US$fk,$ m i t l g m by t h e d OE 1W1, But US$@,? a3ElhPAm af &hAs was far a beas5bi%%ty st* of itnr frrfgstfm ptoject.  been -3 be fiadings e e s t that, at least in this area, the av-ility of credit (corfng from rsay 80uoees) has been adequate, 9ad roseaver that the use of ditioad credit is not associa~edw i t h . increased ef f icieacy Ihproject sample indicates that tbe merage, a total capital of IIS51,080 --w W e f itting to a great extent einuation g i v i q them tbe merage iastbtutbmal sources, roduction d y ths general in- ; for fastarice, thtee 3"earS are ly used. Thbs t hrrr not been nlated to thc c d t pnojlect, t ffmnces the %xi Itifio! ai~f4raisaXreport pmject f a m r s from USS5 per acrSescare, rsirbch <eacludIta;g coplr~ectors)thr r& 31, 6971 were to ValEe (about 85) a d To1 about 'L15). The e cowers 46 or r 4OZ of dre s in "Polisla V area. fn an area as folima 11-19, ehe short-ten, =dim-tern, and long-cem camportents of project f i - nancing casts smae do&t on t%e d ~ i r a t s i l i t y of Bank financing i n t h i s situation. a)ux wnclusims in this respect bear out the reservations expressed 2n she when the loan was mder eons2derat9on, regarding bath the wisdaa o C- short-term cred&t %ad the s i z e of famess bclarded i n the pwect. Far ~diua-texm credit, the a-ndysfs also %sac%fcares a 13 sggnifi- dditdoxpaB m&bm-hem fhanciapg and gncreases P.m effic5acy. the Ievef of aggregac8os at d f c h the marg%nasT p r d a e t b e t y of ry was analyzed does not proy9de a sufficient basis to ewalwate the real costs aad benefits of fnereased srtecbanfta- tim. There are U i a t b * that us mcbfnery Zs very profit- * S k m he8-e 96 the? -2% of ia&m dm e f f i c l a ~ g r , but be- @ m%ddIe-s%af a-= prefer t e their depadmce 0 x 3 labor. zar,%cmloan, S u e e rbe fstrative cost pmJect hawe m~unt- ed to a chfrd of ebe a taP s, %t mfght have been =re appropriate to dbsburse fbbs e y p of c rectly ttraagh the Fez %%-&em credit, t b ma9ysts %&Scares that the ~3pprtmi- ties faced by gstajerza f a= ,- do not I--scm Sz~p euPsrPy mrt&%ilept:opos%tfm. fbl TOI-~ t&%r merage return on m r l w -pita1 ( b e P d w = c h a r y , e a t f l r , giaa i m a t o r f e 9 3 l s 52% *&le t b i r m r a e recam c m total wiz;a% 3.s 23X. W s e q w s l y , pro- geet %amrs m& gslsaeprmeurrcr W e a se== fhmc9aI h c a t i v e to reat s aext, and b t is a P s artrmrf r prestie msfderat4as. -run i~tmsbfatcathn 08 P a d dewe prboriay and, fa 2e an re&i;?ld gramdls; e&ereare ciebwstrtl%nta en the eapae&ry oBF e k t ~ e a fmPgaOim l hi-ta, a d adds- ticma& w r a ~ = a e s are reqd Pa the g r a v n e w r k begare it %s possible far tle %&&-dual E rs to mike aa-farm b w e s m a t s to ia- teasif y prdactfm, The? precredi- a a l g s b m a a & s r b t the prcawfs%m of d i t % o a a l credit to addle-size farsets &a T o f a was pb&&ly no2 as essenrfal. as o r % g & d I j Lze2%ewd, Bus cmdsti- may we11 not be the s - 5.n fEOM irrigatbrasa districts other tba ValPe and T o f l m . There may be m y oppreunmbrfes for produetipe hvesr-ts &n other irrigatbba dfs- triers, but tkie r%ional fe=%bLbfty s t d b e s d atrachg tbe efff- eiencg w i t h a%& credft catl Be us& for t h i s purpose are lack%ag, The %="a has aluajs eqressed a wflIZngnness to e x t a d ~ll"edir to these other a m e efficient utilization of resources i n the agricultural sector, and that i t is inseparably lhked to significant isitpro ts in e d c growth, mloyaene and uelfare. If l a d redistribution is a necessary ion for development in Colombia, this i s not to say tbt it is y policy Instrralaeplh to this eud. Additimal significaat b e f i t s d d be reaped from re- l a t e d inve%mentsin N Ia l iofsastmt d public bealtb, to the extent tc3 which these could be the avaUable B i - a l *nbliretiwe n a ~ ~ c i arwl resources. t h that the pace of 1sLd TSdldOtributIOD. 5 x8 C o l d i a &s of ertakstolr workers, soil scientists oiacizlg one. lfad the c . ~ n c e p t h n of og of reclamation and cobdzatioa projects is not -tent wAth a realistic pol- to cope with the pmbl- of m a 1 pwerey. to the problem of it, A t the heart of date de fwto tioas of rural p ia, the basis fo p r i c e policies f o r w b i l i z a t 5 o ~ of resources and e f h r a , despite t h e 1-ted eSEectiveaess of t h e measures, Then, ahreugh a r a t h e r de- layed approa& to the Bank's ccmkttbbutf61b t o r u r a l develop- m t t w k sbpe %n mi of t h r e e p r o j e c t s f o r %rrigatfon, colonb- z a z i m , and c r e d i t t o r e l a t i v e l y large famess. As regards the two c m M s of land reform, 17, fairid redistr%butTon and credit t lders, t h e Bank 3-r its mral support t o t h e l a t t e r , But raot y to the fomer. S l a w d .ts LXB 'the I2westock a d cred3t projects were perbps t s bast on tk d i s m p t i v e b f t e c e of the fear of laad reform. Zt %s t f d tiow far the 's a~arept d s 1bprpt c k neeessbty and prospects of a &sip& h d are r W X y warranted by experaence elsewhere r b = P P ~ . m- - g l a s s we -2 S I U W ~ ~ g the t mst~a H~~TOIXS *aeies or by g.5. A D . pears t h a t X a d r e d i s t r i b u t i o n 1s t%ae ma$onr apsliegr am st l%'itsely to a c c q l f s b t h e dev- r d e,bJeeofpreg ;of 1 . rn sbBd PjgBPr estl-res of s b feasible ~ i of x Idbr89g la& rd8starShtfm9-re werk$% c a p i t a l to s, d htses m w f t i q e m - d e ~ dd~3-1 -- cmld a p e with rhgm a gmesa&im. ff $5 %s & k e r n i d t h a t the 5.m- a i rd refom iz, ose 9% tbe pc~lf.c%es requiried, -Id e f a r l y shew ehac f a faw~rssa& a p l i c y , and strafe t h a t &r a f d E e s y e m t r b h t e fa bts h- f , as tb% other 58. %sdetcm*&d t h a t Paad re- disst&ut3m is ma d, e&m ra set eb afte-tP"lre ~lgZ~si~ab: SO tIP&preblm ah mta1 ey a d d e m e f l i a t i m of rasr;rorlo%rp,should Be ewlie%tly femIaeeP1, 1 d relorn prc- , tbe S a k should ~atrfbPPtZmto the s g r ~ e u l r , prfov t o t h e wtfm of t h b ~ P f q m , the f d m z : i = of mall far- eule%vat£q hrfa e r q s for e q o z t , h l d f a has a signif%- -t p r o m t u l for ewrtgw vegetables* faAts, and 9%-rs. These agacg saeb as t ~s%sCed tb dev- el* pf~jeets barp servicing I she e2PXT%?Ts agris.arrltura1 processing t ~ m r nreqaimd ta susraZn 5Ske: pred~-~t%cslj of such h%gb waisze crops. - if ft is OP h t e r e s ~to note that r kBe largesr part of the groups faclded in Bank projects Ibceg, cottorp, rice, soybeans, . scsrg'mm, sesae, etc ) have relat3wely E m apBcs?r=at generating ct8gffr;c;ients. 3. %re qft9siis <refid meiEul3.y be placed, in the course of project aplpraisd, t k cwaratb.we aff%cb.=cp of a PI: % t eewatiow pllky Lnstru- cbg, rechnSsaP ;issbst;aaace,sad es &n public tency o f t k o p p r h m i t l e s aGlQ tves awaflable to t h e W%wXdm1atreptewur d e b the object~wes9% ithe project could $g? m are ~=1Pe%Cly =cerbta;Bad. F h H P y , the relatimsh%ps betweeam tn- creases 3.n pr&wt%aand gxlc- rn m e ? haat?, hreases h techsirail pmdueC2vity and c le eiff2eimry m a the other band, c s ~ l d be amre rfgor-ly alymd, 4. T k swemBsgm ef prm$er&s i6faOdd be sestrtded frm a general reparc mt d f s h works to a m r e ma- 1 s mjset Emnitorb$ 4P t sthe ~ r o v a ~ tn &be of better 1c18e ac+%rad l a 1 4bbwf9itral para- =terse - 4 . fm &X&ia, a&tb@ cbe m a i P & i l i t y d ~ U t of y prducltlm &ta nr, t h e fa= 1 et r pi i%is l s;atbfaetorgrs t & a r m s w d f = aggregate data far e k -tar: as a *le -Id be fdorably -ramtail. Sbce the & a m h t %~g,f a d the erEfsct;Iwmem~ of tkir iqk~mhat91m er&ff sotad- of Rww the SeCtQX: WZ"ZBie40, tw k k tecbbed tam 63%. P  CHAFER VIIZ - SOCIAL I?WM§TRUCTL. PROJECTS As p i n - mat in Captler IS, the Bank l hgr xecenatlly become ds d h k h we tbe 1950s considered !taLnty about their ficulh&eshave been Eacd Ss dew]Lopb- appmpr&ata pri~jjenet~, mb 117 beware QB rtke weakness @E the re ke iaar;tftapt&~as %ma A%Choa@ efforts were @ b r e d2 d3eZds i a the eazlp a d 5 n others E n the dddtle of the decade, there are mly two prajeets water -ply -- *e are a m a t a E aEaB r l -- me &a Ipcd~icar5ona d one Sa y d m w d stagre o f @at@c~lt;ZPQn~ 'Wr%s cbpwr brfef61.y fee- ia did ft b s beca bmw1- -- b l adr -- W d ace;i.m %n the three maim social fields darc*9s%ma water supply a d public health h paSeelar q b s f s u ~ a n the mo relagtiwly adwneed projects, Xlaa -era1 of 68s re-16 iOlsle;EE. 3 eda s stbe 19mo &3te Bank carpa- mat& m a ? rh B w &-tfsgsl s~hllly in the rural the p o s b b l l 8 E y of making 1 haeiikihicr was b e g fderd, an &'llie~~tfon s~cfiatisst was 9,a~:ldd Bm 6 e m%rs%mm a 00 rwiw b1&b9.6 Develop- xt%c1*t& &a S ~ B L &kre B srP-all& ~ ~ asst- d'%ch k-9 work in the mumtry mrr&, *rely due to the shortage of qmllfibd wtm-k 2m a e &P sf W w a t b m and to budget strSm=Pes3 h e e-tmLEy D s & m a i m ptojaet war ~rSeweBoped, f~rlIwBw ~kps%ex?itger oamb'31f prmgdf- t k emsCmell;i 0% large c q x e k a o 9 , v e sebors'fl %n c k m j o x eft*$ ab e b iemtm. Y k B a d sade a P m a of W 7 - 6 dll8%m 1Bm3 foxy I%$ fer s ~ t m 8 t ~ t 3 l o aoT n tea su& ss&ml~,a d a a ard 1-m oB dS16.5 millfan b aa Jum 1970 gar a further nise, w a c b l a , ar&XIe dgIwt%kat@s Res de Eduaeion te p r d d e S&X year swc&albr;erJcycle d ed-t%oa -- w&&%a -- a~ilgw r dour-year Basfc cycle gxesmr mrkety of choice i a na s*&Jeeea t b n avaiPA1bTe at a f s lo a & d . t - 3 n awcbi; e ~ b s f r m tecbicadl s&gerts, A 1 a %= te&afqageri; { ar l?w@of eqa Olfw semfces, e l l group pki~,jeera,eDe.) were e sq be se of fqroving fie p $ i r ; t a kgE &-t%m a d ~ C C ' L C ~ S the %I~ d r q - m t c a d repeaher proiblm dram d i c b t k mldbrn school system ihas suffered, The schools were tol prepare gradmtes far darther spechlified -cat&-1 kx:ainlng, early -1 d t h m - ~ e - j dtrafnfp: or regular drversfty entrance; they usere lip @PIP projected gaps in the awagPabili- of traLned manpower in @oldb, es a ~ i c u l t u r a 1 ,fdljserhl a d rcdal f i e l d s . rn ten s e b E s ; d r tbc f i r s t pmjech were expected to add 4 8 m c~, , totat %g P972, qoimliemt t a g anie9lrI-y 20% of tam1 39158 e m re faLatPg close t o scbedu1e a d wa p c-lefaa% in the first b B 1971, "Bght of the erbcmls md Sn 1970 a d a119 tea were ~ ~ a t i a a aby g, M r f l 1W$. The project fs h s s ' h h t e s - Enm-1-nhs reached Esgibec-ast) ain 197%. AppP%icanks st s ~ e t S a a e samfmg froin s w4t5& p3a&rwi-;2gr bad l i t t l e p b l i c em&- s&oo1s, tui- . oL a we - i &~(pLmnt by to~cUPty afford has t i a ~ l esdytga project& ma- ra~strfiia2 sad ~~~r srm i E 9r01ied % e h 1s m r q l y r0ateue.d W ie;rrfw%wl% p r & l a to &ere b= h a & h y s im tba procute- mat $I&hsm$lief~% of&@~*%par s sr s d LP & w e d m <as msiaL P a s w e t s af the p r e @ ~ t , far a%& dsaars~hl $&Pz~b s h e n ~wida56Q by US A31.*l, e- &&! q P m 2 "1 P i tdeEays, d f e h eswcsta11y af texts D s f i t t:k m eartz&eaEr, Tra ems h r t . preject ac-fs, &It-% @S A I D s --- Y$:ack= b w e traSmiq, meen ac~w%I ay & g a s i a w l d kw sereag s rs a s s n % g dto %? &I ? pr & stdmiks, as a f &a teachers che HB-~GUO sm ahisZs~raeot~, pEtete8 fe %y 19111, h t eBa$:%r broader f k a f l w m m rsn the rest af the dwa- tz-l sfst= bas sc far k e a -84: f isbait& e ~ c t ~ fm 4 , watiws re;rsmo = i ~ X y te Lmter-agency cp6~1dizxaeior9, m 2solar cet+asaz;rr. X, - i f &lays rin planned "sa-lPBtem a ~ ~ a ~ e zsdtba p t sr t b s t i ~ s a d persoand c31a;nge.s in 8978. ss BfELLrrult re appamntly g d l a a l l p overemae. E 's t r- tker are -tat pla but h Z B P m e p t f @ m into the n a t h m l educa- t f mall q s m of tke ten zww & st* a d the WTme under csnstru-ctisn G-ld s & w P l y be a d f e d , &aof the seg:o&r~j, educa- were djwitfms of b%@prbrsity at the t h e ttd, a d sesw &a zw, Smrtly a%terthe rdlecPri~a & pm*ta t A s t d y by T,PI %-f\uPXe zishowed hbDt t b r a e s @f rtrCI fa=@-W -a t&m, wikh knz~rfbtedefgad s, wet&? p-aet for s e e o d a q armlys-irs by C,W.5. ra *cr- in hggher %m ~ S fW bfd k 3 as srl%ZQ wer, ft %s too mae?eti r %e'bat# *rat&% m m s t r wi3111 tam sut ~ 5 t h full enrolrents and it likely teat the cost differential w i l l be more than eoqepicated by the better gtlality of education offered. Illollllcipal w a t e r supply sad rage is a field in which ma lor deficiemcies have been identified by Bank @commie reports E o n the start am d for which thc Colodira aathotLt rsirteatly souaght Bask assistascat. FksL fiaaacial st+uchnc the sector a d tbe Ikanlc bad 3 at that t h tcg are h l Illl&lp am approptiare strategy tom cle directly abut the r r l l e s t f recrfhiag b h n c l a l 11 a d d i m r  dich was cmsPdered too part i n eke leerdimg o;ltPsaa. hrgest a d fastest ~ w f a g afEect rt&e largest re m o r e eracable, a d second stbllL suffbicfently large to, llet c i t i e s to % k + csr9rlf m m t f P ~ H c ~ st taa-s 8 d ~ g Smge ~ d ad clgerpaga fs t h e f itm a . "fftse BB&'s mat *tgtsta te t b ~ ~ fFstPt~ti-3 a of the 8&;ogota rm agd asarijt, d i d 3 5 s m prlta~~cted fta the ask& the =& to beBp prepre a publfc health project whfch at m;ight sdbseqwWly help to ffmtw. A m a l l technfrcgl a tBiss%ion was sent to identbQ a E d 1 7 plambw pmjrtcie I tn iitl rSn the Natlioaal Health PPaaa; it duly prewrd a projcch te, cover train%% a d cmstmet&on od itrahing facilities a d b l t i h cea3tgrs r e ~ 8 r d for exptns&on of famfly planning p&P&ae hea1Qh EmckLons, at was m e psewad to c a p td et;e&aar?d course D E n see t b?~ m d s plarnnfngq' b c Budd o the project wver red, as part o f ~ B B far m a:p a r , a wa-?bmkfw cqrtaSaszP'~~e revfew of tbt whole publac k a f eBa weeor f ra a'8dhby Dr. WlLn a of Pam h r f c a n Health Orwmaz9ic a m QPrnI* ma %fs f Lzst 1mn far & fXypglrmiw [bn Jama&gasl) mlp $as ;Bum B9?@ad e ts hawe -timed to be expressed b fan: the m a the hm&r f &eld of public health. St Pa s&sarmsrrrl a . I s 9 df ~ u a r r s s b mwf Sh a l d l a , m n & s for Z d I y pba11pnBa9g la kE a v pm;Saca:%t d&t B%mw, *wr~ielcsmr the ease does D c-%&-ra~fms Earnrim o Ewther broadcdwg of polley st Cbe Hlft sector. rkaer at emsadera e appears to t j & ef gtw~1-g dewel in the public B%B a d %I r e e q t t m fa E i& tl .iek* W& w r l j the Wa&rWr of W l t b 841%d that he .ll;r$&9# was fetcrested i n bw3- S h M& Lm-aslw& fa the maionial Wsalith Plan ira t d e d $8 e m Z l D1e -re 96 be ach&eod, to gnhr&am the jPbadgs hflzamse %pa insafkgl.tb-1 d - 3 a.ss. sd to gIwe r pros- cmtaiauity, Preparatfm rsE t b F b n gosl2f b d reweald of the s e r h o imt%tu:9mk w a b e s s e ~ a d itktrIfbt~fm1el &wet%= e k wcta~r,ea%niw that poor wallye is presently & & a i d for the fasrirly hrge sbre of a [abma: 4%, half privatz t i ed half p&tie] gmi* t@ Z - : L &. Fer %aswne,cm'ilp a t - lm i zof gu%lic eargendk- tmcs m M k t h k e n @ k e zo ptewamt%w d i e t m e , -whereas expert sd.rtf$:c s-asts e b & th%s shmxd Bg$ fa tihe mf@gBo&d of 25%; as a result, fer iasmaw, %-mitatim ewerage is pae9sently wry Baas, There are scriaaaps; M r sbmges a d lances: three-qarters of Ithe country's 9 , W - d d hetors are in Che 'BDrrparUnkal a p & a j l s , semi= less Elmm a t b i d of the poplatiolc; there a r e five times a s many doctors as there a r e trained muses, a d two-thirds of these aurses a r e ia the three l a r g e s t citbes; a d 1 1 a r e greatly umderaatilized, B special problem is the l a r of parthllly a a s t r ~ l e t e d and un- ped hesltb facilitsct xist. An offlIcial f n - a t o r y revealed 850 sue$ buixdingb, h t P t as e r e s u l t of p o l i t i c a l pressures o r iaatcd e f f o r t s of local charSCg !boards, h e e a t b a t e places the investment alres these structures in excess of OS$LOO dllioa e v f m l e o t . n t s i n &be a9Zocatim of resources devoted k2lag: quietly taaade; the assist patsOcuParly the d &math rates are ,zd 3. Zbre Mnik d & e usefml2y coacsidet Matmi- a d a s s f s m ~ ts train- ing %a &r -rext tBsrs;rp the direct s of e'$e temeitg, -(e.g, u r i l b t y or B&%nistrygbebag f the rest of che seetar, ED71 c o l ~ l dp &or 1ewl by prvlid- gag ecturses atflity a d projeee pne~pglriatfma d analysfs. f its maat Bxa pubBfe rtiiPe fnstritslt&nal cp't1gamWhP0~1l1 a d mrclaa.ica1 expertise  C W R IX - IBRD INDACX ON COUAIPlIAN INSTITUTIONS Chapter 1 -hasized the traditional weakness of the Colombian state system. The Bank bas given a good deal oP active attention over the years to institutional developrents in th9se areas where it has been involved. This chapter attempts to ident'fy t 'k impact that the Bank bas had on Colombian public institution&? and to deal with the questlon whether its efforts to affect institutional developments have been effec- tive and generally desirable. These questions are s a e of the most dif- ficult of all those we have attesipted to cope with; equally they are cru- cial. This chapter must be taken as a first attempt to deal with them. S a r e of the difficulties are of quite practical nature.: the vast amount of documentation, archives and correspondence, that have to be reviewed and the large r of conversations necessary even to get to the ten- tative answers ve shall discuss. But the fundamental difficulty is, of course, to know vhat path ins+,itlstiomldevelopeat would have followed in the abseace of the Bank; this cannot be other than partly a matter of judgraent. And then there is also the question of what criteria of des- irability one adopts for judging i-tstitutioaral change. In this chapter, focussi% on the institutions with which the Bank w a s directly concerned, we are reainly interested in the econostic effectiveness and efficiency of an institution in fulfilling its assigmed role and in the institution's own strength for growtag, absorbing further imovations and affecting other institutions. The extent and direction of the Bank's interest in institutional aspects of the projects it hss finanted has varied considerably, depend- ing in part oa the nature of the project but eqoally much on the particu- lar staff ers involved, for institutiorpal problems are seldom easy to diagnose. l&tturally the -in diate 3~terestof tke Bank has been to develop effective organizational raeehanigsas to htplerpeat a d maintain projects financed; but ohe Bar9r's interest has slo~~etimes gone! m c h beyond this, Also the i d e a of haw to fake an organization effective has evolved rnuctr over the years, as will become apparent 5n this chapter, At a broad level the 's contribution to institutional develop- aaent can be categorfzed according to the nature of the BankSs iavolve- raent. First, there are those institutions which would probably never have - 1/ The private institutions with which the Bank bas been principally in- volved -- the Fi~incierasand the Paz del Ria Steel ny -- are lareeiy left aside here; institutional aspects are covered in the resfsctive chapters. exfsted -- a t l e s t i n t h e perid r rzdl e -- r study were it mt f o r the r o l e t h e Bank played i n their creation: CNR ( C o l ~ i a m National Railways) fcmla0ed i n 1954, 1% (Iaatercomectisn C ~ p a w y ) bounded i n 1968, U t i l i t y T a r i f f mar&founded i n 1968, the o r i g i n a l BZaaanfng Offlce founded i n 1951, and, possibly, m(@ (mu= Valley Ghorprafion) founded i n 1955. SeconaZ, there are t h e m v e m e n t Y f w i s a i e s where the 'Bank bas been in- volved i n reorgaaization, e i t h e r heavily as with t h e H&rsistry of Public Porks lor s l f g b t l g as with t h e HZndstry of EdmcatSow. Third, i h e r e are t h e smaller estities i n which t h e Bawik bas been fnvoLvedi t ~ o greater o r lesser e x t e n t i n r e c o n s t i t u t i o n o r reotganlzatlon: mainly t h e power and already exist- water n t i l i t i e s - F m r t h , t k e r e a r e tape imtitakiozas ~ h f c h ed and i n wbCcR a special o f f i c e has been established t o handle a Bank Project: the two matin agrfcultraral ins%itatiens, CaQaAgrarfa and ZNCORA. The fmsa"Ptntio~a8 e f f e c t s of Bank lendring on the four E l e e t r a g m s s u b s f d i a r i e s co *Lch f t laaned in t h e 1950s and e a r l y 1960s appear t o %i~awe been fairly I b T t d . Sost h w r t a n t was probably che requirement, fm each case, that agrememc, be wacrlth other ;compan%es fas t h e region a t :p far r ~ ~ t i ~ a ~ ~ 1 ' L i OE 3ne r ~ e ~ t a t & o n J d i s ~ r ~ B u 'arrangements t:fon before sigmture of t h e lwns; faP1 anal tian s f dacille$es was r e q u i t e d i n P ~ n i z a l e s61950) and Bncar-n:a (19513, but not I n -15 (P950') and Car- tage- r1963e =here the d i d d d respns%biZities canrtinued ts cause rrraeble, in later pears, S w ~ n d ,the Bank rqqaired $ m e s t r e w g t h e a f n of the BfnancgaB and eaapineerbwg: eapabflftfes of t h e rmpanPes, T h i r d , t h e cowcnaass regarding finamSaP gtearfomme, though much looser than those that. maBid semera81y be requfred tday, probably bad the e f f e c t of .making saalfffs and rewesues s m e ~ * m t hiigkr then they wnnld otherwise hawe been, PB s e f t l I m d q a r e fn terns of a rate of return on reva1ued assets; a s ~taentiowedin C b p t e r BV, Thaqs, wbfle t h e Bank seems to h a w e had same usa- EuZ %=past op. tbsse arapanHes, the impacr 2s not very great. The Wgota and =de%lIfa P m e t hpaniers, EEEI a d 5PM, w e r e rela- tively l a r g e , oucresatf:al sad well-mged c w a n i e s &en t h e Bad came into contact with t h a . The Wnk d i d suggest %;hat tbe b i l l f a g a d tcch- nical opraeiorzs of the etmwnles c m P 8 s ~ t l d same h p r o f a e n t and modera- f z a t i m , and t h e cmpnfes accept& t h e s e suggestiom- The Bank Stzsisted en eanternaP a a d i t o r s , eseabliisb9It of Financial D e p a r m a t s (and et- cPaP Wpacaents i n the case of EEB%, recruimeat of well-qualified fiaancial a d , for Em, a n s i d e t a b l e stre~gthening of the technical staff. These reamendations were a l l agreed by the caapanies a ~ d h- pleseated, though somet- with delay. Basically, though, o m can say t b a t already successful i n s t i t u t i o n s matured and &-roved, becaning less dependent on particular individuals as t k i r quallfged staff ex- paQded. The issue vhich caused R U C ~the rost d i f f icmlty, t i a c i q r e l a t i o m betreen these c i e s and the Bgnk t f t a r t i l ~ l l a lrelationship witb their respectfwe nuaicipal a u t h ~ h i t f e s , Un- l i k e the other -ies r e n t i o d , tkse e n t i t i e s were m e 4 by their aunicPpalities. The illarrlt argued very strongly i n the mld-1959~~ when discussions f i r s t scarted, f o r their e s t a b l i s b e n t a s independent auto- mmcms corporations v i t h Boards on wbic bold o d o o r i t y of the seats; t h i s vas t the Bank's re- d e n t of other f a r lraeh of the four there vur ooaoiderab to follao the 81 unified u t i l i t y caapany, the Ttietuo ies have each c~lipdeted seretal Wk-assisted proj- sfactorfly, aEtbugh waeQ delays, an3 they b v e strwrgcer f i r r o ~ c i u lper ce tlrrn eb t L l T laabia, a19bargh they fell stzost oa pe Bank i n the f i r s t half of the 1Ws. t s ra4e kavc g i e a rise to two d i f has been insufficient coa~dtnation between the r%vm ad r rs. One sf avrold o f t h %he Bogota Water e coordfartion. Second, in both l o w e r 4 d d l e classes, has wan aa inereaslng nmber 0%seats on the Hung- c i p a l CoPlncils during the 1960s and n o w bolas mjorities om both; it fs nst happy to see the W r d s of itbe municipally t cmpanies dcma5nated by matside business tmtereste, %exe pressures for elmage, particularly ia XedclPfn, where there are currently t c . ~ Boards -- old and mew -- a d the issue is Bm t k r o ~ r t s , It is doubtfuB bow far I;& agreed Beard sitioa h as cmtrtbutd ta t k nies' perfom- ance, h t 2tr: a bdy a bly b w e =Be ramded es a little easier to seeare &am -would othlewise hawe the case ?(contrastCaI f, for Sasmnce) send it m y b w e hePged prevent golftical srtafffng, eorpratSm, run along commercial Piism a d resmc.lble fm tke whole a l e f a n railway neework, was a key ebjetTve oh a b m&'s 1952 loam for the Wg&lea Valley Raflroad, m e mlmbgan ~ w ~ r b r i t idelay&m -3-ntafbon, bsf the Bank press& far aces- dlWd later d w i s d on the wrftlag of the charter l a h g h it: w%erly insist& am bad- obemer status only on the draft%% c-frtee); tBr charter was ffmlly p-lp'td %a &toter 1954, and the ~ dby l-rgg%ngfa11 hpl-atatimB h t Internal organization- ;P3slnk f o l l $ ~ up al saacers were left eatfredy to Wfgan-wid, the engineering consult- ants r b && bad suggest&, A f m r the Bad rewstdly proposed that aieetratnkfng c@nsaslesnts be o b t d i d to get ratliuay records a d acewnting o n:@ r zmre satfsEaetoq4 b a o f s , -ice, Naterbpse was hared -in 1957 but d i s e h r g d rarkr a riilg i n 2958, not t s be regfared until, 1960 by img syseea anto salztofaetmy c-ercial Pfawr. Meaneirae, with t h e AtSlsa- tic Pdae f i b, tho -3St urged &t? GmermenE to graat the raflroads Euller aam wtticu'ilm'aywiath r e s p e c t to tarkffs, or zcs provide larger sahs%dies. The GWiR suffer& SLSBQB~ shortages of cash, &Ic~ delwed project a e e u t i o n ;ad red its efficfoncy, preventing it Erma hyB- weseaserg spare parts m?rd soraet-s requirfang thar it pts- r h s e sgnpplics retail rather than wholesale, The ?arsons Report of 1961 mde suweslisns for srrengrhening in- term1 railway clrgaafzatiosl, but apparently little w s dsarze. P q l l w i n ~ negotfatSons w i t h eke Bask for the 1963 railway rehabilitarfon loan an Executiwe ittee of the Raf1oa-y Ward was establbshed, tc try to  ice 3ecfsfzan adac-acjioll W w r e m m s icreaited,to e the! railways spsnsiwe 80 custmier requirements and to &v- fern of trafftc, The Exeeutb ttee was shortly aban- dlsnd, and r i a l Wpamatene ap co Znm had very Pidted 9 suceess; eb 1 % oZ ~ senrice of by the ral3.ways, w i t h long delays, g x r r p a i e mlrel;iabfliw d fieqsneae t h e f t s , have rm1ned haport- a t b~9 &fdw L I ~ c the b % g b a p ,5rrespecitiwe of rePaltiLve costs to t k user, -bar e -- mrtfclahrly ag rrilc'fr -- tmr been a very s t s r i a problm; mwerdale a d mlgitts asere brmght fn l a 1964 to help ea &his bat t h y were s b r t f y ddbse-gd am3 seem Zo have had Pitrle effeet, E%%QIY~C ae f w t b t u t i i o a l dewel d fn the s e e o d b l f 0%: t k l i W s s d e b large q?g)aml th Bofrsraf 1, which has p r d d d sc~ersnlt m s of e-ri-d raflwia~n ambertq 30 in all, W a w taeic3a~lL2z& bgrdfrL sep-uetae was liatrsdued fn 3965 at t b 5 r sag- gest%onsand %a: k ? g p l t f v e effeer on re-ads. R a i l m y staZf has ' k sem rdmed fraa a 0% &bermrrhe s 8 , a a k i q m i a Pines a d y~tktct fng free frm Atlantic line wmtrpmcrioa, to a h t 1 1 ,W ia 1930. trr~dnritrgprogram have k e n start&, ef%etfweEy koz: the E k a t a h . Sofrexabl has deweloped a c m - ~ f e ~ ~ tfa& f k wz@hbilfatb@a ~ a d =Par:mwe! gmegr;bfn a d rwrgmiz-erl t % ;rTceBseawl r? M m w a g ; ie: h as also %iarW mt a phrn of preventive minteaarae fet mEBfw s e e . But its efferts b w e b e g hapzrrd 8sy Pa& of q w l l b f e d ~ T - % ~ o P ~ r = e B d by tLe;Ir &%version to -re h- &fate grr&l-, such as chat o f dard trs, wlaieb hawe k e n facrceglsfng, h e $rep:aE ffprw SWS awmqe ob feat desarfhnas a day for diesel Bax:-tb.eres rzloae fa the see@& WPf of 197Q. Fx-cialPy $be mf@=fp~;g! of the raifways 1 3hd - scats? 5af)rovent the f g z t t a k k ~ e m & f e d bles s f the P S O s : e%eywere able to c a e r fnretess c h t g t s jiitn 1% adad 1969. b e , as Table! 9.1 s h s , the EZmmhf a-ating ratfo @twig a -TI? famrable pfctlare thaw mast ocher agcrratfq idieatara, a d gaePIBBg aa asdafy fa'g~gtabde one, gPven the imfll~tima d t & redg3~akaisrt:f.o3 of m1- rted railway assets in the &lame %bet. Frm %be inrsimtioml point of vfew eperaitioaal and in- vesmmt pfaamiq seeas ed h am r-ined very weak. Hs"nancia1services, which rccefwed awe3 asteaelon fm the %akl have i q r o v d greatly h e it is m a t clear that f i n a i a l a d techafce? reparts ?ro -nag-nr are ade- qwte or that they are &Lag p t to g d use ira the mnninrg; of the srga- nizat ion,  at that t h e , tradsasthrbs ia ereatten of public ia~cjbrent precise. Ibc B8* in t tbs Caws Val1 ti 1955. .isas in 19% .nd 1955, h e rare that r k e rgsd that ft would fimmcia1 assistaim! to cbe C ~ f p a t i m ; ItbSs helped ta secpne far me Wrp.oratioa the services of the &I@ssgsa ~ s b CSwe I3Xrector a d i t anay have gas Pk291a f t a a z y t+-ap- ~ p r msc S,kh-. arr~mdto - 6 it5 a b-a resprntb~~ j~~ in- Valle, a d fmws &c 2nfrastmcture maa amre d e s t sale anctSdtPw b w e k a lmgelg has carried mt rme usr- e of Ertiga- ia its re1at"a wftk the ewftges ral osc,asf.lwss The Wniaflcg oE public Works The M f a P s e o y largest s f n g l e ' P d P f c Works %ss c f f ~ ~ t f v e lthe fim e k fw Wlmbfa, k f m g the acueetpfent @I the first created] and a11 "t hBf-ap loama. It - 1 effatb~ with this mnis?tsp, s t d l i l only rbtana: contribution that eb tar mde to s m q t b m % q p b l % c sector f w c % t u ' t i m fn the emntry, &sides lmm, the m& dwPg=ltd specks3 represen- Daistf~e~r h9 t b % & l g a f ~ t qk%& 9 , ~Sg~mf W $ m t ? ~d C = ~ P % ~ & S L ~ ~ dt per- B, awad c h - 1 d P m t e s use e Btfwe bi&gw prapc&wes ead to in- memaifmk%@mI re M9miskm Dar f t a Ear Pesos. Apwt e m o d l i q a rasid-t egC-t t o s o p m s e %@ark. under Baa QT 1958, tbe BBanrk rwk .nag, part8cuIas steps oB m Braotf e m t w e er &kJlt,fs t*, amrtmrtly 8atfapfiSed wlth tbe rmr@antfmt&m af a;& % t ~ f ~ @ v m p o d r2tlaady t o be u d e r Edlfar d t h psoblienar~ h b l k were c cek a ieeJ= wsb? 1~fm a a m % r, $ I&by tb the ~f the second a1 cfeare on -%st %'be m a i r t m at the t h e ibftities b e p d &med a d h%tb. E-m ra%1m9sS prtr and *r r&iplatLmJ included in s r k f - h for eke s m r ~ dI-@, was that I rrleparake &pa i oE W 8: be estabkB$sWf s P aobstw BPPth =partate m ~ s t t r u c t ~ oand w mime c df~irirfm~ E@rs;8m ; rtS t@ be r~g,~Yt@d to b l p ~ 5 t h the oaae%mreoa. ~emr T k B&m%shq afgd E k - a jut i ekems largely to hawe Itward t k e d i t f e n s fm r a r ~ n t the m k fmd eas8&rable d9ffBeaEey H a r9r~"kmiting d~tppt~%a rto, Eve-rpcally one or ;rvO tes were diilptaiad, a d they wrk& sa try%% t o set up a sayafnte- m e F:\tfent%ta8Tf In W w d t r 1955* as a merq~isfteob the M&% $tkird lean, ra 'B"tasfrdes~efaZ m r e t was bsszad ~ t a b l f s b b a g a scp- arilre Ihitb-2 HlfgEaays; bhtsisfm bm the H i a f s P t q , to take respms?lbitHty Ear 911, aspects of ~E@~P&Js, incladfag a c m z n e b ~ .  Bov far this Deeree was actually hplerented is not clear. Bela- tioas with t b cterimrted bn t k follarlmg l lon tb. The road pro- i n afeer s Q ~ t c a n c of rhe third Isart, i n June sors left in 1957 and 1958. Weighing scales 1953 laan w@r ts agaimt en- dorcacnt o we deteriorated g n r t l y , so that by th d of the ported tht the ruads built oadsr the earlier t h r m into tha picture Prfth a proposal by a Bgill team for drcccatralfza- c hired a t the md preparation u a result of ich hsd film1 ptcsrad f'or action, mrd a d su . g r i n from 1964 to 1969. Ttke t u m i n g point csle with the aiev Llerar 6ov-  ozss othex 2mportant contributions. ed a redared a d gadzation scheme for the Midst-, of &hie&the m it acterbstlics were to have M a i n t m s e as a s e p a t e de reprting direct to the Minister to bale a - 11 eqfneer m n t , separate from bath Cons- a d Miatew=e, Emma xhiceh engbmizezs ~0121d be drama $or each, Matemnee ?ms a major of tbfr attmtioa, An iaqmttant trasn- fng p ~ ?ms ~ i m 8-stela plan was pte- pared E m w s d tfcms, a rcvbseit or- and a pllor prctgram was g d bid im ~ D P Bor~ two N w t m e n t s bur Ps stdll qtn!tte aienwus. e sucwcssful t h n all She tmaet- By the m r t i -rtrr sai t sJngle fac- t= wias &beSate hgs rad?irress to take strong that t9se path was prepared for % ses%&nt bigby mat f r g pga 1964 to 1969 sad b d rllad Bbi? efforts, con- e %a LartSn I?e!rfca, and could %a spite af t k p a t s , ~ ? s ~ c i ( t It lkp 2- are fear fraa b f * fallg re- are ar%ll weak. The Hin- f a t e w d f f e o Hr -%sly b e tu ra p-aed -hers -- -- pslzicdies ap;rpatatly and is e d n l y d r ~ d e a es t a-fn-rbng t - ,t o ~ ~ l r a Es &st cmtruct-ioa proj- ects are s t e l l chraerer9d by revere delays, i eaaa~:j is fri o rn a year so %wr ~~PLICS The . cmmaetbag a d BWftsg prmdosres appllbed to s 'kalpiw to fjimaa apw~ently do not apply to 9 r t m prajeets, TFK) Rev U t i l i t y Institutions i n tk 1%0s The l a t e 1960s saw tbe creation of two new institutions -- t h e h- tercmmectioa , BA, a d ttre U t i l i t y Tariff d (Junta de Tari- fas) --i n Prbose f m a d a t i m tbe played a role a t least as eriitical institutd~ns are s t i l l i n a very a s i n the case of CXit and CVC. early stage of operation, and t h t f r u splccess w i l l depend on ev- ents yet t o =ern. rather well t o date, a d both h v c the p o t e n t i d f icrat comributions . In M arch 1963 the badr todr dce basfc pelicy decisioa that, i n coa- nccticm w i t h frathu IePdimg for pmez I n Go'LabSa, it s h l d consider the advaatsges of am major regLom a d , i f ad- vantages were signif cision, it %IcJli -st e m of eolabi.. But c diplamcy by tbe As a r a a u l t of tha Bdt's detciriorr, the They also agreed %be prefas%bPl- The great d i f f i c u l t l e r %a bri=fng a b u t c b inzercomection and the 1 - delays which resulted mt so t k technical d i f ffeulry of tbe t h i s point of vfew various cacpurierr & a -- d t f ficu'lt from h a fta tk s m - f p begiomlist feeliugs of the d .their cities, a d it w8s mt i n fec r P f s t r u r t of me another. A t ont pofat CVC was tb mmin obrtaclc, eul. to get f i m c i n g f o r Ca- liw 11 and feuhl tturt it would be a t the receiving end of an interconaectfonr l i n e urd hence eat oa the o t h e r s for p o s ~ e r . Later El% m s the bigger obstacle, ly reluctant to s b r e the b e n e f i t s of its faverabic h;pareelcetric slter with o t t e r regions.  The keynote of t h e Bank% approach was t o raise questions and sug- g e s t alteraratiwes but never to s t r o ~ l y espouse any one solutfton to the tecbical a d o r g a n l i z 9 t i o ~ I problems Iinw01wed, u n t i l that solvtiion been a b p t d by &be des e l w e s , But t h f s was backed by ftm adherence to she pri e of iasavacfng any prswer p l a n t whtch on in- tercmectl~n w w l d m k e s~perfli~31c(~=; amd this pr;inriple dewelnped late':, tbe C~Pmbfamsdelay4 act to.^^, i n t o a reEusal to provide any f u r t h e r BSmrpcfng far r pPaats unt%l agreed sltegs had been taken, T k ormfzation study for t h e Bntuer1conaectfm, contracted with ~~~~~~~~~1 West Semtce ed i n n June 1965 t h a t sncwa sad ace all new b ~ l k trammLssPon and t e e accepted nh5s rec ndaklon but f t fag l- ed -ta agree om haw m a s h i p of the new c q a n y siwalrd be dfvdded amongst t h e end c m *&el m e w g ~ c a S a t i m Eareflftfcs g ikheoa fn t h e plannIing Btage -Pd be b k l t bv t b i&fvidmTPy and whleh by the llew empony. Fin- ally a m agre-nt an prknelipleo was reached mvmhr 8, 1965, a f t e r sr ifrm -es%idtab : !eras, w b a150 p a r t % - e i p a ~ e dla s%ga%q tea n t - There were stflP dfffaiicultfes t o be seso8.esd -- soch as re1 -- y a d a p h m n t af acceptable s;era%ors t a f f m d &t was mit unkit S ~ t - e t B967 that Prater- -- I S ) rotas ?E@-P1y cstab SA fs mvned, t o t h e a t a t of 252 each, by t k t b r e @rig&= B p a t t f c i p a t i n g i n the agency which is ma- jm%ley af CmC, t " & t& other main e f t y szrzar Ear i 1 w l v d 13 &h 8s -21 IS24 3s st2Pia y , presently rcsgewsdb1e far %nltfal -rotSon o f ~thcfmd?aQenem~etet~~ nietmrk a d *or eomtmietlon of the Parge SP t Bm Zzydrwf a&r$e t plan% fwi eh aass.grtame sf 'E"&EB). XSA manage- mmC h s bee= effective k p hbc major saasstructbo operations. s @df%tgdling r The mak has BLitedlr imwalved in t%e ~ q a n y ' s tfBerml ~ r g a ~ % z a - rioaksld! dewc2apnil:, bat i e h s f f m n c d pax.1: of the cast of a contract tBatL an a e m n t l t m g to dewelep ~ p s ~ f a mmgment t e fnfomtioa syatw a bed 1wcneoq a d a c c m n t i q prmdures* Tbe U&%Hftp Tarfff m d & 2s an agency qufre dgfgereaat frm ISA fn that IZ& h as ne resy?l9392sbbilitilpB f a t ~ e n ~ t r u e t b erq ekerating ra plant, but it 5 s similar Lw rleg~~rese~acim 6 a new concept faa m Bm B ' B%a, which =as oroliight ts f r u i t i o n even anore c l e a r l y than ire t h e case of I S A largely because af the Bank's e f f o r t s . 4s empared with the interconnection con- cept, t%e Baas?& went f#r,theri n providing on request, i n Hay B968, a fafs- ",detailed ~ u t ' a i n e of Ehe p u b l i c u t f l b t y trarliff poBicf--.swhfch i t sug- gested shoulB be pursued. But f t s priracipal m3e, whicix lay i n pressing p a r t i e s for actfan, zabsfng the issue .lin pgPfcy negotia- the a p p r ~ p r i a t r arPo~s;a& s m B rfxg further Zeadhg partlallr dependeat an tessilutfion of t h e . %ssee, w as very sim9Har; equally it stuck t o a few 5asic principles, eon- sistenrcly propu~idled, w&thout SqT%ng, t o d i c t a t e t h e nbanner fn whbch these prfncL2les should be applfed. 2:aQIQy' whfcZ3 f%mIPye r g m i -Bn Decern3er B968 and came i n t o "%"he f u l l opratissp azfter the e1ec"ioas fn 1978 does mot BalBaw exactly rhe lines prb~psedBy the Bank, Iw ~ r t % c u l a rthe , Beard i s not an fndepend- ewt WquHatary &ewey W e up oE prminent scltPzerns, but m agency effec- t5wely %fn*egr~tu.d w6t%%w the HatPoml PBannfw W F r m e n t and cowsistfng of s a t o r aflic5ials oP that d e p r m a t . Mot-ver Iks t a a r e teskrf.c- ted Z a a m r m d m g rqanested karllff i ~ e r w s e s{as ~ppslt?rijlt o ewforcfng t a r - t riff imreases d f c h &t has i na%tLeiat&;,ewea t h q h f t can exercPse s - ifzfluence an tk requests p k fommd as a resrlt ob the PPanniw Depart- SbB&lPty f o r ErsaeQo 10ams a d for mt%oml budgetary al- & m e s m n e or f s r -f:~1k5- suibsUhs, agemy kl;(ish e n eataBP2sh8, Bit: b s , p p r m d 1 large &mteasesa d it h a imftiatd sksardfes to h p r w e ass: sys%=s, gatticalaarly 5.n tk casse. of t h rms water a ~ f l f t i e s . Partly t h r m g b t b e f f o r t s a% & h i?Bmkj khe G m El;t baa accepted tbe prin- ciple of a faliar raEe e f return ppas rmaZ'c~+A assets as a fact of 3ife for t h e mtiucl.cr~~fal rcaagio?rtrtiereof ]laublCc utirity cqaw%es, a d b t has set attain- writ of tlafs goat as an &$eehtw@ of elertb-Pc po1tcy. fk may mot be macehd quiskl?p m q tariffs R un re &n only l;p smZP Eraction of rbe a c e s s g . E e w e l , a d w r s i s t a t foll~v-up w t l 1 be reqsr.lited t o see t b t the ap3rovd t d k f r ' kwreasea a d p b w d plans of tar%bf tnctease are atuaflly a p p l i d , Negatiatims which eventaally I & to the &&-'a 1968 loan to the &got& Water k" my, the first f o r waker supply in Colmbia, began fa 1966. The Wgora City a&inistratfora of the day was concerned a b n t Ebe s t a t e sf tbe empamy, fi"g;li~kP had d e t a i i r s r a t d fn preceding years, and ft eakcwraged the c m p a v h smgwellar and t5e Bank s t a f f t o work out Eeasures t m a r d hprow-ent, Hence the Bad's f i r s t mission, i n May 1966, was aainPy concerned wttb f d e n t i f y i w tam grobllesl a r e a s and discussing speeiffc sertes of s t e p s which m l d be approprfate far dea'ling with them, Actual i m p l e a a m t & o n o f these s t e p s was stup@r.nnised r a t h e r intensively, with Bank zeZ?tssios w2sbtfng mgota e m r y three o r four a@rontldns, @ne problaa area was srgan%zaitfona d staffing. A Colmbiala cmi- soIta3a: firm was 'arowgbt i n t o adwlise on t h e orgamiizatfow91 s t s u r t ~ r e of t h e e n t e r p r i s e , Its f i r s t r e c a".&atio'xsswere bplemented e a r l y i n 3963 d e w t h e egarepprPse was r e o r inzo four matla departaents -- FLmw cdal, Plannfag, -ratio= and A&in%s?trat%r)n. Thfs replaced. a s t r u c t u r e B a wldlleh t h e r e bad been F i w n c i a l asdamager and stme twenty s e p a r a t e & a d s oE d e p r ts r e p r t i m g dfreea t o t h e Genera1 M m g e r . Slnce %9C7 t h e cmmv ha r t h r ewolved $=to a aa%r%!erabBy mare s o p h i s t b ~ a t e d m m n i z a t i o n , fmzludiw more levels of a c s p n s i b f l f t and mare steps i n pr-tim, east &ma thp fmeenitiwe p f a t of view, Total s t a f f grew dras same :,IW to a h t I,7W i n l.918, S a l a r f e s were bproved and s t a f f tammek cut. &pPwees plr9tL uniwers8ty degrees increased d f s p t o p r t i o n - aterzy, E T 44 ~ f n early 1 195 7 t o kSQ early La 1979. Work whfch used t o be e a t r a s e d m e fa i g s evskfreby t o coani%u8t-~nts Bas now done to some e x t e n t % a - h s e . In l m a - 91815 BraBn%ngp r o p = was s t a r t e d , Tn cooperation w%CL $EM, to p r &aJl e m r s e s for pHlknakrs, szarweyors, warer 'treatment plane opmat@r?r;, acc~~aktsing staff, ere, Szme 2W-3W employees were put t h r o q h these emrrsas fira 1970. Okhes h p r t a n t wobPm -reas were a;lcount%mg, b d g e t i n g and cmpu- t e t usqe, The &ak missboa fwd ser%eas deftrciesnlctes on the account- fng sSde -- capit&l&rart%m in parr%cuPar @ il-le~gle lack of cost aeicmntbng and un&e s f .re;raymscs, There was no wp-to-date assessarenf of t h e value o h assets, f ~ p r z r , r t E m establfsking carbffs and Beprectatfon aXlwames. There were also siertous b&lliag dehsys, Tt was agreed t h a t consiralltame assfseance was needed these zsltrtters, a d t h 5 cmpany 1093- tamsned the serodccs of ~tarioaa1wol firm. The acswntbng department and accwnt%mrp:syste?ra were rearganizel. A d e r n i i t e d badgletfmg s y s t m , h a & m 75 cast centers, was k n t r d u c e d &n 1969. BfPliing delays were grieat?~ reducatidl. B S l l t w was Earchef t q r o v d by a m j ~ e r f f o r t to star- wey and Wrme kbe distrihttrcra? Q ~ S ~ ~ E Zan I I F area ~~ t&~%lwd sa96fered from i m d q u a k e attmrim; am W r i c a n consulting d i m w a s broasglst b a t o assgst. % =jar grow= ?Eaf bn%alfataion oh m e t a s w a s andertaken, t h e o ~ r a t i p t BE ~ ~th~e W r s repair shop s t r e w t h e m d , a d system operation tightened. As z result system losses (water un3;cemng:ed for) were cut frm 33% of water prorhraced in 1966 to s m 24% in the second half of 1970. As mentiad earlier, the Bank also fc~ond it necessary to gLve considerable attentfoaa to cm7cc"imttoaawith tbe other agencies cmlderaed ~5th l the winter resources. ot the Bogota area, partieuParBy the Bogota P- r Cmpwg., This was to became prtbcaslatlg &sportant later on in plan~li~g5or t k sworad water supply project, financed by the Bank in 1911, siscc it has -jar ~ l f e a t L o for ~~ ~ Bogota power system as the velI as the water syshera. Institaatf-l ~plrobl- b w e not been totally overcome -- in parti- cular msaage3aeat fwf@-ttun flms net8 further s tren g:beaa%ng and eon4 sartltaat contracts rqo%re ff-s control -- but ft is evident that the -& has h d a m qo r '%8emficiaPimpact on &he ny w kalela wflP result ia srgni ficaac lkgty of water supply %in HEDgoka b n t s. T)le suecess s to result princ5pallp fim a ~382~b3mtfm of three factms: strong plHtica'P support in Bogota for r k w~:ov-nm m d e , the deta%lled nature ob the work done by the e && staff w % t b ? i"ate*t a s s e s e a t of pxprablms and p b s @ d solutPons, a& tbrhkl~gh sapmfsim 0%~ J C O ~ Ln ~ Sreach9i- S t h ~~bl~ltim~. fn EB-aer Iattm park of t k 1960s the B a d bas also B J I D V hnco ~ f%-n- eisg a t k r areas *ere i t bad not beem Iamlvd kforle [except for t twa - 11 i~prf~%~ltaxal ~r@dj%k loans a n the early 1950s) i a d Ed~cstfsa. En these fPelds mare lait& attapts bvie been mirile at -- Agrkczslture fn~tfk~t%~r&'ft ciicweImmt, a d with more 1bSited 3aceess. In both cases P& app~ureh bas beem bsfea831y ear o af setti* up a rpec%al project offfre u%tbfna larger e aaeiky am3 fo:as~~%ng effme thfs office, The most val- uable anstitaatgoml cantrbbeim $an a @c u'dtwarig appears an have been b n th e"%edam-%gze P-em igfi~~ftaraB CEdgt ~ l t ~ j on t ~which disb~rsment af f u d s bas so Ear k e n so - 11; the gore%@ e oassrulkiawts (SCET) provided g& ttriwing, a& k a m a r s arar asse msh. of t k eadusres 5 ro i t lr the course f a S rks othr ogrfcaltaral credit projects S I m BbP t g 1UitB ma11 far- mers). m the Mlaaetico frarigaefm a& Land f-42-tim preject the con- sultants 1:TahaI) are ptmfdis s m c useful e stBplerimc e to X l ilaU prsonncB fn prtajecr =mg-nt, Res~sfbPlPty%or the cdacatfm project was assigaed t o ICCE (Institute C o l d i a m de C~nstrucciones Escolares), a decentralized agency under t h e Ministry of Edreation, principally res- ponsible f o r construction of schools. This Bas tended t o i s o l a t e the project from the rest of t h e Hinistry, make r e l a t i o n s with other d u - cational institutLoas lore d & f f i c u l t a d lirait t h e p r o j e c t ' s spread e f - f e c t , i n terns of i n f l w n c e on other educational institutbons. Oat the other h a a d , i t h a s p m b b l y enabled t h e p m j c c t to go f a s tsr than would otherwise have been the case. It is clear frar this brief rehew that tbe Ikrak has m d e etraae isportant a d useful contributfoms to deve t of & a s t i t u t i o n s f o r c c ~ dcveloplrent c i n Col0mbS.a -- auinP specialized technical agencies a d e n t i t i e s . 'I"bs actual wintrf hawe been of several d i f f ereat types: %ashconcept (as i n the euc of f SA) , policy frame- YO* (as f a the c u e of U t i l i a d the m r i o n a l Hlgbav Fund) a nd ;fctaild i n t e r n a l o {as i n t h e case of the Y i n g s t ~ ~ of Public Skwks a nd Bowta W a ) Pa r b r t a l l e n t i t i e s with which the I k d has beta a s s c fiarslcf.1 side, iacludfag ac- er than what it 11 as t h e other tMt TBBP) coatsi- butimu t o f ~ o t f t a t i o l ~ . dE t b.m ~~ he 1960s is s t r l k - 2%. To scae degrcd a i r tedly d m to tloc f a c t that the po_lit- Whsre i n i t i a l l y tk Bank wu prgoceaapied tritb basic c o a s t i t u t i o a r , f o ~ strrrettvc f a t the tap level osd f f range of rfsim to s Utap mime 0 i n s t i t u t i o n actually wzks: budgeting, planning, overall organizational s t r u c t u r e a d levels of responsibility, l i u b b e m e n organizational units, s t a f f i n g , s a l a r i e s a d salary structure, training, internal pro- cedures (e.g. contracting and payments), cost accounting atd wnagglpeat infornation f l o w and budget control. This i s perhaps best f l l u s t r a t e d by t h e contrast betueen the Bank's tzeatrugnt of the puwer u t i l i t i e s with rrhich it was i n i t i a l l y carcemed i n the 1950s and its involvement with the Bogota Water Company over the last f i v e yeus, o r between t b e approach t o tbe Winistry of Public W or k s i n the 1950s and that i n the 1960s. The focus on Bornd c a p o s i t i o n and g r a d principles of o r g r a i u t i o n ,has been replaced vith a knrblcr and m r e coastructive +rpb.sis oa certaia func- ti- and bow they can best be f u l f i l l e d d e z prevailing c i r c m t a n c e s ; cxpcrieacc hr rhornr c e r t a i n functions t o be p a r t i c u l a s l p c r u c i a l pecially plamriag, p e r m 1 p0li:ies a d at i n f o ~ t i o a -- es- syst-. Tbc contrast between the period. is p r r t i c u l r a l y i l l u s t r a t e d i n the case of trrfning, FI&rich was always irplemeated by eonstrltants red +hc u n t i l t k c mere recent -- for iniltaace w u l t a n t firms bu alto adapted r ror f oooer;Sng Ilans, .ran u krt also la tlm u n i t i n tEtc h t e St is sI;riking BOP l i t t l e imtit~tti0s51spread affeet tkrc bas beem to date from thc tkdr's i a r t i t r r t i o a - b a i l d i w i n i t i a t i v e s . qe rge- bt evideace of t h i s W b witlain agencies, in t o ot-I, ad k itr, a n tk e that, e bar bass adepwat for teachfrag i a m these s e b l s a c t a l l y seayed w9th their 018 schools. mmwers in Lkc Blaasprmtfoin S@CEOr do not seem to hawe attracted a dispr~porti3watewmibear of highly q ~ l i f i d -- staff rather to the can- masy. The need to mimt imt%tutim-bui1dd,qefforr!: by el--- , at& well- fwd& eco amlysir ts sae of the clearest " - ~ s - m st h h eratr-$err frm e b b r . T b t cmerisot karrtea t Z&a d 3 t k case 0 9 CB4#t t c Ba is respect scads @at serop3gPy- 2 1 5a tzd b v e a @ institution mtepaae rgtpld%rP s ralLroads than g 9 q t h f s imtiteaboa, Wirth regard S tbrefr ca~aasuPcaats, t o Iden- ti@ ow q~irwrhtedw~r-d-1 Er tk a d as hse a - %astit9atL@n*.B e-r ear: -8nal'iy -91 % Its (164 -peer V$ %a te&m mt saly 0919tk3Zd t h Md-fi amre satisfac- e~exy k t s~~~tsmrrt i=%y O$) M f - tbt e m z ~ ( C L V -C B ~ mcfaxl1$" ~ f~ E&e ~ i a c i - l c@ab.hfkikimhlf k h  an# We13Sn r craapaniesr, the cmsiderable P b Q d to be the beet run a d 'best staffed u t i l - +ua a& w e11 staffed -- before they s, P.ZJ. she -= and wieh ~ d n a g t and gieldbng perfomace data w r e slgnf fieant than the pasrely fiaaamtial. 3. The Bank s b l d gfve =re attentam to adequacy of salaries, salary strcpctures, Fnccvartives for crafnfng a d payment 015 apee%alpremia. Poor salary structures a d Instabb%tty of salaries h real temis seem to ae at the heart efmsmy grdl- in mlmbPaa &.verzment agencies, also e a w f q excassiwe rell5anee m cowsultants. 4. Far prejects 6n selectim s f &icb PmtPmtion-bui'1ding aspects arc f w r t a n z , agpaisa1 reports s b l d cskalain a clear deP5neation of the pa@blmrrsa & a p f e i w l y agreed and p b s e d program for s.rrercoming the msh ant of ae9e ~i%fbeola%as, w%tb perL.adis (quarterly or half- ymr1 gets ag~fnoa: fialafch prfo-mc m y be ehe'dcd, T h e hnk shottld try k m-c ezs%rting r s e t W s to assess &hie sf8fcfency levels sb insti- ta%fms a d to &s%g?.a ~,bje;kiwe %&fartorsoh bnot&tael~~aP ~mprovment.  X - PB]cau]cauCIPd3. OPEUP1 IWLICATIONS 1 probless o f Colombia are rural poverty, memploy- t and d e r w f o y - r , and these problems, which reflect an d r r u t i l - tion of the c s u n t q ' s natural d physical resources, have not dimin- ished over the lase twenty years a d .may hawe got worse. The Bank has contributed r ~rastsuctural bottle- rthg a g r a t e r public pire major advances made, qmte p l i c & @ shave 9 h - foed tbe &antage t b t @01diabas drawn f r m resources and ~pportunI- ties avaiP&fe in the country and restr&ct& the b a e f ft der&vd f rcm extensal re9o'Ioaceib provud. rfghtly stressed the gz%B rate -PPua By not iw as eff icienc ;m way able to astau. e k fLve key issues iw b s tended to put rather mm q b s i s an fwo la the of the 1 96 83-- 6 the bal- d f9mseal constrahts. egard to iaprovenients 3.n ff-E plb:%es ft has pr&&By achieord as much as i t t o h o e dam. we %t b ass g i o a muck l e s s attientgon to tk h $p of m b f l i ~ i ~ t & 08 prabl~lti; mdestk as E i m e h l- d p r t l e % p t i m h a ate dwe &A's effetts b\pe W, as a by-ptdaaer t on these prob- 1- & =vetel om88al %rza%tUtlwa &awe mefther the Icdiag 1 m,kas ~~lbl$l.P -s -- si: - 1 d H ; a credit to the private s e t o r tkrputh $rat edwfee b w e so far d a a great caatrih As regards the ffftitri $ssw h -11diw dmello piillb1I~-tor Wtftmtfms -- t k a - the ~ j e a W s 8of & has mde stme asful contributions awer tbe years, but m h l y wiah Wtktet5ms; m t d~rectlyi m o 9 v d 155th these two key dsaes. gprr&lms reqaire a =me p r m h a t place 3.n &b famlatiPcan .a3% d 1 aspets asf the W k % aassg-fftawe strate= -- policy &wf@s, I d h g d bot%tutim-h91d%ag ~ffomts+ years the M b iaas dmela@ a cwb-tion of c eutlw'or; e b b cda"lra9thn ~ m l dmake br a or %BE?Ip* t k a f d f a n a~thoriths%a .PPkir efforts sc s e w e a better pt'tern d w e of dewel o than bas been oaur& &n the pas%. Ikz B ank has applid, asgemufty a d d3.p ;a s y s t a £or negot5atgoag rewZar *~ietenag s m major develo gram end of its r m&atforss to %he &muXzatiwe & r a p rs; shSs system sbcmM clearly be mbtahd, possPb1y in a less fo-8 way tea$. Cmer-nt stat~;fpts  s for list- of stock. Iego r later loans might deal tber steps ia capiral sarket as needed, or with o t k policy s a t t e r s affect- Mustr t such as qhport tarifds a d prsUbitiorrs or corporate taxaslon structure. As regards h i g h y s , adoptim of a sectoral approach would k v e a n a b r of adv81-i- cages - focussing greater attentLon on the question of how much resauces i n t o t a l & d d be der92aed to she sector a d how p;.rtbcular roads a d s be a13.watd difEerent eLassificationa, isn terass s ds, given the badget const f l e x i b f l i t g fot adgu the 0 E th 'various P htrdwed wf th a e a d present1 sfble for feeder , w'h2ch b e Isgged and are porzy coordinated w2lth tfze ocher h i a g h t wlkf tly =Is for meh m e wager garppIy proj r Caja &raria its, "Ea-ers and 6, M%* ce h Cal-a, which &PC r@SFbh S k 4)tk~CXHmtf %eS, t k -sly comMer ate$&% the fie19 of h s m , prhc5-1 inseftueioprd f~~~itrkbut5eas 2s esuU mb, TbPs fs nor an easy f f e i d and 333 W a -out=& dHficdt%m ita k t , but 91: appears uaraSiz& p o a t f ; ; n %& Ui l a b h . aah~asg'ta house con- 2ctstalarEy fwtesiwrtz! in, use of h h r d rasher hdegendent a p p l y iaa -1df-a fs P w l d t l g cerious~y BeUntl ef f ec- re ~ r i . m s f y% h i d needs, partly due to def%eie?nt P af~atig-ats for d l l i a b g -wPngs a d c s r ~ n i e h g construe- oZm a & sremturd brefisf-ks BT1 the u r W Laad aarht. The f irsr seep Ed ke o thorolrgb st-d;st co assess ef the batsing Padus- rh tlte rest of t ct5viefes, rgfZd the . s i a k % ewmld r sect~rs, H this study sbfrs t b t bas- flmplopne, 1s a sector a d semZce plans rPnslert&a by p&L%c uutflieles or wnlcipal authorities. f* Xwtimtion-hiMka As rci;ards future projecit (as opposed t o sec- P the pr- t o r ) leading fn * l d f 9 , criterisPn 5.n selecting projects for  r e , shsrPld be the extent of k s e i t u t i s n a l deve c m l d be expected t o r e s u l t , siBee Cslcmbian deve imry Is use of resources are severeXg cor85traZned tz~ral weakness. This agprcaeh bas t h e s been p a r t i a l l y appliedin the past, but we are pro- posing s stronger a d fuller app tdon of i t , even a t t h e r i s k of slow- b g d m the l e d h g pace ( w h k be e~k~peasarsd t o so= extent by use of s e c t o r l e d h g , as proposed). Projects s b 1 d be s&ected i n l i g h t of she averall W t i t p s e f o m l strengths og the comtxy for d i n g the nost of remrees avaibblrt t o i t and o r 9 a t d t o strqthienLag weak points, a s f o r i - w c e h a b u s b g , P a b ~ r - h t e a s ~ rh ei g k a l s e crops, r u r a l education, 1 t m water sapply and pub?-ir h e l t h at present. This w i l l require &racer hft%ae cs preparatbsn, more gntensive super- vision 4 , in apabblitiea. If prod- e c s are selerrt 's contribution t o the e2gn exchange cmp- neat or a t b r q d f t u r e s are t r d if&ed a s investment o r cmsfderd 2.n a mxh terms of object-ives (prmM& thib p1ds.y agr Bank together with m k r s awre t h e financhg of local nae &we a mgiltiwe effeer on dozaestk. resource f f e d t pr5erftp to betftutP4)jnaI coaslderations I$B P~L of rTsk IC rge~~gZtPffg~~1 a ~ts ~ -frta Bey greater emphasis a d progress. Since .?Lone f f e c t is rare, with an l.mrim"rl~biBd-folg 5- f&)@f:s,53%aec for a c b i g ~ h gposbtive spred effeel. 5. s Bb m B d be select& ~ A t h a v3.- tr t (~brparghi h s 21ogtributi~flt o merr-Sng tk eracia1 za%ot) so amre attentfen should be given t k m L ri c b past te esa-5~4 t b t t b 8 - pzeJe%rs then w e 1 have as great a devdo-nt -act as &bey e m h v e , %Ps a p p l k s particailatly ta M r e s ~ r ~ e t u rpradwfs ft and it requ9srw i w k h g a-t Iop~ia tand a u t L I S z & or: d e n n t i l b d as irn t h e area .rts ected by the project a d . at tke i n s t i s u t i c b f m s &car the projectqs pte3t%& it~.nt~ihtio Ean 4Qa4 of 5es.e reswzces. fn pwer f o r &stance, a t t e n t i o n s b a 1 d be gSvera I s r~rUSBity@QZcks regardrigg new con- t rnections & s y s t a exre-im, possitgole c o n s t r a h t s t o reaPiza;kion of dweler-~~t beaefits h p s e i d Sy r i g i d i t y in tBtrt tgriflE stracture or by Sefieie~cies in -2eipf p1-h: a&puas&bleneed h r e%f-*lp efforts of the &cia,n C port i n f r a s t ~ ~ c t w e 8EtetC1011 s b 1 d be gBve~1 68 rke devels ti& rf t-he area traversed and the & - m y t ~ fplans, publZc agencies. and other infrastavcture 3-a the area for ebtahinl;; t h e w s t positive h p a c t ptassible frm the higway o r raaway; this m y wean attention to feeder road plans, a g r i c u l t u r a l extension and =kt* serv3cesY regional dewel- o p n t plans, cmservat&ora practbces, cmapet5a2veness of bus and freilght services - or evg% t o adequacy of iciysal w a t e r supply services, wh3ch out to h e been a sip&ficant obstacle t o realization of regional t b-fqts in so winy cases stud&&. 9. Plbojaea: =gperer-isiiion h =sit f i e l d s needs sf;^ &or;lmr;rtia flows a project perf~maztceand more -8ysbs of tUs hfs-it2m. AttentSon b as tended kio be conrentrated on loan d f s h r s - n t s as a m M a e a t o r cf project per &n t h e absence of =re? r d e v a t data, o r else on a few general d Zndiraticsrs which set*§ b M e probl- rat- than rare& t%peertn. It s b d d be posssLble s o d-2- a t t h e the of project appro-1 a system of hfoimarion flows a h t a d e w key varlablesI a l l y of a tsrcMe;al nature, l o r concerned )ipjhth reg&-l m a a @t ,wbkb w i l l s he w w k t k r the satin b e n e f i t s experred of fbe prajeea: are 8niaterbalbhg m a mW10le o r m o t ; h some a s cSat8ly &ere t b e r e are difffeaalt p r o b B m 5n &nstftutfoaial perfo m y be apprapruate oat the of Barn negstB9rum as agree on rageas f o r t be iisce ~ a r h b k *fie s Ln o t k r c the ccmparfson may be raeber with f o r e m s r s d e . The neexi f o r ar%tristype of M 0 -t- my bve t o be t a m h e @ acseomt -re mp3.icPtBy t e- =at %Ea%omtim systaw for brrmertc f o r whk4 the of p a f o m e c e data are ed ilay 3oqas t o i d l l s r s t - r f p l l a d e =ses the purpose sblilld be t semd.to fSs Loan f d s a r e g r d u c - b g ;aslidl partly ca prmfde c a dam *%eh ~lcadddeep= asabderstsrdw of the f%cet;aksat mrk affect- the - tor so that: -3ts subprajeccs wlrjelt be re rtarsat t o tk extent that the d e s mare use rrsB h e %germ2 ZieIds a d cE sector leading s k.ecMq~&es. Wtter B sfst- 06 t k e type d e s r i b d a r e also g wptre~k. 4 WXk. O HB t m b j % ~for ~ r k g~ &P&fa d ~ h k t s~ be e w f d h o d .BJ.i$h it, efully 10. Kva1mlt&oa of &71~1~~3la~paes. The Bmk shm3.d m -ke a more systematic effmit at ew&~~;$tfa~l af ier~ng5utltmtd pexdlio e, mpecfallgt h a cases &re the -has rec-dcIca o r requ%rdtbe %%irBag cg ieonsultants, or wWre -te-tbsaal %%m are bvoltv&, B t s h l d be a standard require- ~~t t'lnat staS1E sre@omBBle far S I U ~ X V I S B a~ projecf ~ discuss ~ m s u l t a n t s ' w&tb ebe hrrozser a d r~iIrkrs,and wrfte a b r l ~ fle%ralaaatlcm, at leasr a c e a year, of tbe perfes e of &be copasulta~~ts as a firm a d as Miwid1Ealls- These wa1mti Id give the W d an up-twdate view o f for use 5 a d1g5sBflg hrr.~fie-rs about seleetZion of cr~asultanks f jobs and 9aa hirhg eonsultanits i t s e l f . , be e ~ r e b s i w e briezllqr rovering a19 the p r f n c i p l s e x p t e d t o ~ E r r s m , -1diag training. A procedure of t h e s o r t d e s c r i b e d could h e l p t o s e c u r e b e t t e r c o n s u l t a n t performance f o r borrowers i n g e n e r a l and a l s o h e l p t o i n t r o d u c e new con- s u l t a n t s , i n i t i a l l y encountered i n t h e i r own country, t o work i n o t h e r countries.  h W l b t a s of G m t h l / IWsu IYO 111 1362 I963 l96h 196s I* 1970 lH9-(1 1W.M IW9-x ml u 1962 TCN-VIM O(NE~UL PMN w mo SOCIAL o r v C o M n L C ~ I C 81 Instudad I n other v l s l b l e . - - - - -- --- - -- -- -- W u l a t ion mlns 14.5 14.9 19.7 2.8 &/ Not a11 o f Chow projoctlons t a r e mod. a l p l l c l t I n tha Oanh Mlsslon rapart and r w of c)uo hsd C r r t l c l p a t l o n Rate fconanlcallv A c t l m Population mlna X 3 4.7 2 . 4 - -- -- . -- -- 9.0 6.7 -- 3.3 10 Ln p l w d t g t k r from v a r l w r rmarks, i n --- - -- -- - -- 4qrleul cure mlns 2.2 2.7 1.9 p a r t i c u l a r thOl. r e l a t i n 9 t o I n w a t n m t . A t mas pulnts t k Mission I a p l l e s a c c e p t m a of tha Won-agrlcultun mlns 2.5 -- --- -- -- 4.0 4.4 PIan'r I n n r t m n t estlnuter, but a t other polnts - - - -- -- Productivirv per h r s o n .I I958 P 4623.0 6003.0 2.4 Aprlculture Non-aqricultura l9$8Ps.3125.0 l~Ps.5975.0 -- -- -- -- -- -- --- '4195.0 7195.0 -- 2.7 1.7 I t Implies that i t conrfP.rr them ta) law. S l w i t e r p l i c i t l y W r o w r the savings t a r y t s as COPAqricultura Non-aqrlcultun total blnl91Ps. blnlHCs. I n I 5. 14.9 9 7.0 23.0 3 - - 28.9 -- - 11.2 29.0 40.2 5.7 5.7 4.4 6.2 5.7 reawneble and also recar*mdr Increased c.plta1 inflew i t has b w n aslumd b r a C u t the p r o j u - t l o n r assund v a l l d t a r e t h o w l n p l y l n q l h l w r I n w s t m n t Rate X 18.7 -- 23.8 -- -- 25.9 -- 25.3 I n ~ s t n n rate. h a t only. t Gross I n w s * n n t Cubllc TI-d I n I b l n IW s Ps. I 0.8 -- 8 1.6 1.8 2.0 7.5 Za2 -- -- 10.2 3.2 I2.t 12.4 5.3 6.1 8.6 13.4 $1 Includlnq $40 m l l l l o n 0.8. for tk Crlvacs Prlvaca Clnad Inmmrlea b l n I- I n I Pa. P 2.7 0 - 3.4 0.8 - 3.7 4.1 k.5 0.8 - - 5.9 10.8 4.7 7.4 I n w s t n m t Fund. -- -- 1.1 g/ Publlc Savlnqs I n I Pa. I . -- 1.2 1.b -- - 3.1 7.8 11.7 9.9 Sourus a m Cwntas Neetonales of Omco da l a L p u b l l c a , m d tebles 9 I m e 1 m h . n I n t h l s n p r t . Crlvate Savlngs Foralpn Savlnqs b l n I))(Ps. b l n 1958 Ps. 3.4 -0.4 - 4.0 0.6 - - 5.1 0.8 - - 7.0 0.1 8.5 5.4 6.8 11 Calculatad a r b l t r a r l l y bv applying savlnqa rates calculated on c k . basls o f r u t l o n r l wsounts 0.of ?.Current Acct.O.f l c l t mln S w r i e s I n current prices t o G O? alpnssad In Imports of qoods L n.f.s. mln S SOnStMt 1 - hlos. Net Factor Ceynmts mln S pl For tk. b a l a m of p.ymmnts a c c ~ n t smd w f f n Enports of n.f.s. mln S ennual ratas of growth a n shewn not for c k E r w r t r of gads mln S p r l o d s Indicated but for 1960-65, 1%5-70. and of wh. h t r o l e u n mln S !SO-70. Bananas t~ln S Cotton mln 5 i/ For period 1959-69; f l r r t c o l u n o f growth Livestock c ? d u e t s mln S r a t e r i s for 1959-64. chemicals mln S L/ f o r period 1960-69; f i r s t c o l u m of growth Tobacco mln S races I s for 1960-65. Ockr vlstbla mln S Contr.tmd rln S Coffn mln S Crlcellb. lm c Volun mln b@ qs - --- U n r e q u i t d Transtars (not) mln S 17 17 ;8 18 Foreign Otrecc I n w s t m t mln S 35 35 18 I5 O f f l c i e l Long-tern L o w s (gross) mln $ log loo 134 I11 Anortizatlon Dalmclng Itam mln S mln S - -10 -38 -6 -40 COP: Total b l n 1958 Cs. 21.9 l n w s t m n t Rate % 18.7 Cross I n m s t n n t bln 199 Cs. 4.1 Public Finmd bln 1958 P5. 0.8 o r l v a t e FI-d bln 1- Cs. 2.7 Inwntorlas bln 1958 Ps. 0.5 Public Savings b l n 1958 Ps. 1.1 P r i v a t e Sarlnqs b l n 1958 Cs. 3.4 Foreign Savings .I b l n 1958 P -0.4 0.of C. Current A c c t . k f l c 1 t imports o f goods C n.f.5. Net Factor Cayrrnts mln 5 mln 5 mln 5 48 -- Enports o f n.f.s. mln 5 mln f - C~ports o f goods of wh. Petroleum mananas mln5 mln 5 5W -- Cotton Livestock b CrDduCts mln S mln S -- Chemicals Tobacco mln 3 nln 5 -- Oxher r i s i b l e Con t raband mln S mln f - - Coffm mln 5 US c - - Crlca/la. Volme mln begs - Unrequited Transfers (net) Forcity Direct i n r c s t n n t mln mln S 5 -- O f f i c i a l Long-term Loans Amortization mln mln 5 5 -- Balancing Itom mln 5 - ACTUAL DCWfLOMUT Population mlns 15.8 P a r t i c i p a t i o n Rate % 29.8 Econanicsllv Active Population m l r r 4.7 Agriculture mlnr 2.2 Won-agricul Cure mlns 2.5 P r o d u c t i v i t y ~r P e r m 19% P I 46W.O . Aqrlcul ture 1958 Ps. 3343.0 Won-agriculture 1958 Ps. 5697.0 COP: Agriculture b i n 1958 Ps. 7.5 Non-agriculture b f n 1958 Ps. 14.7 Total b l n 1958 Ps. 22.2 Investmrnt Rate 2 18.4 Gro,s lnvertmrnt bln 1958 .I P 4.1 public Fixed bln 1958 Ps. 0.6 Private F l u d bln 1958 Cs. 3.0 Inventories bln I958 Ps. 0.5 Pub1 i c Savings f' b l n 1958 P5. 1.1 Private n g % / a s i v! b l n 1958 Cr. 3.4 Foreign Sarings b l n 1958 P5. -0.4 *.of P. Current Acct.Dcfici1 mln S -61 imports o f goods & n.f.5. mln S 512 met Factor Payrents mln S 36 Exports of n.f.5. mln 5 81 Ezports of goods mln S 528 - --- of w h . Petroleum mln5 Bsnaflss mln 5 Cot ton mln 5 Livestock b Products Chemicals Tobacco mln 5 mln 5 min 5 -- - --- Other v i s i b l e mln 5 Con t raband mln 5 Coffee nln 5 S c Price/lb. V o l ~ U mln bags - unrequited Transfers (nut) mln 5 2 Foreign Direct lnvestmnt mln 5 1 O f f i c i a l tong-term LOMS (gross) mln S 74 Anortilation mln5 -111 l a l w c i n q Item mln 5 -27  ( l a mlllion We., on l n u u r y maah-flow k a i a for 1963 an4 lo11wlly yaara; r a t i u t a d a p p r o x i u t e caah f l a r for 8 a r l i a r year#) 1. !MmLkdfor- I. I n c a Taxes 2. Inheritance Tax 3. Custme Dutiwe 4. Import Surchar8e (3?) 5. Exchm8e Oiffarentlal 6. s a l e s ra-s 7. st- Tan. 8, FNal Tam# 9. Other la-a 10. h - T u Rownwa 11. Current Account Larn?litun. 1. hr8onal Sewices n.a. n.8. 2. Gen8ral Erp.nd1tur.a 83 119 3. Tranrfera n.8. n.a. 4. I n t a m a t on Public D.bt n.a. n.a. a. Caterrul a... n.. b. Intarnal n.8. n.a. 111. 1V. V. Overall Surplus/D.ficlt ( - 1 I. Internal Cradlt Individuals - 2. Internal Credit Central Bank - 3. External Credlt U .S. AID Counterpart Other Fund. Laas ADDrtlLation &Luu iLp ! COP a t current m.p. T a n s on lncom 6 Uealth ( 1 + 2) T u c s on Foreign Trade ( 3 . 4. 5) Total Current Account l n c o r Current Account Eqwnditurea Current Account Surplua lnvestlmt External Credlt (net) In C o n s t ~ t1966 h t c a a Tanel on Incow L m l t h T a r s on Forel* Trade Total Current kc-t Imor Currwnt ~ c c o m tElacoditures @ u a l -81 G r a t b k t e s 7. Tams on l n c o r 6 Uerlth T u r s on Foraign I r a & Total Current Account I n c a r Current Account Expenditures NI R RLC I r of Incos~Tax Payers (thnusd.) Y ~ t u r a lPersons L e y 1 Persons * l n h c r i t m c e tu not available. g/ Converted usin8 CW' < . f l a t o r . w: O e p a r t r m c o Iaacional & P l . c # u i o n , Plan & R a a r r o l l o Econaico y Oocial 1970-73 MME. b l e t l n vbmwl & Estadiattcs. .?.ceder 1970. n r l t o n C. Tar'.., Fiscal S u m y of Cola'i-. ?So5, published under OASllDI Joint Tax P r o 8 r ~ . IMD Econontc &ports. AWon E s p i ~ o s r% r a l d e r r u , -r.a & N~~iend a 1966-70 International PI-netary F81nd for 1968-70  mb l aLLu DISTRIDUTION OF MTlOWIL WMRNWENT LXKNOITWS (Accrual basis; mllllons of IgW Paws) 1951 I952 1953 1954 1955 19% I957 1958 1959 1960 1961 I962 1963 1964 1965 1966 1967 1968 1969 1970 Expenditures on t'concnlc Dewlopnmt Agricul turo nlnPs. 123.6 126.5 166.6 107.0 105.3 82.8 68.6 228.5 80.2 129.0 372.2 253.8 172.4 272.5 566.4 556.2 584.4 800.1 804.3 985.6 %oftotal 10.9 12.2 12.1 7.1 3.1 4.5 5.2 14.7 5.8 e 3 11.5 10.5 7.7 13.6 28.6 24.1 21.8 21.3 18.0 25.1 MlnlngC Ewrgy Mln Ps. 117.1 173.7 170.7 189.3 1446.0 182.8 IOa.0 142.7 164.5 261.4 252.3 347.4 518.7 246.1 110.8 167.4 189.5 310.4 982.8 494.7 WofTocal 10.4 16.7 12.4 12.5 42.7 9.9 8.1 9.2 11.9 16.8 7.8 1*.4 23.3 12.3 5.6 7.2 7.1 8.3 22.0 12.6 Industry Aln Ps. 2.8 25.6 13.7 3.8 2.9 4.5 2.1 59.3 8.2 11.3 33.6 43.3 38.3 83.9 16.4 36.3 114.0 320.5 230.6 g/ XofTotal 0.2 2.5 1.0 0.3 0.1 0.2 0.2 3.8 0.6 0.7 1.0 1.8 1.7 4.2 0.8 1.6 4.3 8.5 5.2 Buildings MlnPs. 63.2 54.1 87.2 95.6 144.3 196.4 102.7 68.3 61.9 98.8 147.8 166.9 176.5 35.6 79.6 135.6 106.9 264.2 116.8 85.2 %ofTotal 5.6 5.2 6.4 6.3 4.3 10.6 7.7 4.4 4.5 6.4 4.6 6.9 7.9 1.8 4.0 5.9 4.0 6.9 2.6 2.2 Transport nln Ps. 648.7 449.2 669.0 813.4 1226.0 1102.6 898.3 658.6 937.7 778.9 I W . 6 1144.7 925.1 1039.4 1041.0 1204.0 1353.4 1510.0 1736.7 1894.0 %ofTotal 57.4 43.3 40.7 53.7 36.2 59.6 67.7 42.2 67.8 50.1 444.8 47.5 41.5 51.9 52.5 52.1 50.5 40.2 38.9 48.2 Sarvlces HlnPs. 160.3 194.3 207.6 103.5 130.5 188.1 59.4 110.1 95.9 171.7 531.0 307.6 107.2 139.6 13L.6 171.0 250.4 352.3 470.0 330.4 Xofiotal 14.2 18.7 15.1 6.8 3.8 10.2 4.5 7.1 6.9 11.0 16.5 12.8 4.8 7.0 6.8 7.4 9.3 9.4 10.5 8.4 Other I: nlnPs. 14.4 14.3 57.8 202.7 333.8 98.9 88.5 291.6 33.9 104.4 442.3 145.0 290.2 184.0 35.2 41.3 81.2 203.0 120.3 136.1 XofTotaI 1.3 1.4 4.2 13.4 9.8 5.0 6.7 18.7 2.5 6.7 13.7 6.0 13.0 9.2 1.8 1.8 3.0 5.4 2.7 3.5 Total Plln Ps. 1130.1 1037.3 1372.5 1515.2 3391.0 1849.0 1327.4 1559.2 1382.3 1555.6 3223.9 2408.7 2228.4 2001.4 1983.8 2311.8 2679.7 3760.6 4461.5 3926.1 % o f Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.6 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 AI I Exmndl Cures Economic Oewlop*nt Hln Ps. 1130.1 1037.3 1372.5 1515.2 3391.0 1849.0 1327.4 1559.2 1382.3 1555.6 3223.9 2408.7 2228.4 2001.4 1983.8 2311.8 2679.7 3760.6 4461.5 3926.1 %ofTotal 33.9 29.8 32.5 33.5 36.9 36.0 29.3 32.8 28.2 27.6 40.6 33.4 30.8 28.5 25.1 25.4 30.2 34.2 33.1 31.9 Social Oevelopnrnt nln Ps. 417.8 472.7 534.1 641.0 728.3 737.9 595.9 747.7 788.5 907.6 1134.9 1406.7 1471.5 1727.5 1702.9 1869.5 1987.9 2506.1 3125.9 2959.2 XofTotal 12.5 13.6 12.7 14.2 7.9 14.4 14.0 15.7 16.1 16.1 14.3 19.5 20.4 24.6 21.6 20.5 22.4 22.8 23.2 2k.O Education hln Ps. 150.8 181.2 209.4 27!.3 300.2 309.2 237.2 362.0 383.8 454.0 602.0 805.2 815.4 1034.4 1009.0 1071.8 1126.9 1357.6 1666.5 1580.5 ZofTotal 4.5 5.2 5.0 6.0 3.3 6.0 5.6 7.6 7.8 8.0 7.6 11.2 11.3 14.7 12.8 11.8 12.7 12.3 12.4 12.8 General Expenditures Mln Pa. 1352.5 1497.7 1831.1 2027.0 2192.8 2160.9 1917.4 1894.1 2240.6 2691.1 2938.6 2813.2 2832.1 2398.5 2422.5 2607.8 2665.0 3297.9 4416.1 3856.1 4:ofTotal 40.6 43.0 43.4 44.9 23.8 42.1 45.0 39.9 45.8 47.7 37.0 39.0 39.2 34.2 30.7 28.6 30.1 29.9 32.7 31.3 Defense nln P9. 527.0 706.2 967.3 1116.3 1103.8 1084.1 870.7 819.9 792.2 879.3 912.2 929.7 867.2 804.5 859.2 848.8 883.2 1118.4 1007.8 1064.2 IofTotal 15.8 20.3 22.9 24.7 12.0 21.1 20.4 17.2 15.2 15.6 11.4 12.9 12.0 11.5 10.9 9.3 10.0 10.2 7.5 8.6 Polico/Justice nln Ps. 249.7 331.8 312.9 388.6 427.4 450.1 M7.5 367.5 485.2 648.3 1019.8 959.1 1007.3 684.3 954.5 1103.5 1137.4 1264.7 1382.3 1318.0 ZofTotal 7.5 9.5 7.4 8.6 4.6 8.8 9.6 7.7 9.9 11.5 12.8 13.3 14.0 12.6 12.1 12.1 12.8 11.5 10.3 10.7 Total Hln Ps. 3328.3 3480.3 4216.1 4516.9 9197.0 5128.7 4258.2 4752.1 4895.1 5644.3 7934.1 7212.2 7224.2 7011.9 7898.7 9109.2 8864.0 11011.3 13491.0 12317.0 Y of Total 100.0 100.0 100.0 100.0 100.0 1W.0 100.0 100.0 10J.O 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Source - Contraloria General d-. l a Republic8 - Inforwa Financierom Direction Cenerml del PrerupuesLo - Ley de Pre~upuerto 51 Included in ''hvelopment of Mining C Energy." b/ includes Special Economic Services.  COLOmIA: BALANCE OF PAYMENTS 1950-70 ANNEX TABLE 1.5 (USS MI l 1ions) mrchandise C x w r t s (f.0.b.) Coffee ( ~ d j u s t e g ' ) Crude Petroleum Gold ( W o n - m t a r y ) i ~ ~ ~ & ~Jr ae& 'd Subtotal Exports o f Services Transportation Travel Other S~btotel Total Exports mrchandise I m r t s (c.i.f.1 Subtotal Imports c f Services Travel Government Other Subtotal Total Imports Wet Factor Payments Incme On D i r e c t lnvestnent l n t e r e s t Paymnts on Public Oebt I n t e r e s t Payments or, Other Debt Subtotal Current Account Balance Wet Transfers (Donations) Foreign D i r e c t Investrent Inflow Outflow Subtotal O f f n c i a l l v Guaranteed ~oans:' Disburserents - IBRD . - Other Repayrents - IBRD - Other Subtotal Other Loans. etc. Disbursemnts Repayments Subtotal Other Monetary Movements (Net) Change i n Reserves (Inc. = -)f/ Net E r r o r s t hnissions &ma Items: Pub1 i c Oebt Service IBRD/IDk Debt Service a/ Adjusted t o i i c l v d e unrecorded coffee exports and t o allow f o r v a l u a t i o n adjustment and forelgn stock changes. b/ Unrecorded border exports, o f whlch a l a r g e proportion i s c a t t l e on the hoot golng t o Venezuela. -/ Breakdown i n Leonidas Mora. Arturo Gutierrez and Octavlo Barbosa. "Tendencia do l a Industrialization y del Comorclo E x t e r i o r en Colombia." CIO, Universidad National. March 1970 and DANE. dl Unrecorded border imports. e/ See Table o f Disbursements o f Loans Guaranteed bv Governments Consistent i r i t h Annex Table 1.1 f o r 1965 and a f t e r because reserves i n both places r e p r e l e n t o f f i c i a l holdings of g o l d and f o r e i g n ehchange. but i n c o n s i s t e n t for p r i o r years because reserves i n t h i s t a b l e then r e f e r o n l y t o 8old. Sources: P r i n c i p a l l y InF Balance o f Payments Yearbook, also: Table on Loan Disbursements, lBR0 Economic Reports, IBRO C o n t r o l l e r ' s Department. and IMF.  --- TABLE 1.6 m E X frcr Privats Sector Supplier Credits Gross disbllrsez6%ant ) O t h e r s Privately Pkced Amortization aent - 1 h*2 -2.6 -3ho2 5.8 -20*8 9.7 21.8 -18.2 20.6 -23.9 -17.1 8.2 12.3 3.h -12.9 ~2.8 h.h -12.5 71.2 -26.2 2.2 9.1 6.3 - -10.1 10.0 -11.7 - 36.2 1 6.9 -11.2 12.h -12.0 16.7 -10.8 1 -16.5 l5.h -17.9 38.8 -16.1 37.0 -15.8 Amortisation 1 -10.5 - 375 -86.1 -71.3 -22.0 5.h -18.6 h8.5 -16.6 13.0 -2h.2 ll.7 -31.3 5h.9 -2h.8 7.7 -27.6 17.h -20.0 2b.9 -21.0 8.6 -18.0 Publicly 1 1 sPbsds ~ f m m W l i c Sector I m Gmss disbur~ &wrtizatim Blat i n f h - - - - , __ __ __ - - : ~ 1.7 ~ 2.h . 12.6 7 - 5.3 0.2 S -1 5.8 1 . f -ll.3 2.0 ~ -U.1 2.7 T -l2.h 3.3 3 - S AID U Gmss disbwselrvlt - Ikortiwtim ht ml o u - - - - - 1.5 37.8 59.7 38.1 M6 . 59.8 61.5 86.5 Q.5 Other G o l r ~ ~ m n t s Gross dsburssrsnt - .. hrtiwkim % t inflau - - - - 1.8 0.2 0.7 2.3 1.6 h.7 wtotsl Amortization ht inflcv -3.5 - 5.2 -12.9 TOTAL 156.h 150.9 160.8 222.3 195.1 Amortiwtion 4.1 Bet inflcv -es: IBD Debt lbta, especidllv siacs 1956. i e of P a m t s Y e- , e s p d a l l v for wars prior to 1956. C o l d i a lfniveraity Schcol of hw, %>lit I n t e r n t i d Davelopllent Finurcing i n Colombia" (J- 1963).  COLOMBIA: FOREIGN EXCHANGE RATES (1) (2) (3) (4) (5) Av. Annual Rate Approximate Av. for buying Annual Official Ratio of U . S. Dollars Rate for imports Exchange Estimated Scarcity i n Colombia i n of goods & services Rate Index Scarcity Price t o non-pref erent i a l weighted by volume based on Price of Official o f f i c i a l market of transactions Column (2) Foreign Price (pesos per US$) (pesos per US$) 1958 100 Exchange 00  I 84 - 5 : :i' - -... -= 2 5 72" .- .. - - . " P , F " f. .; : fE3; ; " -.. . " ;* 1 g 1 a - r "> . - ..,-* = - " "".." : ." . , - -, -- -- " E =as.. 51;: ;; : ; " 5 : 4594 -; 2 : -"" . "> : --: - --". E 2 "Ee Z iE ". f " . -. ,.. -" e * s0 "- - " . ass. 7 :r:r "- + * " a iez@ : 8~ 5 " . . = -.. . .. n. j tE 2 : 52 ,... u ; ; : ; 2; .. *> .'. : j: .- e ..". - .. ,r - - .> " 3 .% -a 2 1 $1 ji : I: " "* a ,-e 'A" ? b * ; 5 ; -..* a g$;$gP . .r. z. 2 < 5;; gf 4;; :?i!!! + *-<-* z ~ - $ ; ; ; ~ : ~ 2 ; ~ - < < < < 2 2 2s: I: :z 35s ;$=z! aneaa 2<.x;z -. LU C, I,)".. * .I  IBRD1IOA LOAN b CREDIT COMWITIKNTS --- ANNEX TABLE 2 . 3 ( i n 5 millions) Asriculture 18 Agricultural Credit (Caja) 1 108 Agricultural Credlt (CaJa) Il 624 Agricultural Credit (INCORA) 502 Irrigation 448 Llwstock I 651 Livestock II Oev. Fin. Cos. 451 Five DFCs 1 534 Five DFCI ll 625 FIveDFCsIII Education 552 Canp. Secondary 1 679 Cwnp. Secondary 1l 43 Highways l 84 r i g w a y s II 144 Highways Ill 29515 Hlghways lV 550 H1ghx.y~ V 680 Highways V1 Atlantico i A t l a n t i w 11 R o l l i n g Stock RehaSilitation I Rehabilitation II Electric P n r r Anchlcaya (Cauca) Anchicaya 6 Y& Vvnbo 6 Cal {ma I v"&o c a t i I ~ Gurdalupe 111 (&&I lIn) buadal upe III ware s a l t 0 i t (Bogota) E l Colegio El Colegio 6 Canoas 230 Kv Trmsm. (ISA) Chlvor Lebrlja (Bucaramnga) Cosplqu (Cartagena) Telec~nicatlonr Te le c m - Water Susely Cali Bogota TOTAL  m u a w > I. 5= m - m - - I * U Y 0 a 58 r( rg 0 8 0 -. * m 0 b 0 . 0a C r( 0 W ,a m U e 3 Y m OC e * - n %d PY f *- ez : : I.-N O O.%9 ~ l- m N ? ' . ;p I Y 1 NMM f 3 EQ 3 5s a m 5.3 a'" n o n u 1- YIm -- * c n -m m - 3 K SOc fj j j So C 2 L- n 2" w.. ==Y >- Inn L m - ar 2::a -u Y c -a N I.N 80" 8s C a4 g - 'Im 30- .? -mm I a *,r 95 "D. ;- :: =?! l&m 'g; S LC -mu-x -y iLS3- ij $ M 1 M 1Y1I a--0- r*l!$ S2C zS " O Z m r : i5ESg8 f = U > 1::3j f Y r; E a r n $ ,%r cc u $ 38 2 ~ p:z ! 9 ; & =; 8,: 2 &PScU-,c ;e gx;;z 9E!s:$9 z z  AWX TABLE 3.2 Air hterwaya Rate of Colombia. Preigbt Tnbfic. illio ions o f ton-kns, Rail Truck River Air % of Rate of % Of Rate of s of Rota o f % of Rate of Ton-bas Total G r o w t h -- Ton-IQls Total Grovth % T Ton-kma & Grouth % Ton-hs Total Growth % 56 60 2.6 62 2.5 -8.8 59 1.9 ah.8 62 . 18 5.1 61 l.? -1.6 63 1.7 3.3 56 L.5 -11.1 52 ' 1.3 -7.1 53 1.3 1.9 L5 1.9 -15.1 i9 1.0 6.? P s a w g e r Traffic Sources: Railuays: Colombian National Xailvsys. Air: M N E, Boletin Mensual de Estodist,ica, varicus issues. Waternays: 1950-1956: Jaime S d a z a r , El Tramporte en Colombia. Presidencia de l a Hepubllca, %gota 1 x 9 . Wateneyr: 1957-63: WNE, Boletin k n s u a l de Estadistice, various i ~ s u e s . Freight Traffic Sources: Rail Traffic 19514%: N a t i ~ n r dRailroads of Colombia, Outlook f o r Freight Traffic 1967-1976. Prepared by Hadigan Hyland, de l a Cruz. Rail Traffic 1967-70: Ferrocarriles Nacionalea de Colombia. Truck, River. Coastal shipping and pipelines (1958-1966): Harvard J n i w r s i t y : An analysis of Investment Alternatives i n the Colombia Transport System. Transport Research Program; Jambridge, baa. Truck, River and PLpslima 1951-1957: Parsom Brickenhoff: Plan for hprovoments i n 'iati~;al Trans- portation, Colombia, Ministry of Public Works, bcenber, 1901. Air 1950-57 and 1967-70: MNE, Boletin Me?sud de Estadistica, varitus ~ s a u s s .  ANmX TABLL 3 . 3 / Colombia. Construction of the Atlantia Railroad! Proleered and Actual Construction C o s t s Through % J - p l Estimated Cost Actual Cost A m u n t o f OverlUnder Spemdinq Peso Costs (000's o f 1968 Ps) La Oorada- - Garnarra Gamarra- Fvndacion - - Total Atlantic RR La Oorada- Gamarra Camarra- Fundacion Toral Atlantic RR - - La Gamarra Oarada- - - - Gsmarra Fundacion ~otal qtiantic R R Addhistration Engineering Earthuork Construction Materials Construction Const. Rolling Stock Ballast Ties. Rails b Acc. Fences C Right of Way Brldges b Structures Comunications Stations b Facilities Provisional Maintenance Contingencies Capulua Consultancy Total Administration Engineering --.. .. . Earthrark .. Construction Materials Construct ion Const. Rolling Stock Ballast Ties. Rails b Acc. Fences b Right of Way Brldges 5 Structures Cnnnvnicat ions Stations b Facilities Provisional Maintenance C~ntingencies Capulco Bogota Workshops Conrultency Total Total Cost u -$ s Equivalmt) Ahinistratlon Engineering 2.26 Earthwork 3.01 Construction Materials 3.43 Construct ion 4.93 Const. Rolling Stock 0.27 Ballast I.48 Ties. Rails 6 Acc. 6.12 Fences 6 Right of Way 0.23 bridgos t Structures 6.52 Comunicatlons 0.55 Stations b Facilities C.83 Provisional Maintenance Contingencies .49 I Capulco 3.20 Bogota Workshops 3.62 0.74 Consul tansy - Tot a l - 38.68 a1 Financed with Loana 68-CO and 119-CO. Source: Colmbia. Ministry of Public Works. Madigan-Hvland Monthly Proareas ReDorts on the Constraction of the Atlantlc Railroad (1923-1961).  - -- ANNEX TAELE 3.4 a / 1958-1968 Colmbian National Railrays Annual Expenditure on Railroad Rehabilitation ~rogram-, (Thousands of Fmllars and 1968 Pesos) Up to 1963 - Total Roiling Stock and Spares (000's of US$ equiv.) 10,091 3,242 Diesel and Spares (000's of US$ equiv.) 5_1768 18,611 Loans (000's of US$ ) 5.768 17,179 Govt. Funds (000's of US$) 1 ,386 Govt. Funds (000's of 1968 Ps) 725 Frei~htCars 6 Passenger Cars (000's US$ e q u i v . ) m 14,741 Loans (000's of US$) !,985 13,177 Govt. Funds (000's of US$) 755 Govt. Funds (000's of 1968 PS) 12,876 Others (000's of US$ equiv.) & L ~ o a n s (000's of US$) Govt. Funds (000's of US$) Govt. Funds (000's of 1968 PS) .1 38 2 200 41 2 3,035 38,847 Shops and Track Rehabilitation (000's of US$ e q u i v ) x 30,058 Rails and Accessories (000's of US$ equiv.) 6,113 Loans (000's of US$) 3.621 Govt. Funds (000's of US$) 2 .L90 Track Rehabilitation ('000s of US$ equiv,) 14,612 Govt. Funds (000's of 1968 PSI 232,336 - Others (000's of US$ equiv.) - 10 u2.2 4.544 Loans (000's of US$) 10 Govt. Funds (000's of US$) 2,877 Govt. Funds (000's of 1968 PSI 30.41 1 Mi scel 1 aneous (000's of USS equiv. j - 222 Govt. Funds (000's of 1968 PS) 15,178 - Total (000's o~ US$ equiv.) 10,101 70,255 Loans (000's of US$) Govt. Funds (000's of US$) Govt. Funds (000's of 1968 Ps) a/ Government expenditures have been partly in pesos and partly in dollars. The two components are shown separately i n this table, and the peso expenditures are given in pesos in their respective lines but included in subtotals for each particuiar item in terms of their dollar equivalent. b/ These figures represent total expenditures up to 1964, financed with Loans 68-CO, 119-CO, 2 6 7 4 0 and 34340. Source: Colombia. 1) Ministry of Public Works. #adigar.-uyland M o m Progress Reports on the Railway RehabiliLatLur~Plugram. 1963-1968. 2) Loan Files: 6 8 4 0 , '119-CG, 26740, 343-C0.  Lda* 7 ee.4 m.3 t#i n,.. W.% A&, m D a . l 1 A. , a;: PL.7 Abr m.0 m. a W.6 a3 . 818.7 4.7 19a.9 dlb.9 1.97,8 +:$; 4;;; B.8. a.8 w.0 R w.9 . e m.s ea.1 9%.? IZP. 5 Iw.9 *I701 m.9 18: ; g; PhI.0 &ti ew.1 0l9.6 W.6 *U,9 Ad. a*.. 38-:'N USu lnchlcyr unit8 1 and ? 11 ?ommat hydro th.0 l63.0 339.0 $01.0 -.- - AaWl a,.. A,., .. m n. d . ..E i3;g *19.? kshleaya m i t a 1,2, and 3 A~turl It 26560 3S.2 lB.6 tu.1 %J.t n.. n.. a.n. M.7 Y u B o uric 1 Ponoart Auturl K I 6 ... g:i 61.37.0 d6.6 I. .. A* . a,. a.4. *U.b 90.. fad. .. .A X w k , unit8 1 md 1 Perreart 9.9 2U.6 n. a... .. R Actual n.. 263.0 *>la9 n.a. 0.8. 8.4. . .tA Y u B o unit 3 FOFOC.~~ 37.6 li0.9 Yuclk, u s l w 1,a, .ad 3 Aetual Porrut 83.9 h7.9 1%.1 m.7 ra.7 U3.3 1U.1 8.a. 17: n. : 170.9 1M P . A* . ra.9 b t ~ l n.. Pab).8 *Pl.J a,.. n. 388.5 (1.0. Y c4lir Mlt8 1 Qd P Wlm W t r 1,2,3, and h Fomc.at AetlU1 toncbat 133.0 U6.5 03.4 37h.7 M3.3 4h0. 7 7.6 271.1 887.0 m.9 110.5 1m.3 Vs.8 &. bkP.0 1 &I.? 0U.L Act1881 171,2 351.6 46.1 190.9 a.9 3v.a rW.3 Alto h h i c y a t F- 71.b ml4.L 150.2 70.6 21.a Actual n.. n. 8.r. ., A n. A ., an. 39-W 1951) A L Inmula usltm 1 and 2 ' Porwut hydro 20.0 100.5 296.3 296.6 loQ.6 m.7 ba.3 Actual b&o 20.0 W.6 2Ols.b k25.0 7.1 160.3 301.7 W a d *13.1 21,'-fO 195) Ir tnmmld. w i t 8 1 n d 2 Fora~aat hfgo 26.6 185.5 115.0 2Z0.5 156.8 ZPI.1 877.9 Aotwl )yea 26.6 97.1 th2.7 339.8 1 196.L . Q & . z sn.5 U 1966 d0FFmirotnltrlQdt Foncut WCo 0.0 t4.5 71.8 136.3 to.9 TL.7 W.6 Actual hydro 90.0 n.r. n.. n.6. n.r, n.. a f. . n -.a Sm Fr.nct8~0PRIta 1.2, . ~ 3 d Foncut htdro 135.0 h3.0 17.6 90.8 3 .& ' 6I9.e 97.1 ~turl klrgo 135.3 U1.9 61.7 116.6 *?7.? 26.1 66.3 1S.L .S.l - - - +' 1 ~ 1 1 ~ k ,t1.b . y t or vac.rlta C , ~ ~ W O W a, - 4 c-ta. t/ ?~..-.UQII 78.6 ~ c a oft (k.C.ritr dm, twawolr, Qd mllnmlly w r w . zr h 1 v d W 20 B.16.Rt Of W 3U18 G Q I D n BOltO h r ~enmtMctimt - inClu0.. ooet of NeonQ rt.C. of 0 U t . V l t . dm, I 1 U. I1 m I ln #8t.tioQ. and Q(111 of W n 313'8 QQaon certr eonrtfwtion .pulprat. dlvwoim ct tha Catb.poIm 8M Zl(loh. r i r O l . dtnrmlen of tha Comepalm md T w k . rive8 8rim Includ. n . l l a n o * far the n l m lute Won 4 1 l m Ca @&iga i ?n of 115 m t m t a d r r i o n w w r t n n t rnQr - 1 225 ma tam in teW.  h e of kr(ue8tm ~nti k r d en slr*.Iud Uwtr ( m t w IVbO rmtrv8#) n n,r, n.r, 4 9 I 3 6.9 7,1 7,9 7,I 1.6 tI.9 9.1 9 8.8 e,r,  --- ANNEX TABLE 7.1 LV I ESTOCK EVELOPFSNT PROJECT ACTUAL VS. PROJECTED WESTNEEIT P ER 3EEF CATTLE RANCH (LA COSTA) (in Constant 1968 Pesos and US Dollars) m a Cattle T&al Irarestwant per F8fw per mad per Ha. md- Stock per Farm per F. Head Bulls per Fama per B. Head LBlZd Clearance b/ per Farm . C per L . Ha. per Head : Improved Pastures / per Farm per I. Ha. per Wead per per per Head per Fam per b a d Fanil Buildings per Farm Water Supply t Salt Licks per Farm per Bead per Ha. F%chinely & Equipsent per Farn per Head Irrigation per Faran a/ Including crops and mountainous areas. G/ The pro&ct financed 215 hectares per fann as compared ta 25 hectares planned a t appraisal. - z/ !he ppraact finamed Wil hectares per fann as compared t o 50 beckires planned a t appraisal. The figures i n the appraisal report were converted into colstant 1968 Pesos by multiplying them with a factor of 1.36. E W v w t US$ figures were cbtdned by dividing the coristant 1968 Pesos by a factor of 1 5.9.  --- ANNEX TABU3 7.2 LlYESmK DEVELOPMENT PROJEC r ACTUAL VS. PROJEC'ED PROJECT PARABW"I'RS - proflam) (Total Project Including La Costa, Los Llanos, Narino-Gauca, and Sheep - -(In Constant 1368 Pesos and US$) Actual PrP j e c t Investments M s t r i b u t b n of Inves Comitted t h o u g h 3/31/71 % Total in Pesos Total in US$ u d clearance Vater Supplies Fam b h - r y ailding ing Stock - Equiptent Contractor' s Machinery Dairy Cooperatives Technical Services others Total Mstribution of F i ~ n c i n g Baef Dairy Seep Total Fann Coverage (#) Beef Cattle Beef Cattle - - La C o s t a Los Llanos Dairy - Warino-Cauca P -  ATIMTICO 110. 3 IWLIOATDl M D W I D AeCLAFUTlOl PI)OJECT --- MXT E ABLE 7.3 -----------------------------___-__________ ACTUAL - - - - - - - - - - - - - - - - - - - - - - - - M . ~ ~ ~ - ~ ~ ~ - - - ~ ~ ~ ~ ~ - k. of f.nrrs: (h.1 - 1 Yield ( Frlmpartan per b.. Total Prodaction Ccats pr b .. llet Incoaa per ha. b r (100~)d per h a. Cwrh @tams p r ha. Project w m m d T c u s psr br. Sat W l y Incas p s r ha. Price par ton C-utpnt p rha. Variable Rcdoction Wta p r ha. Total W r Impnts par ha. Total R0dtr:tIon Costs par ha. bt I n- pr ha ~ ~ l r- rl y &$ /( I) per ha. Cash b t w n s psr ha. Projsct Ch.rgss and T a s s par ha. Bet Fanily Inoons per ha. S t a m I1 Appraisal Report (PA-&) b e c a w no detailed bmakdown of crop production par@at%rs was given In the Appraisal Report of Stwe 1 . 71 &tares of sorghum, 187lr hectares of sesame, 65 hectares of cottun, and 6 hectares of soybeans. a l a r w groilp fam- d e r ths more favorable conditions a x l t i n g In the pmject area. The 8-10 covers 79% of ths sorghun *od loss of PS (-379) per hsctare, while sesame yielded 539 kgfha and a net gain of Ps 758 w h e c t ~ e . e figtnso l i s t e d above, LO., thq p r o ~ t s d of ~ ~ $ 9 a m t inco~e pw0 hectare (Ps 1500ha) a s cowwed ircputs. Actually, homrer, a significant, although mtnrpecifbd woportion of labor inputs, was proridsd by t4, it i s llkely that famars' cash returns are lover then indicated above. h/ Eracketad flgures are hyptb.tic.l since farmers do not pay t a m s and project charges. I/ In 1968 and 1969 soma of tb sesans was sold outside official (cooperative) chmnels d thsrsfore i s not reflected i n thew figums: this phew- hod men b m a t control by 1970. It i s of coursa very = b a r b n mueh m y have been so sold but IWC0R.A. officials have indicated that it mav have bmn as mch as 30% of the nrpn. Adjusted yields would then be 526 and 286 kgs., md cash returns per hsctare $38.6 md $30.0, respectively for 1968 md 1969. Wok: Current psos were c o m r t e d into conatant 1968 pesos by multiplying thew with a rector of 0.33 for 1969 Pesos, 0.86 f o r 1970 Pesos. The exchrm~rate wed 1s: 1 U S = Ps 16.38.  COLOMBIA PROJECTED PATTERN FOR A N EFFECTIVE IMPLEMENTATION OF AGRARIAN REFORM ... .. .. .. ... . .................... PARCELIUTIOPI (UND REDISTRIBUTION) COLONIZATION IRRIGATION DISTRICTS 1 962 1970 1 975 1 980 1985 1990 1995 2000 Source: INCORA - Lo Realidad Rural y Lo Refwma Agrrrrio Como F o c t a de comb;^, Oficim de ~!oneac:&. 1970. \ Leks M@@d@Iswe COLOMBIA HIGHWAY RAILWAY NETWORK 1 970 - - dnpaved h ~ g h w o ~ s - -- 1BRD