Guinea - Second Highway Project

Document of The World Bank F'LE COPY FOR OFFICIAL USE ONLY Report No. P-2514a-GUI REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDIT AND AN EEC SPECIAL ACTION CREDIT TO THE REVOLUTIONARY PEOPLE'S REPUBLIC OF GUINEA FOR A SECOND HIGHWAY PROJECT August 28, 1979 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 without World Bank authorization. CURRENCY EQUIVALENTS Currency Unit = Syli US$1.00 = 20 Sylis Syli 1.00 = US$0.05 Syli 1 million = US$50,000 HKASURES I m 2 3.28 ft. 1 m = 10.76 sq. ft 1 km2 0.62 mile 1 km 0.38 sq. mile ABBREVIATIONS ADB African Development Bank BADEA Arab Bank for Economic Development in Africa CCMECON Council for Mutual Economic Assistance COTRA Road Transport Company DCA Development Credit Agreement DGRB Directorate General of Roads and Bridges FED European Development Fund EEC European Economic Community MEF Ministry of Economy and Finance MOT Ministry of Transport MPC Ministry of Planning and Cooperation MPW Ministry of Public Works OECD Organization for Economic Cooperation and Development ONRR Office National Rail-Route OPEC Organization of Petroleum Exporting Countries FISCAL YEAR January 1 - December 31 FOR OFFICIAL USE ONLY THE REVOLUTIONARY PEOPLE'S REPUBLIC OF GUINEA SECOND HIGHWAY PROJECT CREDIT AND PROJECT SUMMARY Borrower: Revolutionary People's Republic of Guinea Amount: US$13.0 million (IDA) US$4.0 million (EEC Special Action Credit) Terms: Standard Co-lender: BADEA - US$6.0 million; terms - 16 years including 4 years grace at 4 percent interest Project The project constitutes the second phase of a long-term Description: program begun in 1976 with IDA's help to provide an adequate and properly maintained road infrastructure to support Guinea's economic development. It consists of (i) a three-year phase of road rehabilitation (1500 km) and maintenance (4600 km), including purchase of highway and workshop equipment, spare parts, fuel, materials and supplies, fellowships and 243 man-months of technical assistance to the Ministry of Public Works (MPW) for project implementation and training; (ii) renovation of the existing National Public Works (Soils) Laboratory and its equipment and 36 man-months of technical assistance for training its staff; and (iii) consultant services for preparing a feasibility study and detailed engineering for reconstruction of sections of the Conakry-Mamou road, and training of MPW staff to be the nucleus of a new Studies and Programming Division. About seventy percent of direct project benefits from vehicle operating cost savings would accrue to the state-owned transport organizations and the Government; private drivers and operators generally engaged in passenger transport would receive the remainder. By improving mobility and the transport of goods and people, the project will also benefit the Guinean economy as a whole. The project builds on the experience acquired under the First Highway Project and presents no special technical risks. Included in it are measures to help the Government overcome past difficulties in management and in mobilizing adequate financial resources for road maintenance. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Estimated Cost: Foreign ------ (US$'000) ------ as Z Foreign Local Total of Total Category of Expenditure A. Road Rehabilitation and Maintenance 19,562 6,882 26,444 74 Equipment and Spare Parts 8,811 0 8,811 100 Operating costs for road rehabilitation 5,977 3,492 9,469 63 Incremental recurrent costs for road maintenance 1,527 3,068 4,595 33 Construction of Offices and Workshops 304 202 506 60 Technical Assistance and Fellowships 2,943 120 3,063 96 B. Improvements to Soils Laboratory 904 89 993 91 Building Extension 110 74 184 60 Equipment, Materials, and Supplies 387 0 387 100 Technical Assistance and Fellowships 407 15 422 96 C. Preinvestment Studies of Conakry-Mamou Road 1,166 130 1,296 90 TOTAL PROJECT COST (net of tax) 21,632 7,101 28,732 75 (21,600) (7,100) (28,700) (75) Of which: Base Cost 18,726 6,480 25,206 74 Physical Contingencies 639 249 888 72 Price Contingencies 2,267 372 2,639 86 Taxes on Fuel and Lubricants 1/ 0 3,200 3,200 0 TOTAL PROJECT COST (including tax) 21,600 10,300 31,900 67 1/ The Government has agreed to exempt the project from taxes and duties, apart from those on fuel and lubricants. Taxes estimated at US$3.2 million have therefore been included in the local cost of these items. Rate of Return: 49 percent Financing Plan: (Including Taxes) ----------US$ million----- Foreign Local Taxes Total IDA 11.3 1.7 - 13.0 EEC Special Action Fund 3.8 0.2 - 4.0 BADEA 6.0 - - 6.0 Government 0.5 5.2 3.2 8.9 TOTAL 21.6 7.1 3.2 31.9 Estimated Disbursements: IDA Ff 80 81 82 83 ----------US$ million---------- IDA Annual 3.0 3.8 4.2 2.0 Cumulative 3.0 6.8 11.0 13.0 EEC Annual 3.0 1.0 0 0 Cumulative 3.0 4.0 0 0 Staff Appraisal Report: 2363-GUI, dated August 20, 1979 Map.: IBRD 14076.  INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDIT AND AN EEC SPECIAL ACTION CREDIT TO THE REVOLUTIONARY PEOPLE'S REPUBLIC OF GUINEA FOR A SECOND HIGHWAY PROJECT 1. I submit the following report and recommendation on two proposed credits to the Revolutionary People's Republic of Guinea for the equivalent of US$17.0 million on standard IDA terms to help finance a Second Highway Project. One credit of US$13.0 million would be made from IDA resources. A second credit of about US$4.0 million equivalent would be made from the EEC Special Action Account, administered by the Association in accordance with the terms of the agreement of May 2, 1978 between the Association and the European Economic Community. The Arab Bank for Economic Development in Africa (BADEA) has agreed to provide a loan to Guinea for the equivalent of US$6.0 million to help finance specific project components. This loan would have a term of 16 years including 4 years grace with interest at 4 percent per annum plus a service charge of 0.5 percent. PART I - THE ECONOMY 2. The last economic report (No. Af-63b, dated September 1, 1967) was distributed to the Executive Directors on January 22, 1968. From 1970 to 1977 a number of economic missions visited the country which identified the major structural constraints on the expansion of output and incomes and provided the basis for an increasingly active dialogue on development policy issues. Our last economic mission took place in March 1979, and its findings and those of earlier missions are reflected in the following assessment of the state of the economy and its prospects. Background Conditions 3. Guinea is potentially one of the richest countries in West Africa with substantial natural resources in the rural sector, mining, and to a lesser extent hydroelectric power. Its broad range of eco-climatic zones, from the sub-Saharan north to sub-tropical mountain areas in the center and tropical forest in the south, allows the production of a variety of agricul- tural commodities. At the time of Independence in 1958, Guinea was the leading African exporter of bananas and also exported considerable quan- tities of coffee, pineapple and palm oil; it was also able to meet most of its basic foodstuff requirements. In particular, the natural conditions for rice and livestock are suitable for expanded production. Guinea's mining potential includes bauxite reserves tentatively estimated at 8 billion tons, the largest -2- in the world, while readily exportable high-grade iron ore deposits are estimated at about two billion tons. Diamond and gold deposits have been identified and prospects for uranium mining and offshore oil exploration are being actively investigated. Past Performance 4. Notwithstanding Guinea's promising resource endowment, economic performance from the time of Independence until 1972 was disappointing. While lack of adequate data prevents a detailed assessment, estimated real growth of GNP during this period was less than 2.5 percent annually, lower than the annual estimated population growth rate of 2.9 percent. Agricultural exports practically vanished and Guinea became a net food importer, including of rice, its staple food. The years following Independence were characterized by a comprehensive reorganization of all economic and social activities in Guinea with a view to building a socialist economy. This entailed (a) a sharp curtailment of the private sector and the establishment of Government trading companies operating at controlled prices, (b) the creation of numerous other public enterprises, and (c) extensive State investment in industrial and social infrastructure. Returns on many projects were limited by managerial inexperience and planning inadequacies, and public enterprises absorbed high and rising amounts of Government resources. The capital costs and recurrent deficits of public investment soon exceeded budgetary savings and the Govern- ment resorted to heavy foreign borrowing and Central Bank advances to finance them. Foreign borrowing from Western and centrally planned economies was carried out on an ad hoc basis and soon resulted in unmanageable debt obliga- tions that could not be met by declining export proceeds. At the same time the liberal advances of the Central Bank led to a huge increase in money supply, galloping inflation and an overvalued exchange rate for the Syli. Consequently the public trading enterprises could neither obtain adequate supplies of local goods at official prices nor distribute them widely enough, and an active parallel market developed with prices substantially higher than official levels. Furthermore, the lack of foreign exchange caused sharp reductions in imports of raw materials and intermediate inputs, which con- strained production in manufacturing, agriculture and consumer goods. The economy thus stagnated in a vicious circle of foreign exchange shortages, poor incentives, and declining investments, output and exports. 5. While lack of foreign exchange sharply limited the supply of im- ported goods, and indirectly of local products as well, excess money supply strongly stimulated local demand, contributing from that side to the growing imbalance between supply and demand at official prices. As a result of 15 years of deficit financing, money supply reached a high level of nearly 70 percent of GDP in 1972 or over three times the level attained in most other West African countries. Most of this money overhang was concentrated in the urban areas where it aggravated the severe excess demand situation and absorbed much of the limited supply of goods that would otherwise have been available to the rural areas. - 3 - 6. These trends created considerable difficulties for the people. The rural population, about 80 percent of the total, operated principally at a subsistence level, selling as little as possible on the official mar- ket, and was largely excluded from the official distribution of imported consumer goods. On the other hand, the urban population had to compete for the limited supply of goods it could buy through official channels with rationing cards and supplement its needs in the unofficial market at very high prices. Large segments of the urban population were thus affected by the system as much as the average farmer. 7. With the start of two large bauxite mining operations, there was an abrupt rise in economic output. GNP increased by 33 percent between 1973 and 1977 in real terms, but stagnated in 1978 mainly because of the severe drought in 1977-78 and a levelling off of mining output as production approached full capacity. By 1978 per capita GDP reached about US$230. The rural sector continues to dominate the economy, although its share in GDP fell from 50% in 1963-64 to around 40% in 1976-78, while the mining sector contribution doubled, from 11% to 23% over the last 15 years. With the exception of the mining sector, characterized by mixed ownership since Independence, the modern sector continues to be State-owned while agricultural policies and public investment have encouraged collectivization and large-scale mechanized opera- tions. Recent Policy Trends 8. The productive and financial bases for a more dynamic economy have been strengthened over the last five years, although the country's economic development is still hampered by structural problems. This improvement in underlying conditions, brought about initially by the new mining operations, was further encouraged by the gradual adoption of more outward-oriented policies, particularly over the last three years vis-a-vis western coun- tries, and neighboring countries notably the Ivory Coast and Senegal in 1978. 9. Increased gross domestic output, especially for exports, and a stricter control of aggregate demand allowed Guinea to achieve a balance of trade surplus in 1977 and 1978, although the overall balance of payments has remained in deficit at about US$90 million per annum over the last three years. This deficit has been financed through accumulation of debt arrears and by a further decrease of gross official reserves, barely covering one month of imports at the end of 1978, as compared to almost three months at the end of 1975. While nearly half of gross export earnings has been used to pay for both direct foreign exchange costs of mining operations and mining related debt service, the remainder has gone mainly to increase imports of essential raw materials, foodstuffs and consumer goods, with a view to providing more current inputs for manufacturing and agriculture, and more incentives to producers. In the agricultural sector these measures have been comple- mented by a number of actions intended to increase production, such as more rural public investment, and more deliberate efforts to improve distribution -4- of consumer goods in the hinterland. Investment, however, has been concen- trated on mechanized and ox traction brigades whose output has been dis- appointing. Furthermore, inadequate producer prices and poor distribution of goods to rural producers through official trade channels remain serious obstacles. 10. Higher bauxite exports and favorable world market conditions have greatly increased Government revenue through taxation and sharing of profits. Thus, since 1975 Government current revenues and in particular tax revenue have increased markedly faster (23-24% p.a.) than GDP (about 9.4% p.a.), while public recurrent expenditures have increased at a moderate 12% per year, half as fast as revenues. Part of this additional revenue has been turned over to the Central Bank for amortization of accumulated Central Bank advances, and has served to sterilize some of the money overhang. Government expenditures have increased only moderately. These deflationary measures have led to a marked reduction of the money supply in relation to the GDP, an estimated 50% fall in prices on the parallel market over the last three years, and some improvement in the real purchasing power of most of Guinea's poorest popula- tion. Also, the Government has demonstrated a desire to better maintain and fully exploit existing capital assets, and has begun to allocate a larger proportion of its recurrent budget for much needed maintenance expenses and the purchase of spare parts. Importantly, the Government is also undertaking an examination of the viability of public enterprises; a few of the least successful have been closed down, while others have embarked on rehabilitation programs, sometimes with external assistance. The Government's objective is to make these enterprises self-sufficient and it has therefore recognized the need to revise pricing policies to enhance cash flows, ensure adequate credit to maintain working capital and stocks, and call upon foreign technical assistance (including post-rehabilitation management assistance) to strengthen operational efficiency. Finally, the Government, which has de facto tolerated private trading since 1977, recently legalized it as part of a move towards lessening restrictions on the circulation of goods and people internally and across national borders. 11. Outside the mining sector on the one hand, and the subsistence economy on the other, private investment is practically nil. The third and most recent development plan covered the period October 1973 to December 1978. Its original forecasts called for an investment outlay of US$2.9 billion, of which US$1.8 billion, or 64.6 percent of total investment, was to be in semipublic joint ventures with foreign investors (mainly in the mining sector). The plan was later scaled down to US$1.7 billion, to take into account delays in the implementation of iron ore projects at Mount Nimba and Simandou, and of bauxite mines at Dabola and Tougue; actual investment expenditure was finally estimated at US$1.3 billion, or 72.3 percent of the revised projections, of which 43% was financed by foreign capital inflows. Foreign borrowing was particularly heavy between 1973-1975, when it covered almost three-quarters of investment financing, as compared to less than one-fifth during the 1976-78 period. Large outlays in connection with pur- chase of equipment for rural production brigades, as well as for the transport -5- sector, were the main components in the high investment levels in the 1973-76 period, to the tune of about US$270 million per annum. In 1977-78, partly because of reduced availability of foreign financing, investment outlays fell to less than US$200 million per annum. Prospects 12. Guinea's long-run development prospects are good. However, the Government has not yet defined its development priorities for the next Plan period, other than the customary major projects whose financing is sought abroad. Based on Bank Group economic analysis and projections, it appears that Guinea's short and medium term economic development prospects will hinge critically on the rate of growth in the mining sector, while long term prospects will be affected by rural development. Mining exports increased from US$61 million in 1973 to about US$300 million in 1977-78. They are likely to reach about US$410 million in 1980, if all operations produce and export at full capacity, or some US$370 million if production levels do not increase. Despite this favorable evolution, the foreign exchange situation will remain tight and will become particularly critical if no new major sources of foreign exchange are identified in the near future. This situation is determined by (a) the high foreign exchange content of the operating costs in mining projects (up to half of gross export receipts); (b) increasingly high debt service obligations, including substantial arrears; and (c) import requirements for operation of the manufacturing, transport and other sectors, as well as for imports of foodstuff and consumer goods. Guinea will therefore need substantial amounts of external assistance to support its balance of payments until at least 1985. Foreign Assistance and External Debt 13. Over the past few years, Guinea has been diversifying its sources of foreign assistance. Renewed ties with the Western industrialized coun- tries, expanded relations with such OPEC countries as Algeria, Iraq, Libya, Kuwait, Saudi Arabia, and with multilateral sources have altered the past situation. Both the Bank Group and IMF have maintained a dialogue with the Government on a wide range of policy matters, and Guinea has qualified for drawings under the IMF first credit tranche and trust fund facilities. 14. However over the years the accumulation of foreign debt to finance investments in public infrastructure and public enterprises, as well as public consumption, have resulted in a burden of foreign obligations which is and will remain for years a major problem. Guinea's external public debt reached US$1.2 billion as of December 31, 1978, of which US$906 million was disbursed and outstanding. This represents about three-quarters of GDP. Loans denomi- nated in convertible currency amounted to somewhat less than half the total debt, and loans under bilateral clearing accounts to a little over half. Limited foreign exchange earnings have hindered the payment of debt service, and notwithstanding the negotiation of several rescheduling agreements, outstanding arrears on loans due in convertible currency totalled US$115 -6- million at the end of 1978. During 1978 debt service due to all foreign creditors amounted to US$116 million of which only US$64 million was actually paid. In that year the ratio of debt service payments due to gross export earnings was about 33 percent, and 48 percent when debt service on private borrowings, i.e. that owed by the two mixed bauxite companies, is included. 15. Service for debt outstanding at December 31, 1978 will average US$136 million p.a. over the 1979-81 period. Even if foreign capital inflows cover the entire foreign exchange costs of new investments, arrears between 1979-81 are likely to rise further, at a pace provisionally esti- mated at US$60 million per annum, of which two-thirds in convertible cur- rency. Service on new commitments would of course further increase this amount. With limited scope to maneuver, the Government has addressed the problem through debt rescheduling programs negotiated bilaterally with some creditors, and measures to improve debt management through the newly estab- lished External Debt Department in the Central Bank, to which the Bank has provided technical advice as part of its economic work. The Government has also undertaken a stricter control of investments financed by external credits, and a more judicious import program. During the next few years, Guinea will have to rely on substantial amounts of foreign assistance on concessionary terms not only for investment purposes but also to provide foreign exchange for intermediate and consumer goods imports, which are vital to stimulate economic activity and relieve supply constraints particularly in the rural sector. Furthermore, despite the Government's achievements in keeping the growth of current consumption expenditures below the growth of revenue, net public savings after debt service will be negligible and local cost financing by external sources will be needed. PART II - BANK GROUP OPERATIONS IN GUINEA 16. To date, the Bank Group has financed seven operations in Guinea. Two loans totalling US$73.5 million in 1968 and 1971 financed infrastructure for the Boke bauxite mining project. IDA credits of US$7.0 million, US$14 million, and US$8.0 million respectively were granted in June 1975 for a pineapple development project, in December 1975 for a first road maintenance project, and in September 1978 for a first education project. In January 1979 two credits were signed, one of US$12.5 million for a first water supply and sanitation project; the second, US$1.1 million for a power engineering and repair project. Annex II contains a sunmary of Bank loans and IDA credits and notes on the execution of ongoing projects as of July 31, 1979. 17. In view of the general shortage of foreign exchange and the poor state of infrastructure in Guinea, the Bank Group's first projects aimed at promoting mining and agricultural exports and rehabilitating the road system. -7- The Boke project was completed satisfactorily and bauxite output has increased steadily. Despite some delays in execution, the Daboya project is now export- ing fresh fruit to Europe and a second pineapple project based on expanded smallholder development is under consideration. The First Highway project followed shortly after the Daboya credit and has been largely successful in rehabilitating and maintaining a major part of the road infrastructure network vital for agricultural development. 18. Government priorities, which include (i) upgrading and maintaining basic infrastructure, (ii) development of human resources, (iii) expansion of mining, and (iv) rural development, generally coincide with Bank Group objec- tives. Encouraged by our experience in the execution of earlier projects, we are preparing follow-up or new operations in each of these four sectors, with particular emphasis on sectoral planning, institution building and training. The Water Supply and Power Engineering Projects, the latter initially concen- trating on the deteriorated system in Conakry, and a more comprehensive First Power Project to be appraised in late 1979, concentrate on the first objec- tive. The proposed Second Highway Project further supports this strategy and would expand the road rehabilitation and maintenance work begun under the First Highway Project. It would also strengthen certain sector institutions to help Guineans acquire and successfully apply the engineering and technical skills necessary to plan, design, and implement road transport projects. The Association's First Education Project arose out of the clear need for more trained technical manpower and aims to assist the Government in improving and expanding training programs for industrial technicians and skilled workers with emphasis on institution building. Because of the vital importance of mining in helping alleviate the country's foreign exchange shortage, the Bank Group is also considering further intervention in this sector. Feasibility studies are being reviewed for the Nimba Iron Ore Mining project. 19. The Government of Guinea gives a high priority to development of its agricultural and livestock potential. It is in the rural sector, however, that the country is experiencing the greatest difficulty in harnessing its development potential. The Bank Group has attempted to support this Govern- ment priority but has found it difficult to find non-enclave projects suitable for financing. Basic institutional support for the rural sector, economic incentives to farmers and herdsmen, the use of modern technology, as well as applied agricultural research activity are virtually non-existent in the country. This affects the willingness of Guinean farmers to respond to rural development efforts. To come to grips with these fundamental issues we have been working with Government to prepare a first series of projects which entail direct intervention in the livestock and rice sectors. The proposed Rice Development Project being presented simultaneously stresses institution building at the national level; in addition, it would introduce on a pilot basis low cost improved rice production methods to test farmer response in a remote but potentially highly productive part of the country. A livestock project, now in its final stages of preparation, would aim at institutional strengthening of the Ministry's livestock development capacity, improvements through veterinary measures of animal health and productivity, and selective -8- training of livestock extension staff. In order to get the full benefit from the technical and institutional strengthening anticipated under these and future rural development projects, the agricultural extension service must be strengthened throughout. Such improvements may be undertaken as part of a second education project now under consideration. 20. The Bank Group's share in Guinea's external debt outstanding and disbursed and of total public debt service amounted to 8.4 percent and 14.2 percent respectively in 1978 with IDA representing one-fifth of Bank Group commitments and a negligible proportion of service payments. By 1985 the Bank Group's share in debt outstanding will be about 7 percent but with a larger proportion of it IDA; because most of the debt presently owed the Bank will be amortized by the mid-eighties and payments on new IDA borrowings will not yet be due, IBRD's share of debt service will drop to 2 percent, while that of IDA will remain insignificant. PART III - THE TRANSPORT SECTOR 21. Guinea's transport system consists of about 14,000 km of classified primary, secondary, and feeder roads, 1,100 km of railways, two deep water ports and ten airfields. The central Conakry - Mamou - Dabola - Kankan corridor (see Map) has traditionally been the main artery of the country. It consists of a 600 km railway built 70 years ago, paralleled by a highway which is gravel from Mamou onwards. A secondary route branches southeast from Mamou to Kissidougou and eventually to N'zerekore, and a northern route leads eastward from the port of Kamsar. Over the years railway traffic has fallen. In 1977 it consisted of only 12,500 tons of goods compared to 27,000 tons in 1973, and 417,000 passengers, of which over 90 percent were commuters. The railway's ability to maintain and renew equipment and infrastructure has also declined. A FED consultant recently reviewed the status and prospects of the railway. The network of roads and railways is adequate in relation to popula- tion distribution and economic potential. Organization 22. There are many ministries sharing responsibility for transport sector planning and management. The Ministry of Transport (MOT) is respon- sible for regulation of the sector and investment planning for ports, railways and airports. The Ministry of Public Works (MPW) looks after planning and execution of road construction and maintenance. The plans for the transport sector are reviewed by the Ministry of Economy and Finance and the Ministry of Planning and Cooperation which coordinates the Government's overall invest- ment program and seeks foreign financing. -9- 23. Poor coordination, compounded by weak planning and management capability at all levels, is the central problem in the transport sector. Sound guidelines and well-defined programs for future investment are lacking and neither MOT nor the Ministry of Planning has the capacity to effectively analyze investment plans or ensure overall transport coordination. Moreover, investment planning by MOT is discharged through the various bodies directly responsible for transport management (the railway, port authorities, and the Conakry airport), and very little arbitration takes place before the proposals reach the Ministry of Planning. 24. In addition to the management problems mentioned above, coordination of road/rail traffic has been poor since the abolition in November 1975 of the Office National Rail-Route, which formerly was responsible for transport coordination. Road transport was reorganized under a new trucking agency called COTRA (Road Transport Company) with a fleet numbering about 500 trucks, whereas the railway became an autonomous enterprise. COTRA, with a truckers' cooperative in each of the seven provinces of Guinea, is responsible for intra- and inter-regional freight movement by road and provides a reasonable level of freight service. As a start toward helping ameliorate the planning and coordination problems in the road sector, the proposed project would in- troduce within MPW a capability for investment planning and project prepara- tion. Plans and Investments 25. Reliable information on the transport system and commodity flows in Guinea is very limited and it is therefore difficult to make a comprehensive assessment of the sector and its needs. The lack of qualified planning staff and the absence of a specific transport policy were reflected in the overly ambitious 1973/74-1977/78 Five Year Developnent Plan. The plan proposed a total investment in the transport sector of about US$386 million, approxi- mately 40 percent of total public investment. It placed major emphasis on: construction of selected primary roads and bridges; improvement of road maintenance; and improvement of ports, airports, and rail and road transport. The Plan was suspended in 1974 when the Government realized that the goals were unrealistic. Of the seven major paving projects, only one, the Kissidougou-Kankan road, was completed. The Government's recognition that a large paving program was premature in view of the relatively low traffic volumes on the primary road network marked the beginning of a more appropriate strategy for the road sector. The change in emphasis was illustrated by the Government's acceptance in 1975 of IDA assistance in the rehabilitation and improved maintenance of some 2,500 kms of primary interregional roads. The Road Sector 26. Of the existing classified road network, some 7,000 km are inter- regional roads. Much of the primary network has been paved, the length of paved roads having increased from 190 km in 1967 to over 1,000 km at present. However, the remaining network consists of extremely poor gravel and earth roads. With a lack of adequate maintenance, Guinea's roads have been deteri- orating rapidly. - 10 - 27. Over the past fifteen years, the Government has attached consider- able importance to upgrading the links from the coast to the interior. The main focus has been on major roads from the country's two principal ports including (i) the paving of the central Conakry-Mamou route paralleling the main raily- line and leading eastwards to Kankan; (ii) the paving of a southern route leading from Mamou south-eastwards to Kissidougou and ulti- mately to the forest region; and (iii) the rehabilitation of a northern route running eastwards from the new port of Kamsar to Boke and the Foutah-Djallon area around Labe. Attention has also been given to upgrading key secondary road links feeding into the central Conakry-Mamou axis. While recognizing the need for an all-weather road between Conakry and Kankan, the Government appears to have opted to delay upgrading the Mamou-Kankan road, possibly in order to protect declining rail traffic within the corridor, and instead, has just completed paving the road from Kissidougou to Kankan which thus provides a through paved road (although a circuitous one) from Kankan to the capital, outside the zone of influence of the railway. 28. Road users contribute substantially to Government revenues through annual vehicle registration and inspection fees, transport licenses and import duties and taxes on vehicles and fuel. Estimates indicate that total revenue from these sources totalled about US$25.0 million equivalent in 1977. There is a clear need for allocation of increased proportions of these funds to highway maintenance as past funding has been inadequate. Under the First Project the Government has already budgeted more revenues for this purpose. For the proposed second, it has agreed to gradually increase funding so that by project completion it would be financing the full cost of maintaining the roads upgraded under IDA's two projects. Bank Group Role 29. IDA's highway sector strategy, with which the Government is in agreement, aims at improving Guinea's road infrastructure while creating in MPW a capable and technically competent sector institution. IDA's First Highway Project (Credit 596-GUI, FY76, US$14.0 million) is nearly completed and helped rehabilitate about 2,500 km of high priority national roads. While it attempted primarily to remove the serious physical obstacles to transport, the project began to develop basic technical and managerial skills. The proposed Second Highway Project would continue these efforts, with special emphasis on road sector planning and project preparation and on effective financial arrangements for sector operations. A possible Third Project could involve reconstruction of one of Guinea's main highways. PART IV - THE PROJECT 30. The project was conceived as the second step of a long-term program begun in 1976 with IDA's help to provide an adequate and properly maintained road infrastructure to support Guinea's economic development. Specifically, - 11 - the project continues and virtually completes the backlog rehabilitation of the high-priority primary and secondary roads, extends and reinforces highway maintenance over this network, and prepares the way for further road develop- ment by improving the sectoral planning and execution capacity of the Ministry of Public Works (MPW). 31. The project was prepared by the Government and consultants under the First Highway Project, and a preparation report was submitted to IDA in August 1978, with appraisal following in October 1978. Negotiations were held in Washington from July 23 to 30, 1979. The Guinean delegation was led by His Excellency, Mr. Abraham Kabassan Keita, Minister of Public Works. The Staff Appraisal Report No. 2363-GUI, dated August 20, 1979, has been circulated separately to the Executive Directors. Supplementary project data appear in Annex III. The attached Map (IBRD 14070) shows the roads to be rehabilitated and maintained under the project. Project Description 32. The proposed project would consist of a three-year program of road rehabilitation (1,548 km) and maintenance (4,622 km including the 1,548 km), strengthening of the National Public Works (Soils) Laboratory, and preinvest- ment studies for reconstruction of some sections of the 250-km Conakry-Mamou road. The project would provide for: (i) purchase of highway and workshop equipment and spare parts; fuel, materials and supplies for the operating costs of road rehabilitation and incremental recurrent costs of highway maintenance; and fellowships and the continuation of technical assistance to MW for project implementation and training (243 man-months); (ii) renovation of the existing soils laboratory and its equipment, and technical assistance for training its staff (36 field man-months); and (iii) consultant services for preparing a feasibility study and detailed engineering for reconstruction of the Conakry- Mamou road; in carrying out this study, consultants would train MFW staff counterparts who would form the nucleus of a new Studies and Programming Division. Project Implementation 33. The MPW through its Directorate General of Roads and Bridges (DGRB) will be responsible for implementation of the project. DGRB will be assisted by consultants to be selected in agreement with and under terms and conditions satisfactory to IDA (Section 3.02 of draft DCA and draft EEC Special Action Credit Agreement). Training, with the help of consultants, of equipment operators and mechanics will continue at the training center in Conakry, built and equipped under the First Highway Project. On-the-job training of - 12 - semi-skilled laborers will continue within the regravelling and maintenance brigades, and special attention will be given to training of accountants and store-keepers. As DGRB intends to strengthen its planning and design capabil- ities, the consultants' terms of reference for the feasibility study include training of Guinean engineers and economists as counterparts co the consul- tants team. This small group, having been trained and having acquired some experience in the techniques of economic analysis, would become the basis of a Studies and Programming Unit in MPW, whose responsibilities would include planning and budgeting. The project will take about three and a half years to complete. Agreement was obtained from the Government at negotiations that it would submit a project completion report to IDA within three months of the final disbursement (Section 3.04(c) draft DCA and draft EEC Special Action Credit Agreement). Project Cost 34. The total cost of the project is estimated at US$31.9 million equivalent of which taxes on non-exempt items (fuel and lubricants) are estimated at US$3.2 million equivalent. The foreign exchange cost is US$21.6 million (75% of the cost net of taxes) and the local cost US$7.1 million equivalent. The project cost includes the capital costs of US$24.1 million for road rehabilitation, the National Public Works Laboratory and the pre- investment study, and incremental recurrent costs of about US$4.6 million to expand road maintenance on Guinea's priority road network. Cost estimates are based on July 1979 prices and include physical contingencies of 10 percent and price contingencies ranging from 6 to 7.5 percent per annum. Costs of consultant services are estimated to average US$6,500 per month plus reimbursable expenses of US$3,500 per month. Financing Plan 35. The foreign exchange cost of the project, estimated at US$21.6 mil- lion, would be financed as follows: US$11.3 million from IDA, about US$3.8 million from the EEC Special Action Account, US$6.0 million from BADEA, and US$500,000 from the Government, the latter item representing part of the direct foreign cost of recurrent expenditures for routine maintenance. Local costs would be borne by the Government (US$5.2 million), IDA (US$1.7 million), and the EEC Special Action Account (US$0.2 million). The Government would pay for all taxes on non-exempt items, which would amount to about US$3.2 million. The following table shows the breakdown of the financing plan (net of taxes) by component and sources of financing: - 13 - (US$ thousands) IDA EEC BADEA Government Foreign Local Foreign Local Foreign Local Foreign Local Road Rehabilitation and Maintenance Equipment and spare parts 2,460 - 2,900 - 2,850 - - - Workshop equipment and tools - - 600 - - - - - Operating costs, road rehabilitation 3,750 1,400 - - 2,180 - - 2,230 Incremental recurrent costs, road maintenance 1,000 - - - - - 500 2,970 Buildings - - 300 200 - - - - Technical assistance and fellowships 1,970 120 - - 970 - - - National Public Works (Soils) Laboratory 900 100 - Conakry-Mamou Road Preinvestment Study 11170 130 - - - - - - 11,250 1,750 3,800 200 6,000 - 500 5,200 TOTAL (rounded) 13,000 4,000 6,000 5,700 Continuation of Financing of Road Maintenance 36. Inadequate attention to routine maintenance in the past has been the basic cause for the deterioration of Guinea's road network; this inatten- tion was reflected in the absence of appropriate mechanisms for the timely provision of foreign exchange and local currency to cover capital and operat- ing costs of road maintenance. In the First Highway Project, whose physical execution has resulted in the rehabilitation of 2500 km of the country's main road network, the Government financed all of the local costs of the program and thereby helped assure its successful completion, in close collaboration with the Association. For the proposed project, Government agreed to continue providing local financial support for a second phase of road rehabilitation; the project moreover envisages expansion of routine maintenance operations throughout the country to safeguard investments in construction and rehabili- tation of roads. The financing plan proposed includes a US$1.0 million contribution from IDA towards the recurrent foreign exchange costs of the routine maintenance to be carried out during the project period. Government will cover 100% of the local recurrent costs of routine maintenance and will contribute US$0.5 million toward its recurrent foreign exchange costs as well. IDA's US$1.0 million contribution will cover 100% of the foreign exchange requirements of routine maintenance in the first year of the project, 2/3 of the requirements in the second year, and 1/3 in the third. Government's - 14 - foreign exchange contributions will be progressively increased, beginning in the second year, and will be used to cover the costs of imported fuel, lubri- cants, and road construction materials. 37. objective of the project is to have Government regularly budget- ing adequate funds, in foreign exchange and local currency, to assure the continuation of a coherent maintenance program after the end of the project. A second objective is to have Government regularly allocating additional funds to cover, on its own account, the foreign and local costs of further road rehabilitation and other essential repairs to road infrastructure. By the end of the project, Government would be expected to budget a minimum of US$5.4 million annually of which about $1.5 million should be in foreign exchange for equipment replacement, spare parts, and other imported goods. If the experi- ence of the ongoing project continues, equipment provided for road maintenance under the first operation and that to be purchased under this one will have a very high rate of utilization; it is probable, therefore, that replacement of some major items would be required before the end of the project. Accord- ingly, Government agreed during negotiations to make, after project comple- tion, the annual minimum budgetary allocations mentioned above (to be adjusted for inflation) and, in addition, to accept a concomitant obligation to budget, in the last project year, a special tranche of about $1.5 million in foreign exchange for replacing worn-out equipment and maintaining adequate stocks of spare parts (Section 4.03(b) and (c) of draft DCA and Special Action Credit Agreement). 38. During execution of the First Project, it became obvious that MPW would benefit greatly from the establishment of a revolving fund to guarantee the timely availability of budgeted funds to MPW for the project's local expenditures. Government therefore agreed at negotiations to establish such a revolving fund and to regularly replenish it to a level of 20 million Sylis; the operations of this fund would be regularly audited and its creation would be a condition of effectiveness of the IDA and Special Action Credits (Section 3.01(b) of draft DCA and Special Action Credit Agreement). To overcome the effects of Guinea's persistent scarcity of foreign exchange and the cumbersome administrative controls over imports, the Government agreed during negotiations to also set up a special foreign exchange mechanism for MPW which would assure the timely availability to MPW of foreign currency for imports of replacement equipment, spare parts and materials. It would not be needed until 1982 (the third year of the project), but passing appropriate legislation for its creation would be a precondition for disbursement by the Association of US$1.5 million for equipment for the rehabilitation component in late 1981 (Section 4.03(c)(i) of draft DCA and Special Action Credit Agreement). Procurement 39. Items to be financed by IDA will be procured on the basis of international competitive bidding in accordance with Bank guidelines. New highway and workshop equipment and spare parts for existing MPW equipment to be financed by the EEC Special Action Credit will be procured from the - 15 - original suppliers or from other eligible sources, according to the procure- ment rules applying to the EEC Special Action Account. Equipment and mate- rials to be financed in parallel by BADEA will be procured according to its procurement rules. Equipment or groups of the same items of equipment with a value of less than US$50,000 but in the aggregate not exceeding US$300,000 may be procured on the basis of quotations from local suppliers or, where appro- priate, by limited international tendering. Fuel and lubricants will be bought from ONAH (about US$9.3 million including taxes) and cement (to be financed by BADEA) from BATIPORT (about US$1.4 million). Both are the State- owned sole suppliers of these items. Fuel and lubricants are part of the Government's bulk procurement arrangements for the country. Supplies come from IDA member countries and prices are reasonable. The possibility of procuring cement through limited international tendering will be explored. Construction of DGRB's office and workshops and the laboratory building (about US$700,000) will be executed by DGRB and contractors selected after local advertising and competitive bidding in accordance with procurement procedures of the Government, acceptable to IDA. 40. The Government intends to retain the services of consultants Louis Berger International, Inc./Tractionel (USA/Belgium) to continue providing technical assistance for the road rehabilitation and maintenance program begun under the First Highway Project. The consultants performance has been satisfactory and BADEA has agreed to joint financing of this technical assis- tance. The Government also intends to select CEBTP (France), who prepared the project's soils laboratory component, to provide equipment and technical assistance to the National Public Works Laboratory. CEBTP manages or assists several state-owned road soils laboratories in French-speaking Africa, and set up the original laboratory in Conakry before Guinea's independence in 1958. The preinvestment studies of the Conakry-Mamou road will be carried out by qualifed and experienced consultants assisted by MPW staff counter- parts. Disbursement 41. The proposed IDA credit of US$13.0 million would be disbursed on the following basis: (i) 100 percent of the cif cost of equipment and spare parts or 95 percent of the cost of imported items purchased locally; (ii) 100 percent of the cif cost of bituminous paving materials and supplies for road rehabilitation and periodic maintenance; (iii) for expenditures incurred under the Revolving Fund for road rehabilitation and maintenance in project years 1, 2 and 3 respec- tively: 46% of total costs to a maximum of US$1,900,000, 42% of total costs to a maximum of US$1,800,000, and 37% of total costs to a maximum of US$1,700,000, reflecting anticipated expenditures for imported materials and supplies (except cement, culverts, and metal products) procured locally and for wages for road rehabilitation; - 16 - (iv) 100% of the local costs and 67% of foreign costs for consultants' services for road rehabilitation and main- tenance; and (v) 100% of total expenditures for the National Public Works Laboratory, for the Conakry-Mamou road preinvestmen,L study, and for auditing of project accounts. The EEC Special Action Credit of about US$4.0 million equivalent would be disbursed on the following basis: (i) 100% of the cif cost, or 95% of the cost of items locally procured for: highway equipment and spare parts, spare parts for existing MPW equipment, and workshop and laboratory equipment and tools; (ii) 100% of total expenditures for construction of DGRB's office and workshops. These disbursement percentages have been calculated on the basis of c.i.f. prices, taxes, and local markups on imported goods, and in view of the Govern- ment's policy to exempt all goods directly imported for development projects from all taxes and duties, and to require that such taxes be paid on locally- purchased goods. The proposed BADEA loan would be disbursed on a pari passu basis with the IDA Credit, for 33% of the foreign costs of consultants' ser- vices for road rehabilitation and maintenance (US$970,000). BADEA would also finance 100% of the foreign cost of about US$2.8 million of road maintenance equipment and spare parts and about US$2.2 million for metal products, cul- verts and cement for the road rehabilitation program. Benefits and Risks 42. The road rehabilitation and maintenance program and supporting technical assistance (together amounting to 91 percent of total project cost) would yield an economic rate of return (ERR) of 49 percent. The ERR for the road rehabilitation component varies from 11 to 54 percent while the road maintenance operations would yield ERR's of 78 percent on paved roads and over 100 percent on gravel roads. While the specific benefits of the technical assistance cannot be quantified, their cost is included in the benefit-cost calculation. With a 15 percent increase in equipment capital costs, the ERR falls to 37 percent, which is still satisfactory. The benefits from reha- bilitating the National Public Works Laboratory and from the study of the Conakry-Mamou road cannot be quantified (9 percent of total project cost) and therefore these components have not been included in calculating the overall economic rate of return. The training components within each, however, are expected to have a substantial institutional impact and to help prepare the way for future highway development in Guinea. 43. By improving mobility and the transport of goods and people, the project would have a substantial impact on the Guinean economy as a whole. To the extent that generated traffic is a proxy for increased production in the areas of influence of the roads, the rural population living in the - 17 - regions served by the roads should benefit from easier access to national markets. The project's direct benefits accrue to the operators of motor vehicles, mainly the state-owned transport organizations and the Government. They account for most of the truck traffic and about half the other traffic (or about 60 percent of total traffic) and will receive about 70% of the benefits. The remaining 30 percent accrues to private drivex.. ad operators generally engaged in passenger transport. 44. Performance under the previous project indicates that there are no special technical risks. The standard of rehabilitation achieved in the 1977-79 operating seasons was good, with careful attention being paid to materials selection, drainage and proper compaction. Within MPW efficient use was made of the equipment, material and personnel mobilized in a coordi- nated rehabilitation and maintenance program, and Guinean staff of satisfactory number and caliber worked effectively under the first project; continued collaboration from technical assistance adAisors is envi.aged. Close and frequent supervision is planned to continue the productire dialogue estab- lished during execution of the on-going project. Overall sector planning and management will be improved through the creation of the new Studies and Programming Unit in MPW. Though all of these factors minimize technical and managerial risks, the project does face the risk that the Guineans would not allocate sufficient resources to support an adequate road maintenance program. The special arrangements noted in para. 37 and 38 should help overcome this problem. PART V - LEGAL INSTRUMENTS AND AUTHORITY 45. The draft Development Credit Agreement between the Revolutionary People's Republic of Guinea and the Association, the draft EEC Special Action Credit Agreement between the Revolutionary People's Republic of Guinea and the Association as Administrator of the EEC Special Action Account established with funds contributed by the member states of the EEC, and the Recommendation of the Committee provided for in Article V Section I (d) of the Articles of Agreement of the Association are being distributed to the Executive Directors separately. 46. Features of the draft Development Credit Agreement and the draft Special Action Credit Agreement of special interest are referred to in paragraphs 33-40 and in Section III Annex III of this report. Conditions of effectiveness of the proposed Credits are cross-effectiveness with the proposed US$6.0 million loan from BADEA, and the Government's making a 20 million Syli deposit in the project's local currency reiolving fund. 47. 1 am satisfied that the proposed Development Credit would comply with the Articles of Agreement of the Association and that the proposed EEC Special Action Credit would comply with the criteria established by the Agreement between the Association, the EEC and its member states dated May 2, 1978. - 18 - PART VI - RECOMMENDATION 48. I recommend that the Executive Directors approve the proposed Development Credit and EEC Special Action Credit. Robert S. McNamara President by I.P.M. Cargill Attachments August 28, 1979 * - 19 - Page 1 TABLE 3A GUINEA - SOCIAL INDICATORS DATA SHEET REFERENCE GROUPS (ADJUSTED A AGES LAND AREA (THOUSAND SQ. M.) GUINEA - MOST RECENT ESTIMATE) TOTAL 245.9 SAME SAME NEXT HIGHER AGRICULTURAL 71.7 MOST RECENT GEOGRAPHIC INCOME INCOME 1960 /b 1970 /b ESTIMATE /b REGION /c GROUP /d GROUP /e GNP PER CAPITA (USS) 110.0 140.0 220.0 261.4 181.9 430.3 ENERGY CONSUMPTION PER CAPITA (KILOGRAMS OF COAL EQUIVALENT) 65.0 98.0 93.0 80.6 83.9 262.1 POPb.JATiON AND VITAL STATISTICS POPULATION, MID-YEAR (MILLIONS) 3.1 4.1 5.0 URBAN POPULATION (PERCENT OF TOTAL) 10.0 14.0 16.0 17.1 16.2 24.6 POPULATION PROJECTIONS POPULATION IN YEAR 2000 (MILLIONS) 9.0 STATIONARY POPULATION (MILLIONS) 23.0 YEAR STATIONARY POPULATION IS REACHED 2170 POPULATION DENSITY PER SQ. 1M. 13.0 17.0 20.0 18.4 49.4 45.3 PER SQ. 1M. AGRICULTURAL LAND 45.0 58.0 70.0 50.8 252.0 149.0 POPULATION AGE STRUCTURE (PERCENT) 0-14 Y&S. 42.1 42.5 43.1 44.1 43.1 45.2 15-64 YES. 55.1 54.7 54.0 52.9 53.2 51.9 65 YRS. AND ABOVE 2.8 2.8 2.9 2.8 3.0 2.8 POPULATION GROWTH RATE (PERCENT) TOTAL 2.2 2.9 2 5.7 4.6 4.3 URBAN 9.0 6.2 65 CRUDE BIRTH RATE (PER THOUSAND) 48.0 47.3 46.0 46.3 42.4 39.4 CRUDE DEATH RATE (PER THOUSAND) 28.0 24.0 21.0 17.2 15.9 11.7 GROSS REPRODUCTION RATE 3.5/ 3.1 3.1 3.1 2.9 2.7 FAMILY PLANNING ACCEPTORS, ANNUAL (THOUSANDS) .. ** ** USERS (PERCENT OF MARRIED WOMEN) .. .. .. .. 12.2 13.2 FOOD AND NUTRITION INDEX OF FOOD PRODUCTION PER CAPITA (1969-71-100) 102.2 100.0 86.0 94.3 98.2 99.6 PER CAPITA SUPPLY OF CALORIES (PERCENT OF REQUIREMENTS) 83.0/h 90.0 84.0 89.5 93.3 94.7 PROTEINS (GRAMS PER DAY) 41.0/h 44.0 42.7 55.8 52.1 54.3 Of WHICH ANIMAL AND PULSE .. 29.0/1 .. 17.9 13.6 17.4 CHILD (AGES 1-4) MORTALITY RATE 45.0 36.0 30.0 2Z.3 18.5 11.4 HEALTH LIFE EXPECTANCY AT BIRTH (YEARS) 35.0 40.0 44.0 47.0 49.3 54.7 INFANT MORTALITY RATE (PER THOUSAND) .. .. 105.4 68.1 ACCESS TO SAFE WATER (PERCENT OF POPULATION) TOTAL .. .. 10.0 20.3 26.3 34.4 URBAN , ., .. 27.0 53.9 58.5 57.9 RURAL .. .. 3.0 10.1 15.8 21.2 ACCESS TO EXCRETA DISPOSAL (PERCENT OF POPULATION) TOTAL .. L3.0 .. 22.5 16.0 40.8 URBAN .. 70.0 .. 62.5 65.1 71.3 RURAL .. 2.0 .. 13.9 3.5 27.7 POPULATION PER PHYSICIAN 48000.0 31090.0 15500.0/ 17424.7 11396.4 6799.4 POPULATION PER NURSING PERSON 3890.0 5000.0 2330.0fL 2506.6 5552.4 1522.1 POPULATION PER HOSPITAL BED TOTAL 1110.0 980.0/k .. 502.3 1417.1 726.5 URBAN 240.0 280.0 .. 201.4 197.3 272.7 RURAL 2640.0 1020.0 .. 1403.6 2445.9 1404.4 ADMISSIONS PER HOSPITAL BED .. 16.0 .. 23.4 24.8 27.5 HOUSING AVERAGE SIZE OF HOUSEHOLD TOTAL .. .. .. 4.9 5.3 5.4 URBAN .. .. .. 4.9 4.9 5.1 RURAL .. .. .. 5.5 5.4 5.5 AVERAGE NUMBER OF PERSONS ?ER ROOM TOTAL .. .. .. URBAN .. .. .. RURAL .. .. .. ACCESS TO ELECTRICITY (PERCENT OF DWELLINGS) TOTAL .. .. ., .. 22.5 28.1 URBAN .. .. .. .. 17.8 45.1 RURAL .. .. .. ** *. 9.9 - 20 - Pass 2 TABLE 3A GUIMIAL INDICATORS DATA BSHEET INA RFERENCE GRDUPS (ADJUSTED ASIAACS - MOST RECZNT ESTTE1)A SAME WEN ar HIGHER- MOST RECENT GEOGRAPHIC INCOME INCOME 1960 L 1970 L ESTIMATE L MEGION L GROUP L GROUP L EDUCATION ADJUSTED ENROLLMENT RATIOS PRIMARY: TOTAL 30.0 33.0 .. 59.0 63.3 82.7 MALE 44.0 45.0 .. 64.2 79.1 87.3 FEMALE 16.0 21.0 .. 44.2 48.4 75.8 SECONDARY: TOTAL 2.0 13.0 .. 9.0 16.7 21.4 MALE 3.0 21.0 .. 12.0 22.1 33.0 FEMALE 0.4 5.0 .. 4.4 10.2 15.5 VOCATIONAL ENROL. (% OF SEC3NDARY) .. 3.2 .. 7.0 5.6 9.8 PUPIL-TEACHER RATIO PRIMARY 66.0 36.0 .. 42.2 41.0 34.1 SECONDARY 26.0 23.0 .. 22.9 21.7 23.4 ADULT LITERACY RATE (PERCENT) 7.0 9.0/f .. 20.8 31.2 54.0 CONSUMPTION PASSENGER CARS PER THOUSAND POPULATION 2.0 2.0 2.0 4.0 2.8 9.3 RADIO RECEIVERS PER THOUSAND POPULATION 13.0 23.0 25.0 44.3 27.2 76.9 TV RECEIVERS PER THOUSAND POPULATION .. .. .. 2.9 2.4 13.5 NEWSPAPER ("DAILY GENERAL INTEREST") CIRCULATION PER THOUSAND POPULATION 0.2 1.0 1.0 5.6 5.3 18.3 CINEMA ANNUAL ATTENDANCE PER CAPITA .. .. .. 0.4 1.1 2.5 LABOR FORCE TOTAL LABOR FORCE (THOUSANDS) 1400.0 1900.0 2100.0 FEMALE (PERCENT) 40.3 40.3 40.1 31.9 24.8 29.2 AGRICULTURE (PERCENT) 88.2 84.7 83.0 77.6 69.4 62.7 INDUSTRY (PERCENT) 6.1 8.5 10.0 7.9 10.0 11.9 PARTICIPATION RATE (PERCENT) TOTAL 49.6 47.7 46.1 40.8 36.9 37.1 MALE 59.5 57.4 55.8 53.9 52.4 48.8 FEMALE 39.9 38.1 36.6 25.6 18.0 20.4 ECONOMIC DEPENDENCY RATIO 1.2 1.0 1.1 1.2 1.2 1.4 INCOME DISTRIBUTION PERCENT OF PRIVATE INCOME RECEIVED BY HIGHEST 5 PERCENT OF HOUSEHOLDS .. .. .. .. .. 15.2 HIGHEST 20 PERCENT OF HOUSEHOLDS .. .. .. .. .. 48.2 LOWEST 20 PERCENT OF HOUSEHOLDS .. .. .. .. .. 6.3 IDWEST 40 PERCENT OF HOUSEHOLDS .. .. .. .. .. 16.3 POVERTY TARGET GROUPS ESTIMATED ABSOLUTE POVERTY INCOME LEVEL (US$ PER CAPITA) URBAN .. .. .. 187.6 99.2 241.3 RURAL .. ** *96*8 78.9 136.6 ESTIMATED RELATIVE POVERTY INCOME LEVEL (US$ PER CAPITA) URBAN .. .. 52.0 138.4 91.9 179.7 RURAL .. .. .. 71.0 54.8 103.7 ESTIMATED POPULATION BELOW ABSOLUTE POVERTY INCOME LEVEL (PERCENT) URBAN .. .. .. 34.5 44.1 24.8 RURAL .. .. .. 48.7 53.9 37.5 Not available Not applicable. NOTES /a The adjusted group averages for each indicator are population-weighted geometric means, excluding the extreme values of the indicator and the most populated country in each group. Coverage of countries among the indicators depends on availability of data and is not uniform. /b Unless otherwise noted, data for 1960 refer to any year between 1959 and 1961; for 1970, between 1969 and 1971; and for Most Recent Estimate, between 1974 and 1977. /c Africa South of Sahara; /d Low Income ($280 or less per capita, 1976); /e Lower Middle Income ($281-550 per capita, 1976); 7f 1965; / African population only; /h 1961-65 average; /i 1964-66; L[ WHO preliminary/estimated data; /k Government hospitals only. May, 1979 - 21 - &!gg Although 0he da. or dr,- fra1 scu,soo s.1e7 1l judnd the t atutberltatve god rnlIsble, tt CoaLd *to* bo acd that they any not ha ite*C. tionally cafrable because of the lack of standIardianj definitions and Iacaion osed by different countrkein to.lilen th. dalt. The data fr., nonetheldes. uD.ful to d~o.rtb. ordar- of -Antud., indic.. tronda, an. charactor stts CMrALM mal}r differences between countrtl. The. .4distad 0 a vosvers ita for .each indicator st. populatimon ighted gUesric maus, excludlag the encr values of t%. todicerir and the omt populated costry in each group. Du. to lack of data, group overagsu of all indie.t.e for Capital Surplos 011 xporters and of tndlcaltre of Ac0.99 ta water and careta dispo.l, in..tag, no1.me d.strtbuttio mnd Povs,ty for other c.«try groupa arg polOatOio ited genmtric Meanb Mihout encalon of the oetr~ valcef fag the motn "Uso sc~utr? O 2fu j' srs - Total surface area compris n 1.0d erse @ d Inloed wstern. gag • g rof peopL4 (tot, , an 1 u es r d most recent tattmae of ogricultuirl areo used t~pörrily peas m phroeetep of chetr rorneptin population,. Egestg dtappoal or penoanently for rop, p.starea, oarket and kivhsen g ~rdens ot to may inc6ud. tho collection And dispual. with or with%ut tremiat,f 1td fallow., bi~ «et.0e oa ete-ar by ..tar-bo~a 0y.tem nm the . of pit privlan and #tallar Is« ltattee. e C T •1l foppr WiL caG"" .pit. aiew at current varixat pr&Cu, Loeistansr ohosin - PoPuatont divid.d by n~mbe, of practttng phyil- ralculated by asta coron method a& tfrId Sanok Atla (1975-77 bhslk); cia= quallfi.d fra a oodial school et untveratry leal. 190, 1970, and 1977 dat . ft=to rse - Population dvde. by makr of bprttctn C M48 andfemal gradate iuGrGB, prcttcal nurse3 . ad A9a.t40t s~. |ERU CSimpS i CAPITA - 4kmual cone0ption of assercil energ (0001 Feenlatten 0e hostel bod - to6al. ~rb*s, and rural - .opulation (rotot, 0nd lite. potrel1, .atr l oa d hydra-, ~uclear ad gdothero.t orban, and rurol) dgvided by thotr r.petve ~nhar of hosptrAl bed* electricityi kt l ,ogram of o.t equtivlntO per captt.; 1960, 1970 avattébl. ta publi. ond privat. genorol an4 spec.alised hospital *nd r. and 1974 data. hblitation centers. ~pitalg are establisteneses persaastly *edffed by ForetiT[1N AND _TA1. STATYS5C ge least oe phytt.Laa. Etabllsmnts providt.n principLly custodia1 Total popul2ttpon id-ver <!!Llltos - A. of J.1y 1; 1960, 1970, d are ~ eC ot Incued, &oral hopttat., hor-e , iacludo health aud ~edi- 1977 da.c.- a1 ntr not prsmamntly st.fted be . physican (hut by a ~dcal a- Urban poputstgt gg rcent of total1 - Ratt of urea. t tootal pplatoa; estact, 0nur.. a Mif, etc.) wh1ch offer lu-pattont aco adat oed diffren, deftnittons of -rba or.as may afft-r ompaprabiltcy of da provide l tseited rnge of mdic.t 1.lleta. toong counots; 1%0, 1970 ood 1975 dt.. A so jga d • Total mh.r of adt.sottn to or dtchares PopulatI Project s frm hoepitt divid.d by th. rnener of bda. poputittonn Year 2000 - Current populatto prjectiona are hå. mo 1975 ftotl population by g and srxzlnd theil .ortalIty .a fertixty races. proj.etion p.rosetero for sortalty rateu caprio. of 3 1.-vte L:ergge size of household (persona per hoteth,.1d) - tot1 grbma, opd rural - assin1in lffe expetanoocy at blrth t-nreasng with contry'. per c~gita A hoseold consist. of a group ot .ndtduals owho shae. living quartert In,co level, sad fonsl If expectaocy sohtilt.Lag .t 77.5 years. ~d tiheir min ma.l. A bordor or lod_.r may or my not b Includ.A ln thn Tho parmter. for fr.tlity rat. alo .hav 3 Ivel. .ssing dclim houshold for etatistteal purpoea. i ferili.ty according to 11c o rl t ad pest family platnnin pe- Average noober of person per roo' - to.1. ura,. ad rurl - Avarg. nuber formance, Iach country is then -signad mne of the.. 9 combinati~o of personu per ro 1n oll, urban, and rurlt occupied co-Im4tonal dollt"g, of nortalltv 0nd fPretity 0re0d0 for projctim prpass. rospectively. Dvelling. exclude nos-pemanent struc*uras and unacup ed rrts. S tonary poulo_ton - In Sta,tiory Population, thra i o groyth r..osn to electricity (percent of d~elliowgl - total. urbn and= ura, - 2 c the birth rat. Is o,ual to tho death rat., and atso tho ag Contool dwellings wth oletrictty .n ivin quartera as pgr*entage of structur. remais cont.t..t_ Tht is -chevcd only after fertility ra1e0 total, urbe.. and rurat delling. roapecttvly. declin to tho rpLac=t laval of vtt uot »op "octin rate, when coch generation of won replaces Itself exactly. The Btatoonry paplatio .0.e oas estimated ou tho basls of th. projected cherectorisOtc of h0 ditd enrjf,l~.ooll%punt ratio population in tho year 2000. and the a of 01cin of frtility rate Primry school - total. mat. and fst. - oss 0ota a f.te otroll- to replecamot levt- ~s1 *1 all afes at tho prlmary level as prcentages of raopaettve pr~Ter Yer0 sttoory population ts tcted - Th a yar whan Statipsary popul- ochool-eg pouateron ; normally tclöde. childre. %gUd 6-11 years but P12,oto2 ha. been reached. ddjulted for different taugt.h of primry oducacion; for cautrina witth foooplt*o ~ d-n.00' univra educatto enrolöset 7 ezoeed 100 prcent stscooo popf are Per sq. N i -Md-yer population per squa- kilnter (100 hectar~s) bo or abor tho officiaL school age. of total . Sondary chool - total Sal! and female - Coputed .. bo s condar- due- - or sq. ft. aricultral land - Copt.td .. abo-e for agricultural tand tion requires at lest our years of cproved priarv intructon; provides only. general gocattotal, or meachor tr.nisg Instruct-ons for puplO --ally of fopulation psttruc.ro fabrc!nt) - Children (0-14 ytor$), vorking-.e 12 to 7 y1ar. of ag*; forrspoientecourse ro gnarally *ecldd. (15.64 ys,r., and retrod <6 yearo .an over5 as percentage. of Id- Vocational o.1ett.41 t %, 2 6:1 t of sca • oc atoImul ntetcution ~ .cld Par popult_on; 190, 1970 .n 1977 data. tochntcl, idustrial, or other progreas uhlb opera opednOl, or as Poptulion *rowth 0a00 (perE!Z - tot - - tnfoal growth ratof total dermo te of t-ory nstitutots. PId-year poputattona for 1950-60. 1-0-70. .nd 1970-77. Pupil-teacher rati. - pringe., and second.r - Total 0tudontA, -,0o11d in Population, growth rat0 (percmn)-~rban - Annual growthO rates of tirbant primar. and sondary loveLo divided by nuiber of taschera i. the cre- ~pouations f,or 10A-,0. tf0-0, and 1970-75. oi la t. _,de hioti ra. (per chu,und) - nual liva birtho par thouand of Adult låterac rat. f(prcantl - Litaratu 0at fabla tc road an wrttal e. .l,d-voer popaon: 1960. 190 and l97 data. a prcen*a of total adult population a~9d 15 yeara and ovar. Crude death ratt (per ousand)04 • Annal deaths per thousand of .0d- year popla,Ig; 1960, 1970 and 1977 data. Gross reprotlén rate - Average omber of daughctr. . ~oan of1t beer Pamse. r rs or s- hNo.. ad oulation) - Paconger ..ta comprise eotor 0.r. in har normal reprodutitve period If sh. ..pif e.es pre...t ege satting tue. tha sight frons; eclUde. ebulanc-s, he.rsa. 0nd mIlitry sft,iic fortility rat-; usually fEt--year averag.. ending 1. 1960, vehicles. 1970, ad 1 975. Aadio receivers <per thouosnd populaotio} - All types of r~cI-r. for radio Family pl.nnng-aceorsa annuat (thoun.s)- A0.001 namebtr of broadcafto to gLore pbic for thousand of populatica; exclud. unlice.sd ..cept.r' nf birth-tntroI d-tv. undkr ~uspi-as of ational famtly rece1vr coesttisa and tn yearan ~ regtration of radio *at. va. ti planiLog progra~. ffe.t; data for recent years may not b cparablc slce met countrie. Fostly Plofntsn - goers (prcent of married bon} - Percnotage of aboltshed icensing. marriad womn of child-baaring ag. (15-44. ye0r0> who use birt-anto TO receivro (ger thousand poulton) - yr receiver0 for broadcat to feneral d.vices to all marred 0am0n in s ag 5rop public p.r thoa poputon; oxclude snlacense TTvt receivr. n o-- trits and naro Ohen rgftoratton of T V ~e was in offect. 0 D r dTIN 1spp circul,tion (pur ..ttt~hua 1oultion. - Show- the a.e.rag. .11rcla 1ndex of food production 000 capita (1969-71 * 100) - Indeo of por capito t1n of "daIly g.nera1 interatt newo por", defåsd s a. partcIcal publi- nlo1 production of .11 food cooditie. Prodution e,cludes 0.0d and cation dvoted prt-rly to recordfng gnarsa nos. It i codered to fe.d and is ou caländar year b,sis. C -atti.. cover primary good4 be idly" tf it appars at least <our ptios a w. (N.g. .ugarcano tnstead of sugar) which are edibla 0n0cnti .utrient0 Ciasm. annual tttndence pro capita ner rtar - Baed on the .b.r of t1ckets 1.g. coffee and 000 -I. exclud.d). adgrag.t. productio of e-ch cou0try so1d d.ring the yar, I1.di g d!istoho to dri--i.n c.£~0=0 ad mobil* is bas04 on notional overoge producer pr_c weights, unt. Per carpit supply of cllorles <percent of requirmentp) - C-mput.d fr-n energy equival-nt of net fond suppll-e ailabin t contry pr tapit. M F2 per day. Av.ilable supplies compriie dositc production, import ts 4 Toll a fore. (thousands) - Ecooi..ally acttiv pron-, including arm d exporto and change. lo atock. Not s~pplie. axclud. oail f=nd. nee. forts and uneleployed but -ocludtng hous.v , td t., etc. ofint- quantit-e s.d in food pocessing . and Lo..l tn di. tribution. Re- t0on On various cou nrie. are not ooprable. qui~remnta were: stimt.d by FAO based on phynioogical needs for n- fealo (percent) - Femala labor fotcn ao percentag0 0f total labor forc. * activity and health considenring environmetal temporarOre, body Aortculture <prcent) - La.bo force 1. fr..ing, forostry. hetn and fi.btg eIghts, l ge and sex dlstrbutons of popI.lto., and allootO pr- as percentge of fot Labor forn. cent for wste at household lavl. Industry (p~rcent - Labor forc0 in .1in,. contructon nufacturlrg and Pr 0spita suppy of protrin (grams r day) - Proitincont.nt of 900 ele rticity, ar and d.a as poertage of total bor force. capita000 ntopply of food por day. Net supply of food i, deftn.d as portitipatton rea (pecent) - totl. =le, and te~ela - P-rticpotton or above. .rqulr~nts for ll countries establtshed by USDA provida for activity rates are co s total, oale, and feal. bor forr... a .inimi-s allowance of 60, gr- of total Protein p-r day and 10 gr percentagcs of total, =ls,d fmale popl.tiun of all 0go0 r.pctively; of ani.l and pu1se pron, of hI 1 gr ,0e1shou benma frotein. 190, 1970 aed 1975 data. Tho. are IO-s partictpc on rat r mfl«cti These standard are 1-00e thab these of 75 greoz of total p 1tei90 nd age-e atrture of tho popuaton, nd log tim treud. A fe. 0.timates 23 gra~s of ant~al protei0 as an avereg. for the world, propod by .. ~ f .0 a n t d f t FAO to tho Third 00r14 Pond Survey, are1 froaton. ~ .ato-rc1s. Por capi.t rotein supply fr animal and puls. - Protein supply of 004 o dapqndaen tLo - gatto of nd 15 d 65 .nd derIed frol,mals and puI.. in gr-ma per day. e ab., fore in a grop f L5-44 ya Chil (a1 1-0 ortali- rat 0 per thogsan0) - A o,I sta9 pr tho-- i :ad n ag. gro..p 1-4 y0er, to chidrn ito hi 9* C0groskp1 for f rpntan of p'rOste i (both ts cash and 010nd) tecoived by tchoot $ developng cOutrie 0 dat0001i0e fra0 life tb1.0 1. t hool 20 pert,, plorPgn 20 (0ro0th. tad wh_äsa 40 ~ 4 tnt MJE of h.ueholdo. Il1 x t tirth lvers) - Avermm0 "wobr of yestW of ille-maate ing a 1b0t0 10 14It. and 197? dat-, ¿<ff1t TA 00 5 'rfaot oortali tT rate (ger tlheugend) - Arooal deathe .ofolfat. ,ade Estimoa4ø obolooe puoeriy in 10ret 00lMig, nee 0, cpi -.00rban and o'ral • .ne y000 of a00 per thousand live ~th. 1olu , p 1ovty ino Ie1is a t inm level heldo.obtoh a Mnalf 2 A_.cçs to sjf. watfr <p-rconcf t - ~ Mttios.Lly 400 4, 41e pli, 4 e.entiol a94.~o1 d 00g0raent A o 05t Kos of people 1tot., orbön, and r LIl enah 6el agas to affordahe, afeater supply ionldos tre_td ~orfac saaefl erGt teab r t tag ,s1001ve 99v00 b.1M lBun < g C Edp0) -rban *0d s at - _ ].~nocainatdwaero uh .. that fr prota.tod hebel0ak 4ng, aoCiod.r fetat povert 1no.s t o dao-letrd of overag for caplea ard nfrr wells l' torentae.9 of Iter respectve polatt^o - pton~l Incon of hoouury, U~i.n levet l. der4ved f~MW rural 2 * ac f-oot.n or standpot loat.d oset Lothoa tevl ol ad jaaoasr for kfisheg o f li WlM 10 oOr ffira-s' 200 feters fro, a house0 0ay 00 cuoldered 0e1,4. bet s ttn e0*00001,1e oatiead .aaooarian bj11 abo.ok nrise. la0510isO stfoO .tOarsamt -0000h0n004 acce,. of Ct, house. lo rural arnas reaonnble .00400 voud-OIpy oua'.sr,oOc of pop.ultp ,u'rban, and euraS0 .wh are ,aooli pu0r" 06hato 0ie b 0.01r0f or ooesier. 0* thte householtd do4o0 v toll apend 090 Ec8.0h10 0nd M0eta1 Data 01ivison disfrnportionate fort of th d-v in f-rhL.C ch faly. iada~ 00d0 «c&t11 D.l&.la 0nd Pro990t1uO netmen i M.h '~9h - 22 - ANN:X I Pege 4 REVOLUTIONARY PEOPLE' S REPUBLIC OF GUINEA ECONOMIC INDICATORS GROSS NATIONAL PRODuCT IN 1977 ANNIAL RATE OF GROWTV (M. constant ortes) %1975-7 1976-77 1977-85 projected CN* at Market Prices 996.8 100.0 11.7 5.2 Gross Domestic Investment 216.8 21.7 193.3 a -31.5 l .. Gross National Saving 189.1 19.0 276.1 Ll -3.4 / 1 . Current Account Balance -28.8 2.9 Exports of Goods, NFS 316.6 31.8 28.4 13.9 Imports of Goods, NFs 256.7 25.8 7.1 -18.0 OUTPUT LABOR FORCE AID PRODUCTIVTTY INl 1976 AND 1977 Value Added IS$ Million % 1976 1977 Average 1976 1977 Average Agriculture 469.6 346.8 408.2 44.3 32.3 38.3 Industry and Mining 324. 434.3 379.6 30.7 40.5 35.6 Services 265.1 291.4 278-2 25.0 27.2 2 GDP at Market Prices 1,059.5 1,072.5 1,066.0 100.0 100.0 100.0 CogsnMENT FMNZ General Government S-lis Billion % of GDP 19,6 1977 1976 1977 1978 Cirrent Receipts 5.42 6.16 7.51 23.9. 27.2 31.8 Current Expenditures 3.83 3.86 5.28 16.9 17.0 22.4 Current Surplus 3 1.59 2.30 2.23 7.0 10.1 9.5 Capital Expendituree 1.71 2.18 7.5 9.6 External Assistance (net)/ 1.78 0.72 0.01 7.9 3.2 n Central Government Sylts Billion % of GDP 1976 1977 1978 1976 1977 1978 Current Receipts 4.86 5.52 6.90 21.5 24.3 29.3 Current Expenditures 3.45 3.42 4.62 15.2 15.1 19.6 Current Surplus /, 1.41 2.10 2.28 6.2 9.3 9.7 Capital Expenditures L 1.61 2.07 *, 7.1 9.1 ,, External Assistance L4 1.78 0.72 0.01 7.9 3.2 n .ONEY, CREDIT and PRICES 1976 1977 1978 (billion Sylis and period) Money and Quasi Money 6.7 4.2 4.5 Rink Credit to Public Sector 8.8 6.5 7.2 bank Credit to Private Sector 1.0 1.1 1.1 (Percentages) Money and Quasi Money as % of GDP 29.6 18.5 19.1 General Price Index (1972 * 100)6 140.3 147.5 153.2 Annual % changes in: Bank Credit to Public Sector 17. &U -25.4 9.5 Bank Credit to Private Sector -11.7 14.1 -0.1 L Using implicit GNP deflstors (Atlas computations. June 1979). Growth rates calculated from data in Sylis. / Both 1976 and 197? are uncharacceritic vears: agricultural production dropped in 1977 because of a drought, ard consrruction and public works registered a large increase compared to previous years. / In 1975 and 1976 tie Govern.wnt rcaliz,d a sizeaLle budget surplus rhich was used to repay part of the outstanding debt with the Ceitril Rank, thereby reducing the macy overhang. /4 Excluding forcln granta. (external borrowing only). 5 Financed vin 7reasury. /7(111P irplicit deflator (Alta* conputaticn. June 1979) /7 The sharp incre:su in credil. to che pubilic sector was caused by the transFer of rovernment claims on the public sector to the banking system. .ot available not applfcable n negAul1ible August 1979 - 23 - Page 5 O1Tc(tfAtYPRPLC' S REPI.TC OF CqVA IM!!!IAt!!ETS ID LP _!A!.EL SAAC @ OF PAYMITS MANDlSl EXPORTS (Averase 1976-78) (Preliminary Estimates) 12 1977 1978 US .l i. (US$ Militon) Bauxite 214.4 70.7 Experts of Goods, NFS 252.3 316.6 348.5 Alumina 79.3 26.1 Imports of Coods, NFS -284.8 -256.7 -283.5 Other Commodities 9.7 3 Resource Gap (deficit - ) -32.0 59.9 65.0 Total 303.4 100.0 Interest Payments /1 -32.1 -38.1 *43.5 Workers' Remittances Other Factor Payments (not) *50.2 -50.5 -55.5 9X3jRNAL DEBT. December 31, L978 Net Transfers Balance on Current Account -114.1 -28.8 -34.0 Direct Foreign Investment Public Debt 906.1 Net MLT Borrowing Total Outstanding & Disbursed 906.1 Disbarsements, Public Borrowing 67.3 49.4 112.8 Amortization, Public Debt L -. -49.6 -47.1 Subtotal, Public Borrowing 38.5 -0.2 65.7 DEST SERVICE RATIO FOR 1978 L 32.7% Private Sector (net) -25.4 -24.9 -29.1 Total Borrowng 13.1 -25.1 36.6 of whicht public debt 18.3% Capital Grants *. private debt of 14.3% Other Capital (net) . * .. mixed enterprises /1 Other Items n.e.L. Increase in Reserves L -55.6 -23.5 -72.1 BR DIDA LENDING (en4 1978) US$ Mln Cross Reserves (nd year) . 53.2 50.5 29.2 IJ&.D Net Reserves (and year) -110.0 -133.5 -205.6 Outstanding & Disbursed 81.1 14.9 Fuel and Related Materials Undisbursed 1. Imports -13.2 -18.6 -27.1 of vhichi Petroleum *13.2 -18.6 -27.1 Outstanding including 61.1 29.0 Exports *. .. Undisbursed RATES OF EXCHANCE /3 Through S/$ 1 1971 9 1 1974 1975 16 1977 1978 National Accounts Data 24.7 24.6 22.7 20.7 20.5 20.3 21.4 21.1 19.7 (annual geometric averages) Balance of Payments Data 24.7 22.7 22.7 20.5 20.2 21.1 21.2 20.3 18.9 (and of period) 1 Actual payments on dibt service. hive been less (see text) resulting in increases in foreign liabilitics and a decline in net foreign rese-vs2. 2 From reserve position in US$ at end of period /3 IrS L Actual service payments resorted to exports of goods and NFS. Ll CBC and FRICUIA. . not available . not applicable August 1979 -24 - ANNEX II Page 1 THE STATUS OF BANK GROUP OPERATIONS IN GUINEA A. Statement of Bank Loans and IDA Credits (as of July 31, 1979) Loan or Amount (US$ million) Credit Number Year Borrower Purpose Bank IDA Undisbursed Two loans have been fully disbursed. 73.5 569-GUI 1975 Republic of Pineapple 7.0 1.4 Guinea Development 596-GUI 1976 Republic of First Highway 14.0 1.3 Guinea 849-GUI 1978 Republic of First Education 8.0 7.6 Guinea 870-GUI 1978 Revolutionary First Water 12.5 11.5 People's Supply and Republic of Sanitation Guinea S-22-GUI 1978 Revolutionary Power Engineer- 1.1 0.7 People's ing and Repair Republic of Project Guinea TOTAL 73.5 42.6 of which has been repaid 13.8 0.0 TOTAL now outstanding 59.7 42.6 TOTAL now held by Bank and IDA 59.7 42.6 TOTAL undisbursed 0.0 22.5 22.5 B. Statement of IFC Investments Guinea is not a member of IFC. - 25 - ANNEX II Page 2 C. Projects in Execution 1/ Cr. 569-GUI Pineapple Development Project: US$7.0 million Credit of July 2, 1975; Effectiveness Date: October 22, 1975; Closing Date: June 30, 1981. The project consists of establishing an irrigated pineapple estate and of providing pineapple growers in its vicinity with supporting services. Due to the poor performance of the contractor, irrigation works were delayed by one year but the use of provisional irrigation facilities minimized the impact of such delays on planting and production targets. Total production in 1977/78 exceeded 1,100 tons of which 580 tons were exported fresh to Paris at premium prices. Measures are being taken to better adapt the quality of this output to the marketing standards of importers and thus increase exports. Works are now completed and irrigation started in December 1978. Irrigation works for the second phase network, which will double the total plantation area to 420 hectares, commenced in early 1979. Cr. 596-GUI First Highway Project; US$14.0 million Credit of December 24, 1975; Effectiveness Date: March 19, 1976; Closing Date: June 30, 1980. Progress on the First Highway Project, a road rehabilitation and maintenance program covering 2,500 km of high-priority roads, is satisfactory although execution was delayed by about one year due to slow tendering and bidding. Training of mechanics and equipment operators is progressing well and the new management measures introduced by the Ministry of Public Works with the help of consultants are effectively controlling the project's financial, equipment and human resources. Cr. 849-GUI First Education Project; US$8.0 million Credit of September 28, 1978; Effectiveness Date: January 16, 1979; Closing Date: June 30, 1983. The project aims at helping alleviate the country's shortage of skilled workers by improving and expanding technical training programs, and at strengthening the country's educational planning and project implementa- tion capacities. Progress is satisfactory. I/ These notes are designed to inform the Executive Directors regarding the progress of projects in execution, and in particular to report any problems which are being encountered, and the action being taken to remedy them. They should be read in this sense, and with the under- standing that they do not purport to present a balanced evaluation of strengths and weaknesses in project execution. - 26 - ANNEX II Page 3 Cr. 870-GUI First Water Supply and Sanitation Project; US$12.5 million Credit of Janaury 12, 1979; Effective: April 13, 1979; Closing Date: March 31, 1983. The project's objectives are to fulfill the immediate water supply and drainage needs of Conakry, provide satisfactory sanitation to most of its population, and strengthen institutions operating in the sector. The project is essentially problem free. Cr. S-22-GUI Power Engineering and Repair Project; US$1.1 million Credit of January 12, 1979; Effective: April 6, 1979; Closing Date: December 31, 1980. The project is intended to complete preparatory wrk on a large rehabilitation program for the Conakry power system part of which will be appraised in end-1979 as the Bank Group's First Power Project in Guinea. Replacement equipment has been ordered and the Grandes Chutes Dam feasibility study is completed. - 27 - ANNEX III SUPPLEMENTARY PROJECT DATA SHEET Section I: Timetable of Key Events (a) Preparation Report: August 1978 (b) Project Preparation Agency: Government with assistance of consultants (c) Appraisal Mission: October 1978 (d) Negotiations: July 1979 (c) Planned Effectiveness: November 1979 Section II: Special IDA Project Implementation Actions Close project supervision by frequent IDA missions. Section III: Special Conditions (a) the Government will prepare, and submit to IDA within three months of the final disbursement, a completion report (para. 33). (b) the Government shall employ consultants whose qualifica- tions, experience, and terms and conditions of employment are satisfactory to the Association (paras. 33 and 40); (c) the Government will establish a mechanism to provide to MPW annually, by the last project year, US$1.5 million in foreign exchange for equipment replacement and spare parts (para. 37). (d) the Government will proide annually beginning in 1983, the equivalent of US$3.2 million (in addition to the above US$1.5 million) for operating expenses for road maintenance and will adjust this amount as appropriate to reflect changes in the cost of fuel, materials, and wages (para. 37). The IDA Credit Agreement and the EEC Special Action Credit Agreement will become effective jointly, and this effectiveness will be contingent upon the effectiveness of the loan agreement between Guinea and BADEA providing for a loan in an amount equivalent to US$6.0 million, and on the Government's having made a 20 million Syli deposit in the project's local currency revolv- ing fund.  -W-' .-- 5 E N E C;ý L4 -i ·· e o n.. . ... y - .- . ' ~Mo - L ----- . O B Sol i ~~~~ lpL,-BOLL r f' -,--- - -- GUINE A ' - . PROPOSED SECOND HIGHWAY. RvR.A.LEO PROJECT -- 9.e er .. i ... ....i. 7 - i K Ji~), a..-- --T- L * .I*..,.4 '* do Il -o- -lc .W,MFE .--. 4%-ON E 'B E R l A '1:, '-'PRO.-:T. A