Announcement of World Bank Supports Rural Development and Small and Medium-Scale Enterprise Projects in Cameroon on November 20, 1980

FORIJIMMEDIA TE RELEASE World Bank 1818 H Street, N.W., Washington, D.C 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 81/26 IDA NEWS RELEASE NO. 81/17 November 20, 1980 WORLD BANK SUPPORTS RURAL DEVELOPMENT AND SMALL- AND MEDIUM-SCALE ENTERPRISE PROJECTS IN CAMEROON Two development projects in Cameroon--one to assist rural development in Cameroon's Northern Province and the other to promote Cameroonian enterprises--will be implemented with the support of two World Bank loans totaling $40 million and a credit from the International Development Association (IDA) of SDR 9.5 million ($12.5 mil 1 ion). IDA is the soft-loan affiliate of the Worid Bank. The rural development project will be supported by a Bank loan of $25 million and the IDA credit. The Bank loan has a term of 20 years, including five years of grace, with interest at 9.25% per annum. The IDA credit is for 50 years, including 10 years of grace. There is no interest, but 3/4 of 1% is being charged to cover administrative expenses. The small- and medium-scale enterprise project is being supported by a Bank loan of $15 million. It has a term of 15 years, including three years of grace, • with interest at an annual rate of 9.25%. Rural Development With an estimated total cost of $74.7 million, the rural development project will include activities affecting both Northern Province as a whole and a project area in the Center-North of the province. The project is designed to improve ~gricultural production and farm incomes in the Center-North area by the provision of improved rural infrastructure--roads, and storage and marketplace facilit!es--and effective services, including input supply, supervised credit for the purchase of draft animals and equipment, extension and training, marketing, and adaptive research. The principal executing agency, Societe de Developpement du Coton du Cameroun, will be provided with financial and technical assistance to extend its responsibilities for a wider range of rural development activities. The project is also expected to improve the effectiveness of existing administrative structures in the Northern Province in the planning, coordination, and control of development projects. IDA credits are denominated in S0Rs (Special Drawing Rights), which are va1ued on the basis of a "basket" of currencies. The U.S. dollar equivalent on the SDR amount of the IDA credit reflects the exchange rates existing at the time of negotiation of the credit. I I • • • •  - 2 - About 163,000 farm families are expected to benefit from the project. More ~ than half of these families are not now reached by extension services and are in the absolute poverty group. Important indirect benefits are also expected to flow from the strengthening of institutions in the Northern Province responsible for agricultural and rural development activities. The Government of Cameroon will contribute $27.5 mill ion towards thf cost of the project. Participating farmers will contribute $9.3 million and ~he Fonds National de Developpement Rural, $400,000. The Food and Agriculture Organization of the United Nations (FAO) joined the World Bank in identifying and preparing the project under the Bank/FAQ Cooperative Programme. Artisans and Small- and Medium-Scale Enterprise This project, with an estimated total cost of $21.2 mill ion, is in line with the government 1 s objectives of promoting Cameroonian enterprises, generating employment, and encouraging a better geographical distribution of industrial activity in the country. The project, which includes an institution-building component, will provide credit for artisans and small- and medium-scale enterprise projects. Banque Camerounaise de Developpement, B.P. 55, Yaounde, United Republic of Cameroon, will be the implementing agency and wi 11 itself benefit from the tech- ~ nical assistance which is being financed by the loan. A pilot program for artisans will be initiated by Centre National d'Assistance aux Petites et Moyennes Entreprises which will receive a grant for technical assistance. The project wil 1 be implemented over a four-year period and is expected to generate additional direct employment for about 1,800 persons. An earlier project for assisting small- and medium-scale enterprises, which received an IDA credit of $3 mi 1 lion in 1975, is nearing completion. 0 • FORM NO. 1121 (5-76) T E C HN I CA L DA TA • PROJECT: Northern Province Rural Development COUNTRY: United Republic of Cameroon TOTAL COST: $74.7 million BANK FINANCING: $25 mill ion for 20 years, including 5 years of grace, at an annual interest rate of 9.25% IDA FINANCING: SOR 9.5 mi 11 ion ($12.5 mi 11 ion), standard I DA terms OTHER FINANCING: Government of Cameroon, $27.5 mill ion; beneficiaries, $9.3 mill ion; Fonds National de Developpement Rural, $0.4 mill ion IMPLEMENTING ORGANIZATION: SODECOTON (Societe de Developpement du Coton du Cameroun) B.P. 302 Garoua, United Republic of Cameroon Telex: 7617 KN PROJECT DESCRIPTION: The project will: (a) improve agricultural producticn and farm incomes in the Center-North area of Cameroon's Northern Province by providing: (i) improved rural infrastructure, including roads, storage and marketplace facilities; and (ii) effective services, including input supply, supervised credit for purchase of draft animals and equipment, extension • and training, marketing, and adaptive research; (b) provide the principal executing agency with financial and technical assistance to extend its responsibll ities for a wider range of rural development activities; and (c) improve the effectiveness of existing administrative structures in Northern Province in the planning, coordination and control of development projects, including monitoring and evaluation and agricultural research. PROCUREMENT: Contracts for goods estimated to cost $100,000 or more (vehicles,road-making and agricultural equipment-- about $6.7 mill ion) will be awarded through international competitive bidding in accordance with Bank guidelines. Purchases will be grouped whenever possible in order to derive maximum benefits from bulk procurement. Contracts for construction of staff housing ($3.7 million) and of storage facilities ($2.7 mill ion) will be too smal 1 and geograph- ically dispersed to attract international bidders and will be awarded following locally advertised competitive bidding procedures acceptable to the Bank. Contracts for goods below $100,000 but more than $50,000 wil 1 be procured through local competitive bidding procedures, while those of less than $50,000 will be on the basis of quotations from not fewer than three reputable suppliers. CONSULTANTS: Technical specialists services will be obtained in accordance with procedures acceptable to the Bank . • ECONOMIC RATE OF RETURN: 34% ESTIMATED COMPLETION DATE: 1986 - 0 -