Announcement of Tanzania Receives Three IDA Credits for Agricultural Development on May 18, 1978

• ·FOR _I MMEOIALTE RELEASE· I ,) ·•world Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 IDA NEWS RELEASE NO. 78/69 MAY 18, 1978 TANZANIA RECEIVES THREE IDA CREDITS FOR AGRICULTURAL DEVELOPMENT About 1 .5 mill ion farmers in Tanzania wi11 benefit from three credits totaling $53.5 mi11 ion approved by the International Development Association (IDA), an affiliate of the World Bank. The first' credit of $12 million will help finance a rural development project in the regions of Mwanza and Shinyanga. Some 700,000 people are ex- pected to benefit directly from this project which aims at increasing the production of basic food crops, poultry and cattle in the project area. It will also support a forestry development program involving the establishment of fuelwood and pole plantations. • The International Fund for Agricultural Development (IFAD) is participating in financing this project with a loan of $12 mill ion. Both the IFAD loan, which will be administered by IDA, and the IDA credit will pay for about 81% of the $30.5 million total project costs. The balance will be met by the Government of Tanzania and villagers in the project area through the village self-help program with contributions of $4.8 million and $1.7 million, respectively. The second IDA credit of $27.5 mill ion wil1 help finance a project for cashew nut development. Under the project, three factories will be constructed and equipped to process about 30,000 tons of raw cashew nuts annually. It will also finance the expansion of cashew nut shell liquid storage facilities, the construc- tion of staff accommodations, and·facil ities for water and power supply. The main benefits of the project will be an increase of about $7 mil1 ion annually in Tanzania's net foreign exchange earnings by 1984 when the factories will have reached their maximum capacity. About 400,000 smallholder cashew nut producers are expected to benefit through better prices and increased production. t Some 3,000 employment opportunities will be created, including 2,000 for women • • NOTE: Money figures are expressed in U.S. do11ar equivalents.  • - 2 - The IDA credit of $27.5 mi l l ion wi l l finance 76% of the tota 1 project cost, estimated at $36.3 mi 11 ion. The balance wi 11 be contributed by. the Tanzanian Government and the country's National Bank of Corrrnerce. • The third IDA credit of $14 mi 1l ion wi l l help finance a project to improve tobacco handling in Tanzania. The project aims at increasing both the incomes of smallholder producers of tobacco and Tanzania's foreign exchange earnings by reducing the losses presently suffered during tobacco handling, marketing and storage. About 54,000 producer families, most of them with per capita Incomes be- low the absolute poverty level in Tanzania, are expected to benefit from this project. The credit will finance the supply to tobacco farmers of polythene bulking bags, construction of grading and baling centers, marketing centers, storage warehouses and ancillary facilities, and the supply of vehicles and related maintenance equipment. The total cost of the project is estimated at $20.~ mill ion. The IDA credit wi 11 finance 64% of the total project cost while the Government of Tanzania will provide the balance amounting to $6.7 mill ion. The three IDA credits are repayable in 50 years, including 10 years of grace, and carry no interest except for a service charge of 3/4 of 1% per annum • for administrative expenses. • l FORMN0.1121 (5-76) T E C HN I CAL DA T A • PROJECT: COUNTRY: TOTAL COST: Tobacco Handling United Republic of Tanzania $20. 7 mi 11 ion I DA FI NANC ING : $14 million, standard terms. OTHER FINANCING: The Tanzania Government, $6.7 million. IMPLEMENTING ORGANIZATION: The Tobacco Authority of Tanzania (TAT)~ P.O. Box 227, Morogoro 1 Tanzania. PROJECT DESCRIPTION: The project will, over a four-year period, aim to reduce the losses presently suffered by smallholder tobacco producers during tobacco handling. Specifically, the project will f1nance bulking bags, grading/ • baling centers, marketing centers, vehicles and related maintenance equipment, storage warehouses and ancillary facilities, and incremental staff and technical assistance for TAT. PROCUREMENT: Vehicles, spare parts, equipment and bulking bags financed under the project will be bulked as far as possible and pro- cured on the basis of international competitive bidding in accordance with Bank/lDA guide- lines. rn the evaluation of bids, qualified domestic manufacturers will be awarded a pre- ference of 15% or the existing rate of duty, whichever is lower. Procurement of goods and equipment which can not be bulked in packages of $100,000 or more will be in accordance with the government's competitive bidding procedures which are acceptable to IDA. Civil works contracts for the construction of market centers and storage facilities wi 11 be too small and scattered to attract international interest. CONSULTANTS: Consultants wi 11 he employed for the preparation of the Songea factory master plan, and to draw up designs for the grading/ baling centers, market centers and storage facilities. They will also be needed to design a financial and management accounting system for TAT, and assist TAT in the implementation of the system. • ECONOMIC RATE OF RETURN: 24% ESTIMATED COMPLETION DATE: 1983 - 0 - FORM NO. 1121 (5-76) T EC HN I CAL D A T A • PROJECT: Rural Development COUNTRY: United Republic of Tanzania TOTAL COST: $30. 5 mi 11 ion I DA FINANCING: $12 million, standard terms. OTHER FINANCING: The International Fund for Agricultural Development, $12 million; the Tanzania Government, $4.8 mill ion; and Village Contributions to the Village Self-Help Program~ $1.7 million. IMPLEMENTING ORGANIZATION: Regional Village Self-Help Programs (VSHP), Prime Minister's Office, P.O. Box 980, Dodoma, Tanzania. PROJECT DESCRIPTION: The project will constitute the initial five years of a long- term development program to improve the well-being of the rural populations of Mwanza and Shinyanga regions. It will supplement and complement on- going investment in these two regions, using the recently constituted villages as the • basic unit of investment. Specifically~ the project wi 11 include agricultural investments in proven agriculture technical packages, research, village verification trials, extension, 1 ivestock and forestry; financing for land-use planning; a village self-help program; road improvement investments; a water supply component; and funds for project coordination and monitoring/evaluation. PROCUREMENT: Contracts of $100,000 or more for purchase of vehicles and equipment will be awarded on the basis of international com- petitive bidding in accordance with Bank guidelines. Contracts of less than $100,000 for vehicles and equipment purchases will be awarded on the basis of normal government pro- cedures, which are satisfactory; such contracts will be limited to an aggregate of $1 million. Domestic manufacturers will be granted a preferential margin in bid evaluation equal to the prevailing tariff or 15% of the cost, insurance and freight of imports, whichever is lower. Civil works contracts totalling $100,000 or more will be awarded after international competitive bidding; in evaluating bids, domestic contractors will be allowed a 7.5% preference. As most of the project's civil works will involve small structures of varied design which are geographically scattered, it is recommended that, as appropriate, these be completed by a combination of local competitive bidding, force account and vJllage self-help. CONSULTANTS: n.a. ~ ECONOMIC RATE OF RETURN: 21% ESTIMATED COMPLETION DATE: 1984 - 0 - FORM NO. 1121 (~ -76) T ECHN I CA L D A T A • •, PROJECT: Second Cashewnut Development COUNTRY: United Repbulic of Tanzania TOT.A.L :osT: $36.3 million. I DA FI NANC I NG: $27.5 million, standard terms. OTHER FINANCING: The Tanzania Government, $6.6 million; and the National Bank of Commerce, $2.2 million. IMPLEMENTING ORGANIZATION: The Cashewnut Authority of Tanzania (CATA), P.O. Box 533, Matwara, Tanzania Cable Address: Korosho, Matwara PROJECT DESCRIPTION: The project will finance the construction and equipping of 3 faetorles with a total annual processing capacfty of 30,000 tons of raw nuts, the expansion of cashewnut shell liquid storage facilities, the construc- tion of staff accommodations and water and power supply facilities. It will also finance a cashewnut research program, an occupational health hazards study, and the provision of technical assistance for CATA. -- PROCUREMENT: Contracts for civil works, processing equipment, vehicles and for goods that can be bulked in amounts of $100,000 or more financed under the project will be procured on the basis of international competitive bidding in accordance with Bank/lDA guide.lines. In evaluating bids domestic civil works contractors will be ailowed 7.5% preference. Orders for goods less than $100,000 will be procured following existing government procedures which are satisfactory. Bids for major civil works have been awarded following international competitive bidding in accordance with Bank/lDA guidelines. The bids for processing equipment were invited following international competitive bidding and have been received and evaluated by CATA but no award has been made. CONSULTANTS: Consultants will be employed to implement the Management Information System designed under the First Cashewnut Development Project and to train CATA's finance and accounting staff. Consultants will also be needed for supervision of project construction. ECONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: 16% 1984 - 0 - •