Cameroon - Northern Province Rural Development Project

Document of The World Bank ot A Apy FOR OFFICIAL USE ONLY Rejort No. 3031-CM CAMEROON NORTHERN PROVINCE RURAL DEVELOPMENT PROJECT STAFF APPRAISAL REPORT October 7, 1980 Regional Projects Department Western Africa Regional Office 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.  CURRENCY EQUIVALENTS -I Currency Unit = CFA franc (CFAF) US$1.00 = CFAF 210 CFAF 1,000 = US$4.76 WEIGHTS AND MEASURES 1 kilometer = 0.62 miles 1 square kilometer (km2) = 0.39 square miles I hectare = 2.47 acres 1 kilogram (kg) = 2.2 pounds 1 metric ton (t) = 2,205 pounds FISCAL YEAR Government: July 1 - June 30 SODECOTON: July 1 - June 30  FOR OFFICIAL USE ONLY ABBREVIATIONS CCCE Caisse Centrale de Coop6ration Economique (France) CFDT Compagnie Francaise pour le D6veloppement des Fibres Textiles CFJA Centre de Formation des Jeunes Agriculteurs CRF Centre de Recherche Forestibre CTFT Centre Technique Forestier Tropical DEP Direction des Etudes et Projets DGRST D6l6gation Gen6rale & la Recherche Scientifique et Technique DPNA Northern Province Delegate for Agriculture FAO Food and Agriculture Organization FNFP Fonds National Forestier et Piscicole FONADER Fonds National de Developpement Rural FSAR Fonds Sp6cial d'Actions Rurales FTDU Field Trials and Demonstration Unit GAM Groupement d'Agriculteurs Modernes GPN Governor of the Northern Province IRA-Nord Institut de Recherches Agricoles, Maroua IRCT Institut de Recherche sur le Coton et Fibres Textiles MEAVSB Mission d'Amenagement de la Vallee Superieure de la Benou6 MIDEVIV Mission de D6veloppement des Cultures Vivrieres, Maraicheres et Fruitiers MINAGRI Ministere de l'Agriculture MINEQ Ministere de l'Equipment MINEL Ministere de 1'Elevage MINEP Ministbre de l'Economie et du Plan NPED Northern Province Economic Division NSMP Northern Seed Multiplication Project OC Cereals Office ONCPB Office National de Commercialisation des Produits de Base PCAR Provincial Committee for Agricultural Research PCC Project Coordination Committee PMEU Project Monitoring and Evaluation Unit SCB SociWt6 Camerouaise de Banque SEMNORD Secteur Exp6rimental de Modernisation du Nord SEMRY Societe d'Expansion et de Modernisation de la Riziculture de Yagoua SGPN Secretaire General Province Nord SODECOTON Societ6 de D6veloppement du Coton du Cameroun ULV Ultra Low Volume USAID United States Agency for International Development This document has a restricted distribution and may be used by recipients only in the performance of | their official duties. Its contenst may not otherwise be disclosed without World Bank authorization.   CAMEROON NORTHERN PROVINCE RURAL DEVELOPMENT PROJECT Table of Contents Page I. BACKGROUND .............. ................................. 1 A. Project Origin ................................ I B. General Background .............................. . 1 C. Agriculture in the Economy ...... ........... . 2 D. Rural Development Policy ...... ...................... 3 E. Sectoral Institutions .............................. . 4 F. Bank Involvement in the Sector ..... .......... . 6 II. THE PROJECT AREA ......................................... 6 A. Physical Environment ........... 6 B. Population and Employment ........................... 8 C. Agricultural Activities ............................. 9 D. Agricultural Support Services ....................... 11 E. Previous and Ongoing Development Projects .... ....... 13 F. Planning and Coordination of Development .... ........ 14 III. THE PROJECT ............. ................................. 15 A. General Objectives .................................. 15 B. Summary Project Description ......................... 16 C. Detailed Features .................. ................. 18 IV. ORGANIZATION AND MANAGEMENT ...... ........................ 23 A. General Aspects ..................................... 23 B. Implementation ...................................... 25 C. Specific Features ................................... 26 V. COST ESTIMATES AND FINANCIAL ARRANGEMENTS ..... ........... 28 A. Project Costs .................... ................... 28 B. Proposed Financing ................. ................. 29 C. Procurement ..................... .................... 32 D. Disbursement .................... .................... 34 E. Accounts, Audit and Reporting Requirements .......... 35  - ii - Table of Contents - con't Page VI. AGRICULTURAL YIELDS, PRODUCTION AND FARMERS' BENEFITS .... 36 A. The Target Group .................................... 36 B. Technical Specifications ............................ 36 C. Adoption Rates .................... ................... 38 D. Yields ..................................................... 39 E. Project Production ...... ................. ............... . 39 F. Farmers' Benefits ........... .. .............................. . 40 VII. MARKETS, PRICES & FINANCIAL IMPLICATIONS FOR GOVERNMENT .. 40 A. Market Prospects for Exported and Locally- Marketed Crops ........ ............................ 40 B. International and Local Market Prices ............... 43 C. Marketing Constraints and Proposed Remedies ......... 44 D. Subsidies, Taxes and Financial Implications for Government .................................... 46 VIII. PROJECT BENEFITS, JUSTIFICATION AND RISKS...... .......... 47 A. Overall Impact ......... ............................. 47 B. Project Benefits and their Distribution ............. 48 C. Economic Analysis and Rates of Return ............... 49 D. Sensitivity Analysis ................ ...... . 51 E. Project Risks ......................... ............ . 51 IX. ASSURANCES, CONDITIONS AND RECOMMENDATION ................ 52  - iii - Table of Contents - con't TABLES IN THE MAIN TEXT Chapter Table 1: Summary of Project Costs V 2: Proposed Financing Plan V 3: Expected Adoption Rate by Farmers VI 4: Summary of Family Farm Budgets VI ANNEXES Annex 1 - Financial Tables Table 1: Government Cash Flow 2: Disbursement Schedule 3: SODECOTON - Analysis of Operational Results Annex 2 - Cost Tables Table 1: Annual Project Costs, by Component Annex 3 - Economic Tables Table 1: Summary of Economic Costs and Benefits 2: Price Structure for Cotton 3: Price Structure for Sorghum 4: Price Structure for Maize 5: Price Structure for Groundnuts Annex 4 - List of Reports and Working Papers in Project File Annex 5 - Proposed Management Responsibilities Annex 6 - Implementation Schedule CHARTS 21572 - Cameroon: Cotton Planting and Production (1951-1979) 21822 - Project Organization Chart MAPS 15025 Cameroon: Rural Development Projects 15026 Northern Province - administrative boundaries, isohyets and research sites 15027 Center North - population density and agro-ecological zones 15028 SODECOTON field organization and communications and infrastructure   CAMEROON NORTHERN PROVINCE RURAL DEVELOPMENT PROJECT I. BACKGROUND A. Project Origin 1.01 The Government of Cameroon has requested Bank assistance in financ- ing a Rur4l Development Project in the Northern Province, estimated to cost US$74.7 million over five years. The project would include strengthening of the institutional structure in the Province for the planning, monitoring and evaluation of development and for carrying out agricultural research; and, within a selected area (the Center-North), an agricultural development program reaching about 150,000 smallholder farmers growing cotton, groundnuts and foodcrops and including related reforestation activities and infrastruc- tural improvement. 1.02 The project originates from needs identified in the Bank's agricul- tural sector survey in 1974. Following a formal Government request for assistance in November 1976, a Bank identification mission visited Cameroon in May/June, 1977. The project was then prepared by the FAO/World Bank Coopera- tive Program which visited Cameroon twice, in October/November 1977, and in March 1978, when consultants from CFDT, financed under Technical Assis- tance Credit 673-CM, assisted in preparation of the agricultural produc- tion components of the project. Project preparation reports are listed at Annex IV. This report is based on the findings of an appraisal mission comprising Messrs. Ch. Redfern, R. Fishwick, M. Macklin, E. Pagacz and A. Rychener (Bank) and Messrs. R. Crofts and R. Wetherall (consultants) which visited Cameroon in November/December 1979. B. General Background 1.03 The United Republic of Cameroon is located on the Gulf of Guinea in Central Africa. It extends northward 1,200 km to the shores of Lake Chad and is bounded by Nigeria to the west, by Chad and the Central African Republic to the east and by Equatorial Guinea, Gabon and Congo to the south. Covering 475,000 km2, the country embraces a wide range of climatic condi- tions, from Sahelian in the extreme north to tropical rain forest in the south, permitting a well diversified agricultural sector and near self- sufficiency in food production. Although the country's reserves of petroleum are to be increasingly exploited, industrial development is still largely based on agriculture and forestry and involves domestic processing of primary commodities, such as cocoa and palm kernels, and the conversion of logs into lumber and wood pulp. Food processing industries account for 45%0 of total industrial turnover. 1.04 Infrastructure developments include improvement of the road network, particularly rural roads critical for the movement of agricultural produce,  - 2 - modernization of the Trans-Camerounais railway system, expansion of port facilities at Douala and plans for creation of a new port at Rocher du Loup (Wolf Rock) between Kribi and Campo. A major hydro-electric installation has been created on the Sanaga river at Edea and other dams are under construction on the Sanaga river and, in the North, on the Benoue river at Lagdo (para 2.23). 1.05 The population, estimated at 7.9 million in 1978, is currently growing at about 2.3