Announcement of World Bank Approves Loan to Tunisia for Rural Development Project on May 21, 1981

~ t . FOR IMMEDtATE RELEASE: · •World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 81/98 May 21, 1981 WORLD BANK APPROVES LOAN TO TUNISIA FOR RURAL DEVELOPMENT PROJECT The World Bank announr.~d today the approval of a $24 mill ion loan to Tunisia to help finance the first five y~ars of a 15-year development program for the country's Northwest region. The development program aims to increase the inc~mes and improve the health and educational level of the area's population, while reducing soil erosion, and thereby arresting the decline in agricultural productivity. The program is also expected to develop local energy resources, mainly fuelwood, and create job opportunities. The project area, with a total of 311,000 hectares, is composed of three • zones: one in the Kroumirie-Mogods mountain range, another to the southeast around the city of Beja, and a third zone east of the city of Le Kef. The project will benefit about 143,000 people, including small farmers and landless farm laborers, of whom 40% are presently below the absolute poverty level. The problem of soil erosion in the project area wil 1 be remedied by changes in cultivation practices such as the introduction of contour plowing, and the planting of pastures and forests. Rerorestation of some areas will have the added advantage of providing much-needed fuelwoocl. The soil conservation measures will be combined with an agricultural extension program based on the Training and Visit System; research on improved farming practices; and credit to farmers for the acquisition of farm equipment and machinery, livestock, draft animals, stables, and fruit trees. Livestock development will be fostered through the introduction of cross- bred stock, a breeding program, veterinary services, expanded forage planting, and the establishment of a milk collection and transport scheme. The program also includes the improvement of access roads, which are vital to the region's social and economic development. Some 320 kilometers (km) of inter-village roads, and 1,600 km of farm and forestry roads will be upgraded. Twelve primary schools and 40 water supply points for human and animal use will be p.rov i ded. • NOTE: Money figures are expressed in U.S. dollar equivalents. I ...  - 2 - Technica1 assistance wi 11 be supplied for training in the management of the various project components (credit, extension, and 1 ivestock services), and for studies of regional development in the entire Northwest region, rural development in central Tunisia, and a monitoring and evaluation system for the agricultural sector. • The $61.5 mill ion project will receive technical assistance valued at $1.7 million from the Federal Republic of Germany. The World Bank loan is repayable over 20 years, including a four-year grace period, and bears interest at 9.6% per annumo - 0 - •• • FOAM NO. 1121 (5-76) T E C HN I CA L DAT A • PROJECT: COUNTRY: TOTAL COST: Northwest Rural Development (Phase 1) Tunisia $61 .5 million BANK FINANCING: $24 mill ion, for 20 years, including 4 years of grace, with interest at 9.6% per annum OTHER FINANCING: German Government Technical Assistance, $1 .7 mill ion Government of Tunisia, $31 .5 mill ion Farmer's contributions, $4.3 mil 1 ion IMPLEMENTING ORGANIZATION: Office de Development Sylvo-Pastoral du Nord-Quest Mr. R. Harzal lah Ministry of Agriculture Rue Alain Savary Tunis, Tunisia PROJECT DESCRIPTION: The project includes: (a) soil conservation and forestry works on about 28,000 hectares; (b) a farm extension program based on the training and visit system; (c) production-oriented research in support of the extension program; (d) provision of short-, medium- and long-term • credit to farmers for inputs, farm equipment, equipment for small enterprises, live- stock, draft animals, fruit trees, and stables; (e) 1 ivestock development, including a breeding program, and animal sanitation and health centers; (f) introduction of forage crops, insta11ation of mi 11,. co11ection centers, and purchase of milk transport trucks; (f) infrastructure, including construction of roads, office buildings, schools and water supply points; (g) technical assistance for staff training and implementation of institutional reforms;and (h) studies of regional development for the Northwest reglon, rural development for the Central region, and for the establishment of an agricultural sector monitoring and evaluation system. PROCUREMENT: Equipment will be purchased using international competitive bidding (ICB) procedures in accordance with Bank guidelines for contracts of $100,000 and above (farm equipment, road building equ~pment, vehicles, and equipment for milk co1iection centers). Contracts for less than $100,000 will be awarded either: (a) on the basis of local competitive bidding (LCB) procedures of the Tunisian government which permit foreign participation, or (b) on the basis of local and international shopping with at least three price quotations from suppliers. Civil works will be procured on the basis of LCB, and wi 11 include headquarters office buildings, repair shops, extension centers, staff housing, milk collection centers, animal health facilities, and schools. Smaller contracts will be procured by directly negotiated contracts or by direct purchase from distributors. CONSULTANTS: The services of two technic2l assistance teams are foreseen as follows: for the Kroumirie-Mogods Subzone: 16 man-years of the services of an agronomist/chief of mission, a 1 ivestock expert, rural engineering • and civil works experts, credit/marketing experts, and land use planning and tenure experts, for the watershed area of Oved Zarga Oved Khil and Oved Tessa: 19 man-years of the same services 1 isted above, plus soil conservation and forestry experts. ECONOMIC RATE OF RETURN: 16% for the 15-year program ESTIMATED COMPLETION DATE: 1987 - 0 -