Papua New Guinea - Enga Provincial Development Project

Document of The World Bank FILE COPY FOR OFFICIAL USE ONLY Report No. P-3242-PNG REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN AND CREDIT TO INDEPENDENT STATE OF PAPUA NEW GUINEA FOR THE ENGA PROVINCIAL DEVELOPMENT PROJECT March 18, 1982 This document has a restricted distribution and may be used by recipients only in the perfomce of their official duties. Its contents may not otherwise be discl_od wito World Bank autborion.  CURRENCY EQUIVALENTS Currency Unit - Kina (K) Kl US$1.50 US$l = K 0.67 WEIGHT$S AND MEASURES 1 kilogram (kg) - 2.20 pounds 1 metric ton (ton) - 2.205 pounds 1 kilometer (km) = 0.62 miles 1 square kilometer (sq km) - 100 ha 1 hectare (ha) = 2.47 acres GLOSSARY OF ABBREVIATIONS DWS - Department of Works and Supply HQPCC - Headquarters Project Coordinating Committee HQPCO - Headquarters ProJect Coordinating Officer LDP - Less Developed Province NPEP - National Public Expenditure Plan NPO - National Planning Office PC - Project Coordinator PI - Project Implementation division (NPO) PNG - Papua New Guinea PNGDB - PNG Development Bank SSC - Secretary's Staff Committee GOVERNMENT OF PAPUA NEW GUINEA FISCAL YEAR January 1 - December 31  FOR OFFICIAL USE ONLY PAPUA NEW GUINEA ENGA PROVINCIAL DEVELOPMENT PROJECT Loan/Credit and Project Summary Borrower: Papua New Guinea Beneficiary: Province of Enga Amount: Credit: US$2.0 million (SDR 1.7 million) Loan: US$6.0 million Total: US$8.0 million Terms: Credit: Standard Loan: For a period of 17 years, including a grace period of 4 years, with an interest of 11.60% p.a. Project Description: The proposed project would constitute the first four-year phase of the Government's eight-year plan to accelerate social and economic development in Enga province, which is one of the poorest in the country and where the way of life of the vast majority of its population has remained almost unchanged since neolithic times. The objective of the project is to strengthen the human, agricultural, institutional and physical resource base to enable the directly-productive and market-oriented activities to be carried out in the second phase of the plan. Specifically, the project would: (a) help maintain food production and improve nutrition by promoting growth in the subsistence system through the introduction of improved agricultural technologies and practices to farmers; (b) support low-cost income-generating activities, e.g., cash crops and small-scale enterprises; (c) improve provincial roads, facilities for health care, and govern- ment services; (d) increase the coverage of the formal and vocational education systems; (e) support community development activities to promote inter-clan cooperation, thus creating conditions conducive to development; and (f) strengthen the provincial government, local social services and the availability of trained manpower through technical assistance, training and local participation. Experience gained under the project will be applied in the design of similar development programs in other provinces. The main project risks are: (a) the likely delay in recruiting the professional staff required to help implement the project, owing to procedural problems and a general reluctance to work in such a remote area; (b) potential management and coordination problems because of the comprehensiveness of the project; and (c) the 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 - possibility of introducing culturally inappropriate practices. The recruitment risk would be minimized by the early recruitment of key project staff and the Government's newly introduced policy of paying an inducement allowance to public servants working in less developed areas. To ensure coordination of the various project components, a Project Coordinator has been appointed. Also, a social evaluator would be appointed to monitor the socioeconomic appropriateness of, and response of the population to, project activities. Estimated Cost: Local/a Foreign Total ---- ($ million) ---- Agricultural development 1.5 1.1 2.6 Infrastructure 1.5 1.9 3.4 Health services 1.0 1.1 2.1 Education 0.6 0.4 1.0 Community Development 0.2 0.2 0.4 Commercial assistance and training 0.4 0.3 0.7 Institution building 1.1 1.1 2.2 Base cost estimate 6.3 6.1 12.4 Physical contingencies 0.3 0.5 0.8 Expected price increases 1.4 1.4 2.8 Tocal Project Cost 8.0 8.0 16.0 Financing Plan: Local Foreign Tot-1 ($ million) --- World Bank Group - 8.0 t Government 8.0 - 8. Total 8.0 8.0 16.0 Estimated Bank Group FY: FY82 FY83 FY84 FY85 FY86 Disbursements: ---