Announcement of Six Million Dollars IDA Credit for Coffee Production in Zambia on December 18, 1978

I I FOR IMMEDIATE RELEASE •world Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 IDA NEWS RELEASE NO. 79/28 December 18, 1978 $6 MILLION IDA CREDIT FOR COFFEE PRODUCTION IN ZAMBIA Zambia's efforts to diversify its economy away from its dependence on copper will be assisted by a $6 million IDA credit. The credit will finance a coffee project that will lead to an increase in coffee production in Zambia by about 800 tons per annum. The project consists of the development and rehabilitation of two commercial coffee estates, the establishment of coffee processing, roasting, and packing facilities; the development of smallholder coffee production in the Northern and Northwestern Provinces of the country, and the strengthening of the national coffee research institutions. The coffee estates at Ngoli and Kateshi will be provided, among other things, with farm and processing machinery, equipment, vehicles, irrigation system, technical assistance, and staff training. The real incomes of some 600 small- holder families in the Northern Province will be increased by providing them • with equipment and machinery, extension services, and training. Similar increase in the incomes of smallholder families in the Northwestern Province is also expected. The project will also provide annual employment for about 960 persons. By reducing coffee imports, Zambia is·expected to save about $2.2 million in foreign exchange annually. The project will also contribute to increased food production in the country by financing the planting of 450 hectares of maize on the two commercial estates. This is expected to produce about 2,000 tons of maize annually. The $6 million IDA credit will finance 72% of the total project costs estimated at $8.3 million. The remainder of the cost will be provided by the Government of Zambia and through project generated funds. The IDA credit is on standard terms of 50 years; including 10 years of grace, with no interest. It carries a service charge at 3/4 of 1% per annum to cover administrative costs. NOTE: Money figures are expressed in U.S. dollar equivalents . • FORM NO. 1121 (5-76) T E CHN I CAL DA T A PROJECT: COUNTRY: TOTAL COST: Coffee Production Republic of Zambia $8 . 3 mi 1 1 i on • IDA FINANCING: $6 million, standard IOA terms .. OTHER FINANCING: Government of Zambia, $1.60 million Project Generated Funds, $0.70 million IMPLEMENTING ORGANIZATIONS: Rucom Industries, Ltd. Longolongo Road P. 0. Sox 800 Cable: RUCOMIN, Lusaka Lusaka, Zambia Zambia Ministry of Lands and Agriculture Lusaka, Zambia • PROJECT DESCRIPTION: The Coffee Production Project will develop and rehabilitate two corrmercial coffee estates and develop smallholder coffee production. The project will also provide for coffee processing, roasting, and packing facilities. Maize will be produced on the two coffee estates to provide mulch for coffee. The research capabilities of the national coffee research institution~ will be strengthened through provision of technical assistance, training, and equipment. PROCUREMENT: Procurement will be in accordance with Bank guidelines, with orders for agricultural machinery, vehicles, and equipment oeang bulked as far as practicable and procured through local competitive bidding. Processing machinery will be procured through international competitive bidding. The other components will be under local competitive bi·dding since the contracts will be too small to attract international bids, although foreign firms will be allowed to compete; procurement for research and smallholder coffee develop- ment components will follow the-government's standard procurement regulations and procedures. • ECONOMIC RATE OF RETURN: 21% ESTIMATED COMPLETION DATE: 1984 - 0 -