Announcement of Five Million Five Hundred Thousand US Dollars Loan for Agriculture in Zambia on June 1, 1970

• l NT!::.Rf\JAT!ONAL BANK FOR c:ol\IST}1UC'Ti0f\g AND DE\/ELO 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank Press Release No. 70/32 Subject: $5.5 million loan for agriculture June 1, 1970 in Zambia Zambian fanners will be encouraged to enter commercial farming under a project being assisted with a World Bank loan of $5.5 million. By training Zambians and settlin~ them on connnercial farms, the project will further the Government's policy of increasing as rapidly as possible the number of Zambians engaged in pro- duction of cash crops, as well as expanding agricultural productivity. About half of Zambia's four million people are engaged in agriculture, but connnercial crop cultivation, mainly of maize and tobacco, has been undertaken • mostly by non-Zambian farmers. Their numbers have declined in recent years, how- ever, and as a result commercial farm output has gone down at a time when Zambia needs an increased supply of maize, for local consumption and for export, and could increase its foreign exchange earnings by exporting more flue-cured tobacco. The project consists of training and settlement schemes to be carried out by the Tobacco Board of Zambia, a gover~~ent agency under the Minister of Rural Development. A training unit at Mukonchi, in the Central Province, which runs a four-year training program in commercial crop farming will be expanded to take in 50 Zambian farmers a year. Successful graduates and other Zambian farmers with comparable experience will be settled on some 270 farms, each of about 170 acres, allowing cultivation of 20 acres of tobacco and 40 acres of maize. The development of these farms is part of the project and, once settled, farmers • will continue to receive guidance from the Mukonchi staff. The project will also /more Bank P.R. No. 70/32 - Zambia--Agriculture • - 2 - include the development of about 30 farms of 500 acres each, which will be made available to Zambian and non-Zambian fanners capable of running them without outside help. Zambian farmers to be: settled under the project will purchase 99-year leases to their farms; non-Zambian farmers will rent their farms. The project is estimated to cost the equivalent of $11.4 million, of which $5.5 million will be financed by the Bank loan, which will be used principally for the purchase of farm machinery and equipment, vehicles and building materials, and for construction work. The remainder will be provided by the Govermnent, by coD111ercial banks which will assi,st farmers participating in the project with seasonal credits guaranteed by the Government, and by the tenant farmers. • The loan will be extended to the Republic of Zambia for a term of 25 years, including six years of grace, with interest at 7%. The Government will make the proceeds of the loan available to the Tobacco Board. - 0 - •