Announcement of One Million Four Hundred Thousand Dollar Credit to Bolivia for Livestock Development Project on December 17, 1969

• INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET. N.W .. WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 IDA Press Release No. 69/41 Subject: $1.4 million credit to Bolivia December 17, 1969 for livestock development project The International Development Association (IDA) has approved a credit of $1.4 million to Bolivia. The credit will permit the continued flow of credit to ranchers for a livestock development program, initiated with the help of a $2 million IDA credit in 1967. Bolivia's lowlar.ds, which cover about two-thirds of the land area, offer excellent opportunities for increasing beef cattle production, particularly • the Department of Beni. The first stage of Bolivia's livestock development program was confined to expanding production on 160 commercial beef cattle ranches in the Beni. In addition to increasing the output of beef cattle both for domestic consumption and export, the purpose of the project was to promote the long-range development of Bolivia's beef cattle industry by demonstrating the advantages of modern ranch management techniques and by strengthening institutional arran.gements for providing financial and technical services to ranchers. The program has been launched successfully. The demand for loans by ranchers, and their readiness to cooperate with specialized technicians in the preparation of ranch development plans, resulted in a much faster connnit- ment of the proceeds of the first IDA credit than was originally expected. The Bolivian Government has applied for an IDA credit to help finance the • second stage of its livestock development program. Pending the appraisal /more IDA P.R. No. 69/41 - Bolivia-Livest~ck - 2 .. of this new and larger project, the interim credit of $1.4 million will pre- serve the momentum of livestock development lending under the efficient tech- • nical organization which has been set up. The terms of the new credit and the administrative arrangements are the same as those provided for under the earlier credit. It will be for a term of 50 years, including a 10-year period of grace. It will be interest free but will carry a service charge of 3/4 of 1% to cover IDA's administrative costs. The Governmen't will relend the proceeds of the credit to the Banco Agricola de Bolivia. Loans to ranchers will be repayable in 12 years, in- cluding 4 years of grace, with interest of 12%. The project will be admin- i.stered by the Banco Agricola, which assists ranchers in preparing ranch development plans, screens loan applications, supervises plans for which loans are made, and provides other technical services to participating ranchers. The total cost of the interim program is estimated at the equivalent of • $2.3 million. The Banco Agricola has sufficient funds to provide the necessary technical services and will continue to provide short-term loans for working capital. The new credit, therefore, will be used only for long-term loans to ranchers and should be connnitted in 12 months. These loans will be used for investment in fencing, corrals, water points, light equipment and tools, b8.rns and housing, selected pasture improvement and breeding stock. Goods for on-ranch development are purchased by ranchers through normal comner- cial channels. - 0 - •