China - Shandong Agricultural Development Project

Docwment of The World Bank FOR OFFICIAL USE ONLY G1z2 20/1 R_ptl No. 7513-C STAFF APPRAISAL REPORT CHINA SHANDONG AGRICLTURAL DEVELOPMENT PROJECT APRIL 17, 1989 Country Department III Asia Regional Office Agricultural Operations Division This document has a restricted distribution and may be used by recipients only in the perfonnae of their official duties. Its contents may not otberwise be disclosed witbout World Bank authorizatio.  CURUNCY gQUIVALENTS Currency Unit - Yuan (Y) US$1.00 * Y3.7 Y 1.00 * USS0.27 FISCA YEA January 1 co December 31 WEIGHTS AND MEASURES 1 meter (i) - 3.28 feet (ft) 1 kilometer (km) a 0.62 miles 1 hectare (ha) a 2.47 acres 1 mu a 0.067 ha 1 ton (t) a 1,000 kg - 2,205 pounds (lbs) 1 kg - 2.2 pounds (lbs) PRINCIPAL ABREVIATIONS AND ACRONYMS USED ABC - Agricultural Bank of China AITC - Agriculture Industry and Trade Corporation BOF - Bureau of Finance CAS - Chinese Academy of Sciences CAAS - Chinese Academy of Agricultural Sciences CEROILS - China National Cereals, Oils and Foodstuffs Import and Export Corporation DAP - Diamionium Phosphate ECH - Engineering Command Headquarter FITC - Forestry Industry and Trade Corporation d FTB - Foreign Trade Bureau FTC - Foreign Trade Corporation GAIC - General Admiaistration of Industry and Comierce GVAO - Gross Value of Agri.ultural Output HECH - Haihe Engineering Comnand Headquarter IAMO - Irrigation Area Management Office ITC, CNTIC - International Tendering Company, China National Technical Import Corporation ICB - International Competitive Bidding LCB - Local Competitive Bidding MOF - Ministry of Finance MOFERT - Ministry of Fcceign Economic Relations and Trade PC - Planning Comission PCBC - People's Construction Bank of China PO - Project Office PREDIC - Provincial Rural Economic Development and Investment Corporation RCRD - Research Center for Rural Development SAAF - Shandong Association of Agricultural Funds SPC - State Planning Comuission WFP - World Food Program  FOR OFFICAL WU ONLY SHANDONG AGRICUU URAL DKVEI)PtKNT PROJEC Credit and Project SuMarv borrower: People's Republic of China Beneficiaries: Shandong Provincial Government Credit Amount: SDR 82.5 million (US$109 million equivalent) Credit Terms: Standard, with 35 years maturity Relending Terms: From Government to Shandong Province: 20 years, including five years of grace, with interest at 5.5% and a commitment fee of 0.5% p.a. Onlending rates to final beneficiaries would be no less than Agricultural Bank of China charges on subloans for similar purposes with similar maturities. Objectives and The main objective of the project would be to increase rural Description: insomes through agricultural development in three components: (a) an expansion and improvement of irrigation covering 271,600 ha of mainly foodgrains in the Tuhai Basin; subcomponents would also finance pasture development, production of Chinese dates, tree planting, cattle, sheep and poultry; and provision of fertilizer, machinery and equipment, seed centers, fruit processing plants, and technical service centers; (b) a significant upgrade of the livestock subsector in the Yi Meng Mountains poverty area through the establishment of breeding and multiplication farms for rabbits, pigs, poultry and geese and processing facilities for feed and livestock products and improvement of veterinary and extension services that make special provision for the predominantly women livestock farmers, and (c) establishment of mariculture in coastal wastelands through construction of shrimp ponds and growing structures for abalone, scallops and sea cucumber culture and provision of hatcheries, cold stores, feed mills, technical service centers, vehicles and boats. The project would also provide technical assistance and training for technical a:id managerial staff. Benefits and Risks: At full development, annual incremental production would be about 147,000t wheat, 156,000t corn, 15,000t soybeans, 1,100t peanuts, 36,000t cotton, 55,000t vegetables, 65,000 t dates, 206,000 cu m timber, 10,000t rabbit meat, 8,000t pork, 4,500t beef and lamb, 2 m. geese, 3.8 m. broilers, 120t rabbit hair, i,300t wool, 8,800t shrimp and 16,000t specialty sea food. Per capita incomes would increase by 55% for 1.3 m families in the Tuhai Basin from crops alone and by 115% for 200,000 families in the Yi Meng area. Annual output in mariculture would increase by US$25 m. Significant employment would be created in all three components; employment creation for women would be notable in the Yi Meng component. No major risks are anticipated. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  - ii - Estimated Cost: Local Foreian Total - - - (US$ million) - - - Tuhai Basin Agriculturirl Development Irrigation and Drainage 47.6 19.1 66.7 Agriculture and Forestry 5.5 14.3 19.8 Livestock Production 2.0 1.4 3.4 Agro-processing 7.5 5.3 12.8 Sub-total 62.6 40.1 102.7 Coastal hariculture Development Shrimp Production 61.2 30.6 91.8 Exotic Seafood Production 5.4 13.1 18.5 Sub-total 66.6 43.7 110.3 Yi Meng Mountains Livest,ick Development Livestock Production 6.5 3.4 9.9 Agrc-processing 14.4 13.0 27.4 Sub-total 20.9 16.4 37.3 Institutional Support 0.3 0.6 0.9 Base Cost /a 150.4 100.8 251.2 Physical ContingencJes 5.0 3.0 8.0 Price Contingencies 8.1 5.0 13.1 Total Project Cost 163.5 108.8 272.3 FinancinR Plan IDA 0.2 108.8 109.0 Central Government 10.8 0 10.8 Provincial Government 7.0 0 7.0 Municipal/County Governments 113.2 0 113.2 Agricultural Bank of China 32.3 0 32.3 Total 163.5 108.8 272.3 Estimated Disbursement: IDA FY 1990 1991 1992 1993 1994 Annual 22.0 32 0 36.0 14.0 5.0 Cummulative 22.0 54.0 90.0 104.0 109.0 Economic Rate of Return: Tuhai: 342 Coastal: 24Z Yi Meng: 35Z Overall Project: 292