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World Bank Document Document of MICROyFIqMECot-Y The WorldI 6cport, No. 4g"AJS Type: (. 5AR) Goi!:i, CARL,/ X32'5bm l4:~ M FOR OFFICIAL USIS Public Disclosure Authorized GaJ 3 ReportNo 8952-AL STAFF APPRAISALREPORT DEMOCRATICAND POPULAR REPUBLIC OF ALGERIA Public Disclosure Authorized SAHARA REGIONAL DEVELOPMENTPROJECT SEPTEMBER4, 1991 Public Disclosure Authorized Europe, Middle East and North Africa Region Maghreb Department Public Disclosure Authorized AgricultureOperations Division fThisdoument ks a resicbd dis o ad may be nsedby r s only in tae peromance of ti offkid dutes. its co_tns may not othrWi be dsle Wod Ran antholtMn C_URRUEY EGVALENTS (March 1991) Currency Unit - Algerian Dinar (DA) US$1.00 DA 16.60 DA 1.00 - US$0.60 WEIGHTSAND MEASURES The metric system is used throughout this report GLOSSARYOF ABBREVIATIONS ACV - Agent Communal de Vulgarisation AGID - Agence Nationale de Realisation et de Gestion des InfrastructuresHydrauliques pour l'Irrigationet le Drainage ANRH - Agence Nationale des RessourcesHydrauliques ANRH-DRS - Direction Regionale du Sud de 1'ANRH APFA - Accession a la ProprieteFonciere Agricole cDARS - Commissariat au Developpementde l'Agriculturedes Regions Sahariennes CFVA - Centre de Formationet de VulgarisationAgricole CI - Continental Intercalaire CT - Complexe Terminal CTHE - CommissionTechnique Tuniso/Algerienne de l'Hydrauliqueet de 1'Environnement DAD - De1lgu6 de l'Agriculturede Daira DAS - Domaine Agricole Socialiste DDAHA - Division pour le Developpementdes Activit6s Hydrauliqueset Agricoles DP - Direction de la Planification(Ministry of Agriculture) EAC - ExploitationAgricole Collective ERESS - Etude des Ressources en Eau du Sahara Septentrional INRA - Institut National de la RechercheAgricole d'Algerie IDCN - Institut pour le D6veloppementdes Cultures Maraicheres INPV - Institut de la Protectiondes V4gdtaux ITAS - Institut de Technologiede l'AgricultureSaharienne ITDAS - InstitutTechnique de Developpementde l'AgronomieSaharienne OAMVOR - Office d'Amenagementet de Mise en Valeur du Perimbtre de l'Oued R'hir ORD - Office Nationale des Dattes OPIOR - Office des PerimetresIrrigu6s de l'Oued R'Hir PCU - Project Coordination Unit SONELGAZ - Societe Nationalede l'Electriciteet du Gaz FISCAL YEAR January 1 to December 31 FOROFICIAL WI ONLY STA1FAPPASAL REPORT DEMOCRATICAD POPA REPUBLICOF ALGERIA SAAR REGIONALDMELOMT M Loan and Prgiect Summary BgXWrrov: Democraticand PopularRepublic of Algeria US$57 millionequivalent Terms: Repaymentin 17 years,including 5 years of grace. Interestwill be at the Bank'sstandard variable rate. ProiectOblectives: The proposed Project would: (a) support an environmentallysound development program for the Sahara; (b) assistGovernment in the definitionof a strategy for agriculturaldevelopment within the constraints determinedby thatprogram; (c) strengthen institutions dealingwith management, monitoring, and control of water resources;and (d) test the technical,organizational andmanagerial aspects included in theProject in a first phaseof renovationof oases. --^ecmutingAgent: "Commissariatau Ddveloppementde l'Agriculturedes R6gionsSahariennes" PtrjectDescription: The proposed Project consists of the following components:(a) InstitutionalDevelopment -provision of themeans to plan and monitor agricultural development in the region,including establishment of a monitoring systemfor water resource use andwater and soil quality, strengtheningof the applied research, training institutions and extensionservices, and creation of an agency for O&Mof the drainage infrastructure, and of a Project Management Unit to coordinate Project implementation;(b) Rehabilitationof Oases -drilling of wells,provision of pumpingequipment and construction of irrigation and drainage networks; (c) On-farm Development -agricultureimprovement and supply of inputs;(d) Studies,Technical Assistance and Training- preparation of development plans, feasibility and environmentalassessments for futureinvestments in the sector,provision of technicalassistance and training. Benefitsand Rlsks: Establishmentof the basis for a comprehensiveand controlleduse of the groundwater resourcesto support a balancedand environmentallysound development in the AlgerianSahara; setting up proceduresfor an adequate operation of the hydro-agriculturalinfrastructure; increasein revenuesof the farmingcommunity, presently sufferingfrom shortageof water, decreasingyields and physicaldegradation of the irrigationand drainage Thisdocument has a restricteddistribution and may be usedby recipientsonly in the performance of theirofflcial duties. Its contentsmay not otherwisebe disclosedwithout World Bank authoriztion. - ii networks. The risks concernprimarily (a) Government's commitment to restrain the on-going land distribution in the region,which if allowed to continue at the same pace as in the past would jeopardize the sustainableuse of the water resources, and (b) the lack of farmers' participationin maintainingthe farm drainage system, complementingthe Government'sinvestment effort. nIronMental Issues: The proposedProject has been reviewedin accordancewith the provisionsof OperationalDirective 4.00, Annex A, and placed in environmentalscreening category B. The proposed Project would not require preparation of an environmental assessment and would support improved environmental management in the Project area through incorporation of environmental issues into planning studies and improvements in water management, soil use and crop protection by rehabilitation,demonstration, and research activities. Kstima$ed Pro ec2tCosts Local Foreign Total -US$ million------- InstitutionalDevelopment 3.8 5.2 9.0 Rehabilitationof Oases 24.1 33.1 57.2 Studies/Tecb.Assist./Train. 0.7 1.7 2.4 On-Farm Development 6.16.5 7.6 Total Base Costs 29.7 46.5 76.2 Physical Contingencies 4.3 6.3 10.6 Price Contingencies 3.1 4.5 7L6 Total Project Costs 37.1/ii 57.3 94.4 /g IncludingUS$17.5 million of taxes and duties. - iii - Local Foreign Total -,US$ million------- World Bank - 57.0 57.0 Government 17.0 0.3 17.3 Beneficiaries 2.6L_ 2.6 Net ProjectCost 19.6 57.3 76.9 Taxes and Duties 1L.S *.5 - Total ProjectCosts 37.1 57.3 94.4 Note: We understandthat, under an already-signedloan agreement, EIB is expected to assistGovernment in financingits contribution. Estimated Disbursements: Bank PY 1992 1993 1994 1995 1996 1997 1998 ------------------US$ Million---------- AnuUal 5.0 7.0 12.0 12.0 8.0 8.0 5.0 Cumulative 5.0 12.0 24.0 36.0 44.0 52.0 57.0 Economic Rate of Return: 17 percent NaO: IBRD 22329 STAFF APOUSLUPR DE1OCRATICAND PQPULAR REPUALIC OF AQlGRIA Table of Contents I. INTRODUCTION . .1 II. THE AGRICULTURESECTOR . .1 A. Place of Agriculture in the Economy . .1 B. Recent Developmentsin the AgriculturalSector . 3 C. Agriculture in the Sahara. 4 D. Sector and Regional Issues Relevant to the Project . 5 III. BANK LENDING IN AGRICULTUREAND PAST PERPORMANCE . 7 IV. THE PROJECT AREA..8 A. Introduction .. 8 B. Physical Characteristics .... 9 C. Water Resources. .. 10 D. Population . ... 11 E. Land Tenure and Cropping Systems . 11 F. AgricultureSupport Services . ... 13 G. Infrastructure .... 17 V. TilEPROJECT . .. 19 A. Rationale for BankInvolveent . ....... 19 B. Concept and Objectives . 19 C. Components . ... 20 D. DetailedFeatures . 21 E. Status of Design . 24 P. Costs . ... 25 G. Financing ..... ....... 27 H. Procurement . ..................... 28 I. Disbursements .... ...... 31 This report is based on findings of a pre-appraisal mission which visited Algeria in March 1990, composed of Mr. Carlos Gois (Task Manager), Ms. L. Effron (Economist),Messrs W. Van Tuijl (Sr. Irrigation Engineer), S. Lintner (Sr. EnvironmentSpecialist), P. Van Der Veen (ConsultantAgriculturalist), and N. Saadoun (ConsultantEngineer). - ii - Table of Contentscont'd . Page ng, VI. PROJECT IMPLEMENTATION . 33 A. Organizationand Management . 33 B. Execution and Maintenanceof Project Works. Purchase of Goods 34 C. Monitoring and Evaluation . 35 D. Accounts and Audit . ... 36 VII. BENFITS AND JUSTIFICATION ...... ....... .. 36 A. General . 36 B. Land Use, Yields, and Production . 37 C. Marketing and Prices . 40 D. Farm Incomes . 41 E. Cost Recovery.43 F. Economic Analysis.45 G. Risk and SensitivityAnalysis . 46 H. Sustainability.47 I. EnvironmentalAspects .48 VIII. AGREMNTS REACHED AND RECOMMENDATION.49 In-text Tables Table 4.1 - Water Resources .11 Table 5.1 - Project Cost Summary.26 Table 5.2 - Price ContingencyRates .27 Table 5.3 - Financing Plan . 27 Table 5.4 - ProcurementArrangements .30 Table 5.5 - DisbursementCategories . 32 Table 7.1 - Cropping Patterns and Crop Yields . 38 Table 7.2 - Increasesof Arnual Productionfrom the Project Area . 39 Table 7.3 - FinancialBudgets and Returns to Family Labor . 43 Table 7.4 - Cost and Rent Recovery.45 Sugporting Tables Table 1. Project Componantsby Year .... 51 Table 2. ProJect Cost Summary .... 52/3 Table 3. Estimated Schedule of Disbursementsof Bank Loan . 54 Table 4. Total Budget AllocationEstimates by Agency . 55 Table 5. Major ProcurementPackages . 56 Table 6. Vehicles .57. .i . .. 57 Table 7. List of Oases - Characteristics-Costs. 58 Table 8. Ground Water Balance in Oued R'hir-ProjectScenario . 59 Table 9. Ground Water Balance in Oued R'hir-FullRehabilitation . 60 Table 10. Land Tenure . 61 Table 11. SupervisionPlan .... 62 Table 12. Cost Recovery .... 63 Table 13. Selected Documentsand Data Available in the Project File 64 iii.- 1. ImplementationSchedule . 65 2. Organizationand Management . 66 NU: IBRD 22329 - Project Area LIST OF ANNEXES IN IMPLEMENTATIONVOLUHE
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