Somalia - Central Rangelands Development Project

Document of C The World Bank FILE COPY FOR OFFICIAL USE ONLY Report No. P-2484-So REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE SOMALI DEMOCRATIC REPUBLIC FOR A CENTRAL RANGELANDS DEVELOPMENT PROJECT April 25, 1979 This document has a restricted distribution and may be used by recipients only in the performance of their offcial duties. Its contents may not otherwise be diclosegd without World Bank authorization. |  CURRENCY EQUIVALENTS (CY 1978, and March 1979) Currency Unit = Somali Shillings (So.Sh.) - 100 cents So.Sh. 1.00 = US$ 0.1589 US$ 1.00 = So.Sh. 6.295 WEIGHTS AND MEASURES 2 1 hectare (ha) 10,000 m = 2.47 acres 2 1 square kilometer (km ) = 100 ha = 0.39 sq. miles 1 metric ton (mt) = 1,000 kg = 2,204 lbs. GLOSSARY OF ABBREVIATIONS CRDP - Central Rangelands Development Project DAP - epartment of Animal Production FAO - Food and Agriculture Organization, U.N. ILCA - International Livestock Center for Africa LDA - Livestock Development Agency MLFR - Ministry of Livestock, Forestry and Range NRA - National Range Agency NRDP - Northern Rangelands Development Project ODM - Overseas Development Ministry, U.K. RMEA - Regional Mission for East Africa, World Bank UNDP - United Nations Development Program, U.N. USAID - United States Agency for International Development WFP - World Food Program, U.N. PPF - Project Preparation Facility, IDA FISCAL YEAR January 1 - December 31  FOR OFFICIAL USE ONLY SOMALIA - CENTRAL RANGELANDS DEVELOPMENT PROJECT Credit and Project Summary Borrower: Somali Democratic Republic Beneficiary: National Range Agency Amount: US$8.0 million Terms: Standard Project Description: The Project would, over a period of six years, consolidate and improve rangelands and livestock production in the project area, increase the income of the pastoralLsts through the introduction of a system of range utiLization, and make way for the gradual concentration of pastoral communities which would be helpful to the provision of social services. This would be achieved by improving the veterinary service; providing non-formal and formal education; strengthening the National Range Agency's administration; and initiating nurseries, town shelter belts, and water and soil conservation activities. The benefits of the Project would include an increase in employment, livestock off-take, milk and meat consumption, and per capita income of pastoralists. The major risks in project implementation would be a lower than estimated rate of-acceptance of the Project by the pastoralists and delays in the recruitment of international staff. This document has a restricted distribution and may be used by recipients only in the performance of their ofcial duties. Its contents may not otherwise be disclosed without World Bank authorization.   - ii - Estimated Project Cost: US$ Million % of Project Component Local Cost Foreign Cost Total Cost Total Range Development 5.0 7.7 12.7 27 Training 1.8 4.9 6.7 15 Range Studies & Trials 0.4 2.9 3.3 7 Veterinary Services 0.8 2.4 3.2 7 NRA Headquarters 1.5 6.1 7.6 16 Contingencies 4.1 8.7 12,8 28 Total Project Costs 13.6 32.7 46.3 100 Financing Plan: Source Amount US$ Million % of Total IDA 8.0 17 IFAD 9.0 20 USAID 15.0 32 ODM 4.0 9 WFP 4.3 9 Government 6.0 13 Total 46.3 100 Estimated Disbursements; US$ Million 1980 1981 1982 1983 1984 1985 1986 Annual 0.4 1.5 2.4 1.8 0.8 0.8 0.3 Cumulative 0.4 1.9 4.3 6.1 6.9 7.7 8.0 Rate of Return: 15% (Calculated on 60% of total project costs). Staff Appraisal Report: Report No. 2163-SO, dated April 12, 1979.   INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE SOMALI DEMOCRATIC REPUBLIC FOR A CENTRAL RANGELANDS DEVELOPMENT PROJECT 1. I submit the following report and recommendation on a proposed Credit to the Somali Democratic Republic for the equivalent of US$8.() mil- lion on standard IDA terms to help finance the Central Rangelands Development Project. Additional financing for the project would be obtained, on conces- sionary terms, from the USAID (about US$15 million), British ODM (about US$4 million equivalent), International Fund for Agricultural Development (about US$9 million equivalent) and the World Food Program (about US$4.3 million equivalent). PART I - THE ECONOMY 1/ 2. A Country Economic Memorandum (Report No. 2244-SO) was distributed to the Executive Directors in January, 1979. Country data sheets are attached as Annex I. 3. The Somali Democratic Republic gained its independence in 1960 and the present Government came into power in 1969. In 1976, a political party, the Somali Revolutionary Socialist Party, was formed and became the main political institution. At present, the country is still suffering from the hostilities in the border areas in the Ogaden, and the phasing-out of Soviet aid and technical assistance in 1977. This, combined with large-scale migration oE Somali workers to the Middle East has led the Government to re-examine its development strategy. Although no major strategy has yet emerged, some cautious steps tending to increase the role of market forces in the economy have been taken. 4. Somalia is a large country with a 3,000 kilometer coastline; its land mass varies from a hot and arid coastal plain, to rugged mountains, and plateaux, and lowlands of varying fertility and rainfall. Only 13% of the land is said to be arable, but with water the limiting constraint, only a small fraction of this potentially arable land is, in fact, cultivated. Of a total population of approximately 3.7 million, over two-thirds are nomads and semi-nomads, who depend on livestock for their livelihood and about 20-25% are farmers cultivating land along the Juba and Shebelli rivers and in the higher-rainfall Bay and North-west regions. The existence of several minerals has been confirmed but with exploration still in its early stages, commercial viability remains to be proved. Short of other known resources, Somalia's prospects center on agricultural and livestock development in which progress will depend upon careful management of scarce land and water resources. 1/ This section is the same as that of the Agricultural Extension and Training Project.  -2- 5. The small monetary sector of the economy provides only limited opportunities for employment. Apart from the traditional export of live- stock, commercial agriculture is mainly centered on the production and export of bananas, in which foreign concession holders are still important, and the production of sugar for the domestic market. The expansion of manufac- turing and other service sectors of the economy is limited by the small size of the domestic market, poor infrastructure, and the shortage of capital and entrepreneurial experience. IDA staff estimate that about 70% of the population live at subsistence levels of about US$200-250 per family of five. Social services are still very inadequate, the primary school enrollment ratio (at about 34% in 1977), though considerably higher than five years ago, remains relatively low. There is little economic data on Somalia. Even basic figures such as GNP, population, number of livestock, or output of major agricultural crops are only rough estimates. With a per capita income in the order of US$110. in 1977, the UN classifies Somalia as one of the least developed countries. Development Strategy 6. Since 1970 the Government has adhered to a program of "scientific socialism", emphasizing egalitarianism and social justice, development through the public sector, nationalization of certain foreign enterprises, and the formation of cooperatives. While the Government has always stated that there is room for private initiative in Somalia and several privately financed projects have been implemented, the main emphasis has been given to develop- ment of the public sector. Public ownership and management have expanded through nationalization, creation, and growth of enterprises. The parastatal sector now includes more than 50 autonomous agencies that have eliminated private enterprises in wholesale trade and banking while taking a major share in manufacturing. The Five-Year Development Plan 1974-78 (FYDP) was essentially a public investment program that allowed for a few small private ventures. Overall Plan implementation reached for about 60% of the initial allocation, but this figure must be considered indicative, rather than precise. Although it provided a needed impetus to investment in the economy, the Plan does not seem to have played a major role in the allocative process. Despite the Government's initial intentions, industry and mining, and infrastructure, have received more public investment than agriculture. At the same time, public enterprises have expanded without firm Government control, owing to a large extent to the inadequacies of monitoring instruments. 7. Since the bulk of the population is engaged in herding or in sub- sistence farming, a development strategy for Somalia should be based on agriculture and livestock resources. The major development goals of the Somali Government include self-sufficiency in food grains, the partial substi- tution of other food imports (oils, rice) and improvement of the lot of the traditional nomadic herdsmen through settlement programs and improvements in livestock production and marketing facilities. The current emphasis on irrigated agriculture is meant to make the country less dependent on the erratic pattern of rainfall, and assure more stable and predictable increases in output. However, rainfed agriculture which occupies the largest number of  -3- farm families is also being assisted. Improvements in livestock production and marketing are being promoted together with projects aiming at the reha- bilitation of the rangelands. 8. Somalia has made considerable progress in meeting some basic needs, a program of literacy and primary education has had noticeable results, and an effective system of food supply has been established. In other areas of the social sectors, however, the record is less impressive, particularly in water supply, sanitation, and health where services frequently seem to benefit mainly the urban population. On the other hand, economic growth has been rather slow, making it difficult for Somalia to pursue its basic needs policies vigorously. The 1979-81 Plan bases its development of industry on t'he pro- cessing of domestic raw materials to substitute for imports, althoug'h there are a few rather large investments which do not conform to this policy. Finally, the Government places emphasis on developing infrastructure, espec- ially transportation and communications. Economic Performance, Problems, and Sectoral Developments 9. Tlhe 1974-78 Five-Year Plan has been revised several times but remained overambitious with respect to both financial and implementation capacities. Financial implementation reached about 60%, 55%, 77% and 73% of the targets in the first four years. However, the absence of adequate monitoring and evaluation makes it impossible to determine the economic impact of t'hese expenditures. In real terms, annual investment has probably been increasing and what was an essentially financial constraint in 1973-74 had, by 1976, turned into an implementation constraint which has worsened recently as a result of the exodus of skilled Somalis to the neighboring oil-exporting countries (see below, para 10). Many incomplete projects from the 1974-78 Plan are therefore included in a Three-Year Development Plan, 1979-81, under which investment of So.Sh. 5.7 billion (of which So.Sh. 3.4 billion are carry-overs) is contemplated. 10. About 100,000 Somalis have migrated to work in the neighboring oil-exporting states and their total earnings equal about ten times the total domestic value added in Somalia's modern sector. Labor migration has been a phenomenon that the Government neither organizes nor controls, and its magni- tude is such that the drain of skills and the inflow of private funds may affect the smooth functioning of a publicly-controlled economy. This migra- tion is seriously depleting Somalia's already low stocks of qualified and skilled manpower, thereby reducing the absorptive capacity of the country and weakening its institutions. Migrant remittances have financed imports of about US$50 million in 1977, roughly equivalent to Somalia's exports of livestock (75% of total export value). This import trade consists mostly of basic consumers' goods (foods, textiles, some durables); to a certain extent, however, these remittances could be mobilized to finance investment. At present, there are few incentives and opportunities for private capital to engage in productive investment - and this partly explains why remittances finance consumption goods. There is no comprehensive public policy on remit- tances, though IDA staff and the Government are discussing measures for formulation of a suitable policy for attracting the remittances intc, productive investments in Somalia.  -4- 11. Budgetary policies have generally been conservative and efforts have been made to mobilize resources through taxation. Although the drought and the border problems have adversely affected the Government's budget, the external grants they attracted have considerably eased their financial impact. However, expenditures on basic needs and defense have risen so much that the current budget fell into deficit in 1977 (by So.Sh. 2.5 million) for the first time since 1971. The border problems of 1977 may only have accelerated an outcome that was already visible. In fact, the supply of government services nationwide, and the recurrent cost implications of recent public investments and policies, especially in productive services (such as agricul- tural extension) and basic needs (such as education, health and drinking water) will make it increasingly difficult for the budget to generate savings. 12. The external financial constraint is mainly the result of slow growing exports, with relatively stable imports over the past three years. The structure of the balance of payments in 1977 was essentially similar to that of previous years, with low exports equivalent to US$71.3 million, accounting for only about 40% of imports. The large trade deficit was more than compensated for by transfers (US$108.0 million) and capital inflows (US$64.2 million). Exports declined by about 12% in 1977 mainly on account of bananas, the second most important export item. The drop in banana exports resulted partly from a marketing dispute in the Middle East. Decreased activity in fields such as fish and meat canning, formerly assisted by the Soviet Union, also contributed to declining exports. Livestock exports have stagnated during the past three years largely because of the 1974-75 drought, but early indications for 1978 suggest a resumption of growth (in volume) together with satisfactory price developments. 13. Slow growing exports and a low level of domestic savings, both attributable to the country's poverty, have made external assistance most important in the financing of development. Somalia joined the Arab League in 1974 and mounted a major effort to attract funds from the Arab petroleum exporting countries. The large inflows of external capital and transfers from 1975 onward indicate that the effort has been successful. Due to political events, the source of foreign assistance has recently changed from the socialist countries (except for China which maintains a large program) towards Arab bilateral and multilateral institutions (continuing the trend started in 1975) and Western countries, several of which (the EEC, FRG and Italy) have had substantial assistance programs for a number of years. The public external debt of Somalia outstanding and disbursed as of December 1977 was approximately US$399 million, and although a large share is on fairly soft terms, the debt service ratio has increased from 3.4% in 1972 to about 5.5% in 1977. 14. In summary, the Government's record over the past few years has been mixed, but the country's poverty is such that even partial successes must be commended. The slow development of agriculture in a mostly nomadic society, the shortage of qualified manpower, the difficulties of organizing and manag- ing an efficient public sector, and the limitation of financial resources  -5- can all be imputed to the country's limited endowment and to its human and natural constraints. The government has attempted and partially succeeded in alleviating some of these constraints. It has met some of the basic needs. It has also laid a national basis for growth in manufacturing together with an initial system of economic and physical infrastructure, though growth in income, exports, and imports has been rather slow. The Government may want, however, to consider adapting its development strategy to an economic: environ- ment that has changed over the last few years. 15. As regards future policies, greater emphasis should be given to economic growth; this would imply directing more investments towards produc- tive activities, particularly agriculture and small-scale industry. The mobilization of resources to this end should be sought through better manage- ment of public enterprises, a more useful role for the skills and resources acquired by migrants, and a broadened capacity to absorb external calpital. In addition, many observers suggest that the Government may be overextending itself. In the interest of economic growth, somewhat better opportunities and greater incentives ought to be given to private investors. 16. Somalia's export prospects are rather poor because of the concentra- tion on two primary products -- livestock and bananas -- both of which face problems in expanding production in the long run. Livestock is subject to cyclical droughts which decrease export supplies. Banana exports have fallen because of *both supply (drought, floods, poor agricultural practices) and demand (increasing competition from multinationals in both Italy and the Middle East) problems, but production could recuperate within two years. Diversification efforts have been attempted with hides, skins, and fisheries with limited success and even dimmer prospects now that Soviet technical assistance, dominant in these three activities, has been wound up. Therefore, in view of the country's poverty and uncertain export prospects, assistance should be provided on the softest terms possible and contain provisions for local currency financing. PART II - BANK GROUP OPERATIONS IN SOMALIA 1/ 17. Starting in 1965 IDA has made 17 Credits totalling about US$112 million, of which about 38% have been made for transportation develcpment, including construction of three trunk roads and a new deepwater port and associated extensions at Mogadishu. IDA Credits were also made for live- stock development in FY74, for a development finance company project in FY77, and for education in FY71, FY75 and FY78. Lending for agriculture commenced in FY76 with two Credits for a Drought Rehabilitation Proliect and a North-West Region Agricultural Development Project. A Credit for development of water supply in Mogadishu and a technical assistance Credit for project preparation were approved in FY78. No Bank loan or IFC invest- ment has been made to Somalia. Annex II contains a summary statement of IDA Credits as of March 31, 1979 and notes on the execution of ongoing projects. 1/ This section is the same as the Agricultural Extension and Traiining Project.  -6- 18. Performance on ongoing projects generally has been satisfactory. However, as the pace of development continues to rise, absorptive capacity constraints are becoming increasingly evident, especially in the field of agriculture where projects are rather complex and implementation experience is limited. Therefore, in preparing and appraising new projects, particularly close attention will have to be paid to implementation capacity and the adoption of measures to ease this constraint when necessary. To overcome the more pervasive problems of project implementation, which are common with the agriculture sector, the Government is establishing a Project Implementation Unit which would strengthen the capacity for project implementation consider- ably by providing monitoring and logistical support to the projects, including assistance in procurement and recruitment of consultants. 19. We plan to concentrate our future efforts on the country's directly productive sectors, agriculture and livestock, and also on education and transportation. While agriculture and livestock offer potential for develop- ment, most rural development activities are only at the beginning stage. Moreover, agricultural development in Somalia is particularly difficult because most of the people in rural areas are nomadic. For these reasons, we plan that much of our future lending will be in the agriculture and livestock sectors, and this will be complemented with near equal attention on education. We are seeking Board approval for an Agricultural Extension and Farm Management Training Project, and in the near future we intend to seek approval for an agricultural project for the Bay Region. We have also started to assist the Government in preparation of a National Livestock Marketing Project. In order to increase our knowledge of the agricultural sector, we plan to carry out a review of this important sector in the near future. In addition to these sectors, we plan to support the Government's industrial development efforts (and assist in the formulation of an industrial development policy) through our country economic work and future DFC projects. We also plan to continue assistance to the water supply sector. 20. Somalia's statistical service lacks the capacity to fulfill the data needs of development programs. The Bank's Operations have experienced difficulties in obtaining statistical data. It is proposed to strengthen the Central Statistical Department in the State Planning Commission under the Agri- cultural Extension and Farm Management Training Project through provision of technical assistance and training of Somali staff. 21. To facilitate the development and implementation of the Associa- tion's growing operational program in Somalia, we have established a one-man resident mission. The mission represents the Bank Group in its contacts with the Government thus facilitating an efficient and smooth day-to-day working relationship and assists in coordination of the cofinancing efforts.  -7- PART III - THE LIVESTOCK SUB-SECTOR 22. Livestock production is the most important industry of Soimalia. Over two-thirds of the population is engaged in transhumant grazing of live- stock in the rangelands. Livestock production contributes about 75-80% of total foreign exchange earnings through the export of live animals and animal proiducts. Over the three-year period 1974-76 an average of 1.5 million live animals were exported annually, of which 57% were sheep, 38% were goats while cattle and camels accounted for 3% and 2% respectively. Resource Base 23. The traditional livestock industry is based on natural rangelands which constitute 45% of the total land area (30 million ha.). This land is suitable only for extensive livestock production. The rainfall is erratic both with respect to distribution and timing. Most of Somalia is consequently classified as arid to semi-arid. In central Somalia, the vegetation consists mainly of sandy bush grasslands. On the average, droughts occur once every five years. This severely limits the productivity of rangelands. These rangelands are already under pressure and are forcing pastoralists to fall back on the scarce stockwater points. This results in overgrazing of vegeta- tion in the surrounding area. However, range vegetation has a remarkable resilience. Normal rainfall and reduction in grazing pressure would enable the rangelands to substantially resume their vigour. Resource Ultilization 24. The sole productive use of the rangelands is to graze livestock under a husbandry system flexible enough to adapt to the sparse and erratic rainfall. The Somali pastoralists have developed a system of production which minimizes the effects of drought and disease. They achieve the best possible grazing by dispersing their herds wisely. The pastoralists constantly attempt to make maximum use of natural grazing and expand their flocks through uncon- trolled breeding. The expansion of flocks is done in anticipation of the heavy losses which the next drought is bound to inflict. This traditional system has functioned as long as new grazing areas were available and feuds, drought and disease acted as a check on human and animal numbers. The enforce- ment of law and order and advances in human and veterinary medicine, together with first stages in the modernization of the economy, have, however, removed these constraints. The pastoralists are now compelled to compete with one another for the available forage and water. They have little regard to the needs of the vegetation for recuperation. Without the introduction of manage- ment of the rangelands and livestock, the forage resource would deteriorate and livestock numbers would decrease. This would result in a lower output of meat and milk which would have to be shared by an increasing population.  -8- Livestock Marketiing 25. Livesticbh is iiarketed mainly by private traders. Ihe producer is often at their merc,y because of the lack of competition in the market place and inadequate price information. The Livestock Development Agency (LDA), as the official aiarketiuig organization, provides only limited marketing services. It mostly acts as a fee collection agency. Further, the trekking of livestock over long distances causes losses from stress and disease. Sector Constraiki 26. Thle . isji patcernu of production and the impact of drought is becoming more pronouncled, The severe drought period, 1973-75, caused the loss of up to 30-40% of the animal population and forced 200,000 pastoralists into Government rel-x J campt. This was a clear indication of the breakdown of the traditional systt.,, of production and the increasing vulnerability of the pastoralist. Ghe Government is determined to bring education, health and extension seiviceb to the pastoralists who represent 80% of the Somali popu- lation. However it is a difficult task to achieve because of the fragmenta- tion and high idobiility of pastoral communities. Under present circumstances, the fragmentation and mobility of pastoralists is essential to the continua- tion of livestock prod.ction in the rangelands. A sedentarization of pastor- alists which was L,ot preceded by the introduction of range management would however, be detriniental to the livestock industry and might entail the loss of livelihood for possibly as much as half of the population. Related Goverime=iit; lisit.uttions 27. The htighiest l vel of decision making rests with the Central Commit- tee of the Somali Socialist Revolutionary Party. The Minister of Livestock, Forestry and Range (MLFR) reports to the Central Committee. The Minister interprets policy and makes operational decisions with regards to rangelands development and livestock. The Ministry of Livestock, Forestry and Range defines policy tor: (i) the National Range Agency (NRA); (ii) the Livestock Development Agelncy (LDA); (iii) the Veterinary Services; (iv) the Department of Animal Prodaction (DAP); and (v) the Institute of Animal Sciences. 28. The National Range Agency was established in 1976, as an autonomous agency to design and imaplement a national range development strategy. The Agency is authorized to: (i) plan national range development; (ii) establish grazing and drought reserves; (iii) develop fodder production units; (iv) carry out planned stockwater development; (v) promote organizations for guiding and educating livestock owners; and (vi) map the rangelands and classify rangeland areas. The transfer of the Forestry Department to this agency in 1977 further made the agency responsible for: (i) creation of forest reserves; (ii) con- trol of usage of disappearing plant species; and (iii) experimentation with forage or other plant species to achieve more efficient utilization. In 1978, the National Range Agency had a budget of So.Sh. 14 million for activi- ties other than those related to the Kuwait Fund financed Northern Rangelands Development Project. The NRA at present employs 300 permanent staff. The Livestock Development Agency, which was set up in 1960, has responsibility for livestock marketing and exports. The Department of Veterinary Services is under the Director of Veterinary Services. A Serum and Vaccine Institute  - 9 - operating under the Department produces vaccines. Animal production projects and related state-farms and education services are handled by the Department of Animal Production. Development Strategy 29. The Government's development strategy is: (i) to improve the resource base of the livestock industry through range management; (ii) alleviate the constraints on livestock productivity by providing better veterinary services; and (iii) to achieve a gradual concentration of pastoral communities so that their standard of living may be improved through the provision of health services and education. This can only be achieved with the cooperation of the pastoralists. Their cooperation will not be forthcoming unless they recognize the usefulness of the proposed range management system. This entails a strong emphasis on education, the establishment of grazing associations and their gradual assumption of responsibility for grazing control. In addition, the National Range Agency needs to be strengthened so that it may carry out its initiating, educational and supervisory role effectively. Bank Group Assistance in the Agricultural Sector 30. We have had limited experience in the field of agriculture in Somalia. Bank Group assistance to the agricultural sector in Somalia started with the Trans-Juba Livestock Project (IDA Credit 462-SO) in FY74 followed by two Credits in FY76, Drought Rehabilitation Project (IDA Credit 623-SO) and the Northwest Region Agricultural Development Project (IDA Credit 635-SO). In addition to the proposed Project and the Agricultural Extension and Farm Management Training Project, a Bay Region Agricultural Development Project is in the pipeline. As indicated in paragraph 19, the Bank has also started the preparation of a Livestock Marketing Project. 31. Experience with ongoing agricultural projects has indicated absorp- tive capacity difficulties mainly due to the scarcity of trained manpower in the agricultural sector. The scarcity of manpower has become more critical due to the continued exodus of Somalis to the neighboring petroleum exporting countries. In response to these problems, several steps have been taken to ease up implementation contraints. For example, the future projects are being designed with a large provision of technical assistance. Emphasis is placed on institution building by providing comprehensive training programs in the Projects. Moreover, the proposed Agricultural Extension and Farm Management Training Project would make an important contribution to institution building by training managers, administrators, and extension agents. The Livestock Marketing Project would deal with the organization of national livestock marketing service, which would be an important backup activity for the Trans- Juba Livestock Project, the Kuwait Fund financed Northern Rangelands Develop- ment Project, as well as for the proposed Project. The design of the proposed Fourth Education Project would also emphasize manpower development both for the short-term by training specialists, as well as for the long-term by improv- ing the quality of education. To overcome the more immediate administrative and technical problems of project implementation which are common in the agri- cultural sector such as hiring of consultants, procurement of equipment and  - 10 - monitoring of project implementation, a Project Implementation Unit is being set up in the State Planning Commission by the Government, which would strengthen the capacity for project implementation considerably. PART IV - THE PROJECT Background 32. A report entitled "Staff Appraisal Report, Central Rangelands Development Project" (No. 2163-SO) dated April 12, 1979 is being distri- buted separately. A Credit and Project Summary appears at the beginning of this report and a Supplementary Project Data Sheet is given in Annex III. 33. A UNDP/FAO Livestock Development Survey was conducted in 1966. This was followed by a survey of the Northern Rangelands (UNDP) in 1970 and by the Rangeland Conservation and Development Project in 1972. In 1976 the Government decided to establish the National Range Agency (NRA) initially to implement the Northern Rangelands Development Project (NRDP) appraised by IDA in 1975 and subsequently financed by the Kuwait Fund. Following World Bank identification, a Project to develop the Central Rangelands area of the coun- try was prepared by a joint Government/World Bank (RMEA) team. The prepara- tion was completed in October 1977. The Project was appraised in February 1978. Negotiations were held in Washington, D.C. from March 15, 1979 to March 19, 1979. The Somali Delegation was headed by Mr. Ahmed Mohamed Mohamud, the Chairman of National Economic Committee. Project Objective 34. The Project is designed to assist the Government in: (i) improving rangeland and livestock productivity through the introduction of range manage- ment, livestock water supplies and improved veterinary services; (ii) gaining the confidence and cooperation of the pastoralists by establishing a dialogue with them through non-formal training; and (iii) improving NRA's ability to implement range development by training of staff at all levels and by provid- ing internationally recruited senior technical staff. Project Description 35. The Project would, over a period of six years, consolidate and improve rangeland and livestock production in the project area, increase the income of the pastoralists through the introduction of a system of range utilization, and make way for the gradual concentration of pastoral communi- ties, which would help in the provision of social services. This would be achieved by conducting an aerial survey of the rangelands, including livestock and human habitation, and the preparation of a vegetation map. This would be followed by a ground survey of the rangelands and the pastoral communities. This survey would form the basis for the establishment of grazing reserves and selection of those reserves where stockwater supplies would be developed. The Veterinary Services would be expanded, non-formal and formal education would be provided. The National Range Agency's administration would be  - 11 - strengthened, and nurseries, town shelter belts and water and soil conserva- tion activities would be initiated. Specifically, the Project would provide staff, equipment, housing and transport to carry out: (i) range development comprising a range ground survey, the demarcation of 45 town and village grazing reserves, 12 famine reserves and 20 range grazing reserves; the drilling and equipment of 32 boreholes or surface water ponds to provide supervised stockwater points in the famine and range grazing reserves; the construction of 1,000 km of access tracks and the provision of staff housing, offices and workshops as well as transport and equipment for the National Range Agency field service in the project area; (ii) non-formal training comprising: a survey of pastoral com- munities to establish a dialogue and collect information, on seasonal movements and grazing; non-formal education on the objectives of the Project; the formation of grazing associa- tions; field training for the upgrading of field staff and the initial on-the-job training of range assistants; the production of simple educational materials directed at the pastoralists and a film on the pastoral way of life explain- ing the purpose of the Project; (iii) formal training comprising the provision of 4 lecturers for training courses in animal production, range and forestry at the technical level and 1 university lecturer in range management 'or the Faculty of Agriculture at Afgoi; 20 man-years of post-graduate fellowships in range management; and overseas on-the-job training of counterpart staff for the range monitoring team; (iv) rangeland studies and trials comprising 5 man-years of professional services for the establishment of range refer- ence areas to observe the effects of grazing systems, range improvement experiments (firing, bush clearing) and forage analysis; 3.5 man-years of professional services to continue the identification and registration of range vegetation (taxonomy); funding for an aerial survey and vegetation mapping of the Tugder, Nugal and Sanag regions in Northern Somalia; demonstration of soil and water conservation measures, experiments with and the evaluation of grazing cooperatives; strengthening of the NRA's forestry department, and establishment of three town shelter belts and three forestry/range nurseries; (v) the strengthening of Veterinary Services comprising 16 man-years of professional services; 6 mobile vaccination teams and 12 mobile clinics in order to provide year round services;  - 12 - (vi) the strengthening of National Range Agency headquarters comprising 15.5 man-years of professional services to strengthen senior technical management; 4 man-years of professional services to establish a range monitoring unit for continuous monitoring of the range reserves; 6.5 man- years of professional services to set up a stock-water service to develop, operate and maintain stockwater supplies; 4 man-years of professional services to establish one central and three regional workshops to ensure the main- tenance of vehicles, water pumps and engines; and funds for the construction of a head quarters building. A total of 4,700 man-years of unskilled labor required for surveying and demarcation of range reserves, the establishment of town shelter belts and nurseries, soil conservation and water spreading and experimental grazing cooperatives would be provided under a World Food Program Project. Project Implementation 36. The National Range Agency would be the executing agency for the Project. However, the Veterinary Services component would be executed by the Veterinary Department. The formal training at the Livestock and Range School at Afgoi would be the responsibility of the Project Management Unit of the Ministry of Education, and the training in range management would be the responsibility of the Faculty of Agriculture of the National University of Somalia. The General Manager of the National Range Agency would be the Project Manager. He would be assisted by an internationally recruited Project Coordinator with qualifications, experience and terms and conditions satis- factory to the AssociaLion; this appointment would be an additional condition of effectiveness (Development Credit Agreement, Sections 4.02(c) and 6.01(c)). The Project Coordinator would supervise and coordinate the implementation of various project components. He would be working through the responsible departments which would be strengthened by internationally recruited technical directors. 37. A new law for the development of range management has been signed, but not yet enacted and gazetted. This law authorizes the Minister of Live- stock, Forestry and Range, on the recommendation of the National Range Agency, to establish range development and conservation areas and gives the Agency additional authority regarding rangelands management. It would be a condition of Credit effectiveness that the law for the development of range management had been enacted and gazetted (Development Credit Agreement, Section 6.01(e)). Staff and Training 38. In all, the Project would provide 100 man-years of internationally recruited staff who would be distributed over 30 posts at various stages of project implementation during a six-year period. At present Somalia has only one degree holding range management officer. A total of 15 graduates from the Faculty of Agriculture would be sent to the United States for a two-year post-graduate course in range management. The funding for the first group of four students is provided for under the Project Preparation Facility. The expenses from year two onward would be financed by USAID under a regional  - 13 - manpower development program. The Livestock and Range School at Afgoi would graduate 30-40 Range Assistants annually from year five of the Project. The Project would provide four lecturers for this school. In the meantime, on-the-job training of range assistants would be carried out in the field under the non-formal training component of the Project. The training courses are intended to enable the Somalis to take over full responsibility upon departure of the technical assistance staff. Annual Work Program and Project Review 39. A detailed annual work program and budget for project implementation would be prepared by the National Range Agency and would be furnished to IDA for review by November 15 of each year, starting in 1979 until 1984 (Project Agreement, Section 2.07). This would ensure that necessary provisions for project implementation are included in the Agency's budget and the relevant staff are in place or being recruited, and that the program complies with project criteria and conditions. Monitoring and Evaluation 40. A Monitoring and Evaluation Unit would be established under the planning service of the Research Training and Planning Department of the National Range Agency. The Unit would initially be staffed by one profes- sional staff. The International Livestock Center for Africa (ILCA) has agreed to provide technical assistance for establishing a monitoring package, with particular emphasis on establishing an appropriate methodology. Project Co2t Estimates 41. Project costs would amount to US$46.3 million over the six-year implementation period. The foreign exchange component amounts to US$32.7 million or 71% of total cost. The Project cost estimates are summarized below. Foreign Project Component Local Cost Foreign Cost Total Cost Exchange --