Document of

The World Bank FILE UO .

FOR OFFICIAL USE ONLY

Report No. P-3557-EA

REPORT AND RECOMMENDATION

OF THE

PRESIDENT OF THE

INTERNATIONAL DEVELOPMENT ASSOCIATION

TO THE

EXECUTIVE DIRECTORS ON THREE PROPOSED CREDITS

EACH IN AN AMOUNT OF SDR 13.8 MILLION

TO THE

REPUBLIC OF BURUNDI, RWANDESE REPUBLIC, AND-REPUBLIC OF ZAIRE

FOR THE

RUZIZI II REGIONAL HYDROELECTRIC POWER PROJECT

May 5, 1983

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

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Currency Equivalents

Burundi Franc (FBu) Rwanda Franc (FRw) Zaire (Z)FBu 1 - US$0.01 FRw 1 - US$0.01 Z 1 - US$0.17US$1 - FBu 87 US$1 - FRw 87 US$1 - Z 5.9

Measurements

GWh gigawatt hour 1,000,000 kilowatt hourskV kilovolt 1,000 voltskW kilowatt 1,999 wattskWh kilowatt hours 1,000 watt hoursMWh megawatt hour 1,000 kilowatt hoursMW megawatt 1,000 kilowattstoe ton of oil equivalent 10,500,000 kilocalorieston metric ton 1.1 US tons

Abbreviations and Acronyms

BDEGL Banque de developpement des Etats des grands lacsBEI Banque europeenne d'investissementCCCE Caisse centrale de cooperation economiqueCEPGL Communaute gconomique des pays des grands lacsEGL Energie des .pays des grands lacsELECTROGAZ Etablissement public de production, de transport et de

distribution d'eau, d'electricit6 et de gaz (Rwanda)FED Fonds europeen de dEveloppementFAC Fonds d'aide et de cooperationREGIDESO Regie de distribution d'eau et d'electricite (Burundi)SINELAC Societe internationale d'electricite des pays des

grands lacsSNEL Socigtg nationale d'electricite (Zaire)SOFIDE Societe financiare de dgveloppement gconomique (Zaire)

Financial Year = Calendar Year

REGIDESO (Burundi), ELECTROGAZ (Rwanda), and SNEL (Zaire)

SINELAC

FOR OFFICIAL USE ONLYBURUNDI, RWANDA, ZAIRE

RUZIZI II REGIONAL HYDROELECTRIC POWER PROJECT

SUMMARY OF CREDITS AND PROJECT

Borrowers: Republic of Burundi, Rwandese Republic, Republic ofZaire.

Beneficiary: Societe internationale d'electricite des pays desgrands lacs (SINELAC)

Amount: Three credits of SDR 13.8 million each (US$15 millionequivalent each).

Terms: Standard.

Co-lenders: European Development Fund (US$20.5 million equival-ent); Italy (US$8.5 million equivalent), BDEGL(US$1.9 million equivalent).

Relending Terms: The IDA Credits would be on-lent to SINELAC at an in-terest rate of 10.97 percent; the loans would maturein 25 years with an eight year grace period. The FEDloan would be lent at one percent per annum for 40years, with a ten year grace period. The Italianfunds would be passed on to SINELAC as a grant. TheBDEGL loan would be at a rate of 7.5 percent perannum for 13 years, including a three year graceperiod.

Project Description: The proposed project would expand the supply of elec-tricity to the interconnected system serving Burundi,Rwanda and Zaire in order to sustain the economicgrowth of their industrial, commercial and domesticsectors. The project would construct hydroelectricgenerating facilities including a dam, powerhouse,switching station and transmission line. Experts'services would be provided for periodic review of damdesign, to supervise construction, to initiallyoperate and maintain the facility and to providepractical training for managerial and technicalstaff. In addition, a study of training needs willbe undertaken, including the feasibility of aregional training center.

The main risks of the project are institutional andrelate to the ability of the newly created company,

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

- (ii) -

SINELAC to carry out its functions. The first ele-ment of risk concerns the ability of the threeGovernments to cooperate within the framework of aregional project. This problem is relatively limitedgiven the past cooperation in the use of electricityin the region and the recognition of the threeGovernments of their common interest in energydevelopment. The second element of institutionalrisk relates to SINELAC's ability to execute theproject given the relative inexperience of thecompany. These risks have been reduced by provisionof consultants' services to assist SINELAC withconstruction and operation of the facility, and theperiodic review of design and construction proceduresby a panel of experts. An additional risk is thatthe anticipated rate of growth in the demand forelectricity would not be realized, making the projectpremature. This risk is minimal since the loadforecasts for each of the countries are.conservative; moreover, new transmission anddistribution works will be carried out in conjunctionwith the proposed project and should lead to demandincreases well in line with the forecasts.

Estimated Costs: Project costs, net of taxes 1/, are detailed in thetable below:

…-----US$ thousands-------Local Foreign Total

Civil Works 5,000 31,300 36,300Hydraulic Equipment 200 2,800 3,000Turbines 200 4,700 4,900Generators 200 4,200 4,400Powerhouse 200 2,000 2,200Switching Station & Transmission Line 700 2,900 3,600Roads & Housing 500 900 1,400Final Design & Construction Supervision 500 3,500 4,000Technical Assistance 2,100 3,000 5,100

Base Cost 9,600 55,300 64,900

Contingencies: - Physical 1,000 6,800 7,800- Price 1,600 10,600 12,200

Total Project Cost 12,200 72,700 84,900

Interest During Construction 46,000 - 46,000

Total Financing Required 58,200 72,700 130,900

/ Duties and taxes would not be levied on the Project.

- (iii) -

Financing Plan:…-------- US$ millions------Local Foreign Total %

IDA - 45.0 45.0 53BDEGL 0.7 1.2 1.9 2FED 2.1 18.4 20.5 24Italy 0.4 8.1 8.5 9Burundi 3.0 - 3.0 4Rwanda 3.0 - 3.0 4Zaire 3.0 - 3.0 4

Project Construction Finan-cing Requirements 12.2 72.7 84.9 100

Capitalized Interest DuringConstruction (SINELAC) 46.0 - 46.0

Total Financing Requirements 58.2 72.7 130.9

Estimated Disbursements:

--------------------US$ millions-------------------IDA FY FY1984 FY1985 FY1986 FY1987 FY1988 FY1989

Annual 11.0 19.0 11.0 3.2 0.4 0.4Cumulative 11.0 30.0 41.0 44.2 44.6 45.0

Rate of Return:' 9 percent. The economic rate of return was computedat the distribution level, taking into account thecost of necessary complementary works fortransmission and distribution. (The rate of returnwould be 10 percent if based on average bulk tariffsand on the cost of hydro facilities). This economicrate of return does not take into account theeconomic benefits deriving from the availability ofhydropower rather than higher cost diesel-generatedpower that some consumers would be ready to buy.

Appraisal Report: Report No. 4303-EAF, dated May 3, 1983

Map: IBRD 15919

INTERNATIONAL DEVELOPMENT ASSOCIATION

REPORT AND RECOMMENDATION OF THE PRESIDENTTO THE EXECUTIVE DIRECTORS

ON THREE PROPOSED CREDITS TOTHE REPUBLIC OF BURUNDI,

THE RWANDESE REPUBLIC ANDTHE REPUBLIC OF ZAIRE

FOR THE RUZIZI II REGIONAL HYDROELECTRIC POWER PROJECT

1. I submit the following report and recommendation on three proposeddevelopment credits to the Republic of Burundi, the Rwandese Republic and theRepublic of Zaire, each in the amount of SDR 13.8 million equivalent (US$15.0million each) on standard IDA terms to finance the Ruzizi II Regional Hydro-electric Power Project. For purposes of the project, the European Develop-ment Fund has agreed to provide US$20.5 million equivalent; the Government ofItaly has agreed to provide US$8.5 million equivalent and the DevelopmentBank of the Great Lakes Region (BDEGL) has agreed to provide US$1.9 millionequivalent. The IDA Credits would be on-lent to the international companycreated to execute the project, SINELAC, for 25 years with 8 years grace atan interest rate of 10.97 per cent. The terms of cofinanciers' loans andtheir on-lending rates are given in paragraph 67.

PART I - THE ECONOMY

The Countries and the Region

2. Burundi, Rwanda and Zaire sometimes refer to themselves as the"countries of the Great Lakes" and on that basis have created the Great LakesEconomic Community (Communautg economique des pays des Grands Lacs - CEPGL).Prima facie, there are striking disparities between Zaire and its two easternneighbors in terms of size, recent economic developments and economic poli-cies, as well as geographical features. However, the countries of the GreatLakes also have a lot in common. They suffer from serious poverty as indi-cated by the low level of per capita income: $239 for Rwanda, 235 forBurundi and $220 for Zaire in 1980; they share physical, demographic andstructural features, and face similar economic and financial difficulties.All three countries are also heavily dependent on concessional aid flows tofinance foreign capital requirements. Similarities are even stronger whenone considers the Great Lakes Region, defined as comprising Burundi, Rwandaand the eastern part of the Kivu province of Zaire. The following sections:(i) discuss the characteristics, issues and constraints of the Great LakesRegion, as defined above, and the community institutions; and (ii) outlinethe major economic developments and issues faced by the three countries andthe actions undertaken or planned by the respective Governments (with data oneach country appearing in Annexes IA, IB and IC).

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Regional Characteristics and Institutions

3. The Great Lakes Region is a landlocked, densely populated area, co-vering nearly 90,000 km2, whose essentially rural population has one of thelowest per capita incomes in the world. In spite of local variations anddifferent national policies, the Region is rather homogeneous in geographi-cal, demographic and economic terms. It is mountainous, with altitude miti-gating the tropical climate, and benefits from abundant rainfall. The landis naturally fertile, that is when soil has not been eroded or depleted. Thepopulation of about 12.5 million in 1982 s>are common dialects and tribalorigin owing to historical movements across common boundaries of the area.Population grows at 2.5 to 3.5 percent per year and density averages 140persons/km2, but reaches 300 persons/km3 on arable land. This very highdensity has caused soil depletion and declining agricultural yields resultingin migrations, principally to primary urban centers.

4. The Region is predominantly rural. Individual farms are usuallyless than one hectare in size and support subsistence farming of foodcrops,mainly pulses, bananas (principally used for beer production), tubers andcereals. Declining soil fertility in the densely-populated areas and varyingsoil conditions in the newly-settled areas, (often marginal lands because ofpopulation pressure in Rwanda and Burundi) have led to declining yields insome of the main crops. Cattle raising, traditionally a source of wealth andprestige in the social structure, is also being gradually replaced by smallfarm animals (pigs and chickens) because of declining pasture and grazingland and the shortage of animal feed. With regard to cash crop production,the Region is heavily dependent on coffee for foreign exchange earnings andtax revenue. Although Rwanda has attempted to diversify its export mix withtea, pyrethrum and cinchona, coffee still constitutes more than 60 percent ofmerchandise exports and provides around 20 percent of total governmentrevenue. The Kivu province, which contributes about 15 percent ofagriculture value-added and produces on average 50 percent of Zaire's coffee,is an area with high agricultural potential, but its cash crop mix is similarto that of Rwanda. Burundi is even more dependent n coffee than Rwanda orKivu, with coffee representing about 90 percent of its average exportearnings during 1979-81. The overwhelming dependence on one crop has madeincome in the Region very vulnerable to fluctuations in world coffee prices,which directly affects the external trade balance of their respectiveeconomies, tax revenues and coffee farmers' real income and incentives.Moreover, domestic constraints such as transport bottlenecks, shortage ofessential agricultural inputs, and lack of agricultural credit aggravateagricultural and marketing problems.

5. The landlocked position of the Region (about 1500 km from the near-est port) and a poor transport system have contributed to the scarcity andhigh cost of inputs and complicated the marketing of both food and cashcrops. Internal transport is handled almost entirely by an inadequate roadnetwork (2300 km paved and gravel roads in Rwanda, a total of 5500 km inBurundi and 7500 km in the Kivu province) which crosses rugged terrain, is ofvery low quality and features frequent and narrow curves, steep gradients and

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uneven surfaces. Road construction and maintenance are consequently a costlyundertaking. Moreover, external links for the shipments of imports and ex-ports are limited (mainly via Mombasa or Dar-es-Salaam) and frequently sub-ject to political and economic risks, leading to delays, losses and burden-some administrative and customs procedures. Lake transport is available on asmall scale but requires maintenance and repair of barges and berthingfacilities, which are in short supply. An expensive but increasingly usedalternative is air transport which, in Rwanda, now handles 20 percent ofexternal trade; in Kivu, vegetables and meat are the principal productsshipped by air from Goma.

6. Commercial energy consumption, in the form of petroleum productsand electricity, represents less than 10 percent of total energy consumptionof the Region and is concentrated in the major urban areas or independententities, such as missions. (Per capita consumption of commercial energy isabout one-third of the average of developing countries of similar size andincome level.) Traditional energy sources, which account for the remainingenergy consumed, are non-commercial fuels - agricultural residues, fuelwoodand charcoal, used mainly for cooking. The dependence of rural households onfuelwood as a main source of energy has led to serious problems ofdeforestation and scarcity of fuelwood, particularly in densely-populatedareas. A major problem, notably in Kivu, has been the shortage of petroleumproducts, often paralyzing the industrial and transport sectors; Kivutraders and businessmen occasionally have to purchase petroleum productsacross the border from Rwanda and Burundi.

7. In September 1976, Burundi, Rwanda and Zaire established the GreatLakes Community (CEPGL) in order to: (i) ensure security among the membercountries; (ii) promote free movement of persons and goods within the area;and (iii) assure political and economic cooperation. The CEPGL is headed bythe Conference of Heads of State, complemented by the Council of Ministers,composed of the Ministers of Foreign Affairs of the member states. The admi-nistrative and operational staff represent the member countries and areseconded from their respective government service_1, In addition to the bud-getary support of the three member countries, the Community receives supportfrom external sources, principally Belgium and the United States. The Commu-nity's most important organization is the Development Bank of the Great LakesCommunity (BDEGL) which was established in September 1977 to finance regionaldevelopment projects. The Bank's paid-in capital, of which Zaire provides 50percent and Burundi and Rwanda 25 percent each, represents 51 percent ofauthorized capital. The remaining 49 percent is to be subscribed by nationalinstitutions in the member countries and international institutions. In1978, the Community absorbed Energie des pays des grands lacs (EGL) which hadbeen formed by the three countries in 1974 primarily to investigate and pro-mote means of expanding electrification of the Great Lakes Region. In recog-nition of the variety of energy issues common to the Region, EGL's area ofresponsibility was subsequently expanded to include all energy matters. Thenewest regional institution is the Institut de recherche agronomique et zoo-technique des pays des grands lacs (IRAZ), formed in July 1980, to carry outagricultural research in areas of common interest to the member countries.The institutions of the Community represent the first endeavor to achieve

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regional integration and cooperation; however, they are still in theirinfancy and, therefore, require financial and technical assistance fromexternal sources to carry out their activities and operations.

National Economic Developments and Issues

8. An economic report on Rwanda was discussed with the Government inDecember 1982 and February 1983, and will be issued shortly. The lasteconomic report on Burundi (Report No. 3071-BU) was distributed to theExecutive Directors in March 1981. A Country Economic Memorandum on Zaire(Report No. 4077-ZR) was distributed to the Executive Directors in January1983. This section summarizes the essential points of each report to whichreference can be made for further details.

Burundi

9. Of Burundi's population of about four million, only 100,000 arewage earners with the remainder primarily dependent on subsistence agricul-ture. The Government is facing several critical problems in its efforts todevelop the economy: the capability to prepare and manage programs and pro-jects is weak; the agricultural labor force is largely untrained; and popula-tion growth keeps straining Burundi's productive resources, particularly inagriculture. Despite a stated policy of "spaced births", the problems ofpopulation pressure cannot be solved in the immediate future. A major effortmust therefore be made to increase agricultural productivity. During thepast decade, per capita agricultural production has stagnated. The searchfor mDre arable land has caused large-scale deforestation and severe shortageof firewood in the rural areas, which makes the development of alternativeenergy sources urgent.

10. From the middle of the 1970's through 1981, the economy of Burundihas experienced erratic growth resulting from fluctuations in the world mar-ket price of coffee and the effects of weather on crop production; GDPaveraged a record 4.4 percent during the latter half of the 1970's, fell to1.8 percent in 1980 and recovered, owing to a large increase in the volume ofexports, to grow at about 5 percent in real terms in 1981. In spite of theimproved export situation, the balance of payments registered an overalldeficit in 1981 of about US$30 million owing mainly to increased imports, adecline in net capital inflows, and a depreciation of the banking system'sforeign exchange holdings in terms of the US dollar. By the end of 1981,Burundi's gross reserves had fallen to about US$60 million, equivalent to 3months of imports of goods and non-factors services, and in 1982 theydeclined further.

11. Burundi recently completed a third Five-Year Economic and SocialDevelopment Plan for the period 1978-82, aimed at increasing agriculturalproduction, accelerating economic growth and investments, and decentralizingdevelopment activities. (A new five-year Plan for 1983-87 has been preparedbut has not yet been reviewed by the Bank.) Scarcity of land due topopulation pressure is a very real problem in a number of provinces, wherefarmers may be forced to shift from coffee cultivation to foodcrop

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production. In order to promote integrated rural development, the Governmenthas established regional development companies to ensure appropriatetechnology, village-level organizations, and decentralization of governmentservices. To this end, the Government has also launched a number ofintegrated rural development projects, which are expected to benefit anincreasing number of small farmers. However, the implementation of theseprojects has been hindered by limited knowledge of intensified cultural prac-tices and of the willingness of small farmers to adopt them.

12. Increasing the efficiency of the parastatal sector now constitutesa major policy issue and is a top Government priority. Despite certain suc-cesses, a number of parastatals have been affected by inadequate coordinationwith the central Government, management problems, financial weaknesses and,in the case of agricultural parastatals, lack of small farmer participationdue to insufficient incentives. With assistance from the Association, theGovernment is assessing the situation of the parastatal sector with theintention of trimming inefficient activities and providing strengthenedenterprises with the resources, autonomy and flexibility it requires toachieve satisfactory economic and financial performance.

13. Because of the unfavorable outlook for world coffee prices, themedium-term prospects of the economy are not promising. The impact of anydecline in coffee prices would have to be absorbed by the small farmers(through lower producer prices) and by the Government (through lower coffeetax receipts). Even with a policy of demand restraint, it will be difficultfor Burundi to reduce its current account deficit to below 10 percent ofGDP. In light of this, Burundi's future external capital requirements arelikely to be much higher than in the recent past. Notwithstanding itsrelatively low debt service ratio (5.6%), Burundi, because of its poverty andinstability of its export earnings, cannot afford to borrow on commercialterms. External aid should therefore be on grant or any concessional termsand should continue to include a substantial share of local cost financing.More direct balance of payments support and/or assistance for essentialimports may also be needed in the medium term to assist the country throughthis difficult period of adjustment.

Rwanda

14. During the second half of the 1970s, Rwanda witnessed a period offairly rapid economic growth, which averaged 5 percent per annum. Theprincipal catalysts to growth were essentially external: favorable weather,terms of trade and capital inflows. Combined, these factors also hadpositive effects on the budget, balance of payments and investment rates.Good weather conditions resulted in rapid agricultural growth of both foodand export crops, thereby alleviating the demand for food imports, whileincreasing government revenues from export duties and foreign exchangeearnings. Favorable terms of trade (mainly due to a rise in coffee prices inthe late 70s) allowed exports to finance a larger volume of imports.Increased capital inflows also facilitated the rapid growth of imports andthe consequent increase in tax revenues.

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15. Aside from favorable external factors, the Government's overalleconomic management, and especially its strong commitment to economic deve-lopment, deserves credit for the accelerated growth of the recent past.Among the recent development-oriented actions taken by the Government are:(i) an emphasis on developing physical infrastructure, especially transporta-tion; (ii) a focus on the identification and implementation of agriculturalprojects and programs oriented toward raising small-holder productivity;(iii) raising coffee producer prices to the highest level in Africa; (iv)the adoption of a comprehensive education reform, with the objective ofadapting the education and training system to the country's economic andsocial development needs; (v) encouragement of communes as multi-purposeinstruments of rural development; and (vi) taking first steps towardaddressing the problems of high population growth.

16. Rwanda has recently prepared a Third Development Plan for theperiod 1982-86, whose priorities are an extension of the objectives of theprevious Plan, mainly: (i) self-sufficiency in food; (ii) productiveemployment and practical education/training; (iii) improvement of livingstandards through better health care and basic social services; and (iv)improvement of external transportation links and commercial relations.Although the Government had made serious efforts to pursue these objectivesin the past, structural, financial and institutional constraints have limitedthe effects.

17. Efforts to increase agricultural production have had modestresults, mainly because of the rapidly increasing population. The 1979education reform has been hampered by financial and administrativeconstraints and by the limited number of teachers. Employment has increasedsignificantly only in the public administration and construction sectors.Despite a gradual increase in the number of health/nutrition centers andhospital beds, health services in rural areas are still sparse and watersupply has tended to deteriorate in some rural areas. A rudimentary roadnetwork continues to hamper agricultural specialization and monetization,while reliance on transportation through neighboring countries leaves themovement of trade in a precarious situation. Although, as noted earlier,Rwanda has had some success in diversifying its exports, its vulnerability toworld market conditions still remains. Moreover, implementation ofdevelopment programs and projects has suffered from institutional weaknessesstemming from lack of skilled personnel, fragmentation of institutionalresponsibilities and poor coordination among agencies concerned with projectpreparation and implementation.

18. Economic management in recent years has been prudent as evidencedby relative success in controlling inflation, maintaining a low debt serviceratio and avoiding projects of dubious economic justification. This patternhas been facilitated by favorable terms of trade and substantial aid flows.However, Rwanda's need for external assistance is likely to increase in thenext few years, as its fiscal and balance of payments prospects are lessfavorable than in the past, principally as a result of depressed world pricesfor its major exports (coffee, tea, cassiterite and wolfram). Agricultural

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production, particularly of foodcrops, is not expected to increasesignificantly in the short run, as it will take time to raise yields. Largeincreases in mining production will only be possible if the financing forcurrently planned investments materializes. Given the poverty of the country,its overwhelming constraints and vulnerability, and its uncertain medium-termprospects, external funds should continue to be provided in the form of grantsor loans at highly concessionary terms, and include a high proportion of localcost financing and non-project assistance.

Zaire

19. Since 1975, Zaire has been experiencing serious economic diffi-culties which have brought about a continuous decline in per capita income.In many respects these difficulties are the result of developments which tookplace in earlier years, principally: the progressive accentuation of thecountry's dependence on the mining sector, accompanied by the relativeneglect of agricultural production; heavy external borrowing during 1973-74;and the attempts to change drastically the ownership structure of the economythrough the zairianization and nationalization measures of 1973-74, whichhave since been rescinded. Until 1979, notwithstanding three IMF-supportedstabilization programs and three debt rescheduling agreements under the ParisClub, the budgetary deficit, inflation and external debt service remainedmajor problems. While the economic decline was arrested in the followingthree years, many of the difficulties have continued.

20. In 1980, GDP expanded by 2.4 percent, the current account balanceshowed a small surplus, the inflation rate was halved to about 44 percent andexternal public debt service payments nearly doubled. Moreover, theGovernment was able to implement an IMF-supported stabilization program andreach a debt rescheduling agreement under the Paris Club and another withsyndicated banks. The progress achieved in 1980 led to the formulation andadoption in mid-1981 of a three-year program of economic and financialadjustment supported by an Extended Facility from the IMF. However, economicperformance during the year deteriorated because of internal and externalfactors. Exports fell due to the weakening of the copper and cobalt markets;imports decreased to thin lowest level since the beginning of the crisis; thebudgetary deficit expanded substantially leading to heavy governmentborrowings. As a result, Zaire could not comply with the criteria under theEFF and the program was cancelled in June 1982. During that year, thebudgetary deficit doubled from the 1981 level, the inflation rate stayedaround 40 percent and external public debt arrears reached a level of US$800million at the end of the year.

21. Since 1979 the Government has taken various steps to improve eco-nomic management, development planning and institutional performance, in par-ticular: (i) the preparation of a medium-term Public Investment Program (PIP)1981-83, emphasizing rehabilitation in priority sectors; (ii) the installationof high-level technical assistance teams at the Central Bank and the Ministryof Finance; (iii) the creation of a Central Pay Directorate to streamline andcurtail the growth of the government payroll and a semi-autonomous customsoffice (OFIDA); (iv) the adoption of an Agricultural Action Plan, focusing onthe strengthening of institutions, new policies for pricing, credit, marketing

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and foreign exchange allocation, and improved processes for monitoringproject implementation and sectoral investment programming; (v) cooperationin the preparation of a fiscal study with the IMF/Bank, emphasizingexpenditure control, tax reform and a new regime for Gecamines; (vi)appointment of broadly-based Executive Boards for Gecamines and Sozacom andapproval of a new marketing arrangement between the two firms; (vii) theannouncement of "privatization" for 37 public enterprises; and (viii) theimplementation of a "decentralization policy" to attain more regionalautonomy. Despite these attempts to define the actions necessary forrecovery, the Governmentts implementation of policies and overall managementhas been weak.

22. Although Zaire's exports are expected to improve in the next threeyears (largely because of the anticipated recovery of copper prices), theresource constraints will remain severe. This is partly due to the externalpublic debt burden: the contractual debt service due in the next three yearsis equivalent to about 45 percent of projected exports of goods and nonfactorservices. Moreover, as a result of the sharp drop in commitments over thelast few years, the undisbursed project pipeline--the source of future dis-bursement--has been reduced to US$670 million, compared to US$1.2 billion in1975,

23. The Zairian authorities are awvare that in these circumstances theywill need to take stronger action to: (i) bring the foreign exchange rate toa more appropriate level; (ii) generalize the appi'cation of the price libe-ralization measures; (iii) reduce the budgetary deficit by implementing therecommendations of the recently completed IMF/Bank fiscal study; (iv) createthe conditions for improving the prospects of financing Gecamines' rehabili-tation program; (v) implement the Agricultural Action Plan, bearing in mindthat a number of policies remain to be formulated; and (vi) revitalize thepublic investment programming and monitoring process. The most urgent prior-ity is to reach a new agreement with the IMfF, as this will help to relievethe resource pressure and hopefully encourage a new external debt reschedul-ing agreement.

Regional Constraints and Prospects

24. Each of the three economies has identified sectoral priorities foreconomic development but is constrained by a number of domestic and externalfactors--rapid population growth rate, fluctuating terms of trade, inadequatetransport links, weak institutional management and uncertain external assist-ance. At the level of the Region, the scarcity of arable land, resultingfrom intense population pressure, aggravates not only the tenuous level ofsubsistence but also the fragile balance between food crop cultivation andcash crop production, in addition, the Region is basically a monocultureeconomy with coffee as the major cash crop. This dependence subjects theeconomy to uncontrollable forces, such as weather and world coffee prices.Finally, the inadequate internal road network, external transportationbottlenecks and high transport costs seriously affect the external andinternal trade. Institutional weaknesses, mainly due to the shortage ofskilled managerial and technical staff and the lack of coordinating among

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ministries and related agencies, hinder investment planning and thepreparation and implementation of projects. Reliance on scarce external aidfor most capital investments has not only made the economy of the Regionhighly vulnerable to external factors, but has also tended to diminish theimpact of the policies and action of the three Governments. Through regionalcooperation, the three Governments can do much to study and initiate actionsto further their shared interests and resolve common problems. Bycoordinating resources the transportation difficulties of a landlocked regioncan be alleviated, thereby allowing expansion of isolated individual marketsto a regional basis, and pressing issues, such as population planning, or thedevelopment of energy resources, can be approached in a concerted fashion.

PART II - BANK GROUP OPERATIONS

Burundi

25. Bank Group assistance to Burundi was initiated in 1966; sincethen, Burundi has received twenty credits totalling US$157 million. Ofthese, six credits were granted for agriculture (two for coffee production,two for integrated agricultural development, one for fisheries and one forforestry); four for highway maintenance and improvement; two to improveprimary education and vocational and technical training; two technicalassistance credits for planning and public enterprise management and onecredit each for water supply, assistance to the Economic Development Bank,urban development, telecommunications, mining and assistance to the localconstruction industry. In addition, IFC approved a glass container projectin June 1981. Annex IIA contains a summary statement of IDA credits, noteson projects in execution and the status of disbursements as of March 31,1983.

26. After experiencing difficulties in the early years of Bank lending,general project implementation performance has improved in most sectors. Oneindication of this is the recent upward trend in disbursementsl/. Projectshave suffered from start-up delays, and some were not completed as initiallyforeseen because of cost overruns. Disruptions of Burundi's external suppplyroutes were on several occasions the cause of these delays. Externaldifficulties were often compounded by poor project management due to lack ofappropriately trained personnel at all levels and high management turnover.Given existing constraints, however, project performance is, on the whole,satisfactory.

27. Future operations in Burundi will aim primarily at reversing thedecline in agricultural productivity, improving the transport and

1/ In fiscal years 1979-81, disbursements for Burundi totalled US$30.5million compared to new commitments of US$44.5 million. In the sameperiod, the average disbursement rate (ratio of annual disbursementsto undisbursed balance) was 27 percent, which is above the averageof 20 percent for countries of the Eastern Africa Region.

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communication network, developing energy resources and strengthening absorp-tive capacity through training and technical assistance. Projects underpreparation include a third technical assistance credit for improvement ofthe planning process, and management and control of the public enterprisesector; a rural water supply project and an agriculture project. To

strengthen the analytical basis for future lending and assist the governmentin the definition of appropriate sectoral policies, sector studies on energy,agriculture, industry, health and population, and the financial sector havebeen recently completed or are underway.

Rwanda

28. Since Bank Group assistance to Rwanda began in 1970, eighteen IDAcredits have been granted for a total of US$186 million. Seven credits werefor agriculture projects (including livestock, forestry, foodcrops, cinchonaand coffee), five credits were for highway maintenance and construction; twocredits were for education projects to improve the primary and secondarysystems and vocational/technical training; two credits were to assist theDevelopment Bank, and one credit each for a telecommunication and a technicalassistance project mainly for the preparation of development projects. AnIFC loan of US$535,000 for a tea factory was signed in 1976; a second IFCloan of US$226,000 and contingent equity commitment of up to US$60,000 toexpand the tea factory were signed in September 1980. Annex IIB contains asummary statement of IDA credits, IFC investments and notes on the executionof ongoing projects as of March 31, 1983.

29. Execution of IDA financed projects has, on the whole, been satis-factory. Common start-up problems, such as delays in recruiting suitableexperts, have occurred, 'Dut the effects on overall project implementationhave been negligible. The only major problem to date has been misprocurementof education materials and supplies which led to cancellation of about US$1.5million under the first Education Project (Cr. 567-RW); the remaining pro-ject components have been implemented as planned. On the whole, Rwanda'sdisbursement performance has been satisfactory 2 /.

30. For the future, the primary emphasis of Bank operations will remainon rural development, the main objective being to increase food production,as well as export crops, while maintaining soil fertility. A major emphasis

2/ For fiscal years 1979-81, disbursements for Rwanda totalled US$28.9million compared with new commitments of US$42.4 million. In thissame period, the average annual disbursement rate (ratio of annualdisbursements to undisbursed balance) was 20 percent which is aboutaverage for countries of the East Africa Region.

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will also be placed on the development of human resources, focusing on pop-ulation control and support to basic education and skills training to improveagricultural productivity, provide skilled manpower, and influence attitudeson the population issue. Further investment is also justified for infra-structure and, in particular, transportation to reduce the country'sisolation and provide incentives to further intensification of agriculture aswell as increased specialization and diversification through bettermarketing. Another area requiring our special attention is energy to lessenthe demand for fuel imports and mitigate their impact on the balance ofpayments. Future operations to be considered by the Association includeprojects for health/population, rural development and communications.

Zaire

31. From 1969 to date, IDA has approved 32 credits totalling US$483million for agriculture, transport, development finance company operations,water supply, power and education projects. The Bank has also extendedgrants totalling US$400,000 as contributions towards the cost of two planningassistance projects in Zaire. In 1975, the Bank made a loan of US$100 mil-lion for the Gecamines Mining Expansion Project, which was cofinanced by theEuropean Investment Bank and by the Libyan Arab Foreign Bank, and which pro-vided for special repayment arrangements linked to the project's export earn-ings. The IFC, which has a US$760,000 equity participation in the SocietgFinanciere de Dgveloppement Economique, (SOFIDE), approved a US$4.1 millionloan in 1978 for an offshore oil production project and US$230,000 loan in1982 for studies related to the development of an aluminium complex. AnnexIIC contains a summary statement of Bank loans, IDA credits and IFC invest-ments as of March 31, 1983 and notes on the status of ongoing projects.

32. In general, project implementation has been difficult due to thecountry's inadequate manpower and management capability and, in recent years,because of the economic crisis. In the last three or four years, release ofthe required budgetary funds has been difficult periodically because of budg-etary constraints. Lack of foreign exchange to finance spare parts and fuel,and the deterioration of the transport network and marketing system, haveresulted in severe supply problems for most projects. Recruiting and retain-ing adequate staff has also been difficult. The rate of disbursement of IDAcredits has, however, been satisfactory3!. In January 1980, the Bank

3/ For fiscal years 1979-81, disbursements totalled US$101 millioncompared with new commitments of US$105 million. In this sameperiod, the average annual disbursement rate (ratio of annualdisbursements to undisbursed balance) was 24 percent; this comparesfavorably with an average rate of about 20 percent for othercountries of the Region.

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undertook with Zairian officials an overall review of Bank Group projectswhich, for the first time, provided an integrated view of implementation pro-blems. This has resulted in an acceleration and improvement in the utiliza-tion of Bank Group assistance, particularly in the agriculture sector. Asecond review of Zaire's experience with project implementation and policyexecution is planned for May 1983.

33. In the past three years, the Bank Group's main efforts have beendirected towards assisting in the rehabilitation and development of the agri-culture and transport sectors in part through the design and implementationof appropriate new policies. Investments in industry were also emphasizedthrough assistance to SOFIDE. Our lending will contiue to support the trans-port sector (in particular the Voie Nationale); to assist the development ofthe agriculture sector within the framework of the new Agricultural ActionPlan and to promote the development of the industrial and mining sectors. Inaddition, further support will be considered for the energy sector.

PART III - THE ENERGY SECTOR

34. In general, energy consumption in the Great Lakes Region is verylow. Household consumption is based on traditional, non-commercial sources;industrial and commercial activities rely on petroleum products and hydrogenerated electricity. Firewood, charcoal and agricultural waste, remain themajor sources of energy in the Region. However, because of populationpressure and deforestation from encroaching agricultural expansion, woodresources are rapidly being depleted in Burundi and Rwanda, as well as incertain areas of Kivu. There is potential for hydro-electricity, in par-ticular along the rivers forming Rwanda's borders with Zaire and Tanzania,but development would be costly because most sites have low capacity and arewidely scattered, often far from consumption centers. It is known that LakeKivu contains considerable amounts of methane and the possibility of oilresources exists but has not yet been explored; the Association is currentlyfinancing aero magnetic surveys of the region between Zaire and LakeVictoria. Large deposits of peat have been found in Burundi and Rwanda whichare only beginning to be developed. There may also be some potential fordevelopment of geothermal energy. In June 1982, the Bank published twoReports on issues and options in the energy sector in Burundi and Rwanda,respectively (reports No. 3778 and 3779). In addition, in December 1981, theBank prepared an Introductory Energy Sector Review of Zaire. The followingprovides a summary of the findings of these reports, and of the limitedinformation available on Kivu.

Burundi

35. During the last decade, consumption of commercial energy variedsubstantially from year to year, reflecting instability in the supply of

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petroleum products. A steady pattern of growth can be seen after 1978, as aresult of the Government's efforts to develop the country's industrial andcommercial sectors. Growth in energy demand, although temporarily slowed byeffects of hostilities between Uganda and Tanzania on supply, has been atabout 16 percent per annum on average in 1978-81.

36. Firewood, agricultural waste and charcoal are the principal sourcesof energy for the majority of Burundi's population. Dependency of the ruralpopulation on fuelwood and the urban population on inefficiently producedcharcoal, has resulted in severe deforestation which have created both afuelwood shortage and soil erosion. Peat resources, which are considerable,could be developed as a medium-term solution to the fuelwood crisis until thereforested areas mature for harvest; consumption has been growing, but isstill low and will require time and exposure to accustom the population toits use.

37. In 1981, about 75 percent of commercial energy used was in the formof petroleum products, while electricity provided 22 percent and peat wasabout three percent. Burundi is dependent on foreign sources for itspetroleum and is particularly disadvantaged by its landlocked position whichraises the cost of a barrel of petroleum to US$100. There is littleopportunity to develop indigenous resources to substitute for petroleumproducts since their main use is for transportation. Mini-hydro schemes arebeing looked at as a replacement source for industry, commercial andadministrative centers.

Rwanda

38. Rwanda's energy profile is similar to that of its neighbor, Burundiand the problems associated with petroleum supply and deforestation areidentical. As in Burundi, per capita consumption of petroleum products islow (13 liters per year per capita) with little use other than motorvehicles. Mini-hydro plants and peat are also being looked at as replacementsources of energy and numerous reforestation activities are underway. Thepossibility of exploiting methane gas from Lake Kivu is being activelyconsidered.

39. As in the case of Burundi, the demand for commercial energy inRwanda in 1979 was influenced by the events in Tanzania and Uganda. Therewas zero growth in the demand for commercial energy in 1977 with respect to1976, while the growth rates were 13 percent in 1978, 5 percent in 1979, and13 percent in 1980. During the period 1976 to 1980 the increase incommercial energy demand rose at an average annual rate of about 7 percentwhile electricity alone rose at an average annual rate of about 10 percent.

Zaire

40. The data from which a commercial energy balance could be compiledfor Kivu are very sparse. Demand for energy sources is likely to havefollowed the same trend as in the rest of the country, reflecting the general

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climate of economic crisis which has affected Zaire for the past eight yearsand the pervasive scarcities it has generated. As for Rwanda and Burundi,the remoteness from seaports and the lack of transport means have severelyconstrained the use of oil based energy.

41. Non commercial energy is more easily available in Kivu than in theneighboring countries because of its lower population density. Supply isproblematic in some localities, and growing requirements for wood and char-coal will necessitate a better management of forestry resources. This isnevertheless a less urgent issue than that of commercial energy whose supplywill soon constitute a bottleneck to the development of economic activitiesif remedial measures are not taken. The proposed project will improve thesituation for the next decade; beyond that, further development of theprovince's abundant hydro potential will have to be envisaged.

The Power Sub-Sector

42. The availability of electric power to consumers in the region is ingeneral limited to the major cities and towns, and it is estimated that lessthan 2 percent of the total population in the region has access to electri-city. Until recently, the main sources of electricity for the region havebeen two hydroelectric generating stations constructed prior to theindependence of the three countries: Ruzizi, at the outlet of Lake Kivu onthe border between Rwanda and Zaire, and Ntaruka, in northern Rwanda. TheRuzizi generating station (28 MW) is owned and operated by Zaire's electrici-ty utility, SNEL, and exports about 60 GWh annually to Burundi and Rwanda.The Ntaruka generating station, 10.5 MW, is now owned and operated by ELEC-TROGAZ and serves only Rwanda. Since then, the Mukungwa hydroelectric gener-ating station (12 MW) was completed in February 1982 and supplies Rwanda. Atabout the same time, REGIDESO in Burundi commissioned the Mugere hydroelec-tric generating station (8 MW) to meet its needs. The overall generatingcapability in the region is as follows: Burundi, 13.4 MW; Rwanda, 30 MW;and Zaire, 50 MW. All of the foregoing plants are interconnected by 110 kV,70 kV, and 30 kV transmission lines. REGIDESO, ELECTROGAZ and SNEL alsooperate several diesel-driven electric generating units in scattered loca-tions throughout the country; although their capacity is low, it often cons-titutes the only source of power for isolated localities or industries.

43. The annual growth rate of demand on the regional interconnectedsystem averaged approximately 10 percent over the past few years. However,this figure covers somewhat different demand patterns and consumption levelsaccording to the countries. Because of a less extensive distribution net-work, total consumption in Burundi remains low. Expansion of the industrialsector has increased demand for commercial energy sources and produced fairlyhigh growth rates from a low base (15 percent and 12 percent for industry andhouseholds respectively since 1978). In Rwanda, a more developed distribu-tion network has allowed demand to grow more evenly and with higher consump-tion levels; industrial consumption has increased at about 8 percent since1978 and domestic demand has grown at about the same pace as in Burundi.Virtually no data are available for Kivu prior to 1980; since then, growth

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was linked to conversion to electricity of industrial facilities or to exten-sion of the distribution network.

44. Works in Progress. Burundi imports almost all its electric powerfrom Zaire; to lessen this dependence, Burundi has decided to develop anational power source and has chosen to construct the Rwegura hydroelectricpower generating station (18 MW) which will be financed by KfW, CCCE, FED,and the Kuwait Fund. Consideration is also being given to ruralelectrification mainly through mini-hydro schemes. While there are no activegeneration projects in Rwanda, several transmission line projects of 70 kV,30 kV and 15 kV are being constructed, or will be started shortly, financedby Belgium, Switzerland and the FED. The second Gisenyi hydroelectricproject (1.1 MW) financed by KfW has not yet started, but the transmissionline linking the nearby Ghira site to Ruhengeri is expected to be completedby 1984. KfW will also fund repairs to the distribution system in severalsmall towns. The only active power project in Kivu at this time is a 110 kVtransmission line from Katana to Goma, which is being financed andconstructed by Yugoslavia. Completion is expected at the end of 1984. Atthe same time, Yugoslavia will upgrade the 70kV line from Ruzizi I to Katanato 110 kV.

Government Strategies in the Energy Sector

45. As noted previously, the major problems facing the region are de-forestation and the need to reduce dependence on the expensive and unreliablesupply of petroleum products. No long term strategy for the Region as awhole has yet been formulated by the governments or the regional energyentity, EGL. In the short and medium terms, there is a consensus thatdevelopment of hydroelectric resources is a priority. The first step to betaken jointly by the three governments is the development of the Ruzizi IIsite which would help meet the Region's needs until the early 1990's. Ineach country, complementary investments to rehabilitate and expand thetransmission/distribution network will need to be undertaken by the threenational electricity companies (para. 72).

46. Burundi. Burundi has virtually no domestic sources of electricalenergy, making development of its indigenous resources an even greater prior-ity. Recent efforts to promote the use of peat have been fairly successfuland future consumption is expected to expand significantly. To reducedependence on imported electricity, Burundi, has decided to proceed with theRwegura hydroelectric project. However, even in the short term, Rwegurawould not be sufficient to meet Burundi's needs. Therefore, Burundi hasdecided to participate in the Ruzizi II project as well.

47. Rwanda. Confronted with the major problems of deforestation andunreliable petroleum supply (para. 38), the Government of Rwanda has givenvery high priority to increasing the availability of electricity. TheGovernment recognizes that the Ruzizi II hydroelectric project is presentlythe most eonomic means of meeting short-term demand requirements necessaryfor its economic development.

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48. Zaire. Kivu province is relatively isolated from the rest of thecountry and, in the past, the Zairian Government has not been active indeveloping Kivu's energy potential. However, it now recognizes the need foradditional electrical power generating facilities in the Region, and hasjoined with Burundi and Rwanda in the promotion of the Ruzizi II project.

IDA Assistance to the Power Sub-Sector

49. IDA has not made previous loans to the power sub-sectors of eitherBurundi or Rwanda; in April 1982, the Association approved Credit No. 1224-ZR for the Shaba Power System Rehabilitation Project in south-east Zaire. Inview of the projected shortages of power in the Great Lakes Region, develop-ment of an indigenous source to support the domestic and industrial sectorsof the Region is an urgent priority. The Association's strategy for theRegion is to support regional cooperation and development of the least costmeans of increasing the supply of electrical energy, strengthening thenational electricity companies and exploring alternative sources of renewableenergy.

PART IV - THE PROJECT

50. The proposed project was identified as a result of a studyinitiated by the energy agency of the Great Lakes Region (EGL) financed bythe Fonds Europeen de Dgveloppement (FED). Negotiations were held from March31, 1983 to April 5, 1983. The delegation of Burundi was headed by Mr.Isidore Nyaboya, Minister of Public Works and Energy; the delegation ofRwanda was headed by Mr. Joseph Nzirorera, Minister of Public Works andEnergy; and the delegation of Zaire was headed by Mr. Umba Kyamitala,Minister of Mines and Energy. Mr. Mbafumoya Tchomba, Director General of EGLwas authorized to negotiate the Project Agreement on behalf of SINELAC. Areport entitled "Staff Appraisal Report, Ruzizi II, Regional HydroelectricPower Project", Report No. 4303-EAF dated May 3, 1983, is being distributedseparately to the Executive Directors. Supplementary Project data arecontained in Annex III.

Ruzizi II and the Great Lakes Region

51. EGL, the Organisation de la CEPGL pour ltenergie des pays desgrands lacs whose primary responsibility is to promote the electrification ofthe region was the initiator of the Ruzizi II project. In 1976, it launcheda study financed by FED to develop a complex on the Ruzizi river, which formsa boundary between Zaire and the other two countries. The original proposalfor a 120 MW facility proved too large for the Region's prospective needs; asecond study, also financed by FED, was initiated in 1979 and proposed thedevelopment of a 40 MW project.

52. The proposed Ruzizi II facility would be located some 15 km down-stream of the Ruzizi I facility which is currently the main supplier of

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electricity to the Region (para. 42). Ruzizi II would be developed in twostages: the proposed project would finance the first two units totallingabout 27 MW, while a third unit would be installed in 1993. Ruzizi II wouldprovide generating capacity to avoid a forecast shortage in the region after1986. The Ruzizi II facility will be owned in equal parts by the threeGovernments of the Region which have agreed to create an internationalcompany (SINELAC) to build and thereafter operate it (para. 58).

Objectives

53. The main objective of the proposed project is to expand the supplyof electricity to the interconnected system serving Burundi, Rwanda and Zairein order to sustain the economic growth of their industrial, commercial anddomestic sectors through 1995.

Project Description

54. The project would include:

- construction of hydroelectric generating facilities, in-cluding a dam, powerhouse, switching station and transmis-sion line;

- technical assistance for review of project design, super-vision of construction, initial operation and maintenanceof the facility, dam safety inspection and studies.

55. Civil Works and Equipment for the Generating Facilities. A con-crete gravity dam to be constructed at the head of a series of rapids on theRuzizi river, would control the flow of water through a 6 m diameter tunnel,500 m long, to a conventional above ground powerhouse located near the footof the rapids. Two 13.3 MW generating units would be installed in the powerhouse with provision for a third unit to be added when warranted by thegrowth of electricity demand in the region (forecast for 1993). The initialtwo-unit installation would provide about 140 GWh of electrical energy in anaverage water year. Three single phase transformers and one sparetransformer would be located in an outdoor switching station adjacent to thepowerhouse to raise the power produced to 110 kV for transmission to Rwanda,Zaire and Burundi (the latter will require completion of a transmission lineto be constructed under a separate project). Local access roads and staffhousing would also be constructed in proximity to the construction area.

56. Technical Assistance. Project preparation work was carried out byEGL and consultants financed by the FED and the Association. Three advancesfrom the Project Preparation Facility of US$65,000 each financed the servicesof (i) engineering experts for a review of design criteria, new costestimates, redesign of the switching station and environmental studies; and(ii) a legal adviser to complete the legal arrangements for SINELAC. Forproject implementation, approximately 30 man-months of experts' services willbe needed to analyze tenders, provide final design assistance, coordinate and

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control equipment supply and installation. Because of the scarcity ofexperienced local technicians, about 12 man-years of experts' services wouldbe provided by a management team to monitor construction of generatingfacilities and to advise on technical aspects, particularly dam and tunnelworks, as well as additional works or equipment which might be proposed byconsultants during the construction period. After commissioning, themanagement team would assist SINELAC with operation and maintenance of thefacility for about two years (6 man-years). The services of a panel ofexperts (para. 60) would also be required during project implementation toadvise on dam and safety requirements.

57. Training. Provision will be made that the experts of the manage-ment team would each train one or two local staff, seconded by the nationalelectricity companies, who will eventually replace the team. No technicaltraining facilities for the power subsector exist in Burundi or Rwanda; andZaire's training school is 1,500 km from the Ruzizi site. Proposals for aregional training facility to supply staff for the Ruzizi II facility and thethree national companies will therefore be studied to review thejustification and determine the the size and location of such a school,design a training program, and estimate the number of instructors and thefunds required to maintain the facility.

Framework for Project Implementation

58. The question of the most suitable institutional framework for theimplementation of the project was debated at length by the Governments con-cerned. While a regional energy entity, EGL, exists, its mandate is to studyand promote energy development rather than to execute or operate developmentprojects. Therefore, the three governments agreed to create an internationalcompany, the Socifte Internationale d'Electricite des Pays des Grands Lacs(SINELAC) to construct and operate the Ruzizi II facility. SINELAC would bea multinational public enterprise established for a fifty year renewableperiod. The Governments of Burundi, Rwanda and Zaire contribute equally toSINELAC's capital, each owning one third of the company. The legal andcontractual framework in which SINELAC will operate was devised to: (i) fitwithin the regional organization already in place; (ii) ensure that it willbe operated as a commercial entity; and (iii) maintain a balance in thebenefits that will accrue to the three countries participating in theproposed project. Ratification of the Treaty and By-laws establishingSINELAC is scheduled to take place no later than July 1983; in order thatthe project executing entity be established before IDA funds are committed,ratification would be a condition of signature of the IDA Credits. Thetransfer by the three Governments of all land and rights in respect of landrequired for SINELAC to carry out the Project would be a condition of CreditEffectiveness (Section 6.01 (e) of the draft Development Credit Agreements).

59. Day-to-day operations of SINELAC will be entrusted to a ManagementCommittee composed of three members (one from each country) headed by aGeneral Manager. A Board of Directors, consisting of six members (two fromeach country) will supervise the Management Committee and decide on the com-pany's policies. SINELAC will be governed by a General Assembly, consistingof the three Ministers of Energy with powers over appointment/dismissal ofthe General Manager, Board of Directors and certain financial staff, andapproval of SINELAC's budget. A condition of Credit Effectiveness would be

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that an individual with qualifications and experience satisfactory to theAssociation has taken up the position of General Manager on a full-time basis(Section 6.01 (f) of the draft Development Credit Agreements).

60. During the project implementation period, assistance to the SINELACGeneral Manager would be provided by technical experts. An administrativeand financial assistant to the General Manager has been recruited, financedby the FED. To monitor the construction, advise and assist in the initialoperation of the Ruzizi II facility, SINELAC would retain a management teamof technical experts comprising one civil, one mechanical and electricalengineer and a chief accountant, all with appropriate experience gained at aninternationally known utility company. At the time of commissioning of thefacilities, about 75 staff would be required to be in place; approximately25 of these staff would be semi-skilled technical and administrative staffseconded from the three national electricity companies. Assurances wereobtained that: (i) SINELAC would employ after construction on a full-timebasis a Technical Director and a Financial and Administrative Director whosequalifications and experience would be acceptable to the Association (Section3.04 (b) of the draft Project Agreement); (ii) the civil engineer of theteam of technical experts would be employed by December 31, 1983, the chiefaccountant by June 30, 1984 and the mechanical and electrical engineer byDecember 31, 1985; the last two experts would remain employed at least twoyears after commissioning (Section 2.02 (a) of the draft Project Agreement);and (iii) suitably qualified and experienced personnel, to be trained by theexperts of the management team, would be assigned by REGIDESO, ELECTROGAZ andSNEL to SINELAC when the team members have taken up their positions (Section3.04 of the draft Development Credit Agreements). SINELAC will receiveadditional assistance from a panel of experts who would review the adequacyof design and safety of the dam and related structures, and conduct periodicreviews of the design during, and for a limited period following,construction (Section 2.02 (a) of the draft Project Agreement). In addition,consultants to be selected by December 31, 1983 will carry out the study fora regional training facility (Section 2.02 (a) of the draft ProjectAgreement). All experts financed by the Association would havequalifications, experience, terms and conditions of employment satisfactoryto the Association and would be selected in accordance with the Bank GroupGuidelines for the Use of Consultants.

61. Although SINELAC would be formed to manage and operate the RuziziII facilities, it could acquire and operate other electric powerinstallations. However, prior to undertaking any investment in addition tothe proposed project, SINELAC would review and discuss this investment withthe Association; any proposed investment in excess of US$500,000 equivalentwould not be undertaken without the Association's prior approval (Section4.06 of the draft Project Agreement).

62. In its relations with its shareholder-Governments and the nationalelectricity Companies, SINELAC would receive revenue and pay debt service anddividends in the three national currencies. Free convertibility wouldtherefore be necessary for all operating activities of the Ruzizi IIfacilities. Furthermore, SINELAC would need to purchase foreign exchangefrom time to time during the period of Ruzizi II operation. Each CentralBank would (a) maintain at all times the free convertibility between theBurundi franc, Rwandese franc and zaire for SINELAC's quarterly bank account

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balances; and (b) provide SINELAC with foreign exchange required formaintenance and renewal of the facilities and audits (Section 4.04 of thedraft Development Credit Agreements).

63. Financing of SINELAC's Cash Expenditures. In order to ensure thatSINELAC's cash requirements are met in the early years of operation of theRuzizi II facilities, each electricity company would be required to provideSINELAC with at least one third of the funds needed to cover expenditures foroperation, maintenance and debt service. This minimum payment would be madeeven if the electricity company required less than the quantity of electrici-ty which the minimum payment could purchase. In cases where a company'selectricity needs are greater than the purchase allowed by the minimum pay-ment, the excess would be used to reduce equally and proportionally the mini-mum payment of the other companies. A formula for calculating the minimumpayment as well as the bulk tariff (described in para. 64 below) will berecorded in contracts to be signed between SINELAC and each of the threeelectricity companies as a condition of Credit Effectiveness (Sections 4.03and 6.01 (d) of the draft Development Credit Agreements).

64. Tariffs. SINELAC will operate as a commercial utility. Adjustmentof SINELAC's tariffs would be carried out regularly by its Management Commit-tee and submitted to its Board of Directors for approval; if no disagreementis registered by the Board within 60 days, the tariffs would automatically beapplied. SINELAC's tariffs for the bulk sale of electricity to the three na-tional electricity companies would be established at a level to achieve a 10percent financial rate of return, which would be sufficient to ensure a soundfinancial position for SINELAC. Computation of the tariff would be based onthe cost of the project and forecast sales from Ruzizi II. Based on thecosts as estimated in the consultants' engineering studies, the averagetariff would be US d 8.4/kWh after transmission and distribution losses, inconstant 1982 prices. At least eight months prior to the forecast date ofcommissioning, when the cost of construction is well established, SINELACwould employ a consultant, to make a new calculation based on an updateddemand forecast for electricity, of the average tariff that would obtain a 10percent financial rate of return for the proposed project. No later thanthree months prior to the date estimated for the commissioning of the facili-ties, SINELAC would furnish to the Association the report of the consultant(Sections 2.02 (a) and 4.05 (a) of the draft Project Agreement). Each yearthereafter, SINELAC will review its tariffs in consultation with the Associa-tion (Section 4.05 (b) and (c) of the draft Project Agreement) at the time ofthe preparation of its budget. It is estimated that the resulting level ofearnings would be sufficient to finance a third unit of 13.3 MW for Ruzizi IIto be commissioned in 1993. Should SINELAC accummulate cash in excess of itsforeseen requirements, its Board of Directors could decide to distributedividends to its shareholders.

Cost Estimates

65. The total project cost is estimated at US$84.9 million of whichUS$72.7 million is foreign exchange (86 percent of total project cost).These costs are net of duties and taxes, reflecting agreement of the three

Governments to exempt the project from these costs. A detailed breakdown ofproject costs is shown in the Summary of the Credits and Project. Costestimates are based on September 1982 prices. Physical contingencies of 15percent were applied to the costs of civil works, roads and housing to allowfor possible increase in quantities due to foundation and structuralconditions; physical contingencies of 10 percent were applied to all otheritems. Except for the technical assistance component, price contingencies of8 percent in 1983; 7.5 percent in 1984; 7 percent in 1985; and 6 percentin 1986 and 1987 were applied to the base costs plus physical contingenciesto obtain the total project cost of US$84.9 million. The local currencyapplicable for the project would be the zaire since most works will becarried out on Zaire's territory. It is standard practice for projects inZaire to take domestic inflation into account by calculating costs in USdollars and assuming that the progressive devaluation of the zaire wouldcompensate for local price increases. The cost of consultants' servicesranges from US$8,500 per man-month 'or the training study to US$12,000 perman-month for the panel of experts; these costs include salaries, travel,subsistence and miscellaneous expenses. Interest during construction wouldbe capitalized, and would amount to US$46 million over the eight-year graceperiod for the onlending of the IDA credit, and the ten-year grace period forthe FED credit.

Financing Plan

66. Co-financiers' funds, totalling US$75.9 million, would cover 100percent of the foreign exchange cost and 26 percent of the local costequivalent, or 89 percent of the estimated project cost, excluding interestduring construction. The three IDA credits, totalling US$45 million (US$15million to each of the three Governments), would finance 53 percent of theestimated project cost, representing 62 percent of the estimated foreignexchange component. The IDA credits would finance civil works and technicalassistance. A FED loan of US$16.8 million equivalent and a grant of US$3.7million equivalent would finance hydraulic equipment, turbines, externalelectrical equipment and the cost of engineering design and supervision. Agrant from the Italian Government in the amount of US$8.5 million equivalentwould be used to finance generators and powerhouse electrical equipment. Aloan of US$1.9 million from the Banque de Developpement des Etats des GrandsLacs (BDEGL) would be used to finance construction of roads and staffhouses. The Governments of Burundi, Rwanda and Zaire would each provide theequivalent of US$3 million to cover the local costs related to civil worksand technical assistance; these funds would be obtained through internalcash generation of the three national electricity companies (see para. 73).

67. The proceeds of the IDA credits would be on-lent by the Governmentsto SINELAC for 25 years, including an 8 year-grace period, at 10.97 percent.Signature of Subsidiary Loan Agreements between SINELAC and each of the threeGovernments would be a condition of Credit Effectiveness (Section 6.01 (a) ofthe draft Development Credit Agreements). The FED loans to the threeGovernments would be for a period of 40 years, with 10 years grace at aninterest rate of one percent per annum and would be on-lent to SINELAC on thesame terms. Interest during construction related to the IDA credits and FEDloan amounting to US$46 million would be capitalized and repaid by SINELACfrom the revenues of its sales of electricity. The three Governments would

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pass on the Italian funds as grants to SINELAC. SINELAC would obtain a loandirectly from BDEGL at 7.5 percent interest for 13 years with a three yeargrace period. Conditions of Credit Effectiveness would be that allconditions precedent to the initial disbursement of funds under thecofinanciers' agreements and under the Association's three Development CreditAgreements have been fulfilled (Sections 6.01 (b) and (c) of the draftDevelopment Credit Agreements).

Procurement

68. Procurement for work to be financed under the IDA Credits would belimited to the civil works contract and experts' services. Tenders for thecivil works contract have been called from prequalified contractors, whoresponded to a published notice in accordance with Bank Group guidelines forinternational competitive bidding. Procurement for mechanical and electricalequipment for the project would be in accordance with the individual lenders'requirements. The experts funded under the technical assistance componentwould be selected in accordance with Bank Group Guidelines for the Use ofConsultants.

Disbursements

69. The proceeds of the three credits would be disbursed over sixyears; each credit would finance one-third of the following: 87 percent ofthe total expenditure for the civil works (US$30 million); 100 percent ofthe foreign cost of technical assistance (US$3 million); 100 percent of theforeign cost of audits (US$105,000); and a refunding of the advances fromthe Project Preparation facility (US$195,000). Unallocated funds totalUS$11,700,000. All expenditures would be fully documented. The closingdate for the credits would be September 30, 1989.

Accounts and Audits

70. SINELAC's accounts would be established with the assistance of thechief accountant of the management team of technical experts. During theconstruction period, SINELAC's accounts, including separate accountsrecording all withdrawals made by SINELAC under the Credits, would be auditedby an independent auditor acceptable to the Association and financed by thethree IDA Credits. Beginning in 1987, when the facilities are commissioned,SINELAC's accounts would be audited by independent auditors acceptable to theAssociation and the audited accounts and auditors' report would be madeavailable to the Association no later than six months after the end of eachfinancial year (Section 4.02 of the draft Project Agreement).

Impact of the Project on National Electricity Companies

71. The three national electricity companies, REGIDESO, ELECTROGAZ andSNEL, would be the sole customers of SINELAC and would contribute out oftheir own revenues the share of total project cost to be financed by eachGovernment (para. 66). Because of their relationship with SINELAC, theAssociation would require information on the financial position of the three

- 23 -

companies, as follows: (i) REGIDESO would continue to provide separateannual financial statements for its electricity and water operations, and arevaluation of its fixed assets; would continue to have its accounts auditedeach year by a firm acceptable to the Association, and submit to theAssociation financial statements and the auditor's report no later than sixmonths after the end of the financial year (Section 4.09 of the draft BurundiDevelopment Credit Agreement); (ii) ELECTROGAZ would have its annualaccounts audited by independent auditors acceptable to the Association andsubmit them within six months of the end of each financial year (Section 4X09of the draft Rwanda Development Credit Agreement); and (iii) SNEL wouldprepare financial statements for the Kivu interconnected system as part ofthe accounting of SNEL's Eastern Region; SNEL's accounts, including Kivu'sannual accounts, would be audited by external auditors acceptable to theAssociation, and audit reports and copies of the accounts would be forwardedto IDA within six months of the end of the financial year (Section 4.08 ofthe draft Zaire Development Credit Agreement).

72. While the proposed Ruzizi II project would increase electricitysupply, expansion of the national transmission and distribution networks willbe necessary to ensure optimal utilization of the electricity generated andmeet forecast demand. Studies have been initiated, financed by advances fromthe Project Preparation Facility, as follows: (i) Burundi has received anadvance of US$400,000 to study a transmission line linking Bujumbura andRuzizi II, distribution lines, and financial assistance to REGIDESO (accountsand tariffs); (ii) Rwanda has received an advance of US$440,000 to studyrehabilitation of the transmission system and a small hydropower plant, ex-pansion of its interconnected transmission network, costs of consumables toestablish a maintenance program and financial assistance to ELECTROGAZ (assetrevaluation and tariffs); and (iii) Zaire has received an advance ofUS$440,000 to study rehabilitation of the Ruzizi I facility and a portion ofits transmission and distribution systems, upgrading of a portion of itstransmission system, and the feasibility of constructing a thermal electricgenerating plant fueled by wood. Because the complementary works to rehabi-litate and expand the transmission and distribution networks are an importantelement in the usage of power generated by Ruzizi II, the three Governmentswould agree to carry out these works based on the recommendationsof the abovestudies (Section 4.10 of the Burundi and Rwanda, and Section 4.09 of theZaire draft Development Credit Agreements).

73. The national electricity companies will finance their respectiveGovernment's contribution to the proposed project through adjustment oftariffs (US$3 million in construction and technical assistance expendituresand working capital and US$0.5 million in paid-in interest and charges duringconstruction) (Section 3.01 (b) of the draft Development Credit Agreements).The payment by each Government to SINELAC of US$100,000 as a contributiontowards its working capital requirements would be a condition of CreditEffectiveness (Section 6.01 (g) of the draft Development Credit Agreements).The electricity companies also would be expected to eventually finance thelocal counterpart to the related transmission and distribution worksdescribed in paragraph 72 above. To finance the Governments' contribution toSINELAC and complementary investments, it is estimated that tariffs inconstant prices would have to be raised substantially in Burundi and Zaire,

- 24 -

above their respective 1982 level of US.¢ 9.1 per kWh and US.¢ 3.7 kWh;however, it is likely that, due to a recent adjustment, no increase will benecessary in Rwanda where the electricity price is currently US¢ 12.5 perkWh. In the case of REGIDESO and ELECTROGAZ, tariff studies are beingcarried out through advances from the Project Preparation Facility as notedabove; ELECTROGAZ will also have its assets revalued by consultants financedby the advance. Provision has been made under the Shaba Power SystemRehabilitation Project (Credit 1224-ZR) for studies to revalue SNEL's assetsand to eliminate disparities in its tariff structure to be completed in1984. Until the aforementioned studies have been completed and reliable costestimates are available, no adjustment of retail tariffs related to theproject is proposed. REGIDESO would carry out its tariff study by December31, 1983 (Section 4.06 of the draft Burundi Development Credit Agreement).ELECTROGAZ would revalue its assets at the end of each fiscal year andcomplete its tariff study by December 31, 1983 (Sections 4.06 and 4.07 of thedraft Rwanda Development Credit Agreement). SNEL would undertake to carryout annual asset revaluations (Sections 4.06 of the draft Zaire DevelopmentCredit Agreement).

Justification

74. Electricity sales in the Great Lakes Region grew rapidly during theperiod 1977-81, averaging 10 percent annually for the region as a whole. InBurundi, fairly rapid growth in electricity demand (13 percent overall) re-sulted mainly from expansion in the industrial sector. More moderate growthis projected for the commercial, industrial and household sectors resultingin estimated growth averaging 12 percent for the 1982-90 period. Rwanda hasexperienced significant growth in both the domestic (25 percent) andcommercial (20 percent) sectors as a result of recent expansion of itstransmission system. These high rates are expected to decline as thepressure of suppressed domestic demand diminishes. Demand growth averaging 9percent per annum is estimated for Rwanda over 1982-90. Limited informationis available on past sales to Zaire's Kivu region. Few investments have beenmade to expand distribution in that region. Construction of a transmissionline from Katana to Goma is scheduled for completion by end-1984 andtransmission and distribution works complementary to the Ruzizi II projectwould serve to relieve suppressed demand in the region. Average annualgrowth rates for the Kivu region therefore are estimated to average 13percent for the 1982-90 period.

75. The expected growth in demand for electrical energy in the inter-connected system implies that supply from existing facilities in the regionwould be inadequate by 1986. The Bank Group considered two alternatives forsupplying the region: (i) the proposed Ruzizi II facility with an initialcapacity of 26.6 MW at a cost of US$85 million; and (ii) the Rwegura facilitywith a capacity of 18 MW at a cost of US$74 million; after thorough reviewof both projects, the Bank Group chose to support the Ruzizi II project onthe basis that it is the least cost solution. The Government of Burundi has,however, obtained sufficient external financing, mostly on concessionalterms, to proceed with the Rwegura project. If neither the Ruzizi II nor theRwegura project were built, a shortage of 27 GWh would appear in 1987 and

- 25 -

grow annually at a rate of about 30 GWh. If both Ruzizi II and Rwegura arecommissioned in 1987 as scheduled, the region would be oversupplied forapproximately two years. However, the probability of simultaneous entry onstream of the two facilities is low given the technical complexities of theRwegura project. A more realistic completion data for the Rwegura project is1989 -- in which case there would be no oversupply.

Economic Rate of Return

76. As noted in paragraph 64, an average bulk tariff of US ¢ 8.4/kWhwould yield a 10 percent rate of return on the Ruzizi II facilities.However, the sale of power from Ruzizi II would depend partly on subsequentworks to rehabilitate and expand the national distribution networks, whichthe three countries have agreed to undertake (para. 72). An appropriate rateof return should therefore be estimated on the basis of the cost of both thehydro facilities and the transmission/distribution works. An average retailtariff based on preliminary estimates for the cost of transmission/distribution works was estimated at US e 11.4/kWh in 1982 prices (bulk tariffplus transmission and distribution costs of US ¢ 3.0/kWh). This averageretail tariff would yield a 9 percent rate of return. This is, however, aminimum estimate of the true economic rate of return since there are benefitswhich are not captured and which are derived from the availability ofhydropower rather than higher cost diesel-generated power that some consumerswould be ready to buy. Financial forecasts for the three nationalelectricity companies indicate that the average tariff could be attained in1987 and thereafter.

Environmental and Riparian Aspects

77. The Ruzizi river flows 150 km from Lake Kivu in the north with LakeTanganyika in the south. Lake Kivu serves as a boundary between Zaire andRwanda; the Ruzizi river forms Zaire's boundary with Burundi and Rwanda; andLake Tanganyika serves as a boundary for Zaire, Burundi, Tanzania andZambia. The proposed Ruzizi II complex would be located 15 km below theoutlet of Lake Kivu and about 130 km upstream where the Ruzizi riverdischarges into Lake Tanganyika. The flow to Ruzizi II would be controlledby the Ruzizi I dam which lies upstream and regulates the level of LakeKivu. Water removed above the Ruzizi II dam would be returned to the riverabout 500 meters downstream, and after falling about 30 meters. The effecton the Ruzizi river flow will, therefore, be almost nil except for the 500meter expanse, where the volume of flow will vary depending on the demand forpower and with the seasons. Because the effects of the project on the riverare negligible, use of the river raises no issues related to internationalwater rights with the downstream states who have, in any event, been informedof the project and expressed no objections. The three Governments alsoagreed, not to act or allow any action to be taken which would affect theavailability of natural resources (including water flow from Lake Kivu to theRuzizi river) essential to the project. These arrangements are satisfactoryto the Association.

- 26 -

78. The dam and generating station would also have little effect onthe daily lives of the inhabitants in the immediate vicinity of the proposedsite, because the river water upstream of the dam would be raised only about2 m above its present maximum level during a peak flood. Compensation wouldbe paid for the removal of about 30 dwellings housing 200 persons, whichrequire relocation to provide space for construction activities and accessroads. All water diverted into the powerhouse to drive the turbines would bereturned to the river unadulterated. A fish ladder would be incorporated inthe facility to permit the passage of fish around the powerhouse and damduring the migration season.

Risks

79. Possible risks faced by the project are associated withconstruction works, with the operation of SINELAC and with a slower thananticipated growth of demand for electricity. Civil works present minimalrisks in view of the relatively simple design of the proposed facility; otherconstruction risks have been minimized by the requirement for SINELAC toretain consultants with adequate experience to carry out design and reviewprocurement procedures (para. 56), as well as a panel of experts to advise ondam safety (para. 62). In addition, the management team of technical expertswill provide continuing assistance during the construction period (para.61). The risk of delays is more serious because of the landlocked locationof the site and the dearth of adequate transportation facilities in theregion. This risk would be lessened through good planning facilitated by thepresence of the experts mentioned above. The possibility of cost overruns issmall since some tenders have been received and major costs have beenidentified.

80. The risks associated with SINELAC's operation derive from therelative complexity of the relations between the three Governments and theirdistribution companies on the one hand, and a newly created, henceinexperienced, company. Cooperation among the Governments, directly andthrough EGL, should not raise problems given their interest in SINELAC'ssmooth operation. The record of past cooperation within the framework ofRuzizi I is quite positive. Moreover, the relations between the variousparties has been defined in the comprehensive legal and contractual frameworklinking them and aimed at ensuring SINELAC's sound financial position.Internally, SINELAC will be managed with the help of a management team for atleast two years after commissioning.

81. A third possible risk would be that the anticipated rate of growthof demand does not materialize. The risk is minimal since load forecasts foreach country have been calculated quite conservatively and the completion oftransmission/distribution works is expected to generate a substantial amountof additional demand. Moreover, demand projections and the tariff to beapplied by SINELAC will be recomputed by consultants three months beforecommissioning of the Project facility; thus reducing the financial impact onSINELAC of a decrease in forecast demand.

- 27 -

PART V - LEGAL INSTRUMENTS AND AUTHORITY

82. The draft Development Credit Agreements between the Republic ofBurundi, the Rwandese Republic and the Republic of Zaire and the Association,the draft Project Agreement between SINELAC and the Association and theRecommendations of the Committee provided for in Article V, Section 1 (d) ofthe Articles of Agreement of the Association are being distributed to theExecutive Directors separately. Special conditions of the project are listedin Section III of Annex III. A condition of Credit signing would beratification of the Articles of Agreement and By-laws establishingSINELAC (para. 58). Special conditions of Effectiveness of the three Creditswould be: (i) transfer of the land and rights in respect of land requiredfor carrying out the project (para. 58); (ii) that the General Manager ofSINELAC shall have taken up his position (para. 59); (iii) completion ofcontractual arrangements for the sale of power from Ruzizi II to the threenational electricity companies (para. 63); (iv) payment by each Governmentto SINELAC of US$100,000 each as a contribution towards its working capitalrequirements (para. 73); (v) execution of the subsidiary loan agreementsbetween Burundi, Rwanda and Zaire, and SINELAC (para. 67); and (vi)fulfillment of all conditions precedent to initial disbursement ofcofinanciers' funds (para. 67).

83. I am satisfied that the proposed Development Credits would complywith the Articles of Agreement of the Association.

PART VI - RECOMMENDATION

84. I recommend that the Executive Directors approve the three proposedcredits.

A. W. Clausen,President

Attachments

May 5, 1983Washington, D.C.

- 28 - ANNEX 1APage 1 of 7

TABLE 3ABURUNDI - SOCIAL INDICATORS DATA SHEET

BURUNDI REFERENCE GROUPS (WEIGHTED AVEAGESAREA (THOUSAND SQ. KM.) - HOST RECENT ESTIMATE)-

TOTAL 27.8 MOST RECENT LOW INCOME MIDDLE INCOMEAGRICULTURAL 17.2 1960 /b 1970 lb ESTIMIATE /b AFRICA SOUTH OF SAHARA AFRICA SOUTH OF SAHARA

GNP PER CAPITA (USS) 60.0 200.0 235.0 1/ 250.8 1053.2

ENERGY CONSUPUTION PER CAPITA

(EILOr.RAMS OF COAL EQUIVALENT) 10.81c 10.8 16.6 66.5 610.1

POPULATION AND VITAL STATISTICSPOPIULATION, MID-YEAR (THOUSANDS) 2851.0 3350.0 4097.0URBAN POPULATION (PERCENT OF TOTAL) 2.2 2.2 2.3 11.8 28.3

POPULATION PROJECTIONSPOPULATION IN YEAR 2000 (MILLIONS) 6.8STATIONARY POPULATION (MILLIONS) 18.2YEAR STATIONARY POPULATION IS REACHED 2130

POPULATION DENSITYPER SQ. KM. 102.4 120.4 144.5 27.7 54.7PER SQ. NM. AGRICULTURAL LAND 176.0 203.4 233.6 86.7 129.9

POPULATION AGE STRUCTURE (PERCENT)0-14 YRS. 42.6 43.8 43.9 44.8 46.0

15-64 YRS. 54.6 53.2 53.0 52.3 51.1

65 YRS. AND ABOVE 2.9 3.0 3.1 2.9 2.8

POPULATION GRONTH RATE (PERCENT)

TOTAL 1.6 1.6 2.0 2.7 2.8URBAN 1.6 1.6 2.5 6.2 5.2

CRUDE BIRTH RATE (PER THOUSAND) 46.9 44.4 45.5 47.3 47.2CRUDE DEATH RATE (PER THOUSAND) 26.7 24.1 22.2 19.5 15.7GROSS REPRODUCTION RATE 3.0 2.9 3.1 3.2 3.2FAMILY PLANNING

ACCEPTORS, ANNUAL (THOUSANDS) .. ..USERS (PERCENT OF MARRIED WOMEN) .. ..

FOOD AND NUTRITION

INDEX OF FOOD PRODUCTION

PER CAPITA (1969-71-100) 103.0 100.0 99.0 88.7 90.7

PER CAPITA SUPPLY OFCALORIES (PERCENT OF

REQIIREMENTS) 97.3 98.4 99.1/d 90.2 93.9PROTEINS (GRAMS PER DAY) 60.2 60.7 61.2/d 53.1 54.8

OF WHICH ANIMAL AND PULSE 30.1 29.7 30.6/d 18.4 17.0

CHILD (AGES 1-4) MORTALITY RATE 32.8 29.4 24.6 26.7 23.9

HEALTHLIFE EXPECTANCY AT BIRTH (YEARS) 37.2 39.7 41.9 45.6 51.0INFANT MORTALITY RATE (PER

THOUSAND) 150.3 138.7 121.6 129.9 118.5

ACCESS TO SAFE WATER (PERCENT OFPOPULATION)

TOTAL .. .. .. 23.9IRBAN ' 77.0 94.0 54.9

RURA. .. .. .. 18.5

ACCESS TO EXCRETA DISPOSAL (PERCENTOF POPULATION)

TOTAL .. .. .. 25.8URBAN * 96.0 95.0 63.1

RURAL .. .. .. 20.2

POPULATION PER PHYSICIAN 96566.7 55833.3 45020.0/e 32097.3 14185.2POPULATION PER NURSING PERSON 4526.6 7494.4 6180.0/e 3264.6 2213.2POPULATION PER HOSPITAL BED

TOTAL 877.6 744.4 .. 1225.0 1036.4URBAN 27.3 113.4 .. 249.5 430.8

RURAL 3723.1 1074.9 .. 1712.1 3678.6

ADMISSIONS PER HOSPITAL BED .. ..

HOUSINGAVERAGE SIZE OF HOUSEHOLD

TOTAL .. ..URBAN .. ..RURAL 6 ..

AVERAGE NUMBER OF PERSONS PER ROOM

TOTA. .. ..URBAN .. ..RURAL .. ..

ACCESS TO ELECTRICITY (PERCENT

OF DWELLINGS)TOTAL .. ..

URBAN .. ..

RURAL

I/ Atlas mechodolugy (1979-81 base period) estimates.

-29- AMNEX 1APage 2 of 7

TABLE 3ADURUNI -- SOCIAL INDICATORS DATA SHEET

BURUNDI REFERENCE GROUPS (WEIGHTED AVERAGES- MOST RECENT ESTIM aTE)-

MOST RECENT LOW INCOME MIDDLE INCOME1960 /b 1970 /b ESTIMATE /b AFRICA SOUTH OF SAHARA AFRICA SOUTH OF SAHARA

EDUCATIONADJUSTED ENROLLMENT RATIOS

PRIMARY: TOTAL 18.0 27.0 23.0 LI 63.2 83.3MALE 27.0 37.0 28.0 12 72.7 96.1FEMALE 9.0 18.0 18.0 13 50.3 80.4

SECONDARY: TOTAL 1.0 2.0 2.0/4 10.2 15.3MALE 1.0 3.0 3.0 13.2 19.4FEMALE 1.0 1.0 2.016 6.6 11.3

VOCATIONAL ENROL. (% OF SECONDARY) 35.0 23.7 11.9/d /7 7.9 4.7

PUPIL-TEACHER RATIO IsPRIMARY 35.7 36.7 32.8- 47.4 38.6SECONDARY 14.9 11.2 18.8/d t9 26.2 23.4

ADULT LITERACY RATE (PERCENT) 13.9

/c .. 22.6 /1 34.0 35.6

CONSUMPTIONPASSENGER CARS PER THOUSAND

POPULATION 1.1 1.1 1.3/f 3.0 31.9RADIO RECEIVERS PER THOUSAND

POPULATION 20.0 19.4 37.3 34.8 71.8TV RECEIVERS PER THOUSAND

POPULATION .. .. .. 1.7 17.9

NEWSPAPER ("DAILY GENERALINTEREST") CIRCULATION PERTHOUSAND POPULATION .. 0.1 0.

4/e 2.9 19.1

CINEMA ANNUAL ATTENDANCE PER CAPITA 0.1/c .. 0.0 1.1 0.6

LABOR FORCETOTAL LABOR FORCE (THOUSANDS) 1494.5 1676.1 1944.6

FEMALE (PERCENT) 45.9 45.3 45.1 34.1 36.5AGRICULTURE (PERCENT) 90.0 87.0 84.0 78.4 56.5INDUSTRY (PERCENT) 3.0 4.0 5.0 9.2 17.7

PARTICIPATION RATE (PERCENT)TOTAL 52.4 50.0 47.5 41.4 37.0MALE 58.3 56.0 53.9 53.9 46.9FEMALE 46.9 44.4 41.5 29.1 27.2

ECONOMIC DEPENDENCY RATIO 0.9 0.9 1.0 1.2 1.3

INCOME DISTRIBUTIONPERCENT Of PRIVATE INCOMERECEIVED BY

HIGHEST 5 PERCENT OF HOUSEHOLDS ..

HIGHEST 20 PERCENT OF HCUSEHOLDS ..

LOWEST 20 PERCENT OF HOUSEHOLDSLOWEST 40 PERCENT OF HOUSEHOLDS ..

POVERTY TARGET GROUPSESTIMATED ABSOLUTE POVERTY INCO!tELEVEL (US$ PER CAPITA)

URBAN .. .. 213.0 134.3 507.0

RURAL .. .. 136.0 82.9 200.6

ESTIMATED RELATIVE POVERTY INCOMELEVEL (USS PER CAPITA)

URBAN .. .. .. 96.4 523.9

RURAL .. .. 37.0 60.4 203.6

ESTIMATED POPULATION BELOW ABSOLUTEPOVERTY INCOME LEVEL (PERCENT)

URBAN .. .. 55.0 39.3

RURAL .. .. 85.0 69.0

Not availableNot applicable.

NOTES

Ia The group averages for each indicator are population-weighted arithmetic means. Coverage of countriesamong the indicators depends on availability of data and is not uniform.

/b Unless otherwise noted, data for 1960 refer to any year between 1959 and 1961; for 1970, between 1969and 1971; and for Most Recent Estimate, between 1978 and 1980.

/c 1962; /d 1977; Ie 1975; /f 1976.

The following figures reflect the most recently available estinate3

1/ 29.0 2/ 35.0 3/ 23.0 4/ 2.6 5/ 3.5b/ 1.7 7/ 18.0 8/ 37.0 9/ 14.4 T0/ 25.0

February 1983

ANNEX IAPage 3 of 7

-30-

TABLE 3ARWANDA - SOCIAL INDICATORS DATA SHEET

-RWANDA REFERENCE CROUPS (WEIGHTED AVECAGZSAREA (THOUSAND SQ. EM.) - MOST RECENT ESTIMATE)-

TOTAL 26.3 MOST RECENT LOW INCOME MIDDLE INCOM.AGRICULTURAL 14.5 1960 /b 1970 /b ESTIKAIF lb AFRICA SOUTH OF SAHARA AFRICA SOLUTH OF SANARA

CNP PER CAPITA (USS) 70.0 100.0 239.0 250.8 1053.2

ENERGY CONSUMPTION PER CAPITA(KILOGRAMS OF COAL EQUIVALENT) 14.5 13.9 28.3 66.5 610.1

POPULATION AND VITAL STATISTICSPOPULATION, MID-YEAR (THOUSANDS) 2858.0 3695.0 SS10.0URBAN POPULATION (PERCENT OF TOTAL) 2.4 3.2 4.5 17.S 26.3

POPULATION PROJECTIONSPOPULATION IN YEAR 2000 (MILLIONS) 10.4STATIONARY POPLLATION (MILLIONS) 38.1YErAR STATIONARY POPULATION IS REACHED 2110

POPULATION DENSITYPER SQ. EM. 108.5 146.3 210.0 27.7 54.7PER SQ. EM. AGRICULTURAL LAND 189.3 240.7 393.0 86.7 129.9

POPULATION AGE STRUCTURE (PERCENT)0-14 YRS. 44.3 45.7 46.7 44.8 46.0

15-64 YRS. 53.0 51.6 50.6 52.3 51.165 YRS. AND ABOVE 2.7 2.7 2.7 2.9 2.8

POPULATION GROWTH RATE (PERCENT)TOTAL 2.6 2.6 3.6 2.7 2.8URBAN 5.4 5.4 6.3 6.2 5.2

CRUDE BIRTH RATE (PER THOUSAND) 51.2 .. 53.3 47.3 47.2CRUDE DEATH RATE (PER THiOUSAND) 27.2 22.3 20.1 19.5 15.7GROSS REPRODUCTION RATE .. .. 4.1 3.2 3.2FAMILY PLANNING

ACCEPTORS, ANNUAL (THOUSANDS) ..

USERS (PERCENT OF MARRIED WOMEN) ..

FOCD AD N'UTRITIONINDEX OF FOU PRODUCTION

pER CAPITA (1969-71'100) 81.0 102.0 105.0 88.7 90.7

PER CAPITA SUPPLY OFCALORIES (PERCENT OF

REQUIREMENTS) 83.3 95.6 94.2/c 90.2 93.9PROTEINS (GRAMS PER DAY) 50.7 61.0 57.077 53.1 54.8

OF WHICH ANIMAL AND PULSE 25.6 34.0 29.177 18.4 17.0

CHILD (AGES 1-4) MORTALITY RATE 32.0 30.5 29.0 26.7 23.9

HP.ALTHLIFE EXPECTANCY AT BIRTH (YEARS) 37.2 42.1 45.2 45.6 51.0INFANT MORTALITY RATE (PERTHOUSAND) 147.0 142.0 137.0 129.9 118.5

ACCESS TO SAFE WATER (PERCENT OFPOPULATION)

TOTAL .. .. 37.0/d 23.9URBAN .. ,, 47.0/1 54.9RURAL .- .. 37.0/1 18.5

ACCESS TO EXCRETA DISPOSAL (PERCENTOF POPULATION)TOTAL .. 53.0 57.0/e 25.8URBAN .. S3.0 87.07e 63.1RURAL .. 52.0 56.077 20.2

POPULATION PER PHYSICLAN 143285.7/f 59596.8 3S791.7/c 32097.3 14185.2POPULATION PER NURSING PERSON 11617.877 8818.6 10460.777 3264.6 2213.2POPULATION PER HOSPITAL BED

TOTAL . 790.4 650.0/c 1225.0 1036.4URBAN . 45.9 45.277 249.5 430.8RURAL *- 3097.0 1599.777 1712.1 3678.6

ADMISSIONS PER HOSPITAL BED .. 21.2 21.3.1

HOUSINGAVERAGE SIZE OF HOUSEHOLD

TOTAL .. ..URBAN * *'gtURAL 4.5/.

AVERACE NUMBER Of PERSONS PER ROOMTOrAL .. ..URBAN * --RURA .. .. . ..

ACCESS TO ELECTRICITY (PERCENTOF DWELLINGS)

TOTAL .. ..URBAN .. ..RUL .. ..

ANNEX IA

- 31 - age-4 of 7

TABLE 3AKWANl5r-0-IAL INDICATORS DATA SHEET

RWAIDA REPERCE GROUPS (WhICTED AVES- MDST RECENT ESTZHATE)-E

NDST RECENT LOW INCOME - IDLE INCOME-1960 /b 1970 /b ESTIMtAE /b ARICA SOUIH Of SAHARA AFRICA SOUTE OF SAUARA

EDUCATIONADJUSTED ENROLLMENT RATIOSPRIHARY: TOTAL 49.0 73.0 70.0 63.2 83.3

MALE 68.0 83.0 74.0 72.7 %.IFEMALE 30.0 64.0 67.0 50.3 60.4

SECONDARY: TOTAL 2.0 2.0 2.0 1Qr2 15.3MALE 2.0 3.0 3.0 13.2 19.4FEMALE 1.0 1.0 1.0 6.6 11.3

VOC&TIONAL ENROL. (2 OF SECONDARY) 39.9 12.2 16.7 7.9 4.7

PUPIL-TEACHER RATIOPRIMARY 38.6 59.7 53.2 47.4 38.6

SECONDARY 14.2 13.3 15.3 26.2 23.4

ADULT LITERACY RATE (PERCENT) 16.4/f 23.0/h 49.5 34.0 35.6

CONSU4PTIONPASSENGER CARS PER THOUSAND

POPULATION 0.4 0.9 1.5/c 3.0 31.9

'AD1O RECEIVERS PER THOUSAN?:POPULATION .. 8.1 30.1 34.8 71.8

TV RECEIVERS PER THOUSANDPOPULATION .. .. .. 1.7 17.9

NEWSPAPER '%'DAILY GENERALINTEREST') CIRCUIATION PERTHOUSAND POPULATION .. .. 0.04/c 2.9 19.1

CUIEMA ANNUAL ATrENDANCE PER CAPITA .. ., 14.657 1.1 0.6

LABOR FORCETOZA I;UEOR FORCE (THOUSANDS) 1617.8 2007.1 2679.8

FIMALE (PERCENT) 49.1 48.6 48.4 34.1 36.5

AGRICULTIUE (PERCENT) 95.0 93.0 91.0 79.4 56.5

INDUSTRY (PERCENT) 1.0 2.0 2.0 9.2 17.7

PARTICIPATION RATE (PERCENT)TOTAL 56.6 54.3 51.8 41.4 37.0

tALE 58.9 56.9 54.7 53.9 46.9

FINALE 54.4 51.9 49.1 29.1 27.2

ONOMIC DEPENDElCY RATIO 0.8 0.9 1.0 1.2 1.3

INCOME DISTRIBUTIONPERCENr OF PRIVATE INCOMERECEIVED BY

RIHWEST 5 PERCENT OF HOUSEHOLDS .. ..

RIGHEST 20 PERCENT OF HOUSEHOLDS .. .. .. ..

LOWEST 20 PERCENT OF HOUSEHOLDS .. ..

WEST 40 PERCENT OF HOUSEHOLDS .. ..

POVERTY TARGET GROUPSZSTIMAtED ABSOLUTE POVERTY INCOMELEVEL (USS PER CAPITA)

URAN ,. .. 148.0/c 134.3 507.0

RURAL .. .. S5.07 82.9 200.6

ZStIDATED RELATIVE POVERt`Y INCOMELEVEL (USS PER CAPITA)u-AN .. .. .. 96.4 523.9

RURAL .. .. 4

3.0/c 60.4 203.6

EStDiATED POPULATION BELOW ABSOLUTEPOVERTY INCOME LEVEL (PERCENT)URA .. ..

30.0/c 39.3

RURAL .. .. 90.07w 69.0

Not availableNot applicable.

NOTES

I. The group averages for each indicator are population-weighted arithmetc means. Coverage of countriesamong the indlcators depends on availability of data and is not uniform.

lb Unless othetwie. noted, data for 1960 refer to any year betw-.n 1959 and 1961; for 1970, between 1969and 1971; end for Most Rocent Estisate, btween 197S nd S2.

/e 1977; /d 1976; /a 1975; /f 1962; /A 1974; /h 1971. -

way, 1982

ANNEX IAPage 5 of 7

-32 -

TAlLZ 3ASA:EE - SOCIAL INDICATORS DATA SHEET

ZAE S TUERPNCE GROUPS (WEICNlED AVE;'ACESAE (TEA JOUSAND SO. YE.) - WDST RECENT ESTIIAt '- 4

SeAr RECENT LOW INCOME IvID 1::IOKCACaIru tUiAL 154.8 1960 /b 1970 /b ESTThATE /b AFRICA SOUTN Or SAMARA URICA SOt{'N Of SAWAPA

G PER CAPITA (tUSS) 90.0 140.0 220.0 250.8 1053.2

iWERIRT CONSUMPTION PER CAPITA(EiLOZGRl'S OF CC EQEiJALENT) 95.5 103.2 100.1 66.3 110.1

POFULATInS AtD VTI.1 STATISTICSSOPIULA,1100, (r RtICUSASOS) 17256.0 21163.0 282.91.0mSA2 POPULATION (PERCENT OF TOTAL) 15.7 21.6 34.0 17.S 8.

POPULATION PAtOECTIONSFOPULATIJN IN YEAR 2000 (MILL.ONS) 31.0STATIONAPY POPLLATION (MI_IC.IC) 156.0VEA! STATIC.URY POPULATION IS REACHED 2110

?OPULATlON DENSITY7ut SQ. rs. 7.6 9.2 11.7 27.7 54.1nER SQ. EL. ACiICULTURAL LAND 120.2 143.1 177.7 S6.7 129.1

POPULATION AGE STRUCTURE (PERCENT)0-14 YRS. 44.1 .3 44.7 44.8 44.0

15-44 IRS. 52.9 52.9 32.5 32.3 31.165 TES. ANiD AOVE 3.0 2.8 2.8 2.9 2.$

POPULIATION (SOWTR RIATE (PERCENT)TOTAL 2.2 2.0 2.7 2.7 2.8ODrAD .. 5.2 7.2 6.2 5.2

CRUOD BIRTH RATE (PER THOUSAND) 46.0 47.2 43.9 47.3 *7.2CRLGE IENTH RATE (PER THOUSAND) 24.3 21.5 17.9 * 19.3 13.7GROSS REPROILCTI IO RATE 3.0 3.0 3.0 3.2 3.2FAMISLY PLANNING

ACCEFIORS AN.NuL (THOUSANDS) .. ..Mias (£ERCNT OP IA.RED WOMEN) .. .. ..

J00D AND NUTRITILONLNrDix OF FO.)O PiOCVCTION

?El CAPITA (t1569-71-10) 101.0 101.0 68.0 U1.7 90.7

116 CAPITA SiPPLY OFCAORIES (PERCENT OF

REQUIEL'IENTS) 98.3 101.3 102.4/c 90.2 3.9ROTEINS (OSAMSl ?ER IAr) 35.9 37.4 35. 77 53.1 346.

r WHICEt ANIIA.L AND PULSE 13.1 12.7 9.97S 18.4 17.0

CasID (AGES I-4) tlORTALI:Y LATE 32.7 27.3 21.9 26.7 23.9

WEA;LTHl.IFP EXPECIANCY AT S11TH (YEARS) 40.0 42.7 47.1 43.6 51.0INrANT HORTALItY RArE (PERVIOUSAN) 130.0 132.0 112.0 129.9 118.3

ACCfSS TO SAE WATE (PERCENT OFIOPULATOI )

TOTAL .. 11.0 16.0/4 23.0on"I .. 33.0 43.071 34.9RURL .. 4.0 3.071 1s5.

ACCES TO 2XC12TA DISPOSAL (PERCETO POPUlATION)

torAL .. 5.0 22.0/4 25.4U .. 3.0 63.071 e 3..RURAL .. 3.0 6.071 20.:

1OPULATIOt PtE PH!SICXA.4 37621.4 30136.5 13329.3 32097.3 14193.2POPULATION FER NURSI4G PERSON 3511.7 2294.6 1419.9 3264.6 2213.29FPULATION PER HOSPITAL RID

TOTAL 230.8 320.0 339.0 1223.0 1036.4Us.s J1.2 86.8 144.9 249. : 430.8RURAL 770.5 1046.7 2623.4 1n72.1 36.6

ACASS1WHS "A HOSPITAL SED .. ..

AVERAGEt SIZE Of %OtiSEHOLDTOTAL ., ,* .

RUAL .. .. 6.0

avauRA R IGSU OP PERSONs n! woaTOTAL .. *. .SUANo . 0 .. ..0-.AL *.

Ccss To ELECTEICIrT (PRECUOr PAILU.!HS)

TAL .. , . .- ..* AN .. .. .. ..

ANNEX IAPage 6 of 7

- 33 -

TAPLE 'AZAIRE - SU±-V,L INTflCAI0RS DATA SH?IET

ZAIlZ REFZENCE GOIUS G VEICHTED AVERACES- #EOST RECENt ESTIKATE l /

115ST RECENT LOW INCOME MIDDLE INCOME1960 lb li;0 tb ESTIMATEg /b AFRICA SCUTH OF SAAM A-RICA SOUTH Or SAZA

AUS'.fD E.1OLL!.4F.T RATIOSftbY: tOTAL 60.0 63.0 90,0/i 63.2 83.3

KAE 66.0 10. 103.OF, 72.7 96.1. 7(hu 32.0 65.0 77.0Or 50.3 80.4

SECONARY: TOTAL 3.0 9.0 19.O/C 10.2 11.3PALE 4.0 13.0 23.07r 13.2 19.4JDLC 1.0 4.0 14.07; 6.6 11.3

VOCATIOrAL ENTIOL. ': OF SWCCMART) 26.S 9.6 1

3.2/c 7.9 4.7

MPI L-TFACHER RATIOnLHARAY 39.9 42.6 .. 47.4 38.4SECOZJOAPLy 20.3 20.. 27.0/c 26.2 23.4

AmL1 'LIT, CY WPE (VERCi'T) 31.3Jf 13.0 57.9 34.0 31.6

00NSUI0PIE0NPASSENGR CARS PER THOUSXND

3t0 A.TIOtU 3.0 3.0 3.6/j 3.0 31.0

NIIIO LICEIVEA.5 YER THOUSANDP0O?;LATIO% , 2.9 4.9 34.8 71.5

TV LFrEIVERS n5 71.OL'SANDKPULATION ., 0.3 0.3 1.7 17.9

UImSPAPER (0DA1Z.Y tEz.E?A.LINTE.EST-) ClkCULArION PER V.

OtUMSAND POPULATION . 1.2 9.2 1.6 2.9 19.1CI.NEMA SNNUL. ATTZNOANCE PER WCI:& 0.1 0.1 O.18 t.l 0.6

LABOR FORCEIttL sLuCCa FOntE nSAusm) e8215.5 9464.8 11636.5

FEMALE (PERCFNT) 45.4 44.5 42.6 34.1 36.5ACRICULTURE (07RCENT) 83.0 ,9.O 75.0 78.4 54.3LSDUSTRY (PERCENT) 9.0 11.0 13.0 9.2 17.7

PIRtICIP&TLOM MeL (PERCEEt)TOTAL 44.3 43.7 41.1 *1.4 37.0

MALE 5l.9 49.8 48.0 53.9 46.§1I.'SALE 41.2 38.0 34.5 29.1 27.2

ICOIOlIC DEPENDENCY RATIO 1.0 1.1 1.2 1.2 1.3

ZUCCO£ DISTRIBUTIONPERCLEH OF PRIVATE INCI2IELUCRiVED BY

UKGESt 5 PERCEhT OF HOUSEHOLDS .. .. ..

LICK1EST 20 PERCENT OF i(OUSEilOLS .. .. ..

LWSRts 20 PERCENT OF HO3SEOLCS .. ..

LOiST 40 PERCEN.Y OF !MOUSEaOLDS .. .. .. ..

POVERTY TARCET CRGRO'S1S3T-U1AJ ABSc3LU7[4 POV£ETY TNCON!LIVEL (US$ PER CAPITA)

D.AN ' ,. .. .. 134.3 507.0IRAL .. .. 0.0/. 82.9 200.6

9SURNATf0 RELATIVE POVERTY tNCOFCIVEL (US5 PER CAPITA)

RIA:4 .. .. 26.0/. 0.4 523.

R- L .. .. 43.07; 0.4 203.6

ESTLYMAED POP'JLATION BeLW APSOLUWTrOVELT% I.CCKE ' LVEL (PERCW)

URI .. L. .. 39.3UUR. .. .. 40.0/a 89.0

Not availableNot applicable.

The Stoop swer g,£ tor *Ach Indicator ar- pcpul&ttoEa-vw 1 htad arltt-tic eansn. Cow.rag t of cnocre,_cn tbe indicators 4.per.o on a*atlauiIty of ica *U4 Is cat %.01ore.

, Unless e'horvise rt. 4taE for 1960 retor to any year betwan 1959 and 1961 for 1970, bet..en 1%9and l:;:. andi for fcst ArCon' Ltleaste, bec.q iBIN aN 1960.

Le 191Ltd 1 M?; 8 / 1175% /t 1%62z !I 1974.

Nfo. 1962

34 -ANNEX TAPage 7 of 7

DETtPLTgdOli OP SOCI,A, iftDtldToO

4-aes Althoogh the data are dra froe sorcs -enraly jodged cit -tst-thorittieeandeeihl,ift bad also be cord tbha they ay ntb ine--nationally coparble heos f ie lack of stndardized defInitions and concepts used by different counrie toclici -h data. fT. d.-t r, oe

thls .asfl to descibe orders of eagnicode, Indicate tr-de. and caaceie -etin eor diffencsbeen onti.

The refeence grops ore 1) the -aeoutry group of ole subject cosocry sea f)a countryl group nieb so-ra highee a-erge oos than its orsn-y groapof hesobecro~tr. ncet oe ig Itrm li fpoter ropahere 'Siddle Inra- Norh Afli-a aod tiddla ias" is chose brest ofereI

oci -ouc.ro1finte I.,i th -cf--or group dot- h "crge Ir pango etighted arcntcsaefor eah iodistar and stov onlyie

andlsnotooifos.uuuclccsca heeorcae inaan- ueaiaoocfdioaronoir tndoer --or oor.sedclnopnnieau

ARth (iho....ed sqis..)Ppitts e oia.ed-ts.ura.aarrl-ouaio fnt.eT-al - Total suface aena o~i I-Iad uraa and inland a r;17 dat.ohe. i rara -diidd by -. nsl re- nln uhe-ffrsi-ltd

ag 1uotura E-fsi-at of agiclualae usd tsaa Iy t persne_ la_iihl i public deidd priut goehe.i d ynin-sdpasirl odrefop caps, asturs. naket nd kitchen gardens or to lie fallos; 1979 data bailtt oncntr. honptl-s te sslsmnspeenol nfe

hratleston pbysfcie. fstb1lesetsprobio prnpabyosodripff0 dOld (155)- mypercap ia an iaieaiourretsorer pboe. ca- dai cre re nt lo laed. ura hositas. hsreer. ucide- helicolredhy ameconrruoo ethd a bod dnt tla (173-d bsis; IhO,erdoedtaiusnerananreeaeetlpstafeaby pbslnao hatby

1970.PE n bedsT data. seia tsoab ure ieie t.f hubffrI-aietyumdy -fid 2-7 _~~~~~~~~~~~~~etaead prnid alitdRaoeofsdia faiite. a sais-

frehspd i dIndd b h nse o=' -f bds. h-ii (b,b

data . i.. . q. : - !-.d9thireno-ge- Slo of osehai IeeoLspa houPmeho df -dtotl,1 urban and-uoira Pplain peno o atl - ttofars - na' total 19p70 ton A boa1e79d conis-disnfa eIpo t dlrdol otoshrdi- a uao

omeg ccarlr; 165 19g. nd1967 dta tir boosr196d 7cr70.elotl19d purposes

Pooaba rjncasuoegnntro rrospota-fclobs.nradhoergcePorciclco o res lotf - Crrentpopultion rojetionst. u..hsd nA"s eeo heroats pe rasIcalhma. n eurl ccpie -cnn nt rurai

Projecion - poraotre fo oclr rtscnen o he eeoaon ncoIrd prtsfogi- lIf ruetcp rbrhicraigo2bcutr1aprcabainme dcot A- eteih-pecet f eef-no --I Ioto urban , sod durs in

tnneh. an fenele lfo rapeoooch otallinitg u 77.) prrs. fIr pra- lornnt lanaI aniliogsatch elecricity 1 lining qOrterd a

ne fpir it-y trends for p H---n po-ose. 'YutdielleiltoSeninryrn-ana -inastnioryppLana tee s obten inePrsoyucan tnl,soeen e1isdan pnl,siran tsi

Ia he ea 150.andtheroe o dnie o frtiit rote enrrlc- eeeay school t-- ta I, soeod fr-Ie Coptrdsaon;rnodrmeat lenei.hn ed..acIoroIrsa ns oryaso prndpiayierri

Tea sat oerycoplaio isrecho -Ti "yar "ie o-- loosiy paoaton poie ess. ctoa,o ens cbiglaro osfrppsloe aill beceacied. nooally o~~~~~f 12 to 17 -te ' of ate io trds- orssaegeeal

only; 1960, 1070 and 1979daro.fillil-t-acherirati - piryacnendy-fu sdnteroIlenlPopolaico Ae Stetitre ipeoenf- Ihld Th 15-14 rhea-s ... ...... g.g 70-pler an. onnd. lrle diidd by-l .t -P-d of tebeminth-- po -sf andreipd-65lete-tdurefas ereeagp frid-eo ,pJ-,r,epedig enls

.ain;lf. 19b .au i- dta Ool preedacn.. rot feen 7 --- trtaots Cob torea and nite

Parlaia do...ot (erent -Ifa-dn-o gasb atn t rin ap- sntdefinlanon fc 15060.190-0-ted-9--d.hsfen- r ard fprt Itndp -h-aiaf Paeage ossdasnis gsaelddie hos r 'nuadf -.. dooual%- lin biri. e taee of nb.d-p-e orose sin les t~.horegnproa t oe aoat rre epaIysia9ian 1960.- less, ad 1900 data.ailifr...e.rle

Crdetet lob (ernhoend - Chasl deatb0e1 py-nasan) o nid 5ea Radiol .ecedoere I.pee thsa dinsaidnd -, Abll ye f aen f ac radioIpopultion;1965.le-s and 190r5 Ida, brod-ass a.e... polc erthusndof-aurin;e--oesan

tl.licy roe;1e960 lept nramsedo i 95 1977. aud 1980. east dongre ablihe--" an.gPavL.iy Gtt Pi tenico-it.eeoars. denual (t.oIsande - .Ano .one ofsnpos T foceners(peidboaa- popiaianf -dIt Iblreenner fcr beodcaste

ralby Plotg-or fpscan at?O sorid ec7amof -penetaooftrredi -gaere adInf rrooe engiscran leo of TV set eas .leffc.

PyIP 0 95.dT5rtbe eidaiy" f ic apeashtPlas -furndmessnee-., ~indt of oodpradtnit ye Capta 1969si-CD) todc o percapta snoai CInma hnua itnedate p Cepta or Ten -londy00nbananhn-o

in. anCalodardesbais poitecee ntvar gode l..sgrarnd soI ( uIts.21f~ f- - h_iinstead ad tugarl eblob art edibir sod c..ontais o...utbiintsl(e.g..fcoffee.aod

naioar Ierg praId-t r rienegis lef-b, 95. aed190 da-ita. Ina orPee-nosns -- tnroitnl cis ros eidnPernait onr o calarir f --cnE- ofreguirenc19f0- 1970ored true. arme focead nelyd a eldigioeers tdet,m

"trY oqllu of net toad As.ppIbe oialei(onrypesptactrn p.p.i.tdan o-all agee.int i Jioo ocol cutie r

expots,andb, uh-gn le stock fe suplIesetaeala Ifed oeeidsfo eprcn In-rsl ao oc spereg fnrllbrfrequni r sd- ia odpocsig and 1 icseey to dih. iutond-.eie- OnclooIecn sbrfrei oee.feStr. huntig JansoI _nr eeotdbyPdhtd npyiloia sd far aril anl-fioirgs prcetag of ota laoP oo;16.190adl aa

hose fl lntl191f-6.d 17 n 1977 da11ne le--gs.. 1970 an. - d y90 at. -nigdi.

pusepr Peo adaibIgeFnai he ro6t 19a 0 prti.d 198 a .te nad reflecting age-set, .t....udn of t~hhe popllahni,adbgtm rd

Peeldfood urney 19616 -, 170 ad -177dto.p,dI.to..be patal-leben f 90oene. ... d,tPer cpitaernion e inyfo o- isal on -pulse P onir ply af toaEd. dPe-)-F- .~. fl.I

rio rm esl an dPulets rs peroa; lhl i 197 Ye 97 at. ItC-t tingirage0 rvy - d yar, no .uideen In this ate grao, for taut d.ne,-Ing noun- 9 pecet. -nbst1 penn, ors 55b pe 96s an pors td.eret

grits dat deIno from lIfe tabes 1960 1970 and60(0 ata.of 0hosehdds

atibth;,pl 1960. . . -p' " 19.fdan 1900 ats.bso shooy be- -nepre d nith oeierhe a1ioqIato -arait Rate Iee -hsnd) usuald b DAtb a-ld ofann order oepea e...e toso.Ifn Poner1y -Innm isnel (0$ eeie~ rite g- urbn nd url -

ofag fenhos6a0 ln birsha; 1960 1900 a-nd 198 data.0 1O0heo d9loteIt paeeytoae enli then .o.m d edIbn an itch.n a --emaduce no I-f iftee (p..e. of proalatlee - tto, rbn, an __ro f Stos nr ininai adqut dieplnsetil0-foneiemtsont

eates .sb.s that fra ynm ttd b -ehde, spetg. sod saM nitary soils) ao gua relat"ive" ponern -ia ie Ife is ae-ebir-d- ad aedg per unil

do sob hare o spend a dipeopartiaso " pare of .the dp y Is -dn g Ie- pear

absd aeiae ha sad `dip ('mi oth ondeteo t d-tsth, of he-as b inmeembIfaand P1~y-. smeattbtss-hen h psiemator thin am of. pin p dos-te

Peeisnos per fieriit-PooaisdnIe pembro raisieg g p -s- 5 .. esomle aset g0ogrl-rise- DiefeiamoEATHs ulfe a if.diac l etta 70 at dai 19sin loeel, . heseolo anlysi sod prssoset Osac4 e

Porala"tttnt Ortof Pses- -PApalanio diOe bY-- osIs of. pOaERiY TgRfEapC19Uptbals ca fesa'la 7 " gtadats rso . Thss.ssfeess. eaeiaegmasotsa

essesta~~~~~~~~ asohilicties.. ._Y.. ..

-35 AMEX 1BPage I. of 6

ECONOMIC INDICATORS

GROSS NATIONAL PRODUCT IN 1981 (P) ANNUAL RATE OF GROWTH (%, constant prices)

US$ Mln. % 1970-75 1975-80 1980 1981 (P)

GNP at Market Prices 1005.6 100.0 0.Q9L!1 3.8-/ 1.81' 6.7Gross Domestic Investment 178.0 17.7 6.6 12.1 -4.2 4.5Gross National Savings 95.9 9.5Current Account Balance -82.1 -8.2Exports of Goods, NFS 82.2 8.2 3.7 -5.7 -33.5 26.8Imports of Goods, NFS 206.6 20.5 8.0 5.7 -13.2 16.2

OUTPUT, LABOR FORCE ANDPRODUCTIVITY IN 1981

Value addedUS$ Mln. %

Agriculture 492.0 51.1Industry 141.4 14.7Services 247.3 25.7Other 2/ 82.2 8.5

TOTAL 962.9 100.0GOVERNMENT FINANCE Central Government -

(BuF Million) Percent of GDP

1980 1980 1976-78Current Receipts 12,715.6 14.3 14.8Current Expenditure 10,848.2 12.2 11.2Current Surplus 1,867.4 2.1 3.6Capital Expenditures 7,736.0 8.7 8.0External Assistance (net) 3,695.0 4.6 3.6

MONEY, CREDIT AND PRICES 1975 1976 1977 1978 1979 1980(Million BuF outstanding at end period)

Money and Quasi Money 3544.4 5220.9 8233.2 9411.2 11452.7 10619.7Bank credit to Public Sector 1271.6 1125.0 270.8 1660.8 4150.4 4177.7Bank credit to Private Sector 997.0 1532.2 1886.9 4491.3 6220.4 6864.4

(Percentage or Index Numbers)

Money and Quasi as % of GDP 10.8 13.2 16.8 17.0 16.1 13.3General Price Index (1970=100) 153.1 163.6 174.6 216.4 272.1 310.2Annual percentage changes in:

General Price Index 15.8 6.8 6.7 23.9 25.7 14.0Bank credit to Public Sector 41.7 -11.5 -75.9 513.3 149.9 0.7Bank credit to Private Sector -60.3 53.7 23.1 138.0 38.5 10.4

NOTE: All conversions to dollars in this table are at the average exchange rate prevailingduring the period covered,

1/ Growth rates calculated on the basis of GDP at factor cost.2/ Net indirect taxes and subsidies.3/ Consolidated statemuent of Government finances.(P) Preliminary

- 36 - ANNEX 1BPage 2 of 6

ECONOMIC INDICATORS

SALANCE OF PAYMENTS MERCHANDISE EXPORTS(Average 1979-81)

1977 1978 1979 1980 1981(Millions US Dollars) US$ Mln %

Export of Goods NFS 96.3 71.4 111.9 78.9 82.2 Coffee 71.1 89.4Imports of Goods, NFS 94.7 123.4 192.9 206.6 206.6 Cotton 1.8 2.3Resource Gap Skins 0.7 0.9

(deficit) = -) 1.6 -52.0 -81.0 -127.7 -124.4 Tea 1.8 2.2

Interest Payments(net) -0.6 -0.9 -1.3 -1.9 -1.6

Workers' Remittances .. ..

Other Factor Payments(net) -13.1 -13.6 -8.9 -6.9 -5.2 All other

Net transfers 29.0 32.7 34.3 52.1 49.1 commodities 4.2 5.2Balance on CurrentAccount 16.9 -33.8 -56.8 -84.4 -82.1 Total 79.6 100.0

Direct Foreign EXTERNAL DEBT,Investment - - - 0.6 0.5 DECEMBER 31, 1981

Net MLT BorrowingDisbursements 18.9 20.2 41.7 42.6 25.5 US$ MlnAmortization 3.5 2.6 2.7 3.6 3.0 Public Debt, incl.Subtotal 15.4 17.6 39.0 39.0 22.5 guaranteed 153.6

Capital Grants 13.8 20.9 25.4 35.1 49.1 Non-Guaranteed PrivateOther Capital (net) -0.3 -24.6 -4.3 8.3 -17.0 Debt ..Other items n.e.i. 0.2 3.2 -6.7 8.9 -19.0 Total outstanding andIncrease in DisbursedReserves (-) -46.1 16.7 3.4 -7.5 -46.0

Gross Reserves DEBT SERVICE RATIO FOR 1981 /3(end year) 1/ 95.9 83.4 98.9 104.6 60.5 /2

Net Reserves (end %year) 86.0 69.3 65.9 73.4 27.4 Public Debt incl.

guaranteed 5.6Non-Guaranteed Private

Fuel and Related Materials DebtImports of which: Total outstanding andPetroleum 5.6 6.7 12.6 25.5 31.7 disbursed

Exports of which:Petroleum - - - - -

RATE OF EXCHANGE IDA LENDING, MARCH 31, 1983

Through Feb. 1973 Since May 3, 1976 IBRD IDAUS$1.00 - BuF 87.5 US$1.00 - BuF 90.0 (Amount expressed in US$BuF 100 - US$1.14 BuF 100 - US$1.11 Million)

Outstanding andFrom March 1973 to May 2, 1976 Disbursed - 71.6US$1.00 - BuF 78.75 Undisbursed - 84.6BuF 100 - US$ 1.27 Outstanding including

Undisbursed - 156.2

1/ Central Bank2/ November 30, 19813/ Ratio of Debt Service to Export of Goods and Non-Factor Services.

.. not available - . non applicable

ANNEX IB- Page 3 of 6

RWANDA

ECONOiiIC INDICLTORS

GNP PER CAPITA IN 1981 (1): US $239

GROSS ZC',ESTIC PRODUCT IN 1981 (2) ANNUAL PRATE OF GROWTH*%, constant 1976 pric:sJ (3)

US $ Mln. X 1977-81GDP at 1arket Prices 1,257.8 100.0 5.8Gross Domestic Investment 282.4 22.5 8.0Gross National Saving 109.8 8.7Current Account Balance -172.6 -13.7Export of Goods, NTS 150.9 12.0 -3.9Import of Goods, NFS 332.0 26.4 5.0

GOVERNTMENT FINANCE

Central Government(RwF Ml.) Zof GDP1981 (2) 1901 (2) 1972

Current Receipts 14,827 12.7 8.3Current Expenditure 14,040 12.0 10.7Current Surpluc 787 0.7 -2.4Capital Expenditures *2,562 2.2 1.2Overall surplus (4) -2,241 -1.9 -3.0

(1) The Per Capita GNP estimate calculated by the same conversion technique as the WorldBank Atlas. All other conversions to dollars in this table are at the averageexchange rate prevailing during the period covered.

(2) Provisional.(3) Trend rates based on least squares estimates.(9' The ovetall surplus is not equal to the difference between current savings and

ievelopment expenditures because the consolidated surplus or deficit of thleCreasury special accounts is not shown in this table.not available,iot applicable.

- 38 -

ANNEX IBPage 4 of 6

COUNTRY DATA - RWANDA

MONEY, CREDIT and PRTCES 1977 1978 1979 1980 1981(Million RwF outstanding end period)

Hroney Supply 1) 10,175 11,204 14,185 15,331 16,331Bank Credit to Government (net) 363 23 -1,350 -2,929 -1,939Bank Credit to Private Sector 4,389 5,134 4,563 6,515 8,171

(Percentage or Index Numbers)Mone'! as % of GDP 14.0 13.8 14.6 14.4 14.2Consumer Price Index (Jan-Mar 1976=100) i16.7 131.3 152.1 163.2 173.8

Annuial percentage changes in:Consumer Price Index 14.5 12.5 15.8 7.3 6.5Bain credit to GovernTment (net) -77.4 -93.7 -5970.0 -117.0 33.8Bank credit to PrJvate Sector 60.1 17.0 -11.1 42.8 25.4

BALANCE OF PA'RENTS ZERCHANDISE EXPORTS (AVERAGE 1978-81)

1978 1979 1980 1981(2) US$Mln. X(US$ Millions)

Exports of Goods, NFS 126 227 166 161 Coffee 79.s 54.8Imports of Goods, NT'FS -261 -309 -323 -332 Tea 10.6 8.0Resource Gap (deficit=-) -136 -82 -157 -181 Cassiterite 17.6 13.1

Wolfram 5.5 4.1Factor Services (net) -5 -2 5 12 Pyrethrum 1.3 0.9h'-et transfcrs - 5 -1 -3 Cinchona J..9 1.5Balance on Cur. Account -141 -79 -155 -172 Other 23.9 17.6

Total l1:0T 100.0Official Grants 95 128 106 106Direct Private For.Invest. 10 13 17 19Net MLT LMans 19 40 33 25 EXTERNAL DEBT, DECEMBER 31, 1981O(iaer M & LT (net) 1 -22 -2 2 US$Mln.Net Short-Term Capital 21 -10 22 20 Public Debt, incl.guaranteed 172.1Capital Flows, NEI -6 1 -2 -9 Non-Guaranteed Private DebtErrors & Omissions 5 -1 -6 1 Total cutstanding & disbursed

Increase in Reserves C-) -4 -70 -13 -1Gross Reserves (end year) 100.0 177.6 208.8 199.2 NET DEBT SERVICE RATIO for 1981 (4)

Petroleum imports (3) 17.0 23.,0 30.0 32.0 %Pettoleum Exports (3) . . . . Public Debt incl. guaranteed 1.8

Non-guaranteed Private DebtTotal outstanding & disbursed

RATE OF EXCAiNGEAnnual End IDA LENDING,(July 31,1982)(US$M1n.)Averages Period IDA.1974-80 Sept. 1982 Outstanding & Disbursed 83.5

US$ 1.00 = RWF 92.84 92.84 Undisbursed 100.2-RwF 1.00 - US$ 0.011 0.011 Oultstanding incl.

Undisbursed 183.7

1) Includes Money and Quasi money2) Provisional.3) Crude and derivatives.4) Debt Service net of interest earned on foreIgn exchange reserves as a

percentage of Exports of Goods and Non-Factor Services.not availablenot applicable

-- less than US $ 0.5 million

ANNEX IBPage 5 of 5

- 39 -

ZAIRE - ECONOMIC INDICATORt

NATIONAL ACCOULNTS

Amount(million USS at Share of GDP at Market Prices (%) Annual Growth Rates (I)

current prices) (at current prices) (at constant 1970 prices)

1981 1981 1979 1980 1981

21Gross Domestic Product-/ 5,384.1 100.0 0.3 2.4 2.4

(GDP Conmercialized) (4,222.5) (78.4) (0.2) (2.4) 2.4

Agriculture 1,722.2 32.0 3.1 2.8 2.7

Industry (incl. mining) 1,269.5 23.6 -6.1 4.4 4.8

Services 2,183.7 40.6 4.6 0.1 0.4

Consumption 4,717.3 87.6 -3.6 7.2 6.8Gross Investment 1,361.2 25.3 56.8 172.4 -49.8Exports of GNFS ~'966,7 18.0 -21.0 23.8 -44.6I=ports of GNFS - 1.661.1 30.9 7.7 222.0 -62.8Gross national savings 347.1 6.4 6.0 -41.3 57.3

PUBLIC FI:CE- Central Government) (million Z) X of GDP

A c t u a 1 (at market prices)1979 1980 1981 1979 1981

Current revenues 1,944.4 3,777.4 4,781.5 17.5 20.3

Current expenditures 2,391.7 3,850.4 5,964.0 21.5 25.3C-nrrent deficit 447.3 73.0 1,182.5 4.0 5.0Capital expenditures 129.3 246.4 539.7 1.2 2.3

Overall deficit 576.6 319.4 1,722.2 5.2 7.3

WSEY, CREDIT AND PRICES 1979 1980 1981

(million outstanding end pqriod)

Money and Quasi Money 2,084.9 3,367.3 4,644.9

Ban'k Credit to Public Sectcr 2,062.2 2,329.4 3,783.6

Lank Credit to Private Sector 878.7 1,014.3 1,342.4

(Percentages or index Numbers)

money and Quasi Money (as I of GD?.- market prices) 18.8 19.6 19.7

Corsumer Price Inde.x (1975 * 100)4/ 912.7 1,313.3 1,813.1Annial percentage changes inConsumer Price Incex 101.3 43.9 38.1

Bhnk Credit to Puhblic Sector 30.7 13.0 62.4Lank Credit to Private Sector 37.1 15.4 32.3

NnTE: All conversions to dollars in this table are at the average

exchasje rate prevailing during the period covered.

1981 figures are preliminary.

2/ At market prices; components are expressed at factor cost and villaot add due to exclusion of net indirect taxes and subsidies.

3t Cash operations only; excludes foreign grants and expenditures

financed by foreign sources.

if Consumer price index for the city of Kinshasa.

December 17, 1982

ANNEX IBPage 6 of 6

- 40 -

ZAIRE - ECONOMIC INDICATORS

BALANCE OF PAYXENTS 1979 1980 1981(Million US$ at current prices)

Exports of goods and services 1,9r4.6 2,088.4 1,589.5of which: Mcrchandise F.O.B. (1,834.0) (1,954.9) (1,494.0)

Imports of goods and services 1,967.3 2,219.9 2,196.7of which: Merchandise F.O.B. (1,106.9) (1,201.3) (1,096.6)

Private transfers (net) -96.6 -74.9 -82.5Current Account Balance -149.3 -206.4 -689.7Official grants (net) 164.1 208.2 188.7Public Capital (net) -49.6 - -23.8 -159.2Private Capital (net) and errors andomissions -220.4 -280.1 -66.0

SDR Allocation 20.4 20.8 18.9Other Financing 282.8 265.5 490.5

Change in net international reserves -48.0 -31.8 216.8(- increases)

EXCHANGE RATES:

January 2, 1979-August 27, 1979 £ 1.00 - SDR 0.5August 27, 1979-February 22, 1980 £ 1.00 - SDR 0.375February 22, 1980-June 19, 1961 Z 1.00 - SDR 0.263Since June 19, 1981 B 1.00 - SDR 0.158

AVERAGE EXCHANGE PATES:

1978 US$ 1.00 - E 0.8361979 US$ 1.00 - 9 1.7291980 USS 1.00 - E 2.8001981 US$ 1.00 - E 4.384

MERCqAINDISE EXPORTS (1981) million US$ z

Minerals and Petroleum 1,270.7 85.1Others 222.9 14.9Total Y,493.6 100.0

EXTERNAL DEBT, Dec. 31, 1981 -/ (million US$)

Public Debt, incl. guaranteed 4,254.0Non-Guaranteed 350.0Total outstanding & Disbursed 4,604.0

DEBT SERVICE RATIO FOR 1981 A A

Public Debt, incl. guaranteed 14.2Non-Guaranteed Private Debt 3.3

ISRDJIDA LENDING Million US$(A of Septembev 30, 1982) IBRD IDA

Outstanding & Disbursed 76.94 200.31Undisbursed 0 237.67Outstanding, incl. Umdisbursed 76.94 437.98

1/ Includes payments arrears, debt rescheduling, emergency assistance, andprofit on gold sales.

2/ Preliminary estimates.

3/ Ratio of debt service to exports of goods and non-factor services.Represents actual payments.

December 17, 1982

- 41 - ANNEX IIAPage 1 of 7

STATUS OF BANK GROUP OPERATIONS IN BURUNDI

A. STATEMENT OF BANK LOANS AND IDA CREDITSEXPRESSED IN US DOLLARS

(As of March 31, 1983)

AmountUS$ million

Loan or (less cancellations)Credit Number Year Borrower Purpose Bank IDA 2/ Undisbursed

One loan 1/ and seven credits fully disbursed 4.8 25.07

626 BU 1976 Burundi FisheriesDevelopment - 6.00 2.10

731 BU 1978 Burundi DevelopmentBank - 3.40 0.32

773 BU 1978 Burundi Second HighwayProject - 14.00 0.04

917 BU 1979 Burundi Second TechnicalAssistance - 2.50 0.20

918 BU 1979 Burundi Forestry - 4.30 1.90

976 BU 1980 Burundi Second Education - 15.00 6.12

1049 BU 1980 Burundi UrbanDevelopment - 15.00 10.76

1058 BU 1980 Burundi Telecommunica-tions - 7.70 6.40

1132 BU 1981 Burundi Third Highway - 22.11 /4 17.225/

1154 BU 1981 Burundi NickelExploration - 3.56 /4 2.86-

1165 BU 1981 Burundi Kirimiro Rural 6 /Development - 17.47 /4 16.71-

1192 BU 3/ 1981 Burundi Integrated RuralDev. Ngozi III - 2.86 /4 15.32-V

1230 BU 1982 Burundi Local Construc-tion Industry - 4.96 /4 4.6351/

Total 4.8 156.39 84.58Of which hasbeer. paid 4.8 .43Total now held 0.0 156.14Total undis-bursed 0.0 84.58

1/ Extended in 1957 to the Belgian Trust Territory of Ruanda-Urundi for theimprovement of the Bujumbura-Muramvya road and the expansion of the Lake portof Bujumbura. The loan which was guaranteed by the Kingdom of Belgium hasbeen fully repaid.

2/ Prior to exchange adjustments.

3/ Not yet effective.

4/ Computed at March 31, 1983 rate of 1.07367

5/ Computed at market rate on dates of disbursement.

- 42 - ANNEX II APage 2 of 7

B. Statement of IFC Investments

(as of March 31, 1983)

Type of Amount in US$ MillionYear Obligor Business Loan Equity Total

1981 Verreries du Glass containerBurundi 4.8 0.8 5.6

Total gross commitments lesscancellations, terminations, repaymentsand sales 4.8 0.8 5.6

Total commitments now held by IFC 4.8 0.8 5.6

Total undisbursed 2.5 0.1 2.6

C. Projects in Execution 1/

(as of March 31, 1983)

Credit No. 626-BU Fisheries Development Project: US$6.0 million ofJune 11, 1976; Effectiveness Date: February 22,1977; Closing Date: June 30, 1982

This project is designed to increase the productionof fish through the provision of training, equipment and materials tofishermen and to improve the distribution of fish throughout Burundi. Theproject also includes financing for the preparation of rural developmentplans for the coastal region along Lake Tanganyika and the implementationof pilot development activities. The project is cofinanced by a US$1.2million loan from the Abu-Dhabi Fund. Project implementation was initiallyvery slow because of problems encountered in the recruitment of bothexpatriate technical assistants and their national counterparts and in theprocurement of goods, and subsequently in project management. About 200 a

metallic and wooden boats have been made available to fishermen, and anexperiment to use low quality local wood to produce longer lasting andcheaper laminated wood boats met with some success. Project managementremained however seriously deficient through Project implementation andSUPOBU's activities related to commercialization and marketing of fish have

1/ These notes are designed to inform the Executive Directorsregarding the progress of projects in execution, and in particularto report any problems which are being encountered, and the actionbeing taken to remedy them. They should be read in this sense, andwith the understanding they do not purport to present a balanceevaluation of strenghs and weaknesses in project execution.

- 43- ANNEX II APage 3 of 7

been unsuccessful, causing severe financial strains on the Company and onthe Government budget. It was therefore decided not to extend the ClosingDate. The Credit accounts will be closed when the last authorizeddisbursements have been made.

Credit No. 731-BU Development Bank Project: US$3.4 millionSeptember 30, 1977; Effectiveness Date: March 27,1978; Closing Date: December 31, 1983

The project aims at providing funds for investment inmedium size productive entreprises and technical assistance to the NationalEconomic Development Bank (BNDE). Implementation of the Project startedslowly. Following, however, an amendment of the Credit Agreement of June1980, which allows the use of up to US$1 million for financing loans tosmall-scale enterprises, project execution has accelerated and the Creditis almost totally committed. The recent creation of a second developmentfinancing institution, the Societe Burundaise de Financement (SBF), raisesserious concerns regarding BNDE's future operations as investmentopportunities do not justify two major term lending institutions in thecountry.

Credit No. 773-BU Second Highway Project: US$14.0 million ofMarch 29, 1978; Effectiveness Date: July 27, 1978;Closing Date: December 31, 1982

The project finances the paving of a major nationroad, Bujumbura-Rugombo (65 km), the start-up phase of an improvementprogram for selected secondary and tertiary roads and bridges, theconstruction of a new central laboratory, the strengthening of themechanized maintenance brigade and the provision of technical assistanceand equipment for the ongoing maintenance program. Project implementation,in particular major road construction, was delayed by the lack of cementand fuel supplies due to disruption in international transport throughneighbouring countries during the first half of 1979. Since then, workshave resumed satisfactorily. Because of these interruptions, and of higherthan expected price increases, the project is encountering high costoverruns. The improvement program for selected secondary roads iscompleted. The construction of a new central laboratory is nearlycompleted. The mechanized maintenance brigate is fully operational and hasreceived all the equipment financed under the project. The technicalassistance component is, in general, meeting its objectives; however,difficulties in recruiting local counterparts and in retaining them inservice once trained have not made possible the reduction of expatriatetechnical assistance as planned. Construction works are nearly completed,and funds are almost totally disbursed. Therefore the Closing Date was notextended and the Credit accounts will be closed when the last disbursementshave been made.

ANNEX II APage 4 of 7

Credit No. 917-BU Second Technical Assistance Project; US$2.5 millionof June 1, 1979; Effectiveness Date: September 27,1979; Closing Date: December 31, 1983

This project provides for the further strengtheningof the Government's planning mechanism and its project preparation andimplementation capacity. It includes continuation of the technicalassistance to macroeconomic planning at the Ministry of Planning, provisionof experts to the planning divisions of the Ministries of Agriculture andIndustry and financing of feasibility studies. The credit is alsofinancing consultant services to support the Government's effort inrestructuring public enterprises. Project implementation is satisfactory.

Credit No. 918-BU Forestry Project: US$4.3 million and US$1.2 millionEEC Special Action Credit of June 1, 1979;Effectiveness Date: October 22, 1979;Closing Date: March 31, 1985

This project assists the Government in initiating thefirst stage for a long-term program to develop basic forestry services andplantations to supply fuel wood, building poles and timber and to establishlong-term wood production and marketing policies. The project includes theestablishment of rural nurseries in 30 communes, a 2,000 ha eucalyptusplantation and a 5,000 ha pine plantation, technical assistance (providedby France) and financing of energy studies. The project is progressingsatisfactorily.

Credit No. 976-BU Second Education Project: US$15.0 million ofApril 23, 1980; Effectiveness Date: July 21, 1980;Closing Date: June 30, 1985

The project assists the Government in training middlelevel technicians and skilled workers in industrial trades andsecretarial-administrative skills. It includes the construction,furnishing and equipping of two new boarding technical schools, a MechanicsDepartment and a Typist and Bookkeeper Training Department in two existingschools and staff housing. Implementation is progressing satisfactorily.The construction of the two new shool departments has been completed aheadof schedule, and the other two major schools will be completed onschedule. The Project Unit is now making a survey of secondary schoolmaintenance and equipment needs. The Planning Unit and the TechnicalEducation Bureau have been strengthened. The Planning Unit is preparing aschool map and the Technical Education Bureau is redesigning the curriculumof technical schools in cooperation with employers to make training morepractical. As the cost of the project is expected to to be lower thanestimated, in part because of early completion of works, the DevelopmentCredit Agreement was amended to finance the construction and equipment oftwenty five of the fifty MLCs which could not be financed under the FirstProject because of cost overruns and the maintenance and improvement offive secondary schools.

-45 - ANNEX II APage 5 of 7

Credit No. 1049-BU Urban Development Project: US$15.0 million ofJune 24, 1980; Effectiveness Date: October 31, 1980;Closing Date: December 31, 1985

This project seeks to redress the most urgentinfrastructure deficiencies in Bujumbura neighborhoods while laying thefoundation on for more efficient future growth. Essential improvements tostreet, drainage, water and public lighting networks will improve livingconditions for 118,000 persons in Bujumbura, or 85% of the population.Serviced plots and loans for house construction will be made available tofamilies between the 20th and 65th income percentiles. An artisanpromotion component is providing technical and financial assistance tocarpenters and metalworkers, the latter in conjunction with an energyassistance program designed to improve the efficiency of charcoal-burningmetal stoves. The capacity of the Bujumbura municipality to collectgarbage and maintain streets, drains, and public buildings is beingstrengthened. The pace of execution slowed in early 1982, but is nowpicking up following agreements reached with new project management onhouse construction at Kwijabe and solid waste collection. Street anddrainage improvements have been completed in the first neighborhood and atthe Kwijabe serviced site. Primary school construction and renovation andthe operation of municipal building and street maintenance units arescheduled to start shortly. An urban tax designed to recover the cost ofoperating, maintaining and replacing municipal services networks wasrejected by the,National Assembly last Fall. The Bank has agreed to extendthe reimburseme,nt of certain operating expenditures, originally provideduntil December 31, 1983, to allow the Government additional time to set upcost recovery mechanisms.

Credit No. 1058-BU Telecommunications Project: US$7.7 million ofAugust 7, 1980; Effectiveness Date: January 7, 1981;Closing Date: June 10, 1985

The project is a major component of the country's1980-84 investment program for telecommunications. It aims at improvingthe quality of existing services while extending the coverage to ruralareas and segments of the population presently unserved. It would alsostrengthen the management of telecommunications parastatal company (ONATEL)in order to establish the company as a financially autonomous entity, andprovide assistance for staff training. ONATEL started functioning inJanuary 1980 and is developing satisfactorily. The project becameeffective on January 7, 1981 and is progressing satisfactorily. Theestimated project cost has increased by about 38% over appraisal estimates(December 1979) due to higher bid unit prices and to the need to increasethe quantity of some project items as demand for services has increasedbeyond expectations. The Government is seeking external financing to meetthis cost overrun.

- 46 - ANNEX II A

Page 6 of 7

Credit No. 1132-BU Third Highway Project: US$25.0 million ofDecember 17, 1981. Effectiveness Date:March 17, 1982. Closing Date: December 31, 1984

The main objectives of the Third Highway Project are:(i) to contribute to reduce the country external transport constraints byassisting the Ministry of Transport in establishing a planning capacity andby financing the construction of a paved road section which would be partof a variant "southern route" linking the capital of Bujumbura to theDar-es-Salaam railway at Isaka in Tanzania; and (ii) to improve thenational road network through construction of the same paved road section,improvement of earth roads, and strengthening of maintenance activities.Improvement works are progressing satisfactorily, and the contractor hasbeen selected for construction works which are scheduled to start inFebruary 1983. Construction works will cost about 24% more than estimatedat appraisal. As additional funds are expected to be provided forequipment from the United Nations Capital Development Fund it is envisagedto finance the increase in construction costs from funds no longer neededfor equipment under the IDA Credit.

Credit No. 1154-BU Nickel Exploration Engineering Project:US$4.0 million of July 15, 1981. Effectiveness Date:August 31, 1982; Closing Date: June 30, 1984

The objective of the proposed project is to developand analyze the basic data needed to reformulate the large scale MusongatiNickel Development Project. The Credit for this project is considered asthe minimum investment required to bring the Musongati Project to a pointwhere both the Government and potential investors can make informeddecisions regarding the Project's viability, including whether or not toproceed with a full feasibility study. The project includes the followingcomponents: (i) nickel exploration; (ii) trial peat production; (iii)engineering studies (high grade mineability, hydro-electric site, sulfursources, and process selection); (iv) overall review of the MusongatiProject viability and (v) management assistance. The project is cofinancedby the Republic of Finland and UNDP. Project start-up was delayed becauseof problems encountered in the selection of the management firm, and thefinalization of cofinancing arrangements. Implementation is nowprogressing satisfactorily.

Credit No. 1165-BU Kirimiro Rural Development Project: US$19.3 millionof December 17, 1981; Effectiveness Date:June 2, 1982; Closing Date: June 30, 1987

The objectives of the project, which is implementedby the Regional Development Company of Kirimiro, are to assist smallholdersin the Kirimiro area to improve the productivity of coffee and foodcropcultivation; improve the quality of exported coffee and improve the rural

ANNEX II A-47 - Page 7 of 7

living conditions. To reach these objectives, the proj_,i includes thefollowing components: strengthening of extension services, afforestationand erosion control measures, construction and equipping of twelvehandpulping centers and six coffee washing stations, improvement of theroad and water supply network, pilot activities and studies. The start-upof the project was delayed by the dismissal by the Government of thetechnical assistance team and of the Project Director. A new ProjectDirector has been appointed and a new technical assistance team has beenrecruited.

Credit No. 1192-BU Integrated Rural Development Ngozi III: US$16.0million of March 29, 1982; Effectiveness Date: (notyet effective); Closing Date: March 31, 1987

The objective of the project, which is implemented bythe Regional Development Company of Buyenzi, is to improve the standard ofliving and productivity of approximately 150 000 farmers in the Ngoziarea. Specifically, the project would include: erosion control andreafforestation; cash crop improvement (coffee); construction of coffeewashing stations; food crop development (crop and seed protection);livestock development; agricultural credit; marketing; provision of healthfacilities; studies. The Project is cofinanced by the International Fundfor Agricultural Development and by the Kuwait Fund. The Credit is not yeteffective but start-up activities are financed from an advance under theproject preparation facility, and from revenues from coffee washingoperations.

Credit No. 1230-BU Pilot project to assist the local constructionindustry: US$5.2 million of June 1, 1982;Effectivenesss Date: November 12, 1982; ClosingDate: June 30, 1986

This pilot project aims at removing some of theobstacles (obsolete construction standards, heavy dependence on importedmaterials, lack of financial and technical support) to the development ofthe local construction industry. The project includes the followingcomponents: (a) at the sector level: (i) development of the lime andbrick production and assessment of the viability of developing other localconstruction materials to reduce the country's high dependence on imports;and (ii) assistance to the Ministry of Public Works Energy and MInes toimprove its capacity to supervise and administer government-financedconstruction projects, and to update and improve the construction code, (b)at the enterprise level: financial assistance to producers of localconstruction materials and contractors through a line of credit madeavailable to the National Development Bank (BNDE), and technical assistanceprovided by the Project Unit in coordination with BNDE. Implementation isprogressing satisfactorily.

ANNEX II BPage 1 of 5

THE STATUS OF BANK GROUP OPERATIONS IN RWANDA

A. Statement of IDA Credits

(As of March 31, 1983)Amount US$ million(Less cancellations)

Credit No. Fiscal Year Borrower Purpose IDA Undisbursed

((Six credits have been fully disbursed) 47.70

567-RW 1975 Rwanda Education 6.38 2.06

655-RW 1977 DFC I 4.00 0.13

769-RW 1978 Road Maintenance 15.00 2.01

896-RW 1979 DFC II 5.20 4.13

937-RW 1979 Mutara Agriculturaland LivestockDevelopment 8.75 4.32

1039-RW 1980 Integrated Forestry and

Livestock Development 21.00 15.06

1057-RW 1981 Telecommunications 7.50 6.87

1126-RW 1981 Coffee/Foodcrops 12.73 1/ 10.64

1217-RW 1982 Technical Assistance 4.64 4.61

1250-RW 1982 Fifth Highway 25.13 25.05

1263-RW 1982 Second Education 9.71 9.71

1283-RW 1982 Phase II Bugesera/

Gisaka/Migongo 15.64 15.64

Total 186.38 IQ&i23Principal Repaid 2.71

Total Held 183.67

V Computed at March 31, 1983 rate of 1.07867.

Note: a) Rwanda has received no Bank loan.

b) US dollars amounts equivalent for IDA VI credits (expressed in SDRs) are

calculated at the rate as of February 28, 1983.

-49 - ANNEX II BPage 2 of 5

B. Statement of IFC Investments(As of March 31, 1983)

In 1976, IFC made a loan of US$535,000 for a tea factory. A secondIFC long-term loan of US$226,000 and contingent equity commitments of up toUS$60,000 for an expansion of the tea factory were signed in September 1980.

C. PROJECTS IN RWANDA 1/(As of March 31, 1983)

Credit No. 567-RW Education Project; US$8.0 Milion Credit of June 30, 1975;Date of Effectiveness: December 1, 1975;Closing Date: December 31, 1983

As now constituted, the project includes construction, equipping andfurnishing of 250 primary-school workshops, a school-textbook printshop, andan office building for the School Financing and Construction Services (SFCS)as well as furnishing and equipping of the Rural Agricultural Training Centerof Gitarama. The project also provides technical assistance, vehicles andoperating expenses for the SFCS. The project has been hampered by implementa-tion difficulties centering on two misprocurements (an amount of US$130,000was cancelled because of misprocurement of certain construction materials; asecond amount of US$1,491,000 was cancelled due to misprocurement of paper).Most of the 250 workshops are nearly completed. The lack of acceptable recordkeeping, however, has impeded the processing of disbursement requests. There-fore, a final inspection and evaluation mission for the workshops, organizedby the Government (with IDA approval) was undertaken successfully in November1981 with UNESCO assistance. Disbursements have resumed. The printshop isnow operational and construction of the office building for the SFCS completed.

Credit No. 656-RW Cinchona Project; US$1.8 million Credit of August 20, 1976Date of Effectiveness: March 2, 1977Closing Date: March 31, 1983

The project provides over a five year period inputs and extensionservices to grow cinchona for export. Progress is satisfactory and there isstill a demand from farmers for planting material. World market pricesfor cinchona derivates, however, remained low during 1979 and 1980, and OCIR(the implementing agency) had to reduce the farm gate price for cinchona bark

1/ These notes are designed to inform the Executive Directors regarding theprogress of projects in execution, and in particular to report any problemswhich are being encountered, and the action being taken to remedy them.They should be read in this sense, and with the understanding they do notpurport to present a balanced evaluation of strengths and weakness inproject execution.

- 50 -ANNEX II BPage 3 of 5

and abolish the export tax and the OCIR levy. In September 1980 it wasdecided to establish a cinchona bark processing plant in the Kirambo area, andconstruction has since started and the factory is scheduled to be open inearly 1983. This should give Rwanda a stronger position in the future tocompete with cinchona derivates on the world market.

Credit 769-RW Fourth Highway Project; US$15.0 Million Creditof April 21, 1978;Date of Effectiveness: August 4, 1978;Closing Date: June 30, 1984

Implementation of the Fourth Highway Project (a US$15.0 millionCredit for road maintenance) started in January 1978. Specialists financedunder the technical assistance program are performing satisfactorily. Procure-ment of equipment is completed. On the suggestion of the Association, anexpert on labor intensive methods visited Rwanda for three weeks in June 1978and recommended that one mechanized unit be replaced by one unit utilizinglabor intensive methods. Following the consultant's recommendation, theGovernment has introduced labor-intensive methods for road maintenance.Although the project is about one year behind schedule, implementation is nowat its anticipated progress rate and the project is proceeding satisfactorily.

Credit 896-RW Second Rwandese Development Bank Project; US$5.2 Million;Credit of July 13, 1979;Date of Effectiveness: January 4, 1980;Closing Date: June 30, 1983

The Project aims at providing further assistance to the industrialsector by supporting the activities of the Rwandese Development Bank. Itincludes two components: (a) a second line of credit of US$5.0 million (whichis now about 90 percent committed) to finance BRD's foreign exchange require-ments and (b) a feasibility study for the establishment of an auditing firmin Rwanda (US$0.2 million). Government has just finished reviewing the auditstudy and its comments are currently under consideration by the Association.

Credit 937-RW Mutara Agricultural and Livestock Development Project;US$8.75 Million Credit of July 13, 1979;Date of Effectiveness: May 30, 1980;Closing Date: December 31, 1983

The project is the second phase of a long-term development programfor the Mutara region. It aims at developing techniques, procedures, and aninstitutional environment which will make it possible to preserve theproduction potential of the area, make a rational and more intensive use ofavailable resources, improve farming and ranching techniques, and integratethe project into the local administration. Settlement of cattle owners hasproceeded in an orderly way and pasture production has improved, but destockingactivities and credit recovery have been disappointing due to lack of clearpolicies and enforcement mechanisms.

- 51 -ANNEX II BPage 4 of 5

Credit 1039-RW Integrated Forestry and Livestock Development Project;US$21.0 Million Credit of July 7, 1980;Date of Effectiveness: November 11, 1981;Closing Date: September 30, 1986

The project is the first phase of a long-term program to developthe forestry resources of Rwanda and to strengthen the livestock industry.Technical assistance personnel and key local staff have been recruited andstart-up activities are progressing satisfactorily.

Credit 1057-RW Telecommunications Project; US$7.5 Million;Credit of August 13, 1980;Date of Effectiveness: July 7, 1981;Closing Date: June 30, 1985

The project aims at improving the quality of existing telecommuni-cations services, while extending the coverage to geographical areas andsegments of the population which at present do not benefit from suchservices. In addition to improving international and domestic telecommuni-cations (telephone and telex) the project provides technical assistance andtraining to the Ministry of Post and Telecommunications. The project iscofinanced with FAC and CCCE (US$3.9 million equivalent) and CIDA (Can$4.95million) and is proceeding satisfactorily.

Credit 1126-RW Lake Kivu Coffee Improvement and Foodcrops Project;US$15.0 Million Credit of April 29, 1981;Date of Effectiveness: January 18, 1982;Closing Date: December 31, 1986

The project aims at building up an effective extension servicewhich would assist farmers in increasing foodcrop and coffee production usingfield-tested techniques and also helping OCIR-Cafe (the implementing agency)improve its financial management. Technical assistance personnel and keylocal staff have been recruited and start-up activities are progressingsatisfactorily.

Credit 1217-RW Technical Assistance Project; US$5.0 MillionCredit of April 5, 1982; Date of Effectiveness:

November 22. 1982: Closinp Date: December 31. 1986.

The project aims at increasing Rwanda's absorptive capacity,improving interministerial coordination in project preparation and monitoring,and strengthening the Ministry of Planning (MINIPLAN). The project creditagreement was signed April 5, 1982. The Project Economist to be assignedto the Programming Directorate in the MINIPLAN has been recruited and has beenat his post since mid-June 1982.

-52 - ANNEX II BPage 5 of 5

Credit 1250-RW Fifth Highway Project; US$25.9 Million Credit ofJune 1, 1982; Date of Effectiveness: December 8, 1982;Closing Date: December 31, 1986

The Project aims at fostering economic integration of the southwesternregion with the rest of the country, to facilitate agricultural developmentin the region, and improve overall transport planning capacity. Its maincomponents are (a) construction and supervision of a paved road; (b) engineeringstudies for restoration works on the Kigali-Gatuna road; (c) procurement ofmaterials and supplies for maintenance of the Kigali-Gatuna Road; and (d)(d) technical assistance to the Ministry of Public Works.

Credit 1263-RW Second Education Project; US$10.0 Million Credit ofJune 30, 1982; Date of Effectiveness: April 13, 1983;Closing Date: September 30, 1987

The Project is to assist the government in meeting increasinglyacute shortages of qualified personnel in commerce, nursing and primaryschool teachers. It includes the construction and equipping of: (a) anexpansion of a Commerce Training College; (b) a new nurses training school;(c) two new Primary Teacher Training Colleges; and (d) two demonstrationschools. The Project Implementation Unit (PIU) is established and thearchitect and accountant of the Project Unit have been employed.

Credit 1283-RW Phase II Bugesera Gisaka Migongo Project;US$16.3 Million Credit of September 28, 1982; Dateof Effectiveness: March 29, 1983; Closing Date:December 31, 1988

The Project is the second phase of a long term development programfor the Bugesera and Gisaka Migongo regions and aims at consolidatingaction begun under the first project to develop essential infrastructureand improve rural services in the communes. Project start-up activitiesincluding the family planning component, are proceeding satisfactorily.

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Page 1 of 9

STATUS OF BANK GROUP OPERATIONS IN ZAIRE

A. STATEMENT OF BANK LOANS AND IDA CREDITS (As of March 31, 1983)

Loan orCredit Fiscal Amount in US$ millionNumber Year Borrower Bank IDA 1/ Undisbursed

Priorto June Congo & Transport 91.58 2/1960 Otraco Infrastructure

One Loan Fully Disbursed 100.00Ten Credits Fully Disbursed 119.50 0.14

571 1975 ZAIRE Rail-River II 26.00 1.21624 1976 ZAIRE Education II 21.00 18.95660 1977 ZAIRE Cotton Reha-

bilitation 8.00 3.24697 1978 ZAIRE Ituri Livestock

Development 8.00 0.42710 1978 ZAIRE Fourth DFC 10.00 0.20796 1978 ZAIRE Oil Palm 9.00 9.84902 1979 ZAIRE Railways 20.00 10.09916 1979 ZAIRE Highway IV 26.00 6.01998 1980 ZAIRE Fifth Dev. Finance 18.50 8.311040 1981 ZAIRE Smallholder Maize 11.00 9.431089 1981 ZAIRE Kwilu Ngongo Sugar 21.79 5/ 9.94 6/1152 1981 ZAIRE Kwango-Kwilu

Technical Assistance 2.59 5/ 2.28 6/1180 1982 ZAIRE ONATRA Modernization 24.38 5/ 23.60 6/1224 1982 ZAIRE Shaba Power System

Rehabilitation 17.69 5/ 17.59 6/1241 1982 ZAIRE Water Supply II 17.26 5/ 16.82 6/1244 1982 ZAIRE Agriculture T.A. 4.85 5/ 11.66 6/1264 1982 ZAIRE Second Cotton 10.57 5/ 10.57 6/1273 1982 ZAIRE Sixth DFC 20.92 5/ 20.92 6/1290 1983 ZAIRE Highways V 41.64 5/ 41.64 6/1325 4/ 1983 ZAIRE North East Rural Dev. 13.27 5/ 13.27 6/1335 4/ 1983 ZAIRE Ports Rehabilitation 24.92 5/ 24.92 6/1336 1983 ZAIRE Gecamines TA 7.01 5/ 7.01 6/

Total (less cancellations): 191.58 483.89 258.96- of which has been repaid 118.48 0.98

Total now outstanding: 73.10 482.91 258.96

1/ Prior to exchange adjustments.2/ Guaranteed by the Kingdom of Belgium.3/ Credit 255-CK, originally US$7.0 million, has closed with undisbursed balance

of US$80,000 which will be cancelled; Credit 398-ZR has several withdrawalapplications pending which, when paid, will leave a balance of aboutUS$60,000 to be cancelled.

4/ This credit was signed but is not yet effective.5/ Computed at the March 31, 1983 rate of 1.07867.6/ Computed at market rate on dates of disbursement.

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ANNEX IICPage 2 of 9

Amount sold: 54.47- of which has been repaid 54.47

Total now held by Bank and IDA 1/ 76.94 437.98

Total Undisbursed: 0.0 237.67

B. STATEMENT OF IFC INVESTMENT 1/ (As of March 31, 1983)

Fiscal Type of Amount in US$ MillionsYear Obligor Business Loan Equity Total

1970 Societe Financiere deDgveloppement (SOFIDE) DFC - 0.76 0.76

1979 Zaire Gulf Oil Company Oil Company 2.50 - 2.50

1979 Zaire Petroleum Company Oil Company 1.61 - 1.61

1983 Nord-Sud Industrie-ROHSTOFF GMBH, for studieson an aluminium project 0.23 - 0.23

Total gross commitments 4.34 0.76 5.10

Less cancellations, terminations,repayments and sales 2.88 - 2.88

Held by IFC 1.46 0.76 2.22

C. PROJECTS IN EXECUTION 1/ (As of March 31, 1983

Credit 571-ZR Railway and River Transport Project; US$26 MillionCredit of July 11, 1975; Effective Date: November 18,1975; Closing Date: December 30, 1983

The project included: (a) technical assistance to ONATRA including acomprehensive training program; (b) financing of a major part of ONATRA's1975-77 investment requirements for river transport equipment, railwayimprovements and track renewal; (c) additional river markings on theKinshasa-Ilebo waterway; (d) port studies; and (e) a preliminary engineeringstudy for the Ilebo-Kinshasa rail link. Project implementation was initiallyslow due to a combination of management shortcomings and financial constraints

1/ These notes are designed to inform the Executive Directors regarding theprogress of projects in execution, and in particular to report any problemswhich are being encountered, and the action being taken to remedy them. Theyshould be read in this sense, and with the understanding they do not purportto present a balance evaluation of strenthgs and weknesses in projectexecution.

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ANNEX IICPage 3 of 9

which improved during execution. All procurement is now completed or underway;and credit funds are fully committed. ONATRA's financial performance has im-proved significantly as a result of tight controls. Operations have improved inthe ports, in river transport, in the shipyards and in the railway. While over-all project execution is proceeding satisfactorily, extension of the ClosingDate is being considered to allow for some additional procurement of spareparts.

Credit 660-ZR Cotton Rehabilitation Project - US$8 million Credit ofDecember 28, 1976; Effective Date: May 31, 1977;Closing Date: December 31, 1983. Cofinanced by Belgium

Project implementation has been slow from the beginning due tovarious administrative obstacles and the dissolution of ONAFITEX, the NationalCotton and Project Implementing Agency, in May 1978. Coton-Zaire, a publicenterprise, was created in December 1979 to replace the former ONAFITEX regionalOffice. An Amendment Agreement reflecting these changes was signed on October10, 1980; Government counterpart funds for investments were transferred toCoton-Zaire and the technical assistance team was integrated in the company withclear responsibilities. The cotton campaigns since 1979 have been carried outon a regular schedule and production, although still very low, is increasing.Producer prices have been increased since 1981 in nominal terms. Efforts nowfocus on converting Coton-Zaire from a public to a mixed-capital company, likethose that handle cotton promotion elsewhere in Zaire and which are to besupported by IDA's Second Cotton Project (Cr. 1264-ZR). Continuity of effortand support for area cotton farmers are at stake in view of the credit's end-1982 closing date. Government is now negotiating with possible private sectorpartners.

Credit 697-ZR Ituri Livestock Development; US$8 Million Credit ofAugust 2, 1977: Effective Date: December 30, 1977;Closing Date: June 30, 1983; Cofinanced by theFrench Ministry of Cooperation, the Federal Republicof Germany and Canadian International Development Agency

The project aims at improving livestock production in the Iturisubregion through the provision of improved animal health and productionservices, the training of staff and pastoralists, development of three ranchesto finish range cattle and rehabilitation of marketing and slaughter facilitiesincluding two abattoirs. Despite slow project start-up and continuingconstraints related to high rates of inflation, low prices for beef, latereceipt of government counterpart funds impressive results have been achieved.

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ANNEX IICPage 4 of 9

They include: (i) the establishment and operation of a veterinary and livestockextension service; (ii) the implementation of a training program for extensionofficers and livestock producers; (iii) the establishment of a livestockproducer cooperative which arranges the supply of veterinary products; (iv)vaccination and drenching of about 200,000 cattle annually (two thirds of theproject's objective); (v) initiation of pasture development; and (vi)establishment of regular livestock markets. Future emphasis in the subsectorshould be placed on expansion of marketing.

Credit 710-ZR Fourth DFC; US$10 Million Credit of August 2, 1977;Effective Date: December 3, 1977; Closing Date:December 31, 1982

SOFIDE was established in January 1970 and the Bank Group provided asubstantial share of its initial resources through an IFC equity investment ofUS$750,000 and a First IDA Credit of US$5 million. Three other credits of US$10million each were granted in 1971, 1973 and 1977. SOFIDE started operating onJuly 1st, 1970, with a General Manager seconded by the Bank. In May 1973, aZairian General Manager, assisted by an expatriate Senior Advisor, replaced theBank-seconded General Manager. The institution has developed into a well runand capable development bank, despite the policies of zairianizationretrocession which have disrupted the industrial and financial sectors. SOFIDEhas recently diversified its activities by increasing its operations in keyeconomic sectors, especially agriculture and transportation. SOFIDE has alsodecentralized its operation and has recently opened three regional offices. In1976, the Bank's Operation Evaluation Department conducted a project performanceaudit of the First Credit to SOFIDE and found that SOFIDE had been generallysuccessful in fulfilling its objectives and had developed into a competentorganization. The original closing date (December 31, 1981) was extended by oneyear to permit disbursement of the remaining credit funds which were fullycommitted to subprojects. The credit closed at end 1982 as scheduled.

Credit 796-ZR Oil Palm Project - US$9 Million Credit of June 8, 1978:Effective Date: January 30, 1981; Closing Date: December31, 1985; Cofinanced by African Development Fund (ADF)Banque Arabe pour le Developpement Economique en Afrique(BADEA) and Caisse Centrale de Cooperation Economique(CCCE)

The project consists of a five-year program to support therehabilitation of existing oil palm plantations through investments forreplanting and new plantings, renewal of oil mills and transport equipment,improvement and expansion of social infrastructure; the employment of additionalstaff, and training of staff. Effectiveness was delayed by the difficultieswhich arose between the companies and the Government over the role of the

ANNEX IICPage 5 of 9

companies in the Project; by administrative bottlenecks, particularly in theMinistry of Agriculture; and by the complex cofinancing arrangements. One of thethree companies which was to participate in the project has withdrawn and theinvestment and financing plans were revised. Of the remaining companies, onehas begun a planting program out of its own resources but has delayed a majordecision on rehabilitation of its oil mills until 1982. The second company hasplaced equipment orders for vehicles and oil mill parts to start its plantingand oil mill rehabilitation program. Cancellation of BADEA's $4.4 million crediton August 10, 1982 will force a revision of cost estimates and the financingplan. It may be possible to accomodate these without major disruptions as aresult of savings in oil-mill rehabilitation.

Credit 902-ZR Railway Project: US$20.0 million Credit of June 14, 1979;Effective Date: January 27, 1981; Closing Date:June 30, 1983; Cofinanced by the Saudi Fund forDevelopment; Kreditanstalt fur Wiederaufbau; theOPEC Special Fund; and the African Development Bank

The Project supports the 1979-1982 investment program of the SocieteNationale des Chemins de fer Zairois (SNCZ) and includes track rehabilitation,equipment and operational investments to increase SNCZ's effective capacity.The project finances: (a) renewing and upgrading 210 km of track and ballastinganother 285 km; (b) 100 ore wagons, 9 shunting locomotives and 12 passengercoaches; (c) spare parts for locomotives and wagons; (e) extension of Ilebo portfacilities; (f) social infrastructure; and (g) middle/senior technical andmanagement staff training and consultant services. Effectiveness of this creditwas delayed in particular by slow progress in completing cofinancingarrangements. Disbursements have also been slow owing to the weakness ofpurchase and storage controls which prevented placing purchase orders in atimely manner. The Project scope is being revised following the decision of theSaudi/OPEC Funds to suspend disbursements. Postponement of the closing datewill be necessary because of delays in the effectiveness of the Credit.

Credit 916-ZR Fourth Highway Project: US$26 million Credit of June14,1979; Effective Date: July 16, 1980; OriginalClosingDate: December 31, 1982, postponed to December 31,1983;Cofinanced by the EEC Special Action Fund and theSaudiFund for Development.

The project was designed to help finance the 1979-81 roadmaintenance and rehabilitation program of the Office des Routes (OR). Itcomprises the maintenance and rehabilitation of about 40,000 km of roads,including 800 km of paved road; strengthening and replacement of bridges;construction of workshops and warehouses; procurement of motor and cable ferries

- 58 -

ANNEX II CPage 6 of 9

and replacement motors, and of highway maintenance equipment, spare parts andfuel; improvement of the National Public Works Laboratory, and technicalassistance and training. Implementation of the project had to be postponedowing to a one year delay in credit effectiveness. Procurement of equipment andspare parts is now substantially completed, and the maintenance/rehabilitationprogram which has been extended to include 1982, has become fully operational.However fuel shortages in 1982 endangered seriously the execution of the programand maintenance objectives for 1982 were not achieved. Solutions are largely inplace to overcome the problems created by the Saudi Fund's decision to suspenddisbursements on its remaining balance.

Credit 998-ZR: Fifth DFC; US$18.5 Million Credit of June 16, 1980;Effective Date: January 22, 1981; Closing Date: June 30,1984

As of September 30,1982 US$15.5 million of this Credit had beencommitted under the investment component and US$1.6 million for the workingcapital component . Disbursement of credit funds is expected to acceleraterapidly in the latter half of 1982 following the normal IDA and SOFIDE approvalof sub-projects and the placement of orders. Comments on SOFIDE are reflectedunder Credit 710-ZR.

Credit 1040-ZR Smallholder Maize Project: US$11 million Credit ofOctober 9, 1980; Effective Date: May 11, 1981; ClosingDate: December 31, 1987; Cofinanced by the InternationalFund for Agricultural Development (IFAD) and AfricanDevelopment Bank (ADB)

The project aims to improve existing farming systems in an areacovering about 26,000 km2 around Mbuji Mayi, increase maize production fromabout 80,000 tons to about 120,000 tons per annum and increase the incomes ofabout 53,000 farmers. The Project includes (a) provision of inputs includingfertilizer and improved maize seeds, transport, distribution and sales servicesand storage facilities for inputs; (b) development of the private marketing sec-tor; (c) development of improved extension, training and research facilities;(d) development of road and drinking water infrastructure; and (e) technicalassistance in support of the above activities. Project implementation is pro-ceeding well after initial financial and personnel recruitment problems. Maizeoutput increased by about 30,000 tons in the first agricultural year - far inexcess of projections; fertilizer and seed demand are very strong and credit re-payments are good. The principal problem is weak Government budgetary support,notably failure to provide PMKO, the implementing agency, with fertilizer asagreed. PMKO also has personnel and procurement problems.

- 59 -

ANNEX IICPage 7 of 9

Credit 1089-ZR Kwilu-Ngongo Sugar Project: US$26.4 million Credit ofJanuary 7, 1981; Effective Date; May 28, 1981; ClosingDate: December 31, 1986; Cofinanced by the FrenchCaisse Centrale de Cooperation Economique (CCCE)

The Project aims at increasing sugar production through therehabilitation and expansion of factory, field and transportation capacity andalso at promoting foodcrop production. Project implementation is progressingsatisfactorily; procurement and disbursement are well advanced. It is expectedthat factory rehabilitation and expansion will be completed one year ahead ofschedule and field rehabilitation according to schedule; construction of housingand offices is nearly completed. Foreign exchange allocations have been belowagreed levels and the Project entity has had to purchase foreign exchange on theparallel market. Supervision missions have discussed the matter with Governmentbut have met with no success. However, Project implementation will not bedelayed by this problem.

Credit 1152-ZR Kwango-Kwilu Technical Assistance Project: US$2.9 millionCredit of July 23, 1981; Effective Date: July 7, 1982;Closing Date: December 31, 1983

The Credit was declared effective on July 7, 1982. CODAIK, themixed capital development company has been established, technical assistance hasbeen recruited and the Government is reviewing the 1983 work program.

Credit 1180-ZR ONATRA Modernization Project: US$26.0 million Credit ofMarch 10, 1982; Effective Date: October 5, 1982;Closing Date: March 31, 1986 (cofinanced by AfDB and KfW(Federal Republic of Germany).

The Project aims at replacement of a substantial part of ONATRA'sriver transport fleet and rehabilitation of 65 km of railway line. The projectis proceeding well. The Caisse Centrale de Cooperation Economique (France) hasapproved funds for the purchase of goods that were initially proposed forfinancing by BADEA, which withdrew from the project for non-effectivenss of itsloan.

Credit 1224-ZR: Shaba Power System Rehabilitation Project:US$19 Million ofJune 9, 1982; Effective Date: November 11, 1982;Closing Date: June 30, 1987. (Cofinanced by CaisseCentrale de Cooperation Economique, CCCE, of France

The project will rehabilitate the electrical generating stations andthe transmission and distribution system of the Shaba region to minimize therisk of failure of the supply of energy to the mining industry and particularlyto Gecamines. SNEL management, planning, operating and maintenance capabilitieswill be strengthened with the services of experts and provision of equipment,vehicles and spare parts. A delay in Credit Effectiveness was experienced whenthe original cofinancier withdrew from the project.

- 60 -

ANNEX IICPage 8 of 9

Credit 1241-ZR: Second Water Supply Project: US$18 Million Credit ofMay 5, 1982; Effective Date: November 15, 1982;Closing Date: December 31, 1986.

The project as designed at appraisal would strengthen and expandproduction and distribution systems to improve water supply service in thetowns of Kisangani, Mbuji-Mayi and Likasi. The operating and maintenancecapability of REGIDESO would also be strengthened through provision ofmaterials, equipment, vehicles, training and experts' services. Co-financingof US$9.3 million for works in Likasi city was to have been provided by theOPEC Fund for International Development, but has not been forthcoming asanticipated; the Government has requested supplemental financing by theAssociation, and this request is being reviewed. Tenders have been launchedfor the IDA financed cities of Kisangani and Mbuyi-Mayi. Contracts forsupplies have been awarded and the civil work contract should be awarded byend May 1983.

Credit 1244-ZR: Agriculture Technical Assistance Project: US$5 MillionCredit of May 20,1982; Effective Date: November 30,1982;. Closing Date: December 31,1985.

The project will provide experts' services to the Ministry ofAgriculture and Rural Development to strengthen project preparation,planning, financial and budgetary management; and to advise on projectimplementation, monitoring and evaluation, and to the Government to assist inreview of key policy issues.

Credit 1264-ZR: Second Cotton Rehabilitation Project: US$11.3 MillionCredit of August 6, 1982; Effective Date: March 31,1983. Closing date: June 30, 1986.

The project will form an essential element of a long-term cottonrehabilitation program initiated by the Government in 1978. The mainobjective to increase cotton production in the areas of three major cottoncompanies, La COTONNIERE, SOTEXCO and ESTAGRICO. The project will also aimat stimulating production of foodcrops grown in rotation with cotton and atimproving living conditions by expanding communications and health services.

Credit 1273-ZR: Sixth DFC Project: US$ 21.5 Million Credit of August6,1982; Effective Date: March 15, 1983; Closing Date:December 3, 1986.

The IDA Credit would (a) finance the foreign exchange component(US$19.5 million) of the capital investment requirements of subprojectsapproved by SOFIDE in the agriculture, transportation and industrial sectors;(b) provide foreign exchange resources to SOFIDE to enable it to upgrade itsmanagement and control systems and staff capabilities (US$0.9 million); and(c) finance the foreign exchange component of studies to improve industrialsector policy formulation and project selection (US$1.1 million).

- 61 -

ANNEX IICPage 9 of 9

Credit 1290-ZR: Fifth Highway Project: US$43.5 Million Creditof October 29, 1982; Terminal Date forEffectiveness: June 30, 1983; Closing Date:December 31, 1986; cofinanced by AfDB.

The project is designed to support the 1983-85 work program ofOffice des Routesby continuing the country-wide road maintenance andrehabilitation program begun under the Fourth Highway Project Cr. 916-ZR)and includes resurfacing and strengthening of 165 km of paved roads;reconstruction of bridges, replacement of ferries, construction of ferryapproaches, procurement of laboratories equipment and studies. The credit isnot yet effective.

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ANNEX IIIPage 1 of 3

SUPPLEMENTARY PROJECT DATA SHEET

Section I: Timetable of Key Events

(a) Identification: 1979

(b) Project Preparation Reponsibility: EGL/Consultants

(c) Appraisal Mission: July 1982

(d) Negotiations: March 31 to April 5, 1983

(e) Target Effectiveness: December 1983

Section II: Special Conditions

A. The Borrowers (Burundi, Rwanda, Zaire) would:

(i) cause their national electricity companies to assign to SINELACindividuals with qualifications and experience acceptable to theAssociation to be trained as counterparts (para. 60);

(ii) cause each of their national electricity companies to makeavailable for the purposes of SINELAC one-third of all localexpenditures for construction of the project, including workingcapital and financial charges during construction of the project(para. 73);

(iii) cause their central banks to maintain at all times the freeconvertibility between the Burundi franc, Rwandese franc andzaire for SINELAC's quarterly account balances and provide toSINELAC as and when needed foreign exchange for maintenance,renewal and audits (para. 62);

(iv) A condition of Credit signature would be that the Treaty andBy-laws establishing SINELAC be ratified (para. 58); and

(v) Conditions of Credit Effectiveness would be:

(a) the transfer of land and rights required for carrying out theProject to SINELAC (para. 58).

(b) that an individual with qualifications and experiencesatisfactory to the Association has taken up the position ofGeneral Manager of SINELAC on a full-time basis (para. 59);

(c) completion of contractual arrangements concerning the purchaseof power from SINELAC by the three national electricitycompanies (para. 63);

63 -

ANNEX IIIPage 2 of 3

(d) payment by each Government of US$100,000 equivalent towardsSINELAC working capital requirements (para. 73);

(e) fulfillment of all conditions precedent to initial disbursementof co-financiers' loans and conditions of effectiveness of theother Borrowers' Credit Agreements (para. 67); and

(f) signature of subsidiary loan agreements between SINELAC and thethree Governments (para. 67).

B. The Government of Burundi as Borrower would:

(i) cause REGIDESO to carry out a study of its tariff structure andfurnish to the Association the results of the study by December 31,1983 (para. 71);

(ii) cause REGIDESO to revalue annually its fixed assets in service(para. 73);

(iii) agree to carry out works on its transmission and distributionnetwork required for the use of power generated by Ruzizi II(para. 72);

C. The Government of Rwanda as Borrower would:

(i) cause ELECTROGAZ to carry out a study of its tariff structure andfurnish to the Association the results of the study by December 31,1983 (para. 73); and

(ii) cause ELECTROGAZ to revalue annually its fixed assets in service(para. 73);

(iii) agree to carry out works on its distribution system required forthe use of power generated by Ruzizi II (para. 72).

D. The Government of Zaire as Borrower, would:

(i) cause SNEZ to carry out annually a revaluation of the economicvalue of its fixed assets (para. 73);

(ii) agree to carry out works on its transmission and distributionnetwork required for the use of power generated by Ruzizi II(para. 72).

E. SINELAC would:

(i) employ at all times on a full-time basis a Technical Director and aFinancial and Administrative Director (para. 60);

- 64 -

ANNEX IIIPage 3 of 3

(ii) employ a civil engineer by December 31, 1983 and a chief accountantby June 30, 1984 as members of the management team of technicalexperts (para. 60);

(iii) employ a panel of experts to review the adequacy of project design,and safety of the dam and related structures and conduct periodicreviews of the design during and after construction (para. 60);

(iv) review and discuss with the Association any proposed investmentproject and not undertake any proposed investment in excess ofUS$500,000 equivalent without the Association's prior approval(para. 61); and

(v) employ a consultant eight months prior to the commissioning of thefacilities to recalculate the average wholesale electricity tariffand furnish to the Association the report of the consultant nolater than three months prior to the date estimated for thecommissioning of the facility (para. 64).

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