Document of The World Bank
FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 4662-YAR Public Disclosure Authorized
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDSAGRICULTURAL DEVELOPMENT PROJECT
STAFF APPRAISAL REPORT Public Disclosure Authorized
February 16, 1984 Public Disclosure Authorized
This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS
US$1.00 = Yemeni Rials (YRls) 4.50 YRl 1.00 = US$0.22 YRls 1 million = US$222,222
WEIGHTS AND MEASUR~ES
1 millimeter (mm) = 0.039 inches 1 meter (m) = 3.28 feet 1 square meter (m 2 ) 10.76 square feet 1 kilometer (km) = 0.62 miles 1 hectare (ha) = 2.47 acres 1 metric ton (ton) = 2,205 pounds 1 litre (1) ' 0.264 gallons
ABBREVIATIONS
ARS = Agricultural Research Service CACB = Cooperative and Agricultural Credit Bank CPO = Central Planning Organization CYDA = Copfederation of Yemeni Development Associations DAFRD = Dhamar Agricultural and Forestry Research and Development Project FAO/CP = Food and Agriculture Organization/World Bank Cooperative Program GCC Governorate Coordinating Council IDA = International Development Association IFAD = International Fund for Agricultural Development LDA = Local Development Association MAF = Ministry of Agriculture and Fisheries MIS = Ministry of Trade and Supply ODA = Overseas Development Administration of the United Kingdom PPF = Project Preparation Facility SURDP Southern Uplands Rural Development Project USAID = United States Agency for Internat,ionalDevelopment YAR = Yemen Arab Republic YOMINCO = Yemen Oil and Mineral Corporation
GOVERNMENT OF YEMEN ARAB REPUBLIC
FISCAL YEAR
January 1 - December 31 FOR OFFICIAL USE ONLY STAFF APPRAISAL REPORT
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAI, DEVELOPMENT PROJECT
Table of Contents
Chapter Page No.
CREDIT AND PROJECT SUMMARY ...... i - iii
I. BACKGROUND ...... 1
A. Sectoral Setting ...... 1 General ...... 1 Development Potential ...... 2 Agricultural Institutions ...... 3 B. Agricultural Credit ...... 5 General ...... 5 Operating Policies ...... 5 Loan Procedures ...... 5 C. Government's Development Strategy ...... 6 D. IDA's Sectoral Strategy ...... 7
II. THE PROJECT AREA AND ITS DEVELOPMENT POTENTIAL ...... 8
A. Description ...... 8 Location ...... 8 Topography and Elevation ...... 8 Geology and Soils ...... 9 Climate ...... 9 Water Resources ...... 9 Rural Roads .10 Population and Labor Force .11 Land Tenure and Farm Size .11 Cropping Systems .11 Farm Technology .12 Agricultural Institutions .12 On-going Projects .12 B. Development Potential and Technology .13
The project was identified by FAO/CP in August 1982 and prepared by them in October/November of that year. It was appraised in April/May 1983 by a team consisting of Messrs. T. Haile-Mariam (Team Leader), S. Rana, M. Woldu, L. Revuelta, (IDA); and D. Masterton (Consultant). Messrs. J. Renkewitz and M. Zelaya (EMPWS) evaluated the Water Supply component. IFAD participated in the review of the preparation report, and was represented by Mr. T. Flhaut in final discussions with the Government during appraisal.
This document has a restricteddistribution and may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Chapter Page No.
III. THE PROJECT .14 A. Design Features ...... 14 B. Objectives ...... 14 C. Description ...... 14 Extension Development ...... 15 Rural Water Supply Schemes ...... 16 Studies ...... 16 Project Administration ...... 16 D. Implementation Schedule ...... 17 E. Cost Estimate ...... 17 F. Financing ...... 19 G. Procurement ...... 20 H. Disbursement ...... 21 I. Environmental Impact ...... 22
IV. PROJECT IMPLEMENTATION ...... 22
A. Implementing Agencies ...... 22 General ...... 22 Extension Service ...... 23 B. The Borrower ...... 24 C. Terms and Conditions of Financing Water Supply Schemes .. 24 D. Progress Reporting, Monitoring and Evaluation ...... 25 E. Accounts and Audits ...... 25
V. BENEFITS AND JUSTIFICATION ...... 26
A. Impact on Production ...... 26 General ...... 26 Extension Program and Adoption Rates .26 Cropping Pattern and Production ...... 28 B. Marketing, Markets and Prices ...... 29 Marketing ...... 29 Markets ...... 29 Prices ...... 29 C. Impact on Beneficiaries' Income ...... 30 Beneficiaries ...... 30 Benefits ...... 31 D. Economic Rate of Return ...... 33 E. Risks ...... 34
VI. AGREEMENTS REACHED AND RECOMMENDATION ...... 35 ANNEX 1. Supporting Tables Page No.
1. Population and Villages in the Project Districts ...... 37 2. List of Vehicle Requirements ...... I ...... I .... 38 3. Source of Extension Service Staff ...... 9 4. Project Cost Estimate ...... 4' 5. Estimated Schedule of Disbursemencs of EDA Credit. 6. Project Staff ...... 4. 7. Design Criteria for Rural Water Suipply Schemec ...... 43 8. Cumulative Number of Farmers Participating in Project .... 44 9. Crop Output from Areas to be Developed Uder Project .. 45 10. Prices of Key Commodities Used for Project Analysis .. 46 11. Present Cropping Pattern on Total Holding Represented by Farm Models ...... 47 12. Future Cropping Pattern on Area to be Developed Under Project ...... 48 13-18. Annual Incomes and Operating Expenses for Farm Models .... 49-54 19. Field Crop Inputs, Farm Traction, and Labor Requirements Per Hectare at Present ...... 55 20. Field Crop Inputs, Farm Traction, and Labor Requirements per Hectare with Project ...... 56 21. Crop Production Cost at Present ...... 57 22. Crop Production Cost with Project ...... 58 23. Operation and Maintenance Cost of Citrus with Project .... 59 24. Operation and Maintenance Cost of Vineyard with Project ...... 60 25. Operation and Maintenance Cost of Coffee with Project ...... 61 26. Economic Cost and Quantifiable Benefit Streams ...... 62
ANNEX 2. Selected Documents and Data Available in the Project File .. 63
CHART
World Bank 25171 - Organigram of Implementing Agencies
MAPS
IBRD 17321 - Project Districts IBRD 17322 - Average Annual Precipitation and Elevations IBRD 17323 - Project Area Il STAFF APPRAISAL REPORT
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
CREDIT AND PROJECT SUMMARY
Borrower: Government of Yemen Arab Republic.
Amount: US$ 8 million equivalent.
Terms: Standard.
Beneficiaries: The Ministry of Agriculture and Fisheries.
Project Objectives and Description: The proposed project is the first phase of an agricultural development program in the Central Highlands region of YAR. The key objective of the project is to increase farm income through production and productivity increases. The project would consist of: establishment of an extension service including construction of buildings, recruitment and training of extension staff, and provision of equipment; construction of 15 rural water supply schemes; studies of a possible second phase project; setting up of an organization for the project's implementation; and technical assistance. The project would benefit about 45,000 people. Yields of crops are projected to increase by 40-60% resulting in net farm benefit increases of over 70%. The project would also help to improve the quality of life of the rural population by providing them with potable water. The main risk is possible slow start-up of the project resulting from delay in establishing the project organization. Timely employment of local and internationally recruited staff, and early initiation of the recruitment and training of extension staff would minimize the risk. The Government realizes this important step in the project implementation, and intends to establish the project organization on a priority basis. Project Cost:/" Local Foreign Total ------…(US Million)------
Extension Development 3.4 3.3 6.7 Rural Water Supply 1.1 3.6 4.7 Studies 0.4 0.8 1.2 Project Administration 1.6 0.8 2.4 Base Cost 6.5 8.5 15.0 Contingencies Physical 0.3 0.6 0.9 Expected Price Increase 2.3 1.8 4.1 Sub-Total 2.6 2.4 5.0 Total Cost 9.1 10.9 20.0 Financing Plan;
Item IDA IFAD ODA Government LDAs Total ------(US$ Million)…------
Extension Development 3.1 1.5 1.0 3.3 - 8.9 Water Supply 3.3 1.7 - - 1.5 6.5 Studies 0.9 0.5 - - 1.4 Proj. Admin. 0.7 0.3 _ 2.2 - 3.2
Total 8.0 4.0 1.0 5.5 1.5 20.0
/1 The cost estimates exclude taxes and duties, as the project would be exempted from these. - 111 -
Estimated Disbursement;
IDA Fiscal Year
1985 1986 1987 1988 1989 1990
…____-…_------…(US$Million)------
Annual 1.8 1.9 1.2 1.0 1.1 1.0 Cumulative 1.8 3.7 4.9 5.9 7.0 8.0
Economic Rate of Return: 27 percent.
Appraisal Report: No. 4662-YAR dated February 16, 1984.
YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJFCT STAFF APPRAISAL REPORT
I. BACKGROUND
A. Sectoral Setting
1.01 General. Until the late 1960's, the agricultural sector was oriented largely towards the subsistence needs of basically a stagnant economy. The sector generated hardly any surplus on which economic growth could be based. Agricultural institutions, which were in their early phase of development, were weak. It employed about 90 percent of the economically active population and contributed as much as 90 percent of GDP. Currently, it accounts for about 30 percent of the GDP, 50 percent of merchandise exports, and employs 75 percent of the labor force. About f.5 million people (90 percent) live in rural areas.
1.02 In the wake of the 1973 oil price shock, the sector was subjected to a sudden change in the economic environment. Higher wages in neighboring oil-exporting countries lured many Yemeni workers to emigrate. Their remittances raised domestic disposable income. This resulted in an upsurge in the local demand for foodstuffs, including fruits, vegetables, and other products, some of which were new to the Yemeni diet. The farmers' responses to these changes were predictable. Marginal rainfed lands used for cultivating traditional grains were abandoned and more effort was directed to cultivating more rewarding and often new types of cash crops. Still the growth in demand for foodstuffs far exceeded domestic supply. As a result, agricultural imports increased sevenfold during the past decade. In particular, imports of cereals increased from about 160,000 tons in 1974 to about 510,000 tons in 1981. Currently, imported foodstuffs account for about 30 percent of merchandise imports. Meanwhile, exports of agricultural products, which have always been modest, have declined by about half. During 1973-80, imports of agricultural products increased from US$80 million to US$540 million. During the same period, agricultural exports declined from about US$15 million to about half that much.
1.03 Now that the inflow of workers' remittances has stablilzed (close to US$ 1.0 billion per year), and given the economy's limited potential for industrial development and the uncertainty surrounding mineral exploration, agricultural growth must be relied upon to sustain the improvement in the standard of living of the population. The potential for agricultural development is significant. Although traditional farm practices predominate, there has been a steady increase in the use of fertilizers and pesticides over the past decade. Originally applied to cotton (a traditional export crop), farmers are now responding to extension service advice in the context of specific development projects, principally in the Tihama area and Southern Uplands. Farmers have also demonstrated a strong interest in planting improved varieties of crops where these have been available, as in the case of wheat, potatoes, maize, and millet. Much more needs to be done. -2-
1.04 Development Potential. Agriculture has significant potential for development. About 1.5 million ha (out of a total area of 20 million ha) have the best potential for rainfed agricultural development on about 1.2 million ha and irrigated agricultural development on 0.3 million ha 1/. They are spread in five main agroecological zones as follows:
(a) the Coastal Lowlands (Tihama) cover a band 400 km long and 30 to 60 km wide along the Red Sea coast with elevations ranging between sea level and 200 m above. Tropical conditions of high temperature and humidity prevail. The Tihama comprises 5 major wadis and 12 smaller ones which permit cultivation of about 235,000 ha. Rainfall is scarce (50 to 200 mm), and agriculture depends mainly on utilization of the flood discharge of the wadis and of underground water resources. The main crops are sorghum, millet and cotton. Tobacco, maize, sesame, vegetables and fruit (dates, bananas and citrus) are also grown. Live- stock plays a minor role in this region, which contains an estimated 10% of the country's population of cattle, sheep and goats;
(b) the Southern Uplands lie east of the Tihama with elevations ranging from 200 to 1,500 m above sea level. The landscape is rugged, cut by deep wadis. In the foothills, with higher relative humidity, sorghum, maize, bananas, papaya, citrus and vegetables (tomatoes, onions, okra and radishes) predominate. In the middle heights, temperature and humidity conditions are subtropical. Sorghum, Sat (a plant with mild narcotic effect), coffee, fruit and vegetables are the major crops. The total cultivable area in the Southern Uplands is about 550,000 ha, mostly on man-made terraces. The region is also an important livestock producer containing approximately 30% of the total cattle population of the country and a similar percentage of sheep and goats;
(c) the Central Highlands (Chapter II) comprise the middle reaches of the central mountain range. W~heat,barley, alfalfa, sorghum, grapes, qat, coffee, figs, stone fruit, and vegetables are the chief crops. The total cultivable area in this zone is about 600,000 ha. The Central Highlands are also the main livestock- raising region with about 35% of the total of cattle, sheep and goats;
1/ About 15 million ha are mountainous, desert, and semi-arid to arid range lands with sparse vegetation. These are not considered to have good potential. About 3.5 million ha are either sparsely wooded or are cultivated intermittently for field crop production in years of high rainfall. They have a limited potential, but these may not be priority development lands because of low and uncertain rainfall. -3-
(d) the Northern Highlands constitute the upper reaches c" the central mountain chain. The climate is semi-arid with arnnal rainfall ranging from 200 to 500 mm and altitudes that exceed 1,500 m. There are an estimated 130,000 ha (,- cultivable land in this region which is mainly devoted to sorghum, wheat and grazing. The livestock population in this region is estimatec at about 15% of the country's total; and
(e) the Eastern region slopes gently towards the desert in the Fast. There is very little rainfall, and desert shrubs are the main vegetation. Most cultivation, on an estimated 25,000 ha, occurs along the wadis that flow eastwards from the Highlands towards the desert. Sorghum and millet are the principal crops. Live- stock plays only a minor role in this region, with about 10% of the total stock of the country.
1.05 Rainfed agriculture would continue to be the primary source of sectoral production in the foreseeable future. Production under rainfed cultivation can be increased by changing cultural practices such as improving the timing and quality of seed-bed preparation, applying fertilizers and pesticide, and practicing soil moisture conservation such as weed control. These improvements would need to be supported by an effective information campaign to educate the farmers, complemented by supply of technological packages. Yemeni farmers are responsive to financial incentives, and it should not be unduly difficult to transfer to them new agricultural technolo- gical packages provided the technologies are readily available, and are proven to increase production profitably. Such a transfer is intended to take place under the proposed project.
1.06 Livestock and poultry are also important, accounting for about 20% of the agricultural output, and are an integral part of rainfed and irrigated agricultural activities. The animals are kept for transportation and as draft animals, as a source of animal products for home consumption, and secondarily as source of cash income. They are fed on crop byproducts and on poor communal pastures. They suffer from a wide variety of diseases, are under- nourished and underweight; hence their productivity is low. This has resulted in stunted and slow maturing animals, and in low animal production coefficients. Potential areas of improvement include better veterinary services, improved feeding practices, and improvement in herd and range management. The project would demonstrate the benefits of improved feeding and would increase the supply of crop byproducts for animal feed. Attempts are being made under a separate project to improve livestock health.
1.07 Agricultural Institutions. Overall responsibility for agricultural development lies with the Ministry of Agriculture and Fisheries (MAF) at Sanaa with six departments, among them the Agricultural Services Department which is itself divided into six divisions including extension and plant protection. MAF has established agricultural offices in the capital cities of nine gover- norates, but due to financial and staff constraints, its extension activities are very limited. Of the total of about 210 agents, about 190 are in the Tihama area and the Southern Uplands leaving only about 20 agents to cover the rest of the country. The proposed project would include a component for strengthening the extension service in the project area. -4-
1.08 The MAF is also responsible for agricultural research. Prior to 1973, agricultural research was non-existent. In 1973, UNDP initiated support of a Central Agricultural Research and Training Organization in Taiz. The project, executed by FAO, established the Agricultural Research Service (APS) at Taiz and started research on key crops in the Southern Uplands region. In 1973, IDA's first assistance to agriculture in YAR (Tihama I) included a research component in the Tropical Lowlands. Subsequently, several bilateral assistance projects have incorporated research components. In 1979, UNDP initiated Phase II of its Agricultural Research Project with IDA as executing agency. ARS's objectives under Phase II were to: conduct a research program geared to the agricultural problems of the Southern Uplands; advise MAF on developing a national research program; provide facilities, equipment, and expatriate assistance for a study of the country's research programs; and provide for training of the necessary extension agents required under Southern Uplands Rural Development Projects I and II. An Agricultural Research and Development Project has recently been approved by IDA and is being co-financed by IFAD and the Government of Italy. The various ongoing research projects have yielded results which will be applied in the project.
1.09 IDA, in collaboration with other donors, is helping to train agricultural staff at secondary schools in Ibb, Surdud, and Sanaa. The Ibb school, which opened in 1979, has a capacity for about 150 students. The Surdud school, with a capacity for 220 students, opened in 1981, and the Sanaa school, opened in 1982, has a capacity to train 180 students. In addition, ARS at Taiz has been providing, since 1979, one year theoretical and practical training courses for about 25 extension students. Two-week refresher sessions are held regularly, mainly for extension agents working under the Southern Uplands project. Training (domestic and external) is also being provided under several other projects financed by IDA and other donors.
1.10 The farmers are also active in self-help rural development programs through their Local Development Associations (LDAs). The LDAs started in 1963, following a decree from the Government calling for the establishment of local groups to build the basic infrastructure in their respective areas, encouraging self-help rather than relying solely upon central government initiatives and programs. Mostly, government contacts with LDAs are channeled through the Confederation of Yemeni Development Associations (CYDA) which is a coordinating body through which the Government exerts its influence. There are currently about 200 LDAs throughout the country. Thus far, the bulk of LDAs' resources has been spent on roads, water supply projects, schools and clinics.
1.11 The LDAs are organized by districts and relate to the Government and its technical ministries through their Governorate Coordinating Councils (GCSs) and CYDA. Each LDA and GCC has a general assembly and an elected board. Eligible voters in the LDA territory elect members to the general assembly while the general assembly of GCC consists of presidents of all LDAs within the various governorates. The membership of CYDA's board comprises 11 GCC general secretaries, 11 individuals elected by LDAs' presidents and 9 non- voting deputy ministers appointed by the Government. The President of YAR is also President of CYDA. -5-
B. Agricultural Credit
1.12 General. The primary source of institutional finance for agriculture is the Cooperative and Agricultural Credit Bank (CACB) established in 1982 by consolidating the Agricultural Credit Bank and the Agricultural Credit Fund. IDA has provided a credit of US$8 million in 1982 (Credit 1308-YAR) to strengthen CACB. Details on CACB's management and organization, staffing, accounting and performance are contained in the Staff Appraisal Report on that project (Report No. 4102-YAR). This section summarizes this bank's operating policies and procedures.
1.13 Operating Policies. CACB was established to provide short-, medium- and long-term financing for the development of agriculture, forestry, fisheries and related activities, and to promote and support agricultural and handicraft cooperative associations and organizations. Eligible borrowers include individuals, cooperatives, LDAs, and corporations. Since the institution is fairly young, its coverage of the rural areas is limited but growing.
1.14 At present, CACB charges interest at the rate of 9% on seasonal loans and 10% on medium-term loans. These rates have been positive in real terms over the past few years, but with a projected increase in the rate of domestic inflation, the real rates are nearing zero or becoming negative. Under the Agricultural Credit Project, CACB would continue, for the time being, to charge these rates and to carry out a periodic review of them at intervals not exceeding two years with the first such review to take place not later than June 30, 1984.
1.15 Other terms and conditions of lending include: the loan amount should not exceed 75% of the total cost of subprojects; no loans should be made for the production of qat, in cases where the required loan security is already encumbered, or to defaulters of previous loans; irrigation loans should be made only on the basis of a certificate from a qualified technician showing adequate water availability for irrigation; and loans for land development, well drilling, plantations and other activities that are completed over a period of time should be disbursed in installments following field visits by CACB personnel. CACB obtains as security a promissory note for the full amount of the loan, two personal guarantees for all loans up to YRls 20,000 (US$4,445), and a land security for any loans in excess of that amount. The security requirements may be unnecessarily restrictive for some needy but progressive farmers with limited assets. Under the above mentioned credit project, the CACB has undertaken to adopt the following two modifications to the above lending conditions: for tenant farmers, the crop would be acceptable as security for seasonal loans not exceeding Ypls 20,000 (US$4,445) without the need for guarantors; and a financial rate of return of not less than 12% is the minimum criteria for subproject acceptability.
1.16 Loan Procedures. The evaluation of applications is entrusted to credit supervisors at the branches. Decisions regarding loan approvals have been based upon the availability of adequate security. Appraisals are often inadequate primarily due to the lack of adequate training of the project staff. To improve project evaluation and the necessary technical skills of -6- the CACB staff, the Agricultural Credit Project provides for six internationally recruited experts who would assist in the training of staff and in the preparation of manuals for their guidance.
1.17 Branch managers are responsible for loan collection and, at present, an effort is made at harvest time to contact the borrowers to ensure collec- tion when the crop is sold. If payment is not: made after sale of the crop, peer pressure is brought to bear and the loan guarantors are informed of the delinquency. To date no loans have been written off nor is there a procedure for doing so. Nevertheless, the loan recovery rate which exceeded 90% at the beginning of operations has tended to deteriorate recently. The IDA financed project is designed to improve loan supervision and recovery.
C. Government's Development Strategy
1.18 The economy of YAR is basically free of government intervention in the workings of the market system. Most economic activities are undertaken by private entrepreneurs, and public investments are complementary to investments by the private sector. The Government has undertaken several investments in irrigation and rural infrastructure to complement the efforts of the private sector. Under the First Five-Year Plan (1976-81), emphasis was given to irrigation development in the Tihama plain. The development strategy also included integrated regional rural development in the Southern Uplands. In all cases, project design included important institution building components for project implementation and planning. The distribution of public investment in agriculture was irrigation (50%), livestock development (18%), crop research and training (14%), rural development (11%), fisheries (6%), and forestry (1%). The overall goal of the plan was to reduce dependency on imported food within a general framework of a 5.5% rate of annual increase of agricultural production. High priority was assigned to projects in areas with good agricultural potential, and to research and manpower training.
1.19 An assessment of achievements under the first plan has been carried out in conjunction with the preparation of the Second Five-Year Plan (1982-85). A number of major development projects were completed, a large cadre was trained, an Agricultural Credit Bank was established and a vast lending program implemented far beyond what was anticipated in the plan, new extension services were created, a central research station became a reality, and development centers were established in Radaa, Dhamar and Amran.
1.20 The Second Five-Year Plan was presented in April 1982 to an inter- national congress of donor countries and multilateral development agencies. The overall strategy and approach of the First Five-Year Plan have been maintained in the Second. In addition, the Second Plan includes a broader geographical dispersion of projects aimed at cementing national unity as well as increasing overall agricultural production. The agricultural investment program, however, is ambitious: it proposes implementation of 57 public investment projects at a cost of about US$670 million equivalent. However, with the emerging severe budgetary constraint and the long standing skilled manpower shortage, the Government is unlikely to implement in full such an ambitious development program. The Government has confirmed during negotiations that the proposed project will remain a priority development program and will be fully funded until it is completed. -7-
D. IDA's Sectoral Strategy
1.21 In support of the Government's development objectives, IDA's strategy for agricultural sector assistance is three-pronged: (i) support to projects in zones of high production potential in the Coastal Lowlands (Tihama) and Southern Uplands; (ii) assistance in the development of improved technological inputs and in the provision of financial means for the farmers to purchase and apply those inputs; and (iii) institution building aimed at strengthening major agricultural support services. To date, IDA has financed 11 agricultural projects.
1.22 The first IDA-assisted agricultural project was Tihama Development I (Wadi Zabid) in 1973, co-financed with the Kuwait Fund. It was completed in December 1979, only six months behind schedule with an IDA credit of US$21.2 million and Kuwait Fund loan of US$16 million. The Project Performance Report states that introduction of new technology through agricultural research and extension for irrigated crops in the Wadi Zabid region of the Tropical Lowlands was readily accepted by farmers despite a well entrenched traditional socio-political environment. Part of the success of the extension service was attributed to the results of agricultural research conducted in the project area.
1.23 The second project (1976) was SURDP I assisted with an IDA credit of US$10 million and co-financed with USSlo million from the Abu Dhabi Fund. That was the first integrated rural development project, which was designed to increase agricultural production from about 50,000 ha cultivated by nearly 21,000 farmers. The project, which was recently completed (completion report of December 1982), was successful in achieving its broad objectives of increasing rainfed cereal production and improving rural infrastructure, particularly water supply. Specifically, the project succeeded in: providing short-and medium-term credit to a large number of farmers; constructing 66 village water supply and several small-scale irrigation schemes; establishing agricultural extension, plant protection, and veterinary services; and setting up an effective rural development unit. Start-up was slow because it took time to make the new project unit operational mainly due to staff recruitment problems. The project unit has developed into a reasonably effective organization capable of sustaining the development momentum. Despite the slow start-up, the farmers' participation in the project was enthusiastic adopting rapidly improved technological packages, and yield gains for major crops reached or exceeded appraisal expectations.
1.24 SURDP I was followed up by SURDP II in 1981, co-financed with IFAD. SURDP II is progressing well. The project has developed a range of technical packages which offer development opportunities. These packages, which vary by rainfall zones, irrigated areas, and crops include fertilizer, plant protection, seed treatment, improved varieties, spacing, mechanization, pest control, and cultivation practices. The project has been successful in selecting, training, and deploying extension staff; and developing extension packages and having these adopted by a large section of the farming community. Very good crop yields have been obtained from the application of improved technical packages. -8-
1.25 In general, IDA's role as a catalyst for co-financing of primarily agriculture and rural development projects has been substantial. Other IDA-assisted agricultural projects under way include Tihama Development II (Wadi Rima I, FY78), III (Wadi Mawr, FY80, co-financed with IFAD) and IV (Wadi Rima II, FY80); and Livestock Credit and Processing (FY77), all of which are making progress usually after having experienced start-up difficulties due to financial,managerial, and staffing problems of varying degrees of severity. A Grain Storage and Processing Project I (FY76) has been completed recently. The Fisheries Development Project (FY80) has major problems of management, and is making little progress. An Agricultural Research and Development Project was approved by IDA on June 8, 1982, and the credit became effective on November 30, 1983. A credit of US$8.0 million for an Agricultural Credit Project was approved by IDA on December 14, 1982. Although the projects completed or nearing completion have increased production, the impact of all projects on agricultural development at the national level is too early to judge.
1.26 IDA's involvement in the sector is designed to strengthen the capability of MAF to support agricultural development, and raise the standard of living of the rural population. This is the twelfth agricultural project over a ten-year period. The achievements of the two completed projects financed by IDA are evidence of the importance of the Association's continued involvement in the sector. The proposed project is modeled after the successful Southern Uplands projects and falls within IDA's strategy of replicating the successful experiences in the various parts of the country. The Government in general, and MAF in particular, continue to rely heavily on IDA's assistance and have considerable regard for the policy and technical advice they receive. As more of the IDA-assisted agricultural projects reach their productive phases, it would be possible to generate a momentum of agricultural growth that would have a tangible effect on the sector at large. It is important to have a critical mass of agricultural projects, appropriately located, that can sustain the momentum, such as the proposed project which would be located in the important Central Highlands part of the country.
II. THF PROJECT AREA AND ITS DEVELOPMENT POTENTIAL
A. Description
2.01 Location. The project area (Map IBRD 17321) would be located in parts of the Governorates of Dhamar and Sanaa i:n a region collectively known as the Central Highlands. It would cover five clistricts of Dhamar Governorate (Dhamar, Al Hada, Mabar, Dawran and Jabal Ash Sharq) and five of Sanaa Governorate (Bilad Arrus, Sanhan, Bani Matar, Al Haymat al Kharijiyah and Al Haymat al Dakhiliyah). The best potential for agricultural development in these districts is located in terraced rainfed areas receiving more than 450 mm of annual rainfall and in areas with irrigation.
2.02 Topography and Elevation. Physical characteristics of the project area fall into three broad classifications; the intermontane areas which lie generally above 2,000 m in elevation; the intermediate region or escarpments, ranging in elevation from 1,300 to 2,000 m and constituting the upper catch- -9- ments of the river systems draining to the west; and the wadis or the floors of the intermediate zone valleys which decrease from 1,300 to 1,000 m in elevation towards the west.
2.03 Geology and Soils. Geology of the area is predominantly tertiary volcanic, overlain in part by alluvium and intruded quaternary volcanic rocks. Faulting has tended to sharpen the relief but has also led to erosion of upfaulted areas and the deposition of alluvium in downfaulted areas. About 50% of the intermontane plains consist of stony deposits with very little soil cover, and is unsuitable for cultivation. The remaining 50%, representing the agricultural area, consist of basins, and major and minor valleys with deep soils. These soils are of moderately fine texture including sandy loam, loam or silt loam and are in general well drained. Most of the productive soils in the upper catchments have been deposited on a centuries old system of terraces. The terraces have served to control erosion, to harvest water runoff, and to retain the deep soils. Soils on the wadi floors are mostly silt to silty loams of varying depths overlying gravel. All are free textured, usually well drained and easy to cultivate. Organic matter, nitrogen, and phosphorus levels are generally low, but the content of exchangeable potassium and magnesium are high. With adequate moisture, the soils would give satisfactory response to application of nitrogenous and phosphatic fertilizer and allow a wide range of crops to be grown.
2.04 Climate. Climatic conditions vary from temperate on the high intermontane plains and terraces to subtropical in the wadi floors. Rainfall on the intermontane plain ranges generally from 250 to 400 mm but increases to the west in the intermediate region reaching 600 to 700 mm. Further to the west, rainfall decreases with proximity to the coastal Tihama plain (Map IBRD 17322). More than 85% of the rainfall occurs during the spring and summer growing seasons.
2.05 Mean annual temperature is about 150 C but there is considerable variation. Day temperatures remain well above 150 C throughout the year but night temperatures can drop below zero at high elevations, especially from December through February. Conditions in these areas are suitable for temperate fruits but the chance of frost limits the planting of potatoes, tomatoes and other sensitive crops. Terraced lands in the intermediate zone are generally free of frost.
2.06 Climatic conditions on the plains at high elevation permit the growing of one main crop planted between March and June and, in some cases where water is available, a catch crop either before or after the main crop. They are suitable to grow deciduous fruit and grapes. Conditions at highest levels on the terraced lands of the intermediate region are similar to the plains except for a reduced danger of frost; at lower elevations, with water, second cropping is possible and perennial crops such as coffee and citrus can be grown. The wadi floors have subtropical conditions suitable for multiple cropping and for growing coffee, citrus, banana, papaya, etc.
2.07 Water Resources. Rainfall on the catchment is the only known source of water within the project area. A part of the runoff generated therefrom flows through numerous small streams used partly for spate irrigation and the rest percolates into the soil which either charges the aquifer or emerges -10- through springs and wadi bed resurgences and contributes to the perennial streams. Unfortunately, no figures are available for the runoff and very little is known of the frequency and volumes of floods produced by the occasional heavy rainstorms. Some of the perennial discharge and most of the floods flow out of the project area to the Tihama plains where these are used for irrigation and domestic water. The existing use of the available water resources in the project is irrigation in 10 districts on about 8,730 ha including 4,615 ha from springs or perennial flow, 4,115 ha from groundwater in addition to about 6,000 ha occasional and irregular spate irrigation. Domestic water is also derived from the same sources as the irrigation water, but it is raw and has to be hauled over long distances.
2.08 The two main locations of groundwater are the aquifers of the Sanaa basin and the Dhamar Mountain Plains. The Sanaa aquifer is constituted by cretaceous sandstones, is productive and has a water table at depths varying from 20 to 30 m below ground surfaces in low-lying areas to over 100 m in the highlands. In the Dhamar Plains, shallow alluvial aquifers provide most of the groundwater abstraction and deep volcanic rocks account for the rest. The origin of the shallow aquifer in the alluvium is percolation from the surface runoff but that of the deep groundwater is not known. The yield from the shallow aquifer depends upon the amount of rainfall in the preceding periods and is thus highly variable. The groundwater resources in the project area have so far sustained the exploitation despite a tremendous growth in demand lately, albeit, by depletion of the deep aquifer at an annual rate of between 0.5 m and 2 m. Since the pumping rates have not stabilized yet and the hydro-geology has not been fully investigated, it is hard to judge at this stage whether the state of equilibrium in the Groundwater Equation has already been surpassed. Therefore, before expanding the existing use of groundwater substantially for agriculture, it is imperative that its potential be fully investigated. Such investigations are planned by various agencies, namely, Yemen Oil and Mineral Corporation (YOMINCO) at the country level, through special hydrological and water resources studies (paras. 3.09 and 3.10) in this project, and as part of the ongoing irrigation projects in the Tihama region. During negotiations, assurances were obtained that the Government would not authorize digging of new wells for agriculture in the project area until the said studies have proven availability of groundwater for additional exploitation (para. 6.01 (a)). Should it be found that the existing water resources would not sustain the increasing demand for agriculture, irrigation would have to be restricted by giving preference to domestic water needs of the population in the project area.
2.09 Rural Roads. Principal access to the project area is provided by the Sanaa-Hodeidah road for the project districts of Sanaa Governorate, and by the Sanaa-Taiz road for the districts in Dhamar Governorate. These are the two most important trunk roads of YAR with asphalt pavements which are in good condition, and with average daily traffic of more than 3,000 vehicles. The roads constitute the backbone of some 2,000 km of rural roads in the project area.
2.10 The rural road network consists mainly of track and low-standard earth roads. These have not been built to formalized standards, and most of them lack drainage and retaining walls. Many are barely of bulldozer width and are negotiable only by four-wheel drive vehicles. During the rainy season, the roads become muddy and get floodecd. The Arab Fund for Economic and Social Development is helping to improve rural roads in the project area. -ll-
Traffic on the roads is local, the roads being used for transport of passengers and agricultural products.
2.11 Population and Labor Force. The rural population of the 10 project districts is estimated at 366,840 inhabitants, with the agricultural population comprising about 85%. The rural population lives in some 1,645 villages and 1,120 associated hamlets, giving an average of 33 families per village (Annex 1, Table 1). Of the agricultural population, the available adult labor force amounts to 160,000. With around 150 days for work during the crop season, the average family has some 430 work days available. Including an estimated 60 days equivalent for livestock care during this period, representative farms require 200 to 380 work days leaving a considerable surplus of labor. Even during the peak demand seasons of planting and harvesting, family labor remains underutilized.
2.12 Land Tenure and Farm Size. About 80% of the entire agricultural land is occupied by owners and the remainder by sharecroppers; the area to be developed under the project is expected to be owner operated. Average farm size varies from about 0.5 to 6.7 ha; about 30% of the farms range from 3 to 7 ha. Holdings are fragmented into many parcels ranging on average from 4 to 12, but since holdings are divided into 10 or more terraces, fragmentation at different elevations helps to spread the seasonality of production.
2.13 Cropping Systems. These can be categorized as follow;
(a) Rainfed farming on the plains. This group includes about 24% of all farms. Because of the generally low rainfall (less than 450 mm), the area includes farms where there are no proven develop- ment packages. Improved varieties and techniques tested to date in such areas have failed to consistently demonstrate yield improvement that would be attractive to farmers. These areas would not be included in the project;
(b) Rainfed farming on the terraces. This category includes about 45% of all farms, roughly one third of whom are in low-rainfall areas with no immediate development prospects. Yield levels are higher than in the plains, and there is considerable scope for the improvement of crop production through better agricultural practices. About 60% of the area to be developed under the project would be located here;
(c) Mixed rainfed-irrigated farming on the plains. These farms account for only about 8% of the total. Irrigated production is predominantly cereals, usually wheat and maize but also including sorghum, alfalfa, and vegetables/potatoes. About 10% of the area to be developed under the project would be located here;
(d) Mixed rainfed-irrigated farming on the terraces. These account for about 18% of all farms. Rainfed production is supplemented by surface water or groundwater irrigation devoted mostly to a single cereal crop and vegetable production. Some irrigated -12-
terrace areas at lower elevation are devoted to coffee and fruit production. Farms in this category would account for about 28% of the area to be developed under the project; and
(e) Irrigated farms in the wadis. Purely irrigated farms account for only 5% of the total and many of these are located in the wadis where they have part or all of the area depending on spate flow and a small area of perennial surface or groundwater irrigation. Spate flow is used for sorghum or maize, usually more than one crop annually. Perennial irrigation is used for maize (usually two crops) and vegetables with small areas devoted to coffee and or fruit including citrus, bananas and papaya. Such farms would comprise about 2% of the area to be developed.
2.14 Qat is also an important part of the cropping system. It is widely consumed by the population who enjoy its stimulating and relaxing properties. It is believed to account for a significant proportion of household expenditures. High prices and low production cost make the crop very profitable, and this has induced farmers to use good land to grow it. Although output has been increasing rapidly, there are no official estimates of production, but it is generally assumed that its market value exceeds by far that of any other cash crop. This suggests that agricultural incomes, including those derived from qat, are substantially higher than shown in the national accounts.
2.15 Farm Technology. The farmers have highly developed traditional skills in soil conservation, water harvesting and land preparation; on the other hand, irrigation is relatively recent, and the techniques are not well developed. Even in the absence of an extension service, farmers in many villages have started to use small quantities of chemical fertilizers and there has been considerable expansion of dug wells for irrigation during the last decade. Apart from the above changes and the use of tractors for initial ploughing, production techniques remain basically traditional. Nevertheless, experience from other projects indicates that the farmers are highly profit motivated, responsive to demonstration, and adopt proven improved techniques of production.
2.16 Agricultural Institutions. MAF has governorate offices in Dhamar and Sanaa but, being recently established, the Ministry's presence in these governorates is small and largely ineffective. Only a few extension agents work in the areas serving an insignificant number of farmers. The project would remedy the situation by establishing an extension service, which would be the core of the Ministry's support service in the areas.
2.17 On-going Projects. The British Government-supported Dhamar Agricultural and Forestry Research and Development Project (DAFRD) has been operating in the Dhamar Governorate since 1981. The team includes experts in extension, agronomy, forestry, horticulture, livestock, farm machinery, and farm management. The project has carried out trials and demonstrations with cereals, alfalfa, potatoes, and vegetables though mostly under irrigated conditions. The team has also worked with the limited staff of MAF in providing extension services. In addition, there is a British-supported -13- veterinary service project as part of a national program to establish veterinary service; a Potato Seed Multiplication Project, supported by the Dutch Government, produces high-quality potato seeds for distribution to farmers, and USAID is active in fruit tree development focusing on production of seedlings and training of horticulturists. The IDA- and IFAD-assisted Agricultural Research and Development Project is being established in Dhamar. The project would collaborate with and benefit from the above on-going projects.
B. DevelopmentPotential and Technology
2.18 In rainfed terraced areas receiving more than 450 mm, there are proven technological packages which can be applied to increase production. For field crops, these include improved varieties, seed treatment, fertilizer application, inter-row cultivation, improved seed-bed preparation, weed control, spraying against pests, and land leveling. If these are done, average farm-level yield increases of 40% to 60% can be obtained. On demonstration plots, sorghum and wheat yields have considerably exceeded 1.3 tons/ha, while for maize the correspondingyield exceeds 1.8 tons/ha.
2.19 The above technologicalpackages can also be applied for field crop development under irrigation. On demonstrationplots where improvementshave been introduced,grain yields per hectare of 3.0 to 4.8 tons for sorghum, 3.5 tons for wheat and 3.3 to 4.5 tons for maize have been recorded. A number of vegetable crops (tomatoes, peppers, melons, carrots, cucumbers, onion, and garlic) are currently grown, each of which has potential for yield increase. For tomatoes (the most importantvegetable), with the use of improved variety, careful attention to planting date and plant population,proper fertilization, adequate control of early blight, and improved irrigation, yields of 25 to 30 tons per ha are achievable.
2.20 There is also considerable potential for increasing the yield of tree crops through improved cultural practices. For grapes, existing production techniques are traditional resulting in yields of 4 to 5 tons/ha. Yields can be expected to increase to at least 12 tons/ha with improvement in cultural practices. Existing coffee is also low producing. Experiences at SURDP with new planting, using proper spacing, pruning, regular watering, treatment against insects and chemical fertilizinghave produced yields of up to 2.4 tons/ha of dry beans. Interest in citrus and sub-tropical fruits is also increasing and there are now many new but small plantations. Plant spacing permits inter-croppingwith alfalfa or beans during the first three years. Yields of at least 18 tons/ha can be expected from mature trees.
2.21 Given the already demonstrated responsiveness of the farmers, the key constraint to reaching the foregoing crop potentials is inadequate awarenessby the farmers of these and the means of achieving them. Extension packages exist for a first generation of development in certain areas, but the service to deliver these is not in place and at present there are no suitably qualified extension staff. The project would improve this situation by building up an extension service for the area. -14-
III. THE PROJECT
A. Design Features
3.01 The project would be the first phase of an agricultural development program in the Central Highlands. It would develop a target area of about 16,430 ha cultivated by about 8,325 farmers!/. The key determinants of project size are the availability of trained extension agents and the rate of progressive adoption by farmers of the technologies to be recommended.
3.02 Agricultural development would be promoted in terraced areas receiving more than 450 mm rainfall or where farmers have irrigation. Terraces on which rainfed crops would be grown have an accumulation of topsoil and stored water runoff from higher slopelands. Development packages for rainfed terraces would be taken from areas withi similar rainfall in SURDP and from actual though limited demonstrations carried out in the area. Irrigated packages for field crops and vegetables depend on results from ARS and SURDP experience and from the UK-assisted research station in Dhamar. Coffee, subtropical fruit, and grape potentials are based on actual experience in the area and from demonstrations carried out by the USAID-financed horticultural project. Rainfed packages are simple, involving mainly seed treatment, fertilizer use, plant protection, and improved varieties.
B. Objectives
3.03 The key objective of the proposed project is to improve farm income through production and productivity increases. The project would also help to improve the quality of life of the rural population by providing them with potable water. To achieve the above objectives, the project would finance the components described below.
C. Description
3.04 The project, which would be implemented during 1984-88, would include the following components: building up of the extension service for the proposed project area; construction of rural water supply schemes; studies; and establishment of an organization for project implementation. In addition to this project, the Arab Fund for Economic and Social Development has already approved separately a loan of about US$10.5 million equivalent to finance the following investment in the project area: improvement of existing irrigation schemes, plantation establishment, improvement of rural roads, nursery development, and construction of a branch office for the Cooperative and Agricultural Credit Bank; this investment complements the project.
1/ The target area is projected to be reached by about 1992. The area which would be developed partially or fully during the project implementation period is projected to be about 3,260 ha. -15-
3.05 Extension Development. This would include construction of four block centers, and 20 houses for the staff of block centers; construction of 21 extension centers-cum-living quarters for agents-1 ; recruitment and training of extension agents; training of farmers; provision of cars and motorcycles (Annex 1, Table 2); and provision of foreign experts to provide backup support to the extension agents. There would be two block centers in each governorate which would be located at strategic points to serve several extension centers. The block centers are expected to be located at Al Jumah, Mabar, Matnah, and Bani Mansur. Locations of the extension centers would be determined during the course of project implementation, but the likely sites are shown in Map IBRD 17323.
3.06 About 34 man-years of internationally recruited consultants (two senior extension advisors; a specialist in plant protection; two experts each in livestock, farm machinery, home economics and extension agronomy; a horticulture specialist; and a fruit tree production technician) would be provided at a cost of about US$45,000/man-year. These would set up the extension service, develop extension programs and guide their implementation, train counterpart staff, and provide technical backstopping to local extension staff. ODA would finance the experts needed for the Dhamar Governorate while IDA and IFAD would finance the rest. Assurances were obtained that the senior extension advisor to be financed by IDA and IFAD would be recruited not later than January 1, 1985 and the other internationally recruited extension specialists financed by IDA and IFAD not later than July 1, 1985 (para 6.01(b)).
3.07 The extension service would be the core of MAF's field service in the project area. Because of the serious shortage of trained professionals in the country, and due to the preference to train extension agents from localities where they would eventually return to work, the project would select trainees from the project area to be trained, starting in early 1984, by SURDP staff in cooperation with staff of the Regional Agricultural Research Center at Taiz. As the training cycle runs for about 1-1/2 years, the initial field deployment of newly trained extension agents would start in late 1985, and they would be ready for extension activity in the 1986 crop season. Allowing for possible dropouts from the training program and possible defections to other fields of work, allowance has been made for training twice the number who enter the project. The training program has been tested under SURDP and has proven to be successful. The number of extension staff who would be available by source and year is shown in Annex 1, Table 3. Assurances were obtained that the Government would train at least 20 new extension agents per year for the project starting in 1984 until the project is completed (para 6.01(c)).
I/ The total number of extension centers which would be built, staffed and equipped during the project implementation period would be 34; each center would be staffed by one extension agent. Out of these, 11 are expected to be built under the Agricultural Research and Development Project (Credit 1259-YAR), and two already exist. The proposed project would, in addition to constructing, equipping, and staffing the above mentioned 21 centers, would supply the other 13 centers with the necessary equipment and staff. -16-
3.08 The project would also provide foreign training to about 10 extension specialists (extension agronomy, plant protection, livestock, farm machinery and home economics) for up to two years each. In addition, funds and equipment would be provided for training of farmers. This would be done on a continuous basis by the extension agents with assistance from subject matter specialists, research staff, and foreign experts.
3.09 Rural Water Supply Schemes. Fifteen water supply schemes would be constructed to serve about 45,000 people eventually. Typically, the works would include construction of access roads, drilling and equipping wells with diesel pumps housed in masonry structures, water transmission piping to storage reservoirs constructed at higher elevations, and distribution piping to deliver water to the surrounding villages. Presently, water supply for irrigation and drinking purposes is obtained from shallow wells and a few perennial springs. However, only limited knowledge is presently available on the potential of the aquifers. Therefore, the specific location of the wells would be selected during the course of project implementation based on information obtained in a detailed hydro-geological survey to investigate groundwater resources. Before designing the schemes, availability of water would have to be confirmed through a hydro-geological study, being financed under the Project Preparation Facility (PPF) under terms of reference acceptable to IDA. The 15 water supply schemes would be selected based on the results of this study. The design work would be finalized during implementation in consultation with and participation of the beneficiaries. Meanwhile, the cost estimate for the component is based on experience from similar schemes under SURDP. The water supply systems upon completion would be turned over for operation and maintenance to the LDAs in which the beneficiaries are organized. The eligibility criteria for financing the schemes are in Para. 4.08.
3.10 Studies. The project would include funds for study of a possible second phase project that may include areas in the eastern provinces. The study would also investigate the possibility of expanding the irrigated area in the two project governorates and in the Governorates of Ibb and Taiz through construction of small dams and diversion weirs to collect runoff from torrential rains. The study is projected to be completed by June 30, 1986; it would be done by a consulting firm to be selected in consultation with IDA. The terms of reference for the study would be reviewed by IDA.
3.11 Project Administration. Funds would be provided for setting up a Project Organization. The project includes funds for purchase of vehicles and office equipment, and for financing internationally recruited consultants and recurrent costs of local staff and other expense items through the implementation phase. -17-
D. ImplementationSchedule
3.12 The first year of the project is expected to be used mainly for building up the organization for the project's implementation,including the recruitment of key local and internationally recruited staff. Some demonstration of improved technological packages on farmers' fields would commence in 1985 using existing extension agents, but most would begin in the 1986 crop season. The timing for constructionof block centers and extension centers, and for the procurement of vehicles and demonstrationsupplies would be linked to the timing for the deployment in the field of extension agents. Constructionof the rural water supply schemes building would commence in 1985 and would be completedby 1988.
E. Cost Estimate
3.13 The cost of the project, including physical contingencies and allowances for expected price increases, is estimated to be YRls 90 million (USW20million) with a foreign exchange component of US$lO.9 million or 54%. The base cost estimate is calculated using unit costs for various items prevailing at the time of appraisal, adjusted to the end of 1983; it does not include taxes as the project will be exempt from taxes. Physical contingencieshave been computed at 10% for buildings and 15% for construction of water supply schemes. Allowances for expected price increases on the foreign exchange componenthave been computed at annual rates of 7.5% in 1984, 7% in 1985 and 6% per year for 1986, 1987, and 1988; for the local component, the allowances are 10% per year. The cost estimates are summarized below. Details on schedulesof expendituresare shown in Annex 1, Table 4. -18-
Project Cost Estimate
Foreign Item Local Foreign Total Local Foreign Total Exchange ---- (YRls Million(------(USTMillion) -----
Extension Development 15.4 14.9 30.3 3.4 3.3 6.7 49 Rural Water Supply 5.0 16.0 21.0 1.1 3.6 4.7 76 Studies 1.6 3.8 5.4 0.4 0.8 1.2 67 Project Administration 7.4 3.4 10.8 1.6 0.8 2.4 33 Base Cost 29.4 38.1 67.5 6.5 8.5 15.0 57 Contingencies: Physical (6%)/1 1.4 2.9 4.3 0.3 0.6 0.9 67
Expected Price Increase (25%) 10.3 7.9 18.2 2.3 1.8 4.1 44 Subtotal 11.7 10.8 22.5 2.6 2.4 5.0 48
Total Project Cost 41.1 48.9 90.0 9.1 10.9 20.0 54
/1 This is an average for all project components (see para. 3.13). -19-
F. Financing
3.14 The IDA credit of US$8 million and an IFAD loan of US$4 million would help to finance all project components. The Government of the UK has proposed to contribute about US$1.0 million to finance expatriate consultants for the extension service of Dhamar Governorate. The balance of the project cost would be financed by the Government (US$5.5 million), and LDAs (UStl.5 million).
3.15 Based on the above, the project's financing plan is summarized below:
Financing Plan /1
Item IDA IFAD ODA Government LDAs Total ------(US$ Million)------
Extension Development 3.1 1.5 1.0 3.3 - 8.9 Water Supply 3.3 1.7 - - 1.5 6.5 Studies 0.9 0.5 - - 1.4 Project 0.3 0.7 - 2.2 - 3.2 Administration Total 8.0 4.0 1.0 5.5 1.5 20.0
/1 Including contingencies. -20-
As a condition of effectiveness of the IDA credit, the Government would be required to submit to IDA satisfactory evidence that the execution and delivery, on behalf of the Borrower, of the IFAD Loan Agreement, and ODA Grant Agreement have been duly authorized or ratified by all necessary governmental action and all other conditions precedent to effectiveness of the loans have been fulfilled (para 6.02).
G. Procurement
3.16 Vehicles that would be needed by the extension service and project administration (costing about US$0.4 million including allowances for spare parts and contingencies) would be procured following international competitive bidding (ICB) in accordance with IDA's guidelines. Project buildings and the water supply schemes would be constructed over three years in scattered and remote locations and are unlikely to be attractive to contractors not already represented locally. Therefore, they woulcl be tendered under local procurement procedures. Local procedures are competitive and allow bids from foreign contractors; they are acceptable to IDA. Contracts under components financed by ODA would be let out following procurement procedures of that organization. All other project cost items are recurrent expenditures and assorted small purchases against which IDA ftnds would not be disbursed. Procurement of vehicles for the extension service and project administration, and tendering for water supply schemes and buildings for the extension service would be centralized under the Project Manager. For goods estimated to cost the equivalent of US$100,000 or more and for civil works estimated to cost the equivalent of US$300,000 or more, IDA would review and approve tender documents before they are issued.
3.17 The procurement procedures and amounts for the various project elements are shown below;
Project Element Procurement Method /1 Not ICB LCB Others Applicable Total ------(U $ Million)------
Civil Works - 10.7 - - 10.7 (4.6) (4.6) Equipment 0.4 - - - 0.4 (0.3) (0.3) Consultant Services - - - 5.2 5.2 (3.1) (3.1) Others - - 3.7 - 3.7 Total 0.4 10.7 3.7 5.2 20.0 (0.3) (4.6) (-) (3.1) (8.0)
/1 Figures in parenthesis are the respective amounts financed by the IDA Credit; they do not include amounts financed by IFAD on joint basis with IDA. -21-
H. Disbursement
3.18 The proposed IDA credit of US$8 and IFAD loan of US$4 million would be disbursed over 5 1/2 years as follows;
Category % of Expenditures to be Financed
(a) Vehicles (US$0.4 million) 100% of foreign expenditures
(b) Civil works contracts for construction of water supply schemes (US$3.3 million) 60%
(c) Civil works contracts for buildings (US$3.1 million) 851%
(d) Consultant services (US03.2 million) 100,%
(e) Water supply study-PPF /1 (US$1.0 million), and 100%
(f) Unallocated (US$1.0 million)
Disbursement would be made following receipt of standard documentation. An estimated schedule of disbursements of the IDA credit is summarized below and detailed in Annex 1, Table 5.
IDA Fiscal Year Disbursements 1985 1986 1987 1988 1989 1990 …US$Mil ion …-
Annual 1.8 1.9 1.2 1.0 11 1.0
Cumulative 1.8 3.7 4.9 5.9 7.0 8.0
The above estimates are based on projected phasing of the project's execution in terms of the timing for delivery of vehicles, the rate of construction of buildings and the water supply schemes, projected timing for hiring of consultants, and estimated timing for carrying out studies. The disbursement profile for the agricultural sector in YAR (based on a sample period of FY74-83 covering 12 projects of which 3 have been completed) shows disbursements extending over about 7 1/2 years, but the shorter disbursement period under the project is based on the following considerations; (a) 3 percent of the proposed IDA credit would be disbursed against vehicles for extension and project administration and the bulk of these vehicles are expected to be delivered by the end of the second year of the project, (b) 12 percent would be disbursed against a hydrogeological study for which funds under the PPF have already been approved, and (c) 25 percent would be disbursed against consultants for extension, project administration, and
/1 This includes cost of drilling test wells, some of which could be converted to production wells. -22- studies, and most of the consultants are projected to be recruited not later than the second year.- The remaining 60 percent of the IDA credit would be disbursed against buildings and water supply schemes. The buildings are simple, designs of similar buildings are available, and there is adequate capacity in the country to carry out the works. There would be 15 water supply schemes, and expereince under SURDP II (where 100 schemes are being constructed) shows that such works could be completed in a short time.
I. Environmental Impact
3.19 The project would have no detrimental impact on the environment. Changes in land use would be minimal. Care would be taken by the extension service to avoid the negative effect from use of plant protection chemicals. Their transportation and use, and the disposal of empty containers would be done under guidance from the extension service also. All of the above would be monitored during the course of project implementation.
IV. PROJECT IMPLEMENTATION
A. Implementing Agencies
4.01 General. The MAF would be responsible for implementing the project (an organigram is shown in Chart World Bank 25171.) To carry out its responsibilities, the MAF would appoint a Project Manager and support staff with responsibilities for; preparing project operational plans; coordinating the preparing project progress reports and a completion report; identifying implementation bottlenecks and taking appropriate measures to resolve them; processing tender documents; administering training of extensionists; keeping consolidated project accounts; supervising the studies to be undertaken under the project; and liaising with other government agencies and external donors on matters concerning the project. An Engineering Services Section under the Project Manager, consisting of internationally -recruited consultants and local counterparts would be responsible for: designinrgthe water supply schemes and preparing tender documents, evaluating tenders, and supervising- c-onstruction of these schemes. The staff would also process tender documents for procuring vehicles, and for constructing the block and extension centers, and building for project administration. Assurances were obtained that the expatriate staff of the Engineering Services Section would be recruited not later than January 1, 1985 (para 6.01(d)). -23-
4.02 MAF's regional branches for Dhamar and Sanaa Governorates would, in the respective governorates, supervise all extension activities; coordinate with CACB in the distribution of inputs; and prepare progress reports. The directors of the regional offices would serve as Deputy Project Managers. List of project staff is shown in Annex 1, Table 6.
4.03 Extension Service. The extension service in each governorate would operate under an overall direction of the respective Deputy Project Manager. The Deputy Project Manager would be assisted by an internationally recruited senior extension advisor who would be responsible for extension programming and implementation. The senior advisor would be assisted by one internationally recruited specialist each in the fields of livestock, home economics, farm machinery, and local counterparts in these fields who would also receive on-the-job training; there would also be one specialist each in the field of plant protection and fruit tree production who would serve both governorates. The senior advisor and specialists would be responsible for translating the extension programs into extension packages using relevant data from research and other projects. Following monthly meetings at block center level, the specialist staff would meet at governorate level to review progress, to discuss and agree on future programs. The home economist would work through block centers making contacts with women groups through local associations and through the families of leader farmers.
4.04 Each block center would be administered by a supervisor who would report to the Deputy Manager; the supervisor would also serve as the link between extension and research. The block center would be staffed by a supervisor assisted by an expatriate extension agronomist and by three local specialists (plant protection, livestock and farm machinery) to be recruited mainly from among graduates of the Ibb Agricultural Secondary School and by one other person who would serve as a storekeeper/clerk and messenger. The supervisor, with assistance of the extension agronomist at the block center, would be responsible for preparing annual and monthly extension programs and for developing topical monthly training courses. They would also visit agents regularly in the course of their work to review and advise on their approach and methods and would make regular scheduled and unscheduled visits to agents in their charge. Subject matter specialists would make frequent visits to village agents to review and assist in specific subjects as part of a monthly program and to deal with specific enquiries on request. They would also participate in program formulation and training sessions. -24-
4.05 The organizationof extension at field level would be designed along lines similar to those already proven under SURDP. Each village extension agent would be expected to spend five days per week visiting the villages of his area including visits for demonstrations, field days and farmer training. He would visit the block center, at least monthly, to report on the previous month's activitiesand problems, to discuss and agree on the program of visits and work for the following month, to collect data, and to receive regular topical in-service training. Leader farmers nominated by the community, in consultation with the extensionists, would be the initial and main contact between the extension agent and the farm community. Through the leader farmer and his family, contact would also be made with female household heads who otherwise might remain outside the influence of the extension service. The main vehicle for conveying extension packages would be through field demonstrations.
4.06 There would be close contact between extension personnel and research staff. The extension service would transmit to research scientists technical problems confronting farmers so that these problems would be incorporatedin research programs. Research staff would also serve as subject matter specialists. Under the Agricultural Research and Development Project (Credit 1259-YAR), research scientists are expected to involve the extension agents in field verification trails during which intensive on-site training would be provided to the extension agents. Frequent meetings would be organized between research and extension staff to exchange information. The Research Project also provides a liaison officer, on a full time basis, to serve as the link between research and extension. As part of the inservice training of extension agents, tours would be organized on a regular basis to research centers. The senior extension staff would ensure that extension programming would include regular and close linkage between extension and research.
B. The Borrower
4.07 The borrower of the IDA credit woulcLbe the Government of the Yemen Arab Republic. The Government, through the MAF, would utilize the IDA credit to finance; vehicles for the extension development and project administration (US$0.3 million); civil works for construction of block centers, extension centers, and an office building and water supply schemes (US$3.9 million); and consultant services (US$3.1 million). The remaining US$0.7 million will be unallocated./Il
C. Terms and Conditions of Financing Water Supply Scehmes
4.08 The beneficiary communities of the water supply schemes would finance the entire cost of land for pump houses and water reservoirs, access roads and the cost of water distribution network from storage reservoirs to the villages. Assistance to the beneficiarieswould depend on;
(a) approval by CYDA of the schemes' priority;
(b) agreement by the beneficiary communities to contribute their share of project cost, and to deposit 10% of project costs in escrow upon concluding the agreement with the project administration;
/1 The discussion in this paragraph refers to only IDA's financing. -25-
(c) agreement by the beneficiary communities to bear all costs of operation and maintenance of the completed schemes and to properly maintain the constructed schemes; and
(d) IDA's review and approval of the design of the Water Supply Schemes, prior to their construction, in accordance with the standards set out in Annex 1, Table 7.
Assurances were obtained that the above factors would be conditions for financing the Water Supply Schemes (para 6.01(e)). The completed water supply schemes are envisaged to be operated and maintained by mechanics to be con- tracted by the beneficiaries, with technical guidance and training from staff of the Engineering Services Unit; a similar arrangement is being applied satisfactorily under SURDP.
D. Progress Reporting, Monitoring and Evaluation
4.09 Responsibility for preparing progress and completion reports, and for monitoring and evaluation of the project would rest with MAF. The Project Manager would coordinate the preparation of all reports and consolidate the same for submission to IDA.
4.10 Progress reports would be prepared twice each calendar year covering the periods January-June and July-December, and submitted to IDA not later than September of the same year and March of the next year respectively. The first progress report would be due not later than March 31, 1985 covering the progress during July-December 1984. The information to be included in the reports and suggested format for presenting data have been reviewed and assurance to this effect obtained during negotiations (para 6.01 (f)) . MAF would submit a completion report on the project not later than six months after the project's completion or such later date as IDA and the Government may agree. Assurances were obtained to this effect (para 6.01(g)).
4.11 Monitoring and evaluation of the project would be done by specialized staff consisting of an internationally recruited consultant and a local counterpart; the project provides 2 1/2 man-years of internationally recruited advisor at a cost of about US$45,000/man-year. The unit would be part of the Department of Planning, Statistics, and Follow-up of MAF, which has already been established within the Ministry to, inter alia, monitor and evaluate agricultural projects. Monitoring and evaluation staff of the project would report directly to the Minister of Agriculture through the General Director of Planning, Statistics, and Follow-Up. Assurances were obtained that the M&E advisor would be recruited not later than January 1, 1986 (para 6.01(h)). Assurance were also obtained that the Government would conduct a mid-term project evaluation, in which IDA and co-financiers would be invited to participate, not later than December 31, 1985 (para. 6.01(i)).
E. Accounts and Audits
4.12 The MAF would maintain separate accounts of expenditures on the project. These accounts, maintained according to sound and consistently applied accounting principles, would accurately reflect receipts and expenditures undertaken for the project and clearly identify the goods and services procured and the works performed. The accounts would be audited annually by independent auditors acceptable to IDA. A copy of the certified audit reports, together with certified copies of the audited accounts, would -26-
be submitted to IDA within six months of the close of each fiscal year; similar procedure is being applied under SURDP. The first audit report would be submitted to IDA by June 30, 1985. Assurances were obtained to this effect (para 6.01(j)).
V. BENEFITS AND JUSTIFICATION
A. Impact on Production
5.01 General. The project would increase the production of sorghum, wheat, maize, vegetables, coffee and fruit. The crops are not new to the project area having been under cultivation for many years. The project would concentrate on increasing production in areas where the rainfall exceeds 450 mm per year and/or where there is supplementary irrigation.
5.02 The number of farmers who would participate in the project and the area which can be developed would depend on the mobility of extension agents and the area they could cover in the course of their work; the density and size of villages and their distance from extension centers; the complexity of technical packages and consequent frequency of required visits by the extension agents; the level of technical andl administrative backstopping provided to the extension agents; maintenance of a continuing supply of technical innovations for extension; and the farmer:agent ratio. These factors and experience from SURDP have been taken into consideration in determining the extension service needs of the project area.
5.03 Extension Program and Adoption Rateis. The available extension packages (paras. 2.18-2.20), developed primarily in the SURDP are simple and applicable to the project area, and given convincing demonstrations could be adopted in their entirety by farmers in the area. Adoption is expected to be highest among the most progressive farmers who would be selected for demonstration purposes, and who would be in constant contact with extension agents; adoption rates by other farmers would be less.
5.04 The organization of extension at field level would be designed along lines similar to those already proven in SURDP. The performance of extension agents in establishing farmer contact and in promoting new techniques is also based on experience at SURDP modified as necessary recognizing the more difficult conditions in the Central Highlands.
5.05 From experience gained in SURDP, a generally acceptable ratio of farmers to village extension agent ranges from 500:1 in areas where only simple rainfed practices are involved to 300:1 in predominantly irrigated areas. These ratios are modified for the project taking into account the more rugged topography and the density of villages-, on the average, the ratio would be 245:1. The concentration of villages in most or all areas would require travel of about 25 km to the most distant village and an average distance of about 5 km.
5.06 The following parameters have been used in projecting the number of households to be reached in different years and the area to be developed:
(a) each extension agent would establish contact, working closely with and providing training to lead farmers beginning with five in his first year, increasing to nine in his second year, and stabilizing at 12 from the third year; -27-
(b) the extension agent would establish at least one appropriate demonstration each year on land owned by each lead farmer. During his first year of participation, each lead farmer would select one contact farmer who, with the extension agent's assistance, would establish also a demonstration plot. By the second year, the number of contact farmers per lead farmer would be expected to grow to about 10 with some variation depending on location of the service area. Each contact farmer would follow closely the practices being introduced on the farm of the lead farmer;
(c) having observed results on lead and contact farmers' plots, other neighboring farmers (followers) would begin to adopt some of the practices demonstrated. For each contact farmer there would be one follower the year after; and
(d) some of the demonstration plots in irrigated areas would be established during the second planting season. Most would be concerned with annual crop production practices but others would be concerned with machinery use and tree crop production techniques.
Based on the above and allowing for some variation depending on the location of the service area, each extension agent would influence production on 240 to 250 farms by the fifth year of extension. By the ninth year of the project, all extension agents would influence production on about 8,325 farms. From this time, the number of extension beneficiaries is expected to stabilize with some rotation of farmers joining and others leaving. A steady flow of new technological packages is essential for the continuing appeal of the extension service.
5.07 The number of farmers who would be able to enter the project each year, and the project areas owned by such beneficiaries which would be developed are projected as follows;
Participating Farmers Areas To Be Developed Year Annual Cumulative Annual Cumulative …-----…(ha) …
1984 1985 70 70 160 160 1986 455 525 965 1,125 1987 1,060 1,585 2,135 3,260 1988 1,740 3,325 3,440 6,700 1989 2,100 5,425 4,100 10,800 1990 1,700 7,125 3,390 14,190 1991 1,000 8,125 1,810 16,000 1992 200 8,325 430 16,430
The total area now cultivated by the 8,325 farm families amounts to 23,670 ha, but the project would develop only about 16,430 ha using known and proven technology. The number of farms represented by each model which would enter the project at different times are shown in Annex 1, Table 8. -28-
5.08 The process of technological adoption would start with improvements that would yield good results, moving gradually to the more complex and riskier innovations. The initial effort would focus on use of improved varieties of seeds (where applicable), and application of s,eed treatment and of improved land preparation. Proper use of chemical fertilizers is expected to be adopted more gradually. Each farmer is projected to take 4-5 years to adopt the recommended technological packages if these would not involve planting of fruit and coffee; the period of development would be 8-9 years for farms where fruit crops would be established. For the project as a whole, the projected adoption period would be about 15 years. In response to the improved cultural practices of production, average crop yields are projected to increase by 40-60%
5.09 Cropping Pattern and Production. The existing and future cropping pattern and production from the areas to be developed under the project (based on average yields for different ecological zones, and rainfed and irrigated areas) are shown below;
Future Present Production /1 Area Production /1 Area Total Incremental ha) ---(tons)---- (ha) ------(tons)------
Crops
Sorghum 9,475 8,480 9,340 12,140 3,660 Wheat 3,080 3,090 3,020 4,870 1,780 Maize 2,470 4,660 2,405 6,620 1,960 Vegetables /2 895 14,400 1,025 26,390 11,990 Alfalfa 375 9,370 375 14,060 4,690 Fruit - - 105 2,080 2,080 Coffee /3 60 36 160 189 153 Fallow 75 - - - _ By-Products: Sorghum - 25,450 - 36,420 10,970 Wheat - 3,700 - 5,830 2,130 Maize - 13,510 - 19,200 5,690 Total 16,430 16,430
Crop outputs by years from areas to be developed under the project are shown in Annex 1, Table 9.
/1 Outputs of wheat and vegetables include production from double-cropped areas.
/2 Including potatoes.
/3 The output of coffee would help in arresting the declining trend in domestic production of the commodity. Export of coffee has declined from a high of YRls 10.2 million (US$ 2.3 million) in mid 1970's to about YRls 2.2 million (US$ 0.5 million) recently. Some of the incremental output may be exported, but since the quantity is insignificant it would have little or no effect on the country's export trade in the commodity. -29-
B. Marketing, Markets, and Prices
5.10 Marketing. Marketing of agricultural products is basically free of government intervention with the public sector's functions limited to the collection of some market information. Marketing is undertaken almost exclusively by the private sector and prices and market margins for domesti- cally produced commodities are determined by the free interplay of demand and supply.
5.11 Many smallholder farmers sell their products in urban markets in addition to selling through numerous marketing channels at the farm and village centers. The opening of several permanent shops in the countryside along roads and in large villages replacing the weekly markets has expanded the marketing outlets. Cash remittances from abroad have enabled a growing number of villagers to own transport vehicles. This, combined with an expanded network of rural roads, has provided farmers with a high degree of mobility and access to market centers. Furthermore, many farmers own television and radio sets which also increase their awareness of factors influencing production and marketing decisions. The above implies a domestic marketing structure and organization which provides an efficient flow of information between consumers and producers. This would be the environment under which project outputs would be marketed.
5.12 The Government's direct involvement in marketing is limited to imported foodstuffs. A committee of public and private representatives under the aegis of the Ministry of Trade and Supply (MTS) determines import require- ments in the light of domestic demand and supply conditions. Import quotas are allocated to participating private importers and public corporations in a ratio of 60:40 respectively. Maximum prices are also fixed by the committee for importers, wholesalers and retailers. These are strictly observed at the levels of import and wholesale with some 150 inspectors to monitor the prices at the retail level; few retailers observe the price limits. The pronounced preference of Yemeni consumers for domestically produced foods presents farmers with premium prices for their products despite the availability of imported alternatives.
5.13 Markets. All project outputs would be consumed domestically, except for some of the coffee (some 100 tons) which may be exported. With rapidly rising demand for food caused by rising population and income, agricultural imports, particularly food, have increased substantially. Although the country is making progress to satisfy part of the growing demand for food, particularly sorghum and vegetables, it is likely to remain a net importer of key grains in the foreseeable future; project outputs would be used to satisfy part of this demand. As the incremental volumes, which would be attained over an extended period of 15 years, would account for only a small proportion of the total domestic supply and reduced imports, project outputs are not expected to have an impact on the domestic price levels.
5.14 Prices. Domestic prices have been used for financial evaluation of the project's impact on the beneficiaries' income. For computing the economic rate of return (ERR), domestic prices have been used for non-tradeables (such as crop by-products) and for commodities where there are no significant differences between domestic and import prices. For others, the prices used -30- have been derived from projections of international prices for comparable commodities. These are generally lower than prices of similar commodities produced domestically reflecting the premium consumers attach to crops grown in the country. However, since the country has the option to import cheaper commodities which are nutritionally comparabLe to crops grown domestically, the lower international prices have been used for the economic analysis. The financial and economic prices are shown in Annex 1, Table 10.
C. Impact on Beneficiaries' Income.
5.15 Beneficiaries. The 8,325 farm families who would benefit from the agricultural development effort would represent about 45,000 people. The farm families are heterogeneous in their size and location of holdings, types of agriculture practiced, crops grown, yields obtained, and income. To take account of these differences, six farm models have been prepared corresponding to cropping systems in various ecological zones (Chapter II). The number of farms, total areas cultivated, and land to be developed for each model are shown below:
Number of Farms Area of Holding Land To Be Developed Model Total % Per Farm Total Per Farm Total Area …h …______------ha------
1 4,000 48 3.0 12,000 2.4 9,600 58 2 2,400 29 2.0 4,800 1.9 4,560 28 3 1,000 12 5.0 5,000 1.2 1,200 7 4 600 7 1.2 720 0.4 240 2 5 125 2 6.0 750 3.6 450 3 6 200 2 2.0 400 1.9 380 2
Total 8,325 100 23,670 16,430 100
The above data are based on results of an agricultural census conducted by MAF during 1977-82. The present cropping pattern on total area of holding represented by each model, and the future cropping pattern on land to be developed under the project are shown in Annex 1, Table 11 and 12 respectively. A description of the models is summarized below.
5.16 The first model represents farmers depending entirely on rainfed agriculture in terraced areas where the annual rainfall exceeds 450 mm. The average size of holdings is estimated at 3 ha of which only 2.4 ha can be developed by introducing seed treatment; using improved seeds, chemical fertilizers, and instecides; and by improving seed-bed preparation.
5.17 The second model represents farmers who practice agriculture in terraced areas under rainfed and irrigated conditions. Average size of holdings is estimated at about 2.0 ha (1.5 ha under rainfed and 0.5 ha under irrigation) of which 1.9 ha would be developed. Technological packages to be introduced would be the same as for the first model, although the impact of improved cultural practices would be different because of the irrigated area. -31-
5.18 Farms represented by the third model are located in areas receiving less than 450 mm of rainfall for which there are no proven technological packages for rainfed agricultural development. However, there are existing surface and groundwater resources which can be used for irrigation development. Average size of holdings is estimated at about 5 ha including 1.2 ha under irrigation. Development under the project would focus on the irrigated area where yields can be improved through proper irrigation practices, use of improved varieties of seeds, better timing and quality of seed-bed preparation, and use of farm chemicals.
5.19 The fourth model is representative of farms with potential for intensive production of high value crops under irrigation. They are located along wadi floors. Development would focus on production of vegetables, fruit and coffee on an area of 0.4 ha out of a total holding of 1.2 ha. The area under perennial crops would be expanded.
5.20 The fifth model represents multi-family owned farms located in the intermontane plains where development would focus on irrigation improvement. Average size of holdings is estimated at about 6 ha including 2.4 ha currently under irrigation. The irrigated area would be increased to 3.6 ha by improving irrigation efficiency.
5.21 The sixth model consists of farms which include both rainfed and irrigated cultivation in terraces. Unlike the second model, where there is no change in the cropping pattern and the area under irrigation, possibilities exist on these farms for the expansion of the irrigated area and improvement of rainfed agriculture. Average size of holdings is estimated at 2 ha, of which 0.5 ha is presently irrigated and about 1.9 ha would be developed. By improving the irrigation efficiency, enough water would be saved to double the irrigated area and to increase the crop intensity.
5.22 Benefits. At present, the net benefit to the farm family from all areas owned by the farmers ranges between YRls 1,850 (US$410) for the first model and YRls 10,110 (US$2,245) for model 5 with the corresponding return to family labor of YRls 18 to 64 (US$4 to 14) per workday. Under the project, net farm benefits would increase by 70 to 100% on farms where there would be no perennial crop development; for farms where there would be perennial crop development, the incremental net benefits would exceed 200% but these would be attained over a fairly extended period of about 9 years. Thus, although the project would develop only part of the area owned by the farmers, this effort would have a substantial impact on the overall household income. The costs and benefits for each model are summarized below and detailed in Annex 1, Tables 13-18. -32-
Models Item 1 2 3 4 5 6 ------(YRis)-
Present
Value of Production 8,820 13,960 21,850 18,560 41,800 13,960 Cost of Production /_ 6,970 8,860 14,990 9,650 31,690 8,600 Net Farm Benefit: Per Household 1,850 5,100 6,860 8,910 10,110 5,360 Per Family Workday 16 37 33 64 31 39
With Project
Value of Production 12,220 21,050 31,150 36,370 106,070 40,460 Cost of Production /1 9,130 11,450 16,490 11,770 56,065 17,600 Net Farm Benefit: Per Household 3,090 9,600 14,660 24,600 50,005 22,860 Per Family Workday 24 62 64 135 100 118
5.23 The expenses the farmers would incur to get the above benefits would be the cost of technological packages to be recommended by the extension service. The investment in building the institutional support services would be public expenditures not chargeable to the farmers. The direct expenses of adopting the technological packages would increase the annual cost of production by 10% to 30%. Most farm households would finance the additional expenses from their own resources and/or with assistance from relatives working in oil producing countries. A few are expected to borrow from CACB, which has received IDA funds under the Agricultural Credit Project partly to finance subprojects in the area. The modest increase in the production cost would result in a substantial increase in family income. Therefore, the farmers would have substantial financial gains which would serve as incentives for them to participate in the project. The Government would also gain through increased annual tax receipts from an estimated YRls 5.8 million (US$1.3 million) at present to about YRls 9.3 million (US$2.1 million) at full development, an increase of about YRls 105 million (US$23.3 million) over the estimated life of the project.
/1 Excluding family labor. -33-
D. Economic Rate of Return
5.24 The economic rate of return (ERR) on investment in the agricultural development component is computed at 27%. This is based on the following assumptionsand parameters;
(a) the cropping pattern, yields and their development, number of participants in the project and area cultivated by them, and rates of adoptions of technological packages are as discussed in paras 5.02-5.09;
(b) projected incrementaloutput of crops by years as shown in Annex 1, Table 9;
(c) production without the project is assumed to remain unchanged because insufficientextension service woule continue to be the main constraint to the adoption by farmers of improved technological packages, and without improved cultural practices no significant increase in production can be expected;
(d) prices of outputs are as shown in Annex 1, Table 10;
(e) costs of production of different crops as presented in Annex 1, Tables 19-25; and
(f) the incremental cost of hired labor is valued at the market wage rate (YRls 60/man day) determined by the free interplay of demand and supply. Incremental family labor is shadow priced at zero since supply of available household labor far exceeds demand. Despite the excess supply of family labor, there continues to be demand for hired labor (mainly to perform tasks the family considersunpleasant) reflectingthe premium the family attaches to leisure.
5.25 Even if the cost of the water supply is included in the cost,streams without benefits attributable to this component, the ERR on the investment would be satisfactoryat 21%. Results of other sensitivity tests are shown below;
Combinationsof Tests Economic Rate of Return …_ _ __ _( %) …------
(a) AgriculturalDevelopment only
Basic run 27 20% increase in costs 21 20% decrease in benefits 20 Benefits lag by two years 17 20% decrease in benefits & 20% increase in costs 14 Family labor valued at market wage rate 20 Switchingvalues at 12%: benefits -37 costs +58 -34-
(b) AgriculturalDevelopment and Water Supply
Initial run 21 20% increase in costs 16 20% decrease in benefits 15 Benefits lag by two years 14 20% decrease in benefits & 20% increase in costs 10 Switching values at 12% benefits -29 costs +41
5.26 The net present value (NPV) of the agricultural development component, discounted at 12% over an assumed project life of 30 years, is computed at YRls 79 million (US$17.5 million). The economic cost and benefit streams used in computing the ERR are shown in Annex 1, Table 26. At full development the incrementalvalue of project commodities,valued at economic prices, would amount to about YRls 55.0 million (US$12.2 million) per year, which is equivalent to less than 2% of the recent level of major food and agriculturalimports.
E. Risks
5.27 As in other rainfed agriculturaldevelopment projects, the project is subject to risks associated with uncertaintiiesconcerning the amount and timing of rainfall. In periods of low rainfall, farmers would likely be reluctant to apply fertilizersand may be extra cautious in the use of other purchased inputs. To remedy the situation and to build farmers' confidence, the process of technologicaladoption would start first with improvementsthat would give good returns without excessive risks such as seed treatment and use of improved seeds, inter-row cultivation, and weed control. It would move gradually towards riskier investments such as use of chemical fertilizers. Even in the case of fertilizer use, the extension service would introduce split application to minimize loss in case of poor rainfall and to maximize benefits in periods of good rainfall. As nitrogenous fertilizersare normally leachable, a split application could be used for winter crops which would allow for better response in years of average--or-betterrainfall. When the rainfall condition is poor, the second application can be eliminated as it would have no impact on production.
5.28 There are also risks associated with possible slow start up of the project. An important factor to the success of the project is the speed with which the project organizationand the extension service would be established. These would require timely recruitment of local and expatriate staff, and training of extension personnel. The Government is aware of the critical steps in building up the project institutions,but whether it would follow the proposed timetable depends on several factors such as the availability of local and expatriate personnel, and the financial resources to pay for them. The relatively generous financial rewards being allowed under the government's pay scale for staff working in special projects, and the proximity of the area to the capital city, may serve as incentives for local staff to join the -35- project. Also, it may be possible to transfer to the project some staff who have been under in-service training in other projects. The Government would soon have to start aggressively recruiting expatriates. Concerning local financing needs, the design of the project takes into account the capability of the Government to contribute its share of the project cost by limiting the project to manageable size. Since the project is a top priority concern of the Government, it is expected to receive priority in allocation of public funds in the face of possible budgetary retrenchment.
VI. AGREEMENTS REACHED AND RECOMMENDATION
6.01 During negotiations, assurances were obtained that the Government would:
(a) not authorize drilling of new wells for irrigation in the project area until hydrological studies which are on-going or planned have proven availability of groundwater for additional exploitation (para 2.08);
(b) recruit the senior extension advisor financed by IDA and IFAD not later than January 1, 1985 and the other internationally recruited extension specialists financed by IDA and IFAD not later than July 1, 1985 (para 3.06);
(c) train at least 20 new extension agents per year for the project starting in 1984 until the project is completed (para 3.07);
(d) recruit the expatriate staff of the Engineering Services Section not later than January 1, 1985 (para 4.01);
(e) ensure that financing of the Water Supply Schemes be con- ditional on factors listed in para 4.08;
(f) submit to IDA necessary data and information on all project components through semiannual reports beginning with March 31, 1985 and every six months thereafter (para 4.10);
(g) prepare and furnish to IDA a completion report on the project not later than six months after the project's completion or such later date as may be agreed for this purpose between the Government and IDA (para 4.10);
(h) recruit a monitoring and evaluation advisor not later than January 1, 1986 (para 4.11);
(i) conduct a mid-term project evaluation, in which IDA and co-financiers would be invited to participate, not later than December 31, 1985 (para. 4.11); and
(j) ensure that separate project accounts would be kept, that these accounts would be audited by independent auditors acceptable to IDA, and that certified copies of the audit reports would be submitted to IDA within six months of the close of each fiscal year starting with the audit report for the fiscal year ending on December 31, 1984 (para 4.12). -36-
6.02 The following would be a condition of effectivenessof the proposed IDA credit: the Government's submission to IDA of satisfactory evidence that execution and delivery, on behalf of the Borrower, of the IFAD Loan Agreement and ODA Grant Agreement have been duly authorizedor ratified by all necessary governmentalaction and all other conditions precedent to effectivenessof the said loans have been fulfilled (para. 3.15).
6.03 Agreement having been reached on the above, the project is suitable for an IDA credit of US$8 million on standard terms. The Borrower would be the Government of Yemen Arab Republic. YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENTPROJECT
Population and Villages in the Project Districts
Sanaa Governorate Al Haymat Al Haymat Item Sanhan Bilad Arrus Bani Matar Dakhiliyah Kharijiyah Total
Households Total Rural Households 5,130 2,160 8,170 7,160 6,230 28,850 Total Agricultural Households 4,150 2,040 6,790 6,050 4,970 24,000
Population Total Rural Population 26,750 13,560 50,510 46,050 35,300 172,170 Agricultural Population 21,600 12,800 42,000 38,900 28,100 143,400
Agricultural Household Size 5.2 6.3 6.2 6.4 5.7 6.0
Villages & Hamlets Villages 42 43 235 148 262 730 Hamlets 14 11 93 290 229 741 Agricultural Households per Village 99 47 29 41 19 33
Dhamar Governorate Dhamar Mabar Al Hada Jabel As Sharg Dawraan Total
Households Total Rural Households 14,050 5,640 5,860 3,020 7,000 35,570 Total Agricultural Households 12,210 4,430 5,450 2,880 5,670 30,640
Population Total Rural Population 75,880 33,170 34,480 16,130 35,010 194,670 Agricultural Population 65,900 26,100 32,000 13,100 28,400 165,500
Agricultural Household Size 5.4 5.9 5.9 4.5 5.0 5.4
Villages and Hamlets Villages 216 48 191 97 364 916 Hamlets 51 17 73 221 122 484 Agricultural Households per Village 57 92 29 30 16 33 fHtm rnXZ -38- ANNEX 1 Table 2
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
List of Vehicle Requirements
Item Quantity Unit Price/l Total Value./2 Y-RRlsJ -- -(YRls '000)-
Extension Development Pickups 12 55,000 660 4 Wheel drive 20 31,000 620 Motorcycles 14 6,000 84
Project Administration Pickups 7 55,000 385
/1 Including spare parts. 7> Excluding allowance for expected price increases. -39- ANNEX I Table 3
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Source of Extension Service Staff
Source 1984 1985 1986 1987
Ibb Agricultural Institute From military service 4 / _ _
Directly after graduation /1 4 __ 4 /2
Existing in Project Area Sanaa 1 - - - Dhamar 3 _ _ _
Trainees for Appointment - 12 /3 12 /3 12 /3
Total Annual Input 12 16 12 12
Annual Wastage 4/ 2 2 2 2
Net Addition 10 14 10 10
Cumulative Total 10 24 34 44 of which; Village Extension Agents 4 14 24 34
/1 Assuming that 10% of recruits from the project area now under military service would become available for employment in the project area. /2 Actual number of Ibb trainees who are from the Dhamar and Sanaa governorates. /3 Assuming 60% selected complete the training course. Available for posting about July-August of year shown. 4 Attrition during first year. YEMENARAB REPUBLIC CENTRALHIGhLANDS AGRICULTURAL DEVELOPMENTPROJECT
Project Cost Estimate
Total Cost 1984 1985 1986 1987 1988
Local Foreige Total Ench.oge Lotal Foreign Total Local Foeig Total Local Foreigo Total Local Foreige Totol Local Foreign Total ------(TK(a' l ------) ------(YRI '000).------teteosiosioolopm ept Boildisga b,480 4,320 10,800 40 - - - 850 570 1,420 1,370 910 2,280 2,120 1,410 3,530 2,140 1,430 3,570 6 Vehiclos Operating Coat 180 1,070 2,050 91 - - - 40 620 660 55 685 740 50 430 480 35 135 170 B.omatration Sapplies 65 715 780 92 - _ _ 15 235 250 20 280 300 15 100 115 15 100 115 Exte.aica Staff 6,905 5,620 12,525 45 - - - 860 1,180 2,040 2,025 2,140 4,165 2,460 2,300 4,760 1,560 - 1,560 Tra-iinE of E.t...ejoiite 1,160 1,E00 2,960 61 240 - 240 360 - 360 390 900 1,290 170 900 1,070 - - M-ecellmeoous Enpenase 595 570 1,165 49 - - - 85 150 235 180 230 410 165 95 260 165 95 260 boa2 15,385 14,095 30,280 49 240 - 2402,210 2,755 4,965 4,040 5,145 9,185 4,980 5,23910,215 3,915 1,7760 5,675 REaal Watet Sapply Source Ieveetigatice 920 3,970 1 4,8901 5 81 920 3,970 4,890 ------Ccat, tuc-c E Schemes 4,035 12,108 6J 3 75 - - - 540 L±?2 3J ,8 3,40 4,28 108 40 4Q2 LL4L 4,000 5,3 SubLotal 4,935 16,070 21,025 76 920 3,970 4,890 540 1,620 2,160 1 3,240 4,320 1,080 3,240 4,320 1,335 4,000 5,335 Phone Studios of 11 1,620 3,790 5,410 70 - - - 1,080 2,530 3,610 540 1,260 1,800 ------Pojoct Ads,i-ertration Aduinis-traice Statf 3,980 - 3,980 - 500 - 500 825 - 825 885 - 885 885 - 885 885 - 885 Eng.neertag Services Stoff 2,320 1,600 3,920 41 - - - 600 480 1,080 600 480 1,080 560 320 880 560 320 880 MhE Staff 300 480 780 61 - - - - _ - 100 160 260 100 160 260 100 160 260 4 Cost VEhioles Oper-ting 115 830 945 88 35 510 545 20 80 100 20 80 100 20 80 100 20 80 100 Oftice Space 6 FPrnit-re 540 475 1,015 47 70 170 240 215 305 020 85 - 85 85 - 85 85 - 85 tlincellaoecus topoonon 100 - 160 - - - 25 - 25 45 - 45 45 - 45 4 Subtotal 7,415 3,385 10,800 31 605 680 1,285 1,685 865 2,550 1,735 720 2,435 560 2,255 1,695 560 2,255
Total Cost b..e 29,375 38,140 67,515 56 1,765 4,650 6,415 5,515 7,770 13,285 7,395 10,365 17,760 7,755 9,035 16,790 6,945 6,320 13,265 Coot ingest inn Physical 1,410 2,875 4,285 67 140 595 735 190 330 520 300 580 880 370 630 1,000 410 740 1,150 Enpec-ed Prce- Increase 10,305 7,900 18,205 43 95 200 295 910 890 1,800 2,080 1,970 4,050 3.2<0 2,510 5,760 3,970 2,330 6,300 Subtotal 11,715 10,775 22,490 48 235 79 1,030 1,100 1,210 2,320 2,380 2,550 4,930 3,620 3,140 6,760 4,380 3,070 7,450
G-snd Total 41,090 40,915 90,005 54 2,000 5,445 7,445 6,615 8,980 15,605 9,775 12,915 22,690 11,375 12,175 23,550 11,325 9,390 20,715 -41- ANNEX 1 Table 5
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Estimated Schedule of Disbursements of IDA Credit
IDA Fiscal Year Quarterly Disbursement Cumulative Disbursement amd Quarter Ending Percentage ------US$ Million------
1985 September 30, 1984 0.3 0.3 3.7 December 31, 1984 0.3 0.6 7.5 March 31, 1985 0.7 1.3 16.2 June 30, 1985 0.5 1.8 22.5
1986 September 30, 1985 0.3 3.1 26.2 December 31, 1985 0.5 2.6 32.5 March 31, 1986 0.6 1.2 40.0 June 30, 1986 0.5 3.7 46.2
1987 September 30, 1986 0.3 4.0 50.0 December 31, 1986 0.3 4.3 53.7 March 31, 1987 0.3 4.6 57.5 June 30, 1987 0.3 4.9 61.2
1988 September 30, 1987 0.3 5.2 65.0 December 31, 1987 0.3 5.5 58.7 March 31, 1988 0.2 5.7 71.2 June 30, 1988 0.2 5.9 73.7
1989 September 30, 1988 0.2 6.1 76.2 December 31, 1988 0.3 6.4 80.0 March 31, 1989 0.3 6.7 83.7 June 30, 1989 0.3 7.0 87.5
1990 September 30, 1989 0.4 7.4 92.5 December 31, 1989 0.6 8.0 100.0 -42- ANNEX 1 TabTe 6
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENTPROJECT
Project Staff
Number Expatriate Local Total
Administrative Staff Project Manager - 1 1 Deputy Managers - 2 2 Administration Officers - 2 2 Public Relations Officers - 2 2 Accountant - 1 1 Purchaser - 1 1 Secretaries - 2 2 Drivers _ 3 3 Messenger - 1 1 Guards _ 2 2
Subtotal 17 17
Engineering Services Staff Chief Engineer 1 - 1 Civil/Irrigation Engineer 1 - 1 Design Engineers 2 - 2 Hydrogeologist 1 - 1 Surveyors - 2 2 Supervisors - 2 2 Draftsmen - 2 2 Engineers _ 2 2
Subtotal 5 8 13
Extension Staff Senior Extension Advisors 2 - 2 Plant Protection Specialists 1 6 7 Livestock Specialists 2 6 8 Farm Machinery Operation & Maintenance Engineers 2 6 8 Female Extensionists 2 - 2 Extension Agronomists 4 - 4 Fruit Tree Production Technician 1 - 1 Supervisors - 4 4 Extension Agents 34 34 Storekeepers/Messengers 4 4
Subtotal 14 60 74 Monitoring and Evaluation 1 1 2 Total 20 86 106 -43- ANNEX 1 Table 7
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENTPROJECT
Design Criteria for Rural Water Supply Schemes
Average Design Period 15 years or capacity of water source.
Per Capita Consumption Not to exceed 45 liters/day (lcd).
Well Location, Construction and Spacing To be determined by hydrogeological study.
Pumps Vertical turbine/submersible.
Pump Drive Diesel oil engine drive/electric motor (if electricity is available). Provide 30 day supply fuel oil tank.
Pump House Concrete block with reinforced concrete frame structure and roof.
Piping and fittings Galvanized steel/PVC.
Filtration (if required) Slow and filters.
Distribution and Storage Tank Reinforced concrete structure with roof, access, overflow and drainpipes. Provide 12 hours minimum storage capacity. Tanks to be ground storage type.
Distribution Network Maximum distance to any public fountain should not exceed 200 m. Each fountain to be with 1 to 4 taps as required. Maximum of 200 people per tap. House connection diameter not exceeding 1/2 inch.
Access Road Gravel or equivalent with concrete pipe culverts as required. -44-
ANNEX 1 Table 8
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Cumulative Number of Farmers Participating in Project
Models
Project Year 1 2 3 4 5 6 Total
1 ------2 20 - - - 10 40 70 3 180 100 40 30 65 110 525 4 600 400 160 100 125 200 1,585 5 1,500 900 400 200 125 200 3,325 6 2,600 1,500 600 400 125 200 5,425 7 3,500 2,000 800 500 125 200 7,125 8 3,900 2,300 1,000 600 125 200 8,125 9 4,000 2,400 1,000 600 125 200 8,325 yEMEN AIIAII REPUBLIC CENT'RAL HIGHLANDS AGRICULTURhALDEVELOPMIENT PStOJECT Crop Output from Areas to be Developed Under Project
Without Proiect 1984 1985 1986 1987 1988 1989 1990 91 1992 1993 1994 1995 1996 1997 1998
ModelI Sorghum 6,110 6,110 6,120 6,210 6,350 6,760 7,360 8,000 8,480 8,740 8,820 8,840 8,840 8,840 8,840 8,840 Wheat 1,800 1,800 1,800 1,800 1,830 1,900 2,060 2,300 2,530 2,690 2,770 2,800 2,800 2.800 2.800 2,8oo lXize 960 960 960 960 960 970 1,000 1,070 1,180 1,290 1,380 1,420 1,440 1,440 1,440 1,440 Model1 2 Sorgum 2,160 2,160 2,160 2,180 2,250 2,390 2,590 2,800 2,970 3,070 3,110 3,120 3,120 3.120 3,120 3,120 Wheat 650 650 650 650 660 690 740 820 900 960 990 1,000 1,010 1,010 1,010 1,010 lXize 2,020 2,020 2,020 2,030 2,090 2,220 2,410 2,610 2,780 2,890 2,940 2,950 2,950 2,950 2.950 2 950 Vegetables 7,200 7,200 7,200 7,200 7,300 7,650 8,350 9,350 10,400 11,250 11,750 11,950 12,000 12,000 12,000 12,000 Model 3 Wheat 540 540 540 540 570 610 660 720 770 800 81lo 810 810 810 810 810 haize 72U 720 720 730 750 810 880 940 1.010 1,040 1,050 1,050 1,050 1,050 1.050 1,050 Vegetables 2,250 2,250 2,250 2,250 2,280 2,390 2,630 2,920 3,240 -3 540 3,690 3.750 3.750 3.750 3,750 3,750 Potato 1,950 1,950 1,950 1,950 1,980 2,080 2,310 2,570 2,850 3,120 3,240 3,300 3,300 3,300 3.300 3,300 Alfalfa 7,500 7,500 7,500 7,500 7,510 7,600 7,870 8,400 9,100 9,900 10,570 11,020 11,250 11,250 11,250 11,250 lSodel 4 laize 430 430 430 410 360 290 140 70 ------Vegetables 1,350 1,350 1,350 1,370 1,450 1,630 '.i50 2,320 2,700 2,900 3,000 3,000 3,000 3,000 3,000 3,000 Fruit (Citrus) ------3 22 75 190 375 600 830 980 1,060 Coffee 36 36 36 36 36 36 37 42 53 70 95 117 136 147 153 156
Sorghum 35 35 35 20 ------Wiheat 45 45 50 90 120 120 140 140 140 140 140 140 140 140 140 160 1 Maize 360 360 390 560 750 770 790 790 790 790 790 790 790 790 790 790 kn Vegetables 560 560 560 700 1,020 1,340 1,490 1,560 1,560 1,560 1,560 1,560 1,560 1,560 1,560 1,560 1 PRotato 490 490 490 540 840 1,220 1,320 1,380 1,380 1,380 1,380 1,380 1,380 1,380 1,380 1,380 Alfalfa 1,870 1,870 1,870 1,880 1,950 2,140 2,420 2,680 2,810 2,810 2,810 2,810 2,810 2,810 2,810 2,810 Fruit (Grapes) - - - - - 2 17 57 120 195 264 300 300 300 300 300 llodel 6 Sorghum 180 180 ISO 170 160 170 180 180 ISO ISO ISO 180 180 180 ISO ISO Wheat 55 55 60 70 80 100 100 110 110 110 110 110 110 Ito 110 110 Itaize 170 170 190 240 330 370 380 390 390 390 390 390 390 390 390 390 Vegetables 600 600 660 820 1,100 1,310 1,430 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,5W0 Fruit (citrus) - - 8 54 170 360 550 680 720 720 720 720 Coffee ------2 7 Is 20 25 30 30 30 Aggregt o llZdl Srghu- Al odl 8,480 8,480 8,480 8,580 8,760 9,320 10,130 10,980 11,630 11,990 12,110 12,140 12,140 12,140 12,140 12,140 Wheat 3,090 3,090 3,100 3,150 3,260 3,420 3,700 4,090 4,450 4,700 4,820 4,860 4,870 4,870 4,1170 4,870 Maize 4,660 4,660 4,710 4,930 5,240 5,430 5,600 5,870 6,150 6,400 6,550 6,600 6,620 6,620 6,620 6,620 Vegetables 11,960 11,960 12,020 12 340 13 150 14.320 15.850 17,650 19,400 20 750 21 320 21,760 21,810 21,810 21,810 21,810 Potato 2,440 2,440 2,440 2,490 2,820 3,300 3,630 3,950 4.230 4.500 4,520 4,580 4.580 4,580 4,580 4,580 Alfalfa 9,370 9,370 9,370 9,380 9,460 9,740 10,290 11,080 11,910 12,710 13,380 13,830 14,060 14,060 14,060 14,060 F]1 Fruit 93 Citrus - - - - -8 57 192 435 740 1,055 1,320 1,550 1,700 1,780 FI> Grapes - - - - - 2 17 57 120 195 264 300 300 300 300 30 tl Coffee 36 36 36 36 36 36 37 42 .55 77 110 137 161 177 183 189 mD> By-products Sorghum 25,450 25,450 25,450 25,740 26,280 27,960 30,390 32,940 34,890 35,970 36,330 36,420 36,420 36,420 36,420 36,420 Wheat 3,700 3.700 3,700 3,780 3,910 4,100 4,440 4,900 5,340 5,640 5,780 5,83o 5,830 5,830 5,830 5,830 Maize 13,510 13,510 13,660 14,300 15,200 15,750 16,240 17,020 17,830 18,560 19,000 19,140 19,200 19,200 19,200 19,200 Total Incrementol Outp-t Sorghum - - - 100 280 840 1,650 2,500 3,150 3,510 3,630 3,660 3,660 3,660 3,660 Wheat - - 10 60 170 330 610 1,000 1,360 1,610 1,730 1,770 1,780 1,780 1,780 1,780 Ibize _ _ 50 270 580 770 940 1,210 1,490 1,740 1,890 1,940 1,960 1,960 1,960 1,960 Vegetables - - 60 380 1,190 2,360 3,890 5,690 7,440 8,790 9,360 9,800 9,850 9,850 9,850 9,850 Potat. - so5 380 860 1,190 1,510 1,790 2,060 2,080 2,140 2,140 2,140 2,140 2,140 Alfalfa - - - 10 90 370 920 1,710 2,540 3,340 4,010 4,460 4,690 4,690 4,690 4,690 Fruit Citrus ------a 57 192 435 740 1,055 1,550 1,700 1,780 Grapes - - 2 17 57 120 195 264 300 300 300 300 300 Cof fee ------I 6 19 41 74 101 125 141 147 153 By-products Sorghum - 290 830 2,510 4,940 7,490 9,440 10,520 10,880 10,970 10,970 10,970 10,970 10,970 llheat - - - 80 210 400 740 1,200 1,640 1,940 2,080 2,130 2,130 2,130 2,130 2,130 M1aize - - 150 790 1,690 2,240 2,730 3,510 4,320 5,050 5,490 5,630 5,690 5,690 5,690 5,690 -46-
ANNEX 1 Table 10
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Prices of Key Commodities Used for Project Analysis
Item Financial Prices Economic Prices
…------…YRls/ton------
Output Sorghum (yellow) 2,400 1,440 Wheat 2,800 1,750 Maize 2,400 1,460 Vegetables 2,000 2,000 Potatoes 1,500 1,500 Coffee 38,000 23,000 Citrus 4,000 3,000 Grapes 8,000 8,000 Alfalfa 600 600 By-Products: Sorghum 400 400 Wheat 500 500 Maize 500 500
Purchased Inputs
Fertilizers% Urea 1,600 1,600 Triple superphosphate 1,200 1,200
Chemicals; Dimethoate 4,500 4,500 Zineb 3,000 3,000 -47- ANNEX1 Table 11
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Present Cropping Pattern On Total Holding Represented bv Farm Models
Models/Crops Area Rainfed Irrigated Total ______------ha ------
Model I Sorghum 1.7 - 1.7 Wheat 0.5 - 0.5 Maize 0.2 - 0.2 Pulses 0.2 - 0.2 Fallow 0.4 - 0.4 Total 3.0 - 3.0
Model 2 Sorghum 1.0 - 1.0 Wheat 0.3 - 0.3 Maize 0.1 0.3 0.4 Pulses 0.1 - 0.1 Vegetables - 0.2 0.2 Total 1.5 0.5 2.0
Model 3 Sorghum 2.0 - 2.0 Wheat 0.6 0.3 0.9 Maize - 0.3 0.3 Pulses 0.2 - 0.2 Vegetables - 0.3 0.3 Alfalfa - 0.3 0.3 Fallow 1.0 - 1.0 Total 3.8 1.2 5.0 Model 4 Sorghum - 0.8 0.8 Maize - 0.3 0.3 Vegetables - - - Coffee - 0.1 0.1 Double Crop Sorghum - 0.2 0.2 Vegetables - 0.15 0.15
Total - 1.55 1.55
Model 5 Sorghum 2.0 - 2.0 Wheat 0.6 - 0.6 Maize - 1.2 1.2 Pulses 0.2 - 0.2 Vegetables - 0.3 0.3 Potato - 0.3 0.3 Alfalfa - 0.6 0.6 Fruit - - - Fallow 0.8 - 0.8 Double Crop Wheat - 0.2 0.2
Total 3.6 2.6 6.2
Model 6 Sorghum 1.0 - 1.0 Wheat 0.3 - 0.3 Maize 0.1 0.3 0.4 Pulses 0.1 - 0.1 Vegetables - 0.2 0.2 Fruit - - - Coffee - - - Double Crop Wheat - -
Total 1.5 0.5 2.0 -48- ANNEX 1 Table 12
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENTPROJECT
Future Cropping Pattern On Area To Be Developed Under Project
Area Models/Crops Rainfed Irrigated Total -_--- ha------
Model 1 Sorghum 1.7 - 1.7 Wheat 0.5 - 0.5 Maize 0.2 - 0.2 Total 2.4 - 2.4
Model 2 Sorghum 1.0 - 1.0 Wheat 0.3 - 0.3 Maize 0.1 0.3 0.4 Vegetables - 0.2 0.2 Total 1.4 0.5 1.9
Model 3 Sorghum - Wheat - 0.3 0.3 Maize - 0.3 0.3 Pulses Vegetables - 0.3 0.3 Alfalfa - 0.3 0.3 Total - 1.2 1.2 Model 4 Vegetables - 0.1 0.1 Fruit - 0.1 0.1 Coffee - 0.2 0.2 Double Crop Vegetables - 0.1 0.1
Total - 0.5 0.5 Model 5 Maize - 1.8 1.8 Vegetables - 0.5 0.5 Potato - 0.5 0.5 Alfalfa - 0.6 0.6 Fruit - 0.2 0.2 Double Crop Wheat - 0.4 0.4
Total - 4.0 4.0 Model 6 Sorghum 0.7 - 0.7 Wheat - - - Maize 0.1 0.5 0.6 Pulses 0.1 - 0.1 Vegetables - 0.3 0.3 Fruit - 0.1 0.1 Coffee - 0.2 0.2 Double Crop Wheat - 0.2 0.2
Total 0.9 1.3 2.2 -49-
ANNEX 1 Table 13
YEKEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRI<,UAJTIRALDEVELOPMELJT PROJECT
Annual Income and Operating Expenses for Model 1
Without With Project (Year) Project 1 2 3 4 Value of Production ------(YRls)------
Sorghum Grain 3,670 4,490 4,900 5,300 5,300 Stover 1,630 2,000 2,160 2,310 2,310 Other 420 420 260 260 260 Wheat Grain 1,260 1,260 1,680 1,820 1,960 Straw 280 280 360 400 430 Maize Grain 580 580 720 790 860 Stover 360 360 420 460 500 Other 50 50 40 30 30 Pulses Grain 500 500 500 500 500 Stalks 70 70 70 70 70
TOTAL 8,820 10,010 11,110 11,940 12,220
Cost of Production
Seeds 340 340 360 360 360 Manure 10 10 10 10 10 Fertilizer 80 300 490 570 570 Chemicals - - 180 260 260 Tractor Hire 1,090 1,090 1,090 1,090 1,090 Animal Hire 3,800 4,090 4,390 4,400 4,560 Sundry 290 330 360 380 380 Zakat (tax) 600 680 780 840 860 Hired Labor 760 840 960 1,020 1,040
TOTAL 6,970 7,680 8,620 8,930 9,130
Net Benefit
Per Household 1,850 2,330 2,490 3,010 3,090 Per Family Workday 16 19 20 23 24 -50- ANNEX 1 Table 14
YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT Annual Income and Operating Expenses for Model 2
Without With Project (Year) Project 1 2 3 4 Value of Production ------(YRs)…------
Sorghum Grain 2,160 2,640 2,880 3,120 3,120 Stover 960 1,160 1,280 1,360 1,360 Other 250 250 150 150 150 Wheat Grain 760 760 1,010 1,090 1,180 Straw 160 160 220 240 250 Maize Grain 2,020 2,450 2,740 2,920 2,950 Stover 1,260 1,480 1,560 1,680 1,690 Other 100 90 70 60 60 Pulses Grain 250 250 250 250 250 Stalks 40 40 40 40 40 Vegetables 6,000 6,000 8,000 9,000 10,000
TOTAL 13,960 15,280 18,200 19,910 21,050
Cost of Production
Seeds 400 400 410 410 410 Manure 70 70 70 70 70 Fertilizer 120 360 600 700 700 Chemicals 90 130 370 410 410 Tractor Hire 840 840 840 840 840 Animal Hire 3,670 3,980 4,350 4,440 4,450 Packages 370 370 490 550 620 Water 1,260 1,240 1,190 1,160 1,160 Zakat (tax) 740 800 970 1,060 1,130 Hired Labor 880 960 1,020 1,080 1,110 Sundry 420 460 520 540 550
TOTAL 8,860 9,610 10,830 11,260 11,450
Net Benefit
Per Household 5,100 5,670 7,370 8,650 9,600 Per Family Workday 37 40 49 57 62 -51-
ANNEX 1 Table 15
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Annual Income and Operating Expenses for Model 3
Without With Project (Year) Project 1 2 3 4 5 Value of Production ------(YRls)------
Sorghum Grain 2,400 2,400 2,400 2,400 2,400 2,400 Stover 800 800 800 800 800 800 Other 150 150 150 150 150 150 Barley Grain 1,060 1,060 1,060 1,060 1,060 1,060 Straw 290 290 290 290 290 290 Pulses Grain 430 430 430 430 430 430 Stover 60 60 60 60 60 60 Wheat Grain 1,510 1,930 2,100 2,270 2,270 2,270 Straw 330 420 450 480 480 480 Maize Grain 1,730 2,160 2,380 2,520 2,520 2,520 Stover 1,080 1,300 1,350 1,440 1,440 1,440 Other 80 70 50 50 50 50 Vegetables 4,500 4,500 6,000 6,760 7,500 7,500 Potatoes 2,930 2,930 4,050 4,500 4,950 4,950 Alfalfa 4,500 4,500 4,725 5,400 6,075 6,750
TOTAL 21,850 23,000 26,295 28,610 30,475 31,150
Cost of Production
Seeds 1,450 1,460 1,470 1,480 1,480 1,480 Manure 100 100 100 100 100 100 Fertilizer 140 360 600 660 720 740 Chemicals 70 70 150 210 210 210 Tractor Hire 840 840 840 840 840 840 Animal Hire 5,360 5,660 5,850 6,050 6,050 6,050 Water 4,000 3,910 3,790 3,710 3,660 3,500 Zakat (tax) 920 970 1,120 1,190 1,250 1,250 Hired Labor 1,400 1,480 1,530 1,530 1,530 1,530 Sundry 710 740 770 790 790 790
TOTAL 14,990 15,590 16,220 16,560 16,630 16,490
Net Benefit
Per Household 6,860 7,410 10,075 12,050 13,845 14,660 Per Family Workday 33 34 45 53 61 64 YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Annual Income and Operating Expenses for Model 4
Without With Project (Year) Project 1 2 3 4 5 6 7 8 9 Value of Production ------(YRls)------
Sorghum Grain 5,760 5,760 5,760 5,760 5,760 5,760 5,760 5,760 5,760 5,760 Stover 2,880 2,880 2,880 2,880 2,880 2,880 2,880 2,880 2,880 2,880 Other 250 250 250 250 250 250 250 250 250 250 Maize Grain 1,730 860 ------Stover 1,080 540 ------Other 80 40 ------Vegetables 4,500 6,000 8,000 9,000 10,000 10,000 10,000 10,000 10,000 10,000 Beans (intercrop) - 800 1,840 1,280 800 - - - - - Fruit (citrus) - - - - - 400 2,000 4,000 6,400 7,200 Coffee u- Existing plantations 2,280 2,280 2,280 2,280 3,800 4,560 4,560 4,560 4,560 4,560 New plantations - - - - - 2,280 3,040 4,180 5,320 5,320 Banana (shade crop) _ _ 100 200 400 400 400 400
TOTAL 18,560 19,410 21,010 21,450 23,590 26,330 28,890 32,030 35,570 36,370 Cost of Production
Seeds and Seedlings 220 230 280 280 260 240 240 240 240 240 Manure 60 50 40 40 60 80 80 80 80 80 Fertilizer 100 160 200 230 320 440 460 460 460 460 Chemicals 60 70 90 120 150 150 150 150 150 150 Tractor Hire 610 550 500 500 500 500 500 500 500 500 Knapsack Use 10 20 20 20 30 30 30 30 30 Animal Hire 5,070 4,920 4,780 4,780 5,030 5,270 5,350 5,400 5,400 5,400 Water 1,300 1,300 780 680 1,030 1,250 1,250 1,250 1,250 1,250 Packages 190 260 340 380 420 450 480 520 530 530 Zakat (tax) 710 780 890 920 1,020 1,160 1,290 1,440 1,620 1,660 Hired Labor 870 790 830 830 860 900 910 910 910 910 Sundry 460 460 440 460 480 520 540 550 560 560
TOTAL 9,650 9,580 9,190 9,240 10,150 10,990 11,280 11,530 11,730 11,770 Net Benefit
Per Household 8,910 9,830 11,820 12,210 13,440 15,340 17,610 20,500 23,840 24,600 Per Family Workday 64 61 62 62 73 84 97 113 131 135 YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURALDEVELOPMENT PROJECT
Annual Income and Operating Expenses for Model 5 I/
Without With Project (Year) Project 1 2 3 4 5 6 7 8 Value of Production ------= ------(YRls ------
Sorghum Grain 2,400 1,680 1,680 1,680 1,680 1,680 1,680 1,680 1,680 Stover 800 560 560 560 560 560 560 560 560 Other 150 100 100 100 100 100 100 100 100 Barley Grain 1,060 1,060 1,060 1,060 1,060 1,060 1,060 1,060 1,060 Straw 290 290 290 290 290 290 290 290 290 Pulses Grain 430 430 430 430 430 430 430 430 430 Straw 60 60 60 60 60 60 60 60 60 Maize Grain 6,910 14,400 14,260 15,120 15,120 15,120 15,120 15,120 15,120 Stover 4,320 8,800 9,100 9,600 8,640 8,640 8,640 8,640 8,640 Other 300 500 270 270 270 270 270 270 270 Alfalfa 9,000 9,000 9,450 10,800 12,150 13,500 13,500 13,500 13,500 Potato 5,850 5,850 13,800 15,150 16,500 16,500 16,500 16,500 16,500 1 Wheat Grain 1,010 3,220 2,100 3,020 3,020 3,020 3,020 3,020 3,020 w Straw 220 680 440 640 640 640 640 640 60(' I Vegetables 9,000 12,000 20,000 22,500 25,000 25,000 25,000 25,000 25,0uL Fruit (grapes) - - - - 1,600 4,800 9,600 14,400 19,200
TOTAL 41,800 58,630 73,600 81,280 87,120 91,670 96,470 101,270 106,070
Cost of Production
Seeds and Seedlings 2,120 2,435 3,285 3,475 3,480 3,480 3,480 3,480 3,46- Manure 260 360 400 400 400 400 400 400 400 Fertilizer 270 1,420 1,670 2,080 2,450 2,650 2,650 2,650 2,650 Chemicals 150 260 760 780 780 970 970 970 970 Tractor Hire 2,080 2,210 2,290 2,330 2,330 2,330 2,330 2,330 2,330 1 Animal Hire 12,530 13,180 13,790 14,130 14,130 14,730 14,730 14,730 14,730 a Protection net ------1,370 1,370 m x Packaging 440 560 990 1,080 1,280 1,345 1,445 1,545 1,645 M Water 8,540 22,790 19,180 19,350 16,260 17,860 17,860 17,860 17,860 Zakat (tax) 1,530 2,160 2,900 3,180 3,260 3,420 3,660 3,900 4,140 Hired Labor 2,260 3,170 3,720 3,770 3,780 3,800 3,810 3,820 3,820 Sundry 1,510 2,430 2,450 2,530 2,410 2,550 2,570 2,650 2,670
TOTAL 31,690 50,975 51,435 53,105 50,560 53,535 53,905 55,705 56,065
Net Benefit
Per Farm Model 10,110 7,655 22,165 28,175 36,560 38,135 42,565 45,565 50,005 Per Family Workday 31 17 50 62 75 78 88 91 100
1/ Irrigation networks to serve more than one family. YEMEN ARAB REPUBLIC CENTRAL HIGHLANDSAGRICULTURAL DEVELOPMENTPROJECT
Annual Income and Operating Expenses for Model 6
Without With Project (Year) Project 1 2 3 4 5 6 7 8 9 Value of Production …………------…(YRls)------
Sorghum Grain 2,160 1,840 2,020 2,180 2,180 2,180 2,180 2,180 2,180 2,180 Stover 960 580 700 770 820 820 820 820 820 820 Other 250 150 90 90 90 90 90 90 90 90 Wheat Grain 760 1,010 1,290 1,400 1,510 1,510 1,510 1,510 1,510 1,510 Straw 160 220 280 300 320 320 320 320 320 320 Maize Grain 2,020 3,310 4,320 4,600 4,630 4,630 4,630 4,630 4,630 4,630 Stover 1,260 2,100 2,500 2,640 2,650 2,650 2,650 2,650 2,650 2,650 Other 100 90 70 50 50 50 50 50 50 50 Pulses Grain 250 250 250 250 250 250 250 250 250 250 Straw 40 40 40 40 40 40 40 40 40 40 Vegetables 6,000 9,000 12,000 13,500 15,000 15,000 15,000 15,000 15,000 15,000 Coffee ------1,180 3,040 4,180 5,320 Banana (shade) - - - - 100 200 400 400 400 400 Beans (inter-crop) - 1,600 2,480 1,800 800 - - - - - Fruit (citrus) - - - - 400 2,000 4,000 6,400 7L2 0 0
TOTAL 13,960 20,190 26,040 27,620 28,440 28,140 31,120 34,980 38,520 40,460
Cost of Production
Seeds and Seedlings 400 490 530 530 490 470 470 470 470 470 Manure 70 100 110 110 150 170 170 170 170 170 Fertilizer 120 700 880 880 970 1,090 1,110 1,110 1,110 1,110 Chemicals 60 70 90 120 150 150 150 150 150 150 Tractor Hire 840 760 800 800 800 800 800 800 800 800 Animal Hire 3,670 4,545 4,730 5,330 5,620 5,780 5,800 5,820 5,820 5,820 Knapsack Use - - 30 40 50 70 70 70 70 70 a x Packaging 370 550 740 830 930 960 990 1,000 1,000 1,000 Shade Replacement - - - - - 1,000 1,000 1,000 1,000 1,000 x Water 1,060 1,770 1,590 1,500 2,580 2,900 2,900 2,900 2,900 2,900 Zakat (tax) 740 1,150 1,250 1,320 1,360 1,450 1,550 1,790 1,860 1,860 Hired Labor 860 1,140 1,240 1,320 1,350 1,380 1,400 1,400 1,400 1,400 Sundry 410 575 610 650 730 820 830 850 850 850
TO TAL 8,600 11,850 12,600 13,430 15,180 17,040 17,240 17,530 17,600 17,600
Net Benefit
Per Household 5,360 8,340 13,440 14,190 13,260 11,100 13,880 17,450 20,920 22,860 Per Family Workday 39 53 76 80 70 58 78 90 108 118 YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Field Crop Inputs, Farm Traction, and Labor Requirements Per Hectare at Present
Rainfed Areas Irrigated Areas Alfalfa Alfalfa ltems Units Sorghum Wheat Maize Sorghum Wheat Maize Potatoes Vegetables 1st yr. 2&3 yr.
Seeds kg 25 130 30 25 140 30 1,750 0.5 30 -
Fertilizer -N kg 10 15 15 15 20 20 60 60 - -
-P205 kg ------30 30 - - K20 kg ------_ -Manure kg - - 200 - - 500 1,000 1,000 600 -
Chemicals -Seed Treatment kg ai ------
-Fungicide kg ai - - - - - 1.2 0.6 - - -Insecticide kg ai - - _- - 1.8 - - -Weedicide kg ai - - - 1.0 1.0 1.0 - - - -
Cultivation -Tractor hours 7 7 7 7 7 7 7 7 7 - -Animal Hire days 10 9 12 15 11 15 22 27 16 8 -Knapsack Use days ------1 1 - -
Labor -Hired mandays 5 4 7 8 6 9 14 23 11 7 -Family mandays 30 22 29 45 35 44 83 159 66 135
Water -(at source) m3 - - - 13,540 12,620 12,820 11,600 14,000 20,800 31,140
Packing/Bags Pcs. ------41 250 - - YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Field Crop Inputs, Farm Traction, and Labor Requirements per Hectare with Project
Rainfed Areas Irrigated Areas Alfalfa Alfalfa Items Units Sorghum Wheat Maize Sorghum Wheat Maize Potatoes Vegetables 1st yr. 2&3 yr.
Seeds kg 25 130 30 25 140 30 2,000 0.5 20
Fertilizer
-N kg 50 70 60 80 120 120 120 120 - - -P2 05 kg 20 40 20 40 80 80 120 120 120 120 -K20 kg ------60 60 - - -Manure kg - - 200 - - 500 1,000 1,000 600 -
Chemicals -Seed Dressing /1 kg ai 0.04 0.2 0.05 0.04 0.2 0.05 - - -Fungicide /2 kg ai ------1.8 0.9 - - -Insecticide /3 kg ai 0.4 0.4 0.4 0.4 0.4 0.4 1.2 1.8 - - -Weedicide kg ai - - - 1.0 1.0 1.0 - - - -
Cultivation -Tractor hour 7 7 7 7 7 7 7 7 7 - -Animal Hire day 12 10 14 19 15 20 26 29 19 11 -Knapsack Use day 2 2 2 2 2 2 3 5 - - Labor -Hired mandays 7 6 8 11 8 11 19 26 7 17 -Family mandays 34 33 38 52 42 55 102 182 72 165
Water M 3 -(at source) m - - - 12,500 11,600 11,800 10,700 12,800 19,100 28,700 o
Packages/Bags No.Pcs. -- - - 78 420 - -
/1 Seed dressing carboxine 0.15 kg ai per 100 kg of seed. /2 Lime sulphur or maneb. /3 Malathion or pyrethonol using 0.4 kg ai per ha. YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Crop Production Cost at Present
Seeds Manure Fertilizer Chemicals Tractor Hire Animal Hire Water /1 Zakat /1 Hired Labor Sundry Total /2 ------… ------(YRls/ha) ------
Rainfed Crops Sorghum 65 - 30 - 420 1,500 _ 215 300 125 2,655 Wheat 390 - 45 - 420 1,350 - 250 240 135 2,830 Maize 70 40 45 - 420 1,800 - 290 280 145 3,090
Irrigated Crops Sorghum 65 - 45 - 420 2,250 2,700 290 480 310 6,560 Wheat 420 60 - 420 1,650 2,520 225 360 280 5,935 Maize 70 100 60 - 420 2,250 2,560 290 540 315 6,605 Potatoes 4,025 200 270 20 420 3,320 2,320 1,300 840 640 13,355 Vegetables 900 200 270 430 420 4,050 2,800 1,500 1,380 600 12,550 Alfalfa Establishment 900 120 270 - 420 2,400 4,160 - 660 450 9,380 Alfalfa Annual - - - - - 1,050 6,230 - 420 385 8,085
/1 These have been excluded while computing the economic rate of return. /2 Excluding family labor. YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Crop Production Cost With Project
Seeds Manure Fertilizer Chemicals Tractor Hire Animal Hire Water /1 Zakat /I Hired Labor Sundry Total /2 ------…------…------(YRIs/ha) ------…------Rainfed Crops Sorghum 65 - 210 105 420 1,825 Wheat - 310 420 170 3,525 415 - 330 120 420 1,525 - 390 360 180 3,740 Maize 80 40 240 105 420 2,125 - 430 480 200 4,140 Irrigated Crops Sorghum 55 - 360 130 420 2,875 2,375 360 660 360 7,595 Wheat 450 600 145 420 2,275 2,205 380 480 350 . 7,305 Maize 80 100 600 130 420 3,025 2,240 420 660 385 Potatoes 4,600 200 8,060 1 915 335 420 3,940 2,035 1,650 Vegetables 1,140 760 15,995 T 900 200 915 475 420 4,950 Alfalfa 2,430 2,500 1,560 720 15,070 Establishment 600 120 360 - 420 2,850 3,630 - 420 420 8,820 Alfalfa Annual - - 360 - - 1,650 5,455 - 1,020 425 8,910
/1 These have been excluded while computing the economic rate of return. 72 Excluding family labor.
43> -59- ANNEX 1 Table 23 YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Operation & Maintenance Cost of Citrus with Project /1
Years of Development Item Unit Quantity Unit Cost 1 2 3 4 5 6 7-30 ------YRls/ha ------Seeds (intercroppedbeans) kg 20 10 200 200 200 - - - - Manure kg 1,000 0.2 - - - 200 200 200 200 Fertilizer kg 310 various - - - 950 950 950 950 Chemicals kg 125 " - - - 220 220 220 220 Irrigation water m 20,000 0.2 - - - 4,000 4,000 4,000 4,000 Spray equipment use days 8 12 - - - 100 100 100 100 Packages no. 225 5 - - 60 310 630 1,000 1,130 Zakat (tax) . 5 600 480 600 1,000 2,000 3,200 3,600 Animal use days 17 150 600 600 750 2,250 2,400 2,550 2,550 Labor (hired) man days 100 100 120 360 380 400 400 Sundry (cash costs) 5 80 70 90 470 540 640 660 TOTAL 1,580 1,450 1,820 9,860 11,420 13,260 13,810
/1 Excluding family labor, whose requirements are estimated as follows:
Years of Development Item 1 2 3 4 5 6 7-30 ------mandays ------heavy work 8 8 10 81 86 90 90 light work 20 20 24 92 112 132 152 TOTAL 28 28 34 173 198 222 242
Costs during the first three years apply to the intercrop. -60- ANNEX 1 Table 24
YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT
Operation and Maintenance Cost of Vineyard with Project /2
Years of Development Item Unit Quantity Unit Cost 1 2 3 4 5 6 7-30 … ------(YR1s/ha)…------Fertilizer kg 500 - - - 980 980 980 980 Chemicals kg 6 120 - - - 720 720 720 720 Protection nets x 33 20,800 - - - - - 6,860 6,860 Spray/dusting equipment days 45 12 - - - 540 540 540 540 Irrigation water m3 12,000 0.2 - - - 2,400 2,400 2,400 2,400 Packages no. 400 15 - - 170 500 1,000 1,500 2,000 Zakal (Tax) x 5 - 400 1,200 2,400 3,600 4,800 Animal Use days 22 150 - - 150 3,000 3,150 3,300 3,300 Labor (hired) mandays 9 60 - - 20 480 500 540 540 Sundry (cash costs) - - - - - 40 490 580 1,020 1,100 TOTAL 780 10,310 12,270 21,460 23,240
/1 Excluding family labor, whose requirements are estimated as follows:
Years of Development Item 1 2 3 4 5 6 7-30 ------TmandaysF~------heavy work - - 1 83 87 91 91 light work - - 27 95 113 131 150 TOTAL - - 28 178 200 222 241 -61- ANNEX 1 Table 25 YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT Operation and Maintenance Cost of Coffee Trees with Project /1
Years of Development Item Unit Quantity Unit Cost 1 2 3 4 5 6 7-30 - - - -(YRls/haT-- Seeds (intercrop) kg 20 10 200 200 200 - - - - Manure kg 1,000 0.2 - - - 200 200 200 200
Fertilizers kg 220 various - - - 450 580 680 680 Chemicals kg 5.5 various - - - 240 240 240 240 Irrigation Water mi 9,000 0.2 - - - 1,800 1,800 1,800 1,800 1,800 Spray equipment use days 8 12 - - - 60 80 100 100 Shade replacement pa 1,000 1,000 1,000 Packages no. 5 10 20 30 30 Zakat (tax) X 6 5 400 320 210 1,140 1,720 2,290 2,860 Animal use days 14 150 600 600 750 1,950 2,000 2,050 2,100 Labor (hired) man days 6 60 100 100 120 240 300 360 360 Sundry (Cash Costs) 70 60 60 300 400 440 470 TOTAL 1,370 1,280 3,340 6,390 8,340 9,190 9,840
Excluding family labor, whose requirements are estimated as followsz
Years of Development Item 1 2 3 4 5 6 7-30
------:[mandaysF :~- -~~~ heavy work 8 8 9 54 56 59 60 light work 18 18 24 90 107 127 140 TOTAL 26 26 33 144 163 186 200
Costs during the first three years apply to the intercrop. -62- ANNEX I Table Z YEMEN ARAB REPUBLIC CENTRAL HIGHLANDS RURAL DEVELOPMENTPROJECT Economic Cost and Quantifiable Benefit Streams
Incremental Cost Incremental Investment Cost Operating Cost /2 Benefit Water Ag. Year Ag.Dev./l Supply .Dev. ------(YRls million) ------
1984 1.5 5.6 1985 7.7 2.5 0.2 0.3 1986 11.9 5.0 1.2 2.0 1987 12.8 5.0 3.7 5.8 1988 8.3 6.1 5.5 11.5 1989 - - 12.7 18.8 1990 - - 16.4 27.9 1991 - - 19.8 37.0 1992 - - 21.2 44.6 1993 - - 21.5 49.4 1994 - - 21.9 52.9 1995 - - 21.9 55.2 1996 - - 22.1 56.5 1997 - - 21.8 56.5 1998 - - 21.4 56.5 1999 - - 21.4 56.5 2000 - - 22.1 56.5 2001 - - 22.1 56.5 2002 - - 21.8 56.5 2003 - - 21.5 56.5 2004 - - 21.4 56.5 2005 - - 22.0 56.5 2006 - - 22.2 56.5 2007 - - 21.8 56.5 2008 - - 21.4 56.5 2009 - - 21.5 56.5 2010 - - 22.0 56.5 2011 - - 22.1 56.5 2012 - - 21.8 56.5 2013 - - 21.4 56.5
/1 Includes Project Administration and extension development.
/2 Includes incremental annual cost of production, and replacement cost and recurrent cost of project administration and extension. -63-
ANNEX 2
YEMEN ARAB REPUBLIC
CENTRAL HIGHLANDSAGRICULTURAL DEVELOPMENT PROJECT
Selected Documents and Data Available in the Project File
A. Reports Relating to the Project
A-1 FAO/CP. Central Highlands Rural Development Project Preparation Report (includingTOR for Studies of Phase II), February 15, 1983.
A-2 Ministry of Overseas Development (UK). Agricultural Development on the Montane Plains (vols 1-2), 1978.
A-3 YAR/MAF. Summary of the Final Results of the Agricultural Census in Eleven Provinces, April 1983.
B. Working Documents
B. Selected Working Documents. YEMENARAB REPUBLIC CENTRALHIGHLANDS AGRICULTURAL DEVELOPMENT PROJECT Organigrom of Implementing Agencies
Mlnisterof Agriculture
Accounts, Finance, PersonnelManagemnent, Studies,Training
. ~~~~~~Manager Planning, Statistics & Evalucitbn
Engineering Serices
rDeputyProject Manager eor Manager for Dhamor Govemorate Sanaa Govemnorarte
BlockCenters BlockCenters
ExtensionCenters ExtensionCenters
Beneflciaries
Wodd Bank - 25171 IBRD 17321
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A I H A D A DISTRICT BOUNDARIES l/4:;¢8:I _ . tPROVINCIALBOUNDARIES
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