China - Guangxi Rural Credit Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. P-3763-CHA REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION ON A PROPOSED IDA CREDIT OF SDR 47.2 MILLION TO THE PEOPLE'S REPUBLIC OF CHINA FOR A RURAL CREDIT PROJECT April 5, 1984 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 Calendar 1983 January 1984 Currency Unit = Yuan (Y) A US$1.00 = Y 1.98 Y 2.04 Y 1.00 = US$0.51 US$ 0.49 The staff appraisal report is based on the exchange rate of US$1 = Y 2.00 prevailing at appraisal in September 1983. FISCAL YEAR January 1 to December 1 ACRONYMS ABC Agricultural Bank of China DCA Development Credit Agreement NMP Net Material Product PA Project Agreement PBC People's Bank of China RCC Rural Credit Cooperative  FOR OFFICIAL USE ONLY CHINA RURAL CREDIT PROJECT Credit and Project Summary Borrower: People's Republic of China Beneficiary: Agricultural Bank of China (ABC) Amount: SDR 47.2 million ($50 million equivalent) Terms: Standard Relending Terms: From Government to ABC: 20 years including 6 years of grace, with interest at 2.3% per annum. From ABC to subborrowers: Interest at prevailing rates, currently 5.04% per annum, with maturities and grace periods depending on subproject cash flows. Project Description: The project would provide funds to subborrowers in Guangxi Zhuang Autonomous Region to finance investments for the development of citrus orchards and other tree crops, aquaculture, livestock and agro-processing. Project funds would be channelled through the Agricultural Bank of China (ABC) to subborrowers comprising collective units (communes, production brigades and production teams), individual farmers and households, and state-owned enterprises. The project would also include a technical assistance component for the institutional strengthening of ABC, comprising overseas fellowships, local training, expert services for planiing an improved information and data management system, and future project preparation (12 man-months), and supporting equipment. A major objective of the project is strengthening the project appraisal capability and methodology of ABC. At full development the value of the aggregate incremental output from the project investments would be about $180 million per annum. The project would increase the production of higher value foods which are in short supply and for which demand is growing rapidly. Increased annual production would be about 430,000 tons of fruits and 11,000 tons of aquatic products, mainly fish. In addition, lending for the establishment or expansion of animal breeding and fish nurseries would help satisfy the growing demand from individual households for improved stock, while increasing the supply of red meat, poultry and 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 - eggs. The project would benefit directly some 90,000 families or 380,000 individuals. Satisfactory rates of return are expected. No major risks are anticipated. Subproject returns wouldi remain satisfactory even with significant increase in costs and reductions in revenues. The technological improvements envisaged are already widely in use in China. Estimated Cost: Local Foreign Total - $ million - Orchard and other tree crops 56.3 2.9 59.2 Aquaculture 21.8 1.9 23.7 Livestock 13.3 2.8 16.1 Agro-processing 5.2 3.4 8.6 Technical assistance 0.3 0.7 1.0 Base Cost /a 96.9 11.7 108.6 Physical contingency 9.7 1.2 10.9 Price contingency 20.5 2.4 22.9 Total /a 127.1 15.3 142.4 Financing Plan: Local Foreign Total ------ $ million ------ IDA 34.7 15.3 50.0 Government /b 20.0 - 20.0 ABC 30.0 - 30.0 Sub-borrowers 42.4 - 42.4 Total 127.1 15.3 142.4 Estimated Disbursements: IDA FY 1985 1986 1987 1988 1989