Announcement of Ten Million US Dollars to Help Finance Livestock Development in the Trans-Juba Area of Somalia on February 7, 1974

.. .;J • INTERl~ATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET.NW, WASHINGTON D. C. 20,433 TE'.LEPHONE EXEc-UTlVE 3-6360 IDA Press Release No. 74/8 Subject: $10 million to help finance February 7, 1974 livestock development in the Trans-Juba area of Somalia The International Development Association (IDA), an affiliate of the World Bank, has approved a credit to Somalia equivalent to $10 million to help finance livestock development in the Trans-Juba area. Somalia, which forms the Horn of Africa,is recognized as one of the Least Developed Countries in the world. There are a few natural resources and most of the population depend on livestock and subsistenc~ crops for their livelihood. Much of the country is arid, water supplies are • scattered and subject to periodic droughts which bring great hardship to b~:h the people and their livestock. Most of the rural population are nomadic pastoralists and livestock has gre&t unexploited potential for development. Among a number of con- straints against increased supply of livestock are lack of feed and disease control, inadequate marketing and water facilities, with conse- quent weight loss during transportation. The present project which is the first Bank Group lending for agriculture in Somalia will cover an area of about 25,000 square miles 2 (65,000 km) in the southwest corner of the country. It will concentrate on cattle marketing and fattening to improve herds in the project areas. The project has the following components: construction of five markets, development of water supplies, staging points and improvement in stock • Note: Money figures are expressed in US dollar equivalents. / more  - 2 - routes; construction of new holding grounds with a capacity of 30,000 head per year, bush clearing and development of water points; cattle fattening facilities including the establishment of grazing ranches and • the establishment of a pump-irrigated fodder farm and feedlot supplying about 25,000 cattle per year; the construction of five VEterinary centers and di:spensaries for disease control; technical assistance and the financing of operating costs. The technical assistance component includes provision for key project staff, the training of local staff, and feasibility studies for future agricultural development. 'nle project will be executed mainly by the Livestock Development Agency (LDA) which is under the general direction of the Ministry of Live- stock, Forestry and Range. At full qevelopment in the sixth year it is expected that the project will make available for marketing by LDA 52,000 head of cattle annually, resulting in an incremental carcass weight of about 3,900 tons. About 25,000 will be exported as chilled or frozen beef, 19,000 as canned beef • and 8;000 as live animals. The project will help Somalia to expand and diversify its beef markets. The disease control program will facilitate the export of Soma.J.i products to European markets presently precluded on sanitary grounds. The total cost of the project is estimated at $11.5 million, of which about $7.3 million represents foreign exchange requirements. The Government will finance $1.5 million. The major portion of the IDA credit proceeds will be relent to the LDA for 20 years including five years of grace. Interest will be payable at 7-1/4% per annum, but deferred during the grace period and capitalized. The IDA credit which is being made to the Somali Democ.·ratic Republic is for a period of 50 years, including a 10-year grace period. - 0 - It is interest- free except for a 3/4 of 1% service charge to cover IDA's administrative expenses. • • INTERNATIONAL DEVELOPMENT ASSOCIATION ' ~-; • ~. r-1 ~.., T ~-:: ;.· T N \'\' WASHINGTON 2 5 D C '. HO•.; E EXE•.:UT!\'E 3-6 3 6i."l TECHNICAL DATA PROJECT: Livestock development project COUNTRY: Somali Democratic Republic (The beneficiary is the Livestock Development Agency (LDA) TOTAL COST: $11.5 million (including taxes and duties) IDA FINANCING: $10 million, 50 years, 10 year grace period, interest-free except for a 3/4 of 1% service charge to cover IDA's administrative expenses. OTHER FINANCING: Government of the Somali Democratic Republic, $1. 5 mil lion . •• IMPLEMENTING ORGANIZATION: PROJECT DESCRIPTION: LDA, under the direction of the Ministry of Livestock, Forestry and Range, Mogadiscio, Somalia. Construction of five cattle markets, one new holding ground, and development of water supplies and staging points and other improvements along stockroutes; establishment of two grazing ranches; construction of an irrigated fodder farm and a feedlot; disease control; and technical services, training and feasibility studies. PROCUREMENT: Civil works for irrigation, drainage, access roads and equipment including tractors, trucks and vehicles costing $2.8 million will be subject to international competitive bidding. Construction of boreholders, buildings, water and stock-handling facilities for the new holding ground, the grazing ranches and the irrigated fodder :.1rm and feedlot, at an estimated cost of S0.8 million, will be subject to local competitive bidding. CONSULTANTS: Consultants will be employed for the following services: irrigation engineering, key project • administration, and feasibility studies • ESTIMATED COMPLETION DATE: 1980