Burundi - Third Ngozi Integrated Rural Development Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 3230-BU BURUNDI INTEGRATED RURAL DEVELOPMENT NGOZI III PROJECT STAFF APPRAISAL REPORT October 14, 1981 Eastern Africa Region Central Agriculture Division 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 Currency Unit - Burundi Franc (FBu) US$1.00 - FBu 90 FBu - US$0.011 WEIGHTS AND MEASURES Metric British/US Equivalents 1 meter (m) 3.3 feet 1 cubic meter (m ) 35.3 cubic feet 1 hectare (ha) = 100 ares 2.47 acres 1 kilometer (km) 2 0.62 mile 1 square kilometer (km ) 0.39 square mile (sq. mi.) 1 kilogram (kg) 2.20 pounds (lb) 1 liter (1) 0.26 US gallon (gal) 0.22 Imperial gallon (imp. gal.) 1 ton (metric ton) 2,204 pounds (lb) ABBREVIATIONS AND GLOSSARY BNDE - Banque National de Developpement Economique (National Economic Development Bank) BCC - Burundi Coffee Company COGERCO - Caisse de Gerance et de Reserve Cotonniere (Cotton Management and Reserve Fund) EPA - Ecole Professionnelle Agricole (Agricultural Vocational School) FAC - Fonds d'Aide et de Cooperation (French Aid and Cooperation Fund) FAO - Food and Agriculture Organization FECOBU - Federation des Cooperatives Populaires du Burundi (Burundi Federation of Peasants' Cooperatives) FED - Fonds Europeen de Developpement (European Development Fund) ICO - International Coffee Organization ILO - International Labor Organization ISABU - Institut des Sciences Agronomiques du Burundi (Burundi Institute of Agricultural Science) ITAB - Institut des Techniques Agricoles du Burundi (Burundi Institute of Agronomy) OCIBU - Office des Cultures Industrielles du Burundi (Burundi Industrial Crop Development Office) ONB - Office National du Bois (National Office for Wood and Wood Products) OTB - Office National du The (National Tea Office) RDC - Rural Development Company IFAD - International Fund for Agricultural Development * FISCAL YEAR Government of Burundi: January 1 - December 31  FOR OFFICIAL USE ONLY BURUNDI INTEGRATED RURAL DEVELOPMENT/NGOZI III PROJECT STAFF APPRAISAL REPORT TABLE OF CONTENTS Page No. I. BACKGROUND ................................................ 1 A. Project Background ...... ......................1....... B. Sector Background ...... ....................... 2 C. Government Services ...... ............................ 10 D. Development Problems and Government Plans ............ 14 II. THE FIRST TWO COFFEE IMPROVEMENT PROJECTS .... ............. 15 A. Burundi Arabica Coffee Improvement Project (Cr. 147-BU) 15 B. Second Coffee Improvement Project (Cr. 593-BU) ....... 17 III. PROJECT AREA ...................... ........................ 18 A. Location and Physical Characteristics .... ............ 18 B. Population, Land Use and Land Tenure ..... ............ 19 C. Socio-cultural Aspects ....... ........................ 20 D. Rural Institutions ........ ........................... 21 E. Production Systems, Marketing, Processing and Prices . 22 F. On-going Project Activities in the Project Area ...... 22 IV. THE PROJECT ................................ 23 A. General Description ................................ 23 B. Detailed Features ................................ 24 C. Project Costs ............. ................... 31 D. Financing ........ ........................ 32 E. Procurement .......... ...................... 33 F. Disbursements ............ .................... 34 G. Accounts and Audits ................................ 35 H. Environmental Impact ................................ 35 This Report is based on the findings of an IDA Appraisal Mission to Burundi in July-August 1980, composed of B. Mbida-Essama, J. C. Salle (IDA, Washington), C. F. Marshall and J. L. Unger (Consultants). N. R. Brouard (IDA) visited Burundi in September-October 1980 to review the erosion control and forestry components. J.-C. Salle held post-appraisal discussions in November-December 1980 with the participation of J. Chevallier (Resident Mission, Burundi). 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.  - ii - Page No. V. ORGANIZATION AND MANAGEMENT ....... 35 A. Organization and Staff ....... .............................. 35 B. Management of Project Components ... ................... 37 C. Project Implementation Schedule ...... ................ 39 D. Monitoring and Evaluation ............................ 40 VI. TECHNICAL AND PRODUCTION ASPECTS .......................... 41 VII. MARKETS AND PRICES ..............*........*................. 45 VIII. ECONOMIC BENEFITS AND JUSTIFICATION ....................... 47 IX. GOVERNMENT BENEFITS ......................................... 50 X. SUMMARY OF AGREEMENTS AND RECOMMENDATION ................... 51 SuRporting Tables and Charts Table 1 - Summary of Project Costs Table 2 - Estimated Disbursement Schedule Table 3 - Proposed Staffing Table 4 - Economic Analysis Table 5 - Government Cash Flow Table 5a - Regional Development Company: Cash Flow Table 6 - Project Implementation Schedule Table 7 - Project Preparation Facility Annex 1 - Annual Work Plan Annex 2 - Farm Cash Flow Chart 1 - Organization Chart of Ministry of Agriculture and Livestock Chart 2 - Organization Chart of Ministry of Rural Development Chart 3 - Organization Chart of the RDC MAPS Location of Project Area - IBRD 15322 Project Area - IBRD 15323 Coffee Growing Area - IBRD 15324 Material Available in Project File 1. Summary Project Cost Tables 2. Detailed Project Cost Tables 3. Coffee Marketing in Burundi 4. Foodcrop Development Program Details 5. Coffee Development Program Details 6. Pilot Swamp Development Program Details 7. Economic Analysis Assumptions: - Washing Stations - Foodcrop Development - Coffee Development 8. Annual Reports of OCIBU and BCC 9. Project Preparation Report by SOMEBU  BURUNDI INTEGRATED RURAL DEVELOPMENT/NGOZI III PROJECT I. BACKGROUND A. Project Background 1.01 The first Bank Group supported agricultural project in Burundi was a cDffee improvement project (Cr. 147-BU, 1969, para. 1.04), followed by a * second coffee improvement project (Cr. 593-BU, 1976, para. 1.04), both of them in the Ngozi Province, which produces about one third of Burundi's coffee. The project proposed for the third phase of the on-going coffee improvement program originated from discussions between RMEA supervision missions and the Office des Cultures Industrielles du Burundi (OCIBU) project staff as well as Govern- ment officials. It was prepared by Societe Mixte d'Etudes du Burundi (SOMEBU) with assistance from RMEA and reviewed by officials of the relevant ministries including representatives from the Ministries of Planning, Agriculture and Rural Development. In contrast to the first Ngozi Coffee Improvement Project and more in line with the on-going one, the proposed Project would not be limited to coffee improvement alone. It would be an integrated rural develop- ment Project seeking to improve the productivity of all the farmers' agricul- tural activities and to raise their general standard of living through the provision of social and economic infrastructure and facilities. 1.02 This report is based on the findings of an IDA appraisal mission which visited Burundi in July-August 1980, composed of B. Mbida-Essama, J.-C. Salle (IDA, Washington), C. F. Marshall and J. L. Unger (Consultants). N. R. Brouard (IDA) visited Burundi in September-October 1980 to review the erosion control and'forestry components. J.-C. Salle held post-appraisal discussions in November-December 1980, with the participation of J. Chevallier (Resident Mission, Burundi). 1.03 The major changes to the preparation report agreed upon during the appraisal were: (a) the reduction of the Project area from 15 to six communes for the foodcrop component because of the management and extension services- weakness and the high personnel turnover under the second coffee project; it was felt that these two problems could be solved only gradually; (b) a reduction in the number of Project components to be managed by the Project management team from about 14 to six to put more emphasis on the development of extension services and fewer burdens on the Project manage- rnent team; and (c) a substantial reduction in Project costs, as a consequence of (a) and (b) above. 1.04 This would be the sixth IDA credit to Burundi for an agricultural project. The first project was for coffee improvement (Cr. 147-BU) followed by a second coffee improvement project (Cr. 593-BU) in the same province. A fisheries project (Cr. 626-BU) financed by an IDA Credit of US$6 million and (:o-financed by the Abu Dhabi Fund for Arab Economic Development (US$1 million)  was approved in 1976. A forestry project (Cr. 918-BU) for an IDA Credit of US$4.3 million and co-financed by FAC (France, US$1.86 million), UNDP (US$0.70 million) and EEC Special Action Account (US$1.2 million), was approved in 1979. A rural development project for Central Burundi (Kirimiro), a region adjacent to Ngozi, was appraised in March-April 1980. Another rural develop- ment project is being prepared for Northeastern Burundi (Muyinga). Performance of the Ngozi projects is reviewed in Chapter II. The fisheries project implementation has been beset by delays in the recruitment of expatriate and local staff and by shortages of materials. Although the performance has improved, high staff turnover, insufficient production, weak management and lack of working capital remain serious constraints to efficient project implementation. The forestry project is proceeding well. B. Sector Background 1.05 Burundi, a small landlocked country in Central Eastern Africa, is bordered by Rwanda in the north, Zaire and Lake Tanganyika in the west and Tanzania in the south and east. The nearest major seaport, Dar es Salaam, is about 1,200 km away. Most imports come by rail from Dar es Salaam to Kigoma and thence by boat to Bujumbura. Exports follow the same route in reverse. The inefficiency of Tanzanian ports and railways is a major impediment t2 normal flow of goods t 2 and from Burundi. Total area is about 24,970 km excluding the 2,850 km of Lake Tanganyika that lie within Burundi territory. The population of nearly four and a half million, increasing at about 2% 2a year, gives Burundi one of the highest population densities (over 160/km ) in continental Africa. Bujumbura, with a pvpulation of about 175,000 is the only major urban center, and more than 90% of ths nopiilatin" live in the rural areas where population density varies from about 50/km to over 300/km . About 50% of the population is under 20 years old. Burundi is one of the 25 "least developed" nations iE. the world with per capita GNP estimated at US$140 in 1978. Real GNP growth o7?::r the past decade barely kept pace with inflation and the standard of living in the rural area may even have declined. Per capita income in the towns and cities is estimated to be four to five times that of rural areas. 1.06 Burundi has four major eco-climatic zones: (a) the Imbo, made up of a number of plains with altitudes of from just below 800 to 1,000 m, annual rainfall of 800 to 1,000 mm and average temperatures of 23