Tunisia - Second Power Project

Document of F70 ~~~~~The Woirid 1Bank IOIFa ODF7fCfAL USE ONLY Report No. P-1958-TUN REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO SOCIETE TUNISIENNE DE L'ELECTRICITE ET DU GAZ WITH THE GUARANTEE OF THE REPUBLIC OF TUNISIA FOR A SECOND POWER PROJECT December 13, 1976 This idoement bs n mrescdeed fstafbemai Qnnsl my be usd by recipients only to the peirfonmmce of | theAr oflcki denties. lts eomtemts may uno oftierwise be d3isclsed wifitout World ffi3rnk anthoriztion.  Currency Unit Tunisian Dinar (TD) The exchange rate of the Tunisian Dinar is floating. The rate used in the appraisal report, which approximates the current rate, is: US$ 1 TD 0.429 TD 1 US$ 2.33 TD 1,000 US$ 2,330 TD 1,000,000 US$ 2,330,000 Fiscal Year January 1 to December 31 Abbreviations BDET Banque de Developpement Economique de Tunisie COFACE Compagnie Franqaise d'Assurance pour le Commerce Exterieur COFITOUR Compagnie Financiere et Touristique GAFSA Compagnie des Phosphates et du Chem:Ln de Fer de Gafsa STEG Societe Tunisienne de l'Electricite et du Gaz  FOR OFFICIAL USE ONLY INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO SOCIETE TUNISIENNE DE L'ELECTRICITE ET DU GAZ WITH THE GUARANTEE OF THE REPUBLIC OF TUNISIA FOR A SECOND POWER PROJECT 1. I submit the following report and recommendation on a proposed loan to Societe Tunisienne de I'Electricite et du Gaz with the guarantee of the Republic of Tunisia, for the equivalent of US$14.5 million to help finance a second power project. The loan would have a term of 14 years, including 2-1/2 years of grace, with interest at 8.7 percent per annum. Additional financing of about $9.2 million for the project would be provided by a consortium of private banks. Their loan is expected to have a term of about eight years, with interest at 7 1/2 percent per annum. PART I - THE ECONOMY 2. A report entitled "The Economic Development of Tunisia: A Basic Report" was distributed to the Executive Directors in January 1975. Since then, two updating economic reports, both entitled "Memorandum on the Economic Position of Tunisia", were circulated on May 23, 1975 and September 17, 1976. The main conclusions of the basic economic report and the updating missions are reflected below. Country data sheets are attached in Annex 1. 3. Tunisia's development has been hampered by scarcity of natural re- sources. Much of the country is arid or semi-arid, and agriculture is highly dependent on rainfall. Minerals are mostly of low quality and, apart from phosphates, limited in quantity. Relatively small quantities of petroleum were discovered in the mid-1960's and have since become an increasingly valuable source of revenue and export earnings. Industrial development has been handicapped by the small size of the domestic market as well as a lack of skills and experience. Tourism has developed rapidly and workers' remit- tances have become a significant item in the balance of payments. Tunisia has enjoyed a large amount of external aid and used it to expand economic and social infrastructure, broaden the industrial base, make available a wide range of social and welfare services to a large part of the population, and increase the rate of growth. Per capita GNP increased by 4.2 percent annually from 1961 to 1975. Like most countries, however, Tunisia has not yet found adequate ways to cope with unemployment and poverty and to achieve a balanced distribution of consumption among income groups, between urban and rural areas, and among regions. 4. Government strategy in the 1960's relied heavily on central plan- ning of investment and resource allocation, with the public sector playing a major role in production as well as providing infrastructure and services. Foreign exchange shortages and concern with inflation led to recourse to a pervasive system of price determination and controls. An unusually long This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  - 2 - series of poor crop years due to shortage of rainfall slowed the growth of output. Many of the investments in public enterprises proved to be un- economic and private initiative in most sectors except tourism and petroleum was limited. 5. The Government's present development strategy was introduced in the early 1970's. Its principal objectives are: (a) accelerating growth based on export-oriented industries, by encouraging private initiative, reducing direct Government involvement in production and relaxing administrative regulations; (b) creating jobs, primarily in the expanding industrial sector, encouraging worker emigration, reducing population growth and improving education and training; and (c) maintaining internal and external financial stability. The 1973-76 Fourth Plan set a target rate of GDP growth of 7 percent, providing for a 5.4 percent growth rate in per capita private consumption. Investment was projected to increase by 80 percent above the level of the 1969-72 Plan. National savings were to finance three-quarters of investment. Exports of goods and services were projected to grow at 8.8 percent per year at constant prices and imports at 12.2 percent. The Plan foresaw net external capital inflows increasing by 55 percent over 1969-1972 average levels and providing 23.5 percent of total investment. Debt service was to be held to below 20 percent of exports. The original Plan targets were conservative in terms of both growth and savings potential, particularly in view of the favorable impact of the changed petroleum and phosphate prices on the Tunisian economy (paras. 9 and 10). 6. The real growth of GDP has accelerated since 1970, reaching 9.6 percent per annum during the period 1970-75, compared with 4.6 percent during the previous decade. The acceleration can be attributed partly to fortuitous factors such as good weather, leading to record cereal and olive crops, partly to important growth in tourism, petroleum and phosphate revenues and workers' remittances, and also to the general reorientation of Government policy since 1970, which renewed self-confidence and initiative in the private sector. Ex- pansion of manufacturing and phosphate production has been significant. By 1975, per capita GNP reached $760 (1976 Bank Atlas estimate). Investment remained high in relation to GDP - 22 percent in 1970-75 compared to 23 per- cent during the 1960s - while national savings rose sharply from an average of 13.5 percent of GDP at current prices during the 1960's to 19 percent during 1970-75. Consequently, the share of external borrowing in financing investment dropped from 44 percent in the 1960's to 13 percent during 1970-75. 7. The balance of payments was in overall surplus from 1967 to 1974 and since late 1973 benefitted greatly from sharply improved terms-of-trade. How- ever, in 1975 the terms of trade began to deteriorate, the demand for Tunisian exports sharply decreased, and despite substantial disbursements on external borrowing, international reserves declined by 11 percent. At the end of 1975, net reserves amounted to $344 million, equivalent to about 3 months of imports. 8. Tunisia has maintained relative price stability, thanks to prudent fiscal and monetary policies and a skillful use of price controls and of price  - 3 - subsidies for basic consumer goods. Consumer price increases averaged 4.2 percent annually during 1970-74. There was, however, a 9.6 percent increase in consumer prices in 1975, largely because of increased export and import prices. During 1970-74, the official GDP deflator rose at an average annual rate of 8.9 percent and average investment costs increased by 9.6 percent. The increases in these two price indices in 1975 were 5.2 percent and 14 percent, respectively. 9. Despite the terms-of-trade loss in 1975, Tunisia still is on balance a beneficiary of the changes in world market prices since late 1973, but this favorable situation will probably change in later years. MIainly because of sharply higher prices for petroleum, phosphates and olive oil, export earnings rose from $714 million in 1973 to $1,254 million in 1974 and $1,328 million in 1975. On the other hand, increases in import prices, combined with higher domestic demand, caused payments on imports to grow from $782 million in 1973 to $1,242 million in 1974 and to $1,525 million in 1975. The gains from changes in terms of trade since 1973 are projected to disappear around 1978 or 1979, as a result of the expected stabilization or decrease in the prices of Tunisia's major exports, and further increases in the prices of imported industrial goods. At the same time, workers' remittances may continue to be restrained by slower economic growth in W4estern Europe. Taking into account likely capital inflows through direct investment and external aid, the level of net reserves is projected to be equivalent to about 2.4 months of imports at the end of 1976 and to remain at this level during the remainder of the decade, when the balance of payments may reemerge as a serious constraint on Tunisia's development. 10. The recent changes in Tunisia's balance of payments position and in Government savings do not call for a substantial revision in development strategy. They suggest rather that Tunisia should continue its efforts to achieve high investment and GDP growth rates. Since workers' emigration to Europe and Libya is now limited, the effort to increase investment, particu- larly in labor-intensive industry and agriculture, should be increased. With an adequate savings level and continuing external aid, the Tunisian economy has the financial resources that should enable it to sustain an average an- nual growth rate of between 7 and 8 percent during 1976-81. The level of future growth would also depend on continuing efforts to stimulate private investment, to increase the international competitiveness of industry, and to improve the planning and implementation of public investments. 11. Tunisia has made impressive social gains. By 1974, primary school enrollment had reached 96 percent, and secondary enrollment, 20 percent, of the relevant age-groups. Public health services have been greatly expanded with many provided free. A family planning program has been introduced. Total social expenditures during 1970-75 increased by about 10 percent per annum and on average accounted for 9 percent of GDP and for 30 percent of total public expenditures. Nonetheless, major social issues remain. Further  - 4 - progress is needed in land reform and in creating employment. The unemploy- ment rate was estimated at 18 percent in the non-agricultural sectors in 1975, and underemployment in the rural sector is high. There has been a growing concentration of productive activities in a few urban areas, espe- cially in Tunis. 12. So far as can be judged from available data, there has been a gradual improvement in income distribution. During the 1960's, real incomes increased in all sectors but by a higher percentage in the modern sector than in the rural sector, due partly to the series of poor harvests. In the modern sector, especially in industry, increases in real incomes in the 1960's ex- ceeded the rise in productivity; the income distribution trends favored in- dustrial workers. Thanks especially to the income redistribution efi-ects of free social services, the proportion of the total population living in poverty was substantially reduced during the decade. About 90 percent of the poverty group lived in rural areas. Since 1970, higher agricultural output, increases in minimum agricultural wages, tax exemptions for low incomes, the inflow of workers' remittances from abroad and the stabilization of basic commodity prices through Government subsidies seem to have improved the absolute, and possibly also the relative, position of the poorest social groups. [n rural areas substantial income disparities remain, in part as a result of the structure of land tenure. 13. During 1970-75, agriculture provided nearly half of total employ- ment, 29 percent of merchandise exports and 19 percent of GDP. Food process- ing accounted for another 3 percent of GDP and over a third of value added in manufacturing. During this period agricultural production rose substantially, largely as a result of favorable weather. The potential for further growth is clear. While large infrastructure investments were made during the 1960's, current policy has emphasized projects that make a rapid and direct contribu- tion to production and recognized various constraints on agricultural develop- ment: absentee ownership, insecurity of tenure, inadequate access to agricul- tural credit, inadequate extension services, insufficient agricultural educa- tion, and underutilization of irrigation investments. Under the Fourth Plan, more than $140 million was allocated to a rural development program executed by the provincial administrations. 14. During the 1960's, manufacturing production in Tunisia increased by 8 percent annually. There has been a remarkable acceleration of growth in the 1970's due in part to record years for the olive oil processing industry and to favorable developments in the textile and chemical industries. The early thrust of industrialization was supplied by large import substitution projects in the state sector. These suffered, however, from the limited domestic market and shortages of experienced staff and management. Mlore emphasis has been put on export-oriented private industries since 1970. Under the Fourth Plan, private manufacturing investment, particularly in food processing, textiles, fertilizers and metals transformation, was expected to average D 25 million per year, compared with D 12 million in 1972, and to  - 5 - account for two-thirds of total investment in manufacturing; these targets have been exceeded. Foreign and domestic private investment is now stimulated by a comprehensive incentive framework, and facilitated by the streamlined approval procedures of the investment promotion agency. Foreign investors are expected to contribute know-how and overseas marketing. A new agreement between Tunisia and the European Community was signed in April 1976. It provides for duty-free entry into the countries of the Community of nearly all Tunisian industrial products. The Government has established a special fund to encourage growth of small industries and industrial decentralization, and has started a program to establish industrial estates. 15. The development of tourism in Tunisia is relatively recent. Foreign- visitor arrivals reached a level of 780,000 in 1972, with an annual rate of growth over the period 1961-1972 of 30 percent -- higher than that of any other Mediterranean country. While 1973 saw a drop in the number of visitor nights, and 1974 registered another overall drop, there was a very strong recovery in 1975, with over one million visitor arrivals. Since 1970, earn- ings from tourism have been a major source of foreign exchange, having reached $300 million in 1975. The rapid development of tourism in Tunisia has unfortu- nately been accompanied by an inadequate development of infrastructure (par- ticularly recreational facilities), shortages of trained manpower and inade- quate services. The Government is endeavoring to alleviate these constraints through a variety of measures, including revised investment incentives, in- creased marketing and training efforts, codes to enforce quality standards and more stringent zoning laws. 16. Since the early 1960's Tunisia has obtained relatively large amounts of official aid. A Consultative Group provides a forum for aid-coordination among major donors (see para. 25). During 1970-74, annual loan commitments from public sources averaged $136 million, or about $26 per capita. About 69 percent of these commitments came from bilateral public sources, chiefly from France (14 percent), the United States (13 percent), and the Federal Republic of Germany (11 percent). About 12 percent came from oil-producing countries, whose share rapidly increased from 8 percent in 1970 to 26 percent in 1974. Commitments from the Bank Group during 1970-74 accounted for 29 percent of total public commitments. Most aid has been obtained on concessionary terms: during 1970-74, the average terms of borrowing from bilateral sources were 3.5 percent interest and 23 years to maturity, including 6 years of grace; from multilateral sources, they were 6.0 percent interest and 26 years to maturity, including 5 years of grace. During the same period Tunisia also received annually some $40 million in grants. Loan commitments from private sources average $32 million a year. Direct foreign private investment has been comparatively small, but recently it has picked up momentum following increased activity in the petroleum sector and new incentives offered to foreign investors in manufacturing. Thus, net direct foreign investment increased from $19 million in 1970 to $76 million in 1975. 17. Tunisia's total public debt outstanding (including undisbursed) in- creased from $846 million at the end of 1970 to $1,444 million at the end of 1974 and an estimated $1,700 million at the end of 1975. The disbursed portion  - 6 - outstanding at the end of 1974 was $956 million, equivalent to 27 percent of GDP, compared with 40 percent in 1970; it is estimated at $1,160 milLion at the end of 1975. Debt service payments in 1975 were 7.8 percent of export earnings compared with 19.5 percent in 1970. This significant decline in the debt service ratio was mainly due to the sharp increase in export earnings following the changes in world market prices in 1973 and 1974; it also reflected reduced borrowing abroad, and Government efforts to change the structure of the foreign debt. In the future, Tunisia will have to continue to rely heavily on foreign financial assistance in order to reach its develop- ment goals. While Tunisia is capable of servicing substantial additional debt on less concessionary terms than in the past, it nonetheless should continue to seek a large part of its external resources on concessionary terms in order to maintain the debt service at a manageable level in the long run. PART II - BANK GROUP OPERATIONIS IN TUNISIA 18. Since 1962, Tunisia has received a total of twenty-six loans and ten credits amounting respectively to $326.9 million and $70.1 million, net of cancellations and refundings. Annex II contains a summary statement of Bank Loans, IDA credits and IFC investments as of October 31, 1976, and notes on the execution of ongoing projects. 19. The Bank's lending strategy aims at supporting Government efforts to (a) increase employment, (b) encourage more balanced growth and distribu- tion of income among regions and income groups, and (c) promote export- oriented policies and investments. The key supporting feature of this lend- ing strategy is to encourage the Tunisian authorities in timely and well-coordi- nated preparation of projects, with emphasis on technical assistance. The Bank is also cooperating with the Government in its efforts to increase the mobilization of domestic and foreign resources, in part through encouraging project co-financing; the latter is particularly important in view of the extent of Tunisia's external resource needs, the large scale of many priority projects, and the limited availability of Bank resources. This latter effort is a prime objective of the proposed project (see para. 38) and is also supported through the Consultative Group (see para. 25). 20. Within this broad framework, past Bank Group lending has emphasized support for long-term investments in infrastructure and social development. Lending for urban and social development, including water supply, education, family planning and the Tunis urban planning and public transport project has accounted for 33 percent of Bank/IDA commitments in Tunisia. Lendirng for transport, power and tourism infrastructure has accounted for a further 33 percent. Agriculture and fisheries have received 12 percent of total commit- ments. Industrial and hotel financing through the Banque de Developpement Economique de Tunisie (BDET) has accounted for 16 percent, and the GAFSA phosphate development project received 6 percent of total commitments. While there have been some problems, project implementation on the whole has been satisfactory. In a number of sectors, important institutional improvements have been achieved and independent agencies have been created or strengthened.  - 7 - 21. In agriculture, Bank involvement in several sub-sectors has met in some cases with success, in others with difficulties. The first agricultural project financed by the Bank Group was the 1967 Cooperative Farm Project, completed in 1973 after substantial delays and revisions causecd by changes in Government agricultural policy in 1969. The First Agricultural Credit Project (Loan/Credit 779/263-TUN, $8 million, of 1971) should be fully disbursed by the end of 1976. A 1971 IDA-financed Fisheries Project (Credit 270-TUN, $2 million), aimed at development of Tunisia's inshore fisheries, is expected to be fully disbursed in 1977. A loan for an Irrigation Rehabilitation Project (Loan 1069-TUN, $12.2 million) became effective in September 1975; project execution is in its early stages. The Bank has also attempted to play a more active role in rural development in Tunisia, but no specific project in this field has as yet materialized. Our experience to date has, however, served to underline the necessity for very close coordination and careful preparation of future projects in this difficult but high priority sphere. 22. Lending in the current fiscal year and the period ahead will seek to approach the problems of rural and regional development increasingly through an emphasis on projects promoting agricultural and industrial production, such as the Second Agricultural Credit Project recently approved by the Executive Directors, and urban and social development. Complementary to this primary focus, the program would also finance selected priority projects in infra- structure, particularly in power, such as the project proposed in this report, and in roads. The project proposed in this report meets the latter criterion, as it would contribute to ensuring continuity of electricity supply and would strengthen the institutional framework of the power sector. The Sidi Salem Multi-purpose project, also to be processed in the current fiscal year, would support the first phase of execution of the Water Master Plan for Northern Tunisia, consisting of: (i) construction of the Sidi Salem dam and reservoir providing water for potable, industrial and irrigation purposes; (ii) con- struction of an interconnection canal to Tunis and the Cap Bon Peninsula; (iii) irrigation infrastructure and rehabilitation for some 16,600 ha, and (iv) a 25 MW hydro power plant. Other projects under discussion with the authorities include a fourth Water Supply Project, a second Fisheries Project, a Rural Roads Project, and a seventh development finance company project. Further direct lending for priority industrial sub-sectors in which Tunisia has a comparative advantage will depend on progress achieved in the formula- tion of sound projects. In addition, an economic mission to review the Fifth Plan is examining the Government's rural development plans in an effort to identify areas where Bank lending could be focused. 23. The Bank Group accounted for about 17 percent of disbursements of official assistance to Tunisia between 1970 and 1974. The Bank Group's shares in total debt outstfanding and disbursed at the end of 1974 (including loans from private sources) and in debt service during 1974 were 14 percent  - 8 - and 12 percent respectively. Over the rest of the decade, the Bank Group's share in disbursed external debt is expected to decrease to about 10 percent, as will its share in debt service. 24. IFC has invested in NPK Engrais (a fertilizer plant), in BDET, in Compagnie Financiere et Touristique (COFITOUR, a company to promote and invest in tourism projects), in Societe Touristique et Hoteliere RYI (a large hotel development) and in Industries Chimiques du Fluor, which will produce alumin- ium fluoride from local fluorspar for export. IFC's most recent investment, in May 1975, was in the Sousse-Nord integrated tourism development project. IFC's net commitments in Tunisia total $15.9 million. IFC's Board has ap- proved the sale of IFC shares in NPK to the Tunisian Government. 25. Since 1962 the Bank has chaired the Consultative Group for Tunisia bringing together the principal donor countries and institutions concerned with the country's development. The most recent meeting of the Group was held in Paris in June 1975. New participants in the Group included Saudi Arabia, Japan, the Arab Fund for Economic and Social Development and the Commission of the European Communities. PART III - THE POWER SECTOR Power and Energy Resources 26. Tunisia's main energy resources are oil, natural gas and a very small hydro power potential. Recoverable oil reserves are estimated at about 70 million tons. Annual oil production was about 4.6 million tons in 1975 and is expected to reach 6.5 million tons annually by 1980, as a result of additional output from new offshore fields in the Gulf of Gabes. Additional resources lie in an area of the continental shelf on which the frontier between Libya and Tunisia is currently in dispute. The two Governments have recently agreed to submit the dispute to the International Court of Justice in The Hague. 27. Some 300 million cubic meters of oil-associated gas can be trans- ported annually from El Borma to the Gabes area through a Bank-financed pipeline (Loan 724-TUtI) to supply a power station and various industries. The reinforcement of this pipeline to increase its capacity to about 500 million cubic meters annually by 1981 has recently been financed by the Kuwait Fund. Preliminary estimates of offshore natural gas reserves in the Gulf of Gabes are between 70 and 160 billion cubic meters. If the volume of gas reserves is confirmed and exploited, this could dramatically change the energy supply pattern in Tunisia, where the main benefits generated by the substitution of gas for oil would be incremental oil exports. Some 3.5 billion cubic meters of low-heat value gas from Sidi Behara and Sidi Agareb (20 miles west of Sfax) could be economically used for power generation. Tunisia's hydro-power potential is insignificant, but so far about 30 tIW has been developed. tNo favorable sites exist permitting further development except for a 25-MW power  - 9 - plant at Sidi Salem, which is part of the large multipurpose project (see para. 22) proposed for Bank financing, and a pumped storage plant at Kasseb which appears to be less economical and therefore has not been included in the development plan for energy. The Electric Power Sector 28. The power sector is mainly served by the Societe Tunisienne de 1'Electricite et du Gaz (STEC), a Government owned corporation, which is re- sponsible for the production, transmission and distribution of electricity and gas in Tunisia. Its principal activity is the sale of electricity; gas sales account for only 3.5 percent of its total revenues. In 1975 it supplied almost 90 percent of the electric energy consumed in the country, the remain- ing 10 percent being captive plant supplying individual industries. 29. In 1970, STEG's installed capacity was 215 tMu generating 680 GWh. In 1975 the equivalent figures were 367 MW and 1,204 GWh. Almost all of STEG's installed capacity is interconnected. The major thermal power plants are located in Tunis and Gabes. 14atural gas accounted for 59 percent, liquid fuel for 39 percent and hydro for 2 percent of STEG's power generation. The total installed capacity in hydro plants of about 30 tW is concentrated in the northern part of the country. STEG's total diesel capacity of about 15 1MN, of which the major part is installed in Sfax, Sousse and Robbana, has the role of standby capacity. The main transmission system, consisting of a 150 kV ring with 150 kV and 90 kV secondary branches, has a total length of about 1,400 km. The first 225 kV line of about 100 km was built in 1974 between Gannouche and Maknassy. It will be operated at 150-kV until 1977 when it will be extended to Tunis and converted to 225-kV. The medium voltage lines (10-30 kV) have a length of about 6,300 km, and low tension distribution lines and cables (220 V and 100 V) about 8,900 km. At the end of 1975 about 420,000 households (40 percent of the total) were provided with electricity, of which 35,000 were in rural areas (17 percent of total households in rural areas). Tariffs 30. As a result of a tariff study financed under Loan 815-TUtU, STEG implemented a new tariff system for electricy based on the marginal cost concept in April 1975, when electricity supply rates were raised an average of 16 percent. STEC is planning a second stage of tariff reform for 1978-1979, both with regard to tariff structures and to the level of electricity rates. At the same time STEG expects to bring tariff calculation systematically up to date on the basis of marginal costs. Government approval of STEG's tariffs is required. At present, oil prices (excluding motor fuels) in Tunisia are only about one fourth of international prices, enabling STEG to achieve satis- factory earnings without significant tariff increases. Assuming that export sales of petroleum products could be increased if domestic consumption were reduced, this policy results in a substantial subsidy to users of oil products and electricity. While the present price policy is part of a deliberate effort to promote industrialization, and the Bank has no evidence that it has caused an inefficient use of energy or distorted energy consumption patterns, it was agreed during negotiations that the Government would undertake an  - 10 - energy price policy study, with the assistance of consultants. The Government will submit the recommendations of the study to the Bank by September, 1978, and exchange views with the Bank on them (draft Guarantee Agreement, Section 3.04). STEG has also agreed to conduct a study of the level and application of connection charges in order to determine what effect its policy stipulating a rather high level of customer contributions has on the extension of service (draft Loan Agreement, Section 4.04). The Government's pricing study would take the results of this study into consideration. STEG's Development Program 31. STEG's 1977-81 development program, as included in the Government's draft Fifth Plan, amounts to TD 207.3 million (US$483.0 million) of which 90 percent will be for power, 1 percent for gas, and 9 percent for generaL development. To meet forecast electricity sales, which ar2 projected Lo rise by 88 percent in the next five years, the power program provides for a genera- tion component of TD 69.9 million (37.2 percent of the total power program). It consists of 290 MW of new capacity, of which 150 MIW is the gas turbine plant under the project presented in this report, and 140 Mfl is steam plant. The transmission component of the program is TD 36.8 million (19.7 percent of the total program). It involves the construction of 775 km of transmission lines, including a new 225-kV transmission grid to increase the reliability of the system. A continuing program of substation construction to meet increasing urban and industrial demand is also planned. The distribution component amounts to TD 80.5 million (43.1 percent) and is based on a master plan prepared with Canadian assistance, which sets up targets for the 1990 horizon. Its main aim for urban electrification is to keep pace with plans for housing construction and to ensure in the shortest possible time the connections for existing housing which at present is not supplied with electricity; the development of rural electrification is to improve the standard of living in rural areas and to meet the water pumping requirements for agriculture. The intermediate targets for 1981 are to supply 85 percent of households in towns and 57 percent in villages as against 62 and 17 percent, respectively, in 1974. The master plan, based on an analysis of forecast low-voltage consump- tion, appears to be adequate. A dispatch center for the power system, to be completed in 1981, is also included in STEG's construction program. 32. The gas component is a small portion of the development program al- though parts of it may have important implications for the future development of the power sector. It includes the reinforcement of the El Borma pipeline to enable gas to be used rather than flared and to supply new consumers, the distribution of gas in the Tunis area, connections for industrial consumers and, especially, studies for the offshore gas in the Gulf of Gabes. A deci- sion on the off-shore gas program would be taken by the Government at a later stage on the basis of studies now underway. A Bank mission visited Tunisia in November, 1976 to review the gas sector and possibilities for Bank assistance in defining a hydrocarbon policy in general and in formulating institutional arrangements for the development of the gas field and the training of person- nel. The planned introduction of natural gas on the Tunisian market would have an important impact on the industrial development of the country, providing  - 11 - opportunities for the development of industries based on the utilization of natural gas. For the power industry it would lead to the almost total sub- stitution of gas for liquid fuel in electricity generation. The direct impact on electricity consumption would be less significant, since it could be a substitute mainly for electric heating and cooking, accounting at present for only 0.7 percent of STEG's electricity sales. Preliminary estimates indicate that the total investment required to develop the offshore gas field would be around TD 330 million. The financing of this would be kept separate from STEG's development plan. 33. STEG's financing requirements for 1976 and the development plan period (1977-81), excluding potential offshore gas development, amount to TD 240.7 million ($561.1 million). STEG's internal cash generation including customer contributions would cover 51 percent of this amount. Only 44 percent of the financing would come from borrowing, of which 35 percent from new borrowing, all to finance foreign costs, and 9 percent from drawdown of exist- ing loans. The proposed Bank loan would finance about 2 percent of the con- struction requirements. Remaining foreign exchange requirements would be met through foreign government credits, bank loans and suppliers credits. PART IV - THE PROJECT History 34. The Bank has made two previous loans in the energy sector, totalling $19.5 million. Both were made to STEG. The first (724-TUN), a loan of $7.5 million was made in 1971 in conjunction with a $2.5 million loan from the Kuwait Fund for Arab Economic Development, to finance a gas pipeline. The second loan (815-TUN), of $12 million, was made in 1972 to finance a power project consisting of two 20-MW gas turbines, transmission and distribution system expansion, and consulting services for future plant and institutional development. The first project was satisfactorily completed in 1972 and in spite of technical difficulties connected with the compression and treatment plant, the audit rate of return on the project is about 72 percent, primarily due to higher oil prices. The second one is nearing satisfactory completion with both gas turbines as well as all transmission lines and substations in operation. 35. The proposed project was identified by a Bank mission which visited Tunisia in December 1975. Project preparation was carried out by STEG, and the project was appraised in June 1976. Negotiations took place in Washington in November 1976. The-Tunisian delegation was headed by the General Mtanager of STEG, Mr. Bahroun. A detailed description of the project is given in the report entitled "Appraisal of the Second Power Project (STEG) - Tunisia" (No. 1304b-TUN) dated December 7 1976, which is being distributed to the Executive Directors separately. A Loan and Project Summary is attached as Annex III, a Supplementary Project Data Sheet as Annex IV, and a map showing the location of project components is also attached.  - 12 - Objectives and Description of the Project 36. The proposed project is the gas-turbine component of STEG's 1977- 1981 development program for generating facilities. Its main objectives are (a) to ensure continuity of electricity supply; (b) to cover the need for peak power capacity; and (c) to allow STEG to implement its next expansion program with larger and more efficient steam turbine units than would be possible without the prior installation of gas turbine units as proposed in this project. Lending for the proposed project would also enable the Bank to continue the provision of technical assistance to STEG in connection with several studies which are important to the future development of STEG and the energy sector in Tunisia (paras. 30 and 44). Thus the Bank will continue its institution-building effort which started under the two previous loans and has led to improvements in STEG's organization and operations: decentralization of financial activities, improvements in the accounting and billing system, introduction of budgetary controls and internal audit, and revision of the tariff structure for electricity. The project would also provide the first occasion for private co-financing in Tunisia; in view of the country's important external resource requirements for the Fifth Plan, this is a sig- nificant development. 37. The project consists of seven gas turbines of about 20 MW each. The gas turbines would be heavy duty open-cycle units in their own housing so that they could in the future, if needed, be moved to other sites. Two each would be located in Sfax and Menzel-Bourguiba, and one each in Tunis South, Korba and Metlaoui. These sites are at the extremities of Tunisia's basic network, and are the centers in which actual and projected consumption is concentrated. The two units to be installed at Sfax would be operated with natural gas of low-heat value, recently discovered in the Sidi Agareb-Sidi Behara zone (about 20 miles west of Sfax). The others would be operated with gas oil pending conversion to natural gas should its feasibility be determined. Cost Estimates and Financing Plan 38. The total cost of the project (including 10 percent physical con- tingencies but excluding price contingencies since the cost is based on firm price bids (para. 40)) is $29.3 million with a foreign exchange component of $25.1 million. The proposed Bank loan of US$14.5 million equivalent would cover 58 percent of the foreign exchange cost of the project. The remaining foreign exchange cost would be met by S'FEG ($1.4 million) and by a consor- tium of private banks including the Societe Tunisienne de Banque and Banque Nationale de Paris, with the guarantee of COFACE (about $9.2 million equiva- lent-FF 46,000,000). The effectiveness of this loan would be a condition of effectiveness of the Bank loan (draft Loan Agreement, Section 7.01). No retroactive financing is proposed since any payments prior to Bank loan signature would be covered by STEG or by the consortium loan. All local currency costs would be financed by STEG.  - 13 - Project Execution 39. STEG would be responsible for project execution. The gas turbine units would be installed by the suppliers under a supply and erection contract. Civil works and supervision of the erection and of the required testing would be done by STEG's staff, which is competent and has undertaken similar work in the recent past, as for instance under the first Bank-financed power project. Procurement and Disbursement 40. Prior to appraisal STEG informed the Bank that in order to meet the demand for electricity, the award of contracts would be necessary before the proposed loan could be submitted to the Bank's Executive Directors but that STEG would follow the Bank's Guidelines for Procurement in all steps. Shortly after appraisal STEG awarded the contract, on the basis of international competitive bidding, to take advantage of the favorable price offered for a limited term by the lowest bidder (ALSTHOM of France). 41. Disbursements from the proposed Bank loan would cover a portion of the gas turbines and installation expenses. Disbursement of the proposed Bank loan is expected to start after the proceeds of the private bank loan have been fully withdrawn; on this basis it was agreed during negotiations that the Bank loan would be disbursed against 100 percent of foreign expenditures, up to $14.5 million, after the private bank loan and STEG's contribution had been drawn down. The project is expected to be completed by December 31, 1980. Environmental Impact 42. All five sites of the gas turbines are outside population centers, and the nearest habitations are situated about 2 miles away. Although the gas turbines will not create noise nuisances, the equipment would be provided with special hoods in order to reduce noise to a minimum level. The gas oil has a sulphur content of less than 1 percent, and the low-heat gas is sulphur- free. Thus the gas turbines would not cause any unacceptable atmospheric pollution. Management and Organization of STEG 43. Except for general control by the Government, STEG is an autonomous body, enjoying operational freedom in the conduct of its day-to-day business. The company's management is competent and effective. It is governed by a board of eight members headed by a full-time General Mianager; all board members are appointed by the President of the Republic. The operations of the entity come under the general supervision of eight departments. The country is divided into 13 Districts which operate the local services. A further decentralization is being studied by STEG, which would consist of the creation of local agencies in towns.  - 14 - 44. STEG's present organization appears to be adequate for the fulfill- ment of the company's tasks for the next plan period. Nevertheless its man- agement is studying the company's organization with the assistance of con- sultants. This action has been supported by studies under the second Bank loan which have been successfully completed. The introduction of offshore gas on the Tunisian market is expected to bring new responsibilities to STEG, concerning the construction and operation of onshore facilities for transmis- sion and distribution of natural gas. Therefore, a study would be undertaken by STEG, under terms of reference prepared in consultation with the Bank, to define these new responsibilities and to establish a new organizational structure for the company, its training needs and the required investments for the gas transport and distribution program; the recommendations of the study would be submitted to the Bank by June 30, 1978, and STEG would exchange views with the Bank on them by October 31, 1978 (draft Loan Agreement, Sections 4.04 and 4.07). Financial Position of STEG and Financial Covenants 45. Under Loan 815-TUN, STEG agreed to maintain tariffs at such a level that the ratio of operating surplus before depreciation to average value of gross fixed assets in operation less average customer contributions would not fall below 8.5 percent in any fiscal year beginning with 1973. STEG has met this covenant; its rate of return on this basis was 8.5 percent in 1973, 9.3 percent in 1974 and 10 percent in 1975. Partly because of the then existing uncertainties about asset values, and to reduce temporary fluctuations in the return that would arise from fluctuations in depreciation charges on account of commissioning of major assets, the rate of return was computed before depreciation. Since STEG's assets have now been identified and their values determined, it is no longer necessary to adhere to this covenant. During negotiations STEG thus agreed to adopt a more conventional rate of return covenant with an 8 percent rate of return on the net value of fixed assets in service beginning with 1977 (draft Loan Agreement, Section 5.04). STEG's rate of return on the new basis would be, with present electricity tariffs, about 8 percent in 1977. Marginal adjustments in tariffs would be necessary in subsequent years for STEG to continue earning an 8 percent return. 46. Loan 815-TUN also requires that STEG should not incur any debt without the approval of the Bank, except for financing the previous project, if it would raise the company's total debt to more than 45 percent of the sum of its equity and its total debt. Even after considering the large borrowings necessary for financing the total investment program, STEG's debt during the 1976-1981 period is not estimated to exceed the level of 45 percent except in 1979, 1980, and 1981, and then only marginally. The same covenant would thus be extended to the proposed loan (draft Loan Agreement, Section 5.05). It would keep STEG's assumption of long-term debt under review and, together with the proposed rate of return covenant, would ensure an adequate cash flow for STEG vis-a-vis its debt service and construction requirements.  - 15 - 47. Finally, under Loan 815-TUN, STEG's financial statements were to be audited and submitted to the Bank within four months after the end of each fiscal year. In the past, this time schedule has not been observed by STEG; the 1975 audited financial statements were satisfactory but were received only in August 1976. STEG attributes this delay to computer problems and to the fact that the auditors cannot start work until the annual report is available, generally in April. During negotiations, the Bank agreed to extend the period for submission of STEG's audited financial statements to five months after the end of each fiscal year (draft Loan Agreement, Section 5.02). However, in order to ensure that the rate of return covenant is met, STEG also agreed during negotiations that by October 31 of each year, it would prepare and submit to the Government and the Bank a forecast of operating revenues, operating expenses and the rate of return for the current and following year, a statement of the tariffs and assumptions underlying the forecasts, and a statement of measures proposed, if any, to meet the 8 percent rate of return (draft Loan Agreement, Section 5.04). Benefits and Justification 48. The growth rate of STEG's electricity sales since 1966 has been 11.5 percent per year and of system maximum demand 11.3 percent. The fore- cast adopted for system planning purposes implies an average growth rate of 13.3 percent for STEG's electricity sales and of 12.5 percent for maximum demand over the period 1975-1981. This forecast, which reflects the economic expansion of Tunisia planned for the next five year period, is considered a suitable basis on which to plan expansion of the power system. Two alter- natives were considered regarding the size of power generating units and the timing of their installation. The transmission program would remain the same under each alternative. The proposed program providing for the instal- lation of 150 MW of gas turbines through 1980 combined with two 140 tMW steam units at Sousse in 1981 and 1982 was found to have the lowest present value. 49. The estimated rate of return on the proposed project, at present electricity prices and using low-heat value gas for the Sfax power plant, and gas oil for the rest of the gas turbines, would be at least 13.2 percent. If offshore gas is used after 1980 instead of oil for all gas turbines (with the exception of the Sfax power plant which will continue to be operated on low- heat value gas), the rate of return would exceed 24 percent due to the lower economic value assumed for the offshore gas. The rate of return is highly sensitive to variations in fuel costs and electricity rates and less sensitive to increased capital costs. Project risks are no greater than can normally be expected with operations of this type. PART V - LEGAL INSTRUMENTS ANiD AUTHORITY 50. The draft Loan Agreement between the Bank and Societe Tunisienne de l'Electricite et du Gaz (STEG), the draft Guarantee Agreement between the Republic of Tunisia and the Bank, and the Report of the Committee provided  - 16 - for in Article III, Section 4(iii) of the Articles of Agreement and the text of a draft Resolution approving the proposed loan are being distributed separately to the Executive Directors. Features of particular interest in the Loan and Guarantee Agreements are discussed in paragraphs 30, 38, and 44. 51. An additional condition of effectiveness of the proposed Bank loan would be the effectiveness of the loan agreement between STEG and private banks providing foreign exchange financing for the project. 52. The draft Loan and Guarantee Ageements conform to the usual pattern for loans for Power Projects. 53. I am satisfied that the proposed loan would comply with the Articles of Agreement of the Bank. PART VI - RECOMMENDATION 54. I recommend that the Executive Directors approve the proposed loan. Robert S. McNamara President Attachments December 13, 1976  ANNE[l Tago-1 of 4 pages TABLE 3A TUNISIA, - SOCIAL INDICATORS DATA SHEET LANG AREA (THOU KNZI ---------- ------ -------- TUNI SIA REFERENCE COUNTRIES 119701 TOTAL 164.2 MOST RECENT AGRIC. 74.7 1960 1970 ESTIMATE JOROAN IRAQ ORECE*E GNP PER CAPITA IUSS) 230.0 380.0 760.0 350.0 590.0 1390.0 POPULATION AND VITAL STATISTICS _______________________________ POPIJLATION fMIO-YR. MILL InN) 4.1 5. 0 5.6 2.3 9.4 8.8 PnPULATION DENSITY PER SQUARE KM. 25.0 30.0 34.0 24.o 22.0 67.0 PEP SO. KM. AGPICULTURAL LAND 49.0 67.0 165.0 92.0 99.0 VITAL STATISTICS AVERAGE BIRTH) RATE I/THOU) 46.6 44.7 4o.0 47.5 49.1 18.1 AVERAGE DEATH RATF (/THOU) 21.5 16.9 13.8 17.8 17.9 9.0 INFANT MORTALITY RATF I/THOU) .. 125.0 .. .. 104.0 29.6 LIFE EXPECTANCY AT BIRTH IYRSI 46.1 51.6 54.1 50.7 50o2 10.9 GQOSS REPROOUCTION RATE 3.1 3.4 3.4 3.5 3.5 1.0 POPULATION GROWTH RATE IT) TOTAL 1-6* 2.1* 2.3* 3.1 3.2 05. URBAN *- 3-0 0 *- 6.0 1.5 URPAN POPULATION (T OF TOTALI 35.6 /a 40.1 b *- *- 58.0 62.6 AGF STRUCTURE (PERCENTI 0 Tn 14 YEARS 42.4 46.3 /b 44.6 47.0 /a 48.0 24.9 15 TO 64 YEARS 52.6 50.27i 51.2 49.5 7ii 48.0 64.0 65 YEARS ANO nVER 5.0 3.5/b 42 3.5 7 4.0 11.1 AGE DEPENDENCY RATTO 0.9 1.0/b 1.0 1.0 /a 1.1 0.6 ECnNOMIC DEPFNDENCY RATIO 1.3 /Bb 1.8ajb 1.7 /- 2.4 7i.b 1.8 /a FAMILY PLANNING ACCEPTORS (CUMULATIVE, THOU) .. 112.2 281.5 USERS IT nF MARRED WOMEN) .. 12.0 .. EMPLOYMENT TOTAL LABOR FORCE ITHOUSANO) 1400.0 A 1300.0 / 1600.0 350.0 /a 2700.0 LABOP FORCE IN AGRICULTURE (I) 69.0 7i 57.0 48.3 33.0 7; 52.0 JNFMPLnyEO (2 OF LABOR FlRCE) 10.0 7i 12.O0 b 9.5 14.0 7Z 6.0 INCOME DISTRIBUTION a nF DRIVATF INCOME REC D BY- HIGHEST 5 OF HOUSEHOLDS . .. .. HIGHFST 205 OF HOUSEHOLDS .. .. .. LOWEST 205 nF HOUSEHnLDS .. .. .. LPWEST 405 OF HQUJSEHOL'S .. .. .. 7ISTPIRUTION OF LAND OWNERSHIP . rWNEn RY TnP 1O0 nF OWNERS .. 53-0/d .. .. a ~WNEn RY SMALLEST IOT OJWNFRS .. . ..7.. HFALTH ANn NUTRITION PnPoLATION PER PHYSICIAN 10000.0 5950.0 5220.0/c 2680.0 3270.0 620.0 PIOPULATION PFR NURSING P RSCN .. 730.0/ 670.0 7 1050.0 5490.0 1140.0 P OPULAT ION PEP HOSPITAL RED 360.0: 410.0 420.0 960.0 520.0 160.0 PFP CAPITA SuPPLY OF - CALnRIFS (t OF REOUIREMENTSI 86. 0 -94.0f 94. 940 93.0 L16 0 PQROTIN (GRAMS PFO DAY) 54.0 63.0/Y 67.07 60.0 67.0 99.0 -OF WHICH ANIMAL ANn PULSE 13.0 14.0 *- 18.0 /c 17.0 /b 52.0 /b nFATH RATF I/THOU) AGES 1-4 .. 1.5h .. 5.0 EDI'CATION ADJUSTED FNROLLMENT RATI! PqIMARY SCHOOL 74.0 107.0 96.0/ 72.0 la 67.0 106.0 SECONOARY SCHOOL 12.0 20.O 6 20.0 7b. 33.0 77 24.0 66.0 YEARS OF SCHOOLING PPOVInFO0 IFIRST AND SECOND LEVEL) 13.0 13.0 13.0 12.0 12.0 12.0 VOCATInNAL ENROLLMENT I2 OF SECONDARY) 24.0 34.0 .. 3.0 /ae 3.0 20.0 ADULT LITERACY RATE S12 .. .. 55.0 .. 26.0 82.0 HOUS ING PERSONS PER ROOM (AVERAGE) .. 2.7 OCCUPIED DWELLINGS WITHOUJT PIPED WATER (1) 60.0/b ACCESS TO ELECTRICITY 12 OF ALL DWELLINGS) .. 24.0k .. RURAL DWELLINGS CONNECTEO TO ELECTRICITY (It) .. .. .. CONSUMPTION BAnDI RECEIVERS (PER THOU POP) 41.0 77.0 74.0/b 160.0 180.0 111.0 PASSENGER CARS (PER THOU POP) 11.0 13.0 18.0 7.0 7.0 26.0 ELECTRICITY IKWH/YR PER CAP) 84.o 155.0 226.0 72.0 291.0 1072. 0 NEWSPPINT (KG/YR PER CAP) 0.3 0.1 0.1 0.3 0.3 1.6 SEE__________NOTES_____________AND_________DEFINITIONS_________________________ON__________EVE_________SE____ SEE NOTES AND DEFINITIONS ON REVERSE  NOTES ANhEX I Page 2 of 4 pages Ulsotherise noted, data for 1960 refer to any year betwee 1959 and 1961, fan 1970 bet.sen 1968 ond 1970,..ad for Stoat Rennt fatint- bet-nee 1973 sod 1975. Don to eetgr-ttn, PoPo1Laito geotb note is lone than rate of nato-ltcrso 00..eecehabeeslcdasnobjeetloeno. tr,. o t.th%he basis of h.s slee of ice popolotton, oodit.. to r.n.a ~,goor -pbcne e tiatn and t,, sco..nny, .ho peetass abflciys Th T ll~ wtrepent to natil.s.l reorees,. maket Siee,agclsrL-sdsoucs c iti-n TUNISIA 1960 /n 1956, /b fato of papalatine ander 15 and 65 aod non to total labor forc; /c: 1963; Id 1962, bo -,ti;rro hos.pitals. 1970 In1956-66, /b 1966; In Rati.oef popolatiae ander 15 and 65 and -onr to tetal labor forc, Id oo inrig 4.2 .dIiln bhonare of priosto, bond., ..clding P. ilo ntrsi ball ouerhip, and 2.1 na1iton hentar- of nl laicebnd, In er-onne io sno-rneIet sernioss ony G. _oneno t hopsitaL -sisl-sb-tor Only, [A 1964-66; /b Ren1ioterd only, /t 12-16 yerst of age. MUST REGENT ESTIMT.kT: I Roct- Of popolstiaa ander 15 and 61 and .ne. to tetl labor forc lb 1972; /o 1971 /d P--cnonI lo goer-et -nrt-e only; /n Gonerneen t bo-yctl estebl tebo-ts; /f 1969-71 sn-rag, [ 12-18 unara of age- .bfoRDA 1970 I Last lank only; /b Ratio of popolati-n under 15 and 65 aind Ine to total labor force, Ic 1964-6b, /d 19i6, In lnclodlg UNRWA sobools. IRAQ 1970 / Ratio of popalation ander 15 ond 65 sod One to tota labor fore; /b 196b-66. bREtt 1970 /a Dun to eotg-atioo, fipepuLotl groth etef on 1eer thao rate Of e-turl c-oeas, Lb 1967. ill, Neneber 29, 1976 DEPFINGTIONS Of S712L INDIICATORS teod dA- (than 1052) oalto peou n osenn - PopuItotnur d-vdod 4, onainber of p~ c . ti- local - Total sarfao Stna neprioiof land see and ilansd -aters. ,n sale and feaegaIt uSee -tand'"rcrsfu ouu 'onec. - NoseI.. reeteatteate af aigriculturl anna aed ceop-na,ily er nod cuiaypranlat riignn.oIp_rnc potnIasetIy tee crps. p-t-crse -srie & bitches gs-dees On ce lie fal11 Poonlotleerbptlbd- Pouato edeidd by nlbe, of bhoputul beds voloble n publno and prin-te genera aol epen..alnood licoyctal LNP_norcapta /11_0uS) - UN? Per ospica eooenat ewr,,ent sarket pr,ices, and rshabllitatnon nceo eolnsnnuntg bones and entublloh,,iecto osloulsied by Seane IO-serobo anthod aso meld B-ek btlis (1973-75 basis); frneooladpeetv oe 196;), 1)70 sod 1975 dot.._.t P_s % i-.t -CM ,d1- .y squ-,ilnot of net foca sopplieu avao loble iu ouct-y per -apito per Peec1ocion and vealsanune day; on-ulble euppylte -oM-rse damStin psodnnt-e, unpurto leon rorolalon fod-yr.Alliso) - Osf Jo1y fi-e if not -ilaltaR , etnois., sod oIhuges in stock, oet Suppl-e auld.` anS a - fond, needs, aenraf of cia sad-yearsa nre. 1960, 1970 o-d 1975 data qa,,O 0? I enusd no food pe ucesoon an,d lo-nes in dLnstrlbatt-o;r- q-our -tset were esnunocd by FlO bused no phytiolo1-1a e-edo f-c Pop_luiton denuley -pee S5am kon - Mid-year papalatfan pee atse kiflo- enst-o slcity otObolbrndanip hnetrennntl-top-rt-no sienor (100hecarn) of tena aa.body On-ghte, og and s.. di,rbooc f popolucte, an,d ulincoing PPoe iaio den-ity-see 50-am Io:oSarf land - Gospoced aabone for lOS' for costs at, hns-hold ol-l. ogrtcoltnra land only. Per capIta supPly of -O ertn Ceroas pn day) - Proton cnteot of per oapito ont suipply of fcdpr day; ot "'pply or nod to defined as vobsatstc above; r-qo-roentot feer all tointrteo established by USriA Ucoon .. Grade birch rc pee-t.o.o d - Anaaa lien births Pee che.....d1 e od- Reso-rh Isr-l- ne--de for noci-on ulocc.f11.- rA g-ru of nt.ti year POPoaos nes-year aitticoel aen-ges ending is 196f and 1970. PteLnl cc dy. cot.' 0, to-,, -ttnc-l Pa,,s - i. ,e- adfloefea aerg oing In, 1975 for sea t -nooetstnae rm aite,Idn -1.1taclpio , .lo o...d.. I. aeltn,toUe trode d-as rat pe th.uad-. ocldsi ertes e i-erOf 75 grott of total proteno old 23 granoi of --Iaca Pr-t-nn coon -r- PoPultInIte-yara.t..t aeeg-a enoding is 1960 asd 1970, and oge for thne teld, propose.d by FA0 O tine Trintd World Pond S-rvy fso-y_ae average ening in 175 fcr nose e-et estimate. "e"stoOetesopi rn anialtd"`unio - Pro teto au-cply an "ed lefans -erclisy rate, (/cbgo - nnal taho of iefants andr oen yea of derived' fre oNieoe n 1ooe o t erdy age per theossad line biribo. ~~De.ot..2th