Document of F COPY The WorldBank FILE Ov FOR OFFICIALUSE ONLY Repot No. P-2921-BEN REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT PEOPLE'S REPUBLIC OF BENIN FOR A SECOND FEEDER ROADS PROJECT December 4, 1980 This document has a restricted distrlbution and may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disctosed without World Bank authorization. Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized
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Document of F COPYThe World Bank FILE Ov
FOR OFFICIAL USE ONLY
Repot No. P-2921-BEN
REPORT AND RECOMMENDATION
OF THE
PRESIDENT OF THE
INTERNATIONAL DEVELOPMENT ASSOCIATION
TO THE
EXECUTIVE DIRECTORS
ON A
PROPOSED CREDIT
PEOPLE'S REPUBLIC OF BENIN
FOR A
SECOND FEEDER ROADS PROJECT
December 4, 1980
This document has a restricted distrlbution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be disctosed without World Bank authorization.
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CURRENCY EQUIVALENTS
Currency Unit - CFA Franc (CFAF) 1/US$1.00 - CFAF 210CFAF 1 Million US$4.762
FISCAL YEAR
January 1 - December 31
LIST OF ABBREVIATIONS AND ACRONYMS
CARDER Centre d'Action Regionale pour le DeveloppementEconomique Rural
DRDR Division des Routes de Desserte RuraleDRP Direction des Routes et PontsITC Inter-ministerial Technical CommitteeMDRAC Ministere du Developpement Rural et de l'Action
CooperativeMTPCH Ministere des Travaux Publics, de la Construction
et de l'HabitatSONAGRI Societe Nationale pour la Production AgricoleUNCDF United Nations Capital Development Fund
MEASURES
1 kilometer (km) = 0.62 mile1 square kilometer (km2) - 0.39 square mile1 square meter (m2) - 10.76 square feet
1/ The CFA Franc (CFAF) is tied to the French Franc (FF) in the ratio of FF 1to CFAF 50. The French Franc is currently floating.
FOR CIFFICIAL USE ONLY
BENIN
SECOND FEEDER ROAD PROJECT
Credit and Project Summary
Borrower: People's Republic of Benin
Amount: SDR 5.5 million (US$7.0 million equivalent)
Terms: Standard IDA terms
ProjectDescription: The proposed credit would finance a three-year program of
feeder road construction and maintenance which is nowestimated to comprise:
(a) construction by force account of about 700 km of feederroads;
(b) maintenance of about 1,200 km of feeder roads; andtechnical assistance to the Feeder Roacds Divisionwithin the Ministry of Public Works for carryingout civil works, project monitoring, staff trainingand the preparation of future feeder roads programs.
Benefitsand Risks: Project benefits would accrue to farmers who will have
year-round access to markets for their surplus production,and transporters in the form of savings from reduced vehicleoperating costs. Institutional strengthening would also be amajor benefit. Project risks are limited.
This document has a restricted distribution and may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization.
Financing Plan: The proposed credit of US$7.0 million would finance80 percent of total project cost net of taxes, i.e.,all the foreign cost and about 62 percent of localcosts. The Government would finance the balance ofUS$1.7 million.
(In US$ Million)EstimatedDisbursements: FY81 FY82 FY83 FY84
Annual 1.0 2.5 2.0 1.5Cumulative 1.0 3.5 5.5 7.0
Economic Rate of Return: About 20 percent.
Staff Appraisal Report No.: 3050/BEN December 1, 1980
INTERNATIONAL DEVELOPMENT ASSOCIATIONREPORT AND RECOMMENDATION OF THE PRESIDENT
TO THE EXECUTIVE DIRECTORS ON A PROPOSED DEVELOPMENT CREDITTO THE PEOPLE'S REPUBLIC OF BENINFOR A SECOND FEEDER ROADS PROJECT
1. I submit the following report and recommendation on a proposeddevelopment credit to the People's Republic of Benin for an amount invarious currencies equivalent to Special Drawing Rights 5.5 million (US$7.0million) on standard IDA terms to help finance a Second Feeder Roads Project.
PART I - THE ECONOMY
2. The latest economic report on Benin (Report No. 2079-BEN, issuedin May 1979) was the result of a basic economic mission which visitedthe country in fall 1977. The paragraphs below are based on this report,but include updated information. Annex I provides basic country data.
Introduction
3. After independence in 1960, a period of instability' characterizedby frequent changes in Government prevailed until the revolution in 1972which brought to power the military Government of President Kerekou. Thenew regime took immediately steps to replace the foreign domination ofthe modern sector and strengthen the Government's involvement in the agricul-tural sector. These measures initially disrupted the economyr since therewas an inadequate number of trained Beninese to replace the departingexpatriates. However, the Government also pursued conservative financialpolicies which resulted in budgetary surpluses and the maintenance of,thedebt service ratio at less than 7 percent.
4. Benin has now enjoyed a comparatively long period of politicalstability under a tight, centrally controlled one-party system. Followingthe adoption of a new constitution Lieutenant Colonel M. Kerekou was recentlyconfirmed President of the Republic for a three-year term by a newly electedNational Assembly. Mr. Kerekou has in turn appointed a civilian dominatedGovernment.
5. The nation is poised for a period of moderate growth propelled bymajor investments in the industrial sector. But Benin's near term prospectsshould be assessed with caution because they are dependent oln a few keyfactors: strength of the Nigeria and Niger markets, success of key indus-trial projects and continuation of a prudent budgetary policy.
Recent Economic Development
6. With a population of 3.3 million people and a GNP per capita of$230 (1979) per annum, Benin remains one of the least developed countries asdefined by the U.N. Over the 1975-79 period, the country enjoyed an average
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real GDP growth rate of 3.7 percent and a sound public finance position.Exports are limited (US$130 million per annum) and little diversified (mainlyoil palm products, cotton, and cocoa). A large resource gap, 20 percent ofGDP, is shown over the 1972-78 period according to Central Bank statistics.The gap is, in fact, smaller due to the substantial volume of informal,unrecorded exports, primarily to Nigeria. Also, an important part of theremaining shortfall is financed by a sustained inflow of workers' remittancesand capital grants. Therefore, medium- and long-term borrowing makes up foronly about 13 percent of the actual resource gap.
7. Agriculture, which employs about 70 percent of the population andgenerates 39 percent of GDP, has not substantially increased its output overthe past decade. With respect to export crops, cotton peaked in 1972 at50,000 tons but has since fallen to around 15,000-20,000 tons. Palm oilproduction continued to increase until the mid-1970s, but output has beenreduced since a severe drought in 1976. Institutional changes, insufficientfarmgate prices, lack of financial resources and the absence of technicalassistance are the main reasons for the unsatisfactory performance of exportcrops. Foodcrop production, although beset by many of these problems hasfared somewhat better with sustained demand from Nigeria. The situation ofthe sector in general is slowly improving under renewed Government supportthrough producer price increases and less interference with market forces,and better climatic conditions.
8. The industrial sector is still undeveloped due to a lack ofskilled manpower, smallness of the local market and institutional con-straints. It employs less than 2 percent of the labor force, contributes 11percent to GDP (1979) and consists mostly of agricultural processing andimport-substitution activities. The sector achieved an 11 percent annualgrowth rate during 1972-76, but slowed down to 4 percent during 1977-1979because of a fall-off in demand from the Nigerian market. Currently, Beninis beginning to exploit its natural resources through several major indus-trial projects, the Onigbolo cement factory (limestone), the Save sugarplant and the Seme offshore oil field.
9. The tertiary sector (mainly transport and commerce) accounts for41 percent of GDP (1979) and employs almost 40 percent of the labor force.The port of Cotonou has traditionally provided access to the sea for land-locked Niger and the western part of Nigeria. The Niger traffic throughCotonou Port rose from 180,000 tons in 1973 to 529,000 tons in 1977, andtotal transit traffic including Nigerian traffic rose to a peak level of900,000 tons in 1979.
10. There has been a significant improvement in the central Govern-ment's current financial situation over the last decade. The chronic cur-rent budget deficits of the 1960's, financed by French Treasury trans-fers, were eliminated during the first half of the seventies. During1976-78 the budget registered current surpluses averaging a high 23 percentof current revenues. The Government has controlled the growth of currentexpenditures, which did not increase in real terms during the 1972-77
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period. The 1976-77 surplus was due to the sudden rise of tax revenuesresulting from the growing transit trade to Nigeria and also, to a lesserextent, to the development of Beninese industrial activities. Some level-ling off or decline in public revenues related to the Nigeria trade, com-bined with expected heavy demands on the Treasury for investment projects,will probably tighten the budget in coming years. In 1979, Governmentresources were mobilized for an accelerated implementation of the largeprojects and a deficit equivalent to 12 percent of total revenues openedup.
11. Prices have been kept under control and the overall rate of in-flation has been limited to 8-9 percent in 1978-79. The increaSed economicactivity induced by the start-up of major industrial projects is likely toexert continuous pressure on prices in the next few years, with an inflationrate of 10-11 percent projected for 1981-82.
12. The Government is committed to broad-based socio-economic policies,but a key concern hitherto has been to keep wages and salaries Low becauseof limited public revenues. In real terms, both public and private sectorsalaries have declined. Cash incomes of the farmers may have increasedslightly, the losses resulting from the drop in cotton production probablyhaving been made up by increased exports of maize to Nigeria. Thus, Beninis one of the few countries in Africa where the urban-rural income gap hasnot widened in recent years. Education is one of the Government's toppriorities. It is in the process of implementing reforms aimed at bothadjusting the education system to the needs of the country, and reducing thehigh cost of formal education which absorbs 33 percent of the Government'srecurrent budget. Health facilities are still poor, and the social indica-tors for Benin (literacy, life expectancy, etc.) remain well below theaverage for low-income developing countries.
The 1978-80 Development Plan
13. A Three-year Plan (1978-80) was issued in October 1977, settingout the Government's economic goals. Its stated objectives are to raise thegeneral standard of living, to achieve independent national direction ofeconomic policies, and to promote broad participation in the conception andimplementation of economic and social changes. Investment allocationproposed in the Plan favors large-scale projects. The major items are: theCotonou Port extension (US$50 million), financed by IDA and seven otheragencies; a 40,000-ton sugar project at Save (US$210 million); a 500,000-toncement plant at Onigbolo (US$159 million); and the Seme offshore oil produc-tion project (US$120 million), estimated to yield about 11 to 20 millionbarrels. These projects together account for some 50 percent of the invest-ment foreseen in the Plan. Work on Cotonou Port is far advanced. The sugarand cement projects are joint ventures with the Nigerian Government, withNigerian marketing and financing guarantees. The production of sugar,cement and oil should commence around 1982.
14. Based upon an analysis of the major projects and Benin's financingpossibilities, Bank staff estimate that only 70 percent of the plannedUS$1.1 billion investment will materialize, and will be disbursed over five
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years (1978-82) rather than three. This would push the overall publicinvestment rate to 19 percent of GDP on average over the 1978-83 period,compared with the 10 percent over the 1972-77 period. Facts confirm theseestimates; the rate of implementation of the Plan's first two years 1978 and1979 has been below 40 percent of the objectives. Major difficultiesinclude inadequate project preparation and coordination, delays in obtainingforeign financial commitments, and insufficient control over project execu-tion. For 1980, the implementation ratio is projected at 50 percent.
Prospects
15. The medium-term outlook for economic growth in Benin is moderatelyoptimistic. Real GDP growth during 1979-85 is expected to average 5-6percent per annum. The downside risks to Benin's economy are the relianceon Nigerian demand and the negative impact of problems which may arise inimplementing the large projects. The benefits from these projects are, inturn, dependent upon price agreements (specifically with Nigeria in the caseof cement and sugar). Benin's agricultural growth prospects will, moreover,depend on effective pricing and marketing policies in the rural sector. Inthe long term, Benin's growth potential will be limited by a poor resourcebase to perhaps 4 percent per year, and even the achievement of this ratewill depend on the ability of Government to channel resources and orientprograms (in social and economic infrastructure, training, marketing, etc.)to the development of food and cash crops.
16. Benin's public finance and balance of payments situation mayfluctuate more over the next five years than has been the case in thepreceding half-decade. In the mid-1970's, conservative public policies ledto budget surpluses and a stable trend in foreign reserves. This partlyreflected, however, the lack of sizable new initiatives in public invest-ment. The situation is now changed with the implementation of the ThreeYear Plan which places heavy demands on the Treasury for counterpartfunding, and steps up the pace of capital and intermediate goods importsmatched by foreign financial inflows. The balance of payments will undergofluctuations between now and 1985 under the impact of the major projects.Since the large projects underway will heavily influence the trade balanceand public finances, their succesful implementation is essential forBenin's medium-term outlook.
17. Benin's total external debt (including undisbursed), which untilthe end of 1979 had remained relatively low (amounting to US$293 millionwith a debt service equivalent to 7 percent of the country's exports),is expected to rise substantially as investments increase and borrowingconditions harden. The debt service ratio is projected to reach 22-27percent of exports in the mid-1980's. This ratio is high, but up to80 percent of the debt service is accounted for by the large projects,two of which are guaranteed by Nigeria. Nevertheless, this points upBenin's vulnerability. Were any of the major projects to encounter seriousproblems (cost overruns, inefficient management, or unprofitable pricingagreements with Nigeria) then the debt burden could quickly become unmanage-able. The low level of Benin's traditional exports does not permit muchflexibility in this respect.
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18. In view of the country's low per capita income, the growing
need for external funding of priority projects in an expanding economy,
and Benin-s narrow export base, it will be necessary to increase the
volume of foreign financing on concessionary terms. Benin is expected to
be able to finance no more than 10-15 percent of its overall public invest-
ment programs thus foreign donors should continue to provide a large share
of total project costs, including the financing of local costs.
PART II - BANK GROUP OPERATIONS IN BENIN
19. To date the Bank Group has extended ten credits to Benin including
two supplementary credits totalling US$77.8 million. Three of the credits
were for agriculture (17 percent of total lending), four for highway con-
struction and maintenance (51 percent), and one each for port expansion,
education and small-scale industries development. Annex II contains a sum-
mary statement of Bank Group operations in Benin as well as notes on the
execution of ongoing projects.
20. IDA's first operation in Benin was the HINVI Agricultural Deve-
lopment Project (FY69) which provided for oil palm plantings and foodcrop
development. The project was satisfactorily completed in 1974. As stated
in the Project Performance Audit Report (M78-451 of May 19, 1978) poor
rainfall delayed palm tree development while foodcrop production. remained
below appraisal estimates mostly because of labor constraints. To over-
come this difficulty, an accelerated program of ox-drawn cultivation was
initiated. Animal traction expanded rapidly resulting in substantial
increases in maize yields. The project was successful in assisting SONADER,
the executing agency, to continue its good performance and supporting cooper-
ative developments. The second agricultural credit, the Zou-Borgou Cotton
Project (FY72) has also been completed (Project Performance Audit Report
M78-353, April 20, 1978). This operation aimed at expanding cotton and
foodcrop production in the Zou-Borgou provinces. Due to organizational
upheavals, the project failed to achieve its objective of increasing cotton
production. Foodcrops, on the other hand, have been expanding mostly due to
growing demand from neighboring Nigeria. While the OED Report does not
conclude that a larger maize component in the project would have made it
successful, experience suggests that agricultural packages should be more
diversified, by combining export cash crops and staple food crops with
the latter included not only to satisfy farmers subsistance neecls, but to
supply domestic markets and sometimes also those of neighboring countries
and provide an important measure of flexibility to the implementing agency
The third project in the agricultural sector was the Technical Assistance
Project (FY77) designed to strengthen the country-s agricultural institu-
tions and to prepare follow-up rural development projects to the Zou-Borgou
project. The first of these is the Borgou Province Rural Development Project
which is closely linked to the proposed project and is scheduled for Board
consideration in 1981. A project focusing on the Zou Province :Ls planned for
FY83.
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21. The Bank Group's involvement in the transport sector in Benin beganin 1969, when the Bank acted as Executing Agency for a UNDP "Land TransportStudy." This study led to the financing of a four-year Highway MaintenanceProject in FY69. The Project Performance Audit for this project (Report No.M77-758) of October 25, 1977 indicated that significant strengthening of theGovernment department then responsible for maintenance operations occurredunder the project. The Second Highway Project (FY73), co-financed by USAID,comprised the reconstruction of 320 km (Parakou-Malanville) and short sections(between Godomey and Bohicon) of Benin's north south trunk road, the continu-ation of the road maintenance program initiated under the first project, andtraining. The project was satisfactorily completed. The rate of return ofthe Parakou-Malanville road is estimated at 16 percent versus 13 percent atappraisal and 30 percent versus 19 percent at appraisal when includingbenefits to Niger from its transit traffic. The Third Highway Project(FY78) provided for further rehabilitation of a 107 km section of the Godomey-Bohicon road and the expansion of the maintenance program, including theelimination of the backlog in resurfacing bituminous laterite roads. Theimplementation is proceeding satisfactorily after initial delays. Somecost overruns have been incurred. A First Feeder Road Project was approved inFY77. Details on its execution are given in paragraphs 30 to 32 below. Theproposed project is a follow up to this project. A Port Project was ap-proved in 1978 and its major objective is to raise the cargo handling capacityof the port by providing additional berth (660 m), storage capacity, andtechnical assistance to improve the port operations. Project execution isprogressing satisfactorily. Final cost is expected, however, to be higherthan estimated at appraisal. The Government is seeking additional financingfrom the co-financiers. A Fourth Highway Project to be submitted to theExecutive Directors later in FY81 would aim at improving the efficiency ofroutine and periodic maintenance and continuing the elimination of the backlogmaintenance of laterite roads.
22. The First Education Project (FY74) emphasized the non-formalsector. Its aim was to train rural youth and upgrade the country's voca-tional training capacity. This project is proceeding satisfactorily. TheSecond Education Project (scheduled for FY82) would consist of training forprimary, secondary, and technical school teachers and the production ofdidactic materials.
23. In FY80, IDA granted a credit to the Banque Beninoise pour leDeveloppement (BBD) which is the national development bank providingmedium and long-term loans to both the public and private sectors. Theproject is aimed at providing BBD's the resources it needs to financesmall- and medium-scale enterprises up to 1982; and strengthening BBD'smanagement and capacity to promote small- and medium-size investments.
24. In the future, in addition to the rural development and highwayprojects mentioned in paragraphs 20 and 21, IDA plans to participate in theexploitation of an off-shore oil field at Seme and the urban development ofCotonou.
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PART III - ROADS IN BENIN
25. Benin's transport system is well developed. Cotonou, the capi-tal, is the focal point of a route which begins at the port and extends thelength of Benin to landlocked Niger and Upper Volta, and comprises 440 km ofrailway (Cotonou - Parakou) and 320 km of road (Parakou - Malanville).Benin's road network consists of 7,300 km of classified and unclassifiedroads of which 900 km are paved, 2,700 km are laterite-surfaced and 3,700km are rural earth roads. Rural roads are generally in poor shape. Halfare unimproved mere tracks which are impassable to four-wheel-drive vehiclesduring most of the rainy season.
26. The Directorate of Roads and Bridges (DRP) of the Ministry ofPublic Works, Construction and Housing (MTPCH) is responsible for roadconstruction and the maintenance of 3,800 km of interstate, national andsecondary roads, and some 1,200 km of feeder roads. While the responsi-bility for maintaining the remainder of the (mostly unclassified) networknominally lies with the IMinistry of Interior and local authorities, thiswill gradually be assumed by DRP.
27. The General Studies and New Works Division in the DRIP is respon-sible for preparation and supervision of new projects. Most projects financedby foreign aid agencies are prepared and supervised by consultants. Thecountry lacks local contracting organizations of sufficient capability, andmajor works are undertaken by foreign contractors. However, improvements tosecondary roads under the Third Highway Project, and of feeder roads underthe Zou-Borgou Cotton and First Feeder Roads Projects, have been carried outby force account by DRP.
28. Main roads maintenance has improved over the years, but is stillhampered by understaffing, shortage of equipment, poor equipment maintenanceand insufficient local funds. Feeder road maintenance is being reorganizedunder the DRP since underfunded local authority efforts have rarely been ableto assure all-weather utilization of feeder roads. The proposed projectwould, inter alia, provide DRP with the short-term capacity.to give financialsupport and supervision to labor-intensive maintenance work carried out byworkers to be drawn from the local communities, while a new organization ofroad maintenance activities is being established in conjunction with theproposed Fourth Highway Project.
29. Foreign sources (multilateral and bilateral) have contributedabout 85 percent of the funds for road construction over the last decade.Road maintenance funds are mainly local. Periodic and routine maintenance arefinanced by a Road Fund set up in 1970 for road maintenance and road-relatedstudies. The Road Fund draws its resources from a portion of taxes levied onsales of gasoline and diesel fuel and contributions from general revenues.However, funds become available only after long delays, not allowing thebudget to be fully spent and no provision is made for equipment renewal. TheGovernment has indicated that it would in the future make quarterly alloca-tions to the Road Fund to improve liquidity. Also the Ministry of PublicWorks' 1981 budget would include a provision for equipment renewal. Additionalrevenue sources for road maintenance funding are also being explored including
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increasing the fuel tax contribution to the Road Fund and providing for asmall levy for feeder road maintenance in the official pricing schedules ofcash crops.
30. Feeder road construction and maintenance is of high priorityfor Benin's Government and development of the network is primarily beingsupported by IDA, the European Development Fund (EDF) and the United NationsCapital Development Fund (UNCDF). The IDA-financed First Feeder RoadsProject (FY77) was conceived as the first phase of a feeder roads improve-ment and maintenance program. The project has succeeded in establishing aneffective Feeder Roads Division (Division des Routes de Desserte Rurale-DRDR)within the Ministry of Public Works which has set up an efficient system ofdata collection (on population, agricultural production and social infra-structure) for the evaluation and selection of roads to be improved. AnInter-Ministerial Technical Committee (ITC) grouping representatives fromthe Ministries in charge of public works, rural development, finance andplan, which was also established under the project and is entrusted with thefinal selection from the roads proposed by the DRDR, has effectively assumedits coordinating role.
31. The first project which was intended to test three different methodsof executing feeder road works, has helped demonstrate that construction bylabor-intensive methods is competitive with equipment-intensive methods.After one year of operation, the output by the labor brigades was on target(45 km per annum), the output of the heavy brigade (135 km per annum) reached90 percent of appraisal estimates, while the output of the intermediatebrigade (75 km per annum) reached about 70 percent. The shortfall of theintermediate brigade stemmed largely from the difficulties inherent in orga-nizing mechanized works in conjunction with labor-intensive ones; mechanizedbrigades initially experienced fuel and spare parts supply problems which werelater overcome; by contrast, labor-based methods proved relatively insensitiveto the supply and repair problems, and labor has been readily available at theprevailing wages paid by DRDR and its productivity is good. Constructioncosts per kilometer were slightly less for the labor-intensive than inter-mediate or fully mechanized units.
32. Based on the assumption of immediate start-up of works and anaverage annual output of about 300 km, the 4 brigades established under thefirst project were expected to improve a total of 845 km and maintain 425 kmover the 3-year project period. Contrary to - in retrospect - overoptimisticappraisal assumptions, it took 18 months before the project reached fulloperating speed. This delay was due to cumbersome administrative proceduresand the pilot nature of the project. During this period the exchange rate ofthe US dollar with respect to the CFAF deteriorated significantly and infla-tion was of the order of 18 percent. As a result of this and of cost in-creases over the appraisal estimates, only 300 km of roads were constructedwith available credit funds. Some of the factors affecting the cost of roadconstruction will obviously have an effect on the economic rate of return ofthe project, estimated at 18 percent at the time of appraisal, but they shouldnot reduce it by more than half, since most of the equipment procured underthe project retains more than half of its economic life and the initial cost
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of setting up the institutional framework for feeder roads construction andmaintenance should be spread over more than the first three years of theprogram. The proposed follow-up project provides for a second tranche of theroad improvement and maintenance program, based on the criteria for roadselection developed under the first project. It is estimated that about 700km of feeder roads would be improved and 1,200 km maintained during thethree-year implementation period of the proposed project.
33. As stated in para. 7, the situation of the agricultural sectorwhich constitutes the basis for the justification of the proposed projectis improving. Cotton production reached 24,000 tons in 1979/80, due torenewed Government support through extension and increases in producerprices and improved rainfall. Maize has increasingly been grown as cashcrop in response to growing domestic demand and border trade especiallywith Nigeria. To a lesser extent, this has also applied to sorghum. Pro-duction of rice which like wheat is a major food import, and of groundnutshave been increasing steadily. It is expected that with the implementation ofprojects such as the Borgou and Zou Provinces Rural Development Projects whichhave been submitted by the Government to IDA for possible financiing, thepositive trends which are now apparent will continue. The objective of thesetwo projects would be to strengthen the institutions in charge oif agriculture,rebuild an extension service capable of regaining the farmers' confidence andprovide the farmers with the essential inputs and infrastructure that theyseriously lack now. The proposed feeder roads project would help improverural road transport infrastructure in the Borgou province and ol-her priorityareas.
PART IV - THE PROJECT
34. The proposed project was prepared by the Feeder Roads Division ofthe Ministry of Public Works with the assistance of consultants, financedunder the First Feeder Roads Project (Credit 717-BEN) and the TechnicalAssistance Project (Credit 716-BEN). The project was appraised in April 1980by RMWA. A post-appraisal took place in May 1980. Negotiations were held inWashington in November 1980. The Beninese delegation was led by the Ministerof Public Works Construction and Housing. The Staff Appraisal Report No.3050-BEN of December 1, 1980 is being circulated to the Executive Directorsseparately. Annex III contains supplementary project data.
Project Description
35. The proposed project would consist of a three-year slice of theprogram for the improvement and subsequent maintenance by force account of thecountry's feeder road network including the strengthening of the DRDR.Physical targets would be the construction of about 700 km of feeder roads andmaintenance of about 1,200 km. The project would be executed by the Ministryof Public Works through its DRDR. Its implementation is scheduled to start inDecember 1980 and to be completed by November 1983.
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36. The project would provide for:
(a) highway maintenance equipment and spare parts, materials andsupplies;
(b) operation of the feeder road brigades; and
(c) technical assistance to DRDR in the implementation of theimprovement and maintenance programs, in training its staff,and for studies and future program preparation.
37. The road improvement program would provide for the constructionof 700 km of roads of which about 300 km in support of the envisaged BorgouProvince Rural Development Project. The improvement works would consist ofroadway shaping, provision of selected material and construction of drainagesystems. The project would provide for the establishment of two new labor-intensive brigades in addition to the two existing ones. The existing inter-mediate brigade would be dismantled and its equipment used to strengthen theexisting mechanized brigade and to establish a maintenance brigade.
38. The work program for the 1980/81 work season has been approved bythe Interministerial Technical Committee (ITC) and the Association. Theprogram for 1981/82 and each year thereafter once adopted by the ITC would besubmitted to the Association for approval no later than 3 months before thescheduled start of the work (draft Development Credit Agreement, Section 3.03(b)). The roads included in the program were selected on the basis of theirimportance for existing or planned agricultural activities. Criteria forfinal road selection and design and maintenance standards were confirmedduring negotiations and incorporated in a Supplemental Letter (draft Develop-ment Credit Agreement, Section 3.03 (a)). All roads to be proposed to theAssociation for improvement shall have an economic rate of return of notless than 10 percent.
39. The project would provide for initial maintenance of the roadsimproved under the project. Maintenance activities would be carried out bythe new maintenance brigade to be established under the proposed projectand the special feeder road maintenance teams which are being organized ineach highway maintenance subdivision. Equipment maintenance would be per-formed in existing maintenance shops and in mobile workshops. The maintenancework and feeder road improvement would be closely coordinated by DRP.
40. The technical assistance provided under the First Feeder RoadsProject - two engineers, one transport economist, three road techniciansand one accountant - would continue through the first year of the proposedproject (draft Development Credit Agreement, Section 3.02 (a)). Phasing outof this assistance is then expected to begin, Beninese counterpart staffhaving been on the job since early 1980. The main object of the technicalassistance would be the consolidation of the procedures introduced in the
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DRDR under the First Feeder Roads Project for administering, implementingand supervising the work. Local personnel would receive mostly on-the-jobtraining. Technical assistance would amount to 10 man-years. nTe averageman-month cost is estimated at US$10,200 including fees, outstation allowance,local and international transport, housing and subsistence and company over-head and profits. Services of an economist would be provided through a Dutchvolunteer.
41. By May 31, 1983, DRDR's planning and evaluation unit would carry outa pilot study designed to monitor the socio-economic impact of selected roadsimproved under the First and proposed Second Feeder Roads Projects and wouldinform the Association of the findings of the study (draft Development CreditAgreement Section 3.08). This would consist of regular traffic counts,origin and destination surveys, monitoring of population movements, croppingpatterns, marketing activities and utilization of social service facilities inthe road zones of influence.
Project Costs and Financing
42. Project costs (net of taxes) are estimated at US$8.7 million witha foreign exchange component of US$4.3 million (49 percent). The proposedcredit of US$7.0 million would finance 80 percent of total project cost(net of taxes) i.e. all of the foreign cost and US$2.7 million equivalent(about 60 percent) of local costs. The Government's contribution wouldamount to US$1.7 million equivalent. Base cost estimates are based on 1980prices. Average cost of improving roads is about US$11,200 per km. TheGovernment has given assurances that it would provide to DRDR on a monthlybasis beginning in December 1980, an amount of $175,000 equivalent to ensurecontinued operation of the existing feeder roads brigades until funds fromthe proposed credit become available. The Government has further providedassurances that it would promptly make available to DRDR as needed, Govern-ment's contribution to project financing. A Special Account, with an initialdeposit by IDA equivalent to US$300,000 would be established as under theFirst Feeder Roads Project. The Special Account would be replenished byIDA with amounts equal to the payments made out of the Special Account forexpenditures eligible for financing by the Association (draft DevelopmentCredit Agreement, Section 2.02).
43. The Government would establish and maintain the necessary accountsand records for the project in accordance with accepted accounting practices.Assurances have been obtained from the Government that project accountswould be audited by auditors acceptable to the Association; the projectaccounts and the audit would be submitted to the Association for review andcomments within six months of the end of each fiscal year; and the accountsand the audit report would be of such a scope and in such detail as theAssociation may reasonably request (draft Development Credit Agreement,Section 4.01(c)).
- 12 -
Procurement and Disbursement
44. All civil works would be carried out by force account. Equipmentand vehicles valued at US$ 1.1 million would be procured on the basis of in-ternational competitive bidding in accordance with the Association's guide-lines. In bid evaluation, due consideration would be given to standardizationof the new equipment with existing equipment. Goods manufactured locallywould be given a preference of up to 15 percent. Fuel, lubricants, construc-tion materials and handtools valued at US$ 1.6 million may be procured on thebasis of local procedures acceptable to the Association. Contracts for thepurchase of spare parts and office supplies estimated to cost not more thanthe equivalent of US$50,000 each may be procured on the basis of local proce-dures acceptable to the Association. The aggregate amount for such contractsshall not exceed the equivalent of US$0-5 million.
45. The IDA credit would be disbursed over a three year period tocover:
(a) 100 percent of the cost of equipment, vehicles, handtools,spares, fuel and lubricants;
(b) 60 percent of the local personnel salaries and the cost ofmaterials for road construction and maintenance;
(c) 70 percent of the office supply and equipment costs andhire charges;
(d) 90 percent of the technical assistance cost.
It is recommended that IDA provide for retroactive financing from December1980 for up to US$0.7 million to cover the eligible operating expenditures ofthe field brigades and the DRDR.
Economic Justification
46. The economic justification of the project is based on increasedagricultural production resulting from both improved accessibility and somecomplementary agricultural investments such as the envisaged Borgou ProvinceRural Development Project. The overall rate of return is estimated at 19percent. Rates of return of the roads retained vary between 10 and 34percent; all roads to be included in the project would have to yield aminimum 10 percent rate of return. Project benefits would accrue to farmerswho would have year-round access to markets for their surplus production, totransporters from savings on reduced vehicle operating costs and from bettervehicle utilization made possible by the road improvements. Greater relianceon labor-intensive construction methods would provide a larger number ofcommunities, from which labor is drawn, with the cash-earnings that wouldallow farm households to pay for the improved agricultural tools and inputsneeded for more intensive exploitation of their lands. The economy as awhole would benefit from reduced grain imports and extra foreign exchangeearnings from increased production of traditional export crops. Unquantifiedsocial benefits and benefits from institution-building would also represent asignificant addition to the quantified economic benefits.
- 13 -
Project Risks
47. The risks that the project would experience the implementationproblems of the First Feeder Roads Project are limited. These difficultiesproved to be essentially start-up problems. Since the institutions havebeen established and are performing effectively, the technical assistance isin place, and most of the equipment delivered, the roads are now being builton schedule and within unit cost estimates. The proposed project is expectedto further improve DRDR operations. Risks associated with the quality ofroad maintenance after project completion, the level of producer prices setby the Government for different agricultural products, the adequacy of inputsupplies and extension services are limited. The project includes aninitial maintenance component and technical assistance for developingappropriate maintenance procedures. After several years of stagnatingproducer prices, Benin has in the past year, increased producer prices forcotton, maize and rice, and implicitly accepted "free" local market pricesfor foodcrops. Adequate supply of inputs and appropriate extension supportwill be provided through planned rural development projects. the sensitivityanalysis shows that even with a drop in incremental production of 50 percent,the project would still yield a rate of return in excess of 10 percent.
PART V - LEGAL INSTRUMENTS AND AUTHORITY
48. The draft Development Credit Agreement between the People'sRepublic of Benin and the Association and the Recommendation of the Commit-tee provided for in Article V, Section l(d) of the Articles of Agreement ofthe Association are being distributed separately to the Executive Directors.
49. Special conditions of the project are listed in Section III ofAnnex IV.
50. I am satisfied that the proposed credit would comply with theArticles of Agreement of the Association.
PART VI - RECOMMENDATIONS
51. I recommend that the Executive Directors approve the proposedCredit.
POPULATION PER PHYSICIAN 47000.0 28920.0 26908.0 30910.4 14508.2POPULATION PER NURSING PERSON .. 2910.0 3007.0 5793.2 3279.5POPULATION PER HOSPITAL BED
INCOME DISTRIBUTIONPERCENT OF PRIVATE INCOMERECEIVED BY
HIGHEST 5 PERCENT OF HOUSEHOLDS 31.4/cHIGHEST 20 PERCENT OF HOUSEHOLDS 51.7/cLOWEST 20 PERCENT OF HOUSEHOLDS 5. ...
LOWEST 40 PERCENT OF HOUSEHOLDS 15.B/.
POVERTY TARGET GROUPSESTIMATED ABSOLUTE POVERTY INCOMELEVEL (US$ PER CAPITA)
URBAN .. .. .. 138.2
RURAL .. .. 84.0 86.1
ESTIMATED RELATIVE POVERTY INCOMELEVEL (US$ PER CAPITA)
URBAN .. .. .. 107.0
RURAL .. .. 82.0 65.0
ESTIMATED POPULATION BELOW ABSOLUTEPOVERTY INCOME LEVEL (PERCENT)
URBAN ..
RURAL .. .. 55.0 66.9
Not availableNot applicable.
NOTES
/a The group averages for each indicator are population-weighted arithmetic means. Coverage of countries
among the indicators depends on availability of data and is not uniform.
/b Unless otherwise noted, data for 1960 refer to any year between 1959 and 1961; for 1970 between 1969
and 1971; and for Most Recent Estimate, betveen 1974 and 1978.
/c Population.
April, 1980
- 16 - ANNEX IPage 3
DEFINITIONS OF SOCIAL ISDICATORS
No-eu Although the data are drest Iron sources .enerally judged the mos authorittiae and reliable, it uvould also be noted chat they nap tno be inter-vatiocalip comparable hecouse of the lack of scooardloded definitions ood taocepts used by different counts les in collootnlg the data. The dota are, tone-theless, useful to describe erdero af naguitudo, indicate t_endo, and charatterlee ternain _ojur differesces bandee countrles.
the otefreoc4 groups am (I) thc ssn oaatru group ut the ubjec counry sod (2) a country group with somewhat highle average income thls the country groupof tbe nuljeutcountry (eI cept for "Capital Surplus 011 Etytriers" roup hore `Middle IllcN.e North Africa and Middle Ea-s" is chosen because of strongersocbo-cultaral affuctiem). Is she reference group data .r .averafes ace population neLghted erithmtir mean fur each indicator and showon eeshen atleant tall cf the countries inagroup baa data for ifah indi,ator. Since the corage of coinrtn- aong the lodttanors depe-du on the aeailatility ofdofa and is noe nifotpA , cat nion must he exercised is relating averages of -oe indicator to ansther Thse averages are anly useful is tosparlig the valueof eve indicator at a time among the country and reference group,
LAND AREA (thousnod sqAkm) ruOst ou rer chy§ar-rouan au Vused ty suce on pracuicing pip-Total - Total sarface -eeam _priaing laud area and inlod waters. siebano qualiirid rum a -edlcal school at unloersnt level.duricultcual - intimate of agricultural ares used nesnynrarity or permaaennly Poeulatipn per Nursisg Person - Fopalotiau divided hy sumter ot prantltlagfor crops, pootoren, vtaries and kctcher gardens or to lie fellow; 1977 data, mle and female graduaat nurses, practical ourses, end assisant nurues.Puoslatlos per faspinal god - total, urban, a- orerl - Population (total,CNP PEt CAPITA (CI)) - CSP pear capita estimxates an current marten prices, cal- urhen. nud rural) divided by their tespecnio number of hospital tedsculasted by same coscarsion method as World lank Atlas (19(6-If basis); 1960, anailable ha puhbltc and prieane general ad specialized hospisal and re-1970, sod 1797 data. bahtbilitsss testers. gespisals are estahlihtmenst peeas.eoaly statffd
ISthT C9OIfPTIO Pi Ce'ta -Ounami onsmpton f cumeolalseey (eal by at least one phyniecai n smibliatmoots providing prinripally resnodialENERY CNSIIPTIN PR CAITA- AnualCoqUPpton f cocerialenery (oal care are sot latladed. fatal haspSisets, hawever, include hemsth sad mediraland lignito, petroleum, natural gas and bydro-, sueleas esd geothermal alec- tenters set pereaneuml staffed hy a physician (hut hy a ruedleal assistams,tricity) in kilogrum af teal eqoivaleunt per capita; 1960, 1970, and 1979 ourse, midwife, ae.) which offer ip-patiens ocroumedatiom and prov-ide adats. liedted range of medical futilities. Par sst5atstial pnrpomem urhan tospi-POPULAT1ION AfhD VITAL STATISTICS opti oa rItlhsBtl ad dcaif opti,n uaCotaf Peoplation, rid-near (millions) - Au of July 1; 1960, 19(0, and 1919 Adeisnions per fosrital Satd - loana nasher at admissions to or dischargesdare. frue hospitals divided by she muster nf bedm.Urban Populatioe (perceonat sfotal) - b'meiaopf urban no total population;
dinfoerest definitions of urhanosreas maup attecsteeoparability at dasa NOUSINCamong coontre se; 1960, 1970, asd 1979 dana. Average Siee otf fausehoid (persons per hoasetold) - tonal. urhao, and trsers-Forulation Profectaoss ~~~~~~~~~~A tousehold coosisms of a grnsp at indiniduals who stare lining quartersPDsulation in rear l00l - Corress pupulatiou proetetions are tamed 0n i9f0 sad thoei sal eals. A tearder an lodger may or maY not he eatluded intotal populasion bp age and men and their mortality and fertiliry rates. ehe trusebold tar stamissical purpams.sProjecnlee parasesers tat moprsality ratses comprise of ehree levels aesun- Anesafle sumter at persons fer rous- natal, urban. sad rural - Average pOtf life enpeossuop at htrnh increasing wish tcountry's per ca pita mous e bar of perioneu per roar Ca all sehas. and rural otcupied crnveestionalmoo
1l, mod femle life eupocrancy stabillaing at 77 5 years. The pars- dwellIngs. respettiveily lnellfngm exclude mor-permaansmtstructsremandmeters fur fernil isp rate also have three lerels amsumisg deoline is aunoccuoled parts.fertilipy according to incest level nsA peast tally plansieg perfurmante. Accosa to Electreaity (percent of dwellioss) - tonal, urhap, med rural -tech country is shea asuigned nore of these nine camhlsatiaes of murrolite Couvausioasa Awvellige evith electririty fun lining quasrters mas percentageumd fortuitiy Creeds for projectuion purposes. of satal. arhas, and raral dwellings respeetively.Stationary porulation -aIna seaionary population there is to growth isince
the birth sass is equal so shin death rate, sod also the age structure re- eEDCATlONtalus constuant This in achiened only after fertility rarss denline to Ad1nseed tarilmesset ganiasshe replacesment level of nnit ene reproduction race, ehes each genera ties Primary srhaol - total. male asd female -Gross total, mete snd femalecI tamspe replaces itself exactsly. The stationary population mssa sam erarllmeus of alli ages at ret rrisa ry level as pertestages of respectiveesrimatod cn the basin at she projected characteristics of the population primary school-age populatiosa ipnormlly includes childere uged h-liOn the pear 2000, and she rate at decline of fertilirynrateto replace- years hat adjussed tar differenr legnghs of primury odanatios; formeat level. reamntries sith unioersal edanatiam serailmensept yeaseed 1Sf pernentTear artlataobrn porulation is resthed - Toe year when stationary populsnioo mince same parils are talony or ahove the otfitial ethpon age.sloe ban been reatbed. ierondarr attest - metal. male and female - Cam pared as shove; aecondaryPetulatioe Denuity edaterOrn requires at least lone nears aof approved primery inarruttiow;Per mu. ken - Mid-year ppoplarias per aqvure kilq=eter (1100 hectares) of provides general, rotatiasal. or teacher teaining instructions f or popibsrotal area. usually of 12 to 17 pears of age; cerrespesdesreocourses ace generallyPer usq An agritolnural land -fosmpored mas aboea tar ogrinolsural land eseluded.Only. Vocational earollseet (perceot at smeondary) - Vocational iustitutionsPorularior doe structure Irerceotl - Children (0-lA years)I, markIng-age (15- inclode terhuiral, industrial, rr other programa whith aperate tederse-hA years)I, and reeired (tS ysars mod oner) as percentages of mid-year papa- donrip or as departeneas at setoedary instituniawsalation; 1960, 1900, and 19(9 datea Popul-tesoher ratio - erimary. sod aeco,dary - Total students ettalied inPoPulaPien Crovth Rare (pereentj - total - Annual growth rates at nasal mid- primary end metondary levels divided by ereahrm of teachers is theyear populations far 1950-t0, 1960-70, sod 19(0-PS. correSponding levels.Pppulstion Grovth Rate (rercens) - urbar- Annual aroush rates at artan rpop- MAdlt literacy rune lrerrrsn( - Literate adults (able to read and write)lations foar 1950-tI, 1960-70, cand 1970-PS. asa prteerage of toana dadlt population aged 15 years med over.Crude girth Ratie leer theasand) - Annual live hirtha per thousand oa mid-yearpopulation; 1960, 19(0, and 197B data. CONSSbPTI1N
Crudr leash lane leer thousand) - Aannpl deauths per thousand of aid-pear Pasmenger Cars leer thousand rapulation) - Passonger tars rpamrrise motorpopulation; 1961, 1970, and 1979 data, tars searing less than eight persons;in=cludes ampbulances, hoarsesvaedrGsY RSeroduction lane - Average voumbr at daIghtersa ilsn sill hear is military vehiclesher normal rarroduotver period ir she experientes present age-specific for- iadAa Reeciners leer thousand enealacuor) - ALl types af receivers tar radardulty rancs; usually five-year averages aedisa In 196D, 1970, and 19(7. broadcasts no general public paer rhoasaud qf population; encludes asli-famIly P lanning- Accertrrs. Aesaaal Ishausanda) - Aanpul numnber of acceptoru teased receIvers in couantries med in years whoa regiastration at radio semNof hlrtt-tcntrol devices umder aaspites of national ralxly planging program, was in effect; data tar recent peers may pot he campratale mstsc saintFuly Planning-leers (perceut of married easef - Perceutage of married ciuntrios abclished licensiog.Looen of child-hearog age (15-A4 years) aho use birth-tontrl devices 50 TV Receivers (rerthousand hpulatinnI - TVI receivers for trued cams toall earnesd voseDn so Renage gcpup. general public per thousand population; euludes unalceoned IN7 receivers
inseuumteieas sdin yseaab vesrogistrutloeof TV seatawain f ,coot AR2 NUTRITIdN seomraper Circulation leer thousand popsulsina) - Shows the arerage nireuls-Indro of youd Predtucion rer Carida (1969-7110j - Inden of per tapira soal than at 'daily general inrerost newspaper'. deftned amperiodical pub-production of all food cots=pdities. Production excludes seed and teed and licaslon devoted primagrily to recording general mess. Intoi connideredIn on palendar pear basis. Coumodin lea tover primary goods (e.g. eugarcase no ho "daily" if in appears at least four times asc. Rbusreau or nugurj etuch are edible and connain nutrients (e.g. toffee eand Cinema Ansual itrowdauce per Gonnae rer Year-fBased or the number ofIr t are etladed). Aggregate production or each toantry ia based 05 niehs mold during the year, includIng admisfi-na to drine-in citesusoarlava1
average producer price veights; INtl-IT, 1970, aud 1978 data 1ad e.tilo unite.Per cuaanc rrlnivof cualries Irarcoot rf rsouirezenta)-asefutrd froe
reergy equivalent at set fond supplies aoullahlo in country rer capita LABOR PORCRpar day. Available supplies raspriso domestIc productnian, importu lens Toral Labor Porte (thoasands) .- loanaically sctrive persons, including5oports, and changes is stack. Net suppllienextlude anImal feed, seeds, armed fortes aed unemployed hut eec lading boasowives, students, Ott.
Iuantities used in toad processing, and losses ia distributlon. equite- Dfiot is in varioau tohutries are nor todparable; 1960, 1971 andsenctu era eutinoted by FAG tuned on physiological reeds for normal acti- 197 dor a.city und health considering ennlropapeftal tesparasre, body weights, age F I (r et) - Female labor gorce as percertase of total Iahor tortsand neu distribution at popularion, cod allovndg 1W percent fOr wayne an Agritulture rarcest) - Labor force is farming, forestry. hunting andbousebold level; 1961-65, 1970, and 1977 data. fishing an perrentag of total laor forte; 1960, 1971 mod 1979 dataPrr ccc Ira suoorl of protein (grass pert day) - fruteln contest of per taplia Iedustry (rercent) - Labor force io miolg. coanstruction, meoufacraringnet supply of foud per day. Net supply of foud is defined onshore. Re- and aleotrcity saner and ges .o percentage of tonal labor farce; 1960qciraerou for alt countrres eutatltuted hr USDA prooide tar e 0n umo 1970 end 1970 data.ullevanor of 00 dress of total protein par day apd 20 grams of anfvol and Pariticiation Rate (percent) - loana, sale, and tamale - Participation orPUino Frotefo, of vhich 10 gros should be urInal prateis. Theur stood- actioitp ratea are Computed as total, male, and female labor tarts as5tsn urn burer thap those of 75 Wramas of rotal prDtsin and 13 grams of porreonuagea of nasal, male and femmla papaaseioo of all a gee roepecrtvely;animal proteinu an acerage for the vorld, peopased by FAO in the Third 1960, 1970, and 1975i data. Theta are ILl's parnriipastio rates reflectingWcrld food Sorrly 1961-AT, 1970 and 1977 data, age-sea structure of rho populatin, and long time tresd A tow ssti-Per tapita protrein suroly from arlmal aod coinse - Protein supply at food do- ma tea are from national uources.rtivd froP anlmalo and pulses in grams per day; 1901-AS, 1970 and 192) duta. troo ic Dependesoy Ratio - ERtia of population nder IS mud 95 uand q trChliA (agry I-A) Mortality Rate (per dtousand) - causa deaths per tbausand 10 no she total labor froce _ago grouy 1-4 years, go children in thin age group; far mast dmvelopingrcoun-cries data derried from li fe tablesI 196t, 19(0 and 1977 data. ThCGdEt hoSdrISfTlOn
Perceetage of Prioate lonine (bath in tsh and hind) - Received by richestNLT' 5l - A e n percent, richest 0 percent,porest 2 percnt, snd poorest A percentat birchi loll, 1)70 and 1)70 dana of5.- hsta .pd_.-cant Moftalty Rate (per lbouautd( - Annual deatbs of infcuts under one year PVR TARCRT CtOUPSof aa per thoussnd lIne births. dstimated Ahuolute Poverty Income Level (IES) rer aita) - urhum and rural -A dccssto Safe Outer (yercenn of population) - total, urtuu, end rural - Absolare poverty inome level is that income level bel_w vhich a mInimalNushec uf people (tonal, urban, and rural) oith reasonableaccmuut o sefe nosrinionally adequate diet pins easentral nan-fond retnirements is sotvaterrsupply (includes rrsaed surface careen op untreated bun unconnaminated _f_rdabl_wutervuact as that from protected barehelas, springs, and savotrer nells) cs funimaned Relanine Poverlo Iscost Levml (Ccl perr toapita) - orhum and eurol -y ..cenugen of their respective pop-latrons 1in an orban urea a public guralrelative poverty i nt-e level is one-third at average per ca.pitafountain or slandpouc lacuted non more that 110 meners fromabchuse may be persona_ Income of the country. Urhan lenel is derived from the puralounsldeced an bolog vithin reasonable accesu of that loouse. In rural areas loevel i'th adjustment far higher ross of living in orb as mreas.preautable aocruu could imply shut tic bousevifs or smsbors of the household Catimated Poculanicuonuslo Abnoluue Faorert Iscone Lerel (percent) - urbanrnot hbur to send a disrrorortbovath purt of te lay in fehtona ite sod tutul - Pmeteor rt population -urban and roral) vho arretaolute poor."asIlA o .outer 00 do _
Ac cess to Ercreta Diucosal caercest of oocluolaon - total urbar andrural - Number of prople (total, urban, and rural) nsered by roorenoduyoooslo rsoprcanuagra of theicrurepectnivs populacions . tcrrta d iu- teanomlc and Irrial late Dinisionpossuayuaincludetbe callectionoanddisposal,avith oralsbhout treaiweeoh taomosieAaelysis andProjectionsoDepartmestofbhumaanocxrrt aodvarsanvater byuvaer-boroasystems ortCheumeo of April, 19
11cit privces end similar Inn tllat ons.
- 17 -ANNEX IPage 4
ECONOMIC INDICATORS
GROSS NATIONAL PRODUCT IN 1979 ANNUAL RATE OF GROWTH (% CURRENT PRICES)
US$ Million 7. Of GDP 1975-79
GNP at Market Prices 972.7 102.7 16.0GDP at Market Prices 946.7 100.0 15.7Gross Domestic Investment 198.1 20.9 21.0
mentTOTAL 77.80 30.42of which has been repaid 0.08TOTAL now outstanding 77.72TOTAL now held by IDA 77.72TOTAL undisbursed 30.42
1/ Prior to Exchange Adjustment. -
2/ Including a Supplementary Credit of US$9 million.
3/ Excluding participation of the Government of Norway of US$8.3million in the IDA credit.
4/ Not effective yet.
- 20 -
ANNEX II
Page 2
B. Projects in Execution 1/
Credit No. 415 Second Highway Project, US$11.8 million creditof July 3, 1973, Closing Date; October 31, 1981. Due to inflation andcurrency realignments, project cost estimates increased to US$23.3 million or77 percent above the original cost estimates. The Association provided asupplementary credit of US$9.0 million on March 10, 1976. Physical executionof the project has been completed. The closing date was postponed to October31, 1981 to allow for disbursement of about $600,000 to cover costs of tech-nical assistance under the Feeder Road Project (Credit 717-BEN). AboutUS$3.2 million is expected to remain undisbursed under the Credit.
Credit No. 583: Rural Education and Training Project; US$4.0million credit of September 5, 1975; Closing Date: June 30, 1981. Thiscredit provides for (i) construction and supply of training materials for aSkills Upgrading Center in Cotonou; (ii) construction, equipment and technicalassistance to improve the ongoing rural youth training program; and (iii)preparation of a second education project. The construction of the NationalSupport Center (CNAC), and of the Regional Support Centers for the ruraltraining component of the project and of the Skills Upgrading Center (CPPE)have been completed. Personnel have been appointed to the CNAC. Equipmenthas been selected and issued to the youth clubs. Training for extension staffand group leaders has begun. Implementation of the rural water supply com-ponent jointly financed with UNICEF, commenced in July 1980 is expected totake two years to complete.
Credit No. 716; Technical Assistance Project; US$1.7 millioncredit of May 30, 1977; Closing Date: December 31, 1980. This project isdesigned to prepare the way for a rural development project. The projectwhich was to be carried out over a two-year period is nearing completion. Itprovided for technical assistance to SONAGRI, the project-executing agency infinancial management and project preparation and evaluation, procurement oftrucks and staff vehicles, consultant services for the preparation of invest-ment proposals and for cotton and foodcrops adaptive research. Preparation ofthe proposed Borgou project has been completed and the one for the Zou projectis nearing completion. The technical assistance program has been extended toDecember 1980.
Credit No. 717: Feeder Roads Project; US$5.5 million creditof May 30, 1977; Closing Date; September 30, 1981. This project consists ofa three-year program for the improvement of about 845 km of feeder roads andsubsequent maintenance of about 1,270 km, the purchase of highway maintenanceequipment and spare parts, and technical assistance to the Ministry of Equip-ment. Project start-up was delayed for about 18 months because of delays inequipment delivery. Works under this program would be continued in a secondphase under the proposed second feeder roads project.
1/ These notes are designed to inform the Executive Directors regardingthe progress of projects in execution, and in particular to reportany problems which are being encountered, and the action being takento remedy them. They should be read in this sense and with the under-standing that they do not purport to present a balanced evaluation ofstrengthens and weaknesses in project execution.
-21 -
ANNEX IIPage 3
Credit No. 746: Third Highway Project US$10 million credit
of November 18, 1977; Closing Date: December 31, 1980. This project
is designed to facilitate access to the Port of Cotonou by providing
for the rehabilitation of a 107 km section of the country s main
north-south highway; it also aims at expanding the highway maintenance
program begun under the two previous highway projects; including the
elimination of the backlog of bituminous and laterite roads resurfacing.
Project execution is proceeding satisfactorily although delays in starting
the bitumen roads resealing program have resulted in further deterioration
of about 28 km of roads which now require full reconstruction. This
coupled with an erosion of the dollar of about 17 percent since appraisal
has caused project costs to increase by an additional $5.5 million.
Credit No. 926: Cotonou Port Project; US$11.0 million credit
of October 6, 1978, Closing Date: March 31, 1982. This projecl: provides
for the extension of the existing general cargo port facilities involving
dredging of a new basin, construction of 610 m berths with transit sheds,
hardstandings, roadway, and railway services; the construction of a new
cut-off breakwater and entrance channel dredging; technical assistance
for all port operations including railway and a study of coasta:L erosion
problems. Eight co-financiers including IDA had originally agreed to par-
ticipate in the project and to provide about US$44.0 million of external
financing. A US$3.0 million EEC Special Action Credit was approved on
November 9, 1979 to close the financing gap created by the withdrawal of one
of the co-financiers. Civil works are proceeding satisfactorily. Project
costs have increased by about $7.5 million, primarily because of a design
change necessitated by an apparent shortfall in the volumes and sizes of rocks
expected to be obtained from an old breakwater to be demolished for the
construction of a new breakwater.
Credit No. 997-BEN: Industrial Development Project; US$10
million credit of April 16, 1980; Closing Date: June 30, 1985. This project
provides needed term resources to the Banque Beninoise pour le Developpement
(BBD) for financing small- and medium-scale investments in the industrial
sector and technical assistance to help build up BBD-s capacity to identify,
promote and assist industrial projects. This credit is not yet effective.
- 22 -
ANNEX IIIPage 1
SECOND FEEDER ROADS PROJECTSUPPLEMENTARY PROJECT DATA SHEET
Section I: Timetable of key events
(a) Identification Mission September 1978(b) Appraisal Mission April/May 1980(c) Negotiations November 1980(d) Planned date of effectiveness April 1981
Section II: Special Project Implementation Actions by IDA
None
Section III: Special Conditions
The Government shall:
(a) reach agreement with IDA on the feeder roads to be improvedand maintained under the Project and on the design and main-tenance standards applicable thereto (para. 38 of this report);
(b) furnish to the Association, for its approval, the proposedannual work programs for the improvement and maintenance ofrural feeder roads, promptly after such programs have beenapproved by ITC, and not later than 3 months before thescheduled start of works (para. 38);
(c) by May 31, 1983, carry out, under terms of reference satis-factory to the Association, a pilot study designed to monitorthe socio-economic impact of selected improved feeder roads ina given CARDER and inform the Association of the findings ofthe study (para. 41);
(d) continue to employ experts and consultants in carrying outand monitoring the Project, and to assign qualifiedBeninese to work closely with the experts and consultants(para. 40);
(e) cause DRDR to open a Special Account for the purposes of theProject in a commercial Bank of its territory in which theAssociation shall deposit promptly after Credit Effectivenessan initial amount equivalent to US$300,000 (para. 42).
(f) provide on a monthly basis, beginning in December 1980 anamount equivalent to $175,000 to ensure continued operationof existing feeder roads brigades until funds from theproposed credit become available (para. 42).
- 23 -
ANNEX IIIPage 2
(g) cause project accounts to be audited by auditors acceptableto the Association;the project accounts and the audit wouldbe submitted to the Association for review and commentswithin 6 months of the end of each fiscal year (para. 43).
IDA shall:
provide for retroactive financing from December 1.980 for up
to US$0.7 million to cover the eligible operating expendituresof the field brigades and DRDR (para. 45).
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