Announcement of World Bank Lends Twenty-One Million Dollars for Irrigation in Philippines on December 14, 1978

FOR IMMEDIATE RELEASE . •World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 79/31 DECEMBER 14, 1978 WORLD BANK LENDS $21 MILLION FOR IRRIGATION IN PHILIPPINES The World.Bank announced today the approval of a $21, Ilion loan to help finance part of the second stage of the Magat River irrigation project. The project will increase food production and help the development of the depressed Cagayan Valley, benefitting about 77,000 people. The project will increase yields and cropping intensities on about 26,770 hectares of land, by providing an assured year-round water supply, improved infrastructure, and better supporting services .• It will increase annual rice production by about 152,000 tons • • The project, with an estimated total cost of $62 million, will be the final step in a series of projects assisted by the World Bank and the Asian Development Bank aimed at developing the irrigation potential of the valley. Approximately 8,000 farm families and 4,400 landless laborers' families, most of whom have earnings below the poverty line, will benefit directly. The project will also create a demand for additional farm labor equivalent to 8,400 full-time jobs per year. The project consists of construction of the Baligatan storage dam and additional irrigation and road facilities, provision of consulting service, and procurement of vehicles and equipment for operation and maintenance of the facilities. The $21 million loan to the Republic of Philippines will have a term of 20 years, including 5 years of grace, with interest at 7.35% per annum. The International Fund for Agricultural Development (IFAD) is expected to provide a $10 million loan to co-finance the project~ • NOTE: Money figures are expressed in U.S. dollar equivalents • FORM NO. 1121 (5-76) T EC HN I CAL D A T A PROJECT: COUNTRY: TOTAL COST: Magat River Multipurpose: Philippines $62 mi 11 i Oil Stage I I Irrigation • BANK FINANCING: $21 mill ion for a term of 20 years, including 5 years of grace, with interest at 7-35% per annum OTHER FINANCING: International Fund for Agricultural Development, $10 mill ion; Government of Philippines, $31 million. IMPLEMENTING ORGANIZATION: National Irrigation Administration (NIA), Manila, Philippines. CABLE: NIAPHIL; TELEX: 7422076. PROJECT DESCRIPTION: It consists of: a) construction of the Bal igatan diversion dam; b) construction of irrigation and drainage facilities and roads on a total area of about 26,770 ha. of currently rainfed land; c) construction of three pumping stations to serve lands at higher elevations covering 8,000 ha. of the project area; d) supply and installation of pumps, motors, auxiliary equipment and pipel i . ; e) provision of consulting services to assist NIA in designing the pumping stations, and in procurement:, installation and testing of pumping equipment; and f) procurement of vehicles and equipment for project implementation, operation, and maintenance. PROCUREMENT: Pumping station equipment, and equipment for project implementation, operation and maintenance (about $6.7 million) will be procured after international competitive bidding (ICB) in accordance with Bank guidelines. A preference 1imited to 15% of the c. i.f. price of imported goods or the custom duty, whichever is lower, will be extended to local manufacturers in the evaluation of bids. Off-the-shelf items costing less than $10,000 each and for a total not exceeding $200,000 will be procured through normal government procedures acceptable to the Bank. Construction of the Baligatan diversion dam, together with intake structures, main canal with major laterals and service roads of the South High Canal Area, will be let as one contract and awarded following ICB in accordance with Bank guidelines. Most of the remaining civil works, scattered over four separate locations and split into about 20 contracts, will be carried out on the basis of competitive bidding in accordance with local procedures. The rest, not exceeding 40% of the total cost of civil works, wiil be carried out by force account. CONSULTANTS: About 20 man-months of consulting services to assist NIA in planning and design of the three pumping stations, the preparation of specifications for the procurement of equipment, the evaluation of bids, and • the supervision of the installation and testing of the equipment, will be required . ECONOMIC RATE OF RETURN: 13% ESTIMATED COMPLETION DATE: 1982 - 0 -