Announcement of Tunisia Embarks on Agricultural Sector Adjustment Program on September 22, 1986

.,, ..... FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. BANK NEWS RELEASE NO. 87/17 - A Contact: Fawzi H. Rihane (202) 477-5325 TUNISIA EMBARKS ON AGRICULTURAL SECTOR ADJUSTMENT PROGRAM Program aims at maintaining growth rate, reducing trade deficit WASHINGTON, September 22 -- Tunisia is set to embark on the first phase of reforms in the agricultural sector aimed at maintaining the rate of agricultural growth and reducing the trade deficit in the sector. The World Bank is supporting the reform program with a loan of $150 million. The reforms are being taken within the framework of a general macroeconomic restructuring program focused on measures to stimulate growth of non-traditional exports, to limit growth of domestic demand, and to improve the allocation and use of scarce economic resources. They should also result in a more rapid creation of employment and reduced under-employment. This restructuring will be achieved through a gradual liberalization of prices, investments and imports. ( The reforms are expected to create a more favorable environment for overall economic and sectoral growth during a period when resources are limited. In particular, changes in the framework of agricultural prices and incentives, and in the priorities for public spending are expected to make the sector a more efficient producer of import substitutes and export products. The objective of the government's Medium-Term Agricultural Sector Adjustment Program is to make agricultural production and the use of resources more efficient. Also, it aims at enhancing the role of the private sector in providing some support services, such as marketing, farm mechanization, and livestock services. The six-year (1986-91) adjustment program aims to improve the framework of prices and incentives so that prices and the system of pricing are further deregulated or linked to world market prices. Incentives will be made more effective. These measures are expected to encourage farmers to participate more in producing crops and livestock for which Tunisia has a medium-term comparative advantage. The program will re-orient the public investment and expenditure program towards high-priority projects and programs that can be completed quickly and at low cost while ensuring that funding is available to maintain existing investments. • •• I NOTE: Money figures are expressed in U.S. dollar equivalents.  • • - 2 - Basic services in support of farmers will be strengthened while private participation will be stimulated in those services that are attractive and suitable to the private sector. Other measures will focus on improving the productivity of land use and on strengthening the management of forest and fisheries resources. The Ministry of Agriculture will receive support in building up its capabilities to monitor the performance of the sector. The World Bank loan will help finance general imports and agricultural materials needed to stimulate production. These will include fertilizer and raw materials used for its manufacture, insecticides and herbicides, animal feed, diesel fuel, spare parts, tractors and pumps, veterinary supplies, raw materials for manufacturing irrigation pipes, and materials used in fisheries. The loan will be disbursed in two tranches: $100 million soon after the effectiveness of the loan and $50 million after the government has carried out specific actions, including an overall review of the implementation of the macroeconomic and sectoral reform programs. Since 1962, the World Bank has provided 71 loans totalling about $1.5 billion to support development projects in Tunisia. The International Development Association, the Bank's concessionary lending affiliate, has provided 10 credits amounting to $75.2 million. ) The implementation of these projects has been satisfactory. In a number of sectors, important policy changes and institutional improvements have been achieved, and agencies have been created or strengthened to ensure the efficient management of those sectors or sub-sectors. The Bank's support is aimed at assisting the country in its transition from a reliance on petroleum exports to a more sectorally-balanced approach to development. This will be achieved by appropriate changes in economic policies and programs while measures will be taken to increase employment and the number of development projects geared towards low-income groups. The overall objective of the Bank's lending, thus, is to emphasize projects that have a direct and rapid impact on production, employment, and exports or import savings. The World Bank loan for the agricultural sector adjustment program is for 17 years, including four years' grace, with a variable interest rate, currently 8.23 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.75 percent on the undisbursed balances. - 0 -  FOR IMMEDIATE RELEASE •World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. BANK NEWS RELEASE NO. 87/17 Contact: Antonio Pimenta (202) 477-8826 THE BAHAMAS TO IMPROVE WATER SUPPLY AND SEWERAGE WASHINGTON, October 16 -- More than 120,000 people will benefit from an eight-year project to improve the quality of water and its supply in New Providence, The Bahamas. The World Bank is supporting the project with a loan of $10 million. The project, whose total cost is $33.5 million, will also rehabilitate deteriorating sewerage facilities. It will contribute to a cleaner environment and help prevent waterborne diseases. Well fields in New Providence will be rehabilitated to improve their operation. Transmission and distribution lines will be relined or replaced and new mains installed. ) .Improvements will be made also to the facilities at Morgan's Bluff, Andros Island, from which water is exported to New Providence and at the receiving facilities at Arawak Cary, New Providence. The sewerage system in downtown Nassau will be improved, as will the system in two housing developments, and improvements will be made to the sewage disposal facilities. The civil works will be supported by a comprehensive program of technical assistance to improve the corporate structure and management of the Water and Sewerage Corporation, and provide the basis for long-term resource and environmental planning. The Caribbean Development Bank, European Investment Bank and the National Insurance Board of The Bahamas will provide cofinancing for the project. The World Bank loan is for 15 years, including three years of grace, with a variable interest rate, currently 8.23 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.75 percent on the undisbursed balances. NOTE: Money figures are expressed in U.S. dollar equivalents.