Mali - Second Mopti Rice Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 6799 PROJECT COMPLETION REPORT MALI MOPTI RICE II PROJECT (Credit 753-MLI) May 29, 1987 Western Africa Regional Office Agriculture Division C 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.  ABBREVIATIONS BNDA National Agricultural Development Bank ED Executive Director of the Bank ERR Economic Rate of Return FAC Fonds d'Aide et de Cooperation, French aid agency IDA International Development Association IER Institut d'Economie Rurale Mopti I First Mopti Rice Project (Cr. 277-MLI) OPAM Bureau of Agricultural Products of Mali ORM Operation Riz Mopti RMWA Regional Mission in West Africa, Abidjan SAR Staff Appraisal Report WARDA West Africa Rice Development Association CURRENCY EQUIVALENT Appraisal Year (1976) US$1 = MF 490  THE WORLD BANK Washington. D.C. 20433 U.S.A. O0ratoe EviuUim May 29, 1987 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on Mali: Mopti II Rice Proiect (Credit 753-MLI) Attached, for information, is a copy of the report entitled "Project Completion Report: Mali Mopti II Rice Project (Credit 753- MLI)" prepared by the West Africa Regional Office. Further evaluation of this project by the Operations Evaluation Department has not been made. Ram K. Chopra for Yves Rovani Attachment This document has h restrcted dbobution and may be ue by tocipients only in Ih pfoman of their offcWl duties. Its contents ma not otherwise be disclosed withcmt Wotrid Bank authoftatbn.  FOR OFmICIAL USE ONLY MALI MOPTI II RICE PROJECT (Cr. 753-MLI) PROJECT COMPLETION REPORT TABLE OF COYTENiS Page Preface . . ........*e, , , ,,,,, .. . . , . ... i Basic Data Sheet ....... ii Evaluation Summary ,....,..... iv I. BACKGROUND * ....... * **s*. *** *** 1 A. General ......... ,. , ., , 1 B. The First Mopti Rice Project (Cr. 277-MLI) ..... 1 II. PROJECT FORMULATION ................. 3 A. Identification and Preparation ................. 3 B. Appraisal ............ , , 3 C. Negotiations, Board Presentation and Signing ... 4 D. Objectives and Description ..................... 4 III. PROJECT IMPLEMENTATION . .......................... . . 5 A. Effectiveness and Start-up 5 B. Project Development 6 - Civil Works .....................****6*.. 6 - Land Distribution ....... ....... 6 - Agricultural Production ............. 6 - Organization and Management ............ 7 C. Cost and Financing ..........*..... ... 7 D. Key Problems ........ ................ , 9 - The Droughts throughout the Implementation Period ... .... ....... ,., 9 - Farming Problems ,, ... .................... .. 10 - Financial Problems ., *.*.**.*.*.*..**.*.***. 11 E. Borrower's Performance ................ 12 F. Bank's Performance .....,,.4*,,,,,,.,,.... 12 IV. ECONOMIC ANALYSIS .................... ,.. ...,....... 13 V. CONC.,USIONS: LESSONS LEARNED ........................ 16 Annexes 1. Projected and Attained Physical Objectives (Table) ., 19 2. Supporting Data for Economic Analysis .......... #to 21 I. Investments ...... .................,,,,..... . 21 II. Incremental Production .,..........., 23 III. Operating Costs ...**................ ,,, 25 IV. Costs and Benefits Streams ,.......... ....... 25 V. Rate of Return Calculation *..s................ 27 Mapz: TBRD 17521 Rl 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.  MALI MOPTI II RICE PROJECT. (Credit 753-MLI) PROJECT COMPLETION REPORT PREFACE 1. This is the Project Completion Report (PCR) of the Mopti II Rice Project in Mali, for which Credit 753-MLI in the amount of US$ 15.0 million was approved on November 29, 1977. The original cr3dit closing date was November 30, 1983, the actual June 30, 1985. The last disbursement was made on July 30, 1985 after which US$ 64,000 remained undisbursed. The project was tht fifth creidt for agriculture and the second for rice production in Mali. It was identified by the Regional Mission in Western Africa (RMWA) and prepar .d by the Institut d'Economie Rurale (IER) of the Ministry of Rural Development in Bamako. It was followed by the Mopti Area Development Project (Credit 1597-MLI) which was approved on May 21, 1985. 2. This PCR was prepared by the West Africa Region and is based in part on a Proect Implementation (Rapport d'Execution) Report prepared by the project implementing agency Opgration Riz Mopti (ORM) supervision reports, and the appraisal report (January 1983) for the Mopti Area Development Project. This PCR reviews elements that helped the development of the Mopti Region. 3. The PCR was not subjected to audit by OED, and the draft report was sent to the Borrower for comment on March 23, 1987. No comments were received.  - ii - MALI MOPTI II RICE PROJECT (Cr. 753-14LI) PROJECT COMPLETION REPORT Basic Data Sheet Actual as Actual or % of Appraisal revised appraisal KEY PROJECT DATA estimate estimate estimate Total Cost (US$ million) a/ 29.9 31.5 105 Total Cost (MF million) a7 14,646 12,208 83 Credit amount (US$ million) 15.0 Negotiations 10/3-6/77 Board approval date 11/29/77 Signing date 12/08/77 Effectiveness date 05/15/78 Completion date of physical components 12/81 08/81 Proportion completed by above date 100 100 Area distributed to farmers (ha) 38,300 30,700 80 No. of direct beneficiaries (families) 13,000 12,600 97 Economic rate of return (%) 18 3 Financial performance good poor Institutional performance good Borrower poor Bank poor CUMULATIVE DISBURSEMENTS FY79 FY80 FY81 FY82 FY83 FY84 FY85 Appraisal estimate (US$ million) 1.2 4.4 8.7 12.7 14.5 15.0 Actual (US$ million) 2.9 7.2 11.0 14.2 14.4 14.5 14.7 Actual as % of estimate 242 164 126 112 100 97 98 Date of latest disbursement 7/30/85 Closing date 6/30/85 Undisbuzsed amount (US$) 64,000 Principal repaid to date none a/ The difference between project cost expressed in US$ and MF is due to the devaluatinn of the US$ with respect to the MF during early years of project developmenit.  - iii - MISSION DATA Types Responsi- m.d. in Compo- Project Project of Mission bility Date field sition perf. trend Problems Identification RMWA 11/74 n.a. n.a. - - Preparation IER 1975 n.a. n.a. - - Appraisal WAPAC 11/76 Supervision 1 WAPAC 11/78 10 a,b 1 - - Supervision 2 WAPAC 05/79 5 a 1 1 - Supervision 3 WAPAC 11/79 18 a,b,c 2 2 F,T Supervision 4 WAPAC 08/80 6 a 2 2 F,T Supervision 5 WAPAC 02/81 2 a 2 2 F,T Supervision 6 WAPAC 07/81 32 a,a 2 3 F,T Supervision 7 WAPAC 11/81 6 c n.a. n.a. n.a. Supervision 8 WAPAC 02/82 40 a,c,d 2 1 F,T Supervision 9 WAPAC 09/82 42 a,b,b,b,c,c,e 2 2 F,T Supervision 10 WAPAC 03/83 5 c 2 1 F,T Supervision 11 WAPAC 03/84 5 c 2 1 F,T Other Project Data Borrower: Government of Mali Executing Agency: Operation Riz Mopti Follow-on Projects: Mopti Area Dev. (Cr. 15'97-MLI), US$19.5m, approved 5/21/85 a Irrigation engineer b = Economist c = Agronomist d = Financial analyst e = Livestock specialist STAFF rWPUTS I, 1978 19D77 1978 1979 1980 1981 1982 1983 1984 1986 1988 Total Preappraisaf 16.3 3.9 27.1 .7 . . . . . . . . 47.0 Appraisal . . 39.1 3.2 . . . . . . . . 42.2 Negotiation . . . 11.1 . . . . . . . . 11.1 Supervision . . . 7.3 7.8 11.3 10.3 24.8 7.9 6.1 6.5 6.2 84.8 Other . . 1.1 .4 24.8 . . . . 1.2 Total 16.3 3.9 $7.2 22.2 7.3 11.3 10.4 24.8 7.9 6.1 b.5 S.2 18B.2  - iv - MALI MOPTI II RICE PROJECT (Credit 753-MLI) PROJECT COMPLETION REPORT EVALUATION SUMMARY 1. This was the second rice production project IDA financed in Mali. It was preceded by four credits for agriculture) the first of which was for rice production. The project was identified by the Bank's Regional Mission in West Africa (RMWA) in 1974 and prepared by the Institut d'Economie Rurale (IER) of the Ministry of Rural Development in Bamako. The appraisal fol- lowed in November 1976 and the credit was approved in November 1977. The project's objective was to affect at full development about 13,000 families (90,000-100,000 people) in an area with an incremental paddy production of about 34,000 tons in an area of low economic activity. The project centered on (a) construction of four polders (together h,800 ha), (b) improvement of polders developed under the first rice project (Credit 277-MLI), (c) deep ploughing of the newly developed polders and of 14,285 ha of polder, financed by Cr. 277-MLI, (d) construction of stores, workshops, offices, houses, and training centers, (e) acquisition of vehi- cles, machinery, equipment, and two ferries, (f) an applied research and a credit program, and (g) technical assistance. 3. The project was expected to begin in mid 1978 and to be completed by November 1983. However, the closing date had to be extended to June 30, 1985. Final disbursement was made in July 1985. Total project cost increased slightly, from US$29.9 million (appraisal) to US$31.5 million, mainly because of more expensive civil works which made up more than half of total project costs. 4. Project design was largely based on the experience of the previous rice production project (Cr. 277-MLI). This previous project had produced better than estimated results. With enough rainfall during three project years of five, a higher rice price than estiuated at appraisal, and a larger number of project beneficiaries than anticipated, its actual rate of return exceeded estimates. The Mopti II project was to (a) expand the areas flooded, (b) improve ORM's managerial capability, (c) _pgrade the efficiency of ORM's supporting services, and (d) introduce training. 5. While its civil works components progressed remarkably well, the project did not attain its production targets. Key problems--and therewith inadequate flooding of polders--were the droughts and the non-adherence to the recommended technical package (poor quality seed, inadequate equipment, failure to weed, farmers' attitude). An oversized and not always relevant agricultural extension program caused results at farm level to stay below  -v expectations. At appraisal the risk of abnormally dry years was under- estimated. Supervision missions did not pay sufficient attention to the technical package and to the financial situation, but gave disproportionate attention to civil works. 6. Lessons learned are of weight fov the follow-up project (Cr. 1597- MLI) for which the following agreements have been reached. (a) Water components. Controlled flooding is to be revised so that the flood probability increases to 95%. Polder rice cultivation would therefore decrease from 36,200 ha to 27,000 ha leaving about 9t00O ha to rainfed cultivation. Control of water levels will be improved by construction of additional dikes and canals; (b) Agricultural Credit will be administered by BNDA with ORM assis- tance. Loan transactions of farmers will be handled by BNDA only thus clearly separating them from water charges; (c) Farming practices and ORM's Extension Service. With more appropri- ate credit conditions, farmers will be better equipped to follow the recommended farming practices. Farmers will buy threshers to do their own threshing rather than having it done by ORM. ORM's extension component can be reduced as the project's technical aspects are fairly simple and because farmers have had continuous tutoring for fifteen years. (d) Marketing of paddy has been a loss for ORM, the only authorized buyer of the paddy produced by the project. ORM, under the follow- up project, will progressively liberalize paddy sales and have it on the free market system by the fifth year.  PROJECT COMPLETION REPORT MALI MOPTI II RICE PROJECT -(Credit 753-NLI) I. BACKGROUND A. General 1.01 The Mopti II Rice Project (Cr. 753-MLI) followed a first Mopti Rice Project (Cr. 277-MLI) appraised in April 1971, and is followed by a third project, the Mopti Area Development Project, approved on May 21, 1985, and effective since November 15, 1985. All three projects are based on the same concept: the cultivation of rice within polders under controlled flooding to reduce the risks inherent to cultivation under uncontrolled flood conditions, as traditionally practiced in the flood plains of the Niger river basin. The Mopti II Rice Project was the sixth IDA operation in the Malian agricultural sector. 1.02 This PCR is based on: (a) a "Rapport d'Execution" prepared by ORM, received in the Bank on April 4, 1985; (b) the series of supervision reports issued throughout project implementation; and (c) the findings of an appraisal mission (January 1983) for the Mopti Area Development project. The three rice-based operations in the Mopti region, together with the First Livestock Project (Cr. 538-MLI, of 1973), constitute in fact a series of interrelated actions and reactions. Thus, rather than reviewing the performance of Mopti II as an independent project, the approach of this PCR is to focus on the key elements which, throughout the evo,lution of the physical, agricultural and social conditions, have helped the Borrower and the Bank in making some progress toward the understanding of the complex process of development of the Mopti region. B. First Mopti Rice Project (Cr. 277-MLI) 1.03 The first Mopti Rice Project was implemented from 1972 to 1978. Main conponents were: (a) the construction of three new polders (about 13,000 ha) along the Niger and the Bani rivers; (b) the rehabilitation of five existing polders (about 18,000 ha); (c) land preparation (deep ploughing) on about 10,300 ha; (d) the construction of ancillary buildings (offices, workshops, storage, etc.) and acquisition of vehicle and farming equipment; (e) an applied research program, including a seed production farm; and (f) the provision of technical assistance to the Operation Riz Mopti (ORM), the project's executing agency. About 7,300 families were expected to benefit from the project. Project cost was estimated at appraisal at US$9.4 million, of which foreign financing amounted to US$7.6 million: an IDA credit of US$6.9 million and a grant equivalent to US$0.7 million from France's Fonds d'Aide et de Cooperation (PAC). A supplementary IDA credit of US$2.6 million was approved in 1975 to offset the effect of the dollar devaluation and to finance changes in project design and cost overruns. FAC also increased its contribution by US$0.5 million equivalent. 1.04 ORM prepared an Implementation Report, dated June 1978, on the basis of which the Western Africa Regional Office prepared a PCR dated December 1980. Further, on June 25, 1981, OED issued a Project Performance Audit Memorandum (report No. 3523) which concluded that, despite of shortcomings in certain areas, the controlled flood irrigation system  - 2 - offers benefits to a large number of farmers at low cost and does not require drastic changes of existing farming systems. 1.05 The two first years of the implementation period (1972-1978) were very dry and, in terms of total output, the results were disappointing; conversely, rainfall in years 1974-76 was acceptable and results were encouraging. The table below summarizes the evolution of production parameters expressed as percentage of appraisal estimates except for the ratio "harvested area/sown area" which refers to actual annual values. Harvested area/ Sown area Harvested area Yield a/ Production sown area