Senegal - Debi - Lampsar Irrigation Project

Report No. 1685a-SE Appraisal of the FILE COPY Debi-Lampsar Irrigation Project Senegal February 21, 1978 Agriculture Projects Department West Africa Regional Office FOR OFFICIAL USE ONLY Document of the World Bank 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 Worid Bank authorization.  CURRENCY EQUIVALENTS Currency Unit - CFAF US$1 - CFAF 245 CFAF 100 - US$0.408 CFAF 1,000,000 - US$4,080 'WEIGHTS AND MEASURES 1 hectare (ha) - 2.47 acres 1 kilometer (km) - 0.62 mile 1 ion - 2,204 pougds hm - million m ABBREVIATIONS ADF - African Development Fund BFA.O - Banque Centrale des Etats de l'Afrique de l'Ouest BNDS - Banque Nationale de Developpement du Senegal BOM - Bureau d'Organisation et Methodes CCCE - Caisse Centrale de Cooperation Economique (France) CPSP - Caisse de Perequation et de Stabilisation des Prix CEP - Centre des Etablissements Publics COF - Controle des Operations Financieres CUMA - Cooperative d'Utilisation du Materiel Agricole FAC - Fonds d'Aide et de Cooperation (France) IDA - International Development Association IBRD - International Bank for Reconstruction and Development INSRA/ISRA - Institut (National) Senegalais de Recherches Agricoles KF - Kuwait Fund MDRH - Ministere du Developpement Rural et des Ressources Hydrauliques ONCAD - Office National de Cooperation et d'Assistance pour le Developpement OMVS - Organisation pour la Mise en Valeur du Fleuve Senegal jAED - Societe d'Amenagement et d'Exploitation du Delta -SCET - Societe Centrale pour l'Equipement du Territoire - INTERNATIONAL International SOCAS - Societe de Conserves Alimentaires au Senegal SODEFITEX - Societe pour le Developpement des Fibres Textiles SODEVA - Societe de Developpement et de Vulgarisation Agricole SOMIVAC - Societe Mise en Valeur de la Casamance USAID - United States Agency for International Development (U.S.A.) CONVERSION RATES Paddy to Milled Rice - 65% Fresh Tomato to Tomato Paste - 18% FISCAL YEAR SAED July 1 - June 30 GOVERNMENT July 1 - June 30  rUE Urr.l-IAL ULt UrIL! SENEGAL APPRAISAL OF THE DEBI LAMPSAR IRRIGATION PROJECT TABLE OF CONTENTS Page No. SUMMARY AND CONCLUSIONS ...... ........................ i-iii I. INTRODUCTION ........ ................................. 1 Il. BACKGROUND ........ ................................... 2 General ..................................... . 2 J The Agricultural Sector ..... .................... 2 w' Institutions ....... .......................... 3 Development of the Senegal River Basin .... .... 4 The Senegal River Polders Project (Credit 350-SE) and Debi-Lampsar Engineering Credit (S-18-SE) ...................................... 6 The Senegal River Polders Project ............... 6 Physical Development ...... ................... 6 Cost and Financing ............................. 6 Procurement and Disbursements ................... 7 Accounts and Audit ....... ................... 7 Management, Staffing and Training ............... 7 Cost Recovery ................................... 7 Yields and Production ........................... 7 Economic Rate of Return ..... .................... 8 The Debi-Lampsar Engineering Credit ...8......... 8 Procurement and Disbursements ................ ... 8 III. PROJECT AREA ......................................... 9 General ......................................... 9 Topography ....... ....................... . 9 Climate and Soils ...... .................... . 9 Population ...................................... 9 Rural Income, Farm Size and Land Tenure ......... 9 Communications ...... ............................ 10 Farming Systems .................................. 10 Water Rights ...l................................. i This document has a restricted distribution and may be used by recipients only in the performance of their official duties. lts contents may not otherwise be disclosed without World Bank authorization.  Page No., IV. THE PROJECT .......................................... il General ......... ..................................... il Detailed Features .12 - The Debi Perimeter .12 - The Lampsar Perimeter ............................. 13 - Agricultural Development .13 Technical Assistance .14 Water Supply, Demand and Quality .14 Water Distribution and Management .15 Status of Engineering .15 - Engineering Design .15 - Construction Schedule .................... ......... 15 Environment and Health ...................... ......... 16 V. COST ESTIMATES AND FINANCIAL ARRANGEMENTS ... ......... 16 Cost Estimates ........................................ 16 Proposed Financing; ...........................8........ 18 Procure-ment .................. . 19 Disbursement .................. 19 Accounts and Audit .................. 20 VI. ORGANIZATION AND lKANAGEMENT .20 General .............................................. 20 Finance and Accounts .......................,.,. 21 Staffing .22 Training ........ ... 22 Project Monitoring and Evaluation .23 Cost and Rent Recovery .23 - Water Charges .23 - Mechanical Services .24 - Collection Ratio ..................... 24 VII. YIELDS AND PRODUCTION, MARKET PROSPECTS, PRICES, FARMERS' BENEFITS, SAED FINANCES AND GOVERNMENT REVENUES 24 Yields and Production .......................... 24 Market Prospects .25 Prices .25 Farmers' Benefits .26 Subsidies ............................................ 26 SAED Finances .................. ..................... 26 Impact on Government Revenues ........................ 27 VIII. BENEFITS AND JUSTI'FICATION .27 Risks .29 IX. AGREEMENTS REACHED AND RECOMMENDATION .29  ANNEXES Annex 1 Climatological Data Table 1 - Climatological Data - Richard Toll Table 2 - Climatological Data - St. Louis Annex 2 Soils Annex 3 Debi Irrigation Works Attachment - Irrigation Works, Characteristics Annex 4 Lampsar Irrigation Works Attachment - Irrigation Works, Characteristics Annex 5 Agriculture Table 1 - Crop Rotation, Field Occupation and Labor Requirements Table 2 - Hourly Costs of Mechanical Services Table 3 - Costs per ha of Mechanical Services, Number of Working Hours and Equipment Requirements Table 4 - Production Costs per ha Table 5 - Farm Budgets at Full Development and at Present Annex 6 Applied Research Annex 7 Water Supply and Water Requirements Table 1 - Crops, Net Water Requirements Annex 8 The Role of the Lampsar Channel in the Senegal Delta Water Supply Annex 9 Project Costs Table 1 - Total Project Cost Table 2 - Debi: Cost Estimate Table 3 - Debi: Expected Price Increases Table 4 - Debi: Costs of Irrigation Works Table 5 - Lampsar: Cost Estimate Table 6 - Lampsar: Expected Price Increases Table 7 - Lampsar: Cost of Irrigation Works Table 8 - Costs of Buildings Table 9 - Costs of Vehicles and Equipment Table 10 - Operation and Maintenance Costs Table 11 - Technical Assistance: Expected Price Increases Table 12, page 1 - Applied Research - Agronomy and Livestock Table 12, page 2 - Applied Research - Pedology and Drainage Annex 10 Project Financing Annex 11 Estimated Schedule of Disbursement Annex 12 Monitoring and Evaluation Annex 13 Financial Controller; Draft Terms of Reference Annex 14 Cost and Rent Recovery Indices  ANNEXES Annex 15 Market Prospects and Prices Table 1 - Rice Price Structure (1978 and 1985) Table 2 - Tomato Paste Price Structure (1978 and 1985) Annex 16 SAED Cash Flow (Project) Annex 17 Impact on Goverament Revenues Annex 18 Economic Analysis Table 1 - Increme,ntal Value of Production: Debi Table 2 - Incremental Value of Production: Lampsar Table 3 - Economic Costs and Returns Annex 19 Farm Labor Analysis Table 1 - Total Monthly Labor Requirements Table 2 - Econoinic Cost of Farm Labor Marginal Econom:ic Cost of Farm Labor (IBRD No. 17565) CHARTS Construction Schedule oi. Irrigation Works Project Impact on SAED Organization Typical Organization of a Perimeter MAPS Senegal River Basin, No. IBRD 3983R Delta Region, No. IBRD '3984R3 Debi Perimeter: Irrigation and Drainage Networks, No. IBRD 12863 Lampsar Perimeter: Irrigation and Drainage Networks, No, IBRD 12864  SENEGAL DEBI-LAMPSAR IRRIGATION PROJECT SUMMARY AND CONCLUSIONS i. Senegal's economy depends heavily on agriculture: but agricultural production is subject, as in other Sahelian countries, to high risks due to the erratic rainfall. Even in normal years, Senegal has to import substantial quantities of foodstuffs, of which rice accounts for some 180,000 tons annually. In order to reduce imports as well as the present reliance on rainfed agriculture, government is making strenuous efforts to develop the country's irrigation potential, primarily in the Senegal river basin. ii. The Senegal river basin is an international waterway, and "l'organi- sation pour la Mise en Valeur du Fleuve Senegal" (OMVS) was set up in 1972 by the three countries concerned, Senegal, Mali and Mauritania, to develop the river resources. UNDP recently approved a project to be executed by the Bank which would provide about 200 man-months of technical specialists to assist OMVS in its development strategy, coordination of regional investments and national projects, work schedules and training. The most important projects under consideration are the two large dams at Diama and Manantali. Final engineering for Diama, which would allow double cropping on 50,000 ha in the delta, is due to be completed early in 1978. Studies of Manantali are less advanced but it is expected that the dam would provide partial river regula- tion for navigation, for irrigation of about 380,000 ha, and also power for industry and mining. OMVS is carrying out a comprehensive review of the findings of the Diama and Manantali studies and of the other proposals (i.e., mining and navigation channel) for development of the river basin, so as to formulate a phased integrated program. iii. The proposed project would be the second to be undertaken in the river basin with Bank Group assistance, and would play a vital part in the development of this region. The first project, Senegal River Polders, financed under Credit 350-SE, is nearing completion and has been carried out satisfactorily. The Debi-Lampsar Engineering Credit S-18-SE, financed de- tailed engineering of the Debi and Lampsar perimeters (as well as the Diagambal perimeter which is under consideration for USAID financing). iv. The project would consist of (i) construction of irrigation works on 1,100 ha at Debi for paddy cultivation and on 2,220 ha at Lampsar for paddy (1,880 ha) and tomatoes (340 ha) under full water control including the necessary infrastructure facilities; (ii) agricultural development including allocation of 3 ha plots to some 1,100 farmers and provision to them of mechanical services, inputs, credit and marketing facilities; (iii) technical assistance to the Societe d'Amenagement et d'Equipement du Delta (SAED), which is responsible for development of the Senegal river delta  - ii - and valley, to strengthen its financial management, research and planning capabilities, and consulting services to assist SAED in carrying out studies for future development. v. Total project costs are estimated at US$35 million of which the foreign exchange component would be US$28.5 million or 8]%. Project costs exclude duties and taxes, from wiich the project is exempt. The cost of irrigation works is based on bids received following international compe- titive bidding, in accordance with IDA guidelines. The proposed IDA credit of US$20 million would finance 70% of the foreign exchange costs and 57% of total costs. It would include US$1 million for the refinancing of the Debi-Lampsar Engineering Credit, and US$19 million to finance the foreign exchange coats of the Lampsar, studies and applied research components, eqtLivalent to 80% of the total cost of these items. Senegal would receive further assistance in the form of a loan from the Kuwait Fund (KF) (US$5.3 million), and a grant from French Aid (FAC) (US$2.7 million). The Banque Nationale de Developpement du Senegal (BNDS) would finance agricultural inputs (US$1.2 million), and Govern-- ment would meet the remaining costs of the project (US$5.8 million). vi. Procurement for the Debi perimeter and for technical