China - Pishihang - Chaohu Area Development Project

Doceut of The World Bank FOR OMCLAL USE ONLY 1epot No. 12013 PROJECT COM ION REPORT CHiNA PISEANG-4CA AREA DEVOPMENT PROJECT (LOAN 2579-A/CREDIT 1606-C1A) JUNE 17, 1993 MICROFICHE COPY Report No.:12013 CHA Type: (PCR) Title: PISHIHANG-CHAOHU AREA DEVELOPS Author: GIBBS, CHRISTOPHER Ext.:31735 Room:T 9044 Dept.:OEDD1 Agriculture Operations Division Country Department II East Asia and Pacific Regional Office This document has a restricted distribution and may be used by recipients only in tOe perfonrance of their official duties. Its contents may not othewise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS Currency Units = Yuan (Y) AppraisW Year (1984) Y 2.8/$ Implementation (average) Y 3.7/$ Completion Year (1992) Y 5.4/$ FISCAL YEAR OF THE BOIRROWER January 1 - December 31 WEIGHTS AND MEASURES Metric System ABBREVIATIONS ABC - Agricultural Bank of China AWRB - Anhui Water Resources Bureau ERR - Economic Rate of Remrn ICB - lnteational Competitive Bidding LCB - Local Competitive Bidding MWR - Ministry of Water Resources PCADP - Pishihang-Chaohu Area Development Project PCR - Project Completion Report PMO - Project Magement Cffice O&M - Operation and Mantnce SAR - Staff Appraisa Report TVE - Township and Village Enterprise  FOR OMCLAL USE ONLI THE WORLD SANK Washgon,t D.C. 204 U.SA. Opuml Ev_ uab June 17, 1993 MEMORANDUM TO THE EXECUTIE DIRE_ ADTHE PRESIDENT Subject Project Completion Report on Chia PishM%ang-Chaohu Area Dsvelopment Protect an279-/C.1606fC) Atached is t*. Project Completion Report on Cbina Pishihang-Chaohv Area Deadopment Project (LiL 2579-CHA and Cr. 1606-CHA) prepared by the East Asia and Padfic Regiona Office, with Part II contributed by the Borrower. Pishlhang-haohu was the first Bank Group project to assist largcale surfce rrigation and flood control in China. Mh project more than achived is physical targets and ib rated a satsaoy despite a complez design and isttutional and financial issues which arose duing The share of prqect costs contributed by firmers through labor rose from 29 percent to 44 percent at completion because of redu:ed availability of countepart funds. In addition responsity fo repayment of the Bank loan, including the echang rate ris; is epecxted to be ssiged to farrs,in line with sernment poliy introduced durmg the project period he failure to complete irigation mnagment studies and faciities may prevet ac ement of sstem performance potentiaL Investments in flood controJ, howeve, have already paid off by substantialy reducing the impact of the potentially catastrophic flood of 1991. Prject sustainability i rated as ll*. There are no pls to audit the prqect Attachment IThI docunent ha a restitd ditbution and may be used by edpient only In the perfomranco of 1 ter offial dutes. ht contents may not otherwise be discosed without World Bank authoiodon.  FOR OFFIC0 L US ONLY PROJECT COMETON REPORT CNA PISHMANG-CHAOHU AREA DEVELO PROJECT (LOAN 2579-CHA/CIT 1 ) Pr ~.................................................... EvaluwonSumm..a........................... . iii PART I: PROJECT REVIEW FROM BANKS PERSPECTIVE 1. ProjeIdentity .......... 1 2. Background .. 1 3. Project Objectives and Description ......................... 2 4. Proiect Design and Organzaton ... ..... .......... . 4 5. Project Inplementation ........... .............. 7 6. rojectResuIts ......................... 8 7. Project Sustainability ........... ............... 10 8. BankPerformance ......................... 11 9. Borrower Performance ........... .............. 12 10. Project Reionships ......................... 12 11. ConsultatServices ......................... 13 12. Project D)ouetation and Data ..... . ................... 13 13. essons Leaned ......................... 13 PART II: PROJECT REVIEW FROM BORROWER'S PERSPE 1. Project Implementation ............................ 16 2. Benefit and Evaluation ................................. 19 3. Experience and esson....................... 22 4. Evaluation of Work of World Bank .................... . 25 Appendix ...... ........... 27 PART m: STATISTICAL INFORMATION 1. Related Bak Loans and Credits ............. ........ 29 2. Project Timetable .......................... 31 3. Loan/Credit Disbursmentss .................. ....... 32 4. Projet lema Iondicators ......................... 33 5. Project Costs and Financing ....................... . . 34 6. ProjectResults .. ........ 36 7. StatusofCovenants ......................... 40 8. UseofBankReseurses.. ............................. 42 This document has a estricted distribution and may be used by recipients ooly in the perfomannce of their ofAicial duties. Its contents may not otherwise be discsed without Wodd Bank authorizaton.  -I- PROJECT COMPILETION RPR * P1SHNG-CHAOH ARE DEVELOPMNW PROJC (LOAN 2579-HACRDI 166C)A PREFACE Ths is the Project Completion Report (PCR) for the Pishihang-Chohu Ar Development Project in China, for which Credit 1606-CA for SDR 75.7 million (75.0 milo alent at apprai) and Loan 2579-CHA fer $17.0 millon we approved an Jun 1, 1985. The Credit was fuily disbursed on Aust 15, 1991 and closed on June 30, 1992; the LAn was filly disbued on May 20, 1992 (except fDr $267.2? which was cancelled) and losed on October 31, 1992. Ihe PCR was prepared by the Acture perations Division, Country Deatn t HI East Asa Regional Office (rface, Evaluation Summay, and Pats I and Ml), and by Anhui rovince of Borrower (Part II). Preparon of the PCR was started following a PCR mission which vt Anwh in July 1992. The PCR is based on the finding of the PCR mision; zenve data provided duin and after the PCR mission by Anhui Province; tie Staff Apprial Report (U); the Dvopmet Credt Loan, Anhu Project and Agrcultua Bank of China A suevision ports; corwespondence between the Bank and the Borrower; and Itnal Bak Memoranda. The exceptional efforts of Anhui Province in assistng the PCR mssion and provig data during and after the mission are noteworaty and much apprecid.  B  8 iij  III r 411 Fl qiIi 1IiL iiII' Ii 114 I a 1f1ph1 aiii 1e I I ew1I.I  irii'41 PIA.L[j I @0 S I, 1w 0 111a111 2 filil Ipri huh I U  - iv - TChnc rplemenin ruired moblizadon of vitally th e ntre Anhul Watr Reso Bureau (AWRB) and could have been facilitated with a mo sectr-oriented Invten project delg and m drct Istitudona developmnt support for strengenig AWRB (Pt I, para SA). S. Project achievements generdly ec physical objectives specifed In the SAR. For Pibihg, constcton of ma can, brach cand and lawal can stuctures and earthworks were on avge 140 percent and 190 percent of physica SAR trges, respecdvely. For Chaohu, constuetion of earthworks and strucrs were well above SAR targets, and the Fenuangjlng Pumping Station was completed per design. Tho rural developmnt componets exceeded SAiL argets sually, especialy for the smaler components like seed procesing facilities, fish ursedes, and livestock breeding. Of the 54 rural credit subprojects, 17 have already repaid their loas, and only two sWbprojec failed (beca of management and markeig problms). The esmated ERR for the overall project at completion Is 27 perceat compared to 36 percet at appraisal, despe a substa deline in projedted rice prices. Project flood control iVestmnts averted damage of more tm double their cos in he 1991 floods (Part I, par. 6.1 and 6.6). 6. The main deviations from SAR tagets concern the Shendahe pumping sion (deleted), on-farm wurks (25 per shortl), construction of the Pishag rriadon waw comrol centers, establishment of the Chaohu Flood Control Center and facilities, and completdon of the m gement stduies (curry in draft) and technical assistance for Pishang and Chaohu. Provinc fds have been budget to complete on-fam works ad the Irrigation and Flood Conrol Cents and faciities. Compledon of maiagmen studies and faides, prormenF t of cmputers and ca equmn, use of tehical asstae and training components are important to maximize the retus rom the project and should provide lar ain for smal inve . Although the Provin expects to complete the mangement studies and filities nludIng equipmen procuement) with provincial fiuds, more priority shoud have been placed on these 'software and 'human capitalk compone during imentation (Prt I paras. 6.2-6.3). 7. Pisblhang was designed for an economic life of about 25 years, and Chaohu about 50 years which is norma for flood prtct facilites in China. For Pisuihang, net benef from project investm should be sustnable at curwny planned levels. O&M is adeate, and wator carges are collected in line with cumet policy and are sufffcient to cover expcted O&M costs. For Chaohu flood control facilities, however, there I no system for charging for flood protection and recovering part of Iae very large flood protecton benefi from the beneiaries. It is esal ta pvincia and loca governments provide adeqaWe budget for O&M of these facilities (art I, para. 7.1). 8. For Pishihang, the basic sunabilty of the system at current (fUl developmet) performane leves is not in quesdon, but long-run pufmance capability in tms of managemen and adjusment to hagig fute conditions may be. Much of the technial upgrading unde the project will provida the capability for bettr performa ad more  -v - flexibility, but measures under the project to strengthen management as envikged under the project were not completed (Part 1, para. 7.2). Findings and LAsons Lrned 9. Ihe major findings and lessons from the project are (Par I, para. 13.1): (a) project preparation should emphasize forlation and agreement an the dailed c',janlztional and stffing arrangements for impleetatIon; (b) preparation should include comnplete formlaon of project financing plans, including agreement on projected countepart fiuds required from all levels concerned; (c) local governmmits 6d ultmately farmers should not be required to bea the exchange risk of the Bank/IDA loan; (d) the user should pay" principle shoud contne to be followed In irrigation project, accompanied by increased user participation in project planning, implemenation and opersion; (e) flood protection investments should include arrangements for recovery of flood protection costs; (t) irrigation projects should include stituional provisions for unified rigation system manlagement (g) expanded use of LCB and contr g for local irigaton wodr should be included in Ature irrigation projects; (h) institutional support for strethening of egineern design, quality control, monitoring capability, and information management, and moe direct farmer involvemen in local level desig, layout and imple tion, shoud be built into irigation projects; and (i) commissioning proeres for Irigation projec should be speied during preprtion and strengthened.  -1-~~~ PROJECT COMTION RT 1INA AREADEVELOPMENT PROJECT (LDA 259CHCRDI 166CHA) PART I: PROJECT FROM BAKS PERSPECTIV 1. Projec Identity Name : PWl g-Chaohu Amea Developmet Project Loan/Credit Number: Loan 2579-CHA/Credit 16064CHA RVP Unit : East Asia and Pacific Regon country China sectr : Agiculture Subseto : Irigation 2. Backgrownd 2.1 Projec Overyew. Th Plhg-Chaohu Area Development Project (PCADP) was the first Bank Group project in China to assist large-cale sura irrigation and flood control. t was also the firs to integrate inent in major water reource infastructure wih area nd agricultr development investmt. Iheprojectwas Intd to rehabilitate, Improve and complete facilities for 320,000 ha of the Pishihag lirigation Project, which covers a total of 680,000 ha; enhan flood protction in the Lake ChaoWu area; and stengthen agricultural support fcilities and services covering a total of 734,000 ha In and aound the Pishhg and Chaohu areas. The tota estmaed cost of the project at apis was Y 670.9 milion ($263.5), of whih the Bank la/cret was to contbute 35 pecent ($92.0 miloan). Following apial in November 1984, 1he Board pproved the projet in June 1985, and the loan became offctive in March 1986. Project targets were modified digbdy in a mid-term review in 1989. Mhe project was completed and Bank fid fully disbused in June 1992, after a one-year exesion. As-built cost totailed Y 1,041.5 million ($273.5 millio), of which the Bank/IDA loan fianced 42 percent ($117.4 million becaue of the dqpeation of the do rlative to the SDR). 2.2 P y Context A primary poicy jusfcationfor the project was to raise grain production, mainly rice. At the time of pprasal in 1984, grain production in China had risen to over 400 mIllion tODns compared to 113 million tos in 1949. Because i's irrigated areas are more than twice as productive as raind ae, the expasion of irigation and flood proection was seen as a prmary vehicle to conthe tat trend and given a high prioriy by the govmenr The reladve surplus and low pries in itenatona grin markets in the middle and lat 1980s, and the ext of the posiive Ipa on grain production oft de houshold contra system, the raisig of grain prices, and other policy and ral reform measures, were not antcpated.  - 2 - 2.3 State policy to rduce investments in water resources as part of sector-wide budget cuts Inroduced in 1981 led to: (a) reduced invesumets In new ir on system; (b) Increased emphasis on raisiAg the efficlancy of exiting systems through rehabilat, upgrad and compledon of Irrigadon and drinage facilities and improved water management; and (c) transfr of the financia repayment reqirement for operation and manance (O ) to loa governmes and to Users. (During Iml on of PCADP, his transfer also came to Incude repayment responsibility for the Bank loan/credit which conibut to fOinancl problems for the projazt.) War conservacy projects In the 1960s frequently involved State contruction of major storge or divesion dams and main coveyam sysm, lean construcion of wate distrion networks to local governments which were generally weak fincily. Widtout adequat local xnding, the common result was failure to complet the distributon systems propely and substndard designs and construction. Compounding these capital Invesaent deficiencies were shortages of loil funds avaiable for O&M, even where the original struclures were satisfactory. These factors contributed to generally low irigation efficiencies ransng from about 30 percent to 55 prcent for surface system, and frequently system cold t supply thdr full command area. This was the uituation in Pishlhang, where only about 533,000 ha out of the 680,000 ha comm;nded could aually be served. 2.4 Flood protection for agricutur and industri enrrises has also long been considered a key policy for economic growth. However, devclopmeit of flood pwtecto facilities in the Chaohu area had, like irigation, suffered from lack of funds. Substnta maJor flood control works had been constructed over the last three decades to improve the ChangWiang (Yangtze) River dike, main drain of the area (Yuqi River), and flood Legulation faciities of Lake Chaohu. This erabled increased flood storage in Lake Cbaohu and ecpansion of culdvation and irigation for large areas. However, flooding was still a serious problem in 10 years out the lag 30 when high stages of the Changjiang River and Lake Chaohu occurred iulaneously, selective breching of dikes protectng these areas. Simily, the flood retention drawdown requireme for Lake Chaohu often meant shortage of irrigation water during dry years. Studies had been prepared for additional maJor works to enhance flood protctn and water supply for irigao However, local fiuds available were insufficient to cary them out, and Statoe fud were not allocated in the Plan for these purposes. 3. Projet ObjetIves and Descripion 3.1 Project Objetives. The primary objective of PCADP was to Ics the production of crops and other agricultr products in cental Anhui Province though imrovement ofthe Pig Irrigation Project, constuction of flood control facilties associated with Lake Chaohu, provision of rural inascture and sort services, and r of agement capabity for irrigation and flood control fatie. A sendary objecdve was to Increase rural income, market for agricultural products, and rural eploymen qpportnes tough provision of credit for financig development of local eepies, maiy Townhip and Village Eneri V). 3.2 Project Descripdon. The project comprised the following compon: (a) i vrnent of irrigation fadliti 3erving some 320,000 ha In the existing Pishm rdgation Project through Jdannae excavaion, constcion and strengthc JIg, selective canal lining, consrction and  -3 - reconstuctionof canal strmctures, and onstrucdon and improvement of on-farm ditch. and drains; (b) impvemen of flood control proton for 150,000 ha, drainage on 23,000 ha, and Irrigon water supply benfting about 220,000 ha through construction of flood anels, conutol gates, and pumping stat in the Chaohu aroa; (c) strengtening of other rural Infrastructure and agriculural support services over an area of 734,000 ha (stated as 918, 10 ha in the SAR due to the difference between local and standard mu size) toougbh, Inw all, construction of rur roads, rural electrificatin, county agricultural centers, local agricultural schools and research facities, 8ed procsing facilities, and fish hatcheries; (d) provWion of rural credit fir livetock taisimg, aquacultre and arpcesn; ad (e) te cal assistance and tang to hmprove management and operatal efficiency of the irrigation ?d flood control systems and improve the planning design of on-farm woras. 3.3 Projec Costs. Esimaed project costs at appraisal totalled Y 670.9 million (M263.5 million), of which the Bank/lIDA financed about 35 percent comprising an IDA credit of SDR 75.7 mUion ($75.0 milion equivalent) and a Bank Loan of $17.0 million. Water resource components (Pishhang rrigation and Chaohu Flood Control) comprised about 70 pacnt of base costs. Forei3n expendiur totalled &mut 32 percent of estimated bas costs. The table bdow ummaizes _tmated project cos by mponent Local Forein Total Local Foreign Total % of bass - (Y million) - - ($ million) - co Pishhag Irrigation 142.8 59.6 202.5 51.0 21.3 72.3 36 Chbou Flood Contol 147.0 48.9 195.8 52.5 17.5 69.9 35 Rura Developmaet 67.4 60.0 127.4 24.1 21.4 45.5 23 Rurl Credit 13.8 5.6 19.4 4.9 2.0 6.9 3 TainigA 14.3 5.3 19.6 5.1 1.9 7.0 3 Base Cost 385.3 179.4 564.7 137.6 64.1 201.7 100 Contingenies 77.5 28.7 106.2 44.1 17.7 61.8 31 r*1 Project A=t 42 208. au 181 MA Ma 265  -4.- 4. Project Deand az n 4.1 Pepaton, Conept and Dedg. n general, the projec was thicaly wel prpared and its scope and scal were appop an with the tehical caabUiies of the implemenng agencies. The primary componens, Pishihang and Chaohu, had been prepared technically in det several years before and wer clear In desig and concept. However, compared to previous Bak-suppord water conservancy pojects, mainly the North China Plain Project (Credit 1261-CHA), PCADP Project wa large, extenive, comlicated and innovative. It was the firs project to assist surfc Irrigation financed by the Bank in China, and it covere about half of one of the largest sue Irrigon schomes in China. It Livolved designp md construction of large works for one of the major flood ontrol fclides aWong the Chaillang River. In total it was vead over Lua and Cbaohu Prefectus and HN. municipality, covering all or parts of seven coundes in LuAn, four countie and a one municipat in Chaobu, and three counties and the municipality in Hefe. t comprised five indepe t mponent for which Implenon by many separte departmens an bureaus at different lvels of govermet had to be coordinated ad itgrated. It included a number of slt_ imvaonsrelatedto impl- n ent, system management, compebidding and coracing, tecical design, and project finfcng and conributions. And it was the fist large-scale, foreign-fnded project in Anhui. In short, although the project was technicaly wel designed and prepared and all the componenht proved to be important and viable, it was a difficult project to manage and Implement. 4.2 Undestanding of Project ConcWt and Deign. The tecical concepts and deig of the Project were well undertood, as the moor componen had been prepared several years aiier and the implentig agencis had undertamn sidmilar worms before. The project concet was wel understood by governmet and frmers alike. This dear undsag was evidenced by the volunary mobilization of some 300,000 farmer beneficiaries for Pishiag constriction plus another 300,000 for Chaohu. However, the inst onal concepts and design of the p .ir* especily for project management and countrat fiancing, were not well understood or established withn the goverment or among the beneficiaries bere implementation started. The rural credi component was well undetood and implemeed by the Agricultral Bank of China (ABC), as k followed stadard procedures aready established for Bak support of ru credt. 4.3 OrTtion and Ihe project was Iially conceived as a water conservany project. However, when the mangem system was set up on that basis, it proved usatisfactr. The project was too large and complex. Inly MWR considered a should be implemented through the primary provica line agency, the Anhui Water Resources Bureau (AWRB). The main nvestments were i water resources and were very large, and the fell resures of AWRB would hve to mobilized for he plementatio However, the project ;dso included aea development, and t was necessay to implemt the rural development and agricultal spport components in lose coordiation with the wat resource components. Ihe Bank theefore considered that a cordoinatg grup was needed to provide itegratd managemenlt, along the lines of the North China Plain ProjecL Project design per the SAR iuded establishment of a Stering Comme and a Pfoject Managemet Offic (PMO) for each level of govement, to be directly respondble for implem on of all cpe; the PMOs were to be bished In AWRB offices at vious lvels from the Province down to th counttowshlp. The PMOs were to coordint implementio and in effect would be respunsble for iL The prvicia Sterng Commitee was chaired by a Deputy  Govenr and comprised of line agency heads; it would provide policy-level guiance and coordination. This patten had proven effective in the North China Plain Project. 4.4 Even before the project began to Implment however, it was clea that thie PMO concept was not workable in this case. In the North Chin. Zlain case, almost all componns were under the Agriculture Mimistry which enabled unified manaement, whereas in this project irigation and flood control were under AWRB wbile rura development such as agricultural extension, support services, forestry, etc. were under the Agiculture Bureau and in addition rural roads and electrification had to be completed by their respective burea. Further, with the State policy of pushing Bank/lDA loan repaymet down to the lower levels of govemet, AWRB as a tehnical line agency was not in a position to arrange or ensure loan repayment by the benediciaries, and it had no revenue authority. 4.5 A Comprehensive Office in place of the PMO was therefore established at the provincW level to monitor and coordinate implemet by the various bureaus. Resposibility for local level implementation and contibutions (abor an counterpart fund mobilization) was devolved to the ounty and towntip governments. In general, the Comprehensive Office functioned as the secretari for the provincial Steering Commitee, which in effect becam responsible for overall implementation. The Steering Committee defined the tasks of the line agencies and put direct implementation responsibility onto Ce appropriate bureaus which were monitored and coordinated by the Comprehensive Office on behalf of the Steering Committee. Similar Comprehensive Offices were established at lower levels down to the county level to monitor and coordinate (and organize) acta inmplementation and construction by the offices of the various bureaus. These offices were under the overall guidance of the Provinci Comprehensive Office, as directed by the Steering Committee. Once constitted, ti patter of organization for implementation proved effective. However, it took time for this system to reach full operational capability, which delayed implementaton start-up. 4.6 Project iFnng. Similarly, althugh the genr project financig plan wa specified at appraisal, the total impact and drain on local financial resources was not appredated. At appraisal, collectives and firmers were expected to contribute nearly 30 percent of total costs, local and provincal goveraments another 27 percent, and the Bank 34 percent. At project completion, however, collectives and farmers had actually contrt direcy44 percent of total (doLlar) cost, and local govrnments only 9 percent, while Bank finacing acounted for 42 percent. 4.7 The burden at the local level, and therefore on farenrs and collecves, was compounded by State policy that required repayment to the State of the Bank/IDA loan by the Prvince, and hence the counties and townships, in hard currency and on somewhat harder terms than the Bank/IDA loan itelf. The burden was subsntially worsened with the devaluation the yuan, which fell from Y 2.8/S at apprais to Y 5.4/$ at completion and averaged about Y 3.71$ during the project period. 4.8 Thus, at completion, the total burden at the local level-local governents and collectives and farmers-was some 95 percent of total project costs in dollar terms. Of this, the farmers' share was 86 percent, comprising their 44 percent direct Oabor) conution plus 42 percent financed by the Bank/IDA loan which they will have to repay. Becuse the primary revenue base of the counties and townships is agriculture, and most of the counties are lready in deficit, almost all of this burden is now being allocated to collectives and ultimy to the  -6- famers. Although midgatd somewhat by eliintion of governmen amistave control on grain pries, the tota contribuon requWired fom famers i subantial. 4.9 The heavy fnancW burden on already weak coundes proved to be a s impedimnt to implmenon, and cod affect long-tem suslnabgity of the project If it Inerer with adequat buding for O&M. At appraisa, most of the countes were classfied as povety coundes. During their finial position weakened furer, and almost all had great difficulty in providing the necessary counterpart funding on schedule. Delay and shortago of counep; t funing was a consistent problem during implementaion and was perhaps the sile most Importat cause of the one year delay in project completion. To protec project investmes, it is important to find a way to do-link the weak financial position of the counies from funding for system O&M. 4.10 Analysis and agment on the details of source and use of counurpart funds for implementaton and on the repayment burden before apprais could have reduced the coteart fnds problem, or at least enabled preparation for IL However, the problem of requing local levels to bear the exhge risk of the Bank/DA loans, for which they were not prepared or equipped, would si remain. Iha added to the local financi burden, and may have adversy aected project design and the priority assigned to various components. Local and county finance officials prefered quick reum, high yielding invesme rater han nrasuue becu of the heavy repayment reWirements imposed by the State. 4.11 Factors A unt for Project Success. Project design had specified establishme tof the SeingCommtee at the provinclalevel. the end, thisproved to be a major source of streg for project Impltn enabled both of the rroblems disussed above-lack of a suitable orgalmagmeplan and shrtage of counterpart funds-to be dealt with effectively. Wi th faiue of the PMO oonept, the Steing Committee becam de fact responsible for impl_ton, and by its composion it had sufficient audwrity over the relevant bu s to hat each bureau permed the assigments allocated. The provincial govement a relieved the shortage of coutepart fn by temporariy absorbing part of the financial burden on local governmens during implemenion. he extent to which these liabilities will finally be reimoed on the counties and ultiaely on the farmers is not yet clear. However, the deficit posiIon of most counties i unlikely to change in the near fe. 4.12 Innovatlons. ProJect design included a number of importat innovations, in additon to the hmovative change In project management and organizaton with regard to the Comprehensive Office as Aescrbed above (see pa. 12) which was instituted ealdy during implementation. A major invation was the use of LCB and conacts for local construction; the tadiona pattern was for the imple agency (e.g., AWRB) to simply assign specific works to local constucdon bureaus. The use of LCB and contracts reportedly produced competition which generally raslted In better quaity and lower costs, saving on average about 10 percen Another inttutional inmovation was the establishment of the project unit in WMR to help provide liaison betw IDA and the project. That unit assistd in settig up of the Comprehensive Office and sent officers to assist in project _insecto five or six times. In addion, tds project integrated rigaion investm wih agrWuural support seavices, In contras with normal practice in China, which was to implement Irrigation and ariculture separately with little or no coordinatioa.  -7 - 4.13 lhe project also included Importantteical innovations. Design Improvement were incorporated into construction of the large Fenghuagjing Pumping Station, and into rehabilitation and completion of the Pisihang Igaton system espeially wth regad to communications. ITe Innovations at Penghuangjing proved quite effective during the 1991 season when flood's were severe. At Pishihang, better communiation and water cotrol should facilitate more flexible, reliable and efficient system opeation. However, project Investments for improving system management were not completed, which will limit the benefits possible from technical improvements of the system. S. Projedt 1mplementation 5.1 VarIances between Planed and Actua Impleon. Delay in completion by one year, a total increase in yuan costs of about 55 percent compared to appraisa (the tota dollar cost overrun, however, was nominal), and dropping of a myjor flood control component (the Shendanhe pumping station) were the major vaiances between planned and actual implemenion. These were taken into account and adjusted for in the project's mid-term review in 1989. It is doubtful that any changes in project design or prepation would have significandy affected the outcome, with the possible exception of beter preparation related to project managemen organiztion and financing as described above. 5.2 Overall, the project finaly achieved its primary objecdves despite these problems. Strong support by the provinci government, AWRB and the Agricultural Bureau combined with effective leadership by the Compreensive Office and project management, enabled speedy adjusmt to changing conditions and national policies which affected the projec This mimized adverse impacts on the implementation f ce and achievemets of the overall project. 5.3 The completion delay was due to a number of causes. Some of the most Important were institutional and financial. It took about one yer to establish a filly fincond project management orgaizaion and system after the orginal management system filed. The consistent shortage of local counterpart fnds slowed progress; indeed, one rationale fr te delay itself was to stretch out ("reschedule") the counterpart fimding burden on the counties. Excessive "float' due to slow ribsentof expditures added to the cunteat fnding problems. This was the first Bank proect In Anhui, and many new procedures had to be developed and leaned, especially with regard to procurement and flow of fumds. Bank requirements and procedus for procurement of materials and equipment through ICB were new, as was local coutracting for construction through LCB. Due to the repayment r imposed by the State, flow of Bank loan funds was through the Finance Bureau, rather ta rough agency budgets which is the norm for government expenditur; this added another element of bureaucracy to dea with. 5.4 On the technical side, severe floods In 1991 caused heavy damage, epecialy to the irrigation works, which had to be repaired. Design and Imple on capability at the local (county and township) level was overei , compared to the high d q uired under the Bank project. The decision to delete the Shendanhe pumping station from the project was not taken until late 1989, and time was required to select, plan and carry out the sbtiuo works, manly for irrigation. The project works themselves wer extenive and wsated, and some were large and difficult.  -8 - 5.5 Dufg IlemeIon, total costs esal fom Y 670.9 million in the SAR to Y 1041.5 million (in doll, however, the cost esc on ws only about 3 percen). Ihe large hicrea In yun costs was due Imay to devalon of the yuan, more rapid price escaation than exected (local Ifaton averaged some 18 percent annually between 1987-90, compared to 3 percent assumed at appraisal), Increased costs for matrs and supplies with market prices rather than fixed state prices, eased uni cost for labor, delay in project completion by a year, and underesma of te quantiy of earthwork required for sevr componens. Except for the las. em, these facors were largely beyond the control of the project or the provincial govenmen. Despite the yun cost Increases, the project was completed eentally as planned, except for the Shendanhe pumping station which was deleted. 5.6 The Shendarhe pumping station was deted after further analysi sowed that its costs wold be high compxred to its econom benefits. At the time of apprais, It had been considered by the Province as the first phase of a project (unrdated to PCADP) to transfer Yangze River water t the Huai River basin for new irrigation and urban waer supply, but in late 1988 the Stae decided nt to include tiat project in th Eighth Plan. Although Shendahe would provide flood protection benft in extm floods, the provincia governm did not consider the pumping staton justified at this time wihout the irigaton benefits as well. In dition, the State did not contribute to the flood protection works, unlie irrgation, and with the already severe problems of increased costs and the shortage of local counepar fundig, pvncil and local resources wer stretched to the limit. Ihe Steeing Commie therefore decided to posone the pumping stationa substte five Irriation subprojects in is place. 5.7 Ac_ons, Dedsions gnd Fators wich Affected plo. The main acto and decions Impacing on implementation were the State decisions to require lo repayment by provina and local governents, promote a market economy, and exclude from the Eihth Plan the intebasi wter transfer scheme for which Shendanhe pumping station was a key component These are all broad policy decisions which were justified on nadonal grounds and could not bave been avoided or, in the context of this ptcular project, foeeen. Project management had to adjust to them, and project implementation plas were revised accordingly in a mid-term review in 1989. No other actions or decisions by the Province or project management would have significany mpgated the Impact of thes canges. 6. Pljct Resuls 6.1 lnnl Tare. The project geraly achieved the objectives specified In the SA For Pihang, couction of main canal, branch cl and lateral cn struct and earthworks were on avera 140 pecent and 190 percent of SAR targets, resweively. For Chaohu, constcton of earthworks and stuctures were well above SAR target, and the FenghuaWing Pumping Station was complted per design; the Shendanhe Pumping Sttion was dropped for economic reasons. ITe area development components (includig rur ads and ectificaon) eeded SAR tgets substailly, especially for the smaller components like seed prosing facites, fish nurseries, and livetock breeding. Rurad credit was prvied for S4 subprojects-43 agmprocessing TVEs, 10 fishery and animal husbandry TVEs, and one animal husbandry state enterpie. 17 subprojects have made early rqmyo of their loans; two subrojects failed becas of maagement ad marketg problems.  .9- 6.2 'he main dwvons from SAR targets concer t Shendanhe pumping station (deleted), on-fam works (25 percent hortIl), costuction of tie Pishag water control centers, establishmen of the Cbaohu Flood Conrol Center and facilities, and compleion of the management studies (curntly In draft) and technical assitce fo Pishihang and Chaohu. ProvinW funds have been budgeted for AWRB to complete the on-farm works and the Flood Control Center and fities duing FY93, and the govermnt has assured da the sudies will be completed. In addito some 17 percet of the work remaining on Pishihang laterals and sublaterals and 8 percent on earthwork for Niudahe and Xihe are scheduled for completion durig ths year. 6.3 The shortl in compledon of the manage sdies and fWities, technical aistance and t components have long run implicatons, as these activities were intended primaly t promote bett oper ationa pefmance in the futre. The maagement studies for Pslhg and ChaMou wen not completed by project dosing, althugh preliminary report have been submitted as requied. Ihe studies and technical asistac were expected to define efications, reqiret and opeating plans for these em which would then be finced der the project, and the project included fiacing for cmica, compute, buildings and faities for the magement centers for Pishiag and Chaohu. At project closure, however, the studies and management filitites had n bee completed and the equipment (e.g., cmputers and communiations) had not been procured. Improved techniques, eqipment, commuications, and management ifmation support are Importa to make best use of the large capital investments under the project and dws d provide sbsil performance gains with readvely smal invsten. Similaly, provisions for tng and specialized consulting services were substantally underuilized compared to the SAR. Th"ese "*software and human capitalT invesments evidently did not cary a sufficiently high priority dun iple Ai However, the Province aporn to the monogement studies and faites and equipment and expect to complete them with provincial fuds. 6.4 Agrc1ultul Beneflts. In term of agiuur output, overal crop ensity exceeded aps estimates slghtly. Yields and poduction fDr all crops were well above the *wWhout project case assumed at appraisal. However, for most crops they were margsinally less ta apprais estimates a fiamers diversified to animal husbandry and rAce inputs in response to lower market prices in recent years, especily for rice. Ihe value of production for animal husadry substantially exceeded SAR dmtes. ibis value incease is due in part both to project animal husbandry actvities and url support (including roas and electification) and als tO increased lirgated productivity of food and feed g . It also reflects the response of farmers to reducei crop price and profitability for rice in recent years with the elimination of centra goverm conol of grain prices. Tlmber production (cure and potentia) also sustntaly exceeded SAR es_a. 6.S FaoodControlBenfits. IheLaeChaohuflood p ocomponprvided large benf during the castrophic 1991 floods. Ith main pumping station, Fenghuanhing, was newly operational at the time, and the Nidanhe Diversion was opeatonal at about half of design capacity. AWRB estmates dtat, even widt these limitn, the damage avered exceeded some Y 700 million, compared to the total costs for the componet of some Y 350 milion. lbe PCR eoomic analysis incudes only the annualized value of those beneits based on flood recurnc probabilities.  - 10 - 6.6 Economic Rate of Return (ERR). Despite a substantial decline in projected rice prices, the economic analysis of the project upon completion shows a healthy ERR of 27 percent, compared to 36 percent at appraisal. The actual physical achievements at full development (e.g., yield and irrigated area increases and flood control benefits) almost equaled SAR estimates, despite lower farmgate prices for rice in recent years and the Impact of the 1991 floods. In general the value of livestock production and products was significandy higher than esmated in the SAR, which helped to compensate for reduced returns from crop agriculture. ER and switching values (assuming a 12 percent annual discount rate) for major components are shown in the table below. ECONOMIC RATE OF RETN AM SWITCING VALS ERR (%?1 -it iu (1) SAR PCR Costs up Benefts down P _ang Irrigation 33.0 25.6 33.0 25.2 Chaohu Flood Contol 34.0 27.5 40.5 28.7 Support Service Area 46.0 30.4 32.0 24.3 Total Proiect 3I0 _ ?. Projed Sustalnablity 7.1 Pishbang was designed for an economic life ot about 25 years, and Cbhohu about 50 years which is normal for flood protection facilities in China. Net benefits from Pdishihang Imvestments should be susinable at currently planned levels. O&M is adequa, and water charges are collected in line with curet policy and are sufficient to cover aepected O&M costs. However, for Chaohu flood conrol facilities, there is no system for charging for flood protection and recovering part of the very large flood protection benefits from the beneficiaries. Periodic local labor contrbutions can cover some costs, but there are major cash costs for operation of the pumping faiities and river dredgng to maintain diverion capaciy. The problem of cost reovery for flood protection facilities is a nadonad issue, and it will probably have to be resolved at the nationa level rather thn for Chaohu alone. In the inteIm, however, it is esenti ta proviiat and local govements budget adequaely to cover O&M of these facies. 7.2 For is=, the basic sustanability of the system at current (full developmen) performance levels is not in question, but long run performance capability and adjustmet to caging fumre conitions is. Much of the technical upgrading under the project wM provide the capabilty for better performance and more flexbilty, but the measures to egi management as envised under the project have barely begun. These measures are eusenal to gain maxImum advantage from the capital investments.  7.3 A key mangement issue concerns responsibility, authority and acountability for peformance of the irrigation system as a whole. Although O&M management was not deat with in the project, it will be critical to improving future system performance, along with the physical investments. At present management is famented among diffrent levels of govnmet-towships, counties, prefectres, and the Province. Whenever a cana Crosses an I*I i I t9ve boundaryib for O&M of that canal (regardless of Its size) pas to the next higher level. This means tuat the same type of canal may be managed by two diffrent levels of govemment, and that the management requirements of the canal are not necearily lined to managemen capacity available which general increases at higher levels. This makes it difficult to maintain consistent management standards throughout. 7.4 Moreover, main canals are typically controlled by the provincial level (the Pishihang General Adminon), branch and subbranch canas by the prefees and mnicipalities, and laterals and sublaterals by the counties and townships. However, there is no overal entty with the authority at all these levels to ensure fficient management of the entire system, the responsibility to maintain uniform stadrds of O&M througbout, and the acountabfiiy for system management and performance. A more unified model, which could sdll retain the beefits of decentralination and local initiative, would be to form a sigepose irrigation district at the system level which would be a fedeaion of individual frmerun water user groups based on hydralic units rather tan adminiaive boundaries. Individual hydruic unis and the distict would be financially self-sufficient The irrigation distt and hydraulic unis (farmer groups) would be managed for overall system efficiency and equity, rather than on the basis of ative (e.g., county) boundaries. The distict could function as a financially self-sufficient enterprise, selling water to the farmer groups which in turn would resell water to their members/users to cover costs. A major objective would be to reduce the finacial bnrden on local goverments and delink igation O&M from their weak fian condition. There are many cases in other countries where similar decentized insutional models for rigtionanagement are fuctioning efficiently and could provide examples for Chinese expes to see in operation. 8. Bank Performance 8.1 Ten Bank supervision missions visited the project from 1986 through 1991, plus the PCR mission which visited the project in July 1992. In some cases, the missions included several members as needed to cover the multiple activities under the project. The missions adopted a constructve attitude and assisted with changes needed in the project, in addition to reporting on status and progress. Bank mission support helped with two key changes-the management adjustments needed as a result of the establishment of the Comprehensive Office in place of the PMO, and the deletion of the Shendanhe pumping station and subequent -1016-d- of irriation wors. Bank missions also highighted importnt local issues whih interfed with progress, especially the shortage of countepart funds, and provided technic and odher assistn on standard implementati matters such as prcement and audits. 8.2 Bank support for technical preparation was good and crntributed to good project design which was important to the success of the project. However, insftional a gements for project management and project finacing were not fully prepared and agreed before implemenXtaion, and indeed the terms of central government onlending were not setted at the time of appraisal. Tis proved to be detrimental to project implementation (see paras. 4.10.4.17). Substnti efforts during supervision were exeed to help rec these  - 12 - shortco ins r'nlcally, the mmngemen problem was due In pant to takin lessns from a previous Bank project with the applicaton of the PM10 concept which had proven successfil in the North ChIna Mlain Project. 6.3 In general, the Bank povided good gian on project management, effective use of loan resources, procurement of goods, osulants, study tours and training; reponded quicidy to queries of the Comprehensie Office and problems eEcounwed; and helped solve problems. Although it liaised with the project unit In MWR, cunicat with the unit were not alwas efficient, and at tmes the unit was not sufficiely informed about Bank missions and could not send staff to accompany them. 9. Borrower Peformance 9.1 Anu Povince (and the concerned prefectm , counties, and townships) showed a strong commitment and support for the project from beginning to end. During preparation, the Province decided to include the Chaohu Flood Control component, despite a decision by the State not to contbute to that compone; these investmet subsequendy proved their worth during the severe 1991 floods. In the early stages of implemenion, ithe Povinc had to redesg the project managen system and establish the Comprehensive Office in place of the PM(O aRer fiding tha the PMO concept was unworkable; ths required estabishment of an entirely new operating pattern in which the Comprehenive Office, which had little actual power itslf acted as the seciat on behalf the Steei Committee. Later, the Province had to make mnjor decsions to delete the Shedanhe pumping statn and chose nbstie Irigation fclies, and to delay project compledon in order to reduce the local finncial burden. These difficult decsions we made epedously and ratlly. The provind goVement as contbuted addiona cunept fundin in pla of the fncially weak oounties as necessary to keep implenion on schedule. The flexibflity and pagmaim dmonstad by the Prwince in dealing with these issue was essentia to projec suces. 9.2 Project management was effetve and efficient, especialy ater establis of the Comprehensive Office. Uniquely quaified and effective staff were cho to head Xt Comprehensive Office, and leadship of the key line agencies, epecialy AWRB and the Agricultr Bureau, were fuly committed to projec objectives and worked eficety with the Comprehensive Office. During impleion, the prwvinci Steing committee, the Comprehensive Office and the n agencies worked togeer effectivy at all levels to proe strong, efective leadership and overcome constrais and obstructions. 9.3 At the local level, support was also strng. Some 600,000 people mobilized for constuction of Pishang irrgation and Chaobu flood potection wor. In many cases, whole vilages moved to the work site for the constuction season. Tbis direct conibuon by the beneficiarie toed about 44 pacent of total projec coso. 9.4 At the State level, MWR set up dt small project unit in the Planning Deatmet. t provied liaison with IDA and the Pronce, and staff from the unit ved the project five or six tmes during impl  - 13- 9.5 The support provided t the Banks PCR mission ln Jy 992 by all vels of govenment was outg. Governmet of ficia woe wei prepad, disussions wer fiak and exhaustive, field visits wee useful and efficent, and do n was exteive. 10. ProJect 10.1 Working reaiosps between the Stering Committe, the Comprehensive Office, the line agencies, and the various levels of govement involved were good and effective. The level of cpation and temwork demonsrd during imple ion was impressive, especialy comidering the number of separat components and g es olved. This can be atuted to both the high quaity of the leaders involved and the stn highlevel support provided by the provincial government. Relationships between provincial authorities and MWVR, and between Bank staff and project magement were also good. 1. Consultn Services 11.1 Consultants were used for specldized studies. Desig work was done by desig institutes. Consultants were not needed for geneal project imp- - on sWort 11.2 The work done by consultants for the studies was good. To help guide the sudies, a joint study group was fomed at the provicia level. Originally, the project included eatra consultants for some of the studies. However, tis was consid ed unneessary, and as agreed wih the Bank, these resources were utilized for local consultants and more study tours and t in foreig countries. 12. Project Docmentaon and Data 12.1 The project required four legal ageement: the Development Credit Agreement, the Loan Agreement, the Anhui Province Agreement, and the ABC agreement. All proved saisfaoy and presented no problems for Omple ton Oiginaly, prouement of smaller motors, pumps and cement was to be ICB, but this was chged to LCB due to the excessive time required for ICB. 12.2 Preparation and desipg documents were of good quality and adequate for appraisal. In general the SAR provided a good famework to establish the project concept and guide implementation. Documention and data for the PCR were complete and of high quality. 13. Lessm Learned 13.1 The project provides a number of lessons which may be usefl for futue irrigation investments: (a) Project preparation should inude formaon of detailed orionaland staffing arrangemens for impleTi These shouldbe analyzcd and Weed by all parties concerned befioe implan starts. (b) Preparadon should also include complete for aton and analysis of project finncing plans, includingprojected cuntepart contributions required fm all leves (especially coties, ownships, collectives, and fmers) and thei  - 14- projected ability to pay. The counterpart fimds issue is especially critical at the ounty and township level, since most are already financial weak or in deficit. (c) Local governments and ultimately farmers should net be required to bear the exchange riks of the Bank/IDA loan and make repayment in dollars. They do not have the resources for this fimction; the State goverment is bete equipped to hedge against exchange risks and manage foreign exchange. The present requirement skews decision making during project design and implemenion. Furthermore, the repayment requirement allocated to the local levels and fmers should be more closely geared to their capacity to pay. It is counterproductive to saddle counties and farmers with debts thy cannot afford. (d) The "user should pay" principle encourages local accountability and shoud continue to be followed for cost recovery in irrigation projects like Pishihang; In this case, the users share of project costs totals some 86 percent. However, if users are to pay such a large share of project cost, they must have greater Involvement and participation in the planaing, implementation and operadon of the project. User participaton should start from the early stages of the project and include organization of the users into rrion units designed to ensure efficient communication and cooperation between users and project authorities. (e) Projects with flood protection invesmens like Chaohu should include arrangements for recovery of flood protection costs. Cost recovery should at least cover O&M. (f) ligaion projects should include measures to develop and establish a uniied model of irrigation system management which provides for the necessay authority, responsibility and accutabiliy to ensure efficient and equitable opeaton of the system as a wbole. The measures should also promote decentralization and local iniatve. At present, O&M management is fragmented between the various levels of government. One possible model is a unified, financially self-sufficient irrigation district at the system level which would supply water to hydraic operating units at lower levels (e.g., 'water companies" managed by farmer groups). Og) Expanded use of LCB and contracting for local irigaton works should be included in fit irrigation projects. () Provisis for institonal support to streg engine design, quaity control, monitoring capability, and inf aton management (including at the township and county levels) should be built into irrigation projects. In addition, projects should also make specific provisions for more direct farmer involvement in decison-maling for local level design, layout and implementation. (i) Commissioning procedures used for irrigation projects should be strengthened. A commissioning period should be specified for all components and subptojects (e.g., a lateral) during which time modifications would be made to correct deficiencies, complete minor works, and meet operational specifications. A spcific budget line for commissioning should be included in project costs to  3. El.  - 16 - PART II: PROJECT VIEW FROM BORkOWER'S EC 1. PROJECr IMPLEMENTATION 1. PROJECr SIZE Plshihang-Chaohu area development project, which was flnced World Bak loan and the domesdc cotrpa fond, was a larg-scale projec for Infastucuo of water conservancy and agite in A" provn during 7th five-year deome perd. Ihe project covered the middle and weter parn of Anhul, including 13 couwti and municipalities, which are Luan, Shouwdan, Huoqiu, Huoshm, Jinzhal and Shucheng counties in Luan p_efe , Wuwed and Hansa counies and Chaohu municipality In Chaohu preecture, and FeLix and Changfg counties in Hefel municipality. total projeat investmet was 985.52 mfillion yuan whic. are lised as follows: Wodd Bank loan: (equivalet to) 411.28 million yuan MNistry of Water Consevancy & other Departmets: 62.24 million yuan Anhui Provincal Govement: 88.30 nillion yua Counties: 116.26 million yuan Labor lpt 304.44 milion yuan Of this tol investmt, 722.58 mIllion yuan wer used for watr consvcy component, 177.12 million yua br agicultur component, 3.6 mIlion you for project managem cost and the remaing part was paid for interest. 2. PROJECr CONTENTS The projec was divided into two componet: water conseanc and agricultu developmen. Water conservancy componet included the rehabiitaton of Pishhg iaion project and the hanming of Chaohu Lake basin. Pishhag Irrigation project: rehabiltation of 6 main canals which were PMhe, Shiho, Wadong, Waid, Qidong and Shulu; rehabilitation of 6 subman canals which wer n, Hechapu, Baoyi, Qngiang, Lunan and Lub1; rhabilaion of 205 branches and subbranches and completion of laterals and ditches contolling 4.97 million mu; strege ning of some medium and smanl reservoirs and bishm of some pumping stadons. Chaohu Lake basix oonstrucdon of Fenghuangin Pmping ation and regulation of Nluuhe and Xihe Rives, I.e.'one so and two rivers.  - 17 - Agrilture development component included mru road, rur electricity, land levelling, improvement of low-yield land, affinostation, animil husbandy, fishery, extenson and usage of agricUlture credit to develop agro-products processing and other township industry in the project area. 3. IMPLEMENTATION PROGRESS A. Water conservncy compont a. Completion of rehabilitatbn of 6 main canis ad 6 submain c s, inclutig silt cleaning, landslide treatment and contuction of bridges, cuvert and check gates. b. Completion of rehbilitation of 205 branches and subbranches controiling 3.91 million mu and compleion of rehabilition of laterals and ditches controlling 4 million mu. c. Completion of strengthening of 9 medium reservoirs and 365 ma teservoirs(type L 44 and typelI: 321). J. Completion of r4Sbrblshmen of 20 pumping stions (over 500 W). The above mentioned works included the completion of 45.97 million W earthwork, 42000 Irigation structres, 269 drainage struct and 10300 bridges. Fenghuangn Pmping Station and its aurte stuctes in Chaohu Lake basin wer completed early in 1990. Its insIled capacity is 14800 KW. ts dedg drinage and Iriga discge is 240 cms and 200 cms respecively. Niunhe floodway was straihtened and Its dikes were heihened thickened after the completion of 20.45 mllio , iludi construction of Tongcheng control sluice, Xinqiao control sluice, Baldu highway bridge, 6 ractor brIdges, 109 auxiliary structr, 68 pumping stations and 407 cossIng structures. s discharge has bee raised from 170 cms to 480-780 cea. Xibe River was reguated after completion of 17 million 1M earthwork, inlluding constction of 1 highway bridge, 25 pumping statin and 125 auxIliary structus. After the construction of Shentanghe Pumping Station was postoned, the following works were added nd completed: 1. 6.46 mIllion yuan invested on Haggbei main canal in Shucheng county. By the end of 1990, 800,000 W earthwork, 80 intak gates, 1 highway bridge, 6 tra bridges and strengthening of 1 bridge had been completed. 2. 6.5 million yuainvested on Fengxi main canal. By the end of 1990, 2 million M5 earthwork had ben comploeed. 3. 1.8 million yun Invested on refurbishment of Chepnan pumping station in Lujiang county. All the work has been completed.  - 18- 4. 1.5 million yuaninvested on Songan pumping station in Foix county. By the end of 1990, 250,000 M' earthwork and a mumber of strucur had been completed. S. 80,000 yuan added to Youfanghe aqueduct in Huoshan county. ihe construction was started in last winter and finished in April of 1992. The irrgation benefit has already been gained. B. Agricultre development component According to the requirements in the appraisa, the following im were carried out and completed: a. Rural road: 60 roads totalling 725 KM, including 68 bridges, 2150 culvert and 3 ferries. b. Rural electrity: 1143 KM trsmission lines, 14 substaions and 2 smal bydropower stations. c. Land levelling and improvement of low-yield land: levelling of 47,000 ha (705,000 mu) and improvement of 30,000 ha (450,000 mu). d. Afforestaton: new nusery 22.22 million saplings/164 ha (24.62 million mu), afforestaion of 65.383 mfllion trees/14,529 ha (220,000 mu) and side aforettion of 3.24 milion trees. e. Animal husbandry: increment of fine breeded 3406 pigs, 374 cows, 160 sheep and 42960 domesic fowls, and cumpletion of 45000 MW stucres. f. Fishery: 17000 mu fish ponds, 21 aquatic breeding farm, completion of 55700 W structures and production of 918 million fries. g. Seed: newly construction and expansion of 10 county seed companies and 34 seed branch companies, 6486WMseed storehouse, 10500 M2threshing floor, culvation of 10620 tons of seeds/3242 ha. h. Extension and education: 2 extension stations In Chaohu and Luan pr e, 7 county extension stadons, newly establishment and expasion of 2 agdcultural technology secondary sdhools In Chaohu and Luan prefecture, expansion of 61 wto extnion statin and establism of 287 township extension stations, completion of buling area of 90300 k4, Including 2181 new instruments and equipments. C. AgWture credi he agricultu credit amounted to 2.93 million SDR, which were mainly used for animal husbandry, fishery and agro-product processing in the project area 1By the end of 1990, 54 crdit Items had been established to complet the investment of 70.79 mIlion yuan, of which the project credit was 29.71 million yuan, with 3.93 million USD drawn from World Bank.  - 19- D. Material Procurement According to the loan agreement, 46.83 million SDR and 8.7 million USD were arranged for material procurement. In tie 5 years of this project, 81 cotracts were signed to have paid 46.83 million SDR and 4.76 million USD for procurement. The remaining 3.94 million USD were adjusted to be disbursed for earthwork. The procurement was completed smoothly. E. Technical assistance and training According to the need of the project implementtion and approved by the World Bank, 10 special subject consultancy items were given to the domestic research institutes and universities, 4 study tours to the United States, Thailand, Netherlands and Denmark, including 25 persons, and 4 training tours to the United States and Australia, including 15 persons, were carried out. 2. BENEFrT AND EVALUATION 1. BENEFIT FROM WATER CONSERVANCY COMPONENT A. After rehabilitation of Pishihang irrigation project, the incremental and improved rrigtion area has reached 4.79 million mu, achieving an itrigation guarantee rate of 80%. The stability of conveyance cross-section of canals and improvement of irrigation facilities have brought about larger flow and water supply ta before and reduced the loss and waste. Along 36 KM Shulu main canal from its headworks to Jiepai cana, the water conveyance ie has been shorned from the past 24 hours to the preset 19 hours after rehiablation. By the end of July of 1990, the water supply had totaled 183 million M', a& increase of 31.22 million M3 for irrigation xompared with 152 million 1 in 1983. ITe water conveyance time along Shihe c ntral canal has been shortened by 3 to 4 days aer rehabilitation. Anfeng irrigation area along Waxi main canal in Shouxian county has 13 branches with the design irrigation area of 8727 ha (131000 mu). Due to the incompletion of irrigation works, serious water leakage in canals caused 30% water loss and only 60% of design irigation capacity was reached. In the rehabilitation, 4466 structures were built to testore the design irrigation area According to the investigation on 2 branches, 2 subbranches and 12 laterals and ditches within 4 townships, in 1987 before rehabilitation, the irrigation area was only 3745 ha (56000 mu). In 1989 after rehabiltation, the irrigation area reached 4367 ha (66000 mu) and the grain yield per mu was raised from 403 kg to 472 kg, leading to an increase of the total grain output from 22700 tons to 30900 tons, a net inrement of 8254 tons. Calculated by 0.6 yuan per kg, 4.9524 million yuan were gained, which was 1.63 times the cost for rehabilitation of canas. In Luan preectre, after reabilitation, the irigation ara has been increased by 120000 mu, the improved inigatio and draige areas 1.2 millon mu and 30000 mu respectively.  - 20 - For 120000 mu new irigation area, the grain yield would raised by 400 jin per mu, retultig ih an increa of 48 million jin. Calculated by 0.37 yuan per jin, 17.76 million yuan would be gained. For 1.2 mIllion improved irrigation area, the grain yield would raised by 200 jin per mu, resultig in an increase of 240 mnllionjin, equivalent to 88.8 million ytan. lhe above two itms are added up to be 106 million yuan each year. In Chaohu Lak basin, the constuction of Fenghuangjin Pumping Staton and the regulation of Niutunhe and Xihe rivers have formed a high standard flood control system and raised the flood contol standard of 2.55 million mu to 20-year frequency standard and the irrigation guarantee rate for 3.45 million mu to 90%. In 1990 and 1992, severe drought occurred in Anhui, the scheme c f 'one station and two rivers", together with Pishihang irrigation project, played an important role to reduce losses in agriculture. In 1991, an extrem large flood hit Anhui. Ihe scheme of 'one station and two rivers' also played a great role to figh again the flood. Only Fenghuangjin Pumping Station drained out 1400 milion M1 flood in more than 60 days. As a result, no polder of more han 10X0 mu was damaged. According to rough estimate, the damage to polders was reduced by 420000 mu and a loss of 714 million yuan was avoided. C. Social and ecologic benef a. Dispute among farmaes for wat use and waste of labor, material and fiancial resources have been avoided. b. The communicaon and circuation between cities and rural area havebeen lmproved. The economy in cites and rural area has been flourished. c. The ecologic enviroment has been befied and improved. 2. AGRICULTURE DEVELOPMENT COMPONENT A. A great increase of gain, oil seed and cotton In 1990, the total grain output in Pishhg-Chaohu project area reached 4.387 milLion tons, 754000 tons more compared with the base year, achieving an increase of 20.8% and an anmual incase of 3.8%, 1.8% higher in comparison with the area wiihout project. Te total oil seed outut reached 358000 tons, 58000 tons more compared with the base year, acheving an increase of 18.5% and an annual increase of 3.5%, 2.1% higher in compaison with the area wiut project. The yield of oil seed per mu was 87.9 kg, 7.9 kg more compared with the base year, achieving an increase of 9.5%, 16.3 kg higher in comparison with the area withoutproject. Ihe total cotton ouput reached 31 millon kg, 11.56 million kg more compared with the base year, achieving an increase of 59.4% and an annual increase of 9.8%, 3.1% higher in compaison with the area without project. The cotton yield per mu was 66.4 kg, 24.4 kg more compared with the base year, achieving an increase of 58%, 12.4 kg higher in comparison with the area without project.  -21 - B. Rapid development of smimal husbandry and fihery In 1990, in the project area, the output of pigs was 25.4 million heads, an increase of 17.6% compared with the base year. The poultry outut was 38.26 million, an increse of 7%. Ihe total mea ouput was 218000 tons, an increase of 84.9% compared with the base year. Ihe aquatic output was 37000 tons, an increase of 15.6% compared with the base year. C. A great increase of total inoome in agriculture and net income per capita for farmers Calculated by the cufrent price, in 1990, the total income in agriculture in the project area was 7164 million yuan, an increase of 84.9% compared with the base year and an anmn incea of 13%. The net income per capita for farmers was 451.9 yuan, 75 yuan higher in comparison with the area without project. D. Social benefit a Annual inrease of commercial products supply In 1990, the project area supplied 1.566 million tons gain, 26700 tons cotton, 37000 tns fish and 210000 tons meat, achieving an inse of 40.8%, 22%, 15.6% and 63% respectively compared witi the base year. Ihis increased supply enriched the people's life in cities and rural area, flourished the market. and stabflized the society. b. The improvement of the life of farmers The invesiation on 765 farmer households in the project area has shown that compared with 1988, in 1990, 729 tiled houses, 145 TV sets, 286 small tractors and other fiiaing tools, 107 bicycles and 26 tape-recorders were newly increased. At the same time, the conditions of education and medical & health work were improved obviously. c. Increse of tax income In 1990, the project area submitted the tax totalling 123.62 million yuan to the state, 34.646 million yuan more compared with the base year, achievig an increase of 38.9%. d. A big development of township industry In 1990, the total outut value and profit & tax incom created by the townshp industry in the project area amounted to 145.66 million yuan and 82.45 million yuan respectively, an incr of 150.9% and 119% compared with the be year. 3. EVALUATION OF THE PROJECT Pis_lg-Chaohu project was staed in 1986 and basically completed in June of 1992. The constuction practice for 6 years has shown that the project concept is cofrect, the design is reasonable, the implementtion is smooth, the constuction quality is good and the benefit is  -22 - remarkable. It is a successful project to have reached the aim World Bank and Anhui provincial govenmen esablished. 3. EXPERIENCE AND LESSON 1. ORGANIZATION AND LEADERSHIP ARE THE KEY POINT FOR PROJECr IMPIEMENTATION A. The establishment of project offices should be based on the actual condtions. Pishlag-haohu project was different from the North Plain Project and the other project. This project had its own special features such as large project size, wI4e project area, big investment and a great miber of difficult construction works. The project scope involved many deparmes and engineering professions. It was difficult for only one department to undertake this project. From the actual need of the project constuction, Anhui provnial governmen decided to perfom a unified managemnt and leadership by the relevant departmenft. In the provincial government, a leading group for the foreign financed agriculture project Was formed, with deputy secretary of the provincial party committee and vice-governor as its head and deputy head. The heads of the planning commission, wat conservancy bureau, agriculture bureau, finance bureau, audit bureau and agricultre bank at the provincdal level were the members of this leading group to join the diectg and management work for this project. Under this leadig group, a provinal project office was established to handle the routie affairs such as circulation of directions and documents, coordinaon, supervision, service and extnal communication. Th above mendoned 6 provincial departments concerned had its own project offices to be resposle for the planning, procurement, collection and management of funds, disbursement, submission of accounts and drawal of money, auditing, agricultre credit and management of implement of the water servacy and agriculture cowmponents. The work of these project offices was guided by the provincial project office. During the past sever years, the provincW project office took the following measres to coordinate the operation of the whole organization system: 1. The regular meetings were held to exchange inforatio, discuss the solution of problems, summarize the work and arrange the tsks. In general, the overall project meeting was held once a year, the meeting of the provincial leading group once a month, the meeting of heads from the project offices of the relevant provincial departmts once a month or even once half a month in the crucial period of the project implementation. At the prefcture (municipality) and county level, the meetings for the project were also regularly held. 2. The heads of the relevant provincial department and staff were often organized to go to the site for supervision, guidance and solution of the problems. 3. Tle staff at the local level were often invited to have a talk about the project, present their suggestions and exchange information for the improvement of the project work. 4. he infmation brief and the documents were edied and circulated to exchange information.  -23 - S. The work visits to the relevant department wer made to strengn tho communcation. The practice has dso dth such a management method is good, resultg In a norma and effectve operation. B. Leadership is the decisive fctor for project work. Anhui provinci party oDmmittee and goverment atached greaportn to Pidhlhang-Chohu project and established a proviial leading group for the foreign financed agricultre project to guide, coordinae and treat the important affirs. In consideraon of lge area and heavy constuction of Pihng-aohu project, the provial party cMMitte and governmen dedded to add deputy heads to Luan and Chaohu preftu, Hefei municipaliy and 13 pro:jet coundes specy for the project work. At the same dme, the local poject leading group, offices and consuction headartes were established under the responibility system of the heads of preecture, municipalities, counties and headqa . The reponsibility and ts were clearly defined for each level. In the project implementAtion period, the heads at various levels often listened to the report about the project work, study the solution of the problems and go to the construcdon sites for superviion and guidance. In a word, they firmly grasped the project csuction from the beging to the end to guaranee the smooth implemenon of the project. In the project imple on peiod, Ministri of water consv , agrxltute and finance and the State Plmng Commission sen seveald missions to Anhui to check the project work and render their support and help. It was also an important factor for the smooth project C. Coordination of the releva departm Is an important condition for project work. Phang-Chohu project was a systematc project involving many departme such as planning, fiane, audk, gricture bank, aricultue, water sacy, mm on, power supply and environment protection. In the project implemeon, any obstacle in any deprme would affect the nmal operation of project construction. In the pat s8ev years, the project offices and these relevant deparm established a good and clse reation and help each other, to co their efforts to the projecL Prtice tlls us a it is very Important for a project to have a high-efficiency organizaton whih can operate normally, a powerful leading body, high-quality staff and well coredepartments for its iplementl 2. PREPARATION SHOULD BE WELL DONE BEFORE THE PROJECr IMPLEMENTATION BefJre the project implementation, much preparation work were needed, incuding eVploration and di, supply of materIas and equipments, fimd collection, cmm spply of electriciy and water, biddig and cnrctiag, oaizati of construction tam, ec. Any Iaequate preparation would affect the normal project implentation. n g , prpartion work for each component of Pihihanlg-Chaohu project was done early, folly and  -24 - acvely. But, some wodks wee not well prepaed and their construcdon was influenced. For tance, becau Luau prefecur er consvany burea and some county waer conseanm bureaus did not have enough desig resource for rehabilitation of laterals and ditches, the design and review lagged behind, which fected the cosrucdon. Later, they took measures, such as contracting of design, loymnt of the outside design resources nd the training of design persons, to push the desg nd reviw work to an active position again. For another instance, the dlayed sie preparatn once influenced the construction of Fenghuangjin Pumping Station. AU tee facts proved that the preparation work is very Important for construction. Any Inadequae or untmly peaion will delay the constuction, affect the constuction and cause the waste of labor, matis and money. 3. COUNTERPART FUNDS SHOULD BE ENSURED Project onsuction should be gunteed by the sufficient fiuds. Any shortage of the funds wil ca thproje constrctonto be csin the air. Since Pishlang-Chauhu project adopted a form of first submitting the accounts and then receiving the disbursement, he domesic countepart funds must be first used and then the disbursemet fom World Bank could be ained. In the ollecdon of funds, the courpart fud at the county level was the key point. Becas the economy of the project area was undeveloped and most counties belong to the old liberated area and poor area, the collection of funds was very difficult. In the past sevea yeas, great dis were made to collect the funds from every possible cane, such as from county finnce, from agricultu fund and from on-farm works construction fud and from beneficaries and water fe. Finally, the collection of coopart fimd was basically completed. But, the burden on the county fince and frmers was heavy and even beyond their capability. Therefo, for a lae project of water consevany and agriculture development, it is hoped dtat the state will conott more fimds tD lessen the burden on the local government. Farmers can contribute labor instead. Only a dhough solution of the problem of funds can guarantee the project conuction. 4. COMPETITIVE BIDDING AND CONTRACTING IS AN EFFECIIVE WAY TO GUARANTEE CONSTRUCTION PROGRESS AND QUALrTY Duri-g the past 6 years, in geal, all the consuction works both in water conservancy and ricultur, Including laWe and lky works and single building consatcton, were contracted on a fixed cost trough competive bidding on an equal ground. The accepace checks hae shown that the contracted construction works through competive bidding were completed with less cost, short period and high quality. Some construction works without being coned though competve biddng were delayed and built at a higher cost. S. MATJERAL PROCUREIENT IS VERY IMPORTANT FOR PROJECT Only &h. tdmy supply of materals and equipments cant ensure the smooth project on. In the past svea years, the biddig group headed by the provincial planning comission compleed the pmorement task and accmulated the following valuable experience: a. establfshog a coordinated and high-efficiency organization;  -25 - b. perming p m according to the gu spedfied by World Bank and In coopeation with the epet of Wodd Bank; c. cayg out a large collct amount prur to reduce the biddig pric and co8; d. making predictin of madkt and grasp the suiable proement tim to obtain the e. cnsidring dte advace technology, adaptabilky and unhsalWity to sdect the reasonable technica _ds for eay use, repair and absorpdon; f aeurging and orazing the en ises in the province to join the competive bidding for the pur of promote the imprvemen of the management and producs quaity. 6. AUDrT SERVES FOR PROJECr CONSTRUCTION AND SUPERVISION BY AUD1T AND NOTARIZATION IS FULLY PERFMED Mm principle of audit wa tat acoordi our releva w and acts as well as tie of Wodd Bank, n orll audk of the whole projedt should be cied out and the audit rport should be submitd wiot the requr time In the acta pactie, Au povincal audit burau adhered to the following 3 combinato: a. A combinaton of the principal audit and th locd audit: Ibe provincial adit dqmtmet did not only coodne the comprehensive audit but also orgnize th loca audit to fam a sytmwi ork. b. A combination of exten nn md intenl suvisio The powblems found in the aud wer reflected by the inteal rport and suitably eqxsed in the audit rpor submitod to Wodd Bank t cas its attention to them so hat the dmely solution of them ca be sekedx c. A combbiaon of rotne and emhaized audit: On the basis of routin audit, the prvia audi dqetnt orgnized th prefecture (mand cty audit dep to cry out the emhasized audit over Chngfeng, Lujiag, Luan, Shouxin and Wuwei counties and Fen agjin Pumping Stadton to obtain the first-hand ifmaion, perform a supevisi befrehand ad in the constuction proce and promote the development of audi work 4. EVALUATION OF WORK OF WORLD BANK In die --e-Ald-n piod of s ni hu project, the ofcis in Agruture Division of China of Wod Bak alwas renderedte atento cncen, spport and help to ths projecL As *t usual practice, Word Bank sent th missons to he projec area every yea to cbek and guidethe project work, and in th working pros a close relation and fiedly copaion hae bee ftoed between the eperts from World Bank and the leaders of Anhui provincl governme and at varou levels and th staff Of project offices.  -26- a. Bre the approval of PiSg-Chaohu project, World Bank sat the msion ompised by Messrs. Smith, Wiens and Tay to Ps_hihang h ation area rinestin and appraisl thee t in 1984. Their thorouh wotk laid a fondation for a correct ppisal. Dudng their aasa vis, according the requm_ent of Anhui prvincia gover t and Chaohu prectr, thdy actively supported the eablihmen of the project to has Chaohu Lak bain and play a big rol in he water conservany constuction between ChMalang River and HusIh River. b. Before the at of the proJect imp l Wadd Bank sen the werts to hold seminars for us about project moniton g and evaluatio finani mmen and analysis, and appltion of miaome_rIn the project. hy rendr us th valuable exo per for the sg of the project. c. In the projet Impleato period, Wodd Bank st Mr. Gunartam and othr epr to he proect area many tmes tD check and guide the ptoject worL They wored very serioudy and thoughly both In the office and on the conucton site. Ihey prent the guidance both in otechology and project managemet for the large cons uc wor or the on-farm work. For instac , they gvo fallg and swpport about the of unit pre of bor, e nto of Shenag Pumping Station and addition of 5 Orjc of watwnervancy d. Aftr the compledon of thei project, Wodd Bank sent a mision headed by Mr. Rldinger to eamin th completion of the project. During their wodridng tay in our provic ad the proje area fw more thaw n 20 days, they held dcussios wth persons at varis leves, lisned to the report about the project and Wen to the field for many times. They did not only help us ummaiz, te experiem and lessons, but also prsnted eir vakable opink anld ron _uddn e. In the project Imh lm natIo perod, required by the appraisa report, sv ovee study tor and traing were orgazed. Wodd Bank always gave us help in contact and arangemen nd provided convden fr thes overs study tours and taini which widen our thining and created chanc for to absorb the good experience in foreg counoes.  - 27 - APPENDDX AN ANSWER IN RESPONSE TO QUESTIONS RAISED BY MR. REIDINGER IN REVIEW OF PART II OF PCR ON OCT.29 OF 1992 1. Relation between the engineering me_a and policies and th project benefits The benefits of Pishihang-Chaohu area developm project are defined as the economic, social and ecologic beneft. These benefits were controlled by the engineering mmeur and also affected by the policiei. The engineeinmeasures were the constructon of water coserancy and agricul infastructures. The policies are the adjustment of gicultr structure and prices of agrojproducts. As far as the beneft of a project are concerned, sometimes the engineering mesmures occupy a dominatng position and sometmes the polces play a decisive role. According to the investigation, in 1990, the tota grain output in the project area was 4.378 million tons, 754000 toDns more compared with 1985 before the project, an increase of 20.8%, of which the ennerig measures mae up 10.6% and policies 10.2%. In comparison with the area without project, the increae was 10.6%. In 1990, the total ol soed output in the project ares was 358000 tons, 58000 tons more comrd with 1985 bere the project, an increase of 18.5%, of which the engieering measures made up 5.2% and policies 13.3%. In comparison with the area without project, an increase was 5.2%. In 1990, the total cotton outut in the project are was 31 milion kg, 11.56 million kg mor compared with 1985 before the project, an increase of 59.4%, of which the enginern mesures made up 31.4% and policies 28%. In comparison with the area withu project, an inaease was 31.4%. We conider that the great benefits of Pisa-Chaohu project came mainly from the enieern meaures, not mainly from the policies. 2. Relation between the baefits from water conevancy component and agriculture componen The benefits from the water onavancy component and the agriculture mpon are interrelated and camot be sepaated. Ihe implementin of war conservancy component has increased the water conveyance flow, promoted adoption of the reasomable Irrigation sstem, expanded and improved irrigation area and raised the rigation guarantee rate. The constuction of water conservancy has also widened the flood prtcto arem and enhanced the flood conol standards. The benefits were reflected finaly by the increase of the yield of grain, oil seeds and coton (not including the benefits from the agricuture component such as hmproven of low-yield land, seeds and fertility). The good beneit In agture and hiher income gin by farms could incease the input on the imprvement of waer consvaq and achieve more benefit. herefor, the befts from the water cnsq component and the agriclture componeat are intereated, affect each other and rdy on each odt. 3. Necessity of routine check by mission set by World Bank in the proJect Implementation period We consider that in the project Implementation period, it is necessar, for Wodd Bank to send missions to ihe project area to heck the project word. According to the practc of the project implemenion for 6 years, we have the following co on the Wodd Dank msions:  -28 - a. hs msions can sapervise and promote the projet imp t b. These missions can strenghenthe comucation and udsandingbetweenWorld Bak and the loan borrower. hese misions an help Wodd Bak to know the project prge In dme, and through the dicussion between the both sides, tho problem wih ocu in the proJect implemeion can be solved In tm. c. These missiow can render direct help and guide In tehnology and in management For instance, these missions provided a great dea of help and guidance to the riow of the desig of Shentanghe Pumping Staion, study of modern comm-olcation In Pishihg Irigaton are and optmization of management of flood control in Chaohu Lake basin, iof technica semis and overe study tours and training, study of the estblishmentof the pojed mona t system od preparation ofthe projet compledon rt. d. in h imp o of PiWsChaohu project, the rdt betwee Word Bank and us Wa dose. Te friendly c ation uing u supr wa carded out, which deepeed the mUal aI gd promted friedship. Thruh te bard work of the both sies, the project implemen was smooth and successfb.  - 29 - PART El STAISTICAL N 1. Related BaMk Loans andlor Credits Loanlcredit title Purpose Approval Statue Cosnlts North China Plain Agri- Drainage iSprovenent aad PY8I Proj ect PCR com- cultural Project salinity control on completed pleted Cr. 1261-CBA 200,000 ha for crop pro- duction. Gansu Provincial Develop- Irrigation component m7 u n d e r Satisfactory ment Project serves 57,000 ha for Implem n- Ln. 2812-CHA/Cr. 1793-CBA settlement by 15,000 tatiot famlles. Xinjtang Agricultural Irrigation component FDB8 U a d * r Satisfactory Development Project serves 32,000 ha for food Itplemen- Cr. 1764-CMA and fiber production. tation Northern Irrigatlon Proj- Irrigation and dralnage 1XS8 U n d e r Satisfac- ect for 200,000 ha In Inner Implemen- tory, lack Cr. 1886-CMA Mongolia and 36,200 ha in tation of local lingx1a. counterpart funds Shaanxi Agricultural New/Improved irrigation n89 u a d e r Satisfac- Development Project for 125,000 ha, potable lmplemen- tory, lack Cr. 2017-CMA water supply for 135,000 tation of counter- people, fishponds cover- part funds ftg 2,100 ha, 15 live- stock farms, 9 seed pro- cessisg plants, and 3 agroprocessing plants. Shandong Agricultural Improvement/expansion of 189 U a d * r Satisfactory Development Project 5 irrigation sebemes, implemen- Cr. 2017-CM provision of Inputs end tation support services, date and foodgrain production, livestock development, grassland improvement, arroprocessing, and shrimp and fish culture developmnt. Hebet Agricultural Devel- Rehabilitation of irriga- FY90 U n d * r Satsefectory opment Project tion structures, con- Saplemen- Cr. 2159-CM struction of 9,950 shal- tation low tubewells, provision of farm inputs, rehabili- tation/construction of 4,000 ha of shrimp ponds, construction of 700 ha of fishponds, construction and expansion of cotton m4lls, construction of 2 fertllizer plants, and construction of particle board mll and paper mill.  -30 - 1. lted ank Loesm andlor Credits (cont'd) Loea/credit tAtle Purpose Approval Status Comments Senan Agricultural Dovel- mproveunt/expausio of m91 U n d o r Satiefactoqg ouent Project 4 diversion irrigation implemen- Cr. 2242-Ci schemes, construc- teation tion/rehabilitation of 17,400 veas, 'coustrec- tion of draiusge and flood protection, provi- ion of farm inputs, development of 1,000 ba of fishponds, and agro- processing. lrrigated Acultural lmprvemntjcoastnacti/l 191 U a d e r Satisfac- luten"ificatio Project completlon of canals end Saplemen- tory; became Cr. 2242-CHA drains, pumping stations, tation effective tubllos, surface drain- 09109191 aSe, structures, etc.; provision of agricultural aupport servies; and institutional devlopment support. Tarim hle Project Irrieation and dranage 92 U a d e r Satisfac- Cr. 2294-C for 200,000 ha, hydro- laplemenl- tory; became pmer developmet, agri- tation effective cultural and Uvestock @1/26192 support services, and river ecosystem restora- tion  -31 - 2. Prooect TZtntab1e Item Date plamed Date actual Identification (Project Brief) 06120184 10115/84 Preparation 1/A 06/28/84 Appraisal mission 11/02/84 11/02/84 Loan/credit negotiations 03/15/85 04/22/85 Board approval 06/13/85 06111/85 Loan/credit signature - 10/08/S5 Loan/credit effectiveness - 03/03/86 Loa/credit closing 06/30/91 06/30/92 Loon/credit completion 12/31/91 12/31/92  -32 - 3. 1OLfU DbykagwUld a=hk semester tSioA1 dgbiaumn In4 (OOlOOe - AMtul as K Actual so I endngt App A__ _ _ _ of qpproval of tot BAR CrsRit LO -oon Ig Total December 31, 19S5 7.00 - - - 0 0 Jue 30, 1986 22.30 5.25 - 5.25 24 S December 31, 1986 41.20 16.14 - 16.14 39 14 June 30, 1987 52.20 33.51 - 33.51 65 30 December 31, 1987 0.40 38.23 - 38.23 56 33 JuQ 30, 19U 71.90 51.R5 - 51.85 72 45 December 31, 198 79.30 64.77 - 64.77 62 57 Jne so, 1989 81.70 72.60 - 72.60 89 63 December 31, 1989 7.*40 82.46 - 82.4 94 71 June 30, 1990 89.60 96.43 3.86 100.29 112 87 Dsesber 31, 1990 92.00 96.43 9.08 105.51 115 92 June 30. 1991 92.00 96.43 16.19 112.62 123 SO December 31, 1991 V1I 97.69 16.19 113.88 124 99 Jue s0. 1992 V/A 97.69 17.00 114.70 125 100 W LA data as of June 30, 1992 (ena secoud semester 1192). Cr. 1606-CaH, SDB 75.7 millio ($75 llon equivalent) at the tie of negotiation, April 22, 1985. La. 2579-CMI, $17 million. votes Loan estaturo closing date va extedd once frau Jun 30, 1991 to June 30, 1992. The credit was fully d