Documentof The World Bank FOROFFICIAL USE ONLY
Public Disclosure Authorized Report No.: 18127
IMPLEMENTATIONCOMPLETION REPORT
Public Disclosure Authorized SHAANXIAGRICULTURLAL DEVELOPMENT PROJECT CREDIT1997-CN
June 29, 1998 Public Disclosure Authorized
Public Disclosure Authorized Rural Development and Natural Resources Unit East Asia and Pacific Regional Office
This document has a restricted distribution and may be used by recipients only in the perfonnance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS
Currency Unit = Yuan (Y)
1989 $1=Y 3.76 1990 $1=Y 4.78 1991 $1=Y 5.32 1992 $1=Y 5.42 1993 $1=Y 5.73 1994 $1=Y 8.50 1995 $1=Y 8.30 1996 $1=Y 8.30 1997 $1=Y 8.30
FISCAL YEAR
January 1-December 31
WEIGHTS AND MEASURES
Metric System 2 mu = 666.7 square meters (m ) 15 mu = 1 hectare (ha)
ABBREVIATIONS AND ACRONYMS
EASRD - Rural Development and Natural Resources Sector Unit of the East Asia and Pacific Regional Office EIRR - Economic internal rate of return FIRR - Financial internal rate of return FY - Fiscal year GPS - Grandparent Stock IBRD - International Bank for Reconstruction and Development ICB - International Competitive Bidding ICR - Implementation Completion Report IDA - International Development Association ITC - International Tendering Company of China National Technology Import & Export Corporation NCB - National Competitive Bidding O&M - Operations and maintenance OD - Operational Directive (of the World Bank) PMO - Project Management Office PPC - Provincial Planning Commission SAR - Staff Appraisal Report SDR - Special Drawing Rights
Vice President :Jean-Michel Severino, EAPVP Country Director :Yukon Huang, EACCF Sector Manager :Geoffrey Fox, EASRD Staff Member :Daniel Gunaratnam, Principal Water Resources Specialist, EACCF FOR OFFICIALUSE ONLY
CONTENTS
PREFACE ......
EVALUATION SUMMARY...... v
PART I: PROJECT IMPLEMENTATION ASSESSMENT...... 1 A. Project Objectives and Description ...... 1l B. Achievement of Project Objectives...... 1l C. Implementation Record and Major Factors Affecting the Project ...... 2 D. Project Sustainability...... 5 E. IDA Performance.6 ...... 6 F. Borrower Performance...... 7 G. Assessment of Outcome ...... ,.8 H. Future Operation ...... 10 1. Key Lessons Leamed ...... 10
PART II: STATISTICAL TABLES ...... 12 Table 1: Summary of Assessments ...... 12 Table 2: Related Bank Group Loans and Credits...... 13 Table 3: Project Timetable ...... 14 Table 4A: Loan/Credit Disbursement,: Cumulative Estimate and Actual ...... 15 Table 4B: Loan/Credit Disbursement: Cumulative Estimate and Actual, by Semester ...... 15 Table 5: Key Indicators for Project Implementation ...... 16 Table 6: Key Indicators for Project Operations ...... 19 Table 7: Studies included in Projecit...... 21 Table 8a: Project Costs in Yuan ...... 22 Table 8b: Project Costs in US Dollar's...... 22 Table 8c: Project Cost Increase ...... 23 Table 8d: Project Financing ...... 23 Table 9: Economic Costs and Benefits ...... 24 Table 10: Status of Legal Covenants ...... 25 Table 11: Compliance with Operational Manual Statements ...... 26 Table 12: Bank Group Resources: Staff Inputs ...... 26 Table 13: Bank Group Resources: Missions ...... 26
ANNEX A: ICR MISSION'S AIDE MEMOIRE ...... 27
This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. - iii -
IMPLEMENTATION COMPLETION REPORT
CHINA
SHAANXI AGRICULTUR&L DEVELOPMENT PROJECT
CREDIT 1997-CHA
'REFACE
The Implementation Completion Report (ICR) describes the achievements of the Shaanxi Agricultural Development Project in China, for which Credit 1997-CN in the amount of SDR 78.8 million ($106 million in equivalent) was approved on September 19, 1989, and made effective on December 1:3,1989. The credit was closed on June 30, 1997. It was fully disbursed, and the last disbursement took place on September 5, 1997.
The ICR was prepared by Daniel Gunaratnam (Principal Water Resources Engineer), Wang Xiaolan (Financial Analyst), Zhang Chaohua (Socioeconomist), Jiang Ping (Irrigation Institutional Specialisi:) and Hu Shunong (Construction Engineer- Consultant), and was reviewed by Geoffrey Fox, Sector Manager, Rural Development and Natural Resources Sector Unit, East Asia and Pacific Regional Office (EASRD). The Borrower was unable to provide comments on the final ICR, which are therefore not included as an annex to this ICR..
Preparation of this ICR was begun during the Bank Group's final supervision mission in November 6-17, 1997, and an ICR mission visited Shaanxi Province also during the same period. The ICR is based on materials in the project file and materials provided to the ICR mission. The Borrower contributed to preparation of the ICR by contributing views reflected in the mission's aide-memoire (see Annex A), preparing its own evaluation of the project's execution and initial preparation, and commenting on the draft ICR. Since the Borrower's ICR was too long to be included as an annex and a summary was not provided, the Borrower's ICR has been deposited in the project files.
- v -
CHINA
SHAANXI AGRICULTURE DEVELOPMENT PROJECT CREDIT 1997-CN
In accordance with Operational Policy 13.55 this Implementation Completion.Report was prepared 12 months after Credit 1997-CN was closed on June 30, 1997. However, the project's main components, Donglei Irrigation and Dingbian Water Supply, will only be completed by December 1999. This report is therefore an interim completion report. The project will have to be revisited in December 1999 to determine if all the works are completed and all the objectives of the project are met.
EVALUATION SUMMARY
Project Objectives and Description
1. The main objectives of this project were to boost farm production and incomes of poor households and to provide clean water through a program of investments in irrigation, rural water supply, and agricultural services. The main features of the project were: (a) improving and expanding th[e Donglei Irrigation System in the Guangzhong Plain and supplying water to rural areas; (b) providing potable water and irrigation in Dingbian County where there has been a high incidence of fluorosis because of the high fluoride content in the local water; (c) establishing 2,100 hectares (ha) of fish ponds; (d) establishing eight breeding and five commercial poultry operations; (e) constructing several seed processing and certification plants, and supplying fertilizers; (f) constructing and equipping three agroprocessing pilot plants; and (g) providing local and international training programs to staff involved in implementing the above subcomponents.
2. The project objectives were well designed and were appropriate to the Shaanxi government's strategy of reducing poverty by increasing agricultural production and incomes for the region. They were also consistent with the central government's objective to develop the interior provinces, reduce poverty, and fulfill the basic needs, such as clean water, of some of the poorest people in China.
3. Assessment of the project's ability to achieve the stated objectives must await the expected completion in December 1999 of the Donglei Irrigation and Dingbian Water Supply Components. The project objectives for the other four components (aquaculture, livestock, agroprocessing and seeds) have essentially been achieved. There are, however, solid indications that the objectives of the irrigation and water supply components will be achieved after completion of the unfinished works because most of the major construction issues have been resolved and Shaanxi Government is committed to completing the project. - vi -
Results of Implementation
4. Donglei Irrigation and Dingbian Water Supply Components. Donglei Irrigation Systems are 70 percent complete, though a small subsystem, the Duanjiayuan Irrigation System (3,700 ha) commenced operation in 1996. Following the introduction of irrigation on this system, wheat yields increased by 100 percent. For newly irrigated areas, about 30 to 65 percent of the on-farm works and about 26 percent of the branch canals are scheduled to be completed by December 1999. The farmers have indicated that most of the on-farm works and water cisterns for domestic water supply will be completed by that date, since the land has already been leveled and the canals can be completed very rapidly if water is assured. Initial water testing of the main canal and aqueducts has been carried out. Most of the delays in implementing this component were attributed to disagreements between the Provincial Planning Commission and the Provincial Water Conservancy Bureau over design details of the Luohe Flume. This led to the failure to allocate adequate counterpart funds for this component up until 1995. After a change of management in the Project Management Office (PMO) in 1995, the required counterpart funds were made available, and implementation progressed much more rapidly. On completion of all the works, this component is expected to meet the objectives of providing irrigation and domestic water supply for some 130,000 households.
5. The Dingbian Water Supply Component is about 75 percent complete. The final distribution networks for water supply are expected to be completed during 1999. The main pipeline, pumping, and treatment works have been completed and tested for commissioning. Most of the irrigation works are also expected to be complete by December 1999. Upon completion, this component is expected to meet the objectives of providing safe drinking water for 140,000 people and water for irrigation in Dingbian.
6. Aquaculture Component. The aquaculture ponds, aquatic products, and -marketing and technical training centers were started in 1996. The per-hectare production of fish has far exceeded the amounts indicated in the Staff Appraisal Report (SAR) and has more than satisfied the objectives of the project. During the midterm review, the PMO and the International Development Association (IDA) agreed to reduce the area of ponds planned in the SAR. Land that became available as a result of this decision was given back to farmers who had been resettled in the area from the Sanmenxia Dam. The current per-hectare production of commercial fish is 46 percent higher than the SAR estirnate, while the total production of fish is only 10 percent lower despite a 29 percent reduction in total area. This subproject has provided more than 6,000 jobs, 40 percent of which are held by women.
7. Agroprocessing. The Agroprocessing Component essentially satisfied the project's objectives, which were to create pilot processing facilities. The pilot facilities werc to provide examples and guidance for upgrading processing facilities to meet market demand standards and to provide technical assistance. The apple juice plant and the bee products processing facility were extremely successful in showing that advanced - vii - processing facilities could be constructed and operated successfully. The model juice plant constructed under the project encouraged the collective and private sector to build similar plants using advanced equipment throughout the province. By 1997, about 25 percent of the products from this plant were sold to Japan and the United States. The beef processing plant, however, was not successful. Operations were halted due to several factors including the lack of working capital. The provincial government, however, has assured IDA that credit lines will be guaranteed by the government to restart the operations by end-1998.
8. Livestock Component. This component introduced large-scale poultry farmning and genetic improvements in swine and rabbit farming. All the livestock farms were implemented, except for one commercial farm and one grandparent stock (GPS) farm. One commercial broiler farm was not implemented because of lack of market viability and the grandparent broiler farm was not implemented because of lack of funds. All the poultry farms are operating well, although some are short of working capital because of the financial restructuring of the farms and because of the separation of their operations from government operations. The provincial government has assured IDA that credit lines available to the farms will be guaranteed during the transition period (1996-99) until the farms' production builds up to full capacity. The poultry operations developed under the project stimulated the collective and private sector to build more advanced parent stock and commercial farms along the lines of the IDA-assisted farms.
9. Seed Production and Processing Component. This component demonstrated seed multiplication techniques and promoted seed production in Shaanxi Province. The province used the experience gained from this component to develop a seed multiplication and supply program and to promote the use of high-yield seeds. It is expected that the area of wheat cultivation under the project to be covered by this program would reach 50 percent in 1998 and 80 percent in 2000.
Implementation Experiences
10. With hindsight, the SAR's implementation schedule for the Donglei Irrigation and Dingbian Water Supply Components was far too optimistic and failed to make adequate allowances for the size and complexity of the schemes and the limited capability of Shaanxi Province to rapidly implement this type of project. This resulted in delays in project completion, which is now expected in December 1999. These delays were further exacerbated by the frequent interference of the Provincial Planning Commission (PPC) in design issues. The Livestock, Agroprocessing, Aquaculture and Seed Production and Processing Components, however, were completed well within the SAR schedule.
11. High inflation between 1992 and 1994 increased local counterpart requirements by 160 percent (Y 830 million or $100 million). Local counterpart funds were already short, and the high rate of inflation compounded the problem. The shortage of funds caused serious delays in the Donglei Irrigation and Dingbian Water Supply Components. - viii -
12. The goods procured and the civil works implemented were generally of good quality. Two of the high-head pumping stations, however, were supplied with pumps with serious defects. After initial operation, the pumps needed extensive repairs, which caused further delays in startup. However, the PMO is repairing or replacing most of the pumps.
Sumimary of Findings, Future Operations, and Key Lessons Learned
13. Overall Findings. At this juncture, the project's overall outcome cannot be considered satisfactory, since the major components, Donglei Irrigation and Dingbian Water Supply, remain to be completed. The Aquaculture, Agroprocessing, Livestock, and Seect Production and Processing Components have, however, been successfully implemented, and their results are significant. The most significant accomplishment of these components was the introduction of new technologies, which increased production substantially. In addition, the Agroprocessing and Livestock Components spurred the collective and private sectors to develop 16 additional technologically advanced commercial poultry farms and 30 additional technologically advanced apple juice plants. The Implementation Completion Report's (ICR) revised estimate of the economic rate of return (ERR) is 16.7 percent for the livestock component, 29.1 percent for aquaculture, 24.5 percent for agroprocessing (excluding the beef processing) and 22 percent for seeds. All the ERRs are close to those projected in the SAR except for the seeds component where the SAR original estimate of 54 percent appears unrealistic. Revised ERRs computed for Donglei (23 percent) and Dingbian (14 percent) assume completion of these components by end-1999 and that appropriate arrangements for operations and maintenance (O&M) will be in place. Despite the completion delays and cost increases, the ERR calculated in the ICR for the irrigation component is in line with the SAR's estimates, primarily because of a substantial increase of cash crops in the cropping pattern. The overall ERR for the project is 20 percent compared to the SAR estimate of 23 percent.
-14. Project Impacts. The project has already been successful in generating employment opportunities-6,000 people in aquaculture, 500 in agroprocessing, and 900 in poultry-and in improving the living standards of about 15,000 households. The construction of irrigation and water supply systems has provided opportunities to about 10,000 rural laborers to earn additional cash income by participating directly in the project construction or by working with contractors. In addition, during the execution of the project, vast numbers of people were trained, including some 5,800 women who learned advanced agricultural techniques. Another 20,000 women were employed in fruit orchard management, aquaculture, poultry breeding, and agroprocessing. Significant environmental improvements were accomplished when the wastelands and swamplands created by the backup of waters by the Sanmenxia Dam were converted to aquaculture ponds. In 1995, these ponds began to attract many birds back to the area, some of which are rare endangered species of birds, such as cranes and herons.
15. Sustainability. The Shaanxi government is committed to ensuring the sustainability of the project, which is an important element in the effort to increase - ix- foodgrain, aquaculture and livestock production and to reduce the incidence of poverty in the province. The sustainability of the Donglei Irrigation and Dingbian Water Supply schemes can only be judged when these two components are completed in 1999, the O&M institutions are in place and water charges are agreed with the farmers. However, the sustainability of these two components seems assured since: (a) most of the major construction issues have been resolved and only minor works need to be completed; (b) field interviews revealed that farmers are willing to complete all on-farm works as soon as the main works are completed; and (c) farmers are also willing to pay higher charges for water since they know the benefits of irrigated agriculture. In addition, a detailed O&M plan has been developed and institutionalized to manage the irrigation and water supply schemes. Fish production on the aquaculture farms exceeds the SAR estimates despite lower prices for fish. The aquaculture farms, which have been operating for the past three years, have proved their sustainability in terms of production of fish and loan repayment. Sustainability of the poultry farms is also assured because the farms use up- to-date technology, and production losses are low. Also, because most of the farms are producing parent stock, they do not face the same competition as the commercial farms. Failure to complete the remaining works on the Donglei and Dingbian schemes and to introduce an efficient O&M system and collect adequate water charges to cover all the cost could endanger the sustainability of these schemes. There do not seem to be any major risks for the Aquaculture and SeedLProduction and Processing Components. For the Agroprocessing and Livestock Components, the risks are in obtaining credit for working capital and capturing a sufficient share of the market. These are problems being faced by all enterprises in China.
16. Future Operations. To ensure the success of the project, the PMO will have to supervise the completion of works on the Donglei Irrigation and Dingbian Water Supply schemes. Successful O&M of these systems will require the Provincial Water Conservancy Bureau to ensure a smooth transfer of main irrigation systems to operating groups, such as the Weinan Prefecture Water Management Office, and the on-farm facilities to farmers' groups. Guidelines outlining how these transfers are to take place will have to be drawn up by the Water Conservancy Bureau. The PMO will also be required to: (a) organize training courses for the managers and finance staff of the Agroprocessing and Livestock Components to upgrade their operation and financial skills; and (b) take all measures to guarantee the enterprises lines of credit for their cash flow needs. IDA will continue to monitor the progress of the actions to be taken by the PMO during supervision of other projects in the province.
17. Lessons Learned. The key lessons learned from the project include the following:
(a) The project structure was too complex and should have been simplified by including only the Dornglei Irrigation, Dingbian Water Supply, and Aquaculture Components. The Agroprocessing, Livestock, and Seed Production and Processing Components should have been financed under a separate loan. Their addition to the project resulted in complicated coordination arrangements during implementation.
(b) In retrospect, the project preparation should have focused more on project organization and implementation arrangements. Also, the independence of the PMO from the provincial government in project supervision should have been stressed more clearly, and assurances to this end should have been obtained from the government;
(c) Although procurement procedures followed Bank Group Guidelines, there were some serious deficiencies in the prequalification of pump and motor suppliers. IDA should have insisted on much more stringent prequalification criteria. Also, procurement of major civil works for the Luohe Flume should have been tendered following International Competitive Bidding (ICB) procedures because national contractors were unable to execute this complex structure according to the original designs. To accommodate the local contractors required drastic scaling-down of designs and work standards.
(d) More prompt attention should have been paid by IDA to ensure timely allocation of counterpart funding. Aside from obtaining an assurance during negotiations from provincial and local governments about funding local costs, the estimated counterpart funds necessary each year and their sources should have been identified and discussed at appraisal with the Borrower, in order to ensure that proper attention was paid to the financing of the project. at .6
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Figure 3: Dingbian Water Treatment Plant - I -
CHINA
SHAANXI AGRICULTURE DEVELOPMENT PROJECT
(CREDIT 1997-CN)
PART I: PROJECT IMPLEMENTATION ASSESSMENT
A. PROJECT OBJECTIVES AND DESCRIPTION
1. The main objective of this project was to boost farm production and the incomes of 130,000 households (520,000 people) and provide clean water for some 286,000 people through a program of investments in irrigation, other rural water supply and in agricultural services. The specific objectives of the project were (a) improvement and expansion of Donglei Irrigation System to serve 123,000 hectares (ha) with provision of water supply in the Guangzhong Plain and supplying rural water supply for 156,000 people; (b) the supply of potable water for 140,000 people in Dingbian County where about 35 percent of the people had been suffering from skeletal fluorosis; (c) establishment of 2,100 ha of fish ponds; (d) establishment of eight breeding and five commercial poultry facilities; (e) construction of several seed processing and certification plants and supply of fertilizers; (f) construction and equipping of three agroprocessing facilities; and (g) provision of institutiornal support in each of the components to train staff through local and international training programs.
B. ACHIEVEMENT OF PROJECT OBJECTIVES
2. The achievement of the project objectives can only be fully judged when the major components, Donglei Irrigation and Dingbian Water Supply Components, are completed in December 1999. The project objectives for the other four components (aquaculture, livestock, agroprocessing and seeds) have essentially been achieved. There are, however, good indications that objectives of the irrigation and water supply components will be achieved after completion in 1999 because most of the major construction issues have been resolved and Shaanxi Government is committed to completing the project.
3. The project objectives were generally well designed and articulated in the project documentation and were supported by the Shaanxi government project staff and recipients of the credit for the various components. The objectives also reflected the provincial government's strategy and were consistent with both the Bank Group's development strategy and the Bank Group's Country Assistance Strategy (CAS) at the time of preparation to help the interior provinces to develop. - 2 -
C. IMPLEMENTATION RECORD AND MAJOR FACTORS AFFECTING THE PROJECT
Implementation Record
4. Donglei Irrigation Component. About 70 percent of the Donglei Irrigation System has been completed. Although most of the pumping plants and main canals have been completed, about 26 percent of the branch canals and about 30 to 65 percent of the remaining on-farm works will only be completed by December 1999. Farmers have indicated that most of the on-farm works will be completed in 1999, since the land has already been leveled and the canals can be completed very rapidly if water supply is assured. Initial water testing of the main canal and aqueducts has been carried out, and delivery of water has been made to the newly irrigated area. The quality of the works constructed is good in almost all cases. Most of the delays in implementing this component were caused by management conflicts between the Planning Commission and the Water Conservancy Bureau of the province and the lack of counterpart funding, which have been resolved since 1996. In addition, the inadequate capacity of the local construction companies to implement such a large and complex project, which involved several large aqueducts, caused delays.
5. Dingbian Water Supply Component. The four main pumping stations, tunnels, main canals, main pipeline, water treatment plant and storage facilities and about 56 percent of all the terminal irrigation facilities have been constructed. Initial water testing of all the pumping stations and main canals has been undertaken. All the terminal facilities are expected to be completed by 1999. The quality of works in general is good.
6. Aquaculture Component. All the works under this component were completed or exceeded. Lined ponds comprising 466 ha (7,000 mu), unlined ponds comprising 1,033 ha (15,500 mu), hatcheries, pellet mills, four supply centers, three training centers, etc. were all completed. The total number of farms, each one covering 33 ha (500 mu), was reduced from 64 to 45. The total area of ponds planned in the SAR was 2,100 ha (31,500 mu) but the area was reduced in agreement with the Bank Group during the midterm review because land originally allocated for this purpose was given back to farmers who were resettled from the Sanmenxia Dam. The total annual production of commercial fish is about 8,655 tons. The per-hectare production of commercial fish in the project area is 46 percent higher than the projected output in the SAR for the 2,100 ha, and is only 10 percent less in projected overall production despite a 29 percent reduction in total area. The average income for each farmer in the project area has reached Y 4,000 per year, compared with the average, income of less than Y 2,000 per year for nonproject aquaculture farrners.
7. Agroprocessing Component. The three agroprocessing pilot plants-consisting of an apple juice plant, bee product plant, and a beef processing plant-were completed under this project component. The physical construction and the equipment procurement were very well executed. The physical construction of the Pucheng Slaughterhouse was completed by December 1994 as scheduled. All of these plants were county-owned - 3 - enterprises. However, the provincial governrment introduced radical reforms to separate these companies from the government and convert them to independent corporations. As a result, the credit lines of these enterprises dried up, and the slaughterhouse had to be closed for lack of working capital and for other reasons. The govermnent is now trying to reactivate this plant by giving guarantees to the local banks that will finance the working capital and to see what additional matters need to be resolved. However, both the fruit processing plant and the bee product plant have been operating well and have sufficient internal cash generation despite the credit crunch.
8. Livestock Component. There were eight subcomponents under this component, which included plans for implementing six poultry farms, one pig farm, and one rabbit farm. Under each poultry farm there were several grandparent stock, parent stock, or commercial farms, depending on the location. All the farms, except one commercial farm and one grandparent stock farm, were implemented. The commercial farm was not implemented because of the lack of market viability, and the grandparent stock farm was not implemented for lack of funds. Construction of the Xianyang Pig Farm and Chunhua Rabbit Farm was finished in December 1993, and operations started in 1994. Construction of Grandparent Stock (GPS) Farm, Xianyang Farm, Heyang Farm, and Baoji Layer Farm, Sanmenkou and Weinan Broiler Farm was completed in December 1994 and began operations in 1995. Essentially the quality of the civil works construction was good. Most of the equipment for incubation, feeding, watering, and ventilation was imported. In addition, the grandparent and parent stock for the poultry was either imported or obtained in China from the advanced breeding stations.
9. Seed Production and Processiing Component. The Seed Production and Processing Component was completed by the end of 1993. The project completed four seed processing plants and set up five seed production bases with seed processing workshops and one provincial seed inspection center. The 10 seed companies completed 47,143 square meters (m2) of buildings, 108 percent of the appraised target. Equipment and materials were procured as appraised, including nine sets of seed testing and processing equipment, and fertilizer and pesticides. The seed-growing area was expanded to 10,900 ha for the 10 seed companies. The actual processing capacity of all seed companies has exceeded the design standards of 20,000 tons per seed company.
Major Factors Affecting the Project
10. Implementation Schedule. The project was approved in June 1989 and scheduled for closure June 30, 1994. The closing date was subsequently extended three times, one year each, to June 30, 1997. Four of the six components (Aquaculture, Agroprocessing, Livestock, and Seed Production and Processing) were implemented within the scheduled dates or with slight delays. However, for the Donglei Irrigation and Dingbian Water Supply Components, the original implementation schedule was overly optimistic, and the implementation capacity of Shaanxi Province and the resources available in the province to undertake projects of this size and complexity were substantially underestimated. Completion of all works is now expected by end-1999. - 4 -
11. Changes in Project Management and Conflicts. During appraisal, a Project Management Office (PMO) was set up, with the Provincial Planning Commission (PPC), Finance Bureau and Water Conservancy Bureau taking leadership in the PMO. According to the Credit Agreement, they appointed an executive director from the Water Conservancy Bureau to undertake all day-to-day operations of project implementation. The PMO was to act as an "independent engineer" and be the representative of the government in supervising the contractor. This arrangement was relatively new to the province, since in all previous implementations the government had dealt with the contractor directly without a PMO in between.
12. This arrangement seemed to work well for four of the components-Aquaculture, Agroprocessing, Livestock, and Seed Production and Processing. However, for the Donglei Irrigation and Dingbian Water Supply Components, there were considerable conflicts between the PMO and PPC, which was the government and which wanted to supervise the project directly. Most of the conflicts seem to center around increases in the cost; of works for these two components, which occurred during 1993-94 when inflation in China was up to 25 percent a year. The conflicts delayed the construction of the key structures by three years for the Donglei Irrigation Component. After 1995 though, there were major changes in personnel in the PMO and the provincial government and these changes enabled the work to proceed more smoothly.
13. Inflation and Cost Overruns. The high inflation in China between 1992 and 1994, coupled with the depreciation of the yuan against the US dollar, led to substantial price increases in construction materials (over 100 percent) and labor wages (over 200 percent). This resulted in higher contract prices for major contracts that were awarded after 1992. Together with the change in designs for some key works, the inflation contributed substantial cost increases to the Donglei Irrigation and Dingbian Water Supply Component of about 50 and 15 percent, respectively. Early implementation and sorme design changes of the Aquaculture, Agroprocessing, and Livestock Components actually decreased costs by 22, 25, and 17 percent, respectively. Overall costs increased from $237 million to $300 million.
14. Lack of Counterpart Funds. The counterpart fund requirement increased dramatically from Y 533 million to Y 1,341 million due to local price increases coupled with the currency devaluation. The additional burden caused by price increases and devaluation further exacerbated the shortage of counterpart funds. This shortage seriously affected the implementation progress of the Donglei Irrigation and Dingbian Water Supply Components, especially during 1993-95. Implementation of the Aquaculture, Agroprocessing, Livestock, and Seed Production and Processing Components was not affected by budgetary constraints because these components were completed before the major price increases.
15. Poor Supply of Pumps. Most goods were procured following international competitive bidding (ICB) procedures and, in general, the quality of goods supplied was excellent. However, the supply of the main pumps for the high-head pump stations by a -5- local supplier had some serious flaws, which had to be rectified. The supplier was slow in making the required changes and this caused further delays in the startup testing of the main system for the Donglei Irrigation Component. Strict prequalification procedures could have avoided this problem. The pumps for the low-head pump stations were generally good, even though they were supplied locally.
16. Engineering Complexity. Donglei Irrigation-with 37 pumping stations at five different levels-presented a unique challenge in engineering and construction of such a complex facility. The project appraisal failed, however, to make adequate allowances for the complexity of site conditions. In addition, the Luohe Flume-at 1.29 km in length, the longest flume in China or even in the world-went through several design revisions because of high construction costs and because of the limited capacity of local contractors to implement the flume. Consequently, some of the contracts could only be completed on extended time.
D. PROJECT SUSTAINABILITY
17. The Shaanxi government is committed to ensuring sustainability of the project, which represents a key project to increase foodgrain, aquaculture, and livestock production, and to reduce the incidence of poverty in the province. The project is also part of Shaanxi's long-term plan to invest in agriculture and reduce poverty in the areas away from the Guangzhong Plains, which form the key foodgrain production areas for the poor in Shaanxi. Thus, continued support from the government to sustain the project is assured.
18. The sustainability of the Donglei Irrigation and Dingbian Water Supply schemes can only be judged when these two components are completed in 1999, the operations and maintenance (O&M) institutions are in place and water charges are agreed with the farmers. However, the sustainability of these twvocomponents seems assured since: (a) most of the major construction issues have been resolved and only minor works need to be completed; (b) field interviews revealed that farmers are willing to complete all on-farm works as soon as the main works are completed; and (c) farmers are also willing to pay higher charges for water since they know the benefits of irrigated agriculture.
19. Shaanxi Province is very advanced in reforming water institutions by corporatizing and commercializing them. For both the Donglei Irrigation and the Dingbian Water Supply Components the government formulated detailed O&M plans in 1994. These plans were subsequently revised in 1996. Under these plans, the Weinan Prefecture Water Conservancy Management Office (a government-owned corporation) will operate the main water conveyance systems. This corporation, which is currently operating two other provincial irrigation systems, will sell water to downstream buyers- usually corporations operating branch canals or lateral canals or water user associations. The downstream buyers could be o:ne of three types of organizations-joint stock companies of farmers and water operators, leasing companies who sell water to farmers, or water user organizations. The price of the water has already been computed to be about -6 -
Y 0.25 per cubic meter (m3 ) and will rise to Y 0.45 per m3 to recover all the costs, including major repair, depreciation, and power costs.
20. The aquaculture projects have all been completed, and production exceeds the SAR's estimates. Sustainability does not seem to be a problem. Despite lower prices for fish in 1996, there seems to be no reduction in production. The supporting services, such as feed mills and marketing, serve as models for the establishment of commercial fish farms in other parts of the province.
21. Almost all the poultry farms are operational, although they have been corporatized and are no longer part of the government. Sustainability of the poultry farms is assured, because the farms use up-to-date technology and production losses are low. The farms are currently facing difficulties, however, in obtaining credit lines to finance working capital needs. The government is committed to taking specific measures to guarantee lines of credit to these enterprises until such time as they attain full production. When these components were formulated, there were no advanced commercial poultry farms in the province. There are now some 16 private commercial poultry farms that have copied the structure and modem technology developed under this project. Also, since most of the farms are producing breeding stock, they do not have the same market competition as the commercial farms. The construction of the rabbit farm and pig farm was finished in December 1993, and the farrns began operations in 1994. The pig farm, especially, imported advanced breeding pigs, which produce lean piglets, to sow. The lean piglets are in great demand, and all are being sold.
22. The 10 seed companies have all been completed and put into operation. All exceeded the design production capacity and are continuing to expand their coverage to supply of high-yield seed. The Seed Production and Processing Component has served as a demonstration in seed multiplication and has promoted seed production in Shaanxi Province.
23. Two out of the three agroprocessing plants are fully operational, but the beef slaughterhouse was closed down shortly after it was commissioned for lack of working capital. The juice and bee product plants are fully operational. The juice plant has invested in advanced technology and has clearly demonstrated that it is capable of withstanding competition from other producers on the local market. It is now also exporting products to Japan and the United States.
E. IDA PERFORMANCE
24. The various IDA missions involved in the project cycles leading to and including appraisal, failed to make adequate allowances for the complexity of the project, the limited implementation capacity of the province and the local contractors, coordination complexities arising from the number of agencies involved in project implementation, and the capacity of the province to provide the needed counterpart funding. Because of these failures, IDA's performance must be rated as unsatisfactory. Most of the engineering designs for the Donglei Irrigation and the Dingbian Water Supply Components were prepared by the provincial government several years prior to IDA's involvement. The other project comrponents were prepared by provincial experts with assistance from several IDA preparation missions. IDA experts provided assistance to the province in the fields of pumping stal:iondesign, hydraulics, seed production, poultry and other livestock, aquaculture, and agroprocessing. Overall, the performance of experts provided by IDA during the preparation phase was appreciated by the provincial government.
25. IDA's performance during the implementation phase, on the other hand, was satisfactory. Thirteen supervision missions were undertaken over nine years-an average of one mission a year. The supervision missions made significant contributions to: (a) improving construction methods; (b) resolving technical issues; (c) requiring adequate provision of counterpart funding and working capital for project activities; (d) improving the technical capacity and financial management of enterprises; and (e) educating PMO and county staff on the need for more rigorous marketing of agroprocessing and livestock produce. The advice in many cases had a positive influence on the project. Many project agencies realized the importance of the supervision recommendations and translated into Chinese the models and computation.s for the aquaculture component and used them as teaching materials for their staff. The supervision missions were less successful in helping the PMO and provincial government to resolve the management conflicts that arose during the construction phase. Up until FY96, the provincial government did not recognize the independence of the PMIOas the supervisor for the project on behalf of the government, and many conflicts resulted.
F. BOREROWERPERFORMANCE
26. The performance of the project implementation agencies during the preparation phase was satisfactory. These agencies prepared several comprehensive feasibility studies for the project, which covered many of the technical and institutional factors. They also succeeded in preparing a satisfactory economic and financial analysis for the Donglei Irrigation, Dingbian Water Supply and the Aquaculture and Seed Production and Processing Components. The analysis produced by these agencies for the Agroprocessing and Livestock Components was less rigorous. Performance of the different government agencies during the implementation phase was mixed. The Aquaculture, Agroprocessing, Livestock, and Seed Production ancl Processing Components were implemented in a satisfactory manner. Implementation of the Donglei Irrigation and Dingbian Water Supply Components, however, was unsatisfactory and delayed completion by about five years. The main cause of these delays was the interference in the design aspects of large aqueducts by PPC. Similar interference also took place during awards of supply contracts for the high-head pumping stations. In spite of these problems, the designs and works implemented so far for the Donglei Irrigation and Dingbian Water Supply Components are of high quality. Operating problemnswere encountered subsequently, however, due to the inadequate prequalification procedures used in the procurement of high-head sets of pumping units. -8 -
27. Despite the interference by PPC into the workings of the PMO, project staff at all levels of government and in the various technical departments exhibited full commitment to the project.
28. Project accounts were audited in a timely manner, and in general the audit reports were received by IDA on time.
G. ASSESSMENT OF OUTCOME
29. At this juncture, the project's overall outcome cannot be considered satisfactory since the two major components, Donglei Irrigation and Dingbian Water Supply, remain unfinished. The four other components (Aquaculture, Agroprocessing, Livestock, and Seed Production and Processing) were completed on schedule. The development objectives of these components were essentially achieved and have therefore been rated satisfactory. Revised economic rates of return (ERR) were computed by the Implementation Completion Report (ICR) for the livestock component (16.7 percent), aquaculture (29.1 percent), agroprocessing (24.5 percent excluding the beef processing) and the seed subcomponent (22 percent). All the ERRs are close to those anticipated in the SAR, except for the seed subcomponent where the SAR-projected ERR (54 percent) appears unrealistic. The ICR estimates an ERR of 22 percent for this component. Revised ERRs computed for the Donglei (23 percent) and Dingbian (14 percent) components are based on completion of the works by December 1999, and the introduction of O&M institutions. Despite delays in completing these components and the cost overruns, the revised ERR results are not materially different from those projected in the SAR. This is largely attributed to expected increases in project benefits arising from the increase of the areas devoted to cash crops. Such increases have already been recorded in areas under irrigation. The revised overall ERR for the project is 20 percent compared with the SAR estimate of 23 percent
30. Upon completion at the end of 1999, the Donglei Irrigation Component will have a significant impact on farm incomes. Farmers in the project area have been expecting the delivery of irrigation for several years. Some have dug wells and have already started irrigating small areas, since groundwater is so limited. Based on results under groundwater irrigation, farm incomes are expected to increase substantially when irrigation is completed. Using data obtained from areas under groundwater irrigation, the ICR prepared several household income models. These models show that incomes of farms producing grain will increase from Y 1,850 per household to Y 5,420 per household after the sixth year of irrigation. For farms switching to such cash crops as cotton, the incomes will increase from Y 2,090 per household to Y 6,620 per household; for those switching to orchards incomes will increase from Y 2,330 per household to Y 11,620 per household.
31. The project's overall impact is quite significant. For the Aquaculture Component, the total production of commercial fish in 1997 was about 8,655 tons. This production level is only 10 percent below that projected in the SAR despite a 29 percent reduction in 9- total area. The overall output value from this subcomponent is Y 81.23 million, which is 29.3 percent of the province's total output, compared with an estimated 18.0 percent in the SAR. This subcomponent created more than 6,000 jobs, with women holding about 40 percent of these jobs. The average family income on fish-producing farms has reached Y 4,000 per year, compared with the average income less than Y 2,000 per year for nonproject aquaculture farmers.
32. Results from the Agroprocessing and Livestock (primarily poultry) Components encouraged the private and collective sectors to develop advanced agroprocessing plants for apple juice production, and advanced parent and commercial broiler and layer farms. When the project started in 1989, there were no apple juice plants or cold storage facilities, and most poultry were bred as smallholder backyard farms in Shaanxi Province. Production levels for poultry were very low, and mortality rates were high. Most apples were stored in caves, and the spoilage rates were very high. By 1997 the province had 30 juice plants and 16 advance parent broiler and layer farms owned by private and collective groups. The project's juice plant and cold storage were completed in 1995 and by the end of 1997 they were producing 2,700 tons, of which 500 tons were sold in the Japanese and US markets.
33. Six out of the eight poultry farms constructed under the project are fully operational and are producing chickens for broilers and layers. Mortality rates of chicken in these farms are 2 to 4 percent lower, and hatching rates 6 to 8 percent higher than in most of the other commercial farms. Most of the layer chicks and eggs are sold outside the province-40 percent for the grandparent layer farm and 50 percent for the parent layer farms.
34. At present, the poultry and agroprocessing enterprises created under the project are facing difficulties in obtaining lines of credit for working capital from banks. This is the outcome of recent government reforms under which the status of these enterprises has been changed from government ownership into a corporation. With the change in their status the enterprises have no longer access to lines-of-credit guarantees from the government. The Shaanxi government assured the ICR mission that they will continue to provide credit guarantees until these enterprises reach full production.
35. The completed Seed Component is playing a key role in demonstrating seed multiplication techniques and assisting in the promotion of seed production in Shaanxi Province. At present, the province has an active seed multiplication and supply program to promote the use of high-yield seeds. It is expected that the area of wheat cultivation to be covered under this program in the project area would reach 50 percent of the cultivated area in 1998 and 80 percent in 2000. Seed demand in these years is projected to reach 90,000 tons and 144,000 tons, respectively. Coverage rate would be over 90 percent of the supplied seeds after 2002. - 1O-
H. FUTURE OPERATION
36. The immediate task is to complete the remaining works over the next two years, which consist of 137 km of branch canals and lateral and sublateral canals for the remaining 49,000 ha of newly irrigated areas. In general, the fields are already leveled and in some sections are already sparsely irrigated by groundwater wells. Barring any unforeseen shortages of counterpart funding, these works should be completed as scheduled.
37. Future O&M of the project will require the assistance of the Provincial Water Conservancy Bureau in ensuring a smooth transfer of the irrigation systems to the operations groups. The operation plan is to transfer all O&M to Weinan Prefecture Water Management Office. This office would essentially act as a financially autonomous company responsible for the sale of water. This office will also coordinate with the township and the county to provide clean water for people and livestock. The provincial and prefecture bureaus would also play a role in ensuring the smooth transfer of lateral and sublateral canals from government ownership to farmer groups through auctions, leasing, management contracts or a combination of all three options. Guidelines will have to be drawn up by the Water Conservancy Bureau to articulate the government's policies pertaining to such issues as ownership of facilities, rehabilitation of facilities during operation, water pricing levels, and water allocation for the lateral.
38. Future operations of the Agroprocessing and Livestock Components will require the PMO to organize more training courses for the managers and finance staff of these enterprises to enhance their skills in operations and financial management. The Shaanxi government would take specific measures to guarantee the enterprises' lines of credit until they reach full production.
I. KEY LESSONS LEARNED
39. The key lessons learned from the project are summarized below:
(a) The project structure was too complex and should have been simplified by limiting it to the following components: Donglei Irrigation, Dingbian Water Supply, and Aquaculture. The inclusion in the project of the Agroprocessing, Livestock, and Seed Production and Processing Components added several additional implementing agencies. This addition required complicated coordination arrangements that gave rise to delays in project implementation. Financing of these components could have best been handled under a separate loan.
(b) In retrospect, the project preparation should have focused more on project organization and implementation arrangements. The independence of the PMO in project supervision should have been stressed more clearly, and assurances to that effect should have been obtained from the government. (c) Although procuremenit was fairly carefully monitored and reviewed and the Bank Group Guidelines were followed closely, there were some serious deficiencies:
(i) Prequalification procedures for pump and motor suppliers failed to exclude bidders who were not genuine suppliers and who did not have contractual arrangements with real suppliers. More stringe!i prequalification criteria should have been used. (ii) Procurement of major civil works for the Luohe Flume should have been tendered following ICB procedures because local contractors did not have the capacity to undertake the work, and because designs had had to be altered to fit the contractors' capacity. (d) Timely allocation of counterpart funding is a prerequisite to smooth implementation of a project. IDA should have paid closer attention to the government's failure to allocate funds on time and in the required amount. In addition to written assurances covering project funding that were obtained during negotiations from provincial and local governments, the estimated counterpart funds necessary each year and their sources should have also been identified and discussed with the Borrower. - 12-
PART II: STATISTICAL TABLES
TABLE 1: SUMMARY OF ASSESSMENTS
Irrigation Agriculture A. Achievement of objectives Substantial Partial Negligible Not Substantial Partial Negligible Not applicable applicable
Macroeconomic policies X X Sector policies X X Financial objectives X X Institutional development X X Physical objectives X X Poverty reduction X X Gender issues X X Other social objectives X X Environmental objectives X X Public sector management X X Private sector development X X Other (specify)
B. Project sustainability Likely Unlikely Uncertain Likely Unlikely Uncertain
x x
C. IDA performance Highly satisfactory Satisfactory Deficient Highly satisfactory Satisfactory Deficient
Identification X X Preparation assistance X X Appraisal X X Supervision X X
D. Borrower performance Highly satisfactory Satisfactory Deficient Highly satisfactory Satisfactory Deficient
Preparation X X Implementation X X Covenant compliance X X
E. Assessment outcome Highly satisfactory Satisfactory Unsatisfactory Highly unsatisfactory
Irrigation X Agriculture X Overall X - 13 -
TABLE 2: RELATED BANK GROUP LOANS AND CREDITS
Year of Loan/credit title Purpose approval Status
Preceding Operations:
North China Plain Agriculture Irrigation Development and Land FY82 Completed (Cr. 126 1-CHA) Improvement
Pi-Shi-Hang Chaohu Area Irrigation and Area Development FY85 Completed Development (Cr. 1606/Ln.2579-CHA)
Northern Irrigation Irrigation Development and FY88 Completed (Cr.1885-CHA) Improvement, and Settlement
Gansu Provincial Development Irrigation and Agriculture Development FY88 Completed (Cr. 1793/Ln.2812-CHA)
Following Operations:
Tarim Irrigation I (Cr.2294-CHA) Irrigation and Agriculture Development FY89 Closed 12/97
Irrigated Agriculture Intensification Irrigation and Agriculture Development FY91 Completed 12/97 (Ln.3337/Cr.2256-CHA)
Yangtze Basin Water Resources Irrigation and Area Development FY95 To be competed (Cr.2710/Ln.2874-CHA) 12/2001
Gansu Hexi Corridor Irrigation and Land Development, and FY96 To be completed (Ln.4028/Cr.2870-CHA) Settlernent 12/2006 - 14 -
TABLE 3: PROJECT TIMETABLE
Steps in project cycle Date planned Date actual
Identification 10/87 10/87
Preappraisal 03/88 03/88
Appraisal 06/88 06/16/88
Negotiations 01/89 01/9/89
Board presentation 03/28/89 03/28/89
Signing 09/89 09/14/89
Effectiveness 12/89 12/13/89
Project completion 12/31/93 12/31/99 /a
Loan closing 06/30/94 06/30/97 /b
/a Full project completion is expected 12/99. /b Three one-year extensions were applied. - 15 -
TABLE 4A: LOAN/CREDIT DISBIJRSEMENT: CUMULATIVE ESTIMATE AND ACTUAL ($ million)
FY90 FY91 FY92 FY93 FY94 FY95 FY96 FY97 FY98
Appraisal estimate 25.0 65.0 90.0 100.0 106.0
Actual 4.31 19.83 38.09 68.08 85.79 104.25 111.0 111.32
Actual as percent of adjusted 4.1 18.7 35.9 64.2 80.9 98.3 104.9 105.0 estimate
Date of fnal disbursement September 22, 1997
TABLE 4B: LOAN/CREDIT DISBURSEMENT: CUMULATIVE ESTIMATE AND ACTUAL, BY SEMESTER ($ million)
IBRD/IDA At appraisal Actual Actual project Fiscal year Disbursement lProject Disbursement Project cumulative, semester Semestral Cumulative curnulative Semestral Cumulative cumulative compared ($ million) (%) ($ million) (N) with SAR(%)
1989 1st ------2nd - - - - - 1990 Ist 12.00 12.00 11.3 2.16 2.16 1.9 2.0 2nd 13.00 25.00 23.6 2.16 4.31 3.9 4.1 1991 Ist 17.00 42.00 39.6 7.76 12.07 10.8 11.4 2nd 23.00 65.00 61.3 7.76 19.83 17.8 18.7 1992 Ist 12.50 77.50 73.1 9.13 28.96 26.0 27.3 2nd 12.50 90.00 84.9 9.13 38.09 34.2 35.9 1993 Ist 5.00 95.00 89.6 15.00 53.09 47.7 50.1 2nd 5.00 100.00 94.3 15.00 68.08 61.2 64.2 1994 Ist 6.00 106.00 100.0 8.86 76.94 69.1 72.6 2nd 8.86 85.79 77.1 80.9 1995 1st 9.23 95.02 85.4 89.6 2nd 9.23 104.25 93.7 98.3 1996 1st 3.37 107.62 96.7 101.5 2nd 3.37 111.00 99.7 104.7 1997 Ist 0.16 111.16 99.9 104.9 2nd 0.16 111.32 100.0 105.0
Total 106.00 106.00 111.32 111.32 - 16-
TABLE 5: KEY INDICATORS FOR PROJECT IMPLEMENTATION
Estimated % of Key irnplementationindicators Unit At appraisal Midterm Actual completion adjustment
A. DongleiIrrigation Scheme 1. Taili Junction IntakeGates unit/set 8/1 8/1 8/1 100 SedimentGates unit/set 3/1 3/1 3/1 100 2. IPumpStations unit/no. 147/37 147/37 112/37 76-100 TailiLifting Station I pumpunit set 9.00 9.00 9.00 100 BeiganLifting Station 2 pumpunit set 12.00 12.00 2.00 17 XiazhaiLifting Station 3 pumpunit set 10.00 10.00 2.00 20 Xiazhai SmallLifting Station pumpunit set 3.00 3.00 - 0 SunzhenSystem pumpstation no. 7.00 7.00 7.00 100 pumpunit set 36.00 36.00 36.00 100 ]'uchengSystem pumpstation no. 8.00 8.00 8.00 100 pumpunit set 20.00 20.00 20.00 100 XingzhenSystem pump station no. 5.00 5.00 2.00 40 pump unit set 14.00 14.00 - 0 Liuqu System pump station no. 6.00 6.00 6.00 100 pump unit set 26.00 26.00 26.00 100 Liuji System pump station no. 4.00 4.00 4.00 100 pump unit set 9.00 9.00 9.00 100 DuanjiayuanSystem pump station no. 3.00 3.00 3.00 100 pump unit set 8.00 8.00 8.00 100 3. Tunnel Hancun km 1.92 5.12 5.12 100 Lojubzhai km 0.51 0.05 0.05 100 4. ILuoheFlume length km 1.29 1.29 1.29 100 5. Canal length km 597.00 597.00 444.20 74 Main Canal length km 53.50 53.50 53.50 100 North-Canal length km 45.70 45.70 45.70 100 SouthCanal length km 15.80 15.80 - 0 SubmainCanal length km 80.00 80.00 80.00 100 Branch Canal length km 402.00 402.00 265.00 66 6. New IrrigationArea area mu 1,188,800 320,000 26.9 SunzhenScheme area mu 205,000 120,000 58.6 PuchengScheme area mu 163,000 80,000 49.1 XingzhenScheme area mu 181,800 0 0 LiuquiScheme area mu 240,000 80,000 33.3 Duanjiayuan area mu 55,000 40,000 72.7 BeiganGravity Scheme area mu 144,000 0 0 WellIrrigation area mu 200,000 0 0 7. ExistingIrrigation Area area mu 780,000 780,000 100 LuodongScheme area mu 200,000 200,000 100 LuoxiScheme area mu 200,000 200,000 100 Jiaokou Scheme area mu 380,000 380,000 100 8. CivilWorks Taili LiftingStation I building m2 578.00 578.00 578.00 100 BeiganLifting Station 2 building m2 1,334.00 1,334.00 1,334.00 100 XiazhaiLifting Station 3 building m2 1,196.00 1,196.00 1,196.00 100 9. Structures Alongthe Main Canal set 276.00 287.00 287.00 100 Alongthe North Canal set 244.00 244.00 126.00 52 10. Power SupplyLines 110kV Substation building no. 9.00 9.00 9.00 100 35 kV Substation building no. 29.00 29.00 29.00 100 lO0kV Power Line length km 68.60 68.60 55.00 80
B. DingibianWater Supply 1. PumpStation pump station set 4.00 4.00 4.00 100 pump unit set 16.00 20.00 20.00 100 2. Tunnel amount set 2.00 1.00 1.00 100 length km 7.30 5.95 5.95 100 3. Structuresalong the Main Canal tunnel set 3.00 siphon set 5.00 5.00 100 water pond set 4.00 4.00 100 4. Main Pipeline length km 68.90 62.65 62.65 100 5. Water TreatmentPlant capacity tons/day 20,000 20,000 20,000 100 storage tons 120,000 120,000 40,000 33 - 17-
Estimated %of Key implementation indicators Unit At appraisal Midterm Actual completion adjustment
6. Canal common part km 14.00 14.00 100 irrigation km 76.50 76.50 9.00 12 7. Distribution Pipes pipeline no. 10.00 10.00 1.00 10 8. Irrigation Canal lateral canal km 75.60 75.60 42.00 56
C. Aquaculture l. Lined Pond mu 6,000.00 7,000.00 7,000.00 100 2. Unlined Pond mu 26,000 15,500 15,500 100 3. Hatchery mu 350.00 350.00 350.00 100 4. Civil Works building m2 38,467.00 38,467.00 100 5. Dali Pellet Mill capacity tons/day 3,000.00 3,000.00 3,000.00 100 Civil Works building m2 1,500.00 1,500.00 100 6. Heyang Pellet Mill capacity tons/day 3,000.00 3,000.00 3.000.00 100 Civil Works building m2 1,350.00 1,350.00 100 7. Dali Supply Center building, m2 900.00 900.00 1,123.00 125 8. Heyang Supply Center building m2 900.00 900.00 1,020.00 113 9. Xingping Supply Center building m2 900.00 900.00 900.00 too 10. Huayin Supply Center building m2 900.00 900.00 900.00 100 11. Provincial Training Center building m2 2,375.00 2,375.00 2,375.00 100 12. Baiji Training Center building m2 900.00 900.00 900.00 100 13. Weinan Training Center building m2 900.00 900.00 1,150.00 128 14. Provincial Supply Center building m2 3,900.00 3,900.00 3,900.00 100
D. Livestock I. Heyang Egg Poultry Parent Farm productivity 10,000 set 2.00 2.00 2.00 100 Commercial Egg Farm productivity 10,000pcs 15.00 15.00 20.00 133 Feed Processing Plant productivity 10,000 tons 1.20 1.20 2.00 167 Hatchery productivity 10,000 pcs 360.00 360.00 360.00 100 Civil Works building area m2 25,000.00 25,000.00 23,322.00 93 2. Xianyang Egg Poultry Parent Farm productivity 10,000set 2.00 2.00 2.00 100 Commercial Egg Farm productivity 10,000 pcs 20.00 20.00 20.00 100 Feed Processing Plant productivity 10,000 tons Hatchery productivity 10,000 pcs 360.00 360.00 360.00 100 Civil Works building area m2 26,000.00 26,000.00 27,500.00 106 3. Baoji Egg Poultry Parent Farm productivity 10,000 set 2.00 2.00 2.00 100 Commercial Egg Farm productivity 10,000 pcs 20.00 20.00 20.00 100 Feed Processing Plant productivity 10,000 tons Hatchery productivity 10,000 pcs 360.00 360.00 360.00 100 Civil Works building area m2 26,000.00 26,000.00 26,740.00 103 4. Weinan Broiler Farm Parent Farm productivity 10,000 set 2.40 2.40 2.70 113 Commercial Broiler Farm productivity 10,000 pcs 25.00 25.00 - 0 Feed Processing Plant productivity 10,000tons 1.00 1.00 1.00 100 Hatchery productivity 10,000 pcs 300.00 300.00 350.00 117 Slaughter productivity 10,000 pcs 240.00 240.00 240.00 100 Cooling Storage storage capacity tons 200.00 200.00 200.00 100 Civil Works building area m2 21,000.00 21,000.00 21,600.00 103 5. Sanmenkou Broiler Poultry Grandparent Broiler Farm productivity 10,000 set 0.60 0.60 0.60 100 Parent Broiler Farm productivity 10,000 set 1.60 1.60 1.60 100 Hatchery productivity 10,000 pcs 300.00 300.00 360.00 120 Civil Works building area m2 10,500.00 10,500.00 10,500.00 100 6. Provincial Grandparent Farm productivity set/year 3,500.00 3,500.00 6,500.00 186 Hatchery productivity 10,000 pcs 70.00 70.00 70.00 100 Civil Works building area m2 4,500.00 4,500.00 4,587.00 102 7. Xianyang Pig Breeding Farm Basic Sow in Pigsty productivity capita/year 250.00 250.00 350.00 140 Commercial Pig Sold productivity capita/year 3,600.00 3,600.00 5,000.00 139 Civil Works building area m2 12,200.00 12,200.00 15,038.00 123 8. Rabbit Breeding productivity capita/year 500.00 500.00 500.00 100 Annual Production productivity capita/year 3,500.00 3,500.00 3,500.00 100 Civil Works building area m2 2,080.00 2,080.00 2,080.00 100 - 18-
Estimated % of Key iimplementation indicators Unit At appraisal Midterm Actual completion adjustment
E. Seed Processing Plant Equipment productivity tons/year 20,000.00 20,000.00 20,000.00 100 Civil Works buildingarea m2 29,081.00 29,081.00 31,500.00 108 1. Yangling Seed Processing Plant productivity tons/year 2,000.00 2,000.00 2,000.00 100 Equipment set set 1.00 1.00 1.00 100 Civil Works building area m2 3,200.00 3,200.00 3,500.00 109 2. Baoji Seed Processing Plant productivity tons/year 2,000.00 2,000.00 2,000.00 100 Equipment set set 1.00 1.00 1.00 100 Civil Works building area m2 5,965.00 5,965.00 6,400.00 107 3. Xi'an Seed Processing Plant productivity tons/year 2,000.00 2,000.00 2,000.00 100 Equipment set set 1.00 1.00 1.00 100 Civil Works building area m2 2,967.00 2,967.00 3,140.00 106 4. Pucheng Seed Processing Plant productivity tons/year 2,000.00 2,000.00 2,000.00 100 Equipment set set 1.00 1.00 1.00 100 Civil Works building area m2 1,701.00 1,701.00 1,870.00 110 5. Yongshou Seed Base land area mu 20,000.00 20,000.00 20,000.00 100 Equipment set set 1.00 1.00 1.00 100 Productivity productivity tons/year 2,000.00 2,000.00 2,000.00 100 Civil Works building area m2 2,341.00 2,341.00 2,950.00 126 6. Longxian Seed Base land area mu 50,000.00 50,000.00 50,000.00 100 Equipment set set 1.00 1.00 1.00 100 Productivity productivity tons/year 2,000.00 2,000.00 2,000.00 100 Civil Works building area m2 5,005.00 5,005.00 5,460.00 109 7. Heyang Seed Base land area mu 20,000.00 20,000.00 20,000.00 100 Equipment set set 1.00 1.00 1.00 100 Productivity productivity tons/year 2,000.00 2,000.00 2,000.00 100 Civil Works building area m2 3,139.00 3,139.00 3,337.00 106 8. Yaoxian Seed Base land area mu 20,000.00 20,000.00 20,000.00 100 Equipment set set 1.00 1.00 1.00 100 Productivity productivity tons/year 2,000.00 2,000.00 2,000.00 100 Civil Works building area m2 1,530.00 1,530.00 1,530.00 100 9. Luochuan Seed Base land area mu 20,000.00 20,000.00 20,000.00 100 Equipment set set 1.00 1.00 1.00 100 Productivity productivity tons/year 2,000.00 2,000.00 2,000.00 100 Civil Works building area m2 2,133.00 2,133.00 2,325.00 109 10. Provincial Seed Inspection Center capacity 1,000.00 1,000.00 1,000.00 100 Sampling no. no. Civil Works building area m2 1,100.00 1,100.00 1,000.00 91
F. Agroproduction Processing Plant 1. Bee Product Processing Plant productivity tons/year 400.00 400.00 400.00 100 Tablet Products productivity 1 million/year - 1.00 1.00 100 Injection Products productivity 10,000/year - 2,000.00 2,000.00 100 Tincture Products productivity liters/year - 12,000.00 12,000.00 100 Oral Taking Liquid Medicine productivity 10,000boxes - 80.00 80.00 100 Medicine, taking after mixing with productivity 10,000bottle - 50.00 50.00 100 water Capsule Products productivity 10,00Opcs - 42.00 42.00 100 Civil Works building area m2 8,300.00 8,300.00 8,500.00 102 2. Fruit Processing Plant productivity tons/year 400.00 400.00 400.00 100 Civil Works building area m2 20,333.00 20,333.00 21,732.00 107 Cooling Storage productivity tons 2,100.00 2,100.00 2,100.00 100 3. Cow Slaughter productivity capita/year 12,000.00 12,000.00 12,000.00 100 Cooling Storage productivity tons 120.00 120.00 120.00 100 Civil Works building area m2 5,640.00 5,640.00 5,640.00 100 - 19-
TABLE 6: KEY INDICATORSFOR PROJECT OPERATIONS
Key operation indicatorsin SAR or present report Unit SAR ICR estimate estimates
Donglei Irrigation
Incremental cropping intensity (at full development), partially % 20 32 irrigatedand rain-fed area
Incremental irrigated area '000 ha 103.24 125.20 New area '000 ha 93.00 113.00 Existing upgrading '000 ha 10.24 12.20
Incrementalproduction, at full developmznt Grain '000 tons 280.0.00 376.80 Cotton '000 tons 5.00 15.00 Cash crops (vegetables,apples, rapseed, etc) '000 tons 182,00 515.00
Incremental farm income, at full develop]ment I household model (grain farmers) 5:5% yuan 3,400 3,690 2 households model (Cotton farmers) 30% yuan 4,600 4,730 3 households model (Cashcrop& Orchards) 15% yuan 7,890 9,300
Dingbian Irrigation
Incremental cropping intensity % 0.0 32.4
Incremental irrigated area For grain ha 667 1007 For alfalfa ha 3140 3140 For apple ha 134 180 For herb ha 267 367
Incremental production Grain tons 1,881 2,315 Alfalfa kg 19,665 22,176
Incrementalfarm income, at full developmrnent I householdmodel (grain and livestock)85% yuan 8,090 3,750 2 householdmodel(cashmere,herbs and some grain) 15% yuan 10,764 10,550
Aquaculture (Actual, 1997)
New ponds area ha 2,100 1,500 Production ponds ha 1,680 1,050 Nursery ponds ha 420 450
Production of fish tons 9,600 8,655 Yield per hectare tons 4.57 5.77 Income of farms (average) yuan 2,110 4,000 - 20-
Key operation indicatorsin SAR or present report Unit SAR ICR estimate estimates
Livestock (Actual)
Layer chickens Grandparent chickens gp.birds 245, 485 Commercial layer million birds 6.0 2.3 Breeding eggs million 0/a 7.3
Broilerchickens Grandparent chickens gp.birds 6,000 0 Parent broiler birds 40,000 26,000 Breeding chickens million birds 6.0 1.2 Breeding eggs million 0/a 2.0
Seed Production and Processing ICR estimates
Seed farm ha 10,500 10,900 Seed companies no. 9 9 Seed production in 1998 tons 22,950 55,000/a Seed production in 2000 tons 22,950 115,000/ b
/a The number of eggs to be produced was estimated as breeding chickens instead of breeding eggs. /b Additional seed growers are included. - 21 -
TABLE 7: STUDIES INCLUDEDIN PROJECT
Study Purposeas definedat appraisalor Status Impactof study redefined
Foundation Bearing (a) To identifythe foundation'sbear- Startedin The experimentprovided the Capability of the ingcapability of thejunction. Marchand basisfor the foundationdesign Junctionat Intake of (b) To check the capabilityof the completedin of thepump station. DongleiPump Station foundationon earthquakeresis- April 1991 tance.
The MaximumCapa- To verifythe sedimentdelivery capa- Startedin Theexperiment proved that 50 city on Sediment cityof the waterflow along the canal. June 1992 percentof sandwill be depos- Deliveryof the Canal In orderto depositthe coarsesand in and ited in the sedimentpool or the sedimentpounds and transportthe completedin canal.The designis basedon fine sandto the field,the test was to December the following:(a) the maxi- define (a) the maximnumsediment 1994 mum sediment content in contentin pumpedwater and (b) the pumped water shall not quantityof sandto be depositedin the exceed70 kg per m3 of water; sedimentcanal. (b) the design sedimentcon- tent along the canal is defined as 10-20 kg per m3 of water; 3 and (c) totally, 4.34 million m of sand will be settled along the canal at an annual water discharge of 430 million mi3 .
Model Test on Releas-(a) To definethe releasingcapacity of Startedin The tests providedthe basic ing Structures at the releasing structures,with a July 1990 data for the design of the Dangjiachuan and scaleof 1:20. and structures. Hancun (b) To definethe diameterand capa- completedin city of siphon, with a scale of 1:10. December (c) To verifythe releasingcapacity of 1990 Hancun ReleasingGate, with a scaleof 1:20.
To replace the tradi- To reducethe feed cost and increase Completed This method had been pro- tional fish feed with thebenefit. in 1993 moted throughoutthe prov- yeast ince. Annually,400 tons of fish feed (Y 800,000.00)can be saved. - 22 -
TABLE 8A: PROJECT COSTS IN YUAN (Yuan million)
Estimated at appraisal Actual or latest estimate No. Project description Local Foreign Total Local Foreign Total
I. Donglei Irrigation 234.58 172.76 407.34 1,005.06 404.63 1,409.69 II. Dingbian Water Supply 59.29 43.89 103.17 157.38 108.63 266.01 III. Aquaculture 76.17 14.57 90.73 54.50 69.43 123.93 IV. Agroprocessing 12.86 14.78 27.65 14.53 20.20 34.73 V. Livestock 71.10 32.33 103.43 68.78 82.11 150.89 VI. Seed Production and Processing 9.88 10.85 20.73 41.61 28.29 69.90
Base Cost 463.87 289.18 753.05 1,341.86 713.28 2,055.14
Physical contingencies 27.47 16.82 44.29 Price contingencies 62.05 22.32 84.37
Total Project Cost 553.40 328.32 881.72 1,341.86 713.28 2,055.14
TABLE 8B: PROJECT COSTS IN US DOLLARS ($ million)
Estimated at appraisal Actual or latest estimate No. Project description Local Foreign Total Local Foreign Total
I. Donglei Irrigation 76.53 52.38 128.91 133.26 60.77 194.03 II. Dingbian Water Supply 19.14 13.17 32.31 22.11 15.08 37.19 [II. Aquaculture 24.08 5.21 29.29 10.32 12.38 22.70 IV. Agroprocessing 4.35 4.61 8.97 3.14 3.56 6.70 V. Livestock 21.99 9.92 31.91 11.99 14.40 26.38 VI. Seed Production and Processing 2.99 3.15 6.14 7.88 5.13 13.01
Total Project Cost 149.08 88.45 237.53 188.70 111.32 300.02 - 23 -
TABLE 8C: PROJECT COST INCREASE (%)
Percentage of cost increase comparing with that at appraisal At yuan account At$ account No. Project description Local Foreign Total Local Foreign Total
1. Donglei Irrigation 254 108 195 74 16 51
II. DingbianWaterSupply 121 122 122 15 15 15
III. Aquaculture -39 259 14 -57 138 -22
IV. Agroprocessing -10 18 4 -28 -23 -25
V. Livestock -16 123 27 -45 45 -17
VI. Seed Production and Processing 275 142 207 164 63 112
Total project cost 142 117 133 27 26 26
TABLE 81D:PROJECT FINANCING ($ million)
Estimated at appraisal Actual or latest estimate Project Description Local Foreign Total Local Foreign Total
IDA 17.6 88.4 106.0 56.7 54.7 111.3
Central government 18.0 - 18.0 15.9 - 15.9
Provincial government 46.5 - 46.5 121.9 - 121.9
County, enterprises, etc. 61.7 - 61.7 32.5 - 32.5
Agriculture Bank of China 5.3 - 5.3 18.3 - 18.3
Total 149.1 88.4 237.5 245.4 54.7 300.0 - 24 -
TABLE 9: ECONOMIC COSTS AND BENEFITS (Y million)
Appraisal estimate Actual estimate Entity FIRR/a NPV/b EIRRIc FIRR/a NPV/b EIRR/c
Livestock 15.6 26.8 13.2 16.7
Sanmenkou GPS 17.0 3.2 26.0 18.0 3.4 23.0 Broiler Chicken Farm 17.0 9.1 22.0 15.0 4.4 18.0 ParentLayerFarm ] 15.0 56.3 27.0 16.0 7.1 21.0 Commercial Layer Farm ] 8.0 -7.6 10.0 XiniyangBreed Pig Farm 19.0 5.7 33.0 16.0 3.1 21.0 Rabbit Farmn 15.0 0.7 24.0 6.0 -0.3 7.0
Agroprocessing 20.5 24.5
Fruitprocessingplant 23.0 15.3 30.0 21.0 26.0 25.0 Honey product plant 20.0 6.6 28.0 20.0 33.3 24.0 Meat processing plant 9.0 4.8 21.0 0.0 0.0 0.0
Aquaculture 20.0 83.9 32.0 25.3 29.1
Lined ponds (6,000 mu at appraisal, 18.0 9.3 22.0 26.0 14.8 35.0 increased to 6,920 mu) Unlined ponds (26,000 mu at appraisal, 28.0 64.3 34.0 24.0 24.0 33.0 increased to 15,580 mu) Feed mills 28.0 7.5 49.0 29.0 1.1 40.0 Hatchery (125 mu) 20.0 1.3 23.0 28.0 0.1 18.7 Hatchery (50 mu) 15.0 0.1 23.0 19.5 0.6 18.6
Seed Production and Processing 16.0 6.1/d 54.0 17.0 13.3/d 22.0
Irrigation and Water Supply 19.3 19.5
Donglei Irrigation 20.0 23.0 Dingbian Water Supply 13.0 14.2
Overall EIRR 23.9 20.0
/a FIRR = Financial internal rate of return. /b NPV = Net present value discounted at 12 percent /c EIRR = Economic internal rate of return. /d The NPV doubles due doubling of net cash flow due to doubling of output prices and costs. - 25 -
TABLE 10: STATUS OF LEGAL COVENANTS
Original Revised Covenant Present fulfillment fulfillment Agreement Section type status date date Descriptionof covenant Comments Project 2.05 05 C PMOto maintainsufficient Compliedwith -numbersof staff with previously qualificationssatisfactory to IDA.PMO is to be headedby LeadingDeputy Director from the WaterConservancy Bureau who is responsiblefor day-to-day managementof projectactivities. 3.02 (a) 02 C 01/01,11997 Water chargesto be set and They are in the adjustedas necessaryto cover processof setting full operationsand maintenance the water charges (O&M)and part of capital costs,for schemesassisted under the project. 3.02 (b) 02 C 12/31/1991 01/30/94 Watercharge action plan to be Compliedwith fumishedto IDA. Schedule2, 06 C Projectactivities to comply Compliedwith for Para.1(a) with environmentalcontrol all aspectsof the standardsacceptable to IDA. projects Schedule2, 06 C 12/01/1993 Establishand maintainsystem Compliedwith Para.l (b) to monitoreffluents for project essentially agroprocessingactivities. Schedule2, 06 Soon 12/0111993 Monitorwater qualityon canals Willbe monitored Para.1(c) and pipes of Dongleiand aftercanal flows Dingbian,and fumishreport to are established IDA by specifieddate. Schedule2, 13 C Ensurethat adequatefertilizer is Compliedwith Para.2(a) availableto project farmers,and fromthe startof provideto IDA an annual the project programfor fertilizersby DecemberI of each year. Schedule2, 11 C Provideto IDA an annual Compliedwith Para.2 (b) programfor fertilizersupply by DecemberI of eachyear. Schedule2, 10 C 12/01/1991 Ensurethat poultrydevelopment Compliedwith Para.3(a) programunder the projectis aftersome completed. adjustmentbased on the market situation Schedule2, 11 CD 12/01/1991 Consultwith IDA about Phases Compliedwith Para.3(b) 11and III of poultrydevelopment afterdelay program.
CovenantClass: Status: I= Accounts/audits 8 = Indigenouspeople C = Covenantcomplied with 2 = Financialperformance/revenue 9 = Monitoring,review, and reporting CD = Compliedwith after delay generationfrom beneficiaries 10 = Projectimplementation not CP = Compliedwith partially 3 = Flow and utilizationof project coveredby categories1-9 funds 11 = Sectoralcr cross-sectoral 4 = Counterpartfunding budgetaryor otherresources 5 = Managementaspects of the allocation projector executingagency 12 = Sectoralor cross-sectoralpolicy/ 6 = Environmentalcovenants regulatory/institutionalaction 7 = Involuntaryresettlement 13 =Other - 26 -
TABLE 11: COMPLIANCE WITH OPERATIONAL MANUAL STATEMENTS There was no significant lack of compliance with an applicable Bank Group Operational Manual Statement [Operational Directive (OD)].
TABLE 12: BANK GROUP RESOURCES: STAFF INPUTS
Stage of Planned Revised Actual project cycle Weeks $'000 Weeks $'000 Weeks $'000
Preparation to appraisal n.a. n.a. n.a. n.a. 106.475 187.869 Appraisal n.a. n.a. n.a. n.a. 61.975 120.228 Negotiations to Board n.a. n.a. n.a. n.a. 7.3 15.898 Supervision n.a. n.a. 50.5 173.990 162.275 430.242 Completion n.a. n.a. n.a. n.a. 7.0 40.4
Total n.a. n.a. 50.5 173.990 345.025 794.637
n.a. = Not available.
TABLE 13: BANK GROUP RESOURCES: MISSIONS
Stageof Month/ Number Days Specialized Performancerating Typesof projectcycle year of persons in field staffskills represented/a Impl.status/b Dev.objectives problems/c
Identification 09/87 2 7 FTM,FA Preparation 11/87 6 21 FTM, AE, AS, APS, PS Appraisal 06/88 6 28 FTM, AE, AS, APS, PS Supervision 1 10/89 2 12 FTM, LS I I - Supervision 2 04/90 3 15 FTM, PS, PMS 3 1 - Supervision 3 10/90 4 15 FTM, LS, PS, AS 2 1 - Supervision4 11/91 4 12 FTM,AE 2 1 - Supervision 5 04/92 4 11 FTM, IE, EO, PS 4 2 Supervision 6 10/92 6 24 TM, CE, AE, IE, PS, AS 2 2 Supervision 7 04/93 4 10 TM, CE, IE, AS 2 2. Supervision8 11/93 2 10 TM,CE 2 2 Supervision 9 04/94 3 9 TM, AS I 2 Supervision 10 05/95 3 7 TM, CE, AS S S Supervision 11 01/96 5 10 TM, APS, IE, CE, LS S S - Supervision 12 09/96 3 6 TM, APS, CE U U - Supervision 13 03/97 2 7 TM, CE HU U - Completion 11/97 5 11 TM, EO, IE, PS, FA U U -
/a TM: Task Manager; FTM: Former Task Manager; LS: Livestock Specialist; PMS: Project Monitoring Specialist; AS: Aquaculture Specialist; IE: Irrigation Engineer; AE: Agricultural Economist; EO: Economist; CE: Construction Engineer; APS: Agroprocessing Specialist; ID: Institutional Development; PS: Procurement Specialist; FA: Financial Analyst. lb 1: Highly satisfactory; 2: Satisfactory.; S: Satisfactory; U: Unsatisfactory; HU: Highly unsatisfactory. /c Typical problems included: implementation delays and shortage of counterpart funds. - 27- ANNEXA
ANNEX A: ICR MISSION'S AIDE MEMOIRE
1. A mission consisting of Daniel Gunaratnam (Mission Leader), Jiang Ping (Irrigation/Institutional Specialist), Hu Shunong (Procurement/Cost Engineer), Zhang Chaohua (Socioeconomist/Resettlement Specialist), and Wang Xiaolan (Financial Analyst) visited Xian (Shaanxi Province) and Dali, Heyang, Pucheng, Fupeng, and Dingbian Project County areas November 6-18, 1997. The mission's main focus was to review the completion of the above caption project. The mission would like to thank all the concerned officials of the Shaanxi Government, Project Management Office, and county officials for the courtesies offered to the mission during its stay in Shaanxi. The mission's findings and recommendations are indicated below.
Status of Implementation, Project Changes, and Quality of Works
2. Almost all the smaller components, such as the Aquaculture, Agroprocessing, Livestock, and Seed Production and Processing, have been completed. However, Donglei Irrigation and Dingbian Water Supply Components have not been completed. Processing of future operations to this province under the Rural Development and Natural Resources Sector Unit of the East Asia and Pacific Regional Office (EASRD) of the World Bank will be linked to the successful completion of this project.
3. Donglei Irrigation Component. Thirty-six out of the 37 pumping stations have been completed. The Beigan and Xiazhai stations are almost completed but the high head pump casings are cracked and the impellers are chipped. The 20 high head pumps for the two stations will have to be completely replaced as soon as possible even if the present pumps perform for the time being. The performance bond of China Machinery Corporation will have to be forfeited since they do not seem to act responsibly after obtaining the contract.
4. There are 444 km main and branch canals (73 percent) out of the 597 km of canals completed. The entire canal systems should be completed before 1998. The canals that need greatest attention are the South Canal (15.8 km) and the branch canals (402 km, of which 265 km have been constructed).
5. The Donglei Irrigation area is now composed of the following areas:
New Irrigation Area 11,065,000 inu (71,000 ha)] (a) Sunzhen 205,000 mu (120,000 mu completed) (b) Pucheng 163,000 mu (80,000 mu completed) (c) Xingzhen 181,800 mu (none completed) (d) Luiqui 240,000 mu (80,000 mu completed) (e) Duanjiayuan 55,000 mu (40,000 mu completed) - 28 - ANNEX A
(f) Beigan Gravity 144,000 mu (none completed) (g) Well Irrigation 200,000 mu (none completed) Total (new) 1,065,000 mu
Existing Irrigation Area (780,000 mu (53,000 ha)) (a) Luodong 200,000 mu (all works completed) (b) Luoxi 200,000 mu (all works completed) (c) Jiaokou 380,000 mu (all works completed) Total (existing) 780,000 mu
6. The on-farm works have been completed for 320,000 mu (30 percent). There is an immediate need to complete all 1,065,000 mu of on-farm works. The PMO and county governrnents have assured the mission that they will mobilize the farmers to complete all the on-farm works by March 15, 1999.
7. Funding for the Donglei Irrigation Component is about Y 300 million, which has been allocated for FY 1998 to ensure that all works are completed. The Shaanxi Government has reaffirmed that it is committed to completing all the works by FY 1998, and initial operation of 50 percent of the area will have to start by June 1998 for summer irrigation.
8. Dingbian Water Supply. This component is also incomplete, although the quality of works to date is satisfactory. Up until August 1997, 63,000 underground water storage tanks had been constructed with a total storage capacity of 1.02 million m3 . Although the main pumping works and the main supply line have been completed, the 9 branch water supply lines, branch and lateral irrigation canals (67.5 km) for 69,000 mu irrigated area and the clear water storage of an addition 80,000 m3 for drink water supply are still incomplete. The mission strongly feels that the water storage tanks cannot be delayed, since they are crucial for the operation of the water system for winter. The water treatment plant for Dingbian town has been completed, but it needs to be commissioned.
9. The following funds need to be allocated for construction of the works mentioned above:
(a) Water supply network 9 branch pipelines Y 11 million (b) Irrigation pipes and canals Y 5 million (c) Water Storage tanks 2 x 40,000 rn3 Y 31 million
Total allocation to complete the works is about Y 47 million, which is in the 1998 budget.
10. The planning for agriculture and livestock development was not clear. With the separation of the Animal Husbandry Bureau from the Agriculture Bureau, the Agriculture Bureau has developed a cropping pattern that substantially reduces the alfalfa areas. However, with the large animal population, a significant development area for alfalfa is needed. Presently the cropped area is about 4,700 ha, mainly under grain crops (i.e., wheat 1,380 ha, millet 1,843). There is no area where alfalfa is grown presently. The plan - 29 - ANNEX A during the appraisal was for 667 ha maize; 268 ha under vegetables and melon; 3,140 ha for alfalfa, 134 ha for apples; and 267 ha for medicinal herbs. This plan should be maintained, since there is a large animal population, which needs fodder. For the other areas, high-value crops (vegetables, melons, and medicinal plants) should be grown. The PMO reaffirmed that it will essentially keep the cropping patterns as appraised.
11. Aquaculture. The mission had discussions with the project officers in the province and visited the fishery ponds. The mission wants to congratulate the project officers on the job well done in their key role in managing 57 project farms. In the past years, this subproject has made consistent progress in increasing production and implementing the recommendations from the Bank Group's supervision missions.
12. Some investment adjustments were made in October 1990 for the following reasons: (a) The project area was reduced, since the Government had to allocate the land to the 30,000 resettlers moving back from Sanmenxia reservoir. (b) With the rapidly increased input price such as the agriculture raw material and the fingerlings, the government wanted to be more conservative about the project scale. (c) The slow bidding process for the construction delayed the progress of this project. As a result, the total investment for this subproject was reduced from Y 108,738,000 to Y 96,190,000 while the World Bank's loan still remained at $12,630,000.
13. The project provides equipment for pond management, strengthens the support facilities for production and marketing of fish, and serves as a model for the establishment of commercial fish farms in other parts of the province.
14. All procurement and civil works were completed by December 31, 1996. This subproject has built up 45 fish farms, 1,500 ha of fishery ponds 2 provincial-level hatcheries, 2 feed mills with a production capacity of 3,000 tons/year, 3 technical training centers, and 7 market centers.
15. Up to the end of 1996, the total investment for this subproject was Y 119,170,000, which is 124 percent of the adjusted investment amount of 1990. The main reason for the cost overruns is increases in the market prices of the construction materials used by the government since 1990s. All the planned aquaculture facilities have been put into operation. The total amount of commercial fish produced in the project area is 8,655 tons, which is 11 percent higher than the projected output. The overall output value from this subproject is Y 81.0 million, which is 29.3 percent of the total output of the province. The aggregate profit since operations has reached Y 59.1 million.
16. The government has performed well in terms of implementation of some preferential policies and providing management and technical training to the staff involved in this subproject. The Shaanxi Provincial Government put forth a decision to postpone levying the Special Production Tax on the fish farmers in the project area to motivate the farmers. The provincial project office has organized and published several documents, including the "Construction Management Method" and "Fish Farm Management Measurement." to help the fish farms standardize their management and - 30- ANNEX A operations. Fifteen staff selected from the project offices have been sent to Thailand to study fishery operation management and technology advancement. The Project Management Office has conducted 12 training sessions for the farm managers and technical staff, and more than 500 staff have been received the related training. The Provincial Project Office also conducted the market forecast, and the result shows that the dernand for the fishery market toward the year 2000 will be 100,000-200,000 tons.
17. This subproject has provided more than 6,000 job opportunities, 40 percent for women. As a result, the average income for each farmer in the project area has reached Y 4,000 per capita per year, compared with the average income in most aquaculture farms of less than Y 2,000 per capita per year.
18. During the discussion, the mission agreed with the PMO that the lack of timely working capital is one of the major constraints to this subproject. The PMO recommended that the working capital be included in the cost of the overall planning process. The mission also agreed with the PMO that it would be much more beneficial, for the sake of continuity, to keep the key on-site chief of the 57 farms on staff to achieve the smooth implementation of the project.
Seed Production and Processing Component
19. The component started implementation in 1990 and was completed by the end of 1993, two years later than scheduled in the appraisal. The project completed 4 seed processing plants, set up 5 seed production bases with seed processing workshops, and 1 provincial seed inspection center. The ten seed companies completed 47,143 m2 of buildings, 108 percent of the appraised target. Equipment and materials were procured as appraised, including nine sets of seed testing and processing equipment, and fertilizer and pesticides. The seed growing area was expanded to 10,900 ha under the ten seed companies. The actual processing capacity of all seed companies has exceeded the design standards of 20,000 tons per seed company. The completed investment is Y 33.16 million, about 145 percent of the appraised Y 22.83 million.
20. The ten seed companies have all exceeded the designed production capacity. The ten seed companies were put into operation in 1994. Seed-growing area was expanded to 157,000 mu (10,900 ha) including 30,000 mu for wheat seed, 1]20,000mu for corn seeds and 7,000 mu for vegetable seeds. Due to a heavy drought in 1994, the average annual seed production per seed company was 9,000 tons, reaching only 45 percent of the designed capacity. The year 1995 saw an increase in seed processing to 15,000 tons, reaching 75 percent of the designed capacity and all companies have now reached or exceeded the designed production capacity of 20,000 tons per seed company.
21. The completed Seed Production and Processing Component has served as a demonstration in seed multiplication and has promoted seed production in Shaanxi Province. Shaanxi Province has developed seed multiplication and supply program to proimote the use of high yielding seeds. It is expected that the wheat area to be covered under this program would reach 50 percent within the project area in 1998 and 80 percent - 31- ANNEX A in 2000, when the seed supply demand reaches 90,000 tons and 144,000 tons, respectively. The coating rate would be over 90 percent of the supplied seeds.
Livestock Development
22. The mission had discussions with the provincial project officer and visited Grandparent Stock (GPS) Farm and SanmnenkouPS Chicken Farm. Overall, most of the components under this subproject are performing well with full capacity operation in 1997. Especially with the advanced imported equipment and scientific design technology, these farms have become the model for the livestock industry in the province. There are eight subcomponents under this subproject. Construction of the Xianyang Pig Farm and Chunhua Rabbit Farm was finished in December of 1993, and operations began in 1994. Construction of GPS Farm; Xianyang, Heyang and Baoji Layer Farms; and Sanmenkou and Weinan Broiler Farms were completed in December 1994 and operations began in 1995.
23. The GPS Farm has been operating very successfully and, compared with that of the average farm in Shaanxi Province, its mortality rate is 2 percent lower, while its hatching rate is 6 percent higher. In 1997, it provided 438,000 pairs of parent layer chickens, 360,000 layer egg chickens, and 18.1 tons of commercial eggs. The total sales revenue was Y 5.863 million, and the net profit was Y 1,699 million for 1997. The chief of this farm is very enterprising and has set up a series of management rules to be implemented strictly. This GPS Farm has been adopting a very aggressive market strategy since early 1996, and 40 percent of its sales are outside the province.
24. The parent layer stock farm, including Xianyang, Heyang and Baoji Farms, are performing well. The three farms produced 60,000 pairs of parent stock (PS) eggs this year. Compared with that of the average market in the province, its mortality rate is 4 percent lower and the hatching rate is 8 percent higher. They sold 2.31 million breed chickens, 7.28 million breed eggs, and 178 tons commercial eggs in 1997. The total sales revenue was $4.75 million, and the net profit was Y 2.919 million. Fifty percent of its product are sold to Xinjiang, Yunnan, and Hainan provinces, and its products have gained quite a good reputation.
25. Sanmenkou Broiler Farm was designed to have two subcomponents: 6,000 pairs of GPS and 16,000 pairs of PS broiler chickens. Due to the lack of necessary technical staff and the limited market of GPS in Shaanxi Province, Sanmenkou Farm decided to support 26,000 pairs of PS broiler chickens. In 1997, it sold 1.12 million chickens, 2 million breeding eggs, and 53.9 tons of commercial eggs. Its total sales revenue was Y 1.12 million and net profit was Y 99,00).
26. The physical construction of Xianyang Pig Farm was completed at 1993. Two thousand seven hundred and fifty breeding pigs and 2,890 fattening pigs were sold in 1997. The total sales revenue was Y 4.628 million, and the net profit was Y 1.01 million. The Xianyang Pig Farm is a model breeding farm that uses advanced breeding techniques, and its breeding pigs are in great demand. - 32 - ANNEX A
27. The mission was informed that various steps are being taken to liberalize the ownership of these enterprises in order to meet the requirements of the market. The mission suggested that the PMO organize more training courses for the managers anid finance staff of these enterprises to enforce their operational and financial management skills. The Mission was also assured that the Shaanxi Government would take specific measures to guarantee the enterprises lines of credit to improve their cash flow.
Agroprocessing Component
28. There are three agroprocessing plants under this subproject. Both the Fruit Processing Plant and the Bee Products Plant have been operating well. The physical construction of the Pucheng Slaughterhouse was completed in December 1994. Because of the lack of working capital, this plant has been shut since March 1995, although it tried to reopen for a couple of months shortly thereafter.
29. The Fruit Processing Plant has plenty of supply of apples, since apple production in Shaanxi has been plentiful, despite the increasing local demand for fresh apples. Meanwhile, the equipment purchased through ICB provides comparative advantages over local plants. Up to the end of 1996, the accumulated profit from the cold storage was Y 4.2 million. In 1996, the juice processing line produced 2,200 tons of juice. Sales revenues reached Y 27 million and yielded a net profit of Y 7 million. The projected production capacity for 1997 is 2,500 tons, and the sales revenues will be more than Y 28 million.
30. This plant has been actively exploring joint venture opportunities and has benefited from the close cooperation with the Hongkong Oriental Pacific Corporation. Currently, plant is negotiating with Xi'an Haixing Group, the largest soft drink producer in Shaanxi Province, to form a joint venture. It is predicted that with this joint venture, the sales market will be dramatically increased for the Fruit Processing Plant.
31. This plant is the first kind in Shaanxi Province, and it sets a good example for other enterprises to follow. Since its operation, this plant has directly created an economic benefit for the fruit farm of Y 150 million and for retail farmers Y 5 million. As a result, the farmers have been motivated to plant better varieties of apples and increase their income.
32. The Bee Products Plant started operations in March of 1993. Up to now, the six processing lines have met the design requirement, and some of its products have been rewarded by the national level. In 1996, its sales revenue reached more than Y 10 million and gained a net profit of more than Y 1.9 million. Currently, this plant is trying to solve the problem of shortages of working capital by reducing its stored inventory, adjusting its market strategy, and negotiating with two firms to inject more investment.
33. The Pucheng Slaughterhouse ceased operation in March of 1995 because of the lack of working capital. The mission has expressed its deep concern to the government. - 33 - ANNEX A
The vice governor in charge of agriculture assured the IDA mission that the government would look into this issue seriously and assured that adequate working capital would be made available to resume the operation of the plant.
Project Costs and Comparison with SA]RCosts
34. Costs. As a result of more than four years' delay of the project, the total project costs went up to $300 million-$62.5 million or 26 percent higher than what was estimated at appraisal (Table 1). The costs of some individual components even dropped by 17 percent because the components were completed during the first two or three years and the costs were shifted, agreed by the Bank Group at interim adjustment, from local to foreign. Such increases in project costs were mainly caused by the following:
(a) significant delays in the project due to the shortage and late allocation of local counterpart funds, slow construction progress of major structures, as the design changed, and slow procurement process of materials and equipment; and
(b) the project extended across a period of very high inflation, during which inflation climbed to over 23 percent in 1993 and 1994, which made things even worse.
TABLE 1: P?ROJECTCOSTS ($ million)
Appraisalestimates Actual costs No. Project component Local Foreign Total Local Foreign Total
I. Donglei Irrigation 76.53 52.38 128.91 133.26 60.77 194.03 II. Dingbian Water Supply 19.14 13.17 32.31 22.11 15.08 37.19 III. Aquaculture 24.08 5.21 29.29 10.32 12.38 22.70 IV. Agroprocessing 4.35 4.61 8.97 3.14 3.56 6.70 V. Livestock 21.99 9.92 31.91 11.99 14.40 26.38 VI. Seed Productionand Processing 2.99 3.15 6.14 7.88 5.13 13.01
Total 149.1)8 88.45 237.53 188.70 111.32 300.02
35. Shifting the project costs forward to the later years resulted in an increase of about Y 600 million (or $74 million in equivalent) in local currency and about $9.20 million in foreign currency requirements, compared with revised estimated costs using (a) the original estimated base cost at the appraisal, (b) 12.5 percent physical contingencies for the Donglei Irrigation Component and 10 percent physical contingencies for other project components, and (c) actual inflation rates during the project years. - 34 - ANNEX A
36. The actual costs for study tours, training, and consultants took only about 12 percent of those estimated at appraisal, while that for researches took about 45 percent, since such components were not fully implemented. As happened in other small projects, the implementation agency tended to expend more on the hardware rather than on the software.
Procurement and Disbursements
37. In spite of the delay of the overall project, the procurements of civil works and equipment have been acceptable, except for the procurement of big pumps for Pump Station Nos. 2 and 3 of Donglei Irrigation Scheme. The Bank Group Procurement Guidelines were basically followed. The preparation of ICB bidding documents, bid invitations, evaluation, and contract awarding were carried out, in cooperation with the PMO, by International Tendering Company of China National Technology Import & Export Corporation (ITC). Pump and motor units, processing plants, construction equipment, and materials, under 67 contracts and with the value of about $56.0 million, were procured through ICB procedures, while all civil works, such as pump stations, water treatment plant, and tunnels, concrete pipes, and main structures along the canal, were procured through National Competitive Bidding (NCB) procedures and the rest through other procedures.
38. Nevertheless, the procurement of big pumps for Pump Stations 2 and 3 should be a good lesson. At the beginning, the Bank Group insisted on procuring the pumps through ICB, since the local manufacturers lacked the expertise to fabricate such a big pump. The government finally agreed to procure the pumps through ICB, but during the bid evaluation, the implementation agent insisted on awarding the contract to a local trading company that is the agent of Changsha Industrial Pump Works. In fact, Changsha Industrial Pump Works is not a qualified manufacturer for pumps of such size, and it sublets the works to other manufactures in different components: the motors to Shenyang Dongfang Motor Works, the impellers to Shijiazhuang Machinery Works, and the casings to a small factory in Changsha. Such subletting caused serious reductions in payment made to the real suppliers, as did the lack of communication between the real buyer and seller. Finally, when the pumps were delivered to the site, it was found that all the pumps were in very poor condition and could not be operated. Two out of 24 pumps were installed in Pump Station 2 and were found leaking seriously during the test run. These impellers and pumps are being replaced and repaired.
39. Through the discussions with PMO, it was found that the issues related to the procurement were: (a) the PMO was somehow forced or misled to procure local goods through trading companies that increased the costs by 5-8 percent; (b) for local suppliers, the contracts were signed between the ITC and the local trading company, which acted as the agent of the real supplier, and for such a contract the PMO was unable to retain the performance bond from the suppliers when the goods failed to meet the technical specifications; and (c) bidding documents were poorly prepared and did not meet -35 - ANNEX A international standards, as some of contracts did not have clear delivery, price, and payment terms.
40. Therefore, for the future NCB procurement, it is suggested that the project implementation agencies be authorized, to procure the works and goods directly. Furthermore, the local administrative organizations should not interfere with the procedures of the procurement. For example, the design and procurement of Luohe Flume were seriously delayed because of such interference.
41. Quality. Basically, the quality of the civil works and goods procured umder the project is acceptable, except for the quality of the pumps for second and third stage pump stations. The mission visited the Donglei Irrigation and Dingbian Water Supply schemes. In general, the civil works are up to standards, except that the concrete quality of some main structures should be improved.
Disbursements
42. Disbursements were very slow in the first few years because of the slow implementation. The disbursement lag was about 80 percent. The disbursement lag was reduced 27 percent by the forth year. The SAR forecast that the entire loan was to be disbursed by 1994, five years from the start of the project; these forecasts were very optimistic. About 80 percent of the loan was disbursed within five years and 98.5 percent by the sixth year. Overall credit disbursement performance was not too bad.
Project Charges and Financial Arrangements for O&M
43. The PMO had issued a documenl. in 1994 proposing an organizational structure for operations and maintenance, a water distribution plan with rotation for low water conditions, a water dispatch system, and. a proposal for water tariff and fee collection systems. The organizational structure at the on-farm level would essentially be organized as a corporation of farmers who would buy water from the main system irrigation corporation. The farmers would take over not only the on-farm works, but the subbranch as well. The 1994 proposal for on-farm water management has been superseded by new developments, and the PMO informed the Bank Group Mission that there were several options in managing the on-farm works. The most promising model of on-farm works organization is to sell the assets of the on-farm works and subbranches to farmer groups and for them to sign a concession-type contract with the Donglei Irrigation Corporation. The PMO has already undertaken financial forecasts to determine water charges needed to repay the Bank Group Credit, and pay for power costs, all minor and major repairs, and depreciation. The PMO has assured the Mission that these charges will be discussed with counties, townships, and villages to obtain agreement with all parties concerned. - 36 - ANNEX A
TABLE 2: INCREMENTAL ECONOMIC CASHFLOW, SAR VERSUS ESTIMATED FOR DONGLEI (%)
SAR Estimate /a ICR Estimate /b Year Incremental Incremental Net Incremental Incremental Net Cashflow Cost Benefits Cashflow Cost Benefits
1988 22.4 0.0 -22.4 22.4 -22.4 1989 260.0 0.0 -260.0 35.0 -35.0 1990 192.6 0.0 -192.6 102.0 -102.0 1991 181.0 0.0 -181.0 100.0 -100.0 1992 144.7 0.0 -144.7 191.0 -191.0 1993 77.4 0.0 -77.4 186.0 -186.0 1994 68.7 88.3 19.6 110.0 -110.0 1995 75.8 178.8 103.0 141.0 -141.0 1996 84.6 240.7 156.1 108.0 -108.0 1997 43.8 321.9 278.1 315.0 10.0 -305.0 1998 77.0 413.0 336.0 75.0 -200.0 -275.0 1999 77.0 397.1 320.1 90.0 500.0 410.0 2000 77.0 445.9 368.9 90.0 743.0 653.0 2001 77.0 494.6 417.6 90.0 850.0 760.0 2002 77.0 511.2 434.2 90.0 1252.0 1162.0 2003 77.0 537.2 460.2 110.0 1355.0 1245.0 2004 77.0 583.5 506.5 110.0 1435.0 1325.0 2005 77.0 582.6 505.6 125.0 1492.0 1367.0 2006 77.0 582.6 505.6 125.0 1492.0 1367.0 2007 77.0 582.6 505.6 125.0 1492.0 1367.0 2008 77.0 582.6 505.6 125.0 1492.0 1367.0 2009 77.0 582.6 505.6 125.0 1492.0 1367.0 2010 77.0 582.6 505.6 125.0 1492.0 1367.0 2011 77.0 582.6 505.6 125.0 1492.0 1367.0 2012 77.0 582.6 505.6 125.0 1492.0 1367.0
NPV /c 875.86 1,414.12 538.26 858.29 5,980.16 1,298.22
ERR (%) /d 18 23
Notes Incremental Benefits/e SAR Estimates ICR Estimate Field Crops 57% 30% Cash crops and orchards 42% 65% Animal husbandry 1% 5%
/a Cost and benefits have been adjusted for devaluation of the Yuan from $ 1=Y 3.71 to $ 1=Y 8.30. /b Costs and benefits are valued at end- 1997 yuan. /c NPV is discounted at 12 percent. /d SAR estimate is 19 percent compared to 18 percent after devaluation adjustments are made. /e ICR estimates are based on actual cropping observed in irrigated areas in the project areas. - 37- ANNEX A
TABLE 3: FINANCIAL DATA OF LIVESTOCK AND AGROPROCESSINGENTERPRISES (1 994/95- 1997) (Y'OOO)
1994 1995 1996 1997
Broiler Farms Revenues 567.6 843.2 854.0 Operating Costs Plus Tax 371.8 460.1 469.2 Net Revenues after tax 195.8 383.1 384.8
Pig Farm Revenues 125.7 175.7 267.0 462.8 Operating Costs+tax 104.1 166.3 163.9 217.7 NetRevenuesaftertax 21.6 9.4 103.1 245.1
Commercial Layers Revenues 4,010.4 5,491.2 7,021.5 Operating Costs plus Tax 3,503.0 4,693.6 5,963.0 Net revenues after tax 507.4 797.6 1,058.5
Parent Layer Revenues 1,163.4 1,327.4 1,470.5 Operating Costs Plus Tax 779.1 916.6 963.0 Net revenues after tax 384.3 410.8 507.5
Fruit Juice Plant Revenues 2,356.6 2,744.6 2,744.6 Operating Costs Plus Tax 1,445.0 1,659.4 1,570.8 Net Revenues after tax 911.6 1,085.2 1,173.8
Grandparent Stock (Layer) Revenues 233.5 374.6 586.3 Operating Costs Plus Tax 173.9 258.1 334.2 Net Revenues after tax 59.6 116.5 252.1
Honey Processing Revenues 448.4 1,041.8 1,982.0 Operating Costs Plus Tax 304.5 601.6 1,118.5 Net Revenues after tax 143.9 440.2 863.5
Layer Parent Farm Revenues 1,163.4 1,327.4 1,470.5 Operating Costs Plus Tax 794.5 916.6 963.0 Net Revenues after tax 368.9 410.8 507.5
Notes: (1) Revenue is function of sale volume x price. (2) Operating costs include raw materials cost, wages, electricity, management costs, maintenance/ some replacement costs, packaging, and other indirect cost. (3) Loan repayments for all local and foreign are not included. If these repayments are included they will need working capital. MAP SECTION BSW *oS *or r S sir C H I N A SHAANXI AGRICULTURALDEVELOPMENT PROJECT PROJECTCOMPONENT LOCATIONS (
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