8an'k The World UsEONrLY iOR OPpjuL
Public Disclosure Authorized 10968 RepottN0
REpoR CT02PLETIV PROJ_CT
OF TUNISIA REPUBLIC Public Disclosure Authorized
pR~OJECT 2865-CRUD)CREDIAT FOJRI ACRICUTUL- (LOAN
1992 JULtY28,
Public Disclosure Authorized COPY MICROFICHE Cov.F Type(PCR)PROJECT No: 10968 CREDIT Report AGRICULTURAL FOURTH T90oEq/ OEDD1 / MAA E.B./ X31755 E;y: RICE, : 19920724 Date Ent.
peratOn Dvtlo
Public Disclosure Authorized Agriculture t I L~icaRgin Norh Af outrYdDePRartmenMlddeEat an douent eWtddsduinadmIVb-~~~~fii1d CURRENCYEQUIVALENTS
CurrencyUnit = Tunisian Dinar (TD)
At Appraisal(Nov./Dec. 1986) US$1 = TD 0.87fTDI = US$1.15 ImplementationAverage (19&8-1991) US$1 = TD 0.88/TD1 = US$1.14
GLOSSARYOF ABBREVIATIONS
ASAL - Pret6 I'Ajustementdu secteuragricole (Agricultural Sector Adjustment Loan) BCT - Banquecentrale de Tunisie(Central Bank of Tunisia) BNA - Banquenationale agricole (NationalBank of Agriculture) BNDA - Banquenationale de d6veloppementagricole (National Bank for AgriculturalDevelopment) BNT - Banquenationale de Tunisie (NationalBank of Tunisia) CSA - Cooperativede service agricole (ServiceCooperative) EEC/EIB - Communaut66conomique europeenne/Banque europdenne d'investissement(European Economic Community/EuropeanInvestment Bank) FIDA/IFAD- Fonds internationalde ddveloppementagricole (International Fund for Agricultural Development) FNG - Fonds nationalde garantie(National Guarantee Fund) FOSDA - Fonds spdcialde d6veloppementagricole (Special Fund for AgriculturalDevelopment) FOSEP - Fonds speciald'encouragement de la p6che(Special Fund for FisheriesDevelopment) MOA - Ministarede l'agriculture(Ministry of Agriculture) MOF - Ministbredes finances (Ministryof Finance) MOPDR - Minist6redu plan et du d6veloppementr6gional (Ministry of Planningand Regional Development) OMV - Office de mise en valeur (IrrigationDevelopment Agency) ONP - Office nationaldes peches(National Fisheries Agency) SCMA - Soci!td de caution mutuelleagricole (AgriculturalMutual Guarantee Society)
WEIGHTSAND MEASURES
Metric System
FISCALYEAR OF BORROWER
January 1 - December31 FOROFFKXAL USE ONLY THE WORLD BANK Wasnghh D.CQ2o433 U.SA Office of Director-General Operations Evaluation
July 28, 1992
MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT
SUBJECT: Project CompletionReport on TUNISIA - Fourth Agricultural Credit Proiect (Loan 2865-TUN)
Attached, for information,is a copy of "Project a report entitled Completion Report on Tunisia: Fourth Agricultural Project (Loan Credit 2865-TUN)" prepared by the Middle East Africa and North Regional Office. No audit of this project the has been made by Operations EvaluationDepartment at this time.
Attachment
Tbb document I ha * restreited dbsdb*uton ad may be and by rtdpanb on I. | the perfenmum of teir Om dulle&Its contets may not otberw be disoused without World Bak authorUen. | FOR OMFCL USE ONLY PROJECT COMPLETION REPORT
REPUBLIC OF TUNISIt
FOURTH AGRICULTURAL CREDIT PROJECT (LOAN 2865-TUN)
TABLE OF CONTENTS
Paae No.
Preface S ...... i Evaluation Summary l
PART I PROJECT REVIEW FROM BANK'S PERSPECTIVE ...... 1 1 Project Identity ...... 1 2. Project Background ...... 1 3. Project Objectives and Description ...... 2 4. Project Design and Organization ...... 3 Design . . &* 3 Preparation, Appraisal and Negotiations ...... 4 5. Project Implementation ...... 5 Loan Effectiveness and Project Start-Up ...... 5 Project Risks ...... 5 Implementation ...... 5 On-Lending Component ...... 5 Institutional Component ...... 6 Project Costs and Disbursements ...... 7 6. Project Results ...... 7 Progress on Agricultural Credit Policy and Institutional Reforms ...... 8 Financial Performance o ...... 10 Loan Recovery . o ...... o ...... 11 7. Project Sustainability ...... 11 8. Const.lting Services ...... o o . . . . o . 12 9. Project Documentation and Data o ...... 12 10. Bank Performance . . o ...... 12 11. Borrower and Guarantor's Performance . o o . . . a . 12 12. Project Relationship . . . . o o . . . a . . . o . . 13 13. Lessons Learned...... 13
PART II PROJECT REVIEW FROM BORROWER'S PERSPECTIVE ...... 15 1. Overview of the Project o 6...... 16 2. Project Development and Implementation ...... 17 3. World Bank Performance during the Project ...... 25 4* Conclusion . . . . . o. . o . o...... a 27
This document has a restricted distribution and may be used by recipients only in the perfor'mance of their offcial duties. Its contents may not otherwise be disclosed without World Bank authorization. Paae No.
ANNEXES: I. Project Cost ...... 28 II. Lending by Year ...... 29 III. Disbursement by Year ...... 30 Disbursement by Category .o. . . * ...... o. 30 IV. BRA Training Budget . . . . . a ...... * . . . . 31 V. Agricultural Credit Recovery ...... 32 VI. Recovery Rates by Year ...... 33
PART III STATISTICAL INFORMATION (tables) ...... 34 1. Related Bank Loans and/or Credits ...... 34 2. Project Timetable ...... 34 3. Loan Disbursements: Cumulative Estimated and Actual Disbursements . . . . 35 3(a)o Comparison between Appraisal and Actual Disbursements by Category of Disbursements ...... 36 3(b). BRA's Project Related Subloans Commitments ...... 37 BNA's Project Related Subloans Disbursements . . . . . 37 3(c). BNA's Project Related Subloans at Year-end and Cumulative ...... a ...... 38 3(d). Project Lending Program: Medium- and Long-Term Credit ...... 38 4(a). Project Implementation- Key Performance Indicators: BNA's Loan Recovery 1987-91 for Agricultural Lending and Risk Assumed ...... 39 4(b). Financial Ratios ...... 39 5(a). Project Costs and Financing ...... 40 5(b). Project Financing ...... 40 6. Status of Covenants ...... 41 7(a). Use of Bank Resources: A. Staff Inputs ...... 42 7(b). Use of Bank Resources: B. Missions ...... 43 8(a). BRA's Financial Position, Summary of Balance Sheet 1987-1991 as of December 31 ...... 44 8(b). BRA's Financial Position, Income Statements, 1987-1991 as of December 31 ...... 45
Map IBRD 149211 PROJECT COMPLETIONREPORT
REPUBLIC OF TUNISIA
FOURTHAGRICULTURAL CREDIT PROJECT (LOAN 2865-TUN)
PREFACE
This is the Project Completion Report for the Fourth Agricultural Credit Project (Loan 2865-TUN) for which a loan equivalent to US$30 million to the National Bank of Tunisia-/(BNT, the Borrower) with the guarantee of the Republic of Tunisia, was approved on July 7, 1987. The legal documents were signed on July 22, 1987 and the loan became effective on January 22, 1988. The original closing date was December 31, 1991. The loan was fully disbursed and closed on November 19, 1991, six weeks ahead of schedule.
The Project CompletionReport was jointly prepared by the Agricultural OperationsDivision for the Maghreb of the Middle East and North Africa Regional Office (Preface,Evaluation Summary, Parts I and III) and the Borrower (Part II).
Preparationof this PCR was started followinga mission to Tunisia in February 1992. Parts I and III were prepared on the basis of information available in the Division's and the Bank's central files. The main sources of informationwere: the appraisalreport No. 6622-TUN, dated June 1, 1987; the Loan Agreement;supervision reports; correspondence between the Bank and the borrower; internal Bank memoranda;and consultationwith implementationofficials and staff during the completion mlssion. This report was also based on the borrower's Project Completion Report dated February 20, 1992 (Part II).
In October 1989, BNT (Bauquenationale de Tunslie - the borrower),which Is a majorcommercal bank, merged with BNDA (Banque nationale de ddveloppement agricole - a development bank with no branch network,which benefittedfrom the support of the EEC and EIB) and became Banque nationale agricole (BRA). In this text, BNT and BNA.are used interchangeably, referring to BUT before merger in 1989 and BRA after the merger. - iii -
PROJECT COMPLETIONREPORT
REPUBLIC OF TUNISIA
FOURTHAGRICULTURAL CREDIT PROJECT (LOAN 2865-TUN)
EVALUATIONSUMMARY
Obiectives
1. The main objectives of the Fourth Agricultural Credit Project in Tunisia were to promote development of a financially sound rural credit system and to finance credit to the agriculturesector in response to market demand and in support of the Government's medium-term adjustment program (1987-1991) formulated in connection with the Agricultural Sector Adjustment Loan (ASAL - Loan 2754-TUN). The Project aimed to: (a) encourage the Banque nationale de Tunisie (BNT) and the banking sector to increase their roles in mobilizing resourcesand in financingagricultural activities by addressingsectoral issues such as on-lendinginterest rates; (b) restructurethe complex institutionaland credit systems; (c) improve the financial viability of agricultural credit operations and harmonize credit terms and conditions; (d) assist Government and BNT in their efforts to develop private investmentin the sector; and (e) promote savings schemes tied to eligibility for credit (3.01). lmglementation Experience
2. During implementation,good progress was made on both BRA's (BNT: see Preface, footnote -1)credit program and the policy and institutionalreforms to which the Government and BRA had agreed. The project started off well with the creation of the agricultural credit reform committee immediately after loan effectiveness,and the loan was fully disbursedon a timely basis. The loan was closed on November 19, 1991, six weeks ahead of the original closing date (paras. 5.01 and 5.03).
3. Except for a reduced pace of lending in 1988 and 1989 due to two consecutive droughts, BNA's lending to farmers was on appraisal targets throughoutthe life of the project, and the number of small-scalefarmers reached exceeded appraisal estimates by 76 percent (increased demand for small loans after the drought, and reduced Government funding from other programs). For cooperativesand agro-industriesthe disbursementsremained on target throughout the project's duration, and for fisheries,demand exceeded appraisal estimates (para. 5.04). - iv -
4. The implementationof the institutionalcomponent was difficultdue to the political sensitivity attached to agricultural credit interest rates in Tunisia, the complexity of existing credit systems, the merging of BNT/BNDA in October 1989, and the negative impact of drought on loan recoveries. At the'time of the merger, BNA was faced with three important tasks: reorganizationof the new bank on a decentralizedbasisl/ to reach more efficiently a large numbbr of farmers and rural clients, integration and harmonizationof the activitie,and accounts of the two banks, and preparation of a new lending program for the future. A major step was taken in July 1990 when an agreement was reached between the Government, BRA, and internationaldonors on the responsibilityof the banking sector (and not the Government) for granting credit to farmers and managing risk. This resulted in a gradual shift in the decision-makingprocess for Government-supportedagricultural credit for small-scale farmers froimthe Ministry of Agriculture (MOA) to BRA, which in turn opened the door to a complete restructuringand reorganizationof the merged bank. However, this consolidation work is far from completed. The merger itself is not sufficient to permit the new BNA to fully assume, in an accountablemanner (i.e., free from Government intervention), its lead role as the rural bank in a gradually liberalized financial sector (paras. 5.05 and 5.06).
5. Training activitiesprogressed well during project implementationbut need to be actively pursued in the future and to be conceptuallysharpened, using a long-term global approach and a strategic plan. Improvements in the computerizationof BHA activities and its management information system (MIS) startedwell and made overall good progress. With the current reorganizationof BNA, these will need further improvements(para. 5.07).
Results
6. The overall results of the Project, in terms of achieving its main policy reforms and investment objectives, :e satisfactory, particularly if compared to the previous three credit operationsin Tunisia. Still, some of the reform objectives, for example, greater fungibility of funds, including harmonization of terms and conditions, recovery performance, and BRA reorganization have not been fully achieved during the short implementation period. Physical targets envisaged at appraisal were largely achieved:namely, disbursement for on-lending, the installation of computer facilities at headquartersand in regional offices and branch networks,a computerizedMIS with an improved accountingsystem, and staff training. Regardingpolicy reforms, the two major achievementsare: (a) bringing interest rates charged to farmers closer to market rates by gradually narrowing the gap between the prevailing rates on agriculturalloans and market rates; and (b) reducing the budgetary allocations to the Government-supportedcredit fund (FOSDA)l'beyond project objectives as covenantedin the Loan Agreement. Despite the results achieved on interest rate
1/ In 1987BNT had 91 branches,and by the end of 1991BNA baa 126 branches.
21 SpecialFund for AgriculturalDevelopment, created in 1963and fundedthrough Government budgetallocations. v -
reforms, however, scope remains for further improvements to make agricultural credit in Tunisia a financiallyviable activity. As expected initially, the fungibility of funds and harmonization of terms and conditions were not fully achieved during the project period due to the Government'sreluctance to make a clear-cut decision to transfer to BRA the responsibilityfor managing all credit programs, whatever their source of funds (paras. 6.01 to 6.06). The recovery performance (average rate of 78 percent) is mixed at BNA. After two consecutive droughts, accumulated arrears remain a problem including for the IBRD credit programs. Recent measures have been taken to improve the situation (paras.6.08 to 6.10).
7. BRA's overall operating results remain positive, though the bank's profitability and financial performance continue to be adversely affected by losses on agricultural credit activities. These losses are fully covered by BNA's overall profits on other activities. This means that BRA continues to cross-subsidizeits farm credit activitiesbut the project had a limited negative impact on cross-subsidizationas resources used under Loan 2865-TUN represent only 3 percent of BRA total outstandingportfolio. After a deteriorating trend between 1987-1990,the overall financialresults and structure of BNA have shown an improvement since 1991 (para. 6.08).
Sustainability
8. The benefits of the project from the investmentsat BNA's client level (farmers, agro-industries,fishermen) are good except in the rain-fed farming areas badly stricken by the drought. Institutionaland financial improvements at the BNA level through increased interest rates, recovery discipline (a good trend), and BHA reorganizationon a decentralizedbasis will better ensure the long-term sustainability of BNA as a profitable institution in a gradually liberalizedfinancial sector. Agriculturalcredit operations,however, are still not a profitable activity and are financiallysustainable only because they are handled by a well diversified,deposit-based commercial bank. Financing small- scale farmers is a high-risk,high-cost activity which needs furtherproductivity improvementsand some Government support, for climatic risks in particular, to make it a more sustainable activity in the future.
Findings and Lessons Learned
9. The Project has helped promote development of a financially sounder rural credit system which needs to be further incorporated into a gradually liberalized financial sector. The institutional changes initiated under the project are still fragile. In particular, there is scope for (a) consolidating and expanding the agriculturalcredit and rural savings systems in Tunisia; (b) developing further the institutionalcapability of BRA to respond to market demand in a competitive environment;and (c) diversifyingcredit operationsinto private rural non-farm activities. Consequently,there is a need to deepen the institutionalreforms and to strengthen BNA's capacity to assume its enhanced role. - vi -
10. The main lessons learned from this project can be summarized as followos
(a) the importanceof addressingthe issueof crop insurance/calamityfund schemesto securethe bankingsystem and farmerswhen seriousdroughts or other natural disasters occur, as one did during project implementation.It is esaentialto includesuch schemesas priority componentsin the designof rural financeprojects in a countrylike Tunisiawhere climaticconditions pose major risksJ
(b) the ruralbank (RNA)should be made fullyresponsible for all credit decisions,without Governmentinterference, and should assume 100 percentof the bankingrisk on all of its agriculturalloans to its clientele,including small-scale farmers, whatever the sourceof funds (fundsare fungible). This would improveresource mobilization and recoverydiscipline and make the bank's operationsmore viable and sustainable.In Tunisia,such accountabilityby the ruralbank would also help to betterintegrate the formalrural financialsystem with competitivebanking activities,including harmonization of lending terms and conditionsand enhancedfinancial discipline; and (c) the need for more time to fully implement major policy and institutionalreforms such as those underwayfor rural finance in Tunisia because of the long-termnature of institution-building objectives.Cross-conditionality on credit and interestrate reforms, encompassingthis project and two ASALs as well as continuityof dialogue between the Borrower/Guarantorand the Bank on these sensitiveissues, has been helpfulin achievingmajor progress.
11. These lessons have alreadybeen used to make furtherprogress on interest rate reforms and financialliberalization under the Economic and FinancialReforms Support Loan approvedby the Bank at the end of 1991. The lessons will also be used to consolidatecurrent progress on financial intermediationand to deepenthe institutionalreforms of BNA, the lead bank for agriculturein Tunisia. Reforms include BRA's on-goingreorganization and decentralization,especially in its agriculturalcredit department,staff training programs, fungible credit schemes for small-scalefarmers under simplifiedterms and conditionsand linkedto savingsmobilization, clientele diversificationactions (including women), and the developmentof a viablecrop insurance/calamityfund scheme. Plansfor furtherprogress along these lines are incorporatedin the proposed National Rural Finance Project under preparation. PROJECT COMPLETIONREPORT
REPUBLIC OF TUNISIA
FOURTHAGRICULTURAL CREDIT PROJECT (LOAN 2865-TUN)
PART Is PROJECT REVIEW FROMBANK'S PERSPECTIVE
1. Proiect Identity Name : Fourth AgriculturalCredit Project Loan Number : 2865-TIJN RVP Unit : MENA Region Country : Republic of Tunisia Sector : Agriculture Sub-sector : Agricultural Credit Borrower : National Bank of Tunisia'/ Guarantor s Republic of Tunisia 2. Project Background
2.01 During the past decade, the major objectivesof the Tunisian Government in the agriculturalsector, as expressed in the Seventh Development Plan (1987- 91), were to treat agriculture as a priority sector and to emphasize greater .&nvolvementof private sector financing in agriculture. To achieve these objectives,the Government,with the Bank's assistance,developed an Agricultural Sector Adjustment Program (1987-91)to support the implementationof the Seventh Plan. The overall objectiveof the sector adjustmentprogram was to maintain the growth rate in agriculture in order to reduce the sector's trade deficit while stayingwithin overallmacroeconomic constraints on public spending. To achieve this objective, the program provided for short- and medium-term actions tot (a) improve the prices and incentivesframework; (b) re-orientthe public investment program in agriculture toward low-cost, high-priorityprojects; (c) strengthen agriculturalsupport services and transfer some of them to the private sector; (d) improve the management of land, forests, and fisheries; and (e) build up institutional capacity for sector-performancemonitoring and policy analysis. The First Agricultural Sector Adjustment Loan (ASAL-I - Loan "754-TUN)was made to support this medium-term program. The key medium-term agricultural-credit objective for the Governmentwas to encourage the banking sector to increase its role in mobilizing resources,including savings/deposits;in providing credit to farmers, particularly small- and medium-scale farmers; and in ensuring the financial viability of credit operations. It was within this context that the Fourth AgriculturalCredit Project was formulated. The Project was designed to address these objectives by providing credit and supporting the 1987-91 agricultural credit reform programs in harmony with ASAL-I (and, eventually, ASAL-II).
AI BNTbefore merger with BNDAin 1989 and BNAafter the merger. -2-
2.02 Since 1967, the Bank has supported lending in Tunisia for agricu1ltural development through four loans and a credit (prior to Loan 2865-TUN) to the Banque nationale de Tunisie (BNT). The Fourth Agricultural Credit Project was the Bank's fourth lending operation in Tunisia to assist the country's agricultural development by providing credit to farmers, cooperatives, agro- industries,and fishermen. The first two projects aimed at addressing specific credit needs of farmers, with no explicit pursuit of either sectoral or broad- based institutional objectives. The Third Project (Loan 1885-TUN) aimed at increasingagricultural production and incomesof small- and medium-scalefarmers as well as improving the system of agricultural credit distribution by strengtheningthe agriculturalcredit operationsof the borrower, BNT. Although the Third AgriculturalCredit project focused on improvingcredit operationsand loan recoveryperformance, much remainedto be done to strengthenBNT's financial and institutionalviability. The previous projects suffered from a number of institutional and policy constraints that made on-lending Bank funds by BNT inefficient and cumbersome. In particular, competition from other credit programs, inadequateinterest spreads, arrears, and varying terms and conditions of various credit programs were still a problem. In the first three projects, disbursementswere slower than expected due to competitionfrom more attractive credit programs. For small- and medium- scale farmers, the principal beneficiariesof the Bank-financedsubloans, the Government also had a program of credit - FOSDA/FOSEPI'- which had interest rates more attractive than those for Bank subloans. Similarly, there was a proliferation of different credit programs with varying terms and conditions as well as different levels of risk to be borne by BNT. This, in turn, affected the recovery performance of these loans.3' The Fourth Project specificallyaddressed these problems.
3. Prolect Objectives and Description 3.01 The main objectives of the Fourth AgriculturalCredit Project were to promote development of a financially sound rural credit system and to finance credit to agriculture in support of the Government's Medium-Term Adjustment Program (1987-91) formulated in connection with the ASAL-I. This was to be achieved by improving agricultural credit policy, effecting institutionst adjustments, and increasing the finauLcialviability of agricultural credit operations. Through provision of investment credit to private farmers, the project was to contribute to increased agricultural production and rural employment. Through major policy and institutionalreforms, the project was to support the Government'smedium-term adjustment effort to establish a policy and institutional framework within which to promote development of a financially sound rural credit system. In particular, the project aimed to:
21 Special Fund for Agricultural Development and Special Fund for Fisheries Development. These were Government funds administered by BNT, providing loans at subsidized rates and grants.
31 For esample, on loans from its own resourcesfor which BNT bore 100 percent of the risk, repaymentwas 90X between 1985-87,uhile FOSDA loans, on which BNT was not responsiblefor granting credit and did not bear any risk, had a repayment rate of only 48 percent. - 3 -
(a) address sectoral issues related to on-lending interest rates designed to support BNT and the banking sector in increasing their role in mobilizing resources and in financing agriculture;
(b) restructure the complex institutional system by which agricultural credit is made available and improve small- and medium-scale farmers' access to credit; (c) introducenew approachesto harmonize credit terms and conditions and to improve the financialviability of agriculturalcredit operations;
(d) give more emphasis to private investmentin the agriculturalsector to meet the Government'sobjective of raising investment in the sector; and (e) promote savings schemes tied to eligibility for credit. 3.02 Proiect Description. To achieve the above objectives, the Project supported a three-yeartime slice of BNT's activities in the areas of agricultur- al credit operations and institutionaldevelopment. The Project, as agreed upon at negotiations,comprised the following credit and institutionalcomponents: (a) BNT Credit Proeram. The credit componentwas to finance (i) on-farm investments by small-, medium- and large-scale private farmers with special focus on increasing the resources lent to the first two groups; (ii) investments by production and service cooperatives;(iii) agriculturaland agro-industryinvestments carried out by small- and medium-scale enterprises;and (iv) investments in equipmentand major repairs by credit-worthyfishermen who already had fishing boats and good repayment records. (b) InstitutionalDevelopment Component. This included: (i) Management Information System (MIS) software, equipment and training needed to modernize and strengthen,on a decentralizedbasis, BNT's organizationalstructure, planning process, management control, accounting systems, and loan monitoring system; and (ii) the :trengtheningof agricultural credit policy coordination among the Ministries of Planning and of Finance; the Ministry of Agriculture/ Agricultural Production; the Central Bank (BCT); and, in particular, BNT and BNDA. About twelve man-months of consultancy services were provided to help set up the computerized systems and assist BNT's qualified trainers to implement the training programs. 4. Proiect Design and Organization 4.01 Design. The Fourth Agricultural Credit Project was developed, to a large extent, in light of the implementationproblems experienced in the then- ongoing Third AgriculturalCredit Project (Loan 1885-TUN)and the previous credit lines (para. 2.02). The Projectwas prepared at a critical time (the Government's medium-term adjustment program for the agricultural sector was being designed, and the Third Agricultural Credit Project was coming to completion) and was -4-
expected to play an importantrole in furtheringsectoral policy objectives. The Project was designed to be fully consistentwith the Government'smedium-term program, already agreed upon by the Bank and the Government under the ASAL-I. The Bank's involvementwas seen as catalyticin achievingproject objectivesmore rapidly. As a result, one important risk identified by the Bank - the Government'spossible lack of commitmentto going aheadwith the proposed reforms - was greatly reduced. Both the Project concept and the design were thus appropriate and .imely and were acceptable to all parties involved.
4.02 Preparation.A22raisal and Negotiations. The Project was identified jointly by BNT and the Bank in 1985. It was prepared by BNT and the Government from October 1985 to July 1986 in consultationwith other commercial banks and with the assistance of consultants for certain technical aspects. The Bank assisted in the preparationeffort through its supervisionmissions of the Third Agricultural Credit Project and appraisal of the ASAL-I. The main issues that surfaced during preparation and that were discussed during appraisal were: (a) insufficient intermediation spreads on agricultural credit operations that discouraged banks from financing agricultural activities and prevented many farmers from gaining access to credit; (b) the negative effect of subsidized credit programs (FOSDA and other special funds) on resource mobilization, sub- loan recoveries, financialviability of agriculturalcredit operations,and the Government budget; and (c) the proliferation of agricultural credit programs, each applying different conditions, using different appraisal criteria, and requiring costly and complex lending procedures.
4.03 The negotiationprocess did not pose any difficultybecause sensitive policy reform issues were approached realistically. Four main conditions of Board presentation - namely, revision of interest rates charged to farmers, reduction in Government budgetary allocations to the credit part of FOSDA subsidized credit programs, fungibility of funds, and the Government's policy letter on these issues - were discussedand negotiated,and agreementwas reached on all of these conditions. The Government confirmed in writing its agreement to the long-term objective of fully covering the financial costs and reasonable operating and risk costs of agriculturallending by 1991 and agreed to increase agriculturalinterest rates by not less than 0.5 percent for medium-termand 0.25 percent for short-termrates by August 30, 1987,which the Bank found acceptable. As a safeguard, this was stipulated as a condition of loan effectiveness. The Governmentwas also to revise agriculturalinterest rates between 1988 and 1991 to bring them in line with market rates by 1991.
4.04 The Government also agreed to the Bank's proposal to reduce its budgetary allocations to FOSDA credit by 15 percent in 1989 and 1990 and to achieve fungibility of funds by the end of 1989. An important condition of the Board presentationwas to incorporateproposals on all project-relatedissues in a Government policy letter on agricultural credit which would address project proposals on interest rates, spreads, FOSDA, recoveries, fungibilityof funds, risks, guarantees, and bad debt provision. This condition was met when the Government sent to the Bank in Nay 1987 a satisfactory policy letter on agriculturalcredit incorporatingthe specific proposals on the policy reforms to be executed by BNT under the Project and confirming that terms, conditions, and methods of credit delivery would be fully harmonizedby December 31, 1989, with all future ENT agricultural credit programs merged into a single fund managed by BNT. 5. Project Implementation
5.01 Loan Effectivenessand Proiect Start-Up. Although Loan 2865-TUN was approved on July 7, 1987 and signed on July 22, 1987, it did not become effective until January 22, 1988. Nonetheless, implementationof the project started immediately after loan effectiveness. The original date of effectivenesswas October 22, 1987. However, the Governmentrequested a three-monthextension to allow sufficient time for the Parliament to ratify the legal documents and to prepare and transmit the legal opinion. The only major condition of effectiveness,namely, that agriculturalinterest rates be raised to 7 percent on short-termloans and 7.5 percent on medium-term loans, was met on August 31, 1987. The Projectwas fully disbursedand closed on November 19, 1991, six weeks ahead of the original closing date. For the first time, an agriculturalcredit project in Tunisia was closed within the stipulated time. The previous three credit projects had had problems and delays in implementationand had closed from almost two-and-a-halfto three years after the original closing date, although none of them had included a policy reform package.
5.02 Prolect Risks. Of all the potential risks, such as weather and lack of commitment, that were identified by the appraisal mission, only the severe droughts during 1988 and 1989 proved to be a significantfactor impacting on the Project.
5.03 ImRlementation. The Project started off well with the creation of the AgriculturalCredit Reforms Committee,which was in charge of reviewing, among other things, the harmonizationof terms and conditions of agriculturalcredit and progress on eliminating the subsidy system. The implementationof the on- lending component, however, slowed down in 1988 and 1989 due to the droughts. The two consecutive droughts reduced demand for agricultural investments and services;affected agriculturaland livestockproduction throughout the country; and, as a result, lowered capacity utilization and farmers' incomeq. These drought effects had serious repercussions on loan collection, necessitating Government action to substantially reschedule farmers' debt payments. The implementation'of the institutionalcomponent was difficult due to the political sensitivity attached to agriculturalinterest rates in Tunisia, the complexity of the existing credit system, and the merger of BNT/BNDA (not covenanted in the Loan Agreement, though suggested in the Staff Appraisal Report) in October 1989. The disbursementswere on schedule as of March 1988, went down to 68 percent of appraisal estimates in June 1989, then improved to 74 percent of estimates in December 1989, and were on target at 100 percent at the time of loan closing in November 1991 (Part III, Table 3).
5.04 On-LendingComponent. The BNT credit componentproceeded well overall and was fully disbursed on a timely basis. Most sub-lending for the on-farm investmentsproceeded at a reasonablerate and was on appraisal targets, despite some slowdown during 1988-89 due to the two consecutive droughts. Because of these droughts, the borrower was more active in the agro-industry and fishery sectors. The fisheries sub-componentdid quite well, exceeding estimates by 82 percent, due to: (a) a boom in fishing boat construction in Sfax; (b) the privatization of "Office national des p8ches" (ONP); and (c) the need for increasingmajor repairs to be done on the old fishing fleet. Table 3a, Part III shows amount of loans disbursed as compared to those estimated at appraisal in each category. The main activities financed were agricultural and irrigation equipment for small-, medium-, and large-scale farmers and cooperatives;olive oil-refineries; refrigeration for agro-industries; and fishing equipment, trawlers, and repairs for fishermen. Under the fishery sub-component,the Bank agreed to finance trawlers not envisaged at appraisal to help privatizationof the ONP. The project reached, through BNA, 7,290 beneficiaries,including 6,010 small- and medium-scale farmers. By the time the loan was closed in November 1991, the follo'dingnumbers of beneficiarieshad been reached, as compared to those estimated at appraisal: Table 1: Number of Beneficiaries Actual Appraisal Actual Estimates as a Z of estimate Small & medium-size farms 6010 3400 176 Large farms 843 615 137 Production & service Cooperatives 209 160 130 Agro-industries 36 25 144 Fisheries 192 640 30 TOTAL 7290 4840 150
5.05 Institutional Component. As mentioned in para. 5.03, the implementationof the institutionalcomponent went well in spite of the political sensitivity attached to agricultural credit interest rates in Tunisia, the complexity of existing credit systems, and the negative impact of two droughts on credit demand and loan recoveries. Also, BNT and BNDA merged in October 1989, during the project implementation. This led to a change of top management twice in a period of six months. One of the difficultiesassociated with the merger was the integrationof BNDA activities into the new bank since BNDA had no branch network and suffered from non-performingloans.
5.06 The MIS sub-component of the Project started on time, and BNA establishedits computer managing committee in September 1987, as stipulated in the Loan Agreement. The purchase of micro-computersto fully equip BNT branches was approved in May 1988. The procurement of mainframe computer equipment for BNT headquarters was delayed by the merger of BNT and BNDA and by the late transfer of the merged bank to the new headquarters,built by BNT (not financed under the Project), which finally took place in April 1990. A computerized system to link the branches to the headquarters'mainframe was installed and became partially operational in 1991. BNA improved its accessibility to its clientele by increasing its network from 91 branches in 1987 to 126 by the end of 1991 and its staff from 2137 to 2522 during the same period. started to decentralize BNA has also its operationsby creating 13 "Directionsr6gionales" which authorityhas to been delegated for loan approval up to TD 120,000 (equivalent to US$123,600). This decentralizationprocess will speed up BNA's credit operationsat branch network level. Improvementsin the computerizationof activitiesand MIS made BNT overall good progress throughoutthe project'. life, with the current reorganization but of BNA, further improvementsare needed. 5.07 Training programs were prepared in 1988 and revised training every year. The activitiesmade good progress during project implementation be actively pursued but need to and conceptuallysharpened using a long-termglobal and a strategic plan. approach The new areas for priority training include strategic planning, branch network management, clientele development, marketing, and financial management and control. 5.08 Project Costs and Disbursements. Total project costs were at US$59.0 million estimated equivalent, of which IBRD was to contributeUS$30.0 equivalent, or approximately million 51 percent. The equivalentto US$12.0 million, 20 percent, was to come or from the sub-borrowers;and the equivalent to US$12.7 million, or 22 percent, was to come from BNT's own resources, augmented Governmentspecial resources by (US$4.3million equivalent,or 7 percent). Actual costs incurred were US$59.0 million equivalent, 100 percent of estimates. Disbursementsagainst IBRD loan proceeds amounted to US$30.0 million equivalent, 100 percent of the loan amount. The actual costs included US$2.2 equivalentfinanced million by an EEC grant after the BNT/BNDAmerger, which envisagedat had not been appraisal. The estimated and actual costs of the Project in Table 5a are given in Part III. The actual costs in each category were as had been mostly the same estimated at the time of appraisal. The Project did any major not suffer from cost overrun either in local currency or foreign exchange. 6. Prolect Results
6.01 The overall results of the project, in terms of achieving its main policy reforms and investment objectives, are satisfactory, compared particularly if to the previous three credit operations in Tunisia. envisaged Physical targets at appraisal were largely achieved - namely, lending, disbursement for on- the installation of computer facilities at headquarters branches, and regional and training of BNA staff. Similarly, a computerized information system management (MIS) with an improved accounting system was designed, hardware was purchased, and the system was made operational. BNA branches linked to the regions were and the headquarters. By category of beneficiaries, performancehas been very good. The project anticipatedan equivalentof million of the total US$8.0 credits to be channeled to 3400 small- and medium-scale farmers. The actual allocationresulted in US$8.1 million equivalent (i.e., percent of estimates) 101 being channeled to this group. The number of farmers reached, small-scale however, exceeded appraisal estimates by 76 percent, substantial achievement a in improving these farmers' access to credit. success with BNA's small-scale farmerswas partly due to farmers' increased small loans needs for after two difficult years of drought and low income to the phasing and partly due out of Government resources to finance these needs. 6.02 Progress on AgriculturalCredit Policy and InstitutionalReforms. The Fourth AgriculturalCredit Project incorporatedimportant elements of policy and institutional conditionality. On policy reforms, this included interest rate adjustmentto market rates, phasing out Government subsidizedand directed credit (FOSDA),and achieving fungibilityof funds to finance agriculturalcredit needs for a better response to market demand. On the institutionalside, the project incorporatedthe establishmentof an efficientorganization and MIS for BNT; the full-fledged adoption of effective computerization at the branch network, regional office, and headquarterslevels; reform of the credit decision process by phasing out Government interferencein credit decisions for loans to small- scale farmers and by transferringthe risk to BNT; and training of staff. In addition, as a result of the merger of BNT/BNDA,BRA had to tackle the difficult task of complete reorganizationof the merged bank while at the same time moving to its new headquartersin 1990. 6.03 The progress made on interest rates is commendable, considering the high political sensitivity attached to agricultural credit interest rates in Tunisia. According to the Loan and Guarantee Agreements, the Guarantor and the Borrower had to adjust interest rates so that, in 1991, the Borrowerwould charge agricultural credit interest rates equal to market rates. The interest rates were increased by 0.5 percent for medium-term and 0.25 percent for short-term rates in August 1987, as a condition of loan effectiveness. These rates were further adjusted by 1 percent for medium- (8.5 percent) and short-term (8 percent) rates in August 1990. No upward adjustment of interest rates was done in 1988 and 1989 due to the two consecutivedroughts as well as to the downward trend of the average money market rate from 10.5 percent at the end of 1987 to 8.7 percent by the end of 1988. The Bank agreed to this decision of the Government,keeping in view the bad weather and overall interest rate situation. The Government increased interest rates further by 1 percent for small-,medium- and large-scale farmers in December 1991. The following Table 2 shows the progress made on preferential interest rates since 1987: Table 2: Interest Rates (in percentages)
Before August Negotiations 1987 1988 1989 1990 1991
Market Rates 10.5 10.5 8.7 9.5 11.4 11.7
PreferentialAgricultural Credit Rates'! Short-term 6.75 7 7 7 8 9 Medium-term 7 7.5 7.5 7.5 8 9 Long-term 7 8 8 8 8.5 9.5 Differential 3.5 2.5 0.7 1.5 2.9 2.2 Between Market to to to to to to Rates and Average 4.25 3.5 1.7 2.5 3.4 2.7 PreferentialRates
/1 Essentially for creditto small-and medium-scalefarmers, although many commercialfarmers manageto have access to these low rates underthe Governmentsubsidized schemes, which are presently beingphased out. Theserates do not applyto agro-industries,for whichmarket rate is applicable and otherbanks compete with BNR. -9
6.04 Having reached a minimum of 9.0 percent, preferential interest rates in Tunisia are positive in real terms. BHA average cost of resources for agriculturalcredit (less than 62) remained stable during the project period, which means that return on resourcesused increased. However, the margin is not yet sufficient to cover operating costs and risks associated with the agriculturallending. There still is room for improvement and a need to reduce the gap between the market interest rates and rates charged for agricultural credit. Interest rate reforms and financial liberalization issues are now addressed under the Economic and Financial Reforms Support Loan (3424-TUN) approved by the Bank at the end of 1991. Action agreed under this Support Loan include minimizing administrative constraints on interest rates, and an additional two point increase on the rates of preferentialcredits.
6.05 Major progresswas also made in phasing out Governmentsubsidized FOSDA credit allocations, which were reduced by 15 percent in 1988 and another 15 percent in 1989 as agreed under the project in a consistent manner with ASAL-I and ASAL-II policy frameworks. Since 1990, the budget allocationsto the credit part of FOSDA have been eliminated. The achievement on this has been beyond project objectives, though with fragile results. The financingof agricultural lending operationswill depend on BHA's ability to mobilize resources.
6.06 Some of the long-term reform objectives, such as the fungibility of funds, harmonization of terms and conditions, recovery performance,and BNA's reorganization,are far from being fully achieved. Full realization of these reformswill require more time than the short project implementationperiod. In particular, the Goveranent needs to make a decision on merging all Government- supported agricultural credit programs into a single fund at BNA. There were about 45 special credit programs with different appraisal criteria and lending procedures at the start of project. These multiple funding sources, each with its own particular conditions, make the management of agricultural credit difficult and have created confusion among borrowers. Many of these special programs are currentlybeing phased out or graduallytransferred to BHA, but some are still managed by the Government, essentiallyby the Ministry of Agriculture (MOA), and are administeredby BNA for disbursementand recovery purposes only. Consolidation of all these special programs into a single agricultural fund remains an important prerequisite for future development of the agricultural credit system. This will allow BNA to properly allocate credit funds in response to the demand for credit and in line with its institutionalobjectives and its credit guidelines and harmonizedterms and conditions. The July 1990 agreement rea^hed between the Government,BRA, and internationaldonors has reinstatedthe need to harmonize the terms and conditionsfor agriculturalcredit under the full responsibility (without Government interference) of BNA and other banks. BHA should assume 100 percent of the banking risk on all of its agriculturalloans to its clientele, including small-scale farmers, whatever the source of funds (funds are fungible). This would improve resource mobilization and recovery discipline and make the bank's operations more viable and sustainable. In Tunisia, such full risk assumptionby BRA would also help to better integratethe formal rural financial system with competitive banking activities, including harmonization of lending terms and conditions. - 10 -
6.07 Similarly,with regard to BNA's reorganization,progress has been slow. At the time of the merger, BNA was faced with three important tasks: (i) reorganizationof the new bank on a decentralizedbasis to reach more efficiently a large number of farmers and rural clients; (ii) integration and harmonization of the activities and accounts of the two banks; and (iii) preparation of a new lending program for the future. With the assistance of management consultants, a reorganizationplan of all BNA departmentswas prepared and submitted to the Bank. Following the merger, and after the July 1990 agreement, the role of BNA was considerablyenhanced. These developmentsresulted in a gradual shift in the decision-makingprocess for Government-supportedagricultural credit for small- scale farmers from the MOA to BNA. This consolidationwork is far from being completed, however, and the BNA reorganizationplan has not become operational yet. Completionof this consolidationand reorganizationwill be one of the main institutionalobjectives of the follow-up Rural Finance project. 6.08 Financial Performance. The financial results and structure of BNA, after a deterioratingtrend between 1987-1990,have slightly improved since 1991. BNA's overall operating results remain positive, though the bank's profitability and financial performance continue to be adversely affected by losses on agricultural credit activities. The profits earned on BNA's commercial transactionsfully cover these losses on its agriculturaloperations. This means that BNA, despite increases on interest rates charged to farmers, has not yet been able to break even on farm credit activities and continues to cross- subsidize them.4/ BNA's financial performance is also affected by: (a) the consequences of the BNT/BNDA merger - non-performing loans of BNDA; (b) the negative impact of two consecutive droughts on recoveries; (c) increased competition in the banking sector for access to market resources and savings resulting in an increase of the average cost of funds; and (d) overall portfolio quality. To reverse this trend, measures have been taken in addition to a new increase in preferentialinterest rates at the end of 1991. These measures are: (a) BNA's decision, in January 1992, to launch a program to improve recoveries by creating decentralized recovery teams with adequate incentives; (b) the strengthening of BNA's equity base through a new capital increase, from TD 33 million to TD 55 million at the end of 1991, which became effective March 1, 1992, a move to improve BNA financialstructure as measured by the ratio of total equity to risk-weightedassets from 5.5 percent to about 6 percent, but still not a satisfactory level accordiig to the standards (8 percent) of the Basel Committee of Banking Supervision5/;(c) an improved policy for provisioning since 1991; and (d) a systematicpolicy for maximizing profits through increased fees charged to clients, in addition to interest rates, to cover operating costs.
41 Resources used under Loan 2865-TUN representonly 3 percent of BNA total outstandingportfolio (short-and medium-term)at the end of 1991. Correspondingcredit operationshave consequentlya limited negative impact on the overall profitabilityof BNA. The project, however,although small compared to BNA overall activities,had a strong positive impact on interest rate reforms.
I/In 1987, after the doublingof its capital in 1986, BNT had a solid 9.8X Cooke ratio. After two years of drought and accumulatedarrears, and a merger, BNA needs to improve its equity to risk assets ratio. - 11 -
6.09 Loan Recovery. When droughts had a negative impact on recoveries,the Governmentdecided to take substantialmeasures urging BHA to reschedulefarmers' debt. This, together with previous rescheduling, almost doubled BNT's outstanding portfolio to agriculture. Though recovery performancewas closely monitored during 1988-89, the overall situation did not improve except artificiallythrough debt rescheduling. BNT had to mobilize new resources in the financialmarkets to cushion the impact of the drought on its liquidity since the existing Calamity Fund in Tunisia is totally inoperational. In addition, the National Guarantee Fund, established in 1981 to cover outstanding principal in the loan portfolio of banks lending to small-scaleagriculture, is inadequately funded and in any case does not cover banks for default resulting from natural calamities. The Bank prepared a p-eliminary report issued in March 1991 on how to set up a viable calamity fund as part of a major study on Small Farmers' Potential and Prospects: A Technical Studs (Report No. 9323-TUN). During its various supervision missions, the Bank also recommended reorganizationof the National Guarantee Fund by merging it with the existingCalamity Fund with a view to developinga sound insurancescheme to cover climatic risk. According to the proposed scheme, the premium payments would be shared by the sub-borrowers,the banks, and the Government. This scheme is not yet established.
6.10 The recovery performance is linked directly to the risk borne by BRA as shown in Table 4(a) in Part III of this report. The recovery performance of the loans made by BRA under its sole responsibilitywas 92 percent during the project period, whereas the overall recovery rate for all agricultural lines combined was 78 percent."' The accumulated arrears, which were TD 20 million in 1986, reached TD 135 million by June 1991. The Bank has consistently asked BNA and the Government to improve the recovery rate. The recovery analysis clearly demonstrates that when BRA is given sole responsibility for credit decisions (approvalsand recoveries)without Government interference,and when BNA assumes 100 percent of the banking risk, recovery performance is good. One of the conclusionsof the Project, thus, is that unless BRA is made responsible for all credit decisions and assumes full responsibilityfor credit distribution and risk, this chronic problem of recovery will not be solved. 7. Prolect Sustainabilitv
7.01 The benefits of the project from the investments at the BNA client level (farmers,agro-industries, fishermen) are evident except in the rain-fed farming areas badly stricken by the drought. Institutional and financial improvements at the BRA level through increased interest rates, recovery discipline (a good trend), and BRA reorganizationon a decentralizedbasis will better ensure the long-term sustainabilityof BRA as a profitableinstitution in a gradually liberalizing financial sector. Agricultural credit operations,
6/ Recovery on IBRD credit programs (past loans and Loan 2865-TUN) is in the range of 66 to 74Z over the life of this project with no clearly improvingtrend yet. This issue will be addressed under the follow-upproject. To enable BNA to take 1OOZof the banking risk on all its farm clients, Tunisia needs to develop a sound insurance scheme to cover climatic risk. This is particularlyimportant when BNA is financing small-scalerain-fed farming as this was the case under all IBRD loans to BNT/BNA. Recovery on governmentsubsidized credit programs is 50S, which is unsatisfactory. - 12 - however,are stillnot a profitableactivity and are financiallysustainable only becausethey are handledby a well diversified,deposit-based commercial bank. Financingsmall-scale farmers is a high-riskand high-costactivity on account of the collateralissue, a poor land tenure system, drought,etc. Further productivityimprovements and some governmentsupport for climaticrisko, in particular,are requiredif small-scalefarmer financing is to become a more sustainableactivity in the future. 8. ConsultingServices 8.01 Consultantservices were hired for computerizationactivities at the beginningof the Projectperiod. However,the remainingfunds allocatedfor these serviceswere not used since grant money of US$200,000was receivedfrom EEC in 1990/91to hire consultantsto carry out a study on the reorganizationof the BNA. The performanceof the consultantswas satisfactory.The BNA, howaver, has not yet adoptedthe consultants'recommendations on reorganization (para.6.07). 9. ProiectDocumentation and Data 9.01 The StaffAppraisal Report, Loan Agreement and GuaranteeAgreement, and the GovernmentPolicy letterwere importantreference documents which proved usefulboth to the borrowerand to the Bank supervisionmissions, and all of these documentswere helpfulin the writingof this report. The qualityof the projectdata submittedby the borrowerwas good overallbut deterioratedafter the BNT/BNDAmerger which resultedin some good BNT staff in chargeof project monitoringand evaluation/reportingbeing redeployedto other functions. BRA regularlysent quarterlyand annualreports to the Bank which includeddata on numbersand types of beneficiaries,amount of investment,and lendingtrends. BNA also submittedaudit reportsto the Bank, maintaininga good track record with regardto timeliness,quality of reports,and minimalaudit qualifications. 10. Bank Performance 10.01 The Bank closelymonitored the preparationphase of the project,and the appraisalmission took place in November1986. The Bank'ssupervision effort was adequate,and good staff continuitypersisted between missions, helping to maintain a constructivedialogue with the Governmentand BHA and to resolve problems. Timelyassistance was providedto the Governmentin the formulation of new credit policiesat the time of merger of BNT/BNDA. The Bank acted flexiblyin 1988-89in acceptingthe Government'sdecision to postponeincreasing interestrates, keeping in view the bad weatherand the fact that market rates went down duringthis period. 11. Borrowerand GuarantorPerformance 11.1 The overallperformance of the borrowerand guarantorwas good. The projectwas implementedsmoothly and with commitmentto project objectives. Importantinstitutional changes occurred during project implementation, such as the merger of BNT and BNDA into BRA. Althoughoverall a positivestep, this mergerled to two consecutivechanges in top managementand staff re-deployment - 13 -
that delayed the implementationof some on-going institutional reforms (HIS, headquarterscomputerization, fungibility of funds, monitoring and evaluation). This delay could have been avoided had the merger been prepared in greater technical detail by the local authorities. The merger, which was decided at the highest Government level, showed clearly that BNDA was not financiallyviable for the long term. BNA now has the potential to improve its management leadership and needs to adequately train staff to perform its new functions. Adequate incentivesstill need to be provided to the staff for loan collection and savings mobilization. The AgriculturalCredit Departmentof BRA needs to be reorganized and strengthenedat the headquartersand branch network levels.
11.02 The compliancewith covenantswas mostly good (Part III, Table 6). On interest rates, both the Guarantor (decision making) and the Borrower (implementation)made substantial progress in complying with legal covenants. The borrower also compliedwith audit covenants and submittedan annual analysis of its credit operations,as expected. Covenantson MIS, establishinga computer managing committee,and preparingan annual trainingprogram were also fulfilled. BHA followed Bank's procurementguidelines as stipulated in the Loan Agreement. The Bank guidelines were followed for the computer equipment for the branch network and headquartersexcept that, at the last minute, the Bank was informed that the headquarters equipmentwould be procured and financed under EEC grant money made available to BRA after the merger, a decision the Bank accepted. Thus far, however, the Government has not been fully successful in achieving all the reforms incorporatedin the Policy Letter (para.6.06). The Government achieved, well beyond project objectives, the reduction of budget allocations to FOSDA credit, but it did not achieve fully the objective of increased fungibility of funds, starting with the harmonizationof credit terms and conditions. 12. Proiect Relationship
12.01 The relationshipbetween the Bank and the Borrower (and the Guarantor) was excellent and remained cordial throughout the life of the Project. The continuity of dialogue from appraisal to completion (including during the supervisionprocess) between the Bank and the Tunisians has been instrumentalin building trust and in achievingmajor progress.
13. Lessons Learned
13.01 The key lessons of the project, for both the Bank and the Borrower, can be summarizedas follows. (a) It is important to address the issue of crop insurance/calamityfund schemes to secure the banking system and farmerswhen serious droughts or other natural disasters occur, as happened during project implementation. It is therefore essential to include such schemes as priority components in the design of rural finance projects in countries like Tunisia where climatic conditions pose major risks.
(b) Tunisia needs a rural bank (BRA) to be made fully responsible for all credit decisions without Government interference and to assume 100 percent of the banking risk on all of its agricultural loans to its - 14 -
clientele,including small-scale farmers, whatever the source of funds (funds are fungible). This would improve resource mobilization and recovery discipline and make the bank's operations more viable and sustainable. A fully responsiblerural bank would also help to better integrate the formal rural financial system with competitivebanking activities, including harmonization of lending terms and conditions and enhanced financial discipline.
(c) There is a need for more time to fully implement such major policy and institutionalreforms as those underway for rural finance in Tunisia because of the long-term nature of institution building objectives. Cross-conditionalityon credit- and interest-ratereforms between'this project and two ASALs as well as continuity of dialogue between the borrower and the Bank on these sensitive issues have been helpful in achieving major progreas.
13.02 These lessons have already been used to make further progress on interest-rate reforms and financial liberalization under the Economic and Financial Reforms Support Loan approved by the Bank at the end of 1991. The lessons will also be used to consolidate current progress on financial intermediationand to deepen the institutionalreforms of BNA, the lead bank for agriculturein Tunisia. These reforms include BNA's on-going reorganizationand decentralization, especially in its agricultural credit department, staff training programs, fungible credit schemes for small-scale farmers under simplified terms and conditions and linked to savings mobilization, clientele diversification actions (including women), and crop insurance/calamity fund schemes. Progress on financial intermediationand institutional reforms are objectives of the proposed National Rural Finance project under preparation. - 15 -
PART II: PROJECT REVIEW FROMBORROWER'S PERSPECTIVE
(REPORT ROMsNA OF MARCH2, 1992)
BANQUE NATIONALE AGRICOLE Directorate General Tunis, March 2, 1992
Hr. Odin Knudsen Chief, Agriculture Operations Division Middle East & North Africa Regional Office The World Bank Washington, D.C.
Reference: Loan No. 2865-TUN
Subject: Proiect CompletionReport
Dear Sir:
Following the closing of the above-referenced loan, we have the pleasure of sending you herewith the completion report.
We would also take this opportunity to inform you that we gave two copies of the report to Mr. Dussert during his completionmission at BNA from February 17-20, 1992.
Very truly yours,
/a/ Mokhtar Atallah Deputy Director General - 16 -
1. Overviewof the Prolect A. T'troduction Followingthe completionof the Third AgriculturalCredit Projectin 1986,BNA and the Governmentof Tunisiarequested the World Bank to assistin the financingof a FourthAgricultural Credit Project under a medium-termadjustment program for the agriculturesector, in accordancewith the objectivesof the SeventhPlan coveringthe periodof the project,i.e. from 1987 to 1991. That programaims essentially at accordingpriority to privateinvestment and encou:agingthe bankingsector to participatein financingof agricultural activities. B. The Project (a) PreDarationand ar2raisal The projectwas identifiedin 1985 jointlyby BRA and the Bank. It was preparedin 1986 by BNA and the Government,with the assistanceof consultants and the supportof Bank supervisionmissions for the Third AgriculturalCredit Project(Loan 1885-TUN). The projectwas appraisedin November1986 by the consultantsand a Bank supervisionmission. The Loan Agreementbetween BNA and the Bank was signedon July 22, 1987 for US$30 million. (b) Projectobjectives Followingthe previouscredit lines and the sectoraladjustment program for medium-termagricultural credit agreed upon betweenthe Governmentand the Bank, thn muainobjectives of the projectvere as follows: - Increase financial assistanceto agriculturein order to enhance agriculturalproductivity and rural income; - Increasethe mobilizationof nationalresources; - Ensurethe financialviability of creditoperations. In addition,the projectwas to help BNA: - Restructurethe institutionalsystem for grantingagricultural credit and facilitateaccess by small-and medium-scalefarmers to credit; - Improve the situationof sources and uses of funds for financing agriculture; - Develop long-termplans to strengthenits agriculturalportfolio and ensurethat BNA continuesto play the role of lead bank in the financing of agriculture; - Extend its decentralizationefforts to its agricultural credit operations; - Promotesavings schemes tied to eligibilityfor bank credit; - 17 -
- Strengthen and improve its management information and data processing system through the use of computers. (c) Proiect components In order to enable BNA to achieve its objectives and improve the financialperformance of agriculturalcredit, two programswere planned under the project, namelys
- A credit program to finance: * small- and medium-scale farmers * large-scale farmers * production and services cooperatives * small- and medium-size agro-industrialenterprises * equipment and major repairs for fishing boats
- A credit program for institutionbuilding, including: * the establishment of a management information and a computerized data processing system * a personnel training program. 2. Proiect Development and Implementation A. Proiect Development
In general, project performance was favorable relative to appraisal projections regarding: (a) Duration The completion dates for earlier agriculturalcredit lines experienced delays ranging between two and three years. The Fourth Ptoject is the only credit operation to be completedbefore the scheduled date cr.! December 31, 1991, despite a marked slowdown in lending activities in 1988 at&d1989 due to the drought, although the project had gotten off to a good start. The credit proceeds were effectively depleted on September 30, 1991, i.e., three months early, and the last Bank disbursementwas made on November ! 1991, i.e., six weeks ahead of the official closing date of the Bank loan. (b) Number of farms affected by the project Under Part A of the project, the number of farmers revalving financing far exceeded projections. Ultimately,there were 7,290 benefic-.arziesas against the projected 4,840, i.e., an increase of 51 percent, primarily in the category of small- and medium-scale farmers. (c) Volume of investments The project cost was appraised at TD 51.3 million (equivalent to US$59 million).
The baseline estimates were expressed in 1987 prices, with foreign exchange representingsome US$30 million.
The final cost was about TD 51 million, which is consistentwith initial projections. - 18 -
(d) Disbursements Despite a good start, but abruptly slowed by the drought, real disbursementswere made over a period of less than four years, more than one year ahead of the five-year period suggested by experience under the previous agriculturalprojects.
Broken down by year, disbursementsin 1991 alone accounted for more than 45 percent of the total.
This was due primarily to improved progress of the project in 1990 and 1991. During that period, subloans increased considerably under the five project components,primarily in the category of "fisheries." B. Proiect Implementation
The project became effective on January 22, 1988, six months after the signature of the Loan and GuaranteeAgreements and their ratificationby Law No. 87-78 of November 26, 1987.
Project start-upwas followed by an abrupt slowdown in implemen-tation, particularlyfor several components,due essentiallyto problems of a short-term nature (1988 drought followed by a second in 1989). (a) Small- and medium-scale farmers This category, which had a rockier start-up than the others after the drought during the 1987/88 crop year, also suffered from the relatively long time it took the branch offices to process applicationsand shift responsibilityfor them to central offices.
Only in 1988/89did the number of subloans begin to rise steadily and at a faster pace, but the total processed each year could have been higher if the country had not been stricken once again by a drought in 1988/89. The number of beneficiariesunder the project neverthelesstotaled 6,010 farmers, as against the 3,400 projected,i.e., an increase of 77 percent, thanks to the good years in 1990 and 1991 and an upswing in demand in the wake of the drought.
The number of loan applications to finance the purchase of irrigation equipment and well construction far exceeded projections, due to climatic vagaries that triggered heavy demand in that regard.
Financing was also provided in response to 1,496 applicationsfor loans to purchase minor agriculturalequipment at relatively low cost.
A comparison of costs by type of investment shows an increase over initial projections under three main headings involving infrastructure and irrigationequipment, cattle- and sheep-raising,and agriculturalequipment. The amount allocated for this componentwas completelyutilized. - 19 _
(b) Large-scale farmers Regular sustainedprogress was made on this component from the start of the project.
The number of farms covered by the project totaled 843, compared to the 615 initially projected, i.e., an increase of 37 percent, essentially in farm mechanization and irrigation, which covered 444 and 224 beneficiaries respectively,as compared to the 238 and 45 projected at appraisal.
However, the volume of investments (TD 11.9 million) was below projections (TD 15 million), i.e., by 22.4 percent. This was due essentially to: - an overestimationof the average cost per operation calculatedinitially at TD 25,000, whereas the actual amount at the end of the project was only TD 14,100;
- credit opportunitiesoffered by BNDA prior to its merger with BNT, which had the effect of absorbing,at the expense of the project, several loan applications from large-scale farmers, especially for integrated projects.
Investments by type fall primarily into three categories, namely, agriculturalequipment, irrigation, and tree-planting,respectively representing 64Z, 18.7%, and 9.7% of investmentcosts under this component. (c) Cooperatives Implementation of the programs under the Agricultural Production Cooperatives(UCPs) was favorableat the start of the project, but flagged during the last years.
Some loan applicationswere directed by the UCP Oversight Office (Bureaude Contr8le) to the former BNDA for the financing of integratedprojects. For the Rural DevelopmentAssociations (SCMVs) and service cooperatives, financingwas very limited, as only four subloans were made under the project for a total of TD 278,000. Most applicationswere also channeled to the former BNDA for financing under the special funds available to them.
However, despite these constraints,the results for the cooperativesector exceeded projections in number and volume.
In fact, 209 subloans were made, for a total of TD 5.5 million, compared to the 160 projected, for a total of TD 4.8 million.
Investments essentially involved agricultural equipment, for a total of TD 4.66 million, compared to TD 4.3 million initially projected. (d) ARro-industries The start-up of investments under this new category experienced difficultiesdue to a lack of new investmentniches during the early years of the - 20 -
project. In fact, only three subloanswere made during this period. It was not until 1990 and 1991 that investmentclimbed satisfactorily. Thirty-six subloans were made under this component for an overall investment of TD 6.2 million, compared to the projected 25 loans for TD 6.5 million.
An analysis of investmentsby type shows a predominanceof demand in the olive-growing sector and, to a lesser extent, in the cold-storage sector, representing respectively 53 percent and 17 percent of the total cost of investments.
Demand related to olive-growing rose in response to the incentives and facilities granted by the Government for the modernization and expansion of old refineries that had become obsolete and no longer met the country's needs. (e) Fisheries Subloans under this heading were double the projections, despite a difficult start-up due essentially to problems with constituting guarantees, a lack of down payments, and the selection of beneficiarieswho met the technical and financialcriteria as well as the creditworthinessstandards. BNDA's epecial involvementon a prioritybasis in this sector,however, reduced the participation of the commercial banking sector in the financingof fisheriesduring the project period.
The cost* of investments was TD 11.1 million, compared to the TD 5.7 million projected, i.e., an increase of 95 percent.
By contrast, the number of beneficiariesprojected initially at 640 was overestimated and in reality totaled only 192.
Performancewith regard to the volume of investmentswas associatedwith two main operationscarried out during the project and not planned at the time of appraisal, namely:
(i) The privatization policy put into effect by ONP, resulting in the purchase of its trawlers by private parties. Estimated subloans of TD 4 million were made under the operation to 29 beneficiaries. (ii) The financing of new trawlers for private shipowners. To respond to the Government's priorities and objectives involving the modernization of the fishing fleet, which had become obsolete, at BNA's request, the World Bank also agreed to finance this operation. The investments totaled more than TD 4 million, involving 23 shipowners. C. Institutionaland Financial Performance (a) InstitutionalRerformance During project implementation,a number of measures were introduced on a national scale to improve the agricultural credit system and the financial viability of such operations. - 21 -
(i) Measures taken: The measures included: - The establishmentof the Agricultural Credit Reform Committee in early 1988, as envisaged in the GuaranteeAgreement, to make recommendationsto the relevant authoritiesand to monitor the implementationof agriculturalcredit policy reforms; - Following the 1987/88 and 1988/89 droughts, the Council of Ministers on August 3, 1988 took the followingmeasures: * the reschedulingover three years of short-term credit for rain-fed cereals production and olive plantations; * the postponing of maturities on medium- and long-term credit for rain-fed cereals, olive-growing,and stock- raising;
* the implementation of a special government program to assist small-scalecereals producers.
Additional measures were also taken by the Government in 1989: - Cancellation of debts contractedby farmers prior to 1987 for all credit with a principal of less than TD 1,000. This measure affected some 130,000 farmers;
- Cancellation of debt vis-&-vis the "Societe tunisienne d'4lectricit6 et du gaz" (STEG) contracted prior to 1987 by farmers in joint interestassociations (associations dWint6r8ts collectifs -- AICs) in the Rouvernorats in the south; - Price increases for the production of milk, fresh meat, cottonseed, and olive oil. (ii) Budget allocations The Government's commitment to reducing budget allocations was pursued regularly during the years of the project, in accordance with the loan agreement and the medium-term adjustmentprogram for the agriculture sector.
FOSDA (Special Fund for Agricultural Development) (credit and subsidies) allocations to BNA during that period were as follows: Year 1987 1988 198 19 1991 Amount(ID million) 18.86 17.84 18.50 17.00 13.00(11/30191)
The portion of the FOSDA allocations reserved for credit has been virtually eliminated since 1990, the bulk of the annual allocation being used for direct capital subsidies.
These measures aim to make the banking sector more accountable in agricultural operations and to more effectively channel budget resources to non-bankable,low income beneficiaries. - 22 -
(iii) Funfibilitv of funds The objectives concerning the fungibility of funds in the Fourth Project essentially includes - harmonizing agriculturalcredit systems;
- merging on a national scale all future BNA agricultural credit programs, as well as funds flowing through FOSDA/FOSEP (Special Fund for Fishery), into a single fund;
- mobilization of new domestic and external bank resources. Although progresswas made in this regard, the problems of multiple and competing lines of credit were not totally resolved, given the ambiguity and diversity of credit procedures. Nevertheless, through the intermediaryof agriculturalcredit working groups, the Government is determined to give priority to these objectivee, for which efforts are well on their way but which require decision-makingexternal to BNA if they are ultimately to become a reality.
(iv) BNA training vrogram To upgrade its personnel, BNA offers training programs each year. Internships and seminars in Tunisia and abroad have been organized on various topics, including agricultural and commercial activity and diverse other banking operations.
Technical personnel in the branch offices in charge of agricultural credit received training in 1988 and 1989 in the form of seminars on the evaluation of credit applications.
DNA's training budgets have financed the following activities: - courses at the Professional Banking Training Center (Centre Professionel de Formation Bancaire -- CPFB) and the Technical Banking Institute (Institut Technique des Banques -- ITB), in addition to accounting courses;
- seminars in Tunisia and abroad; - hosting of trainees; - training of new recruitG;
- internships and refresher courses; - training of future middle managers (cadres d'exploltatlon); - internal competitive examinations for higher-level staff and agents;
- introductionto computers for higher-level staff and agents; - training for seniormanagers. - 23 -
(v) Organizationplan After its merger with the former BNDA in October 1989 and the measures taken by the Government in December 1989 to give new impetus to agricultural credit on a decentralized basis, BNA launched an organizationalstudy enabling it to revitalize its offices and make them homogeneousand effective. A new organizationchart was prepared and will probably be implemented in the first quarter of 1992. The network of BNA branch offices and personnel spread with the opening of 24 new branches between 1987 and 1991, for a total of 126 branches and offices as of December 31, 1991. Personnel were increased from 2,137 to 2,522 during the same period.
In addition,with a view to strengtheningthe decentralizationpolicy, BNA gradually expanded the authority of the regional directors, enabling them to grant agricultural loans up to a maximum of TD 120 million.
(vi) BNA computer olan After having equipped its branches and central offices with computer hardware and software in accordance with project projections, BHA developed a computerizationplan and began its implementationin the branches and regional offices and at headquarters.
The main actions during the project can be summarized as follows: - installationof microcomputers for all branches, permitting the computerization of accounting operations (all operations are entered at the branch level and transmittedat the end of each day to headquarters);
- acquisition of new computer hardware: two 9221 computers for headquartersand 13 AS 400 minicomputers for the regions.
The two computers are already operational within the Computing Activities Department. Porting of existing applicationson the 4331 was done as a first step.
A study is now under way to rewrite certain applicationsand improve others, in addition to the study on new systems for the computerization of all bank operations.
The AS 400s are assigned to certain central departments and regional offices.
A team is now studying the installment of these minicomputers in the regional offices and preparing for the decentralizationof certain publishing operations.
Likewise, improvementswere made to the branches' computer system: - computerizationof the portfolio; - 24 -
- computerizationof commitmentsby signature;
- study on the decentralizationof the agriculturalcredit process. (b) Financial performance
(i) Recovery Despite the institutionaldevelopment (describedabove), the recovery situation is still disturbing.
A look at the situation over the last five years shows that the droughts that wracked the country in 1987188 and 1088/89had serious repercussions on the repayment of agricultural credit. The average recovery rate on November 30, 1991 was 74 percent for all funds considered together, with a variation from 6 percent (IFAD-financed Sidi Bouzid project) to 91 percent (BRA), depending on the nature of the fund. Consequently, the recovery situation during the project did not improve, despite the decisions taken by the Government and the good crop during the 1990/91 season. In addition to the drought, the following also contributed to the lack of progress in recovery performance: - the accumulationof arrears from one year to another; - the plethora of lines of credit used with different selection criteria,choice of beneficiaries,and methods of assessingneeds and covered risks;
- the diversity of conditions imposed by certain donors and the inadequatemonitoring and recovery system;
- a confusion among credit beneficiariesbetween aid to agriculture and agriculturalcredit. In addition, the effortsmade by BRA to improve the recovery rate were as follows: - delivery of new credit only upon the settlement of arrears; - withholding of arrears on all crop sales;
- making farmers aware of the importance of paying their arrears in the appropriatecrop year;
- transmission of overall risk statements to the branches and regional offices for arrears monitoring;
- transmissionof notices and due date reminders to all debtors. Finally, beginningin 1992, followingtwo good harvests in Tunisia, BNA decided to set up regional recovery teams with the necessary authority - 25 -
and incentives to strengthen recovery efforts with the support of governmentauthorities at the highest level. (ii) Aaricultural interest rates The current preferentialinterest rates for agriculture still provide insufficientreturn to cover the average cost of funds (which is on the rise with the liberalization of the financial markets), operating costs, and BNA's banking risks.
The objective in the Loan Agreement for the Fourth Project was to narrow the gap, by the end of 1991, between preferential rates for agricultural loans and the interest rate prevailing on the money market, which was 11.8 percent at that time.
The agricultural interest rates, which before August 1987 were 6.75 percent for short-term loans and 7 percent for medium- and long-term loans, were raised on three occasions during the project, reaching 9 percent in January 1992 for short- and medium-term loans and 9.5 percent for long-term loans.
The successiveadjustments made to these rates slowed down in 1988 and 1989, following the droughts that wracked the country during that period, and were accompaniedby a decline in the money market rate.
The Tunisian authorities are determined to purs.,ethe interest rate adjustment policy with a view to attaining Loan Agreement objectives and to bringing the policy into line with the current economic and financial reform program.
3. World Bank PerformanceDuring the Prolect
In order to assist BRA in carrying out the project under good conditions, the Bank spared no effort in smoothing over certain difficultiesthat arose during the project.
In this connection, various supervision missions were made to Tunisia by Bank officials involved in the project to make contact with BHA and the various ministries concerned to discuss and prepare action programs with BRA and the Government and to monitor the project.
The following are among the main actions that can be credited to the project:
(a) Better conditions for subloans
Following the 1988 and 1989 droughts, and to assist project beneficiaries in overcoming obstacles, at the request of BRA the Bank agreed to improve the terms for agricultural loans to low-income small-scale farmers in southern Tunisia and to lower the down-payment percentage temporarily to 5 percent (instead of 10 percent). This operation involved 2,000 beneficiaries. In addition, the down-paymentpercentage required for the - 26 -
purchase of tractors and spare parts was brought into line with the generally accepted average of 20 percent, instead of 30 percent minimum.
(b) Trawler financina As part of the privatizationof ONP and modernization of the fishing fleet, the Bank agreed to the financing of these two operations not initially envisaged in the project as followss
- the financing of ONP trawlers by private parties; - the financing of new trawlers, also by private parties; and
- refinancing of nine agro-industrialprojects. In order to encourage BRA in its efforts to identify, select, and evaluate bankable agro-industrialinvestments, which stagnatedduring the first years of the project, the Bank agreed to attribute nine large operations prefinanced by BHA to the project.
(c) Institutionalcomponent The Bank missions worked closely with the Government and BNA during the project, making suggestionsand recommendationsconcerning:
- the vigorous pursuit of the agriculturalcredit policy reform program to attain the objectives of fungibility of funds for financing agriculture,simplification and harmonization of lending procedures, and computerizationof BNA's lending process;
- reorganizationor eliminationof the current concept of "FOSDA credit" in order to make BRA accountable for the entire credit process;
- gradual adjustment of agriculturalinterest rates to the market rate in order to improve BRA's financial margin for agriculture;
- establishmentof a durable system for covering banking risks with the introduction of agricultural credit insurance and a review of the current calamity fund (much remains to be done in this regard);
- encouragements of BRA by the Government to increase its role in mobilizing its resources and in financing agriculture;
- preparationby BRA of the detailed 1992-96 agriculturalcredit program with technical assistance in methodology from the Bank;
- inclusion of the broad orientationsof the agriculturalcredit policy in the country's Eighth Economic and Social Development Plar.;
- analysis of BNA's overall financial profitability,which has been improvingsince 1991, and its agriculturalcredit operations (still - 27 -
running in the red), as well as the monitoring and auditing during the agreed period of the project. 4. Conclusion In general, the project achieved a maximum of the objectives regarding investments,increases in production,and higher income for credit beneficiaries, despite two difficult years of drought. Naturally, much remains to be done to consolidate the results and improve BNA's efficiency in a financialmarket that has become competitive and that requires agricultural credit to have its own dynamism. Project performance is due essentially tot
- ongoing and regular monitoring by BRA through its supervision and monitoring teams;
- a major contributionby the Government following the decisions it made in a timely fashion and conducive to the success of the project (FOSDA, interest rates, support for institutionalobjectives, BNT/BNDA merger);
- the decentralizationpolicy for agriculturaloperations followed by BHA, as BRA continues to grow stronger year after year;
- improvementin BNA structures through computerizationof BNA operations and strengtheningof its staff through adequate and continuing training programs. Moreover, in comparison to previous agricultural credit projects, the project is distinguishedby:
- its implementationon schedule without any extension;
- the large volume of loans made beyond the project, i.e., TD 3.4 million on November 30, 1991, financed from BNA's own resources, following the depletion of funds and closing of the IBRD line. This situation caused an urgent need for financing of agricultural credit, prompting BRA to establish a detailed program to obtain the necessary financingunder new agriculturalcredit lines. - 28 -
ANNEXI PROJECT COST Unit= TD1,000 Numberof subloans Cost Actual Projected ActualTD ProjectedTD I. PartA of the Proiect a- Small-and medlum-scale farmers 6.010 3.400 14. 15.400 - Agrioultureequipment 1,496 1,579 520 - Irrigationequipment 2,972 8,625 7,950 - Well/tanklmotorhousing 696 2,481 4,720 - Stable 32 84 670 - Cattle 437 1,482 1,150 - Sheep 200 284 230 - Bee-raising 117 197 I Forageproduction 60 - Planting 60 114 100 b- Large-scalefarmers 843 615 11,954 15.400 - Agricuftureequipment 444 7,600 10,970 - Irrigationequipment 150 1,660 780 - WelVttankimctorhousing 74 570 890 - Stable/hangar 17 78 990 - Cattle 19 93 1,430 - Sheep 36 309 240 - Forageproduction 1 2 100 - Bee-raising 3 15 . - Rabbitbreeding 1 3 . - Planting 63 1,150 * - Integratedprojects 35 474 * C . Cooperatives 209 160 5.496 4.800 - Agricultureequipment 162 4,570 4,300 - Irrigationequipment 22 313 . - WelVtanklmotorhousing 3 17 . - Stable/hangar 3 5 500 - Cattle 3 116 . -Sheep 8 85 . - Planting 5 119 . - Integratedprojects 3 271 d- Apro-industry 26 25 6.240 6.500 - Civil works 1,020 1,900 - Equipment 4,880 4,300 - Workingcapital 340 300 e - Fisheries 192 640 11.127 5.700 - Miscellaneousequipment for small-scaefishermen 105 1,157 } - Miscellaneousequipment } 5,700 for large-scalefishermen 35 1,960 - ONPtrawlers 29 4,027 - New trawlers 23 3,983 TOTALPART A OFTHE PROJECT 7.290 4.40 49.663 47.800
II. PartB of the Proiect - Software _1.498 3.500 GRANDTOTAL 51,161 51,300 LENDING BY YEAR
j...... 1987 1988 1989 1990 | 1991 [ TOTAL CATEGORY | No. Amount 1 [No. [ Amount nt No Amount N Amou AoAmount
Small-and medium- 56 95 1,506 1,737 1,744 2,619 1,525 scale farmers 3,048 1,179 2,338 6,010 9,837
LIage-scale farmets 142 1,140 142 1,298 170 1,275 180 2,070 209 2,539 843 8,322 Cooperatives 79 932 56 1,127 17 160 22 625 35 1,114 209 3,958 Ago-industry 1 136 - 2 168 25 3,181 8 883 36 4,369 Fisheries - 9 228 31 1,128 80 1,696 72 4,797 192 7,849
TOTAL 278 2,303 1,713 4,390 1,964 5,350 1,832 10,620 1 503 11,671 I729 34,334a)
(a) The amounts beyMd the project (ID 273 million,equivalent to US$30million) wer financed using BNA's own resourcs
M- - 30 -
ANNEXIII
DISBURSEMENTSBY YEAR Unit = US$'000
Year~ Projected Actual | Yea Amount Cumulative % Amount Cumulative % |
1988 5,000 5,000 16.7% 6,039 6,039 20 % 1989 7,000 12,000 40 % 6,853 11892 39.6% 1990 8,000 20,000 66.6% 4,467 16,359 54.5% 1991 7,000 27,000 90 % 13,641 30,000 100 % 1992 3,000 30,000 100 % '
TOTAL 30C_00 30,000
DISBURSEMENTSBY CATEGORY Unit - US$'000
Category Projacted Actual % a - Small-and medium-scale 8,000 8,090 + 1% farmers b - Large-scalefarmers 8,000 6,931 -13% o - Cooperatives 3,500 3,327 -5% d - Agro-industry 4,500 3,678 -18% e - Fisheries 3,500 6,370 +82% f Computerhardware 2,500 1,604 -36% TOTAL 30,000 30,000 BRA TRAIIING BUDGET
Activity 1987 1988 1989 1990 1991 No. | Cost inTD No. CostinWM No.j Costin¶TD No. Cr inTDj No.ID 1. Cou.se 183 115.741 195 130 172 183 195 178,943 213 113,635 - CPFB courses in Tunisia 159 94,738 165 100,762 147 151,798 - rI oune - Paris 21 20,463 166 136,SC4 170 55,430 - 27 29,575 22 30,683 Evening course in 3 540 24 41,644 36 56,735 3 540 3 540 accounting 5 735 7 1,470 2. Semnars 801 33,127 942 38.632 546 27,791 7 170 275 4L26 - In-house 731 19,152 836 18,068 454 - In Tunisia 67 11,340 87 1,993 124 13,539 97 14,090 89 240 - Overseas 3 15,640 74 14,927 137 436 9 6,474 3 20,262 811 9 2,197 14 3. Hostint of traines 20,754 45 Z044 54 6.55 75 8.631 3.968 466.040 4. Training of future 8 15.211 30 8.770 middle manarers - s 5713 11 4.871 S. Tsainina of nw 32 897 63 1.936 SS 3.9C6 recruited azents 16 481 64 388 6. In-house assistance 18 1.753 175 27.424 125 24.378 88 Not yet -Edito - - available -Off ceagnts 18 141 25,278 1,753 34 103 22,S94 68 2,146 22 1,784 20 7.Trainina Pnesonnel30 salaries 9 68.415 8 62.261 - & Interashin. and fesher cousrse 4 512 10 448 13 2.373 - 9. Introductionto 203 25421 comnters 119 776
TOTAL 1,098 220,415 1,301 246,642 1,248 347,043 558 243,495 816 166,966(1) (1) Mhee figures are prawislowa, as other ependitures still need to be added. AGRICULTURALCREDIT RECOVERY as of November 30, 1991
Funds % Risk Utilized Not Yet Due Arfears In Dispute Past Due Repayment % of Repay. BNT 100 444,916 51,552 30,618 3,586 393,364 359,160 91 SCM 0-5 28,829 1,230 11,762 27 27,599 15,810 IBRD/IDA 57 100 5,397 10 773 120 5,387 4,494 83 IBRD 1340 TUN 10-25 5,324 703 1,034 212 4,621 3,375 IBRD 1885 TUN 73 40-100 29,729 3,797 8,896 901 25,932 16,135 62 IBRD 2865 RUN 26,978 19,961 3,768 33 7,017 3,216 Farm 46 roads 25-100 401 8 91 2 393 300 76 Fssheries 270 TUN 50 877 19 383 183 858 292 Second 34 Fisheries Project 1746 25 9,539 2,562 6,406 - 6,977 571 8 OMVVM/OMIVAN 10-25 1,917 111 297 6 1,806 1,503 FSA 83 25 7,118 756 655 296 6,362 5,411 85 Bei Nebhana 25 808 - - 808 808 - - FMO - 2,450 1,343 442 1,107 665 60 BNDA grant and loan 25-100 173 78 16 9 95 70 74 FCM grant and loans 44 44 - FOSDA - - - - 162,618 62,313 45,988 6,203 100,305 48,114 48 FOSEP - 37,520 9,378 10,969 3,514 28,142 13,659 PAM 49 - 3,108 146 302 367 2,962 2,293 77 FADES - 609 238 158 - 371 213 FSPA 57 3 2 1 - 1 - - FSDR MAHDIA 2,904 2,252 471 21 652 160 PANO 25 3,162 2,127 463 - 1,035 572 55 Centml Tunisia 0-5 3,330 956 2,090 2,374 284 Syhvopastoral 12 0-40 2,533 254 1,262 - 2,279 1,017 45 SIDA 0-5 1,097 34 194 25 1,063 844 APMANE 79 (US-AID) 0-40 52,549 2,104 15,363 120 50,445 34,962 70 FIDA 0-40 14,567 1,966 6,599 16 12,601 5,986 FIDA SIDI 48 BOUZID I 0-40 640 242 375 - 398 23 FIDA SIDI BOUZID 6 II 985 [?1984 54 - 61 7 f?J11 FODERI 54,161 47,251 5,058 22 6,910 1,830 26 PDA KEF 3,102 2,973 117 - 129 12 PDRCF 9 56 40 13 16 3 19 ODS 2,946 2,839 93 107 Integrated 14 13 projets (DF) 126,410 106,356 14,191 - 20,054 5,863 Misxlaneous 29 3,335 422 1,169 96 2,913 1,648 57
TOTAL 1,040,135 324,991 170,071 16,567 715,144 528,506 74 Unit = TD:1000 33 -
ANNEXVI
RECOVERYRATES BY YEAR
FUNDS 1987 1988 1989 1990 1991 AVERAGE
BNA 94 92 93 90 91 92 SCM 44 57 70 64 57 58 IBRD/1IDA779263 TUN 86 84 83 83 83 84 IBRD1340 TUN 73 76 78 75 73 75 IBRD1885TUN 62 65 64 62 62 63 IBRD2865 TUN 68 54 47 46 54 Farm roads 72 78 78 75 76 76 Fisheries270 TUN 31 33 33 33 34 33 Fisheries1748TUN 4 4 5 7 8 6 OMWM/IMIVAN 77 78 86 85 83 82 FSA 84 85 85 85 85 85 Bel Nebhana 0 0 0 0 0 0 FMO 34 64 59 60 54 BNDAgrant and loans 0 11 29 74 29 FOSDA 54 53 57 50 48 52 FOSEP 56 59 56 52 49 54 PAM 59 64 60 81 77 68 FADES 67 63 59 57 57 61 FSDRMAHDIA 54 28 28 25 34 PANO 92 43 55 63 CentralTunisia 21 16 13 12 12 15 Sylvo-pastoral 62 66 85 47 45 61 SIDA 59 66 82 79 79 73 APMANE(US-AID) 76 82 82 71 70 76 FIDA 51 56 63 47 48 53 FIDASIDI BOUZIDI & II - 8 8 7 7 8 FODERI 26 28 27 30 26 27 PDA KEF - 18 9 14 PDRCF - 17 19 15 ODS . 25 12 13 17 Bhaierand Bechri F.D.zone . 29 29 Miscellaneous 74 78 77 57 57 69
Overallrecovery rate 78 79 e1 76 74 78 - 34 -
PART III: STATISTICAL INFORHATION
Table 1: Related Bank Loans and/or Credits
Year of Loan/Credit Title Purpose Approval Status First AgriculturalCredit To finance large- 1971 Completed Project scale farmers & semi- July 1978 (Loan 779/Credit 203-TUN) private companies Second Agricultural Credit Finance small-scale & 1976 Completed Project commercial farmers June 1983 (Loan 1340-TUN) and agro-industries Third Agricultural Credit Increase production 1980 Completed Project and incomes of small- Dec. 1986 (Loan 1885-TUN) and medium-scale farmers and improve credit operations
Table 2: Proiect Timetable
Item Date Planned Date Actual Identification 1985 1985 Preparation June/July 1986 June 1986 Appraisal Mission October 1986 November 1986 Negotiations April 1987 April 13-17, 1987 Board Presentation June 1987 July 7, 1987 Signing July 22, 1987 Effectiveness/! October 1987 January 22, 1988 Completion December 31, 1990 September 30,1991 Closing December 31, 1991 November 19, 1991 Last Disbursement December 1991 . November 19, 1991
Loan effectivenesswas delayed by three months to allow the Government to prepare legal documents. - 35 -
Table 3: Loan Disbursements
Cumulative Estimated and Actual Disbursements (US$ million)
Fiscal Year and Appraisal Actual Actual as Z of Semester Estimate Appraisal FY88 September 30, 1987 .00 .00 0 December 31, 1987 2.50 .00 0 March 31, 1988 3.70 3.70 100 June 30, 1988 5.00 3.70 74 FY89 September 30, 1988 6.70 4.80 72 December 31, 1988 8.40 6.00 71 March 31, 1989 10.29 8.10 79 June 30, 1989 12.00 8.10 68 FY90 September 30, 1989 14.00 9.50 68 December 31, 1989 16.00 11.90 74 March 31, 1990 18.00 14.12 75 June 30, 1990 20.00 14.12 70 FY91 September 30, 1990 21.80 16.36 74 December 31, 1990 23.60 18.85 80 March 31, 1991 25.30 21.35 84 June 30, 1991 27.00 26.00 96 FY92 September 30, 1991 28.50 27.13 90 December 31, 1991 30.00 30.00 100
Date of Final Disbursement: November 19, 1991 - 36 -
Table 3(a): ComRarisonbetween Appraisal and Actual Disbursements by Categorv of Disbursements (US$ million)
Actual as Z of Category Appraisal Actual Appraisal 1-a Subloans to small- and medium-scale farmers 8.0 8.1 101 1-b Subloans to large-scale farmers 8.0 6.9 87 1-c Subloans to cooperatives 3.5 3.3 95 1-d Subloans to agro-industries 4.5 3.7 82 1-e Subloans to fishermen 3.5 6.4 182 2 Institutionalcomponent 2.5 1.6 64 TOTAL 30.0 30.0 100 - 37 -
Table 3(b): BNA's Prolect-RelatedSubloan Commitments/!
1987 1988 1989 1990 1991 TOTAL ------TD Million ------Subloans to: Small- & medium-scale farmers 0.1 1.9 2.8 3.1 3.0 10.9 Large-scale farmers 1.5 1.9 2.1 2.6 3.6 11.7 Cooperatives 1.3 1.3 0.4 1.8 1.9 6.7 Agro-industry investors 0.4 0.2 1.8 3.5 1.9 7.8 Fishermen 0.1 0.6 1.8 9.9 1.6 14.0 Total Commitments 3.4 5.9 8.9 20.9 12.0 51.0 I per year 6.7 11.5 17.4 40.9 23.5 100
BNA's Project-RelatedSubloan Disbursements/s
1987 1988 1989 1990 1991 TOTAL ------TD Million ------Subloans disbursed for: Small- & medium-scale farmers 0.1 1.8 2.6 3.0 2.3 9.8 Large-scale farmers 1.2 1.3 1.3 2.1 2.4 8.3 Cooperatives 0.9 1.1 0.1 0.6 1.3 4.0 Agro-industry investors 0.1 - 0.2 3.2 0.9 4.4 Fishermen - 0.2 1.1 1.7 4.8 7.8 Total Disbursements 2.3 4.4 5.3 10.6 11.7 34.3 Z per year 6.7 12.8 15.5 30.9 34.1 100
Excludes, consequently, sub-borrowers and Government contribution to subproject investment cost. - 38 -
Table 3(c): BNA's Project-RelatedSubloans at Year-End and Cumulative
1987 1988 1989 1990 1991 TOTAL Number of subloans granted 337 1841 2072 1950 1806 8006 BRA Commitments (TD Million) 3.4 5.9 8.9 20.9 12.0 51.1 BHA Disbursements (TD Million) 2.3 4.4 5.3 10.6 11.7 34.3 IBRD Disbursements/! - 6.0 4.3 4.5 13.6 28.4 ($ Million)
'A From FY88 to FY92 on the basis of 75% of amounts disbursed by BRA under such loans.
Table 3(d): Prolect Lending Program: Medium- and Long-Term Credit
Average Unit Cost Total of Investment No. of Million Million Cost in TD sub-projects (TD) (US$) Small- & medium- scale farmers 2,470 6,010 14.8 16.3 30 Large-scale farmers 14,180 843 12.0 13.2 24 Cooperatives 26,300 209 5.5 6.1 11 Agro-industry investors 173,330 36 6.2 6.8 12 Fishermen - Engine renewal) - Fishing gear } 57,950 192 11.2 12.2 23 Total Cost 49.6 54.6 100 Less: Sub-borrowers contribution 11.9 13.1 Government special resources 3.4 3.7 Total medium- and lone-term credit proram 34.3 37.8 - 39 -
Project Implementation: Key Performance Indicators
Table 4(a): BNA's Loan Recoverv 1987-91 for AgriculturalLending and Risk Assumed
Recoverl Rate (on 2rincipal)/ Sources Risk Assumed by BRA 1987 1988 1989 1990 1991 Average …-… ------(X) …------BRA own resources 100 94 92 93 90 91 92 Socift6s de Caution Mutuelle (SCMAs) 0-5 44 57 70 64 57 58 IBRD Loans 100/ 74 73 70 67 66 70 FOSDA/FOSEP 0 54 53 57 50 48 52 Supervised projects 0-40 21-76 8-82 8-85 7-79 7-79 10-79 BNA's average recovery rate 0 78 79 81 76 74 78 Rate at end of CY, after payment of interest due. /b JUnderthe second loan, risk assumed by BNT was 10-25Z; under the third loan, it was 40-100.
Table 4(b): Financial Ratios (See Table 8(b), page 51) _ 40 -
Table 5(a): Proiect Costs (US$ million)
Appraisal Estimates Actual Cost Local Foreign Total Local Foreign Total Medium- and long-term credit 27.5 27.5 55.0 27.2 28.4 54.6 Private farmers 19.0 16.4 34.5 14.5 15.0 29.5 Cooperatives 2.2 3.3 5.5 2.8 3.3 6.1 Agro-industries 3.0 4.5 7.5 3.1 3.7 6.8 Private fishermen 3.3 3.3 6.6 6.8 6.4 12.2 Institutional develoDment 1.5 2.5 4.0 0.4 4.0 4.411 Computer software & hardware 1.05 2.25 3.3 0.4 3.7 4.1 Training 0.4 0.1 0.5 - - - Consultants & specialists 0.05 0.15 0.2 - 0.3 0.3 Total Prolect Cost 29.0 30.0 59.0 27.6 32.4 59.0
Out of which US$2.2 million equivalent was financed by an EEC grant after BNT/BNDA merger: mainframe computer (2.0) and organization consultants (0.2).
Table 5(b): Proiect Financing (US$ million)
Planned Loan Actual/Planned Source Agreement Actual z IBRD 30.0 30.0 100 BNA 17.0 13.7 81 a) Omn funds (12.7) (10.0) (79) b) Government (4.3) (3.7) (86) Sub-borrowers 12.0 13.1 109 EEC 0.0 2.2 - TOTAL 59.0 59.0 100 - 41 -
Table 6: Statue of Covenante
Deadlinefor Covenant SubJect Compliance Status
- LoanAgreement Sec.4.02 BNAto furnishaudit report each June30 OK. Supptiedon time year. eachyear eachyear. Sec.4.03 BNAto furnishincome statements yearly OK andanalysis of creditoperations. Sch.4 BNAto adjustinterest rates from 1991 Adjustmentdone in PartA 11 timeto timeto reachmarket 1987,1990. and1991'. (a) rates. Sch.4 BNAto setup an efficient 6/90 OK. MIShas been set PartB organizationand HIS up inbranch office (a)(i) network. Sch.4 BNAto establisha computer 9/87 OK b) Ci) managingcommittee Sch.4 SNAto preparean annualtraining 3/88 Doneevery year PartB programbeginning with 3/88 Cb) Cii) - GuaranteeAgreement Sec. 3.02Cc) Govermentof Tunisia to (i)cause 1991 Done in 987, 1990, agriculturalrates to be adjusted, and 19911. inconsultation with Bank, to reachrates equal to marketrates, and(ii) reduce its budgetary allocationsto agriculturalcredit financing. Sec.3.03 Governmentto establishan 12/87 OK AgriculturalCredit Coordinating Committee. I! Considerableprogress was made under the project but further revisions inagricultural interest rates areneeded to reachmarket rates. - 42 -
Table 7(a)s USE OF BANK RESOURCES A. Staff Innuts'A (staff weeks)
Stages of Project Cycle FY85 FY86 FY87 FY88 FY89 FY90 FY91 FY92 Total
Pro-appraisal 1.2 33.2 37.0 1.0 - - - - 72.4
Appraisal - - 23.4 - - - - - 23.4
Negotiations - - 4.9 .9 - - - - 5.8 Supervision - - - 6.3 4.3 10.0 10.0 2.2 32.8 TOTAL 1.2 33.2 65.3 8.2 4.3 10.0 10.0 2.2 134.4
This information comes from the Bank MIS; it may not be fully consistentwith Mission Data compiled from files. - 43 -
Table 7(b): E. Missions
Mission Date No. of DaysJn SpeciaLizat[ons Perforpwnce Typesof (m/y) Persons Field1 Represented- Rating' Problem Throush Acoraisal Identification/ Preparation 9/85 2 19 FA,ACS Preparation 12/85 1 21 FA Preparation 4/86 1 14 FA Pre-Appraisal 6/86 7 21 FA,ACS,DS,RS, TMS,MIS,CB Aeraisat througn Effectiveness Appraisal 11/86 6 14 FA,E,CB,ACS,TNS Post-Appraisal 3/87 1 7 FA
Subtotal 18 96 ProlectInMlementation Supervision 1 12/87 1 7 FA 1 Loan effectiveness Supervision 2 4/88 1 14 FA 2 Drought Special SJdJon policy 1/89 3 7 FA,ACS 2 Policy reform reforms- Supervision3 9/89 1 7 FA 2 Drought Supervision 4 12/89 1 14 FA 2 Mergerof BNT/BNDA Supervision 5 7/90 2 7 FA,ACS 2 Funglbility of funds Supervision6 6/91 2 14 FA,ACS 2 BNA PCRpreparation 2/92 2 8 FA,ACS 2 reorganization Subtotal 13 78 Man/daysin field include time spent on supervising other projects. /b E = Economist;FA = Financial Analyst; ACS= Agricultural Credit Specialist; DS DiscountingSpecialist; TMS- Training and Monitoring Specialist; RS= Rural Savings;MIS = MISand EDPSystems; Co = Commercial Banking. Status Rating: I = problemfree or minor problem; 2 a moderateproblem; 3 a major problem- appropriate actions are being taken to moderatethese problems;4 = major problems- they are not being addressed adequately. /d International donorsmeeting on the policy and institutional reforms. - 44 -
Table 8(a): BNA's Financial Position - Summary of Balance Sheets 1987-1991 as ot December31 (TD'000)
1987 1988 1989 1990 1991 Assets Cashand banks 33,538 190,097 340,922 220,654 232,840 Bills dIsoounted 113,402 327,052 440,837 726,720 897,483 Short-termloans and advance* 222,246 224,936 214,741 189,243 284,785 Term loans 206,063 247.315 339.49S 390.191 440.930 Subtotalnormal risk assets 548,656 937,464 1,144,101 1,495,802 1,796,038
Governmentbonds and securities 124,907 132,210 141,453 150,203 110,829 Equity participations 15,142 25,110 25,110 27,627 30,058 Other assets 353,569 242,114 274,598 315,253 320,611 Net fixed assets 10,284 13.006 20.9 24.909 28.509 TOTALASSETS 1,086,096 1,540,001 1,947,074 2,234,448 2,551,710 Liablilties Centralbank, M. market 260,404 436,779 564,141 740,555 DemandDeposits 431,070 356,732 311,798 293,565 315,473 Term deposits 126,251 328,363 392,690 434,752 455,029 Banks& correspondents 27,849 11,237 18,742 20,322 13,133 Other creditors 12,672 10,607 37.450 53,574 72.729 Subtotal 597,842 967,343 1,197,459 1,366,354 1,596,919
Specialfunds/A 195,319 224,021 310,377 356,116 403,582 Long-termbonds 100 25,000 45,291 47,483 Provisionfor bad debts 44,094 49,194 60,895 67,355 73,251 Other liabilities 194.882 247,32 274.456 316 344.765 TOTALUABILITIES 1,032,137 1,487,979 1,868,187 2,151,479 2,465,921 Equitv Capital 23,000 23,000 33,000 33,000 33,000 Reserves 30,959 29,022 45,887 49,970 52,789 SubtotalEquity 53.959 52.022 78.887 _82970 85.789 TOTALLIABILUTIES AND EQUITY 1,086,096 1,5 0,001 1,947,074 2,234,449 2,o51,710 Off-BalanceSheet Total 656,166 812,784 995,665 951,506 1,348,932
/af FOSDA,FOSEP, IBRD-IDA and Others. k Increasedto 55,000as of March 1, 1992 - 45 -
Table 8(b): BNA's Financial Position - Income Statements. 1987-1991 as of December31 (TD'000)
1987 1988 1989 1990 1991 Income InterestIncome On loans 63,186 64,315 72,875 90,846 119,111 On deposits 6,706 9,960 39,744 Other 31,964 24,075 1^299 6,998 11.413 30.198 43.778 Subtotal 71,191 81.273 124,032 153.008 186,964 Other Income 808 4.173 3. 582 TOTALINCOME 77,210 82,081 128,081 156,847 190,546 Expenses Interestexpense 20,827 16,951 42,708 48,053 59,954 On deposits 18,094 25,315 On borrowings 43,343 51,380 66,984 4.316 4.114 4.763 11.883 14,294 Subtotal 43,237 46,380 90,814 111,216 141,232 Personnel 12,223 13,626 16,124 18,103 20,737 Other operatingexpenses 5,221 9,140 6,909 R,eorvefor bad debts 7,253 7,157 85355 S.100 6.888 11 9.479 TOTALEXPENSES 70,248 75,570 122,036 148,739 180,476 Pre-Tax Income 6,962 6,511 6,169 Incometax 8,108 10,070 1.890 904 1,258 2,401 NET INCOME 5,072 5,607 6,169 6,850 7,669 Allocation Dividends 1,900 2,300 3,300 Director'sfees 3,630 3,752 25 25 25 35 39 Soclal AssistanceFund 700 800 Legal reserve 850 1,000 1,150 343 383 Reserves 921 445 524 Balancecarried forward 110 828 46 84 54 87 s8 FinancialRatios (in %) Debt/Equity 19.13 28.60 23.68 Risk 25.93 26.10 assets/Coredeposits .98 1.37 1.62 Equity/Riskassets 2.05 2.33 9.83 5.55 6.90 5.55 Provisionsas % of total 6.00 Risk assets'! 3.66 2.81 2.85 2.94 2.43 ProfitabilitvRatios (in %) GrossIncome/Total assets 7.11 5.33 6.58 7.02 7.48 Resourcecost 4.38 3.22 Financial 5.02 5.34 5.40 margin/Riskassets 6.19 3.81 3.27 Operating cost/Total 3.04 3.05 assets 2.49 1.90 1.60 1.73 Returnon equity (beforetaxes) 1.75 12.90 1252 7.82 8.26 9.34
D5Defined as loans outstandingplus guaranteesand acceptance(off-balanoe sheet). 4k After capitalincrease decided at the end of 1991. 8' 90 10'
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