Announcement of Land Settlement Project in the Philippines on May 19, 1977

.world Bank 1818 H Street, N. W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 BANK NEWS RELEASE NO. 77/106 LAND SETTLEMENT PROJECT IN THE PHILIPPINES A World Bank loan of $15 million will support a rural development project in the Philippines which will assist the Government in making the best use of remaining public land suitable for settlement by small farmers. This is the first Bank-financed project in the Philippines designed to support the Government's land settlement program and the first to focus on i~1creasing agricultural productivity in rainfed areas. The project provides program support for the Department of Agrarian Reform (DAR), in order to strengthen DAR's coordinating role and its specialist services in planning, land allocation and settlement design. This program support will also directly involve line agencies in developing agricultural services and infrastructure. Under the project, three existing settlement areas in Agusan del Sur • and Bukidnon on Mindanao Island, and Capiz in the Visayas have been selected for development. This pilot undertaking will demonstrate the improvements which can be brought about in the design and implementation of DAR's settlement program. The transportation system in and leading to the settlement areas will be improved, and health and village water supply facilities will be provided. Credit is to be provided through a rural bank in each settlement area. Marketing facilities will also be strengthenedc At the settlement level, the project aims to raise farm incomes and living standards. Per capita incomes, including non-farm income, on typical size farms are expected to increase from about $40 to $160 at full development in Agusan, from $60 to $105 in Bukidnon, and from $60 to $150 in Capiz. The project is estimated to benefit directly some 15,000 poor farmers who, with their families, comprise about 90,000 people. The project will increase average yields and expand the area of cultivation of crops that can offer higher returns to the farmer. At full development, annual incremental rice production will be 37,000 tons; corn production, 26,000 tons; sugar, 15,000 tons; and abaca fiber, 4,400 tons. The $15 million loan is being made to the Republic of the Philippines for a term of 20 years, including 4~ years of grace, at 8.2% interest per year. The Government will relend $900,000 of the proceeds of the loan to the Central Bank of the Philippines on the same terms as the Bank loan for term credit . • Note: Money figures are expressed in U.S. dollar equivalents. FORM NO. 1121 (5-76) T ECHN I CAL D A T A PROJECT: COUNTRY: TOTAL COST: Second Rural Development (Land Settlement) Philippines $32.6 million • BANK FINANCING: $1 5. 0 mi l l ion OTHER FINANCING: Government of the Philippines: $17.3 million Rural Banks and subborrowers: $300,000 IMPLEMENTING ORGANIZATION: Department of Agrarian Reform (DAR), Quezon City, Philippines, will be responsib1e for settlement planning, land allocation, settler registration activities, construction of all buildings and facilities, erosion control works and forestry, minor irrigation systems and village water supplies. For all other activities, the appropriate line agency will be directly respon- sible for execution under the coordinating authority of DAR. PROJECT DESCRIPTION: The project's program support component will strengthen both DAR's coordinating role and its specialist services in planning, land a1iocation and settlement design, as well as directly involve line agencies in developing agricultural services and infrastructure. Settlement development • under the project includes (1) construction, rehabilitation or upgrading of national and provincial roads, village and feeder roads, and in one settlement area low-grade tracks to improve transport of sugarcane, (2) construction, upgrading or rehabilitation of irrigation and drainage works, (3) erosion control, (l~) forest development, (5) construction of health units and village water supply systems. PROCUREMEtlT: Equipment and vehicles for force account construction, and operation and maintenance costing more than $20,000 will be bulked and procured through international competitive bidding. A preference limited to 15% of the C. I .F. price of imported goods, or the customs duty, whichever is lower, will be extended to qualified local manufacturers. Items not ~uitable for international competitive bidding and costing less than $20,000 but more than $10,000 will be procured on the basis of competitive bidding advertised locally. Items costing less than $10,000 will be procured through the Government's normal procurement procedures, up to an aggregate limit of $300,000. Civil works for roads, irrigation and drainage systems, building, forestry and conservation works will be awarded on the basis of local competitive bidding, since these works would not be of sufficient size and could not be bulked to attract inter- national bidders. CONSULTANTS: Consultants will be employed by DAR (1) not later than November 30, 1977 to assist with the,development of a monitoring and evaluation system for the project, and (2) not later than May 31, 1978 to assist with the preparation of a 10-year program for settlement development, and for feasibility studies and detailed s~ttlement programs for new and existing settlement areas. ECONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: 28% July 1982 - 0 - •