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GRANT BY THE UNITED STATES OF AMERICA RELIEF AND REHABILITATION WMMIGSSION AP-,A GOVERNMENT OF ETHIOPIA

This Grant made / is and effective on tho _ _ _ _day of fP.1 I L_ - , 1977, b; the Government of the United States of America, acting through the Agency for International Development (hereinafter referred to o "A.I.D."), to the Govern­ ment of Ethiopia, acting through the Relief and Rehabilitation Comais3ion (hereinafter referrm to as the "RRC" or the "Grzntee") in acc.ordanco ith the agreement of the partios set forth herein.

WITNESSETH THAT:

WHEREAS, the IURC has requested a grant to procure trucka to relieve the serious hortage of transportation oquipment needed to move food aid emorgency supplies and urgent food ralated com­ mdities frou Ethiopian ports and within Ethiopia; and

WHEREAS, A.I.D., pursuant to the authority contained In th. Foreign Assistance Act. of 1961, as onded, deoirea to furnish asistanco for prograns related to the irprovoeont of the capacity of the RRC to deal with orgency relief and rehabilitation activities where ouch need exista; and,

HEREAS, it has boon dotormined by the Unitcd Staten of Atmena and other nations that ouch asaintance should be furlhod to the Grantee in order to assist the Governnt of Ethiopia *g purchase additional trucks to offoctivoly oupport food aid, onorgoncy relief requIremanta, and urgent food related comoditio and Chat the provision of ouch assistance Is strongly supported and endorod by the United Nations Dinastor Relief Organization (UN=0), to tho United Nationn Dovolopnont Progran (U IDP) and is pursuant to resolutioit 2047 (LXII) adopted on Liy 5, 1977 by the United Nations Economic and Social Council; and

WHEREAS, the Grantee warrants that It has full authority to enter into this Agrooent.

NOW, therefore, it in nutually agreed as follovs: -2-

ARTICLE I

PURPOSE OF THE GRANT

The purpose of the Grant is to proviziv funds to the Grantee to support, with other donors, the energency procurement and ship­ ment of approximately 125 trucks and trailers, with approxiette capacity of 27 tons, and approximtoly 25 trucks of osaller capacity, spare parts, and related goodo and sorvicos, and thereby oxpand the capacity of the Grantoe to coot the problor-3 cauced by exiotinz and future food shortage e=orgoncios. Goods and services financed under the Grant may be utilized solely in conjunction with, and in gonoral support of, the United Nations Project, "Logistic and Technical Support for Food AID Transport", attached as Appondix A hereto, to achieve the purposes stated in this Article.

ARTICLE II

THE GRANT

A.ID. hereby grants to the Grantee an amount not to exceed one million three hundred and fifty thousand United States Dollars ($1,350,000) (hereinafter referred to an "Grant") to asist the Grantee to achieve the purpose of the Project as set forth in Article I.

ARTICLE III

DISBURSEWENT

A. Tho Grantee my, from tine to time, obtain disbursement of funds under' the Grant for the soats of goods and services required for the Project, in accordance with the terms of the Grant, by submitting to tho Director, USAID/Ethiopia, ;-i necessary supporting documontation as prescribed in Project Imloeontation Lottoro (A) requests for reimburse­ ments for such goods and services, or (B) requests for advance disburseomnt for ouch goods and oorvice.. Such requests should in no event be later than six rcontho from the date of this agroont.

B. Disbursoomnts of the Grant my also be =do through such other means as the parties may agroo to in writing. -3- C. Disbursements of the Grant will bo deposited directly by the Grantoe into t'he Ad Hoc Trust Fund Account No. GOV. 380 (hereinafter the "Account"). D. Unless otherwise agreed to by the parties in writing, all disbursonta of funds depoolted in the account will be made within one year from the dato of thin Agroomznt. E. In the event Grunt Fundo in the Account are not fully bursed by the date dis­ noted in Soction D the indiaburjsd will be balance refunded to A.I.D. in U.S. Dollar at A.I.D.'a request. For purpoos of thin clause, funds rotining in the Account but con=ittod by the Grantee to a legal:y binding and non­ cancellable trannaction oligiblo for financing under the Grant will not be included an part of the undlbursed balance in the Account.

ARTICLE IV

ADMINISTRATION OF THE A(COUNr A. Grant funds deposited into the Account will be used only for the purposes not forth in Article I. B. The Account will be oatablihed by the Grantee account an a separate with the National Bank of Ethiopia and will be adminiotered by a Co=ittoo concisting of the following members or their delegates:

- Ooiooionor for Rolief and Rohbilitation, ChnArman - Chief Officer, Planning Co=Iiooion - General Manaaor, Ltional Trannport Corporntion - UNDP (HATRAOO) Rooldont Roprooontativo (Observer),

C. 'he Committeo, which will be convened by the authorize Chalrnan, will disburocnto and purchanoo from the Account conastent with the torna of thin Agroc-nt.

D, All disburoomnto from the Account will be offoctod the signaturen only upon of the Chair=an, the and Co inolonor of Planning the General 12anagor, rATRACO, or their designated representatives. E. The procedures set forth in thin Article ny be modified by mutual Agreement of the parties in acoordanco with the procedures forth set in Section(J)of Article VII.

,.,s/4... -4 -

ARTICLE V

PROCUREMENT

A. The Grantee will furnish to A.I.D. upon preparation, any plans, specifications, procuroient or construction schedules, contracts, or other documentation relating to goods or services to be financed under the Grant, including documentation relating to the prequalification and selection of contractors and to the solicitation o2 bids and proposals. n terial modifications in such dooumntation will likovioo bo furnished A.I.D. on preparation. Docurnto rolatcd to the analycio, review and acceptance of bids or proposals and contiacto for goods and services financed under the Grant will bo approvod by A.I.D. in writing prior to their oxocvytion,,

B, Goods and services financed by this Grant will hkvG as their source and origin countrico included in A.I D, Coographic Code 935 in offect on the date ordoro are placed for ouch goods or contracts exeocuted for ouch norvicoo. U.S, sources shall neverthoeloo be "qually considered vith other sources for purchase of trucko/trallera and onare parts.

C. Upon accoptanco of delivery of the goods by the Grantee, legal ownership of goods financed by the Grant will isst in Grantoe.

D. Registration and operation of vehicles and related equipment financed by the Grant will be subject to the same procedures, linitations ar_ exemptions governing their Importation, registra­ tion ad op ration an are afforded to vehicles ancF equipment imported .nto Ethiopia by the specialized agencies of the United .,ations.

E, All vehicles financed by the Grant will carry United Nations Re ,istration Plates,

ARTICLE VI

TAXES, PRIVILEGS AND IMMUNITIES

A. This -want Ag~ement and the Grant will be free from any taxes, license or transfer fees, or other levies of what­ ever kind or nature.

.. /5... -5-

B, Goods and services procured with the Grant will be exempt from all identifiabre Government of Ethicipia taxes, import, customs and excise duties, registration and licenoe feen, and any other such levy, tax, or duty. In the event that goods and aervices are not no exempt the Granto rill pay or roimburse the ae with funds other than thoo providcd under the Grant.

C. Foreign exchange reotrictions and import licenses will not be made applicable to procuront from the Account,

D. The Government of Ethiopia, act n through the Grantoo csures that it vill at all tizoo and in all circurztancoo hold the United States Govornnt, USAID, thoir officers, employeoe and agents harmloss from all liability of nny hrnd or nature, including coats of oxponDon, for or on account of any or all claima, suits, or damages of any character whatsoevor arising out of porformznce of this Agroement, including accidents or other causet involving the vehicles and equipment procured hereunder.

ARTICLE VII

GENEAL PROVISIONS

A. All commodities and services financed under the Grant will be used to achieve the purposes stated in Article I of this Agreement. In the event Grant funds are not utilirod in accordance with this Agroemont A.I.D. my require the Grantee to refund the amount of any ouch disburomnt in UOS. Dollars to A.I.D.

B. Day-to-day responsibility for tho uo of goods and cervices procured vith the A.I.D. Grant will be oxorcised by the MA designated project nanagor/tranoport coordinator.

C. The Oranteo vill:

(1) Furnish to AI.D. ouch informtion and reports relating to the status of the Project and to this Agreement as A.ID. may reasonably rcquired;

(2) Maintain or causo to be =mIntainod, in accordance with generally accepted accounting principles and practices consistently applied, books and records relating to thm -7- In addition, upon such termination AI.D. may, at A IeD.'s expense, direct that title to goods financed under the Grant be transferred to AoI.D. if the goods are from a source out­ side Ethiopia, ara in.a deliverablo otate, and have not been offloaded in porto of ontry of Ethiopia. G. Any notice, requoot or co=mication givon, made, or sent by the Grantoo or AI.D. pursoant to the Agroomont shall be in writing and shall be doc==d to havo boon duly given, or sent made to the party to which it to addrooced when it shall be delivered by hand or by il, tologram, cable, or radiogram to sunh othur party as the following addros: TO THE GRANTEE:

MAIL ADDRESS: Provisional Mtlitary Govornrant of Ethiopia Chiof Co=oo1onor Relief & aehabilltation ConissLon P.O.Box 5006 Addin Ababa

CXBL ADDRESS: REHAB, ADDIS ABABA

TO A.I.D.:

MAIL ADDRESS: Direetor USAID, Ethiopia P.O.Box 1014 Addis Ababa

CABLE ADDRESS: AMEMB - AID P.0.Box 1014 Addis Ababa Other addresses may be oubstituted for the above upon giving of notice as provided heroin. All notioes, requests, ooanica­ tios and documnto submitted to A.I.D. hereinunder shall be in English, except no A.I.D. my otherwise agree in writing,. H. For all purporoo relative to this agrocnt, the Granteo will be reprooontcd by tho individual holding or acting in the offico of the Chiof OC-=isoionor, Relief and Rehabilita­ tion Commission, and AGI.D. will be roprooonted by the individual holding or acting In the office of the Director, USAID/Fthiopia.

... /7..o Such individuals shall have the authority to designate by written notice additional representatives with plenary or limited authority. in the event of any replacement or other designation or a represontative hereunder, the Grantee shall submit a statement of the roprosonttive's nna and specimen signature in form and oubstanco satisfactory to A.I.D. Until receipt by A.ID. of written notice of revocation of the authority of any of the duly authorized roprooontntiven of the Grantoe designated pursuant to this section, it my accept thv nignaturo of any ouch roprooontativo or reprenentatives as conclusive evidenco that any &ction affected by such instrument is duly authorized,

I. To assist Grantee in the inplc-ontation of the Project, A.I.D., from time to time, will issue Projoct Implocantation Letters that will furnish additional informathn about atters stated in thin Agreement. The partios cay also ue jointly agreed­ upon Project Inplo=-ontntion Lttors to confirm and record their mutual understanding on aspects of the itaplocnntation of thia Agreonnt. Project Implocontation Letters will not be used to amond the text of the Agrootent, but can be used to record rovioiorw or oxcoptiona which are permitted by the Agreement.

J. The Grant Agroemont my be anndod by fornal modifications to the basic Grant docuient or by cons of an exchange of letters between the duly nuthorined roproontativo of the parties. Amondments to Appendix(A) which have the effect of altering the purposes of the Project or the uoo of goods and services financd hereunder will be incorporutod into this Agreement only after the writteu approval of A.I.D.

IN WITNESS WHEREOF, Tho Grantoo and A.I.D., each acting through its respective duly authorlscd representative, have caused this Agreement to be signed In their names and delivered aa of the date and year first writtbn above.

GOVERNMENTr ETHIOPIA UNITED STATHSOF AMERICA

BY: 7'ABY: (.a iC d44V NAME: ,4PD()(it'P KAM:~7/ '0 CAM 47

TITLE- _____ /E ( 4 ." DAT: DATE: ,1277~? AGENCY for INTERNATIONAL DEVELOPMENT UNITED STATES AID MISSION TO ETHIOPIA USAID ...... P. 0. Box 1014 Addis Ababa, Etbiopia

Ato Shimelis Adugna Chief Commissioner Relief and Rehabilitation Commissio, Addis Ababa

Subject: Logistics Support for Relief and Rehabilitation Commission Grant: 663-F-601 Activity No. E-9 Implementation Letter No. 1 Dear Ato Shimelis:

Pursuant to Section 2.4 of the Grant Agreement (663-F-601) between the Government of Ethiopia and A.I.D., the purpose of this letter is forth for Activity E-9, tc set Logistics Support for the Relief and Rehabilitation Commission (RRC), such descriptive, budgetary and administrative information as is considered necessary to satisfy the conditions of Sections 1.2, 2.2 and 7.5 of the Agreement.

1. Description of the Activity: This activity consists of the provision of funds to support, with other donors, the emergency procurement and shipment of approximately 125 trucks and trailers with an approximate capacity of 15 metric tons each and approximately 25 trucks of smaller capacity, spare parts and related goods and services, to effpctively support transport of food aid, emergency relief requirementd and urgent food related commodities. This activity may also be utilized for such other logistics support as may be agreed to frcr time to Lime by A.I.D., subject to specific amendment of this Implementation Letter and available funds.

The total cost of this activity is US$650,000. The funds provided under the Grant in accordance with this Activity Implementation Letter may be utilized for a period of one year from the date of agreement of the parties hereto. However, on request of the RRC, this period may be extended by a written amendment when deemed necessary and approved by USAID/Ethiopia.

Utilization of th? funds provided under the Grant may be in conjunction with funds provided by other donors to accomplish the purpose described above, providing, however, that the equipment procured with such funds -2­ is managed and oper:;,:_d in accordance with the terms of this Implementation Letter and within the terms of the UNDP Project Document, ETH/025/A/45/01 (Special Sup, ort for Disa:;ttr- Relief) attached hereto as Appendix A and incorporated as an integral part of this Implementation Letter.

2. Budget: The budget fi: t~Lis activity shall consist of the following line item:

Item Amount

Contribution to Ethiopian Government Ad Hoc Trust Fund A/C #GOV. 380 $650,000

Disbursement by AID of the funds provided herein shall be made upon written request of the Commissioner for Relief and Rehabilitation, acting in his capacity as Chairman of the Committee administering the Ad Hoc Trust Fund, to the Director, USAiD/Ethiopia for payment into the Ad Hoc Trust Fund. Such disbursements shall be made either as: (a) requests for reimbursement for procurement of the goods and ser­ vices prescribed herein; or, (b) requests for advance disbursements to support procurement of such ,oods and services. Such! requests should in no event b later than six months from thu dace of this Implementation letter.

With respect to the Ad Hoc A/C #GOV. 380 and this Implementation Letter, it is further understood and agreed that:

(1) The account will be established under the auspices of the Relief and Rehabilitation Commission (RRC) and held on separate account with the Na:ional Bank of Ethiopia. 0

(2) Contributions and disbursement to the Acc unt in foreign exchange will not be subject to any foreign exchange/transfer commissions; such costs will also be waived for disbursements from the Account.

(3) Foreign exchange rtstrictions and importation license will not apply to expenditures fmm t'ie Account.

(4) The Account and this Grant will be used solely for the purchase of vehicles and spare parts to establish a transportation fleet under the financial and technical administration of NATRACR (Se.. Appendix A). Pro­ curement will be effected on the basis of international tender, with the standardization objective being paramount. Day to day control of the use of the transportation fleet will be delegated to the Project Manager/ Transport Coordinator to be provided under the terms of the UNDP Project Document (See Appendix A).

/ 7' -3­ (5) Vehicles purchased against the proceeds of the Account and this Grant will be imported duty-free under the exemption to customs and excise duty granted to the RRC. Legal ownership of the vehicles will be vested with the RRC. Registration, operation and disposal shall be subject to the same procedures, limitations and exemption governing the importation, registration, operation disposal of vehicles and equipment imported by the specialized agencies of the United Nations and as such wil carry UN registration plates.

(6) Vehicles procured from the proceeds of the Account and this Grant will be used solely for the specific purposes described in the UNDP Project Document (See Appendix A) and will not be diverted to other projects or used for purposes other than those set forth in the UNDP Project Document without the written consent of the Director, USAID/Ethi)pia. The Government will at all times and in all stances circum­ hold USAID, the United States Government, its officers, employees and agents harmless from all liability of any kind of nature, including costs of expenses, for or on account of an' or all claims, suits or damage of any character whatsoever arising out of performance of this agreement, including accidents or other causes involving the vehicles.

(7) The Account will be administered by a Committee consisting of the following members or their delegates:

(a) Commissioner for Relief and Rehabilitation, Chairman Planning Commissioner General Manager of NATRACOR UNDP Resident Representative (Observer) 0 (b) The Committee, which will be convened by the Chairman, will authorize disbursements and purchases from the Account for the purposes agreed upon within the framework of this agreement. (c) Disbursement from the Account for the principal pro­ curement action will be effected upon the signature of the Chairman, the Planning Commissioner and the General Manager )f NAThACOR.

(d) The Committee will arrange for presenting to A.I.D. and other participating donors, audited accounts reflecting all incomes and expenditures pertaining to the Account, as well as such other reports as set forth in this agreement with respect to the Grant, or, as may otherwise be determined by A.I.D., but, in any case, within six months of the end of The Ethiopian financial year following the evaluation of this agreemenL.

I, -4­

3. Implementation Agency:

(a) This activity will b( carried out by the Relief and NYhabilitation Conimission in c ,operation with trihChiirman, Ethiopian Central I Lanning Commission, ch( Genoral Manager ,f NArRACOR, the UNDP Resident R. presentative as described in Section 2, hert in, and within thc framework of the Consul­ tative Commnittee as ; t forth in Appendix A, attached hereto. The Relief and Rehabilitation Commission will be represented by Ate Shimulis Adugna, Chief Commissiont.r.

(b) The fd ,wi:- signatures will be accepted for required certification i. connection with disbursement requests, procurement, reporling and such other purposes as -.a, ne required in connection with this Activity:

(1) Disbursements or reimbursements: As set forth in Section 2, Budg. t, he re in.

(2) RF port s : Shimelis Adugna, Chit-f Comri.issioner, .v,.inew Bezabt-h, Deputv Chicf Comnissioner, Chanyalew Alemayehu, Planning Coordinator.

4. Imp! uentation Schcd .1c: As set forth in AAp ,di:. Section r, Activit ies, h. r( in.

D. R.cords, Rtprts and inspection

a. .a int.nanc.: and Audit ,." Reccrds: RRC shall maintain, .,r cause be maintain.d,! in ardanct. ith ;-.nd account ing principle., and pra tic .: c : ;i. a pp itd, iv.,oks and reccrd, :' !ati,- :h, activity and t jis " t:I: L:r .r. Such books and r,.L .rd.: sh,4 be adequate ta' siow:

(U)f', rv.cei;t arid disp&."~:i.,n ', ade ,cod: s and...i v, s acquirtd ,it), . nds disbur. J ;,urs.'.,:t to th: s '"; i,' ':ati, tur; and

, (2) Thu currt.. sat.; and pr',;r,.s :h% Activity. Such books rtc..'rds and sha . be re.u 0.udi:,do: .a.s, . ,' a': ited by the R.RC in ,,:cordanc . :ith ', .'Id a,:diting st.ndard, and :.hall . maintained for :nire. yea:s after tht (late ,! th.. last d isburse..un by A. I.D.

b. Reports: rhe RRC shall furnish, or cause to be furnished, to A.I.D. such information and reports relating t, the activity as A.I.D. may request.

/ -5­ c. In addition to such reports as may be required under Section 2., Budget, herein the RRC shall also provide to A.I.D., an accounting of all expenditures r!ad from the Account.

d. The Grantee shall pursuant :c Section 2., Budget, herein maintain books, records, documents, and cether evidence in accordance with the RRC's usual accounting procedures to sufficiently substanti&le charges to the Activity. The RRC shall preserve and make available such records for examination ard audit by AID and the Comptroller General of the United States, or their authorized representatives, (1) until the expiration of three years from the date of termination of the program and (2) for such longer period, if any, as required to complete an. audit and to resolve all questions concerning expenditures unless written approval has been ob­ tained from A.I.D. to dispose of the records. A.I.D. follows generally accepted practices in determining that there is proper accounting and use of grant funds. The RRC agrees to include the rvquirements of this clause in any subordinate agreement lieunder.

e. Inspections: The authorized representatives of A.I.D. shall have the right at all reasonable times to inspect the Activities carried out under the Project, the utilization of all good and services financed under the Grant, and such books, records and other documents relating to the Project and the Grant as may be maintained by the Grantee, the Grantee's designated disbursing agent and/or implementing Grantee shall cooperate agency. The with A.I.D. to facilitate such inspections arid shall permit representatives of A.I.D. to visit any part of Ethiopia for any purrose relating to thv Grant.

6. Non-AID/GOE Inputs: Inputs from other donors arv anticipated at a level of approximately U.S.$8 million. At this time, contfibutions to the Ethiopian Government Trust Fund are projected from the Government of Sweden, the United Kingdom and from Lutheran World Federation.

7. Procurement: In accordance with the provisions of Article V, Procurement, of the Grant Agreement, and in recognition of the specific emergency circumstances constitutod by the appeal of tie Ethiopian Government and the establishmen: Lf th.- Ad Hoc Government Trust and UNDP/EPMG project Fund (Appendix A), the Director, USAID/Ethiopia hereby authorizes the procurement of goods and services which have their source and origin in countries included in AID Geographic Code 935 in effect on the date orders are placed for such goods or contracts executed for such services. U.S. sources shall nevertheless be equally considered with other sources for purchase of trucks/trailers and spare parts. -6-

Tho Grantee will furnish tc A.I.D. upon preparation, any plans, specifications. procurement or construction schedules, contracts, or other documintation relating to goods or services to be financed under the Grant, including documentation relating to the prequali­ fication and selection of contractors and to the solicitation of bids and proposals. Material modifications in such documentation will likewise be furnished A.I.D. on preparation. Documents related to the analysis, review and acceptance of bids or proposals and contracts for goods and services financed under tht Grant will be approved by A.I.D. in writing prior" to their execution.

8. Modification of the Activity: This activity may be modified from time to time by the issuance of additional Activity Implementation Letters.

Signed on Behalf of RRC Signed on Behalf of AID

Shimelis Adugna T' Princeton Lyman Chief Commissioner Director, USAID/Ethiopia Relief and Rehabilitation Commission

Date - L/Date ' ~.

__ U

PArE 01 A0DIb 11590 2 6110 aZ

ACTION AIO-31S

TNF0 OLT-m1 AF-05 IGA-02 EB.05 1044 W uuwu'''m--in.I... -­ wwm.. 025 d 74 P P60709Z SEP FM AMEMBASSY ADDIS ABABA TO SECSTATF WASHOC PRIORITY 1239

lINrLAS AD.TS ABABA 11590

AInAC

FI, 116521 N/A AURJECT: RAAD SOURCE/ORIGIN PROVISIONS

AIr)AC

PEFI (A) ETHIOPIA PAA) OTDO 8/15/74 (B) ADCI 11480 (C) SNYr)ER/CYLKE CONVERSATION 9//74

l, PER NEF (8), PARA IV, MISSION WISHES TO PROVIDE FOLLOWING ADnITIONAL DISCUSSION RELATIVL TO AID/W CONSIDERATION/APPROVAL PAAD SOURCE/ORIGIN PROVISIONS CONTAINED PARA Ili 0,F 31 SPECIAL nE'ERMINATIO N S (PAGES 36/37/38), 9, AS OUTLINED IN PAAO PER PARA to ABOVE, PROCUREMENT TIMING AND .OmPATI LTITY ARE CRITICAL ELEMENTS BEARING UPON IMPLEMENTATION ,PFEO ANDj SOLINOESS OF PROPOSED USAID/E R&R PROGRAM. WITH REbPECT TO TTMINGp MISSION PROCUREMENT HISTORY REFLECTS UNUAL PATTERN OF IETNEEN Sl AND FOURTEEN MONTHS VOR U0 S ' COMMODITIES AS A WHOLE, WII'H HEAVY EQUIPMENT OFTEN HAVING LEAD TIME6 OF EIGHTEEN TO TWFNT)~F'"Up MONTHS, OVER THE PAST TWELVE MONTHS1 GIVEN BOTH rUNTINU-r SUEZ CLOSING AND TRANSPORT DEMAND DUE REnUINEMENTS, DROUGHT THIS OELIVERY LAG HAS TENDED TO HIGH BIDE. WHYLE US, PROCUREMENT IS OBVIOUSLY NOT PRECLUDED IN PAAD PRnPOSAL, TIMING DEMANDED BY IMPLEMENTATION WILL NOT BE PA ILITATEr) BY STRICT AOHERENCE TO AID PROCUREMENT GUIDEw lINES, IF ETHIOPIAN GOVERNMENT TO ASSURE EFFECTIVE IMPLE- MENTATION TIMING, CODE 935 PROVISIdNS MUST OBTAIN, IN TERMS

UNCLASSIFIED ~*~ DcA1 of ~~

UNCLASSIFIED

PAIE 02 ADDIS 11590 2S1106Z nF COMPATIBILITY, WHILE SPEC:FIC COMMODITY NO? YET FULLY DETAILEDo REQUIREMENTS ARE IT 18 CLEAR THAT A SUBTANTIAL REMUIIEMENT DOES EXIST AND COMPATIBZLITY DOES PROVIDE ADDITIONAL RATIONALE SUPPORT OF THE SPECIAL DETERMINATIONS. IN THIOPIAN AT LEAST 90 PERCENT OF PRINCIPAL EQUIPMENT AND SUPPORT TTAL!AN AND MATERIAL IN UEHIS OF EUROPEAN ORIGIN, FIJRTHER, EVEN FQ"IPMENT TN REPLACEMENT PARTS OF U.S. USE ARE NORMALLy PROCURED FROM WHICH ARE EUROPEAN SOURCES TNTERPMIXEO EURUPEAN/U,5. ORIGIN, 3. MISSION BFLIEVES RATIONALE OUTLINED IN PAAD PER ATTLL FULLY APPLICASLE PARA 1 ABOV9, R/R PROGRAM NEED FOR ETHIOPIA AIn/w ACCEPTANCE THI AND URGE$ SPECIAL DETERMINATION$ ADVISE, WYMAN

UNCLA8SIOIED 1*4 & Departmen of Stale s/a

UNCLA8zFIED 9757 PAME 01 ADDIS 11480 01 OF 03 24095OZ

11 ACTION AID-59 TNFO OCT-01 AF-05 IGAw02 EB-05 SR-0 ORM0 CIAE.00

10-09 QODE.00 /086 W P P40556Z SEP 74 124843 FM AMEMBASSy ADDIS ABAHA TO SECSTATE VASHDC PRIORITY 1200 IINCLAS SECTION 1 OP 3 ADDIS ABABA 11480 AInAC

p~fl,116521~ NA SURJj ETHIIOPIA RECOVERY AND REHABILITATION PROGRAM REP' (A) STATL 196889p (8) PAAD B-15, APPRAISAL CC) TOAID A-64# (D) IUA OF DROUGHr AREAS REHABILITATION OTO, PROJECT ETHIUPIA JUNE 7s 1974, (E) EPI, MINAG, PROGRAMME FOR MEDIUM TERM REHA8I4TTAfP. SETTLED AGRICULTURE IN DROUGMT-BTRICKEN PROVINCE3 OF ETHIOPIA, EPID PUBLICATION NO. 20, AUGUST, 1974, (F) ADD18 7218 T, FOLLUWING IS MISSIUN RESPONSE TO REF A, AID/W AUTHURI. AMFND DRAFT PAAD INCORPORATE INFORMATION CONTAINED BELOW$ A, PROGRAM OBJECTIVESI i, TO PROVIDE EXPERTISE, wHYCHl COMMODITIES AND SOME CAPITAL WHEN CONCERT-D WITH LTHIOPIAN RESUUkL GOVERNMENT AND OTHER PEROURCES, WILL RAPIDLY REDUCE DUNLR 4Nn AND LVENTUALLY ELIMINATE FAMIN NEAR-FAMINE CONDITIONS WHEREVER THEy STILL CONTINUE TU ?N ETHIOPIA, EXIST Ps TO HELP THL PEOPLESo TRIBESl LINEAGES OF THE AFFECTED AREAS TO RECOVER DROUGHT- FROM THE EFFECTS OF THE DROUGHT, TO REGAIN THEIR AGRICULTURAL ANU PRODUCTIVITY AS RAPIDLY AS P05SIBLE, 3, TO DO WHAT CAN BE DONE IN THE NEAR TERM TO CAPABILITY OF PEOPLES INHABITING INCREASE THE DROUGHT PRONE AREAS OF ETHIOPIA

UNCLASSIFIED • .r,, ,. . J ,. ? v

, ' h: ' JK:,,'

:'i. ASS I F Sr

PAM, 02 A'1b uilw ot OF 03 2409b6Z

TO BETTEk 'ITHSTANO THE ADVERSE FFFECT$ OF FUTURE DROUGHTS, 4 , ;r1T ,, CAN Hl"- DONE TiN THt. ,,EAR . ' NL Ki. PR DIC .,; F" bAST: F-JO ','F S 1N l:17'PTA LN UROE.;' TU Ml.­ SHF','-rwUIEME;4T FOR UfGu , SSI'ST ,NC ".T 00JL U"UUull1 C ; ,,.

'i, 1 HEi.P 0 'h TH: Oi., ; GOVE~eNMFNT t'J-VL!-( A SYbr rAPA LE F" L)ETfu , CTJ JG INC 'I' , ijR ~jbi: C'NS 8ik. r)ISASTE!? bT rUArnrq 1 ,.'s I ANU TO H-. P ,. " :. 7FFICENT 0COV N'tNT "i- JNSE MlCHAN 1*xss '. PE PL 5 U V I PKOTA. ;Eu ORu piH r C Ih:j , R,, ,'. Pk GRAM O3j, TIVES :0 l ; ,

i, DROUGHT SITUATI/fN HAS BEEN EXTLN TVELY CUVLRED REF C AN n S iM 1-1, 7.1FUPLjSL;N I.A,2 PAA r,, bNCL MEN ADbUiT-!7L, TNF 0R A IU fi',.4 TA rL OF RUUGHI HAS 8iECOME "VA LABL L ,.,, PURLILA[ION HARRARGHE NUTRITIONAL SURVEY, INFORMATION 1i ", AY THE OVFRNUR OF GEM0 GUFA PRUVINCFi ANt, SbUANLE MO",,- PRn GRSb kFPOHTS UY RF.LIEF COMMISSION. 5UMliARY NELEVAN,. YNFORMA'ILN AS FOLLDWSZ A, SOUTHERN ETHIOPIAI POCKETS OF FAMINE STILL REPO6kii XANT IN REMUTE AREA6 LEMU GOFA. F)HDnUGHT CONUITION N I APGF PORTToNS GE'IU GUFA ANL IN PARTS OF 6OUTmEFN SI, . ' . . nF bALE AND 5 AT ThiRED AriEAS OF rARRAR,HE. RAI 115, "r t HAVE T"fHUS FAR PktVFO IN5U F±CiEhTo LAVFSTUC, _2 .SESS "t PEPORTEu HEAVY WITH RXISTjN, I E4nS LN MOSr A .5A (.NL, . PO P SURVIVAL, - . WHILE N d UVLRT 51ARVATrON R (.f KW'Eo ',Akf:,- ', HI H INFANT MORTALITY R CURDEU hHIC'i APPEARS N . Aur. ,,' ATTRIBUTAbLE TO UNDERNUTHTION, PASTORALISrS TN S.. - 1'.k nLPENUENT UPON SELLING LIVE-TUCK Fflk 1,RAIN,, . AN P6'-' H ARF 300 PERCENT ABOVE NORMAL AT TIME OF ,URVFY. R, TIGRE WOLLOI ARMYWOR" IJFEST!,Tnr;q wHl CH; EAri1JEH. ,OIJTH HAS NOW ATTACKFU N Y''rIFR PROV C S w 1 ' roLn rRnP LOSSES .., , ,. -. . OLCURRINC, GRASSHUPPFR rNOT DtSEF LOCUST) INFESTATION A.,SO OF SRIOUS P(IPORT I NS., l)T uLENUING C 'A HAS OECOME SERIOUS BOTTLEt FCK, MANY nONORS Nni, OP.QAT', , YN TIGRE/HOLLU. .,, IUA $1 MiLLION CREUTT APPrfOVti, AI' U ,%. . RLqUMPTION BY THF VICTIMS OF DROUGHT -N TjnR," A '. . . PRr)DUCTIVL ACTIVITIES UrrUOTE, ANU CREATING QUOrE ]HE LONG .' A TERM PROGRAM FUR THE DROUGHT AREAS BASLD ON INTEAI:'-

E AVAILABLE COPY LINCLASSI.FIF D Dpartment of StateeIa..AM

UNCLAS8IFIED PAnE 03 ADDIS 11480 01 OF 03 240966Z PRMJECTS WHICH WIll. 8 YNSTYTU1XONAL, IMULTANEOUSLY ADDRESS ADMIN7STRATIVe THE VARIOUS PHYSICALs =HITHERTO AND TENURIAL HA',iPERED DEVEOPMFNT PROBLEMS WHICH 1JN(UOTE, AND CONTRIBUTED HAVE (SEE REF TO RURAL PnVER'yf ?MPLEMENTATION D, PG o 79) IDA PHASESo PROGRAM NOW IN FINAL WOLLO DONOIRS ENGAGED PRF- INCIUDE GERMAN GOVERNM2NT, IN ROAD CONSTRUCTION 9OVERNMEN'o STERN MAGAZINE 1S, NORkIEGIANVOLUNYARY GROUP, BRRITI . INTERNATIONAL ORGANIZATION AND MISSION5 VOLUNTARY SOCIETY (-F COORDINATION ASSIGNED ORGANIZATION, OVERALL TO PRITISH DDM ROAO . MEVELOPMENT IN WOLLO/TIGRE GROUP. UNDLRGROUND PEROURCES 8ETNG UNDERTAKEN WAY'L COMMISSION WITH BY NATIONAL ljN CLF ASSISTANCE FROM WATLR Uof , GERMANY, SWEDEN IDA CREDIT AND PRJECTs AND CHURCH GROUPS. HV ARE UN9ER DXRECTION SURFACE AATEq MEPARTMENT EXTENSION AND (UPID) OF PROJECT IMPLEMLN't rRt7DT 'I1NAG AND WILL Ar,*, (HT, 1.7 MILLION BE FINANCED BY THE rRMP PROTLCTION, FOR THIS PURpOSE), IDA SOIL (kONSERVATION t11WIGEo EXTENbION, ?MF O AREAS AND FORESTATION HAVE BEEN DEVQL PROJECTS IN PED BY EPID (SEL REF nC FINANCED LARGELY 0) AND WIL4 BY THE IDA GRANT. P, RELATiONSHIp OF PROGRAM As OF' FIR31'R OS,,'ECTIVES TO ORIy IS THE ImMEDIATE DROUGHT SITUATION. PROPRM OUJECTIVE NEED, AS No, I ABOVEo STATED IN RAMINE CONDIYION8 TO TERMINATE FAMINE THAT MAY STILL AND NEAR. PROMY!8ON OF FAMINE 1ZIST IN ETHIOPIA. MENTS RELIEF POODSYUFFS THE By NUMEROUs DONORS AND EMERGENCY INCLUDING THL MEDICA. NAS AS OF NOW NEARLY US (SEE ANNEX ENDED THE IMMEOrATE 31 RLF C) TN ALL UUT A FEW REMOTE, THREAT OF STARV,'TION flULKFICI INACCESSIBLE AREAS NT FOODSTUFFS APPEAR OF GEMU GOFA. ANt) A J0ING TO SE ON HAND ETHIOPIAN GOVERNMENT/DONOR FOR IMMEDIATE NE&OS eUPRENTL\' TEAH A3Q5LtJSNG THE 8ZE OF EXPERTS MC7ERMYNE OF THE NEXT HARVEST THE NEED FOR EXTERNAL Ii ORDDR yo M13ION INDICATED FOOD ASSISTANCE (REF F) A :N CY 1975, A8998TANCE LIKELY FY 1975 REQUIREMENT THE OF APPROXIMATELY FOk Q,4, PEASONABLt. IN M0,00 TONS WHICH S REGARD TO THE ACUTL TILL APPEAkS O MU GOFA (IN WHICH PROBLEM OF ACCESSIbILITY AIRLIFT OF FOOD IN WA& BEEN NECESSARY) TO EIGHT DISTRIOUTION PROVINCES THE HIGHEST PRIORITY POINTS RURAL ROAD AMONG THE SOUTHERN ?HV AROA PROPOSALS HAS SEEN MINCHnKONSO AND GIVEN CONSTRUCTION ON THESE GIOOLg-JINKA ROADS OF MINIMUM STANOARD, IN GEMU G93FA, WORK AFTER THE LOW COST ROADS WILL CONCLUSION OF' TIE START IMMEOIATELY PAMINE AREA PRESENT RAINY SEASON. WHERE ACCESS HAS ANOTHER KEY PROVED NEARLY IMPOSSIBLE 16 EL KgRe

UNCLASSIFIED Department of State

t " 02*lI:s 1 e

UNCLASSIFIED

PAVU :4 ADDIS 11480 01 OF' 03 40958Z IeOO VHM SOUTH OF THE WEBI SHEtBELE RIVER IN, BALE PROVINCE MORE THAN WHERE 100000 DROUGHTmAPPECT2D NOMAUB CONGRUGATED DURINU HF.20tP THE OF 7MI, FAMINE AND WHICH 16 QJITE LIKELY' YO 6E AFFECTEO AGAIN TH15 YEAR, AN EMERGENCY ACCES8 ROAD PROMGINIR TO IM! ANf) THEN 5OUYH Tnl EL KERE IS.LIKELY TO BE CONSTPUCTED Q0P PUND8a FROM AIX IN SIDAMO# ON-THgGPOUND STUDIt OHOW THE PRYPOrITy HIGHEBT To BE FTRST, A FOAD CONNECTING NEGELE, WITH THE DAWA PIVEP AND THE ALREADY EXTANT ROAD FROM wACHILl, DEONOYRUCI' AND, 8ECONOY ON AND REPAIRb ON THE ROAD FROM PILTU pTWZOPIAN GOVERNMENT TO DOLO. THE I8 APPARENTLY WILLING TO UGE IT8 OWN FUNOS POP THE LATTER ROAD, f.ri0 NEXIC YN IMPORTANGEt AND THE BEGOND PROGRAM OBJECTIVEo 73 THE: NE D TO GET DROUGH>-AFRECTED FARMERS AND NOMADS PRODUCTIVE

UNCLA588FIED 41.1

UNCLASSIFIED 97B!

PAOE 01 A0DS8 11480 2 OF 03 241007z

ACTION AXD.Sg NPO OCT-01 AF-0 EB- b IGAmO2 CIAE.00 6WF- 2 SR-L' S".':

10-09 DDDE-00 / 86 N

P 4558Z SEP I'M ADIIS74 ABABA 9MEMBASSy TO 8EC8TATE WASHAC PRIORITY 1IE9

PNCLAS SECTION 2 1140/2OP ADDIS ABABA AIAZN AND 0OUNDERTAKE PROGRAMS WHICH WILL INCREASE THEIR ArI(Y TO WISE TAND FUTURE PRUGRT SITUATIONS. EPI HAS ALREADY

PURCHASED 15;000 TONS OF SEED WHICH HAS BEEN DISTRIBUTED O5BM000 TO FARMERS, PRINCIPALLY IN TIGRE, WOLLO, SHOA YN ADDITION, AND HAkRAGiF. b,000 FARMERS IN TIGRE AND 1di 00 IN WOLLO, 60L 9HOAs 800 YN HARRARGHE N AND 400 IN BALE HAVE RECEIVED EPID LOANS POR THE PURCHASE OF OXEN USING IDA FUNDS REF E), THERE CONTYNUEQ TO BE NEED FOR SEED DISTRIBUTION AND OXEN LUANS TU PARMER8 NOT YET COVERED IN IHESE PROVINVES AND 91MAM0 FOR FARMERS IN AND GEMU GOVA WHO HAVE NOT YET RECEIVED SUCH LOANS, 800THERN PASTOPALISTS WOULD RECEIVE HELP IN MAINTAINING THEIR RX!OTING HPERDb (UPON WHICH THEIR LIVELIHOOD I ALMOST 100 PERCENT DEPENDENT) THROUGH THE CONSTRUCTION OF NUMEROUS PJNUS, RTREAM DVERSIONS AND SMALL DAMS UNDER THE AUSPICES OF EPIU eAND, IN PASTORAL AREAS OF SOUTHERN ETHIOPIA, HEAT THE LIVtSTOCK AND BOARD), GIVEN THE FINDINGS OF THE HARRARGHE NUTRITIONAL SURVEY, CUONSYTRUCTION OF SUCH LIVESTOCK WATERING MANY PLACES IN Ab AREAS AG POSSIBLE BEFORE THE NEXT RAINS IS IMPERATIVE MRnER THAT IN HERD SIZES NOT SHRINK FURTHER, THE EXPANSION OF AEPO AND OXEN THE PROGRAM AS NWELL AS GROUND WATER DEVELOPMENT WUULD RE ELIGIBLE FOR AID R&R FINANCING, BOTH TYPES OF ACTIVITY ELPARLY PIT WITHIN PROGRAM OBJECTIVE NUMBLR TWO ABOVE AND, ALL HHILE GEOGRAPHIC AREAS WOULD BE ELIGIBLE FOR AID FINANCING, PMPHA8IS WOULD BE GIVEN TU THOSE AREAS IN THE SOUTH PAOTORAL INCLUDING AREA& NOT YET REACHED BY THE EPID PROGRAM. PROGRAMb OF PVO'8 WHICH INVOLVE ACTUAL RESETTLEMENT OF DROUGHT-8TRICKEN FAMILIE9 FROM THE RELIEF CONTERS WOULD ALSO BE ELIGIBLE AS WOULU SUCH OTHER PVO PROPOSALS AS THE FAMILY GARDEN INSTRUCTIONAL

llNCLASSIFIED A'" li ts° 5 L ~' tL' AA

UNCLASSIFIED

PANE 02 ADDIS 11460 e2. OF 03 2410O7Z

PRfMGRAM FOR WHICH WE HAVE RECEIVED A PRELIMINARY REQUEST FOR A8SISTANCE, n, (1) PROFOSED PROJECTo WHICH WOULD SERVE PROGCRAM flBJECTIVE NO, 3 ABOVE INCLUOE EXPANDING THE USEFULNESS OF T,:t RIVER VALLEYS IN THE OROUGHT AREAS THROUGH DEVELOPMENT LF IRR GATION AND RIVER VALLcjY SETTLEMENT PROGRAMS (AS IN 'THt iOmf PROPOSAL) , THE rLVIcPMENT OF INCREASED NUMBEPS UF 3rOLl PONDS IN THE PASTORAL AkRVAS3, GENERAL DEVELOPMENT OF BLT E,i ACCESS ROADS TO MOVE FOO() INTO DEFICIT AREAS (AND OUT OF $II*. ARqAS), EXPANSe(ON OF EPIP EXTENSION SERVICES INTO nkuGr',- , NOT ONLY TO l("'LEMENT TPIF FMFRGENCY SEED AND OXEN PROGNr ,. TO TEACil THE FARMEPC THE A0VANTAGES AND TECHNIQUES OF . WATER CO>!5ERVATION, THF P-OJECTS INULD ALSO INCLUDE EXPA.. LOOAL AND ON-FARM CROP STORAGE FACILITIES. CURRENTLY 70 LuCA;. g E4 VV 5.EN CONSTRUCTED IN DROUGHT AREAS AND EPIO HAS 00NOR FUND'3 FOR ANOTHER 15, HORE THAN HALF OF THE 150 EPID P91V.N8YON LLNTERS IN OROUGHT AREAS NOW LACK ADEQUATE STORAG. PAOILITIES INCLUDING THE ADDITIONAL 20 EXTENSION CENT%.RS NEELU.- YN 7'E 80UT, THESE' t.RE BEING BUILT WITH IDA AND AID RELItF RUN030 IT IS E8TIMATED FRUM ThE EXPERIENCE OF THE ONmGOINbj VPTD PROGRAM THAT .T IS POSSIBLL FOR 10r0 IMPROVED ONUFAkM STnRES TO BE CONSFTRdC'ED ANNUALLY iN EACH EXTENSION CENTER AT A LObT IF ETH,3r -AC!". THE FAULR WOULD RE PROVIDED INTEREST-FREE nRRDIT FROM TP). HE ,inULU HAVE TWO YEARS TO REPAY, T US, OY[t A TWOw-YEAt PERIOD 30,000 ON-FARM STORES COULD Bt CONSTRLCIE1j .; ?HF. DROULUi' ARIAS LiNDEP THIS PROGRAM. IF EPID R4QUIRE5 A. &, PUNDS FOR THY, PURPOS_ TO SUPPLEMENT IDA AND OTHER UNDS. : , pRnGRAMi U!0LJLD CLEARLY BL LLIGIBLF FOR AID R&R SUPPORT. f) RIURAL H : .TH PROJECTS WOULD ALSO NORMALLY ASSIST Ik AC, ' V;NG PI l .0PAMOBJ-CTIVE NUMBER 3, BUT THE HEALTH zEkv2.:' SMUATION JN LTHIOPIA Ib A DIFFICULT COMBINATION OF PPCOLL' WHTCH DO NOT APPEAR TU At-LOW FOR MEANINGFUL PROGRESS UL',,v-,, TIHE 'WflvYEAR PAy-UFF PERIOD INTENDED BY CONGRLSS IN THE L GiS,.ATTGI . $FE HEALTH SECTOR ANALYSIS AND RELATED SECTION OF TE ETHIUP 'A f)AP FOR A DISCUSSION OF THE PROBLEMS). BA61GALLY, THERE I SERIOUS NATIONAL SHORTAGE OF ETHIOPIAN MEUICAL ANU PARA-MEDICAL PERSONNEL WHIC IS BEING ADDRESSED IN THE LONG-TERM BY THE DtV IUP- MENT OF EXPANDED INSTRUCTIONAL FACILITIES FOR DRESSERS AND HEALTH ASSISTANTS UNDER UN AND WHO PROGRAMS, THERE ILL NOT &E MEASURABLe ICNREASES IN THE NUMBERS OF STAFF FOR EXPANDED RURAL HEALTH SERVICES DURING THE TwO-YEAR PERIOD COVERED By THE AID R&H PRJGHA-

UNCLASSIFIED Z1% It Of WL'' r--- 4w~ -

UNCLASSIFIED PAPIE 03 ADDIS 11480 02 OF 03 241007Z

CRANT AND THUS HEALTH HAS NOT BEEN INCLUDED AS A SPECIFIC CATEGURY 1POR ASSISTANCE, HOWEVER, HEALTH PROPOSALS SUBMITTED 3Y PVOS FOR Alm R&R ASSISTANCE WILL BL CONSIDERED ON THEIR MERITS By THE MISSION13 REVIEW COMMITTEE, IN ADDITION, MEDICAL SUPPLIES ANC PERSONNEL CAN BE (ANLO HAVE BEEN) PROVIDED IN .MERGENCY SITUATIO.4S OIRMM REL7EF FUNDS. AS AID/W AWARE, THE MISSION HAS TENTATIV.LY tAPMAHKED S2 MILLION OF TF_ $10 MILLION APPROVEU POR -THTOPIA FOP 1REI IEF ACTYVtTIES, n, PROGRAM OBJECTIVL NO, 4 COVFRS POTENTIAL SHORT TtRM, REPEAT SHORT TERM, PRUJECTS WHICH COULD SIGNIFICANTLY INCWEAS6, PRnDUCTION OF FOOD3'g'tJFFS IN ETHIOPIA OR INCREASE TH. AVAIL AbI :r POR PO23.C ,3[.., FAMINE RELIEF OF SURPLUS FOOUS FROM UTHER ARt.t - FTkIOPI ,IHIC l FOR NHATEVER REASON WFRE NOT MADL AVAILAdL "iO tOEPDY PECIX.-IENrS DURING THf RECENT FAMINE SITUATION. PRuJ.(U'iS WHCH WOUL) CIUALIFY UJNDER THIS PROGRAM OBJELTIVE WOULO INL[.UDr MAKING SIGNT'.TCAN'rLY MORE AND BETTER 5LED AVAILABLE TO ,THIUPJAN VIARMERS 1tN1ThE N-AR FUTUR_ (EPI. SEED CLEANIN .oUIPM.NT HEUU.SL, PLANT PRO'CI71ON (REDUCING LOSS TO INSLCTS THROUGH DEVELOPMLNT OF A UET7EL EARLY WARNING SYSTEM A(, 4NST ARMY WORM SIM, LAR TN3vCT INFE6TATIONS INVASION b AN,. AND A MORE RAPID AND EFFECTIVE fRPONSI. :APA" TL'pY), RU'LOING LOW COST ACCESS ROADS TO SURPLUS ARFAS; HELPING ESTABLISH AN EMERGENCY FOOU bUYING SYSTEM TO RErOVE OPL RATIONAL DURING SERIOUS OROUGHT 3ITUATIONS (POSSIbLY 1E INCON'PURATEF EE.'FNTUALLY ro INTO A PERMANENT AGRICULTURE MARKETING r.OpFPO ATION OR THE LIKE; STEtMMING FROM THE IB?(D/AID NATIONAL nRAIN SrOAGE AND MARKETING PROJECT). THE DECISION TO USE R&R PUNDYNG RATHER THAN REGULAR AID DEVELUPMENT PROGRAM FUNDING A GIVEN iN3TANCL WOULU IN iEuUIRE THE EXISTENCE UF BOTH A TIME OUNSTRATNT AND A CLEAR RELATIONSHIP TO THE UROUHT, F, PROGNU,.M UOJECTIVE NO, 5-- ASSISTING THE ETHIOPIAN MOVERNMENI TO DEVELOP AN EFFECTIVE DROUGHT OR DISASTER RESPUNbF 197.TEM -- HAS ALWAYS bIEEN AN INPORTANT COMPONENT OF THE MISbIUNIS r)VPRALI. 3TRATEGy BUT viAS NOT INCLUDED AS ONE OF THE PAAD LATEuO P'OP RP ASSISTANCE 6FCA;jSt ..'iS o HAVE CONSIDERED IT MORE CLOSELY TIEO TO RELIEF (ON THE GROUNDS THAT THE SYSTEM PRYMARTLY AN LMERGENCY ENVISIONED Ib 5YSTM ENGAGED IN DETERMINING THE NEED ANn ACTUALLY PROVIDING, FOPF', RELIEF), WE PLAN TO FUND ACTIVITIES 9UPPORT OF ACHIEVEMENT IN OF THIS OBJECTIVE FROM THE S2 MILLION FARMARK D FOR RELIEF UNLESS AID/W STRONGLY PREFERS THAT IT ?NrLUDED IN LiE R&R ACTIVITIES INCLUDED IN THE PAAD, AC'IVITIES/ACTIONS THUS FAR UNOERWAY IN SUPPORT OF PRORAM ObJECTIVE

UNCLASSIFIED S r

,,1tNr

UNCLASSIFIED PAnE 04 ADOI 11480 02 OF 03 2 4 1007Z NO'.*9 INCLUDE: 1) ETHIOPIAN GOVERNMENT R&R COMMISSION ACTION ESTABLISHING AS A PERMANENT BODyp 1Ht NOVERNMENT,-OnNOR 2) THE SETTING UP COMMITTEE TO GATHER OF A JO]i. fn'EERMINE PUTURE DATA ON THE HARVI.SF NEED61 3) THE AIODF{NANCLD ANU eOMMUNICATIONS STUUY ON ADDITIUNAL REQUIRj.MRNT3 POR RAPID t7RnM AtCTVLy, INFORMATION FLON TO AND POTENT-ILLY AFFECTED AND ADfDITION, ARLAS OF ETHIOPTA. YHE DEVELOPMEN I)F N 7NVSION8 AN EARLY WARNING SYSTEM TS AN IMPURTANT COMPONENT, FOR N MINAG CROP STILL NEEDED IS REPORTING SYSTEM ESTABLISHED A bETTt,", I, WLE HAVE Ab A PERMANENT FUNCI.,;,',. OVER PAST MONTH REEN WORKING CLUSELY oITH

UNCLASSIFIEO , x....>D" e h. ,,, .* ,,. "C, ... .

.:'.

UNCLASSIFIED 97b3

PAflE 1 ADDIS t1480 03 OF o3 2410'19Z

ACTION / 59

, NFQ OLT 1 AF-O5 IGA-o2 LB-05 CJAE-0 bWFV2 6 V jtoMq'

...... - - - 2b47 P P40b~b7 SEP 74 FM AMEMbASSy ADD!5 ABABA TU SFCsrATF WASHDC PRIONIFY I2o2

IIN'LAS SFCTION 3 OF AFIS AbAbA 1I480/3 AlnAC 'FTHIOPIA COV .RNMENT AND ?JV U1 TO DEVELOP R&R PRDJELT IH) PL,.,4T WHF'RF DIUIJRSEMENTS CAN CUMMENCE IMMFOIATLLY UPON AID/W APPkWVAL. ;nF PAD, WE ARL CONSIDt. ,y FURTHER ALONG IN THIS REGARD THAN Wri N PAAD SUFlMITTED AND %,RIENTLY HAVE PROJECTS REQUIRING A TOTAL. nP US$4,000 ,0 NEA,-LY READY TO GO IN SURFACE WATER DLVELUP­ mENT, CqfP PRUTECTION AND RURAL ROADS. OTHEH PROJECTS IN UPUUND WATER PLSUURC. )EVELOPHENT, SMALL-SCALE SOIL LONSERVAIION AND PERETTLEILNJT TOTALLING APPROXIMATELY 5I MILLION WILL SOON Bt Rt ADY , iAAD Ar'PtOV? L THUS REQUIRED 5OONEST. TIT. A7, AID/W AWARE, PA DO AS SUBMITTED NAb PRtPARED EXTENbTVLY qtLYIsG ON SAmELIAN " LUE 3OOK" MODEL AND ON ASbUHA'NCuS TriAT nIVEN THE ,ATvRE AND 'AUNITODL OF THE PRODLLm THE Si3, * E STVFN HIWOULO AI)TONOMY .NFr FLFXIBILTY TU HF I{W PROPOSALS , 1 R&R 'fOR ruNOINd AND TJ APPRUVE/IDSAPPHOVF UING AS LUIOANLc RkOAD POLI"Y GUIDELINES LAID UONN IN THE L.E6IbLATION AS TNYEPPPLTEn OH CLAPIFcD 'lY AIU/A. THF TONt AND NATURE Ok THrL OU) STIfNS/TSSUFS RAISLO IN ,EF A APPFAP TO iNDICATE THAT LI!HtP ?HF GROUND t't;LFS HAVE 'FF, CHANGED OR THAT ilF YHF HAVE MISINTL'-RETt.r THRUST OF THE BUREAU'b THINKING nN HO9 bE6T TO ORUAN T4 MANAGe. ' AND TH, AID RESPONSE Tj THE ETHIOPIAN DROUGHT. W LON31TETLJ[T .A NOW FULLY-STAFFED MISS!jN MAINTAINING CLOSE WATLH OVEk A ,DIFFICULT SITUATION DURINU A PERIOD nF POLITICAL TPANSITIUT, I'- PTHIOPIA. rIV.N THE TIME LIMITS WITHIN WHICH THL kR& PROGRAM MU.ST SUCCEED iE MUST, IN OUR VItW, BF ALLOWED TO USE UUR OF!T jUnGEMENT HERE IN THE FIELD, TO APPROVE PROPO.ALS FUR FUNUING, TRANSFER FUNDS TO FROUH ONE CATEGORy TO ANOTHLR, AND bETWEEN THL RgR ANnl RELIEF COMPONENTS OF THE FULL APPROPRIATION, THE ADDED RUROEN OF DEVELOPING APPROPRIATE DOCUMENTATION FOk AID/W

UNCLASSIFIED , Department of State

UNCLAS8IFIEO PArE 02 ADDIS 11480 03 OF 03 241019Z APPROVALS OF THESE PROCESSES IS SIMPLY POWER WHICH SHOULD WASTEFUL OF MISSION OTHERWIsE BE DEVOTED MAN. AND IMPLEMENTATION TO REVIEW, APPROVAl. OF THE R&R TV. SEPTEL WILL PROVIDE PROGRAM, MORE SPECIfIC JUSTIFICATION PRnCUREMENT WAIVERS. FCR Aij Ve HOPE THAT ABOVE CONSTITUTES USEFUL PAAO OE APPROPRIATELY EXCHANGE AND REC'ILST AMENDED AND THAT SPEEDED THROUGH THE APPROVAL PROCESS WITH Rl:, ;. ALL POSSIBLE VISPATCH, WYMAN

UNCLASSIFIED Department of State

UNCLASSIFIED 1708 *2 i '65s9

, AF-,,5 IA-Q SR,.,2 ORM,.1 CIAEs,00 EB"05 *082

. R/EqA. OrYLKF:DM8 ._,J, 'A:DRRnlWN 'I".:: " ,," :' 7.iUt "q0 N , , . !'*.7 IINFn fRr PHA PA PPC 4 EYSEC FSR AGRIC CT7 A ., ,NSC r,e.S H ., " - -1. 6 6 6 P ...... -...... 05721 4

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' ' . ' *.,, AnDfYS ARARA PRIORITY "")0 Y I,9 A,I.RR0' I 6 ,8 Q BEST AVAILABLE COPy

NAIPORI FnR REOSO

., j C'" ;'I'W4PTA RFCnVFRY AND REHARILITATION PROGRAM

- 1; D;.-D 8-15 (9) TOAID A-64 CC) ADOIS Q872

i, ** ,. PRnJECT OMMTTTEE MET TO CrNSIDER R AND P AAD "'. "'. REVTEW rONFIRMEn REPInUqNESS SITUATION v nRnUGHT ANn TT GENFRALLY ArREED REFS A AjD T I FEVEj OF RFSOURCFS FfR OPOUGHT ASSTS7AN.F Io~'T_, ; :rlGRAItED. PROJECT COMMITTEE ALSO FOUNrt PAAD RA T.U " .'vTE;: AT PAGF 51 UEFUL FOP nEFINING RAN E ,'Jr 0'm r .) *'q TH RErARD rO1LJGHT A.STSTANjCE ANf) :N CA-F­ :" : LflEQ" jS Fnp ASSI(nNMENT OF ASSIS TANrE LF,,; EI:,I ,,i P n JErTTVFS, HOWEVEPP IN.ImFFIC1FN':Lv DE­ - LATF0 TO nROUSHT SITUATTON AS CURRENTLY PFR ";K9PnRTAUTHnRYZATTON R ANr) R PROGRAMS AS SUCH .' LFVF> '-l ON RASIS PAAD AS MRAFTErn SOML SUIPPLF-. 'F'-T4'-,.'.. ,'S.S PEDUTRFD AND LINKAGE TO PROJECT ; , PRnPOSALS 'E JC'Fr C.hMITTEE COMMENT ON RELIFF ACTIVITIES

IiNCLASSIFIFD Department of State

'JNCLASSP~rD

SEND S1UMMARY',

W~:ThR~ PART ITC.,AT PAGE ?N; REOQiET I4ISSIMN Mfl~*~:: DFNF PROGRAM OBJECTYVF6 WHICH FORM RAS E~rY A'110 RFLATF SAME Tn MROU'HT 5 TUA'r7ON AS3 PPn,FP5Fo ARErAS OF CONCERN AO , AT TNflIVMUAL - U4KT(STHEN CAk BE SH~OWN CLEARLY 70 SUPPOiRT ~~~LrFTIE%ry*ciL-r WHTLF CRITFRIA OUTLINEO) AT A r, 'I:RE USEFUL. Tfl IEG/USAYD IN AGREEING UPON -TvTTYES TO b FINANC'ED AS PAPTr WAND R -,iFR-iA P NOT SUFFTCTEIJT Ti DEFNL SRA-EGY; VpRt.TTFYCA~yO,\l PROPOSPD SELTOR ~ ELEM ' NTS R AND Tr~ ALPFroNT )OL S 8 MTI-l 11Th kc*UIPEmEN'S FSTI=_ A Y- <9 P ACTYT',:,ESq OUYLYNE CONITAINEID tT p A A. .:7onUrTjoN, PAGF T! LfnuJL. CLEARLY 8F qUI 'AbLE STAR7TNr, ArH A~iAy.lr. ALJHUGH THOSE CIRJECT:VES MIGHY * *7Nv~D BE YO NATIIRF OF PROBLE'M ITSF'LY Tfl THE - ~ b,"fl FIiA,-LY TO PROPOSED ACYIVITiE3 'HFM­ -/-SJYONGPESSTONAL - PR SFNYAYIONS WITH RE :":' 0 PIATToMF ARI" H~TC1LIGHT NFCPSS:Ty FOR~ GPEATER PRE.­ -~~T":ING- NAT;.PF nF~ PPOPLPfM BEING~ ADDRESSED AND MJ t(.lTTV;:5 VY5-A-VY5 STATEn) PRO8BEM,

* ~ ~ C~~~ ~fJcL R~ELIFVPS AID HH~E PPEPAREr) -m'uw RCn~MENDATTON YHaT U,,'3. RErOVLP -44 Or ,' AND FC TI iE PRE LARrEL. ' CONFINEi_ -1C SOUTH V; 'I* SYI~IA-r ITS TmPAerT Ox, ruPRR 5 H T 0 ply 5TIA7TMN AND L,-vFL (IF 7Y 1E'NAYIN. ANfl TTFQ 7. RELIFV! S0"E GRE4TER DES7RT -'InN R? P l.r5T 1)L '4 LL, T , PP0v I F 5 4 ND 1EG,,OY7iE R SPEvPONCE TP PEr'uIRFmFNTS SwOUL RE CON7A7NFL y* PgAr) ZrnJ~T illIcsST00N CAALP TH7T, 1jF.ThRMATTON FnR RFVT- N T IC 9 *T AT PAGE 2P, r~~~y WHYLF PRnJPC O4M7e WILLING SUPPnRY ~:''.~ TW-AT 'KS RCnVFRY AND Rb.WABILITA-TON O FC­ .:F rCn'1PNNEn TO SnUTH, AND WHILE APPRF:IA-E r~j .~'~r~'~ ON NMTIJRF/T~mPLTCATT'ONS IN 50,.-4 BFa. * - : rnlc 4 AL, OCATIrIN DO~LS A M ILL YON NE ES577A-FS '.~ i O ~.'LOYNRETTFR LIJRSAr)N

-, 'N~LAqFF / .. -Department ~TELEGRAM of State

LINCLASSIpFIFO $"'", -;': ATE cop v . .. A;N"N IN SOUTH INCLIIDE POSSYBLE DVTERID r: IFWHICH' r~;. AGGRAVATFS ATI N. ""... DROIiH7 VULNERABILIVy ''7TTEF STRONGLY RECOMMENDS TF "PORTTON THAT MISSION CONSIDER OF RFSOUPCFS TO RESEARCH nf3EM AS MANIFFS'rEO AND STUfOY OF rA'' ; IN SOUYH AND POSSIBLF -"-1, .Ory Tn ITS RESOLUTION. APP!. Y- PROJECT COMMITTFE :ISAOTPR WATCH AS 3PECTFTC REQUIREMENT MTSS N .(tSF. ELFMFNTS COULD '.iPRQOVEr WEATHER INCLUOE CROP REPORTING/ €r.Ji]J-, '1AR T ;YJNFORMATYON REPOPTIN/FORECASTING, EXCH.N;ES HEALTH/NUTRITYON EX- q!JVF' N'~ E F T r., q OMF PJEiFPN EXPRESSED THAT oPPF4R HEALTH/NUJTRITION OLD -P :DART R & R PPOGRAMo N T i.PEAY 40RFSsINpG APE IFG AND OTHER DONORS THESE CONCERNS? HISSTON 7HFRF R, .2[rCANT CONGRESSIONAL SHOULD BE AWARE F ,;TV: PIrRfTY CONCFRN THESE REGUTREMENTS ATrENTION, CONTTNIHEn qUPPORT CDC ANO YEN BASFLTNE WORK PPO8ABLY ALSO CRITICAL TO ., , REnlITARLF POSTURE/FRnGPAL FOR US, R AND R :"TSS~1"14: FIND IT USEFUL -.F "S OF S1EK FUNUYNG FOR DIFFRENT P AN; R PRriGRAH SEQUENI PR'.r;ir5 A,"D RR-oQlIRE1ENTS LLY AS PROGPAMMINr ,TH IDENTIFIFO. IN THIS ,.F. ; Q0 iLn CTRrUM. APPR(nVF YNITITA TRANCHP - v,;' ~-;" FTLFMENT T) MEET# FOR nlB3E1CYIVeS WyTH FUNDS PdSERVED FOR ...... r IV-S BUT H;'Ln PENDIN, Pi.OGRA4 ELABORATION/ 7,. R f.-r - MI STON qjnUL BE ABLE PROVIrE lU7Ft) F :R 2.,AAfn INFORMATION RF, PRIOR qNYDqR ARRYVAL. TIMELY RESPONSE ' .TNAL WYLL REVTEw ANn APPR VAL R AND R PROGRAM, R. " .'., GInANCF RETN; COPIED USAIO FOR YOUR YNFORMA. "," r. '"S,:NGFR

UINCLASSIFIED . :~..~~~~- ... '3 " .3 4 '. ' .. c , ,

- ! "____ ' ­ -

PROJ=C REVIEW PAPER _

Fiscal Year Proposed Ffnanc4 ng: FY 1975 Appropriation Category: Selected Developmrnt Problems SDate of Submission to Rureau: Nov. 8, 1974 Pr ject Development Team: 1) Roderick F. MacDonald, USAID Engineer 2) Larry Crandall. USAID Program Officer 3) Robert nell, REDSO Loan Officer 4) Jesse Snyder, USAID'DRD Chief

1. Project Priority and Relevance

The vast wjority of Ethiopia's rurF1 population is not sered by the present road syatem, with as few as 25 percent of these people within haIf-m-day's walk of a riVA. Development in the transport sector thus f.r has been focused on primary And secondary road construction,, with little having been done to provide the inter-connecting capi llary or local roads, The drought has nvdo the itibalnce of this aituitjon acutely -rpparent by demonstriting the Government's Inobility to rench many of the affected .re& with food ind supplies by any means other then air-drops.

If the recovery and rehabilitatiGn elfart is to succeed, these areas must be served by grtind routes -.ver which supplies and services, including food, medicine zind technicti assistance, can be brought in &t reasontbl, cost. The construction of low-cost, minimum standhard roads ia considered the ,ost fetsible means of providing this renuired access on 4 timely b,-as for recovery and rehabilitation. At the same time, construction of these voacln will represent a stop forrard in the integrAtion of thc.;3 arro into thf% nitionhl economy by providing them with access to rnd from AiAtrietr.

In conformince ,,Ith USAID/thjopia's t ,jproved AP, one of the m jor reasons for supporting ectivities of this type is the possibility of spill-over effects they cen hive beyond those imredi to nreas con­ corned, i.e., by demonstret .nvhat ciin be done (the technology Hnd techniques by ,,hich rurml rovds can ba constructedI and zalntainrd and ho the costs can be la-tliy financed). naay then Also m1tke it easier for the GOE to provulgatj, #n pproprate nat onl rural roads policy. Helping the GOE t, bring about important changes of this type is thus a mrjor spin-off of R&R ru.l assistance.

II. Grantee/AdministrAting Agoncy/Ir.)lemeati ng Agency

The proposed construction of rural ronds rill he Ln activity under the _covery and Rehabilitation Grant to the Government of Ethiopla (GE). Adminstrative support fo4 tits as weli Sa SI other grant activities will be provided by the GO's Recovery and Rehabilitation oomi 81son (EEC).

7;, 2

The RAC established at Cabi net leval In April 1074, Is empo~wered to receive Mn MUMin di-o6~ugt pv~r-n e' 61oestic aind externt!. assistace, IMPU~e1Ofl 'a of~C th plogrark ill be the resitan;bility of' the Eth1iopianv H pghvf.y Authori ty (EllA) vhl ch iili performn the ccrstructin by foi ucu

uCI.scription of Project

'Ji5C TRCI rcf,1 ct>' MtL L. oficats. in provi dinKi tccess roads bc eoncen-;-toail i.~~ Oi.I ics of~ Cv.'u Gof1', Si rkiwo Ignd T :Th The fahXoi'i PMY~ iu. have be:)n inentl i d by the flurni Moids MR Meoe "t M?. Toy' construct ion under tho A\ID MRh~grent:

(1) Arbc, Vlach -~ Uoi:s -j iih,0 -. 5 2LI min -. Imi.

Rod- 160 Ron, (3) &1t - Me - El it -,237 h'~n

oZ thasu parK:tiar rca tutl*l ' " !r-'1L'~~f: cation~ CY a.20~.Lnsk 34 OM Manad~.2. bj thz aicui'4 slled

Tixe~a ruta v ar oziginll pr~ay by 0 Lsi fny vppnM' by

1 oruiz~ian no etebiahea1r to c:saia ull rural read~ccun~­

ukucklacn Mh ilhoui; Ethiopia, nodl' i;! b.-'i":fln I the M OM~;i. of Public 'JorL . tobvh Lp :r*nc. . tivcic f~a varivus v:inirstriewi =w p~ugiva by ~i~*

MLen th raque~st U;~n ::CeCOiMv 70 tha Qn ;0.1xtplan by the~ RHC' tio1 Rural UJ Tau%y :.3cw )VC .;y' .)d w vn.Li S to tudyUld t vat o vaut t.ihylv irm.znt .n Meut zcoviot~~ M'~ bi rk Mislo

sit the ruat d by1tdevO foroiOit~ui '~or~ h ir'k

MZn Virz !on~v;o& rvod dronjti~e ~ nructinQuj~tEhon. Th

HOC&'aboXo l'2.Provie whichfw Fito o Val bywand~oe dored.t The. roads, proposed in this paper iare or will be added to the national -raneport- plnn for futur cori.truction-to-primary route standards, Although now listed as "twcks" these roads are virtually Impassable even in the dry vanson sind then they a"e only ptissablo to 4dwheel drive heavy duty vehicles0 Under no criteria are they ouitable for h~uling grain mnd other relief services and suppliex. Zn s.p'te o this, ronoz 4.vhoeo drive flat bed tr nsport: has been "forcb",' over the aoui.es during the dry season. The coft of maintt.ining vehicles e;qosed to this abuse his been inodinste. The vehiScles used on thea roads have been available for emergoncy hauling only k sz 'l perceneoge of the time since they have frequently been deaclined for repzir.

Faced with a situation of emzAgency need and virtually no access, varions organisations have attempted to gly zome emergency mterials into i4mine ireas,, This pr.coduro wes re1itively uunuccossful due to tho goneral lack of even rudimentnry oir flelda In most of the affected areas and was aluo du to Inch of available transport air­ craft where airport facilitieo were ail able.. Noty:ithntuding all this, air transport obviously Cannot be uaad for effective rehabili­ twtion prograneu. If steti!ed i.nadiately the routes will have not only a reh i.itation impact but can nlso prcvide emergency well EFIA ii propared to, rnn is in fact, cc1m.noinz with mob' iza­ tion at the tim of -thiswritltg. Tht. coutjzuction seton hms begun (comonsuratu vith the ons t c.4 th , dry i. ncn) and it is imperative thct construclion proceed quickly . l; to utilize as much of the coaztruction rsetson wus pinobuib1'i0

Supervision t.f tho iactivity ic a hoy item fo aiuce ful Implement&­ tion given the tight financitl and time constraints. (see atteched ie~g Frtrmr Bltocks C3,2wn D,,2),,

One o.priencod expatriate in nza in.-ciu-ry to buporviso the Arba Hinch -, X( nxo Djinlz roL.d construction,, Thio is the Host difficult ol the lour rotdo and the niieW for hiz se.evices wra obvious, on­ struction superintondentB haw beon s c'-onded ftram EFA personnel for the othor throe "outes,, Construction progress will be monitored c',oly by the RltC, MIA& USAID during tho initiil *azev and if it is not dvitisfactory, the RIC rid ENA have agreed to ;ke immediate mepl.nt-int of the unsatisfactory superlalendents to issure complete construction within the praooatd schedule,

ESA vill =kv 4 vai2ablo hbulin, qu:lpp.rnt to prceeA with construe­ tion until the units to be purchseed under thisavctlvity are on site., (oiis can be done for a short period by using road maintenancoe trucks). Sov attachment C for equipment required for purchase under this progray. TIP ''M " " , I'', " " .' ... 4 ,

The nagnitude of output inlliatars in Block 0.2 of 'the logical--~ U fmmworkwa'k e'flect probable diffi~culties of c onstrue-. ' tion on certain routes. l~xtamu production ,ppenra in thie 4' secondgsix months of the prograu,, Tit i thirdIsix mo.ths period 4 will be on difficult torm in (wck, ete'), Vhis will L.llow maximnum .accs at the end of your one, %nd year two will be utilized to fully stabilize the route and accomplish the most

difficult portions of the .con.struction, i, conorete fordo, WeMMWen drainage, etc, The roads will be constructod with c lbor-intousive (3600 people) and equipment, i.e., labor intensive to provido a means of finan­ caml flow teo those oblo to work, tnd squipm.nt to rapidly push through the initial route construzticn and thuw provide for dolivery of relief supplies to th" zin=ble to xmiutain their health duvirg the femino pnrld.

MiA io providing from their exinting suipiant the :zollowing:

A., 3 doeers 2, 4 gr~ders 3. Rollers 4a required 4, Farm tractors to pull rol.rrs (itc 0 nbZt ) 5,, Compressors and drills for roc- vor, , Logistic hauling eluipm n- ineludin2; low 1, ds vnd carrier trucks 7., 11 pick-up trucks t., Camp oquipmnvt including houso trailv-rs, gaertora and other suppart cquipiemnt D0 Lubrication equipmont for serv:lcing proj1ct equipent "O,, Back-up minteanco suppo7.it frum dietrict shops "iT., Other qacsafnry equipzent to cnstruct t in projoct IV, 2 tfio citry

TLo arem to be serviced under the prolped ,cnst-uction will pro­ vLde, at W.ninuu cost, access to ir twliately deliver life sustaining nutrionts, Wter and recovery rind rvhbilltation services (thus pre­ vantiog furthor loss of life).,

By providing means whereby AM go s und sorvices can be delivered to af: eeted Areza, the roads will also help pravent congregation of drought naZected r~ople IryIon their mrual babitats thus allowing th:x to continuo to. .arn, i intain the livestock still aveiluble, and otbtsrwiae take advantage of every opportunity to re-establish themselves. The roads will also provide increased nacess to the Ethiopian econoz so that available technology, water develolment equipuent and seeds xrd fertilizors can be delivered to f..sitit not only their rohabilitction from the drought/femine but Asmist alao In their general economic doveloluent *a well.

-nl~, 'q 14 Li ll 4'. fr - . _ . • - _ . -

the road cotr heeo expected to ioediately benefit nrom tion are as followl: persons Arb iVnch 1CJOU00 1OinkA 240,001) 500 000 1 Ginnir - jai ..' Godo -El itaro roads Iecele - mega 200:*000

for 'lhego tire the populace reported to be 1.n sin ftittldtO need

o helRth and,1 itiofta a0eiItUUiO t uvndeth 9u'ote0V wlos V. Other Donor COrdination

tVohKough i npleNSXtho j'he q.vlc will itmCrain the role of coordintor through be bccomplifshed by the M. l an is will flo tion is to will flow the HU'C to EH& and reports requ~ired nder the pr'oject from FMA through RRC to USAI., in being 'the Prm of road construtction lon the vloIA'z. .Tigre eireas ar bin ticcomplishedtruhth C nd ane h pi-.vot acquired the financed and implemented by thei doniors, the MW Ix as work in those uervices of the Crown Aent to pliin aind coordxi.rJ;O the donors., alvias. Roads are being coastreted~ by the foVloviing

I., Stern Mag2zlne " Uiteda Ki-%don 3. IDA/IDRD •1. G ixmnGovernment 3,. Terre dos Howms roads in that era*. 'lia Livostock nnd Moat Board is co.,tru ' in, all robd construe­ !?.rladic rotings are he..d by TIR'rF to coardin-4te with all donors :Ion under the R&R work prograi, tIAditional uxating and rehabilita- uzre hold =.ontbly by ths FRC to coordinato the reLief

Vi, '1riunolalRequirements the basis 'rhe followiug preliminary iflncial plan wns -propred on roads. of unit costs derived from acn qlo budgets for two of the four It in Thass ,it conts were then projected for the %:otmlproject. lrbor costs and 40 per­ proposed thut the GOB bear 50 pereont of dny existing cent of POL charges as well a bear the coest -3f owning roads pro-, iaquipmnt nd salaries of EHA staff assigned -to the rural ,iect. The finnriuie-nl pl.:.u icilovs u;Int t0IG'to uRccash

the 'gnn'

0 ~pc er2 cost±:~

CIfiIC1 lT Crun, ~ulilJ TotvIl

ro t c.k i.:, tI, 3fi 1. 151 as,~0

C5 10'iL, 03401!ii A 1. P,5.

V"quiinC..cit OpeI.CLcors 490,5 -- 490 .5

iric1d.g~i:c~ 26 7 ,8 267.8 IM id Tck1 &i up3e

A~ ,~~&;.)~126,,0 126.0

-:ijsIon 2r() .8a 20T.8

:Y1dS.- 2414,0 744,0 F''!1 c i.pii 14.4 14A4 Diy L2 648,.0 648LO 1 296.0

'~'Rectli-roM. 2,451,1i 232, 3, 6d 3, 2

E~iwc~i.: ~ ~.;.;c r 2 *yx'I ;,arvice vmie bmined an

* Dons in't incltrdu imcn-c. h ch~ircgca laz rudinintrttive support to be prcA'id.- by nafl C~A~in($18,000) aind Provinciml Governmonts ($10,000)

ELT"Uivalmlu'- 1.0 "0% or ltttL c~v th1et pur,4icm k~aresnteI by trieu., '4,~

- .4 .. " : ! , " '. ­ " : '-, " - , i :>: { ....4','/

Total Capitul and 38211881 ,6~ Recurrnt 38, .8, 5..68'6 Contingency 20% 760.,,4 371. 1l33,,7

4,52~52P239,8 6,802,3

VII. roject Developzent Schedulo

Since mobilization has rlreudy staneJ em -the !!ur routes, the pro­ ject will connene gs son as funds IIIe =de nv ilbl,, The first six months of the project wilT. shtyn loos thzn 1'5% completed since equipment to be procured will not immAidlit~ly bo ovailable to the project,, The project will, huveva,?, be completd within the 2-year period und the effects of tccass un the arems vll be roalized after 48 months. The finel 6 month-,period vill be utilized in stabiliu­ tion and finul drdinsge construction,, Tis rindl intage is necesnary to minimizo the adverse environmenrl ef!ect of the rosd construction,, For t more completo lyout of product:.n ach' dues, see Block D.2 of the loiticl framework nttiched.,

VII1 Further Anzlymiv

Any Zurtho. A yit/detai1v -.,ill be IncluJail in the proposal docu­ rontattion un-J impleatnat ion tigremanta..

=I AJids Aob IMLD A 64~U~isI I )e i"

417rX L

157y).1So )4 X0 transport~ reliee suppliec;

aucn1~erpense ifor oiieiters'

retAzznod ('ro-o Adlis to juassie, L4 )t373.28 Gasinei exponii and per dien I-Opr psir, Ur0opers Yriiu_ in, 31Io, Provimne Per die3 for betalta off'icers 62 )33).) Gasolir~e Oxpeoce SiJara23 37J. 6) POY.ent Vor rrnin .r)ubmportation

B~ Ie 159,~ 41. )3 ~A L t tr i .po relie. supplie s~ ikar;e 1,)))Arount paid Zor -rain U-rmnport

3~)*J)AMrozjL paid i'or w-Naeiouse reint 22). )) Salarien pid for gurds rtre2)) )) *)3P!, ')nt for the rele. onu rehiti~t.0tion PMrn Ja

00 1 Jj D 71). DAmuzit paid to rurunaport relic. qgppjies P ;-~r~ .J).) AnIDWIL peid to transport Of:i'lce LiUrni- WM froan lafl to Ajk.1in Grain Corporation 7, 76i.7) LOWdlzr ani twLaln eiqne 77).3)) ror purctlae Oi 'o

UNC&SL-'iF AJdis Ababa 'MID A 6 I-r UTi, D ["O Eth. $

EMU 3)), X)).y) For te construction oi, EPID storl;,e 2, 3)), 33).33 For the purchase and distrLbuton of seeds an. 'Oro oxen ,bsvold 2,353.5)] For puzwcbae o-" i ,: raph machine OJj pra ,, 5-7. 5 kor purchase o' photocopyin naciine HSI bouodation 65,233.33 lo cover expnses of orphana-e progrnm Central Laboratory 1,923.73 For purchase of drugs Olivetti 1,463.3) For pur hase of elculating .mcnire Ip32.)3 e'or purchane of V.,ewriters Individuals 537.69 Salaries paid to drivers, Janitors and waserkjers Students 255.35 Expense paid to 3 students -,o wenL to k elie for National reliei' vnr Baoni '.4 Aount paid for purchase of' b.RnK Cdeques

53J.23 Service charre fiellef & fletib. Offlee ,,35).33 Running cost of t3 Reliet ind _ Rehabilitatio Cozaission

TOT1AL Eth. $3,141,) 7.73.

Source: IEG R~dI Comission

*Note: rese funds rere largely froi donor oontributios.

UNCLASSIFI AIDXl A-64 I6AIFInI Or

S.. GOVMZM.V ASSISTAICE

FY~-~1~77-e573P. L. 4Wic Food 'rr Wheat and 45 MT Nonfat Dry 11L Cost includin,- Trnnsportation C--t t AID 0 '5,150 'Y1-74 - 2,'W AT Cr; L60C(, ,T Meat, Sor,,ht:; Corn and 30,000 MT Con; Cost Includin, Transpor rtat in 14tilo3 ,­ 14,i I-VVuc 12/3/73 Ambassador 475557,7 150 's Disaster Relief Autbrity 25,0(k T.y taro U .s. 12/3/73 FMRC O..-erations Officer 1/16/74 , 1,800 CDC Doctor for nutritional survey and health requirements 4/1B/74 Doctor from CDC 10,000 3/22/74 Tran port Tear: 35(0 5/J4/74 S rveyAssesar 4,400 ent Team 7,200 6/17/74 Extension Survey/Assessment 6 /2/74 Corm Tes_ 12,5o 4 ,.;nicatIons Tea-, C..'27/7 Food for Peace Teat. 6,,600 7O .55,450 11edical St!1ies 51/74 Local Purchase 5/21/74 Medical suppliesof medicines 10,000 __0,00. 110,CCO Shelter, blan etsglothln /23/74 Local Iprocurer-ent Cotton Cloth 4,/18V4 10,000 15,000 blankets and airlit 3,7k 5/3/74 Cash to Red Cross for 4/2/74 400 tires and blarLets 100,000 polyvijgl sheeting 179,6o0 6/21l/74 Polyvinyl, tents, bnit. -- 2501000 3 SP.cial .[Ui xen and Sp. .O 1/16/74 Local p.rchnse ,alvani-=vd 3/26/74 sheetia, 759,00 Galvanized aheotinG for 50 tional storage units addl­ 112. i0;,5OC 3/lt/74 Insecticides and dusters (66 t.?r of T) , 5/24/174 DDT Dlendi6Up 1229c wUzAS~M~ ADDIS ATM TOAID A-6 4 CISSIFIIMO

AMC ;?

S~~ia1.J~jvij,)ent an S4 Cient~d)

4/23/74 500 Tubes, ,0xowu; 2,u 5/3/74 3 - 5,000 gallon tmtow taW.,a 33971U5

Z~r32 Ikk c'ptpro±. Tc Cota 2./12/74 Paid transport f-r Church World Service for 20,000 pounds~ of'food $1,025 2/13/74 Paid transport foR r.Odlcal Assistance Procrmam for 573,400 pounds of food 76,200 5/3/74 Provided cash to Ui1M to airlift 25 Fiat trucis 145,000 6/28/74 Provided cash to UIZ2 to airlift 20 vehicles 100,000 5/30/74 Paid ocean frei:ht for CV3 water tas 3,600 6/7/74 Paid ocean freig-ht far MNP rmodicines 610 6/7/74 Paid ocean froi()it for 73,200 pouzzd CM'S nonfat dry mill. 6,750 $333,1 5

2/26/74 Leasing vehicle for uo CDC expert 1,800

4/10/74 Air transport of tires and vinyl 58,000

4/1o/74 Diversion of SS Garfiold and 25 trucks 298,500

5/3/74 Hlicopter support - 5 weeks 40ooc"

5/3/74 Subsidizing in-country truck rates 200,000

5/29/74 Air transportation for medicinee 68,000

6/7/74 Local purchase 4 each -weel drive vehicles 44,000 i,403.4f,5

Total non-food assistance 2,317,794

Total SG assstance $17, 7, 44

co,jr1i-i74 t5CTASZI1 :i~~~ iT- AL) -A64&j~!$cII.

(As ~13,~ -9-7~ IfA ~ A~'

JNDILP TeCLInioel Asuis tance 8c2, 74' shtttermg recoviery pro:rnw iNI l-olt~er rra tedals, plur 2, X 1 Land-Bwejr, 5 trucs, and1 tarPaulins procaired lonall&- Ond cix Uroin Giloes arnd 25 trucks pr'ooureJ in .,urope r,,aA1jj $5214,530--fL'co cmn­ tributiona listed under rDenmark, Notjerlan&o v~ UFP, Christian Aid, iekentschbax :;erk, and pdifol~e 'R411ICp Cas-, to N~tional PelfeP ' omj~ttee l,0

;Z ndcild-heal ~c~:cc rater-cfri111W- rige~ arxi £ood dis. T.rfQA3fl upt,, the cmi oV 1.)74 Cash to Ur;XC f'or procuremnen. of grain siloe and Luertricens 'v technician 15,, J) *-'Tr ain(,~7

Intena dictribution coc 2Z),

TOWa it 1.", t3

SOU.L'1ce: Cfl'Cee oC the Nntdtaticins Dijastev telie.' C-jtv1nm,--,r Genezre(.±i)

UNcIASSIFLD AJlS Abari)a TrY,.V)7 A 61 UJTAaFIL

(r,!auretio i 2f~ tT Value (:L.LCw 2. AE7G1TINw coprnment 1, 530 tow v-Ieat nof. reportci 3. AtJSMALIA

Governme~nt Carh to p-.cmicxe- Lani- Rovers4t7 Pr~tein-em'ichad birocul tc

red Croso CRSII 1 Urantc D 400 kas M2flkpower, c'er­ ziocec m=-diee.1 coordinaitor

Voluntir5! Ctah rakced ..y drOW hj A-enciec aPPeal (U.-S.M,137,.3l3)... A.C.F.C.A. disetributedI tO cem (Atuc cxuzllan Cat'lolje Pelief' Servicec, CCcAMc11 -r World Council ')f~ Churcheo, (%reraeac Aid) Red Croe, yj.cA, yl;CA, St. Vincent de Paul, FA,-, LrflIC..I, Soio8 th Cildren Funa, Lutl~ran Tlorld Federation, Bdp tit W'orld lielie 1,.137, 33 Aun tcare Cach to JJC~ ,5) Aus crallan Cash to Cat-i-zlic Jielle­ C001olic FelleC^ Serj'iooc -39,393 Catholic 7'elfare Cech MW T3 Wl 2, 44-3,209 4. ,,.s~ru

Gorernen t Cash to UNircEF7 Fad Croso tbldical taem not Lvporte

UNCAsifl A JcA!rbn- rAIV) A 61. L!~I'~

i.]cture of Asg5.stazxce V-2:lue JL)

Governnent 500 '? grain (ttur ?) tollwopa±r el fLed Crawso 2pM3 kGo botr~ocxd 539 kgo mdici!go and drugs, 20 towo milkcpxder, 13 tons foodstu~fra 52,-171 Voluntmry Ajencies

Towl (52,071 G. tA±

Movei'wn 4,330 to wha no t rep.it&-J Cch (tbru [ed CracC) 57,5003 Red Cross~ Cah grantz 10,942 Servieg or Meld del,,ate1 Voluntiry

ana Ponice (tbru Ccritani) Canb4- 3 Total 75,364 7. CHIDA

Fed Crnisc. direct to .d..p1,qn Goverznwnt 10,00 1' vheot

G,yei-,mn'Lt Cosh to UNIICEF 32.0, 3 Cah to UNIFC 41, 0' RedI Crocs Cah 709X. 9 to&iv i1icp"I3er 7,tp$59 Sev': ose p~'icerM m' rp-,r :..oJ Addis Ababa 1TCAID -A 65. URCLASSIFIED

4

IYFIpAR (Could) ?6Wzieo Aastnj

Voluntary Agencis DOW-ur~mid Cash Ltea ol e.3,9 Cash to IUUM World Fed. 30,000 2 ton blanmta, transport, 8 tom dtoal eutpp.l not reported Cash Mllvate 4,800 Danish Rotaz Club 1 too an1kpogar st M ts Total 9. FI LAD 505t,.47

Goverrmnt Cub to Red Crce. for pr.­ obease vehioles and medicine 39,267 Red Crc, - PenfaUllI tablet, 2 Toyota land eruisers & oth3raehifles, 1,000 blanlwto SerVIOW Bupp2 37,958 offloer 8,649 Voluntary Agenoiee Finnish State Church 0t SpeOltled

Total l4,7 10. FANCE Goerment S5,0000 UT O'NKLjS rI 3 halioopte, ntrpre Ito= not reported Dls-tltc roodstuffte

?rm AnW unite not reported

UNCLASSIMID Addis Ababa 1TAID -A 6#4 UNCLASSIID5 13

9ZERIMUM gNat=e 9L AI~MM aue(.S$ FRANCE (Cont'd) Red Crow. 34 W iins,rge 1 too bcdkfTod, OB4a1C Ks 1,268 Voluntary Agewiee CAMD h through aritas 4,797 Seooure catholique cas nuzgh Cui'taa 0000

Total 26,065 11. FEDERAL REPULIC

Goverment cash to FP for Pm'kah. 8,000 U Oereals 1.43,848 17 tmaks, purchwso dreust cacn, fafa, end fr wtation oosta 2,289,123 Cash to FAC for din-trib.. tlcn Czftom 1,11%108

Red Cro 15 to= infant food, 1,50 kgs ailkpodsr. 8,000 blesgets, 250 cpbedo, tente e7d m:dioal equipmnt 58,100 Serview of mad.tea ad delegte not rported Voluntary Agerwiw Brot fur dis

Caltas Cahb 322,249 Diakonisokba Coah rbr tarpaii to UNME Werk tr UtbM,od ,unai of CtUvrohee 14,O0 Mfairlift of 35 tow (fro EEC) 28,00 12,000 ww1en rip not reported

out' ulcz nr=D 171,429 Addie Ababa TCAID -A 64 UNCIASSIFID 6

HAtmue of AvaIBtlueUe

FR~O (CcntId)

Private Ertewivo iwnolud­ Stern irg intoerm tranaportation, Mmgtid nec, foodstuffs, mtion oi" telier oampe,etc. 7 Total 12,832,426 12. MEECE

Red Cross. Ccedmmed aMilk 472 Private (empl~ es CQah Chase Manhattan Bank) Food wd aM not reported

13. IMANJ

Red tCaswh 100,300

50 tow foodstufrs not reported 14. IAND

Goverment Cafh (thru Red Cross) 48tg0 2 tow milhpowder not reported

Red Cross Cash granta 54,951 VoluntM7 Agencles Ceah 2,93 Concern 1 dotor, 4 muses ot reported Freedo from Hunger Cbeh 48,674 Private don=-a C113

Total 154,827

ONCIASSIFIED Addis Ababa TCAID- A 6. tNCASSInIED 7

15. JAPAN Red Crcea Cash grante 46,333 Priv'ate kwi Spinning Co. Cash MOOZOO Tinneotned 40,00

Total 86,333 16. KENYAToa Goverawnt 10,000 tons Malzep 10 toM

17. REPUJBLIC CF KCI*A Mlpwe n rih U51 1O8rsnt Ifimcine 5,937

Goverment ca1t 19. LIBYA 1OOD Govorimnt oodeftuef, olothl,, and 20. blaa 1, 0JO, 000

Red C Cash 21. m 0 33,227 Red Cr3m Cu1 22. Ma 167 t Ch to Eth. Red crm cwhcaft toto MWjMF,UIM 9p4a 377,35878,740

UNCIASCSnIn Addle Ababa LTAID- A 64 UfCUMIM D

hmoof Aegjp tmS6 NEWMEANDS (Cont'd) Red Cros ka 15,467 Voluntary Agencles Netherlnad Cathollo Nlaalcn Cash Terre 58,408 des Hommw ilkxoa1 persowm (Netherlands) (2 doeto, 2 'nwaes) Total 628,,3W 23. NEW ZEALAND Governimnt Cash thru UNIU 74,184 Red Cross Cash gmnte 2,955 Seririocs mudco taem and Admina. OfiioeGo t reported Voluntary AgeGn-ies OCLO Cash thru UNICly 17, Cash thr Re Crow 35608 Mash thM Catholic Relief Services 34,774 St. Vincent Cv to Catholic Relerf de Paul eVioee

Total 192,911 24. IAY Government Cash thru Save the Children Fund Cash to UNC;r 44 90,528 Red Cross Cash 10, 2 Voluntary. ACemies NoRzeliT Cm progr0 Church t & M RelefTotal 1,0357,005 (1NCIASSMFED Addle Ababa MCAID -A 6UNMCASSIFID

25. PCLAND

Red CrossawM =-toap~~v1tzd 6r040 26. RCIMAIA

Goverwmt MGI&lnwp fbodatuffa 20J,000 Red Cros Uleawsuts, foodsatuftC

Total 68,628 27. SAUDI ARABIA

Gove2r' t cob 2,252,252 28. SWEDE

Oovez'mn Clb fr purchase seed grain 194,695 Cas fbr localprcemn fatfs and acam 238t,05 Cuh to Luitbran Uorld Fed. .19,04S 3,OO0 t=3 vat and treflght 833,333 fa r otrnlen =n 673,684 Red Cron. Cash gro~ 66,83 1.2 tm clotahig, 3,000 b to 8,789 SJrim of area ooordilmtor nt reported 2 Lea"Roam~, 2,000 blcnkta = Mg Total 2,145,607 29. SWITZERLAND

Govarnumt75 toci vfieat f'our thru IMP I00 tow WM, Lato u w . 233,333 Goverownt cud Red Cross Cub 16,181 Hed Cross Sewyjoo of seretar not reported

UNMXAS17iE Addis Ababa TCAID -A 6l4 UNCLOASSIFIED1) 3

S8flERTAND (Ccxt 'd) Private H96liWa j 1 helioopter and drilling machns, plus apare parts Total 30. IjAILD 249,514

Red CZoO. Ca.sh~1 31. UW15 GovermMant Foodsttft (timned beef and bisoulta) not reported

Govermemt 10 trwe and airlift not reported Cash for -rk program 6p7 5 tons babyCfod, 10 tow, Milkpciwdor 3 tons cmdiamnt, 2 tons blankete end freight Cash for short-term rabill2 tation Pogrm 500,000 Puruohaee and freight sf~loea63,063 6 grain Red Cross Cash 7,03 Ibdicl equpmmt71 v-03 dioa1 eqidpw#nt, vehicles, drugs 29,963 Red Cross badges and adicament. Medioal team t 2199orted Voluntary ChristianAgexlee To !JCDIC, Uiru WC( for Aid te"YaUI purchae 15,030 UMSpeOiCted relief program 267,68 Oxen Md seed program 57,737

LWM-ASSIFIED Addis Ababa CAID - f 64 UNCLASSIFIED 11

UNITED KIMMC (Cont'd) Help & Aged Cash tbru Caritas 15,029 Modica personne not reported CAFAaM '&tansive Program, incli4d icg cater Medical driling 'mite, feeding centers, etc. 397,475 Sare -the Ce9h plus dical por- Children Bounl Fund Anwml pledge 33,784 18,013 Soottish Catholic Internatlowl AID Fund Cash thru Oatholte Relief SOMIC4W 9,410 Society of Inter. national iseiona.ries 3 ater aell-dril1ing (Sudan Interior machines, Misaio) helG opters ftr 3 months, 3 =obile hospitas with 200 beds not reported Uedteal and ot,)er personnel, bi- airfitps end other ezpeWlturea on related drought projeoto 245,241 United Societor for the Pro. pagatlon of-the Gospel cash 5W~ War on Vant Cah plus milk powder 10,135 Cash pledged 57,737 Private Thomas de la Rue & Col Cash

Total 2,038,3"

UNCLASSIFIED Addls Ababe TCAID -A 6U UNCASSIFIED 12 1

UMAI~~t~gm NAtur. of' Aws taneevau MS3 33. YUCMAVIA

Red Cross lAnkts 1,562 Vo.untary Agenc Ls International Fund ;Mw4 rW Child' I tac babyfod not repouted 34. ZAIRE

Government cah 201,59 35. CITAS nWTE TwLLs Reived from Caritas mne"" and other organiza-. tim ($M78232)-..eee under individual dotare, Aus tria, (CAM,Beuit=, SeaDOnMrk, Cathliu), Frame Austalici Foderal Republic Of Grmmy Switzerland, United Kingdom (Help the Aged) League of Red Cross Societies Cash (from pooled tunds) 29,9 Lutberan World Federation Cash 340,03) Provision of"Oxen, seeds, tool, f£azl Self-eSupport equip ent, v 11-c1riltng, agicl tural axtensin, villgo roeds, distribution high~poin foods. Pro. veaon 140 tons m 1320 blankets, 3 4-ag-1 drive rehlclo, 7.2 tons midiolns 31z.l, 36 tons milk­ powder, 10,000 blan9sts and ftow 4-iftel drive vehicles S2539.000 '%ppt.'

UNICLASSPED Addis Ababa TC7AID -A."I UNCLA&5IMM~I

Natue o' ABaRtI~j 157 (Ccxt'd)

Piom. aid Iolo anid Tipre oov~rlv foodo seed, cattle

Total SwPODOo Wrld: Cowmil of Clumhebe CaUh (ferom various =Mr obiob..) 233p707

uxwmr.IrD ADIIS ABADA TLAI) A-64 UIXCA IFIED

,uoh - JuIY 31, 1)74 (Iu I Zrie Ton)

13 , "393 lop3} 3, 3

1 April 5,0 9,63 "3 1 ;.!-, 2,320 9,922 1.3 7,, j:)3 17,433 6.349

25 . 4,53 19,:332

I Jane 3,104 21,2Z9 : Jume 2,1) 19,196

15 Juno 3,935 15,272

22 June 3,769 14,1(1

.",July 4,542 12,427 14 Ju3,- 2,X2,

21 Jul.: 1,4)

31 Julv 3M 4,73-

Source: r mid,L Commnisimo (VerlfIed Jy JSAID monitoro)

MICJLASSIFILD d~ ?~3Q~J ~ .11Mio Z A 64.t ' c A 3 F~

T i~ ~ ~ r c1 123. ~ 7. T r?2 1,4 A~ l l 3 . 7 2 .12

Al l ,,ji -. J ... 2513 . 7pe oc0.~ l 4 . 9 n ~ n ~ o ' i ' c v

P -Paloti)ale*r~ &uree Centj.nil .Siab1ct.i~ Cf'-Ice, . T ic A TWe dasr ar'e booed l/J on thc !je .jOmi Semple I~wave

.:, 25 Julyr 1974 ANIOX

rt256 41- 17) 43 3 A~l l e 1-55755 -t 67 5, 1552

ftl __. __ i

4* Sowrftg LVerlal If~h"Sy Aut1brity

-25 3Aay .174 ThOwond hec c&reo U Food oro I

Peaaant 8,6 Cthe oropg and 2P980 1,220tMV44 'oommerao isi'l. 8 1010i lotaoCroppw0 310 201 5 040 ()610 39o41 450 410 980 ()(8) Fore tre, .3,20 Wasteland )o) 1,44011,230 4230 6,20 73 FZ 79940 ' (6) (69 TtlLw6P590 52,360 59p 920 20040 724270 l225,000 12,2 ' PdLta V e~Inra ~ a tar '~ ~ t' Crvato~ Cetor of 2 88 l has1edi beenby Used First ROUWfor toe~j Qyeal~ r~ S S z S ef a t r 1 CSC~ Cand g - D a r t mn t ofe be~e ' si nc th Su vey Ice eer 00onsMt1"09,rQk. O -._3yhsow ever ist" be--" t dat~ -1~th knm- Ustorou be stressed e ~ 1.Cn~ y c n~~ that aPopnLat.-r ,, 'all b qa e brtia e 1 h t n f Pm i i n end~de o d eIt o a sea ,j ra1a kemno.e e e r s r:elds P P 1 io er iz 8h t P' IYsca or P o , er- . etent~, ! ~~~~~~~ r ~ ~ r ar hOtographle aie tractor -~ -* ~ as~ mt[~' and o data andl Yield as~ s_ Othe crol-,ps a"n and t. ue. On CoCfee. All 25 Julv 1974 r~

AD4±0rbc Lio ToCA.164 J IFl '

TiAre Teauzre)Tcr)

i~i~iLuijn _Jo~l =ulhutw Iloa Be tmen (mnere and %Mintjl

C 7ed 212,947 67 239, Len td 54 ;,1 23,837 7 r6',431 Partly C'mved and Partly 14 R teda 31,3w 26 96t 2"'7 " 25 T:)&-,1 iya 133 Ten nt Pml&latlozm EM q&= of TotalhIrj1 Iu .on hurQ P2vulc tion ,410,33 2,01, 30) Tenan t PODalI tion

adol Pcot (mesrs and Past RentmsR 257,213)8,756 137 330,3X.,341, i.. To ta. 355,974 25 r,.71,"32 32.5 i):itri uti.n o2T-=imnes A dtn . .LJ'e o Pavint oCt Rent.

In Crop 90 In Cawa 4.5 In Crop and Coch 5 In Se-dieec 0.5 3 To ail 100 .Aa ~zriaution of' Hldfnac Aooordin ,

2 25 3 24 4 20 16 14 a. CL ssIFIZD 13 Hooltli F-et11rie 1v Projir2,e. 1)70 h-o-rie and Boope Heal r.i Heal th

Tig'me 25.7 32V .184 7 22 Pbekle (5) (322) W131.5 4 21' Doit .")92 8 13 (4) (216) " wo432 O 79 8,911 .441 66 Total:

A,/ M*bels In puoenti io are InoluWed in the data for the pro ,rime,

/ Drecuer Selc,,l..

o uceJ ±9 4 oE on, inoti- oi- F uji e Heal U~

25 July 1974 Addis Ababa YOI A 64 IICTUSIFI TWO

Countr ganiza tion cozuitwnt Arrivals UMICEF 4,00 CS 10 17-) NIC' 955 Faffa/Soy r'beat SIDA )55 6n3 Fea'a/Sw %beat 63 Various Do[ors 22) 5 Totals 4,234

Requiremant Committed Arrival a. 25) Distribution vehiales 199 b. 15 97 25-tonners 9 5 C. 53 _nd-rover type 30

Counytar/Orgnization CO2itme-t Arrival

MaA+ 8 423 23 U11 a 10 33 c 6 f'ed. 1 Republic of G raam a A34 17 UNDO b 4 . a 53 32 c EEC 1 1 a 23 . b 5 5 Totals 238 ll

+ Ideally 5-6 ton capacitY 4-veel drive veheles. 43 LS vechicles - include a number of lege vehIcles, uatr/f£ael taniws, and personnel carriers.

Source: R and R Comntision

(31 July 1E74)

ENCLASSILED Aldise Ababa MU&D A one~A~rf~1a

AN=x 1.)

(Available for djtibta or utill-atic b~y Ve"Nazmw ucot, 1md1udcg voluintar~y &"nay end otber =Zma~wo frc3M)

1Hqfretmnt 164, M) jr Comotted Arrival 1)J$1 )) CoumtryA/zganis~tion com~~i~twtArvi 1'4?P3M 23p~J33 W ILSAID 34,032 IKFNYA 33,333 1.2,3)2 13,33:) AUS1ItAI 4,3)2V33 EEC 25,0)2 15,232Y srM20=) 20303 CANAIA 14o3)343)

;'oll h1p's all* SIL a gaff& GaS jam 14,633 ':,d 1973 et 146 3, 345 ft 1,433 '), 22 =~~1974+ 17.,733 1727)) 1#503 2,632 2)) 63

Haag -Sidanm UriUV Gaoni (Jofa Deaetfr 1073 ).J) - 463 2)1) 1)74+ 4p,533 5,1-1 533 10572 Baloe of' 1)714 an'1alo eittow in oto~z'c, in port, or balzg discbarpe 7,.))) ir returned in port to Grain CyoLion In 1.)74 to rmi~iburm 1)73 bowzmnwdzp.

Ruiewit 23, 332 O=A~nittod ?, 35 Arrival 4,234

EEC 2, 523 M i, 3n EEC 1, 332 But ter 011

UNCASSIFlIED Attachment A to M.O. 1121.1 A CLASSIFICATIONIP NTL 10: 82) (--7-DEPARTMENT 9F STATE 1___1 ______AGENCY FOR - C -" my INTERNATIONAL DEVELOPMENT I'lIAO~t- , 3 CATEGORY PAAD PRCGRAM ASSISTANCE Cash Transfer APPROVAL DOCUMENT

August 15, 1974 5. T 0! 6. OCY CHANGE NO. N.A. S.o . OYS INCREASE N.A.

TO E TAKEN ofnOu,N.A. APPROVAL 9 HEDUESTED FOR COMMITMENT O. 10 A PROPIIIIATiON - ALLOTMENT $ 8,000,000

7, 1 IPE FUNDING 2. LOCAL CURRENCY ARRANGEMENT7 VI IESTIMATED DKLIVKRY 'UR8DIA YR NACNLISIL.4TY00 LOAN -JGRAN[-JINORMAL F1FORMAL NON9 I 9/1/74 - 9/1/76 PAiorutlr:zat' on DaL COMMODITIES FINANCED

Corimodities eligible for AID financin7 as set forth in Attachent A., M.O. 1454.3.1. AID Comodity Eligibility Listing

'"PERMITTr SOURCE E,STIMATED SOUCE

I.S. only. U S.. I. ,M.t,, FW.: Indusriali ed Countries: F,e World: Local­ ao,_Code 935 Other, Cde__ 335

'I. SUI,.MARY OESCRiPTiON The proposed assistance t.ovides supplementar,- financin, tD the T-' ia 1 Ethiop.Ln Goverr-ment (1EG) for the purpose of conducting im.ediate recovery and! reh.ibili­ tation activities designed to assist in mitigating or forestalling ei:er!ncv conditions created by the drought.

The program to be conducted by the Ir] Yi include raral road conz:tnicor., wt,, resources development, farmner resettle'nent and crop protection. These act: t­ reflect a ma,-nitude of recovery need wh-iich ?a-not presently be met governmen. L- the without external assistance. "he primary purpo;e 2f AIL a2§ntanc' will be to aupnent the capacity of the I-' to permit it to =de.-ao_ thes activities urgently required to deal iith its emergency conditions. Description of the proposed assistance. includLg backgroizd, analyszc, :trate - ard proposed irplementation mecha-ni,-n and "ianageent system for thi pram arr attached. For a more extensive treatment of the courntr. analysis consult the draft Ethiopia Development Assistance Prograrn (DAP) submitted to AID/W in April, 1974.

14l CLSARANCES OAT E 2C ACTIONO REG DP _-.______APPROVED nogSAPROv9 REG GC AA'PPC A'CONT AUTNORIZED SIGNATURE DATE AA PRR

AA' RRTTLE TABLE OF CONTENTS

Page No. I. Summary and Recommendations j

II. The Program 1 A. Background 1

Setting 1. 1 2. Resume of Current Drought Situat~cn 2 3. I.E.S. Response 5 4. U.S. Government Response 7 5. Other Donor,Response 10

B. Analysis 11

1. Economic Overview 11 2. The Agriculture Sector 12 3. Development Prospects 13 4. Constraints to Developmet 15 5. Economic Impact of the Drought 19 C. Strategy 21

1. Overview 21 2. Relief Assistance 21 3. Recovery and Rehabilitat on (RR) n2 4. Regular Program Response 29 D. Management and Procedures 33

1. Management 33 2. Procedures 34 3. Special Determinations 36

III. Annexes

A. Draft Grant Agreement

B. Draft Basic Implementation Letter

C. Draft Activity Implementation Letter I. SUMMARY AND ECOIMENDATIONS

A. Grantee: Imperial Ethiopian Government

B. Amount : $8,000,000 1 C. Description of Program: Program assistance to subvent Imperial Ethiopian Government recovery and rehabilitation activities. D. Purpose of Program: To assist the Imperial Ethiopian Government in mitigating a forestallini, emergency condition created by the drougrht. E. Background: The U S has already taken a leading part, with the international donor community, in helping to alleviate the immediate suffering of the peoples of the drought-affected areas. The program proposed herein is a second directed stage effort to recovery and rehabilitation objectives and is a furtherance of Section 639(A) (b) of the Foreign Assistance Act. F. Recommendation: That A.I.D. authorize $S,OD,000 for a Recovery and Rehabilitation Program in Ethiopia. INTRODPCION

The program described herein wou.'_d provide assistance to the Imperial Ethiopia Government ii meeting medium-term recovwry and rehabilitation requirements. The program is not designed to provide emergency relief, such as food supplies, which are already being provided by the international community--including A.I.D.-­ through established channels; nor is it designed to substantially diminish the impact of future droughts, a task which Nwill require heavy investments over a long period of time. Rather, the Program has the imediate obje,,tive of subventing affected Governments' efforts to undertake:

- activities in expectation of still another sub­ standard harvest, especially roead and transport improvement;

- recovery investments'to help farmers and livestock herders to get back on their feet and ex-tend the capacities of these people and governments to cope w'th their problems in the coming 12-24 months (including as eligible: irprovement in roads and other transport means to ssure effective distribution of inputs an4 marketing of next year's grain crops, development f increased surface water storage capacity anI to assure populace will be in place during the ne~t planting season and for the immediate protection f existing ltvesto'k herds, and educational and socia action programs required to assur'n the- populace is prepared to act as effectively as possible t:rough the next harvest); I - medium term programs to p~otect the fragile ecology in anticipation of longer-ter. developxre..nt programs (including as eligible: pfograms of water develop.ent, ranue management, grain p~oduction and storage, and possibly livestock diseasq control); and

- research into longer-term idevelopment programs (including consultants ana others required for the design of medium term programs plus support in developing approaches to longer-term planning).

ii Reauirements

The financial requirements are as follows:

ETHIOPIA RFCONRY PIU('-I;AM

ReaVirements from A.I.D). by Sector ($CY)

I. Livestock and Water $2,000,000

II. Agriculture and Settlement 1,000,000

III. Crop Protection l,000, 0)

IV. Rural Roads 3,250,000

V. VolAg Projects 750,000

Total $8,OO0,000

Note: These amounts are illustrative of likely magnitudes. The USAID/Ethiopia Mission Director will have full authority to shift funds between sectors.

iii II. M{E PROGM1 A. a

Ethiopia comprises an aea somewhat less : f C '.f than half is included n U " and the remainder is lowland 4­ scrub 'a :l'n . ,. total land area , Is agricultural -- m,3,. for livestock. While only produce about 7-9" 1 : about 709 of the value of Etioo±iE: livestock -.-.r .....-_ accounting for 25v and foret la:nU: Topography, climate, a-n i!. .E! h. north and northeast, where rainfall - virtually 1_ minmi:. al A " non-existent, near-desert conJitionc southwest., prev-]. In the we -. by comparison, rainfall is plentiful, Loi: :fre gool, the population is sparce due to animal the ltrevalence of nujmerous human diseases. The highland area and north ranges from the ruggei, mcuntaincz/L wherc much of the land has lit le arricultu.al value, to the central and southern areas where, fer-ile nevertheless, centuries of Lmproper cultivation has led to massive annuaJ losses of t-omsoil and substantial areas of Erosion.

The general ra'.nfall pattern months between the is bi-modal -Aith a gap o: tw>­ short and the lon raiyt . However, there local variation and i: conrii.ruhh­ in certain areas tropi.-al mono.m Averae annual rainfall odaj. (Qn,1?ioni varies from .5 inches on the Hed 106 inche.: Se:i (.io L 14-, in the southwest plateau area. There are no reliable Current population statistics for estimates place the total near Ethiopia. rural areas. 26 million of which 900 live in 50, are under 14 years cf Of age and only 4:" are 55 or older. the 11.:' million estimated to be in the are engaged working populaion, 0 million in subsirten-e farming. . 0 ilo hiopia is ethnically socially hpteroenou with the pl! dominant Amhara group constituting l;an­ closely 25,c of the p pulation; allied Tigrean Christian, ano$ther -he the 1,000,000; the largest groiip, Galla, about 4O,.v; and the remaind Northern r composed of Somali, Gurage, Moslems, Afar and Western Nilotic groups. Approximately half of the population adheres to the Chrictian Coptic falth, 20 to Moslems and most of 4O7 are the remainder practice tribal religions. Agriculture (including sector of the economy animal production) providing livel;ihood is the predominant and contributing for about 90% 55-60% of of the population subsistence GDP. Most production plots using traditional occurs on small has the cultivatlon largest livestock techniques Ethiopia 65-70 million population in Africa domestic animals), (perhaps as many as less than but livestock contri.butes 30% of total agricultural somewhat output, Manactu.ir, only 10% to GDP contributes and mining virtually 2othing. Ethiopia of tha 25 has been identified least developed countries by the United Nations U.S. $88. 1'4h an average as one Even by African per capita GNP of standards The Country about is extremely poor. 2. Resume of C1.rrent r Stuato.

In the provinces, escarpment zones of the famine began Ti...re, Wollo am Norther The with the falture of Shoa general lack of rains the 1971 raiw season. did fall, has perens-d since has been L-r-gulax that time. What rain destroyed and has ,'aused erosion, crops, yet has been flooding, and to of gent~ally inadequate mature. By the time &lration for of the fa , 01 crops March he 1973 little rains, - April. of in and that year, almost famine conditions began a4 tckofodhdbenxhsd to sel i. o Signs that the evident by early drazrht ws reacl::; May. Livesto-k and crisis proporticns '.nubers. People draught animals were were in some areas were dying in ever-increasil weed seeds. reportedl, reduced By May and tc eating weedL "-ald process, early June wholcsale with husbands population migra-Io. to desertLine wives the mac. roads from and f'milies, and Tigre, inaccessitle drought-affe people beggixg help from -ted areas in Wc-lD left traveler. Whole z'd deserted with villages in the interic numerous recent rriaves were mute esti - that had occu'red. the tragedy - . a

proportiorL;. %'"Au- ut 1973, Feeodirf:, ntaons the sitaation had refugees were put int: operationreached ii:aster had gothereJ by missionarie. in places where Dy September, however, and o.her ,olags it was cl..-ar in Wollo Prc'ince. and disea:'e, +at thousands oncentrations had diedcff star'a ­ 4­ supervised of huan'y in hastily and pro,'isioned erected, Poorly relief camps enabled to spread quickly cholera and o-he- among aL-eady weakened seases children and adults. In Wollc, was overwhelmed the hardest hit by the magnitude Province, the provincial government and severity of the jovern.u.)nt was slowv to recognize drought. The central and that ITge-scae even slower to respond, famine was occurrinp the way In Tigre Province much of preventing mass more was done in their migrations People own villages through were reacherl w-Ith the sys te of already f ji , existing feeder ro.u.:. In addition to the "feeding stations" to prevent people from dying, a "food-for-work" program, which had previously been-developed by USAID in Tigre, was e"_panded in Wollo Province for those able to work. Under this program many people were sent back to their villages, fed and set to work building necessary access roads. Efforts to deal with the crisis were considerably expanded after December, when the lEG had finally determined the extent famine, and after world-wide of the attention became focused _n the as it had situation earlier focused on the famnine in the Sahel. televisicn documentaries Magazine and were presented in many countries and world-wide press reportiug increased markedly. This publicity resulted in influx of relief assista< large consisting of large quantities of food and medical attention.

Even though some crops had matured by the end of September, overall crop shcrtfalls continued to cloud the picture. While there been rains in some parts of the had affeoted areas in July and August, 1973, they had been of short duration and the prior loss of oxen prevented many farmers from cultivating their fields. Seeds for planting were often lacking and, in many cases, had been eaten, The best areas cropping S0, of normal, but most had areas had less than 50" croppir , with some as low as WhileW-ho. the national grain harvest proluced apparent cor."onercial suL-puc, an it should be noted that of the estim-e] 5.5 million tons of irra. harvested in a :ood year, only about 625,0O. tons normally enter the commercial sector. The remainder is c :-imed within the subsisZen-e sector an] it was here that *he effec-.r o the drought on output was felt.

New reports )f drought 6ondirions began in S,-hern t-oi to filter out in early 1974 with evi4"ee severe of larre 2f famine and livestock losses ifl the Provinces Sidamo c Harrarge, le, an! Gemu Gofa. ita sca-t fiej roadia- road ono network in the.-e areas, the ex'en- of the assess. problem war di:'ficjt o The TYC -et o a relf dis'ibu-':. system distributin with-majr poin_ along the rail ine between J-bou-i and and Adds Abba, the Ar'ry and the Air F'orce asist-ed in in these o :' elief. i.._od areas. A nutrition su=-rey &d ccr -,. wasunertaken Harrarge witn USATD in assistance in order to teter ehermine -- of famine and a;7ricalt,,ial ex-ent conditions in the southern prv.'ince.

Atprecise determination of t. di-ersiors and the mainit':do of -he rought of its effects is not poil The that almost three 7EC e:­ million Deople have been affected. These large include segments of the population of eiht prc.-inoes. affected have been ',!ost z people in the WolJo, Tigre and Northern Cho% in an area encompassing -O.,i11., about 200,000 square kilometers. The Foilo'ir2 is a breakdown of the eight provinces and estimated population afferf.e,: pr6vince No. People -Affected

Wollo 900,000 Tigre 322,000 Shoa 120,000 Harrarge 220,000 Bale 175,000 Sidamo 200,000 Gemu Gof fa 7,000 Kaffa 25000

Total

To these initial estimates, made lEG has in late 1973, the added another one million persons as having through mid-1974. been affected This would b;ing the total to 3 million, 12 percent or about of the total population of the Country. should be noted that However, it since a census of these areas has never taken, the accuracy been of such estimates is open to queLtion. estimates for Harrarge irnpr-v.'ed Province are expected from- the nutritional survey recently conducted in thqt Province, resuLs of which are expected to be available in A'ug 4st, 1974.

Accurate data is not available regarding human livestock losses. and It is generally agreed by most observers, however, that over 100,000 people have died of starvation and diseases.

The problems cf the nomaiS deserve special These people live in mention. an exceptinaily harsh envircn- en are absolutely dependent and, therefore, on -heir livestock both for f'ood means o7 exchange and as a for other basic requirements. ThUs the severe depletion of livestock hi: them marticularay harj. It is estimated that 800 of their cattle, 50' of their cheep, and 30"' 1fr craeels and goats have -died causing a serio food problem s nce depend largely on milk -he, as t-heir 'sptale diet. :'h-: .ele to reach them because of their Isola'.on. When grain was e,',:2:"l provided to them, they '. had considerable difficulty in their dietary habits, chariin­ al'tho-ugh this would have been desra' lfry a nutritional p:int of view. In the meantime, ma.' had tc :e1 their re:,ahining animals and few belongings in order tc buy f~od. 5 3. IEG Restonse

The EG was decidedly slow to recognize the the drought throughout extent of 1973. AlthoJgh an interministerial committee for the drought was constitiited as early as April, 1973, it was not until early 1974 that the lEG began to de4 effectively with the drought.

Following the unsetled condition February in the country in and March, 1974 (caused in part by widespread dissatisfaction among influential groups in Ethiopia with the way the drought effort had been handled) which led to the resinatior, of the existing government and the appointment of a new one in its place (with Endalkachew Prime Minister), Makonnen as it was announced by the new Prime Minister drought would that the be dealt with as a matter of the highest priority. the In April new government established a Relief and Rehabilitation at Cabinet Com- -- ion .RFTC5 leve] with a Comiissioner fcr Relief and Rehabilitation, reports directly who to the Prime Minister's Office, as the chief officer. executive (The new rommissioner is A-to Thimeles Adugna, Vice-M-inister Interior). of The RRC was empowered to receive and channel into programs all domestic drou.'h: and external assistance. The Ccmissioner moveri rapidly to enlarge the Commission by, drawirng professional and technical staff from other unitz of the lEG, i3cluding the military. ?y mid-June the RRC comrised over 1974 30 professionl staff members assisted by severpl foreign exnerts and U.S. Peace Oorps Volunteers.

In addition to the central headquarters, expanded field the Co~..iscicner staff by assigninr miflitar and civilian persorel province--. to the Hloweer, ineffective ad.-linistration at the provincii,_l and lack level of coordination between the, provincial offices" and headquarters the central remains one of the m-ajo, problems facin, the R.RC.

Specific IEG self-help measures in 197. include:

- Earmarl.king million from dPmes2 sour-es in its FY 1975 budget for rehabilitation prooects in drc-Lh--affected areas. There is a goaD_ p:_.szibplit. that a supplemental tudget for additiLnal funds will be rect, edearly in ,967 , . . F1 1975). - Simplification of ship and cuwtomr clearances ir.or t: to sp-eedl un the receipt and movement of r lief crikL- and other cor-. 'e:. - Issuance of a statement by thp Prime Minister's .ffice *- Deputy Governors would be appt.inted Provinces. to the drourht.-stricke- These officials wo,_ld also serve as provincial Drought Relief Co,--issioners resporsible to the R and R C..ission. - Provision by 6 Ethiopian Airlines of free E$100OOO for people tickets valued at traveling on official business areas. EAL has also hauled to relief gratis. E$400,OOO worth of relief EAL has waived landing freight fees in an effort to speed the hauling of relief freight up to distribution points. - Appointment of special representatives at each of the seaports of the R and R Commission to Improve the handling grain to and transit of relief distribution centers. - Assignment of Ethiopian university field stations and high school students to assist in famine to preparation of relief tasks including weekly stock reports summaries. the are often These students assisted by American pCrs. - Instructed the Imperial Highway Authority authority to the inspection to give i's highest and maintenance of vehicles used for relief purposes being by the R and R Contmiscion. - IEG army units operating in Wollo ecuipped Province, with -,-hicle-. with 4-wheel drive,' form units assigned self-contained transport to the drcug-_r stricken been engaged extensively Province They have in the movement of medical suplies food, clothing, to the urought vi-tims. - A militar, airlift to provide transportation area and fuel to other aircraft o airlift the Jimma grain to southern provinces - Larje size trucks to traaspM-t relief grain from the portz. - lEG police have proviieJ 15 vehi:!es Provinoes in adjiticn in Wollc and Tigre to crwoidin,- serie for all IEG and maintenance vehicles uIse- for famine relief in ',cllc and Tigre Provinces. - Assignment of rolice and milltary officers internal movement *c ecpedit "he of relief commodities. Th- R-FC has greatly tH3-tr.v respond promptly to urgent a'2'' -.-drou.....rou~t-relat.. paii\ I problems !ro.. t t' effhtive ac 'ons mn' improve have been "akc-n tc restive commercial transport port 'o - n to new of grain, -JZEth*ehicle-- famine areas and to coorinat ando­ as of August external asstan 1974, t-he RRC still . deal effectively lacked administrat .,e -,h:i--, with the full range of drought-related Pz' blemz. t a!onthlv donor meetings were started in May, 1974 under the chairmanshio of the forum for the discussion RRCommissioner. These have of problemsz and have provided a regular permitted foreign donors 7 to exchange views and coordinate new activities. A monthly w;:]ePl.Ve. i:. flow publi.hed by the RRC (Vol. 1, No. 1 - May 1974) whi!h pro-1dlce: immunries of the draught r!ttlation i:: well : sl .OiLs LieS.on the movement o' commodi Llt.:: drild ,iir' oI::Li. I,,i',,'I .Ii.ii,

In summary, the RRC has a anindate [rom the Prime Minister to fulfill the follwing resDOnibilities: (a)cocrdinate the relief and rehabilitation activities of government and volunteer agencies in the drought­ affected areas of Ethiopia; (b) act as a focal point for all offers and receipts of assistance for the affected areas; (c) arrange, on the basis of need, the distribution of relief assistance, provided by both internal and external sources, to these areas; 'd) assist provincial relief authorities and volunteer agencies in the execution of relief programs. The Commission is also l'tsponsible for the coordination of short-term arn medium-term rehabilitation projects for donor financing.

4. I Go.'ernmenrt Re oor

As early as January, 1973, PL 480 Title II wheat scheduled for Food-for-Work projects in Wollo and Tigre was diverted for famine use in these two Provinces. 1The" first diversion "';-n 200 tons of wheat in each Province in Januar,', 1973. in April, 1973, the U.S. Goverrment received requests from the 7nterin teria! Relief Committee for diversion to affect .A area, f - ,000 *erictorz of o Title II Food-for-Work wheat alreac in -'thiooia ar for. rvisio. of an additional 8,000 ?7 of grain fol the relief prorram. Botn eque.o were approved, in early May-. The J W''orld FooA F-cjrc: also received an appea2 fr:om the !EG for 20,00C :tri _ tons Df rrain. Cf hi aount, the 'IS w.-as a±sked -o supply, l0,COD W which was pro! -ucreed (the remainder being purchased by WF? from Ke-,'a and 17ona-:' to ,'WV? the European Economic Cor nissior.). In view of the fact a, it wo' take some time for the US grain tio arrive in Fthipla, t-he E bo-r wed and releasel from their own-stocks 7,000 !.7 of grain to be replaced, ipon arri..l, by Us grir.nshlinento, The firit 0,.T Of corn, began arriving In November 1973, -th the remaini plus the 10,000 W' donated by the U through WF? arrivinr7 i. ecember 1973 and early 1974.

m December 3, 197, then Ambassaor E. Fos. Adalr, responding to a formal request for as.sistance from the -G, re .ezs-d and received the $25,000 Speial Axassador's Fund for discreticna - use in the drought and subsequently declared that a disaster situation existed warranting further US Goverrnment assistance. A program of American disaster relief assistance was developed in five general categories: a

a. supply and shipment of grain and other food commodities from the U.S.;

b. assistance in the transportation of relief -upp]les within Ethiopia;

c. provision and transport of ecsential commoditico other than food from abroad;

d. technican assistance primarily for logistics;

e. financial support of Ethiopian Government drought relief programs.

As of July 15, 1974, the U.S. Government had approximately contricuted US $18 million to famine and drought relief programs in Ethiopia. This assistance has been primarily channeled through the RRC. Some relief aid has been given to American voluntary agencies and international organizations involved in relief activities.

Specific USAID assistance provided as of July 15, 1974 is as follows: Food Grains (includes ocean +a-prt.tl n cosa,s):

64,36F metric tons of food grains and other food commodities have been delivered, shipp, or connitted to fazdne relief programs d-iring FY 1973 anj FY 1974. The majorit of this has been wheat, corn, and qorghx-. grairs. About 16, .!T of this grain has been -hannelec throigh the World Fo-d Proiram. Over 4,000 tons of 7.[ 'a blende4 high-protein food made from corn, soy beans and pow rerd have beer- deliverei 3r scheduled for deliven, C 'J iC-F for use in. t -.eir relief program in Ethiopia.

Domest ' c Transnortatior:

The transozrtaticn of relief sup: lies has been a nartc -ar:,­ difficult' 2r7le, for ". thiopi-n Government. k'I na. s assisted by providing 27 trucks (made available from KaLnew Station a: $298,500). -. is a-:icipated that about 30 more vehcles, valued a*, $30C,00, will be t-ransferred ts the IEG from Kagnew excess. US.AID has also made avaiiale US $200,000 to assist the IEG in supplementing commercial trucking rates in order to expedite conercial transport of relief grain. 9

- Other Commodities:

A.n &rlift of 400 truck tre-, Eaid tuheo for u:,u on TF(: ,ir',t r'u'kt: Ih ifl.LQ! relief : 'pjp.l -::,'.62 ro1l (Wr .'()'x .IM r nf'orcod plastic, sherl ing f'or ' r'u n pr, ,LI.i'.,I :Lrt,I ::11- lI.''. 10,000 blankets for disl~ribulion Lo persons ini t.:u ,.., 50,000 square yards of cotton cloth for relief camp dicLribiLlon, and $10,000 worth of locally procured and imported druLs.

- Support for IEG R&R Programs:

US $187,000 has been made available to the Extension and Project Implementation Department (EPID) of the Ministry of Agriculture to finance the construction of grain storage facilities in drought areas,

- Sixty-six tons of Dar and funds for blending insecticides for the EPID crop protection program;

- Assistance to a nutritional and agricultural status survey in Harrarge Province included the provision of medical staff personnel and a fleet of helicopters to transport the survey team;

Assistance to TXN. and Voltan,Avencies:

The United Nations Disaster Relief' Organization (UNDRO) received US $145,000 to help airlift 25 Fiat trucks, donat-d by the trrancs, and a U.S. $100,000 contribution was made to help defray the airlift costs of 20 U.K.-dcnated medium load truck-. Thf Le-a,;u I_:"nternational Red Cross LSocieties was given US $10J,Off throu.Lh the Arrrican red Cross, Io p.:ocure and ;n.ip ano*_htr ,O'2 blar-.

- Approxi'cately US $60,0-0 worth of D"d t,_,f: waz tr ansferred to the Haile Selassie i Foundation and the ,2Afrom excess proper-y stocks at KaTneV Station.

- Approximatel:,. $77,O0C waz pr:vi.ed to the M.dical A.=__-ance Program (a US Voluntar;, At-ency) for shipment of relief' floo supplies to rthiopia.

- Technical .,sstance and Cther Corts:

The American Gover-rment has provided personnel zi.pr -, technical assistance as required to meet an expandinq iht4{ program. The USAID Mlission has had one technician or. i'z :aff 10 working exclusively on relief and rehabilitation and another full-time officer has been recruited to head up the newly established Drought Relief Section. In addition, there have been two emergency relief technicians on extended TDY helping to expedite the movement of relief supplies. The USAID engineer has been working on a nearly ful-tioe basis on the drought.

5. Other Donor Response

(Note: See TOA.ID A-64 dated August 7, 1974 for a detailed listing of all donor relief assistance as of April 30, 1974.) Many of the private voluntary agencies already operating programs in Ethiopia during the early stages of the drought began contributing funds, commodities and personnel as soon as it became known that famine conditions were present. Missionary pi-ograms, such as that of the Society of International Missions, the Ethiopian Secretariat Catholic and the Lutheran World Federation began providing assistance early in the drought period. As numerous other VolAgs secular and religious alike began mounting relief efforts the need for coordination became increcsingly apparent and the Christian Relief Committee (CRC) was instituted to coordinate the efforts of the approximately 40 VolAgs which by 1974 were mounting relief or rehabilitation projects in Ethiopia.

International Agencies of the UN, the IBRD and nuwmerous bilateral donors also began to make sizeable contributions and to mount programs in the latter part of CY 1973. They have donated or pledged to date more than 130,000 metric tons of relief grains plus large quantities of high protein foods, vitaminF and medicines. Transport vehicles, medical personnel, bedding, clothing, commodities and cash have also been provided.

Several donors have begun to devote attention to the need for rehabilitation to revivify the drought areas and help the drought victims resume Droductive activities. The World Bank (IDA) is in the process of approving a U.S. $10 million credit for a rehabilitation program in Wollo and Tigre. The program would include rural road construction, rural water supplies, an integrated pilot settlement project, an interim program for the northeast rangelands, surveys and technical data collection for settlement programs, assistance for project preparation, farming systems' research, handicraft/small industry development and the establishment of health center2 and facilities.

The U.K. is providing staff and equipment for a larg, rural road construction effort in Wollo. Germany, UNICEF, U.K., Sweden, and church organizations are engaged in borehole drillim and other water projects in Wollo and Tigre. Various voluntary agencies are also engaged in rehabilitation projects in road construction, water resources development, relocatig 'anilric out of the relief camps and providing oxen and seed to othervrimc destitute farmers. In addition, assistance being provided to regqlar goverrnent programs and agencies -- particularly to the Ministry of Agriculture's Extension Project Implementation Division -­ is being utilized to develop and implement rehabilitation projects. IDA and Sweden are heavy contributors to EPID.

B. Analysis

1. Economic Overview

Ethiopia is one of the least developed countries in the world. Within the group of the 25 least developed, Ethiopia has by far the largest population, numbered at about 26 million in 1972, with a net population growth rate of about 2.4% per annum. About 9cr! 0 of the people derive their livelihood from agriculture. Some 85% of the population are peasant farmers living at the subsistence level; 1 are engaged in other traditional activities; and 5% are in the modern sector. The urban population is growing at about 6.5% per annum and is concentrated, along with most of the industrial capital, in the two rapidly growing urban zones around Addis Ababa and Asmara.

Only about 10% of the population has access to health services, and only about 3% to clean drinking water. Among the 25 least developed, Ethiopia ranks among t*e lowest in literacy rate (about T), primary school enrollment rate (about 15%), number of inhabitants per physician (about 70,000), GNP per capita (U.S. $88 - urban about $383 and rural about $58), official aid receipts per capita (about U.S. $2). The life expectancy of about 40 years is near the median of the least developed.

The Ethiopian econoW has grown rather slowly during the 1960s and early 1970s. According to figures recently released by the IEG, the average annual growth rate (Gross Domestic Product at constant factor prices) during the period 1960/61 to 1972/73 was 4.40 (with a sectoral breakdown of agriculture: 2.310; other commodities: 7.2'; trade and transportation: 8.3%; aad services: 6.6%), although the growth rate during the second half of the period (3.9%) was significantly lower than the growth rate during the first half (4.0 4). Given the estimated average annual population growth rate for the period of about 2.0%, per capita, GDP grew at about 2.4% per annu,m. At current prices, GDP in 1972/73 was Eth. $4.8 billion (U.S. $2.3 billion). The econori­ underwent a gradual structural change as non-monetary GDP dropped from 12 55%o of total GDP in 1960/61 to about 40% in 1973/74, and agricuiLture's share of GDP declined from 68% to 50%, reflectini! a low rate of' growth of agricultural output averaging .I.3V per annum. The population growth tate ha:. 1100.eler1ated g:'ih' t I.y ,1 an es iiabed 2.4'v per annum so that by the, early 197U':: z'I,.i',,,I -,Iir:,l production was not keeping up with popula Lion incre:1.:, and per capita GDP growth was less than 2.01o per annum.

2. The Agriculture Sector

Agricultural land is the country's principal natural resource producing 50% of GDP and most of the country's exports.

Most of the cropland lies in the highlands or in the lowland river valleys. In the western portions of the highland plateau are found the country's most productive reddish-brown soils and the most abundant rainfall. Nearly all the pasture land is located in the Great Rift Valley, the plains of the northeast, and the vast lowlands of the southeast where in general soils are poor, rainfall is small, and temperatures are high.

River water resources are important for the development of irrigation in such areas such as the lower Awash, Omo and Takaze River Valleys, and for hydroelectric power as in the case of the dans on the Blue Nile tributary of Findha and the upper Awash.

The lifferent soil mixtures and climates of Ethiopia have created a multiplicity of ecological zones which place great demands on agricultural research 4nd extension.. For example, grains such as wheat, teff and barley grow in the cool highland zone. In the temperate zone, which is lower in elevation, are found corn, sorghum and millet, as well as the grains. Coffee and ensete do well in the southern portion of the temperate highland zone where the rainfall is greater. Cultivation in the hot lowlands is limited to tropical and semi-tropical produce grwon in river valleys or with irrigation. In the northern highlands population pressure and poor cropping and grazing practices, coupled with sto~r soils, have led to serious erosion. These conditions have been exacerbated by the drought in Wollo, Tigre and in southern Ethiopia. Grains are 'he most important field crops and are planted in about two-thirdc of the total crcpland. Teff, the preferred grain for dome:tic consumption, is planted in about half the land devoted to grain. Barley is next in importance followed by sorghum, corn and wheat in that order. In a good year total grain production in Ethiopia is estimated to reach nearly 5.5 million tons of which the vast majority is harvested by hand and consumed in the subsistence sector. 13 Ethiopia supports the largret livestock population of tuly couriti in Africa, and more bhan hnIf of' the total lanzl Wtrn ' I~:thlpla i:o uj;ej at: permanent pasture,. AbcniL 60-A )I (W id I I Iv,::I.,.k is owned by highlad farmers and thc ,r'malning 2;U(-/,(g 1by lUii ci',i,1i,. peoples of the lowlands.

The principal Ethiopian exports are coffee, live animals, meat, hides and skins, oilseeds and cake, and pulses. Coffee alone accounts for nearly 50% of export value: Ethiopia's Foreignjrade. 1961-19 (Millions of Ethiopian Dollars) 1/

1961 1 1970 1971 1972 Coffee Exports 94 188 18l 175 183

Non-Coffee Expcrts 95 102 125 139 201 Pulses 18 14 16 22 26 Oilseeds 15 25 32 38 55 Livestock Products 26 34 34 38 70 Other 36 29 43 41 50 Total ! Exports 189 290 306 314 384 Imports 236' 376 429 470 436

The grbwth of exports in recent years due has been sluggish in part to the closure of the Suez Canal in 1967 and to over­ reliance on a very few exports. Recently pulse prices have risen considerably as have coffee prices and inport earnings in 1973 were improved. However, while there is some possibility of improvement in Ethiopia's foreign exchange position in 1974, the steadily increasing costs of manufactured imports, the rapid escalation in costs of petroleum imports plus the effect of coffee berry disease and drought on the volume of coffee exports are likely to more than offset in the long term any short term improvement in Ethiopia'( foreign exchange position.

3. Development Prospects

Tne IEG has done considerable preliminary plannint, its Fourth Five-Year for Development Plan (FFYP) and, although there i:. uncertainty regarding the timing of the promulgation of the Plan, its rural development orientation providing increased benefits to the peasant farmer is unlikely to be qhanged. 14 The overall Plan objective is to perceptible and achieve a steady increase in the well-being of the people of Ethiopia through rapid output growth ("attainment of the fastest possible rate of overall growth of the economy, cons:i. tor, with efficient utilization of the Nation's human and natural r:olr..;") and improved equity(" ensuring that the benefits of social and 2:r,,. development are even more equitably distributed among the population"). Regarding the output goal, the target GDP growth for the FFYP period is rate 6.0% per annum, made up of a growth rate for agricultural output (which will account for 50% of GDP in 1974, and is expected to decline to 43.5% of GDP by 1979) of 3.1% and a growth rate for non-agriculturai output of 8.5%. To support these growth rates, the IEG estimates that exports will have to grow to 8.5% per annum during the FFYP period (or twice the growth rate the previous decade), of and domestic savings (private and public) at 9.2% per rnnum.

The lEG has not presented quantified targets equity goal. Policy for the pronouncements have indicated that the important subsidiary most goals are 1,(i) creation of greater employment opportunities; (ii) instituting reforms in the land tenure system such that tenants get a fair share of the benefits of agricultural development; and (iii) in general, re-orienting development toward rural areas so that the majority of the Ethiopian people will begin to participate in overall development, and thereby also enhance their share in the fruits of development."

The major elements of the TEG strategy for output growth achieving the goals are stepped-up domestic resource mobilization, particularly through increased tax revenues, expansion of the EG's capacity to identify, prepare and implement projects, exnansion intensification and of the inimum Package Program for small farmers, support for settlement schemes an$ commercial vigorous agriculture, and more export promotion. The major elements of related the IEG strategy to theemuity goals are pronotion of low-cost changes settlement, in monetary and fiscal policies to correct distortions fa Tor-price and encourage labor-ittensive techniques, improvement, land tenure and greater emphasis on rural areas in the education, field:: of health, roads, water supply, etc. The framework rural development for efforts would be provided by the "amraja" (sub-province) self-administratiom program which would broader participation encourage in development through decentralizing a delimited amount of government decision-making to the nwraja level. 15 In simplified about a terms, the intent of the relative improvement in the FFYP is to bring through well-being of rural Ethiopians the encouragement of small generation holder agricultural production, of employment in rural areas, rural services. Tf and the improvement of the rate of growth in agricultural increased to 3.1% output can be per annum (versus an estimated last decade), while 2.2% during the the rate of growth of non-agricultua increases at 8.5% per output annum (the same rate as previously), between the rates of the gap increases in per capita GDP for the agricultural and non-agricultural Ethiopians in sectors will be narrowed. The XEG'p development strategy has implications beyond the FFYP period. If reaching continued successfully, the will permit a more rapid expansion IEG strategy of small farmer production infrastructure and services. and rural By the year 2000, per capita be Eth. $400-450 (US $195-220) GDP might and 40-50% of farm families reached directly by could be the 10P and settlement projects indirectly). A majority of (and many more the population would be near nearly all would have access a road, and to primary eduction and health Increased small farmer participation services. facilitated in development would be by proposed multipurpose co-ops in the to be formed initially MPP areas, and would be supplemented decentralization by continued government within the Awraja self-administration program. As indicated in the adequate output DA', the FFYP result could performance due to a relatively be a fairly payments position, strong balance of combined with less adequate to the equity performance relative goal due to government budgetary could problems. This outcome of course be partially mitigated particularly by donor assistance directed at improving domesti resource coming absorptive capacity mobilization and over­ problens affecting equity-oriented It will also depend on programs. the quali+y of the new Government's to coitment the equity goals of the FFYP. Obviously, the political July, 1974 (and events of February4-arch any sequal to follow) will and the have a major bearing on emphasis to be given one development and upon the priority vis-a-vis another resulting allocation of Ethiopian The drought funds and effort. and the accompanying recovery to be undertaken, and rehabilitation prograz for example, is one factor significant impact which could have a on the lEG's overall investment are other decisions. There possible examples, as well.

4. Constrain ts to Development Based on IBRD, lEG, described more pnd USAID analysis -- and a:; fully in the DAP - the critical achieving constraints to the goals stated above are: 16 a. Land Tenure More than half of Ethiopia's farmed cu.Ltiwvtnd land:, ai', by tenants who make up more than halt' of population. Ethiopia',: rwa.L There are numerous form- of land tenure many of which arrangements, are extremely complex. In some areas of the right to tenure is north, based on kinship, lineage or tribal ties rather than individual ownership. In other areas, large - often absentee ­ landowners have holdings worked by pay poor tenant farmers who usually from one-third to one-half of their annual production and who must often in rent, provide other services to the landlord as well. These tenants normally have little, if any, security of tenure and may be evicted with little advance notice. normally Since the landlord will not reimburse the tenant for any capital or for expenditures improvements, for such inputs as fertilizer and improved seed, the tenant has little incentive to make such improvement or to increase productivity.

In addition, population pressures and traditional landholding practices lead to fragmentation of increasingly land holdings into smaller plots. It is common for a tenant farmer have several non-contiguous to plots several kilometers apart, each of which is less than one hectare.

Finally, Ethiopia has no proper system registration. The of land boundaries of holdings are not recorded, there no good basis for determining is the incidence of land tax. There is not even a very clear picture of the extent of, or boundaries to, Ethiopian Government land.

b. Lack of Rural Roads The vast majority served of Ethiopia's farmers are not by the present road system. It has been 251 estimated that only of Ethiopia's rural populati6n is within a half-day's road. Development walk of a in the transport sector has thus far focused upon been arterial - primary and secondary - road construction, with little having been done to provide the interconnecting capillary, or local rural roads. Without some form of farm-to-market roads, IEG agriculturq and feeder/access programs cannot reach the farmer. He obtain improved cannot inputs, or extension services, nor does he have adequate access to markets for his product. was instrumental The lack of these roads in the decision to locate the first Minimum Package group of areas along already existing primary and secondary roads and thus, by necessity, denying their benefits to vast of farmers unlucky enough numbers to live more than a few kilometers from a 17 trunk road. As MPP and other government programs expand, the development of low cost rural roads must, by necessity, precede them. The lack c'f access into mar of -the drought affected areas has also been strongly indicative of the need for rural penetration roads. c. Central Develoxnent Policy Execution

There has been criticism, both within the IEG aiid by donor agencies, over the slowness with which program and project planning proceeds. The planning policy-making and overall program execution is laboriously slow, tle decision-making processes too layered, and the implementing agents fragmented, uncoordinated and poorly staffed. The result is inefficiency in the utilization of scarce resources and less than optimal achievement of development objectives. The manner with which the drought and famine were originally handled by the IEG, and the manpower and implementation problems which have continued to plague the R ard R Commission are indicative of the pervasiveness of these constraints even in a program which presumably has the highest priority call on Ethiopian manpower resources.

d. Production and production Technigues, Research and Experimentation'

Very few Ethiopian farmers have access to packages of improved seeds, fertilizer, pesticides and animal pharmaceuticals. The Minimum Package Program is designed to make available packages of improved inputs to farmers only in NTP areas. By 1980, only 500,000 of Ethiopia's more than 4 million farm families will be covered by the Minimun and Comprehensive Package Programs.

Only a bare beginning has been made in applied an adaptive agricultural' research in Ethiopia. Many important agriculture products including pulses, oilseeds, coffee, livestock, forestry and fisheries, require considerably expanded research. Research data which has been developed on cereal crops needs to be augmented. In addition, long range research should be undertaken in crops which could be better adapted to the Ethiopian envirorment in order to speed efforts at diversification. Also, research is required in such basic areas as irrigation techniques, cropping practices, improved tools and farm implements, in forestry, and in erosion control (approximately $300 million worth of nitrogen alone is lost annually via erosion, not to mention considerable quantities of phosphorous, calcium and other elements plus the loss of the soil itself). Lastly, Ethiopia needs to be more closely tied into the world-wide agricultural research networks for crops such as cereals, pulses, fruit, vegetables and fibre crops. 18 The principal agricultural research organization in Ethiopia - the Institute of Agriculture Research (JAR) - has only been in existence since 1966. Since its outset, it has been hampered by inadequate budgets, difficulty in expatriate recruitment of staff and in the limited supply of trained Ethiopian researchers available to work with IAR.

e. Lack of Educatipn and Emnlovment Onportunitv

Of the Country's adult population, 13.6 million estimated at in 1972, 12.8 million had never been to school. Among school age children, only 17% of potential primary school age were actually in school, and of secondary school age the corresponding figure was 4%.

Yet, even at these low levels of school graduates have education,- opportunity, been findiig it increasingly difficult to secure employment. In recent years, secondary school enrollment has been expanding at a rate of 20% per year while the annual GDP has averaged 5%. grovrth rate This imbalance has created a situation of rapidly increasing urban unemployment arong school leavers. Eien graduates of higher non-university institutions, like polytechnics, now exceed demand.

f. Endemic Diseases and Lack ofAdequate Healh Fac iities

Public Health services in Ethiopia distributed especially are very thinly outside the two principal urhan areas. population/physician The ratio is 169,000 and the population bed ratio is hospital 1/3,000. Seventy-tive percent of the incidence of disease is preventable but is ndt being prevented. The combination of: general poverty, lack of access roads, lack of water, prevelance of numerous endemic diseases, virtual lack of knowledge of basic hygiene on the part of most of the population, and shortage of trained manpower and of funds all serve to create a situation general improvement where of public health in Ethiopia becomes an enormous and difficult task. The task is made more difficult by long standing organization and management problems in the Ministry of Public Health and is further complicated by the multiplicity of organizations engaged in health activities in Ethiopia. For example, the armed forces, the municipalities of Addis Ababa and Asmara, the Ministries of Public Health, Education, National Community Development private organizations and numerous have health and health-related programs scattered throughout the country. Coordination of these various health activities appears to have been a virtually impossible task for the MOPH. 19 5. Economic Impact of the Drought It is difficult to estimate the magnitude of' the economic impact, of the drought becaw,,c, the maJo, impm, I. of' 1,11, dirou!ght Ila- faller. on people in the ::tener: mn -ml,.(! .-,:!,i econoiy. There have been few visible effects of lie drctil!hl, ,,11 the monetized economy. For vast portions of the nomadic popu:Li.Wri::, the result has been all but Lotal destruction of their economic livelihood. The subsistence farmer, suffering from several yearn of abnormally dry conditions (e, .decially in Tigre and Wolfo), found that, while 1973 farming condit-ions had improved his lands had been so devastatad by the preceding dry period that he had no choice but to leave his lqnd for relief centers.

With regard to the monetized economy, traditional indicators of economic activity (e.g., aggregate levels of imports and exports, IEG budget and commercial banking activity) reveal few changes that ca.n be directly attributed to the drought.

In FY 1974, IEG budget expenditures for drought represented mainly special Ministry of Agriculture (EPID) activities in drought affected areas. In FY 1975, the IEG has budgeted US $2 million in addition to the Ministry of Agriculture (EPID) activities. With regard to exports, the 1973 coffee production fell between 10 and 30 percent due to poor rainfall, coffee berry disease and other factors. However, an increase in world coffee prices offset the negative drought-relqted impact so that coffee earnirngs actually rose over the 1972 levdl. Similarly, high world price:: i'or Ethiopia's" other major agricultural commodities have tended to offset drought-related declines in export volumes.

The impact of the drought on domestic grain prices has not been as great as one might expect, largely due to the lack of even minimal purchasing power in drought areas, massive relief grain imports, and an IEG export ban. As a result the approximately 15Z price increase in 1973 and 1974 is much below the dramatic 40% increase which occurred in 1969'and 1970. Because of good crops in early 1974 and the above impediments to greater monetary demand for grain, Ethiopia now finds itself in the curious position of having an estimated 30,000 MT conrnercial market grain stock carryover in the midst of an estimated 100,000 MT nutritional need in the drought areas. It has been estimated that 15-20,000 LIT of this carryover could be locally purchased for drought relief over the next year.

With the possibility of a relatively good harvest through 1974 and the current commercial market grain stock carryover, there will be a need in the near future to coordinate relief grain 20 operations wi Lh domestic production, possibly through market intervension, IEG in order to prevent unnecessary price instability.

In the longer run, rehabilitation and reconstruction efforts must take into account the ecological between balances desired livestock and grazing land, and between farmland, farmers and in order that Ethiopia be left in a stronger to withstand position the impact cCfuture droughts. For example, recent destruction the of large numbers of livestock may have allowed grazing land to naturally restore its carrying by overgrazing. capacity long eroded lh addition, certain areas of Wollo overpopulation where previous resulting in overfarming may have better population/land moved towar,:'a balance by the outward migration which has already taken place. 21 C. Strategy

1. Overview

Drought, As.i is Lance to thiop i:i compr lce. The immediate Lhb,, j,,.L: and overriding necessity i first to prevcnL dying. Emergency peop( 'rui, food and medical assistance plus improving or devising a means of transport to get the food and medicine to the people most in need is the first pricrity.

The second phase includes assistance victims to to the drought get them reestablished on their lands and productive This again. requires assistance in returning people to their farms and drought-ravished village or, if these areas are completely devoid possibilities, of productive to new areas. In addition, agriculture production assistance, the provision of livestock for use as draft animals, develop new or to herds, rumial road construction and water development types are of rehabilitation projects that may also be required.

The third phase is composed of regular jects aimed development pro­ at increasing the economic returns of the drought-affected areas. These projects are likely to be larger and of longer than rehabilitation duration projects. They usually require detailed feasibility studies, and significant technical and/or capital investments. This type of assistance includes programs aimed at attenuating or alleviat­ ing some of the long-term contributing factors to the drought. would include Thi: reforestation of large tracts of denuded land, widescale application the of soil conservation techniques to reduce erosion and depletion of soil nutrients, the ,optimization of livestock herd size so as not to exceed the carrying capacity of the land, a in the rate of population reduction increase and probably basic changes in land tenure arrangements in order to encourage new attitudes toward land use on the part of tenant farRers. AID, in collaboration Ethiopian Government, with the other donor governments, international agencies a nd private voluntary groups has been or will be assisting in these each of categories of assistance. This present Program focuses Assistance ?'per on Recovery and Reconstruction but it is necessary R&R assistance to place in perspective of overall drought assistance.

2. Relief Assistance

As indicated in Section A.4, above, and starting 1973 with the "n April, diversion of more than 2,003 tons of P.L. 480 Work grain to Food-For- famine relief, AID has been heavily engaged assistance. in relief Through July 15, 1974 the U.S. had contributed tons of food grains 64,368 and other food commodities (16, 50 tons channelled through WFP) plus providing nearly 60 transport vehicles from the 22

Kagnew Naval Communications Station (which was in the process of closing). In addition, the U.S. provided other commodities and emergency assistance bringing the total value of American drought assistance to more than U.S.$18,000,000 as of July 15, 1974.

While it is currently estimated that Ethiopia may require something like 100,000 tons of foreign grain during FY 1975, a fairly good harvest might well reduce that level. The U.S. share would likely be in the range of 20-25% of the total outside requirement. Assuming a reduced need for emergency feeding programs over the com­ ing year, the emphasis will shift from merely keeping people alive to returning them to a productive existence.

3. Recovery and Rehabilitation (R&P)

a. General

The IEG and many donors are now devoting considerable attention to R&R programs. As indicated earlier, the World Bank and EPID, on behalf of the IEG, has already been involved in seed and oxen distribution programs to destitute farmers. A small portion of what the U.S. has already distributed falls into the R&R category: funding for the construction of grain storage points, 66 tons of bulk DDT, a helicopter survey team for a nutritibnal and agricultural survey in Harrarge Province, among others.

To date, most relief and rehabilitation efforts have been directed toward the two Provinces of Wollo and Tigre. Much of Sidamo and Gemu Gofa has also been hard hit by the drought. The 1EG's Relief and Rehabilitation Comnission has requested AiD to consider directing its rehabilitation assistance, to the extent possible, to these Southern Provinces.

It is estirRated that between one million and onc-and­ a half million persons have been affected by the drou;ht in SouUvrn Ethiopia. The area is largely corposed of rangelandz and pcopled by nomadic or semi-nomadic herdsmen. Considerable cultivation does occur, however, on the highlands of the Ahmrr Mountains south of ire b)r"a - Harrar, along the Wabi Shebellie and Galana rivers, on the zlope ;' the Bale Mountains and in parts of Sidamo and Gemu Gofa.

Much of the area is arid, without developed water resources. There are few truck roads and almost no rural secondary roads (a situation which has greatly hampered relief food distribution in the southern provinces). 23 b. The Proposed AID R&R Assistance Packare O the $10 million enrmnrked for EtlhlopLii, drot4Iit, assistance in the Disaster Assistance AcL million of 1)74, npproxiuLliy $; is to be used for recovery and rehabilitation large projects. A part of this assistance will be for projects Provinces, but worthy in the Southern aotivities in other drought-affected provinces which meet the criteria, and for which no other donor assistance is available, will also be assisted.

To be eligible for assistance grant, each project activity under this program will have to meet the following criteria: - It must clearly be designed to affect recovery and rehabili­ tation of drought victims and the land they inhabit; - The "payoff" in terms of benefits accrued must occur stantially sub­ in the near-term, within 12-30 months; - The project must be capable of being initiated in possible time. High the shortest priority is attached to getting the recovery and rehabilitation process into motion with the least delay; - Implementation of the project must be the responsibility an of existing IEG, private voluntary, international bilateral donor or agency or institution. AID will serve financing, as a rather than an implementing, entity.

Thc " .ll..n brief project descriptions trative of the are illus­ proposals now under consideratle: for Not all are R&R financing. likely to be assisted and other possibilities undoubtedly be considered, will but these examples do provide a fair section of the types of projects cross likely to be financed under this program grant. While ,aot separately shown at this point, anticipated that non-formal it in education will he included as in many of the projects a component selected for AID assistance. Costs are rough magnitudes in-iicated and subject to considerable revision.

a. LivestocK and Water (1) Surface Water Schemes--including the construct.on or repair of small dams, construction of catchment ponds and stifam diversiono.

Purpose--Studies already exist to develop but serviceable water storage rudimentary facilities in the low rainfall, drought­ 24 affected areas of Harrarge, Tigre, Wollo, Bale, Sidamo Gemu Gofa, Shoa and provinces. The stored water would be used livestock. (Although principally for where water was otherwise completely unavailable it would be used for human consumption as well) and, in some cases, for irrigation.

Scope--The proposal imately calls for construction of approx­ 100 dams, 68 ponds and 32 stream diversions. projects are in addition These small to those now under construction by these drought areas EPID in (eight small dams, ten ponds and one stream diversion). Implementation and Timing--EPID would be the Lurle­ menting agent. The structures will be labor paid built almost entirely by h~ind in cash, or possibly in food-for-work grain. start immediately Work would after the rainy season and all of the approximately 200 sub-projects would be completed within 24 months. U.S. Inputs--Local construction costs, be purchased in-country. vehicles to Cost: Approximately US$1.3 !lllion.

(2) Drilline Ria Repair--Spare parts and on 16 American and 1 Japanese necessary repairs drilling rigs which are currently drilling boreholes (wells) in drought affected areas. Purpose--These rigs need to be kept operational in order that boreholes for both village water supplies and livestock can be drilled.

Scpe--Most of these rigs require haul or motor replacements. major motor over­ In some, the motors are availability of spare so old that tir parts, anywhere, is open to serious doubt. majority of these driils are 'ile more than 15 years old and several dute back to the "Point Four" Program.

Implementation and liming--Tools, spare parts accessories and should be ordered immediately and repairs and should begin on overhaul some of the drilling rigs as soon as the arrived. The rigs spare have are and will continue to be run by the National Water Resources Commission. U.S.Inputs--Costs of spares and transport. Cost: Undetermined. (3) Southern Livestock Pond Construction

Purpose--To provide additional watering ponds in arid areas of Southern Ethiopia to maintain livestock herds during extended period of drought.

ScoTe--To use equipment already available in Southern Ethiopia to construct small stock ponds in Sidamo Province in places where none now exist. Construction of these ponds in selected locations would also help reduce nomadic migration into the Borana Project area where such ponds already exist and where serious overgzing now occurs during times of drought. Location of pond sites would take into consideration rangeland capacities and forage requirements.

Implementation and Timing--The Range Management Division of the Ministry of Agriculture would be the implementing agent. Work would begin as soon as repairs can be made to machinery now located in the project area. During the next 24 month period, it. is estimated that 40 ponds can be constructed together with 200 km2. of access tracks.

U.S. Inputs--Spare parts, repair costs, local transport, construction costs, possibly temporary technical assistance. Cost: Undetermined.

b. Azriculture and Settlement

(1) Settlement of Nomads in the Wabi Shebellie Valley-- Studies conducted in the last two years show there is considerable scope for growing crops in irrigable land along the Wabi Shebellie River (which forms the border between Harrarge and Bale Provinces) and for settling nomadic and semi-nomadic families in the river valley. A small pilot project has demonstrated the willingness of these nomadic peoples to engage in permanent agriculture in the area. I Purpose--To alleviite drought-induced famine in 'hr. area adjacent to the village of Gode' by making the area largely -elf­ sufficient in food production.

Scope--During a 24 month period beginning October, 1974, the settlement of an initial 500 farm families on 1,00 hectares of land.

Imolementation and Timing--The implementing agent would be the Institute for Agriculture Research (IAR) which runs a 26 research station at Gode with technical backstopping the Nntionnl. provided by Waiter Resources Commission. The first be settled imiuiLdiately, '0 fninLies woutl with 200 having bncen otoLied tby ()Loh,,i., 1975 and tile remainder by October 1976. U.S. Inputs --Irrigation equipment, seed, ferti­ lizer, local costs. Cost: $1,000,000.

(2) Small Farmer Rehabilitation Purpose--Assistance to farmers within range surface water of the schemes discussed in l.a. above in making productive again, their farms and i' offsetting to a certain extent the adverse effects of future droughts.

Scope--To assist approximately 5,000 small families over a two-year farm period in drought-affected areas. Program will include extension services, terracing, seed distribution, check dams, tree planting and provision of simple ploughs, harrows, plant-r.:. Imolementation and Timin--EPID menting agent will be the imple­ with the timing dependent upon the rate of the small surface of construction water development projects in l.a. above.

U.S. Inpts--Local costs. Cost: US$600,030.

c. Crop Protection

(1) Insecticide Formul tion

Purpose--To make operational an existing latent capability toblend needed insecticidds. ScoTe--To blend more than 1,000 insecticide and distribute tons of 10% DDT it to farmers in drought-affected area:-. Implementation andTimin-- EPID will be itripl,.- menting agent. Certain the pieces of blending and crushir,:' ruchinery required and as soon as they ar: are in place blending can begin. It i:: estirpated that 6-7 tons can be produced per insecticide day. 1,10 tons of will cover 100,000 hectares with an estimated in yield net increace of 20,000 tons of food stliffs. U.S. P'--Machir.ery, local costs. Cost: US$30POOO. 27

(2) Control of Harmful Insects

Purpose--To establish an "early warning" system using light traps and other methods to identify an imminent insect buildup before there has been sufficient time for the numbers to mul­ tiply to uncontrollable levels.

Scope--To install and maintain light traps and instruct field agents in their use in identifying harmful insects, particularly the army worm moth, in the Southern Provinces where th: invasions normally first come into Ethiopia. In addition, stor:.; (f, insecticides would be disbursed and maintained and a "fire briwl,:" spraying network would be installed to be ruady to go ino acLion :: soon as first reports of insect manifestation were received.

Implementation and Timing--EPID would be the imple­ menting agent with technical support from the IAR which is already maintaining a few light traps in Southern Ethiopia. Since the normal infestation period is March through June, the necessary equipment should be in place and the training completed by March, 1975.

U.S. Inputs--Spraying dusting equipment, vehicles, local costs. Cost: US$1,000,000.

(3) Seed Cleaning

Puxpose--To provide seed cleaning because equipment to EPID of the lack of improved seed in the country necessary f',nr diL­ tribution bo MPP and drought-affected farmers. The :;eed i., ncr,::::* ry to increase local production of foodstuffs.

Scone--A one-time input of seed cleaning equipr,.nt valued at US$50,00 capable of handling seeds of the most important Ethiopian grains.

Implementation and Timin,7--EPID will be the imle­ menting anent. The machinery is required as soon as possible. The seed will be distributed through normal EPID channels including those now operating in the drought areas. Farmers in drought areas (in programs l.a. and 2.b. above) would receive the improved seed produced on a priority basis.

U.S. Inpus-- Seed cleaning equipment. Cost: US$50,000. d. Rural Roads

(1) Southern Provinces Penetration Roads

Purpose--To rapidly increase the accessibility of drought-affected areas of Southern Ethiopia by constructing low-cost, low-standard access roads in some of these areas.

Scope--The Ethiopian Government has designated five roads in the Provinces of Gemu Gofa, Sidamo, Bale and Harrarge, total­ ling 1,147 kms. for priority attention. The Relief and Rehabilitation Commission has also given their construction the highest priority. While these roads form part of what Fill eventually become the national primary road system, they are to be constructed initially to a very low standard in order that the maximum lengths of road be constructed for the money and time available.

Implementation and Timing--The Imperial Highway Authority will be the implementing agent. The Swedish International Development Agency (SIDA) has apparently agreed to fund one of these roads in Harrarge and the IHA will initiate work on two roads in Gemu Gofa and Sidamo as soon as the rainy season is over, commencing with funds already granted by the R&R Commission from its own budget. Work on the other two roads will commence within the next year.

U.S. Input--Local construction costs, and equipment. Cost: US$3, 500,000.

e. Projects Implemented by Priv3te Voluntary Orianizations

(1) Christian Relief Committee

Purpose--To provide financial assistance to projects designed and managed by PVO's in the drought areas which meet the criteria for rehabilitation projects.

Scope--There are more than forty religious and secular organizations providing assistance in the drought areas. lhe range of their activities is immense and the effectiveness and import­ ance of their work is undeniably large. The PVO's have .joined together to coordinate their activities in an umbrella organizatiorn, the Christian Relief Committee (CRC). This organization (whi.:h ;:: rot limited to missionary or church group membership) acts not oT1ly Lo vre,;p the PVO relief effort coordinated but also serves to channel contribul,(.. funds to worthy projects, anO as the point of contact between the 29

numerous PVO's, the R&R Commission, and the official, bilateral and international donors.

Tho projects currently being implor.ntr-d by PVO':: include both reliefr and recovery/reconstruction a(!tiv!L1(t-::. '1'w, l.l.,v inr:ludes rural road construction, well-drillinrt, ::er!d :jrid oxi,'* ,'i;:­ tribution to destitute farmers, the development, of' ve,.L7Lh plol:: , supplement the normal diets, and non-fori:l education, to narv_ a few. These organizations are in need of additional finan­ cial resources in order to carry out on-going and planned rehabilita­ tion projects. Implementation and Timing--The CRC is coordinating the development of an integrated package of rehabilitation type assistance projects for which partial funding is being sought from donor governments. Some of the projects will involve the expansion of on-going activities and others will be new starts. All will be of relatively short-term duration and managed by field agents of member groups of CRC.

U.S. Inputs--Financial support to partially cover the costs of eligible projects. Funds would be channeled through the. CRC with the approval of the IEG's R&R Commission. Cost: US$750,000.

c. The above listing represents proposals now in hand which appear to meet, or to be likely to meet after negctiation and some redesign, the criteria established for eligibility for AID R&R funding. It is anticipated that other proposals will be submitted during the next few weeks which would also be eligible for U.S. funding. To the extent that unsubobligated funds would be available and to the degree which they met the established criteria, such sub­ sequent proposals would also be considered for funding.

4. Regular Prozraam Responses

The AID development program for Ethiopia over the next several years is described in the Mission's Development Assistance Program (DAP) submitted to AID/Washington in April, 1974. Its dimn is to direct AID-managed resources into prorramz and projectc irn Ethiopia which will benefit Ethiopia's peasant farmer.,, who ,on:ti.. tute the preponderant majority of the country's rural poor. EL',0fiy percent of these peasant farmers live in the highlands--half a., tenants and half as farmers on their own lands. The remaining twenrty percent live in the lowlands as nomads, semi-nomads and cultivators. The regular program is aimed at helping increase small farmer 30 productivity and income at developing increased employment oppor­ tunities in the rural areas.

Specifically, the program is aimed at overcominlg cerlL8iTI key constraints, identified in the DAP, which have impeded (and will continue to impede) progress in improving the lot of Ethiopia's rural poor. The R&R program, by comparison, is aimed specifically at helping the drought-affected population to recover, to the extent possible, what has been lost (including lost productive capability) and at accomplishing whatever is possible of accomplishment in the short term, in the way of improving the ability of these people to withstand the effects of continued or resumed drought conditions. As shown below, there are ways in which the regular program is helping, and can increasingly help, to attenuate the effects of the drought, 'ut the regular program is not designed to focus to the extent now required--and in the time frame now required--on the drought areas, or the drought-affected population.

AID's normal development projects/programs now being implemented, or soon to commence implementation, which benefit drought areas include:

a. Agriculture Sector Loan

This is a macro sector budget support loan. It provides net additional resources to the Government which are used to finance eligible capital budget expenditure in rura. development, agri­ culture, rural road construction, etc. A number of drought-relatcd IEG activities are in categories eligible for drawdowns against the ASL instrument. Capital budget allocation to the R&R Conrnission (currently totalling Eth$4 million) are in this category as are rura] road construction in drought-affected area.s (Eth$5 million), and Ministry of Agriculture activities such as the Planning Unit (Eth$2 million), the Southern Rangelands Development Project (Eth$3 million), Soil and Water Conservation (Eth$1 million), and Terracing and Afforestation (Eth$3 million). Also included is the Ministry of Land Reform's low-cost settlement scheme (Eth$5 million) which has dir' ct relevance for drought-affected persons.

b. Rural Agriculture Development

Two of the experts provided to EPD under this tech­ nical assistance project have been largely responsible for developing the EPID drought rehabilitation projects in surface water and crop protection. 31 c. Agriculture Sector Planning

A senior technician provided to the Ministry Agriculture has been of instrumental in developing the IEG's Grain Storage and Marketing proposal to be presented to the World Bank Group and AID. It will eventually develop a national system of grain storage (as well as a national grain marketing system) which lacking. The system would is now greatly enhance the Government's capability to pre-position strategic reserves of grain for drought emergency use. d. Pulses

An agreement has recently been ment providing signed with the Govern­ U.S. assistance to the EG's Pulses Diversification and Imrprovement Project. Small farmers in Minimum Package Project areas in pulse growing districts of Ethiopia are to be given assistance in adding pulse crops to those already grown. Many of the pulse grow­ ing districts are in drought-affected regions (Eastern Escarpment and Harrar areas) and eventually several thousand small farmers in these regions will be receiving assistance under the Pulse Project. e. Southwest Development

AID is financing a feasibility to lead to a development study which is likely project in Southwestern Ethiopia, increase the long-run which would productive capability of selected areas enhance their ability and to withstand the effects of future droughts.

f. RuralRoads

The Mission in cooperation with IBRD and nce from with assist­ RII'DSO/EA is soon to begin developing a Paper for a proposed Capital Assistance loan to the LEG for rural road construction. These would be low-cost, low-standard roads hitherto inaccessible designed to open up areas of rural Ethiopia. A high be priority will given to roads in the drought areas.

g. Other Possibilities

As indicated in the Introduction to the Budget Submission, and FY 1976 in the DAP, the Mission is enga-red in det,:rnr,­ ing the shape of other longer-term U.S. assistance to Ethiopian drought-affected areas. A number of possibilities arc under tion including a financial con:i'd,;r.­ contribution to the proposed IBFtD Rangelands project, an Zouthn:rrj augmented ASL to increase resourcec availtle to the lEG in its own efforts to find long-term so)lutions drought, increased assistance to the to EPID to enable it to expand ito agri­ culture production services more rapidly into the drought areas, and others. 32 Tho M... iOll will coordinate its regultir Loi i--.orm program pluniiL[T,1 fur drou1±,,1,L iLLeviation with other Culltilu, to, iuivolvod donor.:: :,I wiLI work clo:.ly with IF(, j6TenceO:, 'r,,:.clw,:: long-term drought planning. n!v()Iv'' III AID/Wshingto2 will lo kopL 'onl;tLu:1.l.y ead completely informed. 34 With the exception of certain problems the still unresolved, emergency relief effort is succeeding and most starvation been brought has to a halt. The IEG R&R Commission is now actively engaged in the preparation of recovery and rehabilitation programs designed to help correct the inherent causes of famine. The USAID and other donors are working closely with the Commission during this planning stage.

In June. a review of possible rehabilitation projects made by AID/W was economists, working with Mission staff, and profiting from AID experience in the Sahelian countries. Meetings were with held various ministries and agencies to determine capabilities, resources and requirements for recovery projects. Results of the review were discussed with the R&R Commissioner who agreed with the overall categories of projects identified (Section C.2. above).

Each R&R proposal has been assigned a Mission member staff whose job is to work together with the R&R Commission indicated and the implementing agent to staff out the proposal, deteraine whether or not it meets the necessary criteria for consideration, and to redraft it in a format suitable for formal agreement. This is currently work in process. Once implementation is underway, these designated officers in the Mission's Drought Relief and Agriculture Section or Food Office will be responsible for all necessary monitoring.

The technical supervision of each of the activities will approved be provided by the designated implementing agency-­ either an agency of the lEG, or, in the case of PVO's, as by the Christian designa+:-d Relief Committee. The requirements for staff 2upport by AID will be minimal. Technical implementing personnel will be supplied by the IEG, PVOs, other donors or the Peace Corps. The number and skills of E ch personnel required to effectively utilize AID resource inputs w:'l be determined and agreed to prior to execu­ tion of each specific activity agreement.

In caseswhere a particular skill is desperately and not available needed in time from any other source, AID may agree to supply thte skilled individual required on a TDY or consultant basis for a limited time.

2. Procedures Host country financial contributions will not be a con­ dition of AID assistance. This is appropriate given the nature of the problem, i.e., a continuing disaster, and its impact on the lEG's fiscal position. 35 It is proposed that a single Agreement be negotiated with the Relief and Rehabilitation Commission of the IEG. (See Annex A.) The Agreemeit would include the following: - A description of the purpose of the grant, i.e. to provide additional financial resources in support of recovery and rehabilitation activities.

- A description of the progress reporting and general dis­ bursement procedures to be utilized.

- Description of the host government's covenants and warranties:

(a) Exemption of goodsand services from taxes and tariffs;

(b) Audit records and right of inspection although with a terminal date for end-use accountability-­ such records to be kept by the Government's authorized representative;

(c) Explicit recognition that AID is providing supple­ mental financing for recovery programs for which the Government assumes responsibility for successful execution and completion. - Agreement to make refunds to AID if funds are not expended a­ certified in disbursement requests.

- Specify the designated representative of the Government and of AID.

- Specify that attached to the Agreement are two Annexes: One describing illustrative activities; and the other indicating the format of the Activity Implementation Agreements. The annexes may be amended, by mutual agreement, by the issuance of an Implementation Letter by AID.

- Specify further that prior to disbursements ass3ociated ".-ith particular elements of a recovery program, the Government shall, except as AID may otherwise agree in writing, furnish to A­ in form and substance satisfactory to AID: a description, work plan and summary budget for those activities to be unrler­ taken and which are listed in the Annex to the Grant Ajvreenv-nt. AID approval, in summary or particularized, will bc cont:inTjrd in an Activity Implementation Agreement signed between ALI) and the implementing agency with concurrence by the Itelie' 36 and Rehabilitation Commission, which thc description, will incorporate work plan and summary budget and which will contain disbursement and other implementation procedures. Disbursements, subsequent Activity to signature of the appropriate Implementation Agreement and any advance be made by the USAID/Ethiopia agreed upon, will Controller to the Relief and Rehabili.­ tation Commission upon evidence actual submitted to the USAID Controller that expenditures have been made in Pursuit the grant. of the conditions of Such evidence shall include certified those activities expenditures on listed in Annex A to the been undertaken. Grant Agreement as may have Disbursements subsequent to be equal to the any advance payment shall amount thereby proved to have been expended. accounts will be maintained Separate by the USAID Controller for such together with the supporting activities documentation, certified by the implementing agency representative. authorized The USAID Mission will not documentatior submitted for payment certify since it does not assume respon­ sibility for the successful execution and completion of activities in recovery programs.

To summarize, a Government grant to augment the resources of the is proposed to enable it to activities undertake drought-related it would otherwise have been unable will be a restriction to undertake. There on disbursements which will assure tures have actually that expendi­ been made for such activities. Documentation include three basic types: (a) will a description of each activity, (b) proposed summary budget for each activity, as AID may and (c) such status reports require. Financial documentation would extent possible be minimized to the and naintained by the Relief and Rehabilitation Commission.

3. SpecialDe'.erminations

Section 639(A) (b) of provides the Foreign Assistance Act of 1973 considerable flexibility in the establishment of the Recovery and implementation and Rehabilitation Program. Specifically, the Agency to develop it allows implementation procedures for purposesof Section without the rigid application the of many of the requirements of the Foreign Assistance Act and other to foreign laws that would otherwise aopiy assistance undertakings and which may mental to effective, be actually detri ­ expeditious and sound transfer of resources assist in the recovery and rehabilitation -o of Ethiopia. of drought-afflicted areas For example, many of the reouirements designed to affect of the Act are traditional commodity and capital assistance activities. To the extent those requirements are not relevant implementation of Section 639(A) to the (b) of the Act, they will not be 37 included in the various Grant Agreements and other implementing docu­ ments. In short, the flexibility already accorded the utilization of Contingency Funds should be judiciously employed in the recovery program as well.

To the extent existing sections of the Act and oLhor laws represent judgments with regard to prudent manalemcnt and r, '.V1 L obvious public sensitivities, they will be included. There tr fIirr: specific determinations, however, which are sought to facilitat,e­ program implementation which require explicit definition.

As was the case in the Sahel, to effectively implement the Ethiopian Recovery and Rehabilitation Program, which is designed to be quick action and high impact, it will be necessary to permit free world procurement (Section 604, FAA) including free world procurement of vehicles (Section 636(i), FAA). The rationale is almost self­ apparent.

- Prompt implementation is critical to program success. In fact, the entire program is truly a race against time, vis-a-vis emergency road construction to allow for land shipment of grains to remote areas of the country, surface water development, well digging, making improved seed available to the drought-affected farmers, expanding crop producti.on acreage, development of an early warning system against insect invasions, etc. In this circumstance, local cost financing is obviously an absolute necessity. in addition, in cases where off-shelf procurement is necessi­ tated by the time factor, and if in the view of the 1.!is:i:on the situation warrants off-shelf procurement, such procur - ment will be specifically authorized in the Implementation Activity Agreement or by aendment to such Agreement;

- It must be emphasized that AID resources are supplemental to other Government, international donor and voluntary agency activities and are not sep:irate AID implemented activities. In this instance as above, compatibility is absolutely essential;

- The management design for the program does not make pro­ vision for U.S. drafting and review of specifications (except obviously for significant procurement such as heavy earth moving equipment, etc.) nor does it lend itself to the preparation and submission of individual source waivers (which would require a degree of activity knowledge incompatible with the other-source management posture).

In this ciTrcumstance, it would also be desirable to 'Ar7m­ nate cargo preference requirements as included in the Merchant Marine 38 Ac ci' ,L936. Stncu the requirement relatc- to the Aqc~vny with to ito igross transactions re ' rard and is not by law a:otivity LpeCf[b., :mid since procurement would be largely off-shore, it is not deemed practical to include this usual AID requirement. As discussed above, timely procurement is critical to the proposed program. Various alternatives have been considered, including the Capital Project Guidelines and IDA procedures. All con­ tracts for goods and services exceeding an estimated $100,000 each would be procured through irkrnational competitive bidding. Contracts involving expenditures estimated at more than $10,000 but less than $100,000 would be procured through local competitive bidding, and direct procurement would be permitted for contracts costing less $10,000. It is determined than that the inclusion of a "reasonable price" clause in the Grant Agreement is sufficient to assure "fair practice" given the situation where ua:ual Government or other donor procurement practices will be employed. Of course, where that situation does not prevail (and the program is designed to assure adherence to "other management" normal practice), the USAID Mission may require specific procurement practice as incident to signature of Activity Implemen­ tation Agreements. On this basis and to assure timely implementation, the USAID/Ethiopia Mission Director will be authorized to approve negotiated procurement, proprietary procurement as required and waiver of advertisement requirements. ANNEX A

ETHIOPIA DROUGHT RECOVERY PROGRAM

GRANT AGREEMENT

AGREEMENT, dated between the Imperial Ethiopian Government ("Government") and the United States of America acting through the Agency for International Developnent ("A.I.D.");

WHEREAS, Ethiopia has recently suffered and is continuing to suffer a disaster in the form of drought of major proportions which has caused and continues to cause widespread damage and human suffering; and

WHEREAS, the Government has undertaken a program of drought re­ covery and rehabilitation; and

WHEREAS, it is apparent that the magnitude of the Government's drought recovery and rehabilitation efforts are beyond the financial resources of the Government; and

WHEREAS, the United States of America in a spirit of friendship and cooperation with the people of Ethiopia desires to assist the Govern­ ment's efforts in the ardDus task of recovery and rehabilitation;

NOW THEREFORE, the parties hereto agrees as follows:

ARTICLE I

The Grant

SECTION 1.1. Purpose of the Grant. A.I.D. hereby agrees to grant to the Government, subject to the cdnditions hereinafter set forth, an amount not to exceed Eight Million U.S. Dollars (US$8,000,000) ("Grant") to assist the Government in carrying out the Program referred to in Section 1.2 ("Program") for drought recovery and rehabilitation in Ethiopia.

SECTION 1.2. The Program. The Program shall consist of particular relief and reabilitation activities ("Activities") undertaken or caused to be undertaken by the Government in the following areas:

(a) Livestock and water, (b) Agriculture and settlement, (c) Crop protection, (d) Rural roads, (e) Private voluntary agency rehabilitation projects. AINNEX A

The Program is more fully described in Annex A, attached hereto, Annex may be modified in writing which by issuance of an Implementation Letter pursuant to Section 7.5. SECTION 1.3. Eligible Activities. Goods and services required carry out listed Activities to in Annex A, attached hereto, may under this Grant be financed subject to the reptrictions indicated Agreement elsewhere in this and in any Implementation Letter issued pursuant to Section 7.5.

ARTICLE II

Conditions Precedent to Disbursement SECTION 2.1. Conditions Precedent to Disbursement. Prior first disbursement to the Relief to the and Rehabilitation Commission (Commission), the Government shall, except as A.I.D. may otherwise agree in writing, furnish to A.I.D. in form and substance satisfactory to A.I.D.: (a) The name of the person or persons designated as the representa­ tive or representatived of the Government pursuant to Section 7.4. and a specimen signature of each such person; (b) Such oteir documents as A.I.D. may reasonably request. SECTION 2.2. Conditions Precedent to Disbursement for Activities. Prior to the first disbursement by the Commission for any specific Activity, the Government shall, except as A.I.D. may otherwise agree in writing, furnish to A.I.D., in form and substance satisfactory to A.I.D.: (a) A description of the Activity, chosen from those Activities illustrated in Annex A, to be undertaken or caused to be undertaken by the Government and supported in whole or in part of this Grant; (b) A budget and projected work plan for that Activity and an estimate of the time required to carry it out; and (c) Identification of the proposed administrative and implementing agency for the Activity.

SECTION 2.3. Notification of Meeting of Conditions Precedent. A.I.D. shall notify the Government in writing when the Conditions precedent to Disbursement specified in Sections 2.1 and 2.2 have been met. SECTION 2.4. Signing of Activity Implementation Agreement. Upon meeting Conditions Precedent to Disbursement specified in Sections 2.1 and 2.2, an Activity Implementation Agreement shall be signed between the USAID/Ethiopia Mission and the designated Implementation Agency with concurrence by the Relief and Rehabilitation Commission. Such Agreement will be in a format as shown in Annex B, attached hereto.

2. ANNEX A

ARTICLE -III

General Covenants and Warranties SECTION 3.1. Covenants. The Government, in consideration Grant, of this hereby covenants and agrees that: (a) The Government explicitly recognizes that supplemental financing A.I... is providing for the Program for which the Government responsibility assumes for successful execution and completion. (b) The Government shall use its best efforts to be carried to carry out or cause out the Activities financed hereunder efficiency with due diligence and and in conformity with sound engineering, financial and admin­ istrative practices.

(c) The Government and A.I.D. shall cooperate the fully to assure that purpose of the Grant will be accomplished. and A.I.D. To this end, the Government shall from time to time, at the request of either party, exchange views through their representatives with regard to the progress of Program and the implementation the of Activities financed by this Grant. (d) If A.I.D., or any public or private organization furnishing commodities through A.I.D. financing for operations hereunder is under the law, in Ethiopia, regulations or admnistrative procedures liable for customs of Ethiopia, duties and import taxes on Ethiopia commodities imported into for purposes of carrying out pay, this Agreement, the Government with funds other than those provided will under this Grant, such duties taxes on those commodities and unless exemption is otherwise provided. (e) If any personnel (other than citizens and residents whether United States of Ethiopia), Government employees, or employees private organizations of public or under contract with A.I.D., agency authorizcd the Government or any by the Government, who are present services in Ethiopia to provide which A.I.D. has agreed to finance under this Agreement, are under the laws, regulations, or administrative procedures of Ethiopia, Ci) liable for local income or social security taxes with upon which they are obligated respect to income to pay income or social security Government taxes to the of the United States, or personal (ii) liable for property taxes on property, or any tariff or duty upon personal or household goods brought into Ethiopia for their personal use, the Government shall with funds other than those provided pay, under this Grant, such taxes, or duties tariffs, unless exemption is otherwise provided.

Cf) The Government shall make such arrangements as so that funds introduced into Ethiopia may be necessary by A.I.D. hereunder shall, be con­ vertible into the currency of Ethiopia at the highest rate which, time conversion at the is made, is not unlawful in Ethiopia.

3. ANNEX A

ARTICLE IV

Records, Reports and Inspection

SECTION 4.1. Maintenance and Audit of Records. The Government shall maintain, or cause to be maintained, in accordance with sound accounting principles and practices consistently applied, books and records relating to the Program and this Agreement. Such books and records shall be adequate to &how:

(a) The receipt and disposition made of goods and services acquired with funds disbursed pursuant to this Agreement; and

(b) The current status and progress of the Program.

Such books and records shall be regularly audited, or caused to be audited by the Governmaent in accordance with sound auditing standards and shall be maintained for three years after the date of the last disbursement by A.I.D.

SECTION 4.2. Reports. The Government shall furnish, or cause to be furnished, to A.I.D. such information and reports relating to the Grant as A.I.D. may request.

SECTION 4.3. Inspections. The authorized representatives of A.I.D. shall have the right at all reasonable times to inspect the Activities carried out under the Program, the utilization of all goods and services financed under the Grant, and such books, records and other documents relating to the Program and the Grant as may be maintained by the Government, the Government's designated disbursing agent and/or imple­ menting agency. The Government shall cooperate with A.I.D. to facilitate such inspections and shall permit representatives of A.I.D. to visit any part of Ethiopia for any purpose relating to the Grant.

ARTICLE V

Procurement

SECTION 5.1. Source and Origin. Except as A.I.D. may otherwise agree in writing, disbursements made pursuant to Section 6.1 shall be used exclusively to finance the procurement for the Program of goods and services, ocean shipping and marine insurance having their source and origin in Ethiopia, the United States and/or other countries included in Code 935 of the A.I.D. Geographic Code Book as in effect at the time of such procurement.

SECTION 5.2. Eligibility Date. Except as A.I.D. may otherwise agree in writing, no goods or services may he financed under the Grant which are procured pursuant to orders or contracts firmly placed or entered into prior to August 1, 1974.

4. ANNEX A

SEX(!ITlN 5.3. Reasonable Price. The GovermienL shnll exerl Its best efforts to assur;ethat no more than reasonable )rices s4hall he paid for any goods and services financed, in whole or in parL, uiiider this Grant.

SECTION 5.4. Information and Marking. The Government will cooperate with A.I.D. in its efforts to disseminate appropriate infor­ mation concerning the Program and shall comply with such reasonable instructions with respect to the marking of goods financed under the Grant as A.I.D. may issue from time to time.

SECTION 5.5. Insurance. Except as A.I.D. may otherwise agree in writing, the Government shall insure, or cause to be insured, all goods financed under the Grant against risks incident to their transit to the point of their use in the Program. Such insurance shall be issued upon terms and conditions coLz.::tent with sound commercial practice, shall insure the full value of the goods, and shall be payable in the currency in which such goods were financed. Any indemnification received by the Government under such insurance shall be used to replace or repair any material damage or any loss of the goods insured or shall be used to reimburse the Government for the replacement or repair oI such goods. Any such replacements shall be of local, United States or other Code 935 source and origin and otherwise subject to the provisions of this Agreement.

SECTION 5.6. Utilization of Goods and Services. (a) Goods and services financed under the Grant shall be usedTforthe Program, except as A.I.D. may otherwise agree in writing. The Government's accountabi­ lity to A.I.D. for the use of such goods and services shall extend to the completion of the Activity or to such other time as A.I.D. may specify in Implementation Letters.

(b) Goods or services financed under the Grant may be used in concert with the drought related projects and activities of donor any other to assist in meeting the purposes of the Program.

ARTICLE VI

Disbursements

SECTION 6.1. Disbursements for the Program. Upon of conditions precedent, satisfaction the Commission may, from time to time, request disbursements by A.I.D. to finance costs of goods and services for the Program. The Commission will make expenditures authorized under this Grant and furnish A.I.D. with such information, reports and other disbursement documentation, relating to Activities financed under this Agreement, as A.I.D. may reasonably request for purposes of reimbursement.

5. ANNEX A

TO THE GOVERNMENT:

Mail Address:

Cable Address:

TO A.I.D.:

Mail Address:

Cable Address:

7.3. Other addresses may be substituted for the aboi giving of notice as provided herein. All notices, request, commt tions and documents submitted to A.I.D. hereunder shall be in Eng except as A.I.D. may otherwise agree in writing.

SECTION 7.4 . Representatives. For all purposes relative i this Agreement, the Government will be represented by the indivic holding or acting in the office of Chief Commissioner, Relief ar Rehabilitation Commission, and A.I.D. will be represented by the vidual holding or acting in the office of the Director, USAID/Et- Such individuals shall have the authority to designate by written additional representatives. In the event of any replacement or c designation of a representative hereunder, the Government shall s a statement of the representative's name and specimen signature i and substance satisfactory to A.I.D. Until receipt by A.I.D. of notice of revocation Pf the authority of any of the duly authoriz representatives of the Government designated pursuant to this Sec it may accept the signature of any such representative or represe as conclusive evidence that any action effected by such instrumen duly authorized.

SECTION 7.5. Implementation Letters. A.I.D. may from tim time issue Implementation Letters that will prescribe the procedu applicable hereunder in connection with the implementation of thi Agreement.

SECTION 7.6. Termination. The present Agreement shall en into force when signed. Either party may terminate this Grant Ag by giving the other party 30 days written notice of intention to terminate it. Termination of this Agreement shall terminate any tion of A.I.D. to make disbursements pursuant to Section 6.1 or 6 except for disbursements which A.I.D. or the Government is commit make pursuant to noncancellable commitments entered into with thi parties prior to the termination of the Grant Agreement. It is e understood that the obligations under Sections 5.6(a) and 6.4 sha remain in force after such termination.

7. Country: Ethiopia Grant No.: Implementation Letter ANNEX B No.: Date:

BASIC IMPLEMENTATION LETTER

Dear Sir:

This letter sets forth the procedures for utilizing the.Grant Funds and provides information and guidance to assist in satisfying conditions precedent to disbursement and implementing activities in conformity with the Grant Agreement. Except as provided in the Agreement nothing in this letter or its attachments alters the scope of the Agreement or the terms of the specific sections that are referred to or explained in this letter. Instructions in this letter and attachments may be supplemented modified by subsequent and/or Implemontation Letters. It will be the responsi­ bility of the Government, with whatever assistance may be requested of A.I.D., to assure that information related to the implementatinn of the Program and the Program activities is promptly made available to all interested and affected parties, particularly those upon whom obligations of the Government may devolve, including the Relief and Rehabilitation Commission ("Commission"),'implementing or executing agencies, contractors and suppliers.

I. The Program (Article)

Annex A to the Grant Agreement describes the Program to be assisted by A.I.D. and establishes levels of funding for five broad categories or sectors of assistance. Annex A also provides a list of activities within these five sectors which are eligible for financing under the Agreement. These sectors and the activities within them comprise a recovery program which is intended to satisfy the following criteria:

(i) can be swiftly initiated and rapidly completed; (ii) will produce results in one to two years which have significant and measurable impact in pro­ moting recovery from the effects of the drought; (iii) will assist in mitigating or forestalling emer­ gency conditions in future years of irregular and insufficient rainfall; and

(iv) will contribute to recovery in the short-run in such a way as to establish a base for long-run de ielopment.

1. ANNEX B

Final selection and design of program activities and selection of their respective executing agancies, will be made in close cooperation and consultatinn between A.I.D. and the Commission.

II. Conditionb precedent to.Use of Grant Funds (Section 2.1)

a. The names of the person or persons who will act as the repre­ sentative of the Government shall be provided to the A.I.D. representa­ in Section tive in a letter signed by the person holding the office named the per­ 7.4 of the Agreement. Specimen signatures (three originalt) of sons so names should accompany the letter. and b. The Government should designate in writing that the Relief and disbursing Rehabilitation Commission will be responsible for receiving be accom­ funds provided under th.s Agreement. This designation should role panied by evidence that the Commissiop understands and accepts the it is expected to perform.

At such time as the conditions of this section have been satis­ the disbur­ fied, A.I.D. will be prepared to make an advance of funds to In­ sing agent designated pursuant to Section 2.1' of the Agreement. request formation relating to the timing, amount and preparation of the for the advance is provided in Sectioh VI.A of this Letter. (Section 2.2) B. Conditions Precedent to Disbursement for Activities

The conditions listed in this section may be satisfied on that an activity-by-ictivity basis. As soon as A.I.D. has determined is sufficient descriptive, budgetary and administrative information Agreement available for a particular activity, an Activity Implementation detail as necessary will be signed for that activity setting forth in as much to the a description of the activity, including its purpose, relation line-item drought, an estimate of total activity costs; a budget showing work plan for costs to be financed under the Grant Agreement; a general to be the total activity and an implementation schedule for the portion adminis­ financed under the Grant 4greement; and identification of the the activities. trative and implementing agency responsible for carrying out procurement and The Activity Implementation Agreement will also specify the Govern­ disbursement procedures to be followed, and will be signed by the implementing ment's designated representative and by a representative of the agency (if different from the Government's representative).

C. Representatives and Agents

It is envikaged that for purposes of carrying out the Program and the activities to be financed thereunder there will be essentially three roles to be performed by the Government's designated representatives, agents and implementing agencies. 2. ANNEX B

First, pursuant to Section 7.4, is the person or persons who will be designated by the Government to represent the Government in all matters relating to the Agreement. These include, for example, official correspondence with A.I.D. concerning interpretation of the Agreement and issuance of implementation letters, satisfaction of conditions to disbursement, compliance with covenants and warranties; submission of reports; and signing of all documentation requiring a Government certifi­ cation.

Second, is the Commission which is to be designated by the Government, as the Government's disbursing agent in accordance with Section 2.1. An individual or individuals within this institution should be named (and specimen signatures provided) to furnish the certi­ ficatiou required in accordance with agreed upon disbursement procedures. Third, is the designated implementing or executing agency for each individual activity. This agency, to be identified by name of the organization and its representative in the Implementation Agree­ ments for individual activities, may, for example, be a ministry of the Government, an international organization, a voluntary agency, etc., depending upon the design and nature of the particular activity. Note that in certain cases the Government representative and the representa­ tive of the implementing agency may be one and the same if the parties involved so agree.

D. Notification of Meeting of Conditions Precedent (Section 2.3) At such time as the Conditions Precedent to Disbursement specified in Section 2.1 are satisfied, A.I.D. will so advise the Govern­ ment in writing. With regard to Section 2.2, a separate written noti­ fication will be issued upon satisfaction of the conditions for each individual activity.

E. Activity Implementation Agreement (Section 2.4) Upon satisfaction of all Conditions Precedent to Disbursement for an individual activity, A.I.D. and the implementing agency will sign an Activity Implementation Agreement in a format similar to that shown in Annex B to the Grant Agreement. Concurrence by signature of the and Rehabilitation Relief Commission is required on each such Activity Implementation Agreement. Only upon signature of the Activity Implementa­ tion Agreement may the Comniission advance funding as indicated in the Activity Implementation Agreement to the implementing agency.

3. ANNEX B

III. General Covenants and Warranties (Article III)

Article III of the Grant Agreement contains a series of covenants applicable to the manner in which the Government of Ethiopia conducts the Program and uses the funds provided by the Grant. These covenants are largely self-explanatory; however, attention is directed to the following specific requirements in particular:

A. Continuing Consultation (Section 3.1(c)

The Grant Agreement provides that consultation shall take place from lkne to time at the request of either party. A.I.D. wishes to co­ operate fully in such exchange of views concerning the progress of the program, compliance with the provisions of the Grant Agreement, and any other matters of mutual concern. In addition, A.I.D. wishes to assure the Government of Ethiopia that its representative is always available for informal discussions.

B. Taxes (Section 3.1(d) and (e))

The following additional information is provided to assist you in carrying out the provisions of these Sections:

1. The provisions of section 3.1(d) do not apply to the procurement of those items which are normally imported and kept in stock in the form in which imported for sale to meet a general demand in Ethiopia provided they have been imported from a country included in Code 935.

2. For purposes of Section 3.1(e), a "permanent resident" is defined as a person who is not a citizen, yet has been physically residing substantially uninterrupted for more than three (3) years in Ethiopia.

IV. Records, Reports and Inspections (Article IV)

A. Maintenance and Audit of Records (Section 4.1)

1. It should be noted that in addition to such books and records as the Government itself may establish and maintain, it will also be incumbent upon the Govern­ ment to assure that its designated financial agent similarly maintains adequate records of all finan­ cial transactions undertaken with respect to this program, including copies of all pertinent docu­ mentation required for disbursement of funds.

4. AINEX B

2. It is expected that books and records maintained by government institutions and by the disburse­ ment agent for this project will be audited on an annual basis by a qualified independent accountant either government or private.

B. Reports (Section 4.2)

1. The Government shall submit to A.I.D. on a quarterly basis a report showing the current status of the program's implementation. This report shall include but not necessary be limited to the following informa­ tion: general status of Program implementation, including funds received and expended, brief identifi­ cation of activities approved for financing (by name and number), amount approved for Grant financing, amount expended, status of completion, and discussions of any problems impeding progress. A suggested format for this report is provided in Attachment A.

2. Financial Status Report

The Government shall submit to A.I.D. monthly a report showing for each activity the approved line item budget, total expenditures to date and local currency expenditures to date in U.S. dollar equivalents. It is expected that this report will be prepared for the Government by the Commission (See Attachment A).

3. Activity Reports

a. Progress Reports

The Government shall submit to A.I.D. quarterly a report on each activity financed under the Grant Agreement including an activity description, implementation status, physical progress, major accomplishments, delays and bottlenecks, etc.

b. Completion Reports

A final report on each completed activity should be presented to A.I.D. no later than ninety (90) days from the date of final disbursement for that activity.

5. ANNEX B

It is expected that the activity progress and completion reports will be prepared for the Government by the implementing agents. Addi­ tional institutions with regard to the pre­ parftion of these reports will be furnished in the activity implementation agreements.

4. Audit Reports

Copies of reports of the audit required under Section 4.1 of the Agreement should be made available to A.I.D. upon request.

V. Procurement (Article V)

A. Source and Origin (Section 5.1)

Goods and services financed under this Agreement may have their source and origin in countries listed in A.I.D. Geographic Code 935. (See Attachment B).

Source is defined as the country from which items are shipped to Ethiopia, or to a Free Port or Bonded Warehouse when these items are transhipped from there to Ethiopia in the same form as received.

Origin is the country in which goods have been mined, grown or produced through manufacturing, processing or assembly. In the case of manufacturing, processing, or assembly, the finished product must be'a recognized new commodity, substantially differ­ ent in characteristics, purpose or utility from any of its components.

B. Reasonable Prices (Section 5.3)

In order to assure maximum utilization of the funds provided under the Agreement, A.I.D. expects that the Government of Ethiopia will take whatever steps it considers necessary and appropriate to assure that procedures used for procurement of goods and services are to the extent possible designed to produce the kwest price available, provided, however, that timely execution of the program will not be unduly hampered. Compliance with this Section can generally be achieved by assuring.that goods and services are procured by means of normal commerican practice and/or government procurement in Ethiopia.

6. ANNEX B

C. Information and Marking (Section 5.4)

The Grant Agreement provides that the Government of Ethiopia will cooperate with A.I.D. in its efforts to disseminate information concerning the Program. To the extent appropriate, therefore, all publicity concerning activities financed by Grant funds should mention the role of A.I.D.

D. Utilization of Goods and Services (Sectioa 5.6)

A.I.D. expects that goods and services financed under the Agreement will be used to support accomplis ;, :t of the purposes for which they were provided, and - used in other non-Program activities to the detriment of the Program.

The period during which A.I.D. will expect the Government to be accountable for the goods and services financed under the Agreement will be specified in the implementation agreement for each activity.

VI. Disbursements (Article VI)

A. Advance to the Disbursing Agent

Following execution of the Grant Agreement and satisfaction of conditions to disbursement contained in Section 2.1 of the Agreement, A.I.D. will be prepared to provide the Commission with an advance to cover the time element required to permit timely processing of requests for reimbursement. Theanount and timing of this advance, to be mutually agreed upon by A.I.D. and the Government, will be based upon estimated funding requirements for the initial 90 days of operations. Any interest accruing to this advance shall be for the account of the United States Government and shall be forwarded quarterly to A.I.D. by dollar check.

The request for this advance (Attachment C) should be accompanied by A.I.D. Standard Form 1034, "Public Voucher" for Purchases and Services Other Than Personal" (Attachment D), and should be signed by representatives of the Commission and submitted in an original and three copies to the Controller, USAID/Ethiopia who will then issue an Ethiopian dollar check for the amount of the advance requested.

7. ANNEX B

B. Disbursements for Program Activities The Commission will activities be prepared to disburse only after signature funds for individual Agreement of the Activity which will include Implementation budget an identification for those goods of and a line-item financing and services which with the A.I.D. are eligible for advance, Grant Funds. Subsequent disbursements will to the iritial implementing be made upon presentation agent of by the the following documentation the designated representative certified by of the Commission. 1. For Compensation: A statement showing days and time worked and rate of pay. 2. For Reimbursable Procurement: Copies of original receipt, bills of lading and invoices. 3. For Contracts: Copy of the billing statement from the Contractor. sample certification A is provided in Attachment D. C. Replenishment From time to time the Commission the may request advance by requesting A.I.D. to replenish Controller, reimbursement USAID/Ethiopia, by submitting to the following the Voucher Form SF-1034 documentation: and identifying the the name of the amount to be reimbursed activity for which and a "decompte" funds have been prepared by the expended, summary of expenditures disbursement agent by line-item showing a priate activity's as detailed budget. These in the appro- by a certificL documents should inn that expenditures be accompanied in the or disbursements statement were authorized summarized of by the appropriate the government as representative(s) specified in the Agreement. A sample Activity Implementation decompte and certification are provided in Attachment D. The remaining sectionis of the Grant Agreement are to be self-explanatory. considered A.I.D. will be pleased may have to assist you with concerning the Agreement any questions or or this Implementation problems you attachments. Letter and its

Sincerely yours, MISSION DIRECTOR

8. ANNEX B

LIST OF ATTACHMENTS

A. Instructions for Reporting

B. A.I.D. Geographic Code 935

C. Request for Advance

D. Decompte for Reimbursement

E. Standard Form 1034

9. ANNEX B Attachment A

REPORTING REQUIREMENTS In accordance with Article we are IV, Section 4.2 requesting that you of the Grant Agreementi information adopt a reporting on the physical system which will financial progress provide program. made in carrying The reporting system out the will consist of: I. A Quarterly Program Progress 2. A Monthly Report Financial Status Report 3. A Quarterly Activity 4. Audit Progress Report Reports as may be requested from time 5. Activity to time Completion Reports Guidelines for the preparation of these reports are as follows: 1. Quarterly Program Progress Reort -- The Feport is to provide purpose of this information which regular assessment will permit a of the overall progress Recovery of the Program in Ethiopia. A. Reports are requested to be according prepared in six copies to the format attached, Samples 1 and 2. B. Reports are requested quarterly, according to the following schedule:

Reporting Period Due Date January 1 - March 30 April May 1 1 - June 30 July August 1 1 - September 30 October November 1 1 - December 30 February 1 C. Reports are to be submitted to th USAID Director due date by the indicated in B, above. 2. Monthly Financial Status Report -- The report is to purpose of this provide regular information on activities in the Recovery Program. A. Reports are requested to be prepared Agent by the Disbursing on each activity included be funded in the program to under the Grant Agreement. should be prepared Each report in six copies, according format to the attached, Sample 3.

10. ANNEX B ATTACHMENT A

B. Reports are requested monthly, and are to be to the UJAID submitted Director not later than the 15th of month following the the close of the preceeding monthly reporting period. 3. Quarterly Activity Progress Report -- The purpose o:f this report is to provide regular information on the status and progress of each activity in the progr&m to be funded under the Grant Agreemont. It is intended that the implementing institution or agency res­ ponsible complete this report. A. Reports are requested to be prepared in six copies, according to the format attached as Sample B. and 5. B. Reports are requested quarterly, and are to be submitted the USAID Director not to later than the due date indicated in the schedule below. These reports are due two weeks prior to the Quarterly Program Progress Reports: Reporting Paiod Due Date January 1 - March 30 April 15 April 1 - June 30 July July 15 1 - September 30 October October 1 15 - December 30 January 15 4. Audit Reports -- Information regarding the preparation and if these subLission reports will be provided as may be required. 5. Activity Completion Reports -- A final report is requested within 3 months of the final disbursement for any activity in the program financed under the Grant Agreement. This report will e prPJe in substantially the same form as the Quarterly Activity Re e in para. 3., above; the report will, however, be clearly marked "Completion Report".

11. Sample I Face Sheet ANNEX B

COUNTRY NAME

A.I.D. GRANT NO.

QUARTERLY PROGRAM PROGRESS REPORT

For Period

Frcm To

Reporting Office

12. ANNEX Sample 2 Format

COUNTRY NAME QUARTERLY PROGRAM PROGRESS REPORT Reporting Off:ice: "-Date: _ ----

I. P.rogran Status: This section should provide an overview of the iplementation pro-resp made during the period for the reporting program being financed ,the Grant Agreement. under What are being encountered the problems that affect of the program; the implenentation what actions have being taken been or are to address these are the protims? How well implementing offices/institutions executing and coordinating ficant their inputs? Signi­ changes that have reporting occurred during period should the be noted. Describe impact of the program the to date on the overall drought situation. II. Implementation- Specifically, with respect to the work and plan implementation schedules activity, set for each how well are the ties Individual activi­ financed under the those Grant Agreement meeting schedules? In which vities areas are the acti­ ahead or behind targets List each activity outlined? Why? with a brief summary m'nt state­ of its status above. III. Other Comments:

13. ANNEx B Sample 3 Formal

FINANCIAL STATUS REPORT

Country: A.I.D. Grant Activity No.: No.: Date Prepared:

For the Period Ending:

Budget Description Expenditures (Budget Amount to Date Line Item) (In Total U.S. $) (In U.S.$) Total In Local Currency Equivaleni

Totals:

14. NEX B Sample 4 'ace Sheet

COUNTRY NAME

ACTIVITY TITLE

ACTIVITY NUMBER

QUARTERLY ACTIVITY PROGRESS REPORT

A.I.D. GRANT NO.

For Period:

From To:

REPORTING ORGANIZATION

15. Sample 5 Format ANNEX B COUNTRY NAME ACTIVITY PROGRESS REPORT A.I.D. GRANT NO.

Date :

ExocuLl ng Organi zaLJon: Activity Title: Activity No.: Department: No.: Certifying Officer: Implementation * * *

describe the activity I. Activity Description: This section should and its overall purposes briefly. It should relate the activity specifically to the problem it is intended to address.

to the Implemen­ II. Implementation: Specifically, with respect tation schedule set forth, how well is this activity meeting target dates? In which areas is the activity behind or ahead of schedule? Why?

meeting its object- III. Objectives/Targets: How well is the activity ives? Targets and objectives which are quantifiable should be indicated and a brief outline provided of the major steps involved in reaching them.

stage reached in IV. Physical Progress: Describe the state or physical execution of the activity (amount of work completed, state of work in pro­ gress, staff trained, etc., as applicable) and relationship to accomplishment of (quantitative) targets and objectives.

V. Major Accomplishments with Respect to Over­ all Purposes: Describe fully. and causes; what were V1. Delays and Bottle- Describe the nature or to be taken? necks (if ny)-: the remedial actions taken are involved VII. Non-A.I.D. Inputs: What other essential inputs in this activity (Government, private, organization, religious, etc.)? Are their inputs on schedale? Are there delays or problems involving other donor inputs/ activity which relate to this activity? What is the nature of them?

VIII. Other Comnents:

16. ANNEX B Attachmont n3

A. I.D. GEOGRAPHIC CODE 935

SPECIAL FREE WORLD -- Any area or country in the Free World, including cooperating country itself.

Countries excluded from the Free World are as follows:

CUBA CHINA (Mainland) and Other Chinese Communist-Controlled Areas, mn.: Manchuria Inner Mongolia Tsinghai Province Sikang Province Si ukiang Tibet The Former Kmantung Leased Territory Th,! present Part Arthur Naval Base area Liaoning Province EASTERN EUROPE Albania Bulgaria Czechoslovakia East Germany (Soviet Zone of Germany and Soviet Sector of Estonia Berlin) Hungary La'.via Lithuania Romania KOREA, NORTH OUTER MONGOLIA POLANI UNION OF SOVIET SOCIALIST REPUBLICS (USSR) VIET-NAM (NORTH)

17. ANNEX B Attachment c

REQUEST FOR ADVANCE

Country,-, Grant No.: Date:

1. Pursuant t-) Section 6.1 of Grant Agreement No. dated , the Government of ------requests tha, the sum of hereby be deposited

2. The sum requested in the attached voucher represents estimated re­ quirements for 90 days of operations to permit timely processing of activity disbursement requests.

3. The Government of has been advised by letter dated A.I.D. in a that all conditions to disburse­ ment of this advance have been satisfied.

Name:

Title: (Authorized Government Representative)

Countersigned:

Name:

Title: (MISSION DIRECTOR)

18. ANNEX B Attachment D

.DECOMPTE FOR REIMBURSEMENT

Country: Grant No.: Reimbursement RequestN.: Date:

Expenditures for the Period: to:

Budget Total Description Amount Current to Date Period

Total

Reimbursement is hereby for requested in the amount of disbursements in connection with activity no. The undersigned certifies that expenditures being for which reimbursement is requested have been made in accordance and were with the Grant Agreement authorized by the duly designated representative of the Govern­ ment.

Signed:

Title:

Relief and Rehabilitation Commission

19. Attachment E Standard Form 1034 7 GAO 5000 PUBLIC VOUCHER FOR PURCHASES AND VOUCHER NO. 034-113 SERVICES OTHER THAN PERSONAL U.S DEPARTMENT, BUREAU.OR ESTABLISHMENT AND LOCATION DATEVOUCHER PREPARED SCHEDULENO.

CONTRACT NUMBERAND DATE PAID BY

REQUISITION NUMBERAND DAME

F

PAYEE'SNAME NAME DATEINVOICE RECEIVED AND ADDRESSL DISCOUNT TERMS

PAYEE'S ACCOUNT NUMBER

SHIPPEDFROM TO WEIGHT GOVERNMENT S/L NUMBER

NUMBER DATE OF ARTICLES AND DATE OR SERVICES DELIVERY (Eiter destriptrs. ilgtre irastr of cerosir, or IederI QUAN- OF ORDER OR SERVICE UNIT PRIE AMOUNT juppl ichdule. ried othfr imfora'atiois diiteed otereitir) TITY COST PER

lUst covinuotion shoisr(,) ofii...ssoyI) (Payee must NOT use the space below) TOTAL PAYMENT: APPROVED FOR EXCHANGE RATE DIFFERENCES [] COMPLETE = = $1.00 DIFFEREN _ES Q PARTIAL BY- R FINAL PROGRESS TITLE [] Amount verified; corne for [ ADVANCE Isigillivrier, is 1l,1) Pursuont to authority vested in me, I certify $hot this voucher is joirect and proper for payment

I /)..rJ (,Athorrard Crer/yrt Oficrr) (T.Ite ACCOUNTING CLASSIFICATION

CHECK NUMBER ON TREASURER OF THE UNITED STATES CHECK NUMBER ON (Ne,., .1 acek)

CASH DATE PAYEE' a.

When sated in trein currency. insert name of currency PER If the abilitv to cerriti and ac.thoin to approve are combinrd in one person. one signatre only is ncesun. other. wise the approvinS officer will sign in the space provided. over his official title 'When a voucher is receipted in the name of a company or corporation, the name of the person writinR the conpany or corporahte name. as well as the capacity in which he sqns. must appear. For example John Doe Company. per TTLE john Sm rh. S rytar'. or -Treasurer". as the case may be.

2f). UL W011Uaug , e'1iraliae O',IC I ? f-2-1s-fl114 AZI.EX C Attachment

OUTLINE FOR ACTIVITY IMPLEMENTATION AGREEMENT (Note: to be attached as Annex B of Grant Agreement)

Activity Name: Activity Number: Country: Original or Revision No: Date:

INTRODUCTION:

P-arsuant to Section 2.4 of the Grant Agreement between the Government of and A.I.D., the purpose of this Agreement is to set forth for activity number such descriptive, budgetary and administrative information as is considered sufficient to satisfy the condition of Section 2.2.

1. Description of the Activity:

A brief description of the total activity, its cost, purpose and relation to drought recovery and rehabilitation, and identifica­ tion of the specific portion of the activity to be financed under the Grant Agreement.

2. Implem nting Agency:

Identiilcation of the implementation agency and its representa­ tive(s); clear definition of responsibilities of all parties con­ cerned with carrying out the activity; names of the person or persons whose signatures will be accepted for required certifications in connect­ ion with disbursement requests, procurement, reporting, etc. (Note: The general thrinst with respect to activities involving voluntary agencies shiould be " to have as much implementing authority as possible delegated to the volags; e.g., to extent the Government, A.I.D. and the volag can agree, the Christian Relief Committee (CRC) should be designated as the agency to certify for disbursement, rather than having to secure such certification from a government representative each time disbursemert is requested.)

1. ANNEX C

3. Implementation Schedule:

General work plan for total activity and an implementation schedule for portion to be financed under Grant Agreement. To the extent possible and appropriate that schedule should project physical as well as financial progress of the activity.

4. Objectives/Targets:

Indications of the results expected to be achieved by completion of the activity (viz. 500 ton storage warehouses completed in I , and ; or pasture land re-seeded in an area of 35 square miles around water holes A, B, C, and D). The objectives and targets should be defined with sufficient specificity to permit evaluation of the effectiveness of the provision and utilizatior of the resources provided under the Grant Agreement as well as the achievement and relevance of the total activity.

5. Budget:

Line-item budget identifying each component or malor item of equipment to be financed by the Grant, together with estimated costs (foreign exchange and local currency). Note: This budget is extremely important since it will provide the disbursement agent with an identi­ fication of the components and major items eligible for financing, the total amount authorized for disbursement for this activity and the amount authorized for disbursement for each item.

6. Non-A.I.D. Inputs:

General description of other non-A.I.D. inputs essential to the execution of the activity.

7. Reporting Requirements:

Specification ol:progress and completion reports to be submitted to A.I.D. by tht government and/or the implementing agent.

8. End-Use Accountability:

Establishment of a date beyond which t'ie Government is no longer accountable to P.I.D. for the goods and services provided in conn,'ction

2. ANNEX C with this activity. This may be the completion of the activity or such other time as may be considered appropriate (e.g., receipt end acceptance by A.I.D. of a final report, if one is required).

9. Modification oX the Activity:

-2 If necessary, to be accomplished by the issuance of additional implementation letters.

Signed on behalf of the Implementing Agency Signed on behalf of A.I.D.

BY: BY:

SIGNATURE: SIGNATURE:

TITLE: TITLE: Mission Director

Countersigned oa behalf of the Relief and

Rehabilitation Commission

BY:

SIGNATURE:

TITLE:

3.