Announcement of 10.5 Million Dollars Credit for Agricultural Development in Malawi on March 22, 1973

• INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 --------------------------------------------------· IDA Press Release No. 73/16 Subject: $10.5 million credit for agricultural March 22, 1973 development in Malawi The International Development Aasoc:i.ation (IDA), an affiliate of the World Ba.rue, i8 providing a credit of $10.5 million to Malawi for the second phase of the Shire Valley agricultural development project. The first phase, which IDA also helped finance, is being completed ahead of schedule with reduced costs and greater benefits than forecast when the project was appraised. The Shire Valley is an isolated area in southern Malawi. ?ttlawi, itself, is a small, land-locked country located between &l.mbia, 'l'anzania and Mozambique •. The first Shire Valley credit, of $3.7 million, was approved in 1968 for the $4.6 million development of crop production, mainly cotton, and benefitting some 9,600 farmers. The second phase will cost an estimated $13.5 million and will involve some 16,300 farm families on about 131,000 acres, as well as 1,000 fisherrren. The project includes a number of components: expanding extension services; providing seasonal and medium-term credit and market facilities to improve cotton, maize, sorghum, rice, groundnuts and cocoa production; increasing beef cattle production by about 1,800 head a year; raising the productivity of some 1,000 fishermen by the equivalent of 1,400 tons of smoked or dried • fish a year. To support the agricultural components, .the project includes: construction of staff housing, offices, workshops and 108 miles of feeder roads; conversion of a railway bridge over the Shire river to road/rail use; improvement of 82 miles of ma.in and secondary roads; drilling of 140 boreholes to improve rural water supply; increase health service by · conversion and construction of four primary health centers, 11 sub-centers, and'l6 health posts, together with improvement of a hospital service center; crop, pasture and fish- farming research; construction of 17 markets and,the renovation of three; assistance in building fishing boats; provision of additional facilities at game preserves; assistance in land registration. The project is expected to expand annual agricultural output in the area by about $4.7 million equivalent. Average net cash incomes of participating farm families will rise from an estimated $11 equivalent to a $95-$120 equivalent range a ye~r. The credit is for 50 years, including a 10-year grace period, and is interest-free except for a 3/4 of 1% service charge to cover IDA's administrative expenses. - 0 - •  March 22, 1973 PROJECT: TECHNICAL DAT A Shire Valley Agricultural Development Project -- Phase II • COUNTRY: Republic of Malawi TOTAL COST: $13.5 million IDA FINANCING: $10.5 million, 50 years, 10 years of grace; interest-frE!e except for 3/4 of 1% service charge to cover IDA's administrative expenses. OTHER FINANCING: Government of Malawi, $1. 7 million equivalent; Agricultural Development and Marketing Corporatio11 (ADMARC) -- a parastatal body wholly-owned by the Gov~rnment -- $1.3 million equivalent. IMPLEMENTING ORGANIZATION: Project will be implemented by the Project Manager, Ministiy of Agriculture and Natural Resources, Zomba, Ma.Law!, with assistance from the ministries of Health and of Works and Supplies, the Department of Fisheries, and ADMARC. PROJECT DESCRIPTION: Assist some 16,300 farmers in increasing production on about 131,000 acres of cotton, maize, sorghum, rice, groundnuts, • cocoa, and beef as well as assisting some 1,000 fishermen, through provision of improved extension services, seasonal and mediun-term credit, market facilities, staff housing, offices, workshops; construc- tion of about 108 miles of feeder roads and improvement of about 82 miles of main und'secondary roads; conversion of the railroad bridge over the Shire river to rail/road use; drilling 140 boreholes for rural water supply; conversion and construction of 4 primary health centers, 11 sub-centers, 16 health posts and improvement of the service center at one hospital; research and technical assistance. PROCUREMENT: Vehicles, machinery, equipment, fertilizers and railway bridge work to be procured by international competitive bidding with farm inputs to be handled by ADM.ARC. Small, scattered housing and building construc- tion, drifts and culverts construction to be handled by local firms. Administration and maintenance equipment (desks, typewriters, etc.) to be procured by local competitive bidding. CONSULTANTS: Consultants for detailed road engineering, bridges and structures to be selected. ESTIMATED COMPLETION DATE: 1978. • - 0 -