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FILE COPY RESTRICTED Report No. TO- 585a This report was prepared for use within the Bank and its affiliated organizations. They do not accept responsibility for its accuracyor completeness. The report may not be published nor may it be quoted as representing their views. INTERNATIONAL BANK FOR RECONSTRUCMION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION BENI LIVESTOCK DEVELOPMENT PROJECT BOLIVIA May 2, 1967 Projects Department Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized
Transcript
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FILE COPY RESTRICTEDReport No. TO- 585a

This report was prepared for use within the Bank and its affiliated organizations.They do not accept responsibility for its accuracy or completeness. The report maynot be published nor may it be quoted as representing their views.

INTERNATIONAL BANK FOR RECONSTRUCMION AND DEVELOPMENT

INTERNATIONAL DEVELOPMENT ASSOCIATION

BENI LIVESTOCK DEVELOPMENT PROJECT

BOLIVIA

May 2, 1967

Projects Department

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CURRENCY EQUIVALENTS

US$ 1. 00 =Pesos $11.88Peso $1. 00 =US $0.08Pesos $1, 000, 000 =US $84, 175

WEIGHTS AND MEASURES

Metric System

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BOLIVIA

BENI LIVESTOCK DEVELOPMENT PROJECT

TABLE OF CONTENTS

Page No.

SUMMARY ------

I. INTRODUCTION ---------------------------------- 1-------

II. BACKGROUND ---------------------------------------------- 1

A. General --------------------------------------------- 1B. The Beef Cattle Sector ------------------------------ 1C. Animal Health --------------------------------------- 2D. Agricultural Services ------------------------------- 2E. Government Policies on Livestock Development -------- 3

III. THE PROJECO --------------------------------------------- 3

A. The Project Area ------------------------------------ 3B. Description of the Project -------------------------- 4C. Cost Estimates -------------------------------------- 4D. Proposed Financing ---------------------------------- 5E. Disbursements --------------------------------------- 7F. Operating Results ----------------------------------- 7

IV. ORGANIZATION AND MANAGEMENT ----------------------------- 7

A. Project Administration and Technical Services ------- 7B. Lending Operations ---------------------------------- 8C. Procurement ----------------------------------------- 9D. Marketing ------------------------------------------- 9

V. BENEFITS AND JUSTIFICATION ------------------------------ 10

VI. CONCLUSIONS AND RECOMMENDATIONS ------------------------- 12

This appraisal report is based on the findings of a mission which visitedBolivia in August/September 1966. The mission was composed of Messrs.J. Fransen, J. Andreu, A. Dockx and M. Walden (IDA), and W. Allan (FAO).

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ANNEXES

1. Investment Costs for the Development of 200-Cow Beef Cattle Ranches2. Project Administration Budget3. Banco Agricola de Bolivia4. Project Financial Statements

Table 1: Central Bank Fund - Projected Receipts and DisbursementsTable 2: BAB - Projected Receipts and Disbursements

5. Organizational Chart of the BAB Livestock Project Division6. Development of 200-Cow Beef Cattle Ranches

Table 1: Herd Development ProjectionsTable 2: Sales ProjectionsTable 3: Operating Expenses ProjectionsTable 4: Financial Projections - Plan ITable 5: Financial Projections - Plan II

7. Benefits and JustificationTable 1: Incremental Costs and Benefits - Plan ITable 2: Incremental Costs and Benefits - Plan II

MAPS

1. General Project Location2. Ecology of the Lowlands (Llanos) of Bolivia

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

SUMMARY

i. The Government of Bolivia has requested an IDA credit to helpfinance the first stage of a Livestock Development Program for the improve-ment of the beef cattle industry in the lowlands. Because of technical,economic and administrative limitations, a limited approach has been adoptedfor this first stage, involving only the Department of Beni.

ii. The Project is directed mainly at investments basic to proper herdand pasture management such as fencing, stock handling and watering facili-ties, essential ranch constructions and stock management equipment. It wouldalso include breeding cattle purchases. Technical services would be pro-vided to encourage the improvement of pastures and breeding stock. Theseimprovements would permit an increase in herd productivity and total herdnumbers, and lead to greater output. Short-term financing would also beprovided to increase the effectiveness of development loans. It is expectedthat about 150 ranchers would participate in the Project. Each rancherwould initially have a herd of about 600 head of cattle and would developabout 2,400 ha of land under the Project. Loans to ranchers would berepayable in twelve years, including four years of grace with interest ata maximum of 12 per cent. Investments on each ranch would be spread overthree years.

iii. The Project is estimated to cost a total of about US$ 4.0 millionequivalent, of which US$ 2.7 million would be for ranch development, US$ 0.3million for technical services, and US$ 1.0 million for complementary short-term financing. The foreign exchange component would be approximately US$ 0.9million. The proposed IDA credit would be US$ 2.0 million, covering 50 percent of the total Project cost. Thirty-six per cent would be provided bythe Banco Agricola de Bolivia (BAB), including all short-term financing, and14 per cent by the participating ranchers.

iv. A special Livestock Project Division (LPD) would be established inBAB to administer the Project. The LPD would be headed by an expatriateProject Director who would be responsible for execution of the Project. Hewould be assisted by a small staff of Bolivian technicians. The LPD wouldbe responsible for assisting ranchers in preparing ranch development plans,recommending these to the LPD loan committee, supervising execution of plansfor which loans are made, and for providing technical services to ranchers.

v. The Project is sound and economically justified. The proposedadministrative arrangements are satisfactory. Expected benefits to bothparticipating ranchers and to the national economy are adequate, and theProject would serve as the basis for future expansion of Bolivia's Live-stock Industry. The Project is suitable for an IDA credit of US$ 2.0million. The borrower would be the Government of Bolivia, and the creditwould be channelled through the Central Bank to BAB.

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

I. INTRODUCTION

1. The Government of Bolivia has requested an IDA credit to helpfinance investments for the improvement of the beef cattle industry in thelowlands. The Project was prepared by an FAO/IBRD mission which visitedBolivia in July-August 1965, and the Project report was officially submittedby the Government to IDA in April 1966. This appraisal report is based onthe findings of a mission which visited Bolivia in August-September, 1966.The mission was composed of Messrs. J. Fransen, J. Andreu, A. Dockx andM. Walden (IDA), and W. Allan (FAO).

II. BACKGROUND

A. General

2. Bolivia has an area of 1.1 million sq km and is completely land-locked. It may be divided into three geographical zones: the altiplano(highlands), the yungas (intermediate valleys) and the llanos (subtropicaland tropical eastern lowlands).

3. Agriculture employs more than two-thirds of the total labor forceof the estimated 3.7 million population, the greater part of which lives onsubsistence holdings in the altiplano. Since 1952, when the government re-distributed land ownership in the altiplaiio, agricultural production hasbarely kept pace with population growth (1.7 per cent) and has declined fromabout one-third to one-fourth of GDP in the same period. More recently,however, the production of sugar, rice and cotton has increased appreciablyin the lowlands, and the first two have reached levels of self sufficiency.The lowlands, representing 65 per cent of the total area of the country andcontaining only 15 per cent of the population, offer very good opportunitiesfor beef cattle development.

B. The Beef Cattle Sector

4. The cattle population of the lowlands is about 1.2 million head,or two-thirds of the national total, and is largely concentrated in theDepartment of Beni. Official sources estimate an extraction rate 1/ of10 per cent for the lowlands. Annual production from the Beni Departmentalone averaged 6,500 MT of dressed beef from 1960 through 1965. This wasroughly one-half of total national production. The relatively low averagecarcass weight has remained fairly constant at around 180 kg per head inthe same period.

1/ Total number of cattle slaughtered annually expressed as a percentageof total cattle population.

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5. Domestic per capita consumption has also remained stable at aboutsix kg per year (the lowest in South America), although wide regionalvariations are apparent, e.g. La Paz and the tin mines consume three timesmore beef than the national average. Beef imports and exports have fluctu-ated markedly in the last five years, but their total value has remainedvery small.

C. Animal Health

6. Animal health problems in the Beni reflect inadequate management,the absence of a field diagnostic service, and limited application of diseasecontrol measures. The most important diseases are Foot-and-Mouth Disease(FMD - Aftosa) and Paralytic Rabies, which could be controlled by routinevaccination programs. During negotiations assurances have been obtainedthat all cattle belonging to ranchers participating in the Project would beroutinely vaccinated against FMD and Rabies. Other factors, such as lowfertility rate, calf mortality caused by diseases of the newborn, and in-ternal parasites could be brought to acceptable levels through appropriateherd management.

D. Agricultural Services

7. The agricultural services of Bolivia were built up as semi-inde-pendent organizations in the period following the agrarian revolution of1952. They were incorporated in a reorganized Ministry of Agriculture in1965.

8. The extension service's agents have little training in animalhusbandry. Field veterinary services are mainly concerned with Rabies con-trol in the lowlands, and with an FMD campaign in the Department of Cocha-bamba, which is to be expanded to include the lowlands. Assurance for thishas been obtained during negotiations. The Ministry of Agriculture plansto establish a field diagnostic service and a major vaccine production centerin the lowlands, coupled with expanded field veterinary activities.

9. The School of Agriculture at Cochabamba is poorly equipped andstaffed, as is the Veterinary School at Santa Cruz, but realistic effortsat reform are being made in the latter, where the present aim is to produce20 graduates a year. An intermediate level of training is given at the sixpractical agricultural schools, which graduate about 100 students a year,most of whom go into the extension service.

10. There are two agricultural research centers concerned with cattleproduction. The Trinidad center in Beni has done some breeding work andhas started to keep records recently. The Saavedra station of Santa Cruzis designing and testing systems of husbandry suited to the environment.

11. Medium and long-term agricultural credit, for which the demand isgreat, is available only from public sources, the most important of whichis the Banco Agricola de Bolivia (BAB) an autonomous organization under thegeneral direction of the Ministry of Agriculture. Besides lending from its

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own resources, BAB has channelled funds from US AID, which is also assistingwith reorganization and management, and the Interamerican Development Bank.Interest charged is 12 per cent per annum, and most loans are made for 12years. During negotiations, it has been assured that BAB would initiateseparate accounting of its commercial and subsidized operations.

E. Government Policies on Livestock Development

12. The Government has recently emphasized in its policies the develop-ment of the beef and wool industries, and BAB is playing a major role inchannelling funds to these sectors. The Government has also initiated anambitious plan to reorganize the Ministry of Agriculture in an attempt toprovide the ancillary services necessary for development of the livestockindustry. The tax burden on livestock producers has always been kept smalland movement of cattle within the country has remained free. Meat pricesto the producers have remaained unregulated, but those to wfholesalers andretailers have been kept at the same level for the past five years in themain consumption centers (Para. 41).

III. THE PROJECT

A. The Project Area

13. The Project area is that part of the Beni which is predominantlygrassland, and cornprises mainly the very extensive flood plains of theMamore River and its tributaries. Its size is around 12 million ha, twomillion of which are in ranches (Map 1).

14. The climate is tropical with an annual rainfall averaging 1,@00mm, of which sixty per cent occurs in January-April. The mean temperatureis 260 centigrade. Soils are young alluvials, varying from sandy to clayloams, with clay subsoils or pan at a depth of one m or less in extendedareas. The climax vegetation is high forest of many species, while grass-land predominates in the central floodplains (Map 2). The area lies at ageneral altitude of about 250 m above sea level and is very flat. Partialflooding occurs at the time of the summer runoffs.

15. In Bolivia, ranch size is usually expressed in terms of cattlenumbers. In the Beni, approximately 40 per cent of all ranches have a herdsize of between 400 and 1,000 head of cattle. A total of about 300 ranchesare included in this size category. The typical ranch to be developed wouldinitially have about 600 head of cattle and approximately 4,000 ha of pastureland, of which about 2,400 ha would be improved under the Project. TheBeni ranches are extremely understocked, even when taking into account theextensive grazing production system followed in the area. Ranchers havethe right to own five ha of land per head of cattle under the AgrarianReform Law, but the process of title clarification is lengthy and makes itdifficult to obtain credit. As a condition of the proposed IDA credit, aprocess for quick clarification of land titles to participating ranchershas been established by Government.

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B. Description of the Project

16. In view of limited government experience and resources for thistype of development and insufficient supply of breeding stock, the Pro jctwould be restricted to the partial development of 150 commercial beefcattle ranches in the Department of Beni. The Beni has greater immediatepotential for livestock development at higher returns than other lowlandsregions and also has better developed marketing facilities. Project in-vestments and the proposed IDA credit would amount to US$ 4.0 million andUS$ 2.0 million respectively. The Project would represent the first stageof a long-term livestock development program, directed primarily at improve-ment of beef cattle production in the lowlands.

17. Investments would be for fencing, corrals, water points, lightequipment and tools, essential barns and housing, selected pasture improve-ment, purchase of breeding stock (limited to not more than 50 per cent ofindividual ranch development loans), working capital and technical services.The above investments would increase carrying capacity, permit a more effi-cient and fuller utilization of the pasture produced, and improve stockquality and performance. Due to the present understocked condition pre-vailing on most ranches, only about 60 per cent of each participating ranchwould need to be developed under the Project to provide adequate pasturefor existing and projected herd size.

18. As a complement to the Project, BAB will: (a) financially andtechnically assist in the development of about eight representative ranchesin the Departments of Santa Cruz and Tarija; (b) conduct a land tenuresurvey in the lowlands; and (c) carry out a national beef and live cattlemarketing study. The above activities would be undertaken under terms ofreference to be agreed upon with IDA, and would help to provide the basisfor a second stage of livestock development.

C. Cost Estimates

19. The estimated total cost of the project is equivalent to US$ 4.0million and is summarized in the following table:

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Total Dollar Foreign ExchangeInvestment Categories Cost Equivalent Component

(Pesos '000) (UTh?5--'0 - '0-00)

Ranch DevelopmentFencing 9,600 800 256Stock Handling Facilities 1,800 150 0Stock TWatering Facilities 2,400 200 69Stock Management Equipment 900 75 75Constructions 3,900 325 95Pasture Establishment 1,200 100 0Breeding Stock 12,600 1,050 215

Total Ranch Development 32,400h 2,700 710Technical Services 3,600 300 170Short Term Financing 12,000 1,000 -Total Project Cost 48,000 4,000 880Per Cent of Total Project Cost 100 100 22

20. Ranch development costs aggregate US$ 2.7 million or about 68 percent of the total Project cost. Technical services account for US$ 0.3 million(7 per cent), and the balance of US$ 1.0 million (25 per cent) would be forcomplementary short term financing of ranch operating expenses. Due to thenature of the Project, which requires the provision of facilities basic toproper herd and pasture management, the foreign exchange component is onlyUS$ 0.9 million, 22 per cent of total cost.

21. Estimates for on-ranch development costs are based on a representa-tive Beni ranch having 200 breeding cows (Annex 1). Ranch development wouldbe initiated during each of the first three years of the Project. It isexpected that 30, 50 and 70 ranches respectively would initiate developmentduring the first three year period. Individual ranch development would alsotake three years. Therefore, Project implementation would require five years.Technical services estimates are projected for the five year developmentperiod (Annex 2), at the completion of which they are expected to remainconstant and be financed by BAB from interest earnings received from partici-pating ranchers. Total short term credit requirements are projected fromindividual ranch average annual needs (Pesos 80,000) and as such reflect theaverage annual requirements.

D. Proposed Financing

22. The total Project cost of US$ 4.0 million equivalent would befinanced by the ranchers themselves, by DAB and by IDA as follows:

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Ranchers BAB IDACategory (Amount) (T-) (Amount) (%) (Amount) ( 7 Total

(US$ '000 Equivalent)

Ranch Development 540 20 330 12 1,830 68 2,700

Technical Services - - 130 43 170 57 300

Short-Term Financing - - 1,000 100 - - 1,000

Total Project Cost 540 14 1,460 36 2,000 50 4,000

23. For on-ranch development, the owners would contribute an average of20 per cent of the estimated costs in cash and/or kind, considered to be areasonable contribution in view of their present financial position and ex-pected slow improvement during early development years (Para. 44). Theremaining 80 per cent of the cost would be advanced to the ranchers as aloan from BAB. This has been assured during negotiations. It is envisagedthat 85 per cent of the amount of such loans would be reimbursed from theproposed IDA credit (68 per cent of ranch development costs) and that BABwould contribute the balance of 15 per cent (12 per cent of ranch develop-ment costs) from its own financial resources; likewise considered to be areasonable contribution in view of its very restricted availability ofresources for long-term lending. The US$ 0.33 million required is BAB'spresent maximum availability of long-term funds for this Project (Annex 3).

24. The cost of technical services for the participating rancherswould be financed by the proposed IDA credit (57 per cent) and by BAB(43 per cent) during the first five years of the Project. These percentagesroughly correspond to expected foreign exchange and local currency require-ments. These costs would be recovered from the interest payments receivedon ranch development loans and technical services would continue to be paidfrom this source.

25. Short-term credit is of great importance in this Project to meetthe needs of ranchers, especially during the initial phase, growing out oftheir reduced cash flow during early development years and the necessity offinancing fattening operations during years of surplus pasture productionto bring about added liquidity and greater returns (Para. 44). BAB is theonly source of short-term financing available to the participating rancherscharging reasonable interest rates (12 per cent). Although BAB is in a tightfinancial condition (Annex 3), it would be responsible for providing 100 percent of the complementary short-term financing of ranch operating expenses.Assurance for this has been obtained during negotiations. This contributionwould represent a major effort on its part, and as such is included as acomponent of total Project cost.

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26. To ensure implementation, during the first three Project years, ofthe subprojects and studies referred to in Para. 18 they would be financedby interest free Qovernment advances. This has been assured during negotia-tions. These costs would later be recovered by Government from the netinterest differential resulting during the first six years of the Projectand accruing to a special Central Bank Fund (Para. 35). Any additionalfinancing required would be provided by BAB from its own resources.

E. Disbursements

27. BAB would submit to Central Bank documents verifying disbursementsactually made under loans to the ranchers for eligible items of ranch develop-ment. IDA would reimburse Central Bank for 85 per cent of such loans uponreceipt of its certified statement of disbursements. This method is pro-posed since it wi6uld not be feasible to relate .IDA's participation directlyto individual investment items of total expenditures incurred for ranchdevelopment. IDA would not anticipate any increase in this percentage, andany undisbursed balance resulting from savings in the amount allocated fortechnical services under the Credit would also be available for loans toranchers. No reimbursement would be made by IDA for short-term loans. Forthe foreign exchange component of technical services, disbursements would bemade against invoices. In all instances the above documents would need tobe countersigned by the Project Director. Assurances were obtained duringnegotiations that BAB and the Central Bank will maintain separate accountsfor the Livestock Development Project, and that these accounts and thesupporting documentation will be audited at specified intervals by account-ants acceptable to IDA.

F. Operating Results

28. The projected favorable financial implications for the Governmentand for BAB resulting from the Project are set forth in Annex 4, Tables 1and 2. Sub-loan repayments from ranchers not required for administrativeand technical services expenses and debt service would be relent by BAB toranchers during the 16 year period that the resources of the Central BankFund are made exclusively available to BAB. Based upon 100 per cent re-coveries, annual relending during this period would increase the total volumeof lending under the Project by about 85 million pesos

IV. ORGANIZATION AND MANAGEMENT

A. Project Administration and Technical Services

29. A Livestock Project Division (LPD) would be formed in BAB, beforethe Credit Agreement is signed, to administer the Project and to providetechnical services to participating rarchers. It would consist of a projectdirector, an administrative assistant, five field technicians and a loancommittee (Annex 5).

30. The Project Director, to be appointed before the Credit Agreementbecomes effective, would be recruited internationally. His selection andterms of service would be approved by IDA. He would: (a) be responsible

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for the execution of the Project; (b) have the authority to approve theselection, promotion, suspension or removal of LPD staff; (c' assist in thetraining of the technicians and outline their duties and res, onsibilities;(d) report to the President of BAB through its General Managf'; and (e) beultimately responsible for promoting the Project, assisting ranchers in thepreparation of individual development plans, approving and recommending theseplans to the loan committee as the basis for lending and for supervising theexecution of plans for which loans are made.

31. In the selection of the administrative assistant and the fieldtechnicians, preference would be given to veterinarians with experience inpractical livestock production since more emphasis,at this stage of de-velopment, should be given to herd health and management practices than toagronomic improvements. Sufficient qualified staff are available sincetotal requirement is small. Due to the inadequacy of the Ministry of Agri-culture's technical programs, most services would need to be provided tothe participating ranchers by the LPD.

32. A Project loan committee will be created in the LPD before thesigning of the Credit Agreement. It would ratify ranch development plansand would have the unrestricted authority to approve all loans recommendedby the Project Director. The Committee would be composed of the BAB GeneralManager, BAB Credit Manager and the LPD Director. It would disapprove loanapplications only on the basis of the prospective borrower's credit worthi-ness, which would be provisionally determined prior to preparation of thedevelopment plan. Financially and administratively BAB would process theapproved loans through its Trinidad regional office.

B. Lending Operations

Policies

33. Loans to ranchers would be made on the basis of ranch developmentplans prepared by the LPD field technicians and approved by the ProjectDirector. Participating ranchers would have a minimum initial breeding herdsize of approximately 200 cows anr would be required to limit land develop-ment to an area sufficient only for a tripling of herd size during a twelveyear period (approximately 60 per cent of each ranch, e.g. 2,h00 of 4,000ha). Any ranch development loans greater than US$ 100,000 equivalent wouldrequire specific IDA approval. Increased real estate value resulting fromranch development investments would be included in the basis for the esti-mation of security requirements for loans. BAB would restrict its long-termbeef cattle lending operation in the Beni to those of the Project during theIDA disbursement period. During negotiations, assurance has been obtainedthat BAB will adhere to the Project policies herewith outlined.

Terms and Conditions

34. The Credit would be made on normal IDA terms to Government, whichwould assume the foreign exchange risk. Government would cause to be estab-lished an appropriate Central Bank Fund which would administer the proposedIDA credit. This has been assured during negotiations. The Fund would makethe proceeds of the IDA credit available to BAB, in local currency, at aninterest rate of four per cent for a term of 16 years including five years

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of grace. During this 16 year period, repayments not required for ID4 debtservicing would also be made annually available to BAB, on the same termsand conditions, for further lending under the Project. BAB would relend toparticipating ranchers at a maximum of 12 per cent interest (minimum of 10per cent) for a term of 12 years including a four year grace period.

35. The Government would credit the Central Bank Fund with interest-free advances to cover disbursements to BAB, and for purposes of the sub-projects and studies referred to in Para. 18. The Fund would replenish itsresources from the proposed IDA credit and from interest and capital re-payments paid by BAB. In making the resources of the Fund available to BAB,Government would not charge more than four per cent per annum as coveragefor the IDA service charge, advances to the Fund, and any Central Bankadministrative costs resulting from the Project. The capital repaymentsreceived from BAB not required for IDA debt servicing and the net interestdifferential resulting after payment of service charges to IDA, would beused to recover the interest-free Government advances made for financingthe subprojects and special studies mentioned in Para. 18 and for additionallending under the Project during a 16 year period. Following the initial16 year period, Government would make these resources available, throughthe Fund, to BAB and other institutions for further financing of livestockdevelopment. Assurance for this has been obtained during negotiations.

36. BAB's net operating profit, resulting after recovery of admini-strative and technical services expenses from the interest payments paid bythe participating ranchers, and rancher capital repayments not required fordebt servicing to the Central Bank Fund would be relent to ranchers under theProject for the same purpose and on similar terms and conditions. Interestcharge to the ranchers during the relending period would be agreed upon withIDA, but would not be less than ten nor more than twelve per cent. This hasbeen assured during negotiations.

C. Procurement

37. The goods and services required for ranch development would bepurchased by the individual rancher through normal commercial channels. Dueto the nature of the Project most on-ranch inputs are locally produced, andthe small size of the Project avoids major supply problems. Both these on-ranch inputs and the equipment required for technical services are availablethrough local suppliers and representatives of foreign firms, of which thereare sufficient numbers to provide adequate competition in the supply of thegoods required. A very small number of improved sires would be imported andlimited numbers of sires and breeding females would be locally procured.All purchases of livestock required for the Project would be subject to theapproval of the Project Director with respect to quality, source and animalhealth standards. International competitive bidding would not be appropriatefor livestock procurement since animals adapted to the environment, of thetype and quality required, can best be obtained from countries adjacent tothe lowlands.

D. Marketing

38. In the Beni, most of the 35 small slaughterhouses are owned andoperated by beef wholesalers. The principal system of beef transport to LaPaz and the mines during the past 20 years has been by air. Slaughterhouses

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are, therefore, located adjacent to landing strips. Due to a lack of coldstorage facilities in most of the Beni slaughterhouses the carcasses mustbe transported within a few hours following slaughter.

39. Air transport handles more than 50 per cent of Bolivia's total beeftransport. The service is principally provided by one public and five pri-vate companies, which contract trips with wholesalers. The average payloadof the C-46 and B-17 planes is approximately 6.5 tons. The main problemconfronting the air transport industry at present is the lack of financingfor long-term expansion. As far as the Project is concerned, however, airtransport would satisfy the needs of the next decade. A study is beingfinanced by UNDP to investigate the possibilities of road, railroad, riverand air transport for the whole country, and a request has already been pre-sented to US AID by the Aeronautics Council for funds to build three pavedairstrips in the main beef producing centers of the Beni.

40. The producers usually sell their cattle to the wholesalers placedat the slaughterhouses in the Beni. They are paid on a carcass weight basis.The wholesaler is responsible for the slaughter and transport of beef to themain consuming centers of La Paz and the mines. Upon arrival in La Paz, themeat is usually sold directly to the retailers for immediate resale to con-sumers. However, a total cold storage capacity of 250 MT is available inLa Paz, which is sufficient for a ten day supply. Beef for export must alsobe transported to La Paz.

41. The price paid to producers is unregulated and has been steadilyincreasing from 2.0/pesos/kg to 4.2/pesos/kg of dressed weight (period 1960to 1966). The wholesale and retail prices have been frozen since 1962 at5.5 and 6.8 pesos per kg respectively. Average air transport cost per kg ofbeef is 1.1 pesos. The wholesaler is the hardest hit by this situation,since retail prices are in reality higher. For any second stage project,there is a need to progressively liberalize domestic beef prices startingwith the higher value cuts. Export prices to Peru, Chile and isolated zonesof Western Brazil are 40 to 100 per cent higher, and demand is high (theArequipa and Lima markets alone could readily absorb up to four times theirpresent level of purchases in Bolivia, which represents a potential annualdemand of approximately 8,000 MT dressed weight).

42. Cheese has been traditionally produced on a small scale throughoutthe Beni. The expected production increases would be rather small and wouldbe marketed mainly in Trinidad, Santa Cruz, La Paz and the mines.

V. BENEFITS AND JUSTIFICATION

43. The benefits to participating ranchers from investments made underthe Project are projected in Annex 6, Tables 1 through 5. The estimates arebased on a representative 200-cow beef cattle ranch in the Beni. Expectedresults per ranch at various stages of development are summarized below:

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1' After After Total4,000 Ha Ranch-/ Before Five Complete 2 Per Cent

Development Years Development- Increase3/

Total Herd, Head 580 1,030 1,680 190Output, Head 60 80 340 460Net Profit, '000 Pesos 4/ 40 40 160 300Net Profit, '000 Pesos ;/ 40 120 160 300Herd Value, '000 Pesos 260 410 820 220

1/ Average Incremental Investment Cost of 216,000 pesos per ranch.2/ 12 years. 3/ Comparing Before and After Development.IT Plan I (see-Para. 44). 5/ Plan II (see Para. 44).

44. As these projections show, the net profit per ranch would increaseby 300 per cent after twelve years, when intended development is completed.Participating ranchers would experience a reduction in current incom,e duringearly development years due to the retention of heifers previously scld.Herd development, however, would not progress as rapidly as carrying capa-city is increased by the concentrated three-year investment program andimproved ranch management. Since most ranchers would also require an addi-tional annual income to meet previous debt service, they would most likelyengage in the fattening of locally purchased feeder cattle during years twothrough six of development. The introduction of a fattening operation, underPlan II, during these years of surplus pasture production, permits a fullerand more efficient utilization of investment benefits and greater returns,especially to the more progressive entrepreneurs, tripling net income by thesixth year as compared to Plan I (both Plans I and II are identical otherwise -Annex 6, Tables 1 through 5). The purchase of feeder cattle for fatteningwould be financed by BAB as part of the complementary short term financing(Para. 25).

h . The effect of the proposed on-ranch investments and technicalservices would result in an increased output 1/ of more than 400 per centafter a 12-year development period. This would be brought about by an in-crease of approximately 20 per cent in weaning rate, a reduction of fiveper cent in adult mortality, an improvement in stocking rate, a slight in-crease in slaughter weight and a reduction in slaughter age (Annex 6,Table 1). The combined effect would result in a doubling of the extractionrate. Total herd numbers would have increased almost two-fold upon com-pletion of the 12-year development period. In addition, cheese sales wouldbe increased temporarily to provide added liquidity and higher returns toparticipating ranchers.

1/ Total number of cattle slaughtered plus those sold for breeding stockexpressed as a percentage of total herd numbers.

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46. The net increase in total beef production at the twelfth year ofdevelopment is estimated to be 8,400 MT carcass weight per annum, valued atabout US$ 2.7 million at domestic prices to the producer. Assuming thathalf of the increase in beef production would be exported, the Project'sannual gross contribution to Bolivia's foreign exchange earnings would beUS$ 4.2 million equivalent at prevailing prices..

47. Based on the cash flow projections (Annex 7, Tables 1 and 2), thefinancial return to the participating ranchers would be about 19 per centfor Plan I and about 25 per cent for Plan II. For these calculations it hasbeen assumed that the maximum lifetime of the individual ranch developmentplan would be 20 years and that all investments other than livestock wouldhave no residual value at the end of that period. Under these assumptions,the internal rate of return of the entire Project to the economy of Boliviawould be approximately 17 per cent for Plan I and 22 per cent for Plan II.

48. In addition to these direct production effects, the economy wouldgain from the demonstration of proper ranch management techniques. The pro-posed technical services would assist in developing standards for the futureexpansion of the industry, and BAB's technical staff would also be strengthenedand its administrative procedures improved. The Project would made a sub-stantial contribution to the long-term development of the beef industry ofBolivia.

VI. CONCLUSIONS AND RECOMiENDATIONS

49. The Project is the first stage of a livestock development schemewhich is aimed principally at the expansion and improvement of the lowlandsbeef cattle industry of Bolivia. The demand for investment funds is great,and satisfactory returns would result for participating ranchers.

50. The Project is sound and is suitable for an IDA credit of us$ 2.0million. The borrower would be the Government of Bolivia and the CentralBank would act as its financial agent in channelling the credit to BAB, whichwould make long-term development loans to participating ranchers. TheGovernment would bear the exchange risk and the Central Bank would pay, forGovernment, the IDA service charge. The LPD established in BAB wouldadiinister the Project.

51. During negotiations, assurances were obtained that:

(a) The Government will:

(i) assure that the FID control program would be expanded toinclude the Project area (Para. 8);

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(ii) establish a process for the quick clarification of landtitles to participating ranchers prior to signing theCredit Agreement (Para. 15); and

(iii) establish an appropriate Central Bank Fund (Para. 34)adequate for reimbursing promptly to BAB the portion ofsub-loans to ranchers which would be reimbursed from theproposed IDA credit. In making the resources of theFund available to BAB for a 16 year period Governmentwould not charge more than four per cent per annum ascoverage for the IDA service charge, advances to theFund, and any Central Bank administrative costs resultingfrom the Project. The capital repayments received fromBAB not required for IDA debt servicing and the net interestdifferential resulting after payment of service chargesto IDA, would be used to recover the interest free Govern-ment advances made for financing the subprojects and specialstudies mentioned in Para. 18 and for additional lendingunder the Project during a 16 year period. Following theinitial 16 year period, Government would make these resourcesavailable through the Fund, to BAB and other institutionsfor further financing of livestock development (Para. 35).

(b) The Banco Agricola de Bolivia will:

(i) assure that all cattle entering into the Project would beroutinely vaccinated against FMD and Rabies (Para. 6);

(ii) initiate accounting procedures acceptable to the Association(Para. 11);

(iii) limit the purchase of breeding stock to not more than 50per cent of the amount of any individual ranch developmentloan under the Project (Para. 17);

(iv) as a complement to the Project and on terms of referenceto be agreed upon with IDA, financially and technicallyassist in the development of representative ranches inSanta Cruz and Tarija, conduct a land tenure survey in thelowlands, and carry out a national beef and live cattlemarketing survey (Para. 18);

(v) make available for lending to ranchers as promptly asnecessary local currency funds averaging 80 per cent ofthe cost of approved ranch development plans (Para. 23);

(vi) finance the administrative and technical services expensesresulting from the Project with interest earnings (Para. 24);

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- 14i -

(vii) provide the short-term financing requirements of theparticipating ranchers (Para. 25);

(viii) establish and maintain separate accounts for the LivestockDevelopment Project and arrange for auditing these accountsby accountants, and at intervals, acceptable to IDA(Para. 27);

(ix) establish, before the signing of the Credit Agreement,the LPD which would administer the Project (Para. 29),including a Project loan committee which would have un-restricted authority to approve all loan requests underthe Pro.ject, subject, however, to the limitations ofPara. 51(b)(xi) Para. 32);

(x) appoint, before the Credit Agreement becomes effective,a Project Director acceptable to IDA and define his duties,responsibilities and authorities in a manner satisfactoryto IDA (Para. 30);

(xi) make sub-loans to participating ranchers only on the basisof ranch development plans approved by the Project Director,obtain specific IDA approval on all individual ranch de-velopment sub-loans larger than US$ 100,000 equivalent,and restrict its long-term beef cattle lending operationsin the Beni to those of the Project during the IDA dis-bursement period (Para. 33);

(xii) agree with IDA upon the terms and conditions of the initiallivestock development loans to participating ranchers(Para. 34); annually relend to ranchers, for the same pur-pose and on similar terms and conditions (interest chargeto ranchers would not be less than 10 nor more than 12 percent), the surplus collections resulting during the 16 yearProject period (Para. 36); and

(xiii) make all purchases of livestock required for the projectsubject to approval of the Project Director with respectto quality, source and animal health standards (Para. 37).

May 2, 1967

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BOLT _e>aVI

LIESTit. DVELOPME PROJEC

INVEST1 T COSTS" THE EVEtOMM OF 2004-0 BFMW CATTLE RANCHESON-RANCH NVT1fN PRMCT IONS

Average Average Total Cost for 150 RanchesUnits Cost Foreign

INVESTMENT ITEMS Unit Per Per Total Dollar EcheCost Ranch Ranch Cost E alent

(PEsOS ) (PESOS) (PESOS (000) ((US$ 7 000)

Fencing, Km. 4,000 16 64,000 9,600 800 32 256Stock Handling Facilities, No. 24,000 ½! 12,000 1,800 150 0 0Stock Watering Facilities(a) Farm Ponds, No. 2,000 2 4,000 600 50 0 0(b) Well-Mill-Tank, No. 24,000 ½ 12,000 1,800 150 44 69

Constructions(a) Barns, No. I6,ooo ½ 8,000 1,200 100 50 50(b) Houses, No. 36,000 ½ 18,000 2,700 225 20 45

Pasture Establishment, Ha. 400 20 8,000 1,200 100 0 0Breeding Cattle(a) Bulls, No. 3,000 11 34,000 5,100 425 50 215(b) Heifers, No. 500 100 50,000 7,500 625 0 0

Light Equipment and Tools 1/ 6,000 1 6,000 900 100 7

TOTAL - - 216,000 322h/ 2,7Of2

l/ Includes such items as refrigerators, cat-tJie spray5. r3nd genera" animai healTn and husu-anlnry equ-ipment.y/ Altnough it is indicated that a-l heifers would be D""chiasep -- there is a strorl:g a obability

tnaV some of' tnem would De i=norter- fronr Paragual, anc/or Braz-., Tnerefore, the foreign exchangecomponenf, of 26 per cent. as showr.. would be ar. a:.slute rrxmllnirl, .ewise, the value a6 shown is anaverage and not a total.

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

PROJECT ADMINISTRATION BUDGET

ForeignYEARS Dollar Exchange

EXPENDITURE ITEMS 2 3 14 5 Total E Comonent(tOOO PESOS) (PESOS t000) (US$ too US$ t000

OPERATING ElPENSES

Director; Salary 216 216 216 216 216 1,080 90 90Director; Travel 1/ 24 24 24 24 24 120 10 10Admin. Assistant; Salary _ _ 59 59 62 180 15Technicians; Salary V/ 84 170 213 216 217 900 75 -Admin. Personnel; Salary 3/ 24 24 48 48 48 192 16 -Per Diem Allowances 4/ 12 20 28 30 30 120 10 _Office Expenses 5/ 1 4 5 5 5 5 24 2 _Transportation Expenses 6/ 10 20 22 22 22 96 8 -Training Grants 7/ 120 - - - - 120 10 10

Total COerating Expenses 8/ 494 479 615 620 624 2,832 236 110

CAPITAL EXPENSES

Office Furniture 10 6 8 - - 24 2 -Office Equipment 24 12 12 - - 48 4 2Radio Equipment 9/ 60 60 - - - 120 10 10Vehicles 10/ 72 72 - - - 144 12 12Airplane 11/ 432 - - - - .432 36 36

Total Capital Expenses 598 150 20 - - 768 64 60

Total Project Admin. Costs 1,092 629 635 620 624 3,600 300 170

1/ Round trip every two years for director and family. 8/ All salaries includes direct salaries plus Christmas2/ Year 1, 2 technicians; Year 2, 2 additional technicians; bonus, residency bonus, social charges, etc.

Year 3, 1 additional technician. 9/ Due to poor communications, necessary to provide all3/ Year 1, secretary; year 3, bookkeeper. field offices with radio contact with La Paz.4r/ At rate of 65 Pesos per day. 10/ Includes 4 Jeeps/Landrovers.;/ Includes rent and general expenses. 11/ All travel within the project area is by air sinceb/ IneP'des maintenance of vehicles. there are no roads.7/ Inci .-,s 5 training grants.

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ANNEX 3

BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

BANCO AGRICOLA DE BOLIVIA

INTRODUCTION

1. The Banco Agricola de Bolivia (BAB) was established by SupremeDecree dated February 11, 1942, and was reorganized in 1963. Its mainfunctions are to promote agriculture and to provide agricultural credit.The Bank is a legally autonomous government agency under the generaldirection of the Ministry of Agriculture. Long term policies are deter-mined by this Ministry but allocation of funds is the responsibility ofthe Ministry of Finance.

CRGANIZATION AND MNiAGEMENT

Board of Directors

2. The Board of Directors is the highest authority in the directionof BAB's activities and is composed of a President and Vice Presidentappointed by the President of the Republic and three other directors. Oneof these three is appointed directly by the Ministry of Agriculture; thetwo remaining directors are nominated by the private agricultural andlivestock sectors, but must be approved by the Ministry of Agriculture.Terms of office are four years for the President and two years for allother directors.

Executive Committee

3. The Executive Committee, consisting of the General Manager asPresident, and the managers of the four divisions of Credit, Finance andAccounting, Cooperatives and Administration, acts as a decision makingbody and as an advisory group to the Board. This Committee evaluates andapproves large loans, decides on procedures in default cases and performsother normal executive functions.

General Manager

4. The General Manager is selected by the Board of Directors and isofficially appointed by the President of the Republic. He is the principaladministrative and executive authority of the Bank.

AID Consultants

5. As a precondition of the AID US$ 3.7 million loan made to theGovernment and contributed to BAB as equity capital, a full-time four-man

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ANNEX 3Page 2

team of U.S. hired consultants is attached to BAB. They act as technicaladvisers on administration and policy making and have review powers onlarge AID financed loans.

Organization

6. The Bank is organized into three area offices under the nationaloffice. These area offices control eight regional offices which in turnsupervise 34 provincial agencies. BAB's staff are career officials andnumber 170 at present, of whom 50 are located in the national office inLa Paz.

RESOURCES

7. The authorized capital of BAB is B$1,000 million. Lending resourcescome in part from grants and loans and in part from capital subscriptionsby the Government. Special lending programs are carried out by BAB as anagency of the Government. As of June 30, 1966, total resources amounted toB$173.5 million, of which capital funds were B$84.6 million, loan fundsB$44 million and agency funds B$44.9 million. Table 1 gives the detailsof BAB's resources.

LENDING POLICIES AND PROCEDURES

Terms

8. BAB grants short, medium and long term loans. Regulations stipu-late that maximum terms be 18 months for short term, 7 years for mediumterm and 20 years for long term loans. The maximum period on long termloans made to date has been 12 years. Loans for the purchase of machineryand livestock can be granted on a long term basis with a one to four-yeargrace period. The interest rate is 12 per cent per annum for all loans.In the case of loans originating from resources contributed by AID, the 12per cent is mandatory by the terms of the contracts with AID. All loansmust normally be secured by mortgage of real estate or chattels.

Loan Processing

9. Loans are requested and handled through the provincial officesand a satisfactory appraisal procedure is followed. After the loan appli-cations are prepared, they are submitted for review and approval at variousadministrative levels according to the size of the loan; those aboveB$300,000 are approved by the Board of Directors. Usually the periodbetween the agent's visit to the farm and final approval of the loan variesfrom three weeks to two and a half months according to the level involved.

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ANNEX 3Page 3

This period can be exceeded for reasons beyond the control of the BancoAgricola when delays from imperfections in title arise.

Supervision

10. Once the loan is granted the provincial agent is responsible forits collection and for supervision of the farm activities. At least oneannual supervision visit is required but the frequency, extent and intensityof control have been limited by the Bank's shortage of personnel. Super-vision has therefore been concentrated on problem loans.

LENDING OPERATIONS

Loan Portfolios

II. Lending operations have been conducted under three main portfoliosas follows:

Portfolio December 31, 1964 December 31, 1965 June 30, 1966B$'CO0 B$'000 B$'000

Original BAB 3,591 2,876 2,721

BID 15,572 18,896 17,803

SAC/AID 1/ 40,337 54,141 66,059

TOTAL PORTFOLIO 2/ 59,500 75,913 86,583

1/ Supervised Agricultural Credit Program (SAC). On the termination ofthe Program, assets were donated by the U.S.A. to the Banco Agricola.

2/ A further reduction of approximately B$5 million should be made tothese figures to comply with audit recommendations in respect ofprovision for bad debts.

12. Original BAB portfolio disbursements have been discontinued sincethe 1963 reorganization. Loans still outstanding are numerous and recoveryis difficult. Recoveries are not relent under this portfolio.

13. BID portfolio details are shown in Table 2. Most of these loansare made on medium (maximum 7 years) and long term (maximum 10 years) basesat 12 per cent to large scale farmers for livestock and agricultural im-provement. Repayment by borrowers is due in U.S. dollars or Bolivian pesosequivalent. In general, satisfactory security covers the amount of theloans.

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ANNEX 3Page 4

14. SAC-AID portfolio details are shown in Table 2. There are over3,600 borrowers, most of whom are small farmers who are not able to givehigh security. Loans are for general agriculture and livestock and theinterest rate is 12 per cent per annum.

FINANCE AND ACCOUNTS

Accounting and Auditing

15. External auditing is performed annually by an international firmof public accountants (Arthur Young and Company). Internal auditing hasso far been carried out by a public accountant on a contract basis. However,an internal auditing department has recently been established. The ChiefInternal Auditor reports to the Board of Directors through the GeneralManager.

16. The accounting system is still not fully efficient although ithas improved since the Bank's reorganization. BAB will shortly undertake,with the help of consultants, a study of its accounting and administrativeorganization with the object of providing greater efficiency for expandedlending. However, as a condition of the IDA credit, BAB should makewithout delay, a clear distinction between its commercial loans, sub-sidized loans and agency programs and to this effect, start immediatelywith separate accounting of its various operations.

17. Balance sheets and profit and loss accounts are given in Table 3and 4 for the years 1964 and 1965. The auditors recommended a series ofadjustments for the financial years under zeview, especially in connectionwith the accounting of income from interest and provision for losses onloan portfolios. Parts of the recommended adjustments have already beenmade by BAB and the rest will be undertaken during the current year.

Current and Cumulative Situation

18. Prior to the reorganization of 1963 BAB incurred losses whileoperating under inflationary conditions with poor lending policy and in-adequate security. Accumulated losses amounted to about B$9.2 million atDecember 31, 1965, after taking into account the 1965 profit of B$0.9million. At present BAB is recovering from what was three years ago asituation of under-capitalization; it should further improve its financialposition, under present management, as the volume of sound operations in-creases. Table 4 shows improvements in the ratios of income, expenses andnet profit related to average resources for 1965 as compared with 1964.

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ANNEX 3Table 1

BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

BANCO AGRICOLA DE BOLIVIASTATEMENT OF FUNDS

(As of June 30, 1966)

B$'000CAPITAL FUNDS

Share Capital (SubscrThed out of AID Loans to Government) 54,724Donated Capital (SAC) 18,300Capital not Represented by Shares (Government & Revaluation) 7,542

50,566Less Net Losses as of December 31, 1965 9,190

71,376Share Capital (Balance of US$ 2 Million AID loan to Government) 13,250

LOAN FUNDS

Interamerican Development Bank Loan (BID) 18,804AID Loan (US$ 2.1 Million) 25,200

AGENCY FUNDS

Colonization Program (US$ 2.6 Million) 31,200Rural Development Program (US$ 1.1 Million) 13,200Coffee Program (US$ 40,000) 480

44 880GRAND TOTAL l7T3,51f

As of June 30, 1966, there remained available for lending approximately 80million Bolivian Pesos of the above listed funds distributed as follows:

Initial Amount Amount Amount NotAvailable Drawn Yet Drawn

AID Loan (US$ 2 Million) 24,000 10,750 13,250

AID Loan (US$ 2.1 Million) 25,200 - 25,200

Colonization Program (US$ 2.6 Million) 31,200 2,441 28,759

Rural Development Program (US$ 1.1 Million) 13,200 814 12,386

Coffee Program (US$ 40,000) 480 360 120

94,080 14,365 79,715

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ANNEX 3Table 2

BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

BANCO AGRICOLA DE BOLIVIABID AND SAC/AID LOAN PORTFOLIOS BY AREA OF COUITRY

(As of June 30, 1966)

BID SAC/AIDNo. of Loans B$t000 No. of Loans B$'OOO

AREA I

Santa Cruz 69 12,105 950 25,670Cochabamba 9 1,350 496 5,901

78 13,455 1,446 31,571

AREA II

Beni 13 3,035 277 15,209La Paz 13 .550 526 8,245Oruro 2 120 175 1,515

28 3,705 978 24,969

AREA III

Chuquisaca - - 446 4,586Potosi _ 235 2,331Tarija 4 643 546 2,602

4 643 1,227 9,519

Total c June 30, 1966 110 17,803 3,651 66,059

Total @ December 31, 1965 144 18,896 3,525 54,141

Total © December 31, 1964 98 15,572 3,140 40,337

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ANNEX 3Table 3

BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

BANCO AGRICOLA DE BOLIVIACONSOLIDATED BALANCE SHEETS

December 31, 1964 December 31, 1965(B$1 000) ($'000)

ASSETS

Cash and Banks 4,904 10,971 1/Loan Portfolio 59,500 2/ 70,960 3/Accounts Receivable 1,039 1,329Assets for Resale 1,170 582Foreclosed Properties 962 1,095Property & Equipment 3,847 2,000Other Assets 514 596Outstanding Balances4/ 6,206 -

TOTAL ASSETS 78,942 87,533

CAPITAL & LIABILITIES

Current Accounts 320 211National Treasury 4,157 3,787BID Loan 17,769 19,740Loan Banco Central 3,682 -Colonization Program - 1,009Rural Development Program - 695Other Liabilities 1,876 1,309Outstanding Balances 4/ 6,249 -

Capital and Deficits

Capital:Share Capital 25,981 43,975Donated Capital 21,321 18,300Other Capital 7,676 7,698

54,978 69,973

Deficits:Previous Losses 6,268 10,058Current Results 5/ (3,821) 867

10,089 9,191

44,889 60,782

TOTAL CAPITAL & LIABILITIES 78,942 87,533

1/ Includes the amount of B$8.7 million loan funds obtained from internationalagencies and earmarked for specific programs. 2/ Before provisions forbad debts. 3/ After provisions for bad debts. V/ The auditors suggestedthe distribution of the component items of these inter-agency balances tothe corresponding accounts for the purpose of presenting consolidatedfinancial statements. 5/ (Loss) or profits for the year.

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AMNEX 3Table W

BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

BANCO AGRICOLA DE BOLIVIACONSOLIDATED PROFIT AND LOSS ACCOMUTS

December 31, 196)4 December 31, 1965(B$'000) M% (B$'000) (%

Average Resources 68,469 100 93,311 100

Income

Interest 4,348 7,406Commissions 593 315Other 167 105

5,108 7.46 7,826 8.38

Operating Expenses

Salaries and Allowances 4,691 4,393General Expenses 1,992 1,166Depreciation 344 245Uncollectable Documents Written Off 33 -

7,060 10.31 5,804 6.22

Financial Expenses

Interest on Loans 1,869 2.73 1,155 1.23

8,929 13.04 6,959 7)45

(Loss) or Profit for the Year (3,821) (5-58) 867 0.93

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

PROJECT FINANCIAL STATEMENTSCENTRAL BANK FUND - PROJECTED RECEIPTS AND DISBURSEMENTS

YEARS 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

(THOUSAND PESOS) 1/

CASH INFLOW

Credit from IDA for Ranch Development 2/ 1,800 4,800 8,000 5,600 2,000 - - - - - - - - - - -

Credit from IDA for Technical Services 700 400 300 400 300 - - - - -

Loan Repayments by BAS - - - - - 1,200 1,200 1,200 1,200 2,400 2,460 2,660 2,761 2,8614 4,188 4,444

Interest Payments by BAB (14%) - 100 308 640 880 972 972 1,004 1,037 1,071 1,107 1,135 1,171 1,211 1,257 1,314

Sovernment Advances for Special Studies 3/ 500 855 1,000 - - - - - - - - - - - - -

3,000 6,155 9,608 6,640 3,180 2,172 2,172 2,204 2,237 3,471 3,567 3,795 3,932 4,075 5,445 5,758

CASH OUTFLOW

Initial Loan to BAB from IDA Credit 2,500 5,200 8,300 6,ooo 2,300

Payments of IDA Service Charge (0.75%) - 20 58 120 165 182 182 182 182 182 182 181 179 178 176 174

Repayments to IDA - - - - - - - - - - 243 243 243 243 243 243

Special Studies 3/ 500 855 1,000 - - - - - - - - - - - - _

Recovery by Government of Advances for Special Studies 4/ - 80 250 520 715 790 - _ _ - _ _ _ _ _ _

Subsequent Loans to BAB from Surplus Collections 5/ - - - 1,200 1,990 2,022 2,055 3,289 3,142 3,371 3,510 3,654 5,026 5,341

3,ooo 6,155 9,608 6,640 3,180 2,172 2,172 2,204 2,237 3,471 3,567 3,795 3,932 4,075 5,445 5,758

1/ Figures are rounded.2/ Government would make interest free advances to the Central Bank Fund as required to cover disbursements to BAB prior to reimbursement by IDA.3/ To allow the subprojects and special studies mentioned in Para. 18 of the appraisal report to be carried out during the early years of the Project, Sovernment would make interest free

advances to the Central Bank Fund for this purpose. These advances would be recovered by Government as shown in footnote four.4s/ The net interest differential resulting for the Central Bank Fund, during the first six years of the Project, would be earmarked for financing the subprojects and special studies S

mentiored in Para. 18 of the appraisal report. H 5

5/ All collections from BAB over and above the amounts required for IDA debt servicing and for the special studies would be made available to BAB for further lending under the Project.

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

PROJECT FINANCIAL STATEMENTSBAB - PROJECTED RECEIPTS AND DISBURSEMENTS

YEARS 1 2 3 4 5 6 7 8 9 10 U 12 13 14 15 16

(MILLION PESOS) 1/CASH INFLOW

IDA Funds for Rancher Loans from Central Bank Fund 1.8 4.8 8.0 5.6 2.0 - - - - - - - - - - _IDA Funds for Technical Services from Central Bank Fund 0.7 0.4 0.3 o.4 0.3 - - _ _ _ _ _ _ _ _ _BAB Funds for Rancher Loans 0 3 0 8 1.5 lv0 o.4 - - _ _ _ _ _ _ _ _ _BAB Funds for Technical Services o:6 2/ 0:2 0.3 0.2 0.3Rancher Loan itepayments - - - - 0.3 0.7 1.5 2.0 2.9 3.6 4.5 5.5 5.6 4.6 3.1 4.4Rancher Interest Payments (12%) - 0.3 0.9 2.1 2.8 3.1 3.5 3.8 4.2 4.5 4.9 5.4 5.9 6.5 7.2 7.9Surplus Collections from Central Bank Fund 3/ - - - - - 1.2 2.0 2.0 2.1 3.3 3.1 3.4 3.5 3.7 5.o 5.3

3.4 6.5 lo.9 9.3 6.1 5.o 7.0 7.8 9.2 11.4 12.5 14.3 15.0 14.3 15.3 17.6

CASPI OUTFLOW

Loans to Ranchers(a) From initial BAB and IDA Funds 2.1 5.6 9.4 6.6 2.4 - - - - - - - - - -(b) From BAB's Surplus Collections 4/ - - - - - 3.3 2.0 2.8 4.1 3.8 5.- 6.3 6.7 6.2 4.1 5.8(c) From Central Bank Fund's Surplus Collections - - - - - 1.2 2.0 2.0 2.1 3.3 3.1 3.4 3.5 3.7 5.o 5.3

2.1 5.6 9.4 6.6 2.4 4.5 4.o 4.8 6.2 7.1 o.1 9.7 10.2 9.9 9.1 11.1

Loan Repayments to Central Bank Fund - - - - - 1.2 1.2 1.2 1.2 2.4 2.5 2.7 2.8 2.9 4.2 4.4Interest Payments to Central Bank Fund (4%) - 0.1 0.3 o.6 0.9 1.0 1.0 1.0 1.0 1.1 1.1 1.1 1.2 1.2 1.2 1.3Technical Services 1.2 o.6 0.6 0.6 o.6 o.6 o.6 o.6 o.6 0.6 o.6 o.6 o.6 o.6 o.6 o.6Share of General Administration 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2Reu;overy by BAB of Technical Services Expenditures 5/ - - - - - 1,6 - - - - - - - - - -

3.4 6.4 10.4 7.9 4.o 9.1 7.0 7.8 9.2 11.4 12.5 14.3 15.0 14.8 15.3 17.6

Cash Surplus or (Deficit) 6/ - 0.1 0.5 1.4 2.1 (4.1) - - - - - - - - - -

3.4 6.5 10.9 9.3 6.1 5.0 7.0 7.8 9.2 11.4 12.5 14.3 15.0 14.8 15.3 17.6

1/ Figures are rounded.7/ Includes 0.1 million pesos for first year share of general administration costs.1/ All collections from BAB over and above the amounts required for IDA debt servicing and for the special studies would be made available to SAB for further

lending under the Project.4/ BAB's net operating profits and rancher repayments not required for debt servicing would be relent to ranchers under the Project.5/ In year six, BAB would recover the amounts initially advancedfor technical services and share of general administration from cash surplus (see footnote six).;/ A relatively small amount of cash surplus is allowed to accumulate during the early years of the Project (most accumulates in years four and five) to provide greater flexibility. ) z

In year six, following completion of IDA disbursements, the accumulated balance is used to repay BAB for initial technical services expenditures and for relending to ranchersunder the Project.

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BOLIVIA: LIVESTOCK DEVELOPMENT PROJECTORGANIZATIONAL CHART OF THE BAB LIVESTOCK PROJECT DIVISION

BOARD OF DIRECTORSAND

PRESIDENT

GENERAL MANAGER V -, LA PAZ

LIVESTOCK PROJECT DIVISIONLOAN COMMITTEE

BAB GENERAL MANAGERLIVESTOCK PROJECT DIVISION I BAB CREDIT MANAGER

LPD PROJECT DIRECTORPROJECT DIRECTOR__

PROJECT ADMINISTRATIVE ASSISTANT

TRINIDAD

PROJECT DIRECTORPROJECT ADMINISTRATIVE ASSISTANT

PROJECT FIELD TECHNICIANS

TRINIDADMAGDALENA SANTA ANA SAN BORJA

CERCADO

I BRD -3181

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BOLIVIA

LIVESTOCK DEVELOPRNT PROJECT

DEVELOPMENT OF 200-CO; BEEF CATT2Z RANCHESHERD DEVELOPMENT PROJECTIONS

Value of CattleY~ear Y~ears Before

CATEGORY UNIT o-6 7-12 Beginning Y E A R SPesos Pesos Development 1 2 3 4 5 6 7 8 9 10 1: 12

HERD COMPOSITION

Cows No. 500 601 200 200 250 300 300 320 350 400 470 500 500 500 500Bulls 3,000 3,000 10 10 12 15 10 10 10 12 14 15 15 15 15Calves 1/ 200 300 (100) (100) (138) (180) (196) (224) (262) (300) (352) (376) (376) (376) (376)Two-year old Heifers 400 500 46 46 46 47 66 86 95 105 127 145 171 182 182One-year old Heifers 300 400 50 50 50 69 90 98 112 131 150 176 188 188 188Three-year old Steers 500 600 42 42 43 43 45 63 83 40 - - - - -Two-year old Steers 400 500 46 46 46 47 66 86 95 109 127 145 171 182 182One-year old Steers 300 400 50 50 50 69 90 98 112 131 150 176 188 188 188Fattening Cull Females 5 450 550 42 42 43 53 45 43 53 42 36 47 50 50 50

Total (icl. calves) - - 586 586 678 813 908 1,028 1,172 1,274 1,426 1.580 1,656 1,681 1,681Total (exel. calves) A.U.2/ - - 465 465 520 610 712 780 910 950 1,052 1,204 1,280 1,280 1,280

Value (incl. calves) 3/ - - 256 256 296 352 368 412 467 597 698 770 808 818 818

MORTALITY

Two-year old Heifers No. - - 4 4 3 3 2 3 3 3 3 4 4 5 5One-year old Heifers n _ - 4 4 4 3 3 4 3 3 4 5 5 6 6rhree-year old Steers - - 3 3 3 3 2 2 2 2 1 - -Two-year old Steers - - 4 4 3 3 2 3 3 3 3 4 4 5 5One-year old Steers It - - 4 4 4 3 3 4 3 3 4 5 4 6 6Fattening Cull Females - - 20 20 16 16 18 12 9 13 14 14 19 16 16

Total - - 39 39 33 31 30 28 23 27 29 32 36 38 38

SALES

Three-year old Steers No. 700 800 39 39 39 40 41 43 61 81 39 - - - -Two-year old Steers - 800 - - - - - - - 52 106 123 141 166 177Two-year old Heifers - 500 - - - - - - - - - 46 91 U16 127

Fattening Cull Females 600 600 22 22 26 27 25 33 34 40 28 22 28 34 34Bulls n 800 800 2 2 2 2 5 2 2 2 2 2 3 3 3

Total -_ 63 63 67 69 71 78 97 175 175 193 263 319 341

PURCHASES

Breeding Age Heifers No. 500 - - 50 50 - - - - - - - - -Breeding Age Bulls n 3,000 3,000 2 2 4 5 - 2 2 4 4 3 3 3 3

Total - - 2 52 54 5 - 2 2 4 4 3 3 3 3

PRODUCTION DATA

Effective Calving Nate % - - 50 50 55 60 65 70 75 75 75 75 75 75 75Adult Mortality % - - 8 8 7 6 5 4 3 3 3 3 3 3 3Extraction Rate % - - 11 Ui 10 6 8 a 8 14 12 12 16 19 20Stocking Rate Ha,A.U. - - 3 3 3 3 2.5 2.5 2 2 2 2 2 2 2Carrying Capacity4/ A.U. - - 800 800 800 800 960 960 1,200 1,200 1,200 1,200 1,200 1,200 1,200Dressed Neight per Heada) Three-year Steers K0 . - - lo 160 180 180 10 180 180 200 200 - - - -b) Two-year Stemrs Kg. - - - - - - - - - 200 200 200 200 200 200

c) Fattening Females Kg. - - 150 150 150 150 160 180 180 200 200 200 200 200 200d) Bulls Kg. - - 200 200 200 200 220 220 220 250 250 250 250 250 250

1/ weaned Calves.7/ For ease of calculation of animal unita, oach existing animal, with -he oxception of calves, is considered to se tne e.uivalent of one anicma unit. How"ver, since fattening cull l'

females would be maintained only about six months, they are 'stl-mted to be only 0.5 animal unit.3/ In thousand Pesos.77/ Ssctmat-d total nuo-er of animal un't, it would De posaicle to maintain on the ranch during one year.

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BOLIVIA

LIVESTOCK DEVELOPHMENT PROJECT

DEVELOPMENT CF 200-COW BEEF CATTLE RANCHESSALES PROJECTIONS

BeforeCATEGORY Beginning YEARS

Development 1 2 3 _4 5 6 7 6 9 10 11 12

(PESOS '000)

Three-year old Steers 27 27 27 28 29 30 43 65 31 - - _ _Two-year old Steers - - _ - - - - 42 85 98 133 133 l1,2Two-year old Heifers - - - - - - - - - 23 46 58 64Fattening Cull Females 13 13 16 16 15 20 20 24 17 13 17 20 20Bulls 2 2 2 2 14 2 2 2 2 2 2 2 2

SUB-TOTAL 42 42 45 46 48 52 65 133 135 136 198 213 228

CHEESE I/ 16 16 20 24 36 39 42 16 19 20 20 20 20

TOTAL PLAN I 58 58 65 70 84 91 107 14 9 154 156 218 233 248

FATTENING OPERATION 2/ - - 76 76 76 76 76 - - - - - -

TOTAL PLAN II 58 58 141 146 160 167 183 149 1514 156 218 233 248

1/ Cheese Sales: Estimated to return 160 Pesos/cow milked/year. During years 0-3, 50 per cent of the cows wouldbe milked 100 days; years 4-6, 75 per cent of cows would be milked and years 7-12, 25 per cent of the cowswould be milked. It is estimated that each cow would produce 2 liters of milk per day or 200 liters duringthe 100 day milking season. It requires 10 liters of milk to produce 1 kilogram of cheese. This resultsin a production of 20 kilograms of cheese/cow milked/year. Cheese is sold at 8 Pesos per kilogram resultingtn a return of 160/Pesos/cow milked/year.

2/ .inety five head at 800 Pesos/head annually during years two through six.

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

DEVELOPMENT OF 200-COW BEEF CATTLE RANCHESOPERATING EXPENSES PROJECTIONS

BeforeOPERATING EXPENSES Beginning YEARS

Development 1 2 3 4 5 6 7 8 9 10 11 12

(PESOS '000)

Labor 1/ 4 4 4 4 8 8 8 13 13 13 13 13 13Vaccines 2/ 3 4 5 7 8 10 12 13 15 16 16 17 17Veterinary Supplies 3/ 2 3 4 6 7 8 9 10 12 12 13 14 14Salt 4/ 2 3 5 6 6 8 9 10 12 12 13 14 14Bone Meal 5/ - - 1 3 5 7 9 9 I1 11 11 12 12Maintenance 6/ 1 1 1 1 1 1 1 1 6 8 9 9 9Purchase of BLls 7/ 6 - - - - 6 6 12 9 9 9 9 9

TOTAL PLAN I 18 15 20 27 35 48 54 68 78 81 84 88 88

PURCHASE FATTENING ANIMALS 8/ - - 50 50 50 50 50 - - - - - -

FATTENING OPERATION EXPENSES 9/ - - 2 2 2 2 2 - - - - - -

TOTAL PLAN II 18 15 72 79 87 100 106 68 78 81 84 88 88

1/ Basic salary of 150 Pesos per month plus 200 Pesos per month for food and medicines per cowboy resulting in a costof 4,200 Pesos per cowboy per year. Years 1 to 3: one cowboy; years 4 to 6: two cowboys; years 7 to 12: 3 cowboys.

2/ Vaccine cost would gradually increase from 6 Pesos per head in year one to 10 Pesos per head in year twelve due to amore intensive application of disease control measures.

3/ General herd health expenses would increase gradually from 5 Pesos per head in year one to 8 Pesos per head in yeartwelve due to application of a more intensive animal health program.

4/ Cost per head increased from 5 Pesos in year one to 8 Pesos in year twelve.</ Due to the fact that at present mineral feeding of cattle is not practiced, consumption and consequent cost per head

in early years is quite low. Cost per head is estimated to increase from 0.5 Pesos in year one to 7 Pesos in year e-3 :twelve.

6/ Estimated to be two per cent of original value of corrals and five per cent of original value of buildings, fences m .and , itter facilities. w CY

7/ Based upon herd development projection at an average cost of 3,000 Pesos per bull purchased.8/ Based upon 100 head per ranch at 500 Pesos per head during years two through six.7/ Estimated at 20 Pesos per head per year.

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

DEVELOPMENT OF 200-CoW BEEF CATTLE RANCHESFINANCIAL PROJECTIONS - PLAN I

BeforeITEM Beginning YEARS

Development 1 2 3 4 5 6 7 9 10 11 12

(PESOS '000)1. Cash Inflow

(a) Total sales Plan I 58 58 65 70 84 91 107 149 154 156 218 233 248(b) Loan - 70 70 34 - - - - - - - - -(c) Total cash inflow 58 128 135 104 64 91 107 149 154 156 216 233 245

2. Cash Oatflow(a) Rancher's investment contribution 1/ - 8 8 5 - - - - - - - - -(b) Investment of loan funds - 70 70 34 - - - - - - - - -(c) Operating expenses Plan I 18 15 20 27 35 48 54 68 78 81 84 88 88(d) Total cash outflow 18 93 98 66 35 48 54 68 75 d1 84 88 88

3. Cash Balance (lc-2d) 40 35 37 38 49 43 53 81 76 75 134 145 1604. Interest Payments

(a) Loan 2/ - 8 17 21 21 21 19 18 17 15 12 8 4(b) Operating expenses 3/ - 2 2 3 4 6 6 8 9 10 10 11 11

5. Cash balance after interest payments(3-4) 40 25 18 14 24 16 28 55 50 50 112 126 1456. Loan amortization 4/ - - - - - 9 9 17 17 26 26 35 357. Cash balance after loan amortization (5-6) 40 25 18 14 24 7 19 38 33 24 86 91 1108. Accumulated cash balance 40 65 83 97 121 125 147 185 218 242 325 419 5299. Accumulated incremental herd value - - 40 96 112 156 211 341 442 514 552 562 56210. Total accumulated value (8+9) 40 65 123 193 233 254 358 526 660 756 580 981 1,091

1/ Twenty per cent of total investment costs, 50 per cent of which is provided as labor and materials.2/ Twelve per cent including payment for technical services.3/ Twelve per cent on total operating expenses. 6 ¢

4/ Repayment schedule of 5, 5, 10, 10, 15, 15, 20 and 20 per cent.

El

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

DEVELOPMENT OF 200-COW BEEF CATTLE RANCHESFINANCIAL PROJECTIONS - PLAN II

BeforeITEM Beginning YEARS

Development 1 2 3 4 5 6 7 8 9 10 11 12

(PESOS '000)1. Cash Inflow

(a) Total sales Plan II 58 58 141 146 160 167 183 149 154 156 218 233 248(b) Loan - 70 70 34 - - - - - - - - -

(c) Total cash inflow 58 128 211 180 160 167 183 1)49 154 156 218 233 245

2. Cash Outflow(a) Rancher's investment contribution 1/ - 8 8 5 - - - - - - - - -

(b) Investment of loan funds - 70 70 34 - - - - - - - - -(c) Operating expenses Plan II 18 15 72 79 87 100 106 68 78 81 84 88 88(d) Total cash outflow 18 93 150 11 87 100 106 68 78 51 84 BB 58

3. Cash Balance (lc-2d) 40 35 61 62 73 67 77 81 76 75 134 145 1604. Interest Payents

(a) Loan 2/ - 8 17 21 21 21 19 18 17 15 12 8 4(b) Operating expenses 3/ - 2 9 9 10 12 13 8 9 10 10 11 11

5. Cash balance after interest payments (3-4) 40 25 35 32 42 34 45 55 50 50 112 126 1456. Loan amortization 4/ - - - - - 9 9 17 17 26 26 35 357. Cash balance after loan amortization (5-6) 40 25 35 32 42 25 36 35 33 24 56 91 1108. Accumulated cash balance 40 65 100 132 174 199 235 273 306 330 416 507 6179. Accumulated incremental herd value - - 40 96 112 156 211 341 442 51h 552 562 56210. Total accumulated value (8 + 9) 40 65 140 225 286 355 446 614 748 844 948 1,069 1,179

1/ Twenty per cent of total investment costs, 50 per cent of which is provided as labor and materials.2/ Twelve per cent including payment for technical services.3/ Twelve per cent of total operating expenses.4/ Repayment schedule of 5, 5, 10, 10, 15, 15, 20 and 20 per cent.

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

BENEFITS AND JUSTIFICATION 1/INCREMENTAL COSTS AND BENEFITS - PLAN I

Y E A R SITEM 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15v

(MILLION PESOS)BENEFITS

Incremental Sales - 0.21 0.71 1.87 3.13 4.94 7.49 10.86 i4.l1 16.42 20.11 25.65 27.45 28.50 28.50

COSTS

Total On-Ranch Investment Costs 2.59 6.91 11.67 8.21 3.02 - - - - - - - - - -Incremental Operating Costs (0.09)l (o.o9)-2 0.16 1.10 2.38 3.77 5.40 6.82 8.39 9.33 9.81 10.22 10.50 10.50 10.50Technical Services 1.09 0.63 o.64 0.62 0.62 0.40 o.40 0.440 0.40 0.40 0.40 0.40 0.40 0.40 0.40

TOTAL COSTS 3-59 7.45 12.47 9.93 6.02 4.17 5.80 7.22 8.79 9.73 10.21 10.62 10.90 10.90 10.90

Net Flow (3.59) (7.24) (11.76) (8.06) (2.89) 0.77 1.69 3.64 5.32 6.69 9.90 15.03 16.55 17.60 17.60

Net Flow to Ranchers / (2.50) (6.61) (11.12) (7.44) (2.27) 1.17 2.09 4.04 5.72 7.09 10.30 15.43 16.95 18.00 18.00

NOTES: (a) The financial rate of return of the project over a twenty year period is 19 per cent.(b) The economic rate of return of the project over a twenty year period is 17 per cent.

Based on 30 ranches started first year, 50 second year and 70 third year; total of 150.J Based on a reduction of operating costs of 3,000 pesos per ranch during first year.3/ Excluding technical services./ Costs and benefits continue unchanged after year 15. At the end of year 20 the increase in the value of the herds

totalling 7.43 million pesos is taken into consideration for calculating both rates of return.

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BOLIVIA

LIVESTOCK DEVELOPMENT PROJECT

BENEFITS AND JUSTIFICATIONINCREMENTAL COSTS AND BENEFITS - PLAN II 1/

ITEM Y E A R S1 2 3 14 5 6 7 58J

(MILLION PESOS)BENEFITS

Incremental Sales - 2.49 6.79 13.27 14.53 16.34 16.61 16.18

COSTS

Total On-Ranch Investment Costs 2.59 6.91 11.67 8.21 3.02 - - -Incremental Operating Costs (o.o9)2/ 1.47 4.32 8.90 10.18 11.57 11.64 10.46Technical Services 1.09 0.63 o.64 0.62 0.62 0.40 0.40 0.40

TOTAL COSTS 3.59 9.01 16.63 17.73 13.82 11.97 12.04 10.86

Net Flow (3.59) (6-52) (9.84) (4.46) 0.71 4.37 4.57 5.32

Net Flow to Ranchers 3/ (2.50) (5.89) (8.84) (3.84) 1.33 4.77 4.97 5.72

NOTES: (a) The financial rate of return of the project over a twenty year period is 25 per cent.(b) The economic rate of return of the project over a twenty year period is 22 per cent.

1/ Based on 30 ranches started first year, 50 second year and 70 third year, total of 150.2/ Based on a reduction of operating costs of 3,000 pesos per ranch during first year.3/ Excluding technical services.4/ After year 8 the fattening operation ceases and costs and benefits are identical to Plan I, and costs and

benefits continue unchanged after year 15. At the end of year 20 the increase in the value of the herdstotalling 7.43 million pesos is taken into consideration for calculating both rates of return.

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B*LIVIALIVESTOCK DEVELOPMENT PROJECTGENERAL PROJECT LOCATION MAP 1

s- - 46 t

-0Kl 1966 lan-156,4

f / W:::" '''-" f < t{*''1 __'~~~~~~~~~~~~~~~~~~~~~~~~~Orf

t~~6 ' ;",KK < KK.

tK B < E " t t6t 1 b o ° K S W t~~~~~~~~~~~~~~~~~~~~ocl

% l.go..,.daK

pS'\. K K sZ<Kt I K~bol

L.a ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ,,O3CHE

| //\ \/-/e--_y _-_ _ _-

62 ~ ~ P 9 o 4 0 0 IO

t~~~~~~~h

Y^V ME b i 66taH _1 66

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B O L I V I A

LIVESTOCK DEVELOPMENT PROJECTECOLOGY OF THE LOWLANDS (LLANOS) OF BOLIVIA

~~7 Dense forest of the Beni, withInclusions of seasonally waterloggedgrassland

u-.;;--lMedium to light forest of Santa Cruz,X ... with inclusions of edaphic and five-Lt-!..L..jclimax grassland

: : .''i' Chaco, xerophitic woodland and scrub

i Flood plain grassland of the Beni

7I ~~~~~~~~~~~~~~~with inclusions of forest

-. The "cultivation Steppe" of Santa Cruz

1111I11I11 11I 0 ~~~~~Grassland of the San Matias plalns,

-7 ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~ 3 possibly partly edaphic and partlyflood plain of the Paraguay river

0 loo 200 300 400 500

NOVEMBER 1966 IBRD-1874


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