Rwanda - Food Security and Social Action Project

Docum_M of The World Bank FOR OFFICLAL USE ONLY MICROFICHE COPv Report No. P- 5727-RW Type: (PM) RIqiNIL P-5727-RW BAUDOUY, JI X34015 / J7 047/ AF3PH MEMORANDUM AND RECONMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT OF SDR 14.0 MILLION TO THE REPUBLIC OF RWANDA FOR A FOOD SECURITY AND SOCIAL ACTION PROJECT MAY 27, 1992 This documean has a restricted distribution and may be used by recipients only in the performance of their official duties. Its conents may not otherwise he disclosed without World Dank authorization.  N TSUEUALENTS (as of January 1992) Currency Unit Rwandese Franc (FRW) US$1.00 FRW 120 GOVERNUM E, MAMA-- FIS,CAI,, January lst - December 31st EEIGHLAND MEASURES Metric System AMMBMUATIQNS AGSAC Agriculua Sector Adjustment Credit ADS Acquired Immunw-Deficiency Syndrome BCP BureaudeCoordinationdu PNAS (PNAS Coordinaton Office) FINSAC Financial Sectr Adjustment Credit GNFS Goods and Non Factor Services IDP Institutional Development Fund ILO Interational Labor Office LDWs Labor-Based Works LlR Liberal Iport Regime NGO Non Govnmental Organization OGL Open General License PE Public Enterprise PEP Public Expenditre Program PER Public Expditure Review PPP Policy Framework Paper PNAS Propramme National d'Action Sociale (National Social Action Program) UNDP United Nations Development Program WFP World Food Program  FOR OMCIL USE ONLY RWANDA EOOD SECIM=I A,SD SOCIAL ACI1O EMJECr CREDIT AND QM SUMAR Borrower: Republic of Rwanda * INeneficiaries: Not applicable DM&tAnn4. SDR 14.0 million (JS$19.1 million) Tems: Standard IDA terms, with 40 years maturity Not appl - ble Percentage Total NACMAN Loal lowcostrn ICo (US$ million) IDA 12.5 6.6 19.1 42 UNDP 1.0 2.1 3.1 8 WFP 8.9 7.0 15.9 33 Goverment *8.0 - 8.0 17 TOTAL 30.4 15.7 **"46.1 * Part of goverment's contrbution will be covered by the Unified Countpat Fund (pool of counterpart fnds ad ted by the Treasuy) and by the Unified Road Fund (managed by the Ministry of Public Works) for communal road maintenace. *Excluding US$2.5 milion equivalent for taxes and US$0.86 million equivalent for import duties. Enomic aB of Retu Not applicable Staff &Maw Report No. 10373-RW Me: IJBRD No. 23684 This document has a restricted distribution and may be used by recipients only in the performance of their oMcial duties. Its contents may not otherwise be disclosed without World Bank authorization.  MEMORANDUM AND RECOMMEATION OF TME RIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUtIVE DIRECTORS ON A PROPOSED CRUDIT TO THE REPUBUC OF RWANDA FOR A FOOD SECURITY AND SOCIAL ACTION PROJECr 1. I submit for your approval the following memorandum and recommedon on a proposed development cet to Rwanda for SDR 14.0 mIllon (UJS$19.1 miion eq aet). Te proposed credit woud be on standard IDA terms, with 40 years maturi and would help finance targeted food security and social programs in Rwanda. The project would be co-fmnced with WFP (US$15.9 million), and UNDP (UIS$3.1 million). Part I of this report discusses the country's polcy and the Bans assitn strategy. Part describes te social st, he Food Seci and Soci con Project and the prposed 11DA credit. MIR I - COVN PlICI1S-ND BNANK GROUPE ASfLANCE SITGY 2. Rwanda is a small landlocked couty in Central Africa. Its per capita GNP was about US$310 in 1990. The expoitation of the country's scarce naual reouces Wluding arable land) is by its mountainous terrain and he log distnces to the nearest sea ports. With 7.3 miUion inhabitants, Rwanda is the most densely popated country of Africa (280 Inbitants per square kilometer) and has one of the world's fastest demographic growth rates (currently 3.6 percent per annum). he contry is populated by two main ethnic groups (Hutus, the majority group, which re about 85 percent of tie pqpulation, ad the minority TIts18 who were poliically dominant befoe . Edmic conaicts led to a major exle of Tutds in 1959, befoe independence in 1962. Since then, only minor dents ot etnic violence had occurred until exed Tusis invaded Rwanda in October 1990. Althodh the Govermnt was able to reped the iWas, sporadic fight has conted. Rwanda's social indicators, Which used to be above the sub-alaaran Africa averages, have lipped in recent years and are now on a par with the rest of the coDnt Life expectay is only 49 years; 53 percent of the popuaio Is ilteate.; and infant moraity Is 119 per thous The AIDS eidemic is one of the worstin the world; malaria spreading; and _imatron is pervae. 3. Rwanda is a p m ntly r socy. Neady 93 percent of fte population lives in rua aeas and derves its livelihood from subsitc agriculture and the cultivation of coffee and tea for export. Agriculture accounts for about 40 percent of GDP ad for the employmnt of some 90 percen of the ve labor foce. Coffee and tea accout for 80 percet of the country's export earnings. Apart from some agro-industriD activities, the industrid sector is small and InefficienLt. After years of contaton of output, the mining of tin, e principal minral resource, vily stopped in 1987, in part becam of the uncompe exchae rate. Public and mixed enterprises play a key role in the economy; transport, marketing and export of coffee, tea and pyretm are all managed by public entewprises. Local etrene ip is not well developed, except for a smal but dynamic informal m*o sector. In addIti the physical constraints, te major obstaes to privae sector development are the presence of the state as a privileged cometor and a disabling environment carceied by an hAquate Icentive system and pervaigovenm intfer in vhtually al apects of economic life.  -2- 4. Rwanda is heavily dependent on foreig assistance. In recent years, external assistance financed about 60 percent of imports and 90 percent of public investmet, and was equivalent to about US$30 per annum per capita; It conisted mainly of grants, of which about half was for tewchil assistance. Rwanda has had a reputation amongst donors of bein a relatively well-managed country: its people and administon are hard working; civil servants are generally competent and disdharge their duties conscientiously; corruption is not a major Issue; the road system is excellent by sub-Saharan African standards; and telephones and other public utlities function well. 5. President Habyarimana came to power in 1973 through a military coup and proclaimed a one-party state. The new regime followed a benevolent patrDistic approach in relation to the rurai population thrugh pricing policy, investment and the development of basic services in the rural areas. At the same time,.the authorites mantne strong contol on rurl migration, enforced madatory cultivation of ceain crops-coffee in particular-and have mobilized the population for compulsory community labor ('Umuganda') for road improvements, tree planting and soil conservation. The result has been a higly regimented society in which, up to very recenly, private initiative was limited. 6. In July 1990, responding to mountng domestic and eternal pressure, the authorities initiated a political reform proess. Following the invasion of the country by Tutsi rebds in October 1990, the authoritis ac-elerated the political reforms. In June 1991, a new constiton was adopted and in October 1991 political parties were legalized. In April 1992 a transitional coalition Govenment was formed, headed by a Prime nistr from one of the five opposition parties preentd in the new cabbinet The new Government has confirmed its support of the adjustment process and has undertaken a diplomatic initiative to find a negotiated solution to the ongoing conflict with the Tutsi rebels. New pariamentary and presidenti elections are expected to take place within the next 12 months. D. AonomIt Pold ndeafonanm 7. In the 1960s and 1970s, Rwanda pursued prudent finacial policies. This, coupled with generous external aid, resulted In sustained growth in per capita income, low inflation rates and one of the lowest levels of exteral indebtedness in Africa. However, in the 1980s, the authorities responded to the shap fall of world coffee prices by Increasing controls over the ewcnomy instead of adjustng to the new external enironent and maintai the competIiveness of the economy. The sharp decline in per capite income asciated with the terms-of-trade deterioration was compounded by the iappropriate interventonst policy response, which led to an adverse envioment for the effcient use of resources and discouraged the development of private sector actvity.  -3 - Table 1: Selected Uconomic Indcat( a 1980-85 198689 199 1221 (a) GR04TH RATES tb) GDP market prfee 2.9 -0.2 -1.2 -2.9 Export volume (GNFS) 2.4 -2.3 31.2 -8.5 Import volume CG&NFS) 6.9 -5.8 -9.3 -1.8 RATIOS (MZ cc) Debt Servcee/Exports tG&RFS) 4.7 7.5 17.4 20.4 Gross Investment/GDP 16.1 1.3 11.6 13.2 Gross Domestic Savings/1OP 4.2 8.2 2.8 -0.5 Pubitc Saviisw/GDp 3.0 2.2 -4.9 -12.6 6overnient Revenue/auP {d) 12.4 12.2 12.2 13.2 Government Expenditure/GOP Cd) 11.6 18.7 24.7 28.0 Overall Budget Deffcit/GOP Cd) 0.8 -6.5 -12.5 -14.8 Current Account/GDP Ce) -13.4 -10.3 -11.1 -13.0 INDICES Cansumer Prices (growth rate) t.7 1.7 9.1 15.0 Terms of Trade (1987-400) 110 135 83 95 Real Effective Exchange Rate (1987a100) 74.7 109.7 90.4 57.0 (a) Preliminary estimates. (b) Based on 1985 prices. (c) Based on current prices. cd) Excluding grants. (e) Excluding official transfers. S. In ealy 1990, after a ptacted dialogue with the Bretton Woods intutions, the Government decided to brek with past interventionist policies and, with the help of the Bank and Fund, embarked on an adjustmn program. Ihe Govenment's adjustment program was described in its frst Policy Framework Paper (PFP) for 1991-93, which was dbcussed by the Committee of the Whole in April 1991. In late 1990 (in the midst of the Tutsi exiles' invasion) the authorities implemented 'up front" some of the most important and politically difficult measures of the program: (i) the Rwandese fanc was deaued by 40 pernt in SDR tems (67 percent in local currency terms); (ii) the mimum interest rate on one-year deposits was increased from 6 to 12 percent and the maxinum lendig rate from 12 to 19 percent, all oiher deposit interest rates were freed, and a unified rediscount rate of 14 percent was duced; I4) petroleum prices were raised by 79 pert on average, in order to pass through to the consumer the full impact of the devaluation, briig the price of gasoline to the equivalent of US$3.80 per galon; (iv) as partofatariff reform, inimum Importduties were set at 10 percent; and (v)the sales tax was almost doubled, to an average of about 10 percent. 9. In 1991, despite the continued clashes with the rebels and a difficult inter political situation, the Govenment continued the implementation of the adjustment program which was supported by an arrngement under the IM's Structural Adjustme Faclity (SAP, approved in Aprfl 1991), an IDA- financed Strucual Adjustment Credit (SAC) of $90 million approved in June 1991, and substantial balance of payments assistance by other donors, which was mobilized at a donors' meeting organized by the Bank. Specificaly, the anorities implemented the following key measues under the program: (i) an inia liberalk-Ation of the foreign examge allocation system wkh the establishment of a Liberal Import Rgime (LI) covering 70 percent of imports of goods; (i) elimination of all export taxes, except for coffee; (iii) elimination of import proitions for protective pupose and import quotas; Civ) adoption  -4 - of a new simplffled import tarff strucure by reducing the number of Import tarff rates from 14 (ranging from 0 to 220 percent) in 1990 to 5 ratm (rangilg from 1to 0 100 percent) In 1991; (v) abolition of controls on profit margins and on prices (except for monopolies, a few basic commodities such as petroleum products and icals, and hellth services); (vi) el_miton of the legislation rering governent approval for the cio n of priv business and (vil) a 50 percent increase In water and electricity tariffs. 10. Contued deprWessed world coffee prices and sporadic clashes with the Tutsi refugees caused severe economic disruptions which led to a 1.2 percent decline in GDP in 1990 and a frther decline of 2.9 percent in 1991. The sectors most severely affected have been m uring, port, trade, and tourism Internal commerce has been lagely dirupted by the security measures and roadblodcs intoduced to prevnt infltrtion by the rebels; and a large proportion of external trade has had to be re- ued away from the northeastern corridor - the region where most of the fightig has been taing place - with a resulting inre in costs. The budget deficit cluding capital grants) reached 10.3 percent of GDP in 1990 and 11.8 percent in 1991 (12.5 percent and 14.8 percent, respecdvely, when capital grants are excluded). The deterioration of the fiscal situation was due primarily to the rapid expansion of military outlays, which reached 4.5 percent of GDP in 1990 and 7 percent in 1991 (compared to about 2 percent on average during the precedwg ten years). As a resut, the share of development expendiure in the budget declined from about 90 percent in 1989 to 75 percent ia 1991. The social 'sety net' which had been inorporated in the adjustment program was adversely affected (e.g., spending for medicines was only 25 percent of the budgeted alocatlon). nflation (annual average) increased to 9 percent in 1990 and 15 percent in 1991 (due to the devaluation), although it decelerated towards the end of 1991 to about 10 percent and is eWpected to decline further in 1992. 11. The balance of payments was aso negatively affected. Export eanins declied by an estmated 6.7 percen in 1991, mainly reflecting unfvorable developments in the coffee sector and sluggish exports in other sectots, with the excepdon of tea. Merchandise imports increased by an estmated 2.1 percent in 1991, mainly due to an increase in military imports. Consequendy, the current account deficit increased from 11.1 percent of GDP in 1990 to an estimated 13 percent of GDP in 1991. However, net reserves were rebuilt in 1991 to the equivalent of 3.8 months of imports, from virtually zero at end-1990. 12. The frst PFP assmed an early return to peace, and the macroeonomic faework was ibrmulated accordingly. That key assumpon, however, proved optimisdc as the armed conflict has conned. As a coneqence, althugh the Governent implemeted he other adjus_tm measres agreed in the context of the SAC and the SAE, becase of higher military expediture and lower revenue from the recession, in 1991 the overall fiscal defici was higher an the target; essenial cvilim spending was compressed; and domestic arre accumulated. The macro-nomic framework requires rormulation to achieve maximum feasible adjustment under the curent county circ nc. Specifically, the objective shoud be to resume growth and graduaiy reduce fiscal deficit, while icreasing developme expenditur, including on the social afety net. Bank and Fund staff have collaborated closely to define the broad parameters of a realisdc macro-economic frmework Bank and Fund missions are ex ed to visit Rwanda shordy to work with the Rwandese authotes on the reformulation of revised maco-economic frameworlk  C. CAutaLnuloDz1aztJm 1. Mm Ink Ahead 13. Rwanda Is at a rossroads. It Is faced w the managm of two transitio-political and economic-while coping with an amed oflict tht s diuptg eonomic actvity and draining scace resources. On the political t, the challenge is to coniue progress towards politcal pluralism while ethnic recoiliation and finding a negotated solution to the fighting. The economic chale is bto get the country back on th path to sustainable growth and to reverse the socia deiotion resulting from the recent economic decline and rapid p ion growth. 14. To resm growth, th Govemment needs to purue the adjustm agenda and to pursue, specifically, fur inrrelatd gena objecdves: (I) pvae setor-based economic growth and exp growth and diversificion; Qi) reduced role of the state and impoved public sector mahiagement, in g a reduction in non-developmet expenditure; (di) development of human resources (including aievement of demographic and poverty alleviadon goas); and (iv) impred management of natural reources. 2. EQs Privas & -13co5 Grh and 15. Susted ecotsomic gowth in Rwanda requires di ficaon and tronger export-orietaton. Becas there is alost no unused arable lnd left, agrlcultd growth must rely on inceased yields and higher prod qulit. Incresed production and employment can come also from labor-intensive export- oent industry. The technogical and managerial requiments of this shift t new exports can only be asued by the private sector. Accordingly, the Govment has decided to give the highest priority to empl a gprvae sectorased growth-promoting stratwegy. 16. In order to e ce extn competess, buiding on the reforns of 1990-91 and in addition to mintining a competive exchag rate, the Govenment is commed to tablising in 1992 a on- discrimnato forei4n eang allocation regime through an Open General License (OGL) system by commercial banks. In the tariff reform area, the next steps are to lower nominal and effective protect further by reducing the tariff range t 10 to 80 percent in 1992 and to 10 to 60 percet in 1993. The long-term objective shld be to sduce the range to 10 to 40 percent In addition, the government has undertaken a refom of the regulatory framework encompassig the reform of the labor code and the legal famwork in which busineses operate. 3- te b* of the S3a. ldmving bliR 17. To allow the private sector room to develop, the state needs to redefie its role in the economy, away from i and conrol and tward the promotion of pe initiative and invesem In the longterm, the ibi of growth will depnd largely on the Govmetms ability to mobilize domestic savigs. In the m the priories are to: () refrm and reduce the public enterprise (P) sector; (a) Imrove the composon of public ex tre; and (iii) increase the efficiency of public resource management. 18. Concerning PR reform, a new institutional and legal framework has been daborated for Pes, to increas their autonomy and and improe their efficiency fthrough divestitre and ludation of non-viable Peas. An action plan cwveng 40 enterprises I dr impl n and supported by an IDA-financed Public Enterprise Refim Project approved in FY90. Furnhmore,  -6- publicly owned agro-industties are being testructured and opened up for private sector participation in the framework of a proposed agriculr sector adjusument operation, currently under preparation. 19. Concerning the composition of public spending, the objecive is to increase the share of outlays for development activities. As mentioned earlier, the share of development expenditures in total public expenditures declined from about 90 percent in 1989 to about 75 percent in 1991. increases are justified and urgently needed in some categories, especially the social *safety net' established in the framework of the stctural adjustm progm Another priority is operation and maitenance, which is crucial for the producivity of the infastructure investments made in the 1970s and 1980s and the quality of public services. 20. Concerning the efficiency of public resource management, the Government has adopted a three- year 'rolling" pubiic investment programming system incorporating economic slectdon criteria. The 1992-94 public investment program, which has been reviewed by the Bank in collaboration with major donors, represents substantial progress o-ver previous investment programs, but fSuther progress is needed. In particular, monitoring of financial and physical project execudon is itill weaL in adfition, a rapid and orderly resolution oi the problem of domestic arrear is required in order to restore Rwandas good record of day-to-day economic management. 4. Developng Huma Resuces and Alleviaidng Poxcay 21. The most formidabie long-term issue facing Rwanda is its high ppulWi ngrowth: at the present 3.6 percent amnual growth rate, Rwandas populaon wil double in about 20 years. Ihe demogrwhic momentum is such that Rwandaes population is bound to contue to increase rapidiy before any fahdily planning measures can make a diference. Given its limited resources and employment opportunities, Rwanda could face soci unrest and growing extern tensions with neighboring countries unable or unwilling to absorb large numbers of inmigrans. The environental implications of rapid popuaion growth in an already densely-setled county--discussed in the next section-are also serious. Ia 1990, the Government adopted a populaon policy seting a very ambitious target of reducing the rate of population growth to 2 percent by the year 2000, and is developing programs in famly plannig. The Bank is supporting these efforts through the ongoing Pamily Health project and a Population project approved respecdvely in FY86 and FY91, which will improve the quality and efficiency of fmnily planning services delivered in public health centers. 22. HdA stdards deteriorated over the last decade due to a combination of under-funded public health prgms and a worsening health environment. Two major public health hazards have emerged in the 1980s and are causing severe human and economic losses: malaria, with an eight-fold increase in the mber of cases reported in the last decade; and AIDS, with an estimated 25 percent of adults between the ages of 15 and 45 living in urban areas testing seropositive. In addiWon, food insecurity and malnutrition have increased largely because of the population pressure. Concening euwciQon, over the last five years, the primary enrollment rate about doubled, to 62 percent, but the quality of primary education declined as the number of qualified teachers and the provision of educational materals did not grow in proportion. Unless a major effort is made to ince the educadon budget and improve the efficiency of the education stystem, the quality of primary education wfll further deteriorate and enrollment rates will decline to 50 percent by the year 2000. The governmmet began addring these issues in 1991 by initiaing an education reform - primary schooling was reduced from 8 to 6 years. The Bank is suppordng this reform through the ongoing education sector project approved in FY91. 23. Wmei represent about 60 percent of agricultur labor and produce most of the food crops in addidon to collectng fuelwood, fetching water, cookig and caring for childraL The key elements of  -7- the GovemntWs sategy concerning women we: O) expansion of girls' access to education; (i) exhancement of Wome' acces to headth SW ; (11 empowerment to decde on the size of thirk family; and (iv) targetin of women In poverty-oriented micro proJec in rura areas. 24. Since 93 percent of the populion lives In rura areas, VW= in Rwanda s overwhedmingly a rai phenomenon. The farm size has been reduced to a poit where the stin of family frms b thretened; morever, food productin has aggWd behind p owth. As a resul, food yIecurity has become praent In the southern and wstern part of the country. The Government's strategy to allviate poverty ftroug the resmption of rapid economic growth, fas employment creation, and social progams targeted towards the poorest segments of tie population. Agricuural diversification and the deveopment of labor intesive export-orited Idustries would create additional jobs and cotribute to food secrity by geng forign excage eanigs to fince neoded Impots of foodsuff. There i also a need to ensure ta basic soci services are protected, while the fisca deficit is reduced to sustainable level. Accordigly, the Goverment has built a soci 'saety net Inlto its public expdiU progrm. The Government has pred a targeted social action program, which is suppored by the operation recommened in this repor S. Imodw fth a^et o Nal Rlesources 25. Enviroment degadation is a major development Issue In Rwanda. Over the past two decades, forest cover has shrnmk by 25 percent, while the Incre cultvation of margin land has led to a reduction of pasture land. Ihe most Immediate enviroment concerns include: soil erosion and inftlity, war quaity degrdation, and destrucdon of forests for fuelwood. 26. Rwauda has a long-stani commitmn to environmenta protection and is making a serious effort to defe mac-eonomic and sectoral development strategies COistent with this commitment 'his was recognized by the Smitsonian Insttuton which awarded Rwanda a prize for eiomenta prtctionIn meary 1992. The legal framework for envr_onme planning and management is largely in place. In May 1991, thfe Governmen adopted an Envoment Strateg and an Action Plan, which was paed with Bank assistance. This plan is being tranated into indid projects for etea g.~~~D . ~~~~~D. NWmi-erm geetsan EanQ RNWAts 27. The macro-economic framework of the first PFP wvas deeloped in early 1991 and was built on the assumption that there would be a rapid cessation of hostides, a scenario which appeared plausible at the time. In fact, although a cease-fire was sigped In March 1991, the armed conflict has conued, disrupng econmic activity and cnumig scarce resources. Positive per capita growth unlikely in the near future; the prospec for private invesmt in the short-term are also bleak; and a quick and substanta reduction I the fisca deficit would not be realistic under the prevailiw circ . In light of ongoing war and adverse terms of trade, Bank staff prepaed revised economic projections for Rwanda. These projectons assume that (i) the recent politia opening will bring a quick end to hostilifies; and (H) an early agreement wil be reached between the Govarmen and the Bretton Woods istiut on a new macro-onomic framework and a second PFP for 1992-94, which would serve as a basis for continued balance of payme support 28. The key targets of these teatve projections are to: O) reach a 4 percent annual GDP growth rate by 1995; (U) limit inflation to 4 perzA per am; and (iii) reduce the fiscal deficit (excluding grants) from 14.5 percent of GZ)r :a 1991 to aound 9 pert of GD)P in 1995. Under this scenario, gr  8 - investme wi ncrae from 13.2 percent of GDP lia 1991 to 15 pecet 1995, with the share of privatoe Invaent growing from 4.1 peco of GDP in 1991 to about 5 prcent In 1995. Domestic saving ar etimated to increase from 2 percent of GDP in 1991 to over 6 percent over the same period. Only a modest Improvemeat is expected In th trade balace as eport re expeceted to continue to be afected by the depressed level of world coffee prices, and only modest increes are projected In export of tea and ming products. Chian Imports would Ibn ov th period as the economy recovers from Its dersed level and the ratio of expor to Impor of goods Ii projected to inca from 42 perct in 1991 fo 44 percen in 1995. The cuT acon deict would dedine from 12 perce of GDP in 1991 to 10 percent of GDP in 1995. Rwaas external debt is almost certain to remain sma as the govemment is expected to continue to rdy exclusively on gra and higly concesslonal credit. The debt svice ratio is projected to increase from 20.4 percent I 1991 to about 24 perceft in 1995 and to dece gradually thereafter. 29. Achieving these objectives would depend not only on the condtned implemtation of the adjustment program, but alo on the timely avalablitiy of adequae external fhiuncing. Exter capital requ ireiens for 1993-95 are tentatively projected to total US$940 million (US$314 million per year on average). This assumes, among other things, a firther reconsution of net reserves to the equivalent of abut four months of GNFS hIport by end-1993 - an eenta fianlal cusion to underpin fuil iprt liberaizatioand econoic recovery. Gr arZeprojectod atUS$327 millon; grossprojectlendingfrom current commimen at US$192 million (of which US$92 million from IDA projects); and disbum from new projects at US$189 mililon. These projections yield an inlitial g of US$233 millon for 1993- 95. Of this, US$77 million would be financed by IDA credb for structural and sector adjustment, and US$12 million by the IMP SAP. The resdual gap of US$144 million would be filled by additonal assistance in the framework of the Specia Progrm of Awssa for Africa. These projections will be firmed up ia the context of the next PFP. IL Ihnk st A _m &MM 1. EBffwvene gaukt Ba ance 30. ank rWD ogr. Since 1970, Rwanda has received 43 IDA credit totalling US$612.4 million, and two Speci Afiam Facility crets (US$25 million). IPC has financed three loa nd two equity participa. To date, VDA commitment have financed: (a) hInraucture development (36.8 pern), padculary road constrctio and (mb) agricultural and rural developmet (22.7 percent), with strong emphasis on fming sym research, exteMion servc improvement, input supply, and reforestaton; (c) sttal adjumt (14.7 percent); (d) human resources development (14.3 perce), esecay primary educain, preventive health care svices, nd famfly planing; (e) development of sma and medium cepris (6 percet); (t) dwevpmen of local ener sources and energy conservain (3.9 percent); and (g) technicd a ce (1.6 percet).  .9- Table 2 mwh: Distributfmn of Ldr, F17WI Qi_ttim) Nuber of 8ector AMPe Mralects Infrastructure 5 Roe' TO. tranport 40.0 6.5 1 Trtecmm.tcattcga 20.3 3.3 2 Urban 32.0 5.2 1 Vtotr Suppty 28.0 4.6 2 Aericutture ii. E 1 Agriculture 103.8 16.9 9 Forestry 35.1 5.? 2 HnUM Resources ELI ,A, .f Eicatien T.0 9.3 4 Health 10.8 1.S I PoptLation 19.6 3.2 1 Energy LD 19 Flnu Indatry ard PutfLc Entopsse R.fo.t fE A Frnanckdtry 25.2 4.1 4 Pubtc Enterprise Reform 11.8 1.9 2 Structural Adjutt ent.0 Teohnical Assfstance LI M I 612.4 100.0 43 31. 1ffectivenmes of _go. Mhm Banlkes progrm has bee pursed In a climate of genry good relatioDs wi the ovme In all sectors in which the Bank Is active, the Govermet has generMy been receptive to the Bans advice on macro and setoral development issues. The aurent potko cludes 19 IMA Credits. TMm disbuemen rate has bee slow, aveaig about 8 perct of the outding portfoflio in FY88 (compad to 1 perce for subSaha Africa), and has d rted shaply in FY90-91 to an avea of 4.5 percent of portfolio, largely as a result of the armed hostities and conut h ity. Curreny, about one half of tota comm remain undisbsed. Te following implan ssues have bee identfied: weak management and nttuto; lengtLy ratification procedures whih dey the effecdveness of credts; cmberome prouemen procedure; and ipopria budgey practices for counterp inds. Ihe counepr fiunig problem shoud be bstan y resolved following an agree_m wfit donors in Februny I992 in the conte of the latest PuibUc Epetu Rview (PER) to pool aU c tp funds In support of a core expe program. i agreement, the first Ite fmework of the SPA, elhmia specific earmarng and, in addition to fcliatng project execudon across the board, consttes a major step for the improvement of publc resource managment, which is a key Bank asistan priority. Also, the reen impovement in the programming of public Investment shold help accelate the disbueme rate for all project. Finally, buildig partdy on tie June 1990 semia In Kigali organized to familiarze resposible ciil sent with Bank proCUment and dpbucd p ur, the Bank will conduct its firt Country ImplemeIaioni Review in FY9  - 10- 2. e 32. The Bank's main objective In Rwanda is to help promote sustained export-led growth with equity, to tackle, directly, poverty and deterioratg social coAditions and tO protect the eviroanent. lbrough its policy advice, leng, economic and secor work, and aid coordinaon, the Bank Is giving priority to: (i) supportig the counts adjumt process; i) developing an ncentive structue geared at pmotn epart-ient privat sector Investmt; Qii) reducing the role of the st d improving public resource management; (v) developing human resources, building local capacity, alleviatg wide- spread poverty, and reducing populaton gowth; and (v) fsering improved magement of natural resources. 33. L1n. Assuming early agrennent on a revised macroaeconomic fmework and its successful implentatdon over the medium term, the proposed IDA lening program would average three to four opratons a year. The proposed strag implies an annual per capita lend of about US$11 through FY95 compared to about US$8 in FY87-91. The share of quick-disbursing support to tal lending is expected to be in the 35-40 percent range, reflecdng the financial needs of a country at the outset of the adjustment process. Ihe size and composition of the lendig program would depend on the Government's progress on adjustment, povety alleviation, protecting the enviroment and increasing the disbursemet rate of IDA-financed projects. 34. lb-dwo= M T Ihe Bank plans to spport the adjustnt process beyond the ongoing fir SAC with tr adjustnt operations. The immediate priority Is to deepen the adjusstme reforms dtrough the prposed Fmancial Sector Adjusten CredK, FINSAC-already negoited and Agricultura Sector Adjustmet Cit, AGSAC-already appraised. Ihe opatons, together with the fist SAC, suort the first phase of the Government's adjustnent program and are key to creating an appropriate business envwnment to foster economic recovery and to successfilly implement ongoing investment projects. The FINSAC woud promote private sector development by supporting a more efficient financi n system; and the AGSAC would support a seies of reforms aimed at moving the cWcal agricut sector away from a heavily rim system of producton and at reducing the role of the state in i These credit will be presented for approval following an agreement on a revised mm-ecowmic frmeor, ilnduding a feasible and steady reduction of the deficit and an increase in developmel expediture. They would be folowed by SAC U, to complete the reforms of the reguator framework, public resource management and the Incetive sysm 35. In addion to quick-disbursing oprations, the Banl's lending program includes a number of investmnt projects addressing Rwanda's cetWal development issues. The objective of R sMtaL- based gowth would be supported by: a Priva Sector Development project, to improve the regulatory and istuional frameork for private businesses and provide commercial ba in d credit to the prvat sector; and a Second Agricultural Research project, building on the experience from the first project, to ort prmotion of higher yields and fertilizer research. 36. Ihe objective of m oubi;c reurce mam u= would be pursued largely through the annal PERs, backed by conditionality under the adjustment opaons and though a Communal Delopent project, wbich would support capacity building of local governments, urban development and local inatives. 37. In addion to the operation descrbed in this report, and the on-going opeons in this area (e.g. the Health and Poput project), the human ra rce and etv allevion bWectives will be  suported In the medium term by the following proJects: a Medical Supplies Sub-sectr project, to Improve-the availability of medines ad the management and facing of the sub-sector; an Education project, to improve acc to and quality of seconday educadon; and the Third Water Supply project to increase safe drinkng water avalabiity in rural areas and sanitatin in major cities. 38. YWomen!s deviXment will be supported through the on-going and proposed population, health and education projects, as wel as through the proposed recommended i this report and the proposed AGSAC. One of the man objectives of the on-going famly health and population projctss b to reduce mater mortality rates. The prtnay objective of the ongoing education project is to increase primary scbool enolment, which would boost overal access, nluding for girls. Women are a prime target group of the food aid and ntritonal component of the project recommended in this report. Finally, the proposed AGSAC would upport changes in the land tenure code to ensure equal property rights between men and women (e.g., buy and sell land regstered in their name). 39. Finally, in additon to the recent Environment Strateg and Action Plan which were prepared with Bank assistance, the a Lresourme magment objective would be supported by an Energy Sector project to reduce the use of fuelwood by promoting alteive sources of energy and improving charcoal production tehiwques, the Second Agicltural Research project, and a ForestryiEvoent project to iVmo forestry m gment and develop tree plantions to arrest soil erosion. 40. Economic and Sector nl recent years, major economic and sector reports helped document the case for adjustmet and identfy necesay reforms in crucial areas such as the exchange rate, the legal and reguatory firmework, the financial sector, agriculture, pa ls, and public resource management1. Future economic and sector work will also be focussed on the Bank's sttegic priorides strti with sWport of the adjustm proces. The evaluation of the first phase of adjusm and the Id-fication of priateconomic reorms for the second phase will be the focus of the next Country Economic M a Y94). An ongoing study of Labor Legislation (FY92) is expected to formulate reco aimed at reducing labor market rigidities. Ihe main Istument of Bank assistance for the pogessive improvement in public resources management wil contmue to be the annual PEr-. Future PERs would also aim to bring about gr tasparency in resource allocation, improvements in pement proces, and systemac audits of public an accounts. Poverty alleviation will be addressed th a povety _as report, scheduled to start in FY93, and the annual PERs will hebp the Governmnlt formulate yearly a program of key expen to be protected as part of the safety net". A study of secondary and higher education (FY93) as well as a study on health cost recovery (FY94) wMi constute the main vehicles for the dialogue on huuma resourcs development policies. 41. ihion and PortflikManagomt Supervision efforts will be strengthened and specific will be incuded in aU new project to adres impletn issues. In addition, annual See County Economic M ndum port No. 6191-RW), the First Public Expendture Revi (Report No. 7717-RW), the Financal Sector Study (Report No. 8934-RW), and the Agdrculal Sector Review (Report No. 8704-RW). The two latter reprts lay the bas for policy reforms to be suppoted by the proposed FINSAC and AGSAC.  - 12- Country Implemeation Reviews (CR) wl provide a firaework for a dlalogue on mpwovilg project Impi on. he CIR will be cafried out in FY93. Speca emphasis will be put on bmproving prcemnt procedur to accelerate the dis ement rate. Siuce prcuremet Isues bave been idendfied as a major obstacle to project Implemention, a Country Prcement Assesme report wil be preped in FY93. 42. A c in the context of the ovel objectve of human resource development, the Bankes aim is to promote the type of technica asmistc tht helps build local capacity, in both public and pva nstitutns. Given the Governmnens prfce to use grants for nical assistance, the Bank does not propose to fmce freetanding thical a projects (once the two ongoing projects are Implemened). Instead, the Bank will: $ Inroduce selected assi e components In fute projects; (i) collaborate with UNDP in the preparaton of a tecal assistace management fework in support of the Government's adjustment program; and (il) help develop local consulting services throgh grant support from the Baik's proposed Insdtutional Development Fund (IDF). As a general rule, the Bank will, in consultation with other donors and to the extent feasible, encourage the ahories to limit expaie asistance to highy specialized services and use thbe expets for short-term consultations, while asring tt the asistce also makes a positive contribution to tainng of local counterparts and building of local capacity. 43. Aid Cggd4anafndk Rl sd= w }It . Over the past two years, the Bank has regulaly kept the major donors informed of its policy dbscussion with Rwanda. The strog pateship with don which devdoped during the prepton of the first Stucturl AdJustment Credit wil be manained during the next phase of adjument. Evidence of the positive coopeaton among donors is the agreement on ratondalizing the utilii of counterpa finds noted earier (para 31) and their colaboraion in PERs. In March 1991, In the framwork of the Special Program of Aitanc for Africa, the Bank rganized a donors meeting on Rwanda to mobilize exteral financial astamce for the adjustme program In 1991. UNDP has scheduled a Round Table meewt for July 1992; the Bank has helped in is preparion by reviewing the goverment's public iwtmvt program 44. Clos coilaboration with the IMF has been a g-standng featre of Bank relas with Rwanda. The first PFP was prepared joinly by the authories and lhe staff of the Bank and the Fund. Alao, Bank and Fund mission have closely coorin the and the timng of their waor, and are workig tgether to help Rwanda fomulat a new medium-term famewodr The Govenment has requested a second drawing on the Structual Adjustment Facility, and discions would get under way for a second year SAP arrangement once a revised macr-economic framework has been agreed. 45. Opporuies for E: activities in Rwanda have so far been hiited by the small size of the country, the lack of export-oriented projects, and the iniknt statUs of the pdvatO sector. IFC has made thr las to SORWATHE (the Rwadese Tea Compay) -Credits 337-RW, 470-RW and 764-RW- has take two equit parciation In SORWAL (the Rwande Company of Mthes) and SORWATHE, d is in the process of completing two African Enteprise Fumd (AEP) projects. The IFC sees a major role in Rwanda for AE. Rwanda signed and ratiied the IIGA convention on Octbr 27, 1989, but, as of mid-May 992, has not paid yet its capital subscription.  13- 3. 46. In the Immediate fiuro, keeping the country on the adjustnt path will be the main priority In the Bank's dialogue with Rwanda. While the governmt has d amonsr its cmmim to reform by impltg the key structura meses agree under the adjustment program, there are a number of riWs (e.g., ehc violence, polic instability, social unrest and extn shocds) which could force the Goverm nt to deviae fom the adjustmet path and dow the Implentaon of investment projects. 47. E ByjgIgO. The Goverment has been able to reart control over most of the national rritory after the Ivasion by Tutsi reigees in la 1990. As noted earlier, tie formation of a transitional coalition governmet in Apr 1992, with a Prie Mnister who is favorably regarded by the Tutd commuity, ncs the prospects for an ely resoludon of th refugee problem Nevertheless, the secuity sitato remains fagile and, unti nationa reconciiation is achieved, the risk of ethic violence will remain a potaly debilizing factor. 48. Political htabilib. Politcal pluralism Is cddcal to the success of a lasting national reconciation effr and an efctive dialogue with the refugees. Ihe recent agreemet on a coalition transitional governme constitutes n Important step. However, if not ranslated rapidly ough electons into a permanent e government, the transition might lead to civii unrest and stall the adjustment process. In un, this would weaken donor support for Rwanda. The progress so far in the national diogue and the decison of major donors to linck thei assistuce to he coniaon of poiNcal reforms reduces this rlisk 49. SodI mri Food shortages In tie event of adverse weather could lead to social umest. The project desce in his report is targetod at te most vulnerable groups and should help reduce t risk. Also, to alleviate the risk that some of the adjusent measmes might affect during a transiional phase the most vulnerable groups, the deds of the strucura adjustment program includes a soca 'safety nee wih would contme under future adjustment oet. Finally, to the extent that the adjustment effor (pa ry in agicuue) succeeds in stiulat growth, economic oppornies and gainful employme will expad, cr ate tie conditos for broadbwed socia gan, and thus alleviae social tesions. 50. .l dw. A further decline of world coffee prices and additional a rn difficulties related tD security problems coud have a negate impact on export eaings and governme revenue, * and thereby weaken the current account of the balance of pay and the fiscal situa . In order to alleviate his rsk, the adjustment program provides for a Msbtantia build-p in reserves. In addition, the response to date of the interal commuity in the fiamework of the SPA in providing adequate and timely balnceof-payments support indicates that Rwanda can count on Is partners to help it weather these external sbocs. F. Cids fao Ekalatg CI ount1 Per 51. Poe in the Implm of the Bankes state will be monitore by trackg the following performance b arks: - rduct in the budget defcit as a percentage of GDP to the levels to be agreed upon in the second PFP;  - 14 - - effective Iplentan of sctur reforms; - irea in the hA of developmen expendime to the levels to be agrd in the second PFP, Icuding efwt Ilemenation of the soci safety ne" to be agreed In the famework of the annual PERs; - recovery of privat nvestment and significant progress In exp diversification: - Improved portfolio performance, measured by an increase in the dsbursement rate of Bank- finaned projects; - increase in the contaceptve prevalee rate; - Improvement in poverty indicators of target popultion. 52. The two sector adjustment operations (FINSAC and AGSAC) will be preened to the Board when an g is readhed with the Goveent on a revised mar-onomic framework. If the above bench kat Indicae a major deterioration in Government performance In implementiDg the adjustment program, the Bank would not declare these two credits fecdve, and would hold off further quick- disbursing assistance and major sector opeaons. Ibstead, it would implement a reduced lending program (amountg to US$4-S per capita per annum) of one to two investment projects per year aimed at preserng Rwanda's long-tem development potenal through invwestmnt for poverty allwiaion and huma capital deveopment G. &am= 53. Rwanda is at a swroads, facing a momn economic and political tastion. As of early 1990, there were no clear signs of change in the intrusive and dominant economic role of the state, the poltc monopoly of the ruling pary, or the relatonship between the rding Hutu majority and the Tutsi minority. Just a year later, the Governmnt had embarked on a structur adjustmen program and begun an opening of the polWcal system, and was fight off an armed tnvasion by Tutsi refugees. The military buildup has compwomised the 1991 fiscal targets of the first PFP and the socia safety net undelying the adjustme program spported by IDA's first Structural Adjustmnt Credit (SAC) and the AMP's Stuctural Adjusment Faclity (SAF). Thus, the Govement's cballenge is to manage simultaneusly the difficult reform program, the on-going progeson to a multiprty political stem, and the resolution of the psst ethnic problem that underlies the armed conflict. In the long run, these three tasks are complementary, and meeting this dhaienge would put the country on the path of _suined economic growth. 54. Tec Bank's strategy iS to respond to the Government's ots by helping to promote sustained growth with equit, to reduce poverty and to protect the environment. Priy wl be given to supporting the adju t proces, developing an nentive sructure geated at promoting export-oente private sector investment, reducing the role of the state and impwoving public resource manement. Prvided the Govenment demonsr its cmms to the needed economic, political and social reorms, the Bank's lending program will average three to four operations a year, with quick-disbursing support expected to amount to 35-40 percent of total lending. Goverment pfomance would be mnitored on the basis of specific benchmak. Should the Govement fail to demon e its commiment to the reforms and to impwve the rate of di on the Bank portfolio, the Bank would dbcontinue adjustment lendig and reduce its lending program to one or two investment projects per year aimed at tacking povety direty and at prerving Rwanda's long-wterm potent.  - 1S- Prr U- TIlE PROPOE CREDIT 55. Rwnda's developmet agenda for the 1990s Includes: (a) reversing teon ye of economic decline through a crhensiv adjstnt progrm aunched in la4t 1990); (b) mitigating the negative soci Impact of economic deterioration; (c) controlAing ite eplosive population growth ate (estmatd at 3.6 percet in 1991) which would lead to a doubling of the current population of 7.3 milion in less than 20 years; and (d) moving towards a multi-party system and Iitaing a peace process with rebels based in Uganda. These are dcallenging goals and among them the most urgent one is to end the war becase military expenditur are crowdig out other budgetary items, partcldarly socW expenditus: in 1991, milty outays rersentd 42 percent of the current budget (as compared to 3.8 percent for health). After 25 years of contnuous improvement In living stand, there are signs of stanation as revealed by cetain social indicators: under-five mortity rate Is still around 200 per thousand; malmurtion rates reach 30 percent among children and 20 percent for pregnant women. While these figures are just htly below average for sub4an Africa, they indicate a negative trend. Food inseurity has become prevalent in the southern areas of the coutry because of the combination of two ctors: high population pressure on land (more than 400 per kn2 of arable land, the highest density in Afica) and lack of purchaig power of the population to buy food. Famin erupted in the South in 1989 with a significant number of people dying of hunger. While the numbers are stll relively small (as compad with massive famines in certain African counties), they reveal the need for prompt acton to prevent further deteriion. 56. Rwda's envoment Is made difficut by naural cause such as dises (the malaia endemic and te AIDS epiemic are severe) or eatic rain falls (which can ruin harvests) as well as man- induced problems such as the demental effects of popuation presure on agdeulture and the ecoystm. Poverty is widespread: a poverty profie based on the findings of a 1983486 household budget consumption suve confirms the prmise that while Rwanda is globaly poor by inteationals8 (GNP per capha was estmated at US$300 in 1990), certain population groups are so poor that they do not have the means for adequate survival. These people can be considered as the hard-core poor" and are the main target grou of the proposed operion. The poverty profile ha also help idendtfy certain cs of the poorer families: (a) landess fams and farmers with plots too small to make a * living; (b) large families, particuarly in the case of femaleheaded housholds; and (c) vulnerability to price incres for specMic imported goods (such as pharmceticas and kerosene). Overall, poverty is essentially a runr phenmenon 93 percent of the populn lives in rural areas and the incence of poverty is much higher in the countrys than in urba areas (urban household _ are 2.4 times higher). Ihe AIDS epidemic (2 percent of the adults aged 15-45 are Infected in Kigali, a 3 percent in rural areas) is incr g the number of poor by kllgincome earnes at e most productive age and leaving an ever increaing number of orhas. 57. Until recey, the govemment's response to these social problems has been hampered by: (a) the delay In launcing an apropriate populaton progra; (b) insuicient resource allocaons tD basic health care and public health programs; and (c) the absence of national targeted social programs aimed towards the basic needs (particularly food securty) of the hard-core" poor whose number i8 increasing with the deteriorting ecomic dution. Since 1990, the govemen in collaboration with the Bank has made significant progress In these three reas, in parllel with the luching of the stctur  -16- adjUsmet progrm First, on poputon Ises, ihe govermnt has fmally issued a populaion policy calln for the redcton of the popuatin growth rate and the number of cildren per family. The Bank Is sporting the ImplementatIon of ths policy through a ipopulton project which was approved in June 1991. Second, the issue of adequt rource allocation to socidal secto in general and health progms in particular is an sentlal element of the Public Expendture Review (PER) iniated as part of the stuctr adjustmet program. The govrment, however, has seious difficlties fulfilling its commiment to mainain a safety net of core sodca ex because of excessive militauy spending caused by the war. This siuation calls for close monitring and continuous dialogue with the governent on socia sector policies. Finlly, the need for targetod social programs with a focus on improving the food security of the poor will be addressed by te prposed operation. 58. Ptoiect Desiun and Objetives. no proposed operatd has been conceived as a comprehensivo support to the National Social Action Program (troe National d'Action Sociale - PM The short term objective of the PNAS is to reduce food Insecurity, malnutrition and other effects of poventy among the poorest popuation groups of Rwanda. The medium and long tem objectives of the PNAS are to: (a) induce policy chaes to use efficientiy the most Important asset of the country, its labor force; (b) conbute to the pomotion and development of off-farm employment at the community level; and (c) monitor the ling stanards of the population and develop more efficient poverty alleviation stategies. The PNAS has ftree main taget groups: (a) Indviduals and families with no or insufficient income-enng capabilities, such as landless farmers, poor female-headed households, AIDS-afflicted fmilies, orphans and others (annual target of 75,000 people); (b) farmers faced with acte transitory food insecurty (nnual target could vary from 0 to S50,000 people); and (c) farmers with land smaller than 0.2 hectare which will need off-farm employment to survive (annual target of 25,000 workers and 125,000 dependent). In addition, potent micro-reprenrs will be the target of the micro-enterprise development componem: it is estm tat approimately mic-enterprises (for a total of 4500 workers and 20,000 dep_) will be created during the life of the project. Overall, the target groups represent about 10 percent of Rwanda's populatio 59. = n Food Aid and Nuiio con would aim at reducing food insecurity and malnutrition through: (a) the provision of food aid by the World Food Program (WFP), of which more than 50 percent will be purchaed locally to stimula local production) and targeted at vulnerable fnmilies (with malnorihd children or pre g women), AIDS-afflicted households and orphans, in combination with a package of mtition actvites delvered by the network of mntrition centers; (b) emergency food aid for regions thratened by acute food insecurity caused by a combinalion of failed harvest and lack of purchaing power; and (c) implem i of a coordinated food aid policy agreed upon between donors and the government Ihe LIbru- Wo r,BW)..wnn@n wowld increase the purchasing power (and thus conibute to Impoving food security) of the population of the 43 poorest communes of tie country (Ientfied out of a tot of 145 on the basis of a poverty Index), through community-baed public works including: (a) communal road rehabilitation and maintenam ; (b) anti-erosion and land impwvement measures such as reforestation and agricutural teacing; and (c) oher works of public interest such as markets and water supply. Ihe Mbwmufz.2 Promotion and DVAQMM wo=_ would p;vide ididua and communities with opportnitIes to develop productie micro-projects through: (a) the establihmet of a network of traed local leaders who will be responsible for creatng awareness among the rural population on off-farm employment opportunies twoUgh fte creation of micet ; (b) the selection of te most viable projects and training the by NGs with demonsed experienc in the relevamt fields; (c) assistanc in the process of obtaing the necessary credits through financial institutions, eier banks or local credit asocaon; and (d) follow up of microent sand _ of tir perfmance. Fnly, the Soc ialS na  - 17- ad Pover M oIn omt (US$1.4 milion) would aim at strenghng th govenmment's capacites to: (a) monitor the living stadards of the population through household-based social surveys; 0) nalyze and thcflninte results of these surveys; and (c) conuto to policy adjustmet for more effective and efficient poverty alleviation The design of each component has been based on the eperien of on-going operat or pilot projects being carried out in Rwanda. Ihe tot cost of the proect has been e0mated at US$46.1 million, including US$6.1 millio for ontigencies. Ihe breakdown of costs and the fnacing plan are shown In schedile A. Amounts and methods of prouementl, the disbuem catWodes and schedule are shown In schedule B. 'Me time table of key processing events and Bank Group opatons in Rwanda are given in shedule C and D respectively. A map is atached. Ihe Staff Appraisal Report No. 10373-RW dated May 26, 1992 is being distued dqray. 60. . eFt imnanci al managemnt (including budgeting, disbursemens, procurement and accountng will be cetrized In a maagemnt unit urua. de a=d nid Jmp). It will be located under the umbrela of the Mnisty of Planming which has overal responsibility for nitoring the soci safety net. Te BCP wil be given an autonomous staus by decree to avoid undue Interfee from the aton In addition, the BCP will be staffd by local expets with a consultant status and salary benefits comparable to those in the private sector. Technical management of the Food Aid and Nutrtion, LBWs, and Mic-Enrpe components will be decrlized to specific ecuting units which will be responle for the day-to-day management of PNAS actvities. The social msvey compoent will be executed by the Diectrate of Stadtits in the Mnity of Planning. Ihe execun 8units for LBWs and M ro-entprise are ready operational with UNDPILO suppor The executing unk for the Food Aid and Nutrition component wil be established as an opeatonal support to the Direcrae of Soca Affirs which handes food aid distiut with the local WFP office. ontersectora c i -agency coordination and overl upevision of the PNAS will be under te rs ibility of the Cnad d o dintiuPNASwhichinudes Preprsntv of all ministries involved in the PNAS and repesentatives from selected NGOs and donors. The Cnseil wil have a consultative madate with regards to overal supervision of the PNAS and statec adjustments and an executve mandate with regards to maintainin adequate stfng of the BCP and executing units and following up on the pefornce of tis staff. The BCP wl act as the p _ secntari of the QDH1. A UNDP-supported technical asace program will provide the specfic skis required for financial and the technical aspects of ctin project acdvities. The objectives of this techncal assistnce progm are to: (a) Improve the coorinaton among the project compoents; (b) assess achievements of the PNAS; and (c) ensure the overall niring of the social safety net 61. i. Th oationa sustaInability of the project will be achieved by rdying on a commuity-baWd involving: (a) prive enties (private co cors, associatio, micro-entepreneurs; and others) with proven m _*anaeills; (b) NOOs and deen lized projects involved in deveopment acivities at the field level; (c) a more systeaic padction of the most dec d gove (the n investment planing and monitoring; and (d) active participaon of cmmuniti In project activies (aticulaly with regars to the identfication of target groups). The centra governnt will contbute to financial sustinabity by provig adequate recurrent funding as part of the core soci expendiu pogrm Sustied extenal support will be necessay for arenb ad budgetary support trouh the social safety net of public expenditures. Addltonl revenoues gena by certain communa in_ (such as markets) wil cover part of the reurr cost iplicaon of the nw socia Inesme. Project sanabilitwill be reviewed for each cmponn durig the midterm project impail rview and rcmn o will be made in  - 18- ord to Improve the susnability of the most effective and efficient actvites. 62. LessoM Leaed from Prei DA nolveme. Most project in Rwanda fe Implemention delas and procuemnt problems due to: (a) bureaucratic red tape hampeing effcdve deision making; (b) weak m_aia capabilities In the public sector; and (c) Insufficient involvement of decentalized gov I , communites and beneficiaies in the Imp Ion process of deeopmeat actvities. The propose operaion wll address theso issues h: (a) liming the role of the ceal administraion to overall supvion and guiddace; (b) ensuring an effective project managemen throug an autonomous stwcture staffed with motiatetd nationais who wi receive dhe csary tWainig in pro uement, disbursent and acountg; and (c) invving private contactors, NGOs, the commutes and association of benficiaries In the socil srvice delivery process. Compliance with audit rqirm is fuy satisfactoy In dhe social sectors. 63. RaB;onle for IDA l 1yawmt. 'Me proposed opration Is an importa element in the Bans satgy of assisance to Rwanda It will help alleviae poverty by supportig activities that are an integra pat of the socW safety net (cluding essental programs in Health, Primary and Secondary Educatin and Population) which has ben established wit the framework of the governmet adjustment progm. This project would complement ongoing projects in Health (FY86, Education (FY91) and Populaion (FY91). The Bans role is essental in isting the governumn in creating a conceptual and o nal framework for poverty aleeviation and coordinatg atel inbtventions in collaboration with UNDP. 64. aed Actons. The following are conditions of credit efectiveness: (a) the approval by IDA of the 199395 public expenditure program in social sectors; (b) the approva by IDA of the traiing program for the LBWs; (C) the establismen of the n 2 and the BCP and selecion ad appointment of staff for all key positns of the BCP and the execut units; (d) the establishmt of a project account in a financial instiuon with the inidal deposk of the govement oon3trtion; (e) the proposed acounting sysem has been found acceptable by IDA; and (f) all the standard biddng documents have been found acceptable by IDA. Other Include: (a) annual ppartion and satoy Implemeio of the social sector public expde progam sfactory to IDA; (b) bmission of amnal work programs and budgets; (c) satitory activity reports; and (d) mid-trm impln roview. 65. Envk enmalAs -. Theproposed operationbelongs to category B. The environmental impact should be positve through anti-erosion meu (ref taon, iuurl terracin carried out as part of the LBWs component Poteni negative effects on the environment are minial and will be prevented though a set of masures which have been Ideified durig project preparation, including: (a) the pr vatio of top-soil, eisting natu forts and diversiy of tree species; and (b) the establim of a positve list of mic-enterprses with specific evironmental gdelines. 66. !QM baiIym The proposed operation is a core component of the county poverty a evon stry. 67. Ie . The direct benefc of the proposed oaon will be people in need of pennw Xfood aid (a tot of 300,000 people over 4 years) and farme in need of off-farm employment to suvie (a total of 600,000 people over 4 years). In addion, the project would establislh a mechanism to resd rapidly to acute food _inty through early wanig and emergency food aid distibution.  - 19- lhe project would also contribe to create mr-enterprises at the community level, promote off-farm employment and strengthen the role of the commue as a local development agency. Communal investments (implmented through LBWs) would generate local economic and social benefits. An indirect benefit wil be local capacity bulding trough the traini of small and medium enterprises. In the long term, the project would conute to a better monitoring of the living stanards of the population, a better understanding of the auses of poverty and overall improvemt In social policy development. 68. RiWk. Ihe main risk is that impl delays occur because of inefficient project mangement. Iis risk has been addressed by: (a) establising an adequate management structure, including sufficient autonomy from the a n; (b) training key project staff in project management, procurement, disbusement and accouning prior to credit effectiveness; (c) establish an indicator-based monhoring system which will scan on a pem ent basis three areas of project implementation, namely financing, inputs and field execion; and (d) involving beneficiaries in the monitoring process. 69. . I am sadsfied that the proposed credit would comply with the articles of Agreemet of the Assocation and recommend that the Executive Directors approve the proposed credit. Lewis Preston President Attachmen WahDngon, D.C. May 27, 1992  - 20 - Schedul A Page I of I RWANDA FOOD SECURITY AND SOCIAL ACTION PROJECT XLlTMAa =QTS AN12 MINAK=IN US$ million percentge MaSI]D& COSTS Loc Pre gnd EoeignEcae Food Aid and Nutrition 8.1 5.9 14.0 44 Labor Based Works 13.4 4.4 17.8 34 Support to Micro ses 2.7 0.6 3.3 24 Surveys 0.8 0.6 1.4 71 Projet Management 0.6 1.5 2.1 78 PPF 0.3 1.0 1.3 79 Total Base Costs 25.9 14.0 39.9 42 Physical CoIngences 1.8 0.7 2.5 36 Price Coencies 2.7 1.0 3.6 34 Total Proje ctosts 30.4 15.7 46.1 41 IDA 12.5 6.6 19.1 41 UNTP 1.0 2.1 3.1 7 WPP 8.9 7.0 15.9 34 Government *8.0 - 8.0 17 TOTAL 30.4 15.7 *46.1 *Part of gvermnmentI's contrfibution vif Ii be cw.bythe Unif ied Counterprt Fund (pool of coneprt funds duinistered by the Treasury) ad by the Unifd d Furd (maaed by the Nfnistry of Putio Vorks= for the maintenance of cowxtl road. Excluding US2.3 millton equlvalent for taxes and US0.70 million eswivalent for iqport duties.  _ 21 - Schedul B Page 1 of 2 RWANDA FOOD SECURITY AND SOCLAL ACTION PROJECT PROCURhTAND DISBURSEM-ENT (U$ Million) pROCIZAEITANGEMNEM TOWd _______________________ LOC3 LC. 0lIw N..F. Cost *-1. 1 nrsr Cmiwiwl Reeds 2.6 0.7 3.3 (2.0) (0.7) 13.3) 1.2 Reforestatio 0.4 1.5 1.9 10.4) (1.5) 11.9) 1.3 8dl C _nsan 1.0 2.5 (1.01 11.5) (2.51 1.4 WA r SUpply 0.1 0.1 0.2 (0P.1 (0.1) (0.21 1.5 CammW Inwruatnt 0.4 0.1 0.5 0.4) 10.1) 10.5) 1.0 Urban Suwvos 0.2 0.4 0.6 (0.2 (0.4) 10.63 2. GOod 2.1 E4ulpwst&WNhs 3.5 0.1 0.2 3.6 and LIIW egipnwet (3.51 (0.1) 13.61 0.2 2.2 Me"ds. Cemt ppe. OIL 1.0 1.8 2.3 Feed 15.0 15.0 3. c __oebarls 3.1 studtes 0.4f 0.4 (0.13 (0.13 3.2 TechIca AuhI.wnoe 5.3 (2.1) 12.1) 3.3 T m 1.1 1.1 10.5) 10.53 4. Mmouamenu 4.1 bInrenta Operat Costs 1.0 6.4 0.4 fin. aLtrave AVwd w .I (0.891 (0.) 4.2 Mlero.entseprls ,tuds 2.0 2.0 10.0) 10.0) 4.3 PF RPtn_wln 1.3 1.3 (1.8) 11.31 TOTAL as 6os l5 22.9 461 a P() I16.) - 193) (00) (19.1) e1 Conult ssvlae wl be proued In scewdmnos with dh pinapie d propedur Pat ery to IDA an the bai of the 0udsle for the Us. of C.widtant. dated Aurt 1982. Note: Piure in pa_tbwe am the spe&tve anmort finaced by ft crediL N.B.P.: Not Bak fiawed.  - 22 - Page 2 of 2 RWANDA FOOD SECURIUY AND SOCIAL ACTION PROJECT PRMeNTANDDI (USS million) 1. ClYtI Works 8.5 100% 2. Equpm*nt, vehicles, 4.5 100X of foreign exchange taterieals and supplies SO% of local costs 3. TechnicaL Assistance 1.5 100X 4. Training and Studies 0.3 tOOX of foreign exchange S. Increnetal Operating Costs (exctuding salaries and 0.9 100% travwt allowances) 6. PPF 1.3 100X of total eosts 7. Unallocated 2.1 N/A Total 19.1 EIATBD IDA DISIBURSlrS (US$ Mlion) * EX2~~~~~r9 EXC9A EI9S EI2Ers Amna 1.5 4.4 6.0 4.8 2.4 Cumulative 1.5 5.9 11.9 16.7 19.1  - 23 - SchdulC Page 1 of I RWANDA FOOD SECURIrY AND SOCIAL ACTION PROJECT iaA AMI KEYf PROQ3SSINGE (a) TMmtakentoprepar: 12monas (b) Prepared by: Government with UNDP and IDA assistamce* (c) IDA Identificaton: January 1991 (d) Preo-praial mis Sepember 1991 (e) Appraisal msion: December 1991 (t) Negotiations: May 1992 (g) Planned date of effetvess: January 1993 (h) List of relevant PCRs: na. * 'he staff responsble for project preparation were: Dr. Jacques Baudouy (AF3PHE Pinipal Publc Health Speciaist), Mr. Qaise Khan (AF3PH, Economist), Ms Eileen Murray (AF3PH, Fianaca Analyst), Ms Gisale Dlaine (AFTSP, statisdcian), Mr. Kees T 1neburg (AFTSP, Economist) and Mr. Marco Feroni (AFTSP, Enmist).  - 24 - Schedule D Status of Bank Group Operations in Rwanda PFDBR25 - Su_mary Statemet of Loans and IDA Credits (LOA data as of 4/30/92 - MIS data as of 5M/26/92 Antwnt In US$ dIllon lO owwelalons Loan or Credit No. FIbe Yea slwer Pwpoe sobk IDA Undbbu Cloing date rod CrodIt 22.48 24 Crft(e) dosd C12B30-RWA 19a3 RWANDA lUGEBEA I 10.30 .2r 1231191 JRi C15400-RWA 1083 RWANDA AGhR RESEARCH 11.50 3.19 12/31191 (R1 C150.S04WA 19s RWANDA TAS PUUIC SECTOR MG 4.60 3.06 06/30192 (RW C164104WA 106 RWANOA HWY8 VI 11.00 1.01 03f31i92 (R1 C18500RWA low RWANDA BRD IV 9.00 3.10 12V31/93 C16780-RWA 1980 RWANDA FAMILY HEALTH 10.60 0.30 O0630192 CItO30-RWA 1906 RWANDA EDUCATION U 15.00 10.92 12/31192 (II C178304RWA 19B7 RWANOA WAYER SUP. n 15.00 8.69 12131/94 C179800RWA 1987 RWANDA PUB. SfT. MGOi. 7.40 6.86 12V31194 *181104RWA 1987? RWANDA FORESTRY U 14.10 10.26 O630/93 CA008141WA 1988 RWANDA HWYS. VI 10.00 10.90 12/31192(R) C20280-RWA t9Si RWANDA AG. SERviCES 19.90 t8.84 00/3395 C204104WA 19S RWANDA URBAN INST. 32.00 32.48 12/31/98 0211304.WA 1990 RWANDA PUIUC OfT. 4.40 4.31 12/31/94 C213800RWA 1090 RWANDA TRANS. SECT. 40.00 41.70 06/30/97 C218900RWA 1601 RWANDA COMUNICATON U 12.60 10.19 12/31/9 4C22270-RWA 1691 RWANDA EDUCATION SECT. CR. 23.30 22.20 09/30/96 C22710RWA(S) 1901 RWANDA SAL I 90.00 69.03 12/31/93 C022720AWA 1601 RWANDA POPULAMON 19.80 10.87 0130198 Total nwmbar CredI 19 307.50 271.11 TotsI** 660.06 of wid repId 11.02 Toed held by BO* & IDA 578.36 Amoant s of ~h epid Toed undsbweed 271.11 * Not wt efftide Not stsisd Tota Approved Rwpmenten an Cu* s bnod rpee both v eand _Ireolve and CrsdL (N) Misaim fod_ mealy rovid Clsn_ DOW S Indiete SAL/SECAL Loa en Credits. The Nt Approed ndW k Repsmnt am lihb_1, vaue. eU alrae market vdlus. The S4gnig. Effsalv, a Clsn da we based pp th Loa Depa t offiI dataand rwe not tken fiom th Tak T udget Tm grJ ueus wI1 be b* t Imrove Ow duh mwnt sl: firt. sral CdOoq bhmp ten Rbvlew MlO wIll Id1nI aen_a fr freIeot Inimenaso dWea nd eend eo mi to toh gW t flint CM wIM be aned out In FY63); and, md. a Coumfay Pmunw Asewsm eport wI be preprd In FY63 bems p>_rontet _us ho ben Idfied a a mjo amue of low diburwseet rat  - 25 - Page 2 of 2 STATUS Of NK S RoA w OPERtATION IN WAWA S. STATEMENT OF ZFC INVESTUMNTS IN RWANDA EXPRESSED N US$ (April 80, 1998) Investment Number Year Obligor Type of Businese Loan Equity Total 887-RW 1975 Sorwathb Too processing 0.S3 0.53 47040W 1979 Sorwatheand marketing 0.23 0.08 0.29 784-RW 1980 Sorwathe 0.29 0.29 102iiRi 198 Sorwal Mnutacturlng _ () 0.20 0.20 Total Gross Coawitments: 1.05 0.26 1.31 Less: Cancellations, termination, exchange adjustments, repa*mtes write-ott., and sales 1.06 0.08 1.21 Totea commituet hold by IFC 0.90 0.20 0.20 Total undisbursed 9.a0 0.00 0.00 Tot l dlsbused 0.90 0.20 0.20 (a) Loan guarntee of US42.1 million provided by IFC.  -26- RYIAIA - 00101C ICICA08S'Schedule E mid-i99 Population jstillaut) 7.2 1990 Per CaDlta GI WMU9: Soo A. Sume of Gros Coast It ProdLct B. Grofth Rates(% pe am.) (from ourrent price data) (from watant orice data) IM 1873 1980 1988 IW 1990 1985-73 1973-S O 18-90 l988 IBM Gross Domstlc Prod.jt D.P. 100.0 100.0C 100.0 100.0 1-00.0 100.0 5.6 8.5 1.2 -5.7 -.0- Net indlrcet TUNe 4.0 .8. 7. 8.5 8.0 8.2 . .. 2.0 -1.1 -10.8 * Agriculture ~~~~~~74.8 61.0 45.8 37.9 26.7 38.1 .. 8.7 -1.2 -11.8 5.4 ind.stry 8~~~~~~.9 8.? 21.5 21.8 2 2.8 22.2 *. 8.9 0.8 -1.1 -5.9 (.of NarifactuInig) 2.1 4.1 15.3 14.1 14.7 14.8 8. .3 0.7 -2.4 -4.0 Services ~~~~~18.4 30.2 22.6 40.3 40.5 39.7 .. 11.9 4.2 -3.0 -5.1 * Rasource Balance -4.8 -1.8 -11.9 -9.2 -5.3 -6.7T. . -1.5 -6.9 -40.8 Exxort of GNFS 12.1 11.8 14.4 9.0 8.? 9.2 4.0 8.4 3.6 -7.2 39.9 IqU~ot orf GNFS -18.9 13.4 20.4 18.2 18.0 17.9 3.2 10.8 1.3 -7.0 -9.3 Total Evbnditures 104.8 101.8 111.9 109.2 109.3 109.7 5.4 8.9 1.0 -5.8 -5.7 ,116tal Coansntlon 95.0 92.4 95.8 90.8 92.7 98.2 5.3 8.7 1.0 -5.5 0.5 Prlvate Consutlam 80.9 61.0 83.3 79.1 79.4 77.8 5.7 7. -0.1 -7.0 -3.1 OsiralI Goverrnnst 14.1 11.4 12.5 13.6 14.4 18.4 2.3 3.9 8.5 3.3 20.7 Gross omestic tnvestmant 9.8 9.4 18.1 15.7 15.8 12.5 4.7. 9.4 1.2 -7.4 -40.5 Fixed Investment .. . 12.2 15.1 16.0 13.7 .. 2.7 5.7 -2.4 -34.2 Chanlges In Stodcs..' 3.9 0.6 -0.3 -1.2. . . . Gross Domstic Saying 5.0 7.8 4.2 6.4 8.3 3.8 .. 29.7 4.8 -8.3 -40.0 Met Factor Income -.0.5 0.4 0.1 -0.6 -0.5 .0.7 . .-16.7 40.8 -44.1 Net Qirrent Transfers 0.0 -0.4 -0.3 0.5 0.4 0.3 .. . .5 -24.6 -23.6 Grows National Savirg 4.4 7.5 4.0 6.3 6.2 3.4 .. . 4.5 -7.9 -44. In b III lemof LC.s 16 1973 198 1988 1W 1990 (at constant 1987 orIcess) Gross Domestic Prodot 61 92 142 173 163 160 5.6 6.5 1.2 -5.7 -2.0 Capacity to Import 6 a 13 16 14 14 4.0 10.6 0.6 -9.8 -2.9 termsof Trade AdJwt"mmn 1 1 1 2 2 43 Groswoametl InComIeF 62 93 143 175 185 157 5.5 6.8 0.9 -86. -4.8 Gross National Prodiat or 93 142 .172 182 159 5.8 6.5 1.1 -5.6 -2.2 Gross National Incm 61 94 143 174 164 156 5.5 6.8 0.9 -5.8 -5.0 -100)- p---- Iflto aa .a.) - C. Price lndlces 1960 158 1966 1988 1W 1990 1965-73 1973-80 1980-90 1989 1990 Conseer Price (IFS 64) 70.9O 57.1 96. 10.0 1-04.0 1084 .2.0 -15.7-- 1.2 71. 4.2 tvioesale Prices (IFS 83) . . .. .. . ImolIcit GOP Deflator 76.0 106.2 98. 109.2 107:i 1110: 8:0 16:2 1.1 3.8 3.2 iop Ileft EVws ltures 03f*1. 78.5 102.5 94.4 102.5 106.8 115.3 8.0 16.2 2.0 4.0 8.2 0. Other Indicators: 1965-73 1973-80 1980-90 growth RatesC(' P.&.): Pw~itat Ion .3.1 3.4 3.7 Laor Force 2.8 3.2 2.8 Gros Matt. In"o= P.C. 2.3 3.3 -2.9 Private Can urtion p.o. 2.5 3.6 -3.8 Import Elasticity: import (GWIS) / GO(RNO) 0.6 1.7 2.2 *Marlnal Savings Rates: Gross atIoali SavIn 13.3 -2.8 -1.0 Gross DometIC Savin 12.7 -2.4 0.9 1COt,Cerlod average): -. 13.1 ;IV" of Total I955 1973 1980 1989 1890 .&bo Forc In: Ag,~iculture 94.2 934 928A Industry 2.4 2.7 2.5 . Services 2.4 3.9 4.3 Total 100.0 100.0 1100.0 100.0 M~  - 27 - 98WCA - E~oLIcIIC tCATORS. Schedule E PAGE 2 OF 3 Volue Inlex Value at wrment PrIm (mfIt law WUS) E. Vrc dse bvorts 198 198 1987 1988 1990 190 198$ 19S7 1988 198g t X.BtV.COFF&t 47.7 70.2 10O.0 73.9 61.6 98.7 a3 85 91 85 ,59 74 X.0AGO I.X 19 7 7 6 7 6 x.SEv.rIA 76.2 99.3 100.0 109.4 140.7 140.7 12 15 13 16 21 25 X.O^G;=I.Y 838.8 458.8 100.0 84.8 92.2 87.1 5 1 0 0 1 0 lwJfactures .. .. .. .. .. .. 2 2 4 5 5 RasidLal is .. ' .. .. .. 10 16 8 7 12 13 Total Evorts FOtS.. 83.5 WO.O 7.5 80.8 109.3 109 126 121 118 105 122 F. Mrchandils Imprts Food 57.8 141.6 100.0 87.2 81.4 96.3 21 58 48 46 40 32 Fuel and ergy 52.7 89.1 100.0 101.5 97.8 70.2 29 51 54 84 48 45 Oth. wwwrgoods 89.8 110.3 100.0 98.4 72.7 49.0 79 70 75 80 58 47 Outer intermed goods 80.2 120.9 100.0 109.5 112.9 100.1 5s 51 59 65 103 97 Caottal goods 59.9 67.4 100.0 103.0 10C.1 115.4 71 68 117 125 88 98 Total Imorts CIF 86.7 97.5 100.0 99.9 93.9 83.3 235 298 354 370 334 318 G. trdcandise Terms of Trade 1980 1985 1917 1981 1989 1990 Nerch. EVorts Price Index .. 151.3 100.0 116.9 103.8 83.4 iMarch. imports Price irdex 108.0 107.4 100.0 100.4 100.9 111.9 Merch. Terms of Trade .. 140.8 100.0 116.4 102.7 74.5 U$ mlII oans (at currant prIces): M. Balance of Paimts 1980 1985 1987 1988 1989 199O Expors of Goods & fS 165 161 168 181 148 154 MerdIse (FOB) 134 126 121 118 105 .109 NWt-Factor Servlces 32 35 48 44 43 45 lworts of Goods & WFS 319 336 418 421 379 868 Merchandise (FOB) 196 219 267 279 254 233 Non-Factor Services 123 117 151 142 .25 135 Resource Balas -154 -175 -251 -280 -231 -214 Nat Factor Income 2 -6 -10 -14 -10 -14 (interest per OS) 5 4 7 9 8 10 Net Currmnt Transfrs -3 4 7 11 8 7 (workers resittans) 1 1 2 1 1 1 Curr A/C Oal Befre Off. Grints -155 -176 -253 -283 -233 -222 Net Official Transfers 107 112 119 139 128 123 Q rr A/C Bal After Off. rant -48 -4 -134 -124 -105 -9 LqV-Tsnm Cap lta I Inflow 44 73 106 85 so 34 Direct Investnrt is iS la 21 is 8 4etLT Los (OaSdsta) 2S 5B 9: S * 2 Ot8r LT Inflow (Nt) 3 0 1 1 -1 0 Total Otnr Items (not) 33 -9 8 0 6 1 Net snort Term Capital 35 ..-8 11 -2 5 -2 Caita Filows N..I. 0 0 0 0 0 0 Errors and OnissIJ -2 -1 -4 2 1 3 Changes In Nt Reserves -29 0 18 39 38 58 Net Credit from Vt IW .. . 0 .. . OUtr RJserves Changes - 0 18 39 38 58 As Shre of GMP: Resurce Balance -13 -10 -12 -11 -11 -10 InterestPayants 0 0 0 0 0 a Current Account Balance -13 -10 -12 -11 -11 -10 Moranri Items: Reserveselc.Gold (nll.tS) 187 113 164 118 70 44 Rerves Incl- Gold (il. USS 18? 113 184 118 70 44 Official X4Rate lLCU VSS) 82.84 101.28 79.67 76.45 79.95 82.86 Index Real Eff. XI a 90 100.0 146.84 133.82 134.4 132.42 120.96 GOP (millionsof arrent ll) 1183 1715 2159 2228 2178 2128 InC 11j9  - 28 - RUAk - E81OAIC INDICATORS *Scbedule E PAGE 2 WF 3 suanof Z- ' ' Growth PAtes Goverment FIra 160 1986 198? 1988 1989 im 196886 1987 1988 198t 1990 Current Ri lots 12.4 13.8 13.5 13.1 13.8 12.4 9.8 -1.8 0.8 3.2 -3.1 Current E Ittes 9.4 11.9 13.9 13.4 13.7 17.8 12.1 18.8 -0.5 D.4 29.7 current 13pt $lanos 3.0 2.0 -0.5 -0.3 0.1 -S.2 0.7 -24.6 38.1 3.8 2.0 Caoltal Receipt. Ctal Endltures 2.2 9.3 9.4 7:8 8:7 3.5 1: : -13.5 s2 -59:2 Overall Deficit .. 11.3 -8.9 7.8 8.8 -1.7 57.6 35.3 -14.7 3.3 2.4 Offlcial Capital Grants .. 2.6 2.4 3.5 3.3 3.3 -1.7 -8.4 50.8 -8.3 -0.1 External 8orrowirg (nmt) -0.3 3.5 4.6 2.8 2.4 1.5 83.1 30.0 45.8 -18.7 -36.1 Domestic mon-anrk BorrowIng 1.5 O.S 0.3 0.8 1.0 0.7 -10.2 -32.3 134.5 32.4 -28.9 Domestic lark FInavnirn -2.1 0.7 2.6 0.8 1.5 3.2 7.3 260.3 -69.5 95.5 112.1 Not Oisbursemmnts (US mlII mons) Debt Outstanding & Olsbursed (US: mII1oan) J. Exteral Capital Flows, Debt and Oebt Burden Ratios 1960 185 1987 1988 1899 19090 186 1985 1887 1988 1989 1990 Piubl ic & blicly .r. LT 25 71 92 78 54 65 1SO 332 564 613 606 86t Official Creditors 27 74 92 79 56 68 143 321 553 606 601 861 MUltl lateral 20 43 61 60 50 S8 91 232 . 391 436 462 590 of whic I8 - 0 0 0 0 0 0 0 0 0 0 0 0 of Nhlch IDA 10 29 39 30 31 21 58 152 251 274 .302 340 Bi lateral 7 30 32 19 6 10 52 89 162 169 1202 *7 Private Creditors -2 -3 0 -3 -3 -4 8 12 11 7 5 5 SLupl lers -2 -2 -3 -2 -1 -2 8 9 4 2 1 1 Flnrinc2al irkets 0 0 0 0 0 .. 0 0 0 0 0 0 Private & 8-granteed 0 0 0 0 0 0 0 a. *a 0 0 0 TotaILT 25 71 92 78 54 65 150 332 584 613 606 866 IMF Credit 8 -2 -3 -3 -3 0 14 10 7 4 1 0 Not 9,ot-Term Capital 35 -6 9 3 -4 -2 26 27 39 42 45 45 TotA ilncl. If &Not ST 66 63 98 76 47 63 190 369 610 658 652 910 Bankad IDA Ratios 198Q 1965 1987 1988 1989 1890 Share of Total L r-Te o0 1. IBSO as S of Total 0.00 0.00 0.00 0.00 0.00 0.00 2. IDA as Z of Totl 38.86 45.70 44.53 44.68 49.83 39.28 3. IMBIDA as S of oWAl 38.88 45.70 44.53 44.6B 49.83 39.26 Swre of LT Det Service 1. 159 as S of Total 0.00 0.00 0.00 0.00 0.00 0.00 2. IDA as X of Total 11.3 11.S 15.43 19.30 13.95 12.30 3. I1ROtIDA as X of Total 11.63 11.85 1S.43 19.30 13.5S 12.30 0O0-to-EVorts Ratios 1. Long-Trer DetAqdvDorts 81.90 193.83 313.83 348.59 372.56 548.86 2. IhF CredittJExDts 7.36 5.83 3.84 2.10 0.55 0.08 3. Siort-Teru CDeW1E,rts 14.17 15.74 21.70 23.60 27.35 28.22 4. LT+iJF+ST CtXiE,arts 103.42 215.41 339.36 374.29 400.47 M.15 ND-to-WP Ratlos 1. Long-re DeBtP 12.92 19.38 26.14 26.34 27.94 40.58 . IWU CredlWt/0P 1.16 0.58 0.32 0.16 0.04 0.00 . Shnort-TUoembtAGCP 2.24 1.57 1.81 1.78 2.05 2.08 I. LT+lW+ST CMO"GN 16.32 21.54 28.27 28.28 30.03 42.67 et Sevice Vorts p. bIlc & Gurantsed LT 2.34 7.87 10.48 9.72 13.22 15.98 '. Private on-1uan-teaed LT 0.00 0.00 0.00 0.00 0.00 0.00 Total Long-Term Debt Service 2.34 7.87 10.48 9.72 13.22 15.98 HF RePuochaes.Serv. 01gm. 0.05 0.99 1.56 1.B5 1.66 0.00 interest only on STDebt 1.80 1.57 1.34 1.59 2.95 1.59 Total (LTTIWF+Sr Int.) 4.20 10.44 13.35 12.9? 17.83 17.50  RWANDA UGANDA FOOD SECURITY AND TANZANIA SOCIAL ACTION PROJECT .- <COU MBOUN tAmE ~ Mg*R OCKSMA t1~~~~~~~~~~~~~~~~~~Lw 9~~~~~~~~~~~~~~~~~~~~~~~~~U U D lli; l- wcmd t