Central African Republic - Education Project

RESTRICTED CIRCULATING COPY Report No. P-1052 TO BE RETURNED TO REPORTS DESK FILE COPY This report is for official use only by the Bank Group and specifically authorized organizations or persons. It may not be published, quoted or cited without Bank Group authorization. The Bank Group does not accept responsibility for the accuracy or completeness of the report. INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDf r TO THE CENTRAL AFRICAN REPUBLIC FOR AN EDUCATION PROJECT M,z.ch 30, 1972  INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE CENTRAL AFRICAN REPUBLIC FOR AN EDUCATION PROJECT 1. I submit the following report and recommendation on a proposed credit to the Central African Republic (C.A.R.) for the equivalent of US$3.9 million on standard IDA terms to help finance an education project. PART I - INTRODUCTION 2. Following a Bank reconnaissance mission in December 1969, a UNESCO mission reviewed the educational objectives and priority needs of the Central African Republic in June 1970. In February 1971, the Govern- ment requested IDA assistance for an education project prepared in con- junction with UNESCO. During appraisal in May 1971, it was found necessary to modify the Governmentls original proposals, largely because of the increase in current expenditures entailed. WflJith the Government's agreement, the project was modified in order to limit the claim on the Government's budget while still providing assistance for priority needs. Negotiations with a delegation led by Mr. Frangois Pehoua, then Minister of Planning, International Cooperation and Statistics, were completed on September 24, 1971. Presentation of the credit to the Board, originally scheduled for late 1971, was deferred pending the outcome of consultations wibh the Government on its deteriorating financial and budgetary situation and the adoption of a stabilization program in agreement with the IMF. 3. The proposed credit -ould be the first Bank Group assistance for education and the third IDA operation in the C.A.R. (Annex I contains a summary of IDA credits to C.A.R.). A $4.2 million credit (Credit 146-CA) for the reconstruction of the Bangui - M?Balki road and a $4.3 million credit (Credit 199-CA) for highway maintenance were signed in April 1969 and June 1970, respectively. Construction of the Bangui - MtBaili road is on schedule,although there was some initial delay caused mainly by the need to re-tender the work,following the devaluation of the French and CFA francs in 1969. The Government has sometimes delayed in paying the contractor, but payments are now being made regularly. It is expected that construction will be completed by August 1972, wiell in advance of the Closing Date of March 31, 1973. Considerable delay was experienced in starting work on the Highway Maintenance project, because of tardiness in establishing a Road Fund required under the Credit Agreement. 'When the project was last supervised (October 1971), these problems had been resolved, the maintenance contract had been awarded and progress was satisfactory. To ensure successful implementation of the project, per- formance and future planning under the highway maintenance program will be  reviewed dwring semi-anual meetings of a Coordinating Comndttee of represen- tatives of the 3overrment, the consultants and the Association. 4. 'MThe main developnent potential in the C.A.R. lies in cotton, coffee, live3tock, forestry and diAmond production. The main development constraints lie in transportation and human resources. 5. For a landlocked country of the size of the C.A.R., internal road transportation and road and river transport links to the sea will have to be expanded to exploit the country1 s potential to the fullest. Accordingly, the most recent IDA credit (199-4A) contains funds for a feasibility study and detailed engineering for the improvement of the Bossembele - Bangui road; the consultantst feasibility report is nearing completion. Increases in the capacity of the river fleet will be necessary in line with improvements in river, port and rail facilities planned by ATC (Agence Transcongolaise des Comnum.nications), the national transport agency of the People's Republic of the Congo. 6. The shortage of trained mnpower is a fundamental obstacle to develo7ent in all fields and the C.A.R. is heaJvily dependent on expatriate personnel in both the private and public sectors. The proposed education project will support the Government's long-term objective of reducing this dependence and in so doing will make an important contribution to overcoming the human resource constraint on development. 7. Following the two credits for road development and the current education project, the Bank Groupts activities will Locus increasingly on agriculture anda livestock. In agriculture, a start has been made in the identification of a cotton project, a ranch project, and a project aimed at improving stock routes between the C.A.R. and Chad. The Bank is also considering a Government request for assistance in developing a second power plant on the N'Bali River, in view of the anticipated shortages of electric power in Bangui, the capital. The pace of future IDA lending will be determined from time to time in the light of the Government's progress in restoring the public finance situation (see para 10). 8. The C.A.R. Governxent has undertaken a series of nationalizations. The dates of nationalization and status of settlement are as follows: (a) SociAtS Equatoriale drEnergie Electrigue (SEEE) in 1967. An agreement has been reached; (b) Union Electriqu.e dTOutre Her (UNELCO) in 1967. The Government recognized the principle of compensation, but settlement has not been reached on the evaluation of the assets; we understand that the Government has recently con- tacted UBIMWO; (c) Aence Trans6auatoriale des Communications (ATEC) in 1969. The Government withdrew from the convention establishing the ATEC, a multi-national trwnsport agency jointly established  with the Congo, Gabon, and Chad. The Government took over ATEC Is transport facilities located on its territory and set up a national agency, Agence Centrafricaine des Communications Fluviales (ACCF), to run them. ACCF is continuing transport services to the former ATEC partners under a series of bilateral agreements which have led to satisfactory cooperation; (d) Compagnie Generale des Transports en Afrique Equatoriale (CGTAE) in 1969. 4iile withdrawing from ATEC, the Governments of the C.A.R. and Congo nationalized CGTAE. Agreement was reached in December 1971; (e) Diamond Distributors Incorporated in 1969. All diamond mines in the C.A.R. were closed by the Government following a dispute over mining rights. Agreement was reached in March 1972 between the Government and Diamond Distributors Incorporated resulting in the formation of a joint company. The Bank will continue to follow closely progress in the settlement of the outstanding dispute. PART II - THE ECONOMY 9. The last economic mission visited the C.A.R. in 1969, and report AW16a, "The Economy of the Central African Republic", was distributed to the Board on May 22, 1970. Since then, we have monitored the economic and financial situation with the help of several short missions, the latest being in March 1972 when, at our initiative and including Bank participation, a special IWF mission visited the country (see para 12). 10. Our main concern recently has been with the growing deterioration in the C.A.R.'s financial and budgetary condition. This reached a point where, by late 1971, we felt the need for a full review of public finances and assurances about improvements before we could process further IDA credits, including the education credit now prcposed. 11. Between 1967 and 1970, revenues rose at a 6% annual rate, probably in excess of the growth in GDP. In 1971, the Government had some success in stepping up tax collections, but revenues grew by only 5% , and expenditures, mainly for personnel and for purposes not closely related to development, rose by over 16%, compared to an annual increase of 10 in 1967/70. The result has been a continuously growing deficit. Thus, for 1971, the overall deficit amounted to CFAF 3.0 billion, equivalent to 27% of budgetary receipts, By the end of 1971 accumulated arrears in payments amounted to some CFAF 8 billion. If no reform had taken place in 1972, the consolidated deficit of the Government and state enterprises might have reached some CFAF 6 billion in FY-72. This situation was in large part due to the system of budgetary management under which Government agencies frequently placed orders without proper authorization.  - 4 - 12. The Government had introduced a program of austerity measures in 1970, including a freeze on new personnel recruitment (with some excep- tions), reductions in scholarships, limitation on expenditures for repre- sentation abroad and elimination of official cars. However, this decree, still valid in 1971, was not always enforced and did not produce the expected results. By October 1971, the Treasury had virtually exhausted its liquid resources. Borrowing from the Central Bank had reached the statutory limit. In an effort to meet its monthly wage bill, the Government stopped payment on all non-personnel expenditures. The Government subsequently requested that an fMF mission visit the C.A.R. to draw up a financial rehabilitation program. This mission, with which we cooperated closely, has now produced a stabilization program (described below), which has the approval of the Government. Measures are currently underway to implement the program. 13. Under the new stabilization program decided upon by the Government, receipts in the current fiscal year are to be increased by CFAF 1.9 billion, and expenditures are to be cut by CFAF 1.3 billion. The main increases in receipts are expected from a doubling of the average additional tax on imports,which is expected to yield CFAF 700 million more in revenues, a doubling of the turnover tax on enterprises,to yield another OFAF 450 million,and improved collection of arrears,to yield CFAF 500 million over the budgeted figure. 14. Expenditures are to be reduced for state employees, embassies, and government construction. The deficit of the state enterprises is to be eliminated by terminating an airplane lease, cancelling the order for a hospital ship and increasing prices charged by state transport and marke- ting agencies. As a result of these measures, the current budget is expected to show a surplus of CFAF 1.1 billion, and the overall treasury position, excluding debt payments, will be in balance. 15. Arrangements have been made for the payment of current debts and for funding part of the arrears, in the amount of some CFAF 1.6 billion during 1972, compared with payments of OFAF 530 million in 1971. 16. Negotiations are underway with the French Caisse Centrale de Cooperation Economique for payment of some CFAF 250 million of arrears and CFAF 348 million falling due in 1972. The Central Bank has been asked to raise the ceiling on advances to the Government temporarily from 10 to 15% of the previous yearts budget receipts, which would yield about CFAF 500 million. Foreign budgetary assistance is to be requested for the remaining CFAF 1.1 billion of financing needed in 1972. Local private suppliers are to receive negotiable 3% treasury bonds payable in 3 yearly tranches for the amounts owed them. 17. These first steps are to be followed by a review of the tax system, the budgetary procedures and control mechanisms, and financial administration. The Government has requested the services of a financial adviser and a tax expert from the DIF to assist in carrying out the policies and measures contained in the program.  18. Now that measures are under,zay to restore the C.A.R.'s public finances, a new effort can be made to exploit the country's develop- ment potential. The C.A.R. has fairly good natural resources. Ecological conditions are favorable to the development of agriculture and, to some extent, of livestock. Forestry and mining, especially diamonds, offer good possibilities for export diversification. Agriculture continues to be the most important activity, contributing some 30% of the gross domestic product. The lack of direct access to the sea is a serious handicap. The sole practical route is the 1,800 km river and rail route (Transequatorial Route) from Bangui, the capital, to Pointe Noire in the Congo. 19. The money economy is small, providing wage earning employment for less than 5% of the population. The bulk of the population still lives in the subsistence sector, although some of them are also engaged in dia- mond digging. Cotton and coffee are tbhe main cash crops,accounting for about 23% each of foreign exchange earnings. Diamond exports account for about 40% of total exports, but production has declined in recent years because of calflicts with the mining companies, wshich have however been settled recently. Large areas have been reserved for diamond exploration by the joint company (see para 8) and the outlook for diamonds is once again promising. Timber exports provide 5% of foreign exchange earnings and prospects are favorable. Timber output rose from 280,000 m3 in 1970 to 309,000 mv in 1971, and a further rise may be expected, assuming improvements are made in the road and river transport systems. 20. In 1969-1970 a real growth rate in GDP of 3 - 4% was recorded. However, due in part to a drought, coffee and cotton output declined in 1971, and economic growth in that year was negligible. Coffee production in the 1970/71 season was probably about 10,000 tons compared to soine 12,000 tons harvested in 1969/70, and is expected to decline to some 6,000 to 8,000 tons in 1971/72. Cotton production fell to 54,000 tons in 1970/71 from a high of 59,000 tons in 1969/70 and is expected to fall further to about 50,000 tons in 1971/72. Shortages of meat and foodstuffs were reported last year. 21. Management deficiencies are an important reason for these declines in production, particularly since the departure of large numbers of expatriate personnel late in 1970. Progress in cotton, coffee and livestock will therefore depend, in part, on the ability of the Government to provide competent staff in sufficient numbers for extension services, research and administration. 22. The 1971-1975 development plan, now in the process of prepara- tion, foresees investment outlays of CFAF 78 billion, of which 68% are to be public and 32% private. The financing plan for public investment assumes that CFAF 17 billion will come from budgetary surpluses and public institution funds, including the Development Bank and the Stabilization Funds, CFAF 12 billion from external public loans and CFAF 19 billion from external public grants, leaving about 5 billion remaining to be found from external sources. The planned sectoral distribution of investment outlays is as follows: production (65%), transport and communications (20%), administrative and social equipment (14%) and general studies and statistics (1%).  - 6 - 23. In view of the Government's tight financial position and past experience on foreign aid commitments and disbursements, this plan appears to be too ambitious. It is unlikely that public savings can reach CFAF 17 billion over the next four years and foreign aid commitments would probably not exceed CFAF 2 to 3 billion annually, although the plans of major aid sources are not known. Furthermore, the absorptive capacity of certain key sectors, such as agriculture and animal husbandry, is now limited by the absence of technical personnel. Further, private investment will probably fall short of the planned CFAF 25 billion in view of excess capacity in the industrial sector. 24. The C.A.R.ts balance of payments has deteriorated since 1967. Despite the recorded increase in agricultural production and exports, the current account has always been in deficit, reflecting the rise in imports and the fall in diamond exports. Up to 1968, this deficit was offset largely by a net inflnow of public and private capital. In recent years, because of the deterioration of the financial and economic situation, private companies have shown a strong tendency to transfer funds abroad. As a result, the balance of payments had a deficit of CFAF 1.68 billion in 1969 and CFAF 0.77 billion in 1970, not-withstanding an SDR allocation equivalent to CFAF 0.44 billion. Data on the 197. balance of payments is not yet available but, in view of the improvement in the net foreign asset position, there are reasons to believe that it will show a surplus. This reversal is explained by a sharp decline in imports and an increase in export receipts, mostly from timber exports, the run-down of cotton stocks during the second half of 1971, and the utilization in February 1971 of the IMF gold tranche equivalent to CFAF 0.37 billion. The measures adopted for the financial rehabilitation program are also expected to help to gradually improve the negative net external asset position. 25. During the period 1964 - 1970,the C.A.R. received a total of CFAF 15.0 billion in external aid of which 80% or CFAF 12.0 billion was in the form of grants. This does not include French technical assistance, which is estimated at COAF 1.3 billion annually. The largest sources of aid were France and the European Development Fund, which accounted for 50% and 35g, respectively, of the total aid extended to the C.A.R. over the seven-year period. 14ost of tlhe aid was used for financing agricultural development, infrastructure and education. 26. The C.A.R. external public debt outstanding as of December 31, 1969, amounted to US$29.1 million. The ratio of debt service payments to export of goods and services was 3.9% in 1969 and 4.3% in 1970. In addition, the country has not paid part of its debt service in recent years. These debt arrears will be paid in the next couple of years, and will thus increase the debt service ratio. 3ecause of the country3s poverty and public finance limitations, the Government should seek to obtain future assistance,so far as possible,on concessionary terms, covering a high proportion of total project costs.  - 7 - PART III - THE SECTOR 27. As stated above (para 6), human resource development con- stitutes a major constraint. The population of about 1.6 million is in- creasing by about 2.4% per annum. About 70% of the economically active population is in the subsistence sector, mainly agriculture, and wage employment in the modern sector is estimated at only about 50,000. The training of Central African extension workers is a condition for the improvement of extension services and the successful implementation of projects in agriculture and animal husbandry. 28. Industry, which contributes about 16% of GDP, relies heavily on expatriate management and skills; about 75% of professional and techni- cal positions, 2VS of middle-level supervisory posts, and 17% of semi-skil- led posts are filled by expatriates. As mary as half of the small indus- trial enterprises (employing 10-20 people) and almost all enterprises employing more than 20 workers are foreign-owined. Because of the relative- ly high cost of expatriate manpower and the low interest rates, industrial investment tends to be capital-intensive. The Government's objective is to replace all foreigners occupying middle-level positions in industry and commerce by 1980. 29. In recent years the quantitative grouth of the education system has been very rapid at the primary level, where erfrollment now covrers about 73%t of the relevant age group. This growTth has had an adverse effect on the quality of education and has substantially increased the claims of the education sector on Government resources. Secondary school enrollment represents 4% of the relevant age group. Most of the curriculum development and planning is carried out by expatriates. Only about 23% of the primary school teachers are qualified according to the GovernmentTs standards. In secondary and technical education, almost all teachers are expatriate. 30. The principal aim of the educational system should be to provide trained manpower for economic development and the replacement of expatriates at a cost within the financial capacity of the country. To achieve this goal, the expansion of the primary school enrollment should be restrained while enrollment in secondary education should increase and more emphasis should be put on science and practical subjects. 31. The Government intends to prepare a long-term educational plan. It has already made the following decisions: (a) to limit primary enrollment expansion to 3% a year; (b) to rationalize secondary education by introducing a broader curriculum in the lower cycle; (c) to strengthen science teaching by concentrating the upper cycle courses in certain lyc6es; (d) to improve technical and commercial training;  - 8 - (e) to replace the expatriate teachers gradually, starting with the costly contract teachers; (f) to establish a National Institute of Pedagogy, mainly by merging existing institutions; and (g) to start schools of engineering and medicine in the university. \,lhile the plans for the National Institute of Pedagogy and for the university need further study, the policy decisions concerning primary, secondary, technical and teacher education are sound; when implemented they would improve the quality of education and help to meet manpower needs with minimum additional expenditure. PART IV - THE PROJECT 32. A report entitled "Appraisal of an Education Project in the Central African Republic" (PE-34a),dated Nlarch 27, 1972, is being distri- buted separately. A Credit and Project Summary is attached as Annex III to this report. The main objective of the proposed project is to assist the Government in the implementation of its educational policy (described in para 31 above), by preparing a long-term educational development plan, providing lowier secondary school facilities for a broader curriculum, adding facilities for science and practical subjects to the existing lycees, improving facilities for technical and commercial courses, and establishing a college to train secondary school teachers. 33. The project comprises the following items: (a) construction, furnishing and equipping of four new low^Jer secondary schools and extension of an existing one -- for 2,850 additional students, including the provision of boarding facilities and staff housing; (b) provision of additional facilities for science and practical subjects in four lyce4es -- to increase their capacity by about 380 students; (c) extension of the technical lyc6e -- to accommodate an additional 150 students; (d) construction of a new secondary teacher training college for about 150 students; (e) provision of technical assistance for project implementatiox and the preparation of a long-term educational development plan. 34. Project cost is estimated at about $5.4 million, including $1.1 million in duties and taxes. The estimated foreign exchange component is $2.8 million, or 52%, of the total cost. The proposed credit of $3.9 million would cover foreign exchange costs plus about $1.1 million of  - 9 - local costs, i.e. 72% of the total costs or 89% of total costs net of duties and taxes. The Government contribution of $1.5 million, or 26% of the $5.4 million total, would cover local expenses, including duties and taxes; in addition, the Government would carry increased recurrent costs of about $0.7 million annually after completion of the proposed project. 35. The cost of construction could be substantially lower if it proved practicable to use local timber instead of brick and concrete. However, the use of timber for school buildings in the C.A.R. is still in tlle experimental stage. Assurances have been given by the Government that the project architect will review the possibilities of using timber for civil works and his report will be sent to the Association for comments within six months of his appointment. 36. The new facilities to be provided in the lower secondary schools would allow the introduc-bion of a well-balanced curriculum with practical subjects, including home economics, commerce, elements of agriculture and "technology", that is simple metalwork, woodwork, and electricity, with some teclnical drawing based, as far as possible, on everyday objects within tlhe pupilts own experience. The Government wished to give a practical orientation to the new courses but the technology course it proposed appeared to be too theoretical. The Government has therefore agreed to revise the syllabus of the technology courses and to submitG itto the Association for review wiithin one year of signing the Credit Agreement. 37. The additional facilities for science and practical subjects in the lycees -.rould enable the education system to offer the curriculum, mentioned in para 36 in the lowxTer cycle. In the upper cycle, the project would reduce the present imbalance between the arts and science streams by properly equipping the lycee Boganda in Bangui and the lycees at Bambari and Berberati for science teaching. In these three institutions, where the upper secondary science streams are to be concentrated, two science (natural and physical) baccalaur4ats would be established. 38. The technical lycee would be expanded and provided with additional equipment to conduct terminal courses for mechanical, electrical. and civil engineering technicians and for accountants and secretaries. The project would re-equip the existing workshops and construct new facilities. 39. The Secondary School Teachers Training College (Ecole Normale Superieure - ENS) with a total capacity of 150 students, would provide a three-year training course for the lowrer level secondary schoolteachers. 4hen an adequate number of entrants with a baccalaureat degree became available, the course would be reduced to two years and the output would increase from 40 to 50.per annum. In cooperation erith the technical lycge, the ENS would then also train teachers in practical subjects. A lower cycle secondary school, C.E.G. (College d'Enseignement General), for 400 students would be built on the campus of the EN' to serve as a teaching  - 10 - practice school. The projected output of the ENS would permit the complete replacement of expatriate teachers in the lower secondary school cycle in the early 1980s. The Government has agreed to finalize a plan for the training of teachlers of practical, technical, and commercial subjects within one year of signing the Credit Agreemenit and send it to the Association for comment. 40. For the proper operation of the upper secondary cycle, most of the teachers required would be provided under bilateral technical assistance programs. As more qualified Central African teachers become available, expatriates would be replaced. 41. For the proper operation of the ENS, 13 teachers would be required by 1975. These would be recruited from Central Africans studying abroad. The Government has given assurances that more qualified Central Africans would be appointed as they became available. An adequate number of qualified and experienced teachers covering all disciplines (at least 15 persons, including the principal) would be made available to ensure the proper functioning of the ENS. 42. To assist in the preparation of a long-term educational plan, the project would provide for the services of an education economist for one year to advise the Government on the financing of education and on cost-saving measures. 43. A project unit would be established in the Ministry of Education to provide overall supervision of the project and liaison with the Association. A project director, an architect and a procurement officer, all acceptable to the Association, would be appointed on a full-time basis. Establishment of the project unit and the appointment of the project director and architect would be a condition of effectiveness of the Credit Agreement. The project unit would be provided with adequate supporting staff, including an accountant. The salaries of the project unit personnel and the operational expenditures of the unit would be included in the estimated project cost. 44. Design and supervision of civil works would be the responsibi- lity of a consulting firm of architects selected and commissioned on terms and conditions satisfactory to the Association. Contracts for civil works, furniture and equipment would be awarded in accordance with the Bank/IDA Guidelines for Procurement. In the C.A.R. there are a few large and competitive construction firms, mostly headed by foreigners, capable of carrying out the project. It is unlikely that contractors not already operating in the country would bid for civil works. It is expected that instructional equipment would be procured abroad and furniture in the C.A.R. or other member countries of the Central African Customs Union (UDEAC). Manufacturers of furniture' in these countries would be allowed a preference in bid evaluation of 15% over the c.i.f. price of competing imports from outside the customs union, or the existing rate of duty whichever is lower.  - 11 - 45. The proposed Credit iwould be disbursed on the basis of 80% of the cost of equipment, project administration and technical assistance and 69% of the cost of civil works and furniture. These per- centages would be adjusted as necessary to disburse US$3.9 million, or 72% of the project cost, whichever is lower. The project would be completed over a period of four and a half years. PART V - LEGAL INSTRUMENTS Ai'D AUTHORITY. 46. The draft Development Credit Agreement between the Central African Republic and the Association, the Recomnendation of the Committee provided for in Article V, Section 1 (d) of the Articles of Agreement of the Association and the text of a Resolution approving the proposed credit are being distributed to the Executive Directors separately. 47. The draft Development Credit Agreement conforms to the normal pattern of credits for education projects. 48. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association. PART VI - RECOMIENDATIOW. 49. I recommend that the Executive Directors approve the proposed credit. Robert S. NcNamara President Attachments Ciashington D.C. Iarch 30, 1972  ANNEX 1 SUMMARY OF IDA CREDITS TO THE CENTRAL AFRICAN REPUBLIC AS OF FEBRUARY 293 1972 Credit Amount (US$ million) Number Year Borrower Purpose IDA Undisbursed 146-CA 1969 C.A.R. Highway 4.2 1.9 199-CA 1970 C*A.R. Highway Mainte - nance 4.3 3.9* Total IDA Credits 8.5 Total Undisbursed 5, * This credit became effective in June 1971.  ANNEX II Page 1 of 2 CENTRAL AFRICAN REPUBLIC CQUNTItNDATA Area: 620,000 sq. km Political Statuss Independent Republic since August 13, aW4o Population: 1.6 million (1970 estimate) Rate of growith 2.h percent per annum Density 2.5 per sq. km School attendance as percent of the relevant age groupl/ Primary (6 - 11 years) 73 percent Secondary (12 - 18 years) 4 percent Gross Domestic Product CFAF 57.1 billion (1970 estimate) at current market prices Per capita CFAF 35,700 or $129 at 1970 exchange rate (US$ = CFAF 278) Real Growth Rate 1967/70 5.8 percent Money and Banking: The CAR uses the Commmnaute Financiere Africaine franc (CFAF) (in billions of OFAF) (end of the year) 1967 1968 1969 1970 1971 Money Suppl,y 5.9 7.2 6.6 7.5 7.2 Domestic Credit 7.1 8.8 11.2 13.h 10.2 Foreign Assets (net) 0.3 0.4 -2.5 -3.4 -1.6 Public Firnances 1967 1968 1969 1970 197/ Total receipts 8.2 9.2 10.1 10.5 11.0 Current expenditures 8.7 10.3 11.2 11.4 12.6 Current Surplus or Deficit -0.5 -1.1 -1.1 -0.9 -1.6 Capital Expenditures 0 0.3 0.3 0.7 1.4 Overall Surplus or Deficit -1.0 -1.4 -1.4 -1.6 -3.0 (11 months) Trade and Payments 1967 1968 1969 1970 Exports 8.9 10.5 10.9 9.5 Imports 12.6 11.8 11.7 11.1 Trade Balance -3.7 -1.3 -0.8 -1.6 / Government schools only. 2J For 1970 and 1971 receipts are on cash basis and expenditures on check issued basis.  ANNEX II Page 2 of 2 (in billions of CFAF) Foreign aid disbursements 1967 1968 1969 1970 X 2.1 1.7 2.6 1.7 Commodity concentration of exports (as percent of total exports) 1967 1968 1969 19702/ Diamonds 47 53 45 38 Cotton 23 23 25 23 Coffee 20 12 15 23 External Pablic Debt Amount outstanding (Dec. 31, 1969):US$29.1 million Debt service (1969) US$ 2.3 million Debt service ratio (1969) 3.9 percent of exports af, goods and services IMF .Position Quota: US$14. 1 million Drawings: US$1.44 million 1972 exchange rate: US$1 - CFAF 255.785 3/ Based on data for 11 months W Preliminary data  ANNEX III Page 1 of 2 CENTRAL AFRICAkN FXP3UBLI E)UCATION PRJWET CREDIT AM PREW T SUN4Y Borrower: The Government of the Central African Republic Amount: U543. 9 millio equivalent Beneficiary The Central African Republic Ternt and Conditions: Repayable in 50 years, including a ten-year period of grace, by sei-annual installments of 1/2 of I percent from July 15, 1952, to January 15, 1992, and 1-1/2 percent from July 15, 1992, to January 15, 2022. Service Charge: 3/4 of I perceent per annum Projectt Construction of and equipment for (a) fcur new lower secondary schools and extension of an existing one; (b) additional facilities for science and practical subjects in four lyoees; (c) extension to the technical l]yc6e; (d) a new secondary teacher training college; and (e) provision of technical assistance for project implementation and the preparation of a long-term educational development plan. (in thousands of US$) Cost of Project: Local Foreign Total Site development iSo 80 260 Building construction 1,500 1,510 3,010 Project administration and professional serv-ices 200 340 540 Furniture l3lo 30 14,0 Equipment 130 380 510 Contingencies 450 480 930 2,570 2,820 5,390  ANNEX III Page 2 of 2 Local Foreign Total Financing of Project: IDA Credit 1,080 2,y20 3,900 Government 1,490* - 1 ,49o 2,570 2,820 5,390 Procurement Arrangements: Contracts for civil works,furniture and equipment, would be subject to international competitive bidding. Domestic manufacturers of furniture, including those of other UDEAC countries, would be accorded a margin of preference equal to the existing rate of customs duty applicable to com- peting imports or 15 percent of the c.i.f. price, whichever is lower. Disbursements: IDA Fiscal Year 1973 1974 1975 1976 1977 Cumulative Disbursements at end of year 31 226 2,149 3,569 3,900 (in 1000Is of Us $) Consultants: Project Unit to be set up in the Ministry of Education will be assisted by consultant architects. Appraisal Report: Report No. PE-34a dated March 27, 1972. Educa- tion Projects Department. March 30, 1972 * Of which about $1.1 million represents duties and taxes.  CENTRAL AFRICAN REPUBLIC EDUCATION PROJECT F R I dMBARAy/ \ } fW R N~~~~~~~~~~~~~~~~~~~~~~~~~~~~ s U2~_ FA Al _ Mbrld Il=I -d.,y T-6,, T. j O s.~~ ~~~ ~ ~ ~ ~ ~~~~~~~~~~~~~~ L: S.d, S,-1 BERBERAT \CD U ~~~~~~4 'L- S.ondoy Sd-,ol aANGUfl US L.- 5 ,doy Sd-1, 8AMBARI 0 6 E~,i -L-. S-d.,y ShI-1o, SrwrT Pl l rods _____Seconww ,oh R6 ~ A 7 E~oo- - Lyd. Bogocd., BANGUI 'LOal .c If= , mVods \' A ELSeti.. m1a,asd by ATEC A 9 E ~ - 8B.. Ii Lyc4o SCALE SCALE A10 E&ton-i Ly,4e 8ok-o aANGUI *S a to as vs a .s. as a to as To 300 ,. 8--fl. a ~0 II .ti - Ly.s1avAy. BANGUI MARCH 1972 IBRO) 3554R