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The World Bank

FOR OFmFCIAL USE ONLY

Report No. 6198

PROJECT COMPLETION REPORT

MALAYSIA

NORTHWEST SELANGOR INTEGRATED AGRICULTURAL DEVELOPMENT PROJECT

(LOAN 1522-MA)

May 21, 1986

Projects DepartmentEast Asia and Pacific Regional Office

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

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PROJECT CCMPLETION REPORT

NORTHWEST SELANGOR INTEGRATED AGRICULTURALDEVELOPMENT PROJECTLOAN NO. 1522 MA

1. CURRENCY EQUIVALENTS

US$1.00 M$2.48M$1.00 = US$0.40M'.1 million US$403,000

2. WEIGHTS AND MEASURES

1 millimeter (um) = 0.039 inches1 meter (m) = 39,37 inches1 kilometer (km) = 0.62 miles1 square kilometer (sq km) = 0.386 square miles1 hectare (ha) = 2.47 acres1 cubic meter (cu m) = 35.31 cubic feet1 liter (1) 0.264 gallons (USA)I litter/second (l/s) = 0.035 cubic feet per second1 kilogram (kg) = 2.2 pounds1 metric ton (ton) 2,205 pounds

3. ABBREVIATIONS

AFO = Area Farmers' OrganisationBPM = Bank Pertanian Malaysia = Agriculture Bank MalaysiaDID = Drainage and Irrigation DepartmentDOA = Department of AgricultureFAMA = Federal Agricultural Marketing AuthorityFDC Farmers' Development CentreFDSc = Farmers' Development Sub-centreFOA = Farmers' Organisation AuthorityGOM = Government of MalaysiaGRP Glass Reinforced PolyesterICB International Competitive BiddingsKADA Kemubu Agricultural Development AuthorityLPN Lembaga Padi dan Beras Negara = National Padi BoardLCB Local Competitive BiddingsMADA = 2uda Agricultural Development AuthorityMOA Ministry of AgricultureRISDA Rubber Industries Smallholder's Development AuthorityPMU = Project Maragement UnitSG. a Sungai = RiverT&V Training and Visit

4. MALAYSIAN FISCAL YEAR

January 1 to December 31

701 OFFCIAL USE ONLYTHE WORLD BANK

Washington, D.C. 20433U.S.A.

Ofrica DOf Dectow-GenalOpwrations Evalkat

May 21. 1986

MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT

SUBJECT: Project Completion Report: MalaysiaNorthwest Selangor Integrated Agricultural Development Project(Loan 1522-MA)

Attached, for information, is a copy of a report entitled"Project Completion Report: Malaysia Northwest Selangor IntegratedAgricultural Development Project (Loan 1522-MA)" prepared by the EastAsia and Pacific Regional Office. Under the modified system for projectperformance auditing further evaluation of this project by the OperationsEva-luation DepartnLent has not been made.

Attachment

This document has a restricted distribution and may be used by recipients only In the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

FOR OMCUIL USE ONLY


MALAYISA

NORTHWEST SELANGOR INTEGRATED AGRICULTURAL DEVELOPMENT PROJECT(LOAN 1522-MA)

Table of Contents

Page No.

Preface ................. ............................ iBasic Data Sheet iiEvaluation Summary ................ ........... ......... iii


East Asia and Pacific Overview. 1

Table 1 Quantity and Cost of Infrastructure Works 62 Project Costs by Categories 73 Project Costs Annual Expenditures & Disbursement. 8

Appendix: Borrower Comments ............................ 9

Annex 1 Borrower's Project Completion Report

Summary .... 13Overview 17Program Preparation aad Fornmlation 21Implementation 23Financial Performance ..... 31Institutional Performance and Development 33Conclusions , 49Appendices 51Annexes .. .... 59

Map: IBRD No. 13026

This documefnt has a restricted distribution and may be used by recipients only in the perfomanceof their official duties. Its contents maY not otherwise be disclosed without World Dnk authorization.

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MALAYSIA


PREFACE

This is a completion report (PCR) of the Northwest Selangor Inte-grated Agricultural Development Project in Malaysia, for which Loan 1522-MAwas approved on February 21, 1978, in the amount of US$26.0 million, andclosed fully disbursed on December 31, 1984.

The Borrower's PCR (Annex I) was prepared by the Project ManagementUnit, Northwest Selangor Integrated Agricultural Development Project, Min-istry of Agriculture, Malaysia, and submitted to the Bank in November 1985.The Evaluation Summary and Overview of the report, prepared by staff in theBank's East Asia and Pacific Region, are based on the PCR and a review of theStaff Appraisal Report (No. 1757b-MA, dated January 30, 1978), the LoanAgreement (dated March 8, 1978), Bank supervision reports, project progressreports and project-related Bank files.

The project was not selected for audit by OED as its most importantfindings and lessons are similar to those noted in the Project PerformanceAudit Report (OED Report No. 6023, dated December 31, 1985) of three otheragricultural and rural development projects in Malaysia, which were evaluatedin depth during the November 1984 to June 1985 period.

The Overview to the report was sent to the Borrower on March 11 forcomments. A telex received from the Borrower stating their satisfaction withthe report is attached as an appendix of the Overview.

The assistance provided during the preparation of this report bythe Government of Malaysia and the staff of the Project Management Unit isgratefully acknowledged.

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Pr53c 'rnLRSTOR ?

llortbvt Selantor Integrated Rural lmloomtt Protect (Lu. 1522 MA)

WSAIC DATA SM5

m rPUOJC DATA

Apprasal Actual or Actual es I of* Jtl4tr current eOtImAta apOlateol etiSte

Total prJeet coats (us$ million) 60.0 8't 145Lan Aount (USS million) - -. 1Date oard tapprowl Date effectivemes 06t2fl7Date p a"tcal coompot a completed -lt3t/N3 115

Prooratio thea coaP'ted (t)Closing date Ia 1t2131113 t213tt94Uesomic rate of return (1) nr_ 11_fiumnoais rata of return (1) *i/A_ I/A_?natitutional perfonmance ood

TeSdial performae Sc_ttg totry _

Womber of direct beneficitrioe (year 85) famili _3o 33.000 103

CUMULATWR DISSURSUWITSFT79 m0o ml M2 1183 FM "es

Appralil stimatte (US adillion) 1.7 6.4 13.3 20.6 26.0 - -Actual (UW sdllen) 1.0 1.4 1.6 11.6 20.8 25.2 26.0Attual an Z of eatinate 53 22 10 56 80 97 100Date of finl diaburemoent Septamber 1986Principal repaid to (eo./day/yr.) (SS; dillion)

8555ION DATA

Dote go. of Nlos-days Specializations Performance ty" ofMonn (ohr) persons in ftiold/b renrasented lc rating td Trend fe raoblms If

Reconneissance 05/76 3 18 En, Me, AtIdetIfication/ 08/76 6 75 En, EC, APrperation/FAO/CP - 4 66 En, Ee, AAppraieol 0477 5 7 Enk, IC, A

Subtotal 16 234

Sp"rveiion 1 068 - 3 9 Fe anA 2 3Suprviiton 2 01/79 4 8 aS StA 2 2 OTStpevielon 3 06/79 5 20 Ea En A 2 1 0Supervision 4 03/80 3 6 gEn t A 2 1 0Suprvieion 5 05/81 3 5 an 'PcA 2 1 0Supervision 6 07/82 3 7 En Ee A I ISuervidion 7 07/83 2 10 t EC 1 1Suereioion 8 01/S4 2 6 En A I ISuprwision 9 10/R4 2 6 Fn A I I

Subtotal 27 77

Completion 06/85 2 3 A,10/85 1 6 Ec

Total 3 7

oIUX PROJC? DATA

sorrowert Governmnt of falaysiaIhoeit *Reuey: Winiatry of AgricultureFi*cal eoar of Sorrovr: January I to December 31

lan of currency (abbreviation): Malaeyian Dollare (1s)

Currency Ichange RateApraiesl "sr averages VSSI.00 - 2.48

nteening nerc averae USJI.00 - 2.3-2.6Coupletioe r average 5SS1.00 - 2.4

FoLo_n robts

Loan/rerdIt umber:loan/credit amount (uSS sdllon):Date 8srd approval:

a Delayod one year due to leg in construction of civil vorks.eotitated on the bcai of amber of utsoaone supervised *ltultanouely.

A Agriculturlet; C - Credit Specialist; Se - Seonoest; an - ngineer./ I - Problem free or minor problems 2 * Moderate Problea 3 - Kalor Problem.

I - Improving 2 - Stotionery 3 * Deteriorating.Of - Maragerial T - Technical 0 - Other.

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MALAYSIA


EVALUATION SUMMARY

Introduction

The project was in line with the Government objectives to increasefarm incomes of the poorer groups, achieve national food security and divers-ify agriculture into new crops. The project also fitted with the Bank policyto redirect its lending program to Malaysia from new land settlement to ruraldevelopment projects.

Objectives

The major objective of the project was to raise the incomes andproductivity of about 32,000 smallholders dependent on the production of padiand treecrops in the coastal areas of the state of Selangor. This was to beaccomplished by the provision of infrastructure for:

- upgrading/intensification of an irrigation system dating back to1932 and serving 12,000 farmers cultivating 20,000 ha of padi;

- improved drainage and flood protection for about 10,000 farmersengaged in coconut/intercrops;

- provision of major drainage works to benefit about 10,000 smallfarmers cultivating mainly oil palm and the linking of this systemto those of the private estates bordering the project area, inwhich about 26,000 ha was planted almost entirely to oil palm.

The project had certain institution building objectives: notablyto encourage the formulation of long-term planning of irrigation works/drainage systems rather than the piecemeal engineering solutions of the pastand at the same time to develop a plan of agricultural operations to coordi-nate the activities of all supporting line agencies in an integrated effortto upgrade small farmer output and productivity. Total project costs wereestimated at US$60 million with a Bank loan of US$26 million to be disbursedover five years.

Implementation Experience

Project implementation was delayed by slow land acquisition, short-age and inexperience of staff during the early stage of implementation, latecompletion of final design, late tendering, and shortage of bullding mater-ials. Changes in project scope and design were madi: the project area wasincreased by about 2,700 ha, more buildings than planned were constructed andthe width of access roads was increased, while the quantity of civil works,

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mostly for irrigation, was reduced. The glass reinforced polyester flumesused for irrigation tertiary canals proved costly and fragile and are beingreplaced by concrete canals; the cost being borne by GOM. With the exceptionof land levelling, project works were completed by the end of 1985, threeyears behind schedule. The project was implemented by six different agen-cies, coordinated by a Project Management Unit (Pil). Although the Directorof the PMU performed well due to his strong personality, hs lacked the auth-ority and power needed to coordinate all project activities. Due to delays,inflation, increased cost of materials and land acquisition and changes inproject design and scope, the total project cost is now estimated at US$87.0million, a 45% overrun.

Results

Agricultural production has not yet reached its full productionstage. Although padi and treecrop yields have been lower so far thanexpected at appraisal, there is some evidence of improved farm managementpractices and crop diversification, with oil palm partly replacing rubber andcoffee, due to favorable prices, and a substantial increase in cocoa inter-cropping with coconut. ERRs, compared with appraisal projections of 19% forpadi irrigation, 22% for treecrop drainage and 21% for the overall projectare now estimated respectively at 1%, 27%, and 8% by the Bank Overview, and2%, 64% and 20% by the Borrower's PCR. It is OED's opinion that the Bankestimates are more realistic. The low overall rate of return is mostly dueto project time and cost overruns, lower crop prices and lower yields thanestimated at appraisal. Nevertheless, farm incomes have increased and thepoverty level has decreased in the project area because of (i) the Governmentsubsidy and support price policy for the agricultural sector and (ii) off-farm employment due to the booming economy of the country. The project tookinnovative measures to monitor the incide-ce of poverty and undertakefollow-up evaluation studies.

Sustainability

The sustainability, or improvement, of the project benefits largelydepends on the success of the measures currently tested in Malaysia (landconsolidation, establishment of farming groups aDi mini-estates) to remedythe small and uneconomic size of the farms. Another condition required forproject sustainability is an adequate operation and maintenance of the irri-gation and drainage works.

Findings and Lessons

The project did not fully achieve its objectives. While an impor-tant reason for the project's mediocre performance is the depressed price ofmost of the project's products, some factors, already noted in similar proj-ects in Malaysia, have adversely affected the project's outcome:

(a) the project delays and cost overrun have been mostly due toinsufficient preparation, premature appraisal and insufficientattention paid to the country's shortage of qualified staff at alllevels;

(b) the project was mainly an infrastructure (irrigation and drainage)project with little consideration given to the agriculturalcomponents;

(c) the principle of a PMU responsible for coordinating other agencieshae no chance to be successful unless the project manager is givenrank and power superior to those of the agency directors;

(d) land acquisition, mainly in irrigation and drainage projects, needsto be closely scrutinized at appraisal as it is a constant sourceof implementation delay unless land offices are adequatelyreinforced in staff and financial resources.

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MALAYSIA

NORTHWEST SELANGOR INTEGRATED AGRICULTURAL

DEVELOPMENT PROJECT (LN 1522-MA)

Project Completion Report

East Asia Pacific Regional Overview

Introduction

1. This overview is based on the PCR for the Northwest SelangorIntegrated Agricultural Development Project (Ln. 1522-MA) (Annex 1) preparedby the Project Management Unit (PMU) in the Ministry of Agriculture (MOA), andsubmitted to the Bank in November 1985. The PCR reflects the views andopinions of Government officials closely associated with the project and ingeneral, presents an objective view of project implementation, performance andimpact.

Project Objectives

2. To improve the productivity and incomes of smallholder farmers andto improve regional drainage systems with subsequent subsidiary benefits forthe Northwest Selangor Region's towns and estates, the project includedrehabilitation of 20,000 ha of padi land in the Tanjong Karang area; rehabili-tation and improvement of drainage and flood control systems serving some77,000 ha of tree crops; construction of offices, staff quarters, storehouses,and drying floors; and the provision of vehicles, equipment, and training tcsupport extension, agricultural credit, input supply, and marketing in theRegion. The project wa3 appraised in April 1977 and approved in February1978; the Bank loan for US$26 million was signed in March 1978 and becameeffective in June 1978. Project construction was completed in December 1985,three years later than scheduled.

Project Formulation

3. The project was proposed by the Selangor Drainage and IrrigationDepartment to increase padi and tree crop production by upgrading drainage,irrigation and agricultural support services. Following a May 1976identification mission the project was prepared by FAO/CP with Government ofMalaysia (GOM) assistance. Based upon detailed layout and design of 27% ofthe irrigation area and 10X of the drainage area, major investments wereidentified. During project implementation targets were revised as moreexperience and information became available. Improvements to be made inagricultural support services were outlined in the preparation and StaffAppraisal Reports but the most detailed guidelines were published in theBorrower's Operation Manual (October 8, 1978). However, incomplete dataduring preparation (number of beneficiaries, crop yields, farm income andproject costs) gave rise to overly optimistic expectations (Borrower's PCRparas. 2.04-2.06).

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Project Implementation

4. Project Mangement. The PMU, established in 1978 and responsible forproject implementation, was effective and its' reporting was extensive andtimely. The various agencies involved in project implementation were: theDrainage and Irrigation Department (DID) for design and construction of civilworks, and operation and maintenance of new systems; the Department ofAgriculture (DOA) for organization of farmers and exten3ion services, fa-mertraining and supply of improved seeds and planting materials; the Farmers'Organization Authority (FOA) for input supplies, mechanization services, localmarketing and farmers' participation in agri-business activities; the BankPertanian Malaysia (BPM) for credit facilities; the Malaysian AgricultureResearch and Development Institute (MARDI) fir basic and applied research anddevelopment of appropriate technology; and the Land Office for matters relatedto land acquisition. The project was guided, particular'.y on policy matters,by a Federal Steering Committee headed by the Secretary General MOA. Whileeach agency was responsible for implementing specific activities within itsjurisdiction, responsibility for coordinating all project activities restedwith the Project Director. The borrower suggested that future projects shouldprovide detailed job descriptions and agree the authority and responsibilitiesof the Project Director and role of each of the line agencies (Borrower's PCRpara. 5.18).

5. The appointment of a Project Manager (director), who was to have asmall staff to assist in budgeting, procurement and disbursement matters, was acondition of loan effectiveness. In retrospect, lack of experienced staff iAthe implementing agencies, particularly in the early stages of the project, wasa major constraint. At appraisal additional staff requirements were estimatedas 396. By the end of 1979, 213 posts were established and 179 (84Z) filled.The maximum staff (259) of an authorized 314 was in place in 1983. DOA filled79% of the incremental posts, DID 65% and FOA 48%. The borrower felt that thenumber of authorized posts was adequate but that implementation would have beenbetter if all posts had been promptly filled and the frequent turnover ofleaders restrained (Borrower's PCR paras. 5.09-5.14).

6. Project Revisions. During project implementation, changes in projectscope and design were made. An additional 2,673 ha, including some 350 ha ofland in Ganda Sali in the State of Perak (adjacent to the project area), wereincluded in the project; the width of access roads was increased from 4 m to6 m; additional quarters were constructed for PMU staff; the number of Farmers'Development Centers (FDCs) was increased from 10 to 12; and road maintenanceequipment was reduced to about 40% of the appraisal estimate since maintenancework was to be carried out by contract in accordance with the Government'spolicy of privatization. Most important, the quantity of civil works wasreduced as better information became available (see para. 3). Compared toappraisal, actual construction ur.der the padi irrigation component was 56% ofmain canal and feeder canal improvements; 88% of distributary and tertiarycanal construction; 167% of drain construction (an exception); and 76% of roadsand bridges. For the tree crop area drainage component, 93% of tidal controlgates were provided; 35% of drain construction; and 44% of roads and bridges.

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In retrospect, increases in project area and changes in works contributed toproject delays and, due to inflation, also contributed to increased projectcost.

7. Physical Progress of Project Implementation. A comparative summaryof actual project costs and the appraisal estimate is in Table 2. Atappraisal, planning and design of civil works were to start in January 1977.However, the Loan Agreement was not signed until March 1978 and implementationstarted in June 1978. Accordingly, completion of works was extended fromJanuary 1983 to December 1983 and later to December 1985. The main cause ofdelay was shortage of experienced staff during the early stage of projectimplementation. According to the Borrower's PCR (para. 3.11) it took from June1978 to December 1979 to staff 80% of the required posts and, as a result, mostcivil works tenders were called after 1981. Despite delays, project objectiveswill be largely fulfilled. At appraisal it was envisioned that irrigationwater was to be supplied to padi areas by glass reinforced polyester (GRP)conduits, but performance was not satisfactory due to inadequate structuralstrength, deterioration, and susceptibility to damage and GOM substitutedconcrete conduits for tertiary canals. Land shaping which is required forimproved water management, is estimated to cover only 47% of the padi area inpart due to cost, lack of proper equipment and the need to reshape the landseveral times.

8. Contracts. Most civil works were carried out under contract with nomajor problems. As envisaged at appraisal, international competitive bidding(ICB) was used for construction of irrigation works and local competitivebidding (LCB) for drainage and building contracts. With the exception of oneJapanese firm, all bidders under ICB were local firms. Of the six contractsexecuted for padi irrigation works, three were accepted on time; the otherthree were delayed by 3 to 6 months due to site problems. Of the sevencontracts for drainage works, five were completed on time, and two contractswere delayed by 6 months mainly due to land acquisition problems.

9. Project Costs and Financing. At appraisal, estimated project costswere US$60 million, of which US$26 million, or 43%, was financed by the Bank.However, due to delays, inflation, increased cost of land acquisition andmaterials, and changes in project scope and design, the costs were re-estimatedin Uecember 1979 at US$87 million. Final costs were US$87 million. Theincreased cost of US$27 million was borne by the Government. The majorincrease was for the padi irrigation component which increased by 155%. Tables2 and 3 show project costs by category and annual expenditure respectively.

Project Impact

10. Under the project, irrigation water was provided for 19,641 ha ofpadi, and drainage and flood control works serving 80,255 ha of tree crops werecompleted. Yields have been in general lower than expected at appraisal butare expected to increase over the next few years. The padi yield in 1984 wasabout 75% of the appraisal projection; cocoa, about 62%; oil palm (FFB), about72%; and rubber (latex), abour 71%. Seven-year average yields for secondseason padi were as projected but first season yields were 80% of appraisalestimates. Oil palm yields have increased but other tree crops are highly

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variable, except coffee which seems to have declined, probably because ofunattractive prices and intensive labor requirements. The integrated agricul-tural services supported under the project started slowly due to staff shor-tages but strengthened later. Farm incomes in the project area have increasedsubstantially, due to fertilizer subsidies, padi support prices, favorable treecrop product prices and off-farm employment. The Borrower's PCR(para. 5.15(c)) estimates that absolute poverty declined from 65% in 1977 to50% in 1984. There is some evidence of changing cropping patterns: oil palmincreastagly replaced rubber and coffee due to favorable prices, and cocoaintercropping with coconut increased from 9,300 ha in 1977 to 14,300 ha in1984. No significant cropping pattern changes are expected in padi and coconutareas. The Borrower's PCR, Appendix V compares cropping patterns at projectappraisal and completion.

11. Other effects of the project include increased farm mechanizationinduced by project-financed farm road improvements - about 80% of farmoperations in the padi area, and land preparation and new planting work in treecrop areas. Water management committees have been set up; cropping and farmmanagement practices have been improved; and farmers now use recommended padivarieties, more fertilizer, direct seeding, etc. The agricultural extensiontraining and visit system is used throughout the project area and 605 farmergroups are organized.

Economic Rate of Return

12. At appraisal the estimated economic rates of return were 19% for padiirrigation, 22% for tree crop drainage, and 21% for the overall project. Atcompletion, the revised estimated ERR are 1% for padi, 27% for tree cropdrainage and 8% overall. Because many schemes were only recently completed,projections are based on the actual performance since 1982 and expected yieldsand cropping intensities. In estimating rates of return, investment, O&M andcrop production costs have been adjusted by GDP deflators and appropriateconversion factors. The project life is assumed to be 25 years and crop prickare based on the Bank's 1985 world market price projections. The low rate ofreturn for padi is due mainly to increased project cost, lower projected 14'mprices, and project delays. Recent Bank projected padi prices aresubstantially lower than projected at appraisal, and the investment in padiirrigation was more than 50% above appraisal estimates (see para. 9). Ifcurrent projected prices increase by 25%, ERR for the padi component wouldincrease to 5%; and for the total project to 11%.

Institutional Performance and Development

13. Although project implementation suffered initially because ofinsufficient experienced staff in the early years, institutional performanceand development generally conformed to appraisal expectations. The PMUperformed well and effectively as project coordinator. However the ProjectDirector's lack of clear authority and the involvement of the policy SteeringCommittee in project management were reported as constraints. The SteeringCowmittee, chaired by the Secretary General of MOA, initially met every two tothree months but later only every six months, and the PMU had an advisory rolerather than direct control. The implementing agencies, DID, DOA, FOA, BPM,MARDI, and the Land Office, all performed well.

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Bank Performance

14. Eleven Bank missions, totalling some 84 man-days, semi-annually inthe beginning and annually in later years, visited the project during the sevenyearb of its implementation. Bank supervision missions acted as a catalyst bymaking recommendations on technical matters and agricultural development. Inretrospect, more frequent missions, particularly in the early years, would havehelped implementation. The PMU assessment of the Bank's supervision perfor-mance (PCR para. 5.24) is: The Bank's Supervision Mission did a good job butcould have done better if all mission members consisted of qualified andexperienced personnel with pleasant personalities. Equally important is thecontinuity of mission members; there is a tendency for the Bank to change thecomposition of the mission team too frequently.

Lesson Learned

15. The Borrower's PCR summaries lessons learned under the project(paras. 6.01 to 6.06) as follows: (a) over 95% of project funds were allocatedto infrastructure development while agricultural support services received lessthan 5X -- a more balanced program including more agricultural/human develop-ment elements would have been desirable; (b) the country's shortage of qualifiedstaff and difficulties of recruiting experienced staff at all levels shouldhave been given due consideration at the time of project formulation; (c) thePMU had only a coordinating role in project implementation but it should havebeen given more authority so that it could control and manage funds andresources more effectively; and (d) the planned 5-year time period for infra-structure construction was too optimistic - the project schedule and start-uptargets should have been more realistic and achievable.

Table 1-6-

MALAYSIA

NORTHWEST SELANGOR INTEGRATED RURAL DEVELOPMFNT PROJFCT (LOAN 1522-MA)

PROJECT cOMPLETION REPORT

Ouantity and Costs of Infrastnrcture Works(Costs in US$ million)

Appraisal reportestimate (1977) Actual (19R5)

Item Unit Ouantity Cost Ouantity Cost

Padi IrrigationLand acquiaition ha 72 0.2Q 127 2.20Readworks improvement Lump sum - 0.20 - 0.04Main canal and feeder

canal improvement km 78 0.50 39 2.03Distributary canal 14 5Structural tertiarycanal " 492 16.92 399 37.25

Drain construction " 158 2.59 237 0.86Roads and path " 730 1.54 469 1.62Bridges and culvert no 274 197Engineering andsupervision Lump sum 1.74 '.11

Others - - 16.61Area served ha 20,0no - 19,641 -

Subtotal 23.78 60.72

Tree Crop DrainageLand acquisition ha - - Ql 1.42Coastal/river bunds km 270 0.64 141 0.85Tidal control gates no. 30 1.93 27 3.40Drain construction km 2,450 6.32 R36 2.47Roads km 1,090 3.n6 463 2.15Bridges no 317 - 336Pump station no 1 0.27 - -Engineering andsupervision Lump sum 0.98 0.43

Others - - 6.47Area served ha 77,000 - 80,255


Buildings and FacilitiesProject offices no. 2 n.1F 2 0.54Staff quarters no. 107 0.96 134 2.58Farmers' developmentcenters no. 10 0.57 12 1.61

Land acquisition ha - - 15.4 n.77Engineering andsupervision Lump sum 0.14

Subtotal 1.83 5.8A

RquipmentFor DID and DOA Lump sum 1.40 0.57

Incremental AgriculturalServices " 1.50 2.20

Contingencies " 18.25 - -

GRAND TOTAL 6n.00 87.0o

Revised 01/25/86

Table 2-7-

MALAYSIA

NORTHWEST SELANGOR INTEGRATED RUPAL DEVELOPMENT PROJECT (LOAN 1522-MA)


Project Costs by Categorles(in TJS$ million)

Estimated DeviationAt December Actual from appraisal

Categories appraisal 1977 costs Amount

Padi irrigation (Tarjong Karang) 23.8 48.7 60.7 +36.9 +155

Tree crop drainage 13.2 21.9 17.7 +4.5 +34

BuildinR and facilities 1.8 2.9 5.8 +4.0 +222

Equipment 1.4 2.3 0.6 -0.8 (57)

Tncremental agricultural services 1.5 2.3 2.2 +0.7 47

Physical contingencies 5.5 2.5 - -5.5 (100)

Price contingencies 12.8 6.7 - -12.8 (100)

Total Project Costs 60.0 87.3 87.0 +27.0 45

Disbursements

From GOM 34.0 61.0 +27.n 79

From IBRD 26.0 26.0 0 0

Total Disbursements 60.0 87.0 27.0 45

Table 3

MALAYSIA

NORTHWEST SELANGOR INTEGRATRD RURAL DEFVLOPMENT PROJECT (LOAN 1522-MA)


Project Costs - Annual Expenditure & Disbursements(in US$ million cumulative)

Project costsAt Disbursements

Year appraisal Actual Appraisal Actual

1978 3.97 1.4 - -

1979 14.84 2.3 1.7 1.0

1980 31.01 6.2 6.4 1.4

1981 46.50 14.2 13.3 1.4

1982 59.13 26.7 20.6 11.6

1983 60.00 16.4 26.0 20.8

1984 - 11.5 - 25.2

1985 - 8.3 - 26.0

Total 215.45 87.0 68.0 87.4

Appendix- 9 - Borrower Comments

JWS0377 J80439 IN 10/22t1 OUT 10/2217EPUPM MA30098EPUPM MA30098

KUALA LUMPUR11.4.86

MR. YUKINORI WATANABEWORLD SANK, IISA

RE: PROJECT COMPLETION REPORT ON MALAYSIA NW SELANGORINTEGRATED A(RICULTURAL OEVELOPMENT PROJECT (LOAN 1522 - MA)#WE FIND THE DRAFT REPORT SATISFACTORY AND THE STATEMENTSMADE AS REFLECTIVE OF THE VIEWS EXPRESSED IN BY THE PROJECTOFFICE. THE PCR PREPARED BY THE PROJECT OFFICE WAS DISCUSSEDIN DETAIL WIrH THIS UNIT AS WELL AS BY THE PROJECT STEERINGCOMMITTEE. AS SUCH WE DO NOT HAVE ADDITIONAL COMMENTS TOMAKE AND WIIL AWAIT A COPY OF THE FINAL REPORT WHICH YOUWILL PRESENT TO THE BANK'S EXECUTIVE DIRECTORS.

REGARDS DR. NIK IBRAHIM NIK MAHMOOD

I I

I '110~~~~'

t~

I

MALAYSIANORThWST SEANORINTESATO ASONCULTUAL

, DlE/ELOPIMENT PROJECT(LOAN NUMBS 1522 MA)

PROJECT COMPLETIONREIPORT

PROJECT MANAGEMENT UNITNORTHWEST SELANGOR INTEGRATED AGRICULTURAL

DEVELOPMENT PROJECTMINISTRY OF AGRICULTURE MALAYSIA

AUGUST 1985

-XCFRyoS - , r;7 -4-

PROJECT COMPLETION REPORT SUMMARY

Northwest Selangor Project - 1522 MA

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SUMMARY

1. The Northwest Selangor Integrated Agricultural Development Project

was launched in June 1978. It covers some 19,500 farm families on

100,199 hectares of agricultural land straddling the 2 northwesteri

districts of Sabak Bernam and Kuala Selangor in th& State of Selangor.

2. The major objectives of the Projnct were to increase the yield of

various crops in the Project area, maximise farm incomes and alleviate

rural poverty and improve quality of life of 19,500 smallholder farm

families. It was also the intention of the Project to develop the

farming society to be self-reliance, progressive and commercially

orientated.

3. The major components of the Project were the upgrading and rehabi-

litating the irrigation and drainage facilities in the area and the

setting up and implementation of an integrated agricultural supporting

services with a common delivery system. These 2 components are supple-

mentary and complementary to one another in meeting the Project targets.

4. Project formulation originated in the efforts of the various agen-

cies to upgrade existing irrigation and drainage infrastructure and to

promote agricultural improvement in this major agricultural subregion

of the Selangor State. The agencies that are involved directly in the

implementation of the Project were the DID, DOA, FOA, BPM, MARDI and

Land Office.

5. Work on the Project started in June 1978 and was scheduled to be

completed by end of 1983. It is now anticipated that all major cons-

truction works would be completed by October 1985. Thus, there is a

time overrun of approximately 1 years.

6. The major problems faced by the Project were staff shortages and

inexperienced staff, delay in land acquisition and shortage of 'bakau'

piles. Although these problems were overcome later, the implementation

schedule was inevitably affected.



- 14 -

7. The important changes made to the Project scope and design were

the inclusion of Ganda Suli in the State of Perak, increase in width

of access path, construction of additional quarters for PMU's staff,

increase in number of Farmers' Development Centres/Sub-centres and the

reduction of procure'ent of equipment. The number of Area Farmers'

Organisations was increased from 3 to 5.

8. The original Project cost was US$60 million. However, due to time

overrun, inflation, increases in cost of materials and also changes in

Project scope and design, the actual Project cost escalated to US$87.0

million. The World Bank financed US$26.0 million or 29.9% of the

Project cost, while the balance of US$61.0 million or 70.1% was borne

by the GOM.

9. The disbursements made from the World Bank were completed on sche-

dule but did not follow the Appraisal expectations. The disbursements

were low in the first 3 years and only caught up with the Appraisal

expectations in 1982 and 1983. The slow disbursement in the early

years was due to the slow Project start-up.

10. The overall performance of the contractors and suppliers could

be considered as good. There was very little problem with the con-

tractors. There was also no problem in the procurement of equipment

as this formed a small part of the Project component.

11. The GOM always allocated sufficient funds for the. Project. Although

in the initial years,the annual allocations were less than the Apprai-

sal annual projections, it did not affect the Project implementation.

This was due to the implementation being slower in initial years because

of the slow Project start-up.

12. The type of organisation and management system practised in the

Project was of the coordinative type as opposed to the authoritative

type. Such set-up relied heavily on committees and meetings as there

was little integration of management in the Project. Although there

were weaknesses in such organisation and management set-up, yet the

set-up helped a long way in ensuring smooth implementation of the



- 15 -

Project. The system, however, should be reviewed if the Project records

are to be improved.

13. There was growth in the number of staff and office space of the

implementing agencies. The staff growth in all categories for DID was

204 (at its peak), DOA was 49, PMU was 38 and FOA was 29. The office

space for all implementing agencies were housed under one roof. The

headquarters of the Project is situated in Kuala Selangor and one

branch office in Sungai Besar. There were 1 FDC and 11 FDSc and all

are strategically located in the Project area to serve the farmers.

14. The staff requirement of the Project was essentially to top up

the existing staff, of the implementing agencies in the Project area

in order to enable them to strengthen and consolidate for Project

implementation. The number of posts established under the Project

was 314 (at its peak) or 79% of the Appraisal Report's requirement

of 396. This number was adequate for smooth implementation of Project.

However, some of the posts established were not filled and if all

were to be filled the performance of the Project would have been

better.

15. The Project was affected by staff shortages and inexperienced

staff especially in the early stages of Project implementation. This

was compounded by a frequent turnover of key personnel. The perfor-

mance of the Project would have been better if the staff were adequate,

qualified and experienced.

16. There had been increases in the yield of various crops in the

Project area. However, the yield fluctuated in consonance with the

vagaries of the weather, pests, etc. Padi, cocoa, coconut, rubber and

oil palm yields all showed an upward trend. However, there had been

a decreasing trend in the yield of coffee as the farmers showed decli-

ning interest in this crop.

17. There had been increases in incomes of Project farmers. These

increases in incomes could be attributed to a number of factors, among

which are increases in the yield of crops, subsidies by GOM, changes



- 16 -

in prices of commodities, availabilities of off-farm jobs, etc. With

this increase in income, the absolute poverty rate among the Project

farmers also dropped from 65% in 1977 to 50% in 1983 and 56% in 1984.

The revised economic rate of return for the Project is 20%.

18. There was no plan to change the cropping pattern in Project area.

The padi and coconut areas remains unchanged. However, there was ten-

dency among Project farmers especially in the Kuala Selangor district

to change their rubber and coffee to oil-palm due to better prospects

of the crop. Cocoa intercropping with coconut is very popular among

smallholders and increased tremendously.

19. Therei is tendency among farmers to mechanise their farming opera-

tions in order to save time and costs. There- had also been other

changes in farmers' attitudes including the using of improved and re-

commended padi varieties, changing to direct seeding method of padi

cultivation, adopting mature-budding techniques to improve cocoa stand,

greater use of agricultural chemicals and participation in pest manage-

ment programs and greater utilisation of agricultural credits. The

farmers also realised the importance of water management in their

padi farming operation which is an on-going program in the project and

would further be strengthened.

20. There had been a close relationship between research and extension

in the Project which came about through the management organisation

system set-up for the Project. In fact, in order to reap the full

benefits from the implementation of this Project, the existing organi-

sation should be maintained and strengthened to run the Project.

21. The Bank's Supervision Mission had done a good job, but could

have been better if all of the Mission's members were to consist of

highly qualified and experienced personnel with pleasant personalities.

Equally important here is the continuity of the members of the Mission,

as there is tendency for the Bank to change the members of the Mission

team frequently.

ROJECT COMPLETION REPORT MAIN REPORT


- 17 -

1. OVERVIEWu

PROJECT BACKGROUND

1.01. The Northwest Selangor Integrated Agricultural Development Pro-

jects (subsequently refered to as the Project in this report) launched

in June 1978, is the sixth integrated agricultural development project

(IADP) to be lmdertaken by the Ministry of Agriculture. It is, however,

the first such project for the State of Selangor.

1.02. Th4 Project straddles the 2 northwestern districts of Sabak Ber-

nam and Klala Selangor in the State of Selangor and covers some 100,199

hectares of agricultural land as indicated on the map in Appendix I.

The distribution of crop acreages and farm households within the Project

area is as shown in Table 1.

Table 1 - Distribution Of Crop Acreages And

Farm Households In The Project Area

No. Of FarmCrops (ha) Households Mainly In

(h) lexisting)(a) Smallholders

Padi 19,641 5,909 Tanjong :KararigIrrigation Area

Coconut/Cocoa 32,751 8,405 Sabak Bernam(14,261 ha. Districtintercroppedwith cocoa)

Rubber 5,3 Kuala SelangorOil-Palm 4,619 ) 5,186 DistrictCoffee 1,641 )Sub-total 64,189 19,500

(b) Estates

Oil-Palm 21,269 - ) Kuala SelangorRubber 5,884 - ) District

Coconut 3,652 - )(3,472 ha. ) Sabak Bernamintercropped - Districtwith cocoa)

Cocoa (sole crop) 1,430 - )Sub-total 32,235 -

Grand Total 96,424 19,500

Notes:-(i) * - Data from 1984 First Half-Yearly Report,

Department of Agriculture Selangor.

PROJECT COMPLETION REPORT MAIN REPORT


- 18 -

1.03. The average padi farm size in the Project area is 1.78 hectares.

84% of the padi farmers are owner-operators. In the coconut areas,

the average farm size is about 1.0 hectare in Sabak Bernam and 1.3 hec-

tares in Kuala Selangor. 94% of coconut smallholders are owner-opera-

tors. For other crops like oil-palm, rubber and colfee, the average

farm size is 1.2 hectares, 1.0 hectare and 0.4 hectare respectively.

1.04. The total population in the Project area is 216,350 comprising

of 64% Malays, 21% Chinese and 15% Indians. Approximately 72% of the

population are involved in agricultural activities. There are 19,500

farm households and on the average there are 6.0 persons per farm

household.

MAJOR OBJECTIVES OF THE PROJECT

1.05. The Project was conceived towards fulfilling the following major

objectives:-

(a) To increase the yield of various crops within the Project

through the provision of improved irrigation, drainage,

farm roads and intensified agricultural supporting services;

(b) To maximise farm income through raising productivity as

envisaged in (a) and efficient utilization of resources;

(c) To alleviate rural poverty and improve quality of life of

33,000 smallholder farm families, 65% of whom were consi-

dered to be living in absolute poverty at the time of

Project .cptaisall/ ; and

(d) To develop a farming society that is self-reliance, prog-

ressive and commercially orientated.

STRATEGIES EMPLOYED

1.06. Towards fulfilling the set objectives, the Project chartered

the following strategies:-

(a) Upgrading and intensifying the irrigation and farm road

1/ - Absolute poverty refers to situation where annual per capitaincome is below the estimated poverty line income ofUS$215 at the time of Project Appraisal.

PROJECr COMPLTI!ION REPORT MAIN REPORT


- 19 -

systems in the padi areas to ensure sufficient and efficient

water supply to padi fields and for convenient transporta-

tion of padi to market and supply of agricultural inputs

to farms;

(b) Upgrading and intensifying the drainage and farm road

systems in the tree crop areas to alleviate flooding and

for convenient transportation of agricultural produce to

market and supply of agricultural inputs to farms;

(c) Consolidating and strengthening the agricultural supporting

services and its delivery system to the farmers through

training and visit (T&V) system of extension;

(d) Utilising efficiently all factors of production i.e. land.

labour, capitaL,. technology and management to increaseproductivity; and

(e) Providing training to farmers on modern farming techniques,

concept of cost, expenditure and profit and instilling a

sense of pride and spirit of self-reliance and cooperation

among farmers.

MAJOR PROJECT COMPOIJENTS

1.07, Under the Project, the basic infrastructure for on-farm develop-

ment of the irrigation and drainage systems are provided under the

irrigation, drainage and civil works component while the back-up faci-

lities and services to ensure that such improved infrastructure can be

properly utilised to attain the major objectives of the Project is

provided under the integrated agricultural services component.

(a) rrigation, drainage and civil works - Under this component

the Project would:-

(i) Rehabilitate the existing headworks, diversions, main

canal and structures serving the 19,641 hectares of padi-

land in the Project area, construction of tertiary irri-

gation and drainage networks which would service each

ihdividual 1.2 hectare padi lot, construction of required

access roads (i.e. to improve in-field transportation)

and provision of requisite maintenance equipment;


Northwest Selangor Project - 1522 MA -

- 20 -

(ii) Rehabilitate and improve the existing drainage and

flood mitigation system serving 80,255 hectares of

tree crops, including upgrading, reconstruction and

provision of coastal and river bunds, tidal gates,

bridges and gated-culverts in association with the

construction of an intensive drainage network and

upgrading the main drainage system in estate areas

(i.e. to improve water control, flood control and

water table control in the rain fed tree-crop areas)

and the provision of farm access roads and bridges

(i.e. to improve on-farm transportation); and

(iii) Construct 2 Project Office Complexes, 1 Farmers' Deve-

lopment Centre, 11 Farmers' Development Sub-Centres

and requisite staff quarters.

(b) Integrated Agricultural. Services - Past experiences have

indicated that full benefits from major investment in

irrigation and drainage systems would only be forthcoming

provided that there is an accompanying, often times drama-

tic, improvement to the organisation of farmers; efficient

management of the irrigation and drainage systems so cons-

tructed; the efficiency of the extension service; the supply

of credit and inputs; and the handling of farm produce.

This cognisance has led to the inclusion of the integrated

agricultural services component. This involves the setting

up of an integratel organisation and management system de-

sigfied to coordinate planning, implementation, progress

evaluation and continuous training of all levels of personnel

of the various agencies concerned (namely, DID, DOA, FOA,

BPM and MARDI) on a routine basis. This system, together

with the provision of additional personnel, equipment,

vehicles, facilities and training programs forms the basis

of the Integrated Agricultural Services Component.



- 21 -

2. PROGRAM PREPARATION AND FORMULATION

2.01. Project formulation originated in the efforts of the Selangor

Drainage and Irrigation Department to upgrade existing drainage and

irrigation infrastructure (to improve water management) and to promote

agricultural improvement (to increase cropping intensity in padi areas

and to intensify inter-e-ropping and sole-cropping in tree crop areas)

in this major agricultural subregion of the Selangor State. 'Over time,

as long as' development was dependent on routine annual. budget alloca-

tions, it became apparent that only piecemeal engineering solutions

to the re4ion's drainage and irrigation problems were possible and the

various agricultural agencies would have to be involved in an integra-

ted extension effort to upgrade smallholder farm practices in conjunc-

tion with full-scale improvement in agricultural infrastructure. The

preparation of this Project thus involved the long term planning of

irrigation works and regional drainage systems on the engineering side

and concurrently working out a complete operational methodology for

the 'delivery system' for supporting agricultural services among DOA,

DID, FOA, BPM and MARDI.

2.02. The various agencies that are involved directly in the implemen-

tation of the major Project components are the DID, DOA, FOA, BPM,

MARDI and Land Office.a/ While each of these agencies is responsible

for implementing specific activities within its jurisdiction, the res-

ponsibility for coordinating all Project activities lies with the Pro-

ject Management Unit (PMU). The Project as a whole, is guided in its

implementation and particularly on policy matters by a Steering

Committee.

2.03. Besides these project specific activities, the above agencies

are also responsible for the implementation of a range of state-wide

and/or nation-wide programs (of their respective parent agency) in

the Project area. Concurrently, other supporting agricultural deve-

lopment agencies (e.g. LPN, FAMA, RISDA, Veterinary Services Depart-'

2/ - The Land Office was-incorporated as a Project agencyin March 1979.


Northwesl Selangor Project - 1522 MA

-22 -

ment, Fisheries Department,etc.) also operate in the Project area.

There is, thus, an on-going attempt at integrating the activities of

such agencies in the Project area.

2.04. It is important to realise that the Appraisal Report gave a

greater emphasis to the program preparation and formulation of the

infrastructure component compared with the integrated agricultural

supporting services. The infrastructure component should be viewed

as one of the means to achieve the Project targets. An equally im-

portant means to achieve the Project targets, is thrbugh the integ-

rated agricultural supporting services. Thus, an equal if not a

greater emphasis should have been paid to the program preparation

and formulation of the integrated agricultural supporting services.

2.05. The program preparation and formulation of the Project was

based on baseline data and information which lacks accuracy. As a

result some of the targets set, such as infrastructure implementa-

tion schedules, projections on crop yields, farm incomes, etc. are

rather unrealistic and optimistic.

2.06. As a whole, t:he Appraisal Report prepared in 1977 provided a

useful general framework for programing projects and activities, es-

pecially in the early phase of the Project period. Over the years,

more data and information were collected and additional technical

sub-committees were instituted at the Project, District and Area

levels to ensure a more detailed technical planning.



- 23 -

3. IMPLEMENTATION

EFFECTIVEz*ESS

3.01. The implementation of Project programs and activities can be

considered as generally satisfactory and to a large extent had ful-

filled the desired objectives. However, a number of problems did

occur during program implementation.

3.02. The first major problem faced was the staff shortages and in-

experienced staff. It took about 1½ years i.e. from June 1978 through

to December 1979 to get 80% of the established posts filled and when

filled they were more often filled with inexperienced new recruits.

In short, both stiff shortages and inexperienced staff were critical

in the early years of 1978 through to 1980 causing delay in the imple-

mentation of the infrastructure program, which could not be brought

back to schedule and hence resulted in t_me overrun. Similarly, the

staff shortages and inexperienced staff which occurred in June 1978

through to 1980 also affected the implementation schedule of the integ-

rated agricultural supporting services program. This early setback in

the implementation of the integrated agricultural supporting serviles

was, however, brought back to schedule later, when more posts were

filled and staff gained experience.

3.03. Secondly, the Appraisal Report envisaged that the District Land

Offices at Kuala Selangor and Sabak Bernam could cope with the work-

load on land acquisition. The number of lots of land to be acquired

for the Project were 20,000 and it was found out that the 2 District

Land Orfices with their existing staff could not cope up with this

workload. As such, 2 Land Mobile Units had to be requested from the

Federal Department of Land and Mines to carry out land acquisition for

the Project. The Land Mobile Units were Incorporated as a Project

Agency in March 1979. This had caused delay in land acquisition and

thus to some extent affected the infrastructure implementation schedule.

3.04. Thirdly there was the problem of general shortage of 'bakau'

piles of 4-inches diameter. 'Bakau' piles were used for the foundation

of the concrete conduits. The number of 'bakau' piles required was


Northwest Selanoor Project & 1522 MA

- 24 -

1.3 million. This shortage in one way or other affected the implemen-

tation of the infrastructure.

REVISIONS

3.05. The important changes made in the Project scope and design were

the inclusion of 348.2 hectares of land in Ganda Suli in the State of

Perak which is adjacent to the Project area, the increase in width of

access path from the original 1.22 metre (4 ft.) to 1.83 metre (6 ft.),

construction of the additional quarters for PMU's staff and also the

increase in number of Farmers' Development Centres from 10 to 12.

Ganda Suli area, although part of the State of Perak, lies strategically

within the Project area and thus was appropriate to be incorporated

into the Project area. The original width of the access path was too

small and not accessable to most farm machineries whose width is 1.83

metre and above. There was an oversight in the Appraisal for not

providing quarters for PMU's staff and the 2 additional Farmers' Deve-

lopment Centre were required for proper coverage of the Project area.

Detail of changes made in the infrasturcture works is shown in Appendix

II. The changes made in the Project scope and design not only caused

delay but also contributed in some way to the increase in Project cost.

3.06. The procurement of equipment was also revised from US$1.4 million

to US$0.57 million. The main reason for the reduction was that main-

tenance works would be carried out on contract basis. This is in

accordance with the GOM policy on privatisation.

3.07. The Appraisal Report mentioned that there would be 3 Area Farmers'

Organisations in the Project Area. However, the number of Area Farmers'

Organisatiln had been revised to 5, and this revision coincided with

the number of service areas as envisaged in the Appraisal Report.

3.08. The'announcement of the National Agricultural Policy in late 1983

and the release of Mid-Term Review of the Fourth Malaysia Plan in 1984,

shifted the foci of agricultural supporting services program from the

already on-going farmers' groups towards group farming and mini-estate.

In addition, the withdrawal of input subsidies in favour of encouraging



- 25 -

credit utilization by farmers especially as provided by the Agricul-

tural Bank also shifted the foci of agriculture supporting services

program. The above changes also consequently affected training and

education program designed for staff and farmers alike.

IMPLEMENTATION SCHEDULE

3.09. According to the implementation schedule as drawn up in the

Appraisal Report, the implementation of civil works was supposed to

start in January 1977 and completed by December 1982. However, the

Loan Agre ment was only signed on March 8, 1978 and the Project was

only offidially launched on June 6, 1978. As such, the schedule of

iaplement Ltion of civil works was adjusted accordingly to begin in

June 1978 and to complete by December 1983. It is therefore appropri-

ate to consider this date as the commencement of the implementation

schedule of civil works for the Project. The original schedule of

implementation as appeared in the Appraisal Report is in Appendix

Illa, whereas the revised implementation schedule is in Appendix IlIb.

3.10. The completion date for the civil works will be October 1985

when 2 irrigation contracts in Panchang Bedena and Bagan Terap will be

completed. The drainage contracts were completed by April 1985. The

completion date for the Project is therefore delayed by 1 year and 10

months. The actual implementation of civil works is as in Appendix IIIc.

3.11. The main cause of the delay in the implementation of civil

works was mainly due to staff shortages and inexperienced staff which

occurred from 1978 through to 1980. It took nearly 1 years from June

1978 to December 1979 to get 80% of the established posts filled and

when filled, they were more often filled with inexperienced recruits.

As a result, majority of tenders for civil works were only be able to

be called in 1981.

3.12. The implementation of the integrated agricultural services

program started off slowly in the early phase due also to staff short-

ages and inexperienced staff but picked up later and was able to comp-

lete ahead of schedule. The Sekincan technique of padi direct seeding

was introduced to other blocks in 1981. This technique required among

PRoJECT COMPLETION REPORT MAIN REPORT


- 26 -

other things good water distribution and control. As a result, many

problems were faced in water supply, distribution and control. Efforts

were made and still being made to improve the water supply, distribu-

tion and control in the padi areas. On the other hand, in tree crop

areas, especially in acid-sulphate and potential acid sulphate areas,

the main problem faced is the maintenance of adequate water table.

The infrastructure planned for the drainage areas did not cater for

this aspect of water control. The shortcoming however, is being

rectified by building sandbag dams at strategic locations along the

secondary drains to command the required water table.

3.13. The staff shortages and inexperienced staff and the lack of

capacity of the District Land Offices to undertake the land acquisition

work could have been foreseen and avoided. The original time schedule

of the Project was unrealistic in view of the fact that the Loan Agree-

ment was only signed on March 8, 1978. The 5-year project implementa-

tion period is too optimistic for this Project. This is further com-

pounded by an overly optimistic start-up targets. The length of the

project implementation period should therefore be according to the

complexities of each project and should not be stereotyped for all

IADPs.

3.14. The effects of the delay were reflected in the increase in costs

and in the delayed benefits to the farmers. The costs would have been

different if most of the tenders were to be called in 1978/79 and not

in 1981 as in the case of this Project. The benefits to farmers were

also delayed by the time overrun.

3.15. There were no changes in the original procurement plans and also

in the extent of local and foreign procurement. International Compe-

titive Biqdings (ICB) were called for irrigation contracts and Local

Competiti4e Biddings (LCB) for drainage and building contracts. With

the excep ion of one (a Japanese firm),all other bidders for ICB were

local contractors. As such, there was no need to call for ICB and in

future, LCB will be adequate for this type of project.



- 27 -

COSTS

3.16. Thelestimated costs and actual costs of the Project is as in

Table 2.

Table 2 - Estimated And Actual Costs Of The Project

Estimated Costs Cost Revisions A C0515No Items As In Appraisal On 1.12.1979 lli

US $ Million US $ Million us $ Million

1. Padi Irrigation 23.8 48.7 60.72. Tree Crop Drainage 13.2 21.9 17.73. Building & 1.8 2.9 5.8

Facilities4. Equipment 1.4 2.3 0.6**5. Incremental Agri- 1.5 2.3 2.2***

cultural Services6. Physical 5.5 2.5 _

Contigencies7. Price Contigencies 12.8 6.7 -

Total 60.0 87.3 87.0

Notes:-(i) * - 1985 costs are estimates.

(ii) ** - DID US$0.28 million and FOA - US$0.29 millionTotal = US$0.57 million.

(iii) *** - DOA - US$1.65 million and FOA - US$0.50 millionTotal - US$2.15 million.

3.17. Table 2 above clearly shows that there is cost overrun of US$27

(US$87.0 - US$60.0) million or 45% from the Appraisal estimate. However,

the actual costs and the cost revisions as done on December 1, 1979 were

very close. The main increase in cost was in the padi irrigation system.

Appraisal estimates were made in 1977 whereas most tenders for the civil

works were called mainly in 1981 i.e. a difference of 5 years and hence

the increase in bid prices compared with the Appraisal estimates. The

physical and price contigencies were inadequate to cover up this price

increases. The cost overrun was financed by the Malaysian Government.

DISBURSEMENT AND FINANCIAL SOURCES

3.18. The actual cost of the Project is around US$87.0 million. The

World Bank financed US$26.0 million or 29.9% of the Project cost, while

the balance of US$61.0 million or 70.1% was borne by GOM.



- 28 -

3.19. According to the Loan Agreement, the GOM had first to finance

the Project, and later to reimburse from the World Bank. The actual

disbursements made from the World Bank compared with the Appraisal

expectations is shown in Table 3.

Table 3 - Actual Disbursements Compared With

Appraisal Expectatioas - 1979-1983

Expected Accumulated Actual AccumulatedDisbursements As In ActursementsYear Disbursements

Appraisal Re?ort US $ MillionUS $ Million_____ _____

1979 1.7 0.021980 6.4 2.151981 13.3 8.561982 20.6 19.041983 26.0 26.0

3.20. Table 3 above shows that the disbursements were completed on

schedule but did not follow the Appraisal expectations. The disburse-

ments were low in the first 3 years and only caught up with the App-

raisal expectations in 1982 and 1983. The main reason for the diffe-

rence in actual disbursements compared with Appraisal expectations was

as explained earlier due to slow start-up of the Project in years 1978

through to 1981.

PERFORMANCE OF CONTRACTORS, SUPPLIERS AND BORROWER

3.21. Overall, the contractors' performance can be considered as good.

Of the 6 contracts for padi irrigation works, 3 were completed on time,

while the other 3 were extended to between 3 to 6 months due to site

problems. 5 out of the 7 contracts for drainage works were completed

on time, while 2 other contracts were delayed and were extended by 6

months due to land acquisition problems. The offices, quarters, FDC/

FDSc etc. were completed within -he stipulated periods.

3.22. There was no problem in the procurement of equipment, as this

formed a small part of the Project component. The performance of the

suppliers was good.



- 29 -

3.23. In the early phase of the Project period, the technical and

managerial competence of the implementing agencies was rather weak,

but their competence improved with time, as staff strength grew and

the staff gained more experience. Some of them had been taken out

of the Project and emplaced to other newly established IADPs.

3.24. On the whole, the actual operating performance of the Project

was satisfactory. Most managerial and technical problems that occurred

had largely been overcome. The staff of all implementing agencies

(now an experienced lot) were able to work as a team and were confident

of their roles. This, together with the increasing committment from

all levels of staff towards the Project concept (as they get a better

'feel' of things) were major contributors to the optimism of a better

performanc¢ as the Project grows.

I \t'*e


- 31 -

4. FINANCIAL PERFORMANCE

4.01. The GOM always allocated sufficient funds for the Project. In

fact, the GOM had funded the Project well above the Appraisal estimate.

This was due to the fact that the GOM realised that changes in scope

and design together with increases in prices had pushed the Project

cost welA over the Appraisal estimate and in order to ensure the success

of the Prt*ject, the GOM had no qualms in allocating additional fund to

the Projedt.

4.02. The annual Appraisal projections compared with the annual allo-

cation and the actual annual expenditure are as in Table 4.

Table 4 - Annual Appraisal Projections Compared With

Annual Allocation And Actual Annual Expenditure

Annual Appraisal Annual Allocation Actual AnnualYear Projections US $ Mfillion Expenditure

US $ Million US $ Million

1978 3.97 2.35 1.41979 10.87 5.55 2.31980 16.17 12.17 6.21981 15.49 16.44 14.21982 12.63 26.90 26.71983 0.87 16.46 16.41984 - 11.95 11.51985 - 8.42 8.3*

otal 60.0 100.24 87.0

Notes:-

(i) * - 1985 estimates.

4.03. Table 4 above shows that the actual annual allocations deviated

from the Appraisal annual projections. Although the annual allocation

for the first 3 years i.e. 1978 through to 1980 were smaller than the

Appraisal annual projections, this did not affect the project implemen-

tation. In fact, the annual allocation given in 1978 through to 1980

far exceeded the requirement for these years. As mentioned earlier,

the main reason for this occurrence was due to slow start-up in the

early phase of project implementation. The tempo of implementation

started only to pick up in 1980 and peaked in 1982.



- 32 -

4.04. As also mentioned previously, funds were not a problem for this

Project. In fact, funds were made available to the Project according

to its capacity in implementing its program. However, it is pertinent

to point out that the implementation schedule of civil works was too

optimistic,. The implementation schedule for civil works drawn up for

this type bf project should take into account all the constraints

particular ly staffing problems, capability and capacity of officers,

etc. so that a more realistic and practical schedule could be drawn up.

The experience gained in this Project should therefore be used in

planning future IADPs.



- 33 -

5. INSTITUTIONAL PERFORMANCE AND DEVELOPMENT

5.01. Generally the institutional performance and development conformed

to as in the Appraisal Report. Any weakness found during the course of

project implementation were corrected and strengthened from time to time.

By this way the Project Management has strived to achieve the institu-

tional objectives and has met with some degree of success.

MANAGEMENT AND ORGANISATIONAL EFFECTTVENESS

5.02. Management is perhaps the most critical element affecting project

implementation. Not withstanding the type of organisation and manage-

ment system, the success or failure of any project also depends on the

quality, experience, personality and competence of the Project Director

and key personnel. Equally important is continuity of staff i.e. to

keep such staff in post for the Project period which can be done by

introducing promotion prospects for successful performers.

5.03. The type of organisation. and management system practised in

the Project can be called the coordinative type as opposed to autho-

ritative type (as in MADA or KADA which operate as independent Autho-

rities). In order to ensure efficient coordination in the implemen-

tation of the Project, the overall management is organised along the

lines as per Appendix IVa which is self-explanatory. The apparently

overt reliance on committees and meetings as shown on the chart is

conditioned by the fact that there is little integration of management

in the Project (unlike MADA or KADA). Consequently, the present manage-

ment organisation is a 'second-best approach' and is constructed so as

to afford a somewhat 'rudimentary' management system which nevertheless

is vital to the proper implementation of the Project. The implementa-

tion record of the Project would certainly improve if the management

organisation of the Project were to be of the authoricative type.

5.04. The management organisation as set up, helped a long way in

ensuring smooth implementation of the Project. There were little

changes made to the management organisation set-up during the course

of Project implementation except in the re-naming of certain committees



- 34 -

and co-opting more agencies to be members of various committees and

meetings (and vice-versa) when the need arises, with the aim of con-

tinued cooperation in the implementation of the Project. The renaming

of some of the committees is to be in accordance with the requirement

of the Ministry of Agriculture Malaysia. The latest management set-up

of the Project is as in Appendix IVb.

GROWTH

5.05. In order for the Project to be implemented, additional staff,

office space, stores, drying yards atd staff houses were required by

the implementing agencies. There was a growth in the number of staff

of all implementing agencies including the PMU. The staff growth in

all categories for DID was 204 (at its peak), DOA was 49, PMU was 38

and FOA was 29. The office space for all implementing agencies was

housed under one roof. The headquarters of the Project is situated

in Kuala Selangor and one branch office in Sungai Besar. There were

1 FDC and 13. FDSc; all are strategically located in the Project area

to serve the farmers. Each FDC/FDSc complex normally consists of

office space, stores, drying yard and staff quarters for all imple-

menting agencies. There is a total of 143 staff quarters. .

5.06. The agencies involved (including those not financed by the Pro-

ject) in project implementation and their respective roles are summa-

rised below:-

(a) PMU - Besides providing close and continuos liaison between

the implementing agencies, the PMU also assists the imple-

menting agencies in the planning and implementation of the

integrated agricultural services component and the planning

and synchronisation of land acquisition and alienation with

all major construction works; the monitoring and evaluation

of the overall progress of the Project; and acts as the

secretariat to the Steering Committee.

(b) DID - Besides the design and construction of all irrigation,

drainage and civil works, DID is also responsible for the

operation and maintenance of the new systems. DID and DOA

jointly undertake the organisation of farmers into water-



- 35 -

user groups and train them in the proper operation of the

new systems according to Project concepts, adherence to

planting schedules and proper water management practices.

(co DOA - In conjunction with the organisation of farmers Into

common farmer groups (i.e. the delivery system for integ-

rated agricultural services), DOA operationalises the T&V

system of extension in the entire Project area and through

such a system introduce improved agronomic practices and

enhanced farm advisory services necessary to achieve the

expected yield increases (i.e. Project targets). DOA pr4-

vides pest monitoring and surveillance and crop prot,ctioit

services; soil analytical services; farm mechanisation

training; and supply of improved seeds and planting

materials (in collaboration with MARDI and FOA) in support

of the integrated delivery system. DOA is also responsible

for ensuring the liaison and close cooperation among other

agencies in implementing the integrated agricultural

services component in the padi and tree crop areas.

(d) FOA - FOA is responsible for the supply of inputs; mechani-

sation service, local marketing (transport, storage and

processing) and the increased participation of farmers in

agribusiness activities (including the rehabilitation of

cooperative rice mills) related to the production of the

respective crops in the Project area. FOA will also re-

orientate and channel its established and new activities

especially through the new delivery system of common farmer

groups.

(e) BPM - BPM is responsible for providing its range of credit

facilities especially through the common farmer group set-up.

Most importantly, BPM will advice and supervise the farmers

in the proper utilisation of the different types of credit

facilities made available to them.

PROJECT COMPLETION REPORT MAlN REPORT


36 -

(f) MARDI - Through its basic and applied research programs,

MARDI will ensure a continuos flow of appropriate techno-

logy (including improved varieties) necessary for effective

extension and ultimate achievement of Project targets.

MARDI will also work closely with the other agencies

(particularly DOA) in setting up a network of demonstration

plots and investigate optimal enterprise mixes (for multi-

enterprise farms) under varying conditions in the Project

area.

(g) Land Office - The major role of the Land Office is not only

in speeding up land acquisition but more importantly in

synchronising its work and priorities with those of DID's

construction works scheduling as and when 'unforeseen cir-

cumstances' arise.-! This role is most vital to the time-

liness of project implementation in view of the amount of

land (particularly number of lots) that needs to be acquired

and the somewhat over optimism in the time scheduling of

the construction works.

5.07. It is recognised that simultaneous to the efforts of the above

stated agencies, the support of other agencies and local institutions

must be solicited in order to realise the stated Project objectives,

viz.,:-

(a) LPN's and FAMA's support in the marketing of the major crops;

(b) Veterinary and Fisheries Department's (and to a certain

extent, RISDA) support in the evolution of better cropping

systems (multienterprise farms);

(c) District Offices' and Village Development And Security

Committees' support in resolving and reconciling social

conflicts and problems.

5.08. The list would grow with the Project. Accordingly, represen-

3/ - Such 'unforeseen circumstances' have proved to be a norm inalmost all major infrastructural projects and similarly soin the case of this Project.



- 37 -

tatives of these agencies will be co-opted into the various commit-

tees and meetings (and vice versa) when the need arises, with the aim

of continued cooperation in the implementation of the Project.

STAFF RECRUITMENT, TRAINING AND DEVELOPMENT

5.09. Project programs and activities were carried out by the imple-

menting agencies, (coordinated by the PMU) which had to make bids to

the Central Agencies every year for the required posts. When the

posts were established, each implementing agency had to fill the

posts. The posts established and filled for the period from 1978 to

1985 are as in Table 5.

Table 5 - Posts Established And Filled (All Categories)

For The Period From 1978 To 1985

sots End End End End End End End Endpprai- 1978 1979 1980 1981 1982 1983 1984 1985

kgenc al Re- o. 01 No. Of No. Of No. Of No. Of No. Of No. Of No. Ofire- Posts Posts Posts Posts Posts Posts Posts Postsnent HEF I E I F EF%FE I F E F E I EF E I F EFF

PMU 1 9 11 11 0 27 259 3 2 3i 32 100 35 32)l 38 3 2

DID 289 1 5 2 1979 20018 0417 7204171 84350 79101 9 91

DOA 58 21S 43 37 1 339 45 3 47 4 4 46 49 4 44_ 4 46

FOA 48 n nn I n 1 1 _ 12 1 12 1 2 322 2279

otal 396 117 612288 5 95 25 8403 1817

Notes:-(i) E Established, F - Filled, %F - % Filled and n - Nill

(ii) * - Excluding the Operation and Maintenance Staff.

5010. The staff requirement of the Project was essentially to top up

the existing staff of the implementing agencies in the Project area

to strengthen and consolidate themselves for Project implementation.

Table 5 shows that the staff requirement as envisaged in the Appraisal

Report was 396 posts, and in 1983 at the peak of project implementation

314 posts were established i.e. 79% of the Appraisal requirement. The

number of posts established by the GOM for the Project was adequate

for its smooth implementation. The performance of the Project would

PROJECT COMPLET±ON REPORT MAIN REPORT


- 38 -

have been better if all the posts that were established were filled.

Further, it is important to note that the acute staff shortages and

inexperienced staff from 1978 through to 1981 contributed to the

initial 1D year delay in Project implementation.

5.11. It is pertinent to note here that the Appraisal Report made no

provision of staff requirement for the PMU, except to say that there

should be a Project Director and he "would have a small staff to assist"4/in budgeting, procurement and disbursement matters".4 The Project

Director and his staff play a very crucial role for smooth project

implementation. Therefore, it is very important that adequate staff

provision be made for the PMU from the very beginning.

5.12. Acute staff *shortages occurred at the initial period of project

implementation. Table 5 clearly shows that acute staff shortages

occurred in this Project in the initial period from 1978 through to

1980. It seems that the parent agencies required some time to react

and to fill the posts created in the Project. This weakness had to be

overcome in the future IADPs.

5.13. The key personnel of the Project were experienced officers.

However, the recruits to the Project such as Engineers, Agricultural

Officers, Technical Assistants, Agricultural Assistants, Technicians,

Cletical staff, etc. were raw. Generally, they were fresh graduates

of universities, technical institutes, etc. At the beginning they

were a burden to the Project as they had to be trained and guided.

They had to undergo on-the-job training and attend either in-house

courses or other organised courses. It took about 1½-k years for

these staff to learn their trade and to contribute positively to the

implementation of the Project. The performance of the Project would

have been better if most of the staff were experienced.

5.14. Qualified and experienced Project Director and Component Heads

of the Project are the key to successful project implementation. They

4/ - Appraijsal Report, page 20



- 39 -

should be carefully selected and placed in their jobs covering

the span of the Project period. Promotion prospects and other

incentives, of course, have to be given to them. It is inte-

resting to note that in this Project, except for the Project

Director, there had been frequent changes in the Component

Heads; so far there had been 3 Component Heads each for DID,

DOA, FOA and MARDI and 4 for BPM. In the lower categories of

staff, the turnover rate was comparatively low.

AGRICULTURAL IMPACTS ON THE BENEFICIARIES

5.15. The impacts on the beneficiaries were varied and many.

These various impacts will be discussed under the following

sub-headings:-

(a) Yield - There is no doubt that there had been

increases in the yield of various crops except

coffee in the Project area. For most of the

crops except coconut,the projected yields were

always higher compared to the actual yields

achieved by smallholders. This may be due to

the lack in accuracy of the data used for the

projection of the yields especially for cocoa,

oil-palm, rubber and coffee. However, the yields

achieved for padi show a close resemblance to the

projected one, though this could not be stabi-

lized from season to season. As for coffee, the

downward trend in the yield achieved is due to

the declining interest of farmers for this crop.

Yield achievement for various crops except coffee

are expected to show a better performance in the

future. Table 6 shows the yield for various

crops up to 1984.

PROJECT Ca.VPLETION REPORT MAIN REPORT


- 40-

Table 6 - Average Crop Yield In Northwest Selangor

Project From 1978 To 1984 - Kilograms/Hectare

Year Yield (Kg./Ha.) In

Crop \ 1978 1979 1980 1981 1982 1983 1984

Padi * 3,356 3,331 3,381 2,835 3,681 2,362 3,3011st. Season (3,500) (3,540) (3,700) (3,900) (4,100) (4,330) (4,460)

Padi * 3,513 3,375 3,865 4,394 3,119 2,830 3,2002nd. Season (3,000) (3,030) (3,100) (3,300) (3,600) (3,970) (4,190)

Coconut ** n.a. n.a. n.a. n.a. 1,265 1,331 847(Copra) (667) (692) (741) (790) (840) (865) (865)

Cocoa ** n.a. n.a. n.a. n.a. 313 275 347(Dry Bean) (224) (336) (392) (448) (504) (559) (559)

Oil-Palm ** n.a. n.a. n.a. n.a. 5,290 8,820 10,657(FFB) (12,350)(12,350)(12,844)(13,338)(14,079)(14,820) (14,820)

Rubber ** n.a. n.a. n.a. n.a. 748 771 676(Latex) (783) (783) (817) (862) (906) (951) (951)

Coffee ** n.a. n.a. n.a. n.a. 3,596 2,873 1,859(Berries) (5,236) (5,236) (5,891) (6,546) (7,200) (7,855) (7,855)

Notes:-

(i) * - Data from 1978 to 1982 were from the Crop CuttingTest of The Department of Statistics, while thatfrom 1983 to 1984 were from the surveys carriedout by the PMU.

(ii) ** - Data from the surveys carried out by the PMU.

(iii) n.a. not available.

(iv) Figures in parenthesis are Appraisal Report's projections.

(b) Income - The Appraisal income estimates were not that accu-

rate as these estimates did not reflect in the prevailing

incomes as found out in the yearly surveys carried out by

the Project Management. However, it is suffice to say

that there have been increases in incomes of the Project

farmers. These increases in incomes could be attributed to

a number of factors, among which are increases in production,

subsidies by the COM, changes in prices of commodities, avai-

labilities of off-farm jobs, etc. However, it is not



- 41 -

possible at this juncture to apportion values to these

various variables. It is suffice to emphasise here that

there had been increases in incomes of farmers in the

Project and these incomes have the potential to be further

increased in the near future. The increase in incomes

among sole crop farmers in the Project area is as shown in

Table 7.

Table 7 - Incomes Of Farmers In The Project Area

\ ~~~~Average InicomePer Capita Per Annum

Of < Sppraisal Report 1983198$4Farmers \Estimates US$

[Padi 235 213 322

Cocoa/Coconut ) 407 391

Rubber 392 330

Oil-Palm 150 421 427

Coffee 232 347

Weighted n.a. 411 359Average_____ ___

Notes:-

(i) 1983 and 1984 figures fromsurveys carried out by the PMU.

(ii) n.a. = not available.

(c) Poverty Redressal - The surveys carried out by the Project

Management shows that there have been a decrease in absoulue

poverty in the Project area. At Appraisal (1977) the pover-

ty rate in the Project area was 65% (poverty line income in

1977 was US$207 per capita per annum) compared with 50% in

1983 and 56% in 1984 (poverty line income in 1983/84 was

US$329 per capita per annum). As there is potential for

further increasing productivity and incomes of Project

farmers, there is also no doubt that poverty in the Project

area could further be reduced. Poverty reduction among sole

crop farmers in the Project area is as in Table 8.



- 42

Table 8 - State Of Poverty In The Project Area

Poverty Appraisal ReportRate Estimate 1983 1984

rype 1977

_ _

Padi n.a. 65 67

Cocoa/Coconut n.a. 38 55

Rubber n.a. 48 56

Oil-Palm n.a. 53 40

Coffee n.a. 65 67

Weighted 65 50 56Average __.__

Notes:-

(i) 1983 and 1984 figures fromsurveys carried out by the PMU.

(ii) n.a. - not available.

(d) Cropping Pattern - There was no plan in the Appraisal Report

to change the cropping pattern of smallholders in the Project

area. The padi area remains unchange, except that the crop-

ping intensity had increased from 170% in 1977 to 180% in

1984. The cropping intensity for padi would be increased

further with the completion of the new irrigation infrastruc-

ture and its usage by farmers. The coconut area also remained

basically unchanged. Replanting of old coconuts with MAWA

variety was negligible. As for other crops, there was ten-

dency especially among farmers in Kuala Selangor District

to change from rubber and coffee to oil-palm because of

it's greater economic prospects. Cocoa intercropping in

coconut is popular among smallholders and had increased

tremendously from 9,260 hectares in 1977 to 14,261 hectares

in 1984. The changes in cropping pattern is shown in

Appendix V.

(e) Mechanisation - Better farm road system and improved irri-

gation and drainage network provided by the Project in the

padi area had made mechanisation possible in the hitherto


Northwest Selangor Project - 1522 NA

- 43 -

unaccessable and deep areas. In addition, mechanibdLon

saves time and labour costs and thus becomes a profitable

proposition. As a result, mechanisation in the padi area

has become widespread. Approximately 80% of farm operations

in the padi area were mechanised. As for the tree crop, the

land preparation work for new plantings were mechanised but

other work like maintenance and harvesting were still manual-

ly done.

(f) Water Management - With the provision of the new irrigation

and drainage infrastructure, there is a need for the farmers

to manage their water wisely. Good water management is

essential in order to fully realise Project benefits. To

achieve ihis, water management committees were set up at

various levela. Presently about 90% of the padi fields had

the required in-field drains and bunds but these structures

were not adequately maintained by the farmers. Land levelling

which is essential for good water management, is estimated

to cover only about 47% of the padi area. Land levelling

progresses relatively slow as this operation is costly and

also there is lack of suitable equipment for problem soils.

Furthermore, land levelling operations had to be carried out

for more than one season before any significant effects could

be realised. Water management is an on-going program in the

Project and would be further strengthened.

(g) Farmers' Attitudes - There had been changes in farmers'

attitudes in the Project area. Among the important changes

were using of improved and recommended padi varieties,

changing from traditional to direct seeding method of padi

cultivation, adopting mature-budding technique to improve

cocoa stand, greater use of chemicals and participation in

pest management programs and greater utilisation of agricul-

tural credits. More than 90% of the farmers were using

improved and recommended padi varieties compared to less

than 50% before the Project and approximately 60% of the

adi area were under direct seeding as compared to less than

2 before the Project. The farmers also showed readiness to



- 44 -

follow padi planting schedules as laid dcwn by the Project Manage-

ment. The mature-budding technique to improve the cocoa stand was

popular among the farmers. Mini estate and joint farming concepts

had also been well recieved by the Project farmers as evidenced by

their participation in 2 mini estate projects and several joint

farming projects. All in all, the farmers in the Project area are

generally receptive to changes.

RATE OF RETURN

5.16. The overall economic rate of return for the Project as estimated

in the Appraisal Report is 21%. The econiomic rate of return for the padi

irrigation area is 19%, whereas for the tree crop drainage area is 22Z

(15% for the smalltolder sector and 30% for the estate sector).

5.17. During the course of Project implementation, there had been a num-

ber of changes. Among the major changes are the increase in Project costs

from the estimated US$60 million to US$87 million (an increase of 45%

from the Appraisal estimate) and the rapid transfer of technology and

management know-how to the farmers and also their rapid adoption. The

cost of the padi irrigation component increased from the estimated US$23.8

million to US$60.7 million (or 155%) while the cost of the tree crop drai-

nage component increased from the estimated US$13.2 million to US$17.7

million (or 34%). Based on these major changes, the revised overall eco-

nomic rate of return is calculated to be 20%. The economic rate of return

for the padi irrigation area is 2%, whereas for the tree crop drainage

area is 64% (56% for the smallholder sector and 81% for the estate sector).

The low economic rate of return for the padi irrigation area is mainly due

to the very high investment cost (US$60.7 million) and 1 years time over-

run. On the other hand, the high economic rate of return for the tree

crop drainige area are due mainly to low investment cost (US$17.7 million),

availability of high yielding oil palm hybrids and cocoa clones and also

management factors.

SPECIAL ISSUES5/5.18. All the various recommendations put forth in the Appraisal Report-5

had been met. The Tanjong Karang swamp had been gazetted as a forest

5/ - Appraisal Report, page 29



- 45 -

reserve. The Selangor State Government still collects irrigation and

drainage rates from land owners. However, no revisions had yet been made

to these rates. Other issues to be discussed are as follbws:-

(a) Research And Extension Relationship - There is close relation-

ship between research and extension in the Project area. This

had come about through the management organisation system as

explained previously and as per charts in Appendices IVa and

IVb. Apart from the various committees set up in-the manage-

*ment organisation system, there were other sub-committees set

up at Project level to foster close relationship between

research and extension. These sub-committees include transfer

of technology committee, DOA-MARDI committee on pest control,

supply of cocoa planting materials committee, fertilizer appli-

cation rates committee, post-harvest losses committee, mini

estates and joint farming committees and various other sub-

committees to foster close inter-agency cooperation.

(b) Lack Of Authority And Proper Job Description Of Project

Director - The coordinative management organisation system as

practised in the Project depends very much on committees'

decisions and personalities of various officers for smooth

project implementation. There is lack of authority on the part

of the Project Director in this type of management organisation

system. This lack of authority is further compounded by the

lack of a proper job description for Project Director and the

ranking of Project Director vis-a-vis Component Heads of line

agencies, which in turn complicates the relationship between

Project Director and line agencies. To summarise, this type

of management organisation subjects line agencies to the super-

vision of an operational head (Project Director) and the control

to its functional head (parent agency) and in such a situation,

line agencies would tend to give priority to their parent

agency when their services are needed both at the same time.

Further, this type of organisation management raises problems

in the day to day running of the Project, such as inadequate

cooperation being given to Project Director and lack of team

work or low priority given to the Project. To overcome this,



- 46 -

it is suggested that:-

(M) The Project Director should be given legitimate authority

by emplacing line agencies directly under the Project

Director. This would enable him to have full and direct

control of resources, as a clear line of hierarchical

structure exists and he functions as a manager rather than

a coordinator,

OR

(ii) The Project Director should be given authority other than

by legitimate authority i.e. by strengthening the present

management system. This can be done by having a proper

job discription for Project Director, raising his grade,

giving management training, extending Project Director's

function to the grassroot level, etc.

Off the two suggestions above, the former one merits special

consideration and should be implemented in new IADPs if project

performance tecord are to be improved.

(c) Form Of Orga4nisation After Project Completion - Full benefits

of the Project would only be obtained years after the Project

completion. Therefore, in order to reap the full benefits from

the implementation of this Project, the existing organisation

should be maintained and strengthened to run the Project.

(d) GRP Conduits - This type of canal structure was introduced in

the Project area in Sawah Sempadan and Sungai Nipah in 1977.

It was found that the performance of the GRP conduits was not

as expected. The condition of the conduits deteriorated after

3 years of utilization and this is due generally to:-

(i) The overall structural strength of the conduit was unable

to withstand the constant weight and vibrationary impact

of the water, especially in the larger sections. This

factor was compounded by the deterioration of the GRP resin

including the wooden framework under intense exposure to

sunlight;

(ii) The fragility of the GRP conduits make it very vulnerable

to breakages and damages by external factors such as fire,

machineries, human vandalism, etc.


Northwest Selangor Project - 1522 MA- 47-

With this experience, it is suggested that in the future, GRP

conduits should not be used anymore for canals or other similar

purposes.

(e) Environmental Effects - The Project has reduced the frequent

occurrence of floods in the area. This is evidenced by .the

lesser number of yearly complaints recieved compared with

previous years. However, due to the more efficient drainage

system, there is tendency of overdrainage in some'areas re-

sulting in poor crop growth, which become more apparent in

acid sulphate areas. Coastal protection works had contributed

in maintaining the environment and habitat of the coastal

areas.

CHANGES IN REPEATER PROJECT

5.19. Many lessons can be learned from this Project. As has been men-

tioned earlier, this Project is geared more towards infrastructure deve-

lopment as evidenced by more than 95% of the fund was allocated for this

component. The agricultural supporting services was allocated approxi-

mately the other 5% of the fund. Therefore, a more balanced program

between infrastructure and agricultural/human development should have

been drawn, up for this type of project in order to tap the maximum bene-

fits from Lts implementation. As such, more detailed planning should be

carried out for agricultural/human development programs so that more such

programs could be included in the Project.

5.20. The schedule for infrastructure implementation for this Project

is very optimistic. This is further compounded by an overly optimistic

project start-up targets. The disbursement schedule which is closely

tied up with the infrastructure implementation schedule, also becomes

optimistic. To overcome such problems, a more realistic implementation

schedule should be worked out which would improve project implementation

record.

5.21. The type of management organisation system set up for any project

of this kind is one of the critical elements affecting project implemen-

tation. Qualified and experienced Project Director and key personnel



- 48 -

are also the key to successful project implementation. The management

organisati: n of the Project and the selection procedures for Project

Director a d key personnel should therefore be reviewed and improved. An

effective uanasgemeat organisation system, with qualified and experienced

Project Director and key personnel would no doubt improve project imple-

mentation record.

5.22. The initial implementation of this Project has been affected by

staff shortages and inexperienced staff. Although staff shortages have

been 'overcome' (that is total requirements stipulated in the Appraisal

Report have been largely met) the quality and experience is thin. The

implementation record of the Project would certainly improve if there

were no staff shortages and the staff were experienced.

COMMENT ON THE PERFORMANCE OF WORLD BANK

5.23. In the early phase of project implementation, the Bank's Super-

vision Mission made bi-yearly visits to the Project. However, this was

reduced to once a year in later years. This is a good arrangement as it

is in the early phase of project implementation that the Project Manage-

ment needs more guidance and advice. In fact, the more frequent visits

the Bank's Supervision Mission makes to the Project in early phase of

projeqt implementation, the more beneficial it will be to the Project.

5.24. The Bank's Supervision Mission had gone a good job but it could

have done better if all of the Mission's members were to consist of highly

qualified and experienced personnel with pleasant personalities. Past

experiences have shown that a few Mission team members could not contri-

bute significantly towards the Project. Therefore, if the Bank's Super-

vision Mission want to do an excellent job, the members of the Mission

should at all times be consisted of staff who are highly qualified,

experienced and with pleasant personalities. Equally important here is

the continuity of the members of the Missions as there is tendency for

the Bank to change the members of the Mission team too frequently.



- 49 -

6. CONCLUSION

6.01. The overall performance of the Project so far is satisfactory

considering the host of problems faced initially. The initial slide

or delay in the implementation of irrigation, drainage and civil works

had been arrested and present expectations indicate that all major

construction would be completed by October, 1985.

6.02. The initial implementation of the Project has been affected

by staff shortages and inexperienced staff. Although staff shortages

have been "overcome" later, the quality and experience is thin. These

problems must be recognised and overcome in future projects if the

project records were to be improved.

6.03. The infrastructure implementation schedule of 5 years set for

the Project is very optimistic. This is compounded by an also overly

optimistic start-up targets. For a project of this nature and size,

such schedule and targets are unrealistic. As such, project schedule

and start-up targets should be more realistic and achievable..

6.04. This Project is geared towards infrastructure development as

evidenced by more than 95% of the fund was allocated for the construc-

tion of the infrastructure. On the other hand the agricultural suppor-

ting services were allocated approximately the other 5% of the fund.

A more balanced program should have been planned for this Project

and in this case to include more agricultural/human development

elements.

6.05. Management organisation set up for the Project is of the

coordinative type. This type of management organisation placed a

heavy reliance on committees and meetings and thus present many

weaknesses. If this system is to be maintained, it has to be stream-

lined and strengthened.

. PROJECT COMPLETION REPORT MAIN REPORT


- 50 -

6.06. There had been increases in yield of crops and income of

Project farmers. Poverty rate among Project farmers had been reduced

from 65% in 1977 to 50% in 1983 and 56% in 1984. Farmers were

trained and mobilised to farm their holdings in a more effective and

economical ways. Better showings are still to come. Project benefit

can still be expected to be reaped well after year 2000.

PROJECT COMPLETION REPORT APPENDIX II


- 51 -

QUANTITY AND COST CHANGES IN INFRASTRUCTURE WORKS

Appraisal Report ActualNo. Item Estimate (1977) (1985)

____________________ Quantity Cost US$Mill. Quantity 'ost US$Mill.

1. Padi Irrigation

Land Acquisition 72 ha 0.29 182 ha 2.20Headworks Improvement 100 % 0.20 100 % 0.04Main Canal and FeederCanal Improvement 78 km 0.50 44 km 2.03Distributary Canal andStructural TertiaryCanal Construction 490 km 16.92 432 km 37.25Drain Construction 158 km 2.59 264 km 0.86Roads and bridges 730 km 1.54 555 km 1.62Engineering andSupervision Lump sum 1.74 Lump sum 0.11Others - - Lump sum 16.61Area Served 20,000 ha - 19,641 ha -


2. Tree Crop Drainage

Land Acquisition - - 158.7 ha 1.92

Coastal/river bunds 270 km 0.64 141 km 0.85Tidal Control gates 30 No 1.93 28 No 3.40

Drain Construction 2,450 km 6.32 836 km 2.47Roads and bridges 1,090 km 3.06 476 km/163 Nc 2.15Pump Station 1 No 0.27 _ -

Engineering andSupervision Lump sum 0.98 Lump sum 0.43Others - - Lump sum 6.47

Area served 77,000 ha - 80,255 ha -

Subtotal 13.2 17.69

3. Buildings and Facilities

Project Offices 2 No 0.16 2 No 0.54

Staff Quarters 107 No 0.96 143 No 2.58Farmers' DevelopmentCentres 10 No 0.57 12 No 1.61Land Acquisition - - 15.4 ha 0.77

Engineering andSupervision Lump sum 0.14 Lump sum 0.32

Subtotal 1.83 5.82

4. Equipment

For DID & FOA Lump sum 1.4 Lump sum 0.57

5. Incremental Agri-cultural Services Lump sum 1.5 Lump sum 2.20

6. Contigencies Lump sum 18.25 - -

Grand Total 60.0 87.0

NORTHWEST SELANGOR INTEGRATED AGRICULTURAL DEVELOPMENT PROJECT APPRAISAL REPORTSchedule of Implementation of Civil Works

PARTICULARS ACTIVITY 1977 1978 1979 1980 1981 1982SABAK BERNAM PLANNING 198

'-4 DRAINAGE WORKS SURVEYS I _____X LAND ACQUISITION

BLOCK I DESIGN TONTRACT TENDER EVALUATION

z OONSTRUCT~~~~~ION*_ _< PLANN~~~~~~ING . _.

BLOCK II *i LNNIRGEVALUATION

iURVEYS

BLOCK III ACQUISITION

KUALA SELANGOR PLANNINGDRAINAGE WORKS URD ACQUISITION

BLOCK I DESIGN_ _K CONTRACT TENDER EVALUATION________ _ CONSTRUJCTION - =. ,== -

RVYQISITION--BLOCK II ISEIG m

ONTRACT ENDER EVALUATION -__ _ _ _ __ _ _ _ OONSTRUCTION_ _ _ _ __ _ _ _ _

JQISITIONLn BLCKIII

4 .EVALUATION

4i TANJONG KARANGE-4 rUR @ rIRRIGATION WORS ACQUISITION

O IRRIGATION FACILITIE B ETW5DER EVALUATION

RENOVATION OF MAIN LANNING

O WOK URVY1UIITION-D AN_.___ iLARyRDIDS ~~~~~~ EVALUATION

COASTAL BELTo a~ DRkIGE WORKS ISSTION

EVALUATION

S X ISITION

ONTACTTENEREVALUATION

NORTHWEST SELANGOR INTEGRATED AGRICUL rURAL DEVELOPMENT PROJECT FIRS ESchedule of Implementatic:. of Civil Works

_A__R____ _____RS ACTIVITY 1978 1979 1980 1981 1982 1933ffi SALA;::F.R::SPLAN^NII;G_.

C Rl';S- W,:SISURVEYS I _-_

x.. LWLND ACQUISITIOK -CONTRACT TENDER EVALUATION

3___._______________ TSTRUCTION4 _

E PLANNING _.

E-CLh QU}SITION'

ER EVALUATION

SURVEYS EAUTO3Lr II tLAND ACQUISITION

"~LOCK DESIG

ONTAC 1_1ENDER EVALUATION

. ['wA;N S_};G.^R PLP:SIN _ _ .- -*sF g 4,1 aLOCK: A DESIGN | ....e ; ~~~~~wpx8AuISiNG i _I Trji BLOC': I DESIGN Q ..

NTRACT TENDER EVALUATION

BLOCX> III f QfISITION IN EER EYALUATION _

TA-flJO!:G KARANG

t . IRR:GsT:Z:: WCtrS L ADAQ'J;SITION . ___. 2 O IRR-GAT:O.': F;A:LITIE EVAR EVALUATION -r

., ffi RE!OVATION OF %A.1 MG_0 2. WTiKSJDRAL S CE S, . ._ 1 IT

ADS AND ANCIEALUTION_ _

CCASTAL EL-r ___ J -__,6 | ; |DRAINAkGE WVRKS ~ XDAQISITICt rl -_--o _:_-

_____|___|_*_*___ AYStG D w ER EVALUATION

2~~~4 -r' 92 I> .t, F ISMO:N11

TENDER EVALUATION | _ -_ _ -

NORTHWEST SEIANGO INEGRATED AGRICULTURAL DEVEIOP)in P.R0CSchedule of Imlementation of Civil Works

PARTICULARS IVITY 1979 1979 1980 1981 1982 1983 1984 1983

DRAINAGE WORKS SURVEYSACQUISITION

BLOCK I SIGN TEER EVAUTON

ONTRACT TENDER EVALUATIO.

0. IACQUISITION

BLOCK III

BLOCK III J~~jDEa EVALUATION . 1 _ .

KUALA SELANGOR PLNNING . .DRAINAGE WORKS ISITION

BLOC. I ESIGN T B _|IOrRACr TENDER EVALUATION

______ONSTRUCTION _____ _________BLOCKI QG$UISITION -

I ESIGN~~~[I,ER ~EVALUATION

BLOCK III G~USTOn BOCAIICTBDER EVALUATICN

TANJONG KARANG

Ej DIRRIGATION WORKSIS__IRRIGATZON FACILITI T 1 jDREVALUATION

0. 3*RENOVATION OF MAIN TANNING

CANAL ST UCTR, ISITION0 0 DRINA.ECWRWORKS DANCI EVALUATION

t > |COASTAL BELT TANNING

8 4 | DRAINAGE WORKS ISITION

F O | EONTRACT TBNDBR ~EVALUATIONI

ESIi GN8ISITION

XX*RACT ~TENDER EVALUATION INTRCTTNRV.ION, '

PROJECT COMPLETION REPORT APPENDIX IVa


- 55 -

MANAGEMENT ORGANISATION OF THE PROJECT

- BEGINNING OF THE PROJECT

Meets once every 2-3 months.---- ----- STEERING COMMITTEEHead/Representatives of Federal Chairman:and State agencies attend. Secretary General, MOA

Selangor State Secretary

Meets monthly.… ---------------_-________ IMPLEMENTATION COMMITTEEAll Heads of implementing Chairman:agencies attend.Chimnagencies attend. j Project Manager

Meets monthly. ---- Implementation Committee on Implementation Committee onAll district level Integrated Agricultural Integrated Agriculturalofficers and sercive Services for Kuala Selangor Services for Sabak Bernamarea supervisor of - District Districtimplementing agencies Chairman: Chairman:attend. Deputy Project Manager Deputy Project Manager

Meets biweekly. --------- Biweekly * iweeklyAll service area Meeting for eeting forsupervisors and Supervisors & upervisors &field officers field Officer ield Officerof implementing in Service in Serviceagencies attend. Area I rea II Area III Area IV Area V

Chairman: ** hairman:Agriculture gricultui:eAssistant Asistan'.

Agriculture ---- …- Common Com moTechnician meets Farmer Gr JFarbiweekly with farmers;other members of fieldteam attends once amonth.

Notes:-(i) * - There is a total of 5 service areas in the entire

Project area.

(ii) ** - Responsibility is delegated to Service AreaAgriculture Assistant by Project Management.

(iii) *** - There is a total of 6Q5 common farmer groupsfor the entire Project area.

PROJECT COMPLETION REPORT APPENDIX Ivb


- 56 -

MANAGEMENT ORGANISATION OF THE PROJECT

- END OF THE PROJECT

Meets once in every 6 months. --- STEERING COMMITTEEHead/Representatives of Federal and - Chairman:State agencies attend. Secretary General, MOA

Selangor State Secretary

Meets monthly. All Heads -------------- IMPLEMENTATION COMMITTEEof implementing agencies Chairman:attend. Project Director

Meets monthly. All ------ DICPLC* K.SELANGOR DICPLC* SABAK BERNAMdistrict level officers airman: Chairman:and service area super- Deputy Project Director Deputy Project Directorvisors of implementingagencies attend.

Meets biweekly in --- AICPLC** AICPLC** AICPLC** AICPLC** AICPLC**padi areas and SABAK BERNAH SABAK BERNAM SABAK BERNAN K.SELANGOR K.SELANGORmonthly in tree NORTH CENTRAL SOUTH NORTH SOUTHcrop areas. All ChairmaL.: Chairman: Chairman: Chairman: Chairman:area supervisors Area Area Area Area Areaand field officers Agricultural gricultural Agricultural Aricultural Ariculturaof implementing Assistant Assistant Assistant Assistant Assistantagencies attend.

Agricultural Technicians - 605 Common Pmeets biweekly monthly Farmer s Groupwith farmers; othermembers of field teamattends once a month. PROJECT TEAM FOR PROJECT TEAM FOR

MINI ESTATES GROUP FARMING

Manager/Chairman: ManagertChairman:AFO General Officers from

Manager the relevantagencies

Notes:-

(i) * - DICPLC - District Inter-Agency Coordination, PlanningAnd Liaison Committee.

(ii) ** - AICPLC - Area Inter-Agency Coordination, PlanningAnd Liaison Committee.

PROJECT COMPLETION REPORT APPENDIX V


- 57 -

CHANGES IN CROPPING PATTERN

IN THE PROJECT AREA - 1977 AND 1984

Hectares

1977 1984

(i) Smallholders

Padi 19,641 19,641

Coconut 32,615 32,751(9,260 ha. inter- (14,261 ha. inter-cropped with cocoa) cropped with cocoa)

Rubber 7,594 5,537

Oil-Palm 2,650 4,619

C ffee 2,155 1,641

S Lb-total 64,655 64,189

(ii) E tates

Oil-Palm 19,868 21,269

Rubber 4,582 5,884

Coconut 4,965 3,652(1,729 ha. inter- (3,472 ha. inter-cropped with cocoa) cropped with cocoa)

Cocoa (sole 1,497 1,430crop)

Sub-total 30,912 32,235

Grand Total 95,567 96,424

Notes:

(i) 1977 figures from 1977 Annual Report, Department ofAgriculture Selangor.

(ii) 1984 figures from 1984 lst. Half-Yearly Report,Department of Agriculture Selangor.

AVERAGE COSTS OF PRODUCTION OF PADI FARMERS

___--____ ________ _________________ US$/Hectare/SeasonNo --_______ ear 1977 1980 1981 1982 1983 1984

C .osts/Incomes (Appraisal) 2ndSeason IstSeasor2ndSeason IstSeasor 2ndSeaso lstSeasor ndSeason stSeasor 2ndSeasc

^' 1. COSTS(a) Variable Costs

Input costsFertiliser * n.a. 101.00 102.00 99.00 96.00 102.00 104.00 96.00 100.00 106.00Seed n,a. 8.00 7,00 8.00 8.00 10.00 12.00 13.00 13.00 15.00

Weedicide n.a. 17.00 17.00 18.00 21.00 19.00 13.00 16.00 19.00 25.00

Insecticide n.a. 18.00 12.00 13.00 17.00 25.00 18.00 23.00 20.00 23.00

Total input costs n.a. 144.00 138.00 138.00 142.00 156.00 147.00 148.00 152.00 169.00

Labour coststi) Paid labour costs

Ploughing n a. 56-00 62.00 61.00 64,00 65.00 56.00 60.00 62.00 64.00

PLanting n a. 76.00 75.00 77.00 75.00 78.00 78.00 75.00 73.00 76.00

Harvesting n.a. 135.00 99.00 154 00 129.00 101.00 76.00 102.00 106.00 89.00(ii) Unpaid labour costs

Family labour ** n a. 108.00 121 00 88.00 80.00 78.00 75.00 96.00 96.00 102.00

Total labour costs n,a. 375.00 357.00 380.00 348.00 322.00 285.00 333.00 337.00 331.00

(b) Fixed Costs ILand tax and water charges n.a. 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00

Land rent na. 137.00 175.00 167.00 200.00 238,00 227.00 225.00 227.00 212.00

(c) Total Costs n.a. 659.00 673.00 688.00 693.00 719.00 662.00 709.00 719.00 715.00

(d) Total Paid Costs (Owner-operator) n,a. 320.00 283.00 339.00 319.00 309.00 266.00 294.00 302.00 307.00

(e) Total Paid Costs (Tenant-operator) n.a. 454.00 455.00 503.00 516.00 544.00 490.00 516.00 526.00 516.00

2. INCOMES(a) Yield (Kg. of Padi/Ha.) _ 3,865kg. ,835kg. ,394kg. ,681kg. 3,119kg. ,362kg 2,830kg. ,301kg. 3,200kg.(b) Price + Coupon Per 100 kg. _ 26.67 26.67 26.67 26.67 26.67 26.67 26.67 26.67 26.67Qc) Deduction % n.a. 15% 16% 13% 14% 18s 16% 17% 19 17 S(d) Gross Income n.a. 876.00 635.00 1,020.00 844.00 682.00 529.00 627.00 713.00 708.00

(e) Net Income Excluding Family Labour n.a. 556.00 352.00 681.00 525.00 373.00 263.00 333.00 411.00 401.00

(Owner-operator)(f) Net Income Including Family Labou n.a. 448.00 231.00 593.00 445.00 295.00 188.00 237.00 315.00 299.00

(Owner-operator)(g) Net Income Excluding Family Labour n.a. 422.00 180.00 517.00 328.00 138.00 39.00 111.00 187.00 192.00

8 (Tenant-operator)(h) Net Income Including Family Labour n.a. 314.00 59.00 429.00 248,00 60.00 -36.00 15.00 91.00 90.00

u L (Tenant-operator) _No tes:-Notes(-i) Data from PMU surveys.

(ii) * - Padi fertiliser is subdidised by GOM. Value of subsidy is US$94/hectare/season.

(iii) ** - Family labour for activities such as fertilizer application, spraying, weeding, etc. is imputed at US$4/day.(iv) n.a. = not available.

PROJECT COMPLETION REPORT ANNEX II


- 59 -

AVERAGE COSTS OF PRODUCTION OF COCOA SMALLHOLDERS

US$/Hectare/Annum

No. Costs/ 1977 1982 1983 1984(Appraisal) 18 93 18

1. COSTS7(a) Variable Costs

Input costsFertiliser n.a. 46.00 53.00 57.00Weedicide n.a. 24.00 25.00 36.00

Total input costs n.a. 70.00 78.00 93.00

Labour costs(i) Paid labour

costsWeeding n.a. 23.00 26.00 20.00Application offertiliser n.a. - 10.00 20.00

(ii) Unpaid labourcostsFamily labour* n.a. 174.00 164.00 183.00

Total labour costs n.a. 197.00 200.00 223.00

(b) Fixed CostsLand tax and water

I charges ** _ _ -_

(c) Total Costs n.a. 267.00 278.00 316.00

2. INCOMES(a) Yield (Kg. Dry

Beans/Ha.) _ 313kg. 275kg. 347kg.(b) Price/Kg. n.a. 1.17 1.61 1.92(c) Gross Income n.a. 366.00 443.00 666.00(d) Net Income Excluding

Family Labour n.a. 273.00 329.00 533.00(e) Net Income Including

Family Labour j n.a. 99.00 165.00 350.00

Notes:-(i) Data from PMU surveys.(ii) * - Family labour for activities such as weeding,

fertiliser application, pruning, harvestingis imputed at US$4/day.

(iii) ** - Cocoa is grown under coconut. To avoid double

counting the land tax and water charges willonly be accounted under the coconut costsof production.

(iv) n.a. - not available.

PROJECT COMPLETION REPORT ANNEX III


- 60 -

AVERAGE COSTS OF PRODUCTION OF COCONUT SMALLHOLDERS

l -Year US$ /HecLare/Annum -

(Appraisal) 1982 1983 1984

1. COSTS

(a) Variable Costs

Input costsFertiliser * n.a. _ _ _Weedicide * n.a. _ _ _

Total input costs n.a.

Labour costs

(i) Paid labourcostsHarvesting n.a. 69.00 65.00 46.00Dehusking n.a. 69.00 65.00 46.00

(ii) Unpaid labourcostsFamily labour n.a. _ - -

Total labour costs n.a. 138.00 130.00. 92.00

(b) Fixed CostsLand tax and watercharges n.a. 5.00 5.00 5.00

(c) Total Costs n.a. 143.00 135.00 97.00

2. INCOMES

(a) Yield (Kg. OfCopra/Ha.) _ 1,265kg. 1,331kg. 847kg.

(b) Price Per 100kg. n.a. 33.00 34.00 55.00(c) Gross Income n.a. 417.00 453.00 466.00(d) Net Income n.a. 274.00 318.00 369.00

Notes:-(i) Data from PMU surveys.(ii) * - Coconut is intercropped with cocoa. On such farms,

farmers maintain their cocoa rather than theircoconut. Therefore, in order to avoid doublecounting input and maintenance costs will only beaccounted under the cocoa costs of production.

(iii) n.a. = not available.

PROJECT COMPLETION REPORT ANNEX IV


- 61 -

AVERAGE COSTS OF PRODUCTION OF RUBBER SMALLHOLDERS

US$/Hectare/AnnumYear~~97Nz Costs/Inc oms (Aprais' 1982 1983 1984

1. COSTS

Input costsFertiliser n.a. - - -

Weedicide n.a. 21.00 28.00 43.00Total input costs n.a. 21.00 28.00 43.00

Labour costsl) Paid labour

costsWeeding n.a. _ _ _Application offertiliser n.a. _ _ _Tapping n.a. - - -

(ii) Unpaid labourcostsFamily labour* n.a. 219.00 305.00 255.00


(b) Fixed CostsLand tax and watercharges n.a; 5.00 5.00 5.00

(c) Total Paid Costs n-a, 26.00 33.00 48.00

(d) Total Costs n.a. 245.00 338.00 303.00

INCOMES(a) Yield (Kg. of

latex/Ha.) _ 748kg. 771kg. 676kg.

(b) Price Per 100kg. n.a. 48.00 69.00 64.00(c) Gross Income n.a. 359.00 532.00 432.00(d) 'Net Income excludingD

family labour I n.a. 333.00 499.00 384.00(e) Net Income including

family labour j n.a. 114.00 194.00 129.00

Notes:-

(i) Data from PMU surveys.(ii) * - Family labour for activities such as

weeding, tapping, etc. is imputed atUS$4/day.

(iii) n.a. not available.

PROJECT COMPLETION REPORT ANNEX V


- 62 -

AVERAGE COSTS OF PRODUCTION OF OIL PALM SMALLHOLDERS

NO.~'~- Year US$/Hectare/AnnumCos.s/Income 1977Costs/I n7 (Appraisal) 1982 1983 1984

1. ,COSTS(a) Variable Costs

Input costsFertiliser n.a. 135.00* 67.00 72.00Weedicide n.a. 28.00 19.00 40.00Total input costs n.a. 163,00 86.00 112.00Labour costs(i) Paid labour

costsWeeding n.a. 5.00 28.00 21.00Applicationof fertiliser n.a. 16.00 10.00 20.00Harvesting n.a. .43.00 71.00 129.00

(ii) Unpaidlabour costsFamilylabour ** n.a. 64.00 87.00 108.00


(b) Fixed CostsLand tax andwater charges n.a. 5.00 5.00 '5.00

(c) Total Costs n.a. 296.00 287.00 395.00

2. INCOMES(a) Yield (Kg. of

FFB/Ha.) _ 5,290kg. 8,820kg. 10,657kg.(b) Price Per 100 Kg. n.a. 5.00 7.00 9.00(c) Gross Income n.a. 265.00 617.00 959.00(d) Net Income Excluding

Family Labour I n.a. 33.00 417.00 672.00(e) Net Income Including

Family Labour n.a. -31.00 330.00 564.00

Notes:-(i) Data from PMU surveys.(ii) * - Including Government subsidy.(iii) ** - Family labour for activities such as fertiliser

application, weeding, etc. is imputed at US$4/day.(iv) n.a. = not available.

PROJECT COMPLETION REPORT X VI


- 63 -

AVERAGE COSTS OF PRODUCTION OF COFFEE SMALLHOLDERS

Year US$/Hectare/AnnumNo. Costs/In e 17(Appraisal)7

1. COSTS(a) Variable Costs

Input costsFertiliser n.a. 134.00 65.00 -

Weedicide n.a. 24.00 22.00 27.00

Total input costs n.a. 158.00 87.00 27.00

Labour costs(i) Paid labour

costsWeeding n.a. 27.00 _ _Application offertiliser n.a. 5.00 _ -

(ii) Unpaid labourcostsFamily labour*' n.a. 199.00 177.00 161.00


(b) Fixed CostsLand tax andwater charges n.a. 5.00 5.00 5.00

(c)'Total Costs n.a. 394.00 269.00 193.00

2. INCOMES(a) Yield (Kg. of

Berries/Ha.) 3 ,596kg. ,873kg. 1,859kg.(b) Price Per 100 Kg. n.a. 14.00 13.00 17.00(c) Gross Income n.a. 503.00 373.00 316.00(d) Net Income Excluding

Family Labour n.a. 308.00 281.00 284.00(e) Net Income Including

Family Labour n.a. 109.00 104.00 123.00

Notes:-(i) Data from PMU surveys.(ii) * - Including Government subsidy.(iii) ** - Family labour for activities such as fertiliser

application, weeding, harvesting, etc. isimputed at US$4/day.

(iv) n.a. = not available.

HOUSEHOLD'S INCOME

1977 (Appraisal) 1984

Year Average Average Annual In-No. \ Incremental No. Of Annual Incremental No. Of come Per. Household

Income Per US$usehol Hd - Household Other

Households Persons US$ Households Persons Farm Sources Total

1. Total households 32,000 192,000 n.a. 33,000* 198,000* n.a. n.a. n.a.

N4 |2. Farm households n.a. n.a. 181 19,500 117,000 124 235 359C.'

4J uNotes:-0 W (i) * - During implementation the Project area was extended and hence

$4 sthe additional number of farm households/population in 1984.

o o (ii) n.a. - not availableHz z

0

(| 4JGE

2

PROJECT COMPLETION REPORT ANNEX VIII


- 65 -

AMOUNT OF LOANS DISBURSED BY

AGRICULTURAL BANK OF MALAYSIA

Amount Amount ofLoans Disbursed

Year (US$)

1977 340,908

1978 841,056

1979 825,958

1980 1,168,919

1981 1,180,923

1982 3,167,742

1983 2,544,737

1984 3,251,141

Notes:-

(i) Data from AgriculturalBank of Malaysia, TanjongKarang.

MALAYSIA.~ - Northwest Selangor Integrated Agricultural

Development ProjectMain CanalsRoadsDrains

il ;lo -)'t < Tanjong Korarig Irrigation Areaspe 0 Existing Tidal Control Gate( - -- ,, { f ii &/P N ® Proposed Tidal Control Gate

O . 1 t t ) 4 k S I Replacement Tidal Control Gatefl - 5- < , ,: A i; t4 I A Proposed Pump House

UnJ'~ Existing Bund to be Upgraded

Ay t'-~ -/ '; --- 9 ) 1 ...................... -- Proposed Bund ReconstructionC Proposed FDC's

\,~~~~~~~ --- ~~~~~~~~Distri'ct Boundaries

- - - Stare Boundaries

STATION= ED R DISTRICT

SABAK / I fANVONG /ARANC,

at a/c c c a PEAT SWAMP15~- 5O, 2 5 4 6 e to K~~~~~~~UALU SELANGOR

KILOMETERS I

*4lcaicca c c o PEAT SWAMP

V < T TINGGI HEADWORK-\O 2 4, ^ 8 10 \V<XSPltibY~~~~~~~~~~SILLAY -.- '

2 S 6 8 15 - SPILLWAY 1, KUALA SELANGOREOMErERS S r v

9 V A 19 DISTRICT

KILOMETERS V --- lTor -r o r-To

-?FRA~X " o on!

AREA ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~~~~~IGI EDOt0 2 A 6 8s 10 \.t, ,\

A to KUALA SELANGOR

KILOMETERS SRC

IRONat.s _/ or Tonjn,

tit i;tST%ett bm tIAAN s to 'wt

KEDAM ~ ; -4_ 2 e G A- t EA

tllOYETERS '-,olo - 4 / donrM*tlph.rw7abputf 'DISTRICT

PEM4Nq / KELANTAN \Vr.wsou Selangor r '&+1 itIir

-- EtRAmti Kf I EdonNA4'. ft V '

I~ ~ ~ ~ ~ ~ ~ ~~~~~~~~~~~~v-r SA .

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