Somalia - Second Education Project

CIRCULATING COnPY FILE COPY IQ BE RETURNED TO REPORTS DESK DOCUMENT OF INTERNATIONAL DEVELOPMENT ASSOCIATION Not For Public Use Repor No. P-1444-SO REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDIT TO THE SOMALI DEMOCRATIC REPUBLIC FOR A SECOND EDUCATION PROJECT July 25, 1974 This report was prepared for official use only by the Bank Group. It may not be published, quoted or cited without Bank Group authorization.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.  EXCHANGE RATE US$1 = So. Sh. 6.233 So. Sh. 1 = us$o.1604 SOMALI FISCAL YEAR January 1 - December 31  INTERNATIONAL DEVETOPMEN-T ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDIT TO THE SOMALI DEMOCRATIC REPUBLIC FOR A SECOND EDUCATION PROJECT 1. I submit the following report and recommendation on a proposed development credit to the Somali Democratic Republic for the equivalent of $8 million on standard 3A terms to help finance a Second Education Project. PART I - THE ECONOfY 2. A report entitled "?Recent Economic Developments in Somalia" (Report No. AE-28a) was distributed to the Executive Directors on August 28, 1972. Country Data Sheets are attached as Annex I. A Bank economic mission is scheduled to visit Somalia in October/November 1974. 3. Somalia comprises the mountainous .:idge that forms the Horn of Africa and the coastal plain that lies southi!ast of the Ethiopian highlands. The Somali Democratic Republic was born as an independent nation in 1960 through a merger of uhe former Italian Trust Territory of Somalia and the former British Protectorate of Somalia. In October 1969, the Governnent of Somalia was taken over by the military in a bloodless coup. Since then, the Supreme Revolutionary Council consisting of army and police officers has been the highest decision-making body in the country. Recent Economic Perfor.mance 4. With an e8timated per capita income in the order of $70, Somalia is classified by the UNf as one of the 25 least developed countries of the werld. The economy is simple and largely undeveloped and there are few natural resources which can be easily axploit.ed at present. Most of the people depend upon livestock and subsistence crops for their livelihood. Living conditions for the bnrgely nomadic population are generally harsh. Much of the country is arid, water supplies are scattered and often unreliable and periodic droughts bring great hardship to both people and their livestock. The small monetary sector of the economy provides only limited opportunities for employment. Apart from the traditional export of livestock, commercial agriculture is mainly centered around the production of bananas for export, principally by Italian concession holders, and the production of sugar for the domestic market. Manufacturing and other sectors of the economy are restricted in their potential by the small size of the market, poor infrastructure and the shortage of capital and entrepreneurial experience. Social services are still very inadequate; only a small minority of children go to school and most rural communities are virtually isolated from the rest of the country by poor roads and communications.  - 2 - 5. The first decade after independence was characterized by chronic financial difficulties which were manifested in a complete reliance on external assistance to balance the country's recurrent budget as well as to finance all development expendii;ures. This assistance was, however, less effective than it. might have been because of the limited administrative capacity to evaluate, prepare and implement sound projects. 6. The 1evolutionary Government which came to power in October 1969 is comiritted to the goal of economic development. It places a premium on self-rEliance, which is evident in its management of public finance. The recurrent budgetary position showed considerable improvement starting in 1970 arnd a small surplus was recorded in 1971 and 1972, compared to deficits in earlier years. This achievement was due mainly to effective control of expenditure, improved tax collection and cuts in salaries and wages of govern- ment employees. Expenditures on defense still account for about one-fourth of totel recurrent expenditure, but their rate of increase was reduced to abcut 7 percent between 1970 and 1972 cumpared with the average annual rate of increase of about 15 percent between 1967 and 1970. Budgetary support from Italy, which Somalia has been receiving since 1961, continues but is nowi used mainly to finance development expenditures. 7. Beca.use of arid climate 87 percent of the coiitrry is unsuitable for cultivation and about 70 percent of the population are nomads engaged in live- stock production. of the remaining 13 percent of the area (8 million ha) only about 600,000 ha is now cultivated, mainly in the higher rainfall areas along the Juba and Shebelli rivers and In the northwest region. Along these two rivers, about 100,00C ha are under irrigation; flood irrigation is used to grow subsistence crops such as maize and sorghum and controlled irrigation, mainly on the Shebelli, to grow such crops as bananas, sugarcane, fruit and oilseeds. 8. Livestock, anima.l products aid bananas axaC'ounted For over 90 percent of total exports during the last five years. TJivc- anzmals -are mainly exported to Saudi Arabia, Yemen and Gulf States and processed meat to the USSR. The banana industry is riowi recovering from tne effects of the zlosiure of the Suez Canal in 1967 and the withdrawal of the Dreferentia.1 treatment on the Italian market in 1969. Although Italy st-ll absorbs about 75 perceni: of the exports, new markets in the Middle East should enhance the industry's viability. Sugar- cane, irrigated with water drawn from -!ha Shebelli river, is the most important commercial crop for domestic consumption. Maize, millet and sorghum are the major subsistence crops but their yields are low. Potential 2cists for citrus fruits. rice, cotton and groundnuts. 3ome efforts to er.ploit this potential have been started with external assista ce from the EEC, ti-e U3SR and the People's Republic of Korea. Barring a few exceptisons, f2rming yields little more than subsistence living at present and Somalia still imports substantial amounts of foodgrains. However, -improved expicitation of liveetock, conser- vation of land and water and diversification of agricultu-re, supported by improved farm inputs and techniques, could go far towards developing the potential. 9. Somalia's trade balance has been constant ly in def"icit in recent years, the average deficit over the period 1970-72 being $i6 millicn annually.  According to the balance of payments statist:cs, exports grew at <a-x average annual rate of 7.6 percent in the period 1965-71 and rose by 38 percent in 1972, while imports grew 6.2 percent annually and 20 percent, respectively, during the corresponding periods. From 1968 to 1972 the balanr,e of payments deficit on current account averaged about US$8 million but the overall balance was in surplus due to large capital inflows. WUhile information on 1973 is still incomplete, preliminary figures indica-te a decline in livestock exports coupled with a higher level of imports, resuLting in a deficit on current account of U$26 million; there was a. small deficit in the overall balance for the first time since 1968. The country's official international reserves (gross) at the end of November 1973 amounted to US$33 million, the equivalent of about 5 month's imports. Due mainly to the increased cost of oil imports, it is estimated that the current account deficit will grow to about US$60 million by 1975, thus pointing clearly to the need for a larger inflow of capital. 10. Since independence Somalia has received substantial amounts of foreign aid. From 1965 to 1972 the average annual disbursement of loans and grants was in the order of $24 million, 70 percent of which was in grants to finance development projects as well as deficits in the recurrent budget. The major sources of capital during this period were Italy, the United States, the European Economic Community, the United Nations, the Federal Republic of Germany and the USSR. IDA accounted for about 11 percent of the total dis- bursements of loans in the three-year period from 1970 to 1972. In the last few years the People's Republic of China and Saudi Arabia made substantial loan commitments. 11. At the end of 1972 Somalia's total debt amounted to $232 million equivalent, of which $107 million was disbursed. The USSR accounted for 44 percent of the disbursed debt while the shares of Saudi Arabia, the Federal Republic of Germany, United States and IDA were 13 percent, 12 percent, 11 percent and 10 percent, respectively. The major portion of the Chinese loans are still undisbursed. The debt service ratio in 1972 was 3 percent. However, interest and amortization payments are to increase substantially from 1973 onwards and the debt service ratio will probably rise to over 10 percent during the next three to four years. Somalia will, despite recent improvement in economic performance, continue to need a substantial amount of external aid for development. As much of this aid as possible should be on concessionary terms, and because of the dearth of domestic resources, external financing should be provided for a large part of domestic costs as well as the foreign costs of investments. 12. Somalia is at present exclusively dependent on imported oil as a source of energy except for cooking, for which the majority of the population uses charcoal and firewood. Of the two main rivers of Somalia, the Shebelli and the Juba, the Shebelli lacks sufficient flow for hydroelectric purposes and ends in the dry sand southwest of Mogadiscio. The USSR started construc- tion of a combined irrigation and hydroelectric scheme on the Juba in 1964, but completion is reported to be delayed. As the industrial sector in Somalia is quite small, the demand for power will not increase sharply over the short run. In the long run, however, power may be needed for the exploitation of the deposits of thorium, uranium and other minerals in the country. While we  - 4 - do not -onow the distribution of public and private consumption of gasoline, it is believed that the pu'blic sector is the largest consumer. Consequently, the increase in oil prices will reduce the modest savings the Government is trying to achieve. The increase in the price of gasoline is likely to limit its consumption in the private sector as incomes are very loa. 13. In May 1970 the Government nationalized a number of foreign (mainly Italiar) private enterprises, including an electric poier company, a sugar refinery and commercial banks. Negotiations on the terms of compensation with most of the firms have been completed and the Government intends to pay com- pensation due to other firms or completior of negotiations. Development Planming 14. The period of implementation oV' the Government's most recent three- yea.r Development Program, 1971-73, came to an end in December 1973. The Program had an investment target of So. Sh. 1000 million ($160 million) and gave high priority to transport, communications and agriculture which together claimed about 70 percent of the planned expenditures. The Government, placing a high premium on self-reliance planned to finance 20 percent of the development expenditures from internal sources in contrast to the earlier economic plans (1963-67 and 1971-73) which looked to foreign aid for virtually all of the financing. 15. During the first two years of the Program, development expenditures amounted to only 50 percent of the lanzned levels for each year. The short- fall was mainly attributable to uncertainty of external finance as well as administrative constraints. During the same period, the share of the domestic financing (38 percent) was higher than the target (20 percent) mainly because of the shortfall in investment. 16. The Government has been formulating a new Five-Year Development Plan to start this year. The draft plan continues to give high priority to agri- culture and transportation with increased emphasis on education and the fishery industry. We are discussing with the Government the possibility of a UNDP- financed planning assistance project to strengthen the planning machinery of Somalia. PART !I - BANK GROUP OPERATIONS IN 3Si)ALIA 17. Starting in 1965, IDA has made seven credits totalling about $45 million, about 70 percent of which has been for transportation development, including construction of two trunk roads (Afgoi-Baidoa in the central region and Hargeisa-Berbera irn the northern region) and a new deep-water port at .4ogadiscio. The economic future off the country depernds on the development of agriculture and the livestock export trade. Provision of basic transportation infrastructure is an essential re-recuisite for development and also helps in the important task of nation-building by tying together Samalia's geographic- ally isolated regions. IDA credits also assisted Somalia in ed-ucation in 1971 and livestock in 1974. No Bank loans or IFC -nvestments have been made in Somalia. As mentioned above, ILA credits accounted for. 10 percent of Somalia's  - 5 - outstanding debt at the end of 1972. Debt service pay.ients on ex:sting IDA credits in 1980 are projected at 9 percent of Somalia's total debt service payments on the above debt. 18. Annex II contains a surmary statement of IhA credits as of June 30, 1974 and notes on the execution of ongoing projects. Performance has been generally satisfactory. 19. We plan to concentrate our efforts on the country's most important productive sectors, agriculture and livestock, and also on education and transport. Agriculture offers the greatest potential for development but most rural development activities are only at the beginning stage. Moreover, agricultural development in Somalia is particularly difficult because most of the people in rural areas are nomadic. The first effort was the Trans-Juba Livestock project approved in early 1974. In the second half of the fiscal year we plan to present another agricultural project to assist development in the northern region. In education, as noted above, an IDA credit was made in 1971 and the credit proposed herein would complement the earlier project. 9C. The country's transportation and ccmmunication facilities are inadequate and the 3overnment plans to continue transport development in the next few years. The second highway credit under implementation provides for feasibility studies and detailed ergineering for the improvement of the Hargeisa-Borama road in the northern region, which would further promote livestock and agricultural development in the area. Mhe studies are expected to be completed in the middle af 1975 and to provide the basis for a further project which IDA could support. PART III - EDUCATION IN SOMALIA 21. The education system consists of a h-year elementary course, a 4-year intermediate course, a h-year general secondary school course or a 2-h-year technical/vocational course following the intermediate level, and a 4-year university course. Since 1972, promotion between the first two cycles has been automatic and the two cycles are being merged into an 8-year primary course. 22. The weak state ofthe Somali education and training sector is re- flected in the low literacy rate of 5 percent. The system has suffered from lack of a Somali script, regional differences in the education systems inhe- rited from the two colonial administrations, a high rate of nomadism and a shortage of financial resources. In the 1972 school year, enrolments were 16 percent of the relevant age group at the elementary school level, 9 percent at the intermediate level and under 4 percent at the secondary level. These low enrolment ratios indicate the need for expansion of enrolments at all levels. Eighty-three percent of secondary school students are concentrated around the two main cities, Mogadiscio and Hargeisa. Educational opportunities in rural areas are negligible, particularly for nomads who account for about two-thirds of the country's population and are engaged in the mainstay of the country's economy, livestock raising. In order to fully apply modern school curricula, which emphasize practical and science subjects, school buildings, furniture and e(ouipment require improvement. There is an acute shortage of teachers, and a large percentage of them are not adequately qualified.  - 6 - 23. In the last few years, the Govermment has given greater emphasis to education withi a major effort being directed towards increasing literacy. As a result, enrolments in primary and general secondary schools have increased substantially. The adoption by the Government in 1971 of the Somali language with Latin script as the teaching medium to replace the diverse use of Arabic, English and Italian has facilitated this expansion. Adult education is also being given considerable attention by the Gove.rnment. The programs include an extensive adult education scheme and establishment of farmer training centers and wamen's education centers. In 1973 about one-third of adults in urban and settled areas attended literacy classes and short-term courses. But even these succes3ful programs have only a limited impact on a majority of Somalis, parti- cularly on nomads. 24. The draft Five-Year Development Plan, 1974-78, gives equal priority to the growth of elementary education and to the strengthening of non-formal education. Most notably, enrolments in grade one are planned to increase by 1C percent p.a. and consequently the enrolment ratio of elementary schools (grades 1-4) would increase from 16 percent in 1972 to 50 percent in 1983. Given an increased supply of teachers and the use of the national language as an instruction medium, the planned increases appear feasible. 25. Somalia has five technical institutes at the post-intermediate level, of which two are being improved and expanded under the first IDA Education Project, and one was built with assistance from the Federal Republic of Germany. There are also six specialized vocational training institutes. The country lacks facilities for post-secondary technician training, but the Peoplets Republic of Korea is considering financing a new Polytechnic. 26. From 1968 to 1972 the country had no facilities for the pre-service training of primary teachers. As a result, there is now an acute shortage of primary school teachers and the situation has been aggravated by construction of primary schools under self-help schemes. This shortage is expected to be eased by the expansion of the National Teacher Education Center which is being assisted by IlD and UNDP/UNESCO and by the establishment of a Teacher Training College under the proposed Project. (Please see also paragraph 35.) 27. The Somali National University, for which the Italian Government has provided financial and technical assistance for many years, has nine faculties ,and 14O0 students and expansion is being planned. 28. All private schools were nationalized in 197P. Students at all levels pay no tuition fees but boarders contribute part of the cost. Si.nce independence, the recurrent budget for education has been abcut 7 percent of the Central Government recurrent budget. The ratio is substantially lower than in neighboring countries mainly because of low enrolments and the large number of expatriate teachers provided and financed under bilateral assistance programs. For example in the 1971 school year about 60 percent of secondary school teachers were expatriates.  -7- PART IV - THE PROJECT Background 29. The proposed project will be the second one financed by Iat1 for education in Somalia. The first Education Credit (1971) of $3.3 million is financing: (a) extension of the National Teacher Education Center providing primary and secondary teacher training; (b) construction of one new secondary school; (c) extensions of ten secondary schools; (d) extensions of one technical school and one technical/commercial school; (e) provision of eight mobile training units for agricultural education; and (f) technical assistance. 30. Although implementation is about six months behind schedule due to changes in Project Unit staff, revision of the project as requested by the Government and late recruitment of technical specialists, the perform- ance has improved considerably since late 1972 and most of the lost time will probably be regained. 31 . Taking into account a UNESCO Project Identification mission report of April 1973, a Bank mission held discussions with the Government in September 1973 which were followed by a Bank Preparation/Appraisal mission in November/I)ecember 1973. Negotiations took place in Washington in June 1974 with the Somali delegation headed by H. E. Abdirazak Haji Hussein, the Ambassador to the United Nations Organization. 32. A report entitled "Appraisal of a Second Education Project in Somali Democratic Republic" (No. 438a-SO, dated June 28, 1974) is being circulated to the Executive Directors separately and a Credit and Project Summary is attached as Annex III to this Report. Desc ription 33. The proposed project is part of the Borrower's education development program and consists of the following components (map attached): (a) Academy of Somali Studies - The expansion and rebuilding of the Academy of Somali Studies, these facilities to include staff offices, a language laboratory, library and audio- visual workroom. (b) Elementary Teacher Training - Construction of an 800-student capacity elementary teacher training college in Hargeisa, these facilities to include student hostels, staff housing and communal services.  (c) Secondar,r Schools - Provision of additional buildings, furniture and equipment for pre-vocational, agricultural, handcrafts and domestic science training in selected 10 existing general secondary schools and the rebuilding of the Fishery and iMarine Institute where student hostels and a staff house will be ikmluded. (d) Nomad Training - Construction of 10 Nomad Training Centers, these facilities to include student hostels, staff housing and the required comiunal services. (e) Technical Assistance - (i) Techrical assistance to provide for the staffing of the management of the Project through the Project and School Design Units; and (ii) Technical assistance to provide! for the staffing of the Fishery and Marine Institute. 34. The Academy of Somali Studies. The primary responsibilities of the Academy, which was established in 1973, are: (a) development of the Somali language using Latin script on a scientific basis; (b) production of literature for mass readership with emphasis on functional literacy; (c) publication of educational materials for study at academic institutions and general readership; and (d) applied research in language, culture and science. At present, the Academy operates from make-shift quarters in an old dwelling on the outskirts of Mogadiscio. 35. Elementary Teacher Training College. To alleviate the existing shortage and oualitative shortcommings of elementary school teachers and to meet a planned 10 percent per annum increase of enrolments into grade one of elementary schools, the new college will enrol 800 students in 2-year courses. Particular emphasis will be given to practical subjects, such as agriculture and home economics. The National Teacher Education Center which is being expanded under the first IDA Education Project and is receiving UNDP/UNESCO technical assistance will supply teachers for this College. 36. Secondary Schools. The Project will continue the efforts of the first education project to shift the emphasis of general secondary schools from academic to scientific and practical subjects. The student-places in the 10 schools assisted by the Project will be increased from 2,700 to about 3,800. As the ongoing project is providing similar assistance to 11 other general secondary schools, the two IDA projects in Somalia will together improve 21 out of 26 existing general secondary schools. An adequate supply of suitably trained teachers will be available from the National Teacher Education Center. 37. Output from the 26 general secondary schools is not likely to exceed the demand for graduates in the foreseeable future. During the 1972-83 school years, about 22,000 students will graduate from the country's secondary schools compared with an estimated need of about 29,000 for employment in the modern sector. Further expansion of the schools to meet the estimated shortfall of 7,000 graduate should prudently be deferred until the late 1970's when the rate of assimilation of graduates into jobs becomes more certain. An informal under- standing was reached with the Government that it would exchange views with the Assocciation on the long-term targets of the country's education development.  - 9 - 38. The Fishery and Marine Institute. The country's only fishery train- ing institute will offer 4-year courses for 300 students in grades 9-12. Somalia is endowed with a 3000 kmo coastline with good potential for fishery development. The Government believes that emphasis on fishery development is lovig overdue and the draft 5-year development plan places a strong emphasis on its development including the proposed rehabilitation and expansion of the Fishery and Marine Institute. Somalia is also receiving technical assistance from the UNDP and the USSR in developing other aspects of the fishing industry. The fishing industry is expected to expand and to provide ample opportunities for employment of the Institute's graduates. 39. Ten Nomad Training Centers. On an experimental basis,, the Project will start the important task of providing educational and training facilities for nomads. Of the proposed ten Centers, five will be sited in purely nomadic areas and five in partially settled areas. Each center will enrol 160 boarding students. Children (age 7-16) will be given a 4-year course, and in each center an estimated 200 adults per annum will also attend short courses in practical subjects, such as hygiene, agricuilture and animal husbandry. The proposed centers with combined capacity of 1600 children and 2000 adults per annum will be the country's only facilities for education and training of nomads. 4o. Technical Assistance. The Project will provide 16 man-years of technical assistance for the Fishery and Marine Institute and for the Project and zchools Construction Units to implement the Project. Project Cost and Financing Plan 41. The total cost is estimated at the equivalent of $10.1 million including taxes and $9.3 million excluding taxes. The foreign exchange component is estimated at $6.1 -million, or 60 percent of the total project cost and 66 percent of the net o, tax cost. The proposed $8 million credit will cover abouu 86 percent of the net of tax cost. The recurrent expendi- tures generated by the Project -w-ill be about So. Sh. 9 million (about $1.5 million) per annum, 10 perment of the estimated total recurrent expenditures on education for 1978, Thiis proportion is not excessive, as the Project will involve a large part of the country's education system. Implementation 42. The Project will be executed over a period of six years. The Project Unit for the ongoing IlI project under the Mi'Lnistry of Education will have overall responsibility for Project execution and the Schools Construction Unit, also established under the ongoing Project, will contine to be responsible for design and supervision of construction. The Project and Schools Construction Units are functioning efficiently and will carry out the proposed Project with some additional specialist staff such as a quantity surveyor, a procurement adviser and an accountant.  Proc-urement 43. Contracts for civil works, furnitulre and instructional equipment will be awarded on the basis of international competitive bidding. Because of their small size (an estimated average of' under $100,000) and scattered locations, contracts for civil works for the ten general secondary schools amounting to about $1 million will be awarded following competitive bidding after advertising only in Somalia. Procurement of furniture costing less than $30,000 up to an aggregate total of $100,000 will be on the basis of local -ompetitive bidding in accordance with contracting procedures accept- able to the Association. Domestic civil works contractors will be allowed a preferential margin of 7-1/2 percent over the bid prices of' competing foreign firms. Domestic manufacturers of furniture will be allowed a 15 percent preference margin or the existing rate of import duties, which- ever is lower, over the c.i.f. bid prices of competing foreign firms. Disbursement t,4. Disbursement will be against (a) 100 percent of foreign expendi- tures for imported equipment and furniture; (b) 95 percent of ex-factory cost for locally manufactured furniture; (c) 80 percent of local transportation costs for furniture and equipment; (d) 74 percent of expenditures for civil works; and (e) 100 percent of foreign expenditures and 90 percent of local expenditures for technical assistance and project administration. Disburse- ment is expected to be completed by June 30, 1980. Benefits and Risks h5. The proposed project is designed to assist in the achievement of educational objectives consistent with the country's socio-economic needs, namely: (?) to help develop the written national language as a means of reducing illiteracy and increasing the efficiency of the education system; (b) to expand the enrolment of the formal school system to meet future man- power requirements; (c) to further reorient instruction towards practical purposes; and (d) to provide education and training programs to assist rural development, particularly to educate nomads in practical subjects such as animal husbandry. Among other things, the first and proposed second projects together will cover all planned expansion of elementary teacher training and the improvement of general secondary schools with 85 percent of the country's total enrolment and of technical schools with 60 percent of the total enrol- ment, as well as mobile agricultural training and nomad education. The benefits of the Academy of Somali Studies and Nomad Training Centers are far-reaching. Development of the national script will facilitate written cormmunication in all social and economic activities of the Somali people as well as of private and public agencies, help reduce illiteracy by short- ening the period needed to achieve satisfactory educational standards and help unify the Somali people. The Nomad Training Centers will contribute to the development of the country's most imp,ortant productive sectors -- livestock and agriculture -- and help mobilize scattered nomads for nation building.  - 11 - 46. This is the Bank Group's first education project designed to support develDpment of a national language and a training scheme for nomads and, as with all new ventures, there is some risk that all the objec cives may not be achieved. We intend to keep a close watch on these activities with a view to reducing the risks to a mirimum. Considering the benefits which will result if these efforts are successful, we believe the risks are well worth taking. Regarding the Academy of Somali Stulies, the work program for the first five years has been discussed in detail with the Government and agree- ments made on a continuing dialogue on this rqatter and the submission of the Academy's annual reports to the Association (Section 3.04 of the draft Credit Agreement). With respect to the Nomad Training Center, an interministerial Nomad Education Board will be established. It was agreed that this Board would regularly monitor and evaluate the Centers' activities and effectivenss, and maintain close liaison with the Association (Section 3.05 of the draft Credit Agreement). The success of the Noma6 Training Centers will depend on their location and on careful selection o' students, teachers and courses. Special care will be needed in selecting the Centers' locations in harmony with other rural development activities. For example, it was informally agreed with the Government that four centers would be located in the project area of the ID[-financed Trans-J.uba Livestock Development Project. Employment aspirations of the students would be carefully monitored before their enrolment so that a majority of graduates of the four-year courses would continue their rural activities without nigrating to urban areas. Teachers would be selected with a view to their familiarity with a nomadic environment and credibility with nomads, and receive one year training at a Farmer Trainin;g Center. The centers would adopt the courses best suited to nomads' needs, such as in animal husbandry and agrcnomy. It was agreed that details of the teacher training courses as well as centers' courses would be sent to the Association for its comnents (Section 3.03 of the draft Credit Agreement). PART V - LEGAL INSTRUNENT AND AUTHORITY 47. The draft Development Credit Agreement between the Somali Democratic Republic and the Association, the Recommendation of the Committee provided for under Article V, Section I(d) of the Articles of Agreement of the Association, and the text of a draft Resolution approving the proposed Development Credit are being distributed to the Ececutive Directors separately. These draft agreements conform substantially to the Association's pattern for education projects. 48 . I am satistied that the proposed credit will conply with the Articles of Agreement of the Association. PART VI - RECOMMENDATION 49. I recommend that the Executive Directors approve the proposed Development Credit. Robert S. McNamara Attachments President Washin ton D.C. JulyT, 1T74   ANNEX I Page 1 of 3 pages ODWUINR DAU - SONALIA AREA POPSLATIcS L NSITY 63,t6 N2 . T r'iilieo (reid-1971) Per helof ojable land SOCIAL -IDICATORS Reference Coontries Sozalia Ehia ___ Te.nsa; a C UP PER CAPI?A USt (ATLAS B SIS) A 70 /b 80 , 160 / 110 L/.c -rde birt;h rate (par thousand) .. b6 146 V 48 5 47 Crde death rat. (per thousand) - 24 25 18 22 c Irf.nt mortality rtse (per thoueeand live birthe) .. .. .. 5$ 160-165 ^ Life expectancy at birth (yeara) .. 40 39 48 0 43 .ross rreprooctioo r-t. /2 .. 3.0 2.9 3.b 3.2 Poputton groto rote 2.0 2.41 i 2.1 3.1 3