Tunisia - Medjerda - Nebhana Irrigation Development Project

Documeut of The World Bank FOR OMCAL USE ONLY Repot No. 10416 PROJECT COMPLETION REPORT TUNISIA MEDJERDA/NEBHANA IRRIGATION DEVELOPMENT PROJECT (LOAN 2157-TUN) MARCH 17, 1992 MICROFICHE Copy RePorot No. 10416-TUP Tpe: (PCR) JON~ES, W. / X31756 / ~9 5 7/ OiEDDI~ Agricultural Operations Division Country Department I Middle East and North Africa Regional Office 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 BaDk authorization.  PROJECT GOMPLETION REPORT MEDJERDA/NEBHANA IRRIGATION DEVELOPMENT PROJECT (Loan 2157-MU) CURRENCY EOUIVALENTS Currency Unit - Dinar (TD) Appraisal Year, average US$ - TD 0.59 Implementation average USS - TD 0.80 Completion year, average US$ - TD 0.88 ABBREVIATIONS BNT - National Bank of Tunisia CRDA - Regional Agricultural Development Commission CTV - Territorial Extension Unit DCOMVPI Directorate for Coordinating Development Agencies of Irrigation Perimeters DEGTH - Directorate for Hydraulic Studies and Major Works DGPDIA - Directorate for Planning, Development and Agricultural Investments MOA - Ministry of Agriculture OMIVAN Nebhana Irrigation Development Agency OMVVM - Medjerda Valley Development Agency PPI Public Irrigation Perimeters FISCAL YEAR OF BORROWER January 1 - December 31  FOR OFFCIAL USE ONL THE WORLD BANK Washington. D.C. 20433 U.S.A. Office of Dirctoq-Gerwal Opuraltm Evakaatkm March 17, 1992 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report - Tunisia Medjerda/Nebhana Irrigation Development Project (Loan 2157-TUN) Attached, for your information, is a copy of a report entitled "Project Completion Report on Tunisia - Medjerda/Nebhana Irrigation Development Project (Loan 2157-TUN) prepared by the former Europe, Middle East and North Africa Regional Office. No audit of this project has been made by the Operations Evaluation Department at this time. Attachmfent 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.  PROJECT COMPLETION REPORT FOR OFFICIAL USE ONLY TUNISIA MEDJERDA/NEMHANA IRRIGATION DEVELOPMENT PROJECT (Loan 2157-TUN) Table of Contents Page No Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .i Evaluation Summary . . . . . . . . . . . . . . . . . . . . . . . i PART I. PROJECT REVIEW FROM BANK'S PERSPECTIVE A. Project Identitv . . . . . . . . . . . . . . . . . B. Project Background . . . . . . . . . . . . . . . .1 C. Project Objectives and Description . . . . . . . . . . . . . . 2 D. Project Design and Organization . . . . . . . . . . . . . I . 3 E. Project Implementation . . . . . . . . . . . . . . . . . . . . 4 F. Project Results . . . . . . . . . . . . . . . . . . . . . . . 6 G. Project Sustainability . . . . . . . . . . . . . . . . . . . 10 H. Bank Performance . . . . . . . . . . . . . . . . . . . . . . 12 I. Borrower Performance . . . . . . . . . . . . . . . . . . . . 13 J. Bank/Borrower Relations . . . . . . . . . . . . . . . . . . 14 K. Consulting Services . . . . . . . . . . . . . . . . . . . 14 L. Project Documentation and Data . . . . . . . . . . . . . . . 15 PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE A. Comments on the Medjerda Component . . . . . . . . . . . . . 16 B. Comments on the Analysis Contained in Part I . . . . . . . . 16 C. Evaluation of Bank Performance . . . . . . . . . . . . . . . 17 D. Evaluation of OMVVM Performance . . . . . . . . . . . . . . 17 E. Relations between the Bank and the Agency . . . . . . . . . 18 F. Comments on the Nebhana Component . . . . . . . . . . . . . 18 G. Comments on the Analysis Contained in Part I . . . . . . . . 19 H. Evaluation of Bank Performance . . . . . . . . . . . . . . . 19 I. Evaluation of Borrower Performance . . . . . . . . . . . . . 20 PART III: STATISTICAL INFORMATION 1. Related Bank Loans . . . . . . . . . . . . . . . . . . . . . 21 2. Project Timetable . . . . . . . . . . . . . . . . . . . . . 22 3. Loan Disbursements . . . . . . . . . . . . . . . . . . . . . 23 4. Project Implementation Chart . . . . . . . . . . . . . . . . 24 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.  -2- Table of Contents (Cont'd) Page No 5. Project Costs and Financing . . . . . . . . . . I . . . . . 25 6. Project Financing . . . . . . . . . . . . . . . . . . . . . 26 7. Project Results . . . . . . . . . . . . . . . . . . . . . . 27 8. Economic Impact . . . . . . . . . . . . . . . . . . . . . . . 28 9. Financial Impact . . . . . . . . . . . . . . . . . . . . . . 29 10. Cropping Patterns and Intensity . . . . . . . . . . . . . . . 30 11. Status of Covenants . . . . . . . . . . . . . . . . . . . . 31 12. Use of Bank Resources . . . . . . . . . . . . . . . . . . . 33 13. Missions . . . . . . . . . . . . . . . . . . . . . . . . . . 34 ORGANIZATION CHART . . . . . . . . . . . . . . . . . . . . . . . . 35 MAPS 1 AND 2 . . . . . . . . . . . . . . . . . . . . . . . . 36 and 37 ANNEXES Annex 1 Project Objectives and Description . . . . . . . . . . . . . . . . 38 Annex 2 Procurement of Goods, Works and Services . . . . . . . . . . . . . . 42 Annex 3 Seasonal Rainfall 1981-1989 . . . . . . . . . . . . . . . . . . . . 43 Annex 4 Comments from a Consulting Firm ................. . 44  - i - PROJECT COMPLETION REPORT TUNISIA MEDJERDA/NEBHANA IRRIGATION DEVELOPMENT PROJECT (LOAN 2157-TUN) PREFACE This is the Project Completion Report (PCR) for the Medjerda/Nebhana Irrigation Development Project in Tunisia, for which Loan 2157-TUN in the amount of US$22.0 million was approved on May 25, 1982. The loan was reduced to US$15.3 million following the cancellation, due to the favorable exchange rate of the dollar, of US$5.0 million in .9A6 and US$1.7 million in 1988. The Loan closed on June 30, 1989 and an addi, ..nal cancellation of US$0.839 million was made at that time. The last disbu-.x- nt took place on January 24, 1990. The PCR was jointly prepared by the FAO/World Bank Cooperative Program, the Agricalture Operations Division of the former Europe, Middle East and North Africa Regional Office (Preface, Evaluation Summary, Parts I and III), and the Borrower (Part II). Comments from a consulting firm are attached as Annex 4. Preparation of this PCR was started following a mission to Tunisia in February 1990, and is based mainly on the project completion reports prepared by the two Irrigation Development Agencies responsible for project execution. The PCR is also based on the documents prepared by the Bank, i.e., the Staff Appraisal Report No. 3807-TUN dated April 20, 1982, the Loan and Proje;t Agreements dated June 8, 1982, ani the eight supervision reports. Correspondence between the Bank and the Borrower was not utilized  11ii - PROJECT COMPLETION REPORT TUNISI MEDJERDA/NEBHANA IRRIGATION D)EVELOPMENT PROJECT (Loan 2157-TUN) EVALUATION SUMMARY Objectives The main objective of the project was to incr-~- - .gricultural production by rehabilitating irrigation infrastructure, strengthening extension acti-vities and creating new marketing facilities. In order to attain this objective, the Project, has for both irrigation perimeters: - partially rehabilitated irrigation anddrainage infrastructures (improvement of existing irrigation network over about 500 ha in Medjerda and 500 ha drainage in Nebhana); - improved a total of 200 km of farm access roads; - constructed four fruit and vegetable processing centers; - strengthened the extension services, particularly those which support adoption of improved irrigation techniques; - provided training; and - provided technical assistance by specialized consultants. In the Medjerei, the project has, in addition, financed irrigation equipment for new areas totalling 2,300 ha and construction of four milk collection centers. In the Nebhana, the prrject has also assisted in the rehabilitation of three pumping stations and the construction of a second pipeline of the main distribution system over 16 km. Imalementation Experience In spite of a slow start-up due to lack of local funds, the project was successful in meeting its physical targets; the quiality of works and equipment was generally good. Except for minor adjustments, all project activities we, implemented according to appraisal estimates. The project became operational in January 1983, and works were carried out over a four-year period, from 1984 to 1987. Final works were carried out in 1988 and during part of 1989. In addition to the lack cf funds, three unforeseen factors had an impact on project execution: difficulty in  4v - procuring concrete trapezoidal canals, frequent unavailability of farm land for levelling, and lack of interest of farmers in on-farm modern irrigation systems. Results Overall, the agricultural production objectives were not fully reached. There was not a significant increase in production of open field vegetable crops, cereals, forage and industrial crops. Tree crops, on the other hand, dramatically improved, by almost doubling yields and areas under cultivation. In Nebhana, greenhouse vegetable production also increased considerably, even though cropped areas remained modest. Agricultural production prices clearly improved, leading to stimulating financial results at faria level: family labor wages never fell below TD 11 man/day (year 5), which represents a 40 percent increase compared to year 0, and three times seasonal labor wages. The reduction of the investment program led to an economic rate of return (ERR) of 29 percent for the Medjerda component (38 percent at appraisal) and of 28 percent for the Nebhana component (nearly 10 percent higher than the 20 percent value established at appraisal). The ERR values reached in the context of the project remain favorable in view of lower expenditures and a small overall improvement in prices and agricultural production yields in real terms, which minimized the negative impact of input price increases. Most of the fruit and vegetable processing centers are now operational, although their management has not yet been definitely established. Medjerda milk colleccion centers are also operational and farmers participate in the O&M cost. Extension efforts made are encouraging, particularly in the Medjerda perimeter, with regard to training of extension agents and on-farm extension activities. Extension agents have been almost completely discharged of their routine management activities in order to fully devote their time to farmers' training. Sustainability The positive effects of the project can only be sustained through Government efforts and additional investments. Activities of the project which should be pursued are in the areas of infrastructure rehabilitation in the old irrigation sectors of the Medjerda perimeter, on-farm irrigation improvement by promotion of land-levelling and on-farm modern irrigation systems, extension and marketing. In the context of the Irrigation Management Improvement Project (Loan 2753-TUN), additional funding has been earmarked for preventive maintenance of irrigation infrastructure. However, the transfer of all irrigation activities to the CRDAs, particularly operation and maintenance of irrigation systems, for which they were not previously responsible, needs to be closely monitored in order not to upset the progress which the former Government Agencies have initiated in implementing that project. Lessons Learned The major lessons to be learned from Bank and Borrower joint activities are:  - v during identification of activities related to rehabilitation of old irrigation perimeters, a detailed economic and technical study must be carried out, on which basis it would be decided either to perform limited ad-hoc rehabilitation works or embark on a full-scale rehabilitation program by constructing new networks, for example, thereby considerably extending the perimeter's life (paras. 16 and 52); all accompanying measures linked to project success should be identified at project preparation. In the case of this project, the lack of availability of land for levelling and farmers' access to modern irrigation systems, have constituted foreseeable limiting factors. The same is true for lack of familiarization of the executing agencies with Bank procurement guideline (paras. 20 and 52); when an important institutional change results in the transfer of management and maintenance responsibilities of the project to organizations (CRDAs) not referred to in the Loan Agreement, the Bank should discuss with the Borrower the conditions of this transfer in order to ensure that an acceptable level of net benefits accrues throughout the economic life of the project (para. 41); land tenure issue has been satisfactorily addressed in the irrigated areas under the project (para. 39), but the issue remains in many other areas in Tunisia. Because of the importance of land tenure in motivating the farmers and increasing agricultural yields, the issue of land tenure should be discussed with the Government with a view to adapting countrywide regulations. the decision to centralize regional agricultural activities under the CRDAs makes a lot of sense in terms of organization and decision making process. However, their success will depend on their ability to recruit competent staff and on availability of funds (para. 41).  PROJECT COMPLETION REPORT TUNSIII MEDJERDA/NEBHANA IRRIGATION DEVELOPMENT PROJECT (Loan 2157-TUN) PART I: PRQJECT REVIEW FROM BANK'S PERSPECTIVE A. Progect Identity Name Medjerda/Nebhana Irrigation Development Project Loan Number 2157-TUN RVP Unit EMENA Region Country Tunisia Sector Agriculture Subsector Irrigation B. Proiect Background 1. A primary objective of the Fifth Plan (1977-81) was to achieve self- sufficiency in food. This goal was not achieved since Tunisia's higher per capita income growth and the shift of tastes to higher value crops created a growth of demand in food, diverting exports to local consumption and increasing imports. 2. The overall objective for agriculture of the Sixth Plan (1982-86) continued to be progress towards self-sufficiency in food. Food imports (especially cereals) would be compensated by increasing exports, particularly in the labor intensive subsectors, such as livestock and fruit tree plantations. 3. The irrigated sector contributed significantly to the rapid growth of Tunisian agriculture during the 1970s. In 1980, it accounted for about 25 percent of the country's total agricultural GDP. However, the subsector's contribution could have been higher if more intensive use had been made of the irrigable areas. The Government's objectives during the Sixth Development Plan for this sector were: extension of irrigable areas and intensification of water utilization and crop production on existing irrigable areas. About 38 percent (versus 43 percent in 1977-81) of total planned investments in agriculture during the Sixth Plan period would be allocated to irrigation. 4. Among the loans provided since 1967 by the Bank to Tunisia for agricultural development, seven of these are directly related to projects in the irrigation subsector and three partially related, i.e. Technical Assistance, ASAL I and Rural Roads. Table 1 lists projects related to the irrigation subsector. 5. The Project would (a) help achieve the Government's goal of self- sufficiency through increased production in the Medjerda and Nebhana irrigation perimeters, and (b) increase the efficiency of Government investments by improving the mobilization and utilization of existing water resources in both areas.  6. Agricultural development during the Sixth Plan would also aim at increasing rural emplovment (which was providing 35 percent of tocal employment in the early 1980s against 50 percent in 1972) and agricultural revenues. The use of new technologies, mainly high yielding varieties, fertilizers and chemical weed control, as well as priority investments for irrigation infrastructt're and farm machinery, would constitute the major channels to promote agricultural production, particularly in fruit tree plantation and early vegetable crops which represented the best export prospects. 7. The cultivable area of Tunisia covers 5.2 million ha, of which 235,000 ha (4 percent) are equipped with irrigation. The potentially irrigable land does not exceed 250,'00 ha due to the limited water resources. The area equipped with irrigation v- rs about 110,000 ha of public irrigation perimeters (PPI) and 125,000 ha of . ,- e irrigation consisting of small irrigation units supplied by surface or deep wells. The irrigation intensitv (irrigated area/equipped area) is about 65 percent in the public irrigation perimeters and 85 percent in the private irrigation perimeters. 8. The project is concerned with irrigation development in two areas comprising 35,600 ha, i.e. 30,000 ha in the Lower Medjerda Valley and 5,600 ha in the Nebhana perimeter. 9. Although results have not fully met appraisal expectations, the project has positively contributed to the overall development objectives of the agricultural sector. C. Prolect Obiectives and Description l 10. The objectives of the Project were to increase agricultural production, namely seasonal and off-season vegetables, fruit, forage, industrial crons, livestock and milk in the irrigation perimeters of the Lower Medjerda Valley and Nebhana. 11. In the Medierda, the Project accomplished the following: (a) equipped with tertiary and quaternary irrigation networks the remaining 2,330 ha of private lands not equipped in previous projects; (b) completed the distribution network over about 500 ha, in several small areas where the original equipment was insufficient; (c) improved 104 km of farm access roads; (d) provided fruit and vegetable cold storage centers at El Bathan and Mornag, four milk collection centers (Sidi Thabet, Zhana, Manouba and Mornag) and a fruit and vegetable processing center (in the El Bathan center); Annez 1 gives a full description of the project components in accordance with the Loan Agreement.  .3 (e) provided agricultural equipmant, stores and sheds for agricultural equipment, inputs for the OMVVM and houses for the extension staff; (f) improved extension services of the OM%VM and estabi.ished a training center; (g) provided fellowships and training. 12. In the Nebhana, the project was to make full use of limited water resources and improve water management and distribution in conjunction with the improvement of extension services and provision of a marketing structure. Specific investments have covered: (a) pumping stations at Ain Kebrite, Bled Sisseb and Ain Bou Mourra; (b) increasing the capacity of the main pipeline over 16 km; (c) water distribution and waterflow control equipment; rd) drainage improvement on about 400 ha at Ain Bou Mourra in the Sbikha perimeter; (e) improvement of some 96 km of farm access roads and related structures; (f) the construction of a fruit and vegetable processing station equipped with cold storage at Sidi Bou Ali and the construction of a simple grading and packing station for fruit in Sbikha; (g) improvement of OMIVAN extension services; (h) technical assistance, training and frc -wships for OMIVAN. 13. The Project has benefitted about 3,750 farmers in the Medjerda (in line with appraisal estimates), and 4,650 in Nebhana (versus 4,000 estimated at appraisal). D. Proiect Design and Organization 14. The proiect was designed to continue the following activities which were started for both the Medjerda and Nebhana areas under the Irrigation Rehabilitation Project (1976-80): - complete the rehabilitation of irrigation infrastructures; - continue on-farm development in order to economize on irrigation water; - establish efficient extension services particularly oriented toward on-farm irrigation techniques;  -4- establish a marketing structure to help improve producers' revenues while avoiding the middleman. 15. The project was thus clearly designed with well integrated components and the expected results were in accordance with Tunisia's overall objectives for agricultural development. 16. Altnough the Medjerda component of the Project was well prepared by FAO/CP, the limited approach taken in the area of L.ehabilitation of the irrigation network with concrete flumes is regrettable. The full-scale rehabilitation of old, seriously dzmaged, canal networks (5 to 10,000 ha would have been a realistic objective) should have been envisaged instead of limited ad-hoc improvements over 500 ha only. From a strictly technical point of view, it would be useful if precast trapezoidal concrete canals were definitely banned in the future. Instead, centrifugal, semi-circular canals on precast supports could be used as they have considerable advantages. They last longer, are shock resistant and easy to produce. 17. The two Irrigation Development Agencies (OMVVM and OMIVAN) responsible for project execution were able to successfully carry out the project and to manage and maintain the infrastructures following project completion. They contributed to a large extent to the successful implementation of the project by accepting without any major difficulty the institutional strengthening measures foreseen by the project. The transfer of responsibilities from these Agencies to the CRDAs could have repercussions in the future on the operation and maintenance of the irrigation perimeters (para. 41). E. Prolect Implementation 18. The Loan became effective in January 1983. Irrigation works were d- Ilayed by 18 to 24 months in the Medjerda, and by 6 to 18 months in the Nebhana. These delays were mainly caused by the inadequacy of the preliminary designs which required further detailed studies, budget constraints, and cumbersome administrative procedures, particularly those related to procurement through international bidding. 19. Insufficient Tunisian counterpart funds were allocated for the Medjerda component in 1983 and 1584. This delayed the start-up of that component. The investment budget allocated for that subproject was adequate from 1985 onwards. However, there was a problem for both subprojects of lack of funds to pay incremental recurrent costs and proper monitoring of recurrent expenditures. Lack of recurrent funds in Tunisia and the need to separate the recurrent from the investment budget has been studied in depth by the recent Agriculturel Expenditure Review. 20. Procurement was delayed because of the lack of familiarity of our Tunisian counterparts at the time with the Bank's procurement procedures and by the cumbersome administrative procedures of the Commission des Marches who was also not well informed of the Bank's procurement requirements. The situation has now improved.  -5- 21. On the whole, the project was implemented according to initial plans; the quality of works and equipment was generally satisfactory and even excellent for some components. 22. The main modifications to the initial program are in fact minor adjustments which concern: (a) in the Medierda: equipping of irrigation networks: El Bathan (224 ha) use of low pressure pipes instoad of concrete flumes initially foreseen; 160 ha land levelling (instead of 960 ha), 13 km drains (instead of 33 km), and 360 ha on-farm drainage (instead of 660 ha); irrigation network improvements were extended to 800 ha (instead of 500 ha as foreseen); farm access road improvements were extended to 104,8 km (instead of 102,35 km as foreseen); construction of three milk collection centers (instead of four); provision of 27 tractors (instead of 45); construction of 22 buildings and houses and rehabilitation of eight existing ones (instead of 40); (b) in the Nebhana: the Oued Aich pumping station was not established as foreseen; construction of four concrete reservoirs for daily storage with a total capacity of 11,600 m3 (instead of 14,600 m3 distributed among 11 reservoirs); construction of a second main pipeline over 11 km (instead of 16 km); the recharging of the Old Teboubba aquifer was not done because of lack of water; improvement of 80 km of farm access roads (instead of 96 km); construction of a vegetable processing center at Sidi Bou Ali instead of Sahline; uprooting of olive trees on 55 ha (instead of land clearing on 1,400 ha); 460 ha land-levelling (instead of 600 ha). 23. Project Costs. At appraisal in 1982, the total project cost was estimated at TD 19.91 million (US$39.82 million), excluding the "Agricultural Credit" and the "Incremental Operational Expenses" components. After project implementation, without major changes in the compcnents foreseen in the project, the actual costs were TD 19.51 million (US$23.38 million)', i.e., a saving of 2 percent in dinars and 42 percent in dollars. In view of the favorable exchange rate, $5.0 million was cancelled in 1986 and $1.7 million in 1988 (Table 5 A). 24. About 80 percent of project expenditures financed contracts for works, goods and services. Between 1983 and 1987, 61 contracts totalling TD 15.16 million were managed by the two Agencies. 2 25. Despite initial delays, most of the works were completed by the end of 1987 as foreseen at appraisal. The major delays were caused, first, in the Medjerda, by the need to make minor adjustments following completion of the new irrigation networks in mid-1988, and secondly, in Nebhana, by final works a*t current prices and using the average yearly dollat/dinar exchange rate (wht'ch went from 0.59 D/S in 1982 to 0.95 0/$ in 1989). 2 Aznez 2 indicates contracts by type of bidding and invoestment category.  - 6 - undertaken on pumping stations, storage reservoirs and the Sidi Bou Ali processing center, which were not completed until 1989 (Table 4). 26. Project implementation was affected by four main factors: - lack of local funds: local funds for the start-up of project activities were not available in sufficient quantity during the first y,ar of the project, despite Government's commitment under the Loan Agreement to allocate these funds; - Drovision of traRezoidal canals for the Medierda: Djebel Oust Industries had to reopen the old construction olant for trapezoidal canals, which resulted in an 18 month deiay in the start-up of works; - land-levelline: levelling works did not progress as foreseen. The main constraint was due to the fact that land-levelling can only take place during the short periods between two crop seasons or on the scarce fallow lands. Although land- levelling is crucial for efficient irrigation, it is impossible to force the farmer to do it. Procedures for undertaking levelling operations had been developed under an FAO project (UTFN/TUN/019/TUN: Training and Extension for Improved Irrigation Techniques; 1986 to 1988) through the use of a towed levelling blade provided with a Laser beam system for automatic control. Regular levelling is important to maximize the efficiency of surface irrigation. In Medjerda, farmers were already in debt because of their purchases (through credit) of hydraulic equipment (sprinklers) and were not financially prepared to pay for costly levelling equipment. In conclusion, the Government should become more involved in land-levelling, irrigation techniques and in implementing a water savings policy. Extension efforts should increase co obtain farmers' participation in these programs. Farmers' access to agricultural credit needs to be improved (this is being addressed under the BNA IV project). Paragraph 47 elaborates on these subjects). - siltation of Nebhana distribution system: following the accidental siltation of the pipe distribution network (para. 55), OMIVAN had to focus its efforts on the cleaning out of the pipe distribution system in the irrigation perimeter; therefore, during three to four months, project implementation was not monitored as closely as usual. F. Project Results 27. Agricultural Develogment. Overall, the agricultural production objectives of the project, which had been set at a rather ambitious level during appraisal, were not reached, mainly because of difficulties Tunisia has been having with mArketing and export of early vegetables as well as lengthy delays in the establishment of new extension structures foreseen by the project. One  -7- of the deficiencies in the Tunisia agricultural marketing system identified by the Tunisia Small Farmers Study was the weakness of the cooperative marketing network and interference of Government activities in the marketing, processing and pricing areas. In order to increase the efficiency of agricultural marketing in Tunisia, the study recommends that the Government increase its role in the policy arena by promoting private sector activities and developing and implementing marketing rules and regulations. Under the Medjerda/Nebhana project, it was expected that the cooperatives/private sector would manage the facilities provided by the Project (milk collection centers, cold storaga and processing stations). However, at project completion, only one cooperative was managing the processing center in Sbikha; all other facilities were, until project completion, managed by the Agencies/CRDAs. Marketing efficiency should improve with the transfer to the private sector of the management of the centers. The privatization of collection and distribution activities is being addressed under ASAL-II. To a lesser extent, lack of water in 1985 and 1987 and the liuited development of some techniques (land levelling in Medjerda, on-farm improved irrigation systems in Nebhana) have also hampered development of agricultural production. Only tree crop production increased dramatically under the project, beyond appraisal expectations; in both perimeters, areas planted with trees more than doubled, and yields in Medjerda increased two-fold. Open field vegetable crops more or less stagnated because of marketing difficulties; on the other hand, greenhouse vegetable production in Nebhana has taken off well, albeit on a small scale. The area usually cultivated with rainfed cereals in the Medjerda and provided with supplemental water in the spring has expanded although yields have decreased slightly. Land levelling efforts have clearly not yet given the expected results. Forage crops in Medjerda have stagnated and industrial crops (mainly sugar beet) made some progress over a two to three year period, but were practically abandoned later because of the distance to the sugar plant (B6ja). A. Medierda Perimetar 28. Agricultural Production. Within the Medjerda perimeter which covers about 30,000 ha, the cultivated area increased from 23,350 ha at the beginning of the project (1982) to 27,400 ha at the end of the project. Cropping patterns have evolved as follows: vegetable crops occupied 42 percent of the cultivated area in 1982 and 33 percent in 1989; cereals went from 21 percent to 24 percent, forage from 29 percent to 27 percenit and tree plantations from 8 percent to 16 percent. The following should be noted in particular: - an increase in fruit and vegetable yields from 14 to 16 t/ha; - a dramatic increase in fruit tree yields from 3.4 to 6.7 t/ha, stemming from the conjunction of better on-farm water use, young orchards reaching full development, the impact of extension campaigns, and improved effectiveness of pest and disease control products; - a decrease in cereal yields from 1.3 to 1.1 t/ha, which is not significant because of its link to climatic conditions; irrigation generally takes place only during periods of drought and is inefficient.  - 8 - 29. 1xtension. Until 1988, the relative stagnation of agricultural development was mainly due to the lack of efficiency of agricultural extension agents who were often too much involved in routine management tasks. On th' basis of a reorganization of extension structures and a detailed program of activities established by a Bank consultant, remarkable progress was achieved in less than two years: the extension agents' training program was completed, extension agents were discharged from tasks not linked directly to their function, and programs of intensive visits to farmers were established. Moreover, the irrigation techniques improvement unit, created in 1984, and which was supported by UNDP/FAO in the context of the Bank financed Irrigation Rehabilitation Project, has considerably increased its activities; it is now supervised by three engineers and one technical agent. 30. Fruit and Vegetable Processing Centers and Milk Collection Centers. The use of two processing centers at El Bathan and Mornag is encouraging, as the quantities handled in these centers (5-6,000 t/year) have tripled in three years and their revenues largely exceed their operating and maintenance costs. The same applies to the three milk collection centers at El Bathan, Lezdine and Sidi Thabet which handle 21,000 liters of milk per day. 31. Mechanized Units. Four mechanized units have been established in the Djedaida, Chouigui, Cherchef and Utique sectors of the Medjerda. In addition, the project has improved three units at El Habibia, Lezdine and El Mansoura. The units are equipped with 27 tractors and a wide range of tools. Responsibility for the management of these units will be transferred from OMVVM to the CRDA under conditions which have not yet been defined. 32. Aaricultural Credit. Farmers have benefitted from credit lines of BNT (now called BNA) for the purchase of agricultural and irrigation equipment, fruit tree seedlings and livestock. BNT and OMVVM have also provided short- term seasonal credit. 33. Farm Incomes. The project had a major impact on the small farms (average 1,1 ha); in the "new area", farm incomes increased from TD 1,100 in year zero (without project) to TD 3,100 in year five (with project), while in the "pre-project area" these incomes increased from TD 2,900 (year zero) to TD 4,400 (year five). Wages for family labor increased from TD 8 to TD 11-12 per work day. Annual net income as well as wages for family labor are detailed in Table 6 C (in constant 1989 prices). Table 6 C shows that wages of family labor in Medjerda farms tended to increase according to the size of the farm model, even when a reduction in net income per ha was taken into account. Cropping patterns of the various farm models are shown in Table 6 D which indicates that the cropping intensity is equal or superior to 100 percent for farm models smaller than 5,50 ha; for the others, cropping intensity was lower. All farm models, did, however, benefit from higher cropping intensities starting from year 0. The average cropping intensity reached 94 percent in year five. B. Nebhana Perimeter 34. Agricultural Production. In the Nebhana perimeter which covers about 5,000 ha, the cultivated area increased from 3,990 ha in 1982 to 4,250 ha in 1989. The area planted with trees increased from 790 to 1,600 ha (actual yields of about 5.2 t/ha). The area devoted to open-field vegetable crops tended tc  -9- of 17.7 to 13.3 t/ha, including those of intercropped vegetables. On the other hand, yields of greenhouse vegetables increased from 38 to 56 t/ha with area under production only going from 230 to 310 ha. 35. Extension. Even though some good results have been obtained, particularly by discharging extension agents from routine management tasks, many improvements still remain to be made in this field. In terms of organization, higher numbers of extension agents are needed in the field and an extension coordinator must be recruited. Training of extension agents and field visits for technical discussions and demonstrations could also be considerably increased. 36. Processing Centers. A 1,000 t cold storage facility and a processing center were created at Sidi Bou Ali (instead of Sahline) for fruit and vegetables. A small fruit grading unit was established at Sbikha. The Sbikha Service Cooperative (see para. 27) has been responsible since 1988 for the management and maintenance of this center. For the Sidi Ben Ali Center, a management agreement between the CRDA of Sousse and a service cooperative is currently being negotiated. 37. Farm Incomes. Two farm models were identified in the Nebhana sub- project area, in conformity with the analysis done in the Staff Appraisal Report of 1981. The financial analysis shows that the nec income for a 1 ha farm in the coastal area, specializing in vegetable crops, increases from TD 6,500 in year zero (without project) to TD 8,400 in year five (with project); the net income for a 3 ha farm specializing in tree crops also increases from TD 6,700 in yeet zero (without project) to TD 9,100 in year five (with project). Wages for family labor would increase from TD 22 per work day without project to TD 29 with project (year five) in the coastal perimeter area, while in the fruit growing area (inland), the wages for family labor would increase from TD 16 to TD 22 per work day. Levels of yearly net income as well as wages for family labor are detailed in Table 6 C (in constant 1989 prices). Table 6 C shows that there is no relation between labor wages and the farm model size; this is also reflected in the net income per ha which is higher for the 1 ha than for the 3 ha farm due to intensive production of vegetable crops (partially under greenhous.s). Cropping intensities increased in the Nebhana sub-project area as they had in the Medjerda sub-project. Due to the production of vegetable crops in the coastal perimeters, the overall cropping intensity in Nebhana reached 112X in year 5 (Table 6D). 38. Agricultural Credit. Farmers benefitted from credit lines available from BNT for the purchase of on-farm modern irrigation systems (mainly PVC pipes for on-farm water distribution), and fruit tree plantations. 39. Other Activities. The project also assisted in the development of a nursery, installation of windbreaks on 1,600 ha, purchase of four disinfection units for greenhouses, land consolidation of 1,983 ha in accordance with the agrarian reform law, of which 400 ha have been levelled and 55 ha cleared of old olive trees.  - 10 - G. Project SustainabilitX 40. Sustainability of the project is linked to institutional, technical and economic factors which must be closely monitored in order to reinforce the positive results already obtained. Apart from the Bank's financial intervention, special efforts must now be made by the Government to optimize investment returns. 41. Organization. In March 1989, the Government of Tunisia decided to reorganize all activities of the Ministry of Agriculture by end-1989. The responsibilities of the Agricultural Development Agencies were taken over by the existing Agricultural Development Commissariats (CRDA) in each governorate. The CRDAs would be in charge of the agricultural development of their respective governorate. The new structure is now in place. Changes in financial management and accounting techniques (implying cost recovery and a review of commercial activities) would need to be introduced to reflect the specific requirements of these activities within the context of the CRDA public accounting systems. This would have an impact on the Irrigation Management Improvement Project and would be followed closely by the Bank. A UNDP Technical Assistance Training Project would also help build up the planning capacity at the regional level. The activities of the ex-Development Agency of Medjerda (OMVVM) are now being carried out by six CRDAs, while those of the ex-Development Agency of Nebhana (OMIVAN) have been taken over by five CRDAs. Although it is too early to assess all the consequences of this reorganization, measures need to be taken to ensure efficiency, particularly in management and maintenance of irrigation and marketing infrastructures. There is the risk that the human and physical resources which had been concentrated within the Agencies may be spread too thinly among the CRDAs, preventing them from devoting priority attention to irrigation as the Agencies had done previously. Local authorities will also have more influence on the selection of priority action programs which may lead to possible differences within the various CRDAs. Finally, the impact of the reorganization on the motivation of certain staff of the ex-Agencies should not be underestimated. 42. SECADENORD, which manages the Medjerda-Cap Bon canal, is currently negotiating the take-over of the operation and maintenance of the Nebhana distribution system. Although its future activities have not yet been clearly defined, it should at least be responsible for the entire network of pre- stressed concrete pipes, the Sisseb aquifer exploitation works, as well as pressure control devices. 43. Fundinz made available for the Irrigation Perimeters. Although the uperational budget of the former Agencies is supported by important subsidies and increasing revenues from water sales, funds allocated to infrastructure maintenance remain insufficient. Currently, only preventive maintenance is provided with many shortcomings; much higher funding would be needed to allow preventive maintenance and to forestall the need to have recourse to large and costly rehabilitation programs. The long-term result of such an approach would certainly benefit Tunisia' s financial situation. Some improvement should already result from the actions initiated in 1988 under the Irrigation Management Improvement Project (Loan 2573-TUN), even though tangible results have not yet been obtained under that Project.  - 11 - 44. An engineering study of the irrigation networks was prepared according to which there is an urgent need for major rehabilitation of old sections of the Medjerda perimeter. Urgent interventions should be plannad as soon as possible to keep these networks in operating condition. 45. Suilemental Irrigation. Important efforts should be made to complete irrigation of the Medjerda perimeter. After two rehabilitation projects and despite the efforts of the Medjerda Development Agency, only 50-60 percent of the area equipped in Medjerda is irrigated. A 1990 FAO mission noted this was partly due to water shortages and absenteeism of farmers (this is a land tenure issue partly addressed under the project but still to be tackled on a national level). However, a number of areas are not irrigable because of the degradation of certain tertiary and quartenary irrigation canals. The mission estimated that between 5 to 10,000 ha equipped about 25 to 30 years ago should be modernized (a diagnosis of the situation and rehabilitation of the irrigation systems is being undertaken under the Irrigation Management Improvement Project). Rainfed agriculture is also practiced over about 3,000 ha of state lands which are traversed by the main irrigation canals. In Part II of this Report, the Borrower mentions the present trend toward privatization of state lands could offer an adequate solution for the development of those lands. 46. Imorovement of On-farm Irrization Efficiency. Reduction of water losses by infiltration of water between the hydrants and the irrigated plots can be done by flattening the slope of the plot to be irrigated or by delivering the flow of water as close as possible to the plot in a closed loss free system. The project was meant to promote both techniques but did not produce the expected results for three main reasons: - difficulty in freeing plots for land-levelling purposes for periods long enough to organize large-scale works; - - a simple, fast and economical land- levelling technology adapted to small-size plots was implemented only at the end of the project; in addition, the Laser system used needs a rather complex maintenance service which does not exist in Tunisia; - farmers are reluctant to install modern water distribution systems on their plots (localized irrigation, perforated flexible pipes, micro-sprinklers, etc.). In fact, they do not see the benefit of investing in equipment still costly in Tunisia I to save on water sold at a price that is obviously too low (0.030 TD/m3 in Medjerda, while costs amount to 0.041 TD; for Nebhana, these values are 0.033 TD and 0.061 TD respectively, the latter not including maintenance costs for the main distribution network. 47. Solutions to these problems can and must be found. It is important that the Government and users work together to introduce concrete measures to ensure that net benefits accrue throughout the economic life of the project. 1 Cost estimtes for on-fam equipsent: i) simpUfied PVC locaL systi: 1,000 TD/ha; (ii) locaused irrigation (Bas-Rh6ne type): 3,500 TV/ha; (iii) gresnhouse piiforated pipes: 3,500 TD/ha; (iv) greenhouse drip system: 7.000 TD/ha.  - 12 - In particular, it would be important to: - increase land-levelling units and guarantee maintenance, in particular repairs for sophisticated equipment (Laser type); recover the costs of land-levelling works from beneficiaries and also compensate farmers for crop losses resulting from these works; facilitate the purchase of modern irrigation systems by providing maximum tax exemption on equipment and by improving access to agricultural credit; - pursue a policy of regular water charge increases, which is the only way to reduce consumption of a scarce resource; at the same time, verify and convince farmers that irrigation charges do not represent an unduly large portion of production costs. 48. Marketing. The project provided the means to improve the marketing system for agricultural production and to increase farmers' net benefits. Further efforts are required to ensure efficient management and maintenance of the established structures. This implies the need for strict monitol:ng by the authorities and promotion of independent management by beneficiaries, preferably through cooperatives. It should be noted that by completion of the project, only one cooperative was managing the grading and packing station for fruit in Sbikha (Nebhana); all other facilities provided by the project (milk collection centers, cold storage and processing stations) have until now been managed by the Agencies/CRDAs. The take-over by the private sector of the management of marketing facilities has become even more urgent in the wake of the recent reorganization which saw the transfer of the responsibilities of the agricultural development agencies to the CRDAs. H. Bank Performance 49. From Identification to Appraisal. Following a request by the Tunisian Government that financing be considered by the Bank for a project aiming at complementing and expanding actions initiated by the Irrigation Rehabilitation Project (Loan 1068-TUN), preparatory studies were carried out by the FAO/World Bank Cooperative Program for the Medjerda component, and by consultants (SODETEG - France) for the Nebhana component. The Bank closely monitored this preparation phase and the appraisal mission took place in September/October 1981. 50. Sunermision. In the course of project implementation, the Bank helped to speed up bidding procedures and was generally flexible whenever changes to the loan Agreement were required and/or requested by Government. It also maintained an open dialogue with the Government/implementing agencies during field visits. 51. The eight supervision missions organized by the Bank at regular intervals between October 1982 and March 1988 helped maintain a constructive dialogue with the Government/implementing agencies and to resolve any difficulties.  - 13 - 52. The major lessons to be learned from Bank performance are: - rehabilitation of an old irrigation perimeter (Medjerda in this case), must be considered from a long-term perspective. It is obviously not enough to finance the specific replacement of damaged pipes if other parts still operational during appraisal are going to wear out in the near future. On sections equipped with precast concrete lumes over 30 years ago, no significant improvement can be expected with ad-hoc rehabilitation; only full-scale rehabilitation Iwith a review of basic design must be envisaged, even if this would mean investing as much as for construction of new irrigation systems; - it is not sufficient to recommend a land-levelling program or improvement of irrigation efficiency unless all conditions required for success are met. When the project was carried out, the fact that plots were not made available for land- levelling and the high cost of modern irrigation systems were important limiting factors. I. Bogrower Performance 53. The project was executed very satisfactorily by the ilinistry of Agriculture, mainly due to the existence of the OMVVM and OMIVAN, which were semi-autonomous public agencies operating under the supervisory authority of the Ministry of Agriculture. 54. The Government was fully cognizant of some of the immediate consequences of the reorganization, and thus proposed to entrust the operation and maintenance of the Nebhana pipe distribution system to SECADENORD, which has the requisite experience in this field. 55. The DEGTH has issued new instructions for operating the main floodgates of the Nebhana distribution network in case heavy floods fill up the reservoir which feeds it, and there is a recurrence of the siltation problem experienced in 1987. To limit the rate of siltation, it is, however, recommended to install control devices at the floodgates, maybe even automatic ones to prevent accidents which could occur through human error. In addition, studies have been launched to install an intermediary intake 10 m above the current one, which encourages the formation of cone-shaped silt deposits. Once the construction of this hydrant is completed, the old hydrant would be definitely sealed. 56. Difficulties encountered during the first year of the project stemmed mainly from the lack of local funds which had not been released, probably due to bureaucratic delays. Both Development Agencies experienced management problems in 1985 due to a poor distribution of responsibilities, but this situation was resolved the following year through support from the Ministry. 1S** GERSAR Study under Irrisation Managment Improvement Project (Loan 2573-TUN).  - 14 - 57. The Borrower's actions in areas of land-levelling and improvement of on-farm irrigation efficiency, did not produce spectacular results for the reasons described above (paras 26 and 46). 58. The major lessons to be learned for the future are: - activities of the monitoring and evaluation units need to be planned with care; efforts should be focussed particularly on the selection of agro-economic indicators which are really useful in the assessment af project results and representative of the project area; - the reorganization, i.e. the integration of the ex-Agencies into the CRDAs, could have been introduced over the entire country once the advantages and drawbacks of such a fundamental change had been tested within a pilot region. J. Bank/Borrower Relations 59. Supervision missions played a catalytic role in decision-making at the central level; in addition, they kept central authorities informed of progress being made, and problems encountered during implementation, which could therefore be solved without delay. Some recommendations made by the Bank, particularly with regard to procurement, may have appeared like constraints to the authorities, but were in fact aimed at facilitating project implementation within the framework of the Bank's obligations towards its member countries. K. Consultina Services 60. Medierda. A UNDP project 1 provided the Medjerda Development Agency with technical assistance for provision of training and extension to support development of moderr. irrigation techniques. Thanks to this assistance, a land- levelling method, adapted to conditions in the Medjerda perimeter, was developed and tested. Performance plans for the new irrigation schemes developed in the context of the project were prepared by the consulting firm GERSAR 718.65 man-months). 61. ftbhana. The Nebhana Development Agency used 84 man-months of technical assistance from GERSAR/France, DARUDEC/Netherlands and LAVALIN/Canada. Consultants focussed on the following activities: preparation of tender documents, bid evaluation and supervision of works; strengthening technical training and extension services; promotion of cooperatives and definition of their organization and management. 1 UTYTuNwolenuu.  - 15 - - planning project organization and implementation. 62. With the exception of a consultant from LAVALIN,I the quality of the technical assistance provided by consultants was good and appreciated by the Agencies. L. ProJect Documentation and Data 63. The Staff Appraisal Report 2 was an important reference document which proved useful to the executing agencies and to Bank supervision missions; it was also helpful in writing the PCR. 64. Part of the data included in the completion report had been collected in specific reports prepared by the Irrigation Agencies. 3 Generally speaking, these reports describe in detail the physical results of the project but omit agro-economic results, with the exception of some farm-model budgets provided by OMIVAN. Returns on investments were not estimated for the sub-projects. 65. The economic analysis of this Completion Report is based on agro- economic data collected by the Development Agencies' monitoring and evaluation units, and by information obtained by the completion mission from the Agencies and the Central Planning Directorate of the Ministry of Agriculture. 1 Comments by LAVALIN are attached as Annex 4. 2 Complete English version Report No. 3807-TUN, dated April 20, 1982, as well as French translation of most important chapters. 3 See OMVVM Completion Report (September, 1989) and CF.IVAN Completion Report (December, 1989).  - 16 - PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE A. Comments on the Hedierda Component Data contained in Part III of the Completion Report which refer to the Medjerda component are generally accurate. B. Coments _n the Analysis Contained in Part I The following should be noted: Para. 26 There was no real lack of local funding at the start of the project. Medjerda staff spent the first year of project implementation preparing studies and local and international bidding, and the need for expenses was very much reduced. Local funding during the following years was made available in accordance with project needs as works progressed. Para. 45 The area occupied by state or public sector agencies in the Medierda Valley irrigation perimeter is estimated at 4,614 ha, distributed ". follows: - OMVVM: 1,550 ha (Bordj El Amri farm, SAM, etc.) - Tunisian Farm Society: 742 ha - National Haras: 633 ha - State Land Development Agency: 419 ha Central Cooperative for Selected Seeds and Plants: 305 ha - National Livestock and Range Agency: 603 ha - Miscellaneous: 363 ha Irrigation intensity on these lands is low (compared with the perimeter average) and about 3,000 l are estimated to be rainfed, even though they ire equipped with irrigation p~,pes. The present trend toward privatization of state lands could offer an adequate solution to the development of those lands. Para. 46 - Point 3 Economic factors (equipment cost, water charges) d& not represent the only constraints to the adoption of modern irrigation systems, which are being introduced slowly, particularly in the tree plantation areas. Technical deficiencies (adaptation of equipment to waters carrying silt, types of crops, limited extension in this field, etc.) and commercial constraints (lack of materials and spare parts on the market, neglected after sales-service) also appear to be important constraints.  * 17 - Psra. 52 - Point 1 It is true that there will be a need in the long term to rehabilitate the irrigation network in order to maintain the productive potential of the region. Ad-hoc rehabilitation has, in fact, showed its limitations. A major rehabilitation program will, however, require an important financial contribution from the nation which has already invested 25 years on development of this perimeter. Moreover, various technical. questions must be analyzed in-depth and tests carried out prior to committing the perimeter to a major rehabilitation program. The establishment of a system of regular preventive maintenance operations, as supported under the Irrigation Management Improvement Project, appears to be an adequate medium-term solution to remove current constraints of the irrigation networks. C. Evaluatlon of Bank Performance The Bank's performance was positive during preparation and implementation of the project. The Bank's experts monitored the project intensively, particularly during project preparation, which helped speed up the removal of constraints. The Bank also approved bidding documents in a timely manner through frequent missions to Tunisia. Contractors and suppliers were reimbursed in a timely manner by the Bank, and this helped accelerate the implementation of several components of the project. It would be useful, however, if the time needed for detailed studies and bidding were estimated more realistically by the Bank in the project implementation schedule. D. Evaluation of OMVVM Performance OMVVM was able to: acquire a better understanding of procedures necessary to undertake externally financed projects; organize and train the rehabilitation and maintenance teams for irrigation systems and access roads, and staff of the exrsnsion unit for irrigation techniques; acquire the necessary experience to set up, execute and manage marketing operations, such as the establishment of cold storage units and milk collection centers, which are new activities for the Development Agency, its staff acquired the ability to coordinate multi-purpose ptojects.  18 - Some lessons must, however, be learned for the future: - prior to project start-up, staff of the Development Agencv and beneficiaries should be better informed of, and sensitized to, the content and objectives of the various project components. - a project manager should be appointed on time to plan and monitor the various implementation phases of the project. E. Relations between the Bank and the Azency Relations between the Bank and the Medjerda Development Agency were excellent. F. Comments on the Nebhana ComRonent INTROD.UC=I. The completion report comprises three parts of which Parts 1 _.Ld III were prepared by FAO-CP. Part II reflects the Borrower's perspective with comments on the design and impact of the project and the lessons to be learned from it. It should be noted that the main hydraulic infrastructure works produced the expected results, i.e.: - better distribution of water and waterflow control through installation of pumps, renewal of drilling equipment and establishment of reservoirs; - increase in the quantity of water extracted from che Sisseb aquifer through boring of more deep wells (six new ones) to compensate for lack of water in the dam. Ad-hoc rehabilitation of irrigation network: this was for the installation of new pumps for which works started in April 1989 and not in 1983. Reservoirs and equipment: activities started in October 1985 and not at the end of 1983. Construction of second pipeline: the length constructed was 10.9 km and not 11.02 km. Part III - Table 7 Document: Covenants of the Loan Agreer-snt Section: 3.02 Operation and maintenance of the main distribution system has not yet been transferred to SECADENORD.  - 19 - Document: Covenants of the Loan Agreement Section: 3.07 The last increase in the price of water was 33 millimes and not 30 ml/m3 Document: Covenants of the Nebhana Project Agreement Section: 2.08 (a) A contracu was signed with the agricultural service cooperative S.B. Ali. Document: Covenants of the Nebhana Project Agreement Section: 2.10 In the course of the project, 14 extension staff were recruited instead of 31. G. Comments on the Analvsis Contained in Part I We would like to suggest the following changes and clarifications: - paragraph 26 mentions that there was a lack of local funds, which is not true at least for the former OMIVAN; - siltation of the Nebhana water distribution system in 1987 did not affect project implementation and monitoring; - with regard to agricultural production in the Nebhana perimeters (para. 34), decreases in yields and acreage were due to shortages of water in the dam; - with reference to agricultural credit (para. 32), it should be noted that BNT credits were awarded only for modern irrigation systems (drip, perforated pipe, portable gated pipe) while PVC pipes were financed by the World Bank. ornanizational Set-uD Para. 41: the new organization, i.e., merger of the Development Agencies and CRDAs, is currently being set-up. It is difficult at this time to make an objective assessment of the efficiency of that organization. Para. 42: the transfer of O&M of the Nebhana distribution system to SECADENOR has not yet taken place, and this has consequently affected the 06& of the irrigation network. R. Evaluation of Bank Performance In addition to what is reported in Part I, we would suggest the following: international competitive bidding: in contract award, more preference should be given to local firms; the time interval between bid invitation and Bank no- objection to contract award should be reduced;  - 20 - the Bank should ensure that the best consulting firms are selected in order to avoid problems (as with Lavalin);1 the time required for disbursements made by the Bank should be shortened; establishment of a revolving fund. I. Evaluation of Borrower Performance In addition to the comments made under this heading, the new CRDAs should have the same management flexibility as the former Development Agencies. Staff responsible for project implementation should receive bonuses to reward their efforts. Systematic recruitment of foreign consultants should be avoided: their cost is high (8,000 to 9,000 TD/month) and their involvement does not generally continue after the preliminary design. Supervision of works is carried out by technicians of the Agency. 1 Comnents by LAVALIN are attached as Annex 4.  - 21 - PART III: STATISTICAL INFORMATION Table 1: Related Bank Loans (Irrigation Sub-sector) Loan/Credit Purpose Year of Status Title Approval Loan 1068-TUR Rebabilitation of FY 74 Loan closed in December 1982 Irrigation irrigation and Rehabilitation drainage networks in Project the MedJerda Valley and the Nebhana. Loan 1431-TUN Financial FY 77 Loan closed in June 1984 Sidi Salem participation in a Multipurpose Project multipurpose project including construction of a dam, rehabilitation and construction of irriganed perimeters in the Medjerda valley Loan 1795-TUN Rehabilitation and FY 80 Loan closed in June 1986 Southern Irrigation creation of new Project oases: institutional strengthening Loan 2234-TUN Rehabilitation and FY 84 Loazs closed in December 1990 Central Tunisia creation of new irrigation Project irrigation perimeters; institutional strengthening Loan 2573-TUN Assistance at FY 85 Loan is expected to close in Irrigation national level for 1992 Management improving irrigation Improvement management; institutional measures and reforms aimn at self- sufficioncy of water distribution agencies Loan 2605-TIN Rehabilitation. FY 85 Loan Ls expected to close in Gabos Irrigation expansion and 1991 Project creation of oases; institutional strenghtan6n&  - 22 - Table 2: Prolect Timetable Date planned Date Actual Identification (Bank) 09/80 Preparation (FAO/CP for Hedjerda) 01-07/81 Appraisal mission 09-10/81 Negotiations 3/30 - 4/03/82 Board Approval 05/25/82 Loan Signature 06/08/82 Loan Effectiveness 1 10/06/82 02/01/83 Loan closing date 2 12/31/88 06/30/89 Last disbursement 06/89 01/90 1Lox effectiveness war delayed by throe months to allow the Government to fulLfil all the codtions of the Loan Areement. 2The closing date was delayed six months to alUow financing by the project of ome works bcin completed. particularly In the Nobbana perimter.  - 23 - Table 3: Loan Disbursements Cumulative Disbursements IBRD Appraisal Adjusted Estimates X of actual Fiscal year XLtjmate after cancellation Actual to adjusted estimates -----(US$ Million) --------------- FY83 06/30/83 0.5 0.5 0.3 60 FY84 06/30/84 3.5 3.5 0.9 26 FY85 06/30/85 8.7 8.7 2.2 25 FY86 06/30/86 14.3 9.3 L/ 5.8 62 FY87 06/30/87 18.3 13.3 8.3 62 FY88 06/30/88 22.0 15.3 / 12.0 78 FY89 06/30/89 - 15.3 13.3 87 FY90 1/24/90 14.5 2/ 14.5 100 .1/ Cancellation of US$5.0 million on 5/23/86 2/ Cancellation of US$1.7 million on 1/12/88 2/ Cancellation of US$0.839 million on 1/24/90 Date of final disbursement - 1/24/90  Table 4: Protect Implement.acloa (Chart Appraisal Actual - --- --- Pe-r- P od ------------ Estimate 1983 1984 1985 1986 1987 1988 1989 2/ NEDJERDA 1. New Trrigation ha 2400 2311 50 300---985- 977 Networks --------------- 2. Improvements Irrigation ha 500 800 -140-- 140- 140 140- Network --------180------ 190----190--240- 3. Improvements Access Roads km 100 105 -20-- 20 20- - 20 22- --13-- -1 ---- 28= ------28--- 18-- 4. Processing ceniters U 2 2 2- 5. Milk collection centers U 4 3 -1 1 1 1 6. Extension training program U n.a. n.a. -G__-__-_ 7. OKVVM buildings U 39 30 1/ -24 15- ---- 10 --- _ I NEBHANA 1. Rehabilitation of pumping stations and Sisseb System U 4 3