Romania - Mostistea and Calmatui Irrigation and Drainage Project

Document of IOM D1 The World Bank FOR OFFICIAL USE ONLY Report No. P-2481-RO REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE BANK FOR AGRICULTURE AND FOOD INDUSTRY WITH THE GUARANTEE OF THE SOCIALIST REPUBLIC OF ROMANIA FOR A MOSTISTEA AND CALMATUI IRRIGATION AND DRAINAGE PROJECT March 6, 1979 This document has a restricted diiution ad may be med 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 : Leu (plural Lei) 1. Official Rate Lei 4.47 = US$1.00 Leu 1.00 = US$0.22 2. Tourist Rate Lei 12.00 = US$1.00 Leu 1.00 = us$0.08 3. Conversion Rate for Traded Goods Lei 18.00 = us$1.00 Leu 1.00 = US$0.06 The Official Exchange Rate of lei 4.47 per US$1 is used only for accounting purposes. The rate used for tourist transactions is lei 12 per US$1, having been revalued from a rate of lei 14.38 per US$1 in October 1974. Beginning in March 1978, a trading rate of lei 18 per US$1 has been used to convert the prices of all traded goods; this rate is considered representative of the average cost of convertible foreign exchange. Fiscal Year January 1 to December 31 GLOSSARY OF ABBREVIATIONS BAFI - Bank for Agriculture and Food Industry CAP - Agricultural Production Cooperatives IAS - State Agricultural Enterprise NWC - National Water Council SMA - Station for Agricultural Machinery.  FOR OFFICIAL USE ONLY ROMANIA MOSTISTEA AND CALMATUI IRRIGATION AND DRAINAGE PROJECT Loan and Project Summary Borrower: Bank for Agriculture and Food Industry (BAFI) Guarantor: Socialist Republic of Romania Beneficiary: State enterprises and cooperative complexes Loan Amount: $70.0 million Terms: Repayable in 15 years, including 3 years grace period, through semi-annual installments. Interest at 7 percent per annum. Relending Terms: The loans from BAFI to Agricultural Production Coopera- tives (CAP) for buried pipelines would be for 25 years including 5 years' grace and for on-farm sprinkler equip- ment, 8 years including 3 years' grace. The interest rate would be 3 percent with penalty rates of up to 5 percent. The Government would bear the foreign exchange risk. Description of the Project: The project consists of two separate and distinct components: Mostistea: Irrigation and drainage of 158,540 ha gross (155,871 ha net) would be achieved through completion of following works: widening of existing supply canal from the Danube including extension of an existing floating pumping station, construction of four low pumped storage dams on Mostistea River; installation of eight fixed pumping stations and six repumping stations for feeding the new irrigation systems; surface drainage for 82,683 ha; tile drainage for 4,238 ha; soil erosion con- trol works to protect an area of 13,344 ha; and equipment for maintenance and operation and for farming operations. Calmatui: Drainage of 66,930 ha gross (64,527 ha net) and irrigation of about one-third of this area would be accomplished through following works: Extension of existing floating pumping station; irrigation works to serve 23,980 ha gross (23,000 ha net); surface drainage works to serve 66,930 ha; subsurface drainage works for 14,455 ha; reclamation of saline soils covering 9,200 ha; and equipment for operation and maintenance of irri- gation and drainage works and for farming operations. 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.  - ii - Benefits and Risks: The project would contribute to Romania's overall effort to increase and stabilize agricultural production through investment and related farm development. The project faces no special risks. Estimated Cost: Estimated Cost Foreign Local Foreign Total Exchange Item -------US$ Million------ % Pumps Reservoirs and Irrigation Works 136.9 61.8 198.7 31 Drainage 33.4 8.2 41.6 20 Miscellaneous Works 16.8 3.0 19.8 15 Land Compensation 35.6 - 35.6 - Equipment 23.0 13.6 36.6 37 Engineering and Administration 19.8 2.2 22.0 10 Physical Contingencies 17.7 6.3 24.0 26 Price Contingencies 8.9 22.0 30.9 72 Total Cost 292.1 117.1 409.2 /1 29 Financing Plan: Local Foreign Total -----