Announcement of Joint Financing for Cameroon Palm Oil Project on March 19, 1969

) .. ,_, "' /· • 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank Press Release No. 69/18 Subject: Joint financing for Cameroon March 19 , 1969 Palm Oil Project A project for the commercid development of palm oil, mainly to meet Cameroon's expanding domestic demand for edible fats.· will be financed jointly by the World Bank ($7.9 million), two French agencies. Fonds d'Aide et de Cooperation (FAC) ($1.8 million) and Caisse Centrale de Cooperation Economique (CCCE) ($1.8 million) and the Cameroon Government ($2.4 million). In addition to stemming the country's declining output of palm oil, the project w:Ul have a substantial impact on agri- cultural development in the forest areas of East Cameroon which are sparsely popu- • lated and ill-suited to the growing of othor crops • The project consists of an eight-year planting program of oil palms on two estates totaling 22,400 acres, the construction of an oil mill on each estate, and the provision of roads, buildings and other infrastructure. At full development in 1981 the annual output of oil mills will be about 26,000 tons of palm oil and 6,000 tons of kernels. Also permanent employment will be provided for about 2,000 workers, giving them better living conditions and a cash income. Much of their wages will be spent on foodstuffs which will stimulate foodcrop production in the vicinity of the estates and elsewher·~. Agriculture is the main occupation in Cameroon and accQunts for over a third of gross domestic product. In recent years food production has kept pace with the growth of population. Cameroon also produces a well diversified range of export crops, including coffee. cocoa, bananas and cotton. However, the e~pansion of • many crops is limited by climate, soil and marketing conditions. /more Bank P.R. No. 69/18 • Cameroon-Palm Oil Project World Bank Group. - 2 - This is the second agricultural project in Cameroon to be assisted by the Two years ago the Bank and the l~ternational Development • Association lent $18 million for the expansion of plantationa/)n West Cameroon, operated by the Cameroons Developnent Corporation, which will more than triple the acreage planted to oil palm, rubber, tea and pepper to a total of 81,800 acres. The World Bank loan of $7.9 million will be extended to Societe des Palmeraies de Mbongo et d 1 Eseka (SOPAME), a corporation expressly _set up by the Govermnent to carry out the project, and will be guaranteed by the Federal Republic of Cameroon; it will be for a term of 30 years including a 10-year grace period, and bear interest of 6-1/21.. The French contributions will be made to the Government which will transfer the funds to SOPAME. FAC's contribution of $1.8 million will be in the form of a grant; CCCE will make a loan of $1.8 million for a term of 21 years, with 9 years of grace, and at a rate of intere·st averaging 4%. annually. • The Fren.c::h Government assisted Cameroon in the preparation of the project by financing a feasibility study. A specialist from the Food and Agriculture Organi- zation ~t· the United Nations (FAO) was a member of the apprtisal mission under the Bank/FAO Cooperative Program. - 0 - •