RESTRICTED Report No. TO-618

Public Disclosure Authorized This report was prepared for use within the Bank and its affiliated organizations. They do not accept responsibility for its accuracy or completeness. The report may not be published nor may it be quoted as representing their views.

INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION Public Disclosure Authorized

MEMORANDUM ON

REVIEW OF AGRICULTURAL PROJECTS AND PROGRAMS

TUNISIA Public Disclosure Authorized

December 28, 1967 Public Disclosure Authorized

Projects Department CURRENCY EQUIVALENTS

Since September 28, 1964

1 dinar = $1. 905 1 U.S. dollar = D 0. 525 1 million dinars = U.S. $1, 905, 000 1 million U. S. dollars = D 525, 000 TABLE OF CONTENTS

Page No.

SUMMARY AND CONCLUSIONS ...... 1 - v

I. Introduction ...... 1

II. The Agricultural Sector in Tunisia's Economy ...... 2

III. Recent Performance by the Agricultural Sector ...... 8

IV. Review of Projects ...... 11

A. Irrigation Projects (On--Going) ...... 13

B. Irrigation Projects (Proposed) ...... 16

C. Agricultural Projects (On-Going) ...... 18

D. Agricultural Projects (Proposed) ...... 20

E. Forestry Project (On-Going) ...... 21

F. Forestry Project (Proposed) ...... 22

G. Fishery Project (Proposed) ...... 23

H. Summary of Project Review ...... 23

V. Technical Assistance Requirements ...... 24

A. Planning and Project Preparation ...... 24

B. Research ...... 26

C. Extension and Training ...... 27

VI. AgricJl.tural Inputs ...... 29

Tables: Production of Major Crops

Fertilizer Imports

Estimates of Phosphatic Fertilizer Use

List of Agricultural Projects

Acreage and Investment Costs of On-Going Irrigation Projects

Estimates of Additional Agricultural Staff Requirements by 1971

Mission Suggestions on Project Priorities

Map: Economic Map of Tunisia ANME,ES

1. Lower Medjerda Irrigation Development

2. Irrigation Projects - On-going

3. Irrigation Projects - Proposed

4. Agricultural Projects - On-going

5. Agricultural Projects - Proposed

6. Forestry Project - On-going

7. Forestry - Proposed

8. Fishery Project - Proposed

9. Estimates of Bilateral Assistance to Tunisia

10. Terms of Reference BEVIEW OF AGRICULTURAL PROJECTS AND PROGRAMS

TUNISIA

SUMMARY AND CONCLUSIONS

i. In order to provide basic information for the meeting of a special Working Party on Agriculture established by the Consultative Group for Tunisia, a review of Tunisia's agricultural projects and programs has been prepared by an IBRD mission which visited Tunisia in late August and September 1967. The review is intended to assist the Working Party focus on the priorities and inter-related needs of the agricultural sector in a more detailed way than has been done in the past, and in being prefaced for this particular purpose it was not intended to provide any comprehensive sectoral study or detailed assessment or preparation of projects. The review which has resulted is therefore presented as a working memorandum to be used as the basis for discussions, rather than as a more thorough-going study of agri- cultural development in Tunisia.

ii. Because of its importance to the economy, agriculture receives prominent attention in the Tunisian Plan Quadriennal, 1965-1968, and in recent years the agricultural sector has been receiving allocations of resources roughly commensurate with the relative contribution it makes to the Gross Domestic Product. Despite the efforts made to carry out agriculture plans and programs, the sector has not shown significant growth. Adverse weather conditions have caused large fluctuations in annual production, but in addition to this there has been little improve- ment in the quantities of modern agricultural inputs which Tunisia's farmers have employed. Fertilizers, mechanized cultivation, pesticides, and improved husbandry techniques all appear to have remained at levels which have changed very little. Several factors have contributed to cause this, but an important one has been a pervasive lack of experienced farm managers to stimulate and guide the mass of traditional farmers in new production methods and the use of modern inputs.

iii. It is against this background that the review has sought to examine available projects for the purpose of identifying rough orders of priority, with potential attractiveness for foreign financing primarily in mind. The Government presented a total of 23 projects for examination, a large number of which deal with irrigation because a project approach has been applied more frequently in this sub-sector than in the others. Because projects constitute the most tangible building blocks in a development program, and as such would be of major interest to the Working Party, they have been the element of most emphasized in the review. Not all development activities are reflected in the projects, however, and for this reason the review also attempts to examine other areas and other means by which outside assistance might be utilized to promote development. These are included in the somewhat shorter treatment of technical assist- ance requirements and program aid to provide agricultural inputs. The major conclusions concerning projects and programs are summarized in the paragraphs which follow. - ii -

iv. Turning first to the projects, a number of possible develop- ments concern the region of the Oued Medjerda, which is the largest potential source of surface irrigation in the country. Major steps have already been talken to develop the region of the Lower Medjerda, where work is under the direction of the semi-autonomous Office de la Mise en Valeur de la Vallee de la Medjerda (OMVVM). Exploratory studies have also been undertaken in parts of the middle and upper reaches of the Oued Medjerda, and on tributaries leading into the main river. Since developments in one part of the Medjerda Basin could have adverse effects on future agricultural development in other regions of the Basin, the first recommendation calls for a comprehensive study of the Basin as a whole in order to determine the most economic use of the water resources which are available there. It does not seem desirable to delay further work in the OMVVM area until the Basin-wide study is completed, but any additional work there would have to be limited to that which is safe to do in light of the uncertainties about future development. The review therefore recommends that an IBRD mission be sent at an early date to analyze the extensive data already available and define and appraise a suitable project for possible IBRD lending. The same mission could also prepare terms of reference for the longer-term study of the Basin. v. There are also eight on-going irrigation projects expected to be completed by 1968 or 1969. All but one of these projects (e.g., Oued Chiba) are already receiving foreign assistance. With the exception of two projects which rely on groundwater supplies, all on-going projects have very high estimated costs per hectare. Despite this, it would be desirable to complete these projects as rapidly as possible because they are so well-advanced in the construction stage. Additions to irrigated acreage from these projects total slightly more than 30,000 hectares. vi. Among six irrigation projects proposed for future development, three are located in the upper reaches of the Oued Medjerda, and would therefore become part of the Basin-wide study recommended earlier. A fourth project, which proposes to rehabilitate the irrigated agriculture of the oases in the Southern part of the country, is interesting because of the possibilities there to raise early fruits and vegetables for export. Further study of the hydrologic and economic aspects is required, but as presently conceived the project merits a high priority so that project preparations can be completed soon. vii. Two proposed water projects -- Lake Ichkeul (irrigation) and Oued Zeroud (flood control) -- have been given lower priority, largely on the basis of the economic evaluations indicated by the studies made to date. The Lake Ichkeul project, however, is complicated by the fact that it has multi-purpose objectives, and is potentially linked with developments in the Medjerda Basin. viii. There are two on-going projects falling in the broad category of agriculture, and both involve cooperative development. One is a project to form Production Cooperatives (UCP) in the Northern Region, which is being financed by the IBRD and IDA. This financing is to provide a variety of agricultural inputs needed to alter the present cropping patterns, largely by adding a livestock component to replace the fallow period which currently follows cereal crops. The project will also introduce some limited irrigation activity on the cooperatives. Technical assistance to the cooperative program will come from a Bureau of Control, especially established for this purpose, and staffed by Tunisian and expatriate tech- nical personnel. This project has been given a high priority because it can provide a good test of the viability of this type of cooperative approach to agricultural development in Tunisia, it has substantial foreign assist- ance already, and the lessons derived from exDerience under it will provide invaluable guides for future projects of this kind. ix. The second on-going agricultural project is a Polycultural Coop- erative located in the Central Region. Cooperative units under this project would be established to provide more controlled and assured grazing facilities for livestock through the introduction of limited irrigation and reserve forage areas, in addition to providing certain service and ectension functions. This project has been given a somewhat lower priority, largely because it is less well-advanced than the Production Cooperatives project, and because experienced farm managerial personnel remain scarce. Cooperative projects are unavoidably in competition for such scarce services, and under these circumstances the relative priority has been given to the better financed and better organized Production Coop- eratives of the Northern Region. x. In addition to the two on-going projects in agriculture, the Government has provided project descriptions for three proposed projects -- a cooperative project which would be an expansion of the Production Cooperative project which is on-going (and described above), a Service Cooperative for the Sahel region, and a technical assistance project (submitted for UNDP assistance) to train cooperators and cooperative managers, and provide planning help for cooperatives in the Central region. A fourth proposed project, for a service Cooperative to be located in the Northern Region, is under preparation, but details were not yet available. xi. The technical assistance project merits a high priority because it would be directed toward overcoming the lack of practical managerial experience, and as such fills a very critical need in the agricultural sector. The remaining cooperative projects have been placed in the category of a second priority, mainly for the reasons advanced in the case of the on-going polycultural Cooperative project in the Central Region -- i.e., the existing scarcity of experienced managerial and supervisory personnel for cooperatives will limit the rate at which new cooperative projects can proceed. Where a choice of this kind has to be made, it seems preferable to restrain the implementation of new projects, or in the case of the Polycultural Cooperative project one vhich is barely started, in order to ensure adequate leadership for the on-going Production Cooperative (UCP) project. As experienced personnel become available in large numbers, this restraint should be eased. - iv -

xii. Two forestry projects were presented by the Government -- one proposed (Forest Exploitation), and one on-going (Reafforestation). The Reafforestation project is a plantation scheme for production of pulp to be used in paper manufacture, and is expected to include 40,000 hectares by 1975. Further economic studies are required to resolve questions about its ultimate economic contribution. The Forest Exploitation scheme would exploit timber areas already grown, and is more promising on the basis of present information. A study of the project's technical and economic justification should receive high priority.

xiii. A fisheries project to modernize the coastal fishing fleet has been drawn up. While there appears to be a basis for assuming that coastal fisheries can be utilized to increase domestic food sources and provide export earnings, the project requires considerable preparatory work before it could be considered for external financing. On the basis of this state of readiness for implementation, it has been ranked below projects in the first priority.

xiv. In looking beyond the available projects, the review has attempted a general examination of technical assistance efforts and requirements. One important activity requiring assistance is in the preparation of projects particularly in the economic evaluations. This need became clear in the course of reviewing the projects which were presented for consideration. Besides project preparation in the narrow sense, technical assistance could help to improve overall planning activities, and thus bring benefits in terms of better coordination of development programs as well as better bases from which to attract foreign assistance.

xv. A number of important research problems require attention -- irrigation agronomy, sugar beet production, and improved forages among others -- and technical assistance for research should reduce the time required to obtain useful results to be implemented under the agricultural programs. The review does not contain any estimates of research needs, but the importance of research to increase productivity makes it vital that this activity receive adequate support.

xvi. The review makes frequent reference to the critical constraint imposed by the shortage of experienced managerial and supervisory personnel to direct the cooperatives and work with farmers in the traditional sector. The Government has begun to take steps to reduce this constraint, but helping to remove this inexperience offers wide opportunities for technical assistance from abroad in matters such as management, equipment maintenance, improved husbandry techniques, and livestock care. The training of extension per- sonnel, and the eventual field work of those who would be trained, could also benefit from more and better equipment for practical demonstrations, and more transport facilities to increase the mobility of field staff. xvii. Because technical assistance activities tend to cut across the entire range of agricultural interests, and receive support from a variety of sources, it is difficult to coordinate them effectively. A more rational and economic use of technical assistance resources would probably result from a thorough study at this time of the needs and availabilities. xviii. Foreign exchange is required to maintain a flow of modern agricultural inputs, and commodity loans and project aid currently provide an important component of input needs. It is not clear whether a lack of foreign exchange is responsible for inhibiting the growth of input use in any respect, but as standards of husbandry rise the demand for modern inputs should rise correspondingly. This assumes that the structure of incentives to agriculture will encourage the use of modern inputs. As this occurs, lack of foreign exchange should not be allowed to become a bottle- neck restricting use of inputs. RDVEIWT OF AGRICULTURAQ PROJECTS AND PROGRM24S

TUNISIA

I. INTRODUCTION

1.01 The Consultative Group for Tunisia recently established a Working Party on Agriculture to consider various aspects of the agri- cultural sector of the Tunisian economy. The Consultative Group also requested the IBRD to review the Tunisian agricultural sector programs and projects, and to submit a report on that review to the Working Party. This review would provide a basis for discussions to be held by the Working Party sometime prior to a meeting of the full Consultative Group scheduled for early 1968. The report which follows contains the findings and views of an IBRD mission sent in response to that request. Members of the mission were in Tunisia from August 24 to September 27, 1967, and included Messrs. J.B. Hendry, P.Z. Kirpich, H. Kordik, C. Brochu (FAO), and C. McMeekan (Consultant).

1.02 The appointment of a Working Party to deal specifically with a single sector -- in this case the agricultural sector -- is a new and experimental step for the Consultative Group. It results from a desire to focus the Consultative Group's attention on the priorities and inter- related needs of a sector in a more detailed way than has been done in the past, and thereby determine whether this approach fosters a more effective coordination of the financial assistance offered by member countries of the Consultative Group. For its part, the Bank mission was asked to examine the Tunisian Government's program for agricultural development and the projects which form a part of that program, and to offer suggestions on project priorities and the requirements for both technical assistance and the supply of agricultural inputs. The complete terms of reference for the mission are attached hereto as Annex 10.

1.03 The main body of the report starts with a brief description of the background for agricultural development in Tunisia and a summary view of recent sectoral performance. This is followed by discussion of the agricultural projects which have been prepared by the Government, some estimates of technical assistance requirements, and a review of the supply situation for agricultural inputs. Project descriptions, with somewhat more detail than given in the main part of the report, are provided in Annexes 1 through 8.

1.04 The description of project possibilities and future developmental prospects in the Basin of the Oued Medjerda is presented more fully than the other projects because the Basin provides the single most important surface irrigation opportunity in the country. Substantial investments in irrigation and flood control have already been made in the valley of the Lower Medjerda, and technical studies covering potential continuations of these works have been carried out. The Basin as a whole, however, presents several complicated problems which are discussed in both the main report and in Annex 1. - 2 -

1.05 Annex 9 summarizes the types of foreign assistance made avail- able to Tunisia in two recent years (i.e., in 1965 and 1966). This annex shows (by country) the amounts available in loans and credits, the amounts available in forms other than loans and credits, and the numbers of expatriate personnel working in the agricultural sector.

II. THE AGRICULTURAL SECTOR IN TUNISIA'S ECONOMCY

2.01 Under any of the usual criteria, agriculture makes an important contribution to Tunisia's economic well-being. Although not blessed with a rich endowment of natural resources suited to a highly productive agri- culture, the agricultural sector has been providing a substantial base for the national economy. Slightly more than half the working population is employed in agriculture, and thus directly affected by either improve- ment or deterioration in sectoral performance. Agricultural produce is also currently providing nearly half of the total value of exports of Tunisian merchandise, or about one-third if the total export values of both goods and services are combined. The agricultural proportion of Gross Domestic Product (GDP) has averaged 21 percent on an adjusted trend basis over the period 1962-1966, and this proportion rises to 27.5 percent if the contribution of food industries is added to that of agriculture. Finally, investments in Tunisian agriculture have been taking place at a rate of about one-fifth of all investment.

2.02 Government estimates currently place the area considered agri- culturally productive at around 9 million hectares, or a bit more than half the total area of the country. In turn, only half of this (4.5 million hectares) is arable land. Another 40 percent (3.6 million hectares) is in range land and esparto grass, and the remaining 10 per- cent (0.9 million hectares) is forest land. The pattern of rainfall in Tunisia is such that it is adequate to support a highly productive agriculture in only a relatively small part of the country along the northern coastal portion, while a major part of the total area of the country lies witlhin arid or semi-arid zones. The combination of rain- fall and topographical features in Tunisia permits one to identify at least six different agricultural regions:

(a) The region of Tunis and Cap Bon -- richest agricultural region, in the Northeastern part of the country, with good soil and rainfall that varies between 400 and 600 mm annually. Production is diversified, and includes citrus, vegetables, wine grapes, and dairy products.

(b) The plains of Northern Tunisia -- the second richest agricultural area, with variable rainfall in the range of 400 to 600 mm annually. The region includes part of the Medjerda Basin and the hills along the Tell. Major agricultural production is in cereals, with some livestock as well. (c) The mountainous area of Kroumirie and Mogods -- a watershed area of the Oued Medjerda with valuable forest resources, and the drier areas of the Tell mountains which are partly cultivated. Future prospects appear best if development can be generated in forestry production and forest grazing.

(d) The Sahel region -- a region stretching along the eastern coast from Cap Bon to Zarzis, with low rain- fall of 200 to 300 mm annually. It is an important area for olive production, some almonds, and some rainfed cereals. Coastal oases in the southern portion produce dates.

(e) The central region -- a semi-arid steppe region largely used for grazing sheep. Olive production has been growing in recent years, and esparto grass grown here is being used for paper production in a factory located at Kasserine.

(f) The southern desert region -- an arid area where agri- cultural opportunities are limited to the scattered oases which produce dates, vegetables, and some grazing for camels and goats.

2.03 Tunisia's major agricultural export commodity is olive oil, and Tunisia is, in fact, the world's second largest exporter of olive oil. Former preferential market opportunities for wine exports to France were terminated in 1964, reducing the degree to which continued reliance could be placed on finding export outlets for wine, but France opened a small quota again in 1966 and some exports were moving to Africa and Europe in 1966 and 1967. Tunisia has exported hard wheat in the past because this commodity commanded a premium over soft wheat in world markets, and the Tunisian qualities are well-known and well-accepted in some importing countries. Since Tunisia has not been self-sufficient in cereal product- ion, the export of hard wheat has required equLivalent imports of soft wheat, plus whatever additional quantities were necessary to meet domestic needs in particular years. Exports of citrus have shown a rising trend in recent years, with oranges enjoying a favored position in European markets because of consumer preferences for the particular variety grown in Tunisia. There has also been some export of vegetables, but the main advantage of this export crop rests with the limited areas which can produce early-maturing varieties. Exports of animal and vegetal origin tended to fluctuate betwreen 30 and 36 million dinars during the year 1962-1965.

2.04 Despite the export contribution of agriculture, it should be noted that Tunisia also imports agricultural products in substantial amounts. Imports of soya bean oil, grains, and other foodstuffs totalled D 24.5 million in 1966. This was admittedly a poor crop year, and the import of foodgrains was particularly heavy, but agricultural products did constitute about one-fifth of all imports for that year. Other than food- ,grains and oil, important categories of agricultural imports for the same year included approximately D 2 million of dairy products and nearly D 3 r-d1lion for suga; and sugar produ.cts. - 4 -

2.05 Given the importance of agriculture to the Tunisian economy, and to the large proportion of the population directly dependent on farming, it is not surprising that the sector has received considerable attention in the Government's planning efforts. The basic planning document is currently the Plan Quadriennal (referred to hereinafter as the "Plan"), which covers the period 1965-1968 and was originally drawn up in the context of a perspective plan covering the ten-year period 1961-1971. One of the three volumes making up the Plan (Volume II) is devoted to the agricultural sector, which is further divided into nine sub-sectors, or chapters in the Plan document: Forestry, Conservation of Water and Soils (CES), Agricultural Hydraulics, Major Crops (e.g., cereals, legumes), Tree Crops, Market Vegetables, Live- stock and Forage Production, Support Activities, (Research, Extension, and Technical Studies), and Fisheries. In general terms, the Plan contains estimates of current (i.e., pre-Plan) crop production and cultivated area, crop production targets to be achieved by certain years (by region), estimates of total costs and value to be added by development, overall changes in the areas given to different crops, references to studies carried out or intended, changes to be made in cropping methods, and estimates of input needs. With the exception of the section dealing with Agricultural Hydraulics, the Plan is not broken down further into specific projects. In other words, while the goals of developmental efforts are given in the Plan, there is no reference to the year-by-year, project-by-project details which would bring achievement of the goals. It is also difficult to determine the extent to which some of the targets may be mutually exclusive because the total requirements are not summed up, either by year or Plan period. Since scarce resources (and particularly experienced technical personnel) are probably not sufficient to carry out all the proposed programs at the estimated rate of implementation, this is a serious deficiency when attempting to estimate the effectiveness of the Plan.

2.06 The targets which have been set, and the methods which have been used to achieve them, reflect some of the major considerations which Government planners have had uppermost in mind. A brief listing of several of them indicates something of the strategy for agricultural development which is being pursued:

(a) The Government would like to make the cooperative form of organization the pre-eminent agricultural institution in Tunisia, but the type of cooperative to be established is being tailored to meet differing circumstances. For example, Production Cooperatives (UCP) are being formed in the Northern Region, where they will replace the farm units formerly owned by French and Italian colons. Land reform objectives call for transfer of these lands to farmers from the traditional sector. Instead of distri- buting this land in small individual plots, however, the Government is providing new owners with shares in the Production Cooperatives. It is expected that the cooperative units will operate as single large-scale farms, essentially retaining the production methods and scale of operation typical of the colon farms before. - 5 -

A different type of cooperative, the Polycutural Cooperative, is being installed in the Central Region. Agricultural and land-ownership conditions there are quite unlike the North. The Polycultural Cooperatives are designed to operate as a single large unit to promote rotational grazing of livestock, instead of the scattered, uncoordinated over-grazing as at present. They would also have a small irrigated area for each, where reserves of pasturage could be grown for use in dry years. Livestock and olive trees would remain privately owned on these cooperatives. Cooper- atives to be formed in the oases of the arid Southern Region would attempt to rationalize land use in the small irrigated areas, and in some cases would try to increase the local employment opportunities. Finally, there are to be Service Cooperatives. These are being established to provide marketing services, credit, and agricultural inputs to medium and large scale private farms. Service Cooperatives may also be organized around common activities on private farms, such as irrigation or olive growing.

(b) Whatever the social and other non-economic objectives to be accomplished through an emphasis on cooperatives, this particular institutional form also offers certain advantages in promoting agricultural development. For one thing, it retains a scale of operation which has apparently worked well under colon management - especially true in the case of the UCPs in the Northern Region. Secondly, in theory Cooperatives offer a means by which extension staff can more readily introduce modern farming practices and techniques to traditional agriculturists, since the cooperative members are under the direction of cooperative managers who are expected to work closely with extension personnel. Service Cooperatives are designed to help private farmers obtain necessary agricultural inputs such as fertilizers, pesticides, and farm machinery (through rental of machinery services), and this would also work toward increasing agricultural productivity. Cooperatives of all the different types are thus regarded as institutions through which productivity-promoting activities can be channeled readily -- more efficient in this respect than would be attempts to increase the productivity of a traditional agriculturist population scattered on small- scale farms or conducting unrestricted grazing on the limited available forage. It should be noted, however, that the viability of this institutional innovation remains to be established by future performance. -6-

(c) The emphasis on cooperatives as institutions to promote agricultural productivity is understandable when it is realized that further increases in total output must come largely from productivity increases, rather than from increases in the area under cultivation. The best agricultural land in Tunisia is already under cultivation, and no significant opportunities exist to add large areas to it. There would be shifts in cropping patterns such that more of some crops would be grown and less of others, all taking place within roughly the same cultivated area as at present. In this context, of course, production of some crops could increase if cultivated acreage under that crop increases, but this is not inconsistent with the main point -- e.g., total cultivated area in Tunisia is not expected to increase by any significant amount.

(d) Some of the major changes in cropping pattern include an anticipated reduction of about 20 percent in the area under cereals, and a substitution of forage production for fallow over large areas as part of a livestock improvement program. The loss of preferential wine markets in France is expected to bring a shift out of wine grape production and into crops such as citrus (where soils permit), almonds, or olives. Other cropping pattern shifts include increases in early fruits and vegetables, citrus, and pistachios, all for expanded export to foreign markets. It is important to note, however, that only a relatively small part of Tunisia's arable land is in a warm enough climatic zone to produce fruits and vegetables significantly earlier than southern European producers. While some early production is possible, such opportunities are quite limited.

(e) Irrigation is expected to make a critical contribution to production in certain respects, particularly where market vegetables, citrus, and livestock (forage) will provide high value outputs, but the scale of this contribution is relatively modest. The Plan estimates that pre-Plan irrigated area was about 78,800 hectares to which all on-going irrigation projects (excluding the Lower M4edjerda Valley as a currently on-going project in this sense) would add only to 30,000 hectares by 1969. Some estimates, however, place the pre-Plan irrigated area at less than the figure given. With a total arable area of 4 .5 million hectares, this is a modest irri- gation effort in terms of area to be included. Surface irrigation is to be provided in several locations, but the major source of surface irrigation would be the -. 7-

Basin of the Oued Medjerda. Irrigation elsewhere is to come primarily from wells, and would provide fairly restricted opportunities for expanding irrigated acreage. Some limited expansion of the cultivated acreage is expected to be possible in the South, where deep wells could add new oases in the desert region.

(f) Livestock production is an important potential source of agricultural growth, and it is provided for within the general planning for cooperative development. Expanded meat and milk production could reduce some of the current import expenditures (e.g., for dairy products), and would also contribute to an improvement of the average Tunisian diet. Different approaches are being tried -- in the Northern Region, a change in cropping pattern from the cereals/fallow/cereals rotation of the colon farms would substitute forage for the intervening fallow in the rotation. In the variable rainfall area of the Central Region, where inadequate rainfall in the past has brought heavy stock losses, the Polycultural Cooperatives will enforce rotational grazing coupled with access to irrigated pasturage and forage (from a variety of spineless cactus) when natural forage sources are affected by drought conditions. Natural milkshed areas near the urban centers (e.g. Tunis and Bizerte) would rely on irrigated pasturage for dairy herds, and this dairy production would be closely tied to gathering and processing facilities to improve the marketing opportunities for milk.

(g) The Government is anxious to expand employment opportunities in the Tunisian economy, but it is not looking to agriculture to increase the numbers employed in that sector. Government also wants to maintain the population balance between regions, and in this respect it does look to agriculture for assistance by discouraging migration, particularly by providing livelihoods for people in the Central and Southern regions. The Cooperative program for those regions is an expression of this employment objective. Finally, Government does hope that the population now engaged in agriculture can find more chances to increase the amount of time spent in agricultural employment, and thereby increase incomes by additional productive work. This is an understandable and desirable objective, but some of the planning for cooperative activity, such as the retention of large-scale units and the continued use of farm machinery and extensive farm operations, may conflict with the objective of providing additional on-farm employment for the existing work force in agriculture. - 8 -

(h) Government continues to exercise a very strong influence over agricultural development by retaining price and marketing controls on the major crops, preferring to provide production incentives through subsidies on important inputs rather than relaxation of the price control on marketed crops. A large part of the rationale for this type of policy is the desire to stabilize the food prices for non-agricultural consumers, but this type of policy also has obvious weaknesses with respect to its effects on the incentives to produce and on the allocation of resources between alternative types of crop production.

III. RECENT PERFORMANCE BY THE AGRICULTURAL SECTOR

3.01 The available evidence suggests that Tunisia's agriculture has remained essentially unchanged over the past few years. Production data for the major crops reveal wide fluctuations in output from year to year -- fluctuations which have been due primarily to climatic factors. These variations make it difficult to assess the underlying trend with accuracy, but it seems clear that the situation in the agricultural sector has not been one of vigorous growth. The IBRD mission, reporting on the current economic position and prospects in March 1967, 1/ noted a 2.0 percent sectoral growth rate for 1960-1965, but the poor harvests of 1966 would lower this estimate. However, given the large annual variations, and the small number of years covered, such estimates of trend growth rates are not too meaningful. It is necessary for purposes of this report to observe only that there are few signs to date indicating basic change in the capacity to sustain agricultural growth. Table 1 presents the production figures for major crops, 1960 to 1966.

3.02 These data show there is no pronounced growth trend for foodgrains, and apparently none for olives. In fact, the latter seem to have been declining steadily since 1963. This reflects both the poor rainfall of recent years and the low stages of the production cycle for olive trees, and therefore may not actually indicate a reduced growth trend. Wine grape production may reflect Government efforts to gradually decrease the acreage devoted to this crop, but recent acreage data were not available to show the extent to which this is taking place. Production capacity for citrus is slightly expanded, largely as a result of increased acreage under oranges. The output of vegetables (e.g., artichokes, potatoes, peppers, and tomatoes) shows a rising trend, and while this may have future significance because of the high value of these crops, at present they occupy only about one percent of the area under cultivation.

1/ Citations hereafter to the work of this mission are made to the ("1967 Economic Report"). 3.03 Only fragmentary data were available on yields, but these show that yields of foodgrains (e.g. hard and soft wheat and barley) were lower in 1965 than they were in 1962 and 1963, both of -which were comparable years of good rainfall. The same is true in the case of vegetables, with the exception of artichokes. In fact, yields of potatoes, peppers, and tomatoes were lower in 1965 than they were in 1960, although total production was higher in all cases.

3.04 There are several possible explanations why the growth in agriculture has been so limited, but failure to provide financial resources is not among them. It was noted earlier that Government has been allocating to agriculture a proportion of total investment under the Plan roughly equal to the proportion of Gross Domestic Product (GDP) supplied by agriculture, e.g., about 20 percent. Projections of planned investment made in the 1967 Economic Report for the four years, 1967 through 1970, even call for a rise in the proportion of the total going to agriculture (to slightly more than 26 percent over the entire period), while agriculture's proportion of GDP is expected to decline further below the present level. Some of the recent investment in agriculture has undoubtedly been a replacement of worn-out agricultural equipment, but some of it was net new investment designed to increase agricultural productivity.

3.05 A look at the recent pattern of input use tells something of the reasons why agricultural growth has remained sluggish. Data were available only for domestic production and imports of fertilizers, rather than for actual application, but on this basis there does not seem to have been any notable increase in domestic use of fertilizers over recent years. This is certainly true in the case of nitrogenous fertilizers, all of which are imported into Tunisia. Imports in 1966 were lower than either 1963 or 1964, even after good harvests in 1965. The reasons for this are not clear - whether lack of foreign exchange, slowness in placing orders, or lack of demand by farmers - but the use of nitrogen is obviously not rising. Potassic fertilizers, also imported, show the same pattern, but here the reason is because ample notash is already available in most Tunisian soils. Production of phosphates in Tunisia has growm steadily, but so have exports. To estimate domestic use in recent years one can deduct exports from production, and assume the balance is being used by Tunisian farms. This method of estimation neglects any change in stocks from year to year, but in the absence of any better data it is a crude approxi- mation of annual use. Using this basis for estimation, domestic use of phosphates has moved upward, but only slightly, from the levels of application existing in 1962. Fertilizer data are shown in Tables 2 and 3.

3.06 Other inputs include machinery and spare parts for mechni- zation of agriculture, and materials for the protection of plants against insects and diseases. One measure of the relative role of farm mechanization is the availability of tractors and other mechanized equipment. Receipts of tractors of different kinds during 1960 through - 10 -

1966 were running at an average rate of around 1000 per year. Some of these were replacement of worn-out equipment, but some represented net additions to stocks. A new tractor assembly plant was opened in Tunis in 1966, and in that first year it assembled 750 tractors. A stock of around 300 tractors still remained in mid-1967, although there was no new assembly by the plant in 1967. While this appears to show increasing mechanization of agriculture, acquisition figures alone are not very conclusive. For one thing, the utilization made of tractors and other equipment is as important in assessing the impact of mechanization as the size and nature of the stock, and no data have beeni collected on such utilization. From observation in the field, however, it seems probable that less efficient operation of the existing stock in recent years may have offset any apparent advantage due to the buildup of that stock over previous levels. Spare parts have been imported in 1966 and 1967 under foreign loan, but lack of maintenance personnel has been an important bottleneck, and the cost of equipment repairs in the private sector is extremely expensive. On balance, it is unlikely that mechanization efforts have raised productivity much above levels achieved earlier, although more efficient utilization should begin to bring good results in such activites as preparing fallow land for forage production.

3.07 Officers of the plant protection service report that the rate of application of pesticides and other plant protection materials has not been increasing in recent years. The one exception to this was the protection of citrus crops, which is being done directly by the plant protection service for all citrus acreage. Technical assistance from Austria has provided aerial spraying facilities for this citrus program. The plant protection service is also responsible for assistance to farmers at times of major problems, such as locust attacks, but there is no general program at present to expand the normal use of plant protection materials on either cooperatives or private farms.

3.08 There remains the question of whether there have been significant improvements in the quality of husbandry practiced on Tunisian farms, and in this respect it seems clear that the standards of cultivation practice are an extremely weak element in the agricultural input program. The departure of the expatriate farmers left a major gap in terms of knowledge of, and experience with, modern agricultural techniques and equipment. To bring about a transition whereby traditional agriculturists become modern farmers will require supervision and guidance by people with more training and experience in modern farm operations than are presently available in Tunisia. Moreover, it will take time to acquire an experienced cadre of trainers and supervisors, although the Government has made good progress in providing the initial training of such a cadre. The operational standards of some cooperatives have obviously declined in effeciency relative to the earlier period -- a view based in part by observation of actual farm operations -- and the lack of experienced man- power must be a factor in the limited use of modern inputs and the ineffi- cient operation of agricultural equipment described above. In short, while the general strategy for the agricultural sector may be suited to the conditions in Tunisia, farm operations have not yet begun to match up to the standards required by the strategy. - 11 -

3.09 The preceding abbreviated view of both development policy and recent agricultural performance is presented as background to the project and program review which follows. Because of this background, the review tends to comment favorably on activities which have the effect of improving the qualitative, or increasing the quantitative, contribution of modern farm inputs, including managerial skills among them. Conversely, the high development cost per hectare and the relatively long gestation periods involved in irrigation works suggest it would be appropriate to adopt a more cautious approach toward future irrigation development. Further, it was noted earlier that although resources for agricultural development have been generally available, there are few signs of significant growth to date. This indication of possible under-utilization of facilities has underlain recommendations in this review that development efforts should be consol- idated, and a somewhat slower pace of implementation should be followed than originally planned.

IV. REVIEW OF PROJECTS

4.01 The agricultural projects included here for review are those which can be categorized as falling within fairly well-defined limits with respect to: (a) the area to be covered; (b) the nature of the activities to be carried out; and (c) the time schedule to be followed in achieving project objectives. With the exception of the irrigation sector, however, the Plar. does not contain projects in this same sense. The Government has provided, on request, project information for all cases where this was already available and could be assembled in an appropriate project description. As a result, descriptions are available for 15 projects in irrigation (of which nine were on-going), five projects in agriculture (of which two were on-going), two projects in forestry (of which one was on-going), and one fishery project. Only these projects have been included in this project review.

4.02 The project position is summarized in Table 4. Since the working definition of a "project" used here is somewhat restrictive, the projects in the list cover much less than the full range of developmental activity in the agricultural sector. Many activities, and several sub-sectors, are omitted because information on them could not be easily assembled in a project description. Thus, for example, the list in Table 4 contains no horticulture, soil conservation, or livestock projects. Some activities under these headings are carried out under the cooperative projects which are listed (both on-going and proposed), but some are not. No project descriptions were received for research, extension or technical studies, but it is unlikely that activities in these fields are included in any of the projects listed in Table 4.

4.03 Just as the projects under review do not cover all developmental activity in agriculture, they do not include all agricultural activities which receive foreign assistance. Tables are provided in Annex 9 which show foreign assistance to agriculture during 1965 and 1966, by country and by program, and these provide more detail than Table 4 on what various - 12 - countries have done. In addition to projects which are listed, therefore, assistance may have been given to complete a feasibility study, to support research personnel at experimental stations, to purchase cattle abroad, or to make a survey of underground water conditions. These types of activities make important contributions to agricultural development, and later sections of this report will indicate where these should be continued.

4.04 It should be evident from the foregoing that the Government of Tunisia has not made much use of a project approach to planning, either for its own purposes or to obtain foreign assistance. Because most activity takes place under broad program headings, plans for agricultural development have not been prepared in specific terms and implementation has tended to be poorly coordinated. There are exceptions to this Judgement, but for the most part the acquisition of inputs has not been directly related to expected production increases, proposed production methods are not always the most economical, projected output is not always consistent with estimates of future demand, and scheduling of total developmental activities does not reflect a realistic appraisal of abilities to carry them out. One important advantage of planning should be that it imposes a discipline to force a comparison of alternative uses for scarce resources. Planning around a substantial core of specific projects should enhance this disciplinary aspect of planning, and thereby the effectiveness of planning. Since planning will continue to be a major element in Tunisia's developmental efforts, more project formulation and better project preparation should bring benefits -- both in greater impact on future production, and better bases on which to attract assistance from abroad. Planning needs are discussed further in the section dealing with technical assistance, but it seems appropriate to raise these planning problems at the outset of the project review.

4.05 Some effort is made in the review to indicate an order of priority for the projects which were presented by the Government. It is important that these priorities be regarded as no more than rough indications, because there has been no opportunity to study any of the projects in detail and there is thus no solid basis for making judgements. Mloreover, and for the same reason, the assignment of a high priority does not imply approval of a project as such. Within this general framework, projects have been assigned one of three priority ratings -- first, second, or low. The three factors considered in deciding these priorities included (a) the general readiness of the project for implementation, (b) the probable impact the project would have on production, and (c) the relative ease in completing the project and bringing it to the stage of successful operation. Of the three criteria, readiness for implementation and the ability to complete the project were the important elements in deciding on the priority. In some cases, however, a first priority has referred only to the start of feasibility studies on a project, since the project appears promising from the standpoint of potential increases in production but requires more thorough study before it becomes ready for implementation. Under the circumstances, these are obviously highly subjective judgements, offered primarily as a basis for discussions within the Working Party. - 13 -

A. Irrigation Projects (On-Going)

4.o6 Information is available for nine on-going irrigation projects, the largest and most important of which is the development of the lower valley of the Oued Medjerda. The scope of this project depends, however, on activities which may take place elsewhere within the entire stretch of the Oued Medjerda lying inside the boundaries of Tunisia, and this fact creates problems of great complexity. A more extensive discussion of development of the Oued Medjerda Basin is given in Annex 1, but the main elements of the recommendations may be repeated here.

4.07 Work on the Lower Medjerda has thus far been carried out by an autonomous agency, the Office de la Mise en Valeur de la Vallee de la M4edjerda (OMVVM). By 1959, investment (in major structures) had reached a total of D 17.2 million, and a net irrigable area of 12,178 hectares had been developed. The OMVVM is currently proposing a further investment of D 12.4 million for the Plan period 1965-1968, of which only D 5.2 million is directly related to irrigation of new areas (10,967 hectares net irrigable). It is the latter amount which has been included in requests for foreign assistance.

4.08 Any developmental work carried out in one part of the Oued Medjerda Basin could have an adverse effect on agricultural prospects in other parts of the Basin. For this reason no region can be considered in isolation. On the other hand, it is not desirable to suspend all further developmental activity in the Oued Medjerda Basin until all out- standing questions are resolved. In order to minimize delays in continuing the development already started in the Lower Medjerda, and still deal effectively with the problems of inter-relationship between different parts of the Basin, will require a comprehensive approach to project planning.

4.09 An overall study of the Medjerda Basin is necessary to guide future development of all regions of the Basin. Growing demands on the Basin resources for both drinking water and irrigation will increasingly raise questions of availability of future supplies and increasing salinity. A Basin-wide study should cover hydrologic, agricultural, and economic aspects, and should also consider the type of organization needed to operate a complex mixture of facilities (e.g., storage dams, tubewell fields, trans-basin diversions) and install the necessary monitoring devices. A study of this kind could take about three years, but the ultimate cost of the study will depend on such things as the availability of counterpart personnel and the present status of various studies and investigations. Costs could range between D 250,000 and D 500,000, but a more reliable cost estimate and more specific terms of reference must be prepared at a later stage.

4.10 While a study of the Oued Medjerda Basin is in progress, it should be possible to continue some developmental work on the basis of the start already made in the OMVVM project area. The African Development Bank is considering financing part (e.g., around 3,000 hectares) of the proposed further development area of 10,967 hectares noted above. The IBRD also plans to send a mission to define and appraise a project in the - 14 -

proposed development area for consideration for IBRD lending. A large amount of data has been collected, but further analyses appear necessary to resolve problems relating to adequacy of water supplies, the salt content of the Medjerda water, and the appropriate scope for financing. A technical mission is required to examine the existing data which bear on these problems, and to also look carefully into the proposed cropping patterns, the marketing prospects, management capacities, and the methods of construction to be applied. This mission could also draw up the terms of reference for the study of the entire Medjerda Basin, and prepare estimates of the cost of such a study. If sound development plans for the next stage of work in the OMVVM project area are to be made, the Government must be willing to restrict development of the upper and middle valleys of the Basin to a rate and type of development which neither jeopardizes that next stage of OMVVM project continuation nor prejudices any recommendations to be forthcoming from the Basin-wide study.

4.11 A high priority should be given to the selection of qualified technical personnel to carry out the study of the Oued Medjerda Basin and the requirements for its integrated development for agricultural and other purposes. There are no technical reasons why the two studies cannot be launched quickly.

4.12 There are eight other on-going irrigation projects besides the OMVVM, and these are expected to add 30,281 hectares of gross irrigable acreage. Several of these have been under construction for some time, but two-thirds are currently scheduled for completion by 1968. The rest should be finished during 1969. With the exception of the Oued Chiba project, which is relatively small, and the OMVVM project described above, all on-going irrigation projects currently receive some financial assistance from abroad. The Oued Chiba project has been financed solely by the Government of Tunisia; the OMVVM project has had some foreign financing in the past, but does not have such assistance at present. The list of these eight on-going projects, together with their gross irrigable acreage, total investment costs, and average cost per hectare, is presented in Table 5.

4.13 The most striking thing about these data, aside from the observation that they involve relatively small areas of commanded acreage, is the very high gross costs per hectare. Only in the case of the shallow and deep wells do the costs per hectare begin to fall within a range which could be economical, although the total costs shown for the deep wells do not actually include costs of agricultural development as do estimates for the shallow wells. In any event, this body of experience suggests that on-going efforts at surface irrigation tend to reach cost levels where the resulting increases in agricultural production appear insufficient to recoup the additional costs. By comparison, groundwater development may be the more promising approach to irrigation in Tunisia. This is a tentative conclusion, however, since the cost of groundwater projects can also be affected by the extent to which plans incorporate costly elements such as elaborate pipe and sprinkler systems, or pre-cast, pre-stressed canals. Nevertheless, if such high cost aspects are minimized, the use of water drawn from groundwater resources seems to offer distinct economic advantages in Tunisia. - 15 -

4.14 These eight projects should receive sufficient priority to be completed as presently scheduled, i.e., all tc be finished by 1969. This recommendation is largely because all of the eight (again excepting Oued Chiba) are receiving assistance from abroad, and all are well advanced in construction. Oued Chiba itself is about 80 percent completed at the present time. While this recommendation would be different if these projects were at the start of construction, the fact that they have gone so far toward completion is persuasive they should now be completed as quickly and as economically as possible. No estimates were furnished on the annual costs required to finish these projects over the next two years, but a rough guess would be that this could require around D 5 million in 1968 and D 3 million in 1969.

4.15 A number of general impressions and observations on irrigation are relevant to this brief review of the projects:

(a) Although irrigation looms large in the developmental program, in terms of the number of projects underway, irrigation opportunities apparently do not exist on a major scale in terms of acreage covered. Irrigation can make important contributions in a limited number of areas, particularly in promoting the production of high-valued crops, but the main burden of the develop- mental effort in agriculture will fall on areas dependent on rainfall.

(b) There has been a tendency to use very expensive irrigation facilities in Tunisia, including some that are as technically advanced as anywhere in the world. One result of this has been irrigation costs per hectare which are extemely high, and economically unjustifiable in light of the production expected to result from the investment. Much could be done to reduce the costs of irrigation, including a greater use of local materials and local farmers' labor. Some plans for inexpensive installations using local materials have actually been drawn up by Government engineers, but the actual projects have incorporated more costly designs.

(c) The technical implementation of the projects, i.e., the construction work on dams, well digging, canalization, and other works, appears quite good, but the facilities will generally be ready on these projects long before the farmers will be trained and organized to use the water properly.

(d) A related point, implicit in what has been said earlier, is that despite good technical planning and implementation, the economic aspects of the projects seem to have been badly neglected in the planning and approval stages. Cropping patterns may have to be reconsidered in order - 16 -

to take best advantage of the irrigation facilities. The expected increase in citrus production is a case in point. On-going irrigation projects are expected to increase citrus output by about 100,000 tons annually when all projects are fully developed, or an amount about equal to current production. FAO market projects for 1975 estimate that total citrus production by Mediterranean cuntries will be approximately 8.6 million tons against an expected demand in European markets of only 6 million tons. Tunisia is in an admittedly advantageous position because its oranges are a preferred variety, but under expected conditions it is clear that increases in citrus output will make marketing an increasingly critical factor, and that marketing surveys and quality control improvements will be necessary to minimize such problems.

(e) The indications are presently that development of groundwater may be a more economical irrigation method than surface water development. More information should be ready by the end of 1967, for a study of groundwater resources financed by US AID will have completed a "pre-feasibility" study stage at that time. This should produce reliable hydrologic data for all regions of Tunisia, and subsequent analyses should reveal whether the proposed expanded deep well program is technically feasible.

(f) Extension activities to teach farmers the proper use of irrigation water suffer from the general lack of experienced personnel. Estimates of the personnel requirements and suggested staffing patterns are discussed at a later stage in this report, but it should be noted that irrigated areas require a higher density of extension staff than do non-irrigated areas.

B. Irrigation Projects (Proposed)

4.16 The assessment of proposed irrigation projects reflects this past experience with irrigation in Tunisia, as well as the information which could be derived from the available project descriptions. Brief project descriptions are given in Annex 3 to this report, while observations and suggested priorities are summarized in the paragraphs which follow.

4.17 The irrigation project which offers the most interesting prospects, from a developmental standpoint, is the planned rehabilitation of oases located in the southern part of the country, and designed to build on an irrigated agriculture which has been carried on in the oases for centuries. The project's attractiveness stems from the fact that it would expand the production of early vegetables, which would have a ready export market in Europe, and production of vegetables and livestock products to supply the - 17 -

rapidly expanding tourist industry in Tunisia. The marketing aspects are thus more promising than in other projects, and the economic contribution of the project appears somewhat more assured. Topographic studies, some detailed soil studies, and some hydrological studies have been carried out, but more hydrological studies are required. Such studies should be coordinated with the analyses being prepared under the deep well survey. Because no studies of economic feasibility (including market surveys) have been carried out as yet, completion of these necessary studies warrants a high priority. If the studies bear out the promise which this project now seems to offer, the project can be prepared fairly quickly for consideration for financing.

4.18 Three of the proposed projects are located in different parts of the Upper Medjerda Basin -- Oued El Abid, Souk El Khemis-Souk El Arba, and the Ghardimaou Plains. The recommendation was made in para 4.09 above that the rate of development in the Upper and Middle Medjerda should be restricted to a rate which would neither jeopardize the continuation of the OMVVM project in the Lower Medjerda, nor incorporate premature judgments on the outcome of the Basin-wide study. Priorities for these projects are implicitly incorporated in this earlier recommendation.

4.19 The surface irrigation project connected with development of Lake Ichkeul deserves a low priority from the standpoint of its agricultural impact. A detailed feasibility study of the project indicates that the most promising alternative would cost about D 2,500 per hectare, but this would not include provision for drainage. Economic justification is highly doubtful where development costs reach levels as high as this. The feasib- ility study also notes, however, that aquifers with good quality groundwater have been discovered underneath previously known groundwater resources. It would appear preferable to explore such groundwater irrigation possib- ilities before making any start on surface irrigation in the Lake Ichkeul project area. The alternative recommended by the feasibility study calls for multipurpose development, including some hydroelectric generating capacity, and the supply of potable water for Tunis and industry in the Menzel Bourguiba area. Whatever the feasibility of the project may be in terms of these additional purposes, from the standpoint of agriculture it appears to be an expensive project whose contribution to irrigation could possibly be duplicated from groundwater at much lower costs per unit of area developed.

4.20 The Government did not provide project descriptions for drainage projects. Drainage activities are currently being carried on by the Under Secretariat of Agriculture under a series of small projects scattered throughout the country, at total costs of around D 1.4 million. The Govern- ment is apparently not seeking any foreign assistance for drainage projects, and there is inadequate information on which to assign any priority to this activity. Also omitted are irrigation investments included under the cooperative programs. These are not irrigation "projects" in the same sense as others discussed here, but the contribution of irrigation is taken into account in the discussions of cooperatives below. - 18 -

4.21 Only one project description concerns flood control, and this calls for a barrage on the Oued Zeroud. A feasibility study has been prepared for this barrage, but the study does not contain an economic evaluation of the project. On these grounds the project is not ready for consideration at this time. An initial impression, based on the data which are included in the study, is that it would be a high cost project. From the standpoint of the preliminary cost estimates, it is doubtful that the project merits further consideration for implementation in the near future.

C. Agricultural Projects (On-going)

4.22 There are only two on-going projects under the general heading of agricultural development, and both are cooperative projects. The Pro- duction Cooperative Units (UCP) project for the Northern Region has just begun (1967) with the help of an IBRD loan of US$ 12 million and an IDA credit of US$ 6 million. The Polycultural Cooperative project for the Central Region has been under implementation for a slightly longer period (starting in 1966). It has benefitted from UN activities in the Central Region, but it does not have direct foreign assistance as yet for the project itself. The UCP project expects to develop a total area of 345,000 hectares, with the initial organizational phase to be completed by the end of 1968. The Polycultural Cooperative project anticipates 1.4 million hectares will be organized into cooperatives over the period 1968-1971, and all investments to be completed by 1976.

4.23 These two on-going projects appear well-designed on technical grounds to take advantage of the opportunities inherent in the soil and water conditions found in each of the two regions. Both projects are based on technical agricultural studies which have been well prepared. The economic aspects of the UCP project have been estimated to yield an internal rate of return to the economy of about ten percent. On the other hand, the Polycultural Cooperative project gives an important role to pistachio and olive production, and this raises some questions about the economic feasibility of the proposed cropping pattern.

4.24 Experience thus far on the UCP project reveals that new water sources will be needed for the projected livestock development. There is also need to explore alternative sources of forage besides the "oat and vetch" hay which is currently used. Market studies for livestock production seem indicated, since there are few reliable estimates of the quantities of milk, milk products, and meat (both sheep and beef) which can be marketed, and little guidance on the kinds of improvements in marketing facilities which are required to expand the market opportunities. The most pervasive problem, however, concerns the lack of experienced managerial and extension personnel. The Bureau of Control, established to supervise and assist in the organization and implementation of cooperatives under the UCP project, includes expatriate technicians to provide an important source of add- itional support to the managers and extension staff on the cooperatives. - 19 -

The Bank, in extending financing to the UCP project, set the rate at which the project can be implemented to be consistent with estimates of what could be done with the expatriate and Tunisian personnel likely to be available. Unless changes occur in the amounts of managerial experience on hand to direct cooperative growth and development, there would be no reason to change that original estimate.

4.25 The prospects for trained staff at different levels, and the requirements for different types of personnel, are summarized in Table 6. Different densities of agricultural officers, agricultural assistants, extension workers, and cooperative managers have been assumed for the different types of agricultural projects currently underway. The latter three technician categories receive about five years of training, albeit different kinds of training; the agricultural officers receive six years of schooling after the baccalaureate. Thus, categories of personnel with about the same length of training have been grouped together (in the totals showqn at the bottom of the table) to make a comparison between expected requirements and expected availability. As the table indicates, the number of persons trained to the level of agricultural assistant, extension worker, or cooperative manager should about match the requirements of the projects shown. The number of persons trained to the level of agricultural officer would actually exceed the number required by the projects. The table makes no allowance for needs other than the projects (e.g., forestry, research, veterinary practice, private employment, and so on), and no allowance for attrition in the staff over time, so the excess availability over require- ments may actually be less than the table shows. More important, however, is the lack of personnel who have had much real experience in agriculture, and the fact that training alone will not provide a substitute for experience. Such experience is most valuable when acquired under the direction of an experienced supervisor. It may be desirable to increase the density at which agricultural officers are assigned upon completion of their formal training, the actual density to be determined by the numbers of officers available and the rate at which new cooperatives and irrigation projects become operable. This increase in the density of assignment may not be a substitute for experience, but it will reduce the scope of responsibility for the new officers and allow them to acquire a more concentrated experience in the early years.

4.26 The on-going UCP project clearly deserves a high priority. It already has financial assistance, and it should be brought to completion as planned. The experience gained in the process of completing this project will be invaluable in guiding the preparation and implementation of succeeding cooperative projects. Unless this project can be successfully implemented, there seems little point in considering further efforts of a similar type. As mentioned earlier, the availability of experienced managerial and supervisory skills is likely to be a critical problem, and for this reason it may be advisable to assign a lowier priority to the Polycultural Cooperative project. It is difficult to state any precise rate of implementation which might be feasible, but the Polycultural Cooperative project should not proceed at a rate which would draw personnel from the high priority UCP project before the latter becomes well established. The Government will obviously proceed with some development in the Central Region in any case, but such efforts should probably not exceed one-half - 20 - the implementation rate called for in the Polycultural Cooperative project. A target of 700,000 hectares under Polycultural Cooperatives by 1971 seems the maximum likely to be achieved without impeding development of the UCP project.

D. Agricultural Projects (Proposed)

4.27 Project descriptions were received for three agricultural projects proposed for future implementation, and as in the case of the on-going projects these all involve cooperative organizations. Two of the projects would expand the number of cooperatives in operation, while the third is a technical assistance project in support of cooperative development. Descriptions of all three projects are provided in Annex 5 of this report.

4.28 The largest, in terms of both acreage and cost, is the further expansion of Production Cooperatives (UCP) in the Northern Region. This project is about equal in size to the on-going UCP project, and is scheduled to begin at the end of 1968 after the initial organization of cooperatives under the on-going project has been completed. The justification for the project, i.e., the assumptions concerning costs and benefits, closely follows that used for the on-going project, as do the organization and management features and the basic plan of operation. The obvious factor about this project is that it stands to benefit enormously from experience gained under the on-going project in the same region. Since the latter has gotten underway later than orginally planned, it is unlikely that it will have completed the organization stage by the end of 1968, and therefore the proposed timing for the new project would probably be delayed accordingly. If the on-going project seems to be malting the progress expected of it during 1968, there will be time to start preparing the expansion project for financial consideration shortly thereafter. The expansion project would probably not be able to start before 1969, and possibly not until 1970, because experienced managerial and supervisory personnel will continue to be scarce in relation to project needs. Actual project preparation should present no problems when the appropriate time comes because the experience under the on-going project should provide ample information for any project presentation. The project thus rates high because it can be readily prepared and is based on a similar on-going effort. Its timing is more doubtful because of personnel deficiencies.

4.29 The second proposed cooperative project calls for organization of Service Cooperatives in the Sahel region to provide extension advice on new cropping patterns, along with credit and marketing assistance. Unlike the UCP cooperatives, farmers would continue to cultivate and harvest their own lands. Major changes would include the introduction of a program of olive tree pruning in order to increase production from existing groves, and a shift from cereal production to more livestock and more fruit trees. The objectives of the project are relatively modest, as are the costs, and the foreign exchange component is only about eight percent of total costs. Detailed studies have been completed for 20 cooperatives, along with an inventory of olive groves, and studies of an additional 70 cooperatives are - 21 - under way. These studies include pedology, hydrogeology, soil conservation, and agronomy, and are expected to be completed by the end of 1968 or early 1969. Preliminary indications are that the recommended changes in cropping pattern and cultivation techniques would be technically feasible, although the large increase in olive production may create serious marketing problems because the future prospects for increasing exports of olive oil are relatively poor. The relatively modest foreign exchange requirement makes this an attractive small project for foreign financing. As in the case of the UCP expansion project, increases in the number of cooperatives under this project should be held to a rate which does not draw scarce managerial and supervisory personnel from the on-going UCP project in the Northern Region, where large resources are already committed. Again, any increase in overall availability of these scarce personnel would ease this basis for restricting the rate of implementation. The Government is also planning a Service Cooperative for the Northern Region but a project description and details of the program were still not available by the time this review was being prepared. From discussions with Under-Secretariat officials, its economic justification and readiness for implementation are comparable to the Service Cooperatives proposed for the Sahel Region.

4.30 The third project is a technical assistance project which has been submitted to the UNDP for consideration. Although other technical assistance suggestions are discussed in a subsequent section of this report, the close tie between this project and the cooperative projects permits special mention of it under this heading. As a general statement, the project calls for the provision of expatriates to assist in planning for the Polycultural Cooperatives in the Central Region, the training of cooperators and cooperative managers in various modern farming techniques, and general support to the agronomists and extension workers in the Central Region. A project of this kind deserves a high priority because it is urgently needed where lack of extensive modern farming experience is such a critical constraint on the rate of future development of the cooperatives.

E. Forestry Project (On-going)

4.31 A project to develop plantation of fast-growing species of trees in the governorat of Bizerte is already on-going, and by 1964, 8,000 hectares planted in trees had replaced formerly unproductive bush. The ultimate objective is to include 40,000 hectares within the project, and to accom- plish this with a planting rate over a seven-year period (1968-1975) which approaches an average of 3,200 hectares per year. Annual production, which starts from the 12th year of development, would be 3,200 hectares at an average yield of 70 m3 per hectare, or a total output of slightly more than 200,000 m3 per year. A more detailed description of the project is provided in Annex 6.

4.32 The economic justification for the project has been based on the demand from a proposed pulp mill with an annual capacity of 30,000 tons although a mill of this size requires only about 100,000 m3 of wood as raw material. Moreover, the expected increases in Tunisian demands for paper products (in excess of existing capacities to produce paper) are about - 22 -

15,000 tons per year by 1971, and these are equally divided between Kraft, printing, and writing papers. The pulp to be produced by the on-going project may not be suited for production of all these different varieties of paper. There is the further question whether the proposed average planting rate (e.g., 3,200 hectares per year) can be achieved with the staff and equipment likely to be available.

4.33 This project seems to be of low priority at this time because the economic justification for the project, as presently conceived in terms of size and nature of operation, is doubtful. There is apparently adequate documentation for the technical aspects of the project, but determination of the economic size (particularly as related to investment in the mill capacity to use the raw material) requires a much more thorough study than has been made thus far. Before this project is given serious consideration for financing, there should be an economic study to accompany a modified version of the present project.

F. Forestry Project (Proposed)

4.34 The Government prepared one new project description in the forestry sector -- a proposal to improve the exploitation of existing forest resources within an area of 190,000 hectares in Central Tunisia. Although the Forestry Service has started some investigations to improve the exploitation of timber, the proposed project would require more studies of various kinds, plus feeder roads and other infrastructure investments, and equipment to undertake a semi-mechanized exploitation system. The project would initially be under the Forestry Service, but the ultimate objective is to turn over the activities to a special organization or a cooperative body. The training of forestry personnel has been assisted by Finnish and German funds and staff, and a forestry research institute is financed through UNDP funds. The project is further described in Annex 7. 3 output of timber in the project area is about 20,000 m 4.35 Present 3 per year, and the project anticipates increasing this to 65,000 m the first year, and to over 130,000 m3 by the third year of development. Market prospects for this volume of timber appear good. Costs of exploitation and investment would total around D 650,000 over a five-year period. The project can benefit from studies already made by FAQ on forest exploitation and forest economy in Tunisia, a report on exploitation by a Finnish forestry officer, and a forest management study in the project area covering 80,000 hectares. Studies of the additional 110,000 hectares are already underway, and are due to be completed by the end of 1969. The latter studies are being carried out by SCET and by other French technicians.

4.36 This should be a high priority project, and the necessary supporting studies should be completed as soon as possible. In this connection, marketing studies and an investigation of the economic justif- ication must be provided for in the future program of studies. Because the project would continue to exploit areas already being inefficiently exploited - 23 - to some extent, there would probably be some increase in annual production in any case. The proposed rate of exploitation under the project may be too rapid, particularly in view of the heavy use made of forestry service personnel in the "Lutte Contre le Sous-Developpement" (LCSD) programs of terracing and afforestation of hillsides and roadside plantings. However, this is a question to be resolved in the course of the further studies of technical and economic feasibility.

G. Fishery Project (Proposed)

4.37 One fishery project description was received, which proposes that the coastal fishing fleet be converted from one composed predominantly of sail and row boats to one consisting of plastic-hulled, motorized vessels of six, eight, and ten meters in length. The project envisages that coastal fishing will ultimately be carried on by 3,000 of these motorized vessels, and that modernizing the fleet would permit larger catches at higher average catches per man. By fishing in coastal waters 60 miles or more from Tunisia, the type of catch would be largely high-valued fish for both export and domestic consumption. The project is further described in Annex 8.

4.38 Although some studies have been carried out to determine the size and nature of the fishery resources near the coastal waters of Tunisia, the project for converting the fleet to motorized vessels requires much additional study and preparation before it could be considered for foreign financing. As it is now presented, the vessels would be constructed by the Office de la Peche, and would be sold to fishermen by the Office under arrangements whereby installments would be deducted from the value of fish sold to the Office. The economic viability of this arrangement, as well as the technical points relating to the design of vessels and equipment, require further study. The project does not showr a time schedule in its present form, and it is not clear whether it would be necessary to have a training program to teach fishermen how to operate the vessels and equipment. If a training program is required, there is no indication shown of the availability of personnel to carry out such training, or how long it would take to complete.

4.39 This project has been placed in the second priority category, primarily because it is not ready for early implementation and requires much preparation work. On the other hand, it touches an area where further development seems generally feasible, and could lead to increased protein food production and additional foreign exchange earnings if implemented successfully.

H. Summary of Project Review

4.40 The above review of the 23 projects prepared by the Government of Tunisia, both on-going and proposed, has included a preliminary assignment of priorities. These are presented in Table 7. Of the total projects received, 16 have been designated as of "high"' priority, and implementation in some fashion could be started quickly. This is a large proportion to be placed in this top ranking, but eight of these are already on-going - 24 -

irrigation projects. In those cases the ranking simply reflects the judgment that they should be brought to completion at the earliest feasible date. A high priority is given to the definition and appraisal by IBRD of a further development project in the Lower Medjerda project area (OMVVM) which is required to bring it to a stage where it can be considered for financing. The companion recommendation, i.e., to conduct a long-term study of the entire Medjerda Basin, would include three of the proposed irrigation projects in the Upper Medjerda as part of the program to be studied. Four other projects are of high priority, and include one proposed irrigation project (Reconversion of Oases), the on-going Production Cooperatives (UCP) in the Northern Region, one proposed training program for cooperators and cooperative managers, and one proposed forest project (Forest Exploitation). All of these seem to offer promising economic returns on the basis of limited available information. The first and last of these four projects still require some studies before all feasibility questions can be resolved, and the high priority applies to completion of the necessary studies rather than actual project implementation.

4.41 Four projects -- the on-going Polycultural Cooperative Project, the proposed Service Cooperative Project, a proposed fishing project, and the proposed expansion of Production Cooperatives (UCP) in the Northern Region -- seem technically feasible, but the economic prospects have not been fully studied in the first three. Early implementation of all the cooperative projects would probably place some strain on existing scarce managerial and advisory resources. It therefore seems prudent to introduce the qualification that these projects be scheduled for further attention only if it is determined that the personnel requirements of the high priority projects are being fully met. The proposed fishery project requires further project preparation studies.

V. TECHNICAL ASSISTANCE REQUIREIIENTS

A. Planning and Project Preparation

5.01 A review of documentation supporting on-going and proposed projects, as well as the agricultural development program generally indicates that technical assistance is needed in the planning and project preparation stages. This need emerges in several different contexts, and despite the fact that expatriate consultants and advisors are already being used in certain planning activities. Much of the technical planning, e.g., the engineering and agro- nomical work, appears very well done, but the economic justification given a project or program is frequently very weak, or even entirely omitted from consideration. This results in Government acceptance of projects which may function perfectly well, but which are completely unsuited economically to the situation in which they would be applied. For example, there are severd instances (in projects and in the Plan) where agricultural revenues are projected on the basis of highly doubtful estimates of crop sales. The cases of citrus production (in on-going irrigation projects) and pistachio production - 25 -

(in the Polycultural Cooperatives) have been mentioned earlier in this report. A similar over-production seems likely for artichokes -- FAO estimates Tunisian exports must reach 14,000 tons by 1970 to make use of the excess of production over domestic consumption. Since world trade in a specialized crop like this is quite small, greater production will encounter increasing marketing hazards. Estimates made by OECD indicate tomatoes, another potential export crop, will encounter market resistance abroad because European production by 1970 will be surplus compared to Europe's needs. Unfortunately, the bulk of Tunisia's potential production is not of the early varieties. Technical assistance thus seems necessary both to help improve the market evaluations and to introduce more advanced marketing practices in association with project implementation.

5.02 But more is needed than better economic evaluations and market projections, because Government planners also need assistance in preparing projects. For example, with the exception of the Lower Medjerda project, which has been prepared with the help of expatriate consultants, none of the projects presented were at a stage where they could be readily considered for external financing. Technical assistance in planning is not recommended only to improve the presentation of projects to potential foreign lenders, however9 for there is imprecision in much of the planning for agriculture. The Plan contains many useful observations and much technical data, but the failure to convert the welter of ideas to discrete, manageable projects covering the major elements of the developmental strategy makes it difficult to trace the relationship between proposed investments and the production targets to be attained. More precise planning, built around a project - oriented basic developmental program, requires more experienced technical assistance than has been available. Such planning should provide a more readily understandable basis on which to allocate available resources, both foreign and domestic.

5.03 Despite the presence of some technical assistance for planning already attached to the Under-Secretariat of Agriculture, it thus appears desirable to strengthen the planning effort at this level, particularly with respect to project planning and preparation. A related activity, which is also essential to any improvement in the effectiveness of planning, concerns the collection and analysis of agricultural statistics. At present. for example, different official sources offer different estimates of crop production and acreage, it is difficult to get regional breakdowns, and there are gaps in the data. Technical assistance could be helpful in improving the methods of collecting basic agricultural data, in deciding on which measures and which levels of detail would be most useful for planning and research purposes, in processing the data, in devising new ways to present the data and reduce the time required to make it available, and finally in analyzing it. - 26 -

B. Research

5.o4 Agricultural research in Tunisia has begun to be concerned with problems which farmers and cooperative managers are currently facing, and less engrossed in research activities which appear to have little immediate practical application. This practical orientation is badly needed, and its emergence is very welcome. Some of the problem areas where further research is needed include studies of irrigation agronomy (e.g., the proper timing of water applications, proper land preparation for irrigation), the possibilities of expanding sugar beet production, with and without irrigation (sugar imports incur heavy foreign exchange costs), experimentation to identify which improved forages are best suited to local conditions, tobacco production possibilities, and local adaptations of improved varieties of cereals, particularly wheat. This is not intended to be an exhaustive list, but rather an indicative one illustrating the kinds of problems which have already arisen.

5.05 Although information was not readily available with which to quantify research needs in Tunisia -- e.g., how much equipment is needed, how many technicians and research personnel can be used, what kinds, and so on -- it seems unlikely that too much research capacity is being introduced into Tunisia. Since productivity increases in agriculture depend, in part, on accurate, research-based knowledge of the environmental factors affecting production, technical assistance in support of such research clearly deserves a high priority. There are several research institutions under the Under-Secretariat of Agriculture -- the Institut National de Recherche Agronomique (INRAT), the Centre de Genie Rurale (CGR), the Institut de Reboisement, and with UTIESCO assistance, the Centre de Recherche de Utilization des Eaux Salinees pour Irrigation (CRUESI). There are also research institutes for livestock and fisheries operating under the aegis of the respective Offices established for those sub-sectors of agriculture. France is currently the most important source of technical assistance to agricultural research in Tunisia, although other countries have taken part as indicated under the broad heading of research shown in Table 3 of Annex 9. A list of projects being carried out by the research institutions cited above (but not reproduced in this review) indicates that their research activities cover a wide range of practical problems, but there has been no opportunity to examine the extent to which research may be hampered by the need for more trained personnel, research equipment, or other facilities. Beyond the obvious comment that there probably are needs of these kinds, two further observations appear relevant to possible further technical assistance to research. One is that an important need at the present time is to test in Tunisia research findings developed elsewhere in the world, in order to adapt such findings to Tunisian conditions. This view is offered as a caution against the assumption, which sometimes underlies technical assistance in research fields, that research results can be transferred readily without further testing their suitability or applic- ability in different areas. A second point, related to this first one, is that the technical assistance personnel selected to serve in Tunisia should be research workers who have had appropriate experience under conditions similar to the Tunisian environment. - 27 -

C. Extension and Training

5.06 The topics of extension and training are considered together because they are so closely related in the context of Tunisian agri- cultural development. This report has stressed at numerous points that lack of experienced managerial and supervisory personnel imposes a significant constraint on development at the present time. This is not the same as saying there is, or will be, a lack of trained personnel, for the report has also shown that the number of people expected to complete formal training will probably be adequate to staff the positions now contemplated. It does mean, though, that until trained people obtain experience, and preferably under the guidance of supervisors who are experienced themselves, and constraint will continue to be in effect. Clearly, to gain proper experience requires time, but technical assistance to provide experienced supervisors and trainers could also reduce the amount of time required.

5.07 The Government is aware of the serious deficiencies with respect to experienced manpower resources, and has already begun to take steps to overcome them. Two crash programs are scheduled to begin in 1968 -- one would be a program to provide additional training to extension personnel through two-week courses to be given at least twice a year; the second is a program designed to provide farmers with training in practical, elementary skills needed to improve both crop and animal husbandry. The latter program would be conducted at 20 different training centers, with each center training about 15 farmers for a two-week period. The current plans anticipate that farmer training could be carried out a rate which would include about 7,000 farmers per year, but it is too early to judge either the impact of such training on actual farm practices or whether the rate of training can actually be sustained. In any event, at a rate of 7,000 farmers trained per year it would require two and one-half years to give this minimum level of training to the existing cooperative members in the on-going Production Cooperatives project (UCP) in the Northern Region. Similar types of training for farmers, both young and old, is already being provided by the OMVIM, and in the case of its training centers for youths the participating students are drawn from parts of Tunisia outside of the OMIVVM project area, as well as from the OMVVI'4 area itself.

5.08 There are also plans to improve the quality of education given at the highest level by adding new laboratories and other facilities at the Ecole Nationale Superieure d'Agriculture de Tunis (ENSAT). During the academic year 1967/1968 there were 204 students enrolled in the 4-year course leading to the Diplome d'Ingenieur in the field of agriculture, which may be compared with a total of 47 students enrolled in 1960. In the same academic year, a second cycle was begun which would provide a fifth and sixth year beyond the existing training period. A program leading to the doctorate level has been in effect since 1964, and is conducted in close association with the Faculties of Science at Tunis and Paris. At all these levels, therefore, Govern-ment is already proceeding with both plans and on-going activities to improve the training and the practical experience of those involved with Tunisian agriculture. - 28 -

5.09 The proposed UNDP project to train cooperators and cooperative managers also fits well into these efforts. Another kind of approach has been incorporated into the IBRD-financed Production Cooperatives (UCP), where expatriate technicians and Tunisian counterparts screen cooperative production plans and provide supporting technical advice through a Bureau of Control. Both of these methods of providing technical assistance could probably be expanded with benefit to Tunisia's agricultural develop- ment programs. While existing foreign technical assistance efforts in the training schools, universities, and research labs are important and necessary, and should be continued at least at the present levels, there should also be increased efforts to provide technical assistance to the cooperative managers and extension workers as they work on their jobs, i.e., providing in-service training and close supervision.

5.10 It is also difficult for agricultural officers, assistants, and extension workers to do full justice to their assignments because they are hampered by lack of working equipment. It is hard for them to cover the areas assigned without rapid transport of some kind, at least to the point of a motor scooter or bicycle. Demonstrations may be hampered at times by lack of materials necessary for the demonstration (fertilizers, seeds, simple tools, modern equipment). Technical assistance could provide the equipment necessary for field staff to perform the jobs expected of them. The costs of such assistance would probably be relatively small, but the strategic impact should be among the highest of any investment which could be made in agricultural development. Technical assistance to improve the repair and maintenance of farm equipment, vehicles, and machinery is another area of high strategic importance. The Canadian Government will provide mechanics to teach and help in the repair of hydraulic equipment, and will also supply mechanics to work with the Office de Motoculture. Such assistance is greatly needed to raise the efficiency of the existing stock of mechanized equipment, and serious consideration should be given to expanding this particular type of technical assistance.

5.11 In concluding this brief series of observations on technical assistance, one final suggestion is that a thorough study of technical assistance needs and technical assistance availabilities be made. The result could lead to a more rational and economic use of technical assistance resources by concentrating them on the most urgent needs, avoiding duplication of effort, and drawing experienced personnel in accordance with each country's ability to provide skills most relevant to the Tunisian agricultural environment.

VI. AGRICULTURAL INPUTS

6.01 Review of the agricultural sector's requirements did not reveal any obvious deficiencies in the provision of agricultural inputs. Questioning of agricultural officers in the field, or officials in Tunis, elicited the response that supplies of the important inputs were adequate relative to the farmers' willingness to use them. In short, there were no complaints about shortages. This does not mean that the use of modern inputs such as fertilizers, pesticides, mechanized cultivation, and the - 29 - like is in any sense optimal. On the contrary, earlier discussion of the slow growrth in Tunisia's agriculture pointed to the fact that the use of modern inputs was not expanding very rapidly. Overcoming this is, of course, the essence of agricultural development. Factors influencing the use of modern inputs include the availability of foreign exchange for inputs which must be imported from abroad, and an incentive structure (in terms of costs of inputs and returns from agricultural output) which strongly encourages both private farmers and cooperatives to use more of the modern inputs. Since the Government currently exercises controls on both input prices and the prices of farm output, it should be possible to insure that incentives operate to encourage input use. On the other hand, if the overriding objective becomes one of keeping agricultural output prices low for the benefit of urban consumers, there is danger that the incentives for farmers may be seriously diminished.

6.02 An important part of the current input requirements is being met by the latest U.S. commodity loan (664-H-033), which will provide foreign exchange for such needs for the period ending in late 1968. The loan provides US$ 1 million for agricultural equipment, US$ 250,000 for pesticides, US$ 1.5 million for spare parts (some of which would be for agricultural equipment), and US$ 1 million for lubricants (some of which would also be for agricultural machinery and equipment). Some funds remain to be disbursed under a previous commodity loan (664-H-026), including about US$ 650,000 for agricultural equipment. Other sources include Germany (fertilizers, seeds, livestock), Yugoslavia (tractors, pumps), Netherlands (livestock), and Austria (plant protection). Agri- cultrual inputs are also received as parts of foreign assistance given to projects (e.g., farm equipment and livestock), as in the IBRD loan to cooperatives, or in conjunction with foreign technical assistance activities (e.g., improved seed stock).

6.03 While it has not been possible for purposes of this working memorandum to identify with any degree of precision the levels or nature of the input needs over the next few years, certain potential developments should be noted. The current average applications of fertilizers in Tunisia are extremely low, and given the expected expansion in cooperatives (under the on-going programs alone) there should be a large increase in demand for fertilizers. This should follow the gradual improvement in farming practices resulting from the extension efforts which play such an important role in the cooperative programs. The introduction of new wheat varieties based on the Mexican dwarf wheats can be successful only if accompanied by a number of improved farming practices, including the application of relatively large quantities of fertilizers. The improved response to fertilizers generally found to accompany irrigated agriculture implies an increased demand associated with the larger acreage to be brought under irrigation within the next few years. As new varieties of crops are added, there may also be need for new kinds of equipment for seeding, for applying fertilizers, for levelling land to be irrigated, and the like. - 30 -

6.o4 From the standpoint of potential foreign assistance, it is therefore important that foreign exchange be available for the key inputs as the needs arise. It requires careful study to determine whether there still remain shortages of needed foreign exchange under the existing commodity loans, or whether the comments of officials cited above accurately reflect the present situation. The main point, however, is that lack of foreign exchange should not be allowed to become the bottleneck restricting increased use of modern inputs. As the general standards of husbandry begin to improve, in response to the efforts of increasingly experienced managers and extension persoinel, the demand for modern inputs should begin to rise correspondingly. This assumes comparable success in creating incentives for farmers to use the inputs. Altogether, it could also bring an expanding role for commodity assistance from abroad.

Source: IBRD Table 1

Production of Ma.jor Crops -- 1960-1966 (Thousand tons)

Crops 1960 1961 1962 1963 1964 1965 1966

Hard Wheat 360 201 321 529 350 429 300

Soft Wheat 79 42 72 123 81 100 49

Barley 137 50 103 261 130 180 80

Sub-total 567 293 496 913 561 709 429

Olives 554 189 221 443 430 272 92

Citrus 96 93 62 88 94 82 110

WIine Grapes 203 164 240 253 239 241 190

Artichokes 11 11 10 14 15 18 19

Potatoes 40 43 41 64 54 60 68

Peppers 33 46 50 52 49 56 67 Tomatoes 62 58 93 93 102 124 149 Sub-total 146 158 194 223 220 258 303

Source: Under-Secretariat of Agriculture Table 2

Fertilizer Imports

(Metric Tons)

Type 1960 1961 1962 1963 1964 1965 1966

Nitrogenous Fertilizers 12,016 12,798 13,511 26,284 25,008 16,513 20.1:2

Phosphatic Fertilizers 240 69 - 351 71 - 1/ - i/

Potassic Fertilizers 4,292 2,517 ,o498 5,145 6,513 1,750 35547

Other Fertilizers 641 1,418 1,987 2,727 2,153 110 _-/

Sub-total Imports 17,009 16,802 19,996 34,507 33,745 18,373 23,679

/ NIegligible quantity

Source: Under-Secretariat of Agriculture Table 3

Estimates of Phosphatic Fertilizer Use

1960 - 1965

(metric tons)

Type 1960 1961 1962 1963 1964 1965

Phosphate Rock Productio:u 2,101,000 1,982,000 2,097,000 293659000 2,751,000 390b0O000

Less: Phosphate Rock Exports 1,636,000 1,627,000 1,833,70" 1,971,X00 2,21b,700 2,2609200

Estimate of lomestic Use 465o000 355~,00 263,300 393,1S0 536,300 779,f00f

Superphosphate Production 150,000 160,000 173,000 18h, 000 199,000 320,000 Less: Superphosphate Expcrts 111,900 156,7CO 115,1CD 147,200 12h,800 2579100

Estimate of lomestic Use 38,100 3,300 57,900 36,800 74,200 62,900

SOURCES: Production - Under-Secretariat cf Agriculture Exports - Bank Economic Report, March 1967, Vol. II, Table 39. Table 4

TUNISIA: List of Agricultural Projects

Foreign Projects Estimated Total Investment Costs Financial On-Going Proposed Assistance Projects Projects As of Aug./67 (in 1000 dinars) Irrigation and Flood Control:

OMVVM (Lower Medjerda) 5,165 None Nebhana 20,000 USA Lacs CoUinaires 400 W. Ger. Cued Chiba 2,100 None Oued Lakhmes 2,600 W. Ger. Oued Masri 2,200 W. Ger. El Haouaria 1,300 USA Shallow Wells 3,300 W. Ger. Deep Wells 8,400 W. Ger. Reconversion of Oases 12,700 W. Ger. Oued El Abid (Upper Medjerda) n.a. None Souk El Khemis-Souk El Arba (Upper Medjerda) 13,000 None Ghardimadu (Upper Medjerda) 14 ,000 None Lake Ichkeul 33, 134 USSR (Fea.- sibility study only) Oued Zeroud 1,200 None

Agriculture: Production Cooperatives (UCP) 17,200 IBRD Production Cooperatives (UCP) 77,200 None Polycultural Cooperatives 12,234 None Service Cooperatives 6,970 None Training for Cooperatives 1,078 None

Forestry:

Reafforestation 2,566 None Forest Exploitation 648 None fisheries:

Modernization of Coastal Fisheries 6,o50 None

Source: Under-Secretariat of Agriculture Table 5

TUNISIA: Acreage and Investment Costs of On-going Irrigation Projects

(Excluding the Lower Mejerda)

Gross Total Investment Average Investment Project Acreage Cost Cost per ha (ha) (in D Nillion) (in D)

Nebhana 5,153 20.0 3,881 El- Haouria 770 1.3 1,688 Oued Chiba 975 2.1 2,154 Oued Masri 2,500 2.2 880 Oued Lakhmes 1,640 2.6 1,585

Lacs Collinaires 300 0.4 1,333 Shallow Wells 4,460 3.3 740

Deep Wells 14,483 8.4 573 30,281

Source: Computed from data supplied by Under-Secretariat of Agriculture Table 6

TUNISIA: Estimates of Additional Agricultural

Staff Requirements by 1971 - On-going Projects

Agri. Agri. Extension Coop. Irrigation Officers Assistants Workers M4anagers

Lower Medjerda (approx 10,000 ha) 8 10 20

On-going Projects (approx 20,000 ha) 16 20 40

Oases (approx 5,000 ha) 4 5 10

Cooperatives

UCP (Northern Region) (approx 400,000 ha) 24 60 10o 400

Polycultural (Central Region) (approx 1,400,000 ha) 16 32 140 400

Service Coops (Sahel) (approx 300,000 ha) 4 10 90 90

Total Requirements 72 137 400 890

1,427

Additions to Present Staff 280 1,400

N. B. Estimates of staff availability subject to variation

Source: Prepared by IBRD Mission from data supplied by Under-Secretariat of Agriculture. TABLE 7

TUNISI.: MISSION SUJGGESTIONS ON PROJECT PRIORITIES

aTATUS FINANCING REP4ARKS

1. First Priority

Irrigation:

OMVVM (Lower Medjerda) On-going Tunisia Study reccamended Nebhana " USA On-going project - to be ccmpleted by 1968 Lac collinaires " Germany t 1968 ;ued Ch-ba " Tunisia " 1969 u.: d Lakhmes Germany " 1969 *O'ed Masri Germany 1969 El Haouaria USA 1969 Shallow Wells Germany 1968 Deep wells Germany 1968 Reconversion of cases Proposed Not financed Requires economic feasibility studies Upper Medjerda--Oued El Abid " " To be studied as part of Medjerda Basin survey Upper Medjerda--Souk El Khemnis - Souk El Arba it Upper Medjerda--Ghardimaou

Agriculture:

Production cooperatives (UCP) On-going IBRD On-going project - organization phase tc be- '.tei69 Training for cooDeratives Prooosed Not financed Currently under discussion for UNDP financing

Forestry:

Forest exploitation Proposed Not financed Requires technical and economicas studies at this stage

r econd ?riority

Agriculture:

Polycultural cooperatives On-going Tunisia Rate of implementation depernis on availability of technical personnel Service Cooperatives Proposed Not financed "

,roduction cooperatives (tlCP) Availability of technical personnel a questin. Start of project may have to he deferred until completion of on-going UCP project Fisheries:

K:odernization of Coastal Fisheries Requires po ject preparation studies

ITI. Low Priority

Irrigati on:

Laxe Ichkeul Prooosed IISSR High cost irrigation juied Leroud Not financed High cost flood protecticn

--res try:

hafforestation .n-going .1unisia Foor eccroognic prospects as presently projected

Source: Status and Financing data provided by Under-Secretariat of Agriculture. ( S, S '~~~~~~~~~~~~~~~~~~~~~~~SOAI''

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OC T O EBl Re 19 6f IB RD-30 4 9 ANNEX 1 Page 1 REVIEW4 OF AGRICULTURAL PROJECTS AND PROGRAMS . ....7, T. TOSTSIA LOWER MEDJERDA IRRIGATION DEVELOPMENT

A. Background

1. The water resources of Tunisia are relatively meager. Annual rainfall exceeds 400 mm only in the northern portion of the country, in a belt 125 kIn wide by 225 km long. The Oued Medjerda lies within this belt, and is by far the largest river in the country. The iotal water resources of Tunisia have been estimate4 at 2-3/4 billion m annually of which 2 billion m3 is surface water1.. The Oued Medjerda accounts for about half of the surface water or about one billion m3 annually. The development of the Oued Medjerda basin is thus of critical impor- tance to the country.

2. The Office de la Mise en Valeur de la Vallee de la Medjerda (OMVVM), the autonomous agency carrying out the project, proposes development in tranches corresponding to the various national plan periods, as shown in Table 1.

3. The cost of the development for the tranche corresponding to the Four-Year Plan (1965-1968) was estimated as D12,445,950. Only D5,165,000 of this is directly related to irrigation of new areas (16,438 ha gross), and the Government of Tunisia is presumably seek- ing financing only for this portion at this time. Concurrent private investment would amount to D3,h59,000, of which the largest part is for machinery and livestock.

B. Location and Climate

4. The drainage basin of the Oued Medjerda is shown in Map 1. The "perimetre" under the jurisdiction of the OMVVM, with limits as shown in Map 1, is 310,000 ha in extent. The irrigable portion of the perimetre is considered to consist of 87,000 ha (gross), but as indica- ted above only 46,000 ha (gross) woud4 be developed by the end of the Ten-Year Plan. This extent of development of the lovrer valley is called the "Plan Minimal". It seems probable that limitations with respect to water supply will not permit an expansion beyond the Plan Minimal for many years.

5. Outside and upstream of the lower valley there are important zones of irrigable land that need to be considered becauso of possible undesirable effects (reduction of available water and increase of salin- ity) on the lower valley. WATith approximate limits as in Map 1, and subzones as in Table 2, the upper valley is considered to have about 33,000 ha and the middle valley about 7,000 ha.

1/ -/See Ref. 1. References are listed at the end of this Annex. ANNEX 1 Page 2

6. Average annual rainfall in the OMVVM perimetre is from 400 to 500 mm. Most of the rain occurs during the winter months, November through March. The relatively high winter rainfall is a favorable factor because it enables the leaching of accumulated salts, provided that artificial drainage is installed. Summer temperatures are high while winter temperatures are low. Frost occurs frequently, except on the coast. Wind velocities are often quite high, causing damage to crops at times and making windbreaks essential in many cases.

C. Major Works

Storage Dams

7. There are two storage dams -- one is the Nebeur Dam on the Oued Mellegue, and the other is the Ben Metir Dam on the Oued El Lill, a tributary of the Oued Bou Heurtma. Map 1 shows the locations of these dams.

8. The Nebeur Dam was completed around 1956 and cost US$13.8 million. It is of concrete, buttress-type, with a height of 65 m and a gross storage of 300 million m3. The structure includes a small power plant of 8,000 kw capacity. The annual power production is said to be 20 million kwh (Ref. 4, p.2). A matter that needs further investigation is the rate of siltation of the reservoir.

9. The Ben Metir Dam was completed in 1948. The city of Tunis has first claim to this water, which comes from a drainage area of 108 km2 via a conduit about 150 km long. Some water for irrigation purposes would be available but only during relatively wet periods of the year.

10. A dam is under construction on the Oued Kasseb. The USSR is financing this dam, and construction is being carried out by a Yugoslav ccntractor. The mission did not obtain information on the cost of this dam or its main characteristics, other than that the total storage was stated to be 150 million m3 , of which 80 million m3 is useful storage. The yield from the reservoir will apparently amount to 65 million m3. annually, of which 25 million m3 will be earmarked for water supply for the city of Tunis and 40 million m3 for irrigation purposes.

11. A major dam on the Oued Bou Heurtma has been studied by the French consulting firm of Coyne et Bellier, but studies of the Oued Bou Heurtma basin are still underway (Ref. 5, p.3). It is expected that the usable storage in the proposed reservoir, will be 160 million 3 m , with an annual yield of about 55 million i 3 of water of good quality. It is not clear how much of this water would be used to augment the supply of the city of Tunis and how much would be available for irrigation. Through German bilateral technical assistance, a preliminary study has been proceedin g of the Bou Salem subzone of the upper valley. As indicated in Table 2, this has a gross area of 20,000 ha, of which about ANNEX 1 Page 3

15,000 ha is net irrigable. Completion of the study is expected within the next month or two. It will take an additional nine months to complete an "Avant Projet" (feasibility study). It is understood that the preliminary study will also propose other sources of water supply for the Bou Salem zone, including groundwater and a storage reservoir on the Oued Rhezala, a tributary of the Oued Bou Hertma (see Map 1). 3 In this connection, Ref. 6 (p.65) states that from 40 to 50 million m of water annually from the Oued Bou Heurtma will be needed as a substitute for the saline water from the Oued Mellegue.

12. Two storage dams were studied by International Engineering Company (IECO) on two small tributaries of the Oued Medjerda near the upper end of the Ghardimaou plain. The Rarai dam would have a total storage capacity of 43 million m3 and height of 66 m. The Nemeur dam would have a capacity of 27 m3 and a height of 46 m (see Ref. 7). A recent report (Ref. 8) proposes the irrigation of 8,300 ha (net) in the upper part of the Ghardimaou plain with water obtained from three sources -- from the Rarai storage dam, from a diversion dam on the Oued Medjerda upstream of Ghardimsaou town, and from deep wells.

13. The Plan Quadriennel mentions a dam across the Oued Medjerda near Ghardimaou with a storage capacity of 200 million m3 and an annual yield of 120 million m3. However, this dam would apparently back up water into Algeria, and the status of the investigations of such a possibility is not known.

14. The Plan Quadriennel also makes mention of additional storage possibilities, of which one on the Oued Beja would have a yield of from 20 to 25 million m3 annually. Others on right-bank tributaries (Meliz, Siliana and Tessa) would have rather small yields, and the water would, moreover, have a high salt content.

15. The possible trans-basin diversion of water from the Lac Ichkeul basin is discussed below.

El Aroussia Diversion Dam

16. This major structure was completed in 1956 and cost US$7.5 million. It includes three flood-gates 11 m high by 12 m wide. The adjoining power house contains a single turbine with a capacity of 4,500 kw. The turbine does not operate during July and August because water flows are too low. Operation starts in September, but only during evening hours. The outlet supplying the main irrigation canal has a capacity of 13 m3/s.

Main Irrigation Canals

17. These canals, which have existed since 1958, include the North Branch -- capacity of 6m3/s, 30 km long -- and the South Branch -- 7.8 m3/s and about the same length. Six main pumping stations, with capacities varying from 333 to 980 liters per second, have also been in existence since 1958. ANNEX 1 Page4

Flood Control

18. The works already realized are considerable. The Oued Medjerda, from Tebourba to the sea, has a straight-line distance of 50 km, but the distance by river is about 80 km. The slope of the river is insufficient to carry flows in excess of about 800 m'/s, which is the estimated dis- charge for a 3 to 4-year flood. The river banks are generally 2 to 3 m higher than the adjacent land. Flooding occurs first on the left bank at intervals of about three to four years. When flood flows exceed about 1,200 m3 /s (10-year flood), the river overflows both banks.

19. Based on model studies performed at a hydraulic laboratory in Grenoble, France, a flood-control plan was developed involving river straigt- ening and the construction of dikes and a floodway to shorten the route to the sea and thus increase the carrying capacity of the river. Part of the scheme also involves transportation of silt to low-lying areas adjoining the coast, and to use this silt to reclaim land. Construction operations based on the plan have been carried out intermittently.

20. Reforestation and other soil conservation measures in the drain- age basin are also included in the long-range scheme for flood control.

Drainage

21. Because of the high salt content, as well as the high level of the watertable in many parts of the irrigated zone, artificial drainage by means of deep ditches and clay tiles is essential in many parts of the ir- rigated zone. About 4,000 ha of land have already been tile-drained.

D. Brief History

22. Investment in major structures for the lower Madjerda develop- ment totalled US$32.8 million up to the year 1959. Of this, US$21.3 million was for dams (Nebeur and El Aroussia, but excluding the Ben Metir dam which is primarily for water supply of the city of Tunis), while other wo.ks cost US$11.5 million under the following categories (Ref. 4, p. 11):

Main canals US$ 4.2 Lateral canals 2.9 Farm laterals 0.3 Drainage and flood control 2.7 Miscellaneous 1.4 Total: US$11.5 ANTEX 1 Page 5

23. Accomplishments to date are summarized in the following tabulation?

Development of irrigated land 16,161 ha Development of dry-land farming 7,730 Soil-conservation works 32,506 Aforestation 6,500

Total: 62,897 ha

24. The development of the irrigated land can be further broken down as follows:

Land subdivided into lots ("lottisement")

(a) Net irrigable 5,932 ha (b) Not irrigable 1,100

Land exploited in the form of communes (net irrigable) 635

Privately-held land

(a) Net irrigable 6,2h6 (b) Not irrigable 1,057

Land in villages and roads 1,191

Total: 16,161 ha

25. The number of lots involved in the lottisement is 957. The average lot size is about 7 ha gross, or about 6 ha net. The lots are grouped into 14 irrigation sectors and are served by service cooperatives.

26. In 1960, the first lottisement at El Habibia was supplied with water. An investigation made in 1966 indicated that the average annual grovs value of production was of the order of D150 to D220 per ha, and that the net family income for a lot (i.e., 6 ha net) where vegetables are grown was of the order of Dh00 per year (Ref. 2, p. 60). In addition to his lot, ihe typical settler has been provided with a house and a shed for several cows. The total cost for the land and buildings has been Dh,500, and is repayable in monthly instalments over 20 years.

27. The infrastructure works completed up to 1958 were paid for by the French Government-utilizing Marshall Plan Funds (Ref. 9, p. 2). There is thus no indebtedness accruing to the project as a result of these works. Several years ago a loan in the amount of US$5.6.ffiilAion-was' obtained from Kuwait, and this loan is reportedly fully disbursed. The terms of the loan are nct known to the mission. ANNEX 1 Page 6

E. Soils and Crops

28. A great deal of land classification work, generally following the standards of the U.S. Bureau of Reclamation, has been carried out over most of the irrigable zone of the lower valley. This program was actively sup- ported by the bilateral aid program of the United States. Grontmij, the Dutch consulting firm for OMVVM, also participated in this work. The lands were subdivided into four classes ranging from Class I (best) to Class IV (worst) (Report, Ref. 9). The soils specialist who prepared the report estimates the division of the irrigated zone into classes for the Plan Opti- mal approximately as follows: Classes I and II, 20 per cent; Class III, 40 per cent; and Class IV, 40 percent.

29. As previously explained, the net incremental area proposed for irrigation during the Four-Year Plan is 10,967 ha. The Grontmij economic analysis assumes a cropping pattern as follows (Ref. 3):

Vegetables 2,888 ha Fodder 3,848 Orchards h,231

10,967 ha

30. lWith respect to the area in vegetables, there would be 7 crops in 6 years as follows: artichokes 2, melons and cucumbers 1, tomatoes 1, peppers 1, other vegetables 1, and wheat 1. The yields per ha from the ar-ea under fodder are assumed to be 2,700 liters of milk, 320 kilograms of meat, plus surplus fodder (for sale) amounting to 1,200 fodder units. The area in orchards would consist of 40 per cent apricots, 10 per cent peaches, 10 per cent pears and apples, 20 per cent olives and 20 per cent other fruit. The cropping pattern within the same area at the present time is approxi- mately as follows: orchards 1,281 ha, vegetables 672 ha, with the remainder mainly in fallow or grain crops witX a few thousand hectares in low-yield-jg olives. Owing to the relatively high salt content of the irrigation water and the danger of a still higher salt content in the future (as discussed below), the assumed future cropping pattern and yields may have to be re- vised in any future appraisal.

F. Water Supply

Water Requirements

31. Water requirements have been estimated by the consultants (Grontmij) as follows:

Peak Requirement Annual Requirement in liters per in cubic meters second per Crop per hectare hectare

Vegetables 9,000 0.6 Forage 7,300 0.7 Mixed vegetables and forage 10,000 o.6 Orchards 3,0C0 0.2v Mixed orchards ncd vegetables 6,000 0.43 ANNEX 1 Page 7

32. In connection with data obtained on the Nebhana project it was found that a difference of opinion exists with respect to water require- ments. Although there is agreement on the total requirements for the year, the peak monthly requirement for individual crops as estimated by IECO (consultants for the Nebhana project) is 50 to 100 per cent higher than that estimated by the Tunisian technicians of Sous-Direction de l'Hydraulique et de l'Equipment Rural (HER). With respect to the peak monthly requirements of all crops, IECO estimates a value 50 to 60 per. cent higher than HER for the two main subdivisions of the project, and 10 per cent higher for the two subdivisions taken together (see Ref. 10). The peak monthly requirement is a critical matter in the case of the Lower Medjerda project from the point of view of both the availability of water and the canal capacity provided. Where pipe systems and/or sprinklers are proposed (as are being considered for parts of the Lower Medjerda project as well as for the Ghardimaou plain), peak capacity has a direct bearing on the investment cost. The question of peak capacity thus requires further study.

Water Availability

33. During the summer months, when the base flow of the Oued Medjerda drops to only a few cubic meters per second, the main source of water for the Lower Medjerda project is the Nebeur reservoir, the water from which has a rather high salt content. According to observations at the El Aroussia diversion dam the salinity during the months May through September usually varies between 2 and 3 grams per liter. *The maximum, observed in August 1961, was 3.4 grams per liter. The year 1966 is reputed to have been a rather dry year, but data are not yet available.

3h. Although it has been long recognized that available water and salinity are critical matters with respect to both the lower valley and the middle and upper valleys, a systematic analysis has not yet been made. Such an analysis would, of course, have to consider the quantitites of wate- required for the various irrigable zones, and also the reservoirs (both existing and future) and how they would have to be operated in order to main- tain salinity at levels that can be tolerated by the crops to be irrigated. A first attempt at such an analysis is that shown in Table 3, which has been extracted from a preliminary calculation made by HER. This analysis would appear to indicate that irrigation of 21,000 ha (net) in the lower valley would be possible provided that a salinity of 2.0 grams per liter is accept- able, but there are certain other important provisos as follows:

(a) That several left-bank reservoirs would have been com- pleted, presumably including storage dams on the Oueds Kasseb, Bou Heurtma and Beja. However, the date of completion of the Kasseb dam is not known, nor is the water availability known in light of possible diversions to the city of Tunis. The status of the Bou Heurtma dam, ANNEX 1 Page 8

and of one proposed on the Oued Rhezala, is uncertain. The Beja dam is apparently only an idea, and no sub- stantial studies have yet been made.

(b) That there would be an importation of 10 million m3 during the month of August from the Lac Ishkeul project. The preliminary calculation referred to above indicates that 3 the annual amount of the importation would be 48 million mi The Lac Ishkeul project is not yet started, and, in fact, its very high cost would cast doubt on its economic justi- fication. Moreover, the allocation of its waters is as yet undecided. (c) That irrigation in the middle and upper valley would be restricted to 5,000 and 7,000 ha respectively. The extent of irrigation in the middle valley, which has a gross area of about 7,000 ha and a net area (probable maximum) of 5,000 ha, is not know., at present. Neverthe- less, plans are actively underway to extend irrigation to cooperatives in this zone up to about 2,000 ha (net). According to a recent report (Ref. ll),water would be obtained by pumping from the river. The cooperatives involved are being financed in part by a recent combined IBRD/loan/IDA credit/.*With respect to the upper valley, as previously noted, the potential irrigable area is con- siderably in excess of 7,000 ha. 35. No mention is made in HER's preliminary calculation of the Ghardimktci. plain. The mission was told that a report by the consulting firm, Ralph M. Parsons, Inc., to be issued shortly, will recommend irrigation of 2,500 ha il the Ghardimaou plain with water obtained from deep tubewells. Six such wells were drilled recently. They are 22-½5 inches in diameter (13-3/8" casing), about 100 m deep, and yield up to 1,800 gallons per minute (110 liters per second) of good quality water (less than 0.5 grams per liter of salt).,. Earth canals, built by local hand labor, are in operation, and irrigation

1/ Plans for obtaining water from the river have not yet been approved by IBRD/IDA. A matter to be resolved is whether there is sufficient water in the river during the dry season.

2/ With respect to the yield of the underground basin, two figures were mentioned: 13 and 30 million m annually. ANNEX 1 Page 9 of several hundred hectares, mainly in vegetables, is already underway. From a brief field reconnaissance, there appears to be a fair possibility that irrigation of the Ghardimaou plain, if based solely on groundwater during the critical summer months at least, might have little effect downstream. This would be on the basis that water supply at such times would be obtained from underground storage within the deep aquifers from which little or no outflow occurs during the summer months. Stream gauges were installed about 1-1/2 years ago by Parsons, and it might be quite pos- sible from a study of the records to determine the downstream effect. On the other hand, the report (Ref. 8) proposes irrigation of a much larger area -- 8,300 ha (net) -- with utilization of surface water. Some of this surface water would come from storage, and some from run-of-river._1 The probability of undesirable downstream effects would, of course, be much greater with the larger development.

Possible Recovery of Urban Wastes

36. The Ariana-Soukra Perimetre, 500 ha in extent and located withir. the territorial jurisdiction of OMVVM, is using urban waste water from the city of Tunis for irrigation (Ref. 2, p. 49). Another estimate indicates that utilization of urban wastes is possible on a much gr3ater scale, of the order of an ultimate quantity recuperable of 50 million m annually for a3l cities in the country (Ref. 6, p. 89§. The nearness of the lower Medjerda valley to the main urban center of Tunis, which has a population (metropoli- tan area) of almost one million, would indicate that development of this source should receive further attention at an early date. It seems likely that the water would be of good quality for irrigation inasmuch as most of the Tunis water supply comes from the basin of the Oued Bou Heurtma, and the salinity should therefore be low. The cost of intercepting the sewage effluents of the city might be costly, but this would have to be compared with the cost of storage dams that could provide an equal amount of water. Such interception would, moreover, provide an additional benefit inasmuch as the present sewage outfalls of the city (in the Bay of Tunis in the vicinity of the Tunis-Carthage Airport) are an aesthetic nuisance.

The Lac Ishkeul Project 37. The drainage basin of Lac Ishkeul, which is northwest of the.city of Tunis and just southwest of the city of Bizerte (see Map 1), has a drainage area of 2,22 km and is in a region of relatively high rainfall. A prelimIii- ary study of the development of the water resources of this basin was com- pleted in 1964 (Ref. 12). According to this report, several storage dams would make it possibl3e to obtain a 70 per cent utilization of the annual run off of 356 million m from the basin, i.e., 210 million m3 annualay. Four

/ A pipe system is proposed. ANNEX 1 Page 10

storage dams were proposed to produce a total capacity of 276 million m3 of which 154 million m3 would be useful storage. The water would be used for 11,360 ha of irrigation, and for industrial water supply for the 'ilies of Bizerte and Menzel Bourguiba. The Bizerte-Menzel Bourguiba area has been proposed as a "free zone" with the intention of attracting large- scale industrial development, and the water supply would support such a development. Initially, 22 million m3 of water would be supplied annually for industrial water supply, to be augmented as a later stage of the project. At a later stage of the project, water would also be supplied tS the city of Tunis, the amount mentioned in the report being 28 million m . For this purpose, a conduit 85 to 90 km long and about 1.5 m diameter would be required. The main features of the initial project are listed in Table 4. The cost of the initial project would be about D33 million.

38. Although the 1964 report makes no mention of the diversion of water from the Lac Ishkeul basin to the lower Medjerda valley, such an idea is now being actively considered by the Tunisian authorities. A con- duit about 50 km long would be required for such a diversion, and pre- liminary studies of such a conduit will soon be undertaken by a Russian technical assistance team. The expected duration of the study is six months. According to the preliminary calculation by HER mentioned above, the total annual diversion from the Lac Ishkeul basin to the lower Medjerda valley would amount to 48 million m3

G. Requirements for Further Action

39. The complexity of the problems connected with development of the Oued Medjerda, and the close inter-relationships between development in different parts of the basin, make it unwise to consider any one region in isolation from the others. But recognizing that some develo.- mental activity can proceed before all questions are resolved, and desiring to minimize the delays in continuing the development already started in some areas, recommendations should be consistent with both the complexities and the need to continue developmental activities. Both aspects are dis- cussed in this section.

Study of the Drainage Basin of the Oued Medjerda

40. An overall study of the drainage basin of the Oued Medjerda has been proposed by various experts for many years. With the growing demands of water and the serious and complex problem of salinity, it seems clear that such a study is urgently needed.

41. To be useful, such a study should be oriented toward hydrologic, agricultural, and economic aspects. For example, the programming of costly storage dams should take into account not only their hydrologic and phy- sical characteristics, but also their optimum timing from an economic view- point. ANNEX 1 Page 11

42. The operation of the various facilities -- storage dams, tubewell fields (as in the Ghardimaou plain), and trans-basin diversions (as from the Lac Ishkeul basin) -- is bound to become increasingly complex over time. An adequate and competent organization is needed to install the necessary monitoring devices (e.g., continuous measurements of streamflow, under- ground water levels and salinity at strategic points), and to plan the oper- ation of the system on a day-to-day basis. It should be one of the respon- sibilities of the team making the study to take initial steps toward the creation of such an organization.

43. The duration of a study of this kind would be about three years. It is difficult at the present time to estimate the cost of such a study because this needs further discussion in Tunisia on matters such as the counterpart personnel available, equipment for hydrologic measurement, and the present status of the investigations of the various storage dams and underground aquifers. However, the cost should not exceed US$l million and might be as low as US$500,000, not including extensive subsurface ex- plorations for major dams and tubewell fields. A more reliable cost estimatc and description of the terms of reference for the study could be prepared during an earlier mission, proposed below.

Project Preparation for the Lower Medjerda

44. The estimated expenditure on the lower Medjerda development during the Ten-Year Plan is D29.2 million, broken down as shown in Table 5. Almost D6 million of this is for soil conservation and reforestation. Hand methods are mostly used for this work because this program also serves for unemployment relief. The expenditure that has been budgeted for the Four-Year Plan, shown in Table 6, would be D12,446,000. Of this, D5,165,0CC is the portion that is considered to be directly related to the development of the incremental irrigated area (16,438 ha gross or 10,967 ha net) to be developed during the Four-Year Plan. The mission requested information on the portion of these investments that would require foreign exchange, but such estimates were not available. h5. Private investments by landowners and cooperatives were estimated at D3,459,000, to supplement an investment of D5,165,000 by Government. This private share would cover the following purposes (Ref. 3, p. V-7):

Land levelling and irrigation ditches D 530,000

Farm machinery and equipment 695,000

Orchard establishment 880,000

Purchase of livestock 1,354,000

D3,459,000 .4NNEX 1 Page 12

46. Since the start of the Four-Year Plan in 1965, only D990,976 of the amount budgeted (D12,446,000) has been spent, and most of this is for the portion not related to the incremental irrigated area. The financial cost of the project that the Government wishes to have considered would, therefore, be little different from that indicated in the last column of Table 6. However, the tranche of the project ultimately financed may be different because, on the one hand, areas of poor soil may have to be eliminated, while on the other some additional costs might be included.

Further Requirements

47. A large amount of data and information on the Lower Medjerda pro- ject already exists. Given the complexities of the project, however -- e.g., concern over the adequacy of the water supply, the high salt content of the water, and the need to select an appropriate tranche of the project for financing -- a good deal of further analysis is necessary. In order to be able to determine the scope of a project there must be some agreement that developments in the upper and middle valleys will not proceed beyond some rate -- a rate determined by study and discussions with the Government authorities concerned.

48. The African Development Bank is considering financing part of the cost of developing the Lower Medjerda. The I.B.R.D. is planning to send a mission to define and appraise a proiect there for I.B.R.D. lending. In addition to analysis of the major problems and agreement regarding the rate of development in the upstream areas, there are matters which should receive particular attention during the further preparation and appraisal of this project. These would include the cropping pattern, marketing, manageme!t and construction methods. A UNESCO team has spent several years in Tunisia studying crops that are suitable to the saline conditions prevailing in the Medjerda Valley and in other parts of Tunisia. This team suggests that several of the crop? proposed may not be suitable. On the other hand, the team is optimistic regarding forage crops and artichokes. A great deal depends on the nature of the soils. If the prospects for reduction of salinity are not favorable, it may be necessary to eliminate some areas from the proposed project, at least until such time as there is reasonable prospect that some of the water storage developments can go ahead.

49.. With respect to marketing and prices, large tonnages of artichokes are now slated to be produced, as well as various deciduous fruits, mainly for export. The prospects for such exports will have to be examined care- fully. Much of the irrigated area would be in forage, and the tonnage of meat and milk that would be produced is, therefore, large. In their economic analysis, the consultants (Grontmij) determineQ an internal rate of return of 19 percent. This calculation, was, however, based on the cropping pattern described above and on current prices. While it is true that a r. market for meat and dairy products now exists in the nearby city of Tunis, it seems likely that this market presently consists in large part of middle- income consumers. The course of future price levels would, therefore, depend on the rate at which the middle-income market becomes saturated. ANNEX 1 Page 13

50. It is highly desirable, both for the project and for subsequent supervision by a lending agency, that an adequate system of accounts and auditing be instituted from the start. The aim should be to de- termine on a periodic basis (probably annually) the profitability of the pro- ject as a whole, and of the particular tranche to be supported by external financing.

51. Finally, with respect to construction methods, the following points need further study and clarification:

(a) The nature and scope of the infrastructure and on-farm works (Table 6) are such that international contractors would probably not be interested in tendering. If a loan or credit is limited to foreign currency, the com- ponent to be financed would be small. If indirect foreign costs are included, a rationale for their determination will be needed. (b) The system of irrigation distribution canals proposed is the same as already used in the project up to now. This is the so-called "canaux portes" system, involving precast and prestressed concrete elements for secondary and tertiary laterals. As the factory for manufacture of these elements already exists in the vicinity, there should not be an abandonment of this otherwise costly system. The quaternary laterals, however, for which earth ditches lined with concrete are proposed, could be installed with considerable savings in costs if these were constructed by hand 'Adthe lining omitted. Water losses should be negligible as the quaternaries are in use only one in seven to )14 days.

H. Recommendations

52. (i) Developments in one part of the Basin should not be considered in isolation from the others.

(ii) A Basin-wide study should be undertaken, based on terms of reference to be proposed by an I.B.R.D. mission referred to below. (iii) Meanwhile, some further development should take place in the Lower Medjerda. An I.B.ROD. mission will visit Tunisia to analyze existing data and to identify and appraise a project for consideration for I.B oR .D. financing. (iv) The rate of development in the Upper and Middle Medjerda should be restricted to a rate which would neither jeopardize the continuation of development in the Lower Medjerda, nor the work of the Basin-wide study. ANNEX). Page 14

REFERENCES CITED

1. Exploitation des Eaux Souterrains -- Tunisie. R. Ambroggi. FAO/UNDP. June 1967.

2. Developpement Rural de la Basse Vallee de la Medjerda; Grontmij, June 1967.

3. Economic Evaluation of the Four-Year Plan for the Development of Medjerda Valley; Grontmij, December 1966.

4. Preliminary Report on Soil and Irrigation Facilities of the Medjerda Valley Irrigation Project, Rodger B. Collons, December 1959.

5. Irrigation de la Plaine Sud Est de Souk El Khemis, HER. October 1966.

6. Plan Quadriennel, 1965-1968; Secretariat d'Etat au Plan et A 1'Economie Nationale. Volume II. May 1965.

7. Upper Medjerda Projects; Feasibility Report. International Engineering Co., April 1967.

I. Haute Vallee de lqa Medjerdah; Am6nagement Hydroagricole de la Region de Ghardimaou; lere Partie, Plaine de Ghardimaou. Direction de lHydraulique et de 1'Equipement Rural. July-August 1967.

9 End-of-Tour Report; Oct. 1959 to July 1966. William J. Davis, U.S. AID.

10. Evaluation Report of the Oued Nebaana Project. International Engineering Co., May 1961.

11. U.C.P. du Nord - Project B.I.R.D.; Perimetres Irrigable A Partir des Eaux de Surface; Avant Projet -- Memoire Explicatif. Direction HER, s/Direction du Genie Rural. August 1967.

120 Schema des Nesures Hydrobonificatives dans la Region du Lac Ichkeul; Comit6 d Etat des Am6nagements Hydrauliques et d'Irrigation Agricole de la Republique Socialiste Sovietique d'Ukraine; Kiev, 196h. ANNEX 1 TABLE 1

LOWER MEDJERDA DEVELOPMENT -- AREAS (hectares)

IRRIGATED AREA Soil Con- Gross Net servation Dry Land Oumula- Cumula- Total and Refor- Culti- Incre- tive Incre- tive Area estation vation ment Total ment Total

Preplan 28,435 22,500 667 5,268 5,268 3,816 3,816

2en-Year Plan

First 3-Year Plan 34,462 16,506 7,063 10,893 16,161 8,942 12,758 (1962-64)

Four-Year Plan 78,028 58,440 3,150 16,438 35,599 10,967 23,725 (1965-68)

Second 3-Year Plan 53,458 40,000 13,458 46,057 10,519 34,244 (1969-71)

Ten-Ysar Plan 166,000 115,000 10,200 40,800 46,100 30,400 33,500-/ (rounded)

?-roje* Minimal 194,500 137,500 10,900 46,100 33,500o/ (rounded)

?lan Optimal 40,900 87,000 29,500 63,000 (rounded)

1J Figure used in Ref. 2 (Figs. 12 and 13) ANNEX 1 TABLE 2

MEDJERDA VALLEY IRRIGABLE AREAS (in hectares)

Gross Area Net Area Covered by Probable Project Maximum Studies

UPPER VALLEY

Ghardimaou 13,000 10,000 8,000

Bou Salem 20,000 15,000

MIDDLE VALLEY

Oued Zarga, Testour. Sloughia 3,000 2,000

Medjez El Bab 41,0O0 3,000 1,000

LOWER VALLEY

Plan Minimal 46,000 33,000 33,000

Plan Optimal (increment over Plan Minimal) 41,000 30,000

TOTALS 127,000 93,000

Totals assuming that only the Plan Minimal proceeds in the Lower Valley 86,000 63,000 ANNEX]1 TABLE 3

MEDJERDA VALLEY

Water Requirements and Sourcesl/ Month of August

Water Requirements

Water Quality Net Area Water Requirements Postulated Zone (hectares) / (million m3) (grams per liter)

Bou Salem 7,000 11 1.6 Middle Valley 5,000 8 2.4 Lower Valley 21,000 33 Saline waste - 4

Total .33,000 56 lWater Sources

Water Quantity TWater Quality (million i3 ) (grams per liter)

Otied Medjerda, base flow 5 3.5 Mllgue reservoir 27 2.7 Left Bank reservoirs 14 0.6 Lac Ichkeul project 10 1.1

Total 56

lJ Basis of this Annex is mainly a preliminary calculation (table) received from the Direction de l'Hydraulique et de l'Equipement Rural (HER).

/ Mission's figures-assuming mater requirement of 0.6 liters/sec/ha or 157 mm for the month. ANNEX 1 TABLE 4

LAC ICHKEUL PROJECT

Main Features and Costs / (costs are in thousands of dinars)

Irrigated Perimetres

Area in ha Cost

Sedjenane 350 232 Djoumine 5,340 3,993 Menzel-Bourguiba 2,070 1,895 Mateur 2,200 1,695 Rhezala 650 336 Douimiss 750 329

Totals 11,360 8,480

On-Farm Development 4,336

Flood Control (Dikes and River Training) 2,871

Housing and Administrative Buildings 1,588

Storage Dams

Capacity in million m3

Sedjenane, 1st Stage 118.0 4,200 Djoumine 136.0 8,050 Rhezala 10.5 741 Douimiss 10.8 600 276 13,591

Industrial Water Supply

22 million m,3 annually in 1st Stage 2,084

Hydroelectric Station 18h

Total 33,134W

J From Ref. 10 for Variante III which is the recommended one.

2/ Total shown in Ref. 10 is D35,526,000 but this includes the second states for the Sedjenane dam and for the industrial water supply sc'ho,e. ANNEX)' TABLE 5

LOWER NEDJERDA DEVELOPMENT Projet Minimal Costs (in dinars -- 1960 prices)

Projeet Preplan 10-Year Plan Mnimal

INVESTMENTS Basic Studies 165,000 341,300 506,3n0 Soil Conservation and Reforestation 498,ooo 5,920,250 6,h18,250 Irrigation P6rimetre

Infrastructure / 2,822,300 9,865,100 12,687,p0C Public Services?.! 783,500 5,817,700 6,601,2nc On-Farm Works i 1,687,600 3,622,750 5,35C, (3

Livestock and Seeds 12,000 2,159,600 2,171,6'GC

OPERATING COSTS

Maintenance, Experimentation and Agricultural Extension 661,400 1,500,200 2C Total 6,629,800 29,226,900 35,8561,7C;

/ Flood control, drainage canals, irrigation canal system (primaries, secondaries and tertiaries), roads.

U/ Rural work centers, electrification, domestic water supply and rural housing. / Quaternaries, drainage ditches, land leveling, access roads, cattle sheds- Drainage of private land is included only during and after the Four-Yeas- Plan.

Source: Ref. 2, p. 53* ANNEX 1 TABLE 6

LOWER MEDJERDA DEVELOPMENT

Budget for Four-Year Plan (in thousands of dinars)

Portion for which External1 Total Amount Financing 3s Budgeted desiredzl

Topographic and Soils Surveys 172 18 172 8

Agricultural Development Experiments and demonstration plots 145 Improvement of livestock 940

Extension 343 1,438

Infrastructure Soil conservation 2,777 Major drainage works 750 423 Irrigation works 3,100 2,317 Roads 450 260 Rural centers 750 Maintenance 250 8,077 3,000

On-Farm Works?/ Housing 680 Drainage, land levelling, irrigation ditches and cattle sheds 2,080 2,080 2,760 2,080 12465 165

1/ According-to Ref. 3, figures in this column represent investments directly-related to the incremental irrigated area (16,438 ha gross or 10,967 ha --net) to be developed during the Four-Year Plan. As mentioned-inr-the text, the portion of these investments that are in foreign exchange have not yet been determined.

?/ For publicly developed land distributed to farmers through "lottisemert.." On-farm investments for other lands are not included. ANNEX 2 Page 1

REVIEW OF AGRICULTURAL PROJECTS AND PROGRAMS

TUNISIA

Irrigation Projects -- On-Going

This Annex contains descriptions of eight on-going irrigation projects. Since most of these projects are near ccmpletion and are not being proposed for extension beyond their present scope, the descriptions have been kept relatively brief.

1. Nebhana Project

(a) Project description

(i) Location -- The project area is located in the coastal areas north and south of Sousse.

(ii) Area covered -- The area to be irrigated totals 5,153 ha of which about 1,350 ha would be under vegetables, 970 ha under citrus, and the remainder to be planted with apricots. Irrigation perimeters are not concentrated, but are scattered throughout a much larger total area.

(iii) Current status -- Construction of the project started in 1962. The dam, which is about 80 km distant from the closest irrigation sector, was completed in 1966. The pipeline from the dam site to the irrigation perimeters will have a total length of about 220 km, and is expected to be completed by 1968. On-farm canals and laterals should be completed by the end of 1969. The Sous-Directiori des Grandes Traveaux (SDGT) is responsible for supervising the construction of the project. The project was also studied and prepared by SDGT in collaboration with Coyne & Bellier, who were responsible for the dam studies, and SOGETHA-IECO (USA) who undertook the hydraulic studies.

(iv) Technical features -- Technical features include con- struction of a dam permitting storage of 80 million i 3 , of which 27 million m3 will be used annually for irri- gation. A pipeline from the dam site will carry water to distant irrigation areas, but the reservoir supplies will not be sufficient for irrigation of all the projected area. Arrangements are therefore being made to supply a supplemental ten million m3 water from 12 wells. Drains will be provided on about 500 ha. A1]NiEX 2 Page 2

(b) Organization and MIanagement

SDGT is to be responsible for the operation and maintenance of the dam and the pipeline. Operation and maintenance of the remaining irrigation works would be the responsibility of service cooperatives to be established for the purpose. No provisions have yet been made for special staffing of the extension service in the irrigated areas.

(c) Cost Estimates

Total costs of the project are now estimated to reach about D 20 million (US$ 38 million), of which approximately half is in foreign exchange. Land leveling is included in these cost estimates, but on-farm development and plantation establishment costs are not. The water rates to be charged to farmers are still under discussion. The project has received financial assistance from the USA.

2. El Haouria Project

(a) Project Description

(i) Location -- The project is located at the eastern end of Cap Bon.

(ii) Area Covered -- The total area of the project is 770 ha, of which 600 ha are to be devoted to vegetable production and 170 ha to citrus production.

(iii) Current Status -- Construction of the project began in 1965. The citrus-growing sector has been completed, and the vegetable sectors are scheduled for completion by 1969. The SDGT has been responsible for studies and project preparation (in cooperation with the hydraulic services), as well as for the construction.

(iv) Technical Features -- Project works include the drilling of 22 wells, construction of one pump station, roads, land leveling and the establishment of wind breaks. The project area is to be irrigated by sprinklers.

(b) Organization and Management.

Maintenance and operation of the pumps and wells would be the responsibility of SDGT. Service cooperatives and individual farmers are expected to take care of the maintainance of other irrigation equipment. ANNEX 2 Page 3

(c) Cost Estimates

Estimates of costs total about D 1.3 million (US$ 2.5 million), with a foreign exchange component of abuut 25 percent of total costs. The project has received financial assistance from the USA.

3. Oued Chiba Project

(a) Project Description

(i) Location -- The project is located in Cap Bon, Northeast of Nabeul.

(ii) Area Covered -- The project area includes 500 ha for citrus development and 475 ha for vegetables.

(iii) Current Status -- Project construction began in 1969. The consulting firm of Coyne and Bellier prepared a report on the dam, and SDGT also contributed studies of the project.

(iv) Technical Features -- The project works include construction of a dam, with a reservoir capable of furnishing three million m3 of water per year. Twelve wells would add another two million m3 to the annual irrigation supplies. The system would also include a 30 km pipeline. Irrigation would be by sprinkler system.

(b) Organization and Management

Operation and maintenance of the dam and pipeline would be SDGT's responsibility, but maintenance of wells and small irrigation equipment would be the responsibility of service cooperatives and/or individual farmers. No specific provision for extension staff and/or preparation of on-farm development plans has yet been made.

(c) Cost Estimates

The project is being completely financed by the Government of Tunisia. Total costs are now estimated to be D 2.1 million (US$ 4.O million). ANNEX 2 Page 4

4. Oued Masri Project

(a) Project Description

(i) Location -- The project is located in the western portion of Cap Bon, east of the town of Grombalia.

(ii) Area Covered -- The project is designed to improve irrigation in an area of about 2,500 ha.

(iii) Current Status -- Dam construction was started in 1964 and should be completed by the end of 1967. The secondary canals are expected to be completed by early 1969. The SDGT is supervising construction, in addition to carrying out initial studies and project preparation. The consult- ing farm of Coyne & Bellier were responsible for the studies related to the dam.

(iv) Technical Features -- The irrigation scheme, which will 3 operate by gravity flow, will draw three million m of water from a reservoir to be established by a dam on the 3 Oued Masri, and will draw an additional three million m from wells. Irrigation water is to be transported through a pipeline from the dam site to the irrigation area, a distance of 30 km.

(b) Organization and Management

The organization to carry out operations and maintenance has not yet been decided upon, and plans for agricultural develop- ment of the area have not been completed.

(c) Cost Estimates

Total cost of the project is estimated at D 2.2 million (Us$ 4.2 million), with about 30 percent of costs as the foreign exchange component. West Germany is financing 50 percent of total project costs.

5. Oued Lakhmes Project

(a) Project Description

(i) Location -- The project is located approximately 120 km southwest of Tunis and 60 km northwest of Kairouan.

(ii) Area covered -- The total project area will be 1,640 ha, of which 740 ha is to be planted with fruit trees (apricots and peaches) and 900 used in a vegetable/forage rotation. ANNEX 2

(iii) Current status -- Construction started in 1963. The dam was completed in 1966, and the remaining works are to be completed in 1968. SCET prepared studies for the dam, and SDGT prepared the remaining studies. SDGT is also responsible for the construction work.

(iv) Technical features -- The concrete dam on the Oued Lakhmes will permit use of 5.5 million m3 per year. In addition to this water 1.5 million m3 will be drawn from six wells. A 12 km pipeline will transport the water from the dam saite to the irrigated area, and drainage will be provided through open ditches. Distribution of irrigation water will be through sprinklers.

(b) Organization and Management

SDTG is to be responsible for the operation and maintenance of major project works; Service Cooperatives will be responsible for minor irrigation installations.

(c) Cost Estimates

Total project costs are estimated at D 2.6 million, with a foreign exchange component of D 0.6 million. West Germany is financing the required foreign exchange.

6. Lacs Collinaires Project

(a) Project Description

(i) Location -- The project includes construction of dams in the hills near Bizerte and on Cap Bon.

(ii) Area Covered -- Total area covered by the project is 300 ha, all of which is to be used for vegetable production.

(iii) Current Status -- Construction of the project began in 1962, and is now scheduled for completion in 1968. SDGT has been responsible for the construction and supervision, as well as for the studies made in preparation for the project.

(iv) Technical Features -- The project calls for construction of five earth dams, three in the Bizerte region and two in the Cap Bon area, plus the canals to carry water to the irrigated areas.

(b) Organization and Management

Operation and maintenance of the dams will be the responsibility of SDGT; Service Cooperatives are to be in charge of maintenaneo of other irrigation works. Plans for staffing the extension services and Dromoting horticulturc- develcpiient have not been completed. ANNEX 2 Page 6

(c) Cost Estimates

Total costs are estimated at around D 0.4 million (US$ 0.8 million), with a foreign exchange component of about 30 percent. West Germany is financing about 40 percent of the total project costs.

7. Shallow Wells Project

(a) Project Description

(i) Location - The project is in areas of Cap Bon and the Governorat of Bizerte.

(ii) Area Covered -- The project includes an area of 4,460 ha, divided for cropping as follows: citrus - 440 ha; fruit trees - 502 ha; vegetables - 1,368 ha; forage crops - 2,150 ha.

(iii) Current Status -- The project was scheduled to begin in 1966. The Division de l'Hydraulique et de Mise en Valeur of the Under-Secretariat of Agriculture is to install the wells for private farmers. Credit to support this activity will come through the Banque National Agricale.

(iv) Technical Features -- The project covers 615 wells (with an average depth of 15m and a diameter of 4m), reservoir tanks, 495 pumps with a capacity of 100 m3 per day, 120 pumps with 200 m3 /day capacity, and primary and secondary concrete canals. Credit would also be extended for fruit tree plantation establishment and the purchase of livestock.

(b) Organization and Management

Operation and maintenance would be the responsibility of the individual farmers, who may get assistance from service cooperatives and/or the Office de Motor-culture. No decision has been taken on staffing requirements for the extension service.

(c) Cost Estimates

Total project costs, including expenditures for agricultural development, are estimated at D 3.3 million (US$ 6.3 million), of which D 0.74 million (US$ 1.4 million) would be the foreign exchange component. West Germany is financing about 50 percent of the total cost. Loans to farmers would be on 20 year terms at three percent interest. ANNl 2 Page 7

8. Deep Wells Project

(a) Project Description

(i) Location -- The deep well program covers perimeters in the Cap Bon area (grombalia, Tafelloune, Tazoghrane, Takelsa), the Kairouan plain, Central Tunisia (Sbeitla- Hadjeb-El Aioun), Gafsa and Nefta.

(ii) Area Covered -- The area covered by the project is shown below:

Total Citrus Fruit Vegetables Forage Cap Bon ------tin ha) ------

Grombalia 1,7h0 350 350 635 405 Takelsa 359 150 135 36 38 Tafelloun 680 ho 100 330 210 Tazoghrane 855 175 120 340 220 Sub-total 3,634 715 705 1,3h1 873

Kairouan Plain 6,434 - 2,870 1/ 184 3,380

Central Tunisia 4,415 _ 2,056 156 2,203 2/

Gafsa, Nefta n.a. - n.a. n.a. n.a.

Total: 14,483 715 5,631 1,681 6,456

(iii) Current Status -- The Division de l'Hydraulique et de Mise en Valeur, Under-Secretariat of Agriculture, is responsible for the execution of the various programs. Work started in late 1966, and about one-third of the project has been completed. Final completion of all works is expected by the end of 1968. All studies to be carried out by the Under-Secretariat of Agriculture have not yet been completed. Soil studies have been finished and hydrological studies are well advanced, but the planning of irrigation layouts has not been started.

(iv) Technical Features -- The programs include drilling wells with a maximum depth per well of 1,000 m. The project also-provides associated works and small water reservoirs, canals and laterals, and land leveling. Irrigation would be by gravity flow.

1/ Including 1,060 ha olives. 2/ Including 179 ha wheat, 104 ha pulses. ANNEX 2 Page 8 (b) Organization and Management

The wells of the Cap Bon area are intended to serve private farmers, and will be maintained by service cooperatives. The other irrigated areas are to be incorporated into Poly- cultural Cooperatives.

(c) Cost Estimates

Total cost of the deep well program is estimated at D 8.4 million (US$ 16.0 million), with a foreign exchange component estimated at D 1.7 million (US$ 3.2 million). West Germany is financing about 50 percent of the project costs. The cost estimates, by region, are as follows:

Total Foreign Exchange Local Currency ------(million Dinars) ------

Cap Bon 1.9 0.4 1.5 Kairouan Plain 3.3 0.7 2.6 Central Tunisia 1.6 0.3 1.3 Gafsa 0.9 0.2 0.7 Nlefta 0.7 0.1 0.6

Total: 8.4 1.7 6.7

Source: Under-Secretariat of Agriculture. ANNEX 3 Page 1

REVIEW OF AGRICULTURAL PROJECTS AND PROGRAMS

TUNISIA

Irrigation Projects -- Proposed

1. Lac Ichkeul Project

(a) Background

The area of Lac Ichkeul is located in northern Tunisia, south of the city of Bizerte. The lake is fed by the run-off of numerous small streams and creeks, the most important being the Oued Sedjenane and the Oued Djoumine. A fesibility study was prepared by the USSR finm UKRGUIPROVODKHOZ in 1964.

The project area of about 50,400 ha is near the major consumption centers of Bizerte and the industrial town of Menzel Bourguiba. At present, about 25,000 ha are dedicated to annual crops, 1,100 ha to tree crops, 9,320 ha to grazing land. The remainder of 15,000 ha is unproductive land. Irrigation is only practised on a small scale by private farmers and the total irrigated area does not exceed 300 ha.

Land in the project area is owned by about 3,000 . t' farmers, with most farms averaging only 5-10 ha. Live- stock development is hampered by insufficient fodder pro- duction.

The Ichkeul region is in the sub-tropical iHediterran- ean climate zone with hot-dry summers (30-31°C) and cool humid winters (7-9°C). Average rainfall is 600 mm, and most of the rainfall occurs during the winter months. The project area is on a relatively flat plain bordering the lake, and is presently subject to frequent flooding during the winter months.

(b) Project Description

The feasibility study considered four alternat-ives for the eventual irrigation development of the area.

The alternative recommended by the Consultants would construct four dams, with a hydro-power station (at the Oued Sedjeane dam) with a capacity of 1,200 kw. 3 The water available would amount to 154 million m , of which 108 million m3 would be for irrigation. The 1ATNNX 3 Page 2

irrigated area could be increased to 11,260 ha and 11,700 ha would be furnished with flood protection.

Principal works would include construction of four dams, 32 km of main pipelines, 27 km of main canals 8 km of primary pipelines, 22 km of primary canals, secondary and tertiary canals, flood protection (dikes and river training) a hydroelectric plant, houses and administrative buildings. No studies have been made on the drainage required. Irrigation would be by gravity flow.

Although firm plans for organizing the farmers have not been made, most of the 5-10 ha small-holder farms would probably be brought into production cooperatives. Farmers with acreage exceeding 30 ha would probably become members of service cooperatives.

(c) Cost Estimates

Total project costs, based on 1967 prices, have been estimated as follows:

Main Features and Costs

(in thousands of Dinars)

Storage Dams 13,591 Canals and other Works 8,h80 Flood Controls 2,871 On-Farm Development ,336 Housing and Administrative Buildings 1,588 Industrial Water Supply 2,084 Hydroelectric Plant 184

33,134

A 10 percent contingency provision is included in the above cost estimates. The feasibility report recommends a seven year construction period with annual expenditures as follows: YEARS

1st 2nd 3rd 4th 5tn 6th 7th

2.2% 10% 18% 22% 22% 18% 7.8%

(d) Organization and Management

Responsibilities for the project rest with SDGT of the Under-Secretariat of Agriculture. Future organization to be responsible for operating and maintain- ing the irrigation scheme has not been specified. ANNFX 3 Page 3

The report proposed to irrigate 11,260 ha, taking into consideration that soils are the limiting factor in determining the irrigable acreage. The recommended alternative would provide double cropping on about 6,550 ha. A summary of acreage under different crops, the yields and production is as follows:

PRODUCTION AND VALUES

Commodity Yield/ha Price/ton Acreage Production Value t Dinars ha tons Dinar'000

Citrus 20 30 1,850 37,000 1,110.0 Olives 4 60 1,000 4,O0 / 2h0.0 Fruit 8 50 350 3,h40O-/ 188.0 Grapes 6 50 200 3,6o00 180.0 Artichokes 11 50 2,286 25,1h6 1,258.0 Tomatoes 30 15 616 18,480 277.0 Peppers 15 40 805 12,075 483.0 Other Vegetables 15 30 1,788 27,160 573.0

1/ Including strawberries intercropped with olives 2/ Including grapes intercropped with olives

There would also be a large increase of forage pro- duction to permit a sizeable expansion of livestock pro- duction. Cattle for milk production would number 8,000 heads; beef cattle would number 16,000 head. In addition to cattle, about 78,000 sheep could be maintained. Pro- duction is assumed to reach 2h,000 tons of milk, 1,120 tons of beef, 285 tons of mutton, and 105 tons of wool.

(e) Benefits and Justification

The project does not appear to have an attractive. economic return. In order to compensate for the high in- vestment costs of D 2,350 per irrigated hectare, emphasis has been put bn.Vegptablet.prroductione Moreover.,; this.:'average cost per hectare does not include provisions for drainage. Since most of the project area's soils are heavy and drain poorly, construction of drains would be essential.

The emphasis on producticn of citrus and vegetables makes the project more attractive, but marketing the anticipated production might be very difficult. As envisaged, the project would yield an annual gross return of D 7.2 million, composed of D 5.8 million from irrigated agriculture, D 1.1. million from production in the flood protected areas, and D 0.3 million from livestock production. ANNEX 3

In view of-the-high cost and expected further increases due to provisions for drainage, interest during construction, and an increased contingency allowance, other alternatives for development of the area should be explored. The feas- ibility report mentions that aquifers with good quality water exist below the previously known ground-water resources. Exploration and eventual exploitation of these aquifers might be further studied.

To modify the prevailing reliance on citrus and vegetable production for the economic justification of irrigation. schemes, a pilot farm or research station might be establisn- ed in the Lac Ichkeul area to investigate the possibilities of less costly irrigation methods (i.e. hand-dug canals and laterals supplied from tubewells) and the irrigation agronomy of cereals, cotton and sugar beets.

2. Rehabilitation of the Oases

(a) Background

The oases in Tunisia have been established for many .>..- centuries, some of them dating to pre-Roman days in the arid south of the country. One can distinguish three types of oasis: (i) the coastal oases of Gabes and Zarzis; (ii) the intermediate oases about 10-L40 km distant from the coast; and (iii) the continental oases like Gafsa, Tozeur and Nefta, deep in the countryfs interior.

Annual rainfall varies between 90 to 175 mm, and the mean temperature from 19.3 to 21.3 c. The topography of the oases is favorable for irrigation development because it involves usually flat or gently sloping land, but soils are generally of poor quality. Sandy soils with a high gypsum content (15-30 percent) prevail. Salinity is very high, and water holding capacity low.

The area in oases of the three types is not large-- the oases of Gabes have an acreage of 7,888 ha; the oases of Medenine have 857 ha; and the oases of Gafsa have 6,843 ha. Present production concentrates on date palms and some fruit -- hananas, grapes, citrus, figs, pomegranates, apricots and olives. Production is only possible through irrigation, which makes use of archaic systems and methods.

Topographic surveys have been carried out for a total of 11,900 ha, and detailed soil studies mapped in scale of 1:10,000 and 1:20,000, have been undertaken on 7,800 ha. Some hydrological studies exist, covering about 60 percent of the oases. The studies were prepared by the Under- Secretariat of Agriculture in cooperation with SOGETHA. ANNIEX 3 Page 5

Detailed studies have not been made of agricultural development or of economic evaluation.

Financial requirements for completing the studies have been estimated at D 736,000, but no money has been spent on studies since 1964. Officials estimate that the studies could be completed with their own staff within two years, but foreign assistance would probably be necessary for the pre- paration of agricultural and economic studies.

(b) Project Description

The project would introduce early vegetable production in the coastal oases, improve livestock production in all the oases, and expand production of dates in the continental oases. The project would bring about changes in the land tenure system by introducing cooperative farming, thinning and rehabilitation of the date palm groves, and improved water management through remodelling of the canal systems, land leveling, provision of drainage, and exploitation of untapped ground water resources.

Project works would include mechanical felling of palms, drilling of wells, construction of canals and laterals, drainage ditches and land leveling. Agricultural investments would include palm and fruit tree plantation establishment and provision of livestock. All schemes would be based on gravity irrigation.

Water requirements have been studied but not in great detail. It is assumed that about 11,000 m3/ha would be required for a vegetable-forage rotation, and 6,100 m3/ha for winter forage production. Conveyance losses of water in the unlined canals are assumed to be around 25 percent, which appears to be low, especially in the sandy soils. It would be advisable to include a detailed study of water requirements, conveyance losses and irrigation efficiency in studies to be carried out. In regard to water quality, it can be stated that presently tapped aquifers are highly saline (6,000 ppm), but given the sandy soils' high permeability the crops selected seem to tolerate this high salt content.

Land tenure appears to be one of the most serious problems in the oases. The average size of holding is about 0.3 ha. Absentee ownership is high, and many small lots are not cultivated.

Agricultural research is presently carried out on demonstration plots near Gabes and at Tozeur under the auspices of INRAT. A 17 ha substation of the UNESCO project (Utilization of Saline Waters) has also been established at Tozeur, and small pilot schemes near Gabes and at Gafsa and Nefta have been initiated. Agricultural extension is limited to the pilot schemes. ANNEX 3 Page 6

(c) Cost Estimates

Total project costs are tentatively estimated at D 8.6 million, not including contingencies and interest during construction. Costs of additional studies have been included, however.

Foreign exchange requirements are estimated at D 1.7 million. An additional D 4.2 million would be required for plantation establishment and agricultural development. The foreign exchange requirements of the agricultural development have not been estimated by the Government, but these could be relatively high because they include inputs such as ferti- lizers, pesticides and mechanical land clearing. The following table shows cost estimates for the three different types of oases.

Estimated Project Costs

Agriculture Project Studies Wells Irrigation Drainage Dev. Total - - ______in '000 Diinars) ------

Group Gabes 538 1,135 4,395 605 2,159 8,832 Group Gafsa 181 343 825 240 1,771 3,360 Group Medenine 18 15 199 82 217 531

737 1,493 5,419 927 4 ,147 12,723

The length of the anticipated development period is not clear, but it is unlikely that more than 5,000 ha could be developed during the next four years, due to an acute shortage of extension staff.

(d) Organization and Management

Project preparation is the responsibility of the Under- Secretariat of Agriculture. No information could be obtained about the eventual organization of a project authority and/or the necessary extension services.

(e) Benefits and Justification

The value of total production after reaching full development is estimated by the Government to reach D 6.2 million per year. The net value after deducting present production of D 1.78 million, and production costs excluding water and rehabilitation charges amounting to D 1.8 million, would be D.2.62 million. ANNEX 3 Page 7

(f) Conclusions and Recommendations

The proposed project merits further consideration. Studies should be continued, with emphasis on completing the hydrological studies, and should be coordinated with the on- going groundwater survey. The groundwater survey may indicate possibilities of opening new lands for cultivation, with reduced losses of existing production which would be incurred by rehabilitation of existing oases.

Emphasis in development should be on development of the coastal oases because of the possibilities of producing early vegetables, the shorter development period for date palms, and good markets for all kinds of vegetable and livestock production from the coastal area tourist industry.

A marketing survey for vegetables should be included in the studies to be undertaken. Based on the outcome of this survey, and on soil and hydrological studies, vegetable production might be raised above the presently anticipated levels.

3. Ghardimaou Project

(a) Background

The Ghardimaou Plain is located in north-western Tunisia, near the Algerian border about 40 km south of the Mediterranean Sea. The plain is part of the Medjerda River basin and encompasses a gross area of approximately 14,000 ha. The principal stream of valley is the Oued Medjerda, to which the Oueds Rarai, Nemeur, Hadjar, HaDrma-u,atd.En3a arer tributaries.

Average annual rainfall is 448 mm, of which 81 percent falls during the seven winter months. Soil surveys and maps at a scale of 1:50,000 have been prepared by the Under-Secretariat of Agriculture. With few exceptions, the project lands consist of slawly permeable clay or clay-loam soils. Salinity and alkalinity are not a problem, and are not expected to become problems after starting irrigation.

Hydrological data on the Medjerda run-off exist, but no records have bean kept on its tributaries. Estimates have been made, based on correlation studies of precipitation and precipitation losses for the period 1930 to 1962. From this calculation, it has been concluded that the average annual runoff in million m3 is as follows:

Rarai 29.20 Nemeur 16.55 Hadjar 12.10 Hammam 7.71 Medjerda 166.39 ANNEX 3 Page 3

Wiater qualities of the tributaries considered for use in this project are good with respect to salinity hazards (an average 527 ppm), but the Medjerda shows 1,660 ppm during periods of reduced flows. The average suspended load of the tributaries has been assumed at 3 kg/m3 of flow.

(b) Project Description

The project would consist of irrigation of a net area of 8,300 ha, of which 5,850 ha would be used for intensive irrigationdC tree crops and garden produce and 2,450 ha would receive supplementary irrigation for a sugarbeet rotation. The project is based on the following available water resource studies:

(i) Study of surface water resources and barrage possibilities by the International Engineering Company (IECO);

(ii) Study by underground water by Parsons Engineering;

(iii) Estimates of availability of water from the Oued Medjerda.

The approach taken in this project consists of utilization of different available water eources, as follows:

(i) Local underground water sources would be used to supplement irrigation in the irrigated perimeters, thus reducing the cost of providing water transport installations. It is estimated that 25 drillirng sites would produce between 20 and 22 million m3 annually;

(ii) A barrage on the Oued Rarai would provide usable storage for 39 million m3 and an annual regulating capacity of 24 million m3.

(iii) Water drawn from the Oued Medjerda would be used only during the months of December to May, at which time the levels of salinity would be less than 1.5 g/liter. The annual average exploitation of Oued Medjerda water estimated for the project would be around 12.3 million m3 . Eventual deficits could be compensated in years of low flow by drawing supplies from the barrage on the Oued Rarai. ANNEX 3 Page 9

The overall quality of the water supplies resulting from a mixture from all sources would be less than 1 g/liter of salinity. The expected cropping areas would be:

Citrus 2,100 ha Various fruits 900 Market produce 2,850 Winter sugarbeet rotation 2,450

Total 8,300

(c) Cost Estimates

Total project costs, based on 1966 prices, have been estimated as follows:

Main Features and Costs (in '000 DLnars)

Barrage on the Oued Rarai D.6,200 Intake structures on the Oued Medjerda 280 Pumping station for Medjerda water 170 Exploration drilling 500 Reservoirs for daily accumulation 240 Irrigation conduits 2,150 Distribution in the irrigated perimeters 2,225 Land preparation 1,230

Sub-total 12,995

Studies, work supervision, land acquisition, and miscellaneous 1,005

Total 14,000

The average cost per hectare, equipped and prepared, is about D. 1,700

(d) Organization and Management

Responsibility for the project at the present stage rests with the SDGT of the Under-Secretariat of Agriculture. Plans for the future organization of the project area are not available in the project description.

Completion of the project water supply is estimated to cover eight years, but irrigation could start within the irrigation perimeters from the first years, before the completion of the barrage on the Oued Rarai. The barrage is scheduled for start of construction from the fourth year of the project. ANNEX 3 Page 10 (el Benefits and Justification

The available study estimates annual receipts at D. 3,180,000. Amortization Charges, including allowance for interest at three percent, would be D. 820,000 annually. On the bases used in the study, value added is expected to average around D. 140 per ha at full development.

(f) Recommendations

The decisions with respect to the full development of this project area should await the eventual findings of the Basin-lide development study, recommended for the Medjerda Basin. On a purely technical basis, some work could probably begin on the groundwater development aspects of the project before the Basin study is completed, since this does not appear to affect water availabilities elsewhere as a consequence of such development. However, more thorough preparation by the economic evaluation of even this limited part of the project is clearly required.

4. Souk El Arba-Souk El Khemis-Sloughia Projects (Upper and 1Middle Medjerde). (a) Background There are two other possible projects in the region of the Upper and Middle Medjerda. The plain of Souk El Arba and Souk El Khemis (east of the Ghardimaou area), and the Couloir de Sloughia (near the towns of Testour and Medjez el Bab). No reports or detailed information on the Couloir project were received.

Couloir de Sloughia

The area covered by the project would amount to about 1,100 ha, of which 420 ha would be planted with peach trees, 380 ha with apr-- cots and 3 ha of vegetables. The project has been studied in its techi- nical aspects by SDGTT. Technical features would include construction of a small dam on the Medjerda plus pumping stations. Irri- gation would be by sprinkler. Existing rough cost estimates indicate that the total cost would be about D one million, or D 910/ha.

Plain of Souk El Arba - Souk El Khemis

A total of about 18,000 ha could be irrigated in the plain. Irrigation development would be in two phases: the first stage, involving 2,100 ha, is already being considered for financing by West Germany, and is located at the eastern part of the plain, southeast of Souk El Khemis. If project construction starts in 1968, it could be completed by the end of 1969. The SDGT is presently responsible for all aspects of the project. ANNEX 3 Page 11 Rainfall in the plain averages about 480-500 mm annually, with relatively high precipitation during the winter months of November - May. The annual average temperature is 17.90C. The alluvial soils are considered suitable for the contemplated crops. Soils considered too heavy and difficult to work have been excluded. In the report prepared by SDGT, no indication is given about the chemical and physical characteristics of the soils. Hydrological recordings of the Medjerda run-off are available.

(b) Project Description

The first phase of irrigation development, as proposed by SDGT, would involve construction of a water intake and pumping station on the Medjerda, a main canal, a dam-reservoir, canals, drainage systems, feeder roads and wind-breaks. The report recommends irrigation by sprinkler. For the overall scheme, studies are still underway for the construction of a barrage at the Oued Bou Heurtma which is expected to yield 55 million m3 of good quality water per year.

Results of the groundwater survey have not been incorporated into the development program. Further, the possible impli- cations for the Lower Medjerda (ONVVM) through reduced fresh water flow and increased saline drainage water run-off into the Medjerda have not been taken into consideration. The German consultant firm of "?Agrartechnik" has conducted a survey of the entire plain and its possible irrigation develop- ment and this report should become available by the end of 1967.

Agricultural production on the plain would concentrate on a sugarbeet, hard wheat, soft wheat and forage rotation, which would occupy about 16,500 ha. Citrus wild be planted on about 500 ha, and other fruit trees (mainly peaches and apricots) would take up 1,000 ha. Livestock, with emphasis on cattle fattening would become a major industry in the project area.

(c) Cost Estimates

Cost estimates have been prepared for only the first phase. Total costs excluding contingencies and interest during construction, are estimated at D 1.11 million, or D 510 per ha. A breakdown into foreign exchange and local currency requirements could not be obtained.

Estimated average yields of 4-5t/ha for wheat, 5-7t for forage and 30-50t for sugarbeets appear optimistic. There is no economic calculation or justification, and no proposals for project organization. ANNEX 3 Page 12

(d) Conclusions and Recommendations

Development of the Upper and iddle Medjerda should be determined by the guidelines furnished by a comprehensive review of the Medjerda basin.

Oued Zeroud Project (Flood Protection)

(a) Background

The Oued Zeroud is one of the three rivers running in a westeasterly direction through the Kairouan plain in Tunisia's Sahel area. There are two other rivers, the Oued Merguellil and the Oued Nebhana in the same area. These three rivers cause flooding of the plain during the winter months when heavy rains fall in the mountain ranges. The Tunisian Govern- ment has already started to harness two of these three rivers, the Oued Nebhana and the Oued Merguellil, with US financed construction. The SDGT is responsible for carrying out the project.

(b) Project Description

A preliminary study was prepared by the French consultant firm of Coyne and Bellier in 1966. This study covers some technical aspects of the dam to be constructed, investigations of the geological formation at the dam site, and computation of the magnitude of floods. The study does not contain any economic analysis of the proposed project works, nor does it give any indication about size of the area influenced.

Project works would include construction of a dam with a reservoir storing capacity of 420 million m3 for the first phase. A second phase would be elevation of the dam from 50 to 60 meters, permitting storage of about 755 million m3.

(c) Cost Estimates

A very rough cost estimate prepared by the consultants indicates that costs for the first phase would amount to D 6.3 million, and the second phase would cost an additional D 2.1 million. No breakdown into foreign exchange and local currency requirements has been prepared.

(d) Conclusions and Recommendations

The nature of eventual benefits is very difficult to estimate because, in most years, flooding of the Kairouan plain seems to have only beneficial effects on the production of wheat. Only once every ten years is there a serious flood which might damage or destroy the wheat crops. It should be noted ANNEX 3 Page 13

that, in any case, wheat is a poor crop to grow in the area because the average yield rarely exceeds 400 kilos per ha. Furthermore, economic justification of the project appears to be more than doubtful because of the expected high silta- tion rate of the reservoir. The consultants estimate a useful life for the reservoir of only 18 to 20 years.

Source: Under-Secretariat of Agriculture. ANNEX 4 Page 1

REVIEW OF AGRICULTURAL PROJECTS AND PROGRAMS

TUNISIA

Agricultural Projects - On-Going

The two projects described in this Annex are currently on- going. The first, which is supported by an IBRD loan and an IDA credit, has just begun operating as a project, although many of the cooperatives covered by the project have been organized at an earlier period. The second project is not receiving assistance from abroad, and was started in 1964. Brief project outlines are provided below.

1. Production Cooperative Units (UCP)

(a) Project Description

(i) Location -- Northern governorates of Tunis, Bizerte, Beja, Djendouba, Le Kef and Nabeul.

(ii) Area covered -- 185,000 ha (consolidation) and 160,000 ha (new cooperatives establishment). Total - 345,000 ha.

(iii) Objective -- The project is part of a 10-year national program to integrate and develop one million ha of State and smallholder land within a cooperative system in the northern zone of Tunisia. Wheat is expected to be the major crop, supplemented by forage crops and livestock. The main operations would include replacement of fallow by forage crop production, establishment of centralized animal units for milk production and/or the fattening of sheep and cattle, production of tree crops, and vegetables in some limited irrigated areas. Net annual income on cooperatives is expected to rise from D.12 per ha to D 27 per ha at full development. Yearly value added is expected to reach D 2.8 million for existing cooperatives.

(iv) Development program -- The development program consists of three main parts. The first is a consolidation of the 213 cooperatives (about 185,000 ha) which were established prior to 1966. The second envisages the establishment of about 160 new cooperatives on about 160,000 ha during the period September 1966 to Septem- ber 1968. Finally, efforts would be made to maintain productivity on Office des Terres Domaniales (OTD) farms during the pre-cooperative stage.

The project is to be implemented over a four-year period but due to difficulties in setting up the Bureau of Control (discussed below) the project has been delayed one year. The establishment of cooperatives ANNEX 4 Page 2

by the Government has continued, however, and by the end of 1967, 370 cooperatives will have been established. The project is being assisted by ani1BRD loan of US$ 12 million and an IDA credit of US$ 6 million, commencing in 1967.

(v) Technical features - An important element in the project is the expected replacement of fallow by forage product- ion in the present mixed cropping pattern. Some technical output is expected from an agricultural research station and a livestock center already serving the area, and UNDP assistance will establish 2 research stations in the project area as a follow-up of an earlier project on experimental stations in Central Tunisia. The project will utilize modern farm machinery and minor irrigation equipment. There is an important need for farm build- ings, and for a revolving credit fund to finance purchases of livestock for fattening.

(b) Organization and Management

(i) In principle, the PAVA division of the Under-Secreta- riat of Agriculture is in charge of the technical control of the cooperative development program. But the government, at the Bank's request, has also set up an executive Bureau of Control with exclusive respon- sibility for supervising the management of the cooper- atives included in the project. The Bureau works under the Minister of Agriculture, but is responsible immediately to a national commission for agricultural cooperation.

(ii) The regional agricultural commissioners are in charge of project implementation. They are to be assisted by one agricultural officer and 5 to 6 agricultural assistants for each 20 cooperatives. In addition, there is to be one manager for each cooperative.

(iii) Nine expatriate experts (one economist, 4 agronomists, and 4 animal production specialists) have been appointed to the Bureau of Control and there are now five Tunisian counterparts to work with them. The Bureau will review feasibility reports prepared for all new cooperatives, and the budget plans for existing cooperatives. The Banque Nationale Agricole (BNA) cannot make disbursements unless the Bureau has approved investment programs on each cooperative. ANINEX 4 Page 3

(c) Cost Estimates of which Proposed Bank/IDA Total For. Exchange Financing (US$ million)

Existing cooperatives 9.8 1.9 4.2 New cooperatives 20.1 8.5 11.6 State farms 2.7 2.0 2.2

TOTAL 32.6 12.4 18.0-

Percentage 100 38.3 55.2

1/ of which farm buildings 3.5 farm machinery 9.6 irrigation equip. 3.4 imported bulls 0.1 feasibility studies 0.7 management 0.7

TOTAL 18.0

(d) Estimate of Revenues

(i) The cash flow projection for a typical cooperative of 1,000 ha net income estimates that for member will reach about D.40 in the first years and will rise to D 250 at full development. In this projection, subsidy elements have been withdraw.m from capital inputs, and a standard interest rates has been used (6 percent per annum).

(ii) The investment in the new cooperatives is expected to yield an annual rate of return to the economy of about 10 percent over a lifetime of 24 years.

(e) Stage of Implementation - No disbursements have been made so far but the Bureau of Control has approved some budget plans for short term credit to be financed by BNA's own resources. Tenders for farm machinery have been requested.

(f) Comments and Recommendations - Because this is an on-going project, in the early stages of implementation, only first impressions on the nature of future operating problems are presently available. Among these, however, is the problem of inadequate water supplies for livestock on many cooperatives, both new ones and those established for a longer period. While a serious enough deficiency for sheep and beef cattle, this is clearly a limiting factor for milk production. The problem ANNEX h Page 4

should not be insurmountable. Water can generally be supplied by either wells or the construction of small ponds to store run-off rain water, but these instal- lations require guidance and advice from technical personnel. Those provided through the Bureau of Control should afford some help in this respect. Another general problem concerns the kinds of forage to be used when cooperatives replace fallow with a forage crop. The "oat and vetch" hay currently grown in Tunisia under dry land conditions produces poor quality fodder, and further experimentation is required to determine better alternatives. Again, the Bureau of Control technical personnel could make an effective contribution by encouraging and guiding this type of experimentation.

Lack of experience in management of the cooperatives and lack of experience with modern methods on the part of members of the cooperatives, account for much of the poor performance by many cooperatives thus far. In some cases, the cereal yields on the cooperatives are lower than the yields on traditional farms in the same general area because of managerial inexperience. Cooperatives members are reluctant to put their livestock into cooperatives, with the result that many of the cooperatives do not have adequate stocks of livestock. In fact, forage has been sold by some, rather than used for their own herds. Since the major deficiency in situations of this kind seems to be experience in actual farm operations, rather than lack of formal train- ing, efforts must be made to increase the acquisition of the appropriate kinds of experience. These might take the form of a higher density of agricultural officers and assistants than now proposed, in order to increase the in-service train- ing opportunities for new graduates from all levels of agricultural education. It is also apparent that the lack of experienced managerial and extension personnel is a fact which could slow the rate at which cooperatives can be brought to the high stages of production currently projected.

2. Polyculture Cooperatives (Central Region)

(a) Project description

(i) Location -- Governorats of LeKef, Kairouan, Kasserine, Sousse, Sfax, Gafsa (excluding coastal area of Sousse-Sfax), and the most southern area (Annual, rainfall below 300 mm). ANNEX a Page 5

(ii) Area covered -- two million ha.

(iii) Objective -- The project is designed to intensify agricultural production on the basis of an expan- sion of fruit tree production (olive, pistachio, almonds), improvements in sheep production (e.g. a rotation system in the grazing area), and the creation of small irrigated perimeters (digging of wells).

(iv) Development program -- The annual rate of estab- lishment of cooperations is scheduled to reach 100 units (average size 3,500 ha). The invest- ments (for each 100 units) would be spread over a five-year period, as shown in the following table for each of the different aspects of coopera- tive development: Year 1 2 3 4 5

Cooperatives establishment x x x

Irrigation x x x

Soil conservation x x x x

Planting cactus x x x

Planting fruit trees x x x x x

There are 66 cooperatives presently in operation, covering 240,000 ha (12,600 farmers). The project started in 1964.

(v) Technical features -- The following table shows the anticipated changes in land-use:

Extensive Fruit Irrigated Cereals Grazing Trees Perimeter Total - ~ ~ ~~- - t p e r c e n t T-

Present situation 40 50 10 - 100

After development period 24 50 25 1 100 ANNEX 4 Page 6

The major technical feature consists of initiating a rotation system on the extensive grazing area. The grazing area would be divided into blocks of 500 ha, each of which would be subdivided into 15 rotational grazing plots plus one plot planted with spineless cactus. The latter would constitute a reserve forage area for use as needed. Depending on climatic conditions, the density of animals would vary from 0.4 to 0.5 sheep per ha. Cereals pro- duction would be confined to those areas most suited for this. Efforts would be made to promote the use of advanced cultivation techniques for cereal pro- duction. The irrigated area would be devoted to tree crops (60 percent), forage (35 percent), and food crops (5 percent).

(b) Organization and Management

(i) Preparation and supervision of the project is under the leadership of the PAVA (Division of Production and Extension) Under-Secretariat of Agriculture. The following organization table shows the various levels of responsibility for implementation of the project:

Ministry of Planning Ministry of Agriculture and Finance Division PAVA of Cooperation

Governorat: 1 Senior agricultural officer U.R.C.-/

(training, extension, technical assistance) (accounting, marketing)

U.R.D.3/: 1 Agricultural Officer 2 per 2 U.R.D. U.L .0C.J 1 Agricultural assistant

Cooperative: 1 Extension worker per 2 1 Cooperative manager cooperatives for each cooperative

(ii) The pattern of staff requirements (per each 100 cooperatives) would be as follows:

h agricultural officers (one for each two U.R.D.) 1/ U.R.C.: regional union of cooperatives 2/ U.L.C.: local union of cooperatives 3/ U.R.D.: geographical area of development. ANNEX 4 Page 7

8 agricultural assistants (one for each U.R.D.)

35 extension workers (one for each three cooperatives)

Assuming an annual rate of establishment of 100 cooperatives, the total needs would be: Year 1 2 3 4 5

Agri. Officers 4 8 12 16 20

Agri. Assistants 8 16 24 32 40

Extension workers 35 70 105 140 175

(c) Cost estimates

(i) Investment costs per ha would be as follows:

(Dinars)

Tree crops planting (dry) 160

Irrigation network 500

Planting of tree crops (irrigated) 400

Cactus cultivation 50

Soil conservation 10

The total costs for 100 units (350,000 ha) have been estimated as follows:

Irrigation Equip- Build- Soil Fruit Net Plan-Graz- Stud-ies-ment ings- conserv.Cactus Trees work tationsing Total ( in '000 Dinars )

Tota] Cost 176h 100 200 -1,750 250 8,000 1,400 320 50 12,234

Foreign exchange Compo- nent 80 50 20 _ _ 500 420 60 10 1,140 ANNEX 4 Page 0

The Government would provide 85 percent of the total cost in subsidies and loans to Cooperatives. The remaining 15 percent would be provided as self-financing in kind (family labor force).

(ii) The annual recurrent cost (per 350,000 ha) would include:

Extension (subsidies)

(Dinars)

Agri. Officers 6,000

Agri. Assistants 8,000

Extension workers 24,500

Total 38,500

Exploitation costs (per 350,000 ha) excluding family labor, would be financed by short term credits. These costs, by type of crop, are estimated to be:

(Dinars)

Tree Crops 130,000

Annual Crops 80,000

Forage Crops 100,000

Total 310,000

(c) Estimate of revenues (per 350,000 ha)

The present value added is estimated to be D 0.86 million. The project estimates that by the 15th year of development the value added would reach D 3.9 million, largely as a result of the new plantations and irrigated crops. Employment would increase by 1.2 million man-days.

(d) Stage of preparation

(i) Studies have already been completed for 12 cooperatives covering about 62,000 ha (e.g., Le Kef, Sfax, Kairouan). In addition, the UNDP project for the Central Region provided basic studies for the Kasserine region and part of the Gafsa region. ANNEX 4 Page 9

(ii) Studies are currently underway for cooperatives with a total of 600,000 ha, of which 370,000 ha are still under the supervision and control of the Offices of Sidi Bou Zid and Souassis. These studies were expected to be completed by the end of 1967.

(e) Comments and Recommendations

(i) This project is based, to a large extent, on the UNDP study which proposed an integrated development pro- gram for the Central Region. The area covered by this study totalled 2.2 million ha, and investigations were focussed on three regions covering only 900,000 ha, but detailed studies were limited to only one of these regions (Sbeitla-Hadjeb El Aioun). A pilot cooperative was established in 1965 in the Governorat of Kasserine, and the first results were encouraging. Another UNDP project, experimenting with various crops in the Central regions (three experimental stations), has been operating for four years, and has provided technical support to the UNDP planning project.

(ii) The proposed general pattern of development appears technically feasible. The Government is anxious to stimulate some development activity in this area in order to prevent inhabitants from moving to the North, which is already densely populated. On the other hand, the economic justification of the project rests mainly on an additional large production of tree crops (olive and pistachio). The prospects for olive prices are not particularly bright, given the general trends in exports of this commodity. The export pros- pects for pistachio are reasonably good if development programs for this crop are reasonably modest. But planting targets are 100,000 ha, or 7,500 tons of pistachio at full production, and this would be 60 percent of the current (1966-67) total would trade in pistachio.

(iii) It is relatively easy to project a rate of 100 cooperatives per year, but itis much more difficult to cope with a development program which concerns around 350,000 ha the first year, 700,000 ha the next one, and so on. The mission gained the impression that the regional officers wanted to follow the ambitious plan targets at any cost, but lack of adequate staff has kept existing cooperatives at a pace of development behind planned growth. A.§4NEX 4 Page 10

(iv) The mission suggests that this project could be supported with the qualification that priority should be given to areas with irrigation perimeters which are already under construction or operation, and that the pace of cooperatives establishment be reduced by about 50 percent in order to take account of staff requirements for other on-going development projects.

Source: Under-Secretariat of Agriculture. AJThN'ZX 5 Page 1

REVIEW OF AGRICULTURAL PROJECTS&AMJ WROA

TUNISIA

Agricultural Projects -- Proposed

This Annex contains brief project descriptions of three agricultural projects which have been proposed for future implementation. The first two of these deal with cooperative organization and expansion; the third describes a technical assistance project in support of the cooperative program.

1. Expansion of Production Cooperative Units (UCP)

(a) Project description

(i) Location -- Project is in the Northern Region, at Jendouba, Bou Salem, Haut Joumine, Menzel Bourguiba, Bou Arada, Le Sers, Djebel Abiod, Zaouiet Medien, Barbare.

(ii) Area covered -- 100,000 ha per year, starting in 1968, up to a total of 400,000 ha by 1972.

(iii) Objective -- The project is a continuation of the on-going cooperative project in the Northern Region, and would be developed along similar lines. The project would result in new cropping patterns to incorporate livestock development (i.e., a cereals/ fallow/ cereals rotation), and integrate the traditional sector with the modern. Gross output is projected to reach 400% of the present output value by the 20th year of development.

(iv) Development program -- Because investments would be spread over five years for each 100,000 ha, the total development period would cover nine years. Put another way, 100 cooperatives (average size of 1,000 ha per unit) would be established each year for four years, with each taking five years to complete.

(v) Technical features -- The table below summarizes the projected major changes in land use: .NTFX5 Pagee 2 Forages & Fruit Graz- Irrig. Cereals Fallow Legume Plants Trees ing Perimeter Total ------(perce-nt)------Present Situation 45 30 - 3 22 - 100 After Development Period 39 6 12 19 22 2 100

(b) Organization and Management

(i) The preparation and implementation of the project would be under the leadership of the Production and Extension Division (PAVA), Under-Secretariat of Agriculture. This Division would be also in charge of the technical supervision of Cooperatives. Management of Cooperatives is a responsibility of the Under-Secretariat of Finance.

(ii) The ratio of staff assignments would be one agricultura). officer for each 15 to 20 cooperatives, and one extension worker for each 3 cooperatives.

The total needs under the project would be as projected below:

Year 1 2 3 4 5

Agri. Officer 6 12 18 24 30 Ext. I^Jorker 40 80 120 160 200

(c) Cost Estimates and Phasing of Expenditures

(i) Investment expenditures for a single cooperative unit (1,000 ha) are estimated as shown in the following table:

Year

1 2 3 4 5 Total ------(in dinars) ------

Buildings 2,700 2,700 - - - 5,400 Plantations 1,220 1,220 1,220 1,220 - 4,880 Grazing 1,265 1,265 1,265 1,265 - 5,060 Soil Conser- vation 1,800 1,800 1,800 1,800 1,800 9,000 Irrigation 7,950 - - - - 7,950 Equipment 25,600 - _ _ _ 25,600 Animals 600 - - - - 600 Sub-Total 71t135 6,98 753 7,2U5 17,800 j90 Total of Self-Financing 10,830 (Family labor) Total Investment 69,320 NAIJTEX 5 Page 3

The total costs for the entire project of 400,000 ha have been estimated as follows:

Year

1 2 3 h 5 6 7 8 Total (in million Dinars)

Investment 4.1 4.8 5.2 5.7 1.7 1.0 0.6 0.2 23.3 Family Labor 4.3 Total 7h

(ii) Recurrent expenditures consist of the subsidy elements for agricultural officers and extension workers and annual exploitation costs. Staffing requirements have been fixed at six agricultural officers and 40 extension workers for 100 cooperatives (e.g., l00,OOOha), and the annual costs for such a staff have been estimated at D 34,800. Exploitation costs for the project as a wqhole rise from D 1.1 million in the first year to a level of D 5.2 million by the twenty-first year.

(d) Estimate of Revenues

The estimates of revenues, as well as the estimates of costs, have been modelled on the estimates used in the IBRD-financed on-going Production Cooperative (UCP) project. The anticipated rate of return is thus comparable to the on-going project, e.g., ten percent.

(e) Stage of Preparation

Each of the production cooperative units (UCP) is to be established within areas of geographic homogeneity known as URD (Unites regionales de developpment). The URD have already been identified, and to this extent the location of UCPs is also indicated. Soil, hydro-geological, and land tenure surveys are currently underway, and are scheduled to be completed for the first 100,000 ha by may 1968.

(f) Comments and Recommendations

Until the on-going Production Cooperative (UCP) project has been adequately established, it does not seem advisable to begin implementation of an expansion of the cooperative program in the Northern Region. The successful establishment of the on-going project is a first step, and the lessons learned in the course of this experience will be invaluable in the further expansion. The mission thus AIr\TEX 5 Pa-ge 4T believes that it is unlikely that the further expansion of the Production cooperatives (UCP) described above can begin until 1970, and that prior to this time all the efforts of the agencies involved should be directed towmard making the on-going project a viable and productive operation. 2. Service Cooperatives (Sahel Region)

(a) Project Description

(i) Location -- Governorat of Sousse

(ii) Area covered -- 300,000 ha

(iii) Objective -- This project is designed to intensify and diversify agricultural production through a rehabilitation of olive groves by pruning existing olive trees, by replacing some olive groves and cereals areas with fruit trees (apricots and almonds), and by some development of irrigation from groundwater sources. Each farmer would continue to cultivate and harvest his own land, but the cooperatives would determine the new patterns of development. Cooperatives would also assist the farmer with credit and marketing facilities.

(iv) The development program calls for the establishment of 30 cooperatives, covering about 100,000 ha, in each of three years. The development of each cooperative would include the following estimates of time required for different activities:

Rehabilitation of olive groves -- 5 years Planting of fruit trees -- 2 years Irrigation -- 2 years Soil conservation and grazing -- 2 years Twenty of these cooperatives were to be established by the end of 1967, but implementation of the project had not yet started at the time of the mission's visit to Tunisia. (v) A major technical feature involves the rehabilitation of existing olive trees. The proposal has been suggested by similar experience in Libya, and the estimates shown below are based on data from Libya. ANNEX 5 Page §-

Comparative Annual Production of one Olive Tree

(as percent of potential output)

Rehabilitation Rehabilitation Year New Planting (Libya) (Tunisia) 1~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 2 - 2 _ _ 3 10 - 4 - 20 5 8 5 78 34 9 8 17 45 100 93 20 70 100 _2 100

As the above table shows, the Libyan experience indicates that olive trees (assumed to be so old that current production is negligible) can be brought to full production in a 17-year period by rehabilitation methods which include severe pruning, hihereas newly planted olive trees would not reach the same production level until 25 years had passed. The actual rehabili- tation period depends on the original state of the trees, and for planning purposes the project description assumes that it will take somewhat longer (e.g., twenty years) to reach full production in Tunisia than has been the experience in Libya. The project will also encourage diversification of production by member farmers by enabling them to plant fruit trees, develop irrigation, and introduce rotational grazing in pasture areas. The major anticipated changes in land use are summarized in the following Table:

Present Future Difference ------(in percent) ------

Olive groves 34.0 35.0 +1.0 Fruit trees 0.7 3.5 +2.8 Cereals 28.0 11.0 -17 Irrigation 0.1 0.5 +0.4 Cactus - 3.5 +3.5 Grazing area 17.0 26.3 +9.3 Nonagricultural area 20.2 20.2 0 100 100' 0 ANMEX 5 Page 6

(b) Organization and Management

The PAVA Division would be responsible for implementing the project. In addition to the regional officer (governorat level&, staff requirements by the end of the third year would include four agricultural officers, ten agricultural assistants (one per U.R.D.), and 90 extension workers (one per cooperative).

(c) Cost Estimates and Phasing of Expenditures

(i) Investments in different types of activities, and the time periods involved, are as summarized below:

Rehabili- Fruit Irri- Soil Equip- Studies tation trees gation Cactus Cons. ment Total

Total cost (million Dinars) 0.13 2.55 1.56 0.72 0.50 1.20 0.31 6.97

Foreign exchange component (million Dinars) 0.07 - 0.10 0.22 - - 0.16 0.55

Investment period (years) 2 11 6 4 5 4 3 -

(ii) Recurrent costs have been estimated to include the extension personnel and the annual exploitation costs. Annual costs for agricultural officers, agricultural assistants, and extension workers would total D 80,500. The exploitation costs, to be met through extension of short term credit, would include D 180,000 for irrigation, and D 135,000 for maintenance of equipment, or a total of D 315,000 per year. Additional annual costs (e.g., upkeep of plantations, livestock, labor inputs on annual crops) would be met by the farmers' family labor. (d) The project proposal estimates that the value added under the project would increase two and one-half times over the life of the project. Employment in the project areas would increase by 1,800,000 man-days.

(e) The Government has already completed a review of the general economic features of the project, detailed studies covering an area of 90,000 ha (twenty cooperatives), and has received an inventory of olive groves in the project area prepared by SOGETHA. Studies of pedology, hydro- geology, soil conservation, and agronomy for an additional 210,000 ha (seventy cooperatives) are underway, and are expected to be completed by the end of 1968 or early 1969. ArE 'Am 5 Page 7

(f) Comments and Recommendations

Tunisia has not had any experience as yet with the rehabilitation of olive groves, but the results obtained in Libya are probably a reasonable guide to the actual possibilities. The estimates used in the project formu- lation appear conservative compared to the Libyan data. On the other hand, if the output from these existing olive groves can be increased to the extent estimated, the problem of marketing this addition to Tunisian supplies will arise, and the project does not consider future market prospects in estimating benefits.

FAO technicians reported that the technical aspects of the project were feasible, and its implementation could contribute to greater agricultural productivity in the Sahel region where opportunities for diversification are quite limited. It is therefore a project which deserves serious consideration, but it requires little foreign exchange and therefore from the viewpoint of the Con- sultative Group is of somewhat lesser priority.

3. Technical Assistance in Support of Cooperatives

(a) Project Description

(i) Location -- Governorat of Kasserine.

(ii) Area covered -- Approximately 6C0,000 ha.

(iii) The objective of the project is to assist the Government in preparing detailed plans for about 150 mixed farming cooperatives, training cooperators in land levelling, irrigation and livestock raising, training young cooperative managers in farm manage- ment and bookkeeping, and providing technical assistance to agronomists and extension agents of the Government in the Kasserine region.

(iv) The project has been drawn up to extend over a three-year period.

(b) Organization and Management

The headquarters for the project would be in the town of Kasserine, and eleven experts would comprise the project team. One group of six experts would be concerned with cooperative planning (one senior agrono- mist, one agricultural economist, two agriculturists, one irrigation specialist, and one livestock specialist). A.lzi-L 5 Page 8

A second group of five experts would assist the Government in the setting up of cooperatives and rein- forcing field staff in their extension work (three agrono- mists, one livestock specialist and one farm management expert). In addition to these a group of skilled workers at the foreman level, supervised by experts, would instruct the cooperators in land levelling and irrigation practices (five skilled workers).

(c) Cost Estimates

The total cost of the project would be about US$ 2 million, of which UNDP will be asked to contribute about US$ 1.1 million for the following items:

Requested UNDP Contribution

Years Total 1 2 3 (in '000 dollars) Personnel 321 306 297 924 Scholarships - 10 13 23 Equipment 45 10 20 75 Miscellaneous 18 19 19 56 Total 364 173 :09 1,078

(d) Stage of Preparation

A draft request has been submitted to the UN Resident Representative, and is reportedly under consideration.

(e) Comments and Recommendations

The mission feels this project deserves a high priority because it fits well with the recommendations on needs for technical assistance to cooperatives. However, the estimated rate of establishment of cooperatives seems ambitious (600,000 ha within a three-year period), and should probably be adjusted to be consistent with the availability of experienced managerial and super- visory personnel.

Source: Under-Secretariat of Agriculture. ANNEX 6 Page 1

REVIEW OF AGRICULTURUL PROJECTS AND FROGRANMS

TUNISIA

Forestry Project -- On-going

1. Reafforestation Project

(a) Project Description

(i) Location -- In the region of Mogods, covering the Sedjenane River valley (Districts of Matur and Sedjenane, Governorat of Bizerte).

(ii) Area covered -- Approximately 22,000 ha.

(iii) Objective -- The project is designed to develop plantations of fast growing species of trees in an area covered at present by a non-productive bush. The economic justification of the project depends on the installation of a paper pulp factory (30,000 tons capacity).

(iv) Development Program -- This project is already on-going. About 8,000 ha had been planted by 1966, and targets of the current four-year plan (1964-1968) were an additional 8,000 ha. The present pace of planting is about 1,800 ha per year, but officials still expect a total of 18,000 ha will be planted by the end of 1968. The total area suitable for reafforestation is 40,000 ha, or an additional 22,000 ha within a seven-year period after 1968. This implies a pace of planting averaging 3,200 ha per year in this period after 1968.

(v) Technical features of the project include hand clearing of the bush, and land preparation by tractors and mechanical ploughing. Seedlings are planted at a rate of 1,400 to 2,000 per ha. Fertilizers are used in the nearby planted area, and it is mechanically weeded during the first two years after planting. About three-fourths of the area is being planted in varieties of eucalyptus, with the balance in pine varieties. AlNNEX 6 Page 2

All these species have demonstrated an ability to grow fast. Experiments were started in 1959 in two stations located in the project area, and first results from the planting scheme were quite encouraging. Production of seedlings will require the establishment of two nurseries, each producing two million seedlings annually.

(b) Organization and Management

The Forestry Service operates the on-going project, and would operate a proposed broadening of the project. Staff requirements would be one senior forest officer. One forest officer, three forestry assistance, and nine rangers. These people are already available, and have been appointed part-time to the on-going project.

(c) Cost Estimates and Phasing of Expenditures

Detailed cost estimates are provided in a document prepared by the forestry service, and are summarized below:

1. Land investment (per ha):

Lining up and clearing D 25, of which 2.5 foreign exchange

Subsoil preparation and ploughing D 35, of which 25.0 "

Seedlings D 15, of which 1.8 "

Planting D 35, of which 9.0

TOTAL DllO, of which 38.3 "

2. Buildings (housing): Total -- D 73,000, of which D 26,400 would be in foreign exchange.

3. Roads and infrastructure: D 250 per kilometer of feeder roads, of which D 130 would be in foreign exchange. D 800 per kilometer of main road, of which D 445 would be in foreign exchange. About 220 kms of feeder roads and 25 kms of main road would be constructed within the seven year period. The phasing of total investments would be approximately the following: ATNEX 6 Page 3

Y e a r 1 2 3 4 5 6 7 Total (in '000 Dinars)

Land investments 330 330 330 330 330 330 440 2,h20

Buildings 4o 19 13 - - - - 72

Main Roads - - - 5 5 5 5 20 Feeder roads 7 7 8 8 8 8 8 54

Total 377 356 351 343 343 343 453 2,566 = =~~1CM= X= CZ_ == No estimate has been made of management cost. It has probably been assumed that this is included in the current budget of the forestry service, and that no additional cost will be due to the project. Recurrent costs have been estimated at D 7,500 per year for upkeep, and D 65,000 per year for exploitation costs after the 12th year of development.

(d) Estimate of Revenues

It is assumed that the price of wood, piled along the main road, would reach an average of D 3.2 per m3. About 3,000 ha would be exploited from the 12th year of development and the yield would be around 70 m3 per ha. The value of annual output would thus reach D 672,000.

(e) Stage of Preparation

The project could be appraised as on on-going schems.

(f) Comments on Recommendations

The present project is designed to supply a paper pulp mill with 30,000 tons capacity, but such a mill would not require more than 100,000 m3 of wood. This project would produce around 190,000 m3. An FAQ report on forestry economy, dated June 1966, states that the Government also intends to set up a paper factory which would be supplied with esparto pulp and wood pulps, with wood pulps imported during the first stage. There is no indication of the size of this paper factory. The Plan Quadrennial estimates domestic consumption of paper and boards would rise from 24,000 tons in 1964 to ANNEX 6 Page 4

32,000 tons in 1971. After allowing for existing capacities (i.e., a paper factory at Kasserine), domestic requirements would amount to less than 15,000 tons, divided almost equally between Kraft, printing and writing paper. Production of these grades would require a high admixture of long fiber pulp (about 50%) produced by Pinus varieties. With this information available, it is not certain whether the project is technically and economically feasible under prevailing conditions. There are further doubts about the proposed pace of planting, which seems extremely ambitious. Based on experience in other countries, 2,000 ha per year in one given area may be the maximum which can be handled properly. As a general conclusion, the project does not seem promising in its present form, and would not be ready for further serious consideration without further study of the industrial and marketing aspects.

Source: Under-Secretariat of Agriculture. ANNEX 7 Page 1

REVIEW OF AGRICULTURAL PROJECTS AND PROGRAMS

TUNISIA

Forestry - Proposed

1. Forest Exploitation Project

(a) Project Description

(i) Location -- Project is in the regions of Jendouba, Le Kef and Kasserine.

(ii) Area covered -- The total project area would cover 190,000 hectares, broken down by types of timber as follows:

170,000 Pinus Halepensis

15,000 Quercus Mirbecki

5,000 Pinus Pinaster

Total 190,000

(iii) Current Status -- Domestic timber production (20,000 m3) currently does not meet domestic consumption (157,000 m3). The value of processed wood imports is about D 3.4 million. Existing forest lands are not well exploited and preliminary works are lacking such as forest management studies (including inventories and felling cycles), feeder roads, and infrastructure. The Forestry Service started investi- gations in 1965 which involved some infrastructure (fire guards, feeder roads), and 80,000 hectares have been surveyed. On the basis of estimates on the annual output per hectare (1.25 m3 for Quercus and 0.65 m3 for Pinus), the possible annual output from the project area would reach 133,000 m 3 , with a value of about D 650,000. Part of this production could supply a board factory with 20,000 tons capacity, being established with financial support from IFC. The proposed project would be spread over four years, and consist mainly of purchasing equipment needed to meet targets of exploitation (65,000 m3 the first year to 130,000 m3 by the fourth year). ANNEX 7 Page 2

(iv) Technical features -- The equipment required for the implementation of the project would permit a semi- mechanized exploitation system. Operations would consist of felling, first processing (e.g., peeling, and cutting), logging, piling up and marking.

(b) Organization and Management

The forestry service would run the project with three technical sections. Training centers, financed by Finnish and German aid, would provide extension workers specialized in forest exploitation. After 1972, either cooperatives or a special body would take over responsibility from the forestry service. A pilot cooperative already exists in the region of Le Kef, but performance has been poor due to a shortage of skilled workers.

(c) Cost Estimates and Phasing of Expenditures

The phasing of expenditures is estimated as follows:

Year Total Invest. 1 2 3 4 5 Cost

Investment cost - Equipment 94.4 61.9 39.8 30.0 - 226.1

Exploitation cost-(Hired Labor) 40.0 64.8 80.0 80.0 80.0 3h4.8

(Inputs,fuel,etc.) 9.3 13.0 18.2 18.2 18.2 76.9

Total 143.7 139.7 138.0 128.2 98.2 647.8

The cost of technical staff is not included in the exploitation cost. A rough estimate of this would be about D 47,000 per year.

(d) Estimate of Revenues

The average value per m3 of wood after felling, cutting and piling up would be about 2.5 dinars. Since the value of standing wood is about one dinar per m3, benefits of the project would average 1.5 dinars per m3. In full production, annual net value of production may reach D 200,000.

(e) Stage of preparation

(i) Studies have been completed on the forestry economy and forestry exploitation (by FAO consultants); a report on exploitation of Pinus Halepensis has been ANNEX 7 Page 3

done by a Finnish forest officer, and a forest management study of 80,000 hectares has been completed.

(ii) Studies are underway on a forest management study of 110,000 hectares. This study would be completed by the end of 1969, and is being assisted by SCET and French technicians. Training of specialists for exploitation is being carried on by Finnish and German technical assistants.

(f) Comments and Recommendations

The quality of the upper echelon forestry staff is very good, and the staff is backed up by the new forestry research institute (financed through a UNDP project and run by a highly qualified staff of foreign experts and counterpart officers). However, the existing senior forestry staff have many other on-going projects, and some of them concerned with the national "Lutte Contre le Sous - Developpement". A less ambitious development program may therefore be necessary for this project. Since feeder roads are not included in cost estimates, additional information is needed to assess the state of the existing roads network, and additional costs will probably have to be brought into the project evaluation.

Source: Under-Secretariat of Agriculture. ANUIEX 8 Page 1

REVIEW OF AGRICULTURFLL PROJECTS AND PROGRAMS TUNISIA

Fishery Project -- Proposed

1. Plan for Modernization of Coastal Fisheries (a) Project description

(i) Location -- Coastal fishing areas of Tunisia

(ii) Objective -- The project calls for replacement of existing sail boats and row boats in the fishing fleet by 3,000 motor vessels, thereby increasing the productivity of the fishing fleet, the value of the catch, and the employment of persons in fishing. The coastal fishing fleet, according to a survey taken in 1963, then included 486 motor boats, 401 row boats, and 3,332 sail boats.

The motorized vessels would be built in Tunisia. The hulls would be made of plastic, for which raw material would be imported from abroad. Three different sizes of vessel are contemplated:

1,500 vessels of 6 meters, with motors of 11 to 13 horsepower, and carrying crews of three.

1,000 vessels of 8 meters, with motors of 30 horsepower, and carrying crews of four to five members.

500 vessels of 10 meters, with motors of 50 horsepower, and carrying crews of six.

(iii) Development Program -- Vessels would be constructed in the shipyards of the Office National des Peches (ONP). The project description does not contain any schedule for construction or placing in operation of the motor- ized vessels.

(b) Organization and Management

(i) The project would be carried out by the ONP. The vessels would be sold to the fishermen in installments by means of deductions withheld from sales of fish to the ONP. To ANNEX 8 Page 2

vLLuvLaLu unu poycnuo±g.Lfa r ±6iU±uarx 0± 2ishermen to purchasing the new vessels, the ONP would bring up the present vessels owned by the fishermen. Such purchases by the ONP would be covered by subsidy from the Govern- ment.

(c) Cost Estimates

(i) The estimates of cost for the hull, motor, equipment, and variable operating expense, by size of vessel, are as shown below: Cost Elements in Dinars) Hull Motor Equipment Variable Expenses 6 meters 660 750 190 150

8 meters 900 1000 300 250

10 meters 1200 1200 500 400 Estimated useful life periods are 10 years for the hull, 5 years for the motor, and 3 years for the fishing equipment. (d) Estimate of Benefits

(i) Benefit estimates reflect data from a fishing cooperative at Ghar El Melh, and on this basis the project anticipates that the average annual catch per person would rise from about 0.6 tons in 1965 to 1.5 tons with motorized vessels. Since the best fishing areas lie at least 60 miles from the coast, and motorized vessels would permit fishermen to work in these distant waters, it is reasonable to expect some increased productivity per man. Moreover, the types of fish to be caught would include some of the higher valued varieties, which are suitable for export, and this should increase the value of the catch per man. (ii) Although the number of vessels in operation after the modernization is completed is expected to be less than are in operation at present, the larger average crew size per vessel is expected to raise the total number of men employed in coastal fishing. ANNEX 8 Page 3

(e) Stage of Preparation

(i) Two general studies of fishing in Tunisia have been carried out. One by SOGETHA, is entitled: "Possibili- ties for Development of the Fishery Sector in Tunisia", the second by SCET in cooperation with B.C.E.O.M.,, is entitled: "A Group of Studies for the Development of Fisheries." These apparently deal with the general fishery prospects, given the availability to Tunisia of fishery resources. Details for the actual project are still quite generalized, and much additional work on the economic evaluation and organization and management work will be required to establish the economic viability of the project for foreign financing. Available infor- mation does suggest, however, that good fishery opportu- nities are at hand. It is not clear from the existing information whether a training program for fishermen would be necessary, or, if necessary, how this would be carried out.

(f) Comments

(i) Since much further project preparation seem required, the project is not ready for immediate consideration. However, this project may be implemented fairly readily if the economic viability can be established by further study, and if the organization and management can be provided with existing personnel resources.

Source: Under-Secretariat of Agriculture. ANNEX 9 Page 1

REVIEW OF AGRICULTURAL PROJECTS AND PROGRAMS

TUNISIA

Estimates of Bilateral Assistance to Tunisia

1. Information was received from the Government of Tunisia con- cerning the economic assistance received from different sources but no effort was made to verify the information from other sources. It is, therefore, only indicative of the general nature and distribution of foreign assistance. It indicates the levels and types of assistance offered by different governments and international agencies in the two most recent years of 1965 and 1966. Assistance received prior to these years has been shown as a total for the period up to December 31, 1964. Foreign assistance has been summarized in three different ways in order to illustrate its different aspects -- i.e., bilateral aid to agriculture in the form of loans and credits (Table 1); bilateral aid to agriculture in the form of grants, subsidies, technical assistance and counterpart funds (Table 2); and expatriate personnel working in agricultural sub- sectors in 1966 (Table 3). A few words of caution and explanation are offered for each of the tables because the information provided was not always comparable, and the tables contain sane overlapping, some omissions, and some inconsistencies. For these reasons it is important to recognize that the figures shown cannot do more than provide a very general impression of foreign aid in Tunisia.

2. Table 1 shows the amounts provided to agriculture in Tunisia through loans or credits, both project-related and in commodity form. U.S. commodity loans for agriculture are actually parts of larger loans, and the amounts shown are therefore estimates of the portions which are to be used for commodities useful in promoting agricultural development. The amounts shown may be understatements to some extent because some commodities not classified as part of the "agricultural loan" may have had indirect benefits for the agricultural sector (e.g., lubricants). The Government of Tunisia did not provide estimates of disbursements to date by calendar year under these commodity loans, and U.S. sources pro- vide disbursements only on a U.S. fiscal year basis. The agricultural portion of the loan is therefore all that has been shoin. Disbursements under the German loans have been provided only as totals for the period up to December 31, 1966, and not for individual calendar years.

3. Table 2 shows all foreign assistance to agriculture in forms other than loans or credits. The Table understates the amount of assist- ance given by some countries, for the monetary value shown does not always include the services of tecimical personnel provided. Some countries, in fact, have provided technical assistance personnel ANNEX 9 Page 2

(e.g., Finland, Bulgaria, Poland, Czechoslovakia, Yugoslavia, Canada, Switzerland, Italy, and the United Nations), but no monetary value for these services was reported by the Government of Tunisia. Nothing is therefore shown for these countries in Table 2.

4. The Government of Tunisia has indicated the ultimate size of assistance programs for some countries, but has not given this infor- mation for others. "Program totals" have therefore been included in Table 1 and 2 where these have been provided to the mission. Expen- ditures for technical assistance by the U.S.A. have not been given on a calendar-year basis, but have been shown in Table 2 as total expen- ditures up to December 31, 1966. Technical assistance estimates for France are the amounts agreed upon in each year, rather than actual disbursements during that year. Actual disbursements may thus be spread over a period greater than the year for which they have been reported.

5. Finally, Table 3 is an attempt to indicate the size and distribution of technical assistance personnel in Tunisia in 1966. Some of these expatriate personnel were provided by funds included in the technical assistance estimates shown in Table 2, but as noted in para. 3 above, the costs of some technicians' services were not included in the financial estimates of technical assistance shown by country of origin. Further, some of the personnel listed in Table 3 were technicians hired directly by the Government of Tunisia, and the cost of their services was not part of the technical assistance pro- grams of their own countries. T4ith the exception of estimates of United Nations, Swedish and U.S.A. technical assistance personnel, the nationalities and occupations of technical personnel given in Table 3 are as shown in the records of the Under-Secretariat of Agriculture. Since U.N., Swedish and U.S. technical personnel are not paid through the Government of Tunisia, their names and occupations are not avail- able from the Government's records. For this reason, estimates of the number of technical personnel furnished by these three sources are based on information supplied directly by them. rUNISIT;'.i3ilat'ral Aid Agric-:tural Projects

-.- - - - Loans and Credits -

Program Total Utilized by 12/31/64 Utilized during 1965 Utilized during 1966 Denmark (D. kroner) (US$) (D. kroner) (US$) (D. kroner) (US$) (D. kroner) (US$) Refrigerating 3quipment 1,700,000 2L6,160 1o,,2,,95 220,689 Milk and Cheese Equipment 3,000,000 434,0oo 1,026,862 148,690 Agricultural Equipment 173,890 / 25,179 Sub-total: 4,873,890 705,739 2,550,957 369,379

Germany (DN) (US$) (DM) CUS$) CDM) (US$) (CM) (US$) Construction of 3 barrages 12,000,000 3,000,000. 2,083,731 520,933 Fishing Port at Mahdia 4,700,000 1,175,000 3,312,690 828,173 Irrigation and drinking water 31,000,000 7,750,000 3,156,510 2 789,128 North.rn Tunisia Irrigation 20,000,000 4 5,000,000 Dam at Bir M'Chsrga a,000,00 / 2,000,000 Sub-total: 75,700,000 18,925,000 8,552,931 2,138,234

Kuwait (K. Dinars) (US$) (K. dinars) (US$) (K. dinars) (uS$) (K. dinars) (US$) Lower Medjerda Project 2,000,000 5,600,000 1,092,129 3,057,961 752,264 2,106,339 155,607 435,700 Sub-total: 2,000,000 5,600,000 1,092,129 3,057,961 752,264 2,106,339 155,607 435,700

Netherlands (Guilders) (US$) (Guilders) (US$) (Guilders) (US$) (Guilders) (US$) Purchase of cattle 2,000,000 552,400 1,293.452 357,251 Sub-total: 2,000,000 552,400 1,293,452 357,251

Sweden (S. kroner) (US$) (S. kroner) (US$) (S. kroner) (US$) (S. kroner) (US$) Fishing port at Kelibia 7,200,000 1,391,760 271,553 52,491 88L,007 170,879 3,2L5,858 627,424 Study of Cap Bon 2,625,000 507,1.3 _ _ 1,101,719 212,962 Sub-total: 9,825,000 1,899,173 271,553 52,491 38L,007 70,37 L,3L7,577 840,386

1/ Started in 1967. 2, Tocal spent by 31/12/1966. ,' Combined expenditure with Djerba airfield. - . l :/ Agreement signed in 1967. Source: Government of runisia dat- only. TUNISIA: Bilateral Aid to Agricultural Projscts

Loans and Credits

Program rotal Utilized by 12/3164 Utilized during 1965 Utilized during 1966

USA C(US$) (US$) (US$) (US$) Project - related:

Nebhana 664-A.005 18,000,000 4,230,196 3,855,075 h,686,700 BHA 664-A.007 5,000,000 6 4,3 9,1t25 293,7742 290,054 Drinking watetr 66i4_H.012 2,00,000 356,844 7,667 132,121 Agr.r qipent 664_4H.016 6,500,000 2,236,406 1,507,858 oI0lege of 7nottr Maria, 2,000,000 23,31h0 Iefiar .ior,L _- fEUMBani 1,000,000 993,590

-U-oria..i:. Equsp. " 800,000 675,o76

Pumps , 615.000 482,949

Sub-total.: 36,315,000 11,108,080 6,392,890 6,640,073

Tractors 664_-U ll 1,000000

Agri! M;terials 664-H-0 14 1,000,000

Agri. 4achi.nery 664-H-019 115,843

Agri. Materials 664-H-026 1,000,000

Insecticides >Fertilizers 600o,00

Pumps " 3-1,870

Well driUing equip. 532,733

Sub-total:

U.S.S.R. (Rubles) (US$) (Rubles) (U0S) (Rubles) (US$) (Rubles) (US$) Dam on Oued Kasseb 3,971,968 14,369,165 2,127,659 2,340,425 1,421,116 1,563,228 Lake Ichkeul (research, studies, dam constnaction) 3.445,500 3.790.050 2.2B1,883 2,510.071 231 254 Sub-total: 7.417,468 8.159.215 4.409.541 4.85o0496 1.421.347 1,563.4B2

Yugoslavia (US$) (US$) (US$) (US$) Ellouhoum Abattoir 624,796

165 Tractors 349,470 178,9911 135,529 10 Fishing Boats 906,000 805,400 Irrigation pumps, pipes, drilling equip. 127,21,5 111L,520 Sub-total: 2.007.511 1.098,91T 135.529

i/ 3tarted in 1967.

Cource: Government of runisia ±t.a onli. . ANNEX9

rUNISIA. Bilatorml Aid to Agriculture

Granta, Subsidies, Technical Assistance AndCounterpart Funds

Program Total Ittilised by Utilized in Utilized in 12_/ZLL6h 1965 1966

(T.Dinars) (US $) (T.Dinars) (US $) (T.Dinars) (IIS ) (T. Dinars) (IS S

Austria

Plant Protections Ilhj.000 217.1h3 llb,on( 21 7,1)1

Sub-Total Th,.000 217.J3 13h,000 217,113

(B. France) ( US $) (B. France) (USL) (B. France) ( TS $) (B. Francs) (LS $)

Lalgium 2/ Pilot farm for produce 1,600,000 32,000 1.600,t03 32,000

Sub-Total 1.600.000 32.000 1.60o.0or 32,000

(France) s $) (Fanc) (s $) (France) ( US $) (Frances) (tlS ) France

Technical Assistance, 1959-196L.

Equipment 2,67h,745

Studies 11,671,882

Personnel 776,621

BDPA- School materials 219,000 hh,356

Centre de Genie Rural de 1'ENSAT 207,000 hl,926 200,000 bo,5o8

Flood Protection Studies 130,000 26,330

Mission Francaise de Productivite 700,000 311,778 670,000 135,702

Tunis Drinking Water Study 120,000 24,305

Agr. Instructors BDPA 125,000 25,318

Prof. Adjoints of Agriculture 227,000 45,977

INRAT - Lab. Materials 128,2145 25,97

Agr. College - Materials 62,000 12,557

Oued Nebhana -300000 60,76?

6 Sub-Total 1,728,000 3s,s99o 1,3 0,21,5 275,50d

(US$) (IN) (UsS ) (DM) US $) (Tim) (T's t)

Counterpart Funds

Fertilizers, seeds, livea4ook 1,500,000 375,000 2,300,000 .575,ooo 2,300,000 575,000

Other Technicel Assistance:

Ea Babibia Project (tree nursery) 700,000 175,000 BeJaoua Project (milk and livestock breeding) 1,000,000 250,000 60o,00 150,000 600,000 150,000 BordJ Toum-4a_uaria Project 3,000,000 750,000 1,500,000 375,000 300,000 75,000 INRAT - (Research) 500,000 125,000 700,000 175,000 700,000 175,000 Sedjenane (milk and livestock breeding) 1,700,000 1h25,000 Megrine (Plant Protection) 1,500,000 375,000 500,000 125,000 3 URD (Seek X1 Arba) 800,000 200,000 HER ( training of photographers) 1,300,000 325,000 Forestry Projects 1,000,000 250,000 Milk Collection Centers °00,000 ?25,000 Fellowships 3,600,000 900,000 1,300,000 325,000 1,oo00,000 350,ooo Volunteers _3 00.000 75.000 1.600.000 !,oo.ono Sub-Total 13,500,000 3,375,000 8,800,000 2,200,0'0 9,300,000 2,325,000

1/ Program continues during 1067 at same rate a, 1966. Te.hnical Training abroad is anticipated.

Excluding techni-al assistance to Aor. Education.

S ure: -; oT:n4r15-; : , lUNISIA: Bilateral Aid to Agriculture

Grants, Subsidies, Technical Assistance and Counterpart Funds

Program rutal Utilized by 12/31'6L Utilized in 1i6q Utilized in 1966

(T.Dinars) (Us 6) (T.Dinars) (Us $) (T.Dinars) (Us t6) (T.Dinars) (TS 6)

U.S.A.

Counterpart Funds (FL 480)

BNA (Agricultural Bank) 2,672,900 5,09o,34o 1,572,900 2,996,060 1,000,000 1,90h,OO

Oued Gabes 700,000 1,333,360 h60,000 876,208 2ho,000 657,152

CES (Soil Conservation) 2,268,hoo h,320,8b8 2,200,000 b,190,560 68,boo 130,288

Rural Housing 600,000 1,1142,880 600,000 1,112,S880

Agr. Equipment 250,000 L76,200 130,000 207,62L 70,000 133,336

50 Wells 121,500 231,h33 86,000 163,813 35,500 67,620

Nebhana 2,51h,500 4,789,670 1,000,000 1,90M,800 1l,500 27,620

Merguellil 455,000 866,68L

Chott Maria 392,000 7U6,682

Agr. Education 1,215,300 2,311T,903

Chott Maria Agr. School 13,800 26,286

El Haunaria 350,500 666,680

G Id El Ghoulo 200,000 350,960

Sub-Total 11,753,hOO 22,387,876 1h,91S,9G0 9,369,521 2,L38,h00 h,6hh,66h 120,000 228,576

Other Technical Assistance-

BNA 126,000

OVed YNarguellil 918,000

Consultants 37',000

50 Tubewells 2,065,000

Fruit and Vegetable Production 3h6,000

1edbrda Valley Development 129,000

Agr. College at Chott Maria 1,367,000

Cooperatives Q,00ooo

Agr. Market Studies __ 60,0o0

Sub-Total 5,939,000

1' Disbursements are shown as of 12/31!66. 3ource: -,overlrnmt ao T2risia lata cnlJ. Agricultural Technical Assistance Personnel in Tunisia ir.1966

Country of Agriculture Fisheries Total Organization Research Training Extension Irrigation Livestock Forestry (numbers of person) 13 Austria 12 1 1 26 Belgium 1 19 1 5 4 .2 6 Bulgaria 7 Canada 7 8 1 1 1 5 Czechoslovakia 6 Finland 6 118 France2/ 19 67 10 13 1 8 5 3 5 1 18 Germany 3 Italy 3/ 2 1 3 3 1 4 11 Netherlands 7 Sweden 7 1 2 Switzerland 1 48 United Nations 14 9 11 3 1 10 USA 2 9 1 3 4 3 1 8 USSR 26 Yugoslavia 1 11 13 1

1/ Includes 11 working on aerial spraying of crops. 2/ Excluding 5 from SCET working witn Extension Service. 3/ Excludes 14 from "Nuovo Castore"t working on "lacs collenaires" projects. Source: Government of Tunisia, UN, and USAID.

CD

\ oJ\ ANNEX 10 Page 1

FRVIEV OF AGRICULTURAL PROJECTS AND PROGRAM'S

TUNISIA

Terms of Reference

1. On or about August 21, 1967, you will proceed to Tunisia to carry out a review of the agricultural sector programs of the Govern- ment of Tunisia with specific emphasis on programs for investment, technical assistance requirements, and programs for supply of product- ion requisites. lIlessrs. Brochu (FAO) and Kirpich will also be members of the mission. Mr. Hendry will be responsible for coordination of the mission's work. En route to Tunisia Mr. Kordik will visit FAO, Rome, for briefing where he will be joined by Mr. Brochu (FAO). Mr. Hendry will join the mission in Tunisia and M4r. Kirpich will follow to join the mission for two to three weeks in September.

2. In particular, the mission will review and list:

(a) All on-going agricultural investment projects, their status of implementation, source of financing, and further steps to be taken for their execution, including technical assistance needs;

(b) Agricultural investment projects identified and/or under preparation, which appear feasible of execu- tion in the near future; further work required to bring such projects to the stage of appraisal; and the technical assistance required therefore;

(c) Possible technical assistance needs not directly linked to project activities outlined above; and

(d) Needs for production requisites such as fertilizer, seeds, pesticides and related credit requirements.

The mission will quantify investment and technical assistance requirements in terms of specific projects and programs and suggest priorities and timing. In doing so, it will take account of the general situation of the agricultural sector and, in particular, implementation capacities and market limitations. The mission will not engage in detailed identification and/or preparation of projects.

3. You will visit FAO, Rome, for consultation on termination of the mission's field visit to Tunisia. The mission is expected to return to the Bank on or about October 1. Upon return you will submit a brief back-to-office report to be followed by a full report.