Morocco - Agriculture Sector Investment Loan

Document of The World Bank FOR OF1FICIAL USE ONLY Report No. 14608 IMPLEMENTATION COMPLETION REPORT KINGDOM OF MOROCCO AGRICULTURAL SECTOR INVESTMENT LOAN (LOAN 3403-MOR) MARCH 30, 1995 Natural Resources and Environment Division Maghreb and Iran Department Middle East and North Afripa Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS Currency Unit Moroccan Dirham (DH4) Appraisal Year US$1.00 = 8.0 DH Implementation average US$1.00 = 8.9 DH Completion Year average US$1.00 = 9.5 DH WEIGHTS AND MEASURES Metric System GLOSSARY OF ABBREVIATIONS AER: Agriculture Expenditure Review ASAL: Agricultural Sector Adjustment Loan BEMC: Budget Execution Monitoring Committee CED: Comptroller of Commitments and Expenditures CGED: Comptroller General of Commitments and Expenditures CMV: ORMVA Extension Centers CNCA: National Agricultural Credit Bank CT: DPA Extension Centers DGF'l'l: Directorate of Land Surveying and Titling DE: Directorate of Livestock DEAR: Directorate of Agricultural Extension and Research DEFCS: Directorate of Forestry and Soil Conservation DER: Directorate of Rural Equipment DPA: Provincial Agricultural Directorate DPAE: Directorate of Planning and Economic Affairs DPV: Plant Production Department of MAMVA DPVCRTF: Directorate of Plant Protection DVRA: Directorate of Extension and Agrarian Reform ENA: National College of Agriculture ENFI: National School of Forest Engineers ERR: Economic Rate of Return FDA: MAMVA's Technology Development Program GOM: Government of Morocco IAV: Hassan H Agricultural and Veterinary Institute ICR: Implementation Completion Report INRA: National Institute for Agricultural Research MARA: Ministry of Agriculture and Agrarian Reformn MAMVA: Ministry of Agriculture and Agricultural Operations M&E: Monitoring and Evaluation MOF: Ministry of Finance MOI: Ministry of the Interior and Information MTASAP: Medium-Term Agricultural Sector Adjustment Program OED: Operations Evaluation Department, World Bank O&M: Operations and Maintenance ORMVA: Regional Agricultural Development Office PERL: Public Enterprise Restructuring Loan PPAR: Project Performance Audit Report SAL: Structural Adjustment Loan SAR: Staff Appraisal Report MAMVA replaced MARA in 1993.  FOR OFFICIAL USE ONLY IMPLEMENTATION COMPLETION REPORT KINGDOM OF MOROCCO AGRICULTURAL SECTOR INVESTMENT LOAN [LOAN 3403-MOR] TABLE OF CONTENTS Page No. PR EFA C E .... .............. ................................... i EVALUATION SUMMARY ....................... ii PART I - PROJECT IMPLEMENTATION ASSESSMENT .1 1. Project Identity ........................... 1 2. Background ......................... 1 3. Project Objectives and Description ......................... 1 4. Project Formulation and Design Considerations .. ......................... 4 5. Project Implementation. ............... ........................ 5 6. Pioject Results and Impact ..... . , r , r e . . . . 6 7, Project Sustainability ............... . 10 8. Bank Performance. . ............ 10 9. Borrower Performance. .............. 11 10. Lessons Learned ............... . . 11 11. Project Relationship.. ............. 11 12. Project Documentation and Data. . ........... 11 PART II - STATISTICAL INFORMATION ............................ . . . 12 Table 1. Summary of Assessments ..... . . ... ..................... .... . 12 Table 2 Related Bank Loans.. ................ 13 Table 3. Project Timetable ............ .................. 14 Table 4. Project Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Table 5. Project Financing . ...... ...... ....................... 15 Table 6. Key Indicators for Project Implementation and Operation ................ 16 Table 7. Total FDA Investments by Category , ............................. 18 Table 8. Total FDA Physical Achievements by Category ...................... 19 Table 9. Studies Included in the Project ......... ........................ 20 Table 10. Comparison of Cumulative and Actual Loan Disbursements .... .......... 21 Table 11. Comparison of Loan Disbursements by Category ..................... 21 Table 12. Reconciliation of Legal Covenants Relating to ASIL ................... 22 Table 13. Bank Resources: Total Staff Inputs ............................. 23 Table 14. Bank Resources: Analysis of Review Missions ...................... 23 Appendixes: A. Mission aide-memoire B. Borrower contribution to the ICR This document has a restricted distribution and may be used by recipients only in the performance of their I official duties. Its contents may not otherwise be disclosed without World Bank authorization. l  I  IMPLEMENTATION COMPLETION REPORT KINGDOM OF MOROCCO AGRICULTURAL SECTOR INVESTMENT LOAN [LOAN 3403-MOR] PREFACE This is the Implementation Completion Report (ICR) for the Agricultural Sector Investment Loan in the Kingdom of Morocco for which Loan 3403-MOR in the amount of US$50 million was approved on September 17, 1991 and made effective on March, 24, 1992. The Loan was closed on June 30, 1994, six months behind appraisal schedule. It was fully disbursed, and the last disbursement took place on May 17, 1994. The ICR was coordinated by Michael Nightingale with input from involved task managers in the Natural Resources and Environment Operations Division of the Maghreb and Iran Department and reviewed by Rene Vaurs, Country Officer, and Rend Costa, Projects Advisor. Analysis for this ICR was undertaken together with Government representatives during Bank missions in October/November, 1994. It is based on material in the project file. The borrower's views are reflected in the ICR and noted in the mission's aide-memoire (30 November 1994).   - ii - IMPLEMENTATION COMPLETION REPORT KINGDOM OF MOROCCO AGRICULTURAL SECTOR INVESTMENT LOAN [LOAN 3403-MOR] EVALUATION SUMMARY Project Objectives 1. The Agricultural Sector Investment Loan (ASIL) was the first World Bank sectoral investment loan to Morocco. It aimed to support a two-year time slice (1991-1992) of Government's total agriculture investment program, estimated at appraisal to be US$640 million. In addition to financing an estimated 8 percent of the program, the ASIL was designed to build on institutional changes initiated under two ASALs in 1985 and 1987, to promote essential policy reform measures aimed at improving the investment process, and advancing key sector policy issues, especially in the livestock and irrigation subsectors. 2. Agreed priority components from Government's investment program were targeted for financing under ASIL; these included developments for: irrigation; area development; crop diversification; forestry; livestock; research, training and extension; agricultural education; and planning. The main part of the investment program was designed to promote the following: better soil cultivation, seed bed preparation and crop management through use of appropriate tractor-drawn farm implements; more efficient small- scale irrigation; improved crop storage; improved livestock production; fruit tree planting as part of crop diversification measures; and land improvement, 3. A second part of the investment program involved sponsoring the Agricultural Development Fund (FDA). This was designed to provide grant assistance to farmers for specific, small-scale investments, selected on the basis of agreed guidelines and aimed at improving current farming techniques and technologies. 4. The package of policy measures and studies supported by the project included: reform of the investment process through streamlined budgeting, speedier disbursement of funds, and better monitoring of expenditures; institutional strengthening through improvement of MAMVA's staffing and structure, and implementation of a system of objective criteria for selection of investments by MAMVA; reforms aimed at privatizing some livestock services and veterinary medicine practices; and improved recovery of irrigation water charges. The studies included: the impact of FDA operations, the execution of the MAMVA budget, and audit of MAMVA project accounts.' Implementation Experience and Results - Summary of Project Achievements 1/ The Ministry of Agriculture and Agrarian Reform (MARA) was reorganized into the Ministry of Agriculture and Agricultural Operations (MAMVA) in 1993; for ease of reference, the acronym is used throughout this report for both titles.  - iii - 5. The project's investment program largely achieved its objectives relating to irrigation improvement, crop production and diversification, forestry, improvement of livestock productivity, crop protection, training and research, and land improvement (Table 6). Analysis of FDA investments shows a distinct swing from small to large loans between 1991 and 1993; this implies that assistance to small farmers and cooperatives declined. 6. Project Costs and Financing. Actual total project costs are estimated at US$442.0 million, compared with the appraisal budget of US$640.0 million. The difference was due to lower levels of local expenditure and slow progress in foreign investments for related developments. Total costs for the main categories were generally below budget, especially for irrigation developments. Expenditures for FDA investments exceeded appraisal estimates. Actual loan disbursements for project activities indicate that civil works and reforestation were one-third higher than budget, while consultant costs were about half of the budget estimate (Table 11). The total costs were financed by the Government and other projects (US$392 million) and the Bank loan of US$50 million - that was totally disbursed. Contributions from beneficiaries for FDA investments amounted to an estimated additional US$113 million. 7. The proiect's policy reform program generated benefits in several areas: long-term privatization plans were implemented for veterinary services and for increasing livestock productivity of cattle and sheep; Government submitted an action plan in October, 1991 for increasing cost recovery for veterinary services, and a livestock sector strategy study was carried out in 1992. Milk prices were fully liberalized. An action plan for water charges was submitted in March, 1992, in conjunction with the Large Scale Irrigation Improvement Project (Loan No. 2656-MOR). These actions, together with the preparation of standard procurement documents were already in progress at the time of loan effectiveness. 8. The study for improving the quality of MAMVA staff was intended to focus on: (i) reducing the number of unqualified, lower level staff; (ii) raising the technical competence of higher level staff; and (iii) developing a career stream. In fact, MAMVA was reorganized without a comprehensive study. This resulted in many of the organizational changes, e.g., forming a single department to link research, extension and training operations and another for rural engineering operations; and creating a monitoring and evaluation system for agricultural operations. While the creation of monitoring and evaluation capacity is good, it is unclear whether the creation of supervisory structures will contribute to raising the efficiency of MAMVA. At the same time, the lack of action for rationalizing staff numbers or improving their technical competence continues to impair MAMVA's effectiveness. As a result, services remain generally inefficient, especially for research and extension, and the high cost of MAMVA operations is being perpetuated. However, both the appointment of a strong Director for the Directorate of Planning and Economic Affairs (DPAE) and the transfer of the role of delegating budget funds to DPAE helped to speed up commitment of funds. 9. The project-related reports were completed behind schedule, mainly due to inadequate interministerial communication and paucity of information. The FDA impact study highlighted the need for improving operational efficiency in terms of productivity, technology transfer, and equity issues. The report process underscored the need for stronger portfolio management, especially between FDA and CNCA. The budget execution study identified procedural issues for improving budget preparation and commitment of funds, procurements, and expenditure of funds; it made proposals for closer collaboration between MAMVA and the Ministry of Finance in order to tackle these issues, and it prepared a Budget Execution Manual. The first audit of project accounts was delayed due to omissions that necessitated a supplementary study; this highlights the need for the Bank to give greater emphasis to the implications of a decentralized government procurement and accounting system when designing a sectoral investment  - iv - loan. The final audit of project accounts was received on time (12/94) and was significantly improved in quality. Project progress reports were generally satisfactory. 10. Procurement performance was fraught with difficulties arising from the fact that the loan was financing expenditures of established lines of Government's investment budget both at central and provincial levels. As a result, there were a large numbers of entities involved. Furthermore, project expenditures were part of the fiscal budget activities for which existing Government procurement procedures were followed. Although the latter were approximately similar to the Bank's procurement guidelines, there were some areas of difference, e.g., public opening of contracts, and procedures for hiring consultants. A study undertaken in the course of the project identified the anomalies and agreed on a common procurement procedure to be followed for Bank-assisted projects. 11. Loan disbursements were behind appraisal schedule throughout the life of the project, due in large part to the lack of a coordinated, inter-ministry accounting system for tracking expenditures, which tended to delay the process of withdrawal requests. This was compounded by the uncertainty of project staff and officials regarding Bank procedures concerning procurement and disbursement for loans involving fiscal budget lines, In order to ameliorate the situation, a workshop was held in Rabat to reinforce Bank procedures, and Bank and Government worked together to implement a system of standard bidding documents for Bank projects in Morocco. However, only partial application had been achieved at loan closing, due to reticence from other sector ministries and the Ministry of Finance. 12. Project risks. Three factors were identified at appraisal which could potentially impede the smooth achievement of the project's major objectives. One concern was the need to ensure timely and adequate provision of counterpart funding; this was countered by specific fiscal budget measures. The possibility of delays in loan disbursements was identified, yet despite the emphasis placed by the Bank on improving budget monitoring procedures and standardizing the bidding process, the problem was not entirely avoided. Other risks concerned the possibility of the entrenched bureaucracy resisting project changes and ignoring stimuli designed to improve its performance. 13. Bank Performance. The project would have benefitted from more detailed analysis of investment performance during Bank review missions. Instead, the emphasis was on policy aspects and implementation of standardized procedures for procurement and disbursement. A total of eight review missions were held (Table 13) - including the procurement training workshop; however, a significant part of the mission time in 1992/3 was spent on preparing and appraising ASIL II. 14. Borrower Performance. For overall implementation, the project would have benefitted from more intensive coordination by the DPAE, both within MAMVA and with other ministries concerned. In general, for aspects where the project objectives were closely shared with the Bank, Government pursued them methodically, e.g., the implementation of a plan for the privatization of veterinary medicine practice and livestock services. Where views on project objectives were less uniform between the Bank and Government, delays were experienced. This indicates a need for more detailed exchanges during preparation and appraisal and for more consistent communication and coordination between Government agencies and between Government and the Bank during implementation. 15. Proiect Outcome. The project is rated as satisfactory. Summary of Findings, Future Operations, and Key Lessons Learned  16. The outcome of the ASIL endorses the merits of a broad based investment instrument linked with policy adjustments. However, it also illustrates the difficulty of pursuing a broad range of policy objectives in the context of the diverse, national investment portfolio for which operational procedures already exist. The experience suggests that the project objectives could have been achieved if the investments had been restricted to components related to the targeted policy adjustments. Other lessons include: (i) the need for more broad based and analytical focus in project supervision; and (ii) the need to develop precise procedures for monitoring development investments. 17. Implementation of the ASIL allowed the Bank to apply its broad experience in investment loans and associated policy design, thereby helping Government to streamline its sector investment program. This, in turn, provided for better focus on priority agricultural investment allocations and for introducing the concept that ensures that investments address specific criteria relating to economic viability, environmental impact and quality effects. Furthermore, Government was able to take advantage of the Bank's expertise in the area of institutional reforms, such as initiating improvements in the efficiency of budget execution and streamlining MAMVA's investment process. The ASIL was effective as a vehicle for initiating reforms on sensitive issues in such key subsectors as land use policy, agricultural education, and livestock, and for helping to consolidate reforms commenced under other projects, e.g., irrigation, forestry, and research & extension. It was less effective in achieving adjustments relating to improving institutional operations. In addition to continuing improvements in investment procedures learned from the ASIL, the policy aspects and proposals contained in the project-assisted studies should be further developed under ASIL II (Ln. 3765-MOR).  IMPLEMENTATION COMPLETION REPORT KINGDOM OF MOROCCO AGRICULTURAL SECTOR INVESTMENT LOAN [LOAN 3403-MORI PART 1: PROJECT IMPLEMENTATION ASSESSMENT 1. Project Identity Project Name Agricultural Sector Investment Loan (ASIL) Loan No. 3403-MOR RVP Unit MNA Country Kingdom of Morocco Sector Agriculture Sub-sectors Agriculture, Irrigation, Forestry, and Livestock 2. Background 2.01 Sectoral context. The Government estimates that 49 percent of Morocco's 25 million people live in rural areas. Agriculture is important in the economy, not only for contributing 16 percent to the country's GDP (trade 16%; mining and industry 25%; services 33%; buildings and transport/communication 10%) but, more particularly, because it provides employment for 40 percent of the labor force and generates 30 percent of export earnings. Of the 28 million ha of agricultural land in Morocco, only 9.2 million ha are cultivable, leaving 18.8 million ha in semi-arid or mountain regions suitable for grazing. Of the cultivable land, some 50 percent receives an erratic rainfall of up to 400 mm per annum, and is restricted to low value cropping systems. The remaining land benefits from good but unreliable rainfall. Some 80 percent of irrigable land, roughly 1.3 million ha is now irrigated. Cereals account for almost 80 percent of the harvested area and 33 percent of the gross value of production. The remaining 20 percent of cropland produces fruit, olives and oil seeds, vegetables and forage. According to statistics collected in 1993, the livestock sector represents 2.9 million cows, 16.3 million sheeps, 4.8 million goats, and 80,000 camels. 3. Project Objectives and Description 301 Project Objectives. The project followed two Agricultural Structural Adjustment Loans (ASAL I, Loan 2590-MOR [1985], and ASAL II, Loan 2885-MOR [1987]) that supported improvements in economic policy. On this basis, the ASIL aimed at improving the efficiency of the Government's investment program in the agriculture sector. It was designed to finance selected priority line items in the Ministry of Agriculture and Agrarian Reform's (MARA/MAMVA)2 investment program for 1991 and 1992 and was accompanied by a series of key policy reforms. 2/ The Ministry of Agriculture and Agrarian Reform (MARA) was reorganized into the Ministry of Agriculture and Agricultural Operations (MAMVA) in 1993; for ease of reference. the latter acronym is used throughout this report for both titles.  -2- 3.02 The allocation of investments under the ASIL was decided on the basis of a detailed Agriculture Expenditure review, carried out by Government and the Bank in 1990, together with extensive analyses and discussion. Historically, Government investment levels were low, due to cumbersome procedures and the fact that funds included in the budget were frequently not available on a timely basis. Investments covered by the program were selected on the basis of a set of criteria agreed upon by Government and the Bank, including: an economic rate of return of at least 12 percent, financial viability for participating farmers, positive environmental impact, and social and human resource development effects. 3.03 The key reforms in MAMVA's investment procedures were aimed at improving the effectiveness of investments as well as fostering Government's emerging policy for providing infrastructure and services to stimulate private sector initiative and improve private sector productivity. Specific reforms included budget execution, project selection and institutional strengthening within the Ministry. To counter weaknesses in MAMVA's investment procedures and the unreliable flow of funds into the agriculture sector, reforms of the investment process were deemed essential to ensure efficient program financing. The main constraints were identified during project preparation and an action plan was adopted (para. 4.02). 3.04 Project Description. The project was designed to be implemented over a two-year period and consisted of the following actions: I. Investment Program. 3.05 The action program for investments involved two parts, the first related to expenditures for development of priority projects, and the second related to grant-aided expenditures through the Agricultural Development Fund (FDA) for individual farmers' developments - mostly involving farm mechanization and irrigation equipment. Project Related Investments 3.06 The project provided financing for the following key activities: (a) forestry component, to improve and manage forestry and other natural resources, including actions for replacing 7000 ha of degraded forest land, for protecting watersheds from erosion, and for strengthening the policies and capabilities of agencies responsible for natural resource management. (b) A livestock production improvement component, to develop an action plan for a detailed veterinary health program, to implement a livestock genetic and nutrition improvement program, and to develop a livestock marketing system -- all oriented to private sector operations. (c) A land improvement component, including a program for updating the national soils map and cadastre, for providing information systems, carrying out topographical surveys and for implementing Government's land consolidation programs. (d) An institutional component, including a program to strengthen MAMVA's organization and management capabilities in the areas of sectoral planning and policy development.  - 3 - 3.07 It also provided financing for developments in the following subsectors, in order to consolidate actions initiated under other projects: (a) A small/medium-scale irrigation improvement component, involving construction, rehabilitation and maintenance of small- and medium-scale irrigation schemes; research and testing of irrigation equipment; and provision of equipment, materials and training for specialist MAMVA staff. (b) A large-scale irrigation improvement component, including construction, rehabilitation and maintenance of 485,000 of large-scale irrigation (LSI) schemes; restructuring LSI organizations; and strengthening operations of the regional agricultural development offices (ORMVA) by implementing a management information system (MIS), and providing equipment, materials and training for ORMVA staff. (c) A crop production and diversification component, including three main programs: (a) for improving organization and technologies for land reclamation and development, range development, infrastructure development, land consolidation and restructuring; and for promoting improved crop rotation practices, development of fruit tree plantations, crop storage, and agro-industrial activities; (b) for enhancing the efficiency of agricultural extension services; and (c) for improving pest control, seed and plant quality, and quality control of agricultural inputs and products. (d) An agricultural trainin2 and research component, including training and research programs and the development and utilization of agricultural labor market information systems. 3.08 The project also supported the Agricultural Development Fund (FDA) through its program for providing grants to farmers, covering set percentages of the costs of specified types of investment, selected on the basis of guidelines agreed between Government and the Bank, and designed to improve current farming techniques and technologies. 11. Policy Reforms. 3.09 To complement the basic investment objectives, a series of policy reforms was introduced. (a) Strengthening MAMVA's budgetary procedures so as to (i) facilitate the availability of budget resources to MAMVA agencies responsible for implementing the investment program; and (ii) improve the efficiency of budget resource use. (b) Agricultural reform programs designed to improve the efficiency of agricultural development through adopting revised policies and applying more timely implementation procedures; (c) Strengthening of the livestock sector: (i) by identifying and granting animal health care zones to private sector veterinarians; (ii) by arranging for associations of stockbreeders to take over responsibility for managing artificial insemination and cattle breeding stations; and (iii) through the liberalisation of milk prices. A livestock sector study was financed to define long-term development strategy.  - 4 - (d) Institutional studies, to improve MAMVA's operations and human resources utilization, as well as to streamline MAMVA's budget procedures and an audit of MAMVA's accounting procedures. (e) An impact study, to evaluate the relative merit of the agricultural development fund (FDA) grant-assisted investment program. 3.10 In addition, project actions included measures for improving the recovery of water charges. This involved intensifying the program, initiated under the Large Scale Irrigation Improvement Project, involving a program monitoring charges for beneficiaries of large-scale irrigation (LSI) schemes, and a program to accelerate the recovery of water charges and to eliminate arrears of payments by water users. 4, Project Formulation and Design Considerations 4.01 Project Origin and Preparation. The proposal for the ASIL evolved from the close collaboration between the Bank and Governient during the review and reshaping of Government's public investment program in the agriculture sector. In particular, ASAL I and ASAL II and the Agriculture Expenditure Review provided a solid foundation for the project, together with the analysis of Government's proposed agricultural investment program. From this basis, ASIL was designed to support MAMVA's 1991 and 1992 investment programs, estimated at US$640.0 million, by drawing on the Bank's experience in investment reviews and investment loans, and to assist Government in implementing a sector investment program, The ASIL thus became a vehicle for the Bank to support broad-based agricultural investments focused on priority subsectors and in the context of specific criteria, such as economic rates of return, environmental impact and quality effects. Furthermore, Government was able to take advantage of the Bank's expertise in the area of institutional reforms, such as improving the efficiency of budget execution, and streamlining MAMVA's investment process. Finally, the ASIL was designed to encourage reforms on subsector issues, such as land use policy, livestock and forestry; as well as supporting further adjustments in strategies relating to research and extension, agricultural education and irrigation operations. 4,02 Perceived Risks. Although both ASAL I and ASAL II improved Government's planning procedures during the mid-1980s, a serious potential constraint, specifically tackled at appraisal of the ASIL -- was the risk of under funding, which had plagued earlier projects. Therefore, actions for ensuring timely and adequate provision of funds was to be ensured under the ASIL by the design of procedures to streamline the preparation and administration of MAMVA's budget. The problem of slow disbursements. experienced by previous projects, was also highlighted during the appraisal mission and the Bank emphasized the need for introducing an efficient project accounting system, standardized bidding documents, and improved budget monitoring procedures. It was further proposed at appraisal to strengthen the agricultural investment selection process by applying a systematic approach to investment programming and by building on the quantitative methodologies for screening and ranking potential projects. At the same time, it was recognized that funding under ASIL was not incremental but provided some assurance for financing key lines of Government's investment program. A risk identified on the institutional side was the possibility of the entrenched bureaucracy resisting project changes and ignoring innovations designed to improve its performance. 5. Project Implementation  5.01 Project Management. MAMVA was responsible for project execution, with the relevant technical departments ensuring planning and organizing day to day implementation of specific components and the Directorate of Planning and Economic Affairs (DPAE) was responsible for overall project coordination. An experienced planning officer from DPAE was appointed as project coordinator and an experienced officer was appointed to coordinate the activities in each technical department. 5.02 The project became effective on March 24, 1992 (six months after Board approval), by which time, the draft budget for MAMVA had been agreed upon and work had begun on the budget execution study. Action plans for improving the recovery of irrigation water charges and for the privatization of animal medicine practice, both of which were conditions for loan effectiveness, were also prepared and agreed upon. Generic procurement documents had been agreed upon and were introduced at the time of loan effectiveness. 5.03 Investment Program. The action programs related to the project description involved nine sub- sectors and, in each one, specific investments were earmarked for ASIL financing. The objectives of these investments are summarized in the Key Indicators for Project Implementation and Operation (Table 6), together with a reconciliation of actual achievements. 5.04 Project Expenditures and Financine. The estimated total project cost is US$442 million, equivalent, compared to the two-year budget of US$640 million - estimated at the time of appraisal. The reason for this difference was the reduction in local expenditures and delays in anticipated foreign aid investments for associated developments. Because of delays in project start up, project investments for the 1991 budget were entirely covered by retroactive financing. This totaled US$29 million, financed from the Bank Loan and US$194 million, financed from the fiscal budget. For 1992, foreign costs financed from the Bank Loan totaled US$31 million, while local expenditures were US$188 million. 5.05 Table 11 provides a reconciliation of actual loan disbursements relative to the estimates at appraisal. On the different categories, loan expenditures on goods and FDA investments were in line with appraisal estimates. However, for civil works and forestry activities, loan financing exceeded appraisal estimates by 40 percent and 30 percent, respectively. Conversely, financing for consultant services and training were only half of the appraisal estimate. 5.06 Procurements and Disbursements Procedures. Despite the fact that DPAE, MAMVA and MOF agreed to implement standardized procurement documents, their adoption was delayed: (i) due to disagreement from other ministries and the central procurement coordination (Commission des marches); and (ii) due to the fact that following the decentralization of MAMVA's operations, it was necessary for all directions and provinces concerned to be fully informed on the procurement procedures. The latter was not done and it caused problems with following up on disbursements. Also, proposed procedures for procuring consulting services were never adopted, and the standard Government system was applied. 5.07 Table 10 summarizes the record of loan disbursements. Problems were experienced with the rate of loan disbursements throughout the project implementation period. This was due partly to the nature of the project, involving financing a number of budget lines, with expenditures frequently involving a majority of the 30 provinces, and partly due to confusion over procedures. Although the Government's administrative procedures were adequate for general fiscal operations, they were not suited to generating the precise information and supporting evidence required by the Bank for disbursements. In particular, for contracts requiring Bank review (i.e. contracts above the threshold specified in the Loan Agreement), supporting documentation needed to be seen by the CED (Contr6le des engagements de depenses). At  - 6 - the outset, the provincial MOF offices were responsible for preparing statements of actual expenditures by budgetary line item. However, due to the decentralized procurement and disbursement procedures, individual contracts could not be isolated and it was, therefore, difficult to reconcile payrnents with contracts that required prior review by the Bank. Furthermore, the finance department of DPAE was responsible for ensuring that the necessary supporting documents were provided. It proved impossible to reconcile these parallel systems, which both contained information needed by the Bank. Consequently, the Bank and Government agreed to implement a system of standard bidding documents which would be distributed directly to the MAMVA departments and organizations concerned in a bid to accelerate the flow of information and funds. However, as this was achieved only at the end of project implementation, it waits to be adopted under ASIL II. 6. Project Results and Impact Physical developments 6.01 Project Investments. The reconciliation of physical achievements, shown in the Key Indicators for Project Implementation and Operation (Table 6) indicates that the subsector investment objectives for project related developments were largely met. However, the absence of monitored information means that it is not possible to assess whether the efficacity of these investments was improved due to the project. For succinct components, e.g., irrigation or forestry developments, it should have been possible for the project operation to have improved the development approach both in a technical sense and by comparison between regions or provinces. By such a procedure, it might have been possible for project actions to have assisted in raising the profitability and sustainability of developments. 6.02 Rural Development Fund. Total expenditures for FDA investments, at US$34 million equivalent, were 25% higher than the SAR budget. Furthermore, lack of records on individual investments made it impossible to determine whether the actions of the project resulted in any improvements in the technologies concerned or in the methods of addressing farmers' needs. The breakdown of FDA investments by category (Table 7) indicates that the largest share invested (DH 93.6 million, or 55 %) was spent on irrigation technology (especially for drilling and equipping of wells), with significant investments in tractors and farm equipment (DH 25.7 million, or 15%), land improvements (DH 9.9 million, or 6%), production and handling of cereal and forage seeds (DH 23.0 million, or 14%), freight for exporting flowers (DH 9.3 million, or 5%), and for livestock production facilities and equipment (DH 5.4 million, or 3 %). 6.03 The analysis of FDA lending shows an increasing trend from "upstream" subsidization of farmers' purchases (en mont - reimbursement of farmers; total 1991:12%; 1993:23%) compared to "downstream" subsidization (en aval reimbursement of traders; total 1991: 88%; 1993: 77%). Possibly, this trend indicates a shift to increasing assistance to larger farmers and, in view of the significant amounts of subsidy involved, it is important to have a detailed analysis of the types and amounts of components to be assisted by the FDA. Assistance under the FDA is valuable for encouraging a fledgling industry, like freight for exportation of flowers; or for encouraging the adoption of new technologies, e.g., in crop and livestock production. The initial selection of FDA assistance should depend on clear evidence that the technologies involved are financially viable and, therefore, once the techniques have been established, there should be a clear mechanism for phasing out subsidies. This would transfer the process to normal market forces, while FDA would select and adopt other technologies for promotion through short-term subsidy assistance. The development of a more precise review system will be a priority for ASIL II.  - 7- Policy and Institution Reform Program 6.04 The proiect's institutional reform program highlighted completing the reorganization of MAMVA, a process that commenced under ASAL II. The ASIL included funding for a study to define the services to be provided by MAMVA through the year 2000, to examine the organizational structure, and to make proposals for raising the productivity of Ministry staff. This was to be achieved through: (i) reducing the overstaffing at lower levels; (ii) increasing numbers and quality of technical and professional personnel at higher levels; and (iii) developing a technical career stream. It involved renaming the Ministry to become the Ministry of Agriculture and Agricultural Operations (MAMVA). In principle, this reorganization realigned some of the technical departments to better suit them to their task. 6.05 In the event, there was no comprehensive study and the reorganization of MAMVA, that occurred in 1993, resulted in the creation of: (i) a supervisory department for rural engineering, aimed at strengthening operations in irrigation, water management, equipment, and land consolidation and development; (ii) a department for organization of farmers; (iii) a division for monitoring and evaluating MAMVA developments, with a cellule in each technical department; (iv) a personnel management department; and (v) a council for organizing sector studies and strategy formulation. At the same time, the coordination of research, training and extension operations was brought together into a single department. However, in the process of absorbing the extension division from the previous Extension and Land Reform Department, many of the experienced staff were lost (through promotion or transfer) and MAMVA's ability to develop an effective extension service was weakened. 6.06 Theoretically, the personnel management department should be able to resolve the complement and training needs. However, no significant reduction in numbers of personnel has occurred to date and there is no clear strategy for raising the quality of technical personnel. The lack of action to reduce the number of lower level, unqualified staff impinges directly the standard of field staff and is stalling essential improvements in research and extension operations. Proposals for the creation of a technical career stream have been completed by MAMVA; however, implementation of the proposals is stalled by central civil service review. It is hoped that the reorganization of MAMVA line agencies that was initiated in 1993 will be further consolidated under ASIL II. 6.07 Reforms in MAMVA's investment process. The streamlining of MAMVA's investment operations was a key objective of the project. This was achieved as part of the MAMVA reorganization in 1993 A computerized budget monitoring system was developed and introduced by DPAE in 1993. This was supported by a ministerial note from MAMVA detailing the procedures and timing for budget monitoring activities. This is complemented by support from the MOF which is required to provide timely information on the status of loan disbursements. The new procedures are proving effective: for 1994, the system accelerated the preparation of the budget. In addition, the follow-up procedures provide the means for monitoring progress of expenditures at provincial level; however, these will need to be strengthened both in MAMVA and MOF during implementation of ASIL I1. 6.08 MAMVA, along with most other ministries, suffered from severe constraints on its 1992 budget. The uncertainty of adequate funding delayed the timing of the investment reform program; consequently the efficiency of investment planning, organization and monitoring remain rather weak. 6.09 Livestock sector reforms. Long-term privatization plans were established for veterinary services, leading to a projected coverage of over 70 percent of cattle and 50 percent of sheep by the year 2000. The Government's action plan of October, 1991, undertook to implement a program increasing artificial  - 8 - insemination and bull stations by transferring these activities to herders' associations. The realizations in terms of artificial insemination improved by approximately 32% between 1991 and 1993, increasing from 45,850 to 60,250 operations. At the same time, at cattle breeding stations, they increased from 15,800 servicing in 1991 to 22,600 in 1993. A livestock sector strategy study started in 1992, and was completed in May 1994. This strategy analyzed key livestock systems, development of animal production and result of achievements and, finally, defined the key lines for livestock production and measures to be taken in the short and long term for a harmonious development of this sector. The liberalization of milk prices was among the adopted measures; it came into effect in February 1993. A further achievement, within the liberalization of foreign trade, was the introduction of a new system for the pricing of imported livestock food, for instance corn and crab, in order to reflect world prices. 6.10 Irrigation water charge recovery. An action plan for improving the monitoring of large-scale irrigation charges and for improving the recovery of irrigation water charges was prepared and submitted to the Bank on March 24, 1992. These plans built onto changes initiated under the Second Large-Scale Irrigation Improvement Project (LSII 2, Loan 3587-MOR); to date, there has been only slow progress in enforcing user charges at levels sufficient to cover operation and maintenance costs. Project Related Studies 6.11 All of the project related studies were delayed, partly due to the absence of monitoring systems and the consequential protracted processes for obtaining information from the relevant agencies, but also due to miscellaneous logistical and communication problems. Nevertheless, the three major studies were significantly completed by the end of the project, which indicates a recognition on all sides of the importance of the project's objectives. 6.12 Budget Execution Study. The budget execution study was designed to identify key issues relating to the execution of MAMVA's investment budget, as well as the subsequent commitment and expenditure of funds, and to coordinate procurement procedures. It was also intended to research and prepare a budget execution manual with the objective of promoting closer collaboration between MAMVA, MOF, the Tresorie generale, and the Contr6le des engagements et depenses. The study was completed in April 1994 and a more analytical control system was introduced for 1995 operations. Training for accounts personnel at all levels was initiated in August 1994. Actions under ASIL II will focus on improving the monitoring and the flow of documents through administrative channels, in order to simplify procedures and improve efficiency. 6.13 FDA Impact Study. The FDA impact study was originally a condition of project effectiveness for the ASIL. It was intended to specify the types of investments that would be eligible for FDA funding and to enable Government to analyze the types of farmer beneficiaries, in order to judge the effectiveness of the program. The study was carried out by KLONIC Morocco, and it experienced frequent delays due to lack of coordination and difficulties in obtaining information, notably from CNCA. Scheduled at appraisal to be submitted to the Bank by December 31, 1992, study results were not transmitted until July, 1993, after having been made a condition for appraisal of ASIL 11. The final report drew several conclusions concerning the effectiveness of FDA in terms of increased productivity, technology transfer, and income distribution. There was strong resistance to employing international consultants to assist with the studies. Had this not been so, the FDA study might have had more comprehensive analysis - drawing on experience from similar organizations in other countries.  - 9 - 6.14 Several issues concerning the decision processes and implementation of the FDA grant program will be followed up on under ASIL 11. These include: a) the need to develop a permanent monitoring system of FDA investments to ensure that the following basic selection criteria are respected: (i) finance for new technology, (ii) promote positive externalities, (iii) emphasize privatization of agricultural services, and (iv) benefit small farmers; b) the need to define terminologies, such as. "new technology" and "small farmers", more precisely, in order to prevent repeat investments by the FDA; and c) the application of ceilings for both the total amount of FDA financing to be received by an individual and on the number or amount of each type of investment to be financed. The establishment of a permanent monitoring system was achieved in 1993 and should be of direct benefit to ASIL 11 operations. 6.15 Progress Reports. Two types of annual progress reports on the project were prepared by DPAE, covering overall developments and details of FDA investments. The reports concentrated on physical developments, but were generally of good quality and informative 6.16 Audit Reports. The first audit report of project accounts was due June 30, 1991, but was submitted to the Bank in December, 1993. However, the auditors did not examine the individual invoice records (pieces justificatives) required for payment of expenses incurred. In order to rectify this, the Bank requested submission of a more comprehensive audit as one of the conditions for negotiating a loan for ASIL II. This necessitated a supplementary audit, the results of which were transmitted to the Bank on April 15, 1994, and accepted. The difficulties experienced in auditing routine Government accounts highlight the need to be sensitive to governmental systems in the design of sectoral investment loans and to maintain close liaison. The final audit report on project accounts, received by the Bank in December 1994, was comprehensive and satisfactory. Economic Returns 6.17 Due to the nature and scope of the ASIL, no meaningful calculation of the project's economic rate of return is possible. However, during implementation of ASIL II greater attention should be given to assessing the ex-post economic viability of different types of investment compared with the estimates contained in investment analysis forms used at the planning stage. Environmental Impact 6.18 Project actions were reviewed at appraisal and were not anticipated to pose significant environmental problems. MAMVA took the initiative in 1993 to create a special section that is charged with identifying potential environmental hazards and proposing corrective actions. Establishment of a system for monitoring the environmental impact of MAMVA's investments should be followed up on under ASIL II, as an integral part of the system for assessing individual investment propositions. 7. Project Sustainability 7.01 A transparent and progressive budgetary process is paramount to achieving project objectives. Budget cuts, such as were experienced in 1992, jeopardize MAMVA's ability to implement coherent development programs, to improve the efficiency of its investment process, and to support reforms in the budgetary process. Since 1994, MAMVA's streamlined budget procedures have been decentralized, with  - 10 - each technical department preparing proposals that are coordinated by DPAE into an aggregate budget for MAMVA. Because of serious finance resource constraints, since 1994, the Ministry of Finance has imposed severe cuts in all ministries' budgets. This has occurred in several projects, irrespective of legal commitments in project agreements. In this context, the provision of funds for ASIL I operations in 1994 were reduced after establishment of the budget. Greater attention should be given to establishing precise budget resource availability before making any loan or project commitment. 7.02 The ASIL's institutional development component was designed with clear, monitorable targets which could be closely supervised during implementation. Nevertheless, some resistance was encountered, especially with respect to audits and the FDA impact study, both of which suffered from poor inter- ministry communication and the paucity of information in various Government agencies. Furthermore, the degree of delegation that exists from the central MAMVA departments to provincial departments was underestimated at appraisal. Although this is commnendable, it meant that some of the project's institutional objectives were oversimplified and, therefore, were not fully realized during ASIL. 8. Bank Performance 8.01 The World Bank performance during project implementation was satisfactory, although the project would have benefitted from greater regularity and focus in formal review missions. Successive Bank review missions tended to focus on macroeconomic aspects and implementation of standardized procedures for procurement and disbursement; whereas greater attention should have been given to physical development achievements. A training workshop was held in September 1992 in order to familiarize MAMVA personnel with the Bank's procurement procedures. Supervision missions occurred at the rate of one per year in 1991, 1992, 1993, four in 1992, and two in 1994 (Table 14). However, a high proportion of Bank Mission time in 1992 and 1993 was diverted to preparation and appraisal of ASIL II, which might have reflected on ASIL performance. 9. Borrower Perfonnance 9.01 All aspects where the project objectives were considered important by both the Bank and the Government were pursued methodically. An example is the development and implementation of an action plan for the privatization of veterinary medicine practice and some livestock services. Where project objectives were not considered with equal importance, problems and delays were experienced. This is particularly true in the case of standardized procurements, the audit report and FDA impact study, which all experienced delays. The confusion in the audit process illustrates the need for increased communication and coordination during preparation and implementation, both between Government agencies and between Government and the Bank. Similarly, the lack of coordination experienced during the FDA impact study was significant because the FDA represents 5 percent of MAMVA's investment budget, and it also received some 37 % of ASIL investment financing. Consequently, the Bank attached great importance to the timely execution of the impact study and to implementation of study conclusions. Nevertheless, delays were experienced, especially in obtaining necessary information from CNCA and in completing the study, which was transmitted to the Bank in July, 1993. Although both Bank and Government are in agreement as to the study's importance, closer coordination with CNCA and with project officials is important for effective monitoring of project progress. 10. Lessons Learned  - 11 - 10.01 The project performance experience illustrates the difficulty of pursuing several different objectives, particularly in the context of such a diverse portfolio of projects. The experience indicates that by concentrating on investments related directly to the targeted policy adjustments, the project could have better achieved its objectives. Other lessons include: (i) the value of focus and continuity in project review missions; and (ii) the need to increase efficiency of the budget monitoring process. 11. Project Relationship 11 01 The relationship between the Bank and the Borrower, represented by MAMVA, the Ministry of Finance and the Ministry of Economy, was a partnership at all times and the relationship between Bank staff and project staff was consistently constructive. 12. Project Documentation and Data 12.01 The involvement of project authorities in the project's preparation and the fact that the general principles and objectives of the project were well understood by all officials concerned, greatly contributed to the understanding of the Staff Appraisal Report, which proved a useful guide during implementation. At the same time, the paucity of data on the impact of project activities, which should have been produced by an efficient monitoring and evaluation system, makes it difficult to carry out a complete project impact analysis. The final audit report was received in December 1994. m:\maroc\asil l\asil I icr .all  - 12 - IMPLEMENTATION COMPLETION REPORT KINGDOM OF MOROCCO AGRICULTURAL SECTOR INVESTMENT LOAN (LOAN 3403-MOR) Part II: STATISTICAL INFORMATION Table 1. Summary of Assessments A. Achievement of Obiectives Substantial Partial Negligible Not Applicable (x) (x) (x) (x) Macro policies O 0 D F Sector policies 0 Di D O Financial objectives 0 I i a I Institutional development 0 D O] Physical objectives O0 i O I Poverty reduction II n o Gender issues O 0 0I 0 Other social objectives E Li] n] Environmental objectives L] 0 DI Public sector management n 0 oI Private sector management 29 noI Other L] Ci O O B. Proiect sustainabilitv Likelv Unlikely Uncertain 0 Ei FDI Highly C. Bank performance satisfactor Stisactory Deficient Identification Di 0 O Preparation assistance Ui 0 1D Appraisal Di 0 a Supervision lO D 0 Hiphly D. Borrower performance satisfactory Satisfactory Deficient Preparation D 0 0i Implementation D 0 Di Covenant compliance 0 0- i Operation E l 0 Highly Highly E. Assessment of outcome satisfactorv Satisfactory Unsatisfactory unsatisfactory 3i 0 a o  - 13 - Table 2. Related Bank Loans Loan\credit title Purpose Year of approval Status Loan 1602-MOR Improve rural income and sociaL well- FY78 Closed 6/30/90 Fes-Karia-Tissa Project being of 33,900 farm families in the project area through improvements in research, extension services, credit and input suppLy, as welt as through investments in infrastructure such as roads, schools, heaLth faciLities, and water supply. Loan 2082-MOR Increase production of meat, miLk and FY82 Closed 12/31/90 MiddLe AtLas-CentraL Area cereals; increase rural population AgricuLturaL DeveLopment and employment; reverse environmental Project deterioration of forest and rangelands. Loan 2253-MOR Support development of small and FY83 Closed 12/31/92 Small and Medium Scale medium scale irrigation subsector Irrigation Project I through creation/rehabilitation of five schemes and preparation of second-stage project. Loan 2367-MOR Increase agriculturaL production by FY84 Closed 3/17/87 Fifth Agricultural Credit increasing agriculturaL lending of Project CNCA. Loan 2590-MOR Support first implementation phase of FY85 Closed 12/31/87 AgriculturaL Sector Government's five year sector Adjustment Loan I adjustment program. Loan 2731-MOR Increase agricultural production by FY87 Closed 3/31/90 Sixth AgricuLturaL Credit increasing agricuLturaL Lending of Project CNCA. Loan 2885-MOR Support second implementation phase FY87 Closed 4/1/92 Agricultural Sector of Government's medium-term Adjustment Loan II agricultural sector adjustment program, foster efficient agricuLturaL growth, contribute to reduction of budgetary/capital account deficits while minimizing social costs of adjustment. Loan 3036-MOR Support reorganization and FY89 Ongoing Research and Extension strengthening of nationaL research Project system and impLementation of T&V extension. Loan 3088-MOR Finance CNCA activities from 1990- FY90 CLosed 12/31/93 Seventh AgricuLtural 1993. Credit Project Loan 2954-MOR Increase agricultural production FY89 Ongoing Second Small and Medium through rehabiLitation of small- Scale Irrigation Project medium scale irrigation schemes. Strengthen institutional capabili- ties relative to rehabilitation, operation and maintenance of such schemes. Loan 2217-MOR Improve living conditions of ruraL FY83 Closed 06/30/92 Oulmes-Rommani population & ruraL development Agricultural Development through increase of agricuLturaL & Project livestock production in rainfed zones & irrigation perimeters, improve social & agr. services. Develop forest resources by improving siLvicuLturaL, harvesting, management techniques, integrating livestock & forest prod., providing 1 soil protection & erosion control. I  - 14 - Table 3: Project Timetable Steps in project cycle Date pLaned Date actual Identification (Executive Project Summary) 5/16/90 Pre-Appraisal 5-6/90 AppraisaL 9-10/90 Negotiations 5/6-10/91 Board presentation 1/91 9/17/91 Signing 10/25/91 Effectiveness 1/23/92 3/24/92 Project completion 6/30/93 12/31/93 Loan cLosing 12/31/93 5/17/94  - 15 - Table 4. Project Costs* A-ppraisal estimate (USSM)* Actual (USS1)* Local Foreign Local Foreign Ita costs costs Total costs costs Total Small-scale irrigation 26 17 43 35 Large-scale irrigation 197 154 351 183 Crop production 30 11 41 47 Extension 13 8 21 15 Forestry 31 13 44 34 Livestock 20 10 30 28 Plant protection 8 5 13 _ 12 Education 12 8 20 | 17 Research 9 10 19 16 Technology development (FDA) 17 10 27 34 Planning 3 4 7 5 Land policy 14 10 24 16 TOTAL 380 260 640 265 177 442 Table 5. Project Financing* .__________________ _ RWAppraisal estimate (USSR) Actual (USSR) LocaL Foreign Local Foreign Source costs costs Total costs costs Total Government 237 153 390 232 Other donors 74 56 130 100 WB, excluding ASIL 40 30 70 60 WB, ASIL 29 21 50 50 TOTAL 380 260 640 265 177 442 * Reconciliation of total investments by MAMVA in 1991 and 1992. ** Exchange rate (average 91/92) DH8.6/US$1.0 *** Except for IBRD which is actual, these figures are estimates (pending provision of detailed figures by MOF).  - 16 - Table 6. Key Indicators for Project Implementation and Operation Key operating Appraisal Target ActuaL indicators in SAR (a) SmaLL- and Financing of the foreign exchange element 6,000 ha constructed in coordination Mediun-Scale of various activities, including with specific SMSI projects (SMSI I and Irrigation construction of 3,000 ha SMSI works/year; 11, Loan nos. 2253-MOR and 2954-MOR); (SMSI) feasibility/design studies; completion of SMSI improvement in Saharan provinces; Improvement major works on Neckor Irrigation Scheme. repair and maintenance of SMSI schemes; feasibility studies for tranche 11 of SMSI 11 Project; TopographicaL studies of 14,000 ha; irrigation water tariff studies for Loukkos, Gharb, TadLa, Doukkala, Moulouya; purchase of laboratory and hydrauLic equipment. Delayed start up of Neckor Irrigation Scheme prevented compLetion proposed development. (b) Large-Scale RehabiLitation of infrastructure and Provision of equipment and Irrigation (LSI) equipment in aLL ORMVAs except MouLouya; rehabilitation of 28,000 ha; Improvement quick implementing, minor rehabiLitation of consolidation works on 83,000 ha in LSI schemes; major rehabilitation works in Gharb and DoukkaLa; equipment and DoukkaLa (Faregh) and TadLa (Beni Amir); maintenance of putmping stations; construction of new SMSI systems. equipment of 1,140 ha in Ouarzazate; improvement of irrigation works in Beht, Beni-Moussa and Tafilalet; provision of electric, automatic and hydraulic equipment for development of Boulaouane; rehabiLitation of roads in Tadla and Loukkos; studies for improvement of over 100,000 ha in Gharb and 220,000 ha in TadLa; impLementation study in Loukkos (20,000 ha); consolidation works in Loukkos and Doukkala; pastoral improvement and desertification prevention in Tafilalet and Ouarzazate; improvement of 10,500 ha in Loukkos. (c) Crop Production/ (i) DPV program for land development, (i) DPV AgricuLtural development Diversification improved approaches to construction of projects covering nearly 2 miltion ha, infrastructure, reestablishment of date including: Oulmes-Romani Project, 700 palm plantations in Ouarzazate/ Tafilalet, ha of soil conservation works; Settat continuation of 35,000 ha pilot land Project, improvement of 500 ha of paths, consolidation project, field studies to elimination of 1,650 ha of jujube, and extend project by 60,000 ha, and maintenance of 50 km of ruraL roads; development, including conception/execution Abda Project, construction of 375 ha of of land consolidation program for 500,000 banquettes, planting of 600 ha of olive ha long-term program scheduled for 1993; trees, and pastoral improvement of 340 (ii) DVRA program for 3,000 ha of semi- ha; Had-Kourt-Ouezzane Project, 860 ha mechanical land destoning; (iii) fieLd of soil conservation works, pastoral studies, including improvement of terms and improvement of 150 ha; Ghiss Neckor conditions of employment for extension Project, distribution of 27,000 fruit staff; and (iv) DVCTRF program for plants; free distribution of 41,000 date acquisition of protective equipment, palms in Ouarzazate, Tafilalet, Tata, laboratory/technical equipment, modern safe Figuig, GueLmim, Tiznit and Haouz, appLication equipment for research, seed distribution of oLive trees and certification, pest controL (no maintenance of oLive plantations in pesticides), and monitoring associated mountain areas, promotion of improved imports. species of cereaLs, forages and vegetables; (ii) field studies in Fes- Karia-Tissa (354,000 ha), Meknes (216,000 ha) and Khemisset (540,000 ha); agroeconomic study of Khenfira (370,000 ha) and BensLimane (260,000 ha); field studies covering 50,000 ha in Fes, Benslimane, Khemisset and Settat; further field studies covering 17,000 ha in Fes, Tetouan and Khemisset; land consolidation works in Taza (10,000 ha) and Khemisset 10,000 ha); and (iii) l _____________________ ___________________________________________ purchase of equipment.  - 17 - Key operating Appraisal Target Actual indicators in SAR (d) Forestry Preparation of forest management plans PLanting of 2,384 ha with similar to Forestry 11 Project, planting of eucalyptus/pine trees; execution of eucalyptus/pine trees on 7,000 ha of forest resource inventory; 1,068 ha of degraded plantations/scrubland; forest improvement, treatment of 6,230 construction of fire-breaks and forest ha; regeneration of 4,753 of natural roads. forests; production of 50 million pLants; free distribution of 1.3 million pLants and fixing of 258 ha of dunes to combat erosion; planting of 100 ha of fruit trees and treatment of ravines to improve hillside basins; construction of 42 radio posts and installation of electricity in 30 forestry buildings; genetic improvement program for forestry plants; research programs for various species of trees; inventory and study of Local flora and fauna. (e) Livestock Execution of livestock strategy studies; Vaccinations realised under PISA I are Improvement provision of laboratory/technical equipment the following: vaccination of for Government's animal health program; approximately 11 million sheep against inputs for vaccination campaigns; funding sheep-pox(covering 75%), vaccination of and provision of equipment for genetic 800.000 sheep and cows against anthrax improvement and animal feeding programs and in coal areas,vaccination of 190.000 rehabilitation of priority rangelands. veals against brucellosis (covering 73%),vaccination of 1.988.750 sheep against enteritis in mountainous areas, treatment of 500.000 sheep against internal parasitic and 5 million mixed breed against external parasitic, fight against rabies by killing wild dogs, strengthening of sanitary controls of exported animal products, undertaking of 45.850 artificial inseminations for miLking cows in 1991 and 53.490 in 1992; 15.800 and 16.000 coverings were carried out in 1991 and 1992 respectively in cattle breeding stations,the average rate of financing of these programs by PISA is 13% for 1991 and 1992; financing of 23.230 of cattle, sheep and camels as part of genetic breed improvement through FDA for an amount of 13,89 million DHS; management and accounting training for local cooperatives; planting of 290 ha of forage crops in Ait Zekri; pilot actions to combat draught; provision of 320,000 tons of food for animal feeding program; exemption from import taxes for animal feed; assumption by government of transportation costs for animal feed. (f) AgricuLturaL Purchase of teaching equipment identified Completion of 1986 restructuring of Training/Research during Agriculture Expenditure Review; agricultural teaching program; 808 consultancy services to support DEAR higher degrees awarded in 1992; planning activities. provision of infrastructure and teaching equipment; training program for MAMVA personnel; institution of a job competency training program;organization of workshops in conjunction with FAO, INRA, and UNICEF; study of professional associations and rural cooperatives in the ORMVAs; training of extension staff, installation of 3,000 demonstration kits; creation of 54 cooperatives, totaling 2,261 persons; studies and surveys on improvement of land policy; provision of potable water to ruraL cooperatives.  - 18 - Key operating Appraisal Target ActuaL indicators in SAR (9) Land Surveying! Investments for more efficient use of Opening of regionaL cartographic service Titling agriculturaL Lands; mapping and in Agadir, topographic service in topographicaL work for Land consoLidation/ CasabLanca and construction of cadastraL surveys. topographic service in Tangier; construction and land conservation works in SaLe and five provinces; acquisition of Land for construction in four provinces; estabLishment of 63,633 Land titles and 214,534 property deeds; survey of over 27,500 ha; cadastraL survey of roughly 13,000 ha; nearly 8,000 ha of topographical works; four urban plans; 100 topographic maps; 4 marine maps; 4 general maps and 7 specialized maps; carrying out of land l__________________________________________ inventory. (h) Planning ConsuLtants and studies to improve Execution of FDA impact study and budget agriculturaL pLanning and poLicies, execution study; deveLopment of a including agroeconomy, agricultural medium-term agricuLturaL development policies, monitoring of Plan pLan; evaluation studies of Fes-Karia implementation, project M&E, FDA impact Tissa and SMSI Projects; implementation study, budget execution study. of pilot monitoring and evaLuation system; studies on LiberaLization/ protection of agricuLturaL products, cereal prices, agricultural policies, MIS, and fruit and vegetable commercialization. Table 7. Total FDA Investments by Category Category Amoumt (DH'OOO) | of total Irrigated agriculture 89,525 52.9 Land improvements 9,917 5.9 AgricuLturaL production equipment 25,653 15.2 Cereal seed production 19,534 11.5 Air freight 9,306 5.5 Plant acquisition 6,278 3.7 AnimaL production intensification 5,447 3.2 Forage Seed use 3,502 2.1 TOTAL 169,163 100.0  - 19 - Table 8. Total FDA Physical Achievements by Category Category/item Amount (DHOOO) Quantity Achieved Irrigated Agriculture Improvements Equip./elec. for wells/drilling 39,944 3,712 Wells drilled 29,848 2,775 Irrigation Equipment 11,802 5382 ha Water distribution 7,684 4530 ha Other 247 1892 ha SubtotaL 89,525 Land Improvements Plowing 6,116 2367 ha Destoning 1,565 3089 ha Subsoil plowing 209 532 ha Land reclamation 1,440 1249 ha Levelling 47 349 ha Construction of stone banks and correction of ravines 320 38,943 ml2 Fruit/cereal banks 219 62 ha Sibtotal 9,917 Agricultural Production Equipment Tractors 8,575 288 Related equipment 8,494 1,072 Miscellaneous smaLl agric. equip. 3,894 11,960 Economic equipment 3,748 28,783 m2 Harvesting equipment 941 109 SLbtotal 25,653 Cereal Seed Production Transportation costs 8,588 654,423 q Recurrent costs 1,374 161,493 q Carrying costs 7,352 163,388 q Discounts 2,220 2,220 q Su.btotal 19,534 981,524 q Forage seed use Suibtotal 3,502 18,883.68 q Air Freight SubtotaL 9,306 5,048 tons Plant Acquisition Subtotat 6,278 438,000 Animal Production Intensification Genetic improvement 3,067 Cattle 2,153 head Swine 1,498 head Breeding buildings 1,629 30,970 m2 Breeding equipment 205 5,394 m2 Feed storage bins 381 687 m3 Silos 13 50 Dairies equipped 151 53 Subtotal 5,447 TOTAL 169,163 _ Figure does not include miscellaneous expenses (DH 47,040.00) or laboratory analysis costs (5,485.50).  - 20 - Table 9. Studies Included in the Project Study Purpose as defined at Status Inpact of study appraisaL FDA impact study Assess eLigibiLity of submitted Highlighted the need to activities for continued FDA 7/31/93 improve operationaL funding; identify which efficiency in terms of groups of farmers benefit productivity, technology from FDA grant program; transfer, and equity identify whether FDA grant issues; underscored program is meeting necessity of stronger objectives and propose portfolio management and necessary improvements. closer cooperation between FDA and CNCA. Budget execution study Identify additional steps submitted Identified procedural for goverrnent action; 6/30/93 issues for improving provide a forum for raising budget preparation and and resolving problems coimnitment of funds; concerning procurement, made proposals for commitment and expenditure closer collaboration of funds; promote between MAMVA and MOF; collaboration between MAMVA prepared budget and MOF, Tresorie g6n6rale, execution manual. and Controle des engagements et depenses; prepare budget execution manual. Audit of MAMVA accounts Comprehensive audit of MAMVA Audit report Highlighted the need for accounts by June 30, 1991. submitted the Bank to reflect more December 1993 on existing procedures Complementary of the Moroccan audit report governmental system when submitted designing a sectoral 4/15/94 investment loan.  - 21 - Table 10. Comparison of Cumulative and Actual Loan Disbursements (US$ Million) IBRD FiscaL Year Appraisal Appraisal Actual Actual Semester Erding Semester Total Semester Total FY 92 Dec. 1991 4.0 4.0 0 0 June 1992 10.0 14.0 0 0 FY 93 Dec. 1992 14.0 28.0 29.0 29.0 June 1993 12.0 40.0 3.2 32.2 F'? 94 Dec. 1993 10.0 50.0 0 32.2 June 1994 17.8 50.0 TOTAL 50.0 50.0 50.0 50.0 Date of final disbursement is 5/17/94 Table 11. Comparison of Loan Disbursements by Category (US$ Million) Category Planned Actual Variation X US$ Million USS Million actuaL over pLarnned 1. Civil Works 8.9 12.4 139% 2. Reforestation 3.3 4.3 130% activities under Part B (4) of the Project 3. Goods 13.3 12.9 97% (excluding pesticides) 4. ConsuLtants' services 8.9 4.4 49% and training 5. Grants under Part C 15.6 15.4 99% of the Project TOTAL 50.0 50.0  - 22 - Table 12. Reconciliation of Legal Covenants Relating to ASIL Agreement Section Covenant Status Origirnal Revised Description of Connents l_____________ Type Date Date Covenant Loan 2.02 1 C 10/92 open special account Loan 4.01 9 NYD 6/30/91 11/17/94 Submit audit Audit report for reports FY92 received. Audit report for 1/1/93-5/17/94 due 11/17/94. Loan Sch. 5 1.a 5 C contin. Maintain Coordination Commi ttee Loan Sch. 5 1.b 5 C contin. Maintain Budget Commi ttee Loan Sup Ltr 3 1.a 4 CD Fund delegation: Targets deLayed 1/20 40% annualLy due to 2/20 80% Late distribution of "Morasse" by Min. of Finance Loan Sup ltr 3 1.d 9 CD 3/31/92 6/30/93 Budget study Loan Sup ltr 3 3.a 5 C 9/30/91 Submit 1992 draft ___________ __________ ~~~~~~~~budget_ _ _ _ Loan Sup Ltr 3 4.a 5 C 10/31/91 Submit action pLan for privatization of livestock services Loan Sup ltr 3 4.b 10 C contin. Keep 20% difference between high & Low season milk Loan Sup ltr 3 5 2 CD 1/31/92 3/24/92 Submit action pLan for recovery or irrigation water ____________ _________ ___________ ~~charges _ _ _ _ _ _ _ _ _ _ Loan Sup Itr 3 6.a 9 CD 12/31/92 7/31/93 Submit FDA impact Study submitted IF :]___ ________ _____ _____ ______ ___ study 8/93 Key: Covenant Types: 1. Accounts/audit 9. Monitoring, review, and reporting 2. Financial performance/revenue generation from beneficiaries 10. Project implementation not covered by categories 1-9 3. Flow and utilization of project funds 11. Sectoral/cross-sectoral budgetary/other resource 4. Counterpart funding allocation 5. Management aspects of the project or executing agency 12. Sectoral/cross-sectoral policy/regulatory/institutional 6. Environmental covenants action 7. Involuntary resettlement 13. Other 8. Indigenous people Status: C = covenant complied with CD = complied with after delay NC = not complied with SOON = compliance expected in reasonably short time CP = complied with partially NYD = not yet due  - 23 - Table 13: Bank Resources: Total Staff Inputs Planied Revised ActuaL Stage of project cycle Weeks weeks Weeks Through appraisal 158.0 109.0 41.7 Appraisal-Board 34.0 62.6 49.6 Board-effectiveness 10.0 22.4 13.5 Supervision 50.0 73.8 35.7 Completion 6.0 7.0 5.0 TOTAL 258.0 274.8 145.5 Table 14. Bank Resources: Analysis of Review Missions Performance rating Number Days SpeciaLized Stage of Month/ of in staff skills ImpLementation Development Types of project cycle year persons fieId represented status status problems Appraisal 5-6/90 6 18 Economist (2) AgricuLturalist Irrigation Engineer Budget Specialist Ag. Educ. SpeciaList Post-Appraisal 9-10/90 4 16 Economist (2) Agriculturalist Procurement Specialist Supervision 9-10/91 2 19 Economist 1 AgriculturaList Supervision 2/92 3 4 AgricuLturaList Irrigation Engineer Accounting Specialist Supervision 3/92 1 15 Economist 2 1 Management Supervision 6-7/92 5 8 Economist (2) AgriculturaList (2) l * Accounting SpeciaList Supervision 10/92 6 12 Economist 2 1 Management AgricuLturalist (2) l * Livestock Advisor Land Affairs Expert Ag. Training l______ Specialist Supervision 4/93 5 11 Economist (2) 2 1 Management AgriculturaList l * Land Affairs Expert Procurement Specialist Supervision 5/94 2 10 AgricuLturaL 2 1 Management Economist Economist Completion 9/94 3 5 Agric. Economist Agronomist I ______________ ________ ________ Livestock Specialist These missions also included significant resources for preparation and appraisal of ASIL II (Ln. 3765-MOR). m:\maroc\asiLl\asiLlicr.aLL   ROYAUME DU MAROC PRET AUX INVESTISSEMENTS DANS LE SECTEUR AGRICOLE PISA I (PRET NO. 3403 MOR) MISSION DE REFLEXION DEUXIEME PRET AUX INVESTISSEMENTS DANS LE SECTEUR AGRICOLE PISA II (PRET NO. 3765 MOR) MISSION D'INITIATION AIDE MEMOIRE 1. Une mission de la Banque mondiale, composee de Messrs. Michael Nightingale (charge de projet), John Cole (agronome), Maurice Gress (expert en passation de marche) et Comelis de Haan (expert en elevage), a sejourne au Maroc courant octobre et novembre 1994 pour examiner les realisations du PISA I et etablir un plan d'action pour la mise en route du PISA II. 2. La mission a travaille en etroite collaboration avec les collegues marocains notamment les responsables de la Direction de la planification et des affaires economiques (DPAE) ainsi que les coordinateurs de chaque departement concerne par les PISA I et II du Ministere de l'agriculture et de la mise en valeur agricole (MAMVA). Monsieur Nightingale a profite de son sejour pour inspecter les acquis et realisations du PISA I dans la province de Marrakech. La mission a, en outre, tire avantage des echanges d'idees avec les representants des Ministeres de l'Incitation de l'economie et des Finances. Les membres de la mission sont infiniment reconnaissants pour l'accueil chaleureux qui leur a et reserve ainsi que pour la collaboration constructive qui a prevalu tout au long de leur sejour. De meme, I'assistance des services exterieurs dont a beneficie Monsieur Nightingale lors de sa visite sur le terrain a et tres appreciable. 3. La mission avait pour objectif de finaliser le rapport d'achevement du PISA I et de mettre sur pied un atelier pour definir les actions a entreprendre pour le demarrage du PISA II. A cet effet, trois commissions ont e creees lors des deux premiers jours pour examiner les points suivants: le budget du MAMVA et les decaissements et audit des fonds du pret, les questions relatives aux passations de marche, et la mise en place d'un systeme de suivi-evaluation. La mission tient a exprimer a chaque participant ses remerciements pour la qualite et la pertinence des observations et recommandations contenues dans les rapports qui lui ont ete soumis par ces commissions et dont la teneur est rapportee dans cet aide-memoire. Une reunion de synthese a eu lieu en date du 24 novembre.  - 2 - LE PISA I Le Rapport d'achevement 4. La mission a beaucoup apprecie les commentaires et suggestions portes par les differentes directions lesquelles ont fait un bilan des aspects positifs du projet et des difficultes rencontrees. Cette nouvelle approche n'en sera que plus benefique pour la preparation de futures actions de developpement et permettra d'eliminer les problemes prealablement poses. 5. Le chef du Service du Budget ainsi que le chef du Fond de developpement agricole (FDA) de la DPAE ont presente un releve detaille des depenses globales du PISA I pour les annees 1991-92 et, ce, pour chaque rubrique financee par le projet ainsi que pour les investissements du FDA. Il reste encore a obtenir un sommaire des depenses totales du MAMVA pour 1991-92. Le chef de la Division des finances exterieures (Ministere des finances) s'est engage a les fournir a la Banque au plus t6t. La mission a charge le coordinateur du PISA II au sein de la DPAE de suivre cette question de pres. L'audit des fonds du projet 6. L'Inspection generale des finances (IGF) a signale a la mission que l'audit final du pret est en cours de redaction et qu'il sera envoye a la Banque d'ici le 31 decembre 1994. Le systeme d'audit a ete ameliore et les informations sont maintenant accessibles a toutes les directions centrales du projet, y compris les precisions sur les depenses du PISA II, et elles sont communiquees trimestriellement a la DPAE. Ces modifications sont tres positives et elles seront efficaces a condition que les DPAs soient a meme d'apporter ces precisions. Ce systeme a ete accorde par la commission responsable a l'atelier. La mission a 6galement charge le coordinateur du PISA II d'obtenir l'accord formel de la Direction du budget au sein du Ministere des finances ainsi que celui de l'Inspection g6nerale des finances (IGF) sur ledit systeme. LE PISA II 7. Les discussions sur le PISA II ont porte sur les points suivants: l'entree en vigueur du pret, les realisations des investissements faits en 1994 au niveau de chaque direction et du FDA, le probleme des financements retroactifs, la passation des marches et le systeme de suivi pour les actions du projet. L'entree en vigueur du pret 8. Une fois l'accord de pr&t signe, les conditions restant a remplir pour declarer l'entree en vigueur sont les suivantes: I'approbation par le Conseil du gouvernement des instruments pour la deregulation du systeme de commercialisation de toutes les cereales (a l'exception du ble tendre) en amont des minoteries, l'avis juridique, et la publication du decret ratifiant l'accord de pret. La signature proprement dite est prevue debut d6cembre a Washington en presence de  l'ambassadeur du Royaume du Maroc aux Etats Unis. Le chef de la Division des finances de 1'exterieur a confirme que le document approuvant la deregulation a et signe et qu'une copie sera envoyee sous peu a la Banque. La mission a demande au coordinateur de veiller a ce que les trois documents requis pour 1'entree en vigueur soient transmis avec celerite a la Banque afin que le pret puisse entrer en vigueur avant fin 1994. La mission a exprime son inquietude s'agissant des reductions budgetaires prevues pour 1995; celles-ci risquent de faire echouer les actions du projet telles qu'envisagees dans l'accord de pret. Les realisations du projet 9. Apres en avoir discute avec les coordinateurs de chaque direction associee et le FDA, la mission a eu le sentiment d'un programme tres positif quant aux activites du projet et quant aux progres accomplis par les rubriques a financer par le pret. L'ensemble des developpements prevus pour 1994 sont en cours avec un objectif atteint pour les marches engages de 90%. 11 reste cependant que les paiements effectues en 1994 (arretes au 31/10/94 a 50%) accusent un retard dui a la nature de certaines depenses d'investissement qui sont etalees sur plus d'une annee. Il faut bien suivre les progres de ces developpements de maniere a s'assurer que les delais et retards pouvant survenir I'annee prochaine sont plut6t occasionnes par des problemes de gestion que par des problemes de tresorerie budgetaire. 10. La mission voudrait soulever les commentaires suivants en ce qui concerne les actions entreprises en 1994 par les directions techniques associees au projet: a) Plusieurs directions, en particulier la DAF, la DAHA et la DE, sont concernees par les problemes de retard et de reduction budgetaire qui risquent de reduire leurs r6alisations sur le terrain. b) Le reboisement est bien organise (DEFCPS), mais il est, d'une part, menace par le manque de ressources de fonctionnement, i.e. pour l'entretien des pistes d'acces, et, d'autre part, il faudrait inciter les communautes concernees a apporter une participation plus active et a prendre en consideration les implications de nature legales. c) Les actions d'amenagement foncier (DAF) sont bien entreprises et le niveau de participation des beneficiaires est appreciable. La mission a souligne l'importance d'accorder une attention aussi grande que possible aux petits exploitants afin d'avoir un champ d'application elargi. Pour cela, il faudrait considerer des possibilites d'assistance pour le remembrement. d) Les essais sur l'amenagement des parcours (DE) sont tres satisfaisants. II faudrait en etendre le rayon d'action en mettant l'accent sur la participation des beneficiaires, du moins concernant leur contribution aux travaux; e) Pour les actions entreprises en matiere d'elevage: (i) la Banque approuve  - 4 - l'organisation des centres de collecte du lait dans le secteur prive mais elle a toutefois demande plus de details sur les zones marginales; (ii) il faut determiner quelles sont les maladies non-contagieuses ainsi que les honoraires des veterinaires; (iii) pour les autres services, il serait pr6ferable d'investir dans l'achat d'equipements n6cessaires avant de penser privatisation et, surtout, il faut etablir le budget et le couit de ces services; et (iv) il faut faire avancer 1'etude sur le transfert de gestion des "herd books" au secteur prive. f) Pour 1'enseignement et la vulgarisation (DERD), la mission a et informee de l'existence d'une nouvelle organisation etablie par le MAMVA et que le Parlement doit approuver. La mission a demande A Wre notifie des que possible de la teneur de cette nouvelle organisation. Pour 1'etude sur I'enseignement superieur, et bien que le rapport pour le MAMVA soit termine, il faut attendre les resultats d'une commission nationale sur le sujet en general avant de se prononcer. g) Pour la protection des vegetaux (DPVCTRF), l'evaluation des stocks de produits phytosanitaires dont la date d'expiration est depassee est faite et un systeme de stockage a ete approuve. Il faut, par contre, mettre l'accent sur la destruction de ces produits perimes A un couit moindre et sans danger. La mission a promis de soulever cette question aupres de 1' administration. h) La mission est inquiete s'agissant de la tendance du FDA A aider les grands exploitants. Elle a souligne l'importance d'une application generale des nouveaux reglements pour mieux couvrir tous les beneficiaires. 11, Outre les investissements envisages pour le PISA II, la mission a examine les realisations faites par rapport au calendrier des reformes et actions (matrice). Les actions prevues dans la matrice avant le 31 decembre 1994 sont soit realisees soit en cours. II a ete convenu que le coordinateur du projet veille au bon deroulement des actions prevues dans la matrice de sorte qu'elles soient accomplies en temps voulu et conformement au calendrier prevu. Dans le meme ordre d'idees, il faut s'assurer que les recommandations concernant chaque etude financee par plusieurs rubriques du pret fasse l'objet d'un programme precis de mise en route. 12. Pour les etudes prevues dans le rapport d'evaluation du projet (elevage: strategie de parcours et reseau d'exploitation; enseignement: systeme d'enseignement superieur; protection vegetale: plan d'action sur l'evacuation des pesticides; production vegetale: reglementation des engrais; et actions foncieres: transferts de proprietes), il y a eu un certain progres et, dans l'ensemble, les actions ont suivi le calendrier envisage. Concernant le rapport sur la strategie des parcours (volume IV), la mission a indique son accord sur les commentaires de la Direction de l'elevage en juin 1994, commentaires qui ont insiste sur le besoin d'etre plus precis. La mission a charge le coordinateur du projet de suivre les progres des etudes de maniere A assurer leur achevement a temps.  - 5- Budget et financement du projet 13. Suite aux changements operes sous le PISA II, les procedures de budgetisation du MAMVA ont et6 ameliorees et la mission en a felicite le service du budget de la DPAE. La mission a note, par ailleurs, que le programme de formation en matiere d'execution du budget, envisage comme partie des actions du PISA II, est deja bien avance. 14. Concemant le budget fiscal du projet, la majorite des coordinateurs des directions techniques ont fait part de leurs inquietudes quant aux reductions envisagees. En meme temps, les responsables au sein de la DPAE ont explique que les reductions budgetaires n'affecteraient que les frais de fonctionnement. II incombe a chaque direction de decider quelles seront les rubriques a reduire. Le budget pour l'annee 1995 est en voie de finalisation et doit etre presente au Parlement avant fin novembre. Pour le moment, il n'est pas certain que les rubriques financees par le pret ne soient pas affectees. La mission a demande au coordinateur du projet d'envoyer a la Banque, des que possible, une copie du budget final. 15. Concernant le financement des actions du projet, la mission a examine la situation actuelle des depenses (pour 1994) avec les differents coordinateurs des directions techniques associees et du FDA. Tel qu'il a ete prevu dans l'accord de pret, un montant a hauteur de 12 millions de dollars E.U. equivalents de ces depenses serait remboursable retroactivement. II etait entendu que la DPAE deciderait quelles seront les depenses precises a imputer sur l'annee arretee au 31/12/94. La mission a souligne l'importance d'operer la selection des depenses en fonction des directives de la Banque. Passations de marches 16. La mission a decrit de facon generale les directives de passation de marches de la Banque, celles concernant les marches de travaux et de fournitures, et celles concernant l'emploi de consultants. La mission a insiste, vu 1'existence de divergences entre les procedures de la Banque et les reglementations marocaines en la matiere, sur l'accord du Gouvernement Marocain a faire prevaloir et a utiliser les directives de la Banque pour tous les projets finances par celle- ci. 17. Ainsi, par exemple, lors de l'ouverture publique des plis dans les marches de travaux et de fournitures, l'ouverture des enveloppes techniques et financieres sera faite simultanement. De meme, et contrairement aux marches de travaux et de foumitures, il a ete precise que le recrutement de consultants ne sera pas fait par voie d'appels d'offres et avis dans les journaux mais par consultation restreinte (short list). Dans ce cas, l'ouverture des plis ne se fera pas en public et l'ouverture des plis financiers ne sera faite qu'apres qu'une notation technique des offres ne soit completee. 18. La commission de l'atelier sur les marches a abouti aux conclusions suivantes:  - 6 - (i) Puisque le MAMVA a deja etabli, en collaboration avec la Banque mondiale, des documents d'appels d'offres types pour les marches de travaux et fournitures dans le cadre du PISA I, et dont les dispositions avaient ete approuvees par le MAMVA et la Banque, alors la commission recommande que ces memes documents soient utilises par toutes les entites du MAMVA concemres pour le PISA II avec cependant une precision supplementaire: concernant l'ouverture des plis en public, les plis techniques et financiers doivent etre ouverts simultanement. (ii) Les documents d'appels d'offres etablis par le MAMVA et utilises dans le PISA II sont les suivants: - dossier type d'appel d'offres ouvert pour les travaux de genie civil; - dossier type d'appel d'offres ouvert au niveau national pour les fournitures; - dossier type d'appel d'offres ouvert au niveau international pour les fournitures. 19. Pendant I'atelier et lors des visites aux directions centrales associees, plusieurs intervenants ont fait part de la difficulte d'appliquer les directives de la Banque n'ayant pas ete informes de l'accord du Gouvernement Marocain pour l'application des directives de la Banque. Une des difficultes etant l'application des directives s'agissant du recrutement de bureaux d'etude par liste restreinte lorsque le montant depasse 1 million de DH. La mission a discute de cela avec Son Excellence le Ministre de l'incitation de l'economie qui a confirme l'accord du Gouvernement pour tous les projets finances par la Banque. Le Ministere a egalement confirme l'envoi a tous les ministeres d'une copie de sa lettre a la Banque mondiale de novembre 1992 approuvant l'utilisation des procedures de la Banque. II semble, cependant, qu'une certaine reticence de la part de la Commission centrale des marches empeche l'application uniforme de ces directives. 20. En fin d'atelier, la DPAE a suivi les recommandations de la commission des marches en ce qui concerne les documents a utiliser par ses services exterieurs dans le cadre du PISA II. La mission a par ailleurs exprime le voeu de voir les documents suivants mis a la disposition des DPAs et les autres organismes concernes par les directions centrales concernees: l'accord de pret, les directives de la Banque pour les marches de travaux et de fournitures et les directives pour 1'emploi de consultants. 21. Concernant les etudes a realiser, le recrutement de consultants se fera par liste restreinte comportant un minimum de trois bureaux et un maximum de six. Une lettre d'invitation sera envoyee aux bureaux d'etude, accompagnee des termes de reference et d'un modele de contrat. L'ouverture des soumissions ne sera pas publique. Systeme de suivi du projet 22. La mission a discute avec la division de Suivi et evaluation a la DPAE du systeme en voie d'implantation dans les directions techniques. La mission a note l'existence d'un systeme de suivi-evaluation au sein du MAMVA depuis plusieurs annees et cela avec l'assistance du  PNUD et de la FAO. La mission a indique que la Banque voudrait endosser ce systeme mais, a son avis, les objectifs des deux phases de developpement en cours sont tres ambitieux. Selon la Banque, les programmes de suivi comportant une methodologie simple et des objectifs modestes sont generalement les plus efficaces sur le plan des resultats. Il serait donc preferable si l'on identifiait, chaque annee, les priorites a adopter pour les actions de suivi. 23. Il a e aussi convenu durant cet atelier qu'un systeme de suivi-evaluation des lignes budgetaires financees devrait Wtre mis en oeuvre dans chaque direction. Ce systeme comprendrait deux parties: (i) selon les actions concernees, il y aurait en premier un suivi comptable et physique de toutes les lignes financees avec comparaison des ecarts par rapport aux previsions; et (ii) en second, il y aurait une evaluation de l'impact des investissements au regard des beneficiaires, de l'augmentation de la production, etc... afin de pouvoir, en fin de projet, calculer le taux de rentabilite interne de l'investissement. Une ligne serait choisie par chaque direction pour cette evaluation. 24. La commission a decide que: (i) chaque direction technique associee devra preparer un rapport semestriel qu'elle communiquera a la DPAE laquelle soumettra a la Banque un rapport annuel; (ii) concernant le choix des lignes a evaluer a partir de 1995, la mission a visite les differentes directions, et il a ete propose d'evaluer les lignes indiquees dans l'Annexe 1 ci-jointe. 25. Les directions techniques et la division de suivi-evaluation ont souleve le probleme du manque de moyens disponibles pour la creation de cellules de suivi, en particulier pour les visites sur le terrain. La mission va porter ce probleme a la connaissance du Ministre de l'agriculture. Elle a indique que les fonds du pret pourraient etre utilises pour lancer ce systeme et attend qu'on lui fasse une proposition sommaire dans ce sens. Cette possibilite devrait etre envisagee lors de la revision du budget des investissements pour les annees a venir. 26. La division de suivi-evaluation, a la DPAE, est chargee de la conception du canevas de tableau de bord pour le suivi des actions du PISA II. L'echeancier prevoit l'achevement du travail preparatoire avant le 15 decembre 1994 et la mise en place du systeme a partir de 1995. La mission a indique qu'une revue de la situation des developpements de suivi sera important pour la prochaine mission de revue du PISA II; il est particulierement important de determiner les points suivants pour chaque etude: (i) arreter les themes principaux; (ii) identifier les zones d'action; et (iii) preparer un budget.  -8- Gestion du projet 27. La mission a souligne l'iimportance d'une coordination efficace pour le projet. Elle a suggere la designation d'un coordinateur charge de 1'evolution des points suivants: liaison avec la Banque, progres de la situation budgetaire du projet, progres de la situation d'investissement de chaque rubrique; la situation en ce qui conceme la matrice et les etudes, et le progres du systeme de suivi. Rapports 28. La mission a felicite la DPAE pour la qualite de ses rapports sur les progres annuels sous le PISA I. Pour les actions de suivi du PISA II, la mission a demande au coordinateur des rapports semestriels concis sur les progres du projet. Prochaine mission 29. La mission a propose une date pour la prochaine mission de revue, probablement la deuxieme quinzaine de janvier, 1995. Les objectifs de celle-ci seraient l'examen des suivants: (i) le dernier rapport d'audit du PISA I; (ii) les marches et les decaissements retroactifs pour 1994; (iii) le budget pour 1995; (iv) les propositions de chaque direction et du FDA sur les precisions a apporter dans les budgets previsionnels pour 1996 et 1997; (v) les operations du FDA pour le PISA II, dans le cadre de la CNCA; (vi) les prix de reference des produits agricoles pour 1995, en particulier les equivalents tarifaires pour les cereales; et (vii) la mise en place d'un systeme de suivi pour les activites du PISA II. Michael Nightingale Charge de projet le 30 novembre 1994  ANNEXE ROYAUME DU MAROC DEUXIEME PRET AUX INVESTISSEMENTS DANS LE SECTEUR AGRICOLE (PISA II) Proposition sur les actions a evaluer DIRECTION LIGNE ACTION AGR-DAHA 73/41/10 Amenagement hydro- agricole de Moyen Sebou; quelques sites a choisir. DDGI 73/44 Barrages collinaires. AGR-DAF 74/20/20 Epierrage. DPVCTRF 43/30/30 Controle des semences/plants: travaux d'amenagement et d'instal- lation (a determiner la possibilite d'une evaluation technique de 1'achat d'equipement). DPV 45/90/-- DRS fruitiere (a determiner: l'evaluation de l'impact des essais de demonstration [45/40/30-32]). DE 46/22/12 Amelioration des terrains de parcours (a determiner: en matiere de campagne de vaccination [46/13/10-20]). DERD 50/32/10-40 Construction centres de formation continue.  APPENDIX B. Borrower contribution to the ICR Analysis for the ICR was undertaken together with Government representatives during Bank missions in October/November, 1994. It is based on material in the project file. The borrower's views are reflected in the ICR and noted in the attached mission's aide-memoire.   ')i : n iIAj i' H 1H T N: o -4 ICV A-3 9 I , O'' '!i m 1 1.