Mauritania - Second Livestock Project

Document of The World Bank FOR OFFICIAL USE ONLY Repot No. P-4215-MAU S REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDIT OF SDR 7.2 MILLION TO THE ISLAMIC REPUBLIC OF MAURITANIA FOR A SECOND LIVESTOCK PROJECT January 9, 1986 Thk documemant lm a resbicted diribuiesm a may be used by reciients only in the performace of their edal duti. Its cotents may not odewise be dclosed without World Bank anthorintion. CURRENCY EQUIVALENTS Currency Unit = Ouguiya (UM) US$1.00 - UM 80.00 UM 1,000 - US$12.50 SYSTEMS OF WEIGHTS AND MEASURES: METRIC I 1 Meter (m) - 3.28 feet 1 Kilogram (kg) = 2.20 pounds 1 Metric ton (mt) = 0.98 long ton 1 Hectare (ha) = 2.47 acres 1 Kilometer (km) 0.62 mile THE GOVERN'MENT OF MAURITANIA - FISCAL YEAR January I to December 31 ABBREVIATIONS AND ACRONYMS ACP Association Coopirative Pastorale (Pastoral Cooperative Association) AfDF African Development Fund BIE Bureau des Intrants pour I'Elevage (Livestock Input Distribution Unit) CBPP Contagious Bovine Pleuropneumonia CNERV Centre National d'Elevage et de Recherche Vitirinaire (National Livestock Research Center) CNRA National Center for Agricultural Research CT/MDR Office of Agricultural Statistics of the Ministry of Rural Development DNE Direction Nationale de 1'Elevage (Livestock Department) ENFVR Ecole Nationale de Formation et de Vulgarisation Rurale (National Training and Rural Extension School) FAO Food and Agriculture Organization of the United Nations FED Fonds Europden de DEveloppement (European Development Fund) FND Fonds National de Diveloppement (National Development Fund) IER Institut d'Economie Rurale (Rural Economy Institute) MDR Ministire du Diveloppement Rural (Ministry of Rural Development) OPEC Organization of Petroleum Exporting Countries PHARMARIf Soci6ti Mauritanienne de Commercialisation des Produits Pharmaceutiques (Mauritanian Pharmaceutical Marketing Company) SNIM Socifti Nationale Industrielle et Miniire (National Mining Industry Company) SOMECOB Soci4tA Hauritanienne de Commercialisation du Bitail (Mauritanian Livestock Marketing Company) SONADER SociftE Nationale de Diveloppement Rural (National Rural Development Agency) TLU Tropical Livestock Unit UNDP United Nations Development Programme FOR OFFICIAL USE ONLY ISLAMIC REPUBLIC OF MAURITANIA SECOND LIVESTOCK PROJECT CREDIT AND PROJECT SUMMARY Borrower: Government of the Islamic Republic of Mauritania. Beneficiaries: Livestock Owners forming Pastoral Cooperative Associations (PCA); Livestock Department (DNE); and Municipality of Nouakchott. Credit Amount: SDR 7.2 million (US$7.6 million equivalent). Terms: Standard. Relending Terms: Borrower to DNE as a grant. Project Objectives and Description: The proposed project seeks to slow the deterioration of the grazing areas and to boost productivity by making groups of pastoralists responsible for allocated grazing areas, by providing better services and production inputs, and by increasing the knowledge of livestock production systems essential to the formulation of a development policy and to the planning of future interventions. Main project components are: (a) a pilot component for the establishment of pastoral cooperative associations; (b) the study of livestock production systems, project monitoring and the preparation of projects; (c) distribution of production inputs for sale to livestock owners; (d) strengthening of livestock services; (e) establishment of a Livestock Fund and a production improvement fund; and (f) construction of a small abattoir in Nouakchott. Benefits and Risks: All project beneficiaries are livestock owners who would receive better public livestock services. Those livestock owners who form pastoral associations would benefit from the allocation of grazing rights, thus gaining an incentive and the possibility to introduce improved resource management. Better knowledge of production systems would facilitate the adoption of a coherent livestock development policy, and the cost recovery procedures would lead to a more efficient livestock service; both would eventually result in better resource management and higher productivity. The project entails considerable risks, however. The diminishing rainfall experienced in recent years could prove to be part of a secular downward trend, in which case the livestock subsector would have to be based on camel and goat production and on producer subsistence, as opposed to production for market. The pastoral This document has a restricted distribution and may be used by recipients only in the performance of their offcial duties. Its contents may not otherwise be disclosed without World Bank suthoriation. associations may not proliferate and resource management may therefore not be introduced. Livestock owners, who have considerable political power, may resist cost recovery, without which livestock services would remain at their present level of operation. These risks are judged acceptable, however, given that failure to intervene in the subsector entails the much higher risk of further deterioration in the subsector's potential and a continued decline in the rural standard of living. Estimated Project Costs (net of identifiable taxes and duties) a/: Local Foreign Total US$ millio Pastoral Cooperative Associations 0.2 1.1 1.3 Systems Studies and Monitoring 0.5 1.0 1.5 Distribution of Production Inputs 0.2 1.5 1.7 Livestock Services: Management 0.3 0.8 1.1 Animal Health 1.0 1.3 2.3 Animal Production 0.8 0.8 1.6 Training 0.3 0.8 1.1 Abattoir Construction 0.2 0.8 1.0 PPF Advance 0.5 0.5 Base Costs 3.5 8.6 12.1 Physical Contingencies 0.3 0.9 1.2 Price Contingencies 1.4 1.8 3.2 Implementation Delay Contingencies 1/ 0.8 0.8 1.6 Total Project Cost 6.0 12.1 18.1 Proposed Financing Plan IDA 2.3 5.3 7.6 AfDF 2.5 3.8 6.3 OPEC - 2.0 2.0 Government/Livestock Owners 1.2 1.0 2.2 TOTAL 6.0 12.1 18.1 a/ Amounts may not add up to totals due to rounding. 1/ Project costs based on a five-year implementation period with special contingencies for a two-year delay. Estimated Disbursement: FY87 FY88 FY89 FY90 FY91 FY92 FY93 US$ millin Annual 1.7 1.3 1.4 1.3 1.1 0.6 0.2 Cumulative 1.7 3.0 4.4 5.7 6.8 7.4 7.6 Economic Rate of Return: No rate of return has been calculated. However, the economic analysis shows that the incremental production required to obtain a satisfactory economic rate of return of no less than 10 percent is well within the bounds of prudent expectations. Staff Appraisal Report: No. 5720-MAU. Map: IBRD 18303 WAPAC January 9. 1986 INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDIT TO THE ISLAMIC REPUBLIC OF MAURITANIA FOR A SECOND LIVESTOCK PROJECT 1. I submit the following report and recommendation on a proposed Development Credit to the Islamic Republic of Mauritania for the equivalent of SDR 7.2 million (US$7.6 million) to help finance a Second Livestock Project. The Credit would be on standard IDA terms. Additional financing will be provided by the African Development Fund (AfDF) through a credit of US$6.3 million equivalent on terms identical to those of IDA and by the OPEC Fund through a loan of SDR 1.9 million equivalent (US$2.0 million) repayable over 17 years including 5 years of grace with a service charge of one percent per year. PART I - THE ECONOMY 2. A report entitled "Islamic Republic of Mauritania - Country Economic Memorandum (5537-MAU)", dated July 10, 1985, has been distributed to the Executive Directors. Updated country data are given in Annex I. The Land and its People 3. Mauritania bears many of the characteristics of the "Least Developed Countries" in terms of its physical and human resources, despite a per capita income of US$450 in 1984, which is somewhat higher than the ceiling for the lowest income countries. Three-quarters of the country is desert or semi-desert, the principal economic activities being livestock herding, mining and fisheries. Crop farming is generally limited to the sub-Saharan zone in the south, where rainfall is nonetheless sparse and irregular. Pockets of modern economic activity are found in the mining complex of Zouerate, the fishing center of Nouadhibou and the administrative capital of Nouakchott. These centers are geographically separated from the agricultural zones, and there is little economic interaction between them and the rural sector. 4. The three centers of modern economic activity account for a major share of the country's overall output, while livestock and crop farming, which support about two-thirds of the population, account on average for about 20 percent of total output. The mass of the population (total 1.7 million) suffers from an extremely low standard of living, as reflected in key social indicators: life expectancy at birth is estimated at 46 years, infant mortality is 136 per 1,000, only one in every three children of school-age attends primary school, and about only 18 percent of the population is literate in either of the two official languages, Arabic and French. -2- Past Economic Performance 5. Led by increases in iron ore production, Mauritania's Gross Domestic Product (GDP) sustained an average annual growth rate of 8 percent during the 1960s. The economy experienced a sharp deceleration in growth in the mid-1970s, however, and a period of marked financial instability in the latter part of the decade. Principal factors were reduced world demand for iron ore, on which the country had been dependent for 70-80 percent of its export earnings, .and the effects of severe and repeated drought on output in the rural sector. These factors were compounded by prolonged military conflict in the Western Sahara and a poorly conceived investment policy. The investment program was stepped up in the mid-1970s to rates approaching 40 percent of GDP with the support of heavy inflows of foreign assistance, particularly from OPEC sources and commercial lenders. These resources were used principally to finance the nationalization of the mining sector, ambitious projects in transport infrastructure and a few large industrial ventures which were to prove unviable. 6. In 1978 the Government undertook a stabilization program which called for the rescheduling of more than US$200 million in debt service obligations, tight controls over the Government expenditures and a reinforced tax effort. Increased iron ore and fish exports and higher crop and livestock production enabled the economy to pull out of the stagnation which had characterized it since 1977; real GDP growth over the 1979-81 period averaged 4.1 percent per annum. 7. The improved performance of the economy could not be sustained, however, in the face of a depressed world market for iron ore and the recurrence of severe drought. Iron ore production fell by more than 20 percent in 1982/83 to a level only 65 percent of that registered 10 years earlier. With rainfall only about 30 percent of normal levels in the 1983/84 and 1984/85 seasons, the livestock herd suffered major losses, and cereals production met less than 10 percent of total demand; aggregate output of the economy increased by only 1.4 percent p.a. from 1982 to 1984. In the absence of sustained growth, per capita average income in 1985 is essentially unchanged in real terms from that of a decade ago. 8. The public finance situation deteriorated substantially during the 1982-84 period. The Government's consolidated fiscal deficit rose from UM 1.7 billion (4.6 percent of GDP) in 1981 to a peak of UM 4.8 billion (11.2 percent of GDP) in 1983, before falling to UM 3.6 billion (7.8 percent of GDP) in 1984. A 9 percent increase in the size of the civil service in 1982/83 and high debt service payments contributed to the deficits. The deficits were financed out of Central Bank advances to the Treasury and through an accumulation of external and domestic payment arrears, estimated at about UM 5.5 billion by the end of 1984. 9. In the external sector, the growth of exports has been modest while imports have been high, mainly because of capital imports associated with major public investments. In 1983-84 the current account deficit was close to US$230 million on average, or more than 30 percent of GDP, as the investment ratio averaged 35 percent of GDP. Financing came mainly from external loans from Governments and multilateral institutions on concessional terms. -3- 10. Despite the high degree of concessionality, annual debt service obligations are well beyond Mauritania's payment capacity. Arrears on debt service have increased from US$23 million at the end of 1981 to an estimated US$103 million as of end 1984. Total scheduled payments on existing debt at that time implied a debt service averaging US$180 million over the 1986-1988 period without taking into account new borrowing after December 31, 1984. The Recovery Program and the Current Outlook 11. Mauritania's balance of payments and budgetary situation thus remains extremely weak, requiring continuing adjustment measures over the medium term and heavy support from abroad in the form of financial and technical assistance and food aid. The gradual depreciation of the ouguiya during 1984 was one of a series of recovery measures required to reduce external and domestic imbalances to sustainable levels and maximize the modest prospects for the economy in the medium-term. Further reform measures in the areas of exchange rate and price policy, fiscal administration, the public enterprise sector, the banking system and the public investment program are being pursued in the context of an Economic and Financial Recovery Program (1985-88) that the Mauritanian authorities approved in early September 1985 and presented to a Consultative Group meeting chaired by the Bank on November 26 and 27, 1985. In March 1985, the Government had already reached agreement with the IMF on a proposed Stand-By arrangement for SDR 12 million. In accordance with that agreement, it had undertaken in February 1985 a further 19 percent effective devaluation of the ouguiya in domestic currency terms, as well as increases in cereals prices at both producer and consumer levels ranging from 12-50 percent. The Government also raised all interest rates by two percentage points to levels which are positive in real terms and took measures to restrict credit expansion. The IMF Stand-By arrangement was also implemented, while negotiations with Arab and Western bilateral creditors to fill the projected 1985 financing gap of about US$200 million (including arrears) progressed satisfactorily. 12. Successful implementation of the Government's Economic and Financial Recovery Program, which includes priority macroeconomic and sectoral policy measures and a sound public investment program, should be supported by the international community because of its critical importance to the medium-term economic outlook. With disciplined economic management and well-conceived measures to exploit Mauritania's limited resources, modest but sustained growth in output is possible. Although international iron ore markets are not expected to recover significantly through the 1980s, it is possible to improve the cost effectiveness of mining operations. With World Bank assistance, the Government has embarked on a major rehabilitation of Sociftf Nationale Industrielle et Mini?re (SNIM), the parastatal company in charge of iron ore mining in Mauritania. SNIM's rehabilitation is an essential part of the Government's Recovery Program. Following this year's good rains, rural sector production is expected to recover from the drought-induced lows of 1984. In the livestock sector, the proposed project aims at helping the national herd after the heavy mortality and accelerated offtake of the past two years through better services and the provision of production inputs. In the medium-term, irrigation development will increasingly contribute to food supplies, even -4- though cereals production will remain highly vulnerable to the effects of drought. In the fisheries sector, now a major source of foreign exchange and budgetary revenue, growth could remain strong for another 3-4 years, but should then level off if resources are not to be over-exploited. Under favorable assumptions, overall growth of the economy through the remainder of the 1980s could average 3 percent annually, about the projected rate of population growth. PART II - BANK GROUP OPERATIONS IN MAITANIA 13. To date, the Bank Group has had 23 operations in Mauritania for a total of US$262.5 million. Of these, three are Bank loans for mining operations (US$66 million to MIFERMA in 1960, US$60 million to SNIM in 1979 for the Guelbs Iron Ore Project and US$20 million for SNIM's rehabilitation in 1985). The other 20 are IDA credits totalling US$116.5 million. Of the IDA operations, five have been in the transport sector, seven in the rural sector, two for education, two for technical assistance to economic planning and one for technical assistance to the Rural Sector, and there have been separate projects for urban and rural development, Public Enterprise Rehabilitation, Artisan and Industrial Development and petroleum exploration. In 1985, the IFC has financed a food oil refinery. The Bank Group's presence in Mauritania was fairly substantial in the early 1970s, and in 1970-72 it was the third largest donor providing about 18 percent of Mauritania's external capital assistance. Since then, external financial assistance to Mauritania from other sources has increased rapidly and the Bank Group's share in Mauritania's external capital assistance now amounts to about 8.0 percent. 14. Until the mid-1970s, Bank Group strategy for Mauritania focussed on traditional projects, mainly in agriculture, transport and education. This assistance has since been broadened to address the institutional weaknesses in country economic management, investment planning and project implementation. In 1978, the Association assisted the Government in designing a financial and economic rehabilitation program for which the first Technical Assistance Project (FY77) provided the expertise. Assistance for the formulation of macroeconomic policy, a medium- and long-term development strategy, and investment programs is being continued under a Second Technical Assistance Project (FY82), which is also helping to develop a pipeline of feasible investment projects. The objective of this assistance is to institute a much more thorough analysis of investments than in the past, especially to avoid large, capital-intensive projects with low productivity and unsatisfactory rates of return. Priority will now be given to projects involving the rehabilitation and maintenance of existing infrastructure, and only to those new investments that promise a high rate of return. 15. After a- comprehensive review of public sector enterprises financed under the first Technical Assistance project, assistance was also provided to the Interministerial Committee for the Rehabilitation of Public Enterprises in the course of preparing a medium-term rehabilitation program for the public enterprise sector. This program includes measures to increase the efficiency of existing enterprises through selective rehabilitation, privatization and liquidation, and also outlines -5- rehabilitation programs for several of these enterprises, including pricing policies, personnel adjustments, streamlining of management and appropriate maintenance of equipment. In support of this program, a Public Enterprise Technical Assistance and Rehabilitation Project was approved by the Board of Executive Directors in FY85. 16. In order to address Mauritania's severe balance of payments problems, tight fiscal situation and inability to service its public debt, the Association, in close cooperation with the IMP, helped the Government finalize a Recovery Program (1985-88) which was presented to a Consultative Group meeting held on November 26 and 27, 1985. To back up these efforts, our country and economic sector work, particularly concerning the banking, fisheries, education, energy and urban development sectors, has been intensified. To support the program more directly, a policy-based operation is envisaged for FY87 which will aim at improving economic management and promoting optimal use of domestic resources. 17. Professional training and technical assistance will remain an essential ingredient of IDA assistance to overcome the acute shortages of trained local staff at all levels, a major difficulty in project implementation. Through project aid and technical assistance, efforts have been made to strengthen farmers' training and vocational training for the modern industrial sector, as well as to broaden access to primary education. Nonetheless, pupils completing secondary and vocational schools with satisfactory results remain scarce; this partially explains the low productivity of employees in the modern sector. 18. Assistance to the education sector is being provided under the Second Education Project (FY82) which aims at expanding access to primary education, improving vocational training in the modern industrial and commercial sectors, and training lower secondary school teachers to replace a substantial number of foreign technical assistants. The Government recently requested that the Association assist its Education Reform Committee in reviewing key sectoral issues, defining long-term objectives, formulating policies, preparing an investment program to increase the efficiency of education and training, and reducing recurrent costs because of the already large share of education (30 percent) in the national budget. 19. Assistance to agriculture will continue since this sector is still considered Mauritania's principal source of long-term growth, despite its weak base and extreme vulnerability to drought, and high investment costs due to difficult physical conditions, limited transport infrastructure, and the high level of technical assistance needed. Through the Second Technical Assistance to the Rural Sector Project (FY83), rural institutions are being strengthened and incentives for efficiency developed by addressing such fundamental issues as input and product pricing, subsidies and land tenure. A Small Scale Irrigation project (FY85) continues IDA's assistance to the irrigation program by financing the establishment of 75 small perimeters of 20-25 ha each. The participation of beneficiaries in construction, maintenance and operation is being emphasized to minimize investment costs. The proposed Second Livestock project would improve livestock production, strengthen services and-based -6- on experience in Niger and Mali--establish pastoral cooperatives on a trial basis and allocate grazing rights to identifiable land areas. 20. In the energy sector, our assistance consists of supporting the Government's search for oil through the Petroleum Exploration Project (FY82), and carrying out an energy assessment in order to recommend strategies and policies for improving energy demand management, developing indigenous energy resources, strengthening institutions, and identifying areas for follow-up technical assistance that could form the basis for a future operation. 21. The Association is also helping Mauritania to develop an overall strategy for the urban sector. Urbanization has accelerated dramatically in recent years, but appropriate measures have not been taken to adjust to this development. Sector work is being carried out to gather detailed knowledge of urban requirements, and to examine wider urban policy issues in the overall context of Mauritania's development prospects. This sector work may lead to the design of an urban project at a later stage. 22. To assist in Mauritania's efforts to diversify employment and sources of income, financing was provided through the Mauritanian Development Bank (Credit 888-MAU) to encourage private enterprise and to promote artisanal carpet weaving activities. A Second Industrial Development project (Credit 1572-MAU) approved by the Board in FY85 is continuing support for these objectives by financing studies to develop appropriate policies for improving subsector performance and to assess the possibilities for further expansion of the manufacturing sector. 23. The Recovery Program for 1985-88 has identified fisheries and banking as two priority sectors where well-defined actions are urgently required to help the economy recover from its past record of low growth. To assist the Government in defining meaningful strategies in these two key sectors, the Bank has financed two studies which will provide the government and the donor community with a sound basis for defining basic studies and other policy actions. A first set of actions should be carried out in 1986. As it is the best source of growth in the short-term, the strategy objective in the fisheries sector will be to capture a larger share of the benefits currently reaped by foreign trawlers or contractors operating in Mauritanian waters. Once this sector strategy is in place, a fisheries project would be considered. 24. The banking sector is composed of six banks, four of which are fully controlled by the Central Bank. The sector has been suffering from a steady decline in its profitability (despite a continuous expansion of lending), obvious illiquidity, a tight cash position and risks that are out of proportion to the banks' potential. The capital and net worth of the banks have been progressively eroded because of accumulated deficits and bad debts, which are reaching the point where the future of the banks is jeopardized. The study, cofinanced with the Arab Monetary Fund, will provide an objective analysis of the means and actions required to restore the banks' financial viability, improve their management and change their system of credit control. The implementation of the rehabilitation program for the banking sector is obviously crucial for the promotion of all productive sectors. The Bank will consider providing some assistance for - 7 - this rehabilitation program as part of the policy-based operation envisaged for FY87. PART III - THE AGRICULTURAL SECTOR Overview 25. Two-thirds of Mauritania lies in the Saharan zone with less than 100 mm of annual rainfall; the rest is in the Sahel with a maximum precipi- tation of only 500 mm. Mauritania thus has one of the poorest agricultural resource bases in all of West Africa. The rural sector provides a livelihood for about 70 percent of the population and contributes about 25 percent of GDP, most of it from animal husbandry, which probably still provides a living to more than half the population. Sedentary agriculture is limited to a relatively narrow strip along the Senegal River. Insufficient and erratic rainfall, aggravated in the past decade by the recurrence of serious droughts, has been the major barrier to this sector's growth. Crop Cultivation 26. Along the Senegal and Gorgol rivers, farmers grow rainfed millet, flood-recession sorghum, and some vegetables. Yields are low due to the use of traditional cultivation techniques as well as irregular flooding and rainfall. Production of sorghum and millet in favorable years is about 40,000 tons, which satisfies only 15 percent of domestic cereal demand. Expansion or improvement of rainfed agriculture is technically, financially and economically non-viable and farmers will not risk investing where there is a substantial probability of loss due to drought. 27. Irrigation was not started until the 1960s and, by the end of 1984, about 5,000 ha had been developed, half being small perimeters of about 20 ha and the other half accounted for by three large projects, Mpourie (1,400 ha), Gorgol (600 ha) and Kaedi (700 ha). Production from irrigated perimeters represents less than 10 percent of the country's cereal consumption. It is estimated that by 1990, about 6,500 additional ha may be irrigated. The Livestock Subsector 28. Animal husbandry is only possible in Mauritania's southern regions, located on the northern fringes of the Sahel. These are the higher rainfall areas, but even ther! rainfall is relatively low and always erratic (at most 500 mm/year in some of the southernmost border areas) and recurrent droughts are even more pronounced than elsewhere in the Sahel. The traditional nomadic lifestyle persists, but considerable changes have taken place. Since the great Sahelian drought of 1973, precipitation has been below the annual mean. The 1983 and 1984 droughts were particularly severe. The inadequate rainfall has upset the system: livestock, unable to find enough grazing in the wet season pastures, now often stay all year in the dry season grazing areas that were formerly used for only four months, and some are even forced to proceed further south across the Senegal river into Mali and Senegal. This compresses the animal population into a -8- smaller area and increases competition for feed and land resources, not only amongst herders, but also between herders and settled farmers. 29. Shifts in herd ownership represent another element of change. Savings originating in the modern sector have long been invested in live- stock, where, in spite of inherent risks, they have earned attractive returns in the past. Investment in livestock is also a longstanding tradition. This trend toward absentee ownership and the construction of many public wells has undermined traditional ownership control over grazing in the areas served by public wells. Herds belonging to investors (mostly urban traders and Government officials), herded by hired personnel, increasingly roam grazing areas that were traditionally the preserve of pastoralists, thereby increasing pressure on the land. 30. There is uncertainty about the size of the national herd and its production parameters. Herd monitoring is made difficult by the herd's dispersion over a vast area, including remote and inaccessible regions, as well as constant cross-border movements. It is estimated that during the late 1970s and early 1980s the national herd amounted to some 1.2-1.4 million head of cattle, 7.5-8.0 million sheep and goats and around 750,000 camels, together equivalent to about 2.6 million TLU 1/ . Off-take rates are estimated at around 10 percent, 30 percent and 9 percent, respectively. Most production is consumed domestically, but with some surplus available for export. 31. The 1983 and 1984 droughts have changed the livestock subsector dramatically. Many cattle have died and many others have been driven into Mali and Senegal. The domestic herd is presently estimated at only 550,000 head of cattle, whereas the numbers of other species have probably decreased less since sheep, goats and camels tend to tolerate drought better. A tentative estimate would place their numbers as of late 1985 at 7.0 million sheep and goats and 700,000 camels, making the domestic herd equivalent to 1.9 million TLU. 32. The most important market is the domestic one, and is centered around the urban centers of Nouakchott and Nouadhibou, and the mining centers. Government is concerned about the country's meat supply. Present supply is still adequate because of ongoing destocking but shortages are likely when rainfall improves and restocking resumes. With continued population increase and the constraints on the growth of the Mauritanian livestock subsector, long term expectations are that domestic demand and prices will grow. Should domestic livestock production exceed domestic consumption needs, there would not be any export problem. A major objective of the project would therefore be to redress the present deterioration of resource management and increase productivity of the subsector. I/ One TLU (Tropical Livestock Unit) equals one head of cattle of 300 kg. In an average herd, this equals about: 1 camel, 0.73 head of cattle, and 0.12 sheep or goat. -9- The Institutions in the Livestock Subsector 33. The Ministry of Rural Development (MDR) is responsible for agriculture, livestock and the conservation of natural resources. It -administers five semi-autonomous public agencies: the National Center for Animal Husbandry and Veterinary Research (CNERV), the M'Pourie State Farm, the National School for Training and Extension (ENFVR), the National Center for Agricultural Research (CNRA), and the National Rural Development Agency (SONADER). The last two institutions deal exclusively with crop cultivation. There is also an autonomous state marketing enterprise (SOMECOB), for which responsibility is shared with the Ministry of Finance. MDR suffers from a shortage of qualified national staff at both the technical and policymaking levels. French technical assistance and an IDA-financed project (Technical Assistance to the Rural Sector) seek to alleviate the problem. 34. The Livestock Department (DNE) of MDR maintains its headquarters in Nouakchott and has 11 regional field centers in the regional capitals plus 19 veterinary field stations, most of which are located in the southernmost third of the country. The Department consists of a Division of Animal Health responsible for field services and the annual rinderpest vaccination campaign and a Division of Animal Production. Each regional center is staffed with a senior livestock technician who is responsible for supervising the field stations in his region and for planning and executing the annual vaccination campaign. Drugs are usually not available for budgetary reasons, however, and the conditions of infrastructure, the state of maintenance of the cold chain and vehicles, as well as inadequate and unmotivated staff make vaccination against the major diseases (rinderpest and pleuropneumonia) difficult. The proposed project would address this problem. 35. The ENFVR in Kaedi has been training veterinary field staff for over 20 years. It offers two levels of training: a three-year course for Livestock Assistants and a two-year course for Animal Health Assistants. Graduates from the school can easily be absorbed by the system, which is currently understaffed. ENFVR, in its training of animal health assistants, needs to give more emphasis to such practical matters as equipment maintenance in the field, communication with livestock owners, the sale of drugs and supplies, and the handling of money and simple accounting. 36. The autonomous state marketing enterprise, SOMECOB, was estab- lished in 1981 with an official but unenforceable monopoly over livestock exports and the authority to intervene in the marketplace, purchasing livestock for export with the secondary objective of stabilizing domestic prices. SOMECOB is also responsible for the Kaedi Abattoir, which was constructed in 1975 as an export slaughterhouse. SOECOB exports have been negligible because of a lack of competitiveness, and its inability to dominate the market and control private exports which take place freely and without obstruction. As a result, SOMECOB's purchases in the domestic market and, consequently, its price support effect have been insignificant. The Kaedi Abattoir is now functioning as a municipal slaughterhouse far below capacity. - 10 - 37. CNERV was established in 1973 to study animal diseases, do research on animal nutrition and conduct refresher courses for veterinary field staff. Due to limited budgetary allocations (it has an annual budget of UK 10 million of which 60 percent is for salaries), its activities are restricted to the Nouakchott area. The institute has a small but well trained staff, energetic leadership and receives technical assistance from France. Government's Objectives and Strategy 38. The Government gives high priority to rural development as the key to economic growth. The Government's main objectives for the rural sector are threefold: to increase food production, of both cereals and animal products; to protect and rehabilitate the environment; an6i to reverse the sharp increase in rural/urban migration. These objective. are sound, as is the proposed strategy of investing in projects with substantial beneficiary participation and with the lowest possible recurrent costs. Sector Issues 39. Three main issues affect the rural sector in Mauritania. First, institutions are weak due to the acute shortage of trained personnel. Second, investment costs are very high, due mainly to the difficult physical conditions, and to the use of costly expatriate manpower. This is particularly true for investments outside the main urban centers. Third, policies on prices and subsidies are urban-oriented, thus reducing production incentives. Such policies have been largely confined to cereals, however, and are being adjusted progressively. Producer prices in the livestock sector are determined by market forces, and efforts to influence producer prices through SOMECOB have failed (para 36). Bank Group Involvement in the Sector 40. The proposed project would be the Bank Group's eighth lending operation in the rural sector. The first seven operations were: a live- stock development project in FY72; a Drought Relief Fund project in FY73. under which IDA financed a small irrigation sub-project; the Gorgol Engineering project in FY74, which prepared the final engineering designs and tender documents for the Gorgol Irrigation Troject; a first Technical Assistance project to the rural sector in FY77; a small irrigation compo- nent under the Urban and Rural Development Fund project in FY79; the Gorgol Irrigation project in FY81; and a Second Technical Assistance project to the rural sector in FY84 and a Small Scale Irrigation project in FY85. Project performance audit reports have been issued for the first four operations. Common problems have included: (a) slow implementation due to administrative inefficiencies within the Government, itself a consequence of the acute shortage of trained local staff at all levels, although there was a notable improvement in SONADER under the first Technical Assistance project; - 11 - (b) cost overruns, partly due to slow implementation and exacer- bated by the exceptional political situation that prevailed up to 1979; (c) inadequate understanding of underlying sociological factors; and (d) difficulties in obtaining counterpart funds. The four projects have nevertheless achieved an aceptable degree of success. 41. The lessons learned from past experience have been taken into account in the design of the new projects. As far as the livestock subsector in particular is concerned, more time has been spent in preparing the project, better attention is being paid to staff training and a substantial amount of technical assistance is being provided to augment the country's limited executive capacity. Cost recovery is also being introduced to ensure the continued provision of inputs and services after disbursements have ceased. PART IV - THE PROJECT Background and the Bank Group's Role 42. The proposed project was identified in December 1979 by the Bank and was prepared in 1982 by consultants in cooperation with DNE. A Government request for funding was received in June 1983 and appraisal took place in October 1983. In February 1982, a first advance of US$250,000 was granted under the Project Preparation Facility (PPF). A second advance of US$165,000 was granted in August of 1984 for establishment of pastoral associations and preparation of the plan for a new abattoir and tendering. Negotiations took place in Washington October 15-17, 1985, with a Government delegation led by Mr. Mohamed Lemine Ould Deidah. 43. The slow pace of processing was a result of the introduction at appraisal of the concept of cost recovery based on charging for veterinary drugs, feeds, and mandatory vaccinations against Rinderpest and Contagious Bovine Pleuropneumonia (CBPP). The acceptance of the principle and agreement on the method of distribution and sale of supplies required extensive dialogue at both the technical and political levels. The third PPF advance of US$100,000 in June 1985 for the repair of vaccination crushes and for an extension campaign was in response to the Government's concerns that livestock owners might reject cost recovery if they saw no proof of better services being provided by the DNE. 44. The project is in line with the Bank Group strategy in Mauritania which aims at helping the Government to identify and exploit opportunities that can have maximm direct impact on employment and the income of the majority of the population. Animal husbandry has been a major source of income -:r the rural population. It is currently being threatened by the cumulative effects of drought, rangeland overstocking, and population pressure. However, the genetic adaptation of Mauritanian livestock to - 12 - harsh conditions and the knowledge and experience of traditional pastoralists in exploiting the range efficiently remain assets which can yet yield employment and incomes for a significant share of the population. 45. The project would introduce some innovations and reforms in the subsector. It would introduce cost recovery from beneficiaries thereby creating revenue for DNE and enabling it to finance its field operations. Pastoralist cooperative associations, launched as an experiment under the project for the supply and distribution of animal health and other inputs, would constitute an organizational structure for implementing improved range management techniques. The project also includes a new scheme for the distribution of livestock inputs through DNE field stations. All of these components present difficulties in the Mauritanian context and the Government is looking to the Bank for assistance in addressing these problems in an impartial and technically coherent way. Project Objectives and Description 46. The objectives of the project are to: (a) increase the knowledge and understanding of the livestock subsector; (b) slow the deterioration of pastures and increase herd productivity through the establishment of pastoral cooperative associations; (c) elaborate a development plan and prepare follow-on projects for the livestock subsector; (d) provide institutional and structural reforms, particularly with respect to the financing of livestock services; and (e) increase production by making improved services and produc- tion inputs available to livestock owners. 47. To achieve the above objectives, the project would have six components. First, it would provide assistance to the Government in estab- lishing 15 pastoral cooperative associations, as an experiment in social and territorial organization and with a view to achieving better management of renewable resources. Under a communal grazing system, no incentive exists to improve the grazing and water resources, since the individual or group making the investment is not assured of any benefit. Associations would be allocated rights to grazing land to induce them to improve their grazing and stockwater supplies and benefit from them. They would do this by establishing reserved areas which would be allowed to seed before being grazed and thus slow down surface water run-off. Pastoral cooperative associations would be granted legally enforceable grazing and stockwater rights, including the right to deny access to grazing areas which they wish to improve. These associations would qualify for assistance from the production improvement fund to be established under the project (see below). Second, the project would provide the necessary resources to obtain and analyze much-needed information regarding livestock production systems, draft a national livestock development policy addressing the - 13 - sector's fundamental problems, monitor the project and prepare follow-up projects. Third, it would provide technical assistance, equipment, initial start-up cost and a revolving fund to import, and sell to livestock owners the necessary veterinary drugs and vaccines, animal feeds, feed supplements and other production inputs at full cost. Fourth, it would strengthen public livestock services by rehabilitating infrastructure, providing equipment, training staff and building competence in the field of range and stockwater management. To assure adequate funding of field operations while not increasing the burden of recurrent costs on the national budget, the cost of public livestock services would be recovered through a surcharge on production inputs (including veterinary products) to be deposited in a Livestock Fund that would finance the costs of DNE field operations. Fifth, it would encourage self-help among groups of pastoralists by providing a Production Improvement Fund which would finance (on a grant basis) small rural works, firebreaks or activities for which pastoral groups themselves have mobilized at least 30 percent of the financing. Lastly, the project would provide partial funding for a simple, but hygienic abattoir for Nouakchott. 48. Pastoral Cooperative Associations. The 15 pastoral cooperative associations to be established under the project would be supplied with inputs and support services to help them become officially recognized producer groups with responsibility for their grazing and stockwater resources. During preparation of the project, a team consisting of a sociologist and a livestock specialist successfully created two associations on a trial, but non-operational, basis. Presently, under PPF financing, the same team is proceeding to establish other associations. The Government has agreed during negotiations that only bona fide cooperative associations formed by pastoralists would benefit from the well construction and rehabilitation program financed by the project. A pastoral cooperative association would initially consist of 30 to 50 households of livestock owners who traditionally have grazed and migrated together. The association would be assisted by DNE, which would provide: (a) animal health services; (b) stockwater and range management extension services; (c) veterinary drugs, animal feeds and other livestock supplies at full cost; and (d) training for officials of the associations and for selected members as veterinary lay assistants. For each association, the project would finance the repair of up to four wells and the construction of a new well under a contract to be entered into with the Water Affairs Department of the MDR. 49. Studies and Monitoring. A team of three national professionals would be assisted by an international specialist and, in cooperation with the Office of Agricultural Statistics of the Ministry of Rural Development (CT/MDR) and the CNERV, would provide a description of the existing livestock production systems and of the livestock subsector. The team - 14 - would then develop and submit for Government's consideration in year 3 a livestock development plan as well as proposals for follow-up projects. 50. Distribution and Sale of Production Inputs. Private firms and individual traders presently find it too costly to market veterinary drugs, feeds and feed supplements outside the regional capitals. The DNE, however, has an underemployed network of staffed veterinary stations in the field. Until such time as the private sector develops a capacity to supply inputs to livestock owners, the project would organize the sale of inputs from these outlets. By maintaining an adequate mark-up, the project is expected to encourage private sector participation in the market. This mark-up would be used to finance field operations of the DNE via a Livestock Fund. A special import fee on private imports of veterinary drugs would be deposited on a treasury account earmarked for the same purposes as the Livestock Fund. Government agreed during negotiations that: (a) there would be no restriction on private domestic trade in veterinary drugs and vaccines or animal feeds other than those pertaining to technical requirements and quality control; (b) BIE would charge, for all veterinary drugs and vaccines and all animal feeds, full cost c.i.f. at place of sale, plus a mark-up of at least 15 percent of retail sales price; (c) a special import fee would be collected from private importers of veterinary drugs amounting to 9 percent of the invoiced cost of the imported items; and (d) the mark-up would be deposited in a Livestock Fund and the special import fee in an earmarked treasury account, the proceeds of both of which are to be used to fund field operations of DNE against a budget to be agreed upon by IDA. 51. Strengthening of Livestock Services. The DNE has 30 regional and district veterinary stations. The project would: (a) establish a system of cost recovery which would in time assure adequate funding of the field services and such funding would be provided by the proceeds of the surcharge on prices or that of the import fee in those cases where the private sector substitutes for BIE; (b) complete, rehabilitate and modify the field infrastructure; (c) upgrade the staff through refresher courses and more prac- tical training; (d) provide additional equipment and vehicles for field stations; and (e) improve DNE's financial management. - 15 - 52. A Range Management Section would be created in DNE's division of animal production. A Stockwater Section would similarly be created in the division of animal production and would be staffed by the two livestock technicians trained in stockwater conservation and development. These two sections would extend advice and assistance to the pastoral associations. Their creation would be a condition of effectiveness. 53. In order to improve training of both existing and new staff and to create facilities for the training of the officials of the pastoral associations, the project would: (a) improve the existing pre-service training program; (b) develop a capacity to conduct programs of in-service training and upgrading for department staff; (c) initiate training programs for the officials and members selected as veterinary lay assistants of the pastoral cooperative associations; and (d) provide mass-media support for livestock extension. 54. An internationally recruited Project Coordinator/Financial Controller would be provided for five years. He would be in charge of project coordination and be a financial adviser to the project director (para 63). 55. Production Improvement Fund. This fund would be established in the DNE to finance partly, on a grant basis, small rural works, interven- tions or activities for which groups of livestock owners would be willing and able to provide at least 10 percent of the cost in cash and 20 percent in cash or kind. The Government agreed during negotiations that the Production Improvement Fund would only be used for investments not exceeding UM 2 million per project to rehabilitate existing infrastructure of pastoral cooperative associations or, exceptionally and with the approval of IDA, of well established groups of traditional pastoralists with no access to other kinds of development funds. 56. The Nouakchott Abattoir. The District of Nouakchott wishes to replace the existing unsanitary slaughterhouse with a simple but hygienic abattoir. The project would finance the construction, equipment and working capital of this abattoir in Nouakchott. The Government has agreed during negotiations that the abattoir would be operated on a commercial basis and would charge fees allowing full cost recovery, including amortization. Project Costs and Financing 57. Total project costs, net of taxes and import duties which would be waived, but including contingencies, are estimated at UM 1,446 million, equivalent to US$18.1 million, of which 67 percent would be foreign exchange. The project is conceived as a 5-year project, but costs include a provision for a possible delay in implementation based on a 7-year disbursement profile (see Summary, page iii). The implementation delay - 16 - contingency amounts to UM 128 million (US$1.6 million). Base costs have been set at October 1985; they have been established by adjusting prices obtained in February 1985 with the actual rates of increase in foreign and local costs (5 percent and 12 percent per year, respectively). Physical contingencies of 10 percent have been added to the cost of all goods and services, except for civil works (15 percent). Price contingencies have been calculated at the following annual rates: Price Contingencies Used on Project Costs (in percent) 1986 1987-1992 Foreign costs 7.5 8.0 Local costs 12.0 10.0 58. IDA would finance stockwater development (except technical assistance) for the pastoral cooperative associations, technical assistance and consultants for management, training, studies, and input distribution, and 50 percent of externally financed incremental operating costs. Funds advanced under the PPF facility would be reimbursed from the proceeds of the IDA credit. IDA's participation in the project would be US$7.6 million (42 percent of project cost), 70.0 percent of which would be for foreign exchange costs. The African Development Fund (AfDF) has agreed to participate with a loan amounting to US$6.3 million equivalent, on terms identical to those of IDA. The OPEC Fund has also agreed to participate in financing the project with a loan of US$2.0 million to be reimbursed in 17 years, with no interest but a service charge of 1 percent. The effectiveness of. the IDA credit would be subject to effectiveness of the AfDF and OPEC financing. Together, foreign sources would finance 88 percent of total project cost. The Fonds National de Dfveloppement (FND) would contribute UM 40 million (US$500,000) and the District of Nouakchott would contribute UK 3.2 million (US$40,000). Beneficiaries are expected to contribute US$1.2 million and the Government the equivalent of US$453,000. Together, domestic sources would finance the equivalent of US$2.2 million or 12 percent of project costs. Project costs would include US$2.1 million of externally financed recurrent cost (11 percent of project cost). This is essential because of budgetary constraints. However, recurrent cost financing by external sources would be on a declining scale for input distribution and for the animal health and production components, for which operating costs would increasingly be financed through cost recovery. Procurement 59. Stockwater development for the pastoral cooperative associations would be executed by the Hydrology Department of MDR under a contract to be concluded with DNE. The Hydrology Department would use its own equipment and personnel to the extent possible. The proposed credit would provide necessary equipment that is not available and finance materials and the incremental operating costs. The Hydrology Department may also sub-contract part of the works. 60. The IDA-financed goods and works for this component would be grouped in homogeneous bidding packages where feasible and the following procurement procedures would apply. Contracts of US$100,000 or more would - 17 - be subject to international competitive bidding. Contracts exceeding US$50,000 but less than US$100,000 would be awarded under limited inter- national bidding procedures acceptable to the Association. Contracts under US$50,000 would be awarded according to local competitive procedures which have been reviewed and found acceptable to the Association. Consultants and technical assistance financed by IDA would be procured in accordance with the Guidelines for the Use of Consultants by World Bank Borrowers and by the World Bank as Executing Agency. The terms of reference and qualifications of all consultants and technical assistants would be subject to IDA agreement. Procurement arrangements are summarized in the table below, with the figures in parenthesis showing amounts to be financed by IDA. Non-IDA financed goods and services would be procured according to -he rules of AfDF and OPEC respectively on a parallel basis, except operating cost, which will be jointly financed by IDA and AfDF (50 percent each). Since it cannot be determined at this time for what purposes the implementation delay contingency will be used, it has been listed under N.A. For expenditure other than operating costs, the procedures described above will apply. Procurement Arrangements a/ (US$ million) Procurement Method Total Item to be procured ICB LCB Other N.A. Cost Civil Works 2.5 0.1 - - 2.6 Stock Water Development 0.4 - 0.1 1.0 1.5 (0.4) - (0.1) (1.0) (1.5) Equipment and Vehicles 1.5 - - - 1.5 Consultants, Studies and T.A. - - 4.2 - 4.2 - - (3.0) - (3.0) Inputs 1.6 - - - 1.6 Production Improvement Fund - - 0.9 - 0.9 Scholarship - - 0.4 0.4 Operating Costs - - 3.3 3.3 - - (1.0) (1.0) Repayment PPF - - 0.5 0.5 - - (0.5) (0.5) Implementation Delay Cont. - - - 1.6 1.6 - - (1.6) (1.6) 6.0 0.1 5.2 6.8 18.1 a/ Amounts in brackets are financed by the IDA credit. N.A. - Not applicable. Disbursement 61. Disbursement of the IDA credit would be against the categories of expenditure and within the limits shown below: - 18 - Disbursement Schedule for IDA Credit Categories Amount 2 of Total (US million) Expenditures a) Civil Works a/ 1.5 100% b) Consultants and Technical Assistance 3.0 100% c) Incremental Operating Costs 1.0 50% d) Refinancing PPF 0.5 100% e) Unallocated 1.6 - 7.6 a/ Stockwater for pastoral associations. 62. In order to facilitate the pre-financing of project expenditure, a Special Account of US$200,000 representing about 3 months of project expenditures, would be established from the proceeds of the IDA credit. The Special Account shall be operated under the joint signature of the Director of Livestock and the Project Coordinator/Financial Controller. Similarly, a Special Account would be established out of AfDF loan proceeds to pre-finance AfDF - financed project costs. Project Organization and Management 63. DNE would be responsible for project execution. The project would not have a separate structure, but would be incorporated into DNE with the Director of Livestock as project director. The DNE is well managed and able to carry out the project. Each component would be executed either by the Animal Health or by the Animal Production Division, both of which are part of DNE. In the case of new activities not covered by an existing organization (e.g., systems studies and monitoring), a new section or entity would be established. The Financial Controller/Project Coordinator to be recruited under the project (para 54) would coordinate project implementation and be the financial adviser to the Director of Livestock. His appointment and the appointments of the Commercial and Financial Director of the Livestock Input Distribution Unit (see below) and the Construction Engineer would be conditions of effectiveness. 64. Input Distribution. For the import and distribution of livestock inputs, DNE would establish, as a condition of effectiveness, a Livestock Input Distribution Unit (BIE) in Nouakchott. The BIE sould have financial autonomy, and would maintain separate accounts. It would be headed by a Director with experience and qualifications acceptable to IDA. The BIE would use DNE's veterinory stations as sales outlets. Veterinary staff would sell drugs and other inputs only against full cost payment. The station chief would be responsible for keeping account of stocks and cash. Periodically, but not less than once per month, a BIE representative would visit the station, to take receipt of the money and consolidate stocks and sales records. The part of sales revenue corresponding to recovered costs would be deposited in the bank account for the respective revolving funds (drugs or feed). If progress is satisfactory at the time of the mid-term review the project would finance BIE facilities at Kiffa. - 19 - 65. A Supervisory Committee would be established under the chairman- ship of the Ministry of Rural Development. The committee would include a representative of the Minister of Finance, a representative of the Minister of Plan and the Secretary General of the National Association of Livestock Owners. The committee would oversee the transfer to the Livestock Fund of the special mark-up on BIE's sales and the use of these funds and those of the treasury account (para 50). It would approve the accounts of the BIE and of DNE and would deliberate on the budget proposal for the use of the Livestock Fund prepared by the Livestock Department for submission for the approval of the Minister of Rural Development. 66. Livestock Fund. BIE would deposit revenue for the Livestock Fund in a special bank account in a commercial Bank in Nouakchott under the joint signature of the Director of Livestock and the Financial Controller. The revenue from the Special Import Fee would be deposited in a special treasury account. Money from these two accounts would be transferred to DNE for use for agreed purposes against periodic budgets prepared by DNE, approved by the Minister of Rural Development and agreed upon by IDA. The funds would be audited as part of DNE's annual audit. Creation of the Livestock Fund and the introduction of the import fee would be a condition of project effectiveness. 67. The Pastoral Cooperative Associations. The associations would be organized in accordance with the Law of Cooperatives of July 18, 1967. They would come under the responsibility of DNE and the Department of Cooperatives of MDR. The associations would be granted land use rights in accordance with the Law on Land Ownership of June 5, 1983 and its imple- menting regulation of January 19, 1984. 68. A mid-term review would be undertaken by Government at the latest 2 1/2 years after effectiveness and the report submitted to IDA for dis- cussion with a supervision mission within four months. The purpose of the review would be to determine: (a) the progress of establishment of pastoral cooperative associations and the estimated rate of future establishment; (b) the viability of all parts of the project; (c) BIE's performance and the need for construction of BIE facilities at Kiffa; and (d) the results of the systems studies an4 the implication for the project design. 69. The report shall assess the project's performance with respect to the following goals that the Government has set for itself: i) establishment of 5 pastoral cooperative associations; ii) a total revenue for the Livestock Fund from sales of drugs and animal feeds of not less than 16 million UM (US$200,000); iii) completion of reorganization of training at ENFVA and starting the training of the Mauritanian Director of Studies; iv) completion of 3 field stations, rehabilitation of 6 existing ones and of all crushes; v) financing of 5 production improvement projects; vi) commencement of the construction of the Abattoir; and vii) commencement of the study on existing livestock production systems. Recurrent Costs and Cost Recovery 70. The project would have only a marginal impact on Government's recurrent expenditure. During project implementation, beneficiaries and - 20 - foreign assistance will finance all incremental operating costs. Upon project completion, the financially autonom.os BIE and the Nouakchott abattoir would be financially self-supportag as a result of full cost recovery. Field services, as well as the Animal Production Division of DNE, would be fully financed by beneficiaries through cost recovery measures. Training would require about UM 3 milli>n per year (base cost) in incremental operating expenditure which will be borne by the Government. This, however, would be more than offset by about UM 10 million per year in savings on veterinary drugs and vaccines previously purchased by Government and distributed free of charge. The following table summarizes the financing of operating costs during and after project implementation. 1986/87 1987/88 1988/89 1989/90 1990/91 1991/92 + (M1 mdllim) anmnclng Beneficiaries 1/ - 10.5 13.8 17.2 20.4 22.0 Cost recovery BIE - 0.9 1.9 2.8 3.7 3.7 Goverrmnt - - - - - 3.0 Foreign Assistance 36.8 25.3 21.0 15.4 11.3 - 1/ Consists of the 15 percent mark-up by BIE and the Special Import Fee on private sector imports. Benefits 71. Project benefits are of four types: (a) improved knowledge and understanding of the livestock sector and a start of better resource management by establishing pastoral cooperative associations; (b) elaboration of a development plan for the livestock sector and the preparation of follow-on projects; (c) institutional and structural reform, particularly with respect to the financing of public livestock services and the removal of price distortions; and (d) increased production. 72. Profound structural changes are needed to put the sector on a sustainable basis. Systems studias (composition of individual herds, ownership, herd movements, grazing rights, and most importantly, the economics of animal husbandry for various types of individual herds) wou'-d be an important project benefit. They would form the basis for a policy discussion on the future of animal husbandry in Mauritania and would lead to a development plan, which would give direction to the sector. In this connection, the experience to be gained from the experiment with the pastoral associations is most important. 73. The project would also bring about institutional reforms by strengthening public services in the sector. Systematic application of full cost recovery for drugs, vaccines, feeds and services performed by the - 21 - regional livestock services, would make public livestock services less dependent on scarce budgetary resources and would therefore prolong benefits beyond the project implementation period. The systematic application of full cost recovery is likely to bring about some structural adjustments. Because livestock owners would have to pay the full financial cost, some marginally profitable herds may be discontinued. 74. Incremental production would be achieved through better animal health coverage and emphasis in extension work on improved production techniques and resource management. With regard to the animal health coverage, there would be positive benefits even at sub-optimal levels of efficiency. While no firm data support t?e claim, these benefits may be even larger in times of drought and feed shortages when there are more weak animals. Production themes to be disseminated by the DNE would address critical aspects of the system (feeding, culling, pasture information, support for herds stranded by feed shortages). Pending the project's long term effects on resource management, it can only assist in the short term by making feed available in the field (at full cost) to help herders overcome immediate problems. Economic Justification 75. The uncertainties and risk surrounding the project make it difficult to calculate an exact economic rate of return. However, it is possible to estimate the incremental production needed to obtain a sufficient rate of return. This has been done by taking into account only the value of the incremental meat production, assuming that the incremental production will result in higher off-take and not in an increase in herd size. It has also been assumed that project benefits would accrue over 20 years and that only 25 percent of the benefits would be realized in PY 1, 50 percent in PY 2, 75 percent in PY 3 and that the full amount of benefits would be obtained only beginning in PY 4. Under these hypotheses, the project would show an economic rate of return of more than 10 percent, with incremental production due to project activities of some 7,600 tropical livestock units (TLU) per year, which seems a very modest goal since it represents only 0.4 percent of the domestic herd. A sensitivity analysis shows that the project is not particularly sensitive to variation in the duration of project benefits. For instance, if the duration of project benefits is reduced from 20 to 10 years, the incremental production required for a 10 percent ERR increases only from 7,600 to 8,500 TLUs per year. Risks 76. The project entails considerable risks. The formation of pastoral associations is a pilot activity, and although examples of success in similar efforts do exist elsewhere (Niger), it is not at all certain that it will be successful in Mauritania, where the socio-economic and political situation is different. The studies component would in all likelihood provide the expected insight into the sector, but it is not certain that this will result in a viable development plan and/or follow-up projects, since the results of the studies and analyses would become irrelevant if the sector's very existence were to be threatened by - 22 - inadequate rainfall. The anticipated incremental production may not be realized if rainfall does not resume at a sufficient level. If rainfall continues to diminish, animal husbandry will become impossible and the greater part of the investment would be lost. Production might also be compromised by unexpected resistance from livestock owners to the project's cost recovery principles. Since some livestock owners are politically very powerful, their resistance might affect Government motivation regarding the project. To minimize this risk, a special PPF was approved to allow the DNE to take action (repair of vaccination crushes) and to extend the project idea to livestock owners. The mid-term review provides assurance that emerging problems can be dealt with At an early stage. These risks must be assumed, however. Failure to implement the project would simply mean abandoning the sector to its current downward spiral. The further destruction of the production potential of the subsector would undermine the living standards of a rural population which is already virtually destitute. In the longer term, the removal of price distort.ons and the beginnings of some order in the subsector, so that the necessary adjustments concerning feed resources and herd size can be made, are necessary if the sector is to be put on a sound footing. PART V - RECOMMENDATION 77. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association and I recommend that the Executive Directors of the Association approve the proposed credit. A.W. Clausen President Attachments January 9, 1986 Washington, D.C. ANNEX I -.23 - Page T-of 6 N*IIEITøAIII - cta TuicamE~ LATA 11S9 8T (liST zu~ T ISTMem lo mCMT NEuaL ENaD.E M18012l~ it6a9i ai1aCh u la mACA, s. ow &am d. macah64 m CaT as (TBunAn uq. no> TOTAL 1030.7 k0.7 1030.7 MRICULTUL 395.1 395.3 394.6 CE Pa can>. (e> .. .. 480.0 1063.8 1134.9 - s fE fui amtræ Pla C~n (kooAS or OL EQUivALEIT) 12.0 114.0 131.0 561.5 623.9 TWGPL~T A~ TXMG g2~z PoPUlnffon.lae-.nAu (Tnusaså ) 981.0 :227.3 1629.0 mA POPULATION (201 TOTAL> 3.4 12.8 25.3 32.0 49.0 PoLmanaN PROaECTIOIS POPULATIOM IN EAR 2000 <HILL> 2.6 STATITOUfi POPULAnOm (HLL) 8.0 PPUIAToN tolIri 1.8 POPULATION UDSiTT PER SQ. M. 1.0 1.2 1.6 65.1 37. PE sQ. EM. ai. AID 2.5 3.1 4.0 124. 470.1 POPUIATION AC STUCTUE <) 0-14 Tn 43.9 45.3 43.5 43.6 43.5 15-44 TS 33.3 31.9 53.2 51.3 53.0 65 AND A^G1E 2.6 2.7 3.2 2.7 3.3 POPULATION 0rr RATE (M) TOTAL 2.2 2.2 2.2 2.9 2.8 URRAM 16.3 15.3 8.0 5.1 4.4 CeuDe BIRT £AT (PER TRaUS) 44.6 44.1 43.0 47.0 40.0 CUDC DATK ATE (PER HOS) 27.1 23.9 18.5 15.0 11.3 CROSS REPRODUCTION RATE 2.9 2.9 3.0 3.2 2.8 PAILY PLAIIINC ACCEPTORS. AMIIAL (TioUs> .. 21.6 USERS (z or >ARRIED .. 1.0 6.4 21.4 POODs AVD gul~TE IDEL OP PO Pr . PE CAPITA (1969-71-100) 107.0 102.0 66.0 12.9 95.1 PER CAPITA SUPLT oP CALORUIS < OP REQMIREMNS) 100.0 89.0 105.0 98.5 116.2 PMTEIAS (CANS PER DAT) 88.0 78.0 81.0 55.4 77.8 OF UNICK ANMAL AND PULSE 50.0 48.0 44.0 l 16.5 17.8 CEILD (AGES 1-4) DEAT DATE 45.2 36.8 26.0 16.6 1.8 LIPE EPeC. AT åE (TEaRS) 38.7 42.4 45.6 52.0 57.8 INPANT DRT. RATE (Pim Tm0S) 184.5 161.5 134.0 108.8 96.8 ACCESS TO SAPE ATEn (OP) TOTAL .. 17.0 84.0 /d 42.4 67.2 URBAN .. 98.0 0.0 W 67.5 93.4 EUAL .. 10.1 85.0 T 35.8 43.8 ACCE S TO EETA DISPOSAL tz OF P~PULATIOII) TOTAL .. .. 1.0 fd 28.9 45.9 0~A .. .. 5.0 57.7 63.0 EURAL .. .. .. 20.7 28.6 POPULATION PER PHYSICIAN 40880.0 18050.0 14350.0 /c 11791.7 4331.0 POP. PER «URSINM PERSOE 5490.0 la 4530.0 200.0 7 2459.8 1845.0 POP. PER MOSPITAL b TOTAL 4830.0 2920.0 2610.0 lc f 981.1 621.8 URAN .. 700.0 1310.0 te 368.8 545.0 RUAL 5270.0 /.9 5430.0 3710.0 4371.9 2511.3 AISSI NS PEt MDIPITAL 8E .. .. .. 27.2 25.7 AVERAGE SIZE OP OGUSEKOLD TOTAL .. URAL .. ATISS NO. OP PERIS/M0m TOTAL.. URBAN .. RURA ..... •. PERCEWTACE OF UL12CS Un ELECT. TOTAL .. URA .. RUAL ..... .. 24 ANNEX I Page 2 of 6 MAIIRTT*SMAL -oct.iNnlcATOM D/M mUrT URITAIA &rFENCE G0UPS (EICKE AVKRAG Le føsT (mST aEC=NT UTDZIT A R=Vr W1Dag INCONE KIDLE 1500 I96Lt 197dk cEiT AFRICA 5. av S"ARA M. AFRICA 6 EM r ADUSTED EOIOLLNT RATIOS I TOTAL 8.0 14.0 33.0 ld 95.7 S9.8 NAL 13.0 20.0 43.0 T1 100.0 103.7 FEALE 3.0 8.U 23.071 13.2 7>.2 SECMoAI: TOTAL 0.6 2.0 10.0 ld 17.3 42.9 KALE 1.0 4.0 16.0"r 25.0 50.9 wEAL 0.0 .. .0T 14.8 34.6 VOCATIONAL <2 C SCNDa) .. 12.5 4.5 lå 5.9 10.0 PUPIL-TEACKER RATIO PRIAR 20.0 24.0 41.0 /d 41.1 29.7 SECONDAR 17.0 24.0 25.0 r 25.5 18.B PASSENGER CARS/THOUSAND POP 0.4 3.3 .. 20.b 17.8 RADIO RCEIVEMS/ThoUSAD Pop 12.2 44.1 119.1 107.8 175.9 TV RECEIVERS/T1OUSAND POP .. .. .. 20.8 51.2 MEUSPAPER (MDAILY CENERAL imcERES") CIRCULATION PIM TN0USAID POPULATI10%. 2.3 lN . 18.4 37.2 C~NEH A L ATT11.CE ~DIICAPIT4 å..03 lt 0.4 2.4 LUM 10= TOTAL LABOR FORCE (MOUS) 303.0 366.0 482.0 FEMALE (PERCENT) 3.8 4.1 4.4 36.2 11.0 AGCULTURE (PPR~ENT) 91.0 8*.0 b9.0 /d 54.5 42.4 INDUST=T (PERCE~ ) 3.0 4.0 8.0 T1 183 27.9 PFATICIPATION RATE (PERCENT) TOTAL 30.9 29.8 29.6 36.8 26.2 NALE 59.8 57.8 56.9 47.1 46.2 FEMALE 2.3 2.4 2.6 27.2 5.8 ECO IC DEPENDENCT RATIO 1.5 1.6 1.6 1.3 1.8 n s arsTlinu PERCENT OF PIVAZE IUCME RECE~E m KliC~Es S F M USE~LS. .. .. RIGEST 20% OF ROUSEROLDS . .. .. LOT 20 F HOSEOLS .. .. L~0E5T 401 OF ROUSEHOLDS .. ESINMTED ABSOLUTE POVERTT INC~ LEVEL (US$ PER CAPITA) URBAN .. .. .. 590.7 226.3 RURAL .. .. 110.0 275.3 134.0 ESTINATED EMATIVE POVERTY I E LEVEL (USS PER CAPITA) URBAN .. .. 330.0/ 545.6 431.5 RRAL .. .. 120.0 201.1 326.0 ESTINATED POP. BEL~1 ABSOLUTE POERTY ENH LEVEL (M) RURAL .. .. .. .. 29.0 .. NOr AVAILABL o APPLICAELE N OT E 5 The group awragea for «ach i-dicator are ppelatio-umighed arithm=tc en. Covurage of cautries ng the indicator deped an avallablity at data and La ~at uniform. /b Unless ahazuise motad. "Data for 196«" rufer to ay year bev~en 1959 and 1961; Data for 1970" beteen 1969 and 1971; and data fcr "ota Recet EtiSate" betve 1981 and 1983. lc 1977; l 1980: . 1962; l Covermmnt hospital «tablismbent*; 4 197S; l 1972. JUNE. 1955 - 25- ANNEX I Page 3 of 6 DEFINITlONS OF SOCIAL INDICATORS Notes Although the data are drawn from sources generally judged the most authoritative and reliable.i should also be noted that they may not beinternationally comparable because of the lack or standarded defmitions and concepts used by different countries in collecting the data. The data are. nonctheles, eful to describe orders of magmitude. indicate trends. and charactecrzc certan major ddlervces between countries The reference groups are IlII the same country group of the subject country and 421 a country group with somewhat higher avcrage income than the country group of the subject country (cxcept for -High incomne Oil Exportcrs- group whercMiddic Income North Africa and Middle East" is chosen because of stronger swoo-cultural allnitiesi. In the reference group data the averacs are population weighted arithmetic means for each indicator and shown only when majority of the countrics ina group has data for that mdicator Since the coverage of countres among the indicators depends on the availab.lty of data and as not uruform. caution must be exercised in relating averages or one indicator to another. These averages are only useful in comparing the value of one indicator at a time among the country and reference groups AREA (thousand sq.km.) crud Birth Rate (pertkousad)-Nurber of live btrths in the year Toral--Total surface area comprising land area and tnland waters: per thousand of mid-year population. 1960. 1970. and 1983 data. 1960. 1970 and 1983 data. Crude Death Rate (per thosand-Number of deaths in the year Agricutura--Estimate of agricultural area used temporarily or per thousand of mid-Year population: 1960. 1970. and 1933 data. permanently for crops. pastures. market and kitchen gardens or to Gren Reproduaimr Rate-Average number of daughters a woman lie fallow. 1960. 1970 and 1922 data will bear in her normal reproductive period if she experiences present age-specific fertility rates: usually five-%,car averages ending GM- PER CAPITA (USS- GNP per capita estimates at current in 1960. 1970. and 1983 market pnces. calculated by same conversion method as uI.rid Fandly Planning-Acceprors. Annual fMasand-Annual num- Bank .4ts 11981-83 bastsi; 1983 data- er of icceptors of birth-control devices under ausptces of national ENERGY CONSUMPTION PER CAPITA-- Annual apparent family planning program. consumption of commercial primary energy icoal and lignite. Fandly P&ahnn-Us- (percent of-rd - )-The pe n- petroleum. ratural gas and hydro-. nuclear and geothermal dcc- tage of married women of child-beanng age who are practicing or trctty pin kilograms of oil equivalent per capita. 1960. 1970. and whose husbands are practicing any form of contraception. Women ' data of child-bearing age are generally women aged 15-49. although for some countries contraceptive usage is measured for other age POPULATION AND VITAL STATISTICS group. Total Population..Mid-Year (theasands --As of July 1. 1960. 1970. FOOD AND NLTRION and 1983 data. hndex of Food Production Per Capita (1969-7) = 100) - Index of per rban Ppailarion (percent of total) Ra.is .f urban to total capita annual production of all food commodtties. Production population. ditferent definitions olurban areas may Affect compar- excludes animal feed and seed for agriculture. Food commodities abiltitv of data .tmong countnies. 1960. I9711..and 1983 data. b atinclude primary commodities (e.g. sugarcane instead of sugar PPtulino oA1*7tons which are edible and contain nutrients (e.g. coffee and tea are Ppularrn m rear 2000- The projection of population for 2000. cxcludedi: they comprise cereals, root crops. pulses. oil seeds. made for each cconomy separately. Startig with information on vegetables. fruits, nuts. sugarcane and sugar beets, livestock, and total population by age and -;er. fertility rates. mortality rates. and Inestock products. Aggregate productton ofeach country is based international migration in the base tear 1980. these parameters on national average producer price "eights: 1961-65. 1970. and were projected at five-year intervals on the basis of generalized 19M2 data. assumptions until the population became stationaryP op Statumarr population Is one in whtch age- and sex-specific mor- ed from calorie equivalent ofnet food supplies available in country tality rates have not changed over a long period. while age-specific per capita per day. Available supplies comprise domestic produc- ferilitd rates have simultaneously remained at replacement level tion. imports less exports. and changes in stock. Net supplies (net reproduction rate - I i. In such a population. the birth rate is exclude antmal feed,wseds for use in agriculture, quantities used in constant and equal to the death rate. the age structure is also food processing. and losses in distribution. Requirements were constant. and the erowth rate is Pero. The stationarm population estimated by FAO based on physiological needs for normal activity ize was estimated tin the bas if the projected characteristics of ard health considering environmental temperature. body weights. the population in the ear 2000. and the rate of decline of ferttlity age andsex distribution of population, and allowing 10 percent for rate to replacement level. waste at household level: 1961, 1970 and 1982 data. Populaion tomentun - 1, the tendenc- for population growth to Pr Capita Supply of Protein (grats per day--Proin content of continue beyond the time that replacement-level fertility has been per capta net ;uppl% of food per day Net -upplv of food is defned achieved. that is. even alter the net reproduction rate ha% reached as above Requirements for all countries established by USDA unity The momentum Of A population in the year r is measured as r ow of 60 grams of total proten per a ratio of the ultimate stationary population to the population in day and 20 grams of animal and pulse proten. ot which 10 grams the year t. gt,en the assumption that fertility remains at replace- should be animal protein. Thes standards are lower than those of ment level from year i onward. 1985 data. 75 grams of total protein and 23 rams of animal protein as an Puation Densty average for the world. proposed by FAO in the Third World Food Per sq.km -Mid-year population per square kilometer I100 hec- Supply: 1961. 1970 and 1982 data. tares) of total area: 1960. 1970. and 1983 data. Per Capita Protein Supply Fom Anad and Pair--Protein supply Per sq.km. agraculuural land-Computed as above for agricultural of food derived from animals and pulses in grams per day: 1961-65. land only. 1960. 1970. and 1982 data. 1970 and 1977 data. Popuation Age Structure (percent)---Children (0-14 yearsi. work- Chi (aes l-4j Death Rate (per thousand) - Number of deaths of ing age (15-64 yearsl. and retired (65 years and oven as percentage children aged 1-4 years per thousand children in the same age of mid-year population: 1960. 1970. and 1983 data. group in a given year. For most developing countries data derived ftpiatin Gowt Rae (prceti-ora- Anualgroth ate of from life tables: 1960. 1970 and 1983 data. Population Growth Rate (percerr--roral-Annual growth rates of total mid-year population for 1950-60. 1960-70. and 1970-83. HEALTH Populstion Growth Rate (percer)--rhan--Annual growth rates Life Expectancy at Birt (years)--Number of years a newborn of urban population for 1950-60p 1960-70. and 1970-83 data. infant would live if prevailing patterns of mortality for all people - 26- ANNEX I Page 4 of 6 at the time of of its birth were to stay the same throughout its life: Pupd-reacher Ratio - primary, and secondary-Total students en- 1960. 1970 and 1983 data. rolled in primary and secondary Levels divided by numbers of Infanr Marteaty Rate (per theusad)-Number of infants who dic teachers in the corresponding levels. before reaching one year of age per thousand live births in a given year 1960. 1970 and 1983 data. CONSUMPTION Access to Safr later (percent of ipquriam)-rota& whan. and Pussauger Cars (per thosand popaIuin)-Passenger cars coin- rusl-Number of people (total. urban. and rural) with reasonable prise motor car seating Less than eight persons; excludes ambul- access to safe water supply (includes treated surface waters or ances. hearses and military vehicles. untreated but uncontaminated water such as that from protected Rado Receirm (per hownwppuladon)-Al types of receivers borchoLs, springs and sanitary wells) as percentages of their respac- ror radio broadcasts to general public per thousand or poulaton: dve populations. In an urban area a public fountain or standpost excludes un-licensed receivers in countries and in years when located not more than 200 meters from a house may be considered registration of radio sets was in effect: data for recent years may as being within reasonable acess of that house. In rural areas reasonable access mould imply that the housewife or members of the houselhold do not have to spend a disproportionate part of the TV Receivers (perthousandpopoltia)-TV receivers for broadcast in fetching the family*s water to general public per thousand population excludes unlicensed TV receivers in countries and in years when registration of TV sets was Aciess to Evcrere Disposal (percent of popstatie)--rotal. urban, in elect. and rura--Number of people (total. urban. and rural) served by excreta disposal as percentages of their respective populations. Excreta disposal may include the collection and disposal. with or age crculation of -daily general interest newspaper define as a without treatment. of human excreta and waste-water by water- periodical publication devoted primarily to recording general news. borne systems or the use of pit privies and similar installations. It is considered to be daly if it appears at least four times a week. Populaio per Physician-Population divided by number of prac- Cinema Annual Atenance per Cat per Yew-Based on the using physicians qualified from a medical school at university level. number of tickets sold during the year. including admissions to Pbpalaion per Nring Person-Pbpulation divided by number of drive-in cinemas and mobile units. practicing male and female graduate nurses. assistant nurses. LABOR FORCE practical nurses and nursing auxiliaries. Population per Hospiral Bed--teral, rba, ad raral-I%pulation Tl ar force adsneondm cluaine pos,in- (totaL urban, and rural) divided by their respective number of ctudentared cor nd unemlo but esDinosi hospital beds available in public and private, general and specialized hospitalsadrhblttocetr.Hsiasacetbimns various countries are not comparable: 1960. 1970 and 1983 data. hospitals and rehabilitation centers. Hospitals are establishments permanently staffed by at least one physician. Establishments prov- Female (percent)-Feralc labor force as percentage of total labor iding principally custodial care are not included. Rural hospitals. force. however. include health and medical centers not permanently staffed Agriculure (percent)-labor force in farming. forestry. hunting by a physician (but by a medical assistant. nurse. midwife. etc.) and fishing as percentage of total Labor force. 10. 1970 and 1980 which offer in-patient accommodation and provide a limited range data of medical facilities. aary (percet)-labor force in mining, construction. manu- Admisions per Hospital Bed-Total number of admissions to or facturng and electricity, water and gas as percentage of total labor discharges from hospitals divided by the number of beds. force. 1960. 1970 and 1980 data. P-rkiipaion Rate (percentr)--,oal. ae. awife-d-u-Partiipation HOUSING or activity rates are computed as total male. and female labor forc Average Sme of Household tpersons per household)-rot urban. a percentages of total male and female population of all ages andraWl--A household consists of a group of individuals who share respectively. 1960. 1970. and 1983 data. These are based on lLO's living quarters and their main meals. A boarder or lodger may or participation rates reflecting age-sex structure ofthe population. and may not be included in the household for statistical purposes. tong time trend. A few estimates are from national sources. Arerage Number of Persons per Room-toral, urban, and rural-- Economic Dependency Rato-Ratio of population under 15. and Average number of persons per room in all urban. and rural 65 and over, to the working age population those aged 15-64 occupied conventional dwellings. r*specrively. Dwellings exclude non-permanent structures and unoccupied parts. INCOME DISTRIBUTION Percentage of Dwelfigs with Ekectriciry--oaU. urban, and rural- Percage of Toal Disposable Income (both h cash and kind)- Conventional dwellings with electricity in living quarters as percen- Accruing to percentile groups of households ranked by total house- tage of total, urban, and rural dwellings respectively. hold income EDUCATION POVERTY TARGET GROUPS Adused Eurowaent Ratios The following estimates are ve approximate measures of poverty Prniarr school - total. male and female-Gross total. male and levels, and should be interpreted with considerable caution. female enrollment of all ages at the primary level as percentages of Estimited Absobste Poverty Income Level (U= per capau-arbor respective primary school-age populations. WInle many countries and rural-Absolute poverty income level is that income level consider primary school age to be 6-11 years. others do not. The below which a minimal nutritionally adequate diet plus essential differences in country practices in the ages and duration of school non-food requirements is not affordable. are reflected in the ratios given. For some countnes with universal Essimared Reame Poverty Income Level (USS per capitc)-wban education. gross enrollment may exceed 100 percent since some and rua-Rural relative poverty income level is one-third of pupils are below or above the country's standard pnmary-school average per capita personal income of the country. Urban level is age. derived from the rural level with adjustment for higher cost of Secondary school - total. male and female-Computed as above: living in urban areas. secondary education requires at least four years of approved pri- Estimated Populton Below Absolute Poverty Income Level (per- mary instruction provides general. vocational. or teacher training cent)-rban and rural- Percent of population (urban and rural instructions for pupils usually of 12 to 17 years of age: correspond- who are'-absolute poor. ence courses are generally excluded. Vocatianal Enroillment rpercent of secondary)-Vocational institu- Comparative Analysis and Data Division tions include technical. industrial. or other programs which operate Economic Analysis and Projections Department independently or as departments of secondary institutions. June 1985 -27- ANNEX I Page . of 6 KO0mImlC IIIDCA10M GaSS IATZOA. P~C IN 1914 ANGIUAL RAE Fr ( in conotant prc**) mU Min. 4 1975-78 (Av.) 1979-S1 19M CBP et at Prics 686 100.0 .5 5.0 4.2 Grass Dometic In~ ~tan 162.2 23.7 52.1 33.8 13.7 Grae. Naa al Savig -763 -10.9 Curreft Acc~unt Naianvs -108.3 27.5 Exports of Good, MPS 336.0 49.3 -4.2 24.8 11.0 Imports of Goods, MP5 511.7 74.8 2.6 11.2 19 0DZPIM. LASOR mR AmI PRODUCZIVITT IN 1983 Valu Added Labor Fore V.A. Per Worker USSMIE. % q4 a S Agriculture 197.0 30.8 30f,.6 66 647 1.8.1 Induatry 152.3 26.5 42.9 9 4,249.4 316.2 Services and Unallocated 260.4 .0.7 128.5 27 2.026.5 IM.7 ToraL/Averag 639.7 100.0 476 100.0 1,363.9 100.0 CEIRAL WVER~IIE FINAICE UH M1n. P*rcent of CDP 1964 198 1980-83 (Av.) Curr~t Receipts 10,296 22.3 16.8 Current Expnditure -10..63 22.7 26.2 Current Bala=w- -167 .3 7.4 Capital Expenditurc -725 1.6 15.6 Overall Blalnce -892 1.9 23.1 Exteral Azeisance (net) 5,353 11.6 23.2 MOET, CREDT AI PRICES 19NI 1982 1983 i9gsh (MiLlion OM Outstanding end-Period) M-ey and Quasi-Money 9,430 9,245 10,085 11,000 Clais on Cover~eit 2,1-3' 4,609 5,142 5,1fs2 Claim on Privata Sector 1,263 11,832 12,9f.2 14,500 (Percentagen ar Index Nufbere) Money and Quas~i-oney an % of DP 23.8 26 23.4 23.8 General Price Inde. (1980 - 100) 111.9 121.3 127.2 143.1 Anmaal Percentage Changes i0: General Price Inde- 11.9 8.4 4.9 12.5 Claias an Goverument 49.5 89.4 11.6 0.0 Claim on Privat Sector 11.7 5.1 9.4 12.0 Note: All conversiong to dollara in chls table are at the average echange rate prevailing during the period cove~d. Sept@br, 1985 ANNEX I - 28 - ~~o Page 6 of 6 TRADE. PATMENS AND CAPTAL ONM ALANC OF PAYMCMES MERCRANDISE EMOS (1981-84 Av.) 1973 1977 1982 1983 1984 MSN (Hillion US) Iran Ore 145.0 52.2 fish Products 126.1 45.4 Esport of Goods, SFS 14.7 178.4 312.3 372.9 336.0 All Other Comodities 6.9 2.4 Iaport of Goods NPS -154.8 -373.8 -630.0 -617.0 511.7 Resource Gap (deficit * -) -10.1 -195.3 *318.5 -2.4.1 -175.7 Total 278 100.0 Interest Psymants (net) -2.0 -4.6 -36.9 -38.6 -24.6 Worker's Remittances 14.5 -27.6 -30.7 -23.0 -18.9 Other Factor Paymuts (at) -5.1 3.5 18.8b 16.4 19.1 Net transfers 31.2 120.4 84.5 61.1 29.9 EXTERNAL DEBT, as of December 31, 1984 Balance on Currant Account -0.5 -113.6 -280.3 -228.2 -170.2 USS min Direct Foreign Investment 10.3 4.4 14.9 .6 12.5 Public Debt, incl. guaranteed 1,170.6 Net M & L/T Borrowing 8.6 55.4 206.1 172.2 50.3 Son/guaranteed Private Debt Disbursemens (11.0) (87.5) (222.0) (194.8) (106.1) Total outstanding and Disbursed 1,170.6 Amortization (-2.4) (-32.1) (-15.9) (-22.6) (46.8) Capital Grants 8.4 13.6 31.0 18.5 47.0 Other Capital (net) -14.2 -1.9 1 DE SERVICE RATIO FOR 1984 1/ Other items n.i.e. -13.2 *0.9 Increase in Official Reserves () -0.7 43.0 48 44.3 45.8 Public Debt, incl. Guaranteed 23.6 NonfGuarsateed Private Debt Total Outstanding and Disbursed 23.6 Gross Official Reserves (end year) 43.7 56.6 125.5 136.5 98.7 Fel and Related Naterials ImPorts ... of which: Petrolem 9.9 30.6 63.0 53.6 42.5 Exports - - 7.1 20.8 of Which: Petroleum - - 7.1 20.8 .. IRD/IDA LENDIN as of November 31. 198 USS Million RAZE OF EMCRAWZ IRD IDA Outstouding and Disbursed 57 66.4 USS1.00 - UK 44.54 52.15 54.8 63.8 63.8 Undisbursed 0 48.9 Outstanding incl. Undisbursed 57.0 125.3 1/ Ratio of .2bt service to exports of goods and non-Eactor services. September, 1985 ANNEX II -29- Page 1 of 2 'UIE SOT[S OF BME GUP OPERATMS IN gRrL4TAI A. Statment of Bank lons and Mk Credits (as of September 30, 1985) Awumt (Iess camelat*io)m US$ lillim Lan or Bank IIA Undisbursed Credit Number Year Borrower Pxm TWin Loans and Ten Credits fully disbursed 126.0 38.9 0.00 888-Mll 1979 Mauritania Urban and kncal Development 8.0 0.46 1068-MAl2 1981 Mauritania Gorl Irrigatim 5.0 3.65 1175-MAlT 1982 Mauritania Petroleum 3.0 1.33 1214-MAI 1982 Mauritania Second ication 5.7 2.70 1231-MAU 1982 Mauritania Fourth Higay 4.0 2.97 1292-Mll 1982 Mauritania Second Technical Assistance 4.6 2.98 1414-M 1983 Mauritania Second Technical Assistance to 8.1 5.0 Rural Sector 1567-MAIT 1985 Mauritana Public Faerprise T*r.xincal Assistance 16.40 16.40 3/ and Rehabilitatim 1571-M1 1985 Muritania Sml1 Scale Irrigation 7.50 7.50 1572-MAll 1985 Mauritania Industrial and Artisan Developent 5.25 5.25 TOTAL 126.0 116.45 48.24 of which has been repaid 72.0 2.26 Total now outstanding 54.0 114.19 Amount sold 63.4 of which has been repaid 63.4 Total now held by Bank and IDA 54.0 114.19 Total undisbursed 0.00 48.24 48.24 1/ Prior to emchange adjustnents. 2/ BeginMing with Credit 1068-MW, credits have been denanizUated in Special Drawing Rights. The dollar amounts in these coluns represent the dollar equivalents at the time of credit negotiations for the IDA amots and the dollar equivalents as of March 31, 1985, for the undisbursed amounts. 3/ Not yet effective. * The status of the projects listed in Part A is described in a separate report on all Bank IDA financial projects in emeutim, which is updated twice yearly and circulated to the Emecutive Directors on April 30 and October 31. ANNEX II -30 - Page 2 of 2 B. Staten~ne of IEC Ivestments (as of Sep~er 30, 1985) Fiscal year Oblifpr ye of Bs T~ u Total 1985 ScPad gsr il21M Total Gross Cn~ ~ts 1.2- - 1.2 Less Cnel la~, Te~~Krnarirme, Pepayn=nts and Seles - Total c~~mints nov held by IEC - - Undisbursed Ba~ance 1/ Please note that Investuit AgrVement has not been signe~ yet. - 31 - ANNEX III Page 1 of 2 ISLAMIC REPUBLIC OF MAURITANIA SECOND LIVESTOCK PROJECT SUPPLEMENTARY PROJECT DATA SHEET Timetable of Key Events Time taken to prepare project: 2 years Project prepared by: Government, Consultants and IDA Identification: Follow-on to First Livestock Project Appraisal Mission: October 1983 Negotiations: October 1985 Planned date of effectiveness: August 1986 Special Conditions The Government has during negotiations provided assurances on the following principal items: (a) Only bona fide cooperative associations formed by pastoral- ists would benefit from the well construction and mainte- nance program financed by the project (para 48); (b) the pastoral cooperative associations, once identified and established, would be allocated legally enforceable grazing and stockwater rights, including the right to deny access to blocks of grazing which they wish to improve and which they themselves are therefore not using (paras 47 and 67); (c) Government would undertake a mid-term review at the latest 2 1/2 years after credit effectiveness and submit the report to IDA within four months. The purpose of the review is to establish whether the project is to be continued, BIE has progressed satisfactorily, the system studies have been useful or any modification in project design is necessary (para 68); (d) i) there would be no restriction on private domestic trade in veterinary drugs and vaccines or animal feed other than those pertaining to technical requirements and quality control; ii) BIE would charge, for all veterinary drugs and vaccines and all animal feeds, full cost c.i.f. at place of sale, plus a special surcharge averaging at least 15 percent of retail sales price; iii) DNE would collect a special import fee from private importers of veterinary drugs, animal feeds and feed supplements amounting to 9 percent of the invoiced cost of the imported items; and iv) this surcharge would be deposited in a Livestock Fund, and the special import fee in a special treasury account the proceeds of both of which are to be used for field operations of DNE against a budget to be agreed upon by IDA (para 50); - 32 - ANNEX III Page 2 of 2 (e) the Production Improvement Fund would only be accessible to pastoral cooperative associations or, exceptionally and with the approval of IDA, to well established groups of tradi- tional pastoralists with no access to bank credit or other kinds of rural development funds (para 55); and (f) the abattoir would be operated on a commercial basis and would charge fees allowing full cost recovery, including depreciation and a profit element (para 56). B. Conditions of credit effectiveness would be: (a) the appointment of the Project Coordinator/Financial Controller, the Commercial and Financial Director of BIE and the Construction Engineer (para 63); (b) the establishment of BIE and the creation of an appropriate accounting system (para 64); (c) the creation of the Livestock Fund and the introduction of a special import fee (para 66); (d) the establishment of the Range Management and Stockwater Sections of the Animal Production Division of DNE (para 52); and (e) the AfDF Loan Agreement and the OPEC Fund Loan Agreement have been executed and delivered and all conditions prece- dent to their effectiveness or to the right of the Borrower to make withdrawals thereunder, except for the effectiveness of the Development Credit Agreement, have been fulfilled (para 58). MAURITANIA SECOND LIVESTOCK PROJECT PROJECT COST SUMMARY (UM Million) (US$ Million) . Total -.---.--.---.--..-----. ----------------------- Foreign Base Local Foreign Total Local Foreign Total Exchange Costs A. PASTORAL ASSOCIATIONS 13.8 88.7 102.5 0.2 1.1 1.3 87 11 B. SYSTEMS STUDIES, MONITORING AND PROJECT PREPARATION 41.7 77.5 119.2 0.5 1.0 1.5 65 13 C. DISTRIBUTION INPUTS 16.0 119.4 135.4 0.2 1.5 1.7 88 14 D. STRENGTHENING OF LIVESTOCK SERVICES MANAGEMENT 18.5 67.5 86.0 0.3 0.8 1.1 73 9 ANIMAL HEALTH 77.9 106.9 184.8 1.0 1.3 2.3 58 19 ANIMAL PRODUCTION 66.9 63.5 130.4 0.8 0.8 1.6 49 13 TRAINING 27.5 63.2 90.7 0.3 0.8 1.1 70 9 Sub-Total STRENGTHENING OF LIVESTOCK SERVICES 190.9 301.1 492.0 2.4 3.7 6.1 61 50 E. ABATTOIR 17.1 59.6 76.7 0.2 0.8 1.0 78 8 F. PPF - 41.2 41.2 - 0.5 0.5 100 4 Total BASELINE COSTS 279.4 687.5 966.9 3.5 8.6 12.1 71 100 Physical Contingencies 20.4 72.7 93.1 0.3 0.9 1.2 78 10 Price Contingencies 109.8 147.6 257.4 1.4 1.8 3.2 57 26 Implementation Delay Contingencies 64.0 64.0 128.0 0.8 0.8 1.6 50 14 Total PROJECT COSTS 473.7 971.8 1,445.5 6.0 12.1 18.1 67 150 mam ... m=ammma mam mam.m mamma wwma mmo SECO41 LivESIOCK PROJECI linancing Plan by Sum~ry Accounte (sUs '1000 RIA.MN. OF AI1I OPEC lek lAf-IWD MOURCNG1 ffalEm. lta-Gll lota& %t .. . . . . . ..........-. ....-. - .... . .. . ........----- -----------.-- .-- . - --------.-- -.------------. lEtel. outI«s a kmunt 1 Amount unt I Amunt I Aunt I x mut i Amunt I aunt I for. Eneh. as awer ....... .*tte ...*.is .... sas....a2a.s m.. s.: *gas Z*tmigzi *sti= =:siiiii=== 33x:3= 93=3=9a= I. INVESINENI C0515 A. £i111 HM (CHI 1,413.5 51.9 583.8 22.3 - - 500.0 19.8 - 0.0 0.0 2.527.2 14.0 1.285.8 1.241.4 - R. SIOCN NAIER DEVELOPMENI INEI • - 1,470.1 100.0 ••. •.-.*...•.. .1.470.1 8. I 1.229.1 241.1 • C. EQUIPNENT IEQ) 495.6 100.0 - - .--- -- •-- 495.5 2.7 443.5 52.2 - o. VEHICLES (Vitl 694.0 90.5 92.9 9.5 - -- - -- --- 987.9 5,5 539.0 41.9 - E. I.A. AND CONSULIANIS liål 965. I 29.? 154. 4.? 2. 125.? 65.5 --. -.-. -. -. -. -.3.245.1 18.0 3.011.4 119.5 • F. STUDis (s. - - - 852.2 100.0 -3•. •.• . -.- . -1852.2 4.1 458.3 314.0 - 0. INPIS 1111. 1.120.3 59.5 . - . 2.5 • - 452.8 28.1 1.112.1 8.9 1.810.4 2.4 • M. PR00.IRPROVEMENT FUND lOPil 908. I 100.0 - -- - - 411.-.98. I 5.0 4218.3 419.1 - I. SCNIANSHIPS 1115 431.? 100.0 . . . . ......-. -.-. •.•.431.7 2.4 214.5 211.2 - 4. 1E1amEt PPf pp) • . - 515.0 100.0 . .-. -. -. -.515.0 2.5 515.0 • • 1. UNALIOCATED (<A 113.8 9.4 61.9 3.8 1.607.3 89.8 - - - - - 0.0 0.0 1.789.0 9.9 989.0 00.0 - . . ............. ... .. ....... ...... .... ...... .... .... .. ..... ---- -- ---------.... Total INVEITMENI C0119 5.211.8 35.5 2.000.0 13.5 6.571.8 44.3 500.0 3.4 39.1 0.3 - - 452.8 3.l 14.13 8.1 e2. I 11.119.5 3.841. - l1. RECURRENI CoMtI EQUIPÆNI OPIIION 1(«01 84.0 23.6 • - 84.0 23.1 • - - - 118.0 5.5 0.0 0.0 356.0 t.0 240.1 11.3 VENICLE OPIRAl0N (Vol 164.8 25.I - - 164.8 28. • - - - 302.5 41.9 0.0 0.0 832.3 3.5 426.6 Mi.i - LOCAL PERONEL ILPI 506.9 30.9 • 508.9 30.9 - - 629.9 38.2 0.0 0.0 1.47.4 9.1 - 1.47.4 - NlsCctIANEOUS (MSI 210.5 45.3 - - 210.5 45.3 - - - - 55.8 5.4 0.0 0.0 598.1 33 210.1 30.5 - 1ot8l PICUPPNENI £051 1.028.2 31.8 - 1.028.2 31.8 • • - 17. l 36.4 0.0 0.0 3.233.4 17.9 9157. 2.274.9 Total allburs ~gnt 5.300.0 34.9 2.000.0 li. 1 1,500.0 42. I 500.0 2.8 39.8 0.2 I. 16.1 6.5 452.8 2.5 18.068.5 100.0 12.147.1 5.021.4 - .............................. ese..... . ... n.. .* "=. . ........... ..............................= - 35 - ANNEX VI Page 1 of 6 ISLAMIC REPUBLIC OF MAURITANIA SECOND LIVESTOCK PROJECT NEW TRENDS IN PASTORAL DEVELOPMENT A. Introduction 1. The approach to pastoral development has undergone considerable change since the 1970s, mainly because earlier projects, geared p:e- dominantly to top-down technical change, did not produce the desired results. Attention shifted towards new strategies; several books have appeared, workshops have been held, and the International Livestock Center for Africa (ILCA) has undertaken an interdisciplinary study on three selected Maasai Group Ranches in Kenya, the results of which are soon to be published. The general consensus so far is that: (a) development interventions can achieve little without the participation of pastoralists; and (b) the key to productivity is better resource management by the livestock owners themselves. Interventions today consist mainly of investments to improve the quality of pastoral life: human and animal health, stockwater conservation and development, and training for better resource management. 2. The potential for improving range productivity is limited. The technology developed in Australia and the United States is very energy-intensive and at present inappropriate for traditional livestock production systems in Africa. Stock numbers must therefore be brought into line with the carrying capacity of the range, which is being reduced by expanding crop cultivation and decreasing rainfall. Better managem=nt of renewable resources on the communal rangelands represents a challenge. Some measure of social and territorial organization must be instituted and the responsibility of pastoral groups for their traditional grazing areas recognized. Pastoral development has therefore become concerned with the human resources and the idea of producer group participation has grauually taken center stage. 3. With the focus of development efforts moving from Government to the livestock production system itself, the design of a project requires prior knowledge of the priorities of those systems. If such knowledge is scarce, part of a first project may be devoted to a study of the system. Such a project would include a 3-year study of the sector, particularly the economics of the production system. It might also include provision of infrastructure, inputs, animal health/services, and staff training. A relationship of trust must be created between those doing the study and the pastoralists, so that the latter can be intimately involved in the project design. 4. Inputs for animal health and production need to be made available to those livestock owners who desire them. They would consist of veterinary drugs and vaccines, animal feeds and feed supplements. Veterinary drugs used to be free in Mauritania and in many other Sahelian - 36 - ANNEX VI Page 2 of 6 .countries and hence tended to be scarce as pressure on the national budget increased. Import and distribution networks need to be reorganized. Domestic distribution should preferably be done by the private sector under the supervision of the Livestock Department. Where this is not possible, an interim solution must be found by involving the public sector until livestock owners are sufficiently organized to take over. Whenever feasible, imports should also be handled by the private sector. However, there are cases where, for reasons of quality control and technical considerations, Government wishes this to be done by a public agency. If this can be well organized (and satisfactory examples of this exist), this should also be acceptable. 5. Most Governments have a livestock department, generally in the Ministry of Agriculture or Rural Development. These were set up prior to independence as regulatory services concerned only with animal health and taxation. National livestock services in the future must be different. While it is true that preventive vaccination against major epidemics will still be required, this should no longer be the only or even main activity of the department. Nor can the attitude of the extension agents continue to be that of the regulator who orders the livestock owners around. The new role of the livestock department and its agents will have to be that of a collaborative advisory service whose operations are made possible by the contributions of livestock owners and whose main occupation will be to advise on the rehabilitation and maintenance of renewable resources such as rangelands and stock water to inform the livestock owners about market opportunities and to facilitate the transfer of animals and other products to internal or external markets. To achieve this, all staff will have to be retrained and gradually reoriented. Moreover, a much stricter technical management of the department will be required to keep costs to a minimum. . 6. Training is important both for agents of the livestock department and for livestock owners. This concerns not only training of new staff of the department but also re-training of all in-service staff. Training of livestock owners is required to make them understand the new approach of the service, including the fact that in one way or another they are going to cover the cost of all operations except personnel salaries. Where grouping of pastoralists into Pastoral Associations is achieved (see below), training of the officials of these associations will be necessary. Finally, livestock technicians will have to be trained in the management of renewable resources for animal production (grazing and stock water) in order to be able to advise the associations. B. Pastoral Associations 7. The concept of the Pastoral Association (P.A.) is that groups of pastoralists who normally live and move together should formalize this interdependency by the creation of a legal association that can act for the group in matters of credit and input procurement, and negotiate with other P.A.'s and political/technical agencies of Government. The establishment of the association would be undertaken by a team (sociologist, livestock specialist and cartographer). The grazing lands of the group would be - 37 - ANNEX VI Page 3 of 6 .identified, and the traditional rights of access by any third party would be recorded. Usufruct rights would then be allocated, subject to the respect of the rights of third parties, in exchange for a commitment to manage the grazing land in accordance with sound practices and the advice of the Regional Livestock Service, which would have the responsibility for extension and monitoring. Any third parties contesting the allocation or wishing to register its rights to use the area would have to apply to the local authorities. Once the group has been officially registered with the local authorities, it would be eligible for credit or technical assistance for stockwater development, i.e., extension advice, repair of existing wells or the construction of new ones. 8. The principle with respect to credit could be that the associa- tion would first have to demonstrate its commitment by depositing a certain amount (possibly 25% of the estimated cost of the investment). In the case of a very large investment, e.g., a deep-well/storage well complex, the deep well could be subsidized by Government, and the storage well financed on credit once the downpayment had been deposited. For smaller investments, a Production Improvement Fund may be established which would subsidize small rural works or firebreaks on condition that the group provides a significant part of the cost in cash or kind. 9. The goal would be to create associations incorporating 400-500 families (8-10,000 head of livestock) to facilitate administration. It is not certain that such large groups would be easy to form, however. The larger units would probably be more effective in representing the pastoralists at the local and the national level, but they could only be formed after both officials and members had benefited from extensive training. On the other hand, larger group., may be more subject to internal rivalries. Only experience will show what is the optimal size. A compromise might be the formation of several smaller associations (30-50 families) which are then consolidated into one large, registered and officially recognized association. 10. The group approach is facilitated by the fact that many Govern- ments are now moving towards decentralization, with rural producer groups now encouraged ro take responsibility for their own affairs. In sedentary agriculture, this has led to greater importance of village groups, which have responsibility for input distribution, credit and sometimes marketing of their production. This change of attitude is partly due to national budgetary pressures. 11. As far as resource management goes, the risks associated with pastoral associations are that the allocated grazing areas may be overstocked by the associations and might suffer degradation. In theory, a group that is not respecting the contract could be evicted, but this would not be so easy in practice. There is also a social risk involved, in that traders and politically influential people might form associations in better areas and around wells, thereby discriminating against the small livestock owners. Finally, there is the risk that the credit may not be repaid once the stockwater has been provided. Traditional pastoralists are - 38 - ANNEX VI Page 4 of 6 generally known as reliable debtors in their own environment, but they may not be able to handle institutional credit the same way. 12. The World Bank is presently involved in financing two projects involving pastoral groups: one in Niger (Projet Elevage Centre-Est Cr. 885-NI of March 1979) and one in Mali (Opfration de 1'Elevage Mopti (0DEm) Cr. 538-MLI of May 1985). Nearly a hundred groups have been formed under the Niger project (Groupes Mutualistes Pastorales (GMP)). Each group consists of 30-50 families who work together and often have the same chief. Five pastoral centers have been constructed to serve as outposts for the technicians from the Livestock, Human Health and Adult Literacy Services and for seconded officials from the Cooperative Service (UNCC). Unfortu- nately, the severe drought of 1983-84 has delayed the start up of the centers. L3. In Mali, a major study was carried out by the International Livestock Center for Africa (ILCA) under contract to the ODEM project in the Niger Delta. The project is now engaged in the formation of the first associations, an activity to be continued under the follow-on Mopti Area Development Project. In an early experiment, an association was formed around a borehole fitted with a solar pump and a contract was drawn up. For six months the arrangement worked very well until the pump ceased to function, thus preventing the full experience from being gained. The associations would primarily be developed by the Mopti Area Development Project in two locations on about one 1 million hectares of grazing land which were underutilized because of the absence of stock water. The formation of associations would therefore be paired with stockwater development and the allocation of dry season grazing. In Niger, on the other hand, all GMPs are based on existing traditional groups and the Government has not yet made a decision on the subject of allocation of usufruct rights; consequently, stockwater development has yet to take place there. 14. The dynamics of change in the livestock sector should not be underrated. Ownership of livestock, and especially of cattle, is shifting from the traditional pastoralists to the cultivators who used to be their client/customers (or even former slaves) and to the modern absentee owner, who might get a higher yield from livestock than from a bank and also obtain great satisfaction and prestige from being a cattle owner. One might even eventually envisage a much diminished pastoral population entrenched in the uncultivatable arid and semi-arid zones and surviving the dry season either by grazing crop residues or actually importing feed or by-products from the agro-industries. At the same time, the mono-culture farmer would have become a mixed farmer, rotating fodder and cereal crops in order to maintain his livestock production for consumption and surplus sale. The absentee owner may disappear for several reasons: (a) it would become harder to find free grazing or wells which were not appropriated by a group; (b) investment possibilities would become more attractive than owning cattle; and (c) Government policies would actively discourage this form of capital shelter in order to protect renewable resources and the rural producer. - 39 - ANNEX VI Page 5 of 6 15. In summary, therefore, the pastoral association is the logical alternative at this stage, if we discard high-energy solutions as too costly. However appealing and logical, however, it is not a proven intervention and may not materialize, especially if it is not fully understood or accepted by politicians. But it coincides with a drastic change in government policy from centralization to village and group self-management and with the appearance of well-trained national professionals with sufficient insight and motivation to implement the concept. Finally, after a decade of low rainfall, pastoralists re.lize that isolation and inactivity do not get them anywhere. They seem to be ready to try anything that promises to improve their situation. Therefore, the concept of pastoral associations should be tried but it should be closely guided to avoid failure due to administrative weakness rather than to any intrinsic weakness of the concept. C. Establishment of Pastoral Associations under the Project 16. This component was given high priority in the preparation docu- ment and it may eventually become the most important component in pastoral development in Mauritania. The appraisal mission agreed with Government however, that there were too many imponderables regarding the pastoral and agro-pastoral production systems and that an experimental approach would be more prudent. 17. The cattle herds of Mauritania are owned by three main groups: (a) traditional Maure pastoralists; (b) Maure traders and Government officials who, since the great drought in 1972, have increasingly tended to purchase cattle from traditional producers and have established large "new herds" often herded by the former owner who has become a salaried herdsman; and (c) the traditional Peul agro-pastoralists (Fulbe diesi et Fulbe wale) who, although they have been in the country a long time, have no traditional rights to land but are instead purchasing access to land from the Maures. It is not certain who owns the largest part of the national herd, but indications are that the traditional Maure pastoralists own a small percentage perhaps as low as 20% and that the two other groups share the rest about equally. 18. Production system studies w.11 bring improved understanding of what is going on. The low-cost traditional system of production is threatened with extinction. Whatever new system emerges will almost certainly have higher costs. Such a system is also unlikely to be the result of a natural "free market adjustment", since political forces are clearly at work in the sector. The establishment of pastoral associations may therefore be the only means by which the traditional pastoralist systems can survive to some extent - by organizing into self-sustaining groups usufruct rights to their traditional grazing lands, collective responsibility for their own economy including the improvement of their grazing lands, and access to credit that would restore cattle ownership to viable households in the associations and thus maintain the viability of the group in the face of competition. - 40 - ANNEX VI Page 6 of 6 19. The establishment of pastoral associations demands thorough preparation consisting of a detailed socio-economic survey of the area, pasture inventory, and assessment of stockwater points and traditional rights. The survey team establishes contact with other pastoral groups in the area - and starts a dialogue with them, culminating in the general assembly which formally establishes the association. The survey and establishment are carried out by an interdisciplinary team of Mauritanian professionals (a sociologist, a pastoralist and a cartographer) assisted by a consultant in anthropology and economics. 20. Experience so far shows that the first groups to be identified normally consist of 30-50 families and their livestock. It would probably take ten such groups to form an association of the desired size. Each of these ten pastoral groups should be formally established and given training in the new role, as well as the opportunity to handle a small revolving fund for basic supplies (tea, sugar and grain) before their consolidation into an association is attempted. 21. Once the association is established, responsibility for its day-to-day servicing is transferred to the nearest regional livestock center which requests from the department the necessary extension service (pasture management, stockwater development and housing) and assists with the provision of veterinary drugs and animal production inputs for sale. 22. Each group will employ an agent selected from the group itself. This agent will receive basic training in veterinary first aid from the veterinary station and will become the contact between the group and the nearest regional center. Once the association is formed, its needs in terms of pasture management and stockwater development will be assessed through joint visits by the stockwater and range management officers from the animal production division. The animal production officer would visit to advise on the use of minerals, feeds and feed supplements. The associa- tion could buy inputs directly from BIE and would receive a commission on sales to be used mainly for paying the agent, but also to establish a common fund for maintenance of wells and other structures. IBRD 18302 AErA A U F l TA NIA O-m, SECOND LIVESTOCK DEVELOPMENT PROJECT Q DEUXIkME PROJET D' ELeVAGE AUTAI M GE l N C H l R B --ADElARäMFTaMs ARAR A D R A R co 2l 2o W- IM11 ATLANTIC ------- OCEAN ---- ---- H0 D*'E 0 c1 cEAST) ~5 -~~~~- - -- -- -- -- AG- N T. RÅ A R LA B E N E G A L----A - S1E1N E G A L s 211 Ms -7:O EE,