Tunisia - Second Electrical and Mechanical Industries Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No.13919 PROJECT COMPLETION REPORT TUNISIA SECOND ELECTRICAL AND MECHANICAL INDUSTRIES PROJECT (LOAN 2554-TUN) JANUARY 26, 1995 Industry and Energy Division Maghreb and Iran Department 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.  List of Abbreviations API Agence de Promotion des Investissements BDET Banque de Developpement Economique de Tunisie BTEI Banque de Tunisie et des Emirates d'Investissements BTKD Banque Tuniso-Koweitienne de Developpement CETIME Centre Technique des Industries Mecaniques et Electriques EMI Electro-Mechanical Industries ERPR Economic Rate of Return FRR Financial Rate of Return INNORPI Institut National de la Normalisation et de la Propriete Industrielle MEN Ministere de l'Economie Nationale SSI Small-scale Industries STUSID Societe Tuniso-S6oudienne d'Investissements et de D6veloppement Currency Equivalent At Project Appraisal (1984) TD .83 = US$ 1 March 1994 TD 1 = US$ 1  FOR OFFICIAL USE ONLY THE WORLD BANK Washington, D.C. 20433 U.S.A. Office of Director-General Operations Evaluation January 26, 1995 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on Tunisia Second Electrical and Mechanical Industries Project (Loan 2554-TUN) Attached is the Project Completion Report on Tunisia - Second Electrical and Mechanical Industries Project (Loan 2554-TUN). Part II was prepared by only one of the three participating development banks. Following the first Electrical and Mechanical Industries Project (Loan 2113-TUN), the project, as approved in 1982, consisted of two components: (i) a line of credit to provide resources to the private sector for investment projects in the subsector; and (ii) funds for technical assistance and equipment to two government agencies, Centre Technique des Industries Mecaniques et Electriques (CETIME) and Institut National de la Normalization et de la Propriete Industrielle (INNORPI). In 1988, 43 percent of the $50 million in the line of credit component was cancelled because of low demand. A study carried out after the cancellations concluded that, in addition to the general decline in the investment climate, the collapse of the automotive subsector and the increasingly more favorable opportunities in tourism were important factors in explaining the dearth of demand for private investment in the electrical and mechanical industries. At closing, in June 1993, only one-third of the original line of credit had been utilized. The two technical agencies-CETIME and INNORPI-successfully utilized their allocations and enhanced their services to the industry, notably to firms in the electromechanical subsector. Bank supervision did not effectively pursue the covenant that required monitoring of the prices of products manufactured by the subproject borrowers. This was an important issue because, under one of the loan covenants, quantitative restrictions (QRs) were accepted provided that enterprises maintained selling prices determined on the basis of international reference prices. The outcome of the project was marginally satisfactory: the majority of subprojects financed are expected to have satisfactory financial results. However, given the arrears experienced by the participating development banks, its sustainability is rated as uncertain. The project, however, had substantial institutional development impact. The PCR is of satisfactory quality. An audit is planned. Attachment This document has a restricted distribution snd may be used by recipients only in the performance of their official duties. Its contents msy not otherwise be disclosed without World Bank authorization.   FOR OFFICIAL USE ONLY PROJECT COMPLETION REPORT TUNISIA SECOND ELECTRICAL AND MECHANICAL INDUSTRIES PROJECT (LOAN 2554-TUN) TABLE OF CONTENTS Page Preface . . . . . . . . . . . . . . . Evaluation Summary . . . . . . . . . PART I: REPORT OF THE BANK 1. Project Identity .1... . . . . . . . . . . . . . . . . . . . . . . 2. Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 3. Objectives and Description .1 4. Project Design and Preparation. 2 S. Project Implementation. 4 6. Project Results. 7 7. Performance of the Borrower. 8 8. Performance of the Bank . . . . . . . . . . . . . . . . . . . . . . . 9 9. Project Sustainability ...................... . 10 10. Lessons Learned. ....................... 10 PART II: REPORT OF THE BORROWER Report of STUSID . . . . . . . . . . * . 12 PART III: STATISTICAL INFORMATION 1. Related Bank Loans .29 2. Project Timetable .... . . . . . . . . . . . . . . . . . . . . . . 29 3. Cumulative Loan Disbursements ... . . . . . . . . . . . . . . . . . 30 4. Selected Project Implementation Indicators ... . . . . . . . . . . 31 5. Project Costs and Financing ... . . . . . . . . . . . . . . . . . . 32 6. Project Results .... . . . . . . . . . . . . . . . . . . . . . . . 33 7. Status of Project Covenants ... . . . . . . . . . . . . . . . . . . 35 8. Use of Bank Resources .... . . . . . . . . . . . . . . . . . . . . 41 9. Use of Staff Resources . . . . . . . . . . . . . . . . . . . . . . . 42 10. List of Subprojects and their Investment Costs . . . . . . . . . . . 43 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.   i PROJECT COMPLETION REPORT TUNISIA SECOND ELECTRICAL AND MECHANICAL INDUSTRIES PROJECT (LOAN 2554-TUN) PREFACE 1. This is the Project Completion Report (PCR) for the Second Electrical and Mechanical Industries Project in Tunisia, for which Loan No. 2554-TUN in the amount of $54.0 million was approved on May 23, 1985. In 1988 the Bank cancelled a large portion of the loan amount, at the Government of Tunisia's request. When the loan closed on June 30, 1993, only 39% of the original loan amount was disbursed, and the remainder was cancelled. 2. The PCR was prepared by the Industry and Energy Division of the Maghreb and Iran Department (Preface, Evaluation Summary, and Parts I and III). The Bank sent the borrower and the participating development banks Parts I and III, with the request to prepare Part II, but only one of the three development banks responded. 3. Preparation of this PCR was started in November of 1993 and is based, inter alia, on the Staff Appraisal and President's Reports, the Loan and Project Agreements, supervision reports, correspondence between the Bank, the borrower and the participating development institutions, and internal Bank memoranda and reports.   iii PROJECT COMPLETION REPORT TUNISIA SECOND ELECTRICAL AND MECHANICAL INDUSTRIES PROJECT (LOAN 2554-TUN) EVALUATION SUMMARY (i) obiectives and Design. The project was to provide resources for investment projects in electrical and mechanical Industries to the private sector and funds for technical assistance and equipment to two government agencies, Centre Technique and des Industries Mechanique et Electrique (CETIME) and Institut National de la Normalisation et de la Propriete Industrielle (INNORPI), which provided technical assistance and set standards for the sector. Additionally, the Bank sought to assist Government in its review and rationalization of tariffs and quota restrictions (QRs) for electrical and mechanical industries and to encourage the efficient development of the sub-sector. The Government on-lent the funds through three DFIs which had been fully appraised and which were participants in another line of credit that had been recently approved by the bank. Two of the three DFIs, Banque Tuniso-Koweitienne de Developpement (BTKD) and the Soci6t6 Tuniso-S6oudienne d'Investissement et de Developpement (STUSID) had been in operations for only 3 years. The Banque de Developpement de Tunisie (BDET), on the other hand, had been a participant in several credit lines, including the first Electrical and Mechanical Industries Project (Loan 2113-TUN) which was approved in 1982. (ii) Implementation Experiance and Issues. Negotiations, Board Approval, and signing were basically within schedule. Effectiveness was delayed by 7 months, however, as a result of delays in approval in the loan documents by Parliament. Economic factors caused a two-year slippage in closing. Appraisal estimates of commitments and disbursements were also optimistic and relied heavily on projected pipelines of the financial institutions and the experience of the first Electrical and Mechanical Industries Project, which was a significantly smaller loan. As a result of the low utilization of funds, one and a half years after effectiveness the Bank cancelled, 43% of the loan amount allocated to the three development banks. In addition, to increase utilization of the funds the Bank extended the deadline for commitments and for closing by one year. (iii) Results and Sustainability The project succeeded in ensuring resources to the sub-sector through a number of development banks thus introducing some competition in the retailing of loans. Demand for financing though was significantly less than anticipated by the Bank. In addition, arrears affected a high percentage of the portfolio of the DFIs and also credits to the sub-sector, which raises concerns about the ability of the DFIs to intermediate funds efficiently and leaves questions about the policy to encourage development of electrical and mechanical industries through the targeted credits to DFIs. As for CETIME and INNORPI, the two institutions created to develop the sector, both institutions extended more services, though INNORPI was slow in introducing product certification.  iv (iv) Performance. Institution building of the development banks was effective in improving supervision procedures of two DFIs. Supervision missions by the Bank, though, were irregular and too short given that missions usually supervised several credit lines at once. Consequently, missions focused more on the financial situation of the Banks than the particular problems in the electrical and mechanical industries sector. No supervision missions addressed compliance with the important loan covenant concerning subsector protection, which required monitoring the sub-projects pricing practices which were to be based on international reference prices. In general, the Bank was receptive to Government requests from identification through implementation. Bank efforts to have Government reduce its arrears with BDET, were not successful. However, Government reached a reasonable agreement with BDET to compensate it fully for interest charges it incurs, as a result of borrowing in the money markets, to cover its liquidity gap. In addition, in compliance with covenants, the Government completed a foreign exchange risk study which was instrumental in defining a new foreign exchange risk coverage scheme. (v) Lessons Learned and Recommendations for Future Projects. Credit line operations should be open for all private sector investments, unless a targeted line can be fully justified; as a result of the narrow scope of the credit line component, the resources were not fully used. Furthermore, for credit line operations in which the Government bears the foreign exchange risk, the design of foreign exchange risk schemes should be an integral part of the design of credit line operations, and such schemes should compensate Government for bearing the foreign exchange risk. Bank management should also ensure adequate and regular supervision missions and staff should be responsible for properly maintained files, timely review of sub-projects, and, most importantly, verification of compliance with all covenants.  PROJECT COMPLETION REPORT TUNISIA SECOND ELECTRICAL AND MECHANICAL INDUSTRIES PROJECT (LOAN 2554-TUN) PART I: REPORT OF THE BANK 1. Project Identity Country Tunisia Project Name IF Second Electrical and Mechanical Industries Project Loan Number 2554-TUN Project Code 5TUNPA071 Regional Vice Middle East and North Africa Presidency Supervising Industry and Energy (MN1IE) Division 2. Background 2.1 During the 1970's and early 1980's with a shift toward mnore liberal economic policies, manufacturing industries became one of the main sources of economic growth in Tunisia. Throughout this period, growth in manufacturing industry, at an average rate of 11% in real terms, outstripped GDP growth. Despite this achievement, the share of manufacturing in GDP was only 14% by 1984, leaving ample room for additional expansion. 2.2 Through the sixth five year plan (1982-1986), Government promoted greater development of the industrial base to support the creation of jobs and to improve the deficit of the current account. As petroleum exports were expected to decline, Tunisia faced a deteriorating financial and balance of payments situation. In response, the five-year plan's emphasis on export industries as well as selected industries, which would reduce the countries dependence on imports, seemed logical. Among the selected industries to be promoted were electrical and mechanical industries, which demonstrated significant opportunities for both import-substitution and exports, as well as job creation, according to a Bank study undertaken at Government request. 3. Prolect Obiectives and Description 3.1 Obiectives. The objectives of the project were twofold. The first was to promote the development of electrical and mechanical industries by financing, through three development banks, the establishment, expansion and modernization of industrial enterprises engaged in exports. The second objective was to enhance and expand services provided by two institutional  2 agencies which were created to foster the efficient development the EMI sector. 3.2 Description of Loan Component to Fund Private Sector Investments . The project consisted of a USS 54 million loan to the Government, of which USS 50 million was to be on-lent to the development banks for the purpose of developing the private sector. Government passed on USS 20 million to Banque de Developpement de Tunisie (BDET), and US$ 15 million to each the Banque Tuniso-Koweitienne de Developpement (BTKD) and the Societ6 Tuniso-S6oudienne d'Investissement et de Developpement (STUSID) to cover part of their resource needs, for the financing of eligible electrical and mechanical industries subprojects. The foreign exchange costs of goods, works and services of subprojects, which was estimated to be about 55% of total costs, was to be financed by the proceeds from the Bank loan. Electrical and mechanical industries subprojects eligible for financing covered (a) investments in one of the priority sub-sectors and (b) investments in the non-priority sub- sectors provided that a satisfactory level of exports were to be produced as a result of the project. For subprojects in the non-priority sectors, the requirement to export was identical to that of the Export Industries Project (a minimum of 30% of productions for greenfield project and for extension projects a minimum of 50% of the additional production). 3.3 Interest rates on sub-loans were to be no less than 12%, thereby ensuring that the banks initially would have a positive income spread for each sub-project. Government was to on-lend the proceeds of the loan to the development banks, in local currency, at an interest rate equal to the prevailing Bank interest rate, and Government was to bear the foreign exchange risk. The project set limits on the maximum size of subloans in order to discourage the use of the loan proceeds for a large number of projects: USS 2 million, if the project was to be financed by only one development bank and USS 4 million, if the project was to be financed by more than one participating financial institution. 3.4 Description of Grants to be Provided to CETIME and INNORPI. The Government was to also make available on a grant basis USS 4 million to Centre Technique des Industries Mecaniques et Electriques (CETIME) and Institut National de la Normalisation et de la Propriete Industrielle (INNORPI). The funds were for the purchase of technical assistance and equipment. CETIME was to open a Mechanics laboratory and a small Electronics division, expand services of its Foundries Section, and continue to hire foreign experts to further develop its program of technical assistance to firms in the EMI sector. INNORPI was to open a laboratory, to test EMI products, and to hire foreign experts, for the purpose of producing standards and delivering certifications for products that met its standards. 4. Project Design and Preparation 4.1 Participation of Three Development Banks. The structure of the project differed from other previous lines of credit in which just one financial institution channeled Bank funds. In addition to BDET, two relatively new development banks, BTKD and STUSID, were chosen by the Bank to participate in the project. Previously BDET was the single financial intermediary in nine  3 industrial investment projects, including the first Electrical and Mechanical Industries Project. Project Completion Reports for many of the Bank loans had noted considerable improvement in institution-building and management performance, and BDET's participation in this project was to ensure continued support by the Bank. Government and the Bank also believed that similarly the Bank would contribute to important institution-building in the new banks by providing them with a framework for establishing investment project appraisal and supervision standards. Both STUSID and BTKD were extremely well capitalized. Their respective capital bases were double BDET's and the banks' debt to equity ratios were less than one to one. 4.2 Institution Building and Technical Assistance Component to CETIME and INNORPI. In the course of a Bank review of the EMI sector in 1979-80, there proved to be a need for an institution that could provide technical assistance to firms. In response to the study's findings, the Government created CETIME as a part of the first Electrical and Mechanical Industries Project financed by the Bank. CETIME was established to provide three types of support services to EMI enterprises: i) in-plant guidance and trouble shooting, ii) assistance in rationalizing product mix and selection of technology and iii) on-the-job training of technicians. The Center's performance under the first project was very satisfactory, so inclusion in the second EMI project was a logical step to further the development of CETIME services. INNORPI also was created at the beginning of the decade, and it also participated under the first Electrical and Mechanical Industries Project. Under the first project, INNORPI obtained technical support of three foreign experts for 26 man-months, including one expert who advised Government on the orientation and priorities of the institute. By the time of preparation of the second project, the institute had produced already 800 standards. Inclusion in the second project was thus another logical step in Bank support of the EMI sector, for additional funds would enable the Institute to produce certifications based on its own standards. 4.3 Major Issues: Reduction of ORs. One of the two major issues in project preparation was the use of quota restrictions by the Government to protect Tunisian EMIs. At various stages of the review process, staff and management repeatedly addressed the issue and diBcussed the impact of import licensing on the development of the sector and the sub-projects. Under the project, sub- projects producing old EMI goods would continue to benefit from the protection afforded them through QRs, while only new EMI goods (produced for the first time in Tunisia) would not benefit from protection of QRs. QRs were to be accepted provided that enterprises could maintain selling prices determined on the basis of international reference prices. If sub-projects could not maintain these prices, Government would gradually reduce the QRs. This understanding concerning protection essentially mirrored agreements reached in the first Electrical and Mechanical Industries project. But even though the Bank agreed just two years earlier to these terms of eligibility for sub- projects, a number of Bank staff members expressed concerns that it would be difficult for Government to determine appropriate international reference prices, monitor the industries, and thereby ensure the efficient development of the sector. Elimination of the QRs was considered necessary, by many staff members, as a necessary prerequisite for success of the project. In the end, management decided that the issue of QRs would be tackled best by a broader  4 approach in the context of an adjustment loan, rather than sector by sector. Under the Industrial Trade and Policy Adjustment Loan, which was approved in 1987, the Bank and Government agreed to eliminate QRs by 1991. The removal of quota restrictions, though, remained an issue at project completion and further elimination of QRs is being undertaken under the Economic and Financial Reform Support Loan. 4.4 Major Issues: BDET's Financial Situation. Bank management also raised concerns related to BDET's financial situation. The two immediate concerns about BDET's financial situation were (i) its substantial arrears on its project portfolio and (ii) the large amounts the Government owed to BDET as compensation for foreign exchange losses on foreign borrowings. Although the Bank found the arrears situation generally acceptable, given the general slowdown in the economy, it noted the need to monitor the arrears situation closely. BDET's arrears amounted to about TD 16 million or about 8% of its loan portfolio. Since almost half of the arrears were in 22 companies, the Bank requested that BDET design individual action plans for resolving arrears and closely monitor the companies. The Bank, during negotiations, agreed with BDET that it would keep the Bank abreast its progress, and BDET agreed to reduce arrears to less than 5% of its portfolio by 1986. 4.5 That Government had not compensated BDET for DT 16 million in foreign exchange losses on external borrowings for the years 1983 and 1984 was an additional concern of the Bank. An agreement was to be reached under the Export Industries Project, which was to be negotiated a few months prior to negotiations of the project. Senior management suggested that Board presentation be conditional on payment of DT 10.5 million, which had been already been earmarked in the budget for such purposes, and that if this was not possible, the payment of DT 10.5 million should be made in 1985. The later was agreed to, but not put in place as a condition of effectiveness, since it was anticipated that effectiveness could take place as early as November. Additionally, management agreed that a foreign exchange risk study should be undertaken, by March of 1986, which could be used to define a new scheme to assist Government in managing its foreign exchange risk. 5. Project Implementation 5.1 Implementation Schedule. Negotiations, Board Approval and Signing were within schedule. However, loan effectiveness, which was supposed to take place on November 11, 1985, was delayed by seven months. The Bank ultimately extended the date of effectiveness three times as a result of delays in approval of legal documents by the National Assembly. The signing of subsidiary loan agreements between the Government and each participating bank was the only additional condition of effectiveness. 5.2 Commitments and Disbursements. Out of an original loan amount of US$ 54 million, USS 23 million was committed and USS 21.1 million was disbursed. Commitments and disbursements for the two agencies, CETIME and INNORPI, were generally on schedule. However, only 39% of the proceeds of the Bank loan for investments were committed and 33% were disbursed, after several cancellations of subprojects. Relative to their allocations, all three banks experienced difficulties in lending under the project. BDET committed and disbursed 37% of  5 the original amount of its allocation, and BTKD and STUSID disbursed a slightly lower proportion of their original allocation, 30% and 32% respectively. Original allocations and actual disbursed amounts are shown below. Table 1 Use of the Loan Proceeds by DFIs and Agencies (USS million) PDB's and Original Revised Actual Agencies Allocation Allocation Disbursements BDET 20.0 8.5 7.3 BTKD 15.0 10.0 4.5 STUSID 15.0 10.0 4.8 CETIME 2.0 2.0 2.6 INNORPI 2.0 2.0 1.9 TOTAL 54.0 32.5 21.1 5.3 Cancellation of 43% of Loan Amount Allocated to Develonment Banks. As early as late 1987, the supervision mission discussed with Government partial cancellation of the credit line, less than a year and a half after effectiveness. In the Spring of 1988, after receiving an official request from Government, USS 21.5 million of the USS 50 million allocated to the development banks was cancelled, as shown above. Subsequently in 1989 and 1991, BTKD and STUSID requested additional cancellations, as sub-projects were cancelled and demand for financing in the private sector failed to increase. To permit greater use of the funds, the deadlines for commitments and closing were also extended, at the time of the first cancellation, to June 30 1990 and June 30 1993, respectively. 5.4 After the large cancellation of the loan amount, the Bank hired a consultant to study the factors leading to the low level of investment in the sector and the low utilization rate of the line of credit. The consultant and the Bank concluded that factors leading to low investment in the economy coupled with increasingly more favorable opportunities in tourism and the collapse of the automobile sector, led to a dramatic decline in private investment in the electrical and mechanical industries. In the economy at large, from 1984 to 1987, total investment as a share of GDP declined from 31% to 21%. This, in part, was a reaction of the political uncertainty that characterized the end of the Bourguiba era, but equally important, investment costs increased significantly ( by about 60% between 1984 and 1987), as a result of the devaluation of the Dinar and the increase in customs duties on imported capital goods. In this environment, tourism projects, which had a significantly lower component of imported investments costs than manufacturing projects, became more attractive. Additionally, tourism projects benefited from a 3% interest rate rebate provided by Government, which was an additional incentive to invest in tourism rather than industry.  6 5.5 These factors outside the EMI sector explain a large part of the decline in investments. However, there was in addition a sudden collapse of the automobile industry, which had a rippling effect throughout the sector. By 1987, the number of automobiles and trucks assembled had fallen to a third of the number produced in 1984, and, over the same period, the production of tractors was halved. The Bank could have better anticipated the collapse of this sector, with its low capacity utilization and high inefficiencies, though this collapse is only one factor among several responsible for the decline of private investment in the EMI sector. 5.6 Submission and Review of Sub-pro-ects. In general the files for the sub-projects were in poor condition, and for the majority of projects, separate sub-project files had not been created. Once the files were organized, the sub-projects were examined. Overall, BDET's appraisal reports were the most well-organized, complete and detailed. In its evaluation of sub- projects, BDET appears to have benefited from long standing relationships with enterprises and its participation under the first EMI Project. Of the 8 subloans which it granted, seven of them were for extension projects, a high number in comparison with BTKD and STUSID, which together lent to five extension projects. 5.7 Based on information available in the files, all but one sub-project met the agreed eligibility criteria. In appraisal reports provided by all three banks, expected FRR and ERR of sub-projects were well above minimum required of 12 and 10%. The FRR ranged from 14% to 46% and the ERR ranged from 23% to 64%. Other than these minimum rates of return, no additional financial indicators such as maximum debt to equity ratios or minimum debt service coverage ratios were established as eligibility criteria. The majority of sub- projects entailed the production of intermediate and capital goods and coincided with the main objective of the project. Of twenty-five completed sub-projects, seven were for the production of goods to be produced for the first time in Tunisia, indicative of the risk profile of sub-projects. 5.8 The one project which did not fully meet eligibility criteria was the largest investment project to receive Bank funds. The sub-project known as MAKLADA, produced steel wiring. BTKD was the sponsor of the project and took a 41% equity stake in breach of its policies which was a breach of the Project Agreement. STUSID also took an equity position in the sub-project, leaving the private sector less than a 50% share. Technically it was permissible according to the legal definition of private ownership, which was limited to that in which the Republic of Tunisia had no more than 50% ownership, to have two bilateral developments hold a combined equity stake greater than 50%. The project, however, would not reflect the spirit of the Bank loan to provide resources to the private sector. The Project files, unfortunately, do not contain any documentation indicating why the Bank decided to approve the sub- project, in spite of these issues. MAKLADA received 20% of the total proceeds of the Bank loan for investments, approximately SUS 3.7 million. The sub- project's final investment cost was DT 16.2 million, almost equal to the amount of the Bank loan passed on to the development banks. Currently, MAKLADA is experiencing financial difficulties and is in arrears with STUSID though not with BTKD.  7 5.9 Monitoring of Subt,rojects Protection by the Government. During negotiations the Government agreed to monitor the sub-projects that benefited from protection afforded to them through import licensing. At the onset on the project, the Bank noted that Government would require additional resources to monitor the ex-factory prices of EMI sub-projects and ensure that they did not exceed acceptable levels based on international reference prices. No reports or termB of reference in the files demonstrate that this was discussed in the last years of supervision, although sub-projects were completed and fully operational. 5.10 Financial Situation of BDET and STUSID. In the course of project implementation, BDET and STUSID redesigned their supervision policies and procedures. According to supervision reports BDET was successful in reducing arrears. However both banks, as of end 1992, confronted greater financial difficulties, measured by arrears as a percentage of their portfolio and loans affected by arrears as a percentage of their portfolio. A multitude of exogenous factors may explain this deterioration. However, STUSID's experience in lending for this project may also shed light on reasons for its current level of bad loans. STUSID had a significantly higher propensity to lend for greenfield projects than BDET. While this may be attributable to its recent establishment, its policy regarding equity positions may have also had an adverse impact on the loan portfolio. STUSID initially had a policy that mandated the bank to take a large equity holding in a project, when the Bank provided both loans and equity to a project, and this policy may have limited the bank's ability to lend for extension projects. It is notable that of the EMI projects financed by STUSID, most of them were greenfields. Furthermore, of the ten sub-projects which it financed five of them are in arrears. These five sub-projects account for 53% of the amount of proceeds from the Bank loan which were disbursed by STUSID. In contrast only one of BDET's sub-projects is in arrears. 5.11 Financial Situation of BTKD. Mounting arrears and a deteriorating portfolio became a concern during implementation of the project. BTKD, by comparison tended to be more aggressive in building up its portfolio than STUSID which was created in the same year and had equally large equity base. When there was a sharp downturn in private sector investment in manufacturing industries in 1985-1987, BTKD was the last of the three development banks to slow down approvals. BTKD financed a number of projects of uncertain feasibility sponsored by state enterprises or state-owned banks. Lax project supervision standards also contributed to the deteriorating portfolio. As a result of a mission in 1988, the Bank recommended that BTKD management hire a consultant to do a thorough review of the bank's portfolio and operational procedures. In the files there is no evidence that BTKD responded to the Bank's request. In 1990, however, a major reorganization took place which may have had an impact on project appraisal and supervision standards. 6. Proiect results 6.1 Achievements and Shortcomings under the Proiect. Institution building of the two technical agencies was, on the whole, the most successful component of the Bank loan. As a consequence of Bank financing, both CETIME and INNORPI built up their services to EMI firms. CETIME met all objectives of the Bank  8 technical assiBtance, however, INNORPI was slow in developing its certification capacity. According to a Bank study on the industrial sector, CETIME created a system for computer aided design and computer aided manufacture of molds for the production of plastic and rubber parts of tools for cutting and shaping sheet metal, using-state-of-the-art machine tools, electro-erosion tools for making complex cavities for molds, and powder metallurgy plasma spray equipment for repairing worn metal parts. In addition, the technical facilities in Tunis consisted of a complete system for the design, manufacture and testing of electronic printed circuit boards (PCBs). One weakness identified by the Bank's study was CETIME's pricing structure. The study suggested Government's limiting its contribution to cover costs related to CETIME's incubator services and pricing other services on entirely a commercial basis to encourage more efficient use of resources. INNORPI, by comparison, was not as successful as CETIME in either providing services or recovering its costs. By 1989, INNORPI had issued only 17 product certifications for which it had established norms. The institute, which was fully aware of the importance of certification in enhancing product design and production processes, prepared a program for certification of 200 industrial products over from 1989 to 1992. More up-to-date information on CETIME's and INNORPI's services is not available in the files, since this was not reviewed during later supervision. 6.2 The three development banks were not fully successful in channeling the initial amount of funds earmarked for investments. The banks provided loans to only 25 subprojects. 22 subprojects involved the production of priority goods, mainly intermediate and capital goods, and 3 subprojects involved the production of non-priority goods, consumer goods which had export potential. Supplemental information supplied by the three development banks indicate that the projects entailed a total investment cost of US$66.8 million, substantially below initial expectations, given the original Bank loan of SUS 50 million for on-lending. In addition, data collected after most sub-projects were completed and operating, indicates that for most projects, all three Banks appear to have systematically over-estimated the performance of sub- projects. However, the majority of sub-projects should meet the minimum financial rates of return over their lifetimes. 6.3 The three major benefits which the SAR identified for the economy were (i) the creation of jobs, (ii) an increase in EMI exports, (iii) and a decrease in imports of EMI goods. The project's results in creating employment were marginal. Figures on employment indicate that sub-projects generated about 1106 jobs with investment costs per job created at DT 54,700 for extension projects and DT 72,800 for greenfield projects. As for the second and third benefits general data on EMI imports and exports is inconclusive. Given that only some sub-projects were completed and in full operation before 1990, the impact of these enterprises on EMI imports and exports is not likely to be evident for the next few years. 7. Performance of the Borrower 7.1 Responsibilities of Government vis-a-vis the Participatina Development Banks and Aaencies. The Government, as the Borrower under the Loan was to (a) provide on a grant basis funds to CETIME and INNORPI, (b) take  9 responsibility for the conduct of the two agencies and ensure maintenance of their records and provision of information to the Bank, (c) on-lend the proceeds of the loan to the participating Banks, (d) ensure that the Banks met their obligations under the Project Agreement and (e) make satisfactory provisions to protect them against losses resulting from foreign exchange changes. The Government's performance of these obligations was satisfactory except in the protection of BDET from foreign exchange losses. In compliance with covenants, Government completed a foreign exchange risk study which was later instrumental in defining a new scheme. However, Government did noc fulfill its commitments to make payments to BDET for losses due to exchange rate changes, because of a very tight budget situation. Despite repeated commitments by Government to pay its arrears related to foreign exchange losses on external borrowings, the situation worsened. Only in 1988 was the Treasury able to make payments to BDET ( DT 19.2 million) which exceeded BDET's losses in that year (DT 15 million ). In 1992 Government's accumulated debt to BDET, was DT 54 million, considerably greater than when the project was appraised. For many years during implementation, these arrears had a serious effect on BDET profitability, however, now as a result of an agreement reached to settle the arrears and to compensate BDET for Government's failure to make timely payments in the past, there should be little impact on BDET's overall financial situation. 8. Performance of the Bank 8.1 Project Preparation and Appraisal. The Bank established the need for the credit line and the technical assistance components based on experience under the first Electrical and Mechanical Industries Project and extensive sector work completed in 1980. Projections for future investments were based on pipelines presented to the Bank in 1985, during negotiations, and approvals of Investments by Agence de Promotion des Investissements (API) for 1986 and beyond. With hindsight, the Bank should have paid more attention to i) the uncertainty of the pipelines, for many projects had not yet been approved, ii) the relationship between the size of the loan and the projected investment demand, and iii) the Tunisian's request to have a more flexibly designed credit line, similar to the First Electrical and Mechanical Industries Project. Furthermore, the Bank should have been more cautious in making a targeted line of credit to EMIs three and a half times larger than the previous line directed to EMIs. 8.2 Pro-ect Implementation. A review of the subproject appraisal reports, the approval process and documentation available in Bank files reveals a lack of consistency in the Bank's subproject examination process. Bank staff requested pertinent additional information, so that it could make a fair assessment of each project. However, on several occasions, including the review of the MAKLADA loan, the projects were approved without receipt of written correspondence that provided all additional information requested by the Bank. Possibly this could be explained by the Division's poor system of filing project documents and related correspondence. More than two thirds of the projects did not have separate files which would have facilitated easy access to earlier correspondence. Some projects were also pending for as long as a year and appeared to have been reviewed by different staff. Under these circumstances, maintaining proper files would have been especially helpful and  10 possibly would have led to the Bank's refusal of sub-projects that were subsequently approved. Records on the finding of supervision missions were also absent from the files, possibly because in the later years pre-appraisal missions for the Industrial Finance Project were also coupled with supervision missions, thus creating additional demands on staff. 9. Prolect Sustainability 9.1 The issue of sustainability of the project can be viewed from two perspectives: the broad based objective to encourage the development of the sector and the aim to assure ample resources to economically and financially viable enterprises. The later objective was met and appears to be sustainable. Sub-project documents approved by the Bank indicate that the sub-projects which received Bank funds would have rates of return well-above the minimum rate required. Furthermore, preliminary results of sub-projects' operations, for two of the development banks, indicate that the EMI sub- projects should meet the minimum financial rates of return criteria over their lifetime, even though they are not preforming as well as initially anticipated. 9.2 From a broader prospective, the development of the sector as initially envisioned in the SAR, was not fully met and thus is not entirely sustainable. More recognition should have been given to the difficulty in encouraging the development of a particular sector by essentially providing only financial resources to the development banks and sector specific institutions. During the later half of project implementation, many committed projects were cancelled and fewer projects emerged, as enterprises anticipated and adapted to new industrial policies that sought to create a more liberalized and outward-oriented economy. 9.3 As for the sustainability of the three development banks, whether they will continue to intermediate funds will depend on continued improvements in their abilities to appraise and supervise projects, as well as their capacity to adequately provision for bad loans. 10. Lessons Learned and Recommendations for Future Pro-ects 10.1 Credit line operations should be open for all private sector investments, unless a targeted line can be fully justified: as a result of the narrow scope of the credit line component, the resources were not used. A larger general line of credit is preferable to a group of targeted lines of credit, for reasons of flexibility among others. Three successive loans, the EMI, Export Industries, and Small and Medium Scale Industries (SMI II) had overlapping objectives and, in hindsight, could have easily been substituted by a general line of credit that would have offered greater flexibility to the development banks and better served their resource needs. To date, Government cancelled a large portion of the Export Industries Project as well, but SMI II has been committed and disbursed well ahead of schedule, which is a good indication that the SMIs would have absorbed the slack in investment demand from EMIs and Export Industries, had the three projects been consolidated into one.  I1 10.2 Bank management should ensure adequate and reaular supervision missions with continuity in staffina and staff should be fully responsible for properly maintained files and timely and through reviews of sub-projects. Additional supervision missions and improved reporting may have deepened the relationship between the Bank and the development banks, with the benefits of further improvement in their appraisal and supervision procedures and higher quality of their portfolios. Better maintenance of Bank files would also have raised the quality of the review and approval of sub-projects financed under the loan. Had more summaries of projects been prepared by Bank staff, the Bank's own supervision would have been improved immensely. Long delays in approving sub-project could also have been avoided. 10.3 Supervision missions should also carefully verify compliance with all covenants. Quota restrictions continue to exist for products manufactured by electrical and mechanical industries. The benefit of these restrictions for the subprojects has not been reviewed or discussed in the course of Bank supervision, although during appraisal this was a key issue. In response to concerns of the inefficiency of manufacturing industries, a covenant and supplemental letter was agreed upon to ensure the efficient development of industries, through Government monitoring of pricing policies based on international reference prices. Generally, this type of covenant is difficult for the Bank to monitor, given the short window between project closing and the full operation of sub-projects. However, in this project where closing was delayed, it was an oversight to exclude discussing compliance with the covenant in the last two supervision missions. 10.4 The design of foreign exchange risk schemes should be an integral part of the desian of credit line operations, and such schemes should reasonably compensate Government for bearing the foreign exchange risk. Government's payments to BDET for foreign exchange losses that were incurred as a result of Bank and other external loans, were untimely and in many years reduced BDET's profitability. While full compensation to BDET is now expected, Government ability to repay would have been vastly improved by the existence of a foreign exchange risk coverage scheme that approximated a market-based scheme. An annual premium paid by BDET for the foreign exchange risk coverage was warranted, but for many years BDET paid no premium to Government to bear the risk.  12 PROJECT COMPLETION REPORT TUNISIA: ELECTRICAL AND MECHANICAL INDUSTRIES PROJECT LOAN 2554-TUN PART II REPORT OF THE BORROWER  13 SOCIETE TUNISO-SEOUDIENNE D'INVESTISSEMENT ET DE DEVELOPPEMENT PROJECT COMPLETION REPORT WORLD BANK LOAN NO. 2554-TUN SECOND ELECTRICAL AND MECHANICAL INDUSTRIES PROJECT PART II DEVELOPMENT AND MONITORING DEPARTMENT December 1993 PROJECT COMPLETION REPORT ON LOAN WORLD BANK NO. 2554-TUN  14 TUNISIA: SECOND ELECTRICAL AND MECHANICAL INDUSTRIES PROJECT I. OBJECTIVE This paper seeks to provide a summary presentation of the project completion report for the World Bank's Second Electrical and Mechanical Industries Project in Tunisia. II. BRIEF DESCRIPTION OF THE LINE OF CREDIT 1. This line of credit was made available to finance projects in the EMI sector. * Amount of the credit line = US$54 million, of which US$15 million onlent through STUSID * ~A.Duration: 17 years, including four year's grace * Charaes and interest: - interest = cost of IBRD resources + 0.5% - commitment charge = 75% per annum on the undisbursed amount of the loan * The date of sianature of the credit line was July 9, 1985 * The effectiveness date of the credit line was June 4, 1986 * The date of first disbursement on the credit line was September 27, 1988 * The loan closing date was June 30, 1993. 2. The project objectives were: - to promote the development of the electrical and mechanical industries (EMI) through the financing of financially sound investments; - to support the services provided to the EMI sector by the Centre Technique des Industries Mecaniques et Electriques (CETIME) and the Institut National de Normalisation et de la Propriet6 Industrielle (INNORPI); - to assist in the introduction of improvements in the policy framework for the operation of EMIs.  15 The project included the following parts: Part A: The granting by the participating development banks (BDET, BTKD and STUSID) of sub-loans for the financing of EMI projects. Part B: CETIME Development and improvement of the Centre's activities through: - the construction of a mechanics laboratory, a unit for the production of metal tools for foundries and an electronics division; - the extension of technical assistance through the provision of expert services in the areas of electromechanical construction, mechanical construction and foundries. Part C: INNORPI Expansion and improvement of the Institute's services through: - the establishment of a metrology service, including the training of staff; - the construction of a laboratory for testing EMI products; - the provision of expert services in the areas of quality management and control. 3. The Loan: The World Bank (IBRD) made a loan available to the Government of Tunisia in various currencies in an amount ecauivalent to USS54 million. The effectiveness of the Loan Agreement was also contingent upon the signature of the subsidiary financing agreements (onlending agreements) between the Government and the participating development banks. The loan closing date, scheduled originally for June 30, 1992, was extended to June 30, 1993. Revavment of the vrincipal was done on a six-monthly basis (every May 15 and November 15), beginning with November 15, 1989 and running until November 15, 2001, in constant amounts, plus a last payment on May 15, 2002. The duration was therefore 12 and 1/2 years beginning in 1989.  16 Commitment Fees: The Government of Tunisia paid IBRD a commitment fees of 0.75% per annum on the principal of the loan not yet utilized (payable on May 15, and November 15). Interest Charges: The Government of Tunisia is paying interest on the principal amount of the loan withdrawn and outstanding at an annual rate, for each interest period (May 15 and November 15), at one-half of 1% over the cost of IBRD reference loans in the last six-month period ending before the beginning of the afore- mentioned period of interest. Financing: The loan was to be used to finance the following categories: Categories Amount Allocated X of Expenditures Financed (1) Subloans Under Part US$50,000,000 100% of the amount A of the Project disbursed by the development bank on account of eligible expenditures (2) Consultants' US$2,100,000 100% of foreign services and goods expenditures and 70% of under Part B of the local expenditures Project l (3) Consultants. US$1,900,000 100% of foreign services and goods expenditures and 70% of under Part C of the local expenditures Project With regard to Category (1), under Part A of the Project, in virtue of the subsidiary financing agreements that were to be concluded between the Government and the three participating development banks, the Government onlent: to BDET, the equivalent of some $20 million to BTKD, the equivalent of some US$15 million to STUSID, the equivalent of some US$15 million The amounts allocated to the development banks were to be used in assisting EMI enterprises to carry out EMI projects. An EMI enterprise was defined as any enterprise in the electrical or mechanical sector in which less than 50% of the equity was owned by the Government or any of its departments or agencies.  17 Eligible EMI Proiects - any project undertaken in one of the priority subsectors or an industrial activity producing non-consumer electrical or mechanical products protected by a tariff on equivalent imported products of not more than 18% (or 21% in the case of the metal construction and boiler works-subsectors) at the time of the Bank approval of the subloan; - any project in a non-priority subsector, but which is expected, in accordance with a methodology satisfactory to the Bank, to export not less than 30% of its products, if the EMI project is carried out by a new EMI enterprise and if not less than 50% of its incremental production if it is carried out by an existing EMI enterprise; - the projects were to have an IRR 2 12% and ERR 2 10%; - eligible projects were to have an estimated total investment cost of no more than the equivalent of US$20 million. Eligible Expenditures - the reasonable cost in foreign exchange for direct imports; * 70% of the invoice price of goods purchased in Tunisia but imported previously; - the portion of the cost of goods manufactured in Tunisia representing the cost in foreign exchange of imported inputs for the manufacture of those goods, that cost being calculated in a manner satisfactory to the Bank in the appraised report for the EMI project; - 60% of the cost of construction works; - expenditures made after the date of Loan Agreement; - expenditures made at the latest 90 days before the date on which the World Bank received the request and requisite documentation. The Subsidiary Financing Agreements The subsidiary financing agreements stipulate that the development banks, each acting on its own behalf: - reimbursed the equivalent in dinars (determined on the respective date or dates of withdrawal from the loan account) of the currency or currencies withdrawn from the loan account for amounts paid under the subloans, during a period not to exceed three years and in accordance with an amortization schedule that essentially conforms, as regards to the pertinent dates, to the relevant schedules for the subloans granted;  18 - pay the equivalent in dinars (determined on the date of payment by the Government to IBRD) of the commitment charge payable by the Government to the Bank on the undisbursed portion of the loan onlent to it; - pay an interest on the amount onlent to it under its subsidiary financing agreement at a rate equal to the interest rate applicable to the loan; - implement the measures decided by the exchange risk study. The Subloans A free-limit subloan is a subloan made in an amount of less than US$750,000; however, regardless of their amount, the first three subloans made by each development bank were not to be treated as free- limit subloans. Each request for withdrawal of funds from the loan account in conjunction with a free-limit subloan was required to include: - a brief description of the EMI Enterprise and the EMI project, in particular, a description of the expenditures to be financed through the proceeds of the loan; the conditions accompanying the loan, including the pertinent amortization schedule; * the other subloans were to be subject to approval by the IBRD on the basis of an appraisal report that had to include in particular; - the structure of share capital, the cost of investments (total cost and cost in foreign exchange) and the financing plan; - *description of the goods to be produced and, for products manufactured in Tunisia and to be financed by the subloan, the cost of imported inputs; - a detailed analysis of the market and a marketing plan; - an estimate of the number of jobs to be created and the average cost; - a detailed study of the financial and economic rate of return of the project (including calculation of the IRR and ERR); - a detailed description of the protection accorded to the project, specifying the fees and taxes charged on imports in the case of importation declarations and quota restrictions (level, schedule, duration of quota restrictions) in the case of import licenses;  19 - in the case of projects protected by import licenses and quota restrictions, the comparable prices in foreign exchange were to be specified and compared to the projected prices of products under the project; - the non-confidential characteristics of the technical assistance or the licensing contract signed with the foreign partner were to be furnished in order to allow for a review of issues related to the specifications and quality standards of the products; - at the request of IBRD, a simplified calculation of the level of actual protection enjoyed by the project (with the prices in foreign exchange used solely for marketable inputs and products but not for the capital and labor factors of production); - for EMI projects in the mechanical and platework subsector, the technical assistance program proposed by CETIME (including the scope and implementation timetable for the above-mentioned program) and agreed between the participating development bank and the EMI enterprises applying for the subloan. The documentation and request for financing were to be submitted to IBRD by June 30, 1989 at the latest. Terms and Conditions of the Subloans - The subloans were to be granted for a period not to exceed 14 years, including a maximum of three year's grace and carrying an actual interest rate of at least 12%. - The subloans could not exceed the equivalent of US$2 million. The subloans for a given EMI project could not exceed the equivalent of US$4 million. - The participating development banks were to send for prior approval of IBRD all major changes envisaged by them with regard to the repayment conditions of any subloan. In the event that: (i) The foreign exchange loss risk is transferred to the development banks with regard to any amounts granted to them under the subsidiary financing agreements; or (ii) the Government charges the development banks a fee, the development banks were to ensure that the above-mentioned risk was transferred or that the fee was passed on to the sub-borrowers.  20 III. PROJECT IMPLEMENTATION 1. From the outset, the project experienced considerable delays: (i) With regard to effectiveness: The Loan became effective only on June 4, 1986 following the signature of the onlending agreements (May 16, 1986), i.e. nearly one year after the signature of the loan agreements (July 9, 1985). This delay was due essentially to circumstances connected with BDET's situation, as well as the approval of the guarantee agreements by the House of Deputies. (ii) With regard to approvals of commitments: The first financing appraisal reports were sent in March 1986; the World Bank did not notify us whether they had been approved until one year later (March 1987). During that time, the World Bank was undergoing a reorganization. 2. That delay undoubtedly had a negative impact on the proper utilization of the line of credit, although it was Tunisia's economic slowdown in late 1986-1987, which coincided with the start-up of commitments of the line of credit, that considerably impeded the normal use of the line. 3. Numerous factors limited the utilization of the EMI credit line: In addition to the delays in the start-up of the line of credit and the economic downturn in Tunisia, the other factors that hindered credit line operations were: (i) Very restricted eligibility criteria formulated in the loan agreements. In particular, two subsectors were distinguished: - a priority subsector: the projects in this subsector were those that produced capital or intermediate goods (defined in reference to similar goods for which the import custom duties were less than 18%). Expenditures in foreign exchange for such projects were eligible for refinancing under the EMI line of credit; - the non-priority subsector: the complement to the priority subsector in the EMI sector. In order to be eligible for financing under the line of credit, projects in the non-priority subsector had to meet criteria with regard to exports: - the export of at least 30% of production for projects carried out by a new EMI enterprise;  21 - the export of at least 50% of incremental production for projects carried out by an existing EMI enterprise. When compared with the export line of credit, the EMI line of credit appears to be an export sub-line, with the difference that it is limited by sector and that it finances projects producing capital goods (which is rare in Tunisia). This all underscores the fact utilization of the EMI line of credit, in addition to its sectoral constraint was highly restricted. (ii) The new obstacles posed by the World Bank After the loan agreements became effective, the World Bank established new restrictions, including: - the non-eligibility of Tuniso-Algerian projects; - the non-eligibility of projects upstream or downstream of the automotive sector. These new obstacles were a factor in the under-utilization of the EMI II line of credit. (iii) The difficulties inherent in the proiects in the EMI sector The projects in the EMI sector were the hardest hit by the restructuring of the Tunisian economy; the percentage of loans cancelled was quite high: by the end of 1987, nearly 25% of STUSID approvals for the EMI sector had been cancelled. (iv) Rigidity of approvals under the EMI line of credit This rigidity was due to the setting of a deadline for commitments (June 30, 1989) that was very remote from the loan closing date (June 30, 1992 at first, and later extended to June 30, 1993). Thus, despite the upswing in investments in the EMI sector in the last half of 1989 and especially in 1990, several projects could not be approved because of the commitment deadline, which was not extended in the amendments of August 16, 1989. 4. Cancellations and amendments to the EMI line of credit Owing to all these difficulties and the slow use of the line of credit, STUSID and the other participating development banks requested successive cancellations from the amount of the credit  22 line as well as amendments, so that the portion remaining could be better utilized. (i) Amendments to the loan agreements and iprolect agreements * The requests for amendments formulated in March 1988 involved the following points: - cancellation of a part of the loan: US$5 million for STUSID; - extension of the commitment deadline to June 30, 1990 instead of June 30, 1989; - extension of the utilization deadline to June 30, 1993 instead of June 30, 1992 (closing of the loan); - greater flexibility in requirements with regards to customs duties, in particular expansion of the priority subsector to include projects with a protection rate of less than 25% (instead of 18% and 21% in the loan agreements); - expansion of loan utilization to applications for reconversion and rehabilitation projects, as well as projects involving industrial maintenance and services. * The amendments to the EMI II Loan, finally concluded on August 16, 1988, only partially reflected the requests indicated above. (ii) Partial cancellations of the credit line The amount of the credit line actually utilized is US$4,843,629. Cancellations totalled $10,156,371, and were made on the following dates: Cancellation of March 22, 1986 US$5,000,000 Cancellation of February 15, 1989 US$4,055,345 Cancellation of June 30, 1990 US$1,101,026  23 5. Utilization of the EMI line of credit (US$ 000) Withdrawals Cumulative withdrawals for the year 1988 555 555 1989 627 1382 1990 2551 3933 1991 114 4047 1992 797 4844 1993 (06/30/93) 4844 i.e. a utilization rate of 32.3% of the initial amount of the line of credit and 62% of the amount following the 1988 and 1989 cancellations.  24 Glossary of French Terms in Tables Approbation Approval CoOt final d'investissement Final investment cost Decalssements Disbursements D6signation projet Project name Emplois crees Jobs created Engagements Commitments Imputations Commitments Montants des arrier6s de 1'entreprise Amount of arrears of sub-borrower Observations Comments P;riode d'amortissement du sous-pret Amortization of subloan Projets soumis et approuv6s Projects submitted and approved Taux d'interet du sous-pret Interest rate on sub-loan  25 Ann3xI Page 1 of I STUSD-OOs 'Situenoneu 31/1/93) | f TAD 11T,'?SL1A 7ION DF IA ZI IAEP Df CEfDIT ffIA' -it/-E II N 2'.554 PROJETS SOUMIS ET APPROUVES FINANCEMENT ItMPUTATIONS DECAISSEMENTS H IDESIGATION PROJET STUSID(I000DT) (1000 S US) (1000 $ US) OBSERVATIONS N. J,DESIGKATION Approb. Debours DOte Montent Date ler deb. bontent cI rlATAFI 558 558 14-08-87 555 27-09-88 55 Cz 01 NT3 DE CARDAN t160 330 9- f 2- 87 302 23- 05- 90 257 CS OITILS DE COUPE 528 528 23- 5- 87 593 23- 05- 90 549 Cs |KADA 1 741 1 741 28-10-88 1 178 26-06-90 1 178 Cs TUB