Jordan - Zarqa - Ruseifa Water Supply and Sewerage Project

Document of The World Bank FOR OFFICIAL USE ONLY FILE COh' Report No. P-3399-JO REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN IN AN AMOUNT EQUIVALENT TO US$17 MILLION TO THE HASHEMITE KINGDOM OF JORDAN FOR A ZARQA/RUSEIFA WATER SUPPLY AND SEWERAGE PROJECT October 26, 1982 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 Calendar 1981 May 1982 Currency Unit Jordan dinar (JD) JD US $1.00 JD 0.33 JD 0.35 JD 1.00 US$3.06 US$2.89 Exchange rate used in the Appraisal Report JD1=US$2.89 Fiscal Year = Calendar Year ABBREVIATIONS AND ACRONYMS AWSA = Amman Water and Sewerage Authority IDB = Islamic Development Bank JVA = Jordan Valley Authority KfW = Kreditanstalt fur Wiederaufbau NPC = National Planning Council NRA = Natural Resources Authority USAID = U.S. Agency for International Development WSC = Water Supply Corporation  FOR OFFICIAL USE ONLY HASHEMITE KINGDOM OF JORDAN ZARQA/RUSEIFA WATER SUPPLY AND SEWERAGE PROJECT Loan and Project Summary Borrower. The Hashemite Kingdom of Jordan Beneficiary: Water Supply Corporation (WSC) Amount: US$17 million equivalent Terms: 17 years, including four years of grace at the standard variable interest rate. Relending Terms: 17 years, including five years of grace, at a fixed interest rate substantially in line with that of the proposed loan. WSC would bear the foreign exchange risk. Project Description: The project would improve water supply and sewerage services as well as stormwater drainage in the cities of Zarqa and Ruseifa and contribute to the institutional development of the Water Supply Corporation. It would include: (i) construction of about 133 km of trunk and distribution water mains and supply of meters; (ii) construction of about 364 km of trunk and other sewers and force main, 30,000 house laterals, a sewage pumping station and a treatment plant; (iii) construction of about 14 km of stormwater culverts; (iv) construction of a maintenance workshop and provision of vehicles and equipment for operations; and (v) consultant services for supervising and start-up, developing an accounting system, carrying out a tariff study, assisting an organizational study as well as training WSC staff. The main beneficiaries of the project would be the inhabitants of Zarqa and Ruseifa, mostly low and middle-income families. The Water Supply Corporation (executing agency) does not have experience with large sewerage systems. There is, therefore, a risk of delay in construction of the sewerage component and adequate operation of the sewage treatment plant. Training and technical assistance are included in the project, and a special monitoring system has been prepared, to minimize this risk. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  - ii - Estimated Cost: Local Foreign Total ----$ Milion------- Water Supply 3.2 7.0 10.2 Sewerage Network and Treatment Plant 22.5 27.0 49.5 Storm Drainage 1.7 1.8 3.5 Consultant Services for Supervision, Training, Management, and Tariff Study; Fellowships 2.5 3.9 6.4 Base Cost 29.9 39.7 69.6 Physical Contingencies 3.8 6.0 9.8 Price Contingencies 4.7 7.0 11.7 Total Cost 38.4 52.7 91.1 Interest During Construction 4.1 8.4 12.5 Total Financing Required 42.5 61.1 103.6 Financing Plan: Government of Jordan (equity) 26.5 3.4 29.9 Proposed World Bank Loan - 17.0 17.0 U.S. Agency for International Development 1.0 14.C 15.0 Kreditanstalt fur Wiederaufbau 3.9 10.5 14.4 Islamic Development Bank - 7.8 7.8 Customers' Contributions 7.0 - 7.0 Total 38.4 52.7 91.1 Government (For Interest and Other Ctharges During Construction) 4.1 8.4 12.5 Total Financing 42.5 61.1 103.6  - iii - Estimated Disbursements: Bank FY 1984 1985 1986 1987 1988 1989 ~-~-------------- Million-------------------- Annual 0.4 3.8 4.7 3.8 2.6 1.7 Cumulative 0.4 4.2 8.9 12.7 15.3 L7.0 Rate of Return: Not Applicable Staff Appraisal Report: No. 4049-JO, dated October 5, 1982 Maps: No. IBRD 16424 - Sewerage and Stormwater Drainage No. IBRD 16425 - Water Supply Distribution System  I  INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE IBRD TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE HASHEMITE KINGDOM OF JORDAN FOR A ZARQA/RUSEIFA lATER SUPPLY AND SEWERAGE PROJECT 1. I submit the following report and recommendation on a proposed Bank loan to the Hashemite Kingdom of Jordan of US$17 million equivalent to help finance a Zarqa/Ruseifa Water Supply and Sewerage Project. The loan would have a term of 17 years, including 4 years of grace, at the standard variable interest rate. The Government would onlend the proceeds of the loan to the Water Supply Corporation (WSC) for a 17-year period, including 5 years of grace, at a fixed interest rate substantially in line with that of the proposed Bank loan. The United States Agency for International Development (USAID), Kreditanstalt fur Wiederaufbau (KfW) and the Islamic Development Bank (IDB) would participate in the project financing. The balance would be provided by the Government of Jordan and customers' contributions. PART I - THE ECONOMY 1/ 2. A report entitled "Country Economic Memorandum on Jordan" (No. 3135-JO, dated December 24, 1980) was distributed to the Executive Directors in January 1981. An economic mission visited the country in October 1981. Country data sheets are attached as Annex 1. 3. Jordan is a country of 2.2 million people (East Bank) with limited natural resources and a traditionally service and trade-oriented economy. It has enjoyed a high rate of growth and made good progress in diversifying commodity production, increasing investment, and promoting exports. This economic performance has taken place in the context of increasing trade with neighboring countries and expanding inflow of remittances from Jordanians working abroad, foreign aid and capital. As a result, employment is high and foreign exchange reserves have been steadily rising. Recent Economic Developments 4. Renewed stability following the disruptions of 1967-71 created a climate conducive to sustained economic growth during 1975-80, resulting in an average annual growth of GDP of about 12 percent in real terms. This growth was in sharp contrast with that during 1971-75, which was slightly negative. In 1980, GNP per capita reached $1,420. The upsurge of the economy was due to: (a) the rapid growth of the mining and manufacturing sectors; (b) the sharp increase in construction, particularly in housing and large public works; and (c) favorable external factors including influx of Lebanese 1/ Substantially unchanged from Part I of the President's Report for the Fifth Power Loan which was distributed to the Executive Directors on May 6, 1982.  -2- business activity and booming conditions in the Gulf countries. In agriculture, rainfed production was sharply reduced by a severe four-year drought, but vegetable and fruit production in the irrigated areas increased significantly. Agricultural output recovered sharply in 1980. The private sector showed growing strength especially in promoting export-oriented venture s. 5. The overall balance of payments remains strong despite a chronic deficit in merchandise trade. Exports of goods and non-factor services increased by 30 percent annually from 1975 to 1980 (about 24 percent in 1975 prices). This growth was due to high demand and prices for fruits and vegetables in neighboring countries, booming exports of rnanufactured goods and a sharp increase in receipts from tourism and other non-factor services. Jordanian goods have been able to compete successfully in Middle East markets because of the advantages of Arab Common Market and bilateral agreements, relatively good quality of the products, enterprising marketing and the favorable geographical location. Although the growth in the volume of imports was slower than that of exports, the resource gap increased in current terms from $560 million in 1975 to about $1,650 million in 1980. These trade deficits, however, were fully compensated by factor income and transfers from abroad. As a result, the Government-guaranteed external borrowing remained within reasonable limits and borrowing on commercial terms was reduced to a modest level (para. 15). 6. Expenditure and domestic revenue of the Government both increased at a rate of about 20 percent per annum through 1975-80. The widening of the overall budget deficit, however, was tempered by a sharp increase in grants from Arab countries following the Baghdad Summit Conference in 1978. As a result, the relative size of the deficit increased from six percent of GNP in 1975 to seven percent in 1980. The expansion of domestic Government revenue during that period was significantly below the overall rate of growth in national income. As a result, the ratio of Government domestic revenue to GNP declined from 24 percent in 1975 to 21 percent in 1980. Current expenditures, excluding defense, were covered by domestic revenues. Defense expenditures were largely financed by foreign assistance. During 1976I-80, about 36 percent of capital expenditures were financed from the current budget surplus, 33 percent by foreign loans, and the rest by other domestic resources. 7. The main concerns of monetary policy have been mobiLizing savings and controlling domestic liquidity. While the savings performance has improved, gross domestic savings have continued to be negative because of the high level of defense expenditures. Although the share of foreign grants used for military imports is not clearly delineated, assuming that at least 60 percent of net foreign transfers were used for military imports and were therefore excluded, gross domestic savings would be positive. To promote domestic savings, greater discretion is being allowed to the Central Bank in adjusting interest rates and banking commissions. Increases in deposit rates were effected and have resulted in savings deposits increasing faster than money supply. Between 1975 and 1980, domestic inflation, measured by the cost of living index, increased by 11.5 percent annually.  -3- 8. A diversified banking system capable of meeting the financial requirements of fast economic growth was developed during the last decade. The banking system now includes 15 commercial banks and 8 specialized credit and investment institutions. The Amman Stock Exchange, established in 1978, has become an active institution, and the Securities Corporation, created with IFC assistance, is growing in strength. The liberal transfer policy recently followed by the Central Bank has encouraged growth of the financial system, and Amman has started to emerge as an international financial center. Medium-Term Prospects 9. The new Five-Year Plan (1981-85) aims at maintaining the rate of growth of the economy close to that achieved during the previous plan. In terms of the investment program, the plan is ambitious--total investment would amount to JD 3.3 billion (1l1 billion), 53 percent of which is by the Government. The announced strategy is to pursue the objectives of the last decade of economic planning in Jordan, namely to: (a) reduce the heavy dependence on external assistance; (b) diversify the economy by increasing commodity production; (c) reduce the budget deficit; and (d) improve the distribution of the benefits of growth. 10. Medium-term economic projections indicate that rapid GDP growth, about 10 percent annually, can be maintained during the current Plan period. Because of an expected slowdown in factor income from abroad, GNP is projected to grow at a slightly lower rate of 8.5 percent per year. However, full implementation of the Plan's investment program is a key assumption underlying these growth rates. The program would maintain the rate of fixed investment at its high current level of 33-35 percent of GNP (in 1980 prices) and would seriously tax available technical and managerial skills in the country. Industrial growth will benefit from the completion of the major projects now under implementation (phosphate mining, cement, potash, and fertilizer) and would maintain an overall average annual rate of about 17 percent, peaking in 1983 and 1984. Barring serious disruptions in agricultural output through unfavorable weather conditions, Jordan would realize a significant increase in the share of commodity producing sectors in total domestic output and thus correspondingly reduce its traditional dependence on the services sector. 11. The medium-term prospects for increasing exports are promising. The completion of the major export-oriented industrial projects now under implementation, together with the enterprise displayed by the private sector, should result in significant increases in foreign exchange earnings after 1982. In agriculture, the expected increase in vegetable and fruit exports will, however, be more than offset by growing imports of food, and the agricultural trade deficit would probably increase. Even though total exports are projected to maintain a high rate of increase (16 percent p.a. at constant prices) while imports would grow at a significantly lower rate, the trade deficit could continue to increase and could exceed the two billion dollar mark by 1985. In relation to GNP, however, the resource gap is expected to show a significant further decline (from 46% to 40%). Unlike the recent experience, net workers' remittances and foreign grants may not be sufficient to meet the growing trade deficit. Jordan would therefore have to rely more heavily on external borrowing (para. 16).  -4- 12. Savings from private sources, particularly from workers abroad, should continue to increase, helped by the expanding banking net:work. A reduction of the budget deficit could also be expected. A working group is at present preparing recommendations on the fiscal system, but a raEdical structural reform can only be expected in the medium term. Although current expenditure, excluding defense, is expected to grow at a slower pace than the economy, the demands for increased social expenditure and the need to raise wages to retain valuable public servants will not permit significant cuts in current expenditure, except for subsidies for energy and food products. Social Issues 13. Due to the continuing migration of Jordanians to neighbDoring countries and the rapid economic growth, selective manpower shortages have emerged. In 1980, out of the approximately 800,000 Jordanians (including Palestinians from the West Bank) residing abroad, a little over 200,000 were estimated to be workers, compared to a total domestic employmen- of about 440,000. Domestic employment includes a rapidly growing numbe-. of foreign workers currently estimated at about 80,000 about half of whom are unskilled. The country has expanded its education and training system rapidlly but still needs a comprehensive manpower and training plan to help ensure that. (a) the economy does not suffer from shortages of crucial skills, while meeting prospective demand for skilled workers abroad as far as possible; and (b) the potential labor force is utilized more fully--especially the seasonally idle workers in rainfed areas and women, whose participation, although growing fast, is still low. 14. Social issues are now an acknowledged concern of the Government and this new emphasis is to some extent reflected in the new National Plan (1981-85). Although the social indicators provide a relatively favorable reading in most sectors, the social services are unevenly distributed across income groups and across provinces. Thus, while health i'nfrastructure is adequate and life expectancy is relatively high (61 years), medical doctors are concentrated in urban centers. Housing remains a problem despite the boom in 1978-80, mainly because housing costs have far exceeded the means of the lower income groups. The Government's concern about these issues has led to the setting up of the new Ministry of Social Affairs in November 1979 to define a coherent social development program. External Assistance 15. Due to large foreign inflows of remittances and transfers, the current account of the balance of payments was on averagea in equilibrium through 1975-80, and the government-guaranteed external debt has remained within reasonable limits. Net workers' remittances increaased from $166 million in 1975 to $638 million in 1980. Foreign grants e.xceeded $500 million in 1977 and fell to $335 million in 1978. Following the Baghdad Arab Summit Conference in November 1978, which pledged assistance of about $1.2 billion per year until 1983, net foreign aid rose again to a record high of about $1.0 billion in 1979 and $1.3 billion in 1980. The external public debt outstanding and disbursed reached $1.3 billion at the end of 1980; the  -5- outstanding debt to IDA was $76 million, to IBRD, $26 million, and, to IFC, $15 million ($85 million, $100 million and $2O million, respectively, when including undisbursed commitments). In 1977 and 1978, Jordan borrowed t224 million and tl00 million respectively on the Eurodollar market, but in 1979, higher foreign aid allowed the borrowing to be further reduced to $28 million. External debt service payments amounted to t134 mi-llion in 1980 or 5.4 percent of total exports of goods and services. 16. Jordan's relative stability, pragmatic economic and social policies and efficient economic management have helped to attract large foreign assistance. The continuation of foreign economic assistance at the relatively high levels of recent years obviously depends on international and regional developments. Except for aid related to defense expenditures, the grant component of this foreign assistance is expected to decline over the next few years. The projections indicate a need for external commitments close to $1 billion each year over the 1981-85 period, compared to an annual average of $420 million-for 1976-80. About one-third of this borrowing is expected to be on concessional terms, significantly below the ratios achieved in recent years. While bilateral and multilateral sources can be expected to provide the bulk of external resources, Jordan is likely to resort increasingly to the financial markets, and this would result in a hardening of loan terms. On these assumptions, the debt service ratio as a percentage of exports of goods and services is projected not to exceed 10 percent by 1985. Beyond the current Plan period, sustaining the rise in debt and debt service at a prudent rate would require a slowdown in both the rate of investment and growth, particularly if foreign grants are gradually phased out. Give,n its record of prudent management, Jordan remains creditworthy for Bank lending. PART II - BANK GROUP OPERATIONS 1! 17. Jordan has received eight Bank loans totalling $185 million and fifteen IDA credits totalling $86.1 million (net of cancellations) of which thirteen credits have been fully disbursed. Project implementation and disbursement performance are generally satisfactory. In recent years, disbursements have consistently amounted to about 80 percent of appraisal estimates. The difference is essentially due to problems encountered with local contractors and the construction industry. The Bank is monitoring the development of the construction industry and helping to tackle specific problems through technical assistance. The IDA credits have financed mainly physical and social infrastructure projects, such as education, highways, water supply and sewerage, power, irrigation and tourism. By mid-1978, Jordan had attained a stage of economic development where it could be considered creditworthy for Bank lending, and had reached a GNP per capita level that exceeded IDA limits. IDA lending was thus discontinued after March 1978. IFC has made investments in Jordan with total commitments of $94.2 million. Annex II contains a summary statement of Bank loans and IDA credits, and IFC investments as of September 30, 1982, and notes on the execution of ongoing projects. I/ Substantially unchanged from Part II of the President's Report for the Fifth Power Loan which was distributed to the Executive Directors on May 6, 1982.  -6- 18. Bank Group assistance to Jordan has been d irected toward export- oriented projects on which the Bank Group has cooperated clo6sely with the Government in project preparation and in the mobilizatiorL of large external financial assistance. In addition, the Bank Group has been assisting the Government in implementing its social objectives of improving the income and living standards of the rural and urban poor, as well as expanding manpower training, as enunciated in the first Five-Year Plan (1976-80) and which is being given an even greater emphasis in the second Five-Year Plan (1981-85). 19. In line with these objectives, the Bank Group has provided technical assistance for developing and implementing a plan for expanding phosphate rock mining, and for preparing a comprehensive program for a second phase of development of the agricultural potential of the Jordan Valley and for water supply based on the Maqarin Dam. An engineering credit was made in FY1975 to help prepare a large project for potash production from t:he Dead Sea via solar evaporation, for which a loan was approved by the Executive Directors in September 1978; the project has been successfully completed. In addition, further support for the Government's social and economic objectives was provided in recent years by loans for the Third and Fourth Education projects approved in December 1979 and December 1981, the Cities and Villages Development Bank (CVDB) project approved in March 1980, t:he Urban Development project approved in July 1980, and the Fifth Power project approved in May 1982. 20. The Government has requested assistance from the Bank to achieve the Plan objectives with respect to vocational and technical training in order to meet the manpower needs of the economy. Two education projects are under preparation for consideration in the current and the next fiscal years. Projects are also under preparation in the industry and urban sectors for consideration in this and subsequent fiscal years. 21. At the end of 1980, the actual Bank Group share in Jordan's total external public debt was estimated at 8 percent, and its share in debt service was 2 percent. By 1985, the Bank Group's shares in debt outstanding and in debt service are expected to be about 10 percent and 7 percent respectively. PART III - THE WATER SUPPLY AND SEWERAGE SECTOR 22. Water Resources. About 80 percent of Jordan's land area is desert. Availability of water depends largely on rainfall, which is negligible in the desert areas and up to 600 millimeters/year in other parts. Most of the municipal water supply systems and industry depend upon groundwater and springs. The rapid growth of the economy in recent years and t:he associated increase in municipal, industrial and agricultural water demand have put serious pressure on water resources. Jordan's known water resources may not be sufficient to meet its future needs and water scarcity may become a principal constraint to economic development. 23. Some urban areas, in particular the Amman, Zarqa, Ruseifa conurbation, are already facing water shortages. The Government has embarked on a program of large water projects to help relieve water shortage in the major urban areas. The Azraq pipeline (in operation), and t'he water  -7- transmission system (under construction) from the East Ghor Main Canal in the Jordan Valley are among the principal projects and would provide about 55 million cubic meters of water per annum to the Amman area. The Government is also building facilities to reduce pollution in the Zarqa River, which receives discharge from Amman, Zarqa and Ruseifa. This river flows into the King Talal Reservoir, which is an important source of irrigation water. 24. Sewerage. Only three cities at present have sewage collection systems: Amman has a treatment plant utilizing the activated sludge process which meets part of the capital city's needs; Salt operates aerated lagoons; Aqaba uses primary treatment. The three systems serve about 18 percent of the total Jordanian population. Other towns and villages with piped water systems (about 60 percent of the total population) discharge their wastes in septic tanks, cesspools and similar facilities. The remaining population uses pit privies and latrines or has no sanitation system at all. Individual waste disposal facilities are inadequate in many urban centers. In cities such as Zarqa and Ruseifa, the soil is no longer capable of disDosing of the increasing amount of effluents. Cesspool overflows and improper disposal of cesspool waste create major health hazards. Severe outbreaks of cholera have occurred in Jordan, the latest in 1981. 25. Serious contamination occurs in groundwater in Lhe upper aquifer underlying communities using cesspools. While this groundwater is not used for potable water supply, the danger of this polluted water entering water mains during periods of depressurization exists. The quality of the groundwater in the lower aquifer, which is principally used for potable water supply, has not been impaired. 26. Sector Organization. Like most public sector projects, water development activities are coordinated and assisted at the national level by the National Planning Council (NPC), which is the central planning authority of the country. The Natural Resources Authority (NRA) has overall responsibility for water resources studies and planning throughout Jordan. Responsibility for community water supply and sewerage is divided between the Water Supply Corporation (WSC), the Amman Water and Sewerage Authority (AWSA), the Jordan Valley Authority (JVA) - all created in 1973, and a number of larger municipalities. AWSA is responsible for water supply and sanitary and stormwater sewerage in the city of Amman, serving in 1981 about 650,000 people. JVA is responsible for development in the Jordan Valley and provides water supply to communities in the valley. In 1981, WSC operated the water systems in about 350 large and small communities, and provided bulk water supply to about 430 communities that operated their own systems. WSC's charter requires it to provide sewerage facilities to communities as part of its service. Eight municipalities including Zarqa and Ruseifa operate their own water systems with independent groundwater sources. The Government has recently announced its intention to transfer responsibility for all municipal systems to WSC, except in Amman and in the Jordan Valley. The takeover is already in progress and systems in the cities of Irbid, Madaba, Aqaba, Salt and Tafila are now managed by WSC. Transfer of the Zarqa and Ruseifa systems is underway and would be completed in early 1983. 27. Organization and Management of WSC. WSC was established in 1973 as a corporation enjoying independent financial and administrative status. It has  -8- an eight-member Board of Directors, chaired by the Minister of Municipal and Rural Affairs. The headquarters in Amman is managed by a Director General and includes departments in charge of administration, planning, finance, design, follow-up, operation and maintenance, legal matters and general inspection. Project implementation units are established for large projects. Field operations are conducted through four regional offices. The staff of WSC numbered about 1,200 in 1981 before the takeover of other municipal systems, corresponding to about twenty-one employees per one thousand connections served by its distribution systems. This ratio will, however, improve with the takeover of the municipal systems and connections served per employee would almost double by 1988. On the other hand, given these increasing responsibilities, the managerial, engineering and accounting capabilities in WSC would need substantial strengthening. Such skills are not easy to find in Jordan. In addition, experienced sewerage operators are not easily available, as sewerage operations are at present still very limited in the country. Management assistance and training (paras. 39 and 40) provided under this project will address these weaknesses. 28. Given the growing pressure on water resources and the plans for inter-basin water transfer, additional coordination among the three major water agencies (AWSA, WSC, JVA) would be necessary. Responding to a Government request, the Bank has made recommendations to the Jordanian Government to establish a national water organization. The creation of such an organization has been included in the current five-year plan (1981-85) and its proposed statute is under review. IDA/Bank Role In Water Supply and Sewerage 29. The Bank commenced its assistance to the water supply sector in the 1960s. A $1.5 million credit in 1961 (Cr. 18-JO) and a $2.5 million credit in 1963 supported water supply development respectively in Amman and in the cities of Ramallah-El Bira (Jerusalem), Nablus, Azraq, Irbid and Zarqa. These aforementioned projects have been successfully completed. The Zarqa project has provided new wells, pumping station, transmission main, storage capacity, and improvement and extension of the distribution system in part of the area covered by the proposed project. In the 1970s the Government concentrated its efforts on developing water supply and sewerage in iAman. In this context, the Bank recommended the creation of an autonomous water supply and sewerage agency. The Government adopted this approach and created AWSA. The $8.7 million credit (Cr. 385-JO) of 1973 and the t14 million credit (Cr. 780-JO) of 1978 assisted the development of AWSA and helped finance investment plans for water supply and sewerage in the rapidly expanding capital city of Amman. The completion report (Sec. 79-491) of the 1973 project (Cr. 385-JO) noted that while substantial effort had been made in the institutional development of AWSA, some inherent weaknesses remained., particularly in the financial department. The institutional development effort was continued and the remaining problems were addressed under the Third Amman Water Supply and Sewerage Project (Cr. 780-JO) which is now nearing completion. 30. The Bank's major objectives in the sector are to support the Jovernment's efforts to (i) rationalize utilization of scarce water resources, (ii) develop effective water supply and sewerage services, and (iii) accel- erate institution building. The Bank's efforts have been fruitful in the  -9- development of AWSA and the Amman water supply and sewerage network. Further assistance to the Amman region is under consideration. The proposed project would similarly assist WSC and once again extend Bank assistance to other cities. A sector study which is scheduled to be carried out in FY83 would focus on further institutional needs and on developing an integrated investment plan for the sector. 31. Water Supply and Sewerage in the Project Area. The area to benefit from the project consists of the adjoining cities of Zarqa and Ruseifa which are located about 20 km northeast of Amman. The two cities rank second and fourth in size as compared to other cities in Jordan and are included in the Greater Amman Region for planning purposes. Their combined population, about 300,000 people, is the largest urban population next to Amman. The Zarqa/Ruseifa area is one of the principal industrial centers in Jordan and many medium-size industries are located there. 32. Households in the two cities have an average size of seven persons and are generally characterized as low and middle-income families. Almost all of them receive piped water from the public water systems. However, the main distribution system does not reach many newly developed areas, which are now served by temporary connections laid above ground. The distribution systems in both cities need strengthening and rehabilitation. Water is supplied from wells and it is estimated that demand up to 1986 can be met from these sources. The planned supply to the Greater Amman area (including Zarqa and Ruseifa cities) from the East Ghor Main Canal (para. 23) would help meet the demand beyond that date. The Government has agreed to allocate sufficient water to Zarqa and Ruseifa to ensure the operation of the water supply systems under the project (Loan Agreement, Section 3.04). All sewerage in the two cities is disposed of in cesspools, which are periodically emptied by tankers. The sludge is dumped at an approved site 25 km from Zarqa. The system is no longer adequate due to soil saturation, and overflows arise from negligence. The two cities do not have adequate stormwater drainage. Flooding occurs during rainstorms in low areas and the need to improve stormwater drainage in frequently flooded areas is pressing. PART IV - THE PROJECT 33. Background. The proposed project was prepared by the Government with the assistance of the United States Agency for International Development (USAID) during 1978 - 1980. The Government requested Bank participation in the financing of the project in April 1981. A Bank preparation mission visited Jordan in October 1981, and the project was appraised in February/ March 1982. Negotiations were held in Washington from September 13 to 17, 1982. The Jordanian delegation was headed by Dr. Hanna Odeh, President of the National Planning Council (NPC), and included representatives of the Water Supply Corporation and NPC. A Staff Appraisal Report entitled "Zarqa/Ruseifa Water Supply and Sewerage Project" (No. 4049-JO) dated October 5, 1982, is being distributed separately to the Executive Directors. The main features of-- the Loan and Project are given in the Loan and Project Summary at the beginning of this report and in Annex III.  =10- Project ObjectivLs and Description 34. The main objectives of the project are to improve waler supply and to establish a nmodern sewerage system in Zarqa and Ruseifa (see m; ape). The project would also help strengthen the institutional structure Df the Water Supply Corporation (WSC). 35. The project, which is a least-cost solution, includes the following main components: (i) water supply - construction of about 133 km of trunk and distribution mains, and provision of 12,000 supply arid production meters; (ii) sewerage - construction of about 364 km of trunk, subtrunk and collection sewers and force main, 30,000 house laterals, sewage pumping station and sewage treatment plant; (iii) stormwater drainage - construction of about 14 km of stormwater culverts; (iv) buildings, equipment and vehicles - construction of a maintenance workshop and provision of vehicles and equipment required for operations; and (v) institutional assistance - provision of experts and consultants to develop a public utility accounting system, conduct a tariff study, and assist in an organizational study as well as in the training of WSC staff. 36. The water supply component is the first phase of a program to strengthen the distribution system in the populated areas of the two cities and to extend the distribution system to rapidly developing districts. The sewerage component is also the first phase of a sewerage program and will serve districts including the commercial centers and the more densely populated areas of the two cities with a total population in served areas of over a quarter of a million in 1982, which is expected to increase to about half a million by the end of this century. The treatment: plant will consist of primary settling followed by secondary treatment. It will improve water quality in the Zarqa River. Gas from the treatment process will be used to generate electricity for use in the plant. The stormwater drainage component will provide underground culverts and sewers in six heavily inhabited areas in Zarqa and one area in Ruseifa to relieve annual flooding. These areas also contain important road and highway intersections. The institujtion building measures would strengthen the organization, operations and financial activities of WSC, and prepare it for the wider operational responsibility it is now assuming. Project Cost and Financing 37. The project cost (excluding interest during construction) is estimated at about $91 million including a foreign exchange ccrrponent of about $53 million. Cost estimates exclude import duties and taxes as WSC is exempt from these. Physical contingencies have been estimated at about 15 percent. Price contingencies are about 15 percent of the base cost: increased by physical contingencies. Price contingencies have been calculated at the annual rates of 8 percent for 1982 and 1983, 7.5 percent for 1984, 7 percent for 1985, and 6 percent for 1986 and thereafter. A breakdown c,f cost by principal components is provided in the Loan and Project Summary. The cost of foreign consultant services (380 man-months) is estimated at about $12,000 per man-month and local consultant services (210 man-months) at about $6,000 per man-month. The proposed loan would finance 50 man-months of foreign  -11-I consultant services at an average cost of $11,200 per man-month including salary,fees, overhead, international travel and subsistence. The Government would contribute about $30 million (33 percent) in the form of equity, and the customers, $7 million towards project financing. In addition, the Government would finance interest and other charges during construction on all loans for a period of five years amounting to about $12 million. The proposed Bank loan of $17 million would be made to the Government, which coordinates all foreign exchange financing for public sector projects, on standard Bank terms applicable to Jordan: a 17-year repayment period, including a 4-year grace period. The Government would onlend the Bank loan to WSC under a subsidiary loan agreement with a repayment period of 17 years, including a 5-year grace period, at a fixed interest rate substantially in line with that of the proposed Bank loan (during first half of FY83). The Government applies these onlending terms generally to comparable public sector institutions. Interest on the subsidiary loan would be capitalized during the grace period as would the front end fee. An onlending rate substantially in line with the Bank interest rate would be positive in real terms as the inflation rate projected for 1982-1984 is 8 percent per annum. WSC would bear the foreign exchange risk on the loan. The Bank loan would cover about 32 percent of the foreign exchange cost and about 19 percent of the total cost. The remainder of the project cost would be co-financed by USAID - $15 million, KfW - about $14 million, and the Islamic Development Bank - about $8 million. Project items to be financed by each co-financier are indicated in Annex 5, page 2 of the Staff Appraisal Report. Conditions of loan effectiveness include the execution of a subsidiary loan agreement between the Government and WSC, and the signing of loan agreements between the Government and other co-financiers (Loan Agreement, Section 6.01 (a) and (b)). Co-financing arrangements are in an advanced stage. 38. Project Implementation. WSC will be responsible for project execution and has agreed to set up a project implementation unit. Establish- ment of this unit and the appointment of the Project Manager are conditions of effectiveness of the proposed loan (Loan Agreement, Section 6.01 (c)). The unit would be substantially staffed by end September 1983. WSC has commenced land acquisition and gaining access to the land for construction purposes should not pose any problems. For the operation of its future Zarqa/Ruseifa system, WSC will establish a management unit reporting initially to the regional office-for the Amman Governorate, to be upgraded to regional office status at a later date. The project is expected to be completed by end-1988. An understanding has been reached on an implementation schedule, including timing of critical project activities. Management Assistance and Training (WSC) 39. In view of its country-wide responsibility and growing operations, WSC intends to strengthen its organization (para. 27). For this purpose it will conduct an organizational study together with consultants provided under the project. This study will propose an organizational structure in light of the Government's sector objectives, provide job descriptions and statement of objectives for managerial positions, review personnel policies, and develop administrative, operating and maintenance procedures, and a reporting system. WSC's salaries are competitive and no major problems are expected in recruiting and retaining local staff.  -12- 40. Training for WSC staff will be provided by the United States Agency for International Development (USAID). Provision has been made under the Fproject for the training of 12 managerial and professional staff abroad and about 100 other operating staff at local training institutions. Excellent facilities exist at the Amman Polytechnic Institute which now provides t:raining for up to 600 technicians per year in the mechanical (including hydraulics), chemical, electrical and civil engineering fields. Training in water supply and wastewater engineering is being planned and will be offered shortly. In addition to the above training effort, consuLtant services will be available for the on-the-job training of treatment plant operators and for operational support during start up. Accounting staff will alsc receive on-the-job training from the financial advisor to be recruited under the project. 41. WSC's Financial Position. WSC provides water in bulk to urban municipalities and operates rural water systems and desert water wells. It is IIow taking over urban water systems. It has not yet operated full-scale sewerage; its sewerage revenues are negligible, and its sewerage tariffs and charges based on rental value do not reflect the cost of service. The tariffs charged for water in urban areas are in line with the cost of water supply services. However, this is not the case for rural water supply. WSC operates the rural water systems on behalf of the Government, as part of a national program to enhance living conditions in those areas. Unit production costs for some of these systems are about ten times higher than those prevalent in urban agglomerations because of the lack of economies of scale. Tariffs in line with these costs would be prohibitively high. Through these rural operations WSC incurs losses which are absorbed by the Government. WSC's overall financial position reflects the nature of its current operations as described abcive. During the past three years WSC's overall net cash flow (including compensation for rural operations) was adequate to meet operational requirements and to provide limited financing for construction. The Zarqa and Ruseifa water systems, hitherto operated by the respective municipalities and now being taken over by WSC, have obtained better financial results due to lower operating and capital costs associated with economies of scale. A larger portion of new works was financed out of the net cash flow. WSC has a low debt/equity ratio (15:85 in 1981) reflecting large Government contributions to construction in the past. With the tariff adjustments indicated in para. 42 below, servicing of future debt should not pose any difficulty. 42. Future Development. WSC intends to strengthen its organizational structure, operational capabilities and financial position. As a first step towards strengthening its financial position, WSC would establish proper financial management methods and set up a new accounting system with the help of a financial advisor. In addition, during 1984 it would carry out a tariff study in order to review the adequacy of its tariffs, tariff structure and other service charges in all areas of its operations. In particular, it would establish appropriate sewerage tariffs and charges that would ensure cost recovery. These improvements would take place while WSC"s operations are rapidly expanding (paras. 26 and 27) with substantial impact on its structure. Therefore, the Government intends to keep the objectives and the  - 13- performance of the Corporation under close review. The completion of the tariff study towards the end of 1984 would provide the opportunity for an exchange of views on the Corporation's financial objectives and tariff policy between WSC, the Government and the Bank (scheduled for March 1985). Meanwhile, agreement has been reached with WSC on minimum financial objectives. These would be separate for its urban and rural water operations as well as its sewerage operations. For its urban water services its objective would be to secure, through appropriate tariffs, revenues sufficient to cover operating and maintenance expenses, debt service or depreciation, whichever is higher. Starting with the fiscal year 1986, when a new tariff schedule would be established, WSC would generate funds from internal sources sufficient to finance not less than 10 percent of the average investment cost in each consecutive three-year period (Project Agreement, Section 4.03). For its rural water services WSC would, adjust tariffs at the beginning of 1987, to cover a reasonable portion of operating and maintenance cost to be agreed upon with the Government in light of the tariff study (Project Agreement, Section 4.04). The Government would continue to provide supplementary funds to WSC for operating and maintaining the rural water systems (Loan Agreement, Section 3.03). With respect to its sewerage operations, WSC would implement a combination of user charges and tariffs that would, together with Government payments from fees and specific charges collected from beneficiaries, provide revenues sufficient to cover operating and maintenance expenses, and debt service or depreciation, whichever is higher. This policy would apply for all WSC sewerage operations from the time of their commissioning (Project Agreement, Section 4.05). The tariff study would provide recommendations on a new system of charges and fees to be collected by the Government based on sewerage improvements. The study would give due regard to modifications, if needed, to the existing system of landowner contributions which are based on annual rental value. The Government would, upon review of the tariff study, collect user charges and fees on benefits resulting from sewerage improvements. Such user charges and fees would be in force by the beginning of 1986 for the Zarqa/Ruseifa system. For all other areas, they would be applied when sewerage systems are commissioned (Loan Agreement, Section 3.06). Accounts and Audit 43. WSC's present accounting system, which is on a cash basis, follows the system prescribed for government agencies. This system does not meet the accounting requirements of a public utility with country-wide responsibili-- ties. WSC is considering steps to introduce an appropriate public utility accounting system. It is in the process of recruiting an expert in public utility accounting and management, and would use the services of an independent computer service bureau in the initial years. This accounting system would separate the accounts of various branch offices, including those of the proposed project. Like all government corporations, WSC is subject to expenditure controls and final audit by the Public Auditing Department. Nevertheless, with the establishment of the new accounting system, WSC would introduce a more comprehensive audit that would serve as an effective financial management and evaluation tool.  -14- Procurement and Disbursement 44. Equipment and civil works to be financed by the proposed loan would be procured through international competitive bidding. Contracts for these items of less than S350,000 each up to an aggregate value of t] million can be awarded through local competitive bidding procedures which are acceptable to the Bank. For bid evaluation purposes, a margin of preference equal to the custom duties applicable to competing imports or 15 percent of CIF price, whichever is lower, would be allowed to suppliers of locally manufactured goods. The proceeds from the Bank loan, to be disbursed over 1rhe period 1983 - 1989, would finance: (i) 100 percent of foreign expenditures and 85 percent of local expenditures for locally procured items of machinery and equipment for the sewage treatment plant and workshop; (ii) 38 percent of total expenditures (corresponding to about 75 percent of foreign exchange cost) for civil works related to water supply, sewerage, sewage treatment plant and workshop; and (iii) 100 percent of foreign expenditures for consultant services (50 man-months). The loan closing date would be June 30, 1989. Benefits and Risks 45. The project would provide better water supply and sewerage services in Zarqa and Ruseifa. It would eliminate hazardous cesspool operations and protect the quality of water in the lower aquifer. In addition, it would improve the quality of water in the Zarqa River and the King Talal Reservoir for downstream use. Curtailment of untreated discharge into the Zarqa river would improve health conditions along its banks, and reduce the risk of cholera and other waterborne diseases. This is an important step towards more efficient use of scarce water resources. The project would nelp develop WSC into a strong sector institution to fulfill its newly assigned responsibil- ities of operating water supply and sewerage systems in many parts of Jordan. However, the majority of the benefits cannot be quantif:Led and therefore it is not possible to compute a meaningful economic rate of return for the project. Using a discount rate of 10 percent which reflects the opportunity cost of capital, the average incremental cost of the sewerage system is estimated at JD 0.286 per cubic meter of water utilized and discharged. This compares well with the present cost of operating cesspools which is JD 0.260 per cubic meter. In view of the substantially better service to be provided by the project, the beneficiaries are expected to be willing to pay t:he average incremental cost, thus ensuring economic use of the sewerage system and cost recovery. The water supply component constitutes about 14 percent of the total project cost and is only part of the costs required for future water supply. The major cost of meeting future water demands of the two cities will be in the purchase of additional water required after 1986, when the allowable groundwater extraction from the aquifer is expected to be reached. This external source of water, which is assumed to be from the East: Ghor Main Canal, would about triple the present cost of water production. The average incremental cost (A.I.C.) of water supply has been calculated to be JD 0.341/m3 at a discount rate of 10 percent, of which about JD 0.240/m3 is attributable to future water purchase. Thus, prior to the need of WSC to purchase water from an external source around 1986, WSC's average tariff (JD 0.140/m3 in 1982) will be more than adequate to recover full costs (the  -15- A.I.C., excluding the cost of water purchase from East Ghor Main Canal, is estimated to be about JD 0.100/m3). Looking ahead beyond 1986, WSC's tariffs withi highest block rate of JD 0.400/m3 already reflect the A.I.C. and will therefore promote conservation and economic water use. The proposed tariff study will further examine the appropriate tariff structure that will allow adequate cost recovery, beyond 1986. The water supply and sewerage services would be affordable for the inhabitants of the project area as combined water and sewerage charges would be about 3 percent of household income for a family in the twentieth percentile income level. This is comparable to what such a family pays currently for water supply and cesspool operations. In addition, low-income inhabitants would have access to credit for meeting sewerage connection charges. 46. The project faces no major risks. Nevertheless, only limited amount of construction work on sewerage networks and sewage treatment plants has been executed in Jordan and WSC has no experience with large sewerage systems. There is, therefore, a risk of delay in construction of the sewerage component as well as in proper operation of the treatment plant. The measures included in the project, such as: (i) assistance by consultants for construction supervision and management and organization; (ii) the proposed training for WSC staff; and (iii) the Bank's close monitoring of project progress, should help minimize the risks. PART V - LEGAL INSTRUMENTS AND AUTHORITY 47. The draft Loan Agreement between the Hashemite Kingdom of Jordan and the Bank, the draft Project Agreement between the Bank and the Water Supply Corporation (WSC) and the Report of the Committee provided for in Article III, Section 4 (iii) of the Articles of Agreement of the Bank are being distributed separately. Special conditions of the project are listed in Section III of Annex III. The execution of a subsidiary loan agreement between the Government and WSC, the signing of co-financing loan agreements between the Government and other co-financiers and the establishment of a project unit as well as appointment of a project manager would be special conditions of effectiveness (Loan Agreement, Section 6.01). 48. 1 am satisfied that the proposed loan would comply with the Articles of Agreement of the Bank. PART VI - RECOMMENDATION 49. I recommend that the Executive Directors approve the proposed loan. A. W. Clausen President by Ernest Stern Attachments October 26, 1982 Washington, D.C.  -16- ANNEX I Page 1 of 6 JORDAN - SOCIAL INDICATORS DATA SHEET JORDAN REFERENCE GROUPS (WEIGHTED AVEaAG7 AREA (THOUSAND SQ. KM.) - MOST RECENT ESTIMATE) - TOTAL 97.7 MIDDLE INCOME AGKlCLLTLRAL 14.7 MOST RECENT NORTH AFRICA & MIDDLE INCOME 1960 /b 1970 /b ESTIMATE /b MIDDLE EAST LATIN AMERICA 6 CARIBBEAN ONP PER CAPITA (US$) .. 380.0 1420.0/c 1253.6 1902.0 ENERGY CONSCMPTION PER CAPITA (KILOGRAMS OF COAL EQUIVALENT) 185.7 269.0 522.3 713.5 1259.4 POPULATION AND VITAL STATISTICS POPU'ATION, MED-YEAR (THOUSANDS) 1695.0 2299.0 3244.0 URBAN POPULATION (PERCENT OF TOTAL) 42.7 49.6 56.3 47.3 65.7 POPCLATION PROJECTIONS POPULATION IN YEAR 2000 (MILLIONS) 5.8 STATIONARY POPULATION (MILLIONS) 12.6 YEAR STATIONARY POPULATION IS REACHED 2085 POPULATION DENSITY PER SQ. KM. 17.3 23.5 32.0 35.8 35.2 PER SQ. K0. AGRICULTURAL LAND 132.4 163.6 212.7 420.9 92.5 POPULATION AGE STRUCTURE (PERCENT) 0-14 YRS. 44.4 45.8 46.5 44.3 39.7 15-64 YRS. 51.5 51.0 50.8 52.4 56.1 65 YRS. AND ABOVE 4.1 3.1 2.7 3.3 4.2 POPULATION GROWTH RATE (PERCENT) TOTAL 3.1 3.0 3.4 2.8 2.4 URBAN S.2/c 4.5 4.7 4.6 3.8 CRUDE BIRTH RATE (PER THOUSAND) 47.4 47.6 44.4 41.2 31.4 CRUDE DEATH RATE (PER THOUSAND) 19.9 15.5 9.7 12.2 8.4 GROSS REPRODUCTION RATE 3.5 3.6 3.4 2.9 2.1 FAMILY PLANNING ACCEPTORS, ANNUAL (THOUSANDS) USERS (PERCENT OF MARRIED WOMEN) .. .. .. FOOD AND NUTRITUON UNDEX OF F00D PROD,CTION PER CAPITA (1969-71-100) 220.0 79.0 106.0 100.4 110.0 PER CAPITA SUPPLY OF CALORIES (PERCENT OF REQUIREMENTS) 93.2 67.3 61.6/d 108.5 108.4 PROTEINS (GRAMS PER DAY) 60.9 40.2 40.375 71.9 66.0 OF WHICh ANIMAL AND PULSE 14.6 10.7 1l.0/d 18.0 34.0 CHILI (AGES 1-4) MORIALITY RATE 26.3 12.4 5.8 15.1 5.6 HEALTH LIFE EXPECTANCY AT BIRTH (YEARS) 47.0 54.1 61.2 56.9 64.2 INFANT MORTALITY RATE (PER THOUSAND) 135.5 97.5 69.3 104.3 64.2 ACCESS TO SAFE WATER (PERCENT OF POPULATION) TOTAL 21.3 .. 61.0/c t 59.1 65.6 URBAN 48.6 .. 66.o7i 83.1 78.9 RURAL 2.1 . . .0 39.8 43.9 ACCESS TO EXCRETY DISPOSAL (PERCENT OF POPULAIION) /2 TOTAL - 59.3 URbAN .. .. .. ,, 75.3 RURAL .. .. .. .. 30.0 POPULATION PER PHYSICIAN 5804.7 3775.0 1956.4 4015.5 1617.3 POPULATION PER NURSING PERSON 1930.2/e 1477.5 821.0 1802.2 1063.5 POPULATION PER HOSPIUAL BED TOTAL 557.0 1351.5 1186.8/d 641.7 477.4 URBAN . . 1097.6 687.27W 538.3 679.8 RURAL ,, 5543.6 . . 2403.3 1903.4 ADMISSIUNS PER hOSPITAL BED .. 36.5 45.7/d 25.5 27.3 HOESING AVERAGE SIZE OF HOUSEHOLD TOTAL 5.3 6.1 6.7/c URBAN 5.5 .. RURAL 5.1 .. . AVEUACE NJYiBER OF PERSONS PER ROOM TOrAL .. . 6. .5/c . URBAN .. .. .. .. RUKAL .. .. ACCUSS TO ELECTRICITY (PERCENT OF DITELLlNGS) TOTAL 17.0 . 66.0/c .. . URBAN 39.2 .. 90.07.. RURAL 1.4 .. 30.07- TI7TO--7p7ercent in i982V. /2 (See para. 24 of this report.)  -17- ANNEX I Page 2 of 6 JORDAN - SOCIAL INDICATORS DATA SHEET JORDAN REFERENCE GRO!PS (WFI(;H;'ED AUV,fAGES - MIOST_REENT ESTI MATE) - MIDDLE INCDME MOST RECENT NORTH AFFICA & MIDDLE ;NCCME 1960 /b 1970 /b ESTIMATE /b MIDDLE EAST LATIN AMERICA & CARIBBEAN EDUCATION ADJUSTED ENROLLMENT RATIOS PRIMARY: TOTAL 77.0 72.0/c 102.0/c 88.7 104.3 MALE 94.0 79.o07T 106.o0T 104.5 106.4 FEMALE 59.0 65.0/c 99.0/c 72.0 103.3 SECONDARY: TOTAL 25.0 33.0/c 74.0/c,f 39.7 41.3 MALE 36.0 41.07T 8ei.oThT 49.3 40.4 FEMALE 13.0 24.0Th 66.0Th7f 29.0 41.8 VOCATIONAL ENROL. (1 OF SECONDARY) 2.7 3.0/c 12.0/c 10.1 33.7 PUPIL-TEACHER RATIO PRIMARY 34.1 38.8/c 32.2/c 34.1 29.9 SECONDARY 20.0 23.0oT 20.6Tc 23.7 16.7 ADULT LITERACY RATE (PERCENT) 32.4 .. 70.0 43.3 79.1 CONSUMPTION PASSENGER CARS PER THOUSAND POPULATION 3.7 6.7 19.6/d 17.8 42.8 RADIO RECEIVERS PER THOUSAND POPULATION 37.8 160.9 171.5 131.3 270.5 TV RECEIVERS PER THOUSAND POPULATION .. 20.0 52.8 44.1 107.7 NEWSPAPER ("DAILY GENERAL INTEREST") CIRCULATION PER THOUSAND POPULATION 18.3 24.4 29.3/d 31.5 63.7 CINEMA ANNUAL ATTENDANCE PER CAPITA 3.0 0.9 4.0 1.7 2.7 LABOR FORCE TOTAL LABOR FORCE (THOUSANDS) 432.3 568.6 768.9 FEMALE (PERCENT) 5.0 5.6 6.5 10.6 24.4 AGRICULTURE- (PERCENT) 44.0 34.0 20.0 42.4 31.3 INDUSTRY (PERCENT) 26.0 9.0 20.0 27.8 23.9 PARTICIPATION RATE (PERCENT) TOTAL 25.5 24.7 23.7 26.0 33.6 MALE 46.7 45.5 43.4 46.2 50.4 FEMALE 2.7 2.8 3.1 5.6 16.8 ECONOMIC DEPENDENCY RATIO 1.9 2.0 2.1 1.9 L.3 INCOME DISTRIBUTION PERCENT OF PRIVATE INCOME RECEIVED BY HIGHEST 5 PERCENT OF HOUSEHOLDS .. HIGHEST 20 PERCENT OF HOUSEHOLDS .. LOWEST 20 PERCENT OF HOUSEHOLDS . . LOWEST 40 PERCENT OF HOUSEHOLDS . . POVERTY TARGET GROUPS ESTIMATED ABSOLUTE POVERTY INCOME LEVEL (US$ PER CAPITA) URBAN .. .. 230.0/d 279.2 RURAL .. .. 100.07/ 178.6 184.1 ESTIMATED RELATIVE POVERTY INCOME LEVEL (US PER CAPITA) URBAN .. .. 206.0/d 403.6 518.0 RURAL .. .. 135.07/ 285.6 371.1 ESTIMATED POPULATION BELOW ABSOLUTE. POVERTY INCOME LEVEL (PERCENT) URBAN .. .. 14.0 22.1 RURAL .. .. 17.0 30.9 Not available Not applicable. NOTES /a The group averages for each indicator are population-weighted arithmetic means. Coverage of countries among the indicators depends on ava'ilability 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 1978 and 1980. /c East Bank only; /d 1977; /e 1962; /f Includes preparatory education ages 12-14 years. May, 1982  -is- ~~~~~~~ANINEX I Page 3 of 6 DtPN:TONS OF SOCIAL INDICATORS Noenra Al though the land are drw free sour.es genera u udged" the mee .auhoitaivean reitahe. it should also. be toted elhltat ny na re be inter- noteona 1n naprehir hn nose u the lan nf stadardized deEIiris on an Ien t used by lIftenent neunrin in~ nolientng the dun. t d. Za ant' nIn- theles . usoul tndesnnth nedee nfmgiue-Jdt.,rns adnua eie eti an diff e.ennet be-ene-n-tee- ef hn ujtneee (enep fur ..... Iifb hnnem Oi Ieenr' grou thre 'fiu i2 r I-.teem to-t Ail e it n udelue lnoe on oo tngrr ' aeuie-ultura1 offmutes). to ec endenennegrenp aea ter aveages ae pupianIonneightd ee'thersi deonegeeieob indtortn nd urunt ndy t he oneitd enerotan..ler amngte enty n rfreurgeI ABOA fibeusend sqAn.) Porulatien err geseiralI IBed.to.-. lItettid , urban,itatdInforo - -iPiopu.,t.ionh:(-onoh lesol - Totl auefooe aee nanprie eg lund sea and Inan eaterrs;17 daa ra,aderi iie.b hirese t nbr uptlbd '.ri,y .1 he Ir.-I I g...b i.dit~~by t eas en pyalla.t depnb-adeeortht pro bidieg p Innpd- ume Sf11PSRCAPO 15ff- As- peeuatsetias atIor~. nue gen Ioe peoe. i.dio. .t-T-deltr ar-nt nnudd ar luy elmapttp-. boo one, 1.innuehe AEnd lieee eee.m.ntr..a.ndhdr-.ueran etnra elm-.an rutrel heniea eaor ruralBd -1 -bespnul un euandr. .P,eate-rnLee p metm) in _igeneo ee- eqopinalen pee napite; ihl ,191,an 1979 nenners. tyan ialieed beeni eraI in..d... no. under vocal. I Aee.Aatsov rtflsIns e ealnse fsiteeee e Ilonee Tota PRCPIrlTiA , f(-UnS (ee$ana - hGeNJPy1;09.,190,an 1980.eOSdi.,.I .I 'l11 1. 1It.h.l deta. inerune~~~~~~~~~':k 80o Stee.. ofHtehntd .t' (perona ree '~ Antti totli, urbte, Iadel Orhntopud non penetni neal. tth attord' of unio no totel ronulation; AIosbldnnit n80gne fndodolnot sae1lbeqatr Omangd 19u80ro id O 10, n 18 duta. ba -hosn -nl foe ..t.tiut inu uroes . Mz -, ._ dtI ENERGYCONSUPION tEaR 20PIT - -.-Ino yInuv peenin.un.oedo itffooI- .1" 'Y" beIfyrneprromn l ra undo Wen~rol nnn ung ournetfn no,I ppd ano byaeadtnad theyemateit od foehtilt eeten. Idwelli itnfs,i rr. h.Iynniu l. Orldtfntntdnvn-eeeaontfeutursaly yrunnn perant..pfima;tiity0tet19peis o -tre lne9o7un unropedati.I-l.1tI rioIdd-,-4 - . eng life royro tunoy ot birch mnteeuningoithnuuonrys pee napito itnema Anneento fletonini ty (perto.. ..of.dpetaltBed)--Ttote:, unhun oundioneai&- T neerep ftioe ee MilnYe (ene u.so hone) A thre Jlenes 196u0io dent, Ited 18 of INonl, ,ud ua alltgernetOey fertlt nerdiogte ofem lenelend ent ellypduoing-prforont- 10h osne it thn-osgedon f heenin o'tunos f otaie i"Al anf- p-i t fdofrilt retsfu roenotprnse.duea nher ollma Aetmos II o t Sttonr io.;ta196t-t97a sea fooyppuainthr9nnogot dtnnerimar t-oholdfi - ot t i maLe n n,t otn a oeedfn th Irthat itr equl0 n theC deoth roe,en eloho eatru-tnrrr oId nlsen r. f. ai. nrn- atth. nionyleo ...entry toetifrepne me in nopenene.ob thou is dntia d thy feir -fertioyrtsenmeopiary.r ' _g _nholag_ peui nins;l asoly rtd o-ilded eg- d -lI- nteneg npor liafef oa-iy The1' sdioetry'pepuerio s!ice1' .as I A ountrienot"intttraruttenou tn yernaill eren1on in the yee000 and. te. rat off denloc ef Iteni5ny-rat Te. rplrau- Sn-ond-ry sndl- tItol, maLe and femalei L- Tv n as- obr s-etonar meet level. eduna-nthielvetI....ir -1II I o t 1 require an leas f.elte eas ofuproedprmay,-srutin Yer ta Inrd porultoe ist er-he - Th peat ohenl statioeyPoplne rvdsgn-a.nnnna,o ete eiiiiuentesfnpp nie'rrnllrybe reobed -i- I phIor C..tll DCTONolyo lt 1faeo e ereynot one o eea toenerit les_n eunldnd Pe pn.a.- 911- -II-yo ppleion pee sqy e b.ileethere(1 enoe)o IInatona"Irnllene trrnlet of veo-det- tna inlot Ido ions l thebirt ereat1980 -1900 and 1909 h dan. 5nndlu-ahtagoIoinal . Inunta th, pro-tyee-Itmop-it Iprn ofnd.ne"d- only; . . hIIIti.d.I 1961,er19l0tand-1979 dana. boi-tete aiey mn and ebygor"tI Ihstdiln en Iled Iv1 Pnathnt _ee Sbutr,nreet hide 01 er) oh~gar(5 emr ednondor level dinde y utonIfeorr n h 64pee)o adreie IhOyersan doen i- prnennag.reo id-yhee-tipoy hnorreepeeyleg looile. Panltietv Orne Rthe (rrneno ) -horn -etd detnn t erti rtset sbn ue CSILO-toIION d~ 1 Ih ffz, eh1Io repsahen 1960, 1970, and.rt fdIi.offriiyrt1980 dines.-ailina. t.i.e.... -,-.I .I -,e .I-;"'ll Crdaomth oe(r husn)-AteIdsh-e issn ledys adio Ecee _ners lneIen .esaa To yeuiton) -f it) tyva of ruevey fee raio pepIst i-nt96,19y sodI". L98 -hdots. y.r-h.tti..r ppIt. pr-adaes e genera pa onpr the-ahd.of o eno;eo ue fun- il cross ieadell n I. ederg ume f....raemv ilberi manned_ rceein2eL.rs in oea ori aged y.rannp vine ea-Istot of eadio- bar voml. repodemn period if per epe..tanil-s presen age r-spoli Ifee eaasu eftens; sta1r for eran yearud Roy) to he~ n1.Iechittin-e outy; 19a;sua60 ie-eraeagaedngi,90 1970, sde1991980. mealtue-htei aboished p ioerasing.d 11dr e-11I Pas -ie PeAgea-Ae..pt..m, Annesl Cthilsdr- 0-1 Aeyinee ... erprea T aeeelreIrs . losr1oul3j-1. diVid, d n) -obrnnuee ore Lradne ne fali.Perfna - laces (rera5 01mea msn)-Peontg ef d meele inenries loendi er htroitsino laaeti ef se6 nofeIldhsn age ... psra) ehuehet-ete devleea no llmaseIPeCiruain(rthsndosaio)-bmshevrgei- 19mae6d0oeni nama age group. -oulat litne daily2 - genral interestrempenr,; nefiot am. a. p-iod.e) Gl~~h _ ,tel A ... I U..t r.t.. f r.r1 id-publIep.oiet.devoted pma.ity en.. retotin eneo noe.It isd tveesr de f,d.ee t are -nt ped.) Ag....efdne yreu-1o of, eehih perne is hone.d en id-O..i hOpOCt nat.ional 196r0g p19d70e prln 1980 ; 916, 90 ad18 dato.TonliLabo Portelthuod)-Itnmnlyontepro.u n de etnlteerreanima..... by PA .... haede pisiigta needs6 lee0 norma anti-.. fishin asi. poeneon1ge o eo eo nn;l 90ad18 aa n.ity and h'eolAb neside A.-g rn frehmante teApe .at Irs, bo.p o .ei ..s sg.e T II,dan (.rnnt.-.a. fehnt.i...dTV noon nentun br...uf etnue and mend snt hu- of populatpio,.and ci tioeg 10 preney forti weace on.... an eole irpeif , s,e:Iad gun~, enlle.; uf - I -ltota-dh fote;ir beutebopld.. level;d 1916,190ad097dt.I90T97Vn 99 aa Pe_ Iricaap (epra -i.otam nof trieds -- Penaci eota"IE of par o its Peo toielnRoefood n na male., ofn TV fanala-P I tinIp ion ort ne ofpl mlh ooprg gs. (1al4 supy.. of tee is deined ser1 .V.. cese R-'-'Piy ste ern ofe a tfu min ), ud mt 1 ,tabo.-ra erneI- qui -raset fe l iut, elec amea libe b SO p td fe iima oNens- f tona I, mal In t tte le.... po,urInnofal onrtyo I indi ly; sllecraa f 6 grms f ttalpraainpeedayend00 ras ofavici nd 95,bl1970, end198 dane. ~iyt.ete sn bun g -.1oW pat i LpaI ...idt..s pulse. pear of ahdiobg. 1,1, 0 gamaminld a 0aima roleciof There steed-eaflo-AtIngI Agte-eon perote of" therY po nIn B-nu le time tbred A ced sea lonme. than these. Cof-75 tgsm tof eta poesly and" 23 gamma'of la etsaemoeden aiet..oeoe ev.imepnd i as an- average fedbe tb.ard, pepeadi pPA in.g the Thid leai eedneOuo-Rteo ouoinn 5sd Oadee Soeld. Peed Osrery;91961-65.91970 an 1977 detla.Tto th total F abee fa--re-e. .- Peeuapnsproei .... Pylec fromsema edt.o -eulee- t Prensuplyof eedde tiredg froqaimals end -uae f r gplees peeildbl, itilbI,190 anr197 dsa. 191-1110S,19T10 tres aadnnd r om lifer.tables; 1968, 1970 end.b19809deel97ef hdeu9e0nddt. elITA iT-ke ronteti.-s TARI ee, Io..Fe1.I.. I _OR O .tl IbrP.r. qife tnrnoaeron tLnn (.dpram vrg airofyaeo ieemitn h oleifO nIm..atLos-bt.. onL" p" yrtvan,onanso ponre, 11ty boyle en birth; 1961. 170 ond h9f0 duts.end obould ie in E -petd b laorsdnal noon; 1360. 0Il90d al egehper thou sue tivo births;0 196,170 and 1980" dno.' Absolute 0 pooen inton leed eta ntnolo1bty-tt iia Areesarn Sfe danee nerreve ofnoenlaniy) -Itef oSo. Pn.,rra ISum- utitt -aly dequr-te ir plu eet1--ennial v-food . oequ tp.ire.nt not beto peolefo (net,ub, dy aNdt rual atoh L recantabl enes to nafett~it alodel. =,e Ilt~.-t ,. set resuppy. 'ionludos -torane suefunesseet orfU ennA rated. hor aonvtm...o.Isimte elaiv Povert Innom lev l (0 o"ot ta ue and roIL - aste .eth of the from, ,,,Inte rorb de,spIag, andS naiof sells as 19ool relnin pedve9ny intom ed i n-hr. Oeoeprnpt eeeonhlrnnssofoeidh imply Iho nba hotrif1 enmebe of the. household and-,eat - tfoentofpopbato )ohaan noes1)..,a. c:ig tio obentA .de man have h. tohprdaieroofr7ivnaee par t ef. thei day 23 fet.-n the poorti l.. fa1il' ssonr e do;;.'165 "'tZ 9 h .. .. r, Pum., efit penp.i.e fmatl. sebin, mad psel). serve-b onrene ofspoodl cm peneesemo 1theid Iu"onnepeult ee.y 19erets 97 diape 197ma lelde- ICM ITIUI ito .. I orlietko tma disposld...soh em siImat trauet fof bata reneel..efp-l i.er2 - ,pr.,2 ..I. d and sooaee byicterhorse.. Ay- gor the sine of pit. o rifa and sf51-.i. ire t.- pr.-1 fP.- 1 1. lpIafd- eart. t "thin et h-Ppodat A-n dved..by a feIbIr el dpaneate py-alild b... . t I-Inososi and' bol'i) d -1a lIm ele athford Era aL abinat. embed as9anlersIs level. b.It -tyII..l- .