Bolivia - Agricultural Technology Development Project

D)ocument of The World Bank FOR OFICIAAL USE ONLY CA' 2 Z Z 0 ; Report No. 8979-BO STAFF APPRAISAL REPORT BOLIVIA AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECT FEBRUARY 15, 1991 Country Department III Latin America and the Caribbean Regional Office This document has a restricted distibution and may be used by recipients only in the performance of tbeir offical duties. Its contents may not otherwse be disclosed without World Bank authorization.  CURRENCY AND EOUIVALENCY UNITS Currency Unit - Boliviano (Be) Exchange Rate Effective July 31, 1990 US$1.00 - Bs 3.13 US$0.32 = Bo t.00 WEIGHTS AND MEASDURES Metric System ABBREVIATIONS AND AjRONYMS CIAT - Centro de Investigaci6on de Agricultura Tropical CIFP - Centro de Investigacion Fitogen6tica Pairumani CINMYT - Centro International de Nejoramiento de Malz y Trigo CIP - Centro Internacional de la Papa CNIEA - Consejo Nacional de Investigaci6n y Extension Agropecuaria COTESU - Swiss Fund for Technical Cooperation EMBRAPA - Empresa Brasileira de Pesquisa Agropecuaria GOB - Government of Bolivia IBTA - Instituto Boliviano de Tecnologia Agropecuaria IBTN - Instituto Boliviano de Tecnologia Nuclear ICA - Colombian Agricultural Institute IDB - Inter-American Development Bank MACA - Ministry of Agriculture and Campesino Affairs GOVERNMENT OF BOLIVIA FISCAL YEAR January 1 - December 31  FOR OFFICAL USE ONLY BOLIVIA AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECT STAFF APPRAISAL REPORT Table of Contents Pace No_. I. CREDIT AND PROJECT SUMMARY . . . . . . . . . . . . . . . . 1 II. THE AGRICULTURAL SECTOR . . . . . . . . . . . . . . . . . . 4 Structure and Performance . . . . . . . . . . . . . 5 Agricultural Development Policy . . . . . . . . . . . . . . 5 Agricultural Research and Extension in Bolivia . . . . . . . 6 IDA Strategies for the Agricultural Sector . . . . . . . . . 9 Project Strategy for Agricultural Research . . . . . . . . . 11 III. THE PROJECT.............. . . . . . . 13 Rationale for IDA Involvement in the Project . . . . . . . . 13 Objectives ....* 14 Project Components . 1 S . . . . . . . . . . . . 1s Detailed Project Description. . . . . . ... 16 The National Council for Agricultural Research and Extension . . . . . . . . . . . 16 The Bolivian Institute of Agricultural Technology . . . . . 17 Project Organization and Implementation . . . . . . . . . . 27 Project Costs . . . . . . . . ... . 28 Financing Plan . . . . . . . . . .. . . 29 Procurement . . . . . . . . . . . . . . . . . . . . . . . . 29 Disbursements . . . . . . . . . . . . . 30 Project Benefits and Justification . . . . . . . . . . . . . 30 Role of Women . . . . . . . . . . . . . 31 Environmental Impact . . . . . . . . . . . . . . . .. 31 Project Risks . ..... . . . . .. 32 IV. AGREEMENTS REACHED AND RECOMMENDATIONS . . . . .. . 32 This report is based on the findings of an appraisal mission which visited Bolivia in June/July 1990. The mission comprised Messrs. James H. Cock (Team Leader/Agriculturalist). Douglas Masterton (Consultant/Agronomist). Robert Etheredge (Consultant/Architect) and German Vargas (Consultant/ Institutional Specialist). Messrs. Matthew McMahon and Dirk van der Sluijs reviewed this report. 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 - Table of Contents Paae No. Table I - Project Cost Summary .......... ... . . 35 Table 2 - Summary Accounts by Year . . . . . . . .. * . . . . . 36 Table 3 - Summary Accounts Cost Summary. ............ 37 ANNEX 2 Table 1 - Field Research Staff by Program. & Year . . . . . . . . 38 Table 2 - Staff Positions at End of Project by Stations and Programs . . . . . . . . . . . . . . . . . . . . 39 Table 3 - Summry of Total IBTA Staff by Year . . . . . . . . . . 39a ,-NNx 3 General Organizational Chart ... . ... ............. ........ 40 AIfNN= 4 Table 1 -List of Proposed Positions .4.44444444444 41 Table 2 - Proposed Grade Structure & salaries . . . . . . . . . . 43 1UNNE 5 Degree Training Program . . . . . . . . . . . . . . . . . . . . . 44 ISTA Performance Indicators . . .* 444.44444* 4 45 ANNX 7 Program of IBTA Activities ... . . . . . . ............. ..... 49 ANNEX 8 Notes on the Working Paper . . . . . . . . . . . . . 50 AfIE 9 Selected Documents end Data Available in the Project File . . . . 51 AMU 10 The Cosmodity Program . . . . . . . . . . . . . . . . . . . . . . 52 Map: IBRD No. 22554  BOLIVIA AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECT I. CREDIT AND PROJECT SUMHARY Borrower: Government of Bolivia Executnag Aaenc:s The Consejo Nacional de Investigacion y Extension Agropecuaria (CNIEA), an agency of the Borrower, and the Instituto Boliviano de Tecnologia Agropecuaria (IBTA) Beneficiaries: The project focuses on the highlands where 802 of the population lives. Poverty is rife in the area among the target population of 2-3 million smallholder farmers, livestock producers and their families, who produce most of the staple food for the whole country, on small- or medium-sized farms with very low levels of productivity. Credit Amount: SDR 15.0 million (US$21.0 million equivalent) Terms: Standard, with 40 years maturity Cofinancina: US$3.5 million from the Swiss Fund for Technical Cooperation (COTESU) of Switzerland Project Objectives and DescriDtion: The proposed project would have two main objectives. Firstly, to improve the overall efficiency of research and extension and, secondly, to directly support tecnnology development in the highland agricultural sector. The project would establish a Consejo Nacional de Investigaci6n y Extensi6n Agropecuaria (CNIRA) to more effectively coordinate research and extension in the country as a whole. The project would also strengthen the national agricultural research agency, the Instituto Boliviano de Tecnologia Agropecuaria (IBTA), and focus its efforts on developing technology suitable for smallholders in the highlands. The new IBTA would be reorganized on the basis of commodity programs, and be charged with overall responsibility for developing agricultural production, processing and marketing technology, and for demonstrating its technical, economic and social viability within the constraints of the rural conditions. The commodities to be researched would be: potato, cameloids, sheep and forage, maize, small grains, grain legumes (Faba beans and peas), and quinoa. The project would be implemented over seven years. The IDA credit would finance 702 (US$21 million) of incremental project costs during the period. Bilateral financing from Switzerland's Technical Cooperation program (COTESU) would provide US$3.5 million and the Government of Bolivia would finance the balance of US$5.3  - 2 - million (182 of project costs). Government would be required to maintain a ratio between personnel costs and recurrent operational costs of about 65:35 to ensure adequate operational funds for effective research. Governme.t would assume an increasing share of the total recurrent costs as the project proceeds increasing from 10% in Year 4 and reaching 652 by Year .. Support would be provided fort (i) commodity research programs; (ii) staffing; (iii) training of research and administrative staff; (iv) renovation of existing infrastructure plus limited additions; (v) vehicles and equipment; (vi) technical assistance; (vii) studies into ways of meeting long-term extension and research needs; (viii) improved administration and personnel management; (ix) a mid-term evaluation of the project including a review of mechanisms for obtaining stability of funding for IBTA; (x) subcontracting of specialized research to other agencies; and (xi) establishment of CNIEA and implementation of its program. Project Benefits: The project risks can be divided into those normally associated with research projects and those specific to this case. In the case of the former, the basket of programs in the project spreads the normal risk that individual research programs may not reach their planned goals. Furthermore, the planning and evaluation processes built into the project design would allow a flexible approach to resolving unexpected problems in the development of technology. One of the common failings of agricultural research programs is that they produce technological packages that are technically sound but that are not socially or economically viable in the environment of the producers, processors, marketing agents or consumers. The pilot project approach to technology testing and adaptation under the project is geared to avoiding this problem. A further risk is that of the transfer process not being effective. The project includes a special study of the technology transfer process which should provide recommendations on how this can be improved as a basis for a follow-up project. In addition, the pilot approach to technology testing would involve technology transfer and should give insights into deficiencies in the process that need to be corrected. A major uncertainty in this project is the capacity of IBTA and the CNIEA to execute and manage a program of this magnitude. The project provides for technical assistance and funding to allow for a twinning arrangement, with an experienced national agricultural institution. Moreover, the project actually involves a reduction in the scope of IBTA's activities, a reduction in its personnel and in the number of research stations.  3- This in itself may be politically onerous to achieve and considerable political commitment would be required to carry out these measures. However, already staff numbers have been substantially reduced. Proiect Costs Local Forejgn Total --(US$ Millions)------------ Training 0.34 2.20 2.54 Tecenical Assistance 0.43 2.96 3.39 Infrastructure 0.79 0.40 1.19 Equipment & Vehicles 0.42 2.43 2.84 Other Investment Costs 0.37 0.33 0.71 Personnel and Operations 10.10 3.60 13.70 Total Base Costs 12.45 11.92 24.37 Physical Contingencies 0.17 0.30 0.46 Price Contingencies 3.22 1.71 4.93 TOTAL 15.84 13.93 29.76 Financinft Plan Government of Bolivia 5.3 -- 5.3 COTESU 2.6 .9 3.5 IDA 8.0 13.0 21.0 TOTAL 15.9 13.9 29.8 Estimated Disbursements 1991 1992 1993 1994 1995 1996 1997 1988 Annual 0.8 2.3 2.7 3.4 3.4 3.4 3.6 1.4 Cumulative 0.8 3.1 5.8 9.2 12.6 16.0 19.6 21.0 Economic Rate of Return: Not applicable. IBRD Map No. 22554  - 4 - II. THE AGRICULTURAL SECTOR Structure and Performance 2.01 Bolivia hae a population estimated at approximately 7 million. The country covers an area of 1,098,581 k12. The three major ecological regions are the Altiplano in the couthwest, the Vallee and Yungas of the mountainous chain running from the central western area to the central south and the eastern plains of the Chaco and Beni. The Altiplano is a highland plain with an average altitude of 3700 m and average temperatures of 10