Announcement of Nine Million US Dollars to Bolivia for Rural Development Project on February 19, 1976

.World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 BANK NEWS RELEASE NO. 76/14 February 19, 1976 $9.5 MILLION TO BOLIVIA FOR RURAL DEVELOPMENT PROJECT The World Bank has approved a $9.5 mfllfon loan for an Integrated rural development project. In the Altiplano In Bo1 fvla. The principal objective of this $12.8 mlllfon project Is to raise the standard of Jiving of subsistence fanners' famllles In the eastern part of the lngavl Province and the southern part of the Los Andes Province through hfgher Income and Improved health conditions. The main thrust of the project wlll be to Increase productivity of 4,000 project farmers and to provide complementary Infrastructure and social services for alt of the 10,000 rural families presently ltvfng In the project area. . The project components Include, among others, construction of 20 deep-we11 irrigation systems, purchase of 20 tractors, improved seeds, fertilizers, chemicals • for seed treatment, Insecticides, fungicides, and livestock. It also fnc1udes the construction of storage facflities, establishment of pastures, potable water and waste facilities, construction or Improvement of about 85 kilometers of all-weather gravel roads, health facilities and technical services. This project will be the first comprehensive effort to substantfa11y Improve traditional patterns of subsistence crop and livestock production among the small farmers of the Altlplano. The main efforts are directed toward group, of farmers rather than Individuals. This Integrated effort, building In traditional lines, is expected to achieve positive results. About 60,000 persons living In the project area wf 11 benefit from road Improvements; 48,000 fram health, potable water and waste facilities; and 24,000 from on-farm Investments and working capital. Disguised rural unemployment wl 1l be reduced and additional demand for supporting Jobs wll 1 be Increased. Annual Incremental production generated by the project Is estimated at about 14,400 tons of potatoes, 400 tons of qulnoa, 300 tons of vegetables, 3 ml I I Ion 1I ters of milk, 120 tons of beef and 20 tons of mutton~ It Is also expected that the project will have a beneficial envlronmental Impact, since the Introduction of fmp·roved land management practices Is likely to reduce soil erosion and drainage works will reduce the salinity problem In part of the project area. The loan made to Bolivia Is on Third Wlnda.,, terms, namely 25 years, Including 7 years of grace, and carrying Interest at 4•1/2 percent per annum. An additional 4 percent will be paid to the Bank by the Interest Subsidy Fund, representing the difference between the Bank's standard rate and the charge to the Borr<Mer • • Note: Money figures are expr.-ssed In U.S. donar equivalents. Fornt No. 1121 ·~. (9/75) ,), T E C H N I C A L DA T A PROJECT: fngavf Rural Developaent COUNTRY: Bell via TOTAL COST: $12.8 mllllon BANK FINANCING: $9.S mllllon, standard Third Window terms of 25 years, lncludlng 7 years of grace, with Interest at 4-1/2 percent per annum OTHER FINANCING: Government of Bolivia and beneficiaries IMPLEMENTING ORGANIZATION: Project· Unit located In the city of Vlacha: Untdad del Projecto·,. tngav.1 Mtnfsterfo de Asuntos, Campesinos y Agropecuarlos VI acha, Bo 11 v Ia PROJECT DESCRIPTION: The prlnclpa1 objective of the project Is to raise the standard of Jiving of subsistence farmers' families in the eastern part of the lngavl Prov·5nce and the southern part of the Los Andes Province through higher Income and improved health conditions. The main thrust of the project will be to Increase produc- tivity of 4,000 farmers and to provide ccmplementary infrastructure and socfa1 services for all of the 10,000 rural families presently living In the project area. The individual project components are th~ fo11owlng: a) irrigated Agrlcultural Development: I) construction of 20 deep-well irrigation systems; II) extension of ·a power line to operate the irrigation pumps~ iii) purchase of 20 tractors, Improved seed~ fertilizers, chemicals for seed treatment, ins.ecticides, fungicides, J.fvestock, handling and watering facilities, and Iv) establishment of pastures; b) Ralnfed ,.grlculture and Marketing Development: I) construction of storage facilities; Ii) purchaie of llvestock, Improved seed, fertilizers, chemicals for seed treatment, insecticides and fungicides, handllng and waterfng facllftles; and ill) establish= ment of pastures; c) Productive Support FaclHtfes and Social Infrastructure: i) construction or improvement of about 85 kllaneters of all•weather gravel roads; d) Health Facilities: i) construction, rehabilitation and equipping of six satellite health posts; ii) acquisition and utilization of mobile units for servicing health posts; Ill) rehabilftatfon and equipping of the Hospital of Vlache; and iv) training of personnel to staff the health posts; e) Potable Water and Waste Facllltles: I) provision :;f drinking water from about 4,000 wells (hand pumps) and construction of sanitation facllitles; and f) Technical Services: I) the operating expenses of the technlcal and administrative staff of the Project Unit; and ii) provision for. long-and .short-term specla11$ts for the Project Unit. PROCUREMENT: Most farm Inputs through normal commercf al channels. The 20 · tractors wlll be purchased In 2 groups of 10 each through local canpetitive bidding. The motors, pumps, casings and screens for the irrigation wells also will be grouped In lots of ten and purchased through International competitive bidding. The we 1is wiT f be- Insta I Ied by ·the Geo Iog Ic~ 1 Survey of Bo Ii v fa. The road work H 111 be done by the National Poad Service.· Construction of water distribution and drainage Z'/Stems will be a. undertaken by the Nat Iona I Commun I ty Deve 1opmen t Se rv Ice • CONSULTANTS: The Project Untt will employ four long-term specialists On project administration, groundwater Irrigation, and marketing credit), a water supply engineer, about five short-tenn speclaltsts (in agriculture, · machinery, adult literacy, dairy livestock, and crop/pasture), and a sociologist. ECONOMIC RATE OF RETURN: 15% ESTIMATED COMPLETION DATE: 1982