Announcement of IDA Provides Forty-Three Million Dollars Credit to Tanzania for a Grain Storage and Milling Project on May 8, 1980

FOR IMMEDIATE RELEASE •World Bank 1818 H Street, N.W. 1 Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 IDA NEWS RELEASE NO. 80/62 May 8, 1980 IDA PROVIDES $43 MILLION CREDIT TO TANZANIA FOR A GRAIN STORAGE AND MILLING PROJECT The International Development Association (IDA), the World Bank's affiliate for concessionary lending, has approved a $43 million credit for a grain storage and milling project in Tanzania. The project, the total cost of which is $58.4 million, is aimed at improving the capacity of the N~tional Milling Corporation to procure, transport, store, and mill foodcrops. It will finance the rehabilitation of 40% of the corporation's godowns and all existing silos. _Additional storage facilities will be constructed and materials for open storage will be obtained. Pilot programs for controlled open storage and dryers will be implemented. • In addition, the maize milling capacity of the Dar-es-Salaam mill will be expanded, a new mill will be constructed at Dodoma, and existing mills will be reha- bilitated. Provision is also made for the creation of one central and four satellite laboratories for the analysis of grain and flour from the mills. Technical assistance, additional staff,and training for all levels of the National Milling Corporation's staff will be provided to improve its institutional capabilities. The Marketing Development Bureau and the Project Preparation and Monitoring Bureau in the Ministry of Agriculture will be supported to ensure their continued involvement in policy analysis of Tanzania's agricultural sector. By improving the capacity of the corporation to handle, store, and mill food- crops, the project will help to reduce crop losses from storage and will thus make larger quantities of foodcrops available for domestic consumption and export. By 1985/86, the quantities thus saved are estimated at 6%, 12%, and 15% of the total estimated production of maize, rice, and wheat, respectively. Benefits will accrue to both producers and consumers of crops marketed by the corporation from improved market- ing services and from reduced margins expected between producer and consumer prices. The $43 million IDA credit to Tanzania is for 50 years, including a grace period of 10 years. It will carry no interest but a 3/4 of 1% service charge per annum to cover IDA's administrative costs . • NOTE: Money figures are expressed in U.S. dollar equivalents. FORM NO. 1121 (5-76) T ECHN I CA L DAT A •• PROJECT: COUNTRY: TOTAL COST: Grain Storage and Milling Tanzania $58.4 miflion • lDA FINANCING: $43 million, standard IDA terms OTHER FlNANCING: Government of Tanzania, $15.4 million IMPLEMENTING ORGANIZATION: National Milling Corporation (for storage and milling) P.O. Box 9502 Dar-es-Salaam, Tanzania Cable: CHAKULA, Dar-es-Salaam Ministry of Agriculture (for investment in Marketing Develop- P.O. Box 9192 ment Bureau and Project Preparation Dar-es-Salaam and Monitoring Bureau) Cable: KILIMO, Dar-es-Salaam PROJECT DESCRIPTION: It aims to improve the capacity of the National Milling Corporation (NMC) to procure, transport, store, and mill foodcrops. It includes the rehabilitation of 40% of NMC's existing godowns and all its existing silos; the construction of 40,000-50,000 metric tons (MT) of additional storage ;apacity; the financing of tarpaulins and polythene sheets for open storage; the implementation of pilot programs involving controlled open storage and dryers; the expansion of maize milling capacity by the extension of the Dar-es-Salaam mill by 70 MT/day, and construction of a new mill at Dodoma with a capacity of 120 MT/day; the • rehabilitation of existing mills; a central laboratory and satellites for grain and flour analysis; transport for NMC; training for NMC staff at all levels; and technical assistance, incremental staff, and consultants' services to NMC. Financing will also be provided for the Marketing Development Bureau and the Project Preparation and Monitoring Bureau in the Ministry of Agriculture in order to ensure their continued involvement in policy analysis in the agriculture sector in Tanzania. PROCUREMENT: Vehicles, spare parts, and equipment financed under the project will be bulked as far as possible and orders of $100,000 equivalent and above will be procured on the basis of international competitive bidding (ICB) in accordance with Bank/lDA guidelines. Construction of new closed flat storage facilities, the new mill, the mill extension, silo rehabilitation, and houses will be bulked as far as possible, and contracts of $500,000 and above will be procured on the basis of I CB in accordance with Bank/ I DA guide 1 i nes. In the eva 1uat ion of bids, qualified domestic contractors and manufacturers will be allowed a preference of 7-1/2%, and 15%, respectively over the c. i .f. price of imported goods or the prevailing rate of duty, whichever is lower. Procurement of goods and equipment which can not be bulked in orders of $100,000 equivalent or more, and construction of new stores and milling facilities, rehabilitation of silo facilities, and housing at a cost of less than $500,000 equivalent, will be in accordance with the borrower's competitive bidding procedures which are acceptable to IDA. Civil works contracts for training facilities, pilot open storage plynths, laboratories, office buildings, and closed s~orage rehabilita- tion will be too $mall and scattered to attract international interest and procurement will therefore be by contracts awarded following locally advertised competitive bidding; foreign firms will be entitled to compete. The detailed designs for the new storage • facilities, mills, and central laboratory will be submitted to IDA prior to the solicita tion of construction. . ./  2 • CONSULTANTS: A number of experts will be needed by the National Milling Corporation, including a senior storage and grain handling advisor, silo specialist, fumigation and quality control specialist, planning and management advisor, and chief accountant, among others. Short-term consultants will be needed to provide technical assistance on specific matters, e.g., a milling technolo- gist, a workshop maintenance engineer, and a management information specialist. ECONOMIC RATE OF RETURN: 38% ESTIMATED COMPLETION DATE: 1986 • •