Argentina - Agricultural Credit Project

Document of FIL E: y The World Bank FOR OFFICIAL USE ONLY Report No. P-2304-AR REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE ARGENTINE REPUBLIC FOR AN AGRICULTURAL CREDIT PROJECT April 26, 1978 This document has a restricted distribution and may be used by recipients only In the performance of their official duties. Its contents may not otherwise be disclosed withaut World Bank authorization.  CURRENCY EQUIVALENT June 1977 1/ April 1978 Currency Unit = Argentine Peso ($a) US$1 = $a 380 $a 730 USI million = $a 380 million $a 730 million $a million = US$ 2,632.00 US$ 1,370 WEIGHTS AND MEASURES Metric System GLOSSARY OF ABBREVIATIONS BNA - Banco de la Naci6n Argentina - State Bank of Argentina INTA = Instituto Nacional de Tecnologfa Agropecuaria - National Institute of Agricultural Technology PBS - Bancos Participantes - Participating Banks SEAG = Secretarfa de Estado de Agricultura y Gana- derla - State Secretariat for Agriculture and Livestock BANADE = Banco Nacional de Desarrollo - National Development Bank FISCAL YEAR January 1 to December 31 1/ June 1977 exchange rate used at the time of the appraisal.  FOR OFFICIAL USE ONLY ARGENTINA AGRICULTURAL CREDIT PROJECT Loan and Project Summary Borrower: Government of Argentina Beneficiaries: Government would on-lend the Bank's loan proceeds to Banco de la Nacion Argentina (BNA) and provincial banks which, in turn, would make subloans to some 4,500 farmers and cooperatives. Loan Amount: US$60.0 million equivalent. Loan Terms: Tlhirteen years including four years of grace, at 7.5% per annum. Relending Terms: Government to BNA and other participating banks at 2.75%, PBs to beneficiaries at 6% in $a adjusted by the official general wholesale price index. Repayment tierms from three to nine years, including up to four y,ears of grace. Project Description: The project would form an important part of the Government's agricultural development strategy. It would help strengthen Argentina's export capacity and thus make it more independent from the stringent balance of payments constraints that have been a major factor of Argentina's erratic growth pattern in the past. Medium-and long-term agricultural credit and technical assistance financed under the project aim at increasing the relatively low productivity of farms in the Pampas and Mesopotamic region of the country, restoring the productive capacity of soils in an extensive area infested by weeds, and at expanding the country's cropping and pasture areas by clearing large portions of unproduc- tive wooded land in the northern provinces. The project would have no special risks other than changes in Government pricing and exchange rate policies. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its conterits may not otherwise be disclosed without World Bank authorization.  - ii - Estimated Project Cost: Investment Category Local Foreign Total ------ (US$ Million) ---- On-farm Development 28.2 7.8 36.0 Weed Control 28.0 12.0 40.0 Land Clearing 25.5 28.0 53.5 Technical Assistance 0.8 0.7 1.5 Price Contingency 19.2 11.5 30.7 Total: 101.7 60.0 161.7 Financing Plan: Sub-borrowers Participating Banks Bank Total Amount X Amount X Amount % Amount % (US$ M) (US$ M) (US$ M) (US$ M) 31.6 20 70.1 43 60.0 37 161.7 100 Estimated Disbursement: Bank FY 1979 1980 1981 1982 1983