Document of

The World Bank

FOR OFFICIAL USE ONLY

C R ASg C17

Report No. 5909-CA

STAFF APPRAISAL REPORT

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

March 24, 1986

Western Africa Projects DepartmentAgriculture D

This document has a restricted distribution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be disclosed without World Bank authorhalion.

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

CURRENCY

Currency Unit - CFA Franc (CFAF)USS1.00 = CFAF 385

WEIGHTS AND MEASURES

1 Square Kilometer (km ) = 0.39 Square Miles1 Hectare 2.47 Acres

ABBREVIATIONS AND ACRONYMS

ADF African Development Fund

ANEC Association Nationale des Eleveurs Centrafricains(National Association of Central African LivestockProducers)

CAR Central African Republic

CBPP Contagious Bovine Pleuro-Pneumonia

EDF European Development Fund

FAC Fonds d'Aide et de Cooprration(French Fund for Aid and Cooperation)

FNEC Federation Nationale des Eleveurs Centrafricains(National Federation of Central African LivestockProducers)

IFAD International Fund for Agricultural Develorment

LS Livestock Service

MDR MinistAre du Developpement Rural(Ministrv of Rural Develorment'

PMU Project Monitoring Urnit

WLP Western Livestock Project

FISCAL YEAR

rovernment : January 1 - December 31

FOR oMC[AL USE ONLY

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

STAFF APPRAISAL REPORT

TABLE OF CONTENTS

Page No.

DOCUMENTS CONTAINED IN THE PROJECT FILE ......... ........... iii

CREDIT AND PROJECT SUMHMARY ................................. v

I. BACKGROUND ................................ . 1

A. Introduction ...................................... 1B. The Economy ....................................... 1C. The Agricultural Sector ........................... 2

II. THE LIVESTOCK SUBSECTOR ......... ..................... 3

A. Livestock in the Economv .......................... 3B. Physical and Social Environment ..... .............. 4C. Technical Constraints and Offtake .... ............. 4D. Livestock Institutions ............................ 5

1. ANEC/FNEC .................................... 52. The Livestock Service ........................ 63. Livestock Development Projects .... ........... 7

TIII THE PROJECT.8III TH PRJEC ............................................

A. Project Objectives ................................ 81. Rationale for Bank Group Involvement .... ..... 92. Summary Description .......................... 9

B. Detailed Features .. 101. FEC ......... ............................... 102. Livestock Service ............................ 113. Infrastructure Development ..... .............. 134. Project Management and Monitoring .... ........ 13

C. Implementation ........ ............................ 141. Institutional and Other Reforms .... .......... 142. Organization and Management ..... ............. 153. Present Status of Project ..... ............... 17

This report is based on the findings of an appraisal mission undertaken inMay/June 1985 by a team consisting of Mr. de Haan, Mr. Baillie, andMs. Kawabata (Bank staff), and Messrs. Marty and Guillaud (Consultants).The report was edited by Mrs. Layton and typed by Mrs. Reza.

This document nis a restricted distribution end may be used by recipients only in the performaiceof their official duties. Its contents may not otherwise be discloed without World Bank authoriution.

- ii -

TABLE OF CONTENTS (Continued) Page No.

D. Project Costs and Financing Plan .................. 171. Project Costs .... ........ 172. Financing Plan .................... ........ 18

E. Procurement and Disbursement ...................... 191. Procurement ............... ..... 192. Disbursement ........................... 20

F. Production, Markets and Prices .................... 21G. Financial Results, Economic Benefits and

Project Risks ......... ........ * ....*..*. ........ . 221. Financial Results ..**.....**e.*.... ****.......... 222. Economic Benefits ...... ... ......... .......... 223. Project Risks ........ .. ............ ... .. .......... . 234. Environmental Risks ..... ...... .... 09 ...... . 23

IV. AGREEMENTS REACHED AND RECOMMENDATION ............... 24

ANNEXES

1 MDR Organization Chart

2-1 Livestock in the Economy2-2 Ph7sical and Social Environment2-3 Technical Constraints and Offtake2-4 Livestock Institutions2-5 The Western Livestock Project

3-1 Technical Packages3-2 FNEC Component3-3 Livestock Service Component3-4 Infrastructure Component3-5 Project Monitoring3-6 Institutional Reform and Action Plan3-7 Project Linkages with Livestock Service and FNEC3-8 FNEC Proposed Organization Chart3-9 Livestock Service Proposed Organization Chart3-10 Technical Assistance3-11 Implementation Schedule3-12 Project Cost Summary3-13 Financing Plan by Project Component3-14 Project and Special Accounts3-15 Estimated Schedule of Credit Disbursement3-16 Herd Projections3-17 Financial Results3-18 Economic Benefits

MAP IBRD No. 19233

- Iij -

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

DOCUMENTS CONTAINED IN THE PROJECT FILE

CodeSelected Reports and Otudies Relating to the Sector

1. Central African Republic Country Economic Memorandum, LEAP - B/RDecember 1983.

2. "Etude de Faisabilite du Projet de Sauvegarde des 225.978Bovins Trypanotolerants en Republique Centrafricaine",BDPA, 1984.

3. "Plan Quinquennal 1986-1990, Agriculture/Elevage", 225.978Direction des Etudes et de Coordination, MDR, 1985.

4. "Les Eleveurs M'Bororo de l'Ombella M'Poko", CAR-Cr.1150Claude Le Masson, 1985. No. 225.971

5. "Le Developpement de l'Elevage dans l'Ouest CAR-Cr. 894Centrafricain", Jean Boutrais, OSTROM, 1985. No. 225.982

Selected Reports on the Project

6. "Les Paturages de la Region de Bossembele, Yaloke; CAR-Cr. 894Diagnostic et Propositions de Gestion", J. Audru. No. 220.644IEMVT, 1983.

7. "Etude de Factibilite de la Phase VI. Projet de 225.983Developpement de V'Elevage Ouest. (RepubliqueCentrafricaine). Volet Laboratoire", M. Clair,IEMVT, 1985.

8. "Preparation du Second Projet du D6veloppement de 225.986l'Elevage", 4 Vol., BDPA, 1985.

9. "Justification Economique de la Mise en Place de CAR-Cr.894l'Exploitation d'un Bain Detiqueur en R6publique 225.987Centrafricaine", BDPA, 1985.

Reports on the Western Livestock Project

10. "Resultat des Enquetes Sanitaires et du Nouveau CAR-Cr. 894Systeme de Vente des Produits Veterinaires. No. 225.968Cellule Suivi et Evaluation du Projet", 1984.

11. "Raprort d'Etude sur le Prix Reel d'Achat des CAR-Cr. 894Produits Veterinaires par les Eleveurs" PDEO, 1985. No. 224.717

12. "Rapport semestriel, no. 9", PDEO, 1985. CAR-Cr. 894

- iv -

DOCUMENZTS IN THE PROJECT FILE (Continued) Code

13. "Annexe no. 3. Rapport Semestriel no. 9. Sous-Projet CAR-Cr. 894Agropastoral de Bossembele", PDEO, 1985. Q/R

14. "Preevaluation de la Deuxifme Phase du Projet d'Elevage. 225.989Les Aspects Institutionels", A. Marty, 1985.

Staff Working Papers

15. "Evaluation Projet de Developpement de l'Elevage: 225.990 (1)Composante Formation Vulgarisation", P. Guillaud, 1985.

16. Rural Feeder Roads, E. Baillie. 1985. 225.990 (2)

17. Cattle Dip Troughs, E. Baillie, 1985. 225.990 (3)

18. Detailed Cost Tables, K. Kawabata, 1985. 225.990 (4)

19. Herd Projection Tables, K. Kawabata and 225.990 (5)C. de Haan, 1985.

20. Terms of Reference Technical Assistance 225.990 (6)Personnel

21. Economic Analysis 225.990 (7

WAPADMarch 1986

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

CREDIT AND PROJECT SUMMARY

Borrower: Central African Republic

Beneficiaries: The National Federation of Central African LivestockProducers and the Livestock Service of the Ministrv of RuralDevelopment. The Borrower would make availableUS$1.8 million equivalent of the Credit, as a grant to theFederation.

Credit Amount: SDR 10.3 million (US$11.9 million equivalent)

Terms: Standard IDA terms

Cofinanciers: The European Development Fund (EDF) of the EuropeanEconomic Community, the French Fund for Aid and Cooperation(FAC) and the International Fund for AgriculturalDevelopment (IFAD).

ProjectDescription: The project's main objective would be to develop a viable

institutional framework for the country's livestocksubsector to ensure the efficient delivery of necessaryinputs and extension to livestock producers, thus reducingdiseases and pasture degradation, increasing livestockproduction, and improving the standard of living of herders.It would (a) strengthen the National Federation of CentralAfrican Livestock Producers (FNEC) to further develop itsinput deliverv and pastoral organization and to increase thenumber of herder associations; (b) assist the LivestockService (LS) in its vaccination campaigns against the mainepidemic diseases; the reorganization and strengthening ofits extension, research and pastoral settlement activities;and the restructuring of its personnel and financialorganization to sustain these activities on a long-termbasis; (c) rehabilitate feeder roads in the LivestockCommunities to improve the herders' access to markets; and(d) reinforce management capabilities during projectimplementation.

-vi-

Estimated Costs (US$ million)

FNEC Local Foreign Total

Admin. and Finance 0.5 0:7 1.2Input Distribution 1.5 4.7 6.2Pastoral Organization

and Training 0.8 0.8 1.6LS

Extension and Vaccination 5.7 2.8 8.5Research 1.2 1.0 2.2Pastoral Settlement 1.3 1.2 2.5Livestock Dev. Fund 0.3 0.9 1.2

Infrastructure

Feeder Road Rehabilitation 1.4 1.3 2.7

Project Management

Directorate 0.7 1.0 1.7Monitoring and Evaluation 0.2 0.2 0.4Workshop 0.3 0.4 0.7Preparation Follow-up

Project 0.2 0.3 0.5

Total Baseline Costs 14.1 15.3 29.4

Price Contingencies 0.6 1.3 1.9Physical Contingencies 3.0 3.0 6.0

Total Project Cost 17.7 19.6 37.3

Financing Plan (USS million)

Local Foreign Total

IDA 5.0 6.9 11.9IFAD 1.6 2.2 3.8EDF 2.8 2.6 5.4FAC 0.3 0.8 1.1FNEC and herders 1.4 5.7 7.1Government 6.6 1.4 8.0

Total 17.7 19.6 37.3

- vii -

Estimated IDA Disbursements (US$ million)

IDA FY 1987 1988 1989 1990 1991 1992 1993

Annual 1.1 1.8 2.3 2.5 2.0 1.5 0.7Cumulative 1.1 2.9 5.2 7.7 9.7 11.2 11.9

Benefits and Risks

The project would create the basis for a viable and sustainableinstitutional framework to better serve the livestock subsector; improvzeknowledge and use of veterinary Inputs by herders; increase annual meatproduction by 2,600 tons In PY5 and 15,000 tons in PY20, and the income ofabout 10,800 families (45Z of thz cattle-raising population); and increasemilk production by 6,000 tons In PY5 and 25,000 tons in PY20, thus raisinglocal consumption and improving nutrition. Risks concern the efficiency ofthe Livestock Service, the stability and competence of FNEC's leadership,the feasiblity of organizing pastoral associations, and the use ofveterinary drugs by herders. The technical assistance component, theproposed institutional reforms, and the proiect's approach to work withinexisting government and traditional structures are expected to ensureorderly project implementation.

Economic Rate of Return: 152 if all project costs are included,Increasing to 20% if the research and pilotoperations and infrastructural component areexcluded from the analysis.

18p: IBRD 19233

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

STAFF APPRAISAL REPORT

I. BACKGROUND

A. Introduction

1. The Government of the Central African Republic (CAR) hasrequested IDA's assistance to finance a national livestock project insupport of its policy to increase livestock production, enhance the role ofthe private sector, and integrate the nomadic population into the ruralsociety. The project as proposed would build upon and consolidate theactivities started under the IDA/ADF/IFAD-financed Western LivestockProject and the EDF-financed Central Livestock Project. EDF, FAC and IFADhave confirmed their participation in cofinancing this project.

2. The project was identified by Government and the Bank in May 1984as a follow-up to the Western and Central Livestock Projects. It wasprepared by the French Office for the Development of AgriculturalProduction ("Bureau pour le Developpement de la Production Agricole"- BDPA) under French bilateral financing. The final preparation report wassubmitted to IDA in March 1985 and the project was appraised in Mav/June1985 with the participation of EDF and FAC representatives. Negotiationswere held in Washington from March 3 to March 7, 1986.

B. The Economy

3. The CAR is a landlocked country of 623,000 km in the heart ofAfrica. Its climate is subhumid, varying from Sub-Sahelian with an averageannual rainfall of 700 mm in the extreme north, to inter-tropical with1,100 mm in the central region, and to equatorial with 1,500 mm in thesouthwest. Its topography consists of a vast plateau with gently rollinghills, cut by many streams and rivers. Its vegetation ranges from woodlandsavannah in the central and northern parts of the countrv to equatorialforest in the south.

4. The CAR's population is estimated at 2.6 million (1984), with alow density of about four inhabitants per square kilometer. In recentyears population growth has averaged 2.5%, with urban growth rates of 4-5%.About 70% of the population is rural and 12% is livestock producer, almostexclusively from the Fulani ethnic group.

5. With a per capita income of USS270 in 1984, the CAR belongs tothe group of least developed countries. Agriculture, including forestry,is the mainstav of the economv and accounts for about 42% of GDP, mining,manufacturing and construction for 13%, and services for 45%. Hightransportation costs in domestic and international trade and an oversizedcivil service explain the large share of services in GDP.

- 2 -

6. The CAR's landlocked position, dlfficult transportationconditions, sparsely populated area, limited domestic market, and weakhuman resource base are the principal constraints to the development of itseconomy. Bottlenecks in the routes to the sea through the Congo(river/rail) and through Cameroon (road/rail) substantially raiseproduction and inventory costs and reduce the CAR's export competitiveness.The CAR has, however, a good economic resource base which should allow itsper capita income to grow at a modest but sustainable rate, providedappropriate macroeconomic and sectoral policies are put in place.

7. Following a severe period of mismanagement of the economy in the1970s, significant progress has been made toward establishing the rightpolicy framework. Since then, policy changes have been introduced,emphasizing appropriate producer incentives, stabilization of publicfinances, stepwise reduction of state intervention in economic activitiesand encouragement of the private sector. Between 1980 and 1985, cottonproducer prices were doubled in nominal terms, fertilizer subsidiesreduced, and performance of the main rural development agency ("Socift6Centrafricaine de D6veloppement Agricole" - SOCADA) was significantlyimproved by reducing its overhead costs. Consequently, cotton productionand yields more than doubled from 22,600 tons in 1981 to 46,300 tons in1985, and from 176 kg/ha to 572 kg/ha, respectively. Food crop productionhas also risen in line with cotton production, and in response to theGovernment's decision to refrain from intervening in foodcrop marketing andthe reappearance of consumer goods in rural areas. Between 1982 and 1985,gross domestic product and agricultural production rose, interrupted by thedrought in 1983, at an annual average rate of 1.2% and 2.6% respectively.

8. Impressive progress has also been achieved in the area of publicfinance. Over the past two vears, budgetary deficits have been drasticallyreduced, due both to Increased revenues and improved expenditure control,including a slight reduction in the number of civil servants. However, thepublic sector continues to be burdened with excessively high personnelcosts thus limiting severely government revenues available for operationalor development purposes. Government is addressing this problem in thecontext of both individual projects, such as the proposed NationalLivestock Project, and an ongoing reform of the public administration.

C. The Agricultural Sector

9. Agriculture accounts for 42% of the CAR's GDP, 80% of exportearnings and 80% of employment. Foodcrop and livestock production eachcontribute more than one-third to agricultural GDP, with export crops andforestrv making up the remainder. About 350,000 families growfoodcrops--mostly cassava--on approximately 520,000 ha, or 80% of the totalcropped area. The country is virtually self-sufficient in the main foodstaples. Coffee and cotton are the main export crops. Coffee, mostly grownin the southwest, provides 16% of CAR's foreign exchange revenues, secondonly to diamonds. Cotton, grown mainly in the northwestern and central

- 3 -

provinces, provides 14% of exports. It is the most widely grown cash cropand is, therefore, a kev catalyst in rural development. However, therecent fall of cotton prices on the world market endangers the viability ofthis crop.

10. After the sharp decline of the sector in the 1970s, the currentGoverrment established the following priorities for its agriculturalstrategy: (a) development of the smallholkder sector; (b) rehabilitation ofthe regional-based rural development institutions; and (c) rehabilitationof export and foodcrop production and rural infrastructure in an integratedrural development approach. It has since made considerable progress inliberalizing prices and markets of foodcrops and revitalizing cotton andits rural development agency, SOCADA. The rural development strategy forthe new five-year plan (1986-1990) continues to be based on theseprinciples, with heavy emphasis on the reform of Government institutions toimprove their relationship with the producers. The current dialogue withthe Bank focuses on this institutional reform issue and on pricing andmarketing issues in coffee and cotton. The Ministry of Rural Development("Ministare du Developpement Rural" - MDR), through its three DirectoratesGeneral (Agriculture, Rural Works and Livestock) is responsible forimplementing this strategy. MDR's organization chart is in Annex 1.

II. THE LIVESTOCK SUBSECTOR

A. Livestock in the Economy

11. Livestock production has recently become a major activity in theCAR. This has been due to a dramatic increase in cattle migration fromCameroon, Nigeria and Chad over the last two decades, but particularly inthe early 1980s, when drought and civil unrest in Chad and the efficientvaccination campaign against Rinderpest in the CAR (para 23) brought inseveral thousands of herders from neighboring countries. As a result,CAR's cattle herd doubled from 1.1 million head in 1980 to 2.2 million in1984. Smallstock flocks (900,000 goats, 100,000 sheep, 300,000 pigs and 2million poultry) have been growing more slowly. More background on therole of livestock in the CAR's economy is in Annex 2-1.

12. Livestock is one of the agricultural subsectors with the greatestgrowth potential in the CAR. The country is self-sufficient in meat, butthere are export opportunities within the region (to Nigeria, Gabon,Congo). Besides making an important contribution to increased exports,livestock could contribute substantially to increasing the overallefficiency of crop production: there is still considerable scope forexpanding the use of animal traction and other forms of integrating cropsand livestock. The project would encourage this integration. Moreover,especially in remote areas, herders are almost the only outlet forfoodcrops produced by peasant farmers. Government is aware of livestock'spotential and gives its realization a high priority. Over the last few

- 4 -

years, 14% of the rural development investment budget and 30% of itsoperational budget have been allocated to livestock, and Government intendsto maintain this level.

B. Physical and Social Environment

13. Almost all cattle in the CAR are kept by the nomadic M'bororo(20,000 families) and the settled Foulbe (2,000 families), who togethermake up the Fulani ethnic group. The Fulanis form a highly structuredsociety, clearly distinct from the rest of the population by their pastoralvocation, migratory life-style, language and religion. Most cattleproduction is nomadic or semi-nomadic grazing on the common rangelands.However, settlement, combining herding with cropping, is becomingincreasingly common, especially in the so-called Livestock Communities.These are special areas demarcated by Government exclusively for grazingand contain 30% of the national cattle herd. The small herd (7,500 head)of trypanotolerant cattle introduced in CAR from Guinea in the 1950s ismainly kept by crop growers. Legislation restricting the sale andslaughter of these cattle was intended to accelerate the multiplication ofthis valuable breed, but has had, in fact, the opposite effect of severelyconstraining its expansion. This legislation would be rescinded as acondition of Credit effectiveness (para 70(a)). Smallstock are also keptby crop farmers, and ownership of small ruminants is widespread.

14. A detailed socio-anthropological study of the Fulanis (ProjectFile No. 225.982) and a survey of their household budgets (Project FileNo. 225.971) were carried out as part of project preparation. They showedthat cattle wealth is not evenly distributed among the Fulanis. Herdownership ranges from 40 to 1,000 head per family (average nine persons).The average annual per capita income of these pastoralists is about US$330equivalent (national average: USS270), but this figure is somewhatmisleading as about 55% owns fewer than 100 head and thelr average incomeis less than US$170 equivalent. Differences in wealth clearly affectindividual herd management strategy; poorer herders care more for theiranimals, as shown by their higher expendc!itures per animal on veterinarydrugs. Furthermore, poorer herders are forced to sell a higher percentageof their animals to menet subsistence needs, sometimes jeopardizing thesustainability of their herds. It can be expected, therefore, that poorerherders will benefit at least equally from improvements in the animalhea'lth delivery system. More country data, including the geograrhicaldistribution and characteristics of the animal population, and structures,income and nutrition of herders are given in Annex 2-2.

C. Technical Constraints and Offtake

15. Herd disease and poor nutrition are the main technicalconstraints producers face. The main diseases are Trypanosomiasis,Brucellosis, internal parasites, and ticks and tick-borne diseases; theiraffect on animal health is described in Annex 2-3, which also gives a brief

- 5 -

account of the country's animal feed resources. Cattle fertilitv is lowbecause of Trypanosomiasis and a high incidentce of Brucellosis. The poorquality of rangelands in the dry season aggravates the effects of thesediseases. Veterinary drugs to control them have only recently becomeavailable, but their distribution and use are still deficient. As aresult, average mortality of all age groups over the last few years is 10I(30% of calves) compared with 8% (20-30% of calves) for Sub-Saharan Africa.The estimated calving rate is 53% against a feasible 65%. Cattle herdersknow that diseases are their major constraint and respond eagerly toopportunities of procuring animal health inputs, as demonstrated by thespectacular sales growth under the Western Livestock Project (WLP)(para 25)and the success of the Rinderpest campaign (para 23).

16. With an increasingly successful control of animal diseases, thesecond generation problems of preventing rangeland degradation become moreimportant. Although the CAR's potential carrying capacity is about doublethe present livestock population, the subhumid savannah vegetation isextremely fragile and localized range degradation is apparent.Socio-economically feasible control methods would include the introductionof better grazing management and adjudication of exclusive grazing rightsto settled herder associations, to be tested under the project.

17. Cattle marketing is mostly handled by traders from Cameroon andChad, who buy directly from herders or at cattle markets. Although severalmiddlemen are normally involved until cattle reach the consumer markets ofBangui, or of Cameroon and Nigeria, markups are reasonable and the systemis efficient. Offtake is affected by the shortage of consumer goods inproduction areas due to poor access to secondary roads, which reduces theincentive to sell cattle. There are no sociological constraints toincreasing offtake, and contrary to widespread opinion, cattle are soldwhen they have reached their maximum weight and are not kept beyond thatstage for prestige reasons. In the cropping area, milk is often sold bywomen to crop farmers; no markets for milk exist in the low densitvpopulation areas.

D. Livestock Institutions

1. ANEC/FNEC

18. In 1973, faced with an almost complete collapse of the GovernmentLivestock Service (LS), the producers formed a private and autonomousNational Association of Central African Livestock Producers (ANEC) tofacilitate drug distribution. However, poor leadership in the late 1970sseverelv affected its operat4ons. Tn 1981, the newly appointed SecretaryGeneral rehabilitated ANEC 7ith the help of technical assistance under WLP.This institution--unique in West Africa-represents the herders at thenational level and distributes the necessary inputs, mainly veterinarydrugs. Its image at the field level has improved over the last few years;60% of all herders are now fee-paying members. It is governed by a GeneralAssembly and a Board of Directors, chaired by an elected President, and has

- 6 -

a Secretary General as its chief executive. A Coordination Committee,comprising the President and Secretary General of ANEC and the DirectorGeneral of the LS, plans and supervises its day-to-day operations andcoordinates them with the LS.

19. The main problems of ANEC are: (a) lack of adequate organizationat field level, although a start has been made in developing local herderassociations; (b) strong Government pressures to finance other activities,thus threatening ANEC's financial viability; and (c) lack of herders witheducational levels allowing effective participation in management. Toaddress these issues, amended statutes were adopted during projectpreparation, under which the representation of herder associations in theGeneral Assembly is greatly increased, thus broadening grassrootparticipantion in management (para 34). The amended statutes furtherstrengthen the role of the Board of Directors and of the CoordinationCommittee to enhance its independence from Government. These actions arereflected in the recent change of name of the National Association (ANEC)into the National Federation (FNEC). Under the project, trainingopportunities would be created to expand the basis from which FNEC couldselect future leaders.

20. FNEC derives its income mainly from membership fees and profitson drug sales (US$329,COO in 1984). Under its amended statutes, 30% of themembership fees will remain in the local herder associations to strengthentheir activities. FNEC also receives Mar-ket and Trypanocide fees (locallyknown as "taxes") (US$59,000 in 1984). These taxes were instituted in the1970s and levied respectively by the FNEC representatives and LS staff ontraders at cattle markets to maintain market facilities and provide tradecattle enroute to Bangui with protection against Trypanosomiasis. However,they are no longer associated with their original purpose, as changingcircumstances (more export to Trypanosomiasis-free areas and improved drugavailability) have obviated the use of this prophylaxis or FNEC'sinvolvement in its administration. The recovery rate has plummeted to10-20%. Under the project, this system would be rehabilitated and therevenues used as the beneficiaries' contribution to the LivestockDevelopment Fund to finance the reorganization of the LS and to recover aportion of the costs of rangeland and animal production extension(para 40).

2. The Livestock Service

21. The Directorate General of Livestock and Animal Industries in ]MDRis responsible for the overall development of the livestock subsector. Itis represented in all the districts to provide producers with animal healthand production advice and services; it operates a training college forfield staff at Bouar and a clinic in Bangui, and is responsible forsanitary control at the borders, markets and slaughter places. The presentpayroll shows a total of 752 staff. This total number of staff is high inrelation to the number of cattle and to what the country can afford eventhough it compares favorably with levels in many other countries in theRegion; however, the proportion of lower level support staff is

U

comparatively high. The main problem is that virtually all (99.5%) of theUS$1.4 million equivalent Government budget for the LS is spent onsalaries. This makes LS totally dependent on external financing foroperational expenditures. Furthermore, the structure of the LS is complex,with six levels from the Directorate General to the Livestock Post.Because of the high proportion of junior staff, many field levelsupervisors are quite inexperienced, making effective information transferfrom management to the grassroot level very difficult. More information onthe above two livestock institutes is provided in Annex 2-4, together withFNEC's fee structure.

3. Livestock Development Projects

22. The two Livestock Development Projects--the Western LivestockProject (WLP) financed by IDA/IFAD/ADF and the Central Livestock Project(CLP) under EDF financing--provide the main impetus to livestockdevelopment in the CAR. WLP is described in more detail in Annex 2-5.They have similar objectives, i.e., to increase livestock production andthe standard of living of the herders through improved animal healtitservices and production extension. Additionally, CLP supports thedevelopment of a livestock multiplication center for trypanotolerant cattleand has constructed some markets, and WLP supports the Livestock TrainingCollege at Bouar. Together they finance virtually all operating costs ofthe LS. Geographicallv, CLP focuses on the central part of the countrywith 25% of the cattle population and WLP on the western part, whichcontains the remaining 75Z. Government has decided to merge all futureexternal funding into the National Livestock Project.

23. Initially both projects worked exclusivelv with the LS, but whilepositive results were obtained with this approach in some areas,performance in others was poor. With heavy assistance from the twoprojects, LS responded efficiently to the region-wide Rinderpest outbreakin 1983, containing mortality to less than 1% in the CAR against 5-15% inneighboring countries. Three successful follow-up campaigns wereorganized. Each project supports a provincial field diagnostic laboratory;although these laboratories are severely hampered by unreliable utilities,they perform simple diagnostic work well. Some progress has also been madein grazing management. Simple grazing schemes that halt pasturedegradation have been identified and are being introduced on a pilot scale.Furthermore, capable Central African nationals have been appointed to thepositions of Director General and Regional Inspector. Government paymentof LS salaries has been generally on time and disbursement under WLP isonly one year behind schedule. The initial weaknesses of the WLP technicalassistance have been overcome and the present team is well integrated intothe overall government structure.

24. Initial project performance in curative animal health and animalproduction extension had been poor because of weaknesses in the projectdesign and in the structure of LS. The WLP revolving fund for the sale ofdrugs was mismanaged, and contacts between LS and producers beyondvaccination campaigns had been minimal. The Technical College at Bouar

- 8 -

produced graduates who were automatically recruited for an alreadyoverstaffed civil service, while the technical quality of existing staffwas extremely poor.

25. The animal health and training components of WLP were thereforeredesigned in October 1982 and ANEC was given responsibilitv for thedistribution of veterinary drugs. Training was reoriented toward herdersto teach them the proper use of these drugs. CLP adopted the same approachin 1984. The automatic recruitment of graduates of the Bouar College forcivil service was discontinued and training was shortened from four tothree years. Under the project, training would focus exclusively onrefresher courses for existing staff, and admission of new students wouldbe suspended for five years. As a result of the new project design, drugsales have jumped thirtv-fold, about 1,000 herders have been trained and 20herder associations have been formed and function well. The distributionsystem now reaches most producers, including the poorer strata.

26. The two projects did not address the structural weaknesses of theLS, which is still hampered by inadequate training and communicationdifficulties of the field staff, due to different ethnic and languagebackgrounds, and bv the absence of an adequate extension methodology.Furthermore, the lack of resources and inadequate personnel policies do notprovide adequate incentives for the agent to go to the field. Extension ingrazing management, animal production, the integration of livestock intocrop production and overall sanitary protection, essential for awell-balanced development of the subsector, is therefore neglected.Furthermore, the structural dependence of LS on external funding for itsoperation has not been corrected. A more comprehensive approach, combiningmanagement reforms with retraining, introduction of well defined extensionpackages and methods, and a mechanism to redress the present imbalancebetween salary and non-salary expenditures is therefore necessary and is anintegral part of the National Livestock Project.

III. THE PROJECT

A. Project Objectives

27. The project's main objective would be to develop a viable andsustainable institutional framework for the livestock subsector that couldeffectively deliver animal health and production inputs, as well astechnical advice to all livestock producers to increase their productionand improve their standard of living. To achieve this objective, theproject would strengthen FNEC and LS in those areas where they havecomparative advantages and institute reforms to ensure the sustainabilityof the investments. The project would support Covernment's objectives toincrease food production, expand exports, strengthen and revitalizegovernment and private institutions in the subsector, and minimize therecurrent charges to be borne by Government after project completion.

- 9 -

1. Rationale for Bank Group Involvement

28. The project would support one of the CAR's agriculturalsubsectors with best growth potential. Further external support isessential to consolidate the initial gains made in animal health under WLP,to broaden these gains with key actions in rangeland use and animalproduction so as to arrive at sustainable land use systems and preventecological degradation. Further external support is also essential tointroduce the institutional reform actions required to ensure a long termsustainability of past investments and of any future investments in thelivestock subsector. The project's objectives, combining institutionalreforms and a larger role for the private sector, are in line with theinstitutional reform effort generally being supported by IDA. Furthermore,Government wishes IDA to continue to play a lead role in developing thesector, particularly in light of the experience gained under the WLP andthe need to monitor progress under the project. Finally, externalfinancing requirements of the project exceed the amounts available fromother concessional sources.

2. Summary Description

29. The projec' would support the following actions:

(a) In FNEC the project would (i) strengthen its financial andadministrative management; (ii) expand its input distributionsystem; and (iii) staff and equip a pastoral organization andtraining department to form about 200 herder associations andtrain their present and future leaders, auxiliaries and herdersin general.

(b) In LS the project would (i) restructure the personnel andfinancial organization,-so that LS can sustain its activities ona long-term basis; (ii) strengthen LS vaccination and extensioncapability; (iii) establish a central veterinary diagnostic andlivestock research laboratory; (iv) strengthen the department forpastoral settlement and further develop the pilot settlementareas; and (v) establish a Livestock Development Fund.

(c) Under the infrastructure component, the project wouldrehabilitate 600 km of feeder roads in areas of high livestockdensity.

(d) To reinforce management capabilities, the project would continueto staff and equip a small project management unit and amonitoring unit, and establish a vehicle and equipmentmaintenance unit.

30. The project would cover almost the entire subsector and focus onimproving the health of the national cattle herd. In addition, the projectwould start a number of activities with other livestock species and inrangeland use, animal production and management, producers organization and

- 10 -

institution building, which would make it a comprehensive livestockdevelopment effort. Geographically, the project would cover the entirelivestock population, combining activities on a national scale (drugdistribution, improved extension advice and vaccination, establishment ofherder associations) with the testing of promising technologies on a pilotscale (tsetse and tick control, dry season supplementation, grazingmanagement, small ruminant production, animal traction, and milkprocessing). Annex 3-1 gives a brief description of these technologies.

31. Prospects that the project would achieve its objectives and havea satisfactory economic impact are good. First, the project would buildupon earlier successful experiences and address a key constraint, i.e.,animal health, on which the producers place the highest prioritv--in ahumid environment and for which appropriate technology exists. Ex-postevaluations of the limited number of animal health interventions in WestAfrica have generally shown a high economic returns. Second, the projectconcept and design are significantly different from the majority of Africanlivestock projects, which in general performed poorly as they attempted toincrease animal production and rangeland productivity in low potential,arid environments, for which often no adequate soci.o-economically proventechnologies exist. Furthermore, the project would exploit the comparativeadvantages of the public and private sectors, and would use existinggovernment and traditional institutions--without making drasticchanges-thereby increasing the prospects of successful implementation.

B. Detailed Features

1. PNEC

32. General. The project would use FNEC's comparative advantage incommercial activities and its better communication channels with herders toexpand FNEC's livestock input distribution system and develop a herderorganization and training capability. This would address the maintechnical constraint, poor animal health, on the curative side, and furtherstrengthen producers organization at the field level. FNEC's financial andadministrative management would also be strengthened with the internationalrecruitment of a financial controller (five man-years) and computerequipment to improve FNEC's accounting and stock control system.

33. Livestock Input Distributioui System. FNEC's present system wouldbe expanded with one central and 29 Legional depots and provided withequipment and six sales vehicles. All staff and operating expenses wouldbe financed from the margin on the sale of drugs, except for the head ofthe system who would be peid by the project for the first three years andfrom the sales margin afterwards.

34. Herders Organization and Training. The project would support theformation of herder associations to facilitate the distribution of drugsand other inputs and training of herders, and to strengthen FNEC's fieldlevel organization to improve its representation at the national level.

- 11 -

Furthermore, the associations would be the essential building blocks forthe pilot settlement groups (para 39) through which the introduction ofmore rational rangeland use would be tested. The project would thereforesupport the establishment at FNEC of a pastoral organization and trainingdepartment and would finance a pastoral organization specialist for fouryears, as well as vehicles and operating costs for this department. Fieldwork would be entrusted to four mobile teams, each headed by an expatriatevolunteer. A network of about 30 pastoral agents would be gradually builtup to monitor and further guide the new herder associations. Based onWLP's success in forming such associations, the project would organize halfthe pastoral population (about 11,000 herders) into 216 associatiors; itwoulrd train in each association the leader and two auxiliaries for thepharmacies and introduce in total about 5,400 herders to the proper use ofdrugs. Furthermore, the project would provide professional and technicaltraining for up to ten young herders, so as to expand the basis forselection of FNEC's future leadership. A joint implementation review wouldbe carried out in the second half of 1989, when 80 herder associationswould have been established. This review would assess the achievements ofherders organization and training, and of the pastoral settlementcomponent, and would, if necessary, modify objectives and approaches in thelight of project experience. Further details on the FNEC component aregiven in Annex 3-2, in particular on the expected build-up of the herderassociations and of the livestock producers reached during projectimplementation.

2. Livestock Service

35. General. The project would assist LS in addressing thepreventive animal health needs, and the rangeland and animal productionconstraints: sanitary protection of the national herd (vaccination andquarantine measures), extension in rangeland use and animal productiontechniques; research; and pilot activities in pastoral settlement. Thesetasks have a strong public interest element or an experimental characterwhich makes LS the most suitable organization to implement them.Entrusting such tasks to a private institution such as FNEC would eitherproduce a conflict of interest (vaccination and quarantine rcquiring publicenforcement to be successful and settlement activities involvingfarmer/livestock land tenure), would involve risks normally entrusted onlyto a public institution (research) or would involve long-term investmentsand a high degree of public interest and be beyond FNEC's presentmanagement capabilities (rangeland use and animal production extension,which are important aspects of resource conservation). In the long run(5-10 years), a further transfer of animal production and managementextension responsibilities to FNEC may be feasible. The remaining LS tasksin sanitary border control and food inspection are outside the scope ofthis project.

36. Extension and Vaccination. To develop appropriate extensionmethods and packages for the herders, based on experience acquired underWLP, the project would finance the services of a livestock extension expert(three man-years) and associated transport and operational costs. This

- 12 -

expert would be assisted by locally recruited subject-matter specialists inthe preparation of livestock extension packages for crop farmers. TheBambari livestock multiplication center would be further equipped withcattle truck and provided with a revolving fund for the purchase and saleof trypanotolerant cattle to and from crop/livestock farmers. A diagnosticsurvev of smallstock problems would determine the main thrust of anappropriate extension package. The project would renew equipment forvaccination against Rinderpest, Contagious Bovine Pleuro Pneumonia (CBPP)and Brucellosis and would equip the sectors with motorcvcles and mopeds.

37. Staff Retraining. To improve their communication skills andtechnical expertise in preventive animal health, rangeland management, andanimal production techniques, all LS field staff would attend annualrefresher coturses at the Bouar College. An internationally recruitedtraining exrert (three man-years) would be financed to develop andintroduce this program, and funding would he made available for thelogistics of the programs and the demonstration farm (to he headed by aFrench volunlteer). Provision would also be made for about 61 staff-yearsof specific training outside the countrv, mostlv to remedv the lack ofhigher level technicians.

38. Research. An early warning svstem for the management of FNEC andLS concerning imn,inent disease outbreaks and resistance to certain drugs isan essential element of the liberalized use of veterinarv drugs as proposedunder the project. Fuirthermore, there is a need to develop aproblem-oriented research capability to test available technology on themain constraints identified under WLP. Tlhe project would thereforeconstruct and equip in Bangui, where reliable utilities exist, a centralveterinary diagnostic and livestock research laboratory to work in networkwith the existing provincial laboratories in Bambari and Bouar. Thepro-leLt would also provide transport, operating costs and two staff-yearsof cechnical assistance (TA) plus short-term consultants.

39. Pastoral Settlement. The project would support pilot settlementactivities to introduce a more rational use of rangelands, preventdegradation and move toward the development of permanent sustainable landuse svstems (para 16). Settlement would also foster a better integrationof the herders in the national economy. The project would thereforestrengthen the Settlement Unit established under WLP to further guide ardpromote sedentarization in up to 18 pilot "settlement zones". This Unitwould be provided with four man-vears of TA, local technical staff,transportation and operating costs at the national and regional levels.A typical settlement zone would cover 70,000 ha and grazing rights would beexclusively adjudicated to one or more herder associations which would havedemonstrated good social cohesion and sound financial management for atleast two years. Thus, of the projected 216 herders associations to beformed (para 34) 20-30 associations would be involved in this pilotsettlement component. A cattle dip to control ticks would be constructedin each zone to induce herders to settle. The herders would contribute 10%to the dip construction costs ene pav all costs of operation andmaintenance; the balance of the construction costs would be financed by the

- 13 -

project. This is justifiable given the experimental nature of thesettlement component and the wider social benefits of a rational land use.Further activities would include a functional literacy program anddemonstrations in forage cultivation for dry season supplementation and theuse of animal traction equipment. The implementation review (para 34),w't ich would be carried out in the second half of PY3 after six settlementrones with their infrastructure had been established, would determine thedefinite number of dips to be constructed under the project.

40. Livestock Development Fund. A Fund would be established tofinance, during the project execution period, pilot tests of potentiallvvaluable technologies and LS staff reduction under the institutional reformcomponent and, after project completion, the non-salary recurrent costs ofLS. Revenues for this Fund would be ULSSO.4 million external contributionand US$1.5 million in Market and Trypanocide taxes over the five yearproject implementation period. An amount of USSI.J million from thisnational contribution would be used to finance pilot technologies and theremaining US$0.4 million would be allocated to staff redundancv pavments.After project completion, annual revenues of uSSn.6 million are projected.Annex 3-3 describes these five LS components in more detail.

3. Infrastructure Development

41. About 600 km of feeder roads connecting the high-densitylivestock areas and livestock raising communities to regular markets wouldbe rehabilitated. These roads are essential for the regular supply of foodand consumer goods to traditional producers, to generate the cash they needfor such goods and thus create incentives to sell animals (Annex 3-4).Assurances have been obtained that (Government would make adequate fundingavailable to finance the maintenance of these rehabilitated roads(para 69(a)).

4. Project Management and Monitoring

42. The proiect management unit (PIlT), to be located in FNEC, wouldbe a very light structure (two professionals) designed to support existingorganizational structures in project implementation, and wnuld hedismantled at proJect completion. Tt would be headed b- an internationallyrecruited co-director for four vears (para 48). It would be provided withtransport and expanded office accommodations, as well as with a smallworkshop in Bangui and two mobile repair shops for the maintenance of allvehicles and equipment in the provinces. This vehicle and equipment unitwould be headed bv a French volunteer. The PMTi set up under IL-P would bestrengthened through regular consultant visits. The PMI4 would focus onspecific aspects and kev areas of implementation e'fectiveness withoutcreating a costly comprehensive data collection svstem, and would beincorporated into the LS Directorate General at project completion. Annex3-5 provides detailed information on these topics and the methods thatwould be used. Funds would also be rrovided to prerare a follow-upproject.

- 14 -

C. Implementation

43. To undertake key preparatory actions and ensure a smooth andefficient transition of TA personnel and activities from the ongoing WLP tothe proiect, IDA has approved a Government request for US$500,000 fundingunder the Project Preparation Facility (PPF). These funds are being usedto prepare bidding documents for office and laboratory construction inBangui, start the training of key Central African personnel, launch onemobile team for pastoral organization and training, and ensure continuityof several of the present TA staff into the National Livestock Project.

1. Institutional and Other Reforms

44. An Action Plan adopted during negotiations would be implementedover a five-year period (para 69(b)). LS would (a) correct the presentimbalance between salary and non-salary expenditures; (b) modify theexisting bonus system to better reflect individual performance and increasestaff incentives; and (c) reduce the number of hierarchical steps withinits organization as well as the total number of its staff. Annual targetsregarding the level of tax revenues, staff reductions and the pace ofreorganization, together with the broad parameters of the revised bonussystem were agreed. Details are given in Annex 3-6. In order to monitorprogress in achieving the goals of the Action Plan, disbursements for LSoperating costs would be subiect to review when thev reach the US$700,000US$1,400,000 and USS1,800,000 levels. Disbursements for LS operating costswould be resumed only if the Action Plan targets for the preceding tranchehad been met (paras 59 and 71).

45. Financial Aspects. The direct revenue system for LS would bebased on the existing system of Market and Trypanocide taxes andvaccination fees starting at US$0.1 million equivalent in PYI and reachingan annual level of US$0.6 million equivalent in PY5. Increased staffresources and better controls would increase the recovery rate from thesetaxes from the present level of 15% of potential to 50% by PY5. Theserevenues would be deposited in the Livestock Development Fund and usedduring project execution for staff redundancy payments and testing of newtechnologies and, after ploject completion, for LS non-salary operatingcosts for public sector tasks. To avoid creating cash flow problems forFNEC, it was agreed that FNEC would retain 50% of these taxes in PYI and30% in PY2. Beginning in PY3, the full transfer of these taxes to LS wouldsupport the Livestock Development Fund without endangering FNEC'sviability. It should be noted that these revenues would be the only directcontribution of the private sector to Government, as no customs duties oninputs or export taxes on cattle are levied. These taxes are, therefore,the most simple and effective means of recovering part of governmentalexpenditures for the subsector. A condition of Credit effectiveness isthat Government had taken appropriate action to designate the taxes andvaccination fees as direct revenues to LS (para 70(b)).

46. Organizational Aspects. The Action Plan provides for: (a) areducticnt of 37% in the number of LS staff over a three-year period; (b) a

- 15 -

reduction of the number of hierarchical levels within LS by elimination offive provincial inspectorates and 45 subsector posts; and (c) amodification of the present bonus system to reflect actual individualperformance, improve staff supervision and personnel administration andprovide a genuine system of incentives.

47. Personnel Aspects. Staff reduction would be achieved throughattrition, transfer to other services, and early retirement with redundancypayments. Redundancy payments, amounting on average to 2 years salary,could be combined with loans from the Agricultural Development Bank tostart modern livestock enterprises or private veterinary practices.Government has agreed to prevent reemployment of staff having benefitedfrom redundancy payments. The Staff Reduction Plan has been developed inclose collaboration with the Government's civil service reform team andwould be integrated into an overall staff reorganization of MDR. Tostrengthen LS personnel management and control, all personneladministration activities, including payroll, would be transferred from theTreasury to the LS Directorate General. Assurances were obtained atnegotiations that, from June 1987 onwards, Government would deposit allsalaries into the LS account not later than five days after the end of eachmonth (para 69(c)). LS administration would then be adequatelystrengthened to handle the increased administrative load. The customarybonus system for local staff involved in major projects--which now benefitsall higher-level staff--would be modified to benefit only those staff whoperformed well as determined by an annual evaluation. Important criteriain this evaluation would be performance in the staff retraining programs(para 37) and FNEC local representatives' assessment. Furthermore,eligibility criteria and levels would be unified for all externally fundedprojects under MDR supervision. Tentative levels were discussed duringnegotiations, and final submission of a uniform bonus system satisfactoryto IDA, and its promulgation by Government, would be a condition of Crediteffectiveness (para 70(c)).

2. Organization and Management

48. FNEC/LS Linkages. The project would be carried out under MDRsupervision by the LS Directorate General and by FNEC, with support fromthe PMU (para 42). As under WLP, the project would be managed by FNEC'sSecretary General and the LS Director General, who would shareresponsibility for the execution of their respective work programs andbudgets with the internationally recruited co-director, as shown in theorganization chart in Annex 3-7. Further assistance would be provided bythe internationally recruited financial controller, who would administerthe finances of both FNEC and LS. The existing Coordination Committee(para 18) would continue to supervise FNEC's activities and coordinate FNECand LS project activities. Work programs approved by the Committee wouldbe executed by FNEC's Input Distribution and Pastoral OrganizationDepartments (Annex 3-8).

49. Within the restructured LS, the Director General would be solelyresponsible for the overall planning of the subsector and for all control

- 16 -

functions outside the project, but would have joint responsibility with theproject co-director for all project activities. These arrangements, whichenable the Director General to share difficult management decisions withthe co-director, have worked well during the last two years of WLPexecution and should be maintained during the crucial period of LSreorganization. The shared responsibility would involve the preparationand execution of annual work programs and budgets, the development andimplementation of the staff bonus and evaluation systems, the authorizationof project expenditures, and the operation of the Livestock DevelopmentFund. Assurances were obtained at negotiations that the Secretary Generalof FNEC and the Director General of LS, assisted by the projectco-director, would submit to IDA and all cofinanciers their respectivequarterly and annual progress reports showing actual and budgetedexpenditure, statements of financial progress, and objectives by projectcomponent for the forthcoming period (para 69(d)). The Directorate Generalwould be reorganized into four departments: Administration and Finance,Extension and Training, Pastoral Settlement, and Research (Annex 3-9). Atnegotiations, assurances were obtained that the posts of LS DirectorGeneral, the two Regional Directors and the Head of Administration andFinance would at all times be filled by staff with experience andqualifications acceptable to IDA (para 69(e)).

50. The operation of the Livestock Development Fund (para 40) wouldalso be under the direct responsibilitv of the LS Director General and theproject co-director. Assurances were obtained at negotiations that, duringproject implementation, Covernment would submit, before October 1 of eachyear, detailed annual work programs and budgets for IDA's approval (para69(f)). Each work program and budget would include advance requests fromIDA/IFAD for that year (para 60), and expected national revenues (Annex3-6), and would provide details on the type, amount, and location of theinvestment planned, the specific technology to be tested and the expectedbeneficiaries, as well as the numbers of staff to be reduced in eachcategory, and the amounts of redundancv payments projected for thefollowing year.

51. Technical Assistance. Government is aware that technicalassistance is necessary to alleviate the lack of experienced localtechnical and managerial staff. A total of 28 man-years (in financialcontrol and pastoral organization for FNEC, in extension, training,research and pastoral settlement for LS, and in project management forboth), including 3 man-years under the PPF, together with 54 man-months ofshort-term consultancy and 24 man-years of French volunteeis services wouldtherefore be provided. Annex 3-10 gives the background of the TA services.Terms of reference for the TA staff are available in the Project File No.225.990 (6). An implementation schedule is provided in Annex 3-11.Assurances were obtained at negotiations that IDA's approval ofqualifications and conditions of employment would be obtained prior to theemployment of IDA/IFAD-financed TA personnel and short-term consultants(para 69(g)). The signing of satisfactory contracts concerning theco-director and the financial controller would be a condition of Crediteffectiveness (para 70(d)).

- 17 -

3. Present Status of Project

52. Most of the current activities of WLP are already geared towardthe initial implementation of the project. This trend is being acceleratedunder the PPF advance. Bidding documentation for the office and researchlaboratory is being prepared and the first mobile herder training team isbeing launched. Thne PPF advance will allow the TA staff of WLP to beretained for this project, thus ensuring a fast and efficient initialimplementation. The modified regulation for sale and slaughter oftrypanotolerant cattle and the subsidiary financial agreements are beingprepared by Government, to avoid possible delays in Credit effectiveness.

D. Project Costs and Financing Plan

1. Project Costs

53. Total project costs over a five-vear period are estimated at CFAF14.4 billion (US$37.3 million), with a foreign exchange component of 52%.They include implicit taxes on locally procured items, but exclude taxesand import duties on direct imports, since Government has indicated thatthey would be waived. Cost estimates are based on early 1986 prices andinclude physical contingencies of 10% on all costs, except technicalassistance which carries 5% and local salaries, incentives and redundancypayments which do not require such a provision. Price contingencies havebeen calculated according to Bank guidelines at 7.0% for 1986 and 1987,7.5% for 1988, 7.7% for 1989, 7.6! for 1990, and 4.5% for future years forthe foreign costs, and at 8% per year (current inflation is 5.6%) for thelocal cost component. Total contingencies are equivalent to 27% of basecost estimates, or 21% of total costs.

54. Project costs include US$17.4 million of investment costs, andUS$19.9 million of operating costs, US$10.6 million of which isnon-incremental. Details on project costs and on the relation of projectsize to the national economy are in Annex 3-12. Project investment costsrepresent about 10% of MDR's present and proposed investment budget. TheUS$10.6 million non-incremental costs include US$4.j million from Govern-ment for LS staff salaries, US$5.7 million from FNEC for the purchase ofveterinary drugs, and US$0.4 million from FNEC for its regular staffsalaries. These costs are included in the total cost because they form anintegral part of the project, but would not be externally financed. TheUS$9.3 million of incremental operating costs would be financed by IDA(US$3.3 million), IFAD (USS1.1 million), EDF (USSO.4 million), Government(US$3.6 million equivalent) and FNEC and producers (US$0.9 million).Goverment's contribution mainly covers local salaries and its contributionto the Livestock Development Fund. Experience under WLP shows that localsalaries are normally paid in time and would not hamper projectimplementation. No difficulties are expected concerning FNEC's andproducers' contributions.

- 18 -

2. Financing Plan

55. Total foreign financing would amount to US$22.2 million, whichwould cover 60% of total project costs and 83% of incremental costs. Threecofinanciers have confirmed their intention to cofinance the project. FAChas confirmed its contribution. evaluated at about US$1.1 million, forexperts, volunteers and some equipment to strengthen FNEC's pastoralorgani:Rtional and training de'artment and to assist the Bouar College.EDF has made provisions for a zontribution of about US$5.4 million towardthe projecL to finance the FNEC input distribution and LS pastoralsettlement components, and the feeder road component in the eastern part ofthe country. IFAD has confirmed its participation in cofinancing 25% ofthe remaining components (US$3.8 million). The EDF and FAC contributionswould be in the form of grants and IFAD's in the form of a loan on highlyconcessional terms. Effectiveness of the IDA Credit would be conditionalon the effectiveness of the IFAD loan and Government's agreement to thefirst FAC advisor financed under the FAC grant (para 70(e)). Furthermore,assurances were obtained at negotiations that Government would execute theEDF agreement bv June 30, 1987, or by that time would have securedalternative financing on terms and conditions acceptable to IDA(para 69(h)).

56. On the basis of these cofinancing arrangements, the proposed IDACredit of US$11.9 million would finance 32% of the total project costs (35%of the foreign costs and 29% of the local costs). The IDA Credit would beused to finance construction, vehicles, equipment, technical assistance,and some local salaries and operating costs for the following: (a) MNEC'sadministration and financial department; (b) FNEC's pastoral organizationand training; (c) LS extension, vaccination and staff retraining; (d) LSresearch; (e) LS Livestock Development Fund; (f) infrastructure in thewestern part of the country; and (g) project management. Non-salaryoperating costs would be taken over by the Livestock Development Fund afterproject completion; Government's direct contribution to LS would not needto be increased in real terms (para 63). Annex 3-13 provides details onthe financing plan by project component and by foreign and localexpenditures (including taxes). A grant equivalent to US$2.5 million wouldbe made from the proceeds of the Credit (USSi.8 million) and IFAD Loan(US$0.7 million) to FNEC under a subsidiary grant agreement betweenGovernment and FNEC. The signing of this subsidiary Grant agreement wouldbe a condition of Credit effectiveness (para 70(f)).

57. Accounts and Audits. At Credit effectiveness, and upon requestfrom the Borrower, IDA would make an initial deposit of US$300,000 to aSpecial Account to be operated by the Project Management Unit. Separateaccounts would be opened for the EDF and IFAD contributions. Governmentwould furthermore open one account for local LS salary transfer from theTreasury and one account to operate the Livestock Development Fund. Theopening of these two accounts would be a condition of Credit effectiveness(para 70(g)); more details cn the operation of accounts are provided inAnnex 3-14. The LS and FNEC have fulfilled their audit obligations underthe earlier project, and their audit reports have been generally on time.

- 19 -

Government and FNEC audited accounts and audit reports, especially on theLS salary account and the Livestock Development Fund, would be submitted toIDA within six months after the end of each ffscal year.

E. Procurement and Disbursement

1. Procurement

58. All goods, works and services financed by IDA would be procuredfollowing Bank guidelines. Contracts for US$150,000 equivalent or morewould be awarded through international competitive bidding (ICB) inaccordance with IDA guidelines. Contracts below US$150,000 equivalentwould be awarded through local competitive bidding (LCB) according to localprocedures which are acceptable to the Bank, with contracts for less thanUS$50,000 equivalent being awarded on the basis of quotations from at leastthree suppliers. Procurement arrangements are given below, with amounts tobe financed by the IDA Credit in paientheses.

AMOULNTS AND METHODS OF PROCUREMENT(USS '000)

Cofinancfers TotalProcurement Element ICB LCB Procurement - Other Costs

Civil Works 2,100 600 - 3,800 100 6.600

(1.500) (500) - - (2,000)

Vehicles, Equipment 2.100 600 - 600 - 3,300

and Materials (1,600) (400) - - (2,000)

Technical Assistance, - - 1,700 5,000 .S- 6,700

Training and Studies - - - (3,700) (3,700)

Operating Costs. - - 400 12,600A/ 13,000

Maintenance and - - - (3,400) (3.400)

Local Salaries

Drugs - - - 5,700 e/ 5,700

Livestock Development - - - 1.500 1 'D0

Fund - - - (300) (3''0)

Project Preparation - - - 500 500

Facility - - - (500) (500)

Total 4,200 1,200 6,500 25,400 37.300

(3 10 9 - 17 9o) fl 00) .-. __ . 222_ .. L2 _.L2)

a/ Subject to EDF and FAC procedures.

b/ Contracts of less than USS150.000.

ci TA. Training and Studies would be procured following Bank guidelines.

d/ Mostly salaries and operating costs of LS. IDA financing necessary

due to Government's extremely difficult financial position.

e/ Drugs, which are non-incremental, would be purchased by FNEC in small

quantities on the basis of criteria other than rrice alone. Direct

purchase from the respective manufacturers would therefore be

appropriate.

- 20 -2. Disbursements

59. The IDA Credit (US$11.9 million) would be disbursed over aseven-year period (Annex 3-15). The rate of disbursement follows that ofthe Bank standard disbursement profile for area development projects inWest Africa, which reflects the project inputs more accurately than theprofile for livestock projects which is biased toward ranch development.The proceeds of the IDA Credit would be distributed as follows:

DISBURSEMENT OF IDA CREDIT(US$ '000)

Percentage ofExpenditures to

Category Amount be Financed a/(US$ '000)

(1) Civil Works: 75X(i) FNEC 200(ii) LS 1,600

(2) Vehicles, Equipment,and Materials for: 75%(i) FNEC 400(ii) LS and Project Management 1,400

(3) Technical Assistance,Training and Studies: 75%

Ci) FNEC 500(ii) LS and project management 2,800

(4) Operating Costs, Maintenance andLocal Salaries for: 75%vi) FNEC 600(ii) LS: b/

Tranche A 700Tranche B 700Tranche C 400

(iii) Project Management 600

(5) Livestock Development Fund 300 75%

(6) Refunding of ProjectPreparation Facility 500 100%

(7) Unallocated 1,200

Total 11 900

a/ Of components cofinanced by IDA, pari passu 3:1 with IFAD.b/ See Institutional Reform Action Plan, Annex 3-6.

- 21 -

60. Disbursement against vehicles, equipment, materials, technicalassistance, training, audits and studies would be fully documented, anddisbursement against civil works, operating costs, maintenance and localsalaries would be against statements of expenditures certified by theproject co-director and the financial controller. Disbursement for theLivestock Development Fund would be as an annual advance into the LSoperational account on the basis of the budget approved by IDA, and acertified statement of expenditure afterwards. Full documentation would beretained by FNEC and LS for review by IDA supervision missions and indepen-dent auditors.

61. Cost Recovery. Herders would pay the full purchase and dis-tribution costs of the drugs and would be fully responsible for the mainte-nance of the dipping tanks. Through the Market and Trypanocide taxes andthe vaccination fees, producers would directly finance the non-salaryoperating expenditures of the LS for its extension and vaccinationactivities.

F. Production, Markets and Prices

62. Annual incremental production as a result of the project would be2,600 tons of meat and 6,000 tons of milk in PY5 and 15,000 tons of meatand 26,000 tons of milk by PY20. The national cattle herd would increasefrom 2.2 million to 2.4 million head by PY20, against 1.8 million withoutthe project, due to the prevailing high disease level (Annex 3-16 andProject File No. 225.990 (5)). The export prospects for the increasedproduction are favorable. The increased meat production would be almostentirely exported, making thus a significant contribution to the country'sbalance of payments. West Africa is meat deficient and if the presentsupply and demand trends continue, it will need to import 2.0 million tonsannually by the year 2000. Nigeria will continue to exert a strong demandon neighboring countries. The actual farmgate price of CFAF 220/kgliveweight is therefore assumed to remain stable in constant 1985 terms.This price corresponds to US$900/ton of carcass, which is significantlybelow the current world market price of US$1,500-2,000/ton c.i.f., northernNigeria; in addition, the Nigerian consumer prefers the leaner CAR product.Most of the incremental milk production would be sold directly to villagersor consumed in households. Studies are underway for a processing plant in'angui, and the pilot, small cheese-making plant to be tested under theproject would also be a possible outlet. A stable milk price ofUS$0.18/liter in constant 1985 terms (CFAF 80/1) at farmgate is thereforeassumed.

- 22 -

G. Financial Results, Economic Benefits and Project Risks

1. Financial Results

63. For the herders who adopt the health package, offtake and herdgrowth would increase by about 2% in PY5 and 3% in PY8, and the value oftheir herds by CFAF 350.000 (US$910) in constant terms from PY1 to PY5.For Government, a main feature of the project after completion is thatrecurrent expenditures would not need to be increased. The cash flows ofboth FNEC and LS would be expected to improve significantly under theproject, as shown in Annex 3-17. Higher drug sales would increase FNEC'sincome, which would more than offset the loss of income from the transferof Market and Trypanocide taxes and vaccination fees to the LS. At LS, theimplementation of the Action Plan would result in a saving of CFAF 125million and an income of CFAF 235 million for non-salary operating costs atproject completion (current prices). As a result, the ratio ofsalary/non-salary operating cost would change from the present 99.5:0.5 toabout 70:30 in PY5 (CFAF 600 million:CFAF 235 million). The total burdento Government, including adequate funds for road maintenance, wouldincrease from the current CFAF 550 million to CFAF 750 million afterproject completion. This means that Government's direct contribution wouldhave to increase only in line with the projected inflation rate (8Z), whilethe increase in the share of non-salary operational costs would greatlyenhance LS operational capability.

2. Economic Benefits

64. The principal benefit expected from project activities is thatthey would provide the CAR's livestock subsector with a viableinstitutional framework for delivery of inputs and advice to producers.This, in turn, would lead to the production increases detailed above, tohigher incomes, improved nutrition and higher exports. The project'seconomic rate of return (ERR) is estimated at 15%. The ERR was calculatedby taking the economic costs of the project for the first five years andoperational and vehicle replacement costs for the remaining 15 years. Thebenefit stream is the sum of the incremental value of meat and milk and themeat value of herd increment that would result from increased fertility anddecreased mortality rates. Net present value (NPV), with the opportunitycost of capital set at 122, is about US$7.4 million. The sensitivityanalysis indicates that a decrease of 10% in benefits would lower the ERRto 14%, while a decrease of 20% would lower it to 122. A lag in benefitsof one year in benefits would reduce the ERR to 13% and a lag of two yearsto 12%. Eliminating the research and pilot operations, and theinfrastructure component from the costs would raise the ERR to 20% and theNPV to US$15.8 million. The major underlying assumptions in the costbenefit analysis are shown in Annex 3-18. About one-third of the totalproject costs would be directed toward the poorer strata. Project benefitswould be fairly equally distributed between poorer and wealthier producers,with the former benefiting most from the settlement component and otherpilot activities and the latter benefiting most from the drug distributioncomponent. Annex 3-18 also elaborates on the poverty impact of the project.

- 23 -

3. Project Risks

65. There are no major technological risks in the proposed generalanimal health package. The veterinary drugs have proven their effective-ness in the CAR and there is a strong producer demand for this package.Drug resistance resulting from under-dosing by laymen--the only significantrisk--would be reduced through the training program for producers andassociation pharmacists, follow-up by the LS, restriction in the number andtype of drugs sold, and the establishment of a well-equipped diagnosticlaboratory to monitor drug resistance.

66;^ Pastoral organization, and in particular the pastoral settlementscheme, might be considered risky since these types of operations haveoften failed in West Africa. However, climatic conditions in the CAR aremore favorable for settlement than in the Sahel, where most experience inpastoral organization originates. Furthermore, initial experience underWLP has been successful and the same approach of working within thetraditional structures by creating herder associations to provide a servicewhich the producers regard as worthwhile would be maintained.

67. The major Institutional risk would arise from poor motivation ofLS staff and their lack of communication with the producers. However, themodified bonus system, the LS reorganization including improved internalcommunications, and a systematic control system of field staff wouldminimize this risk. The stability and competence of FNEC leadership andadministrative and financial management due to the limited availability ofcapable people would be a second concern. However, the revision of FNEC'sstatutes, the recruitment of an experienced financial controller, thetraining component for young herders, and the strengthening of theCoordination Committee would consolidate and enhance FNEC's positiveperformance.

4. Environmental Risks

68. The project does not carry any substantial environmental risks.The insecticide used in the cattle dips (Lindane) is considered safe forgeneral use. Precautions would be taken, however, not to pollute streamswith effluents. The tsetse control screens and traps made of pyrethroidcompounds are environmentally safe. Overgrazing would not be an issue atthe national level since the growth of the cattle herd would still be farbelow the national carrying capacity. Finally, at local levels, the pilotpastoral settlement scheme would result in better grazing managementpractices and in the development of a stable and long-term land use system.More information on the environmental impact of the project is provided inAnnex 3-18.

- 24 -

IV. AGREEMENTS REACHED AND RECOMMENDATION

69. At negotiations, agreements were reached regarding:

(a) maintenance of roads rehabilitated under the project (para 41);

(b) institutional reform under the Action Plan (para 44);

(c) deposit of salaries into the LS salary account (para 47);

(d) submission of quarterly and annual progress reports, and workplans and budgets (para 49);

(e) the posts of the LS Director General, the two Regional Directorsand LS Head of Administration and Finance would at all times beheld by staff with experience and qualifications acceptable toIDA (para 49);

(f) submission of detailed work programs and budgets for theLivestock Development Fund (para 50);

Cg) IDA approval of the qualifications and conditions of employmentof TA staff and short-term consultants (para 51); and

(h) by June 30, 1987, the EDF grant agreement would have beenexecuted or the Government would have found alternative sourcesof finance on terms and conditions acceptable to IDA (para 55);

70. Conditions of Credit effectiveness would be that:

(a) the sale of trypanotolerant cattle had been deregulated(para 13);

(b) Government had designated the Market and the Trypanocide taxesand other revenues generated by LS vaccination fees as directrevenues for non-salary operating costs of the LS (para 45);

(c) MDR had issued a decree establishing a uniform uOnus schemeacceptable to IDA for staff in all externally funded projectsunder MDR's supervision acceptable to IDA (para 47);

(d) the contracts of the project co-director and the financialcontroller had been signed (para 51);

(e) conditions precedent to the effectiveness of the IFAD loanagreement had been fulfilled, and one FAC advisor had been agreedupon by Government (para 55);

(f) the subsidiary grant agreement had been executed on behalf ofGovernment and FNEC (para 56); and

- 25 -

(g) two LS accounts had been opened to receive Governmentcontributions for salaries and non-salary expenditures,respectively (para 57).

71. A condition for the release of each of the last two tranches ofthe LS operating costs would be Government's timely and satisfactoryperformance in meeting the Action Plan conditions (para 44).

72. With the above agreements, the project would be suitable for anIDA Credit of US$11.9 million equivalent.

WAPADMarch 1986

I~~~~~~~~~~T LH~ 0 e r

,~~~~~~~~Ij I iii lI

.,~~~~~~~~~~~~~~~I iiE 88 C Ii -A 7

I Li L..... ...... .....

- 27 -

Annex 2-1Page 1 of 2

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

LIVESTOCK IN THE ECONOMY

Livestock production contributed CFAF 36.6 billion (US$80million) of value added to GDP in 1984. Three-fourths of this productioncome from cattle, 10% from small ruminants, 82 from pigs and 6% froimpoultry. The large share of cattle is caused bv an influx of Fulanis withtheir trypano-sensitive Zebu cattle from Cameroon, Nigeria, and Chad intothe CAR.

While the earlier Fulanis established themselves on thetsetse-free western plateau, increased pressure forced subsequentimmigrants to spread over most of the Western and Central tsetse-infestedparts of the country and to develop a svstem based on curative andpreventive trypanocide drug regimes. The historical development of thecattle population in the CAR over the last 50 years is shown below.

Estimated TotalYear Cattle Population

('000)

1936 1641950 2601960 3521980 9001984 2,100

Source: Ministrv of Rural Development.

Trypanotolerant cattle were introduced in the CAR in themid-1950s. Because of their higher degree of tolerance againstTrypanosomiasis and skin diseases, these cattle developed well diring the1960s and increased from an original importation from Guinea of 3,000 inthe 1950s to 15,000 head by 1969. Thev were disseminated under ashare-cropping system, whereby the Livestock Service provided animals onloan to be repaid bv the farmer with the same category of animals after 3-5years. The deterioration of the LS in the 1970s halted this activ;ty.Instead, a restrictive legal framework was imposed (and still exists),prohibiting all sales and slaughtering of trvpanotolerant cattle. As aresult, the total number declined over the last decade and now starnds at7,500 head. The rehabilitation of this activity is important, as it is theonly cattle breed owned by the indigenous population.

- 28 -

Annex 2-1Page 2 of 2

Eighty percent of the meat consumed comes from cattle, SZ fromgoats, and the remainder from the other livestock categories. Total annualdemand is estimated at about 36,000 tons, which seems covered bv the localsupply. Only about 24 tons of meat and meat products were imported in1984, mostlv from France and South Africa, and mainly for the high incomeexpatriate class in the capital. Imports and exports of live cattle aredifficult to assess; official records for 1984 (which are rrobablyunderestimated) show that 9,000 head were imported from Sudan and 15,000head exported to Cameroon and Nigeria. Dairy imports amounted to 1,500tons in 1982 for a value of CFAF 25 billion, or 12% of the total foodstuffimport bill.

WAPADMarch 1986

Annex 2-2- 29 - Page I of 3

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

PHYSICAL AND SOCIAL ENVrRONMENT

CAR's climate varies from Sub-Sahelian, with an average annualrainfall of 700 mm in the extreme north, to inter-tropical with 1,100 mm inthe central rart and to equatorial in the southwest. Its topographyconsists of a vast plateau with gently sloping hills, cut by many streamsand rivers. Its vegetation consists of a woodland savannah in the northernand central parts and equatorial forest in the south.

Geographical Distribution

Cattle is found only in the northern and central savannah withthe highest concentration still in the regions borderlng Cameroon and Chad,the countries of origin. Thus, the western and north vestern provinces ofOuham Pende, Nana Membere and Ouham contain approximately half of CAR'scattle population. More recently, pastoralists have moved southwards andeastwards to the central provinces of Ombella M'poko and Ouaka, which nowcontain 17% and 9% respectively of CAR's national cattle herd. Trypano-tolerant cattle are kert mostly by wealthv cultivators. Goats are moreevenly distributed, with the highest density in the central part of thecountry. Sheep are kept in the northern rart of the country. Poultry andpigs are mostly kept by villagers throughout the country, although a smallnumber of semi-intensive production units have been recently establishedaround Bangui.

Socib-Economic Conditions of the Herders

The Fulanis form a highly structured society in which the basicunit consists of 10 to 20 families of approximately 9 persons each, groupedaround a traditional leader, the Ardo. These groups are normally based onkinship relationships. Several Ardos pledge allegiance to the regionalleader, the Grand Ardo. The mayor of the Livestock Conmunities and theFNEC district representative are recruited from this upper stratum.

- 30 -

Annex 2-2Page 2 of 3

Cattle wealth and income among the Fulanis are distributed asfollows:

Estimated EstimatedWLP (1982) a Bossembele b Income Income

(1985) per family per capitaNumber of Cattle (Z) (XUSS) (US$/yr)

Less than 50 25 14 750 13850 - 100 29 30 1,260 190100-200 29 4i 1,600 205More than 200 17 15 2,380 220

a/ Carried out by the proiect Monitoring Unit of WLP.bI Carried out by an independant consultant in the Bossembele Region.

Thus, if 40% of p-.r capita GNP (US$270) is assumed as the povertythreshold, approximatelv one-fifth c' the population can be classified asrural poor.

Milk from the herd and cultivated or rurchased cassava and cornmeal are the main staples. Because of the high level of milk consumption(0.7 liter per person per dav) protein and caloric requirements are met,although seasonal deficiencies (dry season) occur especially among thepoorer families.

A small number (1-10 head) of cattle is frequently kept by women,who often also own some goats. Women also receive the revenues of all milksales, which constitute for the poorer families approximately 20% of familyincome. Cassava flour is mainly purchased from these milk revenues. Thelivestock producers, therefore, form an important part in the rural economyand in manv remote areas they constitute the onlv market for foodcrops.

The Fulanis are becoming more and more involved in cropping. TheBossembele survey finds that more than 50% of the Fulanis are cultivatorsand the socio-anthropological survey found that 30% had settledpermanently. It is mainly the poorer herders who settle, as their herdsize drops below the minimum required to maintain the family and thesubsistence from livestock has to be supplemented by cultivation.

Expenditure patterns vary alsc with livestock wealth. Poorerfamilies spend a proportionately higher than average percentage of theircash resources on food and lower than average percentage on both personaland animal health. At the same time, the survey found that poor herdersspend more on a per head basis on livestock inputs and drugs. They alsohave a significantly higher offtake than wealthy herders.

- 31 -

Annex 2-2Page 3 of 3

Herd Size Annual Expenditure per headOfftake of Cattle (US$/year)

(Z) All Inputs Drugs

0-50 16.9 3.75 0.9550-100 12.3 2.50 0.50

100-150 9.4 2.25 0.4025n-200 6.0 1.75 0.30

More than 200 5.7 1.35 0.30

Source: Bossembele Survey, 1985.

Thus, the poor stratum would especially benefit from the proposed-settlement activities, which would have a strong cropping component. Thevealthy stratum would benefit most from the expansion of drug distributionactivities.

VAPADMa-rch 1986

- 32 -

Annex 2-3Page 1 of 2

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

TECHNICAL CONSThAINTS AND OFFTAKE

Animal Health

Diseases are the most serious constraints producers face. Themain threats are:

(a) Trypanosomiasis. This disease, transmitted by the tsetse fly, isresponsible for only 15% of the mortality, but is probably themost costlv in terms of reduced overall production andexpenditure on drugs. Except for the high elevated areas in theextreme western part, the entire country is infested by the fly.The main subspecies are the savannah species (G. mortisans) inthe northern half of the country and the riverine species(G. tachnoides) in the rest.

(b) Internal parasitism. This is the main cause of direct mortality,causing 35% of calf deaths and 20% of overall mortality.According to a retrospective survey carried out under WLP, only30% of the producers uses a de-worming drug.

(c) Ticks and tick-borne diseases (Piroplasmoses and Ricketsiosis).The diseases cause another 15% of annual mortalitv. To controlticks, there are about 30 cattle dips vith a capacity of about10,000 head each. Most of them, especially those managed byFulani leaders, function well, although access to the dips issometimes accorded arbitrarily, favoring wealthy producers fromthe same ethnic subgroup. A beneficiary's contribution of CFAF15 per head dipped was introduced in 1984, which is used by theFulani leaders to purchase insecticides and maintain the dips.

(d) Contagious Bovine Pleuro-Pneumcnia (CBPP). This disease,eradicated from the CAR in the 1960s, rearreared with the recentinflux of cattle from neighboring countries and is now apersistent threat, with occasional outbreaks affecting 5-102 ofthe cattle population each year.

(e) Brucellosis. A recent survey showed a 25% positive bloodtitrefor Brucellosis in the western region and 10% in the centralregion, thus causing a severe reduction in the calving rate.

- 33 -

Annex 2-3Page 2 of 2

(f) Pasteurellosis. Incidental outbreaks of this disease occur in thewet season, affecting only a small portion of CAR's cattleropulation.

Rinderpest, which in other Western Acrica countries is one of themain killers, was efficiently controlled in early 1983 following an initialoutbreak in the Ouham Pende province. Since then, three annual vaccinationcampaigns, with a satisfactory average coverage of 70Z, have been carriedout and CAR is now the first Western Africa countrv with an adequatelyinuunized national herd, that can limit its vaccination to calves. CAR isalso one of the few countries in the region that has instituted avaccination fee (CFAF 50 per head).

Feed Resources

Total grazing land available in the CAR is approximately160,000 km2, which at an average stocking rate of 5 TLUs 1/ per ha, couldcontain 3.2 million TLUs, or double the present population. Additionally,the country produces annually 30,000 tons of cotton seed and 4,000 tons ofpalm kernel cake which could also be used as livestock feed. Moreover,starting in 1988, an additional 2,000 tons of molasses per year can beexpected from a new sugar plantation near Bambari.

Locally, however, bush encroachment and the invasion of weeds,like Laos grass (Chromolaena odorata) partly caused by bad grazingmanagement, are becoming serious probl.. -:. Pasture degradation isespeciallv serious in the Ouham Pende and Ombella M'poko provinces and iscausing herders to abandon certain locations. The herders frequently citethis as one of the more serious problems they face. Animal production iEfurther impaired by the low qualitv of the dry season feed. The savannahvegetation matures rapidly in this humid area, which is poor in edibleshrubs and trees.

WAPADMarch 1986

1/ One Tropical Livestock Unit (TLU) equals one cow of 250 kg liveweight.

- 34 -

Annex 2-4Page 1 of 2

CENTRAL AFRICA REPUBLIC

NATIONAL LIVESTOCK PROJECT

LIVESTOCK INSTITUTIONS

The LivestocK Service (LS). The Directorate General of Livestockand Animal Industries of the MDR consists of a Directorate of Productionand Animal Industries and a Directorate of Animal Health. At the fieldlevel it is organized into a regional inspectorate, five provincialinspectorates, covering 15 sectors, each of which corresponds to aprefecrire. These sectors are in turn subdivided into 45 subsectors and182 veterinarv posts.

The LS staff has been well supplied with transportation andequipment at headquarters and inspectorate level by the two livestockprojects.

The techrical competence of LS staff is extremely low. A surveycarried out in 1984 showed, for example, that less than 50% of the agentscould recognize the principal diseases and that only one-third of themcould calculate the correct dosages of the drugs against them. Added tothis lack of technical knowledge is a lack of practical experience ingiving injections and treating wounds.

Staff Training. Higher level training in agriculture is providedin the CAR bv the Higher Rural Development Institute ("Institut Surprieurde Developpement Ruralt' - ISDR), which trains in general agriculture withspecialization in animal production in the last two vears. Higher levellivestock technicians are being trained in neighboring countries (Chad,Cameroon, and Mali). Middle level technicians are trained at the TechnicalCollege of Bouar, which is supported by WLP. After its reorientation in1982, the College now provides a three-vear course not only for future LSagents, but also 'or private producers and private veterinary auxiliaries.However, without other support- measures, their graduates find it difficultto start in the private sector.

The National Federation of Livestock Producers (FNEC). Aprivate, fairlv effective association of Fulani pastoralists such as FNECis unique in West Africa. It has developed into a significant politicalforce in the country and although its image needs to be improved at thegrassroots, it is generallv respected. Approximately 60% of the herderspay their contributions regularly. At the field level, FNEC is representedby 15 provincial representatives who are mostly wealthy cattle owners ortraders appointed by FNEC's Secretary General. These representatives levythe membershlp fee, organize the producers participation in the vaccinationagainst Rinderpest and often sell drugs and other inputs.

- 35 -

Annex 2-4Page 2 of 2

FNEC derives its income from membership fees, marketing taxes,vaccination fees against Rinderpest and from profits on the sale of drugs,according to the following breakdown:

T'YFe of Income Rate Total Revenuein 1984

Membership fee USS22 per year rer producer US$134,000with more than 30 head ofcattle

Marketing Tax US$2.20 rer head, sold at markets USS 19,000

Trvpanocide Tax US$1.30 per head, sold at markets USS 40,000

Vaccination Fee US$0.05 per head vaccinated US$ 60,000

Gross Profit on Drugs 462 US$135,000

Total

The Slaughterhouse Management Company ("Societe d'Exploitation etde Gestion des Abattoirs" - SEGA) is responsible for the management of theslaughterhouses in Bangui, Bouar, and Bambari. The Bangui slaughterhouse,financed by EDF, is currently slaughtering 35,000 heads per year or 702 ofits mdaximum capacity in its modern installations. Its hygienic conditionsand management are poor, and despite a reasonably high slaughter fee (US$10per adult cattle), the operation loses monev. The slaughterhouses of Bouarand Bargui are of much simpler construction and seem to operate well.

WAPADMarch 1986

- 36 -

Annex 2-5Page 1 of 2

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

THE WESTERN LIVESTOCK PROJECT

Veterinary Drug Distribution

Total sales of veterinarY drugs increased dramatically since ANECwas given the responsibility for this component, as shown below.

Sales ResponsibleYear (Million FCFA) Entity

1980 1.9 LS1981 13.2 LS1982 (01-09) 13.7 LS1982 (09-12) 32.5 ANEC1983 54.9 ANEC1984 138.0 ANEC1985 (est.) 300.0 ANEC

Assuming standard dosages and frequencies of treatment, thefollowing percentages of CAR's cattle population were reached bn theproject in 1984.

Insecticides against ticks 20Curative drugs against Trvpanosomiasis 22Preventive drugs against Trypanosomiasis 1De-worming drugs against parasites incalves 15

Vaccination against Antrax 33Vaccination against Pasteurellose 3

While these coverage percentages are still low compared with thetotal need, they compare favorablv with those of other countries in thesame climatic zone.

The percentage of herders reached by this drug distributionsystem in 1984 was estilmated at 75% from a sample of 200 pastoralists inthe 1985 socio-anthropological study and at 55% in the recent survey of theProject Monitoring Unit. The socio-anthropological study as well as the1985 Bossembele survey found that drugs are being used also by poor (0-50head) families. The budget study shoved that on a per animal basis, drugusage by poor herders is higher.

Annex 2-5- 37 - Page 2 of 2

Initially the ANEC representatives were the main sales outlets.However, their coverage proved incomplete and the sales frequently con-flicted with their other activities. A system of sales at village marketsthrough pick-ups was therefore instituted. However, even under thissystem, scarcity occurs and salespeople tend to overcharge, as shown by thePMU (Project File No. 224.717). A more comprehensive approach usingseveral types of outlets as proposed under the National Livestock Projectis therefore necessary.

Training. The field training program has had rroblems in identi-fying the right target audience and correct course format. The initialfocus was on the sons of pastoralists, who were trained during athree-month course to become private veterinary auxiliaries. This trainingprogram was a failure because of the lack of an adequate institutionalframework to absorb these auxiliaries upon their return and the reticenceof pastoralists to have their animals treated by persons outside their ownimmediate family. Trainivg is therefore now focused on the traditionalleaders and their sons, and is closely tied to the establishment of herdersassociations, which have their own revolving funds and pharmacies.Approximatelv 400 pastoralists have now been trained. In the trainingcomronent of the redesigrked WLP, hovever, the results are less encouraging.Graduates of Bouar College do not find viable employment options outsidethe civil service. Government has now agreed to suspend enrollment of newstudents over the next five years. The College still has msnagementproblems and low quality teaching staff.

Pastoral Organization. Twenty herders associations have beenformed under WLP. These associations have normally their traditionalleader as president and, with one exception, have functioned well. Therevolving funds doubled over the first year of operation, and severalassociations have started to sell other inruts (concentrate feeds,medicine) to herders. There is a strong demand from other herders forassistance in forming additional associations. An adapted grazingmanagement scheme has been identified and its supporting administrative andlegislative texts have been drafted and introduced in one herdersassociation.

Impact. Although the overall impact of the project cann'ot befully quantified because data on tne impact of the drugs on animalproductivity are not available, it is clear that the Project has had a verypositive effect on production. The increased sale of drugs resulted in abetter protection of about 300,000 animals against Trypanosomiasis andapproximately the same number of calves against internal parasites.

WAPADMarch 1986

Annex 3-1Page l of 2

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

TECHNICAL PACKAGES

The project would disseminate or test the following technologiesagainst the main constraints affecting livestock production in the CAR.

Diseases

(a) Trypanosomiasis. On a national scale more emphasis would begiven to the use of preventive drugs (now only used by 1% of therroducers) rather than curative drugs (now used by 222 of thepopulation). This preventive strategy is more cost effective.On a pilot scale, the project would test flytraps and impregnatedscreens to reduce the tsetse challenge. The acceptability by theFulanis of this new, environmentally safe iLethod would also beassessed.

(') Internal Parasitism. An increased use of strategic de-worming bythe producers directly would be advocated nationally.

(c) Ticks and Tickborne Diseases. The construction of 18 cattle dipsin the pilot agropastoral areas, combined with a detailedmonitoring program and the testing of new technologies ofcombining drugs and vaccination against ticks, would beenvisaged.

(d) CBPP. Circumferential vaccinations by the LS would be standardprocedure in the case of an outbreak.

(e) Brucellosis. A vaccination program by the LS in areas with morethan 20% of cattle with a positive blood titre would beadvocated.

(f) Pasteurellosis. Sale of vaccines through FNEC and directapplication by producers in high incidence areas would beencouraged by the LS.

(g) Rinderpest. A national vaccination campaign of the young animalswould be organized annually.

- 39 -

Annex 3-1Page 2 of 2

Grazing Resources

(a) Prevention and Control of Weeds. In the 18 pilot settlementareas, a simple grazing management scheme consisting of aone-year defferment of grazing, combined with early fire, wouldbe introduced to reduce weed invasion and bush encroachment(Project File No. 220.644).

(b) Weed Control. Research and pilot testing of low-cost herbicidesand application methods, including ULV (Ultra Low Volume)spraying methods, would be included.

(c) Low Quality Dry Season Feed. Fodder banks, a low input system ofgrowing high quality leguminous fodders, would be introduced tosupplement the natural range in the dry season. This system,developed by the International Livestock Center for Africa (ILCA)in the sub-humid -one of Nigeria and now proposed for testing ona large-scale ur..i!r the National Livestock Project proposedthere, would not only improve the feed quality, but also increasesoil fertility and could therefore be a major link in theintegration of livestock and cropping. The adaptability of thesetechnologies to the Central African conditions would therefore betested on a pilot scale in the settlement zones.

Other Technologies

Small-scale Cheese-Making: Following on the rather successfulcheese factory in the northwestern CAR, which has fallen indisuse after nationalization, the project would test with simplesets of cheese-making equipment the processing of 300-500 litersof milk per day into cheese by some of the progressive, settledproducers.

WAPADMarch 1986

- 40 -Annex 3-2Page 1 of 3

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

FNEC COMPONENT

Financial Management

In addition to the internationally recruited financialcontroller, one additional accountant would be recruited locally and amicro-computer would be purchased for accounting and stock control at FNECand for the finance and administration of the Livestock ServLce. Softwaredesign and training of local personnel would be included in the purchase ofthis computer system to ensure its adequate operation.

Input Distribution

The existing depot at FNEC's headquarters at Bangui would beexpanded with an additional 300 m2 of storage space and 6 pickups to renewthe existing fleet of sales vehicles visiting regular markets; equipment toproduce mineral mixtures and ointments would be purchased. The revolvingfund, created under the WLP (now at about US$300,0O0) would cover a sixmonth supply period in PYl and is therefore considered adequate.

The distribution network would be expanded with one depot and asales point in each district with a significant cattle population. Theywould be large enough (100 m2 ground floor) to store other inputs likemineral mixtures, concentrate feed and animal traction equipment, whichwould also be introduced. The depots would be managed initially bypersonnel paid by FNEC, but would be transferred to the district federationbeginning after three years. when federations would have proven theirviability. All transactions from the depots would be on a cash basis, witha preferential price for the pharmacies of the herders associations.

Although FNEC would not get directly involved in the cattletrade, funds would be provided under this component for FNEC to establish20 simple cattle markets, principally along the Cameroonian border and inthe central part of the country.

Pastoral Organization

The four mobile teams would be key elements in the formation ofherders associations. They would approach the producers in two sessions:an initial training session would cover the usage of drugs andthe need for the creation of an association with a pharmacy to ensure a

Annex 3-2-41 - Page 2 of 3

regular supplv of these drugs; after two months, if the group so desires, afollow-up session would formally establish the association and provide morein-depth training to its managing committee and the pharmacist/auxilidry. Following the experience in WLP, both the chiefs and theyounger herders would be represented in these sessions. and the associationwould be formed, leaving the traditional hierarchical structure intact.

The herders association's pharmacy would be formed exclusively onthe basis of initial contributions of the members and thereafter fromprofit margins on the sale of drugs. Other inputs (human medicines,concentrate feed, and animal traction implements) would be added as soon asthe size of the revolving fund permits. Regular financial controls wouldbe carried out by FNEC's pastoral agents. Statutes for the herdersassociations were developed under WLP (Project File No. 225.989) and areconsidered adequate to initiate this component, although some amendmentsmight be introduced as more experience would be gained in the operation ofthese associations. Following the organization of herders at grassrootlevel, district federations of herders associations would be formed torepresent the herders in FNEC's General Assembly and take responsibilityfor the management of district level livestock development activities, suchas the management of the input depots. Statutes for the federations wouldbe developed under the project.

Based on the experience of WLP, each mobile team would beexpected to establish 12 associations per year, and in each association anaverage of 25 producers would enroll in the training program of that mobileteam. Another 25 producers, although participating in the association,would not take training but through the pharmacy of the association wouldhave full access to all drugs. The following population would therefore bereached.

Project Year

1 2 3 4 5 Total

Associations Formed 24 48 48 48 48 216Producers Trained 600 1,200 1,200 1,200 1,200 5.400Committee Members andPharmacists Trained 96 192 192 192 192 864

Producers not Trainedbut with Access to Drugs 600 1,200 1,200 1,200 1,200 5,400

Producers Reached OutsideAssociations a/ 3,300 300 400 400 500 4,900

Producers not Reached 17,500 15,200 12,900 10,600 8,200 8,200Total Numbers of Herdersand Families b/ 22,000 22,400 22,900 23,400 23,900 23,900

a/ Including producers already covered under WLP.b/ Assuming an average population increase of 2%.

- 42 - Annex 3-2Page 3 of 3

Thus, at project completion about 5,400 producers or 23% of the pastoralpopulatio- would have been directly trained by the project and about 10,800producers or 45% would belong to a herders association.

In addition to the French volunteer, each mobile team wouldconsist of an interpreter and two FNEC staff (pastoral agents), who wouldfully participate in the activities of their mobile teams, but remainbehind in that district for follow-up and control of the newly formedassociations as soon as the mobile teams move to a new district.Progressively up to 35 pastoral agents would be recruited by FNEC to coverthe 31 districts with an important livestock population and the 4replacements for the expatriate volunteers. These pastoral agents wouldpreferably be recruited among association members, but the required levelof formal education necessary to carry out the envisaged control taskseffectively might require that some staff be recruited from LS existingstaff. Adequate pioficiency in the Fulani language would then be a keyprerequisite for recruitment. During appraisal, Fulani leaders andGovernment authorities felt confident that between those two categories asufficient number of suitable candidates would be available, although themission feels that a somewhat lower coverage than one agent per districtmight have to be envisaged, which however would not significantly affectthe success of this component.

Field supervision of this network would be the responsibility oftwo zootechnicians based respectivelv in Bambari and Bouar. All salariesin -his component would be funded initially by the project, but starting inPY4, would gradually be taken over by the district level federations. Theproject would further supply a stationwagon and didactic equipment for thetraining expert and for each mobile team, two picklups for liaison betweenthe regional staff and the mobile teams, mobylettes for the pastoralagents, and finance support staff and other operating expenses. Moreoperational details and specifications in material requirements are in theProject File No. 225.990(1). Finally funds would be provided for theprofessional and technical training at vocational colleges in the Region ofup tolO sons of herders, thus creating a basis from which future leaders ofFNEC could be selected.

WAPADMarch 1986

Annex 3-3Page 1 of 5

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

LIVESTOCK SERVICE COMPONENT

Animal Production and Health Extension

A two-tier training system would be instituted in which theextension expert and the subject matter specialists would train sectorchiefs in 3-day sessions given at 3-month intervals, on specific topics tobe disseminated during that particular trimester. The sector chief wouldthen prepare the livestock agents. Visual aids would also be distributedthrough this system. The livestock agents would visit the herders andmixed farmers according to a prearranged schedule. Initial emphasis wouldbe on the correct use of drugs, in support of FNEC's program, as itconcerns an area that highly interests all producers. Other animalproduction techniques would follow once a routine has been established.Weekly control visits by the sector chief, the introduction of a reportingsystem, regular monitoring studies on the degree of contact between theproducers and staff, and an annual evaluation system based on theperformance of this field would ensure that this much more structuredsystem would be implemented. To accomplish this program, the extensionexpert and his counterpart, the subject-matter specialist and the LSRegional Directorates would be equipped with a total of 4 stationwagon , 3picktps and equipment, and provided with funds to produce extensionmaterial (Project File No.225.990(l).

Subject-matter specialists in trypanotolerant cattle would beassigned to Bangui, Bossembele, and Bambari. The regional specialist inBambari, assisted by a locally recruited ranch manager, would beresponsible for the operation of the Bambari ranch. The project wouldfinance feed, other inputs and operating costs and provide the ranch withpickups and a cattle truck. However, modification of the Ministerialdecrees (2077 MDEL of June 29, 1967 and 39 MAE of September 14. 1982,Project File No.225.977), which-prohibit all sale and slaughter oftrypanotolerant cattle into a new reglementation which liberalizes allsales and only restricts the slaughter of calves and reproductive cowswould be necessary before any development activity could start.

The cold chain for the vaccination against Rinderpest and CBPPwould be renewed with 29 kerosene freezers and 110 cool boxes for theveterinary posts, svringes, and sterilization sets. Starting in 1986, onlythe calves (20Z of the total cattle population) would be vaccinated, asprevious campaigns have resulted in a sufficient immune level of adultstock. The fee of CFAF 50 (US$0.10) per head vaccinated will bemaintained. Transport for the field staff would also be financed throughthe purchase of 39 motorcycles for the sector chiefs and 160 mobylettes for

Annex 3-3Page 2 of 5

the livestock agents. All field level transport material would be providedon a lease basis to the agents to ensure better maintenance.

Retraining of LS Staff

The internationally recruited training expert would take theposition of head of training at the Bouar College and would work with thetraining staff of the College in developing the curriculum and supervisingits implementation. This refresher course would be the College's exclusiveactivity for the next five years, although the last two classes would beallowed to graduate. As these graduates would not have the privilege ofbeing employed in the Civil Service, they would have priority in obtaininga loan from the Agricultural Development Bank to start a modern livestockenterprise or a private veterinary practice. The curriculum would be based.on the task analysis of the sector chiefs and livestock agents made duringappraisal and on an annual evaluation of their skills and knowledge(Project File No. 225.990(l). As the training would emphasize practicalexperience, two weeks of each refresher course for livestock agents wouldbe spent with the producers outside the College.

The College would further be equipped with a bus, two pickups,one stationwagon and didactic equipment, and a cafeteria would beconstructed and equipped. The management of this cafeteria would besub-leased to individuals. Per diem and subsistence allowances related tothe refresher courses would be provided and the revolving fund for thedemonstration farm expanded with US$10,000. A study would be carried outin PY4 to determine the future role of this College, including thepossibil.ty of transforming it into a Superior College.

The proposed reorganization would require additional higher levelstaff as sector chiefs and increased skills on the part of the professionalstaff. The following table summarizes the training needs to be financedunder the project.

No. Location Duration Man-years

Higher Livestock Technician 18 Superior 3 years 54.0Institute,Katibougou Mali

Veterinary Microbiology 1 IEMVT, Paris 6 months 0.5Veterinary Parasitology 1 IEMVT, Paris 6 months 0.5Veterinary Entomology I IEMVT, Paris 6 months 0.5

Agropastoralists 3 EISMV, Dakar 14 months 3.5Animal Production 2 EISMV, Dakar 14 months 2.3

Total 26 61.3

Annex 3-3- 45 - Page 3 of 5

Research

The 400 m2 veterinary diagnostic and livestock researchlaboratory would be constructed in Bangui, where reasonably reliable publicutilities, good international communications and the possibility ofscientific interaction with other institutes would provide a favorableworking environment. The existing provincial laboratories in Bouar andBambari, which do not have those amenities, would network with the CentralLaboratory, limiting their work to sample preparation and work onparasitology, subjects in which reliable utilities are less crucial.Starting in PY2, the project would finance for two years an internationallyrecruited microbiologist, who would be the Director of the BanguiLaboratory. The internationally recruited expert would work with twoCentral African veterinarian counterparts in Bangui and one counterpart in.each of the provincial antennas. The project would further supply thenecessary laboratory equipment for the Bangui laboratory (Project File No.225.983).

The Bangui laboratory would also be equipped to test alternativecontrol methods against the tsetse fly. Significant progress has been madeover the last few years in developing small screens and traps which couldreduce the riverine tsetse species occuring in the southern and centralareas of the CAR without the bad environmental effects normally associatedvith tsetse control through aerial spraying of insecticides. To test thesemethods, the project would finance the international recruitment of aconsultant in tsetse control, to work for two months per year with aCentral African veterinarian already trained in the subject. The projectwould further supply one pickup and the laboratory equipment and wouldfinance the local production of 1,000 prototype screens and traps. Thesame local professional staff would be responsible for a detailed researchand monitoring program for a technical and economic evaluation of theeffect of tick control through the cattle dips on cattle production. Twoman-months of consultancy each year have been included in the project forthis subject.

Pasture agronomy research would concentrate on the furtherdevelopment of low-cost control methods against Laos grass and on thetesting of legume varieties to support the introduction of fodder banks inthe settlement areas. A local higher level technician backstopped by aconsultant for three months per year would therefore be recruited.Research materials, like seeds, herbicides, and fertilizers, would beprovided.

Pastoral Settlement

The creation of settlemert zones, with the much more difficultstep of introducing rational land use and adjudicating exclusive grazingrights to traditional producers, would be carried out by linking two ormore pastoral associations that have shown good social cohesion and soundfinancial management. The construction of a dip would be the crucialelement inducing the pastoralists to settle. The proposed beneficiaries

Annex 3-3- 46- Page 4 of 5

contribution of 102 of construction cos. is equivalent to one steer peraverage family and is assessed on the pastoralists' willingness to pay,determined by socia anthropological study (Project File No. 225.982). Thecalculated fee of CFAF 15 per head for insecticide and maintenance of thedips is already the accepted charge in ongoing dipping tanks. Alternativeconstruction designs for dips would be tested (Project File No.225.990(3)).

A typical settlement zone would consist of the area within aradius of 15 km around the dipping tank, which is the maximum walkingdistance for cattle to efficiently use such a dip. The corresponding areaof 70,UU3 ha could maintain a minimum of 14,000 head or 50-100 herderfamilies, or 1 to 5 herder associations. The direct project contributionwould consist of the access track to the dipping tank (average 10 km persettlement) and 90% of the construction costs of the dipping tank. Themobile training teams of FNEC would be responsible for the initialtechnical training of the herders; the Settlement Unit would organizefurther training in functional literacy. Through the revolving funds ofthe association, but not directly managed by the project, other activitieswould be started, such as the sale of drugs for humans and staple foodslike cassava flour.

Other project inputs for the settlement zones would be of ademonstrative character and would include in each zone the establishment ofup to three fodder banks, the control of up to 20 ha of Laos grass, and theintroduction of up to ) sets of animal traction equipment. The remainderof the construction costs of the dips and the materials for thesetechnologies would be financed from project funds, on the justification oftheir nilot nature and the wider social and macroeconomic importance to beattached to settlement. Also, to bring about a closer integration of thenomadic Fulanis into the national economy.

The implementation of the settlement would be entrusted to aspecial Unit in the Livestock Service, which as a Government agencv, wouldbe well equipped to adjudicate exclusive grazing rights and to guide andcontrol the introduction of improved grazing management. However, thesettlement zones would be created in the Livestock Communities with Fulanileaders as mayors. The Unit would therefore work through these mayors,relying on the stronger indigenous structures to enforce that grazingrights are respected by other groups. Satisfactory statutes for thesettlement areas were developed under WLP (Project File No. 225.989). TheSettlement Unit would, in addition to the internationally recruited expert,consist of three locally recruited zootechnicians based in Bossembele,Bouar and Bambari. They would be assisted by one higher level technicianper two settlement areas. The high level of staffing would be necessary tocontrol that grazing is adequately managed, and to monitor key parametersin the development of the settlement process. Four pickups, threemotorcycles, and three motorpumps to periodically renew the insecticidesolution in the cattle dips would also be supplied by the project.

- 47 - ~~~Annex 3-3Page 5 of 5

Spontaneous settlement occurs throughout the zone (Annex 3-3).Hovever, government projects and programs have generally not been able tospeed up or regulate this process in spite of considerable outlays of time,money and expertise. Land issues, in particular competition betweenherders and farmers, and lack of appreciation of the importance of croppingand of animal health problems have been major causes of failure. Thedesign of the proposed settlement accounts for these past experiences, asit would encourage settlement only in the so-called Livestock Communitieswhich in the CAR are uniquely recognized by all ethnic groups as belongingto the Fulanis. Furthermore, cropping by the herders would be encouragedand animal health facilities provided, thus enhancing the chance ofsuccessful settlement.

Livestock Development Fund

The Livestock Development Fund would consist of a simple localstructure with a supervisory comnmittee of MDR, Ministry of Plan,Statistics and Cooperation and Project and FNEC representatives. It wouldnot involve any additional staff. The Fund would finance: (i) the testingof promising technologies on a pilot scale, and (ii) early retirement andredundancy payments to LS staff retired under the Action Plan. It wouldreceive LS revenues and advance payments through the IDA and IFAD SpecialAccounts for expenditure incurred in pilot activities on the basis ofannual work program and budgets approved by IDA. The technologies to betested would include: (i) the control of up to 260 ha Laos grass or otherweeds; (ii) the establishment of up to 35 forage banks; (iii) thedistribution to herders of up to 90 animal traction sets; (iv) thedistribution of up to 3,000 screens or traps for tsetse control; (v) theestablishment of up to 8 small cheese-making installations; and (vi) theintroduction of a health package for up to 25,000 head of sheep and goats.

WAPAlJMarch 1986

- 48 - Annex 3-4

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

INFRASTRUCTURE COMPONENT

A total of 592 km of feeder roads, of which 85 km are in theBosser5ele region, 307 km in the Bouar/Bocaranga Region and 200 km In theBambar' region (Map IBRD 19233) would be rehabilitated. The rehabilitationwill be low-cost (US$2,200-US$3,600/km) and would reduce the platform to awidth of 3 meters. Details of each road are provided in the Project FileNo. 225.990(2)).

The rehabilitation would be contracted bv project management tointernational firms presentlv active in the CAR and expected to have anexcess capacity in 1987. Supervision would be sub-contracted toconsultancy firms in Bangui. The rehabilitation would be expected to startin PY2 with 192 km, continue in PY3 with 300 km, and be completed in PY4with the remaining 100 km.

Maintenance would be sub-contracted by the LS to the Rural WorksDerartment of MDR or, if the present promising results under the 4thHighway Project are confirmed, to small local contractors. Maintenancewould be financed from Government's contribution through the LivestockService Operational Account.

The main economic iustification would lie in the combined effectof (a) improved access to existing livestock markets and (b) an increasedavailability of consumer goods in the pastoral areas, which would generatethe cash reeds and thus induce pastoralists to increase their offtake. TheLivestock Communities, in which the roads are to be located, contain 352 ofCAR's cattle population or arproxinately 700,000 head. The expectedincrease in offtake from the present 8.5% to 9%, if the roads were to berehabilitated, would signify an incremental revenue of US$0.7 million peryear and, therefo-e, justifies the proposed rehabilitation.

WAPADMarch 1986

- 49 - Annex 3-5

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

PROJECT MONITORING

WLP's project monitoring unit consisting of a statistician and azootechnician, supplied by temporary data collectors as and when required;would be maintained under the project. A total of 8 man-months of outsideconsultancies, mostly in data collection and processing and in rural socio-logy, would be made available by the project. Because of the unreliabilityof data collection on migratory herds, where effects of certain inputs aremultiple (fertility, mortality, and production) and appear with aconsiderable time lag, a system of time-bound studies on specific topicsrather than a comprehensive data collection svstem is envisaged. Suchstudies, combining in-depth interviews of a small portion of the targetpopulation with larger data collection of a bigger sample covering only aspecific topic, have proven to be an effective tool in formulating andredirecting project strategies. The budget for the monitoring unit amountsto US$350,000 or 1.5% of the total project budget. Specific studies nowenvisaged, but to which other topics will be added are:

(a) Effectiveness of the Drug Distrlbution System. Drugavailability,prices, sources, and actual usage (dose,appropriateness of diagnosis) would be determined for the variousincome strata.

(b) LS - Producers Interaction. The frequency of contacts betweenlivestock agent and herders and the qualitv of the LS informationtransfer would be assessed.

(c) Herders Perception of their Organization and Settlement. Thisstudy, which would be part of the mid-term evaluation of thepastoral association and settlement component and would involve atrained sociologist, would attempt to assess the perception ofthe herders about FNEC, the herders association and thesettlement zones.

(d) Household Economic Studies in which recall studies on householdincome, nutrition and expenditure started under WLP would berepeated every two years to determine trends of the variouswealth strata.

(e) Pastoral Settlement. In a limited number of settlement zones, amore comprehensive monitoring system would be introduced. Such adata collection system would cover approximately 20 herds andherder families and cover the topics mentioned above, plus thedegree to which grazing management plans are followed by theherders and the impact on range composition. The Monitoring Unitwould be assisted by the Pastoral Setclement Unit in this portionof their tasks.

WAPADMarch 1986

Annex 3-6-50- Page I of 4

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

INSTITUTIONAL REFORM AND ACTION PLAN

Institutional Reform

The Action Plan for institutional reform would over a five-yearperiod: (a) correct the present imbalance between salary and non-salaryexpenditures in the LS by instituting a system of direct revenues and byreducing the total salary bill; (b) promote staff motivation by modifyingthe existing bonus system so that it relates more closely to individualperformance and by improving supervision; and (c) reduce the number ofhierarchical levels in the LS.

(a) Salary and Non-Salary Ratio

The LS revenues to cover after project completion its operatingexpenditures would be derived from the Market and Trypanocide Tax (whichcurrently are levied by FNEC) and the vaccination fee. These revenueswould be progressively transferred to LS, who starting at the beginning ofPY3 would have full responsibilities for their collection. To avoideventual cash flow problems for FNEC in the first two years of the project,FNEC would still receive a 50% and 30% of the taxes in PYI and PY2respectively. Present recovery rates of the Market and Trypanocide Tax areextremely low because of poor control. The Directorate General wouldtherefore be expanded with one accountant and five assistant accountants toimprove control and to increase the recovery rate from 15% to 50% atproject completion. Compliance with a progressive increase in recoveryrate would form part of the Action Plan.

Staff Reduction. Future staff requirements in PY5 are provided inthe table below.

Staff Requirements(PY5)

Directorate General 35Regional Inspectorates 256Bouar College 20Pastoral Settlement Unit 17Research Service 56Non-project Activities 86

Total 470rn=

- 51 -Annex 3-6Page 2 of 4

Estimated actual staff numbers and requirements in PY5 per staff categoryare given in the following table.

Estimated Actual Reg.Staff ExcessStaff in LS PY5 (Deficit)

Veterinarians & Zootechnicians 19 24 (5)I.T.A. a/ & Higher Technicians 27 46 (19)Livestock Agents 267 222 45Vet.Nurses & Highe- QualifiedSupport 36 8 28

Support Staff 403 170 233

Total 752 470 282

a! "Ingenieurs des Travaux Agricoles"

All LS staff would be tested and evaluated during the first year. Thefirst year a staff reduction of 52, the second year of 70 and the thirdyear 160 posts is envisaged. By the second year only the number ofrequired staff would be retained. Excess staff would be administrativelytransferred to a pool and would have preference should new vacancies becomeavailable and would be subject to redundancy payments from the LivestockDevelopment Fund. A level of two years extra salary payment if theemployee has served at least five years and a 5% of annual salary for eachyear extra and 5% reduction of annual salary for each year served less thanfive years was agreed upon during negotiations. The implementation of thisplar. would form part of the Action Plan.

(b) Personnel Administration at the LS

The personnel administration at the LS would be improved byinstituting direct salary payments, and by establishing a regular staffevaluation system and modifying the bonus system. The proposed directsalary payment by LS was already foreseen in the ILP Credit Agreement, butnever enforced because of lack of personnel. The present bonus system forlocal staff in externally funded projects tends to cover all staff and has,therefore, become an acquired right completely divorced from the improvedperformance it is supposed to stimulate. Under the project, enly 70% ofeach category would receive a bonus and the amount would be decided on thebasis of objective criteria, such as an annual evaluation by the immediatesupervisor/chief of the Extension Unit and by the corresponding RegionalDirector, an independent comment of the FNEC representative or the pastoralagent in that district, and the results at the refresher course at BouarCollege. The Director General and the co-director of the project would be

- 52 - Annex 3-6

Page 3 of 4

responsible to further develop and implement this system. Tentativemonthly bonus levels discussed during negotiations were: Director GeneralCFAIF 100,000, Unit Chief CFAF 60,000; Sector Chief CFAF 30,000 andLivestock Agent CFAF 10,000. Government will further consult on this issuewith the management of other projects and promulgate a system acceptable toIDA as condition of Credit effectiveness.

(c) Number of Hierarchical Levels

To reduce the heavy bureaucracy and enhance the information flowbetween the field level and the Directorate General of LS, the fiveinspectorates and 45 subsectors would be eliminated, and the number ofposts reduced from the present 183 to 110.

Present Projected

Directorate General 1 1Regional Directorate 1 2Provincial Inspectorates 5 -Sectors 15 15Subsectors 45 _Livestock Posts 183 110

ACTION PLAN

The following key administrative, financial and organizationalactions would be carried out under the Action Plan.

1. Creation of Direct Revenue System for LS:

Government would furnish the following amounts to the LivestockDevelopment Fund affecting progressively the Market and Trypanocide taxes.as follows:

(a) Year 1: 50% of taxes with a minimum of CFAF 40 million(b) Year 2: 70% of taxes with a minimum of CFAF 70 million(c) Year 3: 100% of taxes with a minimum of CFAF 120 million(d) Year 4: IOOZ of taxes with a minimum of CFAF 160 million(e) Year 5 and

following Years: 100% of taxes with a mimfium of CFAF 220 million

2. Staff Reduction. Government would reduce the total staff of theLivestock Service to the following levels:

(a) 700 at the end of the first year of the project.(b) 630 at the end of the second year of the project.(c) 470 at the end of the third year of the project.

- 53 -

-53 - Annex3-6Page 4 of 4

3. Reorganization. At the end of the second year of the project,Government would have:

(a) transferred the responsibility for the col4 lection of the Marketand Trypanocide taxes to LS.

(b) Reduced the number of inspectorates from five to two, eliminated45 subsectors, and reduced the number of livestock posts from 180to 110.

4. Government's performance will be assessed at the end of each ofthree tranches of the LS operating costs, and disbursement of theconsecutive tranche would only commence if goverrment has met the ActionPlan objectives.

WAPADMarch 1986

CENTRAL AFRICAN REPUBLICNATIONAL LIVESTOCK PROJECT

Prolect Llnkages wffh Laestock Servce and FNEC

| Minwstr dof

Machet9ry Ceo Gad BAn*/d

TW 1~~~~~~~~~~~~~~~~~~~~~~1

DIr C-AWt

FlnoncklConbolr

; ~ ~~~ Ad|Wto Adminlifratbon|& Lloc & Flnancel

WAPADMarch i986 Wornd bank-2768

CENTRAL AFRICAN REPUBLICNATIONAL LIVESTOCK PROJECT

FNEC:'s Prooosed O=qnlzaffon Chgd_EE9FNEC

r" dd

SecrtauyGerwd I

CoordklifoCornlftee

U.... -___J

& finance &Ti

D~sic Agents DWIIC Depots

CC

MMd Bor*-27669

WAPADMarch 1986

CENTRAL AFRICAN REPUBLICNATIONAL LIVESTOCK PROJECT

Livestock SerMce's Proposed OraanizatIon Chart

Mlnistet of

I~o Dea pmnt I

Sectgoray Geneol

MOile=lrrg E n Iractio

Lei

Aouor Labortory Bombot Lo

l_______________________ lns tion West lns lto East

Suctoii

Pcsts Psts

WAPAD jMarch 1986 V Bn-27667 0

- 57 -

Annex 3-10Page 1 of 2

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

TECHNICAL ASSISTANCE

The following technical assistance would be provided under theproject:

Long-term Consultants

Expert Financing Volunteers(MY) Agencies (MY)

Project Management

Project Co-Director 4 IDA/IFADFinancial Controller 5 rDA/IFAD -Project Workshor 4

PNEC

Pastoral Organization 4 FAC 16

Livestock Service

Extension 3 IDA/IFAD -Training 3 FAC 4Research 2 IDA/IFADPastoral Settlement 4 EDF

PPF a/ 3 IDATotal 28 24

a/ The 3 man-years provided under PPF funding are for the projectcoordinator, FNEC's financial controller, and the experts inpastoral organization and pastoral settlement.

- 58 -

Annex 3-10Page 2 of 2

Short-term Consultants

Expertise Man-months

Extension (Trvpano and small stock) 10Research (Tsetse and tick control) 14Forage Agronomy 9Planning of the Veterinary Research Lab. 1Sociology (Pastoral Settlement) 5Small-scale Cheese-making 4Project Monitoring 8Training and Pastoral Settlement a/ 3

a! The training expert (2 man-months) and the pastoral settlement e:,pert(1 man-month) would return for a short follow up mission after their

long-term assignment has been completed.

Close cooperation with international institutes with specificexpertise would be sought in the recruitment of these consultants. Thusthe French Tropical Livestock and Veterinary Tnstitute ("Institut d'Elevageet Medecine Veterinaire des Pays Tropicaux" - IEMVT) would provideconsultants in the areas of smallstock, trypanotolerance and tsetsecontrol; the Food and Agriculture Organization (FAO) would provide specificexpertise in tick control; and the International Livestock Center forAfrica (ILCA) would provide backstopping in forage agronomy.

WAPADMarch 1986

- 59 - Annex 3-11

CENTRAL IRICAN REPUBUCNATIONAL LIVESTOCK PROJECT

lmptementfton Schedule -

1686 1Q67 4968 99 1 990 199 1992

At MC J UN JU IDEC JUNJAN JN AXLIDEC JAN JUN I A |EC JN|JAN J JUL IDEC JAN JUN| JUL IDEC JAN JUNI JLDEC TJAN .lT

PROJECI PRESARADN F1C1

RiEC

TA *WAOum./sw ,. a a a aa

trut"kion Woo Cornputa

CorWnuctn P f a (9) _(1)MO T.mru OeaIng _ (1) (4) (4) (4) (4) _() l4)

WAe F_maA= (1)__ 8_O _ 481 48 48 (6)

Trauma ( _ (AO) _ _ 12) _ _ (-1 j00 I I _ 1200(_ _ (1

TAT,FSOOI R I _ _nI Ii ec cI IITA La -_ - - - - 1* 1 1 - I

TA frLdbar I I I IIv TA kor n SI.c I I I I _ U

I *xT*w of d S atli f Zones _ I2) (3) (5) 5 (3) I I

o Zo,I- I I I. I I 4 W I I IIEa~r Zae ' 8rn1

PROJEM L TA PO.Ct Cadmcto - - --x- - -

0ficMCWA%10 Urwrnjd&t -

Pmp2ar.on FdbilotgwTp

R.dLtaion in An LoIC LS | -_700 I 3CI 470 I 4)0 1 47C

| DiaR eve Wm enerama CFAF 40m CFAF 70m CFAF 1F ACFA 0 I CFAF 220m

DobmorWl LS cab LS S 7L USS 0 _4mt _ _ _ Ž t|1 _ b_=[:lln*ig .tal. colplmflsDumei1Is of c esporwdng honche LS Cmmo nr Csts wOUld be We dlffvlnlg lof twlg

Wo &mu . 3Y r

WADMm:h 196

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

PROJECT COST StMfARY

(FCFA Million) (US$ '000) Z Total- - - - ---------------- Z Foreisn lase

Local Foreign Total Local Foreign Total Exchmnge Costs,2=_,_ ===m ======== Z=z=Z : Zzz :-- =: ==-=Z ::_ ::=

A. NATIONAL CENTRAL AFRICAN HERDERS FEDERATION C FNEC

ADMINISTRATION AND FINANCE 201 252 453 522 655 1,177 56 4INPUT DISTRIBUTION 570 1,799 2'369 1,481 4,673 6,154 76 21FASTCRAL ORGANIZATION AND TRAINING 323 320 643 83? 830 1,&69 50 6

Sub-TotWI NATIONAL CENYRAL AFRICAN HERDERS FEDERATION I FNEC ) 1,094 2,371 3.465 2,842 6,159 99001 68 31f. LIVESTOCK SERVICES

[.(TENSION . VACCINATION AND STAFF TRAINING 2,199 1.0/7 3,275 50711 2,797 8,507 33 29RE;EFACH 465 388 853 1,208 1,007 2,215 45 8FASlORAL SETTLEAENT 511 451 962 19326 1.173 24499 47 8

:.T0CK DEUELOPIENT FUNDI 105 375 479 271 973 1,244 78 4

Sub-Toteal LIVESTOCK SERVICES 31279 2,290 59569 8,516 5,949 14.465 41 49 C. INFRASTRUCTURE

FEEDER ROAD REHABILITATION AND MAINTENANCE 546 496 1,042 1,418 1,288 29706 48 9

Sub Totil INFRASTRUCTURE 546 496 1,042 1,418 1,288 2.706 48 9D. PROJECT DIRECTORATE

DIRE'TI JN 285 388 673 742 1,008 19749 58 6CoNITORING AND EVALUATION 81 72 153 209 187 396 47 1VEIHICL7S ANP EWUIPP,ENT 109 146 255 284 379 663 57 2PROJECT PREPARATION 5Y 123 182 153 318 472 68 2

Sub-Total PROJECT DIRECTORATE 534 728 1,263 1,388 1,892 3,280 58 11

Total BASELINE COSTS 5,453 5,986 ;11339 14t;U 15,288 29.452 52 100Phssical Contingencies 215 494 709 558 1,282 1840 70 6 C lPrice Contingenries 1,161 1,154 2,316 3,016 2,998 69014 50 20 1_

Total PROJECT COSTS 6.829 7.534 14W363 17,738 19.568 37,306 52 127_-r:_-: :- ::_:_: :===s:=z ===:-==: XXXs2-_ ====-x-__s _=s=s_

WAPADMarch 1986

- 61 -CMI=AL AIUICAN RrFUILIC n 3-12

NATIONAL LIVESTOCK PPDIECT Pags 2 =o 3

PRDJECT COSTS BY COST CATROR(FCF4 Nlllam.) cmS leot

- ~~- K Fouls Do.Local Forelgn Total Local Foen Ttal Eachum Cot.

1. INUBNI MSTss

A. CIVIL OmS

FEEIE R NS 563 391 954 1.413 101S 2,47 41 BDuIIIIIMS 379 223 603 996 SN 1.565 3 5CATTLE DIPS 232 137 369 603 m55 95 37 3

Sub-Total CIVIL MIS 1.175 751 1.926 3PO!2 1D 5.0M 39 173. YENIMES NM E PINEIT

IIICES 201 672 9n SU 1,747 2.268 n 7EUI?llENT 16 52 As 41 136 176 77 1

9*Total VEHICLES NO EIIEWIT 216 725 941 562 1.2 2d445 77 BC. TEONUL ffSISTUE I 13D13

1. TECIltC *15ST1IICE

EIFW 296 959 1246 744 2.491 3s235 7 11CUtlLIIT 69 231 300 179 59 773 77 3PROGRESS UINITEER 62 52 114 161 135 m 46 1

Sub-lot TEOtUCAL SAUSITU5 417 19242 1,U69 1.IB4 3.225 WM 75 152. TR*NIN

T1I3N*1 76 255 331 19 Mt on 77 3

Sib-ToaLl TIRNIN 76 255 ;31 191 "I IN 77 3

SbTotl SCNI. ASSIMA ICES TR1011 493 1,496 1.990 1.21 3 116 5 lU 75 13. VATERI.LS

VUIHIRr AM LABRTORY 11TBUELS 5 36 41 12 93 1 05 0OMRPATEItIULS 32 106 139 B2 276 33 77 1

gb-Total IATEIRILS 36 142 178 95 369 463 s 2E. UDITIEG Me SINT

RE3EWam MD UITImNS 10 35 5 27 91 l13 77 eSTUDY 46 152 19 119 36 n 14 77 2

SiTotal ITINI c STIJI 56 187 24 145 4n7 632 77 2

Toal IWIESTHET CIETS 19W 3.301 5.278 5.136 1.573 13.709 a 47

11. 1E1911 COSTS

A. Pnm L

FIResUIIE 20409 - 2.409 6256 - 6256 - 21DIU 378 - 37E 982 - 992 - I

Sub-Toal PIIMIIE 2.797 - 2.737 7.239 - 79239 - 253. W1TIl COSTS

NNIITUIIIEM OF MES 161 395 55 419 1.025 19444 71 5IATEmIAS 122 4U Y9 332 .l1B 1.5310 73 5USEWll UOIWLDIIIIS 24 14 37 6 36 97 37 0

N EI9WCE OF C*TILE IVS 0 0 0 0 0 1 37 0MUM LZMiI 211 - 211 543 - 54s - 2DM1 97 1.55l 1.641 25S 4.6 4.279 94 15IWTEWTICE OF FEE _M 60 15P 219 156 413 569 73 2IIIEIS 9 6 14 19 .6 36 46 0

9-Total WTII CDSTS 63 2 ! 3.274 NM 190 6h715 1504 79 29

Total 1 hr 3ITS 3.476 2.585 6S061 9.02 6715 15743 43 D2Total SVELTE tS 5.453 5.196 11.339 14.164 15.2B 29.452 52 160

"mical cotine cioo 215 494 70 1 1.212 1.30 70 6Prin ComtUSmios 1.141 1.154 2.316 3e016 2.990 6.14 50 2e

Tol "AT C1T 6.829 7,534 149343 17073t 19t518 37.306 52 127

WAPADMarch 1986

- 62 - Annex 3-12

Page 3 of 3

Project Costs in the National Economy

Investment Costs. The total investment cost of the projectamounts to US$17.4 million; the remaining US$19.9 million concernsincremental and non-incremental operating costs of the National LivestockProject. This level of investment amounts to approximately 10% of thetotal proposed investment program in rural development for 1986-90. It istherefore 'n line with the 12% share of livestock producers in the ruralpopulation but below the 30% contribution of livestock to the agriculturalGCP. It also follows the historical rattern as shown below.

Share of Livestock Investments in Rural Development Investment Program(US$ million)

Actual Planned1980-1982 1983-1985 1986-1991

Rural Development 44.0 79.8 197.2Livestock, 6.1 7.2 18.9of which, IDA co-financed projects 3.5 5.0 17.4

Other projects 2.6 2.2 1.5Livestock Investment as percentageof Rural Development Investment (Z) 14.0 9.0 10.0

Operating Costs. Since FNEC would continue to be self-financing,its operating costs would not be a burden on the Government budget. TheLivestock Service would be partly self-financing. The total burden to theTreasury, including road maintenance, woulc only increase with inflation(at 8% p.a.) from the current US$1.4 million to US$2.0 million afterproject completion. This means that Government's contribution (includingadequate funds for road maintenance) to LS would remain at 30% of MDR'stotal recurrent budget. Furthermore, through the institutional reformplan, the impact of these funds would be enhanced, as the non-salaryoperating funds available to the Service would increase from the presentnegligible US$4,000 to a reasonable US$570,000 per year (Annex 4-17).

WAPADMarch 1986

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

FINANCING PLAN BY PROJECT COMPONENT(UB$ '000)

IDA IFAD EDF FAC FKC PRONJEMRS GOYERIIENI Total Local-.... ..... .. _ . ---- -IExl. IAits I

Aount Amnt 2 Aomt 2 Aount 2 Aount 2 Amnt 2 Amont I Amut 2 For. Exh. Taxes) TaxnS:=:::= ::= a:===-: a::u.n nu - was::: a: :::::. :ss wawss =s. 3555 Z.a 5 5 SEEN =3 :5= Z a - -

A. IATIftA CENTRAL AFRICAY OERIS FELERATINI FREC

ADMINISTRATION AND FINANCE 716 49 239 16 -- -- 510 35 - - 0 0 145 4 919 574 72INPUT DISTRIBUTION - - -1 771 22 -- 6,359 77 971 0 0 9.227 22 6274 1,385 568PASTORAL ORGMAIZATION MM TRAININS 1,117 54 380 19 - - 549 26 - - 34 2 0 0 2.093 6 11036 911 136

Sub-Total NATIONAL CENRAL AFRICAN IERKRS FEKRATION F(IEC 1,834 16 617 5 11771 15 549 5 6,969 58 132 1 0 0 11,774 32 Si 129 2,970 776So LIVESTOCK SERVICES

EXTENSION , VACCINATION MID STAFF TRAINING 31749 36 1,239 12 - - 51 5 - - - - 4.970 47 20,373 29 3o431 6i092 843RESERACH 1.t584 58 529 19 - - - - - - - - 622 23 2,734 7 1.249 1,223 264PASTORAL SEITEIrIT - - - 2w99 7 -- -- 131 4 307 9 3.327 9 1.554 .2m 551LIVESTOCK KEVELlPIIENT FUND 279 19 93 6 - - - - - - - - 14067 74 1,439 4 1.124 16 129

Sb-Total LIVESTOCK SERVICES 5.611 31 1960 10 2,999 16 516 3 - - 131 1 6,966 38 17B74 4B 73U4 89723 1.797C. INFRASTRUCTURE

FEEDER ROAD REMIILITATION AND MAINTENMAICE 14543 43 514 14 723 20 - - - - - - 816 23 3,596 10 19717 1.555 324

Sub-Total INFRASTRUCTUE 1.543 43 514 14 723 20 - - - - - - 916 23 3,596 10 1.717 1.555 324D. PROJECT DIRECTORATE

DIRECTION 19572 69 524 23 - - - - - - - - 167 7 2.263 6 1.324 919 121MONITORING AND EVYLUALTION 297 59 96 19 - - - - - - - - 11123 495 1 236 229 30VEHICLES AND EGUIPENT 625 75 209 25 -- -- -- -- 0 0 834 2 482 274 77 PROJECT PREPARATION 4659 - - - - - - - - - - 6 1 472 1 318 147 6 N

Sub-Total PROJECT DIRECTORATE 2.950 73 829 20 - - - - - - - - 295 7 4063 11 24360 1,469 234

Total Disburseunt 11,938 32 3.921 10 5.382 14 1066 3 6869 It1 263 1 7.967 21 37306 100 19568 14,617 3,121ua::a:: ans augurs *=n nuns zns mania ans susan int uasns :su susn r:: sans y= ufnas s----- mn

WAPADMarch 1986

- 64 - Annax 3-14

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

PROJECT AND SPECIAL ACCOUNTS

The internationally recruited financial controller would beresponsible for the control and maintenance of the project accounts,records and documentation pertaining to financial transactions, inaccordance with generally accepted international accounting procedures.He would ensure that FNEC prepares an annual financial statement whichincludes a balance sheet, income statement, and sources-and-uses-of-fundsstatement. He would also ensure that the Livestock Service prepares anannual budget and sources- and-uses-of-funds statement which would be anintegral part of the Action Plan. The FNEC and LS accounts including theProject Special Account, the LS salary account and the LivestockDevelopment Fund would be audited annuallv by independent auditors ofinternational repute acceptable to IDA, whose reports would be forwarded toIDA and the cofinanciers within six months of the end of the financialyear. The rerorts would be prepared according to Bank Guidclines forfinancial reporting and auditing of projects. They would also include anopinion statement as to whether or not IDA funds had been used for theirintended puipose.

The Secretarv General of FNEC and the Director General LS,assisted by the project co-director would be resronsible for the submissionof quarterly progress reports to Government, IDA and all cofinanciers,showing actual and budgeted expenditures, statements of physical progressachieved and objectives for the forthcoming period by project component.

Special Accounts

LS would open two accounts (condition of Credit effectiveness):one for salaries and the other for the Livestock Development Fund. Theaccounts would be opened in local currency at the BCAD (Banque de CreditAgricole et de D6veloppement). Thev would be expected to be maintainedafter project comrletion to continue to finance LS orerations. Startingend-June 1987, Government would each month, at least 5 days after the endof that month, deposit adequate funds in the salary account for LS staffsalaries.

The revenues from the Trvpanocide tax and the Market tax,previously collected by the FNEC tax collectors and the sector andlivestock agents respectively would be solelv collected by the latterstarting at the beginning of PY3 and would be deposited in the LivestockDevelopment Fund. Withdrawal from this account would require theauthorized signatures of both the project co-director and the DirectorGeneral of the Livestock Service.

WAPADMarch 1986

CEMIRAL AFRICAN REPUBLIC___,__ ......................... _

NATIONAL LIVESTOCK PROJ ECT

ESTIHATUD SCHNDUIL OF CREDIT DISBURSEMENT

(USSOOO)

IDA FY Disbursement Csumlative Region-wideand Semester by seuester Disbursement Profile (%)

1987 II 614 614 11988 I 456 1,070 5 l0

II 798 1,868 12

1989 I 1,026 2,894 21II 1,026 3,920 30

1990 I 1,254 5,174 41

II 1,254 6,428 52 ' Poe , eg U'

1991 I 1,254 7,682 63 Ar ea P f

II 1,140 8,822 73 a5 Profile Development1992 I 912 9,734 81 cn 4,

II 798 10,532 88 3-

1993 I 684 11,216 94II 456 11,672 98

1994 I 228 11,900 100 I

0- -- - -- X . r -

led? il I Il logo lii lol 1;i3 1;14

IDA Fiscal Years

Note. IDA Western Africa Region profile fcr agriculturalarea development projects; Harch 1984.

Fiscal Year: January 1 - December 31.

Project Year: July 1 - June 30. N

Negotiation Date: March 1986.Target date: Effectiveness October 1986. ,

WAPADMarch 1986

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

HERD PROJECTIONS

(USS '000)

Yer I Yew 2 Year 3 YrN 4 Yw S Year 6 YNr 7 Yw Yewr! I SYw 16 Ye 13 Yw 12 Yer 3 Yew 14 Yew 35 Ya. 16 YW 17 Yw I6 few 19 YwUas

Nord Camsition VMI)

Fils

Calve 2M. M 23.3 L 195.K MK 197.0 2MK 254.3 21 5 . 207K0 2M7K M9K 21 K 21L3 213.0 235. 213.. 21L . 219.0 223 22LWIHiYen 1-2 yr 145.51111 144 , 345.1 14.1 155.11 I53.3 135. 31.3 14, 16% 16I6K 167.0 1666.0 169 171.K 37 17I3. 174.0 175. 171.Hi3fm 2-3 yr 133. 1313. 131.0 336K 3K 13 3.3 141.0 144.U 149.K M 154K0 154. 5 IS.N 15.3 157 K1 139K" 1366 1613. 162.K 164.K 105.55H3ifa 3-4 r 125. 124.K UL. 326.U 131.K 133.1K 13U. 13N 143K 3413 1346 149.K 15.K 35.K I52K" 15LK 157.3 ISL. ISL. 157.0Cows 75L3 74L.5 727.0 7856 712.3 715. 754.3 757.5 1133. 714.0 7233 721.3 73L. 73K 746.3 745.3 75UL 7U. 76L. 75111bal

Calve 2U5U 23.3 I9.K 19.3 197.3 216.3 24.3 59. M1.* 257.3 2.54 235.5 23. 213.55 2M. 21L3 23IL3 239.3 225. 22nm 1-2yr 125.K ILK 1o.3" 1413. 342.3 14H IS." IS3. IS3K 157.3 157.0 3591. 166.0 1613. 162. 36L.3 164.3 165.3 166. 16L3

Hear 2-3 yr 33L. 33L. 121323. 126.0 32. 131.N 134.0 1335. 143.3 143.3 34 1345 3" 147.3 47.3 13463 149. IS3N 151.3 IS IS 3 53.3#Sinr. 3-4 yr sUs 97.3 L.K 13.M 3 MN 114 16l 11L3 12ML3 124.3 12LZ 123. S 32 13L 13 3 33 131.11 33. I33. 134.3 135.0 136.N 137.3

Urn 4-5 yr 75.3 62. 6 55.3 t .K 9 9 7. 3 S. . 13.3 3 2.3 366.3 33.311 5. IL 133.3 333.3 3323 332. 113.0 3 114.0 I3lS 316ars 5-4 yr 5S3 45te 49.*S.t 3 47.311t 49.3 11.55 533 5t.K1 52.3 l 5 3.3 1L3 s5. sat U.K 5K 56.3 5sa 57.31111t 57.tt 57.31

Ste 6-7 yr 3t.3te aK 25.31111 8.K tte E 24.t 25.3 273 26.n 26N 25l 26.3 27. 27.3t V. .3 t 5.3 e IL" tt 55 2S5 5SRt 7- yr IL5. I1.3t IL.3 34.3 15. L IM i2 l1I 133 33 53 37.t 17.1 17.3 37.3 ILttt ItlI t L6 t13 3IL3 3L" I3Lt

Total 21t5. 2S0.0 2594.3 237.3 2179.3 23E66. 214.30 2375.3 265.3 2224.3 2243. 225.3 2275.0 22911.3 26L5 2321.3 27. 2313. 236tS3 23tl4.311

FertilIty 4tr 111 .53 t. S 6.54 L54 6. 5 6.56 6.57 5.56 6.56 t6. 6.56 6.5 1 1.5 l 5.1 5.15 6 .5 5 L5B 5.3 ILM tt- tLS

etality Rate 353

rl.~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~a

Calvns 6.21 1.26 5.24 1.23 L.22 L.21 6.21 6.21 L21 5.21 5.21 6.2a L.21 L21 1.21 L.21 L.3 5.21 L.21 L.25Hafes I-2 6.16 Lt9 1.t Li?67 6.5t6 6.tt6 Ul 1.56 ttl6 L.tl 556 5 L6 5.t6 K . l LK Lt6 Lt tt6 L 6 Ltt6Wifwe2M LO t 5l ttl4 L.t4 tlt4 5.54 L.54 6.44 L4 LIN L.6l4 L.54 6tt4 L.t4 tlt4 Ul54 6.54 t tl4 tt L4 Lt4

Calv L.32 .A3 L.2 5.27 L26 tt25 1.24 6.24 1.24 1.24 1.24 5.24 L.24 6.24 0.24 5.24 L.24 6.24 6.24 L241ull 3/Stnrs 1-2 yr 5.32 5.33 5.35 S.59 L.K L.K 6.3 L.3 L. L L.3L6.3 LtM 5.3 5.K LO3 5.K LK LOB LosUuils.ites 2-3 yr 6.1 L.6 *5tt *(6 LO S 5 * .(5 L.59 L *.t6 6. S .t5 9 .0 L6. 5 6.5L 5.t5 t5. t 5t t .t5 t5t LE59BIlls3Ster, 3-4 yr 6.65 L.Ot 5.t5 L.15 L.59 5.t5 5.(5 L5. 5.5 5.O9 L5.5 L5.5 L5. tt6 A.t6 L5.5 5.59 L5.5 L5.5 Lt5thlus/lt on 4 yr 5.59 6.5 L5.5 *.t5 .596 L.5 6.59 6.59 t5 L5 s .a5 L.I 5.c 5.05 t.a L5 65 .a LO59 Lt5.

Dhth '66) m2.2 225.3 39.65 167.3 362.3 161.3 36L5 3." 11164.31 l36. 36. 36L3 389.3 319.3 I3 313.0 194.6 39L3 397.3 39.3

kils '363 17. 362.30 1163. 154.3 395.0 193.0 396.3 265 212.3 2134. 215.3 225.3 222.3 223.3 25. 621. 22 6.3 69.3 231.3 233.

Offtaka L5. L. 9.0 9.0 9 .3 9.21 9.21 9.21 9.65 9.66 9.75 9.75 9.3111 9.3 9. 9.3 93 9.3 9-. 9.3

Offakie * Imerautal L5S L51 L4 9.35 9.3 9.3 9.96 9.91 3L.66 35.35 16.35 1L.21 35.21 16.21 I326 3L.21 I2 16.25 136.21 5.3

- 1rcrotal Lti*lt 5.3 26LIM3 46130 46135.3 s553.3 6159.3 n 9M.3 3432.3 1563.3 17367.3 19464.3 2S665 22431.1123664.t5 L63265M7.3 27s2n 2a776.3 312.0 31e76

Productt Iornmee

- l3r ntal Milk L. 3I33.3 2464.0 563. 5996.3 9547.3 3134.3 14254.0353L.336.1702.0 I3 2.3 I34. 19964.e 21 .32395 2 2172. 234.4 24794.0 2571L5

Produtlion ITo,)

WAPADMarch 1986

Annex 3-17

- 67-- Page 1 of 6

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

FINANCIAL RESULTS

Producers. The producers benefits were analyzed for threedifferent production units with an average herd size of 120 head. Themodels are (i) without project; (ii) with adoption of a full animal healthpackage, except for the major investment in a dip; and (iii) with adoptionof full animal health package, including a dip, and the establishment of afodder bank. The third unit Is presented onlv for comparative purposessince the project would only introduce the use of fodder banks on a pilotscale. The underlying technical and financial assumptions are in ProjectFile No. 225.990(5).

The strong economical incentive for the producers to adopt theproposed health package would justifify its general dissemination. Thepreliminary estimate of the financial rate of return of the whole package,although yielding lower returns than the animal health improvements only,at 34% fully justifies further testing. Moreover, this package most likelywill generate additional benefits in revenues from labor, which would bereleased from manual deticking with the dips, and from increased cropyields from improved soil fertility because of the fodder banks.

Livestock Service Cash Flow. The Livestock Service cash flowbenefits from increased revenues, taxes and vaccinations fees. The agreedupon Action Plan proposes a staff reduction of 280 posts over the firstthree vears of project execution. An average severance payment equal totwo years of salarv for regular staff (US$3,500) and 6 months for de factopermanent support staff (US$350) are included for each staff. This wouldresult at the end of PY3 in a salary saving of US$360,000 (CFAF 144million) in 1985 prices. However, a progressive filling of higher levelpost through promotion within the LS in the last three vears of the projectwould cost USS200,000 (CFAF 80 million), resulting in a net saving ofUS$160,000 (CFAF 64 million). With the applicable inflation rate of 8% thetotal salary bill would have increased from the present CFAF 550 million toCFAF 750 million at the end of PY5 (project completion). Under the ActionPlan, the salary bill would stand at CFAF 600 million and Government'scontribution to the rehabilitated livestock feeder roads at CFAF 150million. Thus, Government's contribution would not have to be increasedbeyond the increases due to inflation. Furthermore, the Action Plan wouldcause a direct revenue of the LS for non-salary operating costs of CFAF 220million (US$570,000), thus giving the LS the appropriate means to operateefficiently. Road maintenance could be expected to start in PY2 and iscalculated on assumptions in the Project File No. 225.990(2).

FNEC Income Statement and Cash Flow. An analvsis of ANEC' pastand projected cash flow shows that the transfer of the revenues from the

- 68 - Annex 3-17Page 2of 6

Market and Trypanocide taxes from FNEC to the LS, and the proposedretention of 30X of the membership fee by the herders association would notaffect ANEC's financial viabilitv. It further shows FNEC would be able toassume full responsibility for its Pastoral Organization Department in PY5and, if salarv pavments of the district agents would be taken over by theDistrict federations as foreseen, that FNEC could assume responsibility fortechnical extension as part of the long-term strategy.

WAPADMarch 1986

CENIA AFRICIA REUEIC

NATKNAL Lr*n PFA

PKMUER CAS FU(CRAP '0000COtant Pricem)

CASE 1: HEI PACM (LY

YR YR YR YR YR YR YR YR YR YR YR YR YR YR YR YR YR YR YR YR1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

A. Cush Flow1. S

meat 1021 1055 1041 1047 1049 1074 1174 1218 1311 1353 1395 1436 1478 1514 1552 158; 1624 1661 1700 1739mllk 56 57 60 62 63 67 69 70 72 74 75 77 79 81 82 84 86 88 90 92

Subt Cash Inflow 1077 1112 1101 1109 1112 1141 1243 1288 1383 1426 1470 1513 1556 1594 1634 1672 1710 1750 1790 1831

B. Cash Gutflw1. Cqpltal exp. so

2. Oper. Es.deworuuiz 3 3 3 3 3 3 3 3 3 3 3 4 4 4 4 4 4 4 4vwec1iat1on 4 4 4 4 4 4 5 5 5 5 5 5 5 5 5 6 6 6 6

innctiel 36 37 37 38 39 41 42 43 45 46 47 48 49 50 51 53 54 55 56trypaioclde 14 15 15 15 16 16 17 17 18 18 19 19 20 20 21 21 22 22 23terrLamci 28 28 29 29 30 31 32 33 34 35 36 37 38 38 39 40 41 42 43

Subt Cbi Outflow 85 86 88 90 92 96 99 102 105 107 110 113 115 118 121 123 126 129 132

3. CASH LNACE 1077 1026 1015 1021 1022 1049 1147 1189 1781 1321 1363 1403 1444 1479 1516 1551 1587 1623 1661 1699

Iwch 1906

0I'

1i -4

-70- M 3-17

COrIVAL AMqW_RRS"~rag A f

Cnna LeNs C

' w0 s We t llis se

1112 or FIRe as - less ton u.aS

I AsisAN 0AL 0 i

mmn ai .CATTLE 10.0 10.0 2.7 ILl 5mIC 0..

,TALL ,AnS 12.1 06.9 21.. 111.1

cmIJ2C Tlm 51 .1 11.0siemm 12.5 i.e dl

49.4 12.9 di TUlL smallt 0.0 A1. 14.2 11.7T a le elS

TWllWoCCot 2.e 17.4 17.1 221 -

CATTZISNl 29.1 10.1 11.0 -

- n.. i.. 03.- '1.e S/TOTNL TS MO S 9e1. *9.. .5.s am..CAST O2 FM PUTnI M1O1 0.5 90.0 1.0 s.8

tTAmL S39,.1 302.1 437.1 x 01.2

LAW3.9 0.2 12.0 11

0rFAA 0.1 WO. *.O-

CaDS PAS 0.1 34.0.:SA. Alm tglan . '.1 to.. 4.-VatCLI o.o 22.. G.e 29.L

TOTAL rl= ASaM a.. 35.? 107.: 4.aps t ,^o,lo.LL 310121N3cin,nmes wommti nl

u3. 0.5 10.. 21.9 31.8e

111MTfAI ALV - 0.°5 3. l5 ,.eC cm 0.9 2.2 i.e 10aokl

J11Ca OL a m AI? . 221.9 2.0 .-SUDIS CPU AMAZE? ~~~~~0.5 2.2 5.9 11.9

mm 0.9 1.9 0.1 oigmJsnas 0.0 3.2 1.4

.- 1rimlxzATTM Macon 1.2 2.2 12.2 8.02'

_nATen a2.0 3.1 10.1 16.2

A-UAUKT rr5 0.1 0.1 1.1 2.0 JM .SCE.ASU 0.. 1.6 0.0 J.a 5/

CM. OPUaTSS.L L1n 20.9 44.9 102.9 241.'

man, 20.7 1s.3 M/ a.e/Al 20.3 1FAMAD SALT

CAK 29.9 14. 2.9.eZ 0.1

tt AL. HAUCAK 47.3 143.2 lei.. Om.,

am 0.1 1.9 G..

3101NI TAX 0.0 1.0 1.5 Z.,

ChArE I r TAX 1. 2. 1. 2.3oQ G.. . 12.5

VAC 9L=NS 20.0

trAL ISL .2. 5.2 9.1 ' 5.-

CAM ova TO IC 1c3 1KA1 W0.0 13.0 129.0 10 .

TOUTA 3r mm 140.5 101.2 37.15 003.1

*I Confl id by FlAt' a expatrate aCcountnt.bl Projcted estiate from £ * ntbe actual 1e, figures prov:ded by lLP.el a-ad on past trends. t L. aesumed that only 252 of the value of the non-trvpanotulrat cattle

to be oId viii be recorded.di Subsidy of drugs only vntil Juv 1968.;i A 152 Intcrese l aeued from June 1985.

1 Dae ttc a large diecrepacy betwen 1983 and 198£ figure.. the average of the two ye-rs has be ntaken for 1985.

Ai About 1.1 million cattle la to be vacciated.h/ Purchee cost hlgber tha sale. value becm of inventory bulld-up.T1/ Altboug CQAF 6.3 million ha been actually epent in che first 5 motha. bullding Ia expected to

be completed In 1985 at the coat of 12 million.j Fve wnthb actual projected for the year.

ki lieeione estimte.1J Asmu_s - caer will he bought after April 1995.at Prom FlBCe- proavisa"l budget.

/ lssaon' estimate based on projected expenditures Itnluding mount expected for AY8C'* annual eeting.of hbed on 2EC a provicional budget and the projected eutimatee baed on 5 month of actual expenditures

Me tbh lta_ not ncludd In the provisional budget. In che caaa of cattle fend the five moth actuals used and it in -. ;d that It would not be used to purcbse ny are feet. use legal repreatation.

buy work clothes ant pay tax oan vhcle. ln 1985.AsumAee the sane discrepancy ill contiu as in previous years whre bonuae re glin to the tax andfee colletors proportionate to the amunt of money colleted. The ahare Is ununed to be 152.

i Fifty percent of the vaccination fee Is given to LS.r 198t wae an anceptional yer due to the Inauguration of the ANEC building.

arch 198U

- 71 - Annex 3-17

VENTRAL AMCR KEOUIC

A c CAuK Flow

(CrAr sillims. eurrut price. nI-M. thlmsftar Csnatut ITS pries)

nI m Fn Po ins no "I ne ns meo

SESom6~ 0/ *16.1 81.T 75T7.1 898.1 1007.0 £001.9 1061.9 1001.0 1007.0 610.9MAiTN AM6AL 1/ 0.1 0.1 0.0 0.0 0.1 0.1 0.7 0.1 0.1 0.7cnRICQ

TOT SALLUS 016. 2 015.0 757.5 898.a 1008.6 106.b 1008.6 108.0 1006.0 1006.0mart msuirozts

15XfW 1215. 111.1 213.3sq1Inet 57.2Vl!NlZS oz2.1 15.0 20.0 100.1 61.4

S .AlY C/ 21.1 10.1 03.3 38.0 35.8TCHICAL ASSISTArI 12.1 13.6 1305.0 151.0 70.0

AIDEIAL 25.5 11.1oAfelAL CaMsr 2U.6 21.2 10.1 33.6 33.3

TOTAL S1DSUll0 292.1 180.8 283.5 100.1 83.2TAXES AMI rlCS

TRYP*leCIOE 20.0 15.0CATLE AR 20.0 15.0

pm Smp h/ 6.7 103.6 127.5 105.1 231.0 133.5 000.8 756.7 1190.9 1919.8TOTAL .x7 AND DljES 126.7 111.6 121.5 105.1 211.0 113.5 090.8 756.7 1190.9 1939.8

CANSF OM Ffl PREVIOIUS YEAR 100.5 00.2 092.5 800.0 913.8 1128.8 1382.1 171.7 1369.1 1000.7

7itaL Sgams 999.0 1191.5 161l.0 2012.a 3297.1 2550.9 2905.5 153-.0 .632.0 6A9. 1

rXD ASrs

BIIL O1 S 125.8 111.1 213.1m321IST 57.2TEhICAL ASSISfAIC 120.7 13.0 140.6 151.0 70.bN.A2LL 25.5 13.1 5.D 5.0 5.9 5.9 5s S.9 5.9 5.9VIRCLUS 8.7 40.8 13.9 100.3 09.0 15.0 I: .0 45.0 05.0 120.0

TOTA.L FD0 ASSIS 421.9 29.12 197.8 306.8 106.1 50.9 125.9 50.9 50.9 12!.9OP W*AlGAL 5x90a2c1 E/

pLSOj d/ 75.'. 93.0 119.5 136.0 IS.0 305.0 1I05.0 1035.0 105.0 15.0iED1*inSuAvU AI.LWdAf el 11.1 12.3 13.2 10.3 1.0 12.0 . 12.' 12.4 12.4ornrc cos f/ 10.7 12.0 12.0 13.3 10.1 U1.1 1I.1 10.1 14.1 14.1VEUCIOtE ZP1AOoIR 30.3 l 4.1 1.I 1 08.11 52.6 12.0 52.0 52.0 52.6 52.0812tD1C 0am & 10.W 15.0 10.7 13.3 13.1 13.1 13.1 13.1 11.1 13.1RN

FELISTAIEES 5. 5.0 5.0 1 5 0 5.0 5.0 5.0 5.0 5.0w nPR xoi LW1*SES 8.0 8.0 8.0 5.0 8.0 8.0 8.0 8.0 8.0 8.0

mAxIMa 11.D 1;.o 1o.0 11.0 17.0 11.0 11.0 11.0 11.0 17.0AU TRIVE S .0 2. .0 2 .0 2.0 .0 2.0 2.0 2.0 2.0

.;SC1 5AMDS 5.5 s.s 1.5 1.5 5.5 5.5 5.5 S .5 S. 5.5TOTAL 0PCR*flbSL EXW Sf 186.1 211.s 202.2 201.9 275.1 275.1 175.1 275.1 275.1 275.1

S

DRUGS 291.2 416.9 50 05 601.6 762.8 1623. 162.8 102.8 162.8 702.8NATION AND SALT 0.1 0.2 0.3 0.0 0.5 0.5 0.5 0.5 0.5 0.5

CATTL

RICEWITA.L PURCASE 291.3 011.1 501.1 s 62.0 763.3 763.1 703.1 163.1 703.3 703.3

Rat'

mnjf 0.6 0.2 9.0 12.0 17.0 3 7 1 3.8 03.9 05.8 103.0

TRYAlFCC0D TAX

CATHLE NoRET 752DS h/ 36.0 23.3 10.3 15.9 02.1 02.7 42.7 02.7 02.1 02.7

vACCRboR

TOIAL RoA5 21.5 29.6 39.2 *8.5 00.1 05.0 71.5 86.6 108.5 15.J

CAM5T OM 0 PUI EAR 0W 00 .1 092.5 800.0 911.8 1128.8 1382.1 1113.7 230.1 1000.3 5105.0105L uCUS O rOlDS 9 9.0 1191.5 1601.0 2012.6 2297.1 2!30.9 2905.5 3539.0 0632.8 s -00 1

a/ Assumes a 402 margin in sales price over cost.bl Assuses a 152 increase in emubecship per year and fee increase at rate of inflation; 302 of membership fees is subtracted

from those joinlng associations; 1.200 In year 1; 3.600 in year 2; 6.000 in year 3; 8.400 in year 4; and 10.800 in year S.c/ Operational expenditures included all ANEC project-related incrementil costs and non-project-related expenses.t/ All staff.

/ At Government scale.f/ Project costs plus 82 increase in non-project office costs in PY2 to PY5.

jS Assues a 102 comission for agents collecting the dues and 302 for herders associations according to schedule (Annex 3-11);7.300 members paid their fees in 1985; a 152 increase in membership each year is assu2d. Membership fee expected toincraae with the rate of Inflation of 02.

h/ Aasses ea average of 42 rebate over total sales.

IIAPADMarch 1986

GrMUL AEUCAN 33MLLC

(rCA millions, current prices PYl-PY5, thereafter constant Pns prices)

PY1 P12 PY3 PY4 P1s PY6 P17 P 6 PY9 Fn1o P11 P112 PY13 Pn14 PY11 PY16 PY17 Pye Pyle M20

Tax"sTrypanocido Tax (a) 23 30 50 60 80 85 87 86 93 9A 95 96 97 97 97 96 98 99 99 100market tax (b) 17 40 70 100 140 142 165 147 156 157 159 159 161 162 162 163 164 165 165 166

Subtotal tama 40 70 120 160 220 227 232 235 249 251 254 255 258 259 259 261 262 261 261 265GovIt bud. contribution

Salary (c) (d) 550 560 580 556 600 625 625 625 625 625 625 625 625 625 625 625 625 615 625 625Vacciation fee () 22 1i 1 11 15 15 16 16 16 16 16 16 16 17 17 17 17 17 17 17lIternl contribution (f) 1215 1133 1225 1050 550Covt contrib. road mintmanc 0 13 53 98 ISO 150 150 15 0 150 150 150 150 150 150 150 150 150 150 150 150Producer's contribution 5 6 15 16 14

TOM LWjlol 1862 1820 2006 1894 1549 1017 1023 1026 101.0 1042 1045 101.6 1049 1051 1051 1053 1051 1056 1056 1058

Project inetment costs 998 684 934 871 380salaries (c) (d) 550 560 560 566 600 625 625 625 625 625 625 625 el5 625 625 625 625 625 625 625Severence payets Cg) 21 57 98Rod Mainternce 0 13 53 98 I50SO ISO 1 lS0 15 150 150 150 150 150 150 150 150 150 150 150 150Other exanditures 293 286 3541 359 419 212 248 251 265 267 270 271 274 276 276 278 279 281 261 283

TOTAL WTVky 1662 1820 2006 1894 151.9 1017 1023 1026 1040 1042 1045 1046 1049 1051 1051 1053 1054 1056 1056 1058

a/ 600 OW1/hahd of cattle sold at markets.b/ 1,000 CIAI/hsad of cattle sold at mhets. c/ Total staff cost provided by Gorimunt civil searvice tn. Includes also salaries for LS other activities and is therefore higher than total Governmnt contribution to project salaries N

in Ane 112. dl Based on salary saviisi i!YI CVAF 25 million; P12 60 million and P13 CAIA 140 million and salary increase of 86 (inflation rsts) and increse in higher level staff of CIAF 75 million '4 '

eully distributed over F13, TA4 end PYs.0/ Asr md FY1 20k, PY2 15k, and P3 owasrds; 10% cattle would be vaccinated at 50 ClAP per head.f/ temficiarim contribution in the construction of the dippi.z tanks.g/ A csAs 2 yer selary for regular staff and 6 naths for laborers who have becom de facto permanent sploy"e.

WAPADMarch 1986

Annex 3-18-73 - Page 1 of 4

CENTRAL AFRICAN REPUBLIC

NATIONAL LIVESTOCK PROJECT

ECONOMIC BENEFITS

Animal Health

The animal health package would increase the fertility rate anddecrease mortality. The expected effects per categorv of producers aregiven below.

Reduction in Reduction in Increase inCategorv of Producer Calf Mortality Yearli:gs Mortality Fertility Rate

Trained 50% 70% 202In Same Association 40% 50% 10%Reached Outside Assoc. 25% 30% 5%Not Reached - - -

These revised fertility and mortality rates have been appliedonly to the cattle population that would be reached bv the animal healthpackage. For the entire Central African livestock population it results inthe following average rates:

PY1(%) PY5(%)

Calf MortalityMales 32 25Females 28 21

Yearling MortalityFemales 10 6Males 12 8

Fertility Rate 53 58Meat

The marketing prospects for increased production are favorable.With the exception of strong occasional fluctuations in the mid 1970s,world market beef prices have been relativelv constant in real terms overthe last 20 years and can be expected to remain so over the next decade.The Western Africa Region as a whole is meat deficient and imported US$200million in meat and meat products in 1980. Moreover, if the supply anddemand trends over the last two decades were extrapolated to the nextdecade, Western and Central Africa would have a deficit of 2 million tonsIn the year 2000. Except for 1983, when the Rinderpest outbreak andcurrency restrictior in Nigeria caused a sharp drop in cattle prices,farmgate prices have been rising slightly in real terms over the lastdecade; they are again at the 1982 level of CFAF 220/kg liveweight, despitea doubling of the supply in the CAR over the last 4 years. In the project

Annex 3-18-74 - Page 2 of 4

financial and economic analyses stable prices are therefore assumed. Inaddition, FNEC would contribute to increase market information and wouldinform producers and traders of prices and volumes being offered in localmarkets.

Milk

Production would on average increase by 6,000 tons/year orapproximatelv 15,000 liters/day by PY5, which would be sold to vrillagers orconsumed by the family, especially in view of the low level of actualconsumption (0.01 liter per day per capita). Furthermore, studies arebeing carried out for the establishment of a small (4,000 liters/dav) milkproces_ing plant in Bangui for the Bossemble/Boda area. The Bank ofCentral Africa States ("Banque de Developpement des Etats de l'AfriqueCentrale" - BDEAC) has expressed an interest in financing such a plant.Moreover, the small scale cheese-making equipment envisaged for thesettlement areas would be another marketing outlet. The actual price atvillage level of CFAF 80/liter is therefore assumed to continue throughoutproject implementation.

Poverty Imract

Through the institution-building of FNEC and the nature of thetechnologies to be introduced, the project is expected to have a rositiveimpact on the poorer herders strata. The creation of herders associations,the herders training and the increased integration of these herdersassociations in ANEC would lead to greater participation of all herders,and not only the wealthiest, in the development of this sector. Theintroduction of fodder banks would increase milk production, and thereforebenefit the poorer herders, and women who depend on milk for a much largerpart of their income. Similarly, the introduction of animal tractionequipment and sheep and goat health packages would mainlx benefit the samegroup, as thev have to rely on cropping or smallstock to supplement theirsubsistence. Thus, approximately USS10.5 million or one-third of the totalproject costs would directlv benefit the poorer strata.

Environmental Risks of Settlements

All precautions would be taken to minimize environmental risks.The dip solution would be renewed twice a vear by oualified staff of theAgropastoral Unit, and later by the District Federation, as is presentlythe case. Effluent would not be drained in streams but would be percolatedinto the subsoil. The high degree of tick infestation of the grazing landsand the unavoidable irregularity with which herders would dip their cattlewould require that a control rather than eradication strategy be pursued.A contiauous low-level c&allenge would cause animals to develop a certainimmunity against the tick-bonie diseases and would make them lesssusceptible to heavy tick-loads, should the dipping system break down. Theassumed stocking rate of one head per 5 hectares in the settlement zonesreflects the minimum carrying capacity, thus greatly reducing the dangerof overgrazing. The grazing management scheme to be introduced and the

- 75 -

Annex 3-t8Page 3 of 4

integration of cropping with fodder banks will enhance the stability of

this ecosvstem.

Economic Rate of Return

Cost/benefit streams for the base case are provided below. They

include all economic costs of the project in the first five years, and

operational and vehicle replacement costs for the remnining 15 years. The

henefit stream is the sum of incremental value of meat and milk and the

value of herd increment that would result from lncreased fertility and

decreased mortality rates.

ECaUIC WU.YSIS

.... .. . . 5 . ... - ---- I-- -- -- -- -- -- - --- -- - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - -- - - - - - - __

1 2 3 4 5 6 7 B 9 10 11 12 13 14 15 16 17 to 1i 2

II!ttMCAL KEITITS

IrEP nozCiIms *5'.0 1:8B. 2183.0 3116.0 l¢5D.0 4912.0 5011.0 .e0 6955.0 7416.0 7763.0 8176.0 85.0 P47.0 9334.0 97." 10107.0 10494.0 118790.0

'LILICT MS

rceJ MOSTS '659.0 U56P.' £.6 940.0 482.0 645.0 3645.0 364.0 34.0 3645.0 345.0 345.D 3645.0 3645.0 3645.0 S.0 3645.0 3145.0 3645.0 364.0

It? RICTUS '4.£59.0 -520?.0 5000.0 -3257.9 lla6.0 305.0 1261.0 2366.0 29431.0 310.0 3771.0 4138.0 4531.0 4930.0 02.0 59.0 6077.0 6462.0 64.0 105145.0

A sensitivitv analvsis has been carried out to compare the imract

of changes in costs and benef4ts on the rate of return and net present

value of the project. The results are as follows:

EPR NPVZ (USS Million)

1L Costs Increase: 10% 13.6 4.0

20% 12.2 0.5

2. Benefits flecrease: 10Z 13.4 3.2

20% 11.6 -0.9

3. Cost Increase : 10,) 11.9 -0.2

Benefit Decreasp: 10%)

4. Cost Increase: 202) 8.7 -7.8

Benefit Decreaee: 20Z)

- 76 -

Annex 3-18

Page 4 of 4

The analysis shows that the project can effectivelv withstand theimpact of a 20% change in costs or benefits and practically also a 10%change in both cost and benefits. The ERR would remaini above or at the 122estimate of the opportunity cost of capital in these cases. Costs wouldhave to increase by 20% or benefits to drop by 20X for the project rate ofreturn to decline below 122. Eliminating the pilot and research activitiesand the infrastructure component from the cost analysis would increase therate of return to 20.5% and the NPV of the project to US$15.8 million. Inthat case, a cost increase of 10 and 20% would reduce the ERR to 18.6% and17.0% respectively, a change in the benefit of 10% and 20% to 18.5% and17.0%. Further information on the basic assumptions underlying the costand benefit streams, changes are in Working Files 225.990 (5) and 225.999(7).

WAPADMarch 1986

9 ~~C H1A D 5 S 1 D A N | r0CA 5 0 AFRICAN REPUBUC .

CAMEROON / -4sy>6Cuen\Xt -;9

_)- ^ } | t j2Bangu- v

\_1r~~~~~~~~~~~~~~~~~~~~~~~e / . /aAs

Ij~~~~~ CONGOqml_ .mnO tzns

CAMEROON I g/ O H OG ' 5Z-1-cST

wan / u7e

IBRD 19233

.~~~~~~~~~ -I

CENTRAI AFRICAN REPUBLIC.~ _ j';,. - \. REPUR! IOUt L ENTRAFRICAINE

.* '9fi! ob{ SI?/Ao '1 NATIONAL LIVESTOCK PROJECT-a)-' >, ' f -- \.PROJE, NA TIONAL D'ELEVAGE

/1- :, 4 A r ,_ 4q AI)vAMINISTRAIIv 1 fTAI tAhI?ANION 0f LIVESTOCK COMMUNITIES:r i' L? -- , j C,W,OA' ,,,, b , 11O l, . rLA'Wr DoS COPMUNES D'EIEVAGE'

'-.1... ii~~~~~~~~~~~~~~~~~~~~~~011. , ", I I'S ,,1b. * 'MNll . . .r

E e * ' . , ~ ~~~~ -- 21-OK srcnur u siav( &I~~~~~~~%CTiMt DTaIr"-mGt . -,vrsro**J lS II.A M ,

__~~~~~~~~ ~ ~~~~~ ~ ~~~~~~~~~~~~~~~~~~~~~~~~~ XI Icb '\> IN( -Miwl. *1 ^STl110CIL)nE

N liE ' I~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~t9 &.I 3 VQ

L } | S \ q ^ *Ilictt&.2r*~~~~~~e- I SINA'lCInU NS MI]?rSOil FIff it[INNIFS

A~~~~~~~~~~~~~~~~N.~~tFFf o,&Xll ,.:x5..............2..V7 , St.R..s;^^0rl",i;^L

Xos~~~~~~~ ~ ~~~~~~~~ *> t**. 'Mi IAIISM - ;,. ;.|..

/ *. - - - 11 l,Sdd.14 , y * ̂ *; l *t *4| ;- |.t -lAll.5E/ 'j "Ž

N! ' - -

T r.4llm /; .--s: I r- X-

inin. - - ''TtKO T .- .

* A,< 2 .' 7 \_ . fw eovob A

J I -; . .1

o) W ;|rsrz~~~~~~ngla -> - / " ~ ''~- - xr:Z-OOO

-- 010C -. 2'; ;'

/I a- ^.,.

-, - \.~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~.,i -iLPrt i^ J

.5~~~~~~~~~~~~~~~~~~~~~~{ - -, Sl llsp7oeUF P-.%.7R

I"~~~~~~~~~~~~~~~~~~~~~~~~~ _MA - --. , 2

*:10 lE- - 'N ;. *,; r- .

A-

F0 ) 5i -.- ----- * b t -r

P*51ill utjp( rP 1

Si' A lP -II(l,Jf I APtIAIS

- I iC n;PRO VINrjiFS PREFECTURES

50 100 '50 2A. 250

KCILOME! EP5....S-

id,

OC;Mi-Hr P 1985