World Bank Document · 2016-07-11 · Document of The World Bank FOR OFFICIAL USE ONLY Report No....

Document of

The World Bank

FOR OFFICIAL USE ONLY

Report No. 15308

IMPLEMENTATION COMPLETION REPORT

CHINA

SHANDONG AGRICULTURAL DEVELOPMENT PROJECT(CREDIT 2017-CHA)

JANUARY 26, 1996

Rural and Social Development Operations DivisionChina and Mongolia DepartmentEast Asia and Pacific Regional Office

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

Currency Unit = Yuan (Y)Y 1.00 = $0.1 15

1988 (appraisal) $1 = Y 3.711990 $1 = Y 4.721991 $1 = Y 5.221992 $1=Y5.381993 $1 = Y 5.451994 (onwards) $1 = Y 8.70

FISCAL YEAR

January I - December 3 1

WEIGHTS AND MEASURES

Metric System

ABBREVIATIONS AND ACRONYMS

ABC - Agricultural Bank of ChinaCAAS - Chinese Academy of Agricultural SciencesCAS - Chinese Academy of SciencesHECH - Haihe Engineering Command HeadquartersICB - International Competitive BiddingIDA - International Development CorporationITC, CNTIC - International Tendering Company, China National Technical Import

CorporationMOA - Ministry of AgricultureMOF - Ministry of FinancePLG - Project Leading GroupPMO - Project Management OfficePO - Project OfficePREDIC - Provincial Rural Economic Development and Investment Corporation

FOR OFFICIAL USE ONLY

CONTENTS

PREFACE ...................................................... iii

EVALUATION SUMMARY ..................................................... iv

PART I. IMPLEMENTATION ASSESSMENT ...................................................... 1A. Project Objectives ....................................................... 1B. Implementation Experience And Results ..................................................... 2C. Project Impact ...................................................... 4D. Major Factors Affecting The Project .................................................... 4E. Project Sustainabilitv ...................................................... 6F. IDA Performance ....................................................... 6G. Borrower Performance ....................................................... 7H. Assessment Of Outcome ....................................................... 8I. Future Operation ...................................................... 8J. Key Lessons Learned ...................................................... 8

PART II. STATISTICAL TABLES ...................................................... 10Table 1: Summary of Assessment ...................................................... 10Table 2: Related Bank Loans/Credits ...................................................... 11Table 3: Project Timetable ....................................................... 12Table 4: Credit Disbursements: Cumulative Estimated and Actual ..................... 12Table 5: Key Indicators of Project Implementation .............................................. 13Table 6: Key Indicators for Project Operations .................................................... 19Table 7: Studies Included in Project ...................................................... 20Table 8A: Project Costs ...................................................... 20Table 8B: Project Financing ...................................................... 21Table 9: Economic Costs And Benefits ...................................................... 21Table 10: Status of Legal Covenants ...................................................... 22Table 11: Compliance with Operational Manual Statements ............................... 24Table 12: Bank Resources: Staff Inputs ...................................................... 24Table 13: Bank Resources: Missions ...................................................... 25Table 14: Role of Women in Project ...................................................... 26

ANNEX A: MISSION AIDE-MEMOIRE ..................................................... 27

ANNEX B: BORROWER'S CONTRIBUTION TO THE ICR ................................. 29

is docu ent has a resuicted distribution and may be used by recipients only in the performance of theirofficial duties. Its contents may not otherwise be disclosed wiLhout World Bank authorization.

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CHINA


PREFACE

This is the Implementation Completion Report (ICR) for the ShandongAgricultural Development Project in China, for which an IDA Credit (Credit 2017-CHA)in the amount of SDR 82.5 million was approved on May 16, 1989 and made effective onJanuary 29, 1990.

The credit was closed on December 31, 1994. It was fully disbursed, and the lastdisbursement took place on December 12, 1994.

The ICR was prepared by Qun Li (Consultant) and W.P. Ting (Agriculturalist).The ICR was reviewed by J. Goldberg, Chief, EA2RS and Y. Kimura, Project Advisor,EA2DR. The borrower provided comments that are included as an annex to the ICR.

Preparation of this ICR was begun during the Bank's final supervision mission inSeptember 1994. It is based on the material in the project file and meetings with projectstaff in the field. The borrower contributed to the preparation of the ICR by contributingviews and data requested, its own evaluation of the project's execution, and comments onthe draft ICR.

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CHINA


EVALUATION SUMMARY

Project Objectives

1. The main objective of the project was to assist the Shandong ProvincialGovernment to: accelerate the development of agriculturally unproductive coastallowlands for culture fisheries; intensify crop production in existing low yielding areas;increase the value of livestock production and processing in the Tuhai River Basin; andhelp alleviate poverty and provide productive employment for women through upgradingof production and processing of small livestock in the poverty-stricken Yi Mengmountain area. The main features of the project were as follows: (a) a coastaldevelopment component, including the cultivation of shrimp and specialty seafood;construction of hatcheries, feedmills, cold-storage, processing facilities and servicecenters; and strengthening research and development; (b) the Tuhai River Basincomponent including improvement and expansion of five irrigation areas; provision ofagricultural input and support services; development of Chinese dates intercropped withfood grain and fast-growing trees, processing of dates, feed and meat; improvement ofgrassland areas; and rearing and breeding of beef, cattle, sheep and broilers; (c) the YiMeng livestock component, including rearing and breeding of rabbits, pigs, chickens, andgeese; processing of livestock feed, meat, goosedown, rabbit-wool; and veterinaryservices; and (d) a project management component including the provision of technicalassistance and training; and applied research.

2. The objectives were generally well designed, spelled out in the projectdocumentation, and supported by project staff and beneficiaries. Similarly, theyappropriately reflected the Government's implementation capacity and were consistentwith both the Government's development strategy and the Bank's Country AssistanceStrategy at the time of preparation.

Implementation Results and Experience

3. The project substantially achieved the objectives of agricultural growth in thecoastal areas of Shandong. As a result of the strong performance of most subcomponentsof the mariculture component, the agriculture, livestock, and most agroprocessingcomponents, the overall economic return of the project is reestimated at 31 percent,slightly above the appraisal estimate of 29 percent.

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4. IDA's performance in identification, preparation, and appraisal of the project isviewed as satisfactory to highly satisfactory. IDA's performance in supervision is alsoconsidered satisfactory, although the project would have benefited from more frequentsupervision visits. The borrower's performance in project preparation andimplementation was generally satisfactory, though some aspects were deficient: severalproject units would have benefited from more regular visits by the provincial ProjectManagement Office (PMO) and county Project Office (PO) staff. Some project unitsfaced serious problems with counterpart fund availability, which affected timelycompletion of civil works and commissioning of agroprocessing plants.

Summary of Findings, Future Operations, and Key Lessons Learned

5. Overall Finding. The project's outcome is viewed as satisfactory, since the mostimportant objective of agricultural growth and development in Shandong's coastal areaswas achieved with a relatively high degree of sustainability. The overall economic rate ofreturn of 31 percent is particularly impressive in view of the difficulties facing the shrimpand cotton subsectors not only in the project area but throughout China duringimplementation. Overall, the project had a fairly strong developmental impact throughthe provision of scarce investment funds for the expansion of agricultural production andvalue-added processing in a relatively poor part of Shandong province. The project is notviewed as highly satisfactory because of the limited achievements of the shrimpproduction component, the delay in some of the agroprocessing plants' commissioningand some shortfalls in the training component.

6. Project Impact. Apart from a strong impact on poverty alleviation in the projectarea, the project generated productive job opportunities, mainly geared to women in thepoor Yi Meng mountain area. Particularly, the raising of small livestock, which istraditionally done by women, had a significant impact on poor households. In addition,the project provided access to new productive work opportunities for women not only athome but also as workers in the breeding farms. Incremental employment was created innew processing activities such as meat-packing, goose feather and down processing,rabbit wool spinning, knitting, date processing, and packaging of mariculture products.The project provided additional employment to about 123,700 women, which amounts to56 percent of the total jobs created. Emphasis was given to the training of women, withabout 50 percent of the trainees who attended training courses organized under the projectbeing women. The project also provided women with access to small credits for theconstruction of rabbit cages, purchasing of fine breeds of rabbits and other activitiesrelated to this component.

7. Sustainability. The benefits generated by the irrigation and livestock activitiesare likely to be sustained throughout the life of the project, as the project beneficiarieshave strong financial incentives to operate their investments profitably, themacroeconomic framework is expected to remain relatively stable, and commodity priceforecasts indicate no substantial changes in world supply/demand conditions for projectproduction. Therefore, for these components the project implementing agencies will not

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be required to provide any significant technical or financial assistance in the future exceptfor routine supervision of project activities. However, the Government will continue toneed to provide investment funds and recurrent budgetary support to complete theremaining on-farm works and to ensure proper implementation of the proposed watercharges, which will have a direct impact on the operation and maintenance of thecompleted works.

8. Overall, the agroprocessing component is also likely to be sustainable. The plantswill need to continually improve product quality, closely monitor changing supply anddemand conditions in the marketplace, and be given sufficient autonomy in marketing,pricing, and personnel management. In addition, they should ensure that all requiredwastewater treatment systems are fully operational by the end of the production testingperiod.

9. Future Operation. The future operation of the project will require someadditional assistance from the provincial PMO. Its main responsibilities will be(a) continued supervision of the irrigation, livestock, and agriculture activities;(b) provision of recurrent budgetary support as necessary to complete some of the on-farm works, and the agroprocessing program; (c) guarantee of adequate provision ofincremental working capital as agroprocessing plants reach full production; (d) closemonitoring of the financial profitability of the agroprocessing plants, and development ofrestructuring plans as required; and (e) preparation of an action plan to ensure that watercharges meet the full annual operation and maintenance costs. IDA will continue tomonitor progress of the actions to be taken by the PMO during supervision of otherprojects in the province.

10. Lessons Learned. The key lessons learned from the project include thefollowing: (a) stronger measures should have been taken early in the implementation ofthe project to ensure that on-farm works were completed on schedule, and that funds wereallocated specifically for on-farm works; (b) the Association should have ensured theearly installation of wastewater treatment systems for agroprocessing plants by buildingappropriate conditions into project implementation, which should have been covenantedin the legal documents; (c) in addition to written assurances obtained at negotiations fromprovincial and local governments that adequate funds would be made available to theproject units in a timely fashion for the execution and operation of the project, theestimated annual amount of counterpart funds necessary for the project (together with theassumptions from which these figures are derived) should have been identified anddiscussed at appraisal with the Borrower, in order to ensure that proper attention was paidto the financing of the Project; (d) more supervision missions should have been budgetedand planned to resolve issues/problems as they developed; and (e) advice from technicalexperts should have been solicited in the selection of appropriate agroprocessingequipment for a number of the plants, and a local unit should have been established tocarry out market investigation/analysis.

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CHINA


PART I. IMPLEMENTATION ASSESSMENT

A. PROJECT OnJEcrIVEs

1. The main objective of the project was to assist the Shandong ProvincialGovernment to: accelerate the development of agriculturally unproductive coastallowlands for culture fisheries; intensify crop production in existing low-yielding areasand increase the value of livestock production and processing in the Tuhai River Basin;and help alleviate poverty and provide productive employment for women throughupgrading of production and processing of small livestock in the poverty-stricken YiMeng mountain area. The main features of the project were as follows:

(a) A coastal development component, including the cultivation of shrimp andspecialty seafood; construction of hatcheries, feedmills, cold-storage,processing facilities and service centers; and strengthening research anddevelopment;

(b) The Tuhai River Basin component including improvement and expansionof five irrigation areas; provision of agricultural input and supportservices; development of Chinese dates intercropped with food grain andfast-growing trees; processing of dates, feed and meat; improvement ofgrassland areas; and rearing and breeding of beef, cattle, sheep andbroilers;

(c) The Yi Meng livestock component, including rearing and breeding ofrabbits, pigs, chickens, and geese; processing of livestock feed, meat,goosedown, rabbit-wool; and veterinary services; and

(d) A project management component including the provision of technicalassistance and training; and applied research.

2. The objectives were generally well designed, spelled out in the projectdocumentation, and supported by project staff and beneficiaries. Similarly, theyappropriately reflected the Government's implementation capacity and were consistent

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with both the Government's development strategy and the Bank's Country AssistanceStrategy at the time of preparation.

B. IMPLEMENTATION EXPERIENCE AND RESULTS

3. The project substantially achieved the objectives of agricultural growth in thecoastal areas of Shandong. As a result of the strong performance of most subcomponentsof the mariculture component, the agriculture, livestock, and most agroprocessingcomponents, the overall economic return of the project is re-estimated at 31 percent,slightly above the appraisal estimate of 29 percent.

4. Physical Results. In terms of physical targets, the project has generally achieved,and in many cases exceeded, the targets set out in the project documents. Total irrigationrehabilitation and expansion amounted to 284,200 ha, in excess of the original target of271,600 ha. Chinese dates and other fruits intercropped with food grains wereestablished on 56,540 ha, against an appraisal target of 50,000 ha. Fast-growing treeswere established on an area of 3,000 ha (100 percent of SAR estimate). Breeding farmsfor cattle, sheep, meat rabbits, hair rabbit, pigs, geese, and chickens were established andproduced the expected output. Thirty-eight agroprocessing plants were constructed,against an initial plan of 42 factories. In the coastal area, 4,333 ha of shrimp ponds wereestablished, against an initial target of 5,350 ha. Special seafood ponds including 533 haof scallops, 200 ha of sea cucumbers, and 66 ha of abalone were rehabilitated as planned.The livestock development component in the Yi Meng mountainous area exceededappraisal estimates substantially for breeding geese (250 percent of SAR estimates),chicken (145 percent) and pigs (325 percent), but showed a shortfall in rabbit production(75 percent the SAR estimate) as a result of declining interest by township farms in rabbitbreeding.

5. Agricultural Benefits. The irrigation and drainage component was successful inrehabilitating and expanding five irrigation schemes in the Tuhai River Basin. The totalcost of the irrigation component was $55.62 million or 23 percent of total project costs,compared to an SAR estimate of $66.7 million. The project included the constructionand expansion of irrigation works on 284,200 ha of land for wheat, corn, soybean, cotton,peanuts and vegetables. In terms of agricultural output, yields and production levels forcrops were well above the "with project" case assumed at appraisal. However, for cottonthe yields were below appraisal targets (81 percent of SAR) as a result of the serious pestand disease problems. The total annual crop output increased during the project periodby 269,500 tons for wheat, 220,450 tons for corn, 27,420 tons for soybeans, 2,580 tonsfor cotton, 19,200 tons for peanuts, and 931,000 for fodder. Fruit tree yields and outputsincreased substantially by 137,000 tons for dates, 37,880 tons for other fruits and134,000 m3 for lumber. Preliminary data for 1995 show a further increase in yields andproduction for all crops as farmers diversified crop production and increased inputs inresponse to higher market prices. The crop yields currently achieved in the project areaare higher than anticipated during appraisal. The quality of most of the completed workswas good, and complied with national standards for safety, health and the environment.

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6. The increased outputs from crop and forestry production resulted in higherincomes for participating farm households. The annual gross value of incrementalproduction was about Y 412 million for the food crops, Y 330 million for the commercialcrops, and Y 267 million for dates, fruit and forestry products.

7. Mariculture and Animal Husbandry Benefits. The project developed shrimpponds on 4,333 ha and 800 ha of shallow water ponds for the cultivation of scallops,abalone, and sea cucumbers. The cost of the mariculture component amounted to $99.5million or 41 percent of the total project costs, compared to the SAR estimate of $110.3million. The production of scallops, sea cucumbers, and abalone was satisfactory,generally exceeding appraisal estimates. The yield and production levels for shrimp werelower than appraisal estimates because of a serious shrimp virus infestation in 1993. Thefinancial impact of the shrimp disease problem has been substantial, but the high returnson specialty seafood production have compensated for the losses, at least in economicterms.

8. The introduction of new, improved breeds of animals under the project has led toproductivity gains in the sector. ERRs were recalculated for each category of livestockproduction, using production input costs and output prices provided by the projectmanagement office. The consolidated ERR for the livestock component amounted to27 percent, lower than the estimated 35 percent at appraisal, mainly as a result of costincreases for inputs.

9. Agroprocessing Benefits. The project financed the development of 38processing plants, including 5 food processing plants for dates, apples and other fruit, 8feedmills, 11 meat processing plants, 2 wool processing mills, 2 tannery plants, and1 eider down factory. The total cost of this component is $46.9 million or 19 percent ofthe total project cost. This compares to an appraisal estimate of 42 plants for a total costof $40.2 million. The high rate of domestic inflation prevailing during the second half ofthe project, particularly for local building materials and equipment, increased localcounterpart funding requirements and affected the time of completion of some of theproject investments. All agroprocessing facilities were constructed as designed andapproved by the Bank Group.

10. Overall, the plants have performed well and have met their expected productiontargets and rates of return, however some of the factories experienced significant initialproblems with raw material availability, changing market conditions, and inadequateworking capital. This has led to delays in commissioning, and some plants have yet toreach their designed output levels. To date, all but three agroprocessing plants have beencommissioned and are fully operational. Their economic rates of return were recalculatedand range from 20.8 percent for fruit processing to 58 percent for rabbit slaughter plants.The remaining three plants, two cattle slaughter lines in Tuhai and a pig slaughterhouse inYineng are expected to become operational in early 1996. The agroprocessingcomponent has resulted in the incremental production of 160,000 pieces of down

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products, 4.2 million pieces of leather or fur products, 38,500 tons of processed meat. 450tons of knitting products, 2,700 tons of food products, and 44,000 tons of feed.

C. PROJECT IMPACT

11. Apart from a strong impact on poverty alleviation in the project area, the projectgenerated productive job opportunities, mainly geared to women in the poor Yi Mengmountain area. Particularly, the raising of small livestock that is traditionally done bywomen had a significant impact on poor households. The rabbit raising program hastransformed the traditional outdoor system into a more intensive, individually managedsystem, and has helped a large number of women in the project area to increase theirincomes. In addition, the project provided access to new productive work opportunitiesfor women not only at home but also as workers in the breeding farms. Incrementalemployment was created in new processing activities such as meat-packing, goose featherand down processing, rabbit wool spinning, knitting, date processing, and packaging ofmariculture products. The project provided additional employment to about 123,700women, which amounts to 56 percent of the total jobs created. Emphasis was given tothe training of women, with about 50 percent of the trainees who attended trainingcourses organized under the project being women. The project also provided womenwith access to small credits for the construction of rabbit cages, purchasing of fine breedsof rabbits and other activities related to this component.

D. MAJOR FACTORS AFFECTING THE PROJECT

12. Implementation Schedule. The project was scheduled for completion inDecember 1994, five years after signing. The major civil works program, the largestsingle expenditure category accounting for 54 percent of total base costs, wasimplemented on schedule. There were, however, some delays in the construction of on-farm works due to a shortage of local counterpart funds, partly as a result of exchangerate changes and increased cost of building materials. In retrospect, it would have beenbetter to schedule these works earlier in the project life and strictly reserve fundsallocated to them. Overall, there was a major change in counterpart financingarrangements, with the Provincial Government providing about $40 million more thanplanned and the local governments giving only a third of the amount expected. Whilethis did not seriously affect the overall project outcome, it led to some implementationdelays at the local level. The equipment procured by International Competitive Biddingwas delivered more or less on schedule, with most of the deliveries taking place between1993 and mid-1994. Slight delays were experienced with the supply of agroprocessingequipment. The construction of some agroprocessing plants was delayed as a result ofadditional requirements from equipment manufacturers, such as the provision of detailedfloor plans.

13. Shrimp Disease. China experienced a serious viral shrimp infestation in 1993.This disease affected P. orientalis, which is the native white shrimp variety generallycultivated in northeast China. The virus is currently known as HHNBV, and is

commonly called Chinese Shrimp Virus. The disease outbreak affected the livelihood ofthousands of shrimp farmers, and feed mills and cold stores operators. In 1994, in spiteof extensive changes to the culturing practices, the virus again had a serious impact onproduction in Zhanhua county and Hanting district. Potential contributing factors includeoverly high stocking rates, deteriorating water quality, changes in pH, inappropriate feedand feed management, infected broodstock, etc. So far, measures taken to minimize theproblem include the adoption of closed water systems, lowering the stocking density ofshrimp Post Larvae, use of compound feed, and experimentation with polyculturesystems. Although improved management methods were gradually introduced duringproject implementation, the project shrimp growers were unable to avoid serious losses.To date, none of these measures has proven successful. Recently, diversification intoalternative species such as crab and clams and polyculture with other crustacea, asencouraged by IDA during the last few supervision missions, have been piloted and areshowing promising results.

14. Training and Technical Assistance. The training program covered a wide rangeof topics. A total of about 2 1 0 different local and foreign training classes and study tourswere organized for project staff at different levels. Some 12,880 person-months oftraining were taken, covering topics such as fertilizer application; seed testing, processingand multiplication; date/apples intercropping with grain; fruit processing; livestockmanagement, production, disease control; and aquatic products production, management,and breeding. Local universities and academies provided support in feed formulation andbrood-stock management and technical guidance in mariculture production andprocessing. The research topics undertaken covered soil/water studies, micro-irrigation,effective use of water resources, etc. and were commissioned by Qinghua University,Hehai University and Shandong Industrial University. Experts from the ChineseAcademy of Agricultural Sciences were also invited to assist in the monitoring andevaluation of the project. A total of Y 8.0 million was spent to carry out the aboveresearch.

15. Procurement. Preparation of bid documents, bid invitation, evaluation andaward were carried out by the Provincial Rural Economic Development and InvestmentCorporation in cooperation with the Provincial Project Management Office (PMO) andcounty Project Offices (POs). The bulk of the equipment purchased overseas wasprocured through International Competitive Bidding (ICB) procedures, which presentedfew administrative problems. By the end of 1994, some 43 contracts, valued at $52.42million, were procured under ICB. The balance of the equipment purchased wasprocured under national competitive bidding (NCB) and shopping procedures because thesize of the contracts was too small to justify ICB. Overall, ICB procedures resulted insatisfactory supply of equipment. However, some problems were experienced with theNCB supply of certain equipment that failed to meet technical specifications.

16. Disbursement. The pattern of disbursements was fairly close to the appraisalestimates. The IDA Credit was fully disbursed on December 12, 1994, before the closingdate. Project expenditures were estimated to be about $240.4 million. The total amount

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disbursed was $114.04 million equivalent, which was higher than the original creditamount of $109 million equivalent, due to the depreciation of the US dollar against theSDR

17. Credit Allocation. The actual allocation of funds by expenditure category was,by and large, as anticipated, with a modest reallocation of consultants' services andtraining funds to accommodate an increase in civil works costs, including an increase inthe percentage of expenditures to be financed for civil works under Category (I) from30 percent to 45 percent.

E. PROJECT SUSTAINABILITY

18. The benefits generated by the irrigation and livestock activities are likely to besustained throughout the life of the project, as the project beneficiaries have strongfinancial incentives to operate their investments profitably, the macroeconomicframework is expected to remain relatively stable, and commodity price forecasts indicateno substantial changes in world supply/demand conditions for project production.Therefore, for these components the project implementing agencies will not be requiredto provide any significant technical or financial assistance in the future except for routinesupervision of project activities. However, the government will need to provide theremaining investment funds and recurrent budgetary support to complete the on-farmworks and to ensure proper implementation of the proposed water charges, which willhave a direct impact on the operation and maintenance of the completed works.

19. The agroprocessing component is also likely to be sustainable overall, though thestatus of two plants remains uncertain at this point. The plants will need to continuallyimprove product quality, closely monitor changing supply and demand conditions in themarketplace, and be given sufficient autonomy in marketing, pricing, and personnelmanagement. In addition, they should ensure that all required wastewater treatmentsystems are fully operational by the end of the production testing period. All subprojectswill require close supervision by project staff and restructuring plans will have to bedeveloped for any of the plants that fail to become profitable after two or three yearsfollowing commissioning. The firms should also be encouraged to implement enterprisereform measures in line with the transition to a market economy, including thetransformation of state-owned enterprises into shareholding companies or joint ventureswith foreign companies.

20. The sustainability of the shrimp component is uncertain in view of the seriousviral disease problems facing the shrimp industry in the project area. An action planshould be prepared for further diversification of the industry away from shrimps toalternative crustacea or polyculture with crab, fishing or clams.

F. IDA PERFORMANCE

21. IDA's performance in identification, preparation, and appraisal of the project isviewed as satisfactory to highly satisfactory. This work was directly based on the

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government's development strategy, the Bank's Country Assistance Program, theimplementation of earlier projects such as the Seeds Project and the Irrigated AgriculturalIntensification Project, and detailed field work in Shandong province. As a result, therewas a fairly strong consensus between IDA and the government about the overallobjectives and design of the operation as well as the conditions necessary to ensuresatisfactory project implementation. During preparation and appraisal, IDA made anumber of useful suggestions regarding equipment specification, training needs, technicalassistance, and marketing that strengthened the technology transfer elements of theproject.

22. IDA's performance in supervision is considered satisfactory. The six supervisionmissions, which took place on a regular basis, on average once a year over the period1989-94, were adequate and considered useful by the PMO staff. The missionsaccurately reported implementation progress, identified key operational problems andprovided useful interventions and recommendations, paid close attention to the overalldevelopment impact of the project, and showed a high degree of flexibility in modifyingproject arrangements in response to changing implementation conditions. Supervisionmissions made significant contributions in the following areas: (a) improving thetechnical design and operating efficiency of many agroprocessing subprojects,(b) educating PMO staff on the need for more rigorous analysis of market conditions,(c) emphasizing the importance of training and technical assistance in the disseminationof new technologies, and (d) requiring adequate provision of counterpart funding andworking capital for project activities. The missions were also successful in promoting theestablishment of cooperatives for apple growers in the project area, an initiative that isnow being extended to vegetable and aquatic product producers. The missions were,however, less successful in assisting the PMO in recruiting overseas technical assistance.The project would, nevertheless, have benefited from more frequent supervision visits,which was not possible as a result of limited IDA resources available for supervision.

G. BORROWER PERFORMANCE

23. The project implementing agencies' performance in project preparation wassatisfactory, as it prepared a comprehensive feasibility study for the project thatadequately covered technical, financial, economic and institutional factors. The overallperformance during implementation was satisfactory. The PMO coordinated projectactivities well between the participating technical departments and was competentlystaffed throughout implementation. Project staff at all levels were generally committed tothe project objectives, implemented the project components generally in line wAith theagreed implementation arrangements, and took appropriate action to redress problems asthey occurred. Nonetheless, several project units would have benefited from moreregular visits by PMO and PO staff. Some project units faced serious problems withcounterpart fund availability and closer internal supervision might have been able toresolve these issues. Audit reports were generally produced and received on time.

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H. ASSESSMENT OF OUTCOME

24. The project's outcome is viewed as satisfactory, since the most importantobjective of agricultural growth and development in Shandong's coastal areas wasachieved with a relatively high degree of sustainability. The overall economic rate ofreturn of 31 percent is particularly impressive in view of the difficulties facing the shrimpand cotton subsectors, not only in the project area but throughout China, duringimplementation. Overall, the project had a fairly strong developmental impact throughthe provision of scarce investment funds for the expansion of agricultural production andvalue added processing in a relatively poor part of Shandong province. The project is notviewed as highly satisfactory because of the limited achievements of the shrimpproduction component, the delay in some of the agroprocessing plants commissioningand some shortfalls in the training component.

I. FUTURE OPERATION

25. The future operation of the project will require some additional assistance fromthe provincial PMO. Its main responsibilities will be (a) continued supervision of theirrigation, livestock, and agriculture activities; (b) provision of recurrent budgetarysupport as necessary to complete some of the on-farm works, and the agroprocessingprogram; (c) guarantee of adequate provision of incremental working capital asagroprocessing plants reach full production; (d) close monitoring of the financialprofitability of the agroprocessing plants, and development of restructuring plans asrequired; and (e) preparation of an action plan to ensure that water charges meet the fullannual operation and maintenance costs. The managers of the agroprocessing plants willneed to continually improve product quality, closely monitor changing supply anddemand conditions in the marketplace, and be given sufficient autonomy in marketing,pricing, and personnel management. In addition, they should be encouraged toimplement enterprise reform measures in line with the transition to a market economy.IDA will continue to monitor progress of the actions to be taken by the PMO duringsupervision of other projects in the province.

J. KEY LESSONS LEARNED

26. The key lessons learned from the project are summarized below:

(a) Stronger measures should have been taken early in the implementation ofthe project to ensure that on-farm works were completed on schedule andthat funds were allocated specifically for on-farm works.

(b) The Association should have ensured the early installations of wastewatertreatment systems for agroprocessing plants by building appropriateconditions into project implementation, which should have beencovenanted in the legal documents.

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(c) In addition to written assurances obtained at negotiations from provincialand local governments that adequate funds would be made available to theproject units in a timely fashion for the execution and operation of theproject, the estimated annual amount of counterpart funds necessary forthe project (together with the assumptions from which these figures arederived) should have been identified and discussed at appraisal with theBorrower in order to ensure that proper attention was paid to the financingof the Project.

(d) More supervision missions should have been budgeted and planned toresolve issues/problems as they developed.

(e) Advice from technical experts should have been solicited in the selectionof appropriate agroprocessing equipment for a number of the plants, and alocal unit should have been established to carry out market investigation/analysis.

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PART II. STATISTICAL TABLES

TABLE 1: SUMMARY OF ASSESSMENT

A. Achievement of Objectives Substantial Partial Negligible Not ApplicableMacroeconomic Policies XSector Policies XFinancial Objectives XInstitutional Development XPhysical Objectives XPoverty Reduction XGender Issues XOther Social Objectives XEnvironmental Objectives XPublic Sector Management XPrivate Sector Development XOther (Specify)

B. Project Sustainability Likely Unlikely Uncertainx

C. Bank Performance Highly Satisfactory Satisfactory DeficientIdentification XPreparation Assistance XAppraisal XSupervision X

D. Borrower PerformancePreparation XImplementation XCovenant Compliance X

E. Assessment of Outcome X

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TABLE 2: RELATED BANK LOANS/CREDITS

Loan/Credit No. Year ofTitle Purpose Approval Status

Preceding Operations

Seeds Project To develop the seed industry by mod- FY85 Completed(Cr. 1577-CHA) ernizing facilities at 18 seed production,

processing and distribution centers,including the strengthening of theNational Seed Corporation's seedtesting and certification services. Theproject would also serve as a model forthe planned construction of over 300seed centers.

Following Operations

Irrigated Agriculture Improve and expand irrigation and FY91 OngoingIntensification Project drainage on about 1.14 million ha of (closing(Ln. 2256/Cr. 3337-CHA) low- and medium-yield land and sup- 06/97)

ported by a package of agriculturalsupport services

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TABLE 3: PROJECT TIMETABLE

Steps in Project Cycle Date Planned Date Actual/Latest Estimate

Identification (Executive January 22, 1988 January 12, 1988Project Summary)Preparation March 1, 1988 March 14, 1988Appraisal September 1,2 1988 September 17, 1988Negotiations March 6, 1989 March 20, 1989Board Presentation April 27, 1989 May 16, 1989Signing September 14, 1989Effectiveness September 1989 January 29, 1990Mid-term review September 24, 1992Project Completion December 31, 1993 December 31, 1993Credit Closing December 31, 1994 December 31, 1994

TABLE 4: CREDIT DISBURSEMENTS: CUMULATIVE ESTIMATED AND ACTUAL

($ million)

FY90 FY91 FY92 FY93 FY94 FY95

Appraisal estimate 22.0 54.0 90.0 104.0 109.0

Actual 17.2 49.6 70.7 92.9 113.0 114.0La

Actual as % of estimate 78.0 92.0 79.0 85.0 104.0

Date of final disbursement December 12, 1994

Za Higher actual disbursement in US dollar terms than estimated at appraisal waspossible due to depreciation of the US dollar against the SDR.

- 13 -

TABLE 5: KEY INDICATORS OF PROJECT IMPLEMENTATION

Key implementation indicators in SARIPresident's Report Estimated Actual

I. Tuhai Irrigation Irrigation and Drainage:Earth worksConveyance canal (000m3) 971.3 1,496Silt retention basin (000m3) 5,276.1 5,769.5Main canal (000m3) 10,724.5 11,915.8Branch canal (000m3) 10,695.9 11,007.3Drainage canal (000m3) 14,738 8,141On-farm works (OOOm3) 20,629 19,812.1Storage basin (000m3) 16,100 5,084StructuresFlumes-conveyance/main canals (No.) 27 17Flumes-branch (No.) 25 16Controls-conveyance/main canals (No.) 118 192Controls-others (No.) 491 204Bridges-conveyance (No.) 18 22Bridges-culverts-main/branch (No.) 878 575Bridges-culverts-others (No.) 85 97Offtakes-Main/branch (No.) - 202On-farm structures (No.) 8,033 5,208Pumping stations (No.) 20 12Tubewells fielded (No.) 3,440 1,408Land acquisition (ha) 1,091 4,050Buildings (m 2 ) 26,250 5,900O&M Machinery ProcuredHydraulic excavators (No.) 5 5Dredgers (No.) 2Bulldozers (No.) ITractors (No.)Utility vehicles (No.) 4 3Area InfluencesImproved irrigated area (ha) 81,400 106,000Expanded irrigated area (ha) 190,200 178,200Anrnual O&M costsTotal (Y) 43,340,000 42,600,000Per hectare (Y/ha) 153 150Total water charges collected (Y) 45,000,000 46,900,000

II. Agriculture and ForestryFertilizer imported (tons) 45,000 50,000Seed center upgraded (No.) 12 12Forest trees established (ha) 2,934 3,000Dates intercropped (ha) 50,000 47,540Fertilizer consumptionTotal (tons) 81,066 107,484DAP (tons) - 26,871Total per hectare (t/ha) 177 212

- 14-

Key itnplementation indicators in SARIPresident's Report Estimated Actual

huproved Seed ProducedWheat (tons) 9,000 9,837Maize (tons) 3,200 12,067Cotton (tons) 6,500 5,101Others (tons) - 216Seed Production CostsWheat (Y/ton) - 291Maize (Y/ton) - 349Cotton (Y/ton) - 1,503Average Irrigated YieldsWheat (t/ha) 3.5 4.0Maize (t/ha) 3.8 4.0Soybean (t/ha) 1.6 1.9Cotton (tlha) 0.8 0.7Average Rainfed YieldsWheat (t/ha) 2.5 3.3Maize (t/ha) 2.7 3.2Soybean (tlha) 1.6 2.6Cotton (t/ha) 0.6 0.5Intercropped Date YieldsSmall dates (t/ha)Large dates (t/ha) 1.3 2.9

IlL Livatock Tuhai Area:Breeding Fanm EstablishedChicken (No.) - ISheep (No.) -I

Breedine Stock ProcuredCattle (No.) 50 155Sheep (No.) 3,030 3,030Chicken (No.) 10,000 10,000Credit DisbursedTotal amount (Y) 4,780,000 3,380,000No. of households (No.) 8,250 1,546Grassland/Pasture Developed (ha) 5,333 3,333A.I. facilities in operation (No.) - 7Technical centers (No.) 4 4Yi Meng Areas:Rabbit-county farm (No.) 6 6Rabbit-township farm (No.) 56 13Hair rabbit-county (No.) - -

Pig I IGoose (No.) I IChicken demonstration farm (No.) I IBreeding chicken farm (No.) 1 2Credit DisbursedTotal amount (Y) 14,960,000 14,320,000No. of households (No.) 30,000 29,410

- 15 -

Key implementation indicators in SAR/President's Report Estimated Actual

MiscellaneousA.I. facilities in operation (No.) - 42Technical/veterinary centers (No.) 7 7Women technician trained (No.) 19,845 21,421Performance IndicatorsCattle (No.) - 4,295Sheep (No.) 2,400 4,450Meat rabbit (No.) 254,800 152,000Hair rabbit (No.) 99,800 107,000Pig (No.) 800 3,000Goose (No.) 25,000 62,500Chicken (No.) 3,800,000 5,520,000No. of Households SuppliedSpecialized households (No.) 38,250 30,956Demonstration households (No.) - 18,324Other households (No.) - 924,720A.1, performed (No.) 4,000 40,000Credit recoveredTotal amount (Y) - 87,483,000% of amount due(%) - 100

IV. Agroprocessing Physical ProgressUnits under Construction:Abattoir (No.) - 3Units in Operation:Abattoir (No.) 10 7Cold stores (No.) 11 10Tannery (No.) 3 2Wool/textile plants (No.) 3 2Goose down mill (No.) I IFeedmills (No.) 11 8Fruit processing plants (No.) 5 5Performance IndicatorsAbattoiTotal production (tons) 18,100Total sales-domestic (tons) 7,841

-export (tons) 9,276Amount in stock (tons) 983Capacity utilization % 65Sales price-domestic (Y/t) 12,699

-export (Y/t) 17,171Op2erating CostsTotal (Y) 203,504,000Per unit output (Y/t) 11,243Total costs-including overheads (Y) 219,473,000Net Income (Y) 39,384,000

- 16-


Leather/FuTotal production (pieces) 4,200,000Total sales-domestic (pieces) 2,355,000

-export (pieces) 1,845,000Amount in stock (pieces) 82,000Capacity utilization % 98Sales price-domestic (Y/piece) 5,700

-export (Y/t) 7,450Qpeatng CamTotal (Y) 19,385,000Per unit output (Y/t) 4.6Total costs-including overheads (Y) 19,740,000Net income (Y) 5,170,000Rpinnin MUIlTotal production (tons) 450Total sales-domestic (tons) 185

-export (tons) 124Amount in stock (tons) 141Capacity utilization % 69Sales price-domestic (Y/t) 85,000

-export (Y/t) 105,000Operating CostTotal (Y) 30,450,000Per unit output (Y/t) 67,667Total costs-including overheads (Y) 31,000,000Net income (Y) 12,980,000D)own ProductsTotal production (pieces) 162,000Total sales-domestic (pieces) 104,000

-export (tons) 50,000Amount in stock (tons) 8,000Capacity utilization % 97Sales price-domestic (Y/piece) 91

-export (Y/piece) 91Operating CostTotal (Y) 11,602,700Per unit output (Y/piece) 71.6Total costs-including overheads (Y) 11,947,200Net income (Y) 4,710,800Feed MillTotal production (tons) 44,000Total sales-domestic (tons) 35,860

-export (tons)Amount in stock (tons) 8,140Capacity utilization % 82Sales price-domestic (Y/t) 1,900

-export (Y/t)

- 17-

Key implementation indicators in SARIPresident's Report Estimated Actual

Operating CostTotal (Y) 61,451,400Per unit output (Y/t) 1,396Total costs-including overheads (Y) 62,911,400Net income (Y) 16,150,600Fruit ProcessingTotal production (tons) 2,668Total sales-domestic (tons) 2,054

-export (tons) 452Amount in stock (tons) 162Capacity utilization % 100Sales price-domestic (Y/t) 5,600

-export (Y/t) 9,600Operating CostsTotal (Y) 11,531,600Per unit output (Y/t) 2,113Total costs-including overheads (Y) 13,375,600Net income (Y) 9,936,400

V. Mariculture Pvsical Progrssi) Prawn Subcomp2onentSea dikes constructed (km) 32.7 32.7Canal earthworks, etc. ('OOOm3) 8,704 7,886Main sluice gates (No.) 16 16Bridges and culverts (No.) 3,290 2,857Shrimp PondsEarthworks/stonework ('OOOm3) 28,250 29,448Sluice gates (No.) 74 43Feeder Roads (kum) 58.5 59.5Facilities in OperationShrimp ponds (No.) 1,600 1,300Substations (No.) 3 3Pumping stations (No.) 3 3Hatchery (No.) 3 3Feedmills (No.) 3 3Cold stores (No.) 3 3Technical centers (No.) 4 4Vehicles procured (No.) - -

Sampans procured (No.) - -

ii) Special Seafood SubcorponenArea under ProductionAbalone (ha) 66 66Scallop (ha) 533 533Sea cucumber (ha) 200 200Vehicles procured (No.) - -

Boats procured (No.) 7 10

- 18 -


Performance IndicatorsTotal ProductionShrimps (tons) 8,800 5,200Abalone (tons) 248 30Scallops (tons) 15,900 24,000Sea cucumber (tons) 224 25Yield per HectaShrimps (t/ha) 1.65 1.2Abalone (t/ha) - 0.45Scallops (t/ha) 30 45Sea cucumber (t/ha) 0.112 0.115iii) Shrimp SubcomponentShrimp feed consumed (tons) 35,200 18,045Feed conversion rate (%) 25 25Shrimp stocking rate (No./ha) 300,000 180,000Shrimp sales-domestic (tons) 4,400 2,482

-export (tons) 4,400 1,650Sales price-domestic (Y/t) 15,000 60,000

-export (Y/t) 14,050 80,000Total operating costs (Y) 64,200,000 71,829,600Operating costs per hectare (Y) 12,000 16,577Net income (Y) 57,780,000 109,970,000Net income per hectare (Y/ha) 10,800 25,379iv) Shrimp HatcheryTotal capacity ('000m3) 12 12Total production ('000 units) 160,000 120,000Sale price (Y/t) 7.6Cold StoreTotal capacity (tons) 2,500 2,500Amount purchased: - 8,000- Shrimp (tons) - 3,560- Other commodities (tons) - 4,440

Average in store per day (t/day) - 2,000Capacity utilization % - 80

- 19-

TABLE 6: KEY INDICATORS FOR PROJECT OPERATIONS

Key operating indicators in SAR/ Estimated ActualPresident's Report

1. Tuhai irrigation & drainageFRR/ERR N.A. / 33.6% 29.5% / 35%Yield (t/ha)

Wheat 3.5 3.7Corn 3.8 3.0Soybean 1.65 1.34Cotton 0.8 0.61

2. MaricultureShrimp

FRR/ERR 18.3-18.7%/22.4% 15.2%/18.1%Yield (t/ha) 1.65 1.2

Specialty seafoodFRR/ERR 21.9-39.8%/ 27.7% 26.9% / 43.2%Yield (t/ha)

Scallops (shell-on) 45.0 45.0Abalone (shell-on) - 42.9Sea cucumber (dried) 0.112 0.125

3. LivestockRabbit

FRR/ERR 28-44% /25.9% 14-19% / 18.4-23%Yield (kg/animal) 2.3 2.5

PoultryFRR/ERR 61%/44.8% 15-17%/25.3-27.1%Yield 2.1/chicken, 4.5/goose

PigFRR/ERR 77-78%/45.5% 10.2% /21.7r/Yield

Cattle/SheepFRR/ERR 15% Cattle /51.7% 12.9%/o / 39.2%

57% Sheep 11.2% / 39.2%Yield 45l/cattle, 20/sheep

4. Date interplantingFRR/ERR 27% / 27% 33.3% 37.8%Yield (tlha) 1.3 2.9

5. Tree plantingFRR/ERR 40% / 42% 23.2% / 27.4%Yield (m 3 ) 70 66

- 20 -

TABLE 7: STUDIES INCLUDED IN PROJECT

Not applicable

TABLE 8A: PROJECT COSTS

Appraisal estimate Actual/latest estimateLocal Foreign Local Foreign

Item costs costs Total costs costs Total

Tuhai River BasinIrrigation & drainage 47.6 19.1 66.7 37.2 18.4 55.6Agriculture & forestry 5.5 14.3 19.8 7.0 14.1 21.1Livestock production 2.0 1.4 3.4 2.5 1.9 4.4Agroprocessing 7.5 5.3 12.8 9.1 11.0 20.1

Subtotal 62.6 40.1 102.7 55.9 45.4 101.3

Coastal AreaShrimp produ.tion 61.2 30.6 91.8 48.5 28.7 77.3Special seafood production 5.4 13.1 18.5 7.3 14.9 22.2

Subtotal 66.6 43.7 110.3 55.9 43.6 99.5

Vi A ountainLivest" . production 6.5 3.4 9.9 6.0 5.3 11.3A"-oprocessing 14.4 13.0 27.4 7.3 19.4 26.8

Subtotal 20.9 16.4 37.3 13.3 24.7 38.0

Institutional Support 0.3 0.6 0.9 1.3 0.3 1.6

Base Cost 150.4 100.8 251.2 126.4 114.0 240.4

Physical contingencies 5.0 3.0 8.0 - - -Price contingencies 8.1 5.0 13.1 - - -

Total 163.5 108.8 272.3 126.4 114.0 240.4

- 21 -

TABLE 8B: PROJECT FINANCING

($ million)

Appraisal estimate Actual estimateSource Local Foreign Local Foreign

costs costs Total costs costs Total

IDA 0.2 108.8 109.0 0.0 114.0 114.0Central Government 10.8 0.0 10.8 0.0 0.0 0.0Shandong Government 7.0 0.0 7.0 47.3 0.0 47.3Prefecture/County Govern. 113.2 0.0 113.2 37.9 0.0 37.9Agricultural Bank of China 32.3 0.0 32.3 41.2 0.0 41.2

TOTAL 163.5 108.8 272.3 126.4 114.0 240.4

TABLE 9: ECONOMIC COSTS AND BENEFITS

Economic Rate of Return Appraisal estimate (%) ICR estimate (%)

Project as a whole 29.0 31.3Irrigation 33.6 35.0Mariculture 24.0 23.7Livestock 34.6 26.7Date planting 27.0 37.8Tree planting 42.0 27.4

Table 10: STATUS OF LEGAL COVENANTS

Covenant Present Original ful- Revised ful- DescriptionAgreement Section type status fillment date fillment date of Covenant Comments

Credit 3.01(a) 5 C - The Borrower declares its commit- Province performed inment to the objectives of the accordance with provisionsproject ... shall cause the Province to of Project Agreement.perform in accordance with theprovisions of the ProjectAgreement...

3.01(b) 3 C - Borrower shall make the proceeds of Satisfactory arrangementsthe Credit Available to the Province were made for proceeds ofin accordance with the arrangements the Credit available to thesatisfactory to the Association. Province.

Project 2.05 3 C 11/01 - Province shall prepare and furnish to Detailed budget, workAssociation for review by Nov. 1 of program and O&Meach year, a detailed budget and submitted regularly to IDA.work program and O&M of existingfacilities for the following year.

3.01 1 C 06/30 - Have accounts referred to in para. (a) Audit reports received forof this Section, including the Spcial each calendar year.Account for each fiscal year audited,in accordance with.

3.0lb(ii) I C 06/30 - Furnish to the Association audited As above.accounts not later than 6 months afterthe end of year....

3.02 2 NC 12/31/94 12/31/96 Water charges be set, adjusted and Recommendationscollected, as necessary to covcr the forwarded to Provincialfull O&M costs and 200/o of the Govt. for approval.capital construction cost.

Covenant Present Original ful- Revised ful- DescriptionAgreement Section type status fillment date fillment date of Covenant Comments

Project 1 6 C - - Project activities conform to Project activities approvedSchedule 2: Provincial guidelines on by local EPA.

environmental control.

2 2 C - - Agroprocessing activities operate as Most plants managementindependent financial entities and generally satisfactory.managed by competent staff.

3 5 C - - Staff training would be carried out in Some delays encounteredaccordance with program agreed with in the training program. Hthe Association.

4 9 C 01/07 - Semiannual report to be furnished to Reports always sent on Othe Association within 30 days of the time to IDA. Iend of each 6-month period.

5 5 C 11/01 - A plan for the provision of chemical Fowarded yearly to IDAfertilizer requirements for the for review.following year. 0

Covenant types: Present status:

I= Accounts/audit 8 = Indigenous people C = covenant complied with o2 Financial performance/generate revenue from beneficiaries 9 = Monitoring, review, and reporting CD = complied with after delay3=cFlow and utioization of project funds 10i= Project implementation not covered in categories 1-9 CP = complied with partially4 = Counterpart funding II - Sectoral or cross-sectoral budgetary or other NC = not complied with5 Management aspects of the executing agency 12 = Sectoral or cross-sectoral policy/regulatory/6 = Environmental covenants institutional action7 = Involuntary resettlement resource allocation 13 = Other

- 24-

TABLE 1 1: COMPLIANCE WITH OPERATIONAL MANUAL STATEMENTS

Not Applicable

Table 12: BANK RESOURCES: STAFF INPUTS

Stage of Project Planned Revised Actalcycle__ _ _ _ __ _ _ _ ___ _ _ _ __ _ _ _

________ Weeks US$ Weeks US$ Weeks US$

Preparation to - 172.9 -

appraisal

Appraisal - - 25.8 -

Negotiations - - 7.8 -

through Boardapproval

Supervision - - 85.6 -

Completion - - 4.6 -

TOTAL

Table 13: BANK RESOURCES: MISSIONS

Specialized Performance ratings 2/Stage of project Month/year Number of Days in the staff skill Types ofcycle persons field represented 1/ Implementa- Development problems

tion status objectives

Through 12/87 to 17 49 A,AP,E,IE,appraisal 07/88 LS,F,

wAppraisal 09/88 to 11 10 A,E,IE. -

through Board 05/89approval 3/ _

Supervision 1 09/89 1 6 A. 1 1

Supervision 2 04/90 2 10 A,IE. 1 1

Supervision 3 06/91 6 7 A,AP,E,F,IE. 2 1 Counterpart___________ _____________ ~~~~~~~~~~~~~~~funding C

Supervision 4 10/92 7 9 A,AP,E,F, 2 1 Funding and MIE,I,LS. management

Supervision 5 11/93 4 12 A,F,IE,LS. I I Funding

Supervision 6 08/94 3 8 A,AP,F. 1 1 Funding

Completion A,E. X

1/ Key to specialized skills: A = Agriculturalist, AP = Agroprocessing specialist, E = Economist, F = Fishery specialistI = Institution specialist, IE = Irrigation engineer, LS = Livestock specialist.

2/ Performance ratings: I = problem free or minor problems, 2 = moderate problems, 3 = major problems.3/ Includes Negotiations.

- 26 -

TABLE 14: ROLE OF WOMEN IN PROJECT

Name of Component: Tuhai River Basin Component (including agriculture, forestry/fruits, animal husbandry,and agroprocessing sub-components)

Irrigation areas Percentage women Percentage women Women access to creditengaged in project participating in training ('000 persons)

l _______________________ activity

Tuhai project area 55 30 a/ 2.75 a!

Taochengpu 17

Guokou 16

Xingjiadu 13

Boqili 18

Handun 12a/ NO breakdown given tor irrigation areas.

Name of Component: Yimeng Livestock Component (separate table for agroprocessing)

Total households in Percentage women Percentage women Women access to creditproject county engaged in project participating in training ('000 persons)

activity

Yimeng project areas 76 49 29.4 a/

Feixian 80 50

Laiwu 78 48

Mengyin 69 44

Pingyi 73 52 l

Tengxian 66 55

Yinan 85 51

Yishui 82 44

Yiyuan pj 77 a 38a/ No brekdo-wn given tor project areas.

Name of Component: Coastal Development Component (including agroprocessing)

Total households in Percentage women Percentage women Women access to creditproject county engaged in participating in training ('000 persons)

_ _ _ __ I project activity _ _l__ _

Coastal project areas 26 5

Wudi 25 7

Zhanhua 27 6

Hanting 24 4

Penglai 28 5 l

-27 - ANNEX A

ANNEX A: MISSION AIDE-MEMOIRE

April 13, 1995

1. A Bank Mission comprising of Messrs. El-Hanbali, Ting, and Ms. Li visitedShandong Province from April 11 to 13, 1995, to review the preparation of theImplementation Completion Report (ICR) for the above captioned projects. The mission wasunable to undertake a full ICR mission for the two projects and instead took the opportunityduring the supervision of the Irrigated Agriculture Intensification Project to meet with stafffrom Shandong and Xinjiang in Jinan, Shandong, for three days to review the preparationcompleted by the two provinces. Initially, the mission briefed the project staff from SADPand XADP on the new requirements for the ICR. The mission was briefed by project stafffrom the Shandong Project Management Office (PPMO), and Xinjiang Foreign InvestmentOffice (XFIMO), on the preparations they have already made for the ICR. The mission wasimpressed with the efforts made in preparing the ICRs and the completion of the tablesforwarded to the two provinces prior to the arrival of the mission. The mission would liketo thank the Shandong PPMO, for the excellent arrangements, courtesy, and hospitalityextended to the mission during their stay in Jinan.

2. Representatives from the three provinces of the Irrigated AgriculturalIntensification Project (IAIP) also participated in the above meetings to familiarizethemselves with the requirements for the preparation of their respective ICRs. A subsequentseparate follow-up session was organized to deal specifically with the requirements for thepreparation of the ICR for the IAIP.

3. The main points and actions which were discussed and agreements reachedduring the three days deliberations are summarized below:

a. the mission stressed the importance of preparing a good completionreport to highlight the excellent achievements and experiences gainedunder the project; the Bank ICR guideline should be used only as areference in the preparation of the ICRs, the ICR should be succinctand where appropriate supported by annexes/tables and an evaluationsummary. The mission stressed the importance of highlighting thepositive as well as negative aspects of the project;

b. the report should comment on the technical assistance provided to

-28 - ANNEX A

XADP by the Australian International Development Assistance Bureau(AIDAB) the Danish International Development Assistance (DANIDA),and FAO/CP in the preparation of SADP;

c. the mission suggested the following areas which need to bestrengthened and/or where supplemental information is required:

i) project sustainability;

ii) key lessons learned;

iii) factors affecting implementation;

iv) future plans;

v) role of women and minorities;

vi) poverty alleviation;

vii) environmental issues;

viii) introduction of new technologies;

ix) operation and maintenance plans;

X) other social benefits; and

xi) details regarding irrigation development.

d. draft ICR prepared by the Bank is expected to be completed before July1, 1i995, and will be forwarded to both project offices for theircomments in late June and comments back to the Bank by August 1,1995;

e. XFIMO and PPMO will finalize the preparation of their owncompletion reports and forward the reports to the Bank by June 30,1995.

- 29 - ANNEX B

ANNEX B: BORROWER'S CONTRIBUTION TO THE ICR

IMPLMENTATION COMPLETION REPORT

CHINA

SHANDONG AGRICULLURAL DEVELOPMENT PROJECr

(CREDIT 2017-CHA)

JULY, 1995

Project Management Office

Shandong Planning Commission

People's Republic of China

30 - ANNEX B

WEIGHIS AND MEASURES

1 meter(m)=3.28 feet(ft)I kilometer=0.62 miles

1 hectare(ha)=2.47 acres1 muuO.067 ha

1 tornt)-1,000 kg=2,205 pounds(lbs)

1 kg-2.2 pounds( lbs)

FISCAL YEAR

Jamnary 1-December 31

A.EEVIATIOCS AND ACRNMr

ABC Agricultural Bank of ChinaCAS Chinese Academy of SciencesCAAS Chinese Academy of Agricultural SciencesHBC[f Haihe Engineering Command HeadquartersMIlC CNIIC International Tendering Ccompany, China National Technical

Import CorporationICB International Ccmpetitive BiddingI&D International Development Association1P04 Ministry of AgricultureMOF Ministry of FinancePLO Project Leading GroupFMD Project Management OfficePO Project OfficePREDIC Provincial Rural Economic Development and Investment

Corporation

-31- ANNEX B

Part I Eackground of the Project 1

Part II Project Implementation 1

1. Negotiation , Signing of the Agreements and Effectiveness 1

2. Changes Taking Place after the Appraisal 1

3. Progress of the Project Implementation 2

4. Local Check of the Project Ccmiletion 2

Part III Achievement of the Project Objectives - 3

Part IV Evaluation of the Project 4

1. Project Sustainability 4

2. Environmental Effects 5

3. Economic Evaluation of the Project 5

Part V Borrower Performance 6

1. Duties of the Departments 6

2. Monitoring and Evaluation of the Project 7

3. Assistant Service 7

4. Performance of the Project Offices and the Government Departments- 8

Part VI Performance of the World Bank 8

Part VII Future Operations 9

Part VIII Key Lessons Learned 10

Attached TAble 1

Attached TAble 2

Attached TAble 3

Attached TAble 4

Attached TAble 5

Attached TAble 6

- 32 - ANNEXB

IMPEENTATION COMPLErION REPQRTCHINA

SHANDONG AGRICULTURAL DEVELOPMENr PROJECr

1. Bacground of the Project1.1 The project proposal was put forward on the basis of the

irrvestigation report of the World Bank on the Tuhai River Basinand Shandong Provincial strategy on the agricultural developmentand it is continuity of the China Plain Agriculture Projectfinanced by the World bank and the first large-scale integratedagricultural development project in Shandong Province1.2 The project consists of three components , namely , culture

of shrimp and speciality seafood in the coastal areas , transforma-tion of the medium and lower yielding croplands in the Tuhai RiverBasin , and systematic livestock development in the Yimeng Mountainarea ; the project covers 22 counties and districts in the 9 citiesand prefectures , with integrated development of irrigation , plant-ing , aquaculture , livestock , forestry , and processing of theagricultural products and by-products .1.3 The project mission with officers mainly from FAO of the

United Nations reviewed the project in March , 1988 . The missionwas briefed by the departments involved , and had field visits ,collected a lot of data , and had discussions with project staffin Shandong Province about the project feasibility . Finally bothsides reached agreements , which laid foundation for projectappraisal . In the July of that year , the World Bank missionundertook project preappraisal ; in the September of the sameyear , general appraisal was undertaken by the World Bank mis-sion , and construction program was defined . Total cost of theproject was estimated at 273 million USD with 82.5 million SDRsfinanced by the Bank and lent to Shandong Province Governmentthrough the Ministry of Finance . Yearly interest of the creditis 5.5% with repayment period of 20 years -including five years ofgrace ; in addition , the Bank mission reached agreements withthe province on procurement , accounting statements , retroactiveinvestment , and monitoring of the environment , etc.

2. Project ImplementationNeotiation , Sjning of the Agreements and Effectiveness2.1 In the March of 1989 delegations of the International

Development Association and the Chinese government negotiated overthe project in Washington . Both sides-signed Agreement of theProject Credit and Agreement of the Project in the mid-Septemberof the same year . The credit became effective on January 29 , 1990Changes Taking Place after the Appraisal2.2 Major factors affecting the project As a result of some

changes taking place in the market and local situation , it is notnecessary to build some subcomponents defined at the appraisal icost overruns have taken place in the project construction due torevisions of the exchange rate and rise of costs of the buildingmaterials , equipment and labour , etc. ; too much time has beentaken in some purchases , making the procurement unable completelykeep up with progress of the project construction .2.3 In the September of 1992 , the Bank mission and the province

-33- ANNEXB

reached agreements on the mid-term revision program of the projectSome revisions of contents of the project constuction were made inlivestock component , mariculture component and Chinese date inter-cropped with grains ( see attached Table 1 ) i some necessary revi-sions were made on the procurement ( see attached Table 2 ) X somerevisions were also made on the expenditure categories and percen-tage of the foreign exchange with a reallocation of 600,000 SDRsof Category 3 to be used in Category 2 and an increase in thepercentage of expendatures to be financed for civil works underCategory 1 from 30% to 45%2.4 Change on the On-lending Arrangements . At the appraisal the

World bank decided that Shandong Province Rural Economic Developmentand Investment Corporation would receive , on-lend , recover andrepay the loan . Because of the rarious reasons ( which have beenreported to the Bank ) Slundong Province Government proposed throughthe Ministry of Finance to the Bank that the above-mentioned on-lending arrangement be changed , with Shandong Province FinanceBureau in charge of receiving , on-lending , recovering and repayingthe loan through the Ministry of Finance on behalf of the ProvincialGovernment , which was approved by the BankPrqj ss of the PreSect Iml ementation2.5 The project implementaion was started in January , 1990 and

closed on December 31 , 1994 . Through the five-year construction ,main contents of the project construction had been completed by theend of 1994 , and implementation of the components under the projectis good ( See attached Table 1 ) .2.6 Procurement . The PPO entrusted Shandong Rural Economic

Development and Investment Corporation to be in charge of the tech-nical operations of procurement and International Bidding Corpo-ration of China Technical Import and Export Company to be in chargeof the business operations . Procurement consisted of 33 packageswith total value of 53.76 million SDRs ( See attached Table 22.7 Training and Technical Assistance . Based on the project

implementation it covered a wide range of topics - engineeringproduction , rearing , processing , procurement , and institutionalmanagement , etc under components of agriculture , forestry , live-stock , mariculture and irrigation . A total of over 200 differenttraining courses/classes was offered and over 12,140 person-monthsof training were provided to the project staff under the project .6 local study tours with a total of 30 person-months were arrangedand 7 overseas study tours with a total of 23 person-months wereorganized ( See attached Table 3 ) . Local specialists were invitedto undertake research on saving-water irrigation , effective use ofwater resources , treatment of sediments , and shrimp diseases con-trol , etc , resulting in good results . In total 8 million Yuan fromthe Province Government was invested for the training and technicalassistance .2.8 Total Investment Cost . Overall actual project investment is

1,175.41 million Yuan ( 110% of SAR estimate ) , with 114 millionUSD , equivalent to 557.47 million Yuan , from the World Bank231.51 million Yuan from the province , 184.8 million Yuan from thecities , prefectures and counties , and 201.63 million Yuan fromlabour contribution .Local Check of the Project Completion2.9 The local check was undertaken according to the procedures

-34- ANNEX B

and methods stipulated by the PPO . At first , the county projectoffices organized designing and construction units and users toundertake preliminary check of the completed subcomponents and workout completion check reports X then , the Province AgricutureBureau , Forestry Bureau , Haihe Engineering Command Headquatersand Aquaculture Bureau would respectively check the subcomponentsin the project counties and work out the reports in their ownindustries , .nd based on the above-mentioned reports the PPOwould organized the technical deparments and units involved toundertake general check2.10 The local check of the project completion was completed

at the end of 1994 . According to the check , by and large , theproject implementation had exceeded the basic SAR targets , andover 92% of the completed subcomponents are excellent , with theremaining ones coming up to the standards3. Achievement of the Proiect ObLectives3.1 Remarkable economic , social and ecological benefits have

been achieved within a short time after the project operation .Under the project yields of the agricultural products , by-productsand processed products have increased substantially ( See attachedTable 4 ) . If we calculate based on comprehensive average pricesthere have been 5,367-million Yuan of output value and 724million Yuan of profit and taxes generated from the project , ofwhich there is 663 million Yuan of profit . The farmers in theproject area have benefitted from the project , with their netincome has been remarkably increased on a per capita basis ( Seeattached Table 5 ) .

3.2 The project has also provided productive employment forthe farmers , especially the women , and the project has directlyprovided employment for 218,700 people , of which there are123,700 women ( 56X of the total ) , resulting in raising socialstatus of the women . In addition , the women have played animportant role in the breeding , rearing and processing under thecomponents of livestock , poultry and aquaculture ( See attachedTable 6 ) .3.3 The project has also actively introduced and extentively

extended fine breeds and advanced technology . By the end of 1994in total through .the project the follwing fine breeds of animalswere made available to the farmers : 536,700 rabbits , 8.835 millionchickens , 196,500 geese , 9,220 pigs , 6,430 sheep , and 285 cattleRatio of coverage of the fine breeds in the project area hasincreased from 82% before the project to over 95% at present ; theadvanced technologies like water-saving irrigation , formula appli-cation of fertilizer , mulching , genetic engineering , microelec-tronics , and.nuclear radiation , etc have been extended or startedto be used . In 1994 unit outputs of wheat , corn and cotton in theirrigation project area were 52.5% , 43.6% and 6.5% respectivelymore than in 1988 , with quality and benefits of the products alsoimproved . It should be specially pointed out that role of demon-stration and radiation of the project area has become more and moreimportant , for example , in the 10 water-saving demonstrationareas , on the average , water can be saved by 20% per hectarewhich practice has been extended to 932,000 hectares of theprovince .3.4 The project has improved irrigation on 106,000 ha ( 130% of

-35- ANNEX B

SAR estimate ) , expanded irrigation on 178,200 ha ( 94% of SAR esti-mate ) , transformed 21,300 ha of saline land , reclaimed 21,500ha of wasteland , and solved the drinking problem of 480,000 peopleand 220,000 heads of stocks., which have substantially improvedproduction and living conditions of the farmers in the projectarea . In addition , as a result of irrigation construction anddevelopment of Chinese date ( fruits ) intercropped with the grainsand fast growing trees , on-farm wind speed has been slowed down byover 25% and the microclimate has been improved , resulting inachieving good ecological benefit .3.5 The project has achieved organic integration of agriculture

forestry , livestock and aquaculture with systematic and integrateddevelopment of production , processing , sales , and services ,resulting in not only strengthening construction of the basic faci-lities , but also comprehensively developing and using the resourcesand promoting vitalization of agriculture by way of science andtechnology , which will surely further promote integrated agricul-tural development of Shandong Province .3.6 The project implementation has built up a lot of backbone

enterprises who combine production with processing and sales , andintegrate trade and industry and agriculture . By way of using theloan from the World Bank to import the advanced equipment , techno-logy and management methods from the foreign countries , the techno-logy and management of *the enterprises have been improved , and theproducts have become more competitive in the local and internationalmarkets with more foreign exchanges earned .3.7 Within the economic life of the project over

Yuan of financial income will be directly generated from the pro-ject , and 14 million people will benefit from the project , withincreased 300 million USD of agricultural output value generatedfrom the project every year . Therefore , remarkable economic andsocial benefits will be achieved under the project .3.8 The project implementation has trained a lot of qualified

personnels who are open-minded and responsible with managerial know-ledge and operational capacity , and they will continue to.play anactive role in their posts . The project will also posively contri-bute to the transformation of Shandong's agriculture from a tradi-tional one to an modern one and the accerleration of integrationof market-oriented agriculture and international economy in ShandongProvince .3.9 According to the real situation of Shandong Province and

the project area , the organizational system has been established tocombine divisions of labour with joint efforts and integrate unifiedmanagement and management by different levels among the planningcommissions , finance bureaus , agriculture bureaus , water resourcesbureaus , aquaculture bureaus , and forestry bureaus under theleadership of the governments at different levels , which practicehas proved not only practical but also effective4. Evaluation of the ProiectProject Sustainability4.1 Good benefits have been initially achieved under the pro-

ject , and along with the project operation , the project willmaximize its benefits , with its facilities kept in good conditionwhich will maily rely on the following facors : a. The productsproduced and processed under the project have a very extensive

-36- ANNEX B

market . China has a large population with small quantity of theagricultural products and by-products on a per capita basis , andaccording to I the well-off I living standard , demand of the agri-cultural products and by-products will be substantially increasedwith great potentiality in the local market . Demand of the agricul-tural products and by-products in the international market will alsobe increasing , and especially shrimp , speciality seafood , chickenmeat and Chinese date products will be in great demand . b. Thebasic facilities like the Yellow River diversion irrigated areaswill be managed according to the plan of operation and maitenanceand they will be kept in normal operation and maximize their bene-fits . According to calculations , economic life of the irrigationcomponent is 25 years , and that of Chinese date ( fruits ) inter-cropped with the grains is 30 years , while that of the others is20 years .Environmental Effects4.2 Based on different raw materials and products the process-

ing components under the project can be divided into feeds , meatsfruits , woolen spinning , and rabbit hide processing .4.3 Feeds processing basically does not produce waste water

with little air pollutants emitted in the production , and althoughthere is some noise pollution , it is not serious according to themonitoring4.4 Through comprehensive treatment of the equipment installed

for treating sewage and removing dust , the pollutants emitted fromthe processing plants under the project can be up to the standardsstipulated by the national environmental protection departments andwill not have harmful effects on the environment4.5 Expansion of irrigated area under the irrigation component

has intensified vertical and horizontal motions of underground waterin the project area , resulting in improvement of the land's qualityin the meantime , attention has been paid to bringing desertifica-tion under control , with trees and other plants planted at headsof the canals , having controlled disasters caused by wind and sandEconomic Evaluation of the Project4.6 Evaluation of the Basic Targets . The project implementa-

tion has brought about great comprehensive benefits for the projectarea . In 1994 , outputs of wheat , corn , soybean , peanut , porkbeef , mutton , chicken and speciality seafood , and income of thefarmers exceeded the basic SAR targets estimated at full develop-ment ; output of rabbit meat accounted for 80% of the estimate ;output of shrimp and internal rate of return have not come up tothe SAR estimates due to the serious shrimp diseases for the twoconsecutive years , and output value of the aquatic products wasincreased by 36.579 million USD , exceeding the SAR estimate by46.3X ( See attached Table 4 ) . The crops production income of thefarmers in the Tuhai project area was increased by 188.5X , exceed-ing the SAR estimate ( 55% ) by 133.5X i income of the farmers inthe Yimeng project area increased by 230% , exceeding the SARestimate ( 115% ) by 115% .4.7 With and without the project . If without the project

the agricultural and rural economy in the project area would alsodevelop , but rate of the development would be much slower thanthat of the development with the project . The project has notonly directly increased unit outputs of the agricultural products

-37- ANNEX B

but also promoted improvement of the production structureincrease of multiple crop index , and rational use of the agricul-tural resources , resulting in raising the comprehensive productioncapacity . In 1994 , use of one million tons of forage grass underthe livestock component , which opportunity cost was almost equiva-lent to zero , provided employment to 100,000 women who were idle in70% of a year i particularly the project has played an importantrole in poverty alleviation of the farmers in the Yimeng Mountainarea , resulting in initially alleviating poverty of 200,000 poorfarming families . The project has also contributed to increasedincome of processing enterprises and finrncial income . In the caseof the transformation of medium and lower yielding croplands in theTuhai River Basin , outputs of the crops per hectare are much morethan those of 1988 without the project output of wheat has beenincreased by 1,390 kg , corn by 1,200 kg , soybean by 695 kg ,cotton by 40 kg , shelled peanut by 800 kg , and vegetables by 6,000kg . The aquaculture component has made 5,066.5 ha of the coastallowlands developed and provided incremental employment to about10,000 people . Based on calculations about an area without theproject , which is similar to the project area , in 1994 income ofa farming family in the Yimeng Mountain project area was 1,483 Yuanand 86.3% more than that of a farming family without the project iwhen the project is at full development in 1997 , income of afarming family under the project can be up to 4,141 Yuan , 128.8%more than that of a farming family without the project . In 1994income of a farming family in the Tuhai project area coming from thecrops production was increased by 980 Yuan and 62.9X more than thatof a farming family without the project ; when the project is atfull development in 1997 , income of a farming family in the projectarea coming from crops production will be up to 3,177 Yuan , 92.5%more than that of a farming family without the project .4.8 Financial Analysis of the Project . Based on calculations

with the exception of very few subcomponents , financial returnrates of most of the subcompoents have been up to or exceeded theSAR estimates . General financial return rate of the project is 29.5%,with 27.7% in the Yimeng component , 39.5%% in Tuhai component , and18.8% in aquaculture component(see attached Table 6).5. Borrower PerformanceDuties of the Depar tments5.1 The organizational system has been established under the

project to combine unified management with management of the govern-ments at different levels . According to the actual requirements ofproject construction , the Provincial Government has defined thefollowing official duties for the departments Involved in the pro-jecta. The Province Project Office is in charge of planning management

of the project , and examining , approving , issuing and reviewingthe project yearly plans ; coordination and service ; foreignaffairs X monitoring , evaluation and supervision of the projectb. The Province Fnance Bureau should take part in the project

management of the PPO , and is in charge of financing management ofthe project , including receiving , on-lending , recovering andrepaying the Bank loan ; raising the counterpart funds of the pro-ject i procurement and supply of goods and materialsc. The project offices of the Province Agriculture Bureau , Fore-

-38- ANNEX B

stry Bureau , Haihe Engineering Commnnd Headquaters ( ECH ) andAquaculture Bureau are in charge of planning , examination , report-ing , implementation management and technical instructions of theproject in their own industriesd. The Province Auditing Bureau is in charge of project auditinge. The Province Environment Protection Bureau is in charge of

monitoring and evaluating environmental effects of the project5.2 The project offices in the project cities and prefectures

are in charge of the project management in their areas , and helpthe provincial departments involved to do the project together withthe technical bureaus in their areas5.3 The county project offices together with the county finance

and agriculture bureaus are in charge of project proposals and fea-sibility study X drawing up yearly plans in their own counties Xmonitoring , evaluation and reporting of the project implementationto the higher leading bodies .5.4 According to the Staff Appraisal Report of the Bank and

the management procedures of the local capital construction , theproject construction units would work out documents of the projectdesigns and submit them to the provincial authorities for examina-tion and approval , and then based on them the construction unitswould work out yearly implementation plans , which would be submittedby the county project offices level by level to the PPO and theprovince technical departments who would review and submit them tothe Bank for approval before November 1 every year , and then theconstruction plans would be made .5.5 Investment of each subcomponent is arranged year by year

according to its progress . The domestic coounterpart funds of theproject are raised and appropriated by the finance bureaus atdifferent levels according to plans , while the loan of the Bankused in bids and procurements was disbursed according to the regula-tions of the Bank .5.6 In the procurements by way of bids , according to documents

of the project designs the construction units would work out theprocurement lists to be examined by the PPO and the province tech-nical departments , who then would submit them to the state autho-rities and the Bank for review . When the World Bank approved thembidding ways would be set , and the PPO would handle the procure-ments with goods and materials procured and delivered to the cons-truction units according to plans .Monitorng_Land Evaluation of the Proiect5.7 The project offices at different levels are in charge of

M & E with special persons appointed to be in charge of the opera-tions. According to daily monitoring and evaluation , the projectoffices in the project cities , prefectures and counties would sub-mit reports of monitoring and evaluation level by level to the PPOand the Province technical departments at the end of a year .Experts from the Chinese Academy of Agricultural Sciences were alsoinvited to assist in the monitoring and evaluation of the projectAssistant Service5.8 The Province Academy of Agricultural Sciences , Sea-

water Mariculture Research Institute , Ocean Aquaculture ResearchInstitute , and the colleges and universities involved have provideda lot of research achievements and put forward many rational propo-sals for the project implementation . Agriculture technical exten-

-39- ANNEX B

sion services have been extensively set up in the project areawhich have provided a lot of technical services for the projectimplementation .Performance of the ProLect Offices and the Government Departments5.9 The project offices and government departments irrvolved

in the project cities , prefectures and counties have played adecisive role in the project implementation . According to contentsof the project construction , they have organized the parties con-cerned effectively in implementation of the project , which haveprovided reliable institutional guarantee for implementation andcompletion of the project on schedule5.10 The PPO and the project offices of the province technical

departments are centre of the project implementation devising theproject progress and coordinating the project implementation , whichinclude organizing the parties concerned to do the project , properlysolving the problems in the project implementation without delay byway of holding coordination meetings of the province departmentsinvolved , organizing field visits and investigation and studytours by the leaders from the project offices , and reporting theproject implementation to the Province Government for making finaldecisions , etc . Regarding the problems to be solved by the WorldBank , the PPO would contact and have discussions with the Bankwithout delay to solve them as soon as possible , resulting in effec-tively promoting smooth implementation of the project6. Performance of the World Bank6.1 The project construction are so extensive and the project

investment is so huge that it would be difficult for Shandong Pro-vince to do the project by itself . The World bank has given usstrong support in fund , imformation , and technical directionsetc , and has played an important role in guaranteeing completionof the project on schedule . The soft loan given to the project bythe World Bank shows that the bank has given preferential treat-ment to the project . The mid-term revision program put forward bythe FM was approved by the Bank without delay , resulting inpromoting smooth implementation of the project6.2 The FAO of the United Nations has given active support to

the project . During the project appraisal , the FAO sent competentofficers to undertake comprehensive investigations , and the factualresults prove the project proposal is correct . The World Bank hasgiven full , strong and effective support to the project , and sentfive supervision missions during the five-year implementation .The PPO and the project staff are impressed with proffessionismseverity and efficiency of the missions sent by the Bank and FAOEvery time when the Missions came to supervise the project , regard-less of hardship and without any rest they would have field visitsof the project sites to review the project implementation , havingdiscussions in detail with the county project offices , constructionworkers and even farmers to get first-hand data about the projectimplementation . The missions would undertake careful study andrepeatedly have discussions with the project offices and staff ofthe project units to find best solutions to the problems in imple-mentation of the project . Generally speaking , directions given bythe bank missions on the technical , economic and organizationalaspects of the implementation are timely , effective and adequateresulting in very good effects .

-40- ANNEXB

6.3 Cooperation between the PPO and the departments involvedand the Bank missions is close and friendly . The Bank missionsfrankly and sincerely put forward proposals to the project officesand helped think of solutions to the problems in the implementationwhile the PPO also talked frankly to the Bank missions about theproblems in the project implementation and coordinated activities ofthe departments at different levels to make joint efforts , and makecomprehensive and careful arrangements about implementation of theproject with a lot of fruitful work done . The successful implemen-tation of the project can largely be attributed to close cooperationand friendly relations between both sides during implementation ofthe project6.4 As a result of some changes of the missions' officers

sent by the Bank to the province for appraisal and supervision ofthe project , particularly several changes of the livestock expertsit was difficult both for them to understand the project implementa-tion and for both sides to understand each other , resulting in somedifficulties on the part of the borrower6.5 From the project negotiations to signing and effective-

ness of the credit , the project was on hold for some time X at thebeginning percentage of expenditure for the civil works was on thelow side , and postponement of revision of the percentage till afterthe mid-term review has-affected the project implementation to someextent7. Future Operations7.1 After the project is in operation the project offices at

different levels will be maintained with their official duty changedto paying attention to the project operation and management includinggiving centralized guidance to the project operation and providinglocal and international market information ; helping the projectunits to import advanced production technology and solve problem ofavailability of working capital i undertaking late stage evaluationand supervision of the project ; urging the departments and unitsinvolved to recover and repay the Bank loan ; coordinating to solvethe problems in the project operation .7.2 Production responsibility system , share holding system

or operating system of specialized households will be adopted incomponents of planting and production , with contractor units ,shareholders or specialized households to be in charge of the produc-tion activities , and maintenance and management of the productionfacilities .7.3 As. independent legal bodies , the agroprocessing plants

will be operated autonomously and responsible for their own profitsand losses by way of self-development and self-discipline , and willundertake production , processing and sales according to local andinternational market situation ; in addition , they will use theforeign experiences for reference to establish trades associations7.4 The PPO will press for the Province Government to issue

document on raising charges for water and water resources as soon aspossible , and further perfect and strictly carry out the rules andregulations on operation and maitenance of the irrigation facilitiesto make the project benefits sustainable . The irrigation areabureaus will be in charge of water supply and operation of the canalsand branch canals , and collection of water charge and development ofthe commercial operations . The village commissions or the benefi-

-41- ANNEX B

ciary farmers will maintain and manage the on-farm works8. Key Lessons Learned8.1 As a result of much time taken in the preliminary pre-

paration of the project , with about 3 years taken from the projectidentification to effectiveness of the credit , great changes hadtaken place especially like revisions of the foreign exchage , andrise of prices of the raw materials and labour , etc , which haveforced the project units to revise the construction programs .8.2 Much time had been taken in the procurement , particu-

larlly in the procurement of the processing equipment due to drawnout procedures . Some procurements like procurement of the meatcattle processing equipment could not keep up with progress of theproject construction , having delayed operation of the cattleslaughterhouses . Some problems were experienced in the procurementwith the coordination between the commercial and technical units andthe project units , resulting in supply of some unsuitable equipmentlike exavators for irrigation and fruits juice processing equipment8.3 During the project identification , estimate of working

capital was not enough , having influenced normal production andoperation of some agroprocessing plants .8.4 Some problems were experienced with timely availability

of the sufficient counterpart funds in some of the project cities ,prefectures and counties , resulting in making the on-farm worksunder the irrigation component unable to be completed on schedule

Table I KEY INDICATORS FOK PROJECT lWl.E)11 rKA'l(01-I -Key implementation indicators in SAR Rev is,d Actual

. QuWn- Total construction Total T*o 0an- 'lull invu:.tw.1 1.1 u. UuK.n- Total investment ToLalUnit tity scope I nvestLtUn i Li.st ITotal 106722 ____ _ _ 117541

luhai River Basin 44806 . 4!l I"L 49422I.Drainage& irrig. 29711 -I 26676 j 26676________________ ___ _. _ ____ . _ _ _ _ _ , _ _ _ _ _. _ _ . _Taochenvpu Scheme I Ijnd improve 7076 1 1 oxpand 523. nd 717 j I N h eanded 7147wo2wo a ~~~~~~~~improve a injiju

_______________ -_ ._ - improvedGuokou Scheme I 1 pnd improve 1540 1 I expand I 4lQ0 hg and 1805 I I 14VIe a 1805WU.5UU ha imprtove I iUU ha 5tnda t2IIJ ne

____ ________ _ .________________ I mproved.Xingjiadu Scheme I I expand and improve 6608 I 1 expand 31, 0 h and 5409 I I i6.0 pro ed anded 540975.400 ha _mprove 2.3 sqa 445 18. __0 ha2.____ improve.d _______ 709

Boqili Scheme I I g%j~ gnd improve 7144 1 I expand 4i,3Qh ad66 I 142.3 3~,egpandc 6176a improve_ii _ _ _ ,__ . , _

hndin Scheme I I mg gnd improve 6876 o 2 2xpand 38 1h0 eand2 5680 1 1 32f86 h3 e panded 5680ntrcroppe hr a improve 4o.IIJU and INNihaimproved ______

Prsigroe Water and I I construct 4,000 sq.h 467 _ 2 Eonstruct 2.130 sq.m 459 1- l 3,010 sq.. buih ding 45930iILntre building area building area -area construcLed2. For-estry 4696_ 7089 7089Chinese date 1 10 Iyelop 50 OQ ha of 2204 I 10 Develop 22. 276 ha of' 2521 I 10 22 276 hQ) of dlate 2521int~~rcropped with Lii ines~~ ddt inter- date ini,erCIp iith Inter h~ gr?j n*grains croped with grains 1ra lns and 212. )2 Lnd 22 5 itspriLts intercropyc( iiiL!qrx-ropp(xI viLl

Lhg HIM e1iai- (k-eIVPmeiu . j ' c vLxlI p_ _ ____ ___________ ___ -_ _ h(~~~~~~nkxVie and ov yieldl I Ire h a r

Fast growin tees I 2 construct 3,000 ha 515 1 2 construct. :3,-000 ha 1 ,10h osrce 1Fuits processing 1I ~ rogesse6.800 tons 1977 I 5 ieoKs 6,800 Lon, 1 5 i I .00te ris 35piiants rusevery Year ___ - __ [ruits every *yeai I___ 3 i)Ccsed every year

Key implementation indicators in SAR kcvislu I ActualItem _ _____

Unit 0u n- Total c1instruction Total liii IuVr I Thud c I *Ji .'o Ii l luniLlOuq- Iotal construetion Total_________________V_ tity scope i invest _ LILy ! I 'v,' tity scope invest

3. Agriculture 563 I I /ii | j 6776Seeds processing 1 12 con--tryq,t 22,430 sq. 648 1 12 corriluct '7 . iThi I 12) 27,385 sq. m build- 758

a. uili*Ing area M. bui_ldi, u ;J._J _ area constructedFertilizer Ion 44500 buy 44,500 T of DAP 4983 Ion 50iO buy 50(,0(J o1' DA OI Ui LtUn 50000 50,000 T DAP bought 60184. Livestock 4768 ,881 8881

____ ____ ___ ____ _ _ __ . - . . . ---- _- r_- ___ ______ ____

Pasture Development I 3 improve 5,333 ha of 129 1 3 improve 3,333 ha of ,144 I 3 ,333 ha, p.tr& 444Pasture a re , cotruc, I improv' anu IuOwiJponJstv~J~hs~i 1 PQn~)ir storge o

green odder |r constructed

Ro,nty Bpeeding I I rear 10hicskets of 237 1 I rer 10,000,sets of 294 Ia l0,000 sets bre,ding 294uhicken ra a br&ed(iln chicKens rx-eedi ng chickens chickens rearea

_~ . ____ __ _ __ _.' _. _ 87 ._.._ County Breeding I I raise 50 heads~ of 37 1 1 raise15 hs of 87 1 1 j55 hwai$ of 4reedi- 87Cattle Farm Ear eing cattle brxing caLttle Ing cattle raised _ Qounty Breeding I I rear 3,030 breeding 212 I 1 rpar 3.030 breeding 204 1 i 3,030 breexling sheep 204Sheep Farm sneep SlC!p rearedHeat Cattle Fatten- I I provide 4 000 fatt- d437 I I provide 4 000 fal.- 482 _ _ 4.000 f§ttened caLt- 482ing Farm ened cattle per year ened cattle per year le providoe per yearFeedmill I 3 process 19,OQO tons 515 1 2 Rrovidu 15,000 Ions 770 I 2 15,000 tions feeds 770feeds, tor chicken , eeds per year provided per year

cattle , and seepper year _ __ _

Nats Processing 1 4 proL 21 at 2156 1 3 proee?ss 75, 000oM 5114 1 3 75, k ttle 5114ant ~ ~ ~ ~ ~~rcEEes caiLL Ie nd 2,4 au,u MA I lion mgats eep 3i,a ,000 meat chic ens per tic ens processedmeat ehicken per year per yearyear______

OeaL Ch-ekeD I I proces million 396 I I proc2es,2 4 million 963 I I 2?. pillion meaL 96rrocessinkg Plant meat ehielkeens per meat c ickens per chicKens processedyear year -,_ per year t_

1-3Key implementation indicators in SAR Kevised Actual

Ie tertln oa nLQ4- Tt- cnLutoeUnit (1u4n- Total construction Total UrniL Qu,n- Total construclion Tolal uni tIOuqn- Total construction Totaltity scope Invest tity scope invest tity scope invesL

Technical Service I 4 iProve 2,500 sq. 171 1 4 I,187sq. o of 185 4 1.Q87 sq. a of 185(entre (buij 7dcrna es of bulding area . building areabasic Yaci lities ofthe centres

Specialized House- 1 3 Suppor, c r I 5 catle 338 2 1 546 cattle and 338holds Support SW and 1 80sheep and sheep Sl; shieep Slls supported

oC?as calDevelopment 46613 47751 47751

1. Shrimp Production 1 3 38739 37202 37202Shrimp Ponds 1 3 construct 5.313 ha 22121 _ 3 c nstryct 4,333 ha 29010 3 4,313 ha of shrimp 29010 oishr imp ponds c shrimp po__S ponds constructedPumping Station 1 3 ping capacity is 2477 I 3 210 cu. a per second 2305 3 210 cu. m per second 2305z9 cu. a per second

Substation I 3 18,000 kva 892 1 3 18,000 kva 557 3 18.000 kva 557

Feedaill 1 3 producn21,000 tons 1422 I 3 prooacq 18,000 tons 1361 3 produ*q 18,000 tons 1361ot leeds per year of feess per year ol teeds per year

Hatchery 1 3 12,000 cubic metres 1537 1 3 12.000 cubic metLres 1506 3 12.000 cubic metres 1506

Cold Store 1 3 2,500 tons per time 1597 1 3 2,500 tons per time 1931 3 2.500 tons p-r time 1931

Technical Service 1 3 jprove 7,710 cu a 953 I 3 7,71Qsq. m of 532 3 7,$S3sq. of 532Centre bIrdIng 8Qre o[ bulding area buaIding areab,Isic acil i ties o0the centres __

Working Capital I 7740 w

1-4 _

Key implementation indicators in SAR Revi u d ActualItem

___ __ __Unit Quan- Total construction Total Unit Iu4n- To;tal curnsiL.ucti,i 1u,I;al unitL Uun- Total construction Totaltity scope invest tIty Scope invest tity scope invest2. SPeciality Sea- I 1 7874 1i0519 10549iood lrroaction |Abolone I 1 67 ha raft produc- 1365 i I 7.QO sq. miinJut,- 1791i I 1 7,000 sq. a indus- 1790tion of abolone tr l producLion of trBial production ofabolone I aDoIoneScallop I 1 530 ha of production 5971 1 1 530 ha of production 7771 I I 530 ha of production 7771area area areaSea cucumber I 1 200 ha of production 393 1 I 200 ha of production 789 I I 200 ha of production 789area area _ areaTechnical service I I l.7N.sq. a of 145 I I I.79Q sq. a of 199 1.TQ.sq. * of 199 0centre building area bulluing area building area LA

Yimeng Livestock 14902 19568 19568Breeding Rabbit Farm I 6 raise 8,000 breeding 1295 1 6 raise 10,800 breed- 1509 I 6 raise 10,800 breed- 1509rabbits ing rabbits ing rabbits

ireeding Chicken I I raise 20,00q.sets of 581 1 2 raise 50,000 sets of 1319 I 2 raise 50,0sets of 1319rars p iiept Dr ing pcrept bredng pare etbcickens chickens chicsns

Breeding Pig Farm I I rqise 120 breeding 71 1 1 rqise 120 breeding 291 I 1 r#ise 120 breeding 291pigs pigs pigs

Breeding Geese Farm I I raise 1,000 breeding 80 1 1 raise 1,000 breedJing 117 1 1 raise 1.000 breeding 117geese geese geese

Heat (hicken Demon- I I fatten 100,O0QO 88 I I fatten 100.,00. 0 152 I 1 fattenr I00, PQo 152stration arm comodity chickens comodity chickens comodity chickensper year per year per year

Feebill (workshop) 1 8 2roqess 69,000 tons 1740 1 6 process 28.000 txns 118'6 I 6 erovess 28,000 tons 1826_eed per year fees per year x ?eegs per year

1-5_

Key implementation indicators in SAR Revised ActualIteom ____ Item Unit Qu§n- Total construction Total Unit Cun- Total construcLion | Total unit Quan- Total construction Totaltity scope invest tity scope l invest tity scope invest

MeL rabbit (gee,se, 6 process 17 mili'on 2726 I 4 process 8 illion !1764 I 4 process 8 million 3764esscken} procrRing meat rabbits and 1.8 eat rabbits , 2 aeat rabbitsmlillion meat geese m _ _ _ _ *Rt on e geese )GiJ . _ _o _geese a ed~~~~ Pr i Pr~~~~~~~~~~~~~~~~~~ONionLcs CTI 2..7i oneHbqt chicken proce- I I Process 2.4 million 639 _ _ proces%2.4 oi IIioi , 975 I I proces- 2.4 milliwl 975

SSiig pmant eat c ickens per meaL c ickens x r 1eat c ickens peryear year _ yearPig processing plant I I process 100,000 pigs 1204 I I process 250,000 pigs W4z9 1 I process 100,000 pigs 1429per year per year per year

Fur processing plant I 3 process 11 3 million 1114 I 2 process 4.? million 1046 1 2 process 11 3 million 1046pieces ol tur per pieces or tur per pieces ol tur peryear _- _ year _ _ _ year

Rabbit woolen mill I 3 prucess 75y tons of 2766 I 2 rss 45Q tons of 3841 1 2 process 75? tons of 3841 41raIt woo en yarn bit woolen yarn rabbit YOO en yarnper year per year pLIr yeareider down process- I I process 450 tons of 593 I I procwcs 450 tons of 1050 I I proces, 450 tons of 1050ing plant raw nair per year raw hair per year raw hair per year

Technical service I 7 i?rovv 13,430 sq o 470 1 7 i vprove 12,UUI sq. 742 I 7 iPprovq 13,430 sq O 742centre t I1dingarea)of tbulding areQl of uIding,ire ) ofbasicfaeiIites of ic facilities of bisicFacil ities ofthe centres the centres the centres

A.1 station I I produce 40,000 doses 39 I I produce 40,000 doses 75 I I produce 40.000 doses 75of semen per year of semen per year of semen per year

,peVcalized house- _ 6 support 30,000 SlIs 1496 _ 6 supporL 29.410 Sl1s 1432 I 6 support 30.000 Slls 1432su port

Technical support 401 _ 800 800

Table 2 Shandong Agr culturai evelopaent Project

Procurement of Machinery . Equipment and Materials2-1 1__ _ _ __ _ _ _ SIR =1.4 USD

Item Unit SAR Mid-term Revision CogplettLd jhe mp- |The co It

a aantity SDR Quantity SDR OuaritiLy S-eR |term revMaterials

1. Building materials . _ - -

Steel ton 11600 3540960 10580 2780445 10580 2780145 79 100Cement ton 44000 1343090 44000 710286 44000 710286 53 100Timber cu.m 38000 6959933 30000 3103236 30000 3103236 45 1002. Production means

Fertilizer ton 44500 9055904 64000 10075051 50000 8145051 90 81Pesticides ton 60 244206 60 244206 _0_ 0 0 O °_ 0Tree samplings I 19600 797763 _ 797763 __. 797763 100 100Breeding stock _ 0 _ 0 0Cattle 1 50 20350 50 20350 50 20350 100 100Sheep 1 3750 381569 3750 381569 3750 381569 100 100Poultry '000 13.5 7418 13.5 7418 13.5 7418 11.00 U0 ____

Rabbit '00 52 21164 52 21164 52 .211G4 I100 100_ ._ __ _ _ _ _. --. .- I-_..-- ._

Polyethylene ton 8600 13126039 8GO0 5606212 8600 560G212 I43 100_ _ __ _ _ ___ _ ____ _ ___ __ _ I . __ _ … Fishneal ton 8400 3760757 21250 7732155 23212 7612155 189 98Mchinery .vehicle and I1. Construction.and 0O&

Hydraulic backhoe 1 5 254381 5 172764 5 1727G 1 68 100 >Excavator ______ _____ ____ __ __

Bulldozer I . 61051 0 O 0

2-2

Itee Unit R_ Hid-term Revision CompletLi4 |iet e)- Th cr IQuantity SDR Quantity SDR Quantity SD- oS tere revise

Dredger . 2 203505 _ _ 0_ 1 0 0Mobile crane - I 61051 .__ _ . 0Slurry pump (50000) 2 0Vehicle 0 0 0

Truck ___ _ __ 0 _ 08 tons/10 tons 1 25/5 518938 0/30 366091 30 366091 _ 0 100Fuel truck , 5 tons 1 3 45789 _ _ ___ 0 0 °_ _ . . |Refrigerating truck - _ _

5 tons I 8 301187 15 195561 15 195561 65 _ _ 00 _8 tons I 1 44771 0 0 0

Chilled truck , 10 tons 1 6 158734 27 960428 _ _ 27 960428 _ 605 _100Livestock eidemic 1 5 52911 0 0 0control vehicle

Ambulance 1 5 61051 5 60147 5 60147 99 100Forklift 1 2 8140 o 0 0 0Hotor cycle/tricycle 1 21 134189 °0 0 0Motor boat . 20 hp I 7 75500 0 0 02. Equipment =____.______0 0 0.( I) Pump ____.0 0 0 _

lectric pu=nin sets set 37 1008977 33 403145 33 403145 40 100shrimp ons_ __ __ __ .__ _ _._

iysej pu nT set s set 0 . 0 0 m250 hp set 16 107451 _0 0 U

2-3

Iten Unit SAR Hid-term Revision Comi elKd edlw ('0 o the conlI QQuantity SDR QuantiLy SDR _ luanriL Cy Si tern revise9

135 hp set 3 16484 A 0 0

ets_ se 7 108 _ _ __ 0 .O _ . ____._Electric pumping sets set 32 84658 0 , In_(irrigation i _ , . l.

1 all ter supply pump- set 161 42593 O 0ing sets______________ __ _ _Tubevell pu pinkg sets set 7 10684 O 0

( 2 ) Electrical _ ° _ 0 0 0

Transmission conductor ton 130 148151 __________0 0 0generator 1 18 274731 It 87283 II 87283 32 100 _Transformer 1 73 742793 40 378320 40 378320 51 100Sub-station switch gear sum 252956 _______ __________ _______ 0 0 03. Office and lab equip- 0 0 0ment _ ____ ____________

Office equipment 0 0 0

Micro-conputer 1 16 162804 12 100000 12 48403 30 48Copying machine 1 5 25438 _ 0 0 0 __ |Offie-/tra nini equip- sum 61051 O 0 Osent t irrigation ) _ ____ _ __ _

Communication/nonitor- sum 101752 0 0 0ing equipment . __________ _. _ _ .

Lab equipment/instrument _ __ U _ 0 0

Agriculture sum 19536 _ ° _ _ livestock sum 34596 0 0 0Agr cul ur su 1536__ ___ _ ___ __ _ .__ __ 0 0 ___ . _ 0. Forestry sun 6716 _ ° _ _ 0 0 WIrrigation sun 305257 O 0O 0

2-4

Iten Unit SAR Hid-term Revision ! tC IIeiI I Ile o- Thefc PeOuantity SDR luantity SOR Uuuitly SiC |IIY S term revi f

___ _ ___ 0 _ . _ _ . I... _ Aquaculture sun 79367 _0 _|_ _ _

4. Processing equipment _0 0Seed processing set 1 49248 11 0,_ OFruits processing set 4 329678 4 976836 4 29976831; 26 100Cold storage equipment __ _ _ __ __ _ _ 0Animal products set 13 1179921 12 482589 12 482589 41 100Shrimp set 4 542137 1 45019 1 45019 8 100Livestock feed processin set 11 555161 6 890840 6 890A40 160 100Shrimp feed processing set 3 195975 3 335296 3 335296 171 100 _Slaughterhouse equipment set 5 508762 4 887058 4 2072861 407 234 oHeat rabbit processing set 6 420034 I 34307 1 34307 8 100Poultry processing set 4 477829 4 994897 4 994897 208 100Rabbit skin processing set 2 218971 i 232849 1 232849 106 100Rabbit hair processing set 5 25540 _ 0 0 0Rabbit wool spinning set 3 3862725 3 3705788 3 3705788 96 100Down processing set 1 210627 1/2301D 679727 1/230f 679727 323 100 _

Poultry incubator equip. set 4 44120 7 665131 7 665131 1508 100Sewage treatment set 10 350018 10 350018 100I eating system for chick set 8 203505 _0 _0 0Other machinery & equip. _ __ 0ri. ctwa I tractor. 1 12 29305 0 O Ohp~~~~~~~~~~~~~~~~~~~~~~~~~~~

2-5

Item Unit SAR Mid-term Revision Comple&tx I he omp- ThS of e t_Quantity SDR QuantiLy SDR _ ulaiititIy SI)R o _AR term revi _

Agri. machinery attach- I 0 0ments _ _____________Trailer l 7 6695 _ 0 iO a_Plow 1 3 1099 0 u 0Drill 1 16 5535 0_ 0. 0Disc Plow I 10 1221 _ _ _ 0 0 0Compactor 1 2 895 _0 1 0

Hay shredder 1 24 2931 ___ ___ - 0 0-Grass cutter 1 63 6410 0 0 0Fertilizer broadcaster 1 4 735 |0 - - 0Gates c/w hoist 1 468 95240 ___ ___ _ 0 0 0Boiler 1 45 659355 24 370240 24 370240 56 100Prudent shopping 9065811 9615811 106Total base cost _ _ 54260000 54260000 53760000 99 99

Table 3 1hinaSharKbrg Agr icluitudl DOI I xvoIiiut IPro.iwc.

3-1 Trnainirg ard L-diidl h%isurIt!

Tota .ti [ __. b. . _ ._. Y._rItem / subjects KMn-, i$uJJ uiw __ _ Cbnumt and locaLi(nsK)fths 1989 1990 199W 1992 I993 WIM

I Ovaseas st tOas _ ____..

a. Spity seadx prcessing 2.5 48.50 2.5 (ie rp of 5 pasos to Jwun

b. Poultry breing / raisine 2 13.57 2 (he grou of 5 nx scns to France_ _ __ _.._ .__ .... ._ ._ ...._... .....

.._ .._. ...............

._ ..._ ._ __- t'

c. Livestndc produts proussine 2.5 17.87 2.5 (ne grWup of 5 u to lnmAr

d. HiJr equipient sure / assesment 5 18.98 2.5 2.5 Om eoup of 5 pwsons to IIllnd I a- .revicw-ine ivesto,k Ira4zts PrsinrE ipent9we groyp ot3 pw§ons WV or review-_____,_____.______________. Ing srimp prssing equipwnt

e. Ibrket survey for agricultural 2.5 17.22 2.5 (Oe gr4o of 5 pascm to G e-rwprouc tsf. Airid a semi-arid areas irrigation 6 47.59 3.5 2.5 (kF grow o prsm to INAtochniques , etc. omc group ofb pers, to k land .

g. Bef, djkenApaork padcing, 2.5 25.00 2.5 One group of 5 pr s to Australiaard retal irn e iq_eSub-total 23__ 23 188.73 ___ 10.5 5 7.5 - - --

2. Overseas training _ _ ____ _____

a. Agriculture and livestock traininr 17 115.(0X 17 - ne grou Qf ralia for.train ,tic on weicul ie an IVat prailetio.________________________________._ . orcssing and s3rEgeant tani quasSub-total 17 115.00 17 ' I s have beem revised a pproved byI L . _ ._ _. d iinik___ _ _ _

3-2

Item / subjects 9W1 a _ _ _ _ . _Content and locatiox.mnths 1989 19_ 1991 1992 1903 IAJI

3. Local training and study tLxrs

a. Shrisp raising teemiques 206U 150.24 29 203 721 832 275 .Jen-ty diratLon t"ining corLe on triur mis-*In.IOC ' '2 an larvae cu Iture fo ct.0lc.r Liff,i in total

b. F ipi speciality seafoods raising 770 47.36 40 305 159 135 91 40 Teo-day training course on raisirig, sql cul-________ __o turuarld ErocpssnlQg ts3sin. Iq ot secil dity

c. Seed breeding ard qualitY control 94 44.38 30 34 30 7-diy traini (otI.bf o sa .Jrxing tetsoYlrco nttonhpe -cias nd esnstdtrs r n operatjon o Un

d. Seed processing 10 2.38 2 3 5 12-day trainin& course t' of the seprocWs, I equ Moet andse qLr IY conLrolMl ce for man-tioe in totarn .

e. Livestock breeding and raising 775 105.00 100 125 150 200 a2o I[-dYtrajniau cowse for technicians 9f tech-nIcIervIoje . (Qodcra t

f. l,ivestock prxodcts / feed proess- 320 49.60 60 100 100 60 15da 1'in' f tadmiciar* of theIng~~~~~~~~~~~~~~~~~~~~~ u2fe in the proec' ar .ola

g. Project iwplerentation anid ange- 100 41.77 100 . Ag l rcm tIru *bi pl o.nt prt f tJn , ,naiaes .

_ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ __ _ __ __ _A ~ .o tr . Total _O min-tix .L

w

3-3

Iteo subjects _an Thi lY_ _ w _ Skt w dl.iodL

h1. ft iculuilUl U-mov MgCnt 30 1 I.tJO 3o1 wxxipy of, IQ sxsx!/rxg) Losti kli , w tIf JI Z"u, J i , CH"esWiV, VIkl in?"

i. I'xreSt Ifruit trees culLivatiCn 7:180 140.60 978 978 M;1 9G2 RA9 3%i 1 I-tlay t4aiiingM g" t n planSting KWO it(}ISiX t AY191 PIA Unl, ete 1

. *~~~~~~~~~~~~~~~~~t111xqudta-S in UI. p-ilitt el a .O PTO'L 1.176

j. IFuils waesin8 64 20.00 19 45 15-t)1 4aining IU'se T taimQlosis;a MprssQl 1 I(it,%ff nIcx,(viI% i I itUrtn 01- eFippmt.

Ah ntpnicl(l; 1rt. tle Irult - prax_>Silig

k.fulit3`11q)UL(V UlAillilig (iO 27.81 .50 ID g)-Aty V-ii¢)Uire sxxlts .4 w>f# inityujil

1. IrrigaLicn area O & H toxdniques 60 G4.91 15 15 '30 1?-ki tr4inina ax"s on irrilguLion ,wwal Ion: KlntfsMN. wun w6na(ML . oLbtalu

50 76.47 20 20 10 158 kw knil,i11 cwe ot >LMiuifpt LdXi@yn. Vaerreure useiti otiimization I VLtt -a' V

n. 13usiness acdrinistraLiat a mnd iene- 6D 10M0 30 :11 15-(hy Ira nire c s ain w"t 1 al lr Ws lIsll I OneLg Wsf;

o. Gergrdl liv(iAd sa-vi(xs Lwxl 2m 159.5 m. go go 0>t Ietilki(M axnui r xIIIina t.saxttsesleJn _ _ _._ . ._ _ _. .__ _ _ _ . _ . ~~~~~~~~~"tilk.d.1 willey.X^,T 1i L>llI (XIAVk;il It lvklxA

p. Trainiln5 yy et La ow 78 81;.89S 78 hlit;kurillitr YantJ. (^it . , ruLtiiii xv-W

WaI, ol aqratic ProdicLts 1,<48D I)til y)S ol agLic 141AVUl lir ProJect staf-f.

Sutotatl 12140 1070.43 1247 1?'9B 4482 2 B 17:6i 5D45

Total of training aid stuly tas 12180 1374.16 1247 1798 4492.5 IF33 %. a5 .955

-55- ANNEX B

Table 4 Benefits Achieved in the Project Area

Increased Output ! ProceesingCompared with 1988

% ofItem Quantity Estimated Item Quantity

('000 T) indicatorsiI ( tonl__ _ _ _ _ _ in SAR I_ _

Wheat 278. 189X | Beverage 32860

Corn 220 | 141| Eider Down 437

Soybean 27 147% j Woolen Product 22Vegetable i 306 1 4663% Rabbit Hide 4,100.000

pieces

Shelled 1 19.4 X 1760X t Rabbit Wollen 309peanut _ i ___ Yarn ;

Ginned 3 8. 3 Fur Products 410,000 piecescotton I ! _

Fruits 24.3 _ | Down Products 154,000 pieces

Herbage 79.4 1 - I fruits 728

Shrimp 4.532 I 52l Fruits Juice 2688_____ .___ i____ land beverage

Specialty 1 23.82 149% Aquatic Produ. 7920Seafood I __!_!

Rabbit 8.908 89.8meat j . l ;

Chicken 10.7 . Grand total increase

Beef 20 360 '. Timber 1 5000 cu. m

Pork 23.3 291.3 ,

Based on comprehensive average prices , there have beenincreased product value of 5,334.000.000 Yuan and increasedProfit and tax of 724.000,000 Yuan generated from the projectof which . there are 663.000.000 Yuan of profit

Table 5. Benefits of Farmersin the Project Area

Net Income on a per capita basisp PrGject Area : Before the 1994 Increased

Project (Yuan ((Yuan) ( Yuan %

Farmers in the EightYimeng Counties 329 1154 825 250

Poor Farming Familie I iin the 20 Yimeng 250 I 691 441 176Counties

Grains Production of 306 67.4the Farmers in theTuhai River Basin ____,

-56 - ANNEX B

Table 6 Finamncial Ar.lysis Table on Shmdxs Agriculbze Developmt Project

FRR ( NPV12%,zillion Y)Estimated ktual FstiBtd k-tl

I.Agricultwe ard Irrigation Covaents 36.2 1328.742. Fast Grving: Trees . 34.7 21.633.Cinese Date ( Fruits ) Intercrped with Grains 42.4 566.264. Storae of green foddr fcr ammiatiao 74.4 8.445. Pashzre Development 44.8 33.506. Tuhai Breeding Sl-p Farms 13 114.7 O.Q8 0.397. Tuhai Breeding Chicken Fans | 23.7 | 13.158. Tuhai Breeding Cattle Farm 15 15.6 0.07 0.269. Tuhai Mmt Cattle Fattening Fawms _ 28 24.4 3.67 5.5910. Fruits Processing 1 17.9 j _ 12.0511. Tuhi Hat Cattle Prcxessirm !32.0 _ 86._1112. Tuhai Heat Chicken Processirng _ 22.2 ! |14.81

13. Tuhai Feeds Prxxcessing _ _ 33.8 17.66

14. Yimeng ( County ) Breeding Rabbit Farms 2 .9 T° 33 i3.74

15. Yimen Townrriip Breeding Rabbit Farms 23 21.3 10.12 2.32

16. Yimenr Breeding Chidcen Farms 21 23.0 3.63 19.93

17.Yi mg Breeding Geese Farms 23 24.5 1 0.26 11.17

18. Yimen Breeding Pig Farms 118 :13.2 10.24 0.30

19. Yimen Pig PRocessing Plants 32.6 j 65.75

20 Yimeng Eider Down Processing 33.5 13.23

21 Yimes Woolen Hi ills ! 18.2 15.41

Zx Yimeng Mat Chicken Processing Plants i30.1 40.11

23. Yimeng Rabbit Hide Processing Plants L _ 1 36.6 15.03

24. Yimeng Heat Rabbit Prxoessing Plants 134.8 _68.59

25. Yime_ feeds PocessngI 28.2 1 j_21.25

2£. Shrimp -o Prtion 18.6 15.5 j115.00 91.66

27. Specialty seafood prodacticn , _ , 26.6 i 1175.64Tuhai coporment T i_35.9 2 ! 279.60Yimng cwaoret Z 127.7 1 255.16

Hariculure component _ 18.8 26.61The project as a whole 29.5 12571.42

I MAGINC'

Report No: 15306Type: ICR

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