Transcript of joint meeting of the Executive Directors of the IBRD and IDA, held on Thursday, February 28, 1991 : Argentina - Agricultural Services and Institutional Development Project

1 run STRICTLY CONFIDENTIAL NM INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION Thursday, February 28, 1991 Washington, D.C. - The meeting of the Executive Directors was convened at 10:44 a.m. in the Board Room, 1818 H Street, N.W., Washington, D.C., Mr. Wilfried Thalwitz, Chairman, presiding. - - MILLER REPORTING CO., INC. 507 C Street, N.E. Washington, D.C. 20002 (202) 546-6666  2 run STRICTLY CONFIDENTIAL - C O N T E NT S ITEM PAGE - 3 Proposed Loan - Argentina (Agricultural Services and Institutional Development Project) 48 - ·- MILLER REPORTING CO., INC. ,01 C Succ1, N.E. Washingmn. D.C. 20002 (202) )46-6666 nm STRICTLY CONFIDENTIAL 48 - - - :··:. · Item three on the agenda is a memorandum and recommendation on a proposed loan in the amount of $33.5 million U.S. equivalent to the Argentine Republic for the Agricultural Services and Institutional Development Project. Mr. Wilson of the LAC Region will introduce the MILLER REPORTING CO., INC. 507 C Street, N.E. Washington, D.C. 20002 (202) 546-6666 nm STRICTLY CONFIDENTIAL 49 - proposal. Mr. Wilson, you have the floor. MR. WILSON: Mr. Chairman, Members of the Board: Good morning. Argentina has a significant comparative advantage in agriculture. Its rich and varied agro-climatic environment ensures self-sufficiency in most foodstuffs and provides an abundant low-cost raw material for a developing agro-in- dustrial complex. Argentina, as we know, is a significant player in world agricultural markets, and its agricultural sector produces about three-quarters of the country's foreign exchange earnings. ·- Despite this, agriculture of producing well below its potential and further growth, especially in non-traditio- nal products, will require greater access to export markets. Unfortunately, Argentina has a poor image in export markets for non-traditional products due to poor quality control, unreliability of supplies and a passive approach to export marketing. There is, therefore, increasing pressure on Argentine agriculture to become more aggressive in seeking to .- exploit its comparative advantage. First, however, key technical constraints will have to be removed, specifically - in plant protection, animal health and quality control MILLER REPORTING CO., INC. )07 C Street, N .E. Washington, D.C. 20002 {202) 546-6666 nm STRICTLY CONFIDENTIAL 50 - services. - The project before you aims to improve Argentina's capability to compete in export markets. The effectiveness of quality control services would be strengthened and mechanisms established to reduce the level of budgetary support needed. Furthermore, diversification of the agro-export product mix would be stimulated by strengthening marketing, export promotion and technical and research services through joint public and private sector efforts. The overall impact on the environment would be positive. Animal health and plant protection components would provide mechanisms to control disease, pests and levels of chemical residues in foodstuffs. The fisheries component would support monitoring of Argentina's considerable maritime resources. During project preparation great efforts have been made to map out strategies to improve the efficiency and impact of the key institutions providing agricultural services in Argentina. The adoption of improved technology to increase output and value-added to meet the demands of new - markets are key components of this development strategy. Thank you. - MR. THALWITZ: Thank you very much, Mr. Wilson. MILLER REPORTING CO., INC. 507 C Screet. N.E. Washington, D.C. 20002 ( 202) 546-6666 run STRICTLY CONFIDENTIAL 51 - Are there any comments or questions? (No response.) --- MR. THALWITZ: If there are none, the minutes will show that the loan is approved on the terms proposed. -- MILLER REPORTING CO., INC. 507 C Street, N.E. Wuhington, D.C. 20002 ( 202) }46-6666