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A1.,t1/PAAC/98/01Language: EnglishO riginal: EnglishDistribution: Lim ited

CO N FIDENTIAL

EAELOP&D C'zvxt ?'

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APPM SAL REPO RT

H O R TICU LTURE A N D FO O D CR OPS D EV ELO PIG N T PR O R C T

REPUBLIC O F M ALAW I

The present Report is m ade available only to staff m embers to whose w ork it relates.M y further release m ust be authorized by the Vice-president for Operations.

. . ' . . . . . '

* ' .

COUNTRY DEPARTMXNTSOUTH REG ION

SCCD: N.A.

O CDSOCTOBER 1998

y z A. . ù&!'à &, 'cl'. . v A1' * TABLE OF CONTENV S

Basic Data Sheet, Cun-ency and M easures, List of Abbreviations,List of Tables and Almexes, Project Infonnation Sheet,Sum mary and Reconunendations.

Project Matrix

INTRODUCTIbN A,N'D BACKGROUND

Paee

1.

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2. THE AGRICULTURAL SECTOR

THE IRRIGATION. HORTICULTURE AND FOOD CROPS SG SECTOR3.

THE PROJECT

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PR wCT P .'IPLES' N AT1 N , , 'l'at. . ,..': , !''1 ..:

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' 6 1 lre' ch nical Justiflcatl-on ................,..... ...... ....... ...... .... ............ .... 2 6' J',';'. j . ; tL 6 2 l7r,oject Ilenef-lts ........................,.................-............................,...... 26 .'.t..* j . . . .' . . :6 3 Financial and Fronom ic Justifloation. ' ' 27 ' ' . '

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1 ,1 .' ds'td * ' ' I7 . 1 C701 ncluslons . . . . . . . . . . . . . . . . . . - . 25 '. ''7 2 ' 17 (zornrn1- ent (zapaci' .............................-..........................e...... 28 ..,-k,7 3 R 'eco en tions and Conditions .f' o. r -. an' Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 '- -' '* j ,

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j , . '. ls Appralsal Report was prepared by . r . S . 1 Z'' . . o u-s. us. g, P clpal ' culjtu . .ra- 1 ono' m lst .,.

. . ' . ' l't# : . * t'ssion 1 nader) s. . glow Senior Agron'o m, : i:st ,' 'essrs ,J. ' ., , n,' edfio Comul. .tant -'1 , . ... w, . , ?; . ..w . pa . . a!:- . .. . . ' .. ) r . .. ptvyk .#' , .

' ' . . . . .. > .,. . .: t ., 1 ' . ..kCi vil/lrngatlon Engmeer

, F . . . bert, C0- rls- uk i.lvtt'n. ,',nz.t? ;. ' C r . lt. E . x, . , ..,rt an d,' V . Jogoo , . ,;',j . . .. . . . . z -. .' . .,j tt .-:;1 ' . '- J T;L' :, - ' . ' Jt.' y . . . . . . tlEnvtk o entali st

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on this report.sho. ulld addressed to r. . Tnpath. y, , n'n. .aM. er, OC : S .2 xt. 4. 162) an d r. .i1 '*' *'

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= <k' t'x wtl', .LQ ' .. ' 4 b 'u.' ' .* '' Wk:dkaau 2r*' k. r.x yb.&a'v . .a...:r L .>= u' è : '+<f.. ur i .< t '.. . z u: . >

r 'r. . T , f > : . . >

A . G E N-E RA LArea (Sq Km '000)Populalion size (in million)Stx R:tlio ( 100 fem:tlz)Population ulltlcr fif:ccn l'cars ( %)Populalioll .sixty-five years and over ( %)Dependency ratioUrban Populatiun %Rural Population (%)Population Densily (per kn)2)Population per sq. km of arable landAdull Lileracy rate (Tota1

- Male- Fenlale

Labour Force Panicipation Rate ( %) Agric.- Male- Fcmale

GNP per habitant (USD)Annual growth rate of GNP (%)

B. DEM OGRAPHIC INY ICATORS

Annual population growl.h ( %)* 1992Urban population grow'lh rate (% ) 1 992Cnlde deal rate (per 1000 popuiation) 1995Infant morlality rate (per 1000 live birth) 1995 'Child monnlity mte (/1000 child age 1 - 4) 1995Maternal mortalily I'ate (/100.0X 1 .birthl 1 995Life expectancy at birth (yeal's) - Toml 1995

- Male 1992- Female 1 992

Crude birth rate (per 1000 pop.) l 995Total fenility rate (No of children) 1995M edian age 1995Population doubling time (years) 1990Women of child bearing age ( % of all women) 1991Proporlion of women using contraceptive (%) 1993

C. I'IEALTH & ITIONAL INDICATORS

BASIC D.ATA S f I EET

DESIOGRAPHIC AN 'D SOCIO-ECONOSII C INDI CATO RSCom narative IndicatorsDevelo-pi ng ,

Year AIALAM'I Africa Countries1996 1 18 30.305 -1996 1 l .37 651 .4.5871 995 98 99 1 C,41994 48 45 35.61 994 4 3 51990 l04 92.3 671 995 13.50 34 371 990 87 66 . 63

. 1995 82 21 ' 511985 304 363 -1995 56.4 53 701 995 -' 63 751995 k2 42 62

19961994!9961993

70.3855180-1.2

359872.9

231952.2

3.16.920.5013221562044.804545.8050.407.0517204513

2.751 51071 6763052

6-217.3244518

2.l3.89.06891480

293.522.234

53

0 .40.89.01 31 63075

1 51 . 733.6148

72

Population per physicianPopulation per nursing personsAccess to safe waterPercenmge of fully ipununized childrenAverage per capiu calorie inmkeBabies born with birth weight< 25X gm ( %)Pemenuge of GNP spent on healthAverage per capim spending on health (USD)

D. EDUCATION INY ICATORS

19901990199519951990

199019901990

270001400054982049

20511

18000

*. *

2328

7000170070852546

1 94 .04 1

39018O

873412

7l 41958

Gross enrolment ratio :- Primary School Total 1994 120 . 79 93 - -

...' '

.J tema:le --.. -.' y.-. . '-. 1994 .- c')-.. --.:' 1 14. - .-

' - . - . 63 - 2 .:- . -.4.292 -.: . -u. z) a. 10/.... . . ' -. .:- . .i=.:--- - .

r.-* ':(;J -..2 ' u.E.=j' - 7 '.j- 1.Ja=.- j-jgj j- -y.o.ùj-= -r='a.w- . - 2q17: - - :Lr . .z - - J 272.:- -. --1. . 2c1-.1 .' '-=:. - L .' ' - - .-': .; .' . .L- -- .=-X. . --u - : .:-LG2n -. .-z-. - ...... .j-.--- L:-'/'L .Jl-- ..r .=. :..-. ..m - Fioh ar.i S 1994 $ 58 70 9Female 1994 6 21 40 96

Percenmge of GDP spent on education 1991 3.4 12 10 4Average per capi!a spending on education -

Source : - African Development Bank - Selected Smtistics on African Countries. 1998.- W orld Demogmphic Estimates and Prospece. UN, 1988.- n e Smte of W orld Population 1991 . UNFPA- Africa Recovery No.3. 1991 , UN- n e World Health Repon, 1996- W orld Bank Developmenl Repon, 1993- La simation des enfane dans le monde/UNICEF 1996- n e World Heaith Repon, W110 1996- Human Development Reporl. UNDP 1995

Noles : * Natural rate of increase onlyo e le M

CIJRRENCY ANb M EASURES

Cul-rency Eguivalegts(As of August 199.8)

Currency Unit =UA 1 =M W K IUA 1

, M ûlawi Kwacha' k .

g : . ' 3 5 . 5 1 8 4u tx; . y () . (; g j kjy 5 ,.$4gyp j gzugg

. . ' .

W eights and M easltres

1 Metric Ton (mt)1 Kilogram (kg) =1 Metre (m) =1 Kilometre (km) =.' .1 Hectare (ha) =

2,2œ lbs (pounds)2.y2 lbs (pounds)i 3 28 f4 (feètj ';: '!r''

.0.62 rn'iles2.471 acres

FISCAL YEAX

July 1 - June 30

ADB African Development BankADD : Aglicultural Developm ent D ivisionADF : African Developlnent FundALDSAP : Agriculture and Livestock Developlnent Strategy and Action PlanAM INA : African Development Fund for M icro-Finance Investm ent for AfricaA M TA Agriculttlral M anagement Trairling for Africaam sl : above mean sea levelBCA : Bunda College of A griculture of the University of M alaw iCCs Collection Centers 'CM B Central M arketing BoardDARTS : Departm ent of Agricultul'al Research and Technical SefvicesDO1 Department of IlnigationDOCP Department of Crop ProductionEM A : Environment M anagement ActEPA : Exteasion Planning A reaFcs Fanner ClubsFI..S Front Line StaffFGI-S : Farmer Group leadersGOM : Government of M alaWiHDP : Horticulture and Food Crops Development ProjectITF 2 Inigation Task ForceJICA : Japanese lnternational Collaboration Agency1.M 'B : Local M arketing BoardM ASIP : M alawi Agriculmre Sector Investment ProgranuneM EPC : M alawi Export Promotion CouncilM F1 : M icro-Finnnce Interm ediaryM K : M alawi KwachaM OM : M inistry of Agliculture and IrligationM USCCO : M alaw i Union of Savings and Credit Coopem tivesNBM : National Bank of M alawiNEAP : National Environment Action PlanNEP : National Environment PolicyNV AD S : National lnigation Policy and Development StrategyNTRC : Natural Resource C ollegePM O : Project Mànagemepy OfficePm s : Pro e M nnngersPRA : Pm icipatory Rural Appraisali

I s - . .a,?Y ... -.. : Project Y- ea.r . .. -.s... : ... . . r. . , . . . . . . . . . . r - . . .-.::. ..

.. ... .: .;z -..: . .:-

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SCCBU : Saving and Credit Community Based (self-owned) UaiorksShm : Srnallholder Inigation ProjectUA : Unit of AccountNrDc Village Developm ent Comm itteeW AB : W ater M sociation BondW FP : W orld Food Programm eW PS : W om an Program Section

LIST OF ABBREVIATIONS

a v . .w x ... px . . . . .V ! * X XX XCM . . . . x= xr . . . . mvew a -v '' ' e . u % . ' .u . x c'. .' ' .. ' , ! N. . p .: .. J . . -e . j . ;PW . x ' . .''' . .. .rV#PM1F7 x; y a

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LIST O F TABLES. *1:1: Jjjj. '+:

b Title Pao.e :?btlrrl er - j' . yt

4 . 1 Su a, of Proj ect Cost Estlrn- ate' s by. Co rapone. nt . . . . . . . . . . . . . . . . . . . . . - . - . - . . . . - . . . . . . . . 1 6 qn.'. . :.4k ç' 'j

. ' * . .;4.2 Su a of Prolect Cost by Catego .% of. Expondlture . ... . . . . . . 17 .- )..>. ,' !

I . .m ' ';

4 3 S ources of 17 Ln- ance .....................................................-...................... 1 -1 '..k&'z<4

5. 1 lnrocllre, rnent angernents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 ,..<...' xj1.k..

''

5.2 Ex nditure Schedule by Colnponent . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . 23 -. ',-'

Q. . T .' ;. & ..j

5.3 Expenditure Schedule by Source of Finance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 ...-?-.,4i .', * .

i. . . ' .

.. A'7 j, ')

(1:---11: t!i;k '71iq' (15::- ' '. : - E-- ?' .- -$F.-wq -- . ' .,tr

. 7

Num r Title . o . of Pao-e. s . ..j

x 1 ap of alawl- - lDroject ea . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 '- -'e . .

CX' 1(B . lDrol- e Ct ea and 'FaroGeted 17 ers . . . .. ; . . . e . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 . . '.. ..11'

x

. oj s j. -,4

3 Prov'isional List of o s and Services 1 ''''CX .';' j

- -..)CX 4 . 'Tenta. tive lrnplernentntion Schedule . . . . . . . . . . . ..a. . . . . . . . . . . - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - . . 1 ' - ';);

- B doet - . .- .. .. - . . ' - . ' -- . . . '- 1..- . . a- .: -. ...L 'a. -''A S Z C X i .' -. ' ' ' ' C' F O (I7 ' . 13 F kl C t 1 0. F1 11. . . . . . . . . . . . . . . . . . . . . . . . . . . . .- . . . . . .. . . : .. . . . .. .. . . . . . . . . . . . . . ..- .. . . . . .. ' . . .. . . . . . ....... . . . . . .. .. a. ,. . . . . - . .. y. .,y. , .. e.-. . . o.. . . .. -- - .- . - -. . - - ' - .. - -. - . ' --- -- - -- .-- -- . -.-.. .. . -.- - -. .-= --. .- ... . . . ag- .- . .. iw . . Q>. - v.- . .- -- . - .. .- . - * - - wc- J . - r ... , .' r . . ' ' * . . ' z . - ..1' * '' . . . ' *' .. ' * ' ' . . ' ' ' bn :n. ' . ' ..u=' = .-' '' r - . < -*'. rJ.- - ' .-u= . ... . Lr .... . m w. ...=x ..-.Ce .*.T...u-.'r..T ..a e ....Q - ..='.- . ===. z. ..x.....*.> =* v tv,,- vz*.'t.%.*bp 'n nz - c. .= = .- J. . . J= == œ = .- :c ' :.

ex 6 onornic Inte l te of Retur.n (E .' ) . .'.. . ... . . . . - . . . . . . . . . . . . . . . . . - 2 ' 'i' ' ,'''zj: . >..!..,.$.,jjj ..ji

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... . . . . ' r. '. r %rr.. Kr5,=- v Trr ' 7 . .. - -- . .. , . , vy. , . . , ... . ,pI v !

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.-k '8. SOURCFA F FINAN CE ' .

.XDF : UA 6 . 23 ln il)' ljon . fï..T.A.F - UA 1 .26 niiflibetR '' . '. ) ',-Governm ent Contribution : UA 1.œ m illion ' ': .k

. i -. jBeneficiaries Contlibutipn : UA. .0.60 m illion . ' k

. . -.

j w. . . . . . . .tjDonor. Conktlibution : UA 0.58 million ' j. ,

' . . ;;TOTAL CUST : UA 9.67 millio'ri . '.'

. ' .

' k.

. . *

9. DATE OF H PROVAL : December 19 98 '' ,%

j , . . . , . -- . dj;-,-, .., ;10. F-qTIM ATED STARTING . ,' ''.t /

. l . N-' 'v 6$! .DATE OF PROJECT : M arch 1999 y $<.'

. '''

gyl . - .11. PROJECT D TION : Five years zt','

l . . , ujaajwetj yy oe. . '

..

,...7..,,12. PROCUREM ENT : Prolect good j, wprks and sen/ices to t)e

. ..

yFund will bè ...:r.oc. 'ured âccord 1,13, g td' the ADF Rkles énd ' , .Procedures fet, orœ uremofi't usinz the Fund's Standard k>

. . *. . *'''' A :

Bidding Docum vùLs. .13. CONSULTANCY SERVICF-S

. l AREOUIRED AND STAGE OF SELECTION : k?

i '' i ''A project manager and an accountant will be reqqired for fim yenrq each. A marketing t .:

specialist/expert. and an accountnnt will be recnu ited, for 'tlu'' t.e years each to manage the t. '

. : .

.tnarketing strucmre component. Two Civil E.ngineèlrs with exlperience itl M gation, an ',environmenulist and a Participatory Rural Apprâisal (P. RA,) slle cialist ::,111 l>e rdcruited for L -,

. . '

. h - ' ' .

.. ),' v1@b*.tralnlng in the use of the survey and soil equip. m eht, gutietvisiôn of the civil worpvs design, c'tI , , . e jn jyjarketin. g techni'ques ' ye.m onitoring of environmental m itigative m easufès, a'rd. tl-alncling .

.. . r?respectively. A number of short-tenn consulun? wi'l1 be required for tbe irligation and y!marketing civtl works. In addition, short term consultnnts will be rekuired for marketing studies 'J'.'l

' .' istant wul h-,. recruited.: througia ' ' .. ' '' ''

and environmental lm oact assessm ent smdies. 0th. er techynl,cal ass ,1 *' . . . 2 ' ' !

the NGOs and the M FI for tralnlnc in credit mariagemëeznt. Audit szrvices will also be yrocured .I h'''- < ' ' .

. . . .ttllrough Short Listing. Selection process will commence as sooh as. the Board approves the 10=. J.,

. ' ,:- . 'Lt

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SUNIM ARY, CONCLUSION AND RECOAfNFENY ATIONS

I.BORRO W ER

Z.EXV CUTfNG AGENCY

3.ADF LOAN

TERM S

Duration

ii) Service Charge

iii) Cornmitment Charge

: Government of M alawi

: Ministly of Agriculttlre and lrrigation (M 0A1)

: Not exceeding UA 6.23 M illion

: Fifty (50) years including a grace period of 10 years.

: 0.75% per annum on amounts disbursed and outstanding.

: 0.5% on the undisbursed portion of the loan, 120 days aftersignature of the loan Agreem ent.

: 1% of principal loan amount payable armually from the'

eleventh (11th) year after the signing of the LoanAgreement tluough the twentieth (20th) year and 3%per almum thereafler.

: Not exceeding UA 1.26 million

iv) Repayment

GRANTADF/TAF

4.PURPOSE OF 'lqIE LOAN AAY GRANT

n e ADF Loan will fmance 76% of the foreign exchange costs amounting to UA 4.34million and also part of the local cost of the project. This will nmount to UA 1.89 or 20% oftotal project cost. The grant will fmance capacity building and training of project staff.

5.THE PROJECT

a) (lbiective

n e sector goal is to hnprove the well being of M alawiars tttrough poveny alleviation,especially among m ral people, by prom oting broad based and acceleratM agriculturaldevelopment. Specitkally, the objective is to contribute to food seculity by increasingagriculture productivity and farm income of the sm allholder target g'roup through better access

: to smallrscale.irrigation, horticulmre >nd markqting developmqnt. . .. . . ..: -;..-.:.r .. ..

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b) Description

To achieve the above objective, the project design has tnken into consideration five maincomponeni. n ese are: i) Capacity Building of the following depardnenz: Irrigation, CropProduction and Research of M inistry of Agricûlture and Irrigation; ii) Establishment of aMicro-Finance Credit System', iii) Establishment of Small-scale Irrigation Schemes', iv)Establislmnent of a Marketing Stzucmre; and v) Project Mnnngement Office.

(ii)

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6.PROJE CT CO.ST '. .

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'T'he total cost of the project including physical and'.pric. e contingencies is estimated at UA. +(' ' . . . L''9 .67 m illion. 'lhe ftlreign exchange component is UA 3.:75 m iliion i.e. 59 % of the tota l pro-fect .

' h in 'the table' .' be' low . icost. A summary of the prolect cost is s own' R v . .!J.'k

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. Stmunary of Prolect Cost Est im atqs by Com ponent 'j. .

' 5, 1. - $- .p.. j . . . y;jCorhponents (ln MK Million) (ln UA M'illion) % F.E' . '. ' yt'' . ' . . ' ' ' ' ' . 'U .r . . .. . yF

oreign Local ' Tool Fbreign Local Total '... ..'' . . 'i'. .'jExchange costs dosts Exchangè eoss costs ,,

I . ' q. !. . r !

A. Capacity Building and Training 45.82 1 7.40 63. .22 1 .29 0.49 l .78 72.6* ...j.B. Rural M icro-Finance System 57. 19 24. l 5' t 8 1 .34 1 .6 1 0.6.8 2 .29 . 70.3 '. ' . t;

; . ' l ' . o!C. rsmall-scale Irrigation. Schemes 40.49 36.23 ' 7.6.72 1 .l4 l .02 2. 16 52.9 . .,

.! : ' :' -'i D. Esmblishment of a Marketing Srructure 28.06 17.k' '(j ' 45.46 ' 0.79 0.49 1.28 61.6. ..

-. ..).k.l r:-. project Managemcnt l 10.66 29.13 3..,.7. 9 o-3o o.82 1.12 27.3 ' -' .'. t.. -!

' ,. . ' : . ' IL *''j . Total Base Cost 1. 82 .22 124 .13 i 3. 0, 6 .53 5. 1 3 3.50 8 .63I Physical Contingency 10.30 6.715 ' . l 7 .05 0.29 0.19 0.48 . '

Price Contingency 1 1 .72 8. 14 ''.' 1;9.89 0.33 0.23 0.56 *.:...-*-1. . .

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jj.,rTotal Project Cost 1 204 .24 1 3'9,13 343:,47 5.75 ' 3.92 9.67 60.0 ' :r. 'Jj. ,. ., ; .

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7. 6 Y- - O. V PROJECT COST BY CA ' G' ORY ' OF E' E' NTD .

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. .r y;.jThe total prolect cost by categol'y of expenditure is slzm': mi nn. zed in the table M low: ' r..

- ;. . . pjSllmm of Projed Cost by Categco of Expenditure '.

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* .. . . , :%' f Explenditure (In MK M' illion) (In UA M illion) % k ' ' 'categôry o

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Foreign Local ' Total Foreirgn LOCaI Total ::.1 i. ''''' % .:' . I

Exchange Costs' , G''osts Exchafl. ce Costs, Costs vtj'!. ' ' L -$.: #' *--e J ' ..

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1 . Goods and Equipme 'rg 19.89 4.26 .24: 15 0.56 0.12 0.68. ' 82 . ? . Rj2. Credit for Gdods'& Equipment 46.53 10.30 56) 83 1 .31 .0.29 1.60 8.2 ' '' ' . ' . ''

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. . q%'3. Civil W orks - . 46.53 17 .05 63- ..58 f .3 1 0.48 1 .79 , ' 73 'b'.

- . . ' ' '

4. Training and Studies 13.85 9.23 2.3k.08 0.39 0.26 . 0.65 60 ,- . 5- Technical 'Assistance tl.-ocall - ' ... ' . . . . :.D.'' 0 .00 ' ' .-z' 4 r62u-. .:'-- 4 .62 -.' '. - '.0 .00 -=.

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. . 1 . r '8'. Operation & M aintenance 22.03 9.59 31 .62 0.62 0.27 0.89 70 , l i9. Goyep ment 0.00 31.97 31 .:9. 7 0.00 0.X 0.90 CO :. : . j . y , , :. t ,10

. Benefi.ciaries 0.00 19.1'8 19. 18 0-00 0-54- 0.54 00 'kù;. . .. J' l . : jz.. . r . , a. . ..Total B asç C Qst ' j . 1 8 2 .22 1 24 . 3, ..1 $ . 3.,0,.,6. .. 5 3.. .. . '. . 5 . 1 3. . . , . 3 :o: 0: . .. . . 8 ...6 3. : . . . , .

. . . ,. j.. . . . . ;. . -j! . . . . . .. . iPhysical Contingency 10.30 6.75 17..0 5 0.29 0z 19 ,0.48 . ..

. . . 'tJ . .:.. Price Contingency 1 1 .72 8. t7 ' . 1.9 89 0.33 0.,23' 0.5. 6. . '' .. . . . .. 1:,..ky.. . . . , . , j . r,j

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j og , N cy , o-s , . .. . .)Total lh-o.l ect Cost ) 204 .24 139 .'2. /. 343.47 5.75 3- . . , . , ,.. v . ' ' * v

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8.SOlm CES OF FLNANCE

T-he fi nanci al pla n of the prcject 1 s sunlluari zed 1- n the C, ol l-ov,rl- nc table -.

Source.s of Finance (In UA M illion)Source Foreign . Local Costs Total Costs % of Total

Exchange

A DF 4.34 1.89 6.23 G .4TAF 0.83 0.43 1.26 13.0G overnment 0.œ 1.œ 1.X 10.3Beneficiaries 0.00 0.60 0.60 6.3 'JICA 0.58 0.* 0.58 6.0

TOTAL 5.75 3.92 9.67 100

The ADF loan of UA 6.23 million will finance 76% of the entire forei.gn exchange coszestimated at UA 4.34 million and part of the local costs amounting to UA 1.89 million i.e. 20%of the total project cost. n e TAF grant will fmance 13% of the toml costs for instimtional and .technical capacity building wléch will include provision of training in irrigation and horticulturaltechnologies, marketing techniques, consultants, technical assistnnce, sm dies as well as theprovision of survey, soil water and water flow measuling equipm ent and office equipm ent. TheGovernment will f'mance UA. 1.X million of the total project costs wMch will includeGovenvnent staff salaries, renGl cost for the PM O offices, the land and design work forcorkstruction of m arket depo? and collection centers, and salaries of som e off-cam ptzs professorswho will teach at NRC periodically. The project benetkiaries will contribute about 6.3% of thetotal project cost by providing free labour for construction of on-farm iM gation canals anddigging of boreholes for treadle pumps. n eir toul contribution' will nm ount to UA 0.60million. It is expected that JICA w111 contribute .UX 0.58 rnillion i.e 6 % of the total project costin termq of training for M OM staff and provision of volunteers as technir-ql assistance.

9.EM 3ENDITIJRE SCHEDULE BY COSIPONENT AN'D SOURCE OF FM NCE

Expenditure Schedtlle by Source of Finance

c- .. . - y . - ('Ih UA M illion) - . - - .. .-r .. : - . . .- . .

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ADF 1.47 1.91 1.42 0.89 0.54 6.23TAF 0.75 0.25 0. i 1 0. 12 0.03 1.26Government 0.32 0.18 0.18 0.16 0.16 1.XBenetkiaries 0.08 0. 18 0.19 0.15 0.* 0.60JICA 0.18 0.13 0.13 0.14 0.œ 0.58

TOTAL 2.80 2.65 2.03 1.4.6 0.73 9.67

(iv)

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jjt1 d Tra ini ng 0 .96 .

0 .40 . 0..27 0 .27 0.06 1 . 96 s' '.* 1A . Capacity Btlild ing an.

j . . , , . s. a . Rurktl M icrocyinancë systcm . 0.39 0..49. .

' 0. .ti4. :.66 0.4.2 2.60 . . . .,,.. k-.J ion schemes 0.45 1..0.0 ... . 0.v4.. 0.27 0.00 2.46 . ' 2*.

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-.'.-.J.c. snlall-scale Irriwat

'keting. structure 0.72 0.53 . -o. 14 0.00 0.*00 l .39 .

..:1.'..D . Estab. of a .M ar' ., ' i . : . . .. %z .. E. Projêct Manage 'Ipent . ' 0.28 ù.23' 0..24 0.26 0.25 1 .26 . '. ;/.,.j'

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jt' k.GRAND TOTALI 2.80 2.65 . .y 2.0 3 i .46 0.73 9

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The project will be implemented over a five-yeAar, period witk 1999 Y ing PYI. The g.cblishment of the Project Manageinent Offi ce (PM O) sh ortlisting and selection of the NGOs' ' '''esta , ;l

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. . ) ;, .for fonnation and training of fanner groupj as. we.l.l as capacity building activitie; will '. k,

. ' ' . gj . .* Acom m ençe during the flrst year of the prolect. Cgqstruetien of 'marketing depots, formation of .

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,,m arketing boards and tralnlng of DOI and D, .OCP staff, gqd farm ers gröup. , leadersa design, .,. . .

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' . -- . . ' éq 2:. .aconstruction of irrigation cnnnls and rehabilitatip

. n tpfz :' , ,i k dnm . g Will. âlso Cta. r't in prol. è:t #. 4ar..1 . . 't: J ' ' ' . ' : h . '*' *e

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and continue into project year 4. Th ere will be a mid 't.yrm reviçlv #,j? projecLt ,y' ear 3., Fanitmr .z.''&:,,-

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groups foA ation and tralnlng through NGOs will contilw e thro.ugh' out proled im plem entation 'from year 1 to 5. ,. ,

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', 11. PROC I NT OF GOODS ANFD SERW CES k

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. . . j 4 . . j.' .. .>Procurement of goods, worl and acquijitiosp f. constllibing services finnne-ed by the ADF ': m;.). 1 j . . . . , . - .

. . . . trjw ill be in accordance with the Fund s Rules of Proéed

. qre yf'!7r Pro4u.t... =, m ent of G . L and.W orks. :,. ,it5 ' . . 7.. j! jrp. #.. ;ï*. <' ' . ' ' . '$=.or, as appropgiate, Rules of Procedure for the U.$g cï' f' C

.' on-m. llmnts, ., C'çmr c't.sl for vehicles and .1q .y; y.' ' . . - . , ' ' 'Office equipm. ent will be awarded under lntenùtitmàl Cq.h4' pç, -titijve tljd' dm' ,g.) (ltt tCB.) proceélures. ' L':. . . r s . , . , g , . . )1 ' ' . 2. ' -s.'.-in' . àltlc..k'lil:-uk'.a.ti.on .e'.q,u.i,l.?rtj' ç-nt wjl. ..l l:,e . ',',.t.t1 mrge inigation, equipment will be procured t11r. okgj ' I.@.B. . , , .. . . . ). . y. . : % jjy (2> . . ...z upprocured usinc NCB

. Survev. soil and water flow :;1.11. easuM.. ..c. en''uy.pl1V . :,11 t wi.1l lx 'prœuçe. d usaing ' , .z.. G 1 -' - . m ?. . . x , i **''' '*' . -. ;T' A.1 f ' ' '*' '' ' ' - . *. . , .7National Competi 'tive Bidding (NCB)

. Food pmcessihg equipzM. -:.n, t .will l>e prx ured usin'g '

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National Shoppinglls) . The ma'terials needçd for. on-farfm-. , 4a11:.1.:. ,' tènd l'e., velll, g' And i'ccllqctjo'n . s.,))centers aze dikersified and readily avatlable off-the shelf aoods; th. e, s'e will tye prx urxed thrt ou-qh , .k..*Gè'- b

m . . . syytj; N S. Procumment of civil works for main irriRation èânals wl11. 1x. carried out ugder 1CB .,. ,k!

' *-- ' ! ) . . . .,., .kprocedures. Proc

.urjement of civil works for the mar. r,#,et..dep'. (Ats wtl1-)l t#; cârli.. ' ed out t.h17, ough..ICB s. ,' .

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. . . . . . . ). ,4' prœ edures . :proc. urlem .ent o. f Tec.hnlc. al .Assi,s. lnt,'. Sthoty AT. .e. np Cop' s'ultn ncy .Sen'1cès,. E. Xterrp .p,1 .. -. ; , . , . .

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. -'..':r=-:.'..f-,.-z!Aud1tOr...% d;.the .tkse.of-nle al.-speciéllz.e.d . àgenuiùscort N GOs '.-orkln. stu .inaxM.a1ai. 'i:;..>a11. G -:on. ,tllep.ruu'ar-.4g't.+-:G %.:..

. bî' .x. .basis of Short List. . ' j'' ':

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. :' 12. CONCLUSIO NS AN ro RECONG G NDATIONS . =J

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he Horticulmre and Food Crops Developmeht project is in line with' the ADF W I' Poliey k ï.. I .. . ... jyy;,tgj jy , jy . jqf-âq.and stmtegy bf. pgverty alleviation. The proposèd p,li4)èe. t confz' orrné: to the vernm çn

., . ., l ' . ' ' ' ., . ' ' ' k-oblectives of lm. proving smallholder crop production' by rtpromotîng ,11,1.' e adoption of lm proved ,C,Fl ,.t - ?;, $ .

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necessary capacity building for in-igation, marketing, credit and irlstitutional support to stimulatesusminable agricultural development. The irrigation teclm ology to be prom oted is sim ple and asit 'yvill bc backed by intensive farmer and staff training; Lhus it w ill btt fnas:ered witllin areasonably short period.

Poverty alleviation strategy of the project i; conceived within the framework of totalbeneficiary participation. The incorporation of two NGOs and a flnnncial interm ediary to train,

implement and manage credit for tlne project will minilnize Government inten?ention, strengthendecentralization and parlicipatory corfununity developm ent. Farm er Clubs and Savings andCredit Community Based Unioas (SCCBU) will be involved in planning, implementing andm anaging, especially, the credit component with a built-in-mechanism for credit recovery. Thiswill create ownership and sustain project activities aher the project implementation period.Contlibution to the investm ent in the coastnlction of on-farm canals by the beneficiaries willalso provide ownershîp of the project and further enhance the maintemance of infrastructuralfacilities and add to the sustainability of the project.

Improved food security situation of the beneficiaries will be achieved tllrough increasedproduction of food and horticultufal crops. This will result in higher incom e accrual athousehold levels, speciscally, for rural women, the youth and children and betler nutrition andhealth. The developm ent of rul'al infrastructure will further help the rural wom en to have betleraccess to markets for small scale trading activities usually carried out by wom en. CommunitiesouBide the target groups w ill also benetit from im proved access to m arkez and higher levels of

employment genemtion due to project related activities.

Pm icipation of nll'al wom en smallholder farmers and the youth in tnaining, farmer clubsand credit unions will empower them to assim ilate higher levels of fanning teclmology and also

boost their confidence and self respect. These project activities will further assist rural womento achieve higher sœ ial status which is vital for the success of any developm ent effort. The

project, therefore, is economically and finnncially viable, and sœ ially desirable.

Reconunendations and Conditions for Loan Approval

lt is recomm ended that an ADF Loan not exceeding UA 6.23 m illion and a TAF grant notexceeding UA 1.26 million be granted to the Government of M alawi for the purpose ofimplementing the project as desclibed in this appraisal report subject to the following .conditioas. .

Prior to entry into force, the bonower shall have:

established a Project M nnagement Oftke (PMO) based inappoin% ent of the required professional and support staff whoseexperience are acceptable to the Fund (section 5.2)',

Ltl' ongwe and thequalifications and

ii) opened a gr ial account for the project funds with a cornmercial bank acceptable tothe Fund and which hnq blanches in each of the Agriculturul D evelopm ent

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(vi)

DivisioRs (ADDS) covered by tl3e projeq) (para 5 .3. 1)*,

iii) submitted a Nvritten undertaking Llxtt any allocation of iand to be used fo'r the Project,l .

including custom ary land, shall be canied out fairly in ttccordalwe w'i?h the laws ofMalawi 'tpara 3.4. 1),'

iv) submitted a written undé ' g 'concenzinx à1.qlit%.. ation of land to be used for theconstruction of four marketing depotk' .1.:1. dâch. of tuhe Agricultuiral Deyolopmentl

ADDs) and collection centeo in qach' of t1:. e Exterzsion Plaaning M. easDivisions (I .

'

(EPAs) 'eovered by the prolect (para 4.3. 18.)*,

v) submitiod a written undertaking concem ka.g 'tli. .at k will subm it a list of suff to bel q ' ' ' 'trained through Japanese International C'o'lplvto oratlon 'Agency (JJCA) êts well 'as a

1 j ihinti'a' 1. assistant before June 1999 (paraswritteri renuest to JICA for voluntarilv txc, . .l '*' '-' :

'

4.3.2 and 4.6.1).

B) Other ConditiorsI .1

. Provide evidence that its contribution to th e project is reflected on an nnnual basis in theIM OM budget;

l .; . .2. Prior to any disbursem ent of the ftmds for the credit dtj' rftp. onént of the prolect:

i) the Borrower and National Bank of Malawi (N'.,' BMI shall have executed, in a fonn j.( .. 1(

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satisfactory to the Fund, a binding and uncownditlonal agreement for the adm inistration .l . ' .

of the fu'nds for the credit com ponent', '' $. '.:,r .

. .: .. .-1 ...(ii)

the Borr'ower and the M FI shall have executed, in a f o'rm satisfactory lo the Fund, a .binding and unconditional agreem ent fck th' e oh-lopdqing of the credit portion of the

lds to the beneficiary farmers; and stfbinltled to thë Fund a cbpy of the model *' 1Loan fun g1 .

agreem eRt.séiy#E

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PROJECT STATRIXMALAWI: Horticulture and Food Crops Development Project (HDP)

Logical Framework

Narrath'e Summary ('NSI M easurable Performance M eans of Important Assumptions 'Indicators @IPIs) Verifications (MOV)

Goal: (Goal to Supergoal)

1 Reduce poverty among 1 .1 Average farm income significantly Statistics of M OAI 1 - 1 Gov. reform programmerural people by increased', remains on trackpromoting broad based 1 .2 Statistica! Government .

and âccelerated 1 .2 Simple technology of high-return publication. 1 .2 Adcquate Governmentagriculœre development. . promoted to and adopted by support (o (he project

' ' farmers.

-' 1 .3 Favourable prices to susuinproduction

Project Objective: .

1 Agriculture productivity 1.1 Irrigated land increased by 3,400 Base-line data and 1 .1 Low probability of droughtand farm income of the ha in 25 EPAS by PY5: sample surveys; 'smallholder target group ' 1 .2 Adequate and timely supplyincreased through better 1 .2 Average farm income per 0.4 ha 1 .2 Sample surveys for of inputsaccess to small-scale increase from U$ 62 to 515 target groups-,irrigation, horticulture annually by PY6; 1 .3 Adequate institutionaland marketing ' 1 .3 M OAI tiles and capacity for agriculturaldevelopment. 1.3 Irrigated land will be cuttivated records-, sector;

2.5 times per year andproductivity will increase more 1 .4 Adequate supervision andthan 2.2 times by end of PY5: appropriate technology .

transfer1 .4 Target group form and m anage

350 Farmer Clubs and 12 Credit 1.2 Accredited FinancialUnions by PY5; intermediary to manage and

. administer credit. .1.5 Improved nutritional status.

1 .3 Project Beneficiaries are1.6 Progressive change from hatched responsive

houses to corrugated sheets

1 .7 Im proved human resourcemobility (bicycles andmotorcycles).

Outputs: 1.1 Survey, soil, water flow and soi! 1.1 PM O's files and 1 .1 Same as abovesampling practices in DOI, 4 . records', '

1 . Building instimtional ADDS and 8 nurseries forcapacity in irrigation, research stations and DOCP DOI tiles and records 'honicultural and improved by end of PY5; at ADDS and RDPS 1 .2 Trained staff eftkient andmarketing technology in levels', accounuble to the projectthe project area; 1 .2 166 extension Front Line Staff,

370 Farmer Group Leaders, and108 Subject Matter Specialiststrained in irrigation, horliculture,and food processing technologiesby end of PY2; '

1 .3 Capacity of the two DOI, DOCP,and Research signijcantlyimproved by PY2;

2. Establishment of a credit 2.1 850 farmers reached. 30 Fcs 2. 1 Farmer Groups adopt newsystem and emciently grouped and trained by one NGO technologies and creditmanaged by NGOs', each year covering 2-3 EPAS system provided by the

smrting PY1 ; Same as above project;

2.2 1 ,700 farmers (60 Fcs) reached 2.2 M arket interest rate isand facilitated by the credit affordable by small-holderservices by MFI covering 5 EPAS farmers in the project area.each year surting PY1 .

2.3 Farmers voluntarily participate information of farmer groups/clubs

- and Credit Unions starting PYI;

2.4 UA 2.6 million efficiently utilizedfor credit.

. . rs . > hv rrqlr;* jx 7' i ' *- 'e' 1 R . ' M% q.p v 7> *!'V >Xl ' WPY . , .. . .C X ... I ' . .

. . . . ,.j. l .Narrativc Sunmlar jy h'Icasurable Performance sleans of Important Assumptions . .,,f

(NS) ! Illdicators (MPIs) . V.. erificatiohns (5f'OV) .

'

. ljï

.. ! j.ifk

. r . l ' ' J,.3 . Esmblishment of small- 3. l Needs assessment prepared för .ïsame as above 3. 1 Cost of irrication. eouinme-ljtè li .

.z . '. û.a '' z z .

, .; :: g. ,scale irrigation scheines about 60 Fcs starting PY 1 -, affordab'le by farmers', . 'd..r.g!tè'.

4 ' , u.and managed by farlners, t

3.2 395 ha irrigated by (readle 3.2 Projedt B'epefic-iaries a're . .' ...,.,'.,b PY5- . reslohs'ikL td repaim thlïi-r '' 7 -''*p,.Pump y , p .

. x- k .. ?' Gelds for wàter distrtbuti-fm , .t-j:..3.4 1 ,398 ha irrigated by and maintenance o'f ,th-ç'iI1) ' 'et-:. C.. . jmotorized pumps by end

. of .

pumps. ' ' i ' ..

'

.

'

lPY5- '.. ' -

3.3 F armérs a.re wiltipk,lo ' ' .k . .?0 ha irrigated by canals parlicipate-.in .iàbou-rt wopk , Ci: .3.5 1,59 . , .- ' ri th Jir tields

. ' '7 '!-and lifting p. umps irrigation i e . .. .

8 . . - ' q' .% . .systems by end Of PY5; : ' .c. .. '

. .:j .3

.6 25 earth dams rehabilitated by' . .' +''end Of PY5' ' Q k

' ..1

3.7 431 tubewells esublished by ' ' ''s* -end of PY5 - . v' '.,'.. ,, : t: ..: è

I , ';k,

3.8 A total of 57.6 km irrijation . ,. . t r 'canals esmbblished by end.of ' ' ' .V1 0 ez .PY5 ; . . ' t . . y-j:l

3.9 A tolal of 41.5 km drainage 'w-canals established by end of L. 'PY5- : * 'i- $'' ', 7 ' ' .'i ' ' ' .< .

. .i.,

. : . ' '' t ., r ; . 7 . ' . ( . 1.

4. A marketing structure 4. 1 Five marketing boards 'âamè. as abckve 4. 1 Marketip'g i.pfurqjgtiop and ,2 '.AL'h.. . . a . .. o jejtablishment and esmblished by end of PY3; channels rtgxd. l 'N. .fl.y c.effi. ciently managed by provided7 akïl 'uk' èd 'by S ': 'Q. . ' . t !marketing boards and 4.2 Four marketing depots farmers; .

l :r.'' slablished at 4 ADDS and .&'. ts lrepresenutives farmers, e .

managed by end of PY3; 4 .2 Local myrket capgoity is ';, '' ''.. . . .; I . )sufficieqt tthabsofb surplq:s . ' .)

4.3 25 collection centers for of crop prodpction; . .. '.':'

marketing established at 25 . i, '' >

#

'

. .

EPAS by end of PY3; 4.3 Commertiàl crpp pricis ''-,fiëdp

,romotes marketing . j.,.tactivities fof sulplus Jf ' z. )%

: 4production. .;tj.i

. g. . t .. *t;.%?'..!'N

k ' 'il5. Project Management Office 5.1 PMO staff well qualified and ' Sarh.. t asbab. oye 5. 1 Timely recruitment of PMO'n -' :J

. . .. ' ' . ' ' ' s J#esmblished at Lilongwe and efficiently implemçnting the staff

, Tàs and. short term ' yefficiently coordinating the project as scheduled. consulunts s*kak

' t impleinentation. ' '?Sltprolec , j

5.2 PMO meeting the above ./7.erformance irfdicators.' .ïP .

lt :. . a

j' .% : jl I Actounr.s Diparenrni- ' reèocds 1 . 1 Efficient executing .agen'dy satisfactp!ky .. 'e2t4 . Activities Inputs and Resources ' ,

. . ,.coordinatian among:. paqicipatihg : .. . . ) ...' ! .2 M & E rMorus. ministries . ' ''

.' l . Capacily Building l 999 2000 2001 2K2 2003 '' ' '

l .3 FLAD Dissbursemrn! rdcords )l .1 0.96 0.40 0.27 0.27 0.04 ' ' - -2

- Rural M icro Finance 'l .2 0.39 0.49 0.64 0.66 0.42 .

3. Smallscale Irrigation .1 .3 0.45 l .00 0.74 0.27 0.X

4. M arketing Structure l 4 c.,7z o.s3 c.14 co(x) c.()()

5 Project M'anagement Oftke 1 .5 0.28 0.23 0.24 0.26 0.25 '

I . . 'è- - -- . - - . . --. .- -. . . - - ..- - - --- . % . ' . ..

t6...:'':

. . . ra. : t ' . '*,jq r T jskz

. v e' a k '

..ky .ZtL e . .x.'<k .. x. .0. *u zk .. )z ..aL é .w wl.:- - = ' =' *' aœ V'' ' +.-ww.:'-fz zyyd.-s .u...w.-.aL.a..J''= ....,k..Jï . '' . '. z' .* : <d

1. PG RODUCTION ANY BACKGROUND

Ori-faill and Historv of the Prolttct

1 .1.1 W ith a total land area of 119, 140 k1112 M alawi is bordered by Tanzania in the North andNorth W est, Zambia in the W est and M ozambique in the F-ast, South and South W est. Out ofit-s total land area, 24,200 k1h2 comprise lmke Mélawi ané other smaller lakes. lt stretches fromlatimde 90 45' to 170 5' south of the equator for about 9* km in length from north to south

,

and varying in width from 80 to 160 lcm . M alawi is one bf the m ost densely populated countriesin sub-saharan Africa. 11 population is currently estimated at about 11.37 m illion with anaverage growth rate of 3.3% per year. Approximately 87 % of the total population lives in therural areas.

1.1.2 M alawi is not endowed with many natural resources. Its m ain resource base is agriculturewhîch plays a key role in the country's economy and accounts for 43% of GDP. The economyof the country is heavily dependent on rainfed agriculmre by sm allholder fanners. A studyprepared in 1996 by the W orld Food Programme (WFP), USAID and Govelmment of Malawi(GOM) on Vulnerability Assessment and Mapping (VAM ) estimated that rural per capitaincome is at US$ 66.* per annum with the poorest area being as low as US$ 35.* per annum.'Ihis classifies M alawi as one of the poorest counties in the world. '

1. 1.3 Recent droughts have greatly affected agriculture production, and m ade rainfedagriculture unreliable means of achieving sustainable food security, pm icularly with theincreasing population growth. Development of the sector is therefore central in theGovernment's effort to reduce poverty. ln 1995, the Government of M alaFi (GOM ) produced

. the Agliculmral and Livestock Development Strategy and Action Plan (ALDSAP) withem phasis on m ral poverty alleviation. 'lhis Action Plan continue to be the basis for formulatingMalawi Agricultural Sector Inves% ent Progrnmme (MASIP).

1. 1 .4 On June 30, 1998, the Bank received a request from the Government of M alawi tocoasider funding of the Horticulture and Food Crops Development Project, which is a very highpliority area in the Government's effort to improve the food secuiity sinlntion and forem ployment generation in the rural areas. In this connection, a Bnnk preparation/appraisalrnission was launched duling September 1998. 'rhe m ission held discussiors with al1 the

stnkeholders including the donor commurtity to erlsure that the project does not duplicate on-going donor activities in the sub-sector and/or irl the proposed project area. Tlzis report reflec?the m ission's fmdings and agreem ents reached with the Govelmm ent.

' .... . . . . ' ' . .- .. ' J ' . ' - .. '' .... .' '- ' . .- 7 . - -. . . ' . . . . ' .. è,=..ucu 1 .1. ,5 u'n e jwjçcta-iri. .l.jae- witù- wtlk-.AD. F--vIl 'd. èkçlopmçni 'stra-tègy-4lucé laysuuemphasis-on' sas '. .. - ... L7 --

poverty alleviation. lt further proposes a smallholder strategy, especially for women and the

youth, for income generation and improved household food security. The project alsos'upports the Government development objective of eradicating poverty tluough thediversitk ation of the econom ic base, especially the agriculture sector coasistent with a broadbase growth strdtegy.

Performance of Similar Proiects in M alawi

. ) t : J >. ' . al. - .u - -- - - .. , . p rc - w. ...rr,.-c.aq guyr .. . = . . .. . . - . .. x. - . - . . .. .. 111! IITT!!SPI ' . .. .: ' .. . ,. .''' 7' -;A D ' ' . D '-7 * WlrT-x. ..;). ..e '

..

. ' ::4ç

' .7 q

.7

j. .

' ,'

t1 .2. 1 The Bank Group has fmanced a total of 14 prolect: i.grk M alawi. T13. e commitmena to the E j

f th e tlté. :.1'. So far 6 agriculmral project.s are )agricultural sectorlaccount for 27% (UA 83.54) o . y .

on-going, of wllic 'k, 2 are l'ural development projects, on: àglicultural senrice, one forestry and :l . ' . . . . . p fOne livestock development plq ect. The Rural Ineôm e E tzh ancement Prolect has not been 4

,. ..%

declared effective. .;.q.t '.k

. ' ' ,11.2.2 . Pelformance of these projects hake iniprcwbd in mcent times . and have been ratèil '+

. . l - ' . . 4satisfactory with an exception of the National Liveaftlck P.t% ect, wlziçh faced a Humbçr of . r j. I ' . ' . t . .lnqtitutional corkstraints. The Bank has restructured, t13: prolect . and. the Government .has ' .7k

I . ' :.C ;informed th e Bank that al1 tlie conditions laid d' oWùuî bv, .t1) q Dnnk h. ave been 1121f1 lled. A Bank ' '. 1 <

'

. . ' i . @rnission will be 'scheduled early next year to review . th e situation and m ake aoorobriate 1

I -- . -- A x 'L . '. '':t

recommendations regarding the progect implementation. .' jI ''--A,2

. TI'1E AGRICULT SECTOR è '!. j

lii '

'

'

'

'' ''' '

'

''''Si5i

'

Si5i

'

2. 1 Salient Feature,s ' . .' .q

2. 1. 1 Agriculture is the mainstay of M alawi's ecfmomy' . The. secttyr co'ntinùes to play a.centrgl ?','

. ' 42

role in the 'social and èconom ic activities of the inatitmk, It contri, ibutçs 43% of tlw Gross ': .D tic Products (GDP) of which 27% oligilptes fl//:il the smallholder. Furth ennore.. it ,:/:Omes , . . ..,

'

95 % of total export earnings o.f'.w. hkh tkbacco, tea aàd sugar alone Acçoopt . :''r.accounts for 90 toj . vyfor over 60%. The sector directly employs 87% of the work force and provides raw matérials ,ifor about twp-thlrds of the manufacturing sector. . .. :

j . . . , . . , y jy2- 1 .2 Structtzre: The acricultural sector is dualistic in ,rlatil, re corksisting of (i) relatively. large ....i

' scale, m odqrn estates and. (ii) smallholder fanrz, 0 f tfl'. e 5.3 ,milli' on ha, suitable for: cultivation, . . :. 8. i illion h'a a.re kfnder smallholder h'about 0.9 m illion ha belong to the çstate sector whilç. ,3.' m

j' 1sector. The' Smallholder Sector occupies about 8O.%>()f tohrtt crqp.ped' .afèa.. 'Their falrm siz esvyary '' .1I

with 55% of all smallh el ders ''oultivatykqgxless than 1 ha; 31 %' bétwëçn' 1 h

. a .,,across the country,

and 2 ha and 14 % more tIAaIA 2 ha. Smallholdors arç ltr/gaged mainly in. sub6istence farmmg and k . .. ' ) ' . . ' . , -)l t

. cultivate a vnnety of crops including maize, pulij' esrj Fdrgàltjttl' :, m.' L 'lllet, seoFpea-s, soyy beamr'q and . ,t.R; ,

, ... ,igeon peas, poltoes and cassava. The estate sector .ij' ehgak' kd pfW''akrJhly in the prod 'uetion of .1):/ ., - .. ;xc; .l . . .tobacco, coffee, tea and sugar.. . .' .

. ;q(.

2.2 Performance of the Agricultural Sedor ..i. j . -, , . . ..tg, r .. .A

aricultural c 'rowth rate has vnned widely over th e vear. 1n, the 197. 0s it arew by nearly ..., ' 2

.;. , 'h''- ''''#' I *>' . q ..' *#' . ' . '*''- ''' *'' . ):àr Z>.5 %

- irt the earlv 1980s bv 1 % .and..' from - 1987 to.t 199 D' k b.v: 2;7 % . F .lprp'- 199,2 :to 19. 94, 1.,. e -. ..z . .. t' (', '= ' ... ' e ' -. G . - . -- . .J ..:. . %. . - - i '' .. . ' . '. Sy . .. .-:

T9'z..-,.u.

'' '

.a-= 'culu bio,sec'tor.l.ex'pehence' d,.a.-..n' egativec-'growtlh . 'rate, . .m' ' ainl' y- H '''e- til.i two--m. . ajof- drou'yh'tj ,in'..-q.iccc.' -''u,.:-.'-,a' ;Y. -:.::EJ- -.I .. ...:, . ,, . ,

... . C>(

'

1991 and 1993 respectively. Following reasonab lç..raîln. s and tsubsid'lr.fzd distributiefl bf seed' and .ferlllizer to smallholder fanners in 1994, the .country. çqJ.o'. yèd: a good .harvest in 1995. M aize ,. 7

l .: ' . . ' ' t'? 'production, for example, incmased from 941 ,.$(XO. ' , tqfu, 4': 'to'' ' 2',(!1 3.8.,(XX4 '. tonnes ' in 19.95 /96 ,... 'l : . 1;, -u .'

season. Inr 1994/ j95 season, agriculmral productiep, gtèw, 'Fby' a robust .29.7 . pœrcent ,and irl . ' . .' i ed 38 mrcent growth pkèrrth e jr' evio'us year. This cû.. ntin' uous. grœwth ' q' l1995/96 th e sectorj regis er

. :'K ' : ' ' '

. à.Ls m ainly due to expnn.qion Of smallholder prod. uctitm eby./o per cent.. .;

. ' jyll '>2.3 Agricultural Institutions .:.

. s.r(i! * ' ... , ' '' dF ''.,

.?. .

. ...j. '. o'n

. '' ,')t ,

. ' 1':j

> ') 4'

. . , ?' . .. J ''*. (. ' ' . tjju. . . a . jà)jj(). .- ;k . j,kçj ; ylù.j..- , ... .,j...x . . .... .+ . ,. . . .?v....-.-. .-.. w .. .. ....... ...2....,.s,., .ezwu-kt,k.awk.x . zL.. . . .s,..;aa.u:1k.:.!...:lw... k..u.uw.. -k:-., w. ., . . ... . ,.w ),.u< ,.u.= .t -?t .

= + )

&# .* #'a 1 ''p. :.

The Ministry of Agliculture and Inigation ('M OA1) has the overall respoasibility fordevelopment and adm inistration of the agriculttlral sector. The M inistry has six technicaldepartments: Agricultural Extension Services IDAF-SI; Agricultural Research and TechllicalServices (DAIWSI; .Animal Health and Industry (DAHI); Aglicultural Lxand Resources andConservation IDALRCI; Department of Crops (DOC); and Department of lrrigation (DO1). Inaddition to these deparr ent-s, the M inistry has a Planning Division which is resportsible for theplanning, executing, reviewing and m orlitoring and evaluation of developm ent program s. Thefour departments of interest to the project are DAFS, DOI, DOC and. DARTS. The fourdepal-tments together have a toll of 2,2* Front Line Sbaff IFIwSI.

2.4 Azricultural Credit Institutions

2.4. 1 n e fmancial sector in M alawi corlsists of two m ain system s - nam ely the fonnal andinformal credit services. Apart from the commercial banks, other development financeirkstitutions (DFIs) are providing informal credit services to rural sçctor. The DF1s consist ofM alawi Development Corporation (MDC), Industlial Development Fund (INDEFUND), theSmall Enterprise Development Orgnnizmtion of Malawi (SEDOM), Malawi Mudzi Fund(M MF), Malawi Union of Savings 'and Credit Cooperatives Limited (MUSCCO) and the PostOffice Savings Bnnk (POSB).

2.5 The M arketing of Horticultural Crops

2.5.1 On the whole the potential for horticulmral production still remains under developeddespite the country's comparative advantage in producing m ost horticultural crops demanded inthe international market. n e m arketing of hoMicultural crops is divided between the export anddom estic markets. n e export m arket is alm ost exclusively exploited by the large-scalecommercial horticultural and cooperative estates. The dom estic market is of m ore importance tosm allholder horticulture. It consis? of supenuarkets and institutional buyers. Tmnsactioas areconducted through contracts with respect to quality, quantity and price. Prices offered on theaverage are lligher in tlwse m arket-s and are less volatile. M ost of the produce of the smallholderfanners wltich enter the domestic market is chracterized by low quality, lmgraded andunpacked produce. Since m ost of the valueladded activities are not undertaken by thesm allholders, they get low prices for their produce. If such viue-added activities are done bythe smallholders, it could enhance the marketability of their produce and consequently fetchMgher prices to increase their incom e.

2 5 2 n e Agricultural oevelpppent Markeiing cooperation (AoMARc) frqm 1987 ceased to-. . e : . . .-- '

'

ltul'al crbps'.-l-lowevèr, it'ostill: intervenes irl .the màrketingr'qncïs.-' .. .- . . :.:f q.u : .L-...bç the sfge. huyer. Qf. food. andmhorticu .

of maize which is the staple food of the country. 11 withdrawal from the m arketing ofhorticultural crops, especially fruit-s, has dem otivated sm allholders from growing those crops.

2.6 Govermnent Policv in the Aericulture Sedor

The Govemment's medillm and long-term objective for the agricultuml sector aims atruising farm incomes and promoting econom ic growth while cortserving natul'al resources;improving food self-sufticiency as well as the nutritional stattzs of the population', and expanding

. . . a . . . . v . . z .gu , . . ' . , XA r- v; .vn E'V . . . X *NS U'Z XXF X; '. . ' - r- IQ7' . . .. >j.y.j ..+ k . . '. - ' .. r;-. .,. é '

. ' . !.. >-5

...!' ' &J'

. vijr

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. :'

4 J. ' ' . ' 1(

. and diversifying crop and livestock production for' lkcal. and expi)n markets. The major ' . jd by tlze GO'M to facilitate the re''ylizations of these. objectives focus on policy 'tl. , strategies employe

- forms and genellution and dissemination of app' tgprtate technolb. gy. The Agriculm ral and T'l e' * ' . . I x . ' : ' .. ' ' ' 'Livestock Develobment' Stratecv and Action Plan (A

. LDSAP' ' p. Nyhilh was prepared in 1995, , . oy''.. . . 2k.I . d''':' '#' '.

. . .hik ; . ; #' - ' z.' :.' . . .

emphasizes fklral 'poverty alleviation and constitutes thé 'li asis on -whj ch th. e poriori'ty areas for ' , ' .investfhent upder 'IMASIP) will be pursued. ALDSAP i,sèdetermjlwd to acceleratè broad-based : -' i

. . ' ) . - . ) . ZL . .' , l ' , ' . ' ' ' . . . . . ? '

. . ëjz'' .' agdcultural; ànd 'rilral d-evelopment as a nïajor elèment: of, its s'tmggle ageairkst pove. rty . The '.q;

: . 1 . . , . . . . .:.. , .. .

(.;.:.#. .covenAmerit h.. as n'zade serious efforts sincç 1987 to èifil' plemens stalcttiral atnd secturzal adlustmsnt '' . .. *.-'''' ' . j . . ,); ''.' . r. . . ,. . 't

'

., . . . j,.,r . j.measures to kemoy e the baniers to enhance ranid erô. wth' ' god' development of i.he ac/icultural ;. j *' . h''e k .. .. ) ; .j . a. . . w' .sector. 'l-hè impact of policy reforms on agrktllrtulk/. Lfp. 'elfocmàncè has been remarkably . rt

, ' . . . I . . ,. . ' . ! . , 1satisfactory, grqw 'th rate since 1993/94 rtmging from 29.-/ .% tb 38, % ., . ?)j3j ' . .

.r2.7 Land Tenure and Land Use '.l 'î

. '

. j . .. !+2.7. 1 I mnd Tenure'. The land tenure systerfl has thwç

. catçgories namelys yPu. blic I mnd, . ':.. . . . . . . I . : f .t .

Customâry 1 And. 'and Private Land. Customary lal)d is vèstçd' in the President w 'ho, tmder the '''x: .. I -' . k . - . . ! . . u. ' .<..

Ch-iefà Act.. deleg lates power to allocate land to trq ditlcmakllhj efs fpr use by smallkolder sector. .. .- ttt ,. . , j j4 yy . .2 . . ... . .jprivate land is owned by individuals either under f 'r#ehold' .:'pr leasehold .i.iyle, Nyiiulè. public land is. j . ( . y tj yy juo u tj r ,g. (

y jjused by tlw Govermnent for developing public lnsiiptijttp/' sudh qj to as an a .j . j .. y .. . r j x, . . . , . : y . .aside fot nat. 1pna1 parks and forest reserves. It is çbt, in'ixytèrtêz.fhr'. at 6.6 million h.a are customypy .

: ..:1'.

' ha are private land and 1.7 million' ''h' a 'hàs been 's' et aside as publiq land' tq be . ?land, 1.25 million

, .1 . . . . . y .jryused for forest or 'game reserves. , $ 'o.

' 11 ' ( . '' ' ' 15' ..,''' '' i2.7.2 Following the liberalizmtion of the Malawi I-antt Ad of 1971, smallholder farmers, in tC.I '

. . !;principle, can appl 'y to register customary land. ,, lo ,wlii ch' , .th. %y .hold usqfmct rights by au'th,orj't.y' ... j . . ( 't . . . . ,.,tt.of the village headman, as leaséhold. Lzaseholds are 'f4' r 2 <1' .vtéars at the flrst ootion. Extension .

. l ,. t' - 1. . ' 1 '*'. .. ' . ' i'' ' ' ' .

of the leasehold fo 'r 99 years is possible once the pedç/pryt' fbrmalitjrs of àurvey an7' regijtr, ay.ion '.t,y,I . t i ::' (j wio .y*

.h!.s system .o' f land ,are com pleted. Customary landholders, in gçnerat, apl-'ar sqtlsfi- .'

, . l 'k ' ' ' J . . /' allocation and securitv. 'Fhe land tenure svstem curreùilv i.n blace wlll not affect the Drolkct .' *F

'

er , . . . . < : ' %*' .

' 'K ' *#

'

' . . .

bCRCOCiG CS. d Yd'

. .rk (.. . .$ k'

d Aericulture ' ,.t-2.8 Povei-tv an ,. '#

-'

'

.

'

..j(1i1I. . . . '. ' . . ê jjM alawi is one of the poorest countries in th. e worlçt. As per the 1996 U NDP H. uman '.t.

Development Index on the basis of per capita, ,GDP, 'lîtfe ex-plçtnln, vy. a. p d edgçgtion, M alawi was ''. .

. . . . . .... . - q jranked ntlmber 157 out of 174 countries. About 60% (pf .t)t. v. pcpql' krion is below the poverty' . .)$ j . ;

- metw,'ttp.p''l', us and GOM (jn . .

'

, lline

. A study prepared in 1996 by the W orld Food mgrwlam. , , . ,j . . . . .

. .. . . .. , j y:.;Vulnerability Assess, m ent and M app.ing (VAMI reve&1.'J. d that 114. . M'=J.iW.i,. rural per capiu income . ;.

' !

:-.-.:::'ëc&.c:cu:.'.J.t',ris ,estkrtakd--.ét.tlss .66.(f.'pef annllm '-.with..vtl) e p. . otttèstgà/eakbeilrl..qvu .1(i)w.. M=US&, ..--35C(X)..per1=;-...' ..=.: ..:- - ->f'-

. j - A ' C & - ' ' ' A 6annum'. This is exacerbgted by poor living cond. itio,m due to high. unemployment rates, .

'.. ', xl-p ,

'

ning inc. omes, limited access to saniution p:d, heaip. , hig'h illàft'e'v gy rate

, s and fopd t /.,'decllMalqwci h6 'k lzyeri in tenp s of .distribution? it is ' .

, 3..'irsecurity. Pover!y is prevalent in al1 regions in

- y . : ' '. - '-' j- .;$1more pronounced m the northern anà central reglorls.

..T1'hï'' . e prolect desir will tnke into ,ë.4id. eration these llimitations to remove the corkstrainz rel' 'atçd to unemploymçnt, incrèmenul '' N: ,cors

2 ',iproduction, processfng, storage and marketing. f

j. '$' 2 9 Gender Issue-s- . .

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vi. tt): j.'

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. . . *'<. z .

5

The ratio of fem ale farm holders to male fann holders various from region to region,hoTvever, female comprise about 60% of a11 smallllolder farmers. Their fann sizes range fronl2.6 ha to less than 0.5 ha for fbmale-headed households who account for 40% of households.On the average women's holdings tend to be sm aller than that of m en and traditionally, womenhave less access to land. Furthermore, the dependency ratio in fem ale-headed households is veryhigh combined with lack of financial resources and inadequate extension support, prévent mesehouseholds from breaking free from the cycle of low-input low-out farming. Apart from crop 'production, women are also involved in raising of cattle, layers and broilers. Other off-fannactivities performed by wom en include post harvest activities such as food processing while menare involved in brick mnking and cottage enterprises.

2. 10 Health and Nutrition

2. 10. 1 ln general, the main diseases dè 'gnosed among the population in the project area arem alnutrition, malaria, measles, dian-hea and anem ia. However, A1Ds in recent years hasaggravated the already poor health situation. It is estimated that about 20% of the populationm ight be HIV positive.

2. 10.2 'rhe nutritional status in the project area is affected by seasonal factors. CMldren withhigher underweight rates are observed during the rainy season th= the dry season as the rainyseason coincides with high incidence of diseases such as m alaria and diarrhea in addition to 1owlevels of staple in stock. Undenmtrition and m icro-nutrient deficiencies especially iodine,

p

'

'

vitam ln and kon are prevalent nmong the rural population.

2.11 Constraints to Agriculture Developm ent

2. 11. 1 Erratic rainfall pattenu and recurrent droughts rem ain the m ost unpredictable cortstraintfacing the sector. Furtherm ore, sm allolders do not have adequate incentives and support toproduce surpluses apart from what they requke for subsistence. Other constraints inherent to thesector include, poor and declining productivity on the dryland, lack of capiul to purchase inputsand farm implements, lack of m arketing channels and m arkeying inform ation system q preventingsmallholders from being competitive, inadequate extension advise, inadequate supply of seeds ofimproved varieties, Mgh cost of inputs and inadequate village- level storage and processingfacilities. In addition, pest and diseases especially durlg the r'ainy season represeflt a constraint

to crop development. The proposed project is designed to support Government's effort toalleviate some of these constraintsy

j.jjs wyks kyoo.l- .-è).:. 3..,.. .IRRIGATION. HORTIGUL -AATDCROPS SUB.SECTORS

3.1 M ain Feature,s

A) lrrication Sub-sector:

3. 1. 1 M alawi is served with both surface and ground water resources. It is drained by the tworiver systems of lmke M alawi - Shire and lmke Chilwa - Ruqrum a. n e weathered basement of

.. , 'h1. . $.. ).'.pl;!''''.

6

tlne plateau and 'the alluvial aquifers of fhe lakeshore and the Shire Valley serve as storage.. j , .f

acilities for groundwater for the country. Of a'll these tsources of water. shallow crouridwaterl - r -. - ' -- .plays an impol-tant role in the development of Smp Ilpqpyfé, irrigqtion. Annual i'kln-off avel ages

16. 14 billion m3, out of which only 7 % is utiliked for irtigat-ion.

' ' !

3.1.2 Rainfall occurs from October to April. P. tedpilation varics from 18X rnm in thehighlands plateauiand mountairs to less than 8, 0. 01)).17) tn ttp-'e vjft valley afeas. M ore than 9t)1 % .ofthe run-off occur 's during the rainy season renewi.'ng .aboutt 3. 0 cubic k ilomçters of.M alawir; freshl

I ke M alawi has 'ap a'yktage 'live. storage mf 90 cubtc kilgiuetersWatef FCSOLIFCCS anlmally . .a

( . . . ' 'u'hich. ' drains to the Shire Rlver. .lts total storage is ;1,(XX' qlgbic kilometers..ldowever, in spite of. , . l ; j a j qyuyought and jow' caiafall.thls quantity of water, Malawi oflen experiences per p

.l '' ' .3.1.3 W ater Quality: There has not been any signjxcant pollution of water both surface atldl ' *'

:ground from posjible pollulnts. Therefore, the quqlity, of water to date. is reasbnably goddexcept for contam ination with some water borne diseasès.

t3. 1.4 lrrigaiion Experiences: Irrigation development started. in M alaw. i in 1949 at Limphasa.

l ' ' '' .-- ' ' ..ln m id 1950s, two more schemes were developqd olx iilt' q Uhitwvphalombe plain. and àn,

irrigated crop research station was established at .Miagét). jka. The, larges g. l : . .' .owned by the Sug 'ar Company of M alawi (SUCOMA). lt cm e irgo, production in 1965 ànd h'as) *' '

.

reached its full de yelopment of 9,2œ ha oflsugarçapq. 'rhjp sk a.s follbwed by the second largegthat sugarcane, at owangwa in 197,.4.. 'M:'.j ïo.1:. cqsh. crops such as tea, coffee,esute of 6,1%

tobacco, macadamia and rice are produced under lrrlgatloli. 1, criga'tion .fnrming is going on in1 jj ' j (; j j

.aj jaa .about 22,(00 ha out of an inigation potential of. a ojut , , .t 'B) Horticulmr 'a1 and Food Crops Sub-sector:

3. 1.5 M alawi has a strong economic comparatiye advânpge in many horticulttzrql cropsespecially fruitj and vegetables. The cost of falp lgbour j..$ vçl'y cheap, cost of production is

heap since sdterallearth dams already exisi, an4 tpjd' l,e puép. .s 'am pro:' uged. lfocally. . Howevercthis potlntial % under utilized. Duzing the last Ycâ'dj, xjhtiittçrtlltz.l.re seètor k. as developed slowly' . . 1 . '' ' J - .'' -and has recentlv be 'oome one of the sub-sectors with an. incaaiing for4ign exchange.rarner. n e

. . f I . J . *

'

wide ranje of clim 'atic conditions and sotl tVoes en&j. le the .o, roductipp. of 'fruiss treçs inoludin. gl 'e '*

'

'' ,6..' *' .

cuhew nuts, macadamia, peaches, apples and pltlfns 14 $e. grown in M alawi. Higk' valuedl .

'' ,korticulmral and. food crops such as cMllies, paprika. m acgd.inm ia, cashew .nut, cut flowers and :'

-. j œ. m. m . . . . > . y.spices offer sinall 'and lrge scale cormnercial prodùcçrs anpy./pp. (lrrtlnity to expand into a hi. 'ghly â

' 1 . : '. .lucrative export m arket replacing tobacco as the m alor forei

.gn. exchange earner 114 M alawi.

3. 1.6 ' MalaWi' hqs ( twö . types. of., farmin: .systems.:ham. ' . è1y:.1

; - ' jj, ) a j yyjoj. srtuye. jroyn ' t'j.finning relies mainly on rainfall, while floodplain fan'nj 'ln..gi4epe, nds ..Qn rèsi' f$ ' tor Ls domlnptbd ,by/rtsmayl,lhold, 'er îëshallow wells and jinigation from stream divetsi6nd. The sql cikc' ' Nfood crops. The area allocated to ..)'farmers who produce a wide variety of horticultural' aaçl

holiculmral growing in relation to other crops is estlmated. to be 10% . The m ain holliculmralops in addition to th1 ose mentioned in para 3.1.5 aboke, ilwlude ordnges, fnngerines, lemom ,cr

bananas, pineapples) mangoes, guavas, pawpaws and ve; g7, eia'zb, 'les such as cabbage, tortzato,onion, mustard, pu 'mpkin and bennq. The demand for 'lioh,iéxl4l.tt4pl and foe crops exceeds th e

q . '' . , .supply and the shortfall is met with lmports. The worst negytiv: ar ctllnlm l > de balance is in

I

. - .c1. , .

wxxauk' ..k> ,' ' ' ' -'t' 'u'&'>l...1-'tvk' '*-.. 'i t - .'Z'Q ' Z'*''=-' '-. ï.-.hù--.i'tk.< zli-w i'-.i z'w= *u- *a. .-z. ktq . - z.

v r . . nrR'r<, . . . N. . . g r. . N. FJ . . !#'F. 6. ...e ' ' ;

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r!w- **' .:

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cornm odities such Irish potatoes, beans, sweet potatoes, cabbages lomatoe.s and pigeonpea.Most of these crops will be promoted under the project to improve the economic comparativeadvantage of M alawi in vegetable crops.

3.2 Government Policy in the two Sub-sectors

A ) Inigation Sub-sector:

3.2.1 The overall objective of the National Irrigation Policy and Development StrategyINIPADSI of 1996 is yo promote social and economic development through sustainable inigatedagriculture. NIPADS aims at projects that are economically and fmancially justified, soci/llyaccepuble and technically sound without causing unacceptable impact on the environment.NIPADS also erksures that inigation development progranunes benefit as many households aspossible and in particular those that belong to the most vulnerable groups of the rtlralcornmunity.

3.2.2 The policy for financing irrigation development is that it occurs w ithin m inim umgovenmnent subsidy and that a11 opergtioas, maintenance and replacement costs are to be borneby the beneficiaries of inigation schemes. The government encourages the application of cost

. 9

sharing approach for capill cos? of irrigation developm ent, tnklng into corsideration thefarm er's ability to pay. The strategy for financing irrigation developm ent prom otes in-kindcontributiofts from beneficiaries and credit availability by prom oting financial irlstitutions 'torecycle savings and invest in inigated agriculture production, wllich w ill help enhanceproductivity of smallholder farmers.

B) Horticultural Sub-sector:

3.2.3 n e objectives of the sub-sector are inter alia, to encourage farmers to grow fruits ofMgh quality for local and export corsumption and to process and/or preselwe the sumlus; toincrease the production of vegetables to m eet domestic and to a lim ited extend the exportdem and while improving the nutlitiohal status of the rural and urban population and to promotethe grow ing of tree nut crops in al1 suitable areas in order to widen the econom ic base of thesm allholder farmers and to provide raw m aterials for confectionery and other industrial uses.The horticultural section of the Depar% ent of Crops has not receive adequate support for itsactivities this has lead to the absence of a coherent and focused horticulnlrnl policy in theCounly.

3.3. 1 A total of nine (9) projecz are currently being supported by a number of multilateral andbilateral donors and GOM to assist in developing the inigation sub-sector. n ese include the

Small-scale Inigation Project funded by IFAD. A grant aid of M II 20 million ha< beencom m itted by the Germ an Government through GTZ for institutional strengthening of theDepar> ent of Inigation and developm ent of smallholder M gation schemes. The Shire ValleyPilot smallholder lrrigation Scheme is being flnanced by the Freneh Government; projectfinancing is reported at US$ 1.25 million. The Govemment of tlze Republic of Chinn hasdonated 2* pumps for inigation development. M estimated US$ 15 million hnq been provided

j' L'

. ' j. 1è ?. -8 .. j, ,: !: V'

',

' . . ' ?!by Government of Japan ti-trough Japan Intem ational

.Cp>pty,. ration Agency IJICAI to finance thedesign and construction of an 800 ha irrigation scheme ifl Bivanje Valley (Salima ADD).

3.3.2. n e Euroxan Union IEU) ùnder its Sta.bilkatjbù. of Exoorts Prokranmle (STABEX).

'K 1 . . *' '''-' . . .f'unding is finaneing the construction of 10 sel(i,k..4,l.j .t,tn-i. Jgation schèmes in the-. B'lantyre,I

.;: . :

.,,. .

M achinga and Mzuzu ADDS. The Danish lnternàtiûùlltî#Lnészelopméùt Agency (DAN. 1D.A) is. j , . . ( $ . .; . . . .

rovidiùg suppo .:1 for finalizing In-igation Policy , itïttlttttioTsal asset.sment and 'studies o'f damP I s .' ' fi tion projects being Ctipanced by theând dambo potentjal for a total US$ 1.3 million. Other ,1ic. . g

.?Govenvnent of Malawi include the construction of Irrig4tsd Borehbles'). S' malfhi lder Irrigption. !) ., * a. jjy , . . . . ., .Schemes Reh qbllltation Prtyect; Development of Sprll/'' Q- é.r lliigytibn Schennes Prolect and

, : t 1 . ; ' k;' < ' ' . ' 'Replacement ot? Irdgation Pum ps. The Chinese A.jhhc.i.l'll$1. rià.1, M ission, th' eulapalnet'e lnternàtlonâl

1 . . : . . 'Coomration Agencv IJICAI, the USM D ahà Th' t' (Vh1i!..' à.à Development Aid (GTZ) are the

l - - ' - . -main donoo. in jvolved. in horticulttlre developihent. ..The ADB Smallholder Irrigation'i j 9:$ o dt,i,s sclwdtged fot boalrd. presenmtionDevelopmept Prolej c,t (SIAIP) was appraised in May'. 1ï ' X2*''::

in November 1998. Under the irrigation 'jub-sçdtör a.ll di't#h' br activities are coordinàted by the. ) ' '' X' *In-igation Task F

xorce of the M OM .

3.3.3 The proposed activities of the Horticultural. and F'd.. od' Crops D:velopment Project willnot duplicaté ' the actikities of on-going honicultù. kali mroikeis. 'but it will rgtkeï- 'complemçnt

. ak *# 2 ) ..

horticulmral âùd food crops development acflvitiès èsp. ecjgills'l. ?k.1. the seleLzted project area whièh. I '- '- . ' f t 4'j, . 'has not bençfitled from related developmentàl and pbvert/hàllék' iatiön gètivities

.

13.4 n -oiect Arèa

4 1 n e Horticulture and Food crops oevelopco.. k,îzt p. tùijeqt will ct over fbur sAgricul,tural.3. . .. . . ... .

Devélopment Divisions (ADDs). Kasungu, Lilongwe, ï.,e - , .1 About 3,4* ha 'scatiered in.t''1V$' t E' xteptsign. Plpan' ning Areas (EPAS)center regio. of the country. .

will be cove'red byl the irrigation technologies and fàcili:tièy. è k nder tlie yroject. F. armers in tiheproject area have 'eustomary tenure thus security of . th. e 1.'à. i'ld,. in the pmject is not thfeâtened. ,

. . I y '' . . ' 'lkl,'jj. s' . '.' ' ) , . ' . . 'Selected prolect ADDS are shown in the country map àùfid à.tté' Khed table tjf Annet IA and 1B.' .

..k1 -3.4.2 The principles governing the seleçtion öf th e . lp#tzt'l'e.ct sites ' wem : i) technical and .

. . l L..) yj. j ,..)'' j. jyjyty, . .:; jjjj; a ya' yjà. .j)., îjyjpty' . o.ç anj:environmental 'criteria laid down by GOM; ii) irriga qn p Ntent

ccess to nïàcket loutlets; iv) corsideration o.f .f1' eàls' 'è .i' tlkii , .' 'lùgh. intj. idlpqe of povertyl ; iv)Ia .t

. tj:j, b,hrg.ju .jïyim , jlemrute..d apdyor p .ropdyed by.'coordination and surxey of slmilar inigation activi ,h tti als discussed in para

. 3.3 above.; v) torlftt,rtnikiM3lp' :' 4t14 'tlh' :- basi

-c priùciplèj of tl+uonor comrrku ty . , , ,. ... E 1 . . ..r . , a .. . .::7 . . . - .t . .Malawi Agrièultdr 'e Sector Investment Programme ''(M ASIP) 'and vi) 1t1. terventiolis. that match

. . . l 'local capacity for .1m; pkmentation.

- J. * ' () * . . . ': - (j j...(r . . .ly Lr - ' '. -u: sj l ji

.=-.JJ.:/.;7.r?k uc .rc. . Lkz. a z.u . j . .-.., . - .

3.5 Clim ate. Top 'ographv. Soils nnd Veuetation

! . .-3.5. 1 The project areas have two defmed seasons. The dry seàson whklq start.s from M ay andI

. p sber to Aprij. n eseends in October and the .wet season which covers the m lmthq of ove .

. l . . : à . . . .ellmàtic conditiors are lnfluenced bv air pressalte bèlt.s .ln. th. 1 M ter-Trofyical Convorténce Zone.. . ' I e' *' . ;. 2) . . ' ' ïx + h'''# . .; . . . . .Rainfall is unlm

, odal and is higher in the hilly areaj; i. 't ràn' g,..çs 'fröril 758 mm to over 1(XX) mm k. y . ,

PCr yeal-.

;:' kr'j

$!. ,!

.ak.ù'f '.i' ' #' :>' t x' '- ':k. k. -.t.'-v v.-' . -.w,. rzxk.- '=. --u1. u:z.. . u. ... ..=a.. .. : ...-. , -..-. . 'a% -d ' . ''.x ''e--. .,- -b1L. . .,

3.5.2 The terrain of the project area is gently undulating with an average slope of less than oneperèent. In the Rif't Valley and the High-Altitude Plateaux, the altitude ranges from 2* m etersabove mean sea level to 3,(K0 m eters in the highlands. Soils are mainly fenile alluvial depositsfrom the Shire River and terraces lying on the bed rock of the IUR Valley. n e vegetation in Lheproject area coasists mainly of fenile lowland savalma with rernnant.s of foresz or thickets.

' t Beneftciariu3.6 Prolec

lt is estimated thnt a total of 8,5* fa.nn familiès will benefit from the project. Farmers,women and the youth will benefit directly from the project's activities. These fann families areamong those below the poverty line (para 2.8. 1). Subsistence smallholder falqners identitied inthe project area and have expressed thei.r willingness to participaté in the project will betnrgeted. Farmer Clubs (FCs) exist and they are eager to participate in the project. ForsusGinability, the project will upgrade and utilize existing Fcs, but where they do not exist, Fcswill be orgmized by NGO's and the Women Section of the M OAI to pm icipate in the project.

3.7 Environm ental M pect.s

. /

3.7.1 Some of the most pressing environmental problems tlzat have been identified in theNational Environmental Action Plan of M alawi include soil erosion, deforesmtion, Waterresources degradation, threat to natural resources and biodiversity, and hum an habimtdegradation. On-site investigatiorls and discussions with autholities concem ed has helped toidentify the key environmental receptors likely to be impacted by the project. They include: (a)the aquifers, which are presumably vely important in the project area, but whose tzue potentialhnq not yet been fully hwestigated; (b) the soils, which can be easily impoverished as a resùlt ofpoor irrigation and mnnagement practices', (c) the rivers, whose water quality can lx impaired;and (d) I >ke Malawi, which constitutes the ultimate receptor of a1l impact-s generated in itswatershed

3.7.2 Due considerution hnq also been given to the heterogeneity of the project sites. ln fact,the toml project area of 75* hectares is distributed over a number of sites varying in area from10 to 34+ hectares. Four tym s of sites can be distinguished: (a) the general floe plains, fairlylarge in area, and liable to crcasional flooding; (b) the smaller sites thnt are pm of the floodwayand the tlood fringes and generally subject to annual tlooding; (c) the lake shore sites, strewnalong the shores of Imke M alawi; they are fatrly large in area and corsttmte potentially gcxxlagricultural land; however, some of these sites may be part of Rconservation Are-qK'' as def'medin the National Physicz Develppment Plan of Malawi and therefore s'ubject to smcial

rcorksideration. . ' ' ,. . . - . . .. .. . .. ...-7 ..- - -

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4. THE PROJECT

4.1 Sedor and Proiect Obiedive

4.1.1 'I'he sector goal is to improve the well being of M alawinnq through poverty alleviation,

especially am ong 111D 1 m ople, by prom oting broad bnKezl and accelerated agricultululdevelopment.

.yr.s - -.. ,. T 5-r . , ... .. t.jg z . :.7.

10

4. 1 ,2 The specitic objective is to contribute to foöd security by 1.:1. creasing agriculture' ' '

prbductivity and farm income of the smallholdev yargpt group tluough bette.r access .to smalllscale irrigation, horliculm re and nlarketing developmeut'. '

4.2 Descrip'tion of Proiect O utput.s

$

'

.-.

4.2. 1 The nröi:et design has fivè main components, T' hesq are: i) Capacity Building inA . u j . . y r . y y y jinigation teclmology, horticulture and research, ii) Estiàblishment of a Ctedit Sysfem,Esmblislvnent of Small-scale Inigation Schemçs' Rnd. rehabililtion of eanh dam s; iv)EsGblislunent of a M arketing Strucmre for horticulture and food crops; and v) Pioject#

s

'

M anagement.

4.2.2 Tlzrough the Capacity Building componçnt? a. totv.l pf 644, 'tta.ilwrs', 16-6 Front Line S'taff. j , . . yjj(F1S) , 370 Fàrmer Groups Leaders IFGLSI, and 1() 8. 3tlblpgt M. xaqer (SPJ- c'ialiksts, (EMt%)' w'ïll be1 ' '

. , '

trained during first two vears in short and long-tefm mpibin l a.nd (w erjleas (1:. aln 1ng as 'svql,l asj

*e x...,. . x -.-. . . , .

field study tours 'in inigation and honiculture teclm ologyt; marketing, credit, elw ironment and. l ' - .w ater use managem ent

. U nder M arketingj 4 watth. ouse d. epots, 25 collection centers and 5l illstaètl. z.under the Crediy componentè, . 350horticulmral. Marketing Boards (MBs) will be esu . , .I , .

Fanner Clubs, 15 savings and credit uniorks to .be lù.int..nn.g4d by th. e corrimuni, ' .,(y will bel . . j , j qs a. . )y a . j) yestablished. vpor irrigation, a total of 395 ha will .béiisirrllg ..

,@4ed by tmadle ptzmps'', ,

l-motorlzed pul mps, 1,590 ha will be under çaljàl çoowtmctlon atqd 'gmvity-fed i/rYigation.smalThere will be a total incremental cron production öf 4647.*' 'toimes of :tihe crops 'being pmposed

. ' l '*' '*' . ' ' ' ,

under projeét which include maize, sweet potatoes, topploqs, cabb ag',e,' p. ap'rika, . clAilliej, scarrotsand oniorks.

4.3 Detailed Description of Prolect Compontnts zand Agtivities

l(A) Capacity Building

4.3. 1 To ersure sustalnnble M gation and horticultural deikelopment both in the selected projectl . l '

.area and at nàtional level. the Droléct will stmpgtlwn the èapacity, , of M OA1 in irrigatiéri,. . ? ' , , '' j * #' ''#

'

.

horticultural gnd marketing technologies and related amas gs well .as seenscrtlwn the capacity atthe grass root ldvel through a sustainnble training Ttogrnm m .'e. '1hi 's w ill l>e acMeved tluough . .b' uilding the capacity of the following relevant inqtitutions: kî

. . *

4.3.2 Départment of H igation (909: The prolect will build the c-apacity of DOf throu-g.h j4p dp . .

' '

'i jjjjjtrnlnlng ila inigation tecbnology, th. e provision of surv4y, 'sailz water and' .water fldw.menqalring pI . jj! ryvjdé Ltequipm ept and

.bffice equipmept for projeçt related APD. s, > d. RDPS.. Th e prcject w p. .- . :.;

1f&@1 4rJjl o#qrseàso-shpzl-term training for.DO. ls j -. .' -71 6'. , . . ' -. .The local trdlnlng will be at the Namral Resourcej colleye. C) of M OM . For the .1c011 o

'ning and field sml dy tours, provision laas been afade uk' der tlae project to tc-aiiî..',f8o... ai.rri.gation r'htral

lq) 160 Farmer Group 1 aaders (FGLS). and 32 irrigation ofticers at Nàttlral '.2Front Line Slaff (F1- .

. '* l - . s .

Resources College (NVRCI of M OM . Trained FI S, FGLZ and irri' 'gatibh oftkep will 1. :mcn .'1 .

' '''''n .

train assistant oftk 'ers and the orolect G netk iaries 114' , . related sublects. NTRC will use theI '*' '-''' ' '

,dvmonstration plots for irrigation and marketing alregdy p/x jfded by the Smallholder lrliga.tion.

'

! ' . . *'O . V'Prolect (Sh1P). for the proposed tralnlng program. NRC w'Q? iri collaboration - with Bu'ndn. . . j k . . .College of Agnculture (BCA) and DO1

. prepare the requlred trulnlng m nterial for FL.S 'nnd

. a ;'. L â,. . . ' %i'-' ,2k. à.ikd . .. x. ' >' k' ztu . . ''' *r' ' ' ' - ' ' ' ' â' 't à -'6 - -'6 T * '6' ':.;-. . ..u- kw ..u. ,k4.,.--- *.'.1.-w ' t. . ,..

FGLS. Training subjeca will include irrigation practices, land leveling, crop ueaterrequiremenz, on-farm water distribution, excavation of dug wells. operztion and m aintenanceof iznigation pum ps, and eanh dam design. The NRC will also train D O1 staff in tlle use of thefield hydraulic equipm ent. ln addition, six irrigation officers from the AD DS will l:e trained inirrigation and drainage teclm ologies through the already existing training programm e. providedon an annual basis by Japapese International Cooperation Agency (JRCA) to M alawiGovernment. M OM w ill subm it a list of staff to be trained by JICA . 'Fhis w ill be retained as aloan condition.

4.3.3 To strengthen the extension capacity, provision has been made under the project toimprove the management slcills of the key project implementation and mnnngement staff tluoughthe Agricultural Mnnagement Tnaining for Africa (AMTA) proglum .

4.3.4 Department of Crop Production (DOCP): The project will also build the capacity of. a. ' .

crop production, seed distribution, and m arketing through staff tralnlng in horticultureteclmology, m arketing and extension; the provision of field tools and equipm ent; rehabilimtion

of four nurseries one at each ADD, and office equipment for project related M )DS and RDPS.The project will provide DOCP with local, regional and overseas training program. Prqvisionhas been made under the projecty fof the short-tenn training and field smdy tours, to train 80extension Front Line Smff (FIwS), 160 Farmer Group Leaders (FGLs) and 32 horticultureofficers at Nattzral Resources College (NRC) of MOM . NRC will, in collaboration with BCAand DOCP, prepare training m aterial for FIwS, FGI>, D OCP and M OM staff. Furthermore,'

'ision for regional r ining hnK been m ade to train 12 sertior officers from the ADD levels inpro:honiculture extension, crop storage and food processing, m arketing and m arket infonnationsystems, and foreign trade development. ln addition, 14 senior officers from the M )DS will tvtruined tllrough JICA in vegetable cultivation teclmiques, agricultural cooperatives, andexteasion services for fanner leaders. The W omen Progmmme Section (W PSI bf M OM willalso conduct training workshops for project FLS and project beneficiaries.

. ' '

4.3.5 Depnrtment of Agriculture Re-search and Technlcal Senrices (DAATS): Teclmicaland managerial capacity of DARTS will lx strengtlwned through fehabilitation of nurseries atresearch statiorts at the A DD levels as well as agro-forestry pluctices. I-ack of seecls. plantingmatelials for fluit tees, soil erosion and degradation as well as deforesmtion in the project areaswill be mitigated through s'upport for seed multiplication uaits, establishment of fruit tZ'Vnurseries and igrtl-forestry pructices. ln this connection, funds will lx provided to supponChitedze and M kondezi research activities for seed multiplication of honicultural food cropsI tpand for selected multipumose legtuninous trees and slm zbs to reduce soil degrudation, improve

! i ldS arfd supply fodper apd fupl wx d fpr livestock and housçhold fuel re> ctiyely.'yr . CFOP Y C .; , . : . . . , . . :. . .. . ;.. : . ..

''

21.- -J'c:t wrthesé plail' ttnjuat'ehàls-TiiMtl.ùz'lyfov&l,e j will be provlded tY Iifojot Vnéftciarkes 'àtscosi-.''m.z '' JLS..L- '=.

4.3.6 Fnrmer Groups: Project M neficiaries will receive training through residential and inter-district study tonzs. n ey will funher receive training in horticulm re and irrigation teclmology,

crop grading, packaging and marketing of horticultural and foY crops at N'RC. IM e minibtlsm r ADD will be provided to facilitate transw rtation of farmers to the truining centers. Projœtparticipants will a1s0 lx traine.d in water use and m nnagem ent, soil fertility' and environmentalmnnngement teclmiques. The project will recruit a TA s> ializr.d in Participatory RuralAppraisal to % 1:1 Flws and farmer groups.

F T .7.L ; '7!= 'r xv . . . . . ..'. 'U. ' * 'N. ' ..!.-' . 'rri?, . . .r

i ..! . .7 . 1ivj

12 'k.'j

.-

:)(B) Establishment of Micro-Finance Credit Systém j

:

. . . . . . x . . xv . : . 14.3 .7 Under the Drtyect, creclt w111 be provlcec to'e' 'egtablished farmer, women and yö' tl. t1-. 4 ' ' '.f'1 *

. 74 # j sup pyoject y-j-uoj'-xjlh igj, # ; :. Jtgroups . 'Flie Plrlect Will utilize the SUDDOII alrera'.d,v-.pvlydfo'*i,d:d lj', y th e . , ét, A *'

. . ' - :

.-r , . ' ?. r - . . , j j, s. ' ' 7jy)a:. '

. jjzt e : '. r . .ADF Micro-fmalnce lnitiative for Africa. ( . . .' I&' ' A ' ) .ëtfl 'Ytril'd Cthe capacity of M i 'r(3- 1 ,,. j , . . $ t g. , j .a..ja: v major . p roj e'ct 'sublcotm p6 whé,hLs ,I'ntenzediàkriks (MFI' S) ànd credit olientèd. NG. Oj 1h' 7 M' a1@ , ,. ;... j , y ys tgsaj:y . . . (.,(credit

, mir' keting and irligation) will' be impltefd .elqtedï tltr. cluah' . shpttr4. -listina .of the NGOI wliich .1 - ' v ''''''' t ' ' %''''''' ' ' ' ' ' T .

zill be selected by INA programme. Thb p.''lftt'''eet. Qr' 'iv'l.IL' cojltfd: 'ct ony: M' Fl and two NGOà to '-.. *1p4 . . , -.k' in collaboration with Pmjeet 'Mklaâgemelkt. O,f.fi. cl ('PM 0). . ' e the ' . .'implement the p Irolect .. ;

1nd manage tlne credit funds, the two, 'N'. .'G-' .:0

, s will orpanize a.nd tra.in farnkers to '*1will administer a' I ' . . . . .access the oredit facility to lmplement both ilqi gâtipn ailldt.&marketiùg' èomponents. ktj' . j A .,a .

. ' v j

4.3.8 To m eet lhe dem and for credit. UA 2.6 'm illicn tw ill' be available for cred. it.. Th. e f'unds- p'jj :' .. . . . . i..,. kIk... . !r: ,' .

will bè chatmelled through the National Bank qf M . kgtlâisyi (N BM )' to the finançial intermedjonr .%k -.lenl ding to project beneficiarieswpAuk'' ptj.ttiog' of- the creu: it fund wil'l

.be' lavzilâb' .1e fo .,.' -9.il(MFI) fbf on- .j . y . . .. . .. x ..+DO1 'to purchase and exnm ine the irrigation eq'? uiipc iliètlj

.:t to be ha11' i1. ed ö' ver to the M F 1. -As a ' '-.. I .

' . - )-' -. . .1 .' . . .. '

. ., '

. ..'6

staning point, am. awateness campaign will be tth' .d, qtl 1.+ri' by t*il. NGOS in' collàbcyràtion' with , :'the ' Fl wq and S . Trained F1 -q of 'DOI and'D' ,'0. ' N'CP 't 1110.' co. l'laboration with NG 0 ' s. s'i'h f f wil'v1' in ' C '-'''S

. . I . i . 4t>,-.f't iik.wts;f roupc, srmatièn an'd. dy né.m. , ids , as '-:i!.'ttlnl organlze

, support and train the prolèct tafgk.t. pglptl)lil (tr g .I . .% g!

. k# tj:yacjj. payucyzting fatin. 'et/s wïfil J))'jwell as crèdit and water use manngement. U. sing 71. 6 PRA. âp. - p i .. . a. l . c . ) .t . . . . . g y j..; yjjs arej - ....';detërmine their needs for inigation developriwrft tn' 'kltlg. .'itlto cö' rtsidèration the source o . .

l Based on the resazlt of PRA.

' '

, fàiu. f:fF' w 'i.l1 ' bet. règisteted as' s'mall '''(Fcs) for ,,'and land tè.h-ain.. I . .,., , t - . ;. .. . . . . . . . . tcredit. It is estimated thnt a total of 8.5* Y nefiéià'ry f'àiihers in th e selecrezl 25 EPAS will 1* ' , .

organized 'into 350 'lègàlly registered Fcs. ' ' ,4.: . .'ê' 5 .).. ' 44

To avoid nonupayment of credit fund by' fatmerà,.M FI will 1% intkodut ced' to farmers aà a ' j4.3.9 . o . . , j.j : .. ' tj . . ' j . j . . ë . ' . , j . qr yx'ssepnote credit ontity. 'n e Fcs will be organ' ,lzeg ,ïn, tyslager grb. upj to estatylish 12 Szvxin. g aiad ' ,

' 11 (B ed (self-owned) Uiliov (':'ccB.r'' %)', tb uoce' sts the credlt line aJbd''''k hem .,''' 'credit cdmmu w- as . . .I - ,

' . .',.'I ' ; . .: ''t , , : , $ - , ; : .; L , i Jnecessary into lW ater M sociation Bond , 'AB.. ) for m 'on' 'lp) 8 on'oerin in. water mnnn?gb. fnedt fbr . . . ,f.+,,l

. .

> . ) . tyje com ;m, unity i ev'els , t1% e '

.

:ylarge irriza.tion schem es. For sustalnnbilltv of .the . cmdit system a't.

'--'-v . . 1 *' ' . ' ,' : . -- . ; , ' . :; ..selected 'M FI wl1l uoel-ade and utilim existhq q SCCB U'' ts!.. but wherù'.th e.v do nöt 'exist, assi'st m'' ' .. '. .

llkhing newl on J -s. 'rhe fbnaaation of gro '-ups'î'wf: ill.i-'t-.a:i 'tliitxate farrnelr'sa ''uccegs'.to cré..d, 1t- arïd ''a1.?z ', '.jestàb - , j - , r k'

.,j #jj(o(j

... yo ) oogjy, jeta : a n apjjjtxtjtjj.j (1y..1.r). '.j%piovidé' grtmp security and liability. Farm ets wlltl be 1.à

l : j, y yu. j; tu y ya u, juyua uju ,é tuvqj, j,tjj; x js; .jjand pay an affordable entrance fee to conftrm the,i;r m èrffb nrOf Ownership. Pnrtlcipating fnrmers will l)e enclmrag . . .

.

y , ! j a y uyjjjou j y.a regular basi until thev hnve accuired the mlnlmttm. S'harej. to 1+ am'ee uTjo,tl y ,.' '- '*

'

. . -

. 'h-'-' '*'

., . ro. k J .,''.- ' - . ' ' fbe to l)e a full m emY r. Next, mémbegj df 'SCCBU wïil' l cpen a depolj-lt. acctyln' (... .

'

4 jm e l1R' I'S , . . .. '. . '. w I . '2 . ; . .. . . . J . . . -. . . < . : 1. : - ; -. . . . . ..j. . . . . . . . . . , ; q . . . . . . . . j . . . g

'

) . . g x z y .y . ..cvg.. )Shn. re'- hp .ldefsiBrill. shaiq. dividehch.at thexbnd-of -.th, .. ez y'eanâfl. 'd - plbfit zinàfket-.ln- l'erdstk.f-zte .ftm th'e:itr.x-x%-wsz. .r ?' . j . . àdepojits

. A legal ownersltip of SCCBU will bè 'tlingfelïed io berïeficiary rhefnl'xrs of the ' r:l . '*' -. .. . ; . . :. ..j ' ' . ' bl z. . . , . , '*' ' . . .

: . '

com munity, Re 'netk innes, who are full m çmbèrj''-in SC CB 'U, will ,eliect one mpresentative 'nnd . /,

decide on how the system will lx managed. M 6!t11. . bers wll' l agree on an om rà-tion nnd . ,f

malntenancék feo to lx collected by their reprèjentàtikèFfur the teturyznt cost of oprfatizfg fu' :1 ..:,and maintenasnce of the inication svstems. M ooeratör 'to be eledted bv Dröl& t t+ neficianès. sr ,..

. . I *-- -e *' ' -- 2k -' - .-.,will be fully trained nnd s'um lwised by FI .q.

l ' ' ' ' ' . ' . 57 ' -' ' f' -t' -i4.3.10n e will provide the neces bàck-stoyp. ing and will l7e resm asible for credit ,s ;.. ...)L

...g bj y

. 1. . 4. . 1F

mjj, . p x.. J !%

. . ' ', . zz-s . llt'r.x .' n .'. . . .-- ird' korxc - . . .:- .<' a.... . ,)t è .x. . - . .....2.s .. w..- p ..w -:,, - u.-k.*iœu

adm inistration and m anagem ent including group assessment and credit recovelies. The creditline will be available for prœ urement of treadle and m otorized pumps as well as focdprocessing equipm ent. To promote private sector activities, farm ers q'ill have access to thecredit facility to establish seed m ultiplication urtits, fruit tree nurseries, honiculm ral nurseries,fish fanns, livestock production and to purchase oxen drawn cans alnd sm all trucks. Establishedyouth groups and clubs w ill be eligible to access the credit line for constnlction of workshopsfor the m aintenance and repairs of the inigation pumps. Credit also w ill be provided forcoflstruction of village-level storage' facilities. Beneficia:y fanners w ill have access to credit to

purchase fann inputs and any other project related' income geneoting activity in addition tomotorcyclefbicycle for FI -q exterlsionists. Project beneficiaries Fill be required to repay theloan to the M F1 through its Fcs or SCCBU or cooperatives within 12-18 m onrhs after receipt ofthe irrigation equipment. The M Fl will ensure over 90% repayment rate for continuedom rutiofks of credit facilities.

(C) Establishment of Small-scale Ilqication Schemes

4.3. 11 For the purpose of sustainability, the project is designed to esmblish simple irrigationpractices. Selection of the appropriate inigation technique is based on the lœ ation and source ofwater. Five inigation patterns are proposed under the project to promote irrigated agriculture inthe four ADDS selected for this project as follows:

4.3.12 Treadle pllmps: Project beneficiary will be provided with treadle pumps on credit tosen'e an area of 0.3 hectare on average in areas with shallow ground-waters. Pm icipatingfarm ers w ill undertake the excavation of dug wells, construction of the wellhead protection.land prepnmtion, and on-fann water distribution network on thei.r resilective ploz. A11participating fanners w ill be required to com plete their farm prepnrntion Y fore receiving thqirpum ps.

4.3.13 Smamm otorized pllm ps for surface water: In schemes %,111 m rennial rivers, farmersgroups will lx provided with small-m otorized on credit. One pllm p is exlx cte to sen'e an are.aof 3 ha. Each scheme will be served by a m ain distribution cnnnl that abstructs h'ater dirx tlyfrom the livers. Farmers will t)e resporksible for the cons% ction of the irrigation and drainagediM bution systems. n e m ain distribution cnnnls will be served by a large m otorize.d pum p tolift water from the river, while the sm all farms will be served w ith sm all-m otorizez pum ps. n eteniary cnnnls, and infield drainage network.s wiil be designed by cortsultantts) and corkstructedby tl-ained farm ers to enolre serkse of ownership.4.3.14Rehabilitation olr 25 earth dnm q: A total of 25 eanh dnm q will h-) rehabilitated forirrigatiop pu> ses. .som ç of these dam s are heavily Filted and som e feedinq srrenm s are larqelv

. r- . - - ' .. . - .. . ' - ' -. *' - . *-* ' ''' ' *-M ' * *# : --L:act.z..-=i.hl(Nked.. .:rFitl)=!v.p*--z1.s....;.n e sspillWays' of r'somé? of:.the--dnmq., will --also m 'e.e.fl urel:labiliLz'ttibœ:ztEöè...: ,..L:::i,J:.,).-z 7

dournstream irrigation, m Y well will be relied on for irrigation. M otorized pum ps will extructwater from the mbewells to M gate the areas dowastream . n e spillw ay ditches will lxzreM bilitated nnd lined by con% ctors and a network of field nnnnls will lx coastructed bytrained farmers to die bute water by gravity to irligate fanners ploz. X neficiary farmers willlx tI-ZJIM to participate in m rform ing the necessary land prepm tion. Lzgal onrnersllip of tlaerellabilitated dnm q will te transferred to the Y neficiaries in the com m unity who will asqllme them aintenance of the dnm K.

. - . - --v-.- .- r m- .z. .e . .. . ..as- . .- , ' ' n y t.< yk'A-'.q. r''w'yr *''v- àJ . . . . ;NV ' -7NR v-p'w- : 5' . . .(vr- . . . '

, .. . , ' , .

' ,

.

: . ....,.'-51111..''!j!

' j. 7 j

.. ' ''' iil

14 . '-1'$

. . J

- kler irrigation schem est Splinkl- er irrigation u'ill l7e established f'.4.3. lsEstablislwnent of sprln jl k . . !.,.,kr

at selected sche'mes with an area 15 heèures (e :g.. T'émbwe) using groundurater. Sp - er . à;. lp) . . ...'

. . . cirrigation is generally adaptable to m any crops and soitlB: uBenefi iciaries witl 1ya trained to' ope. rate , .d aintdin tlle sp ' - er system s. . ë.'f ''D m

'.. j

. . . . !' ' ; r

. >' 1.

4.3. 16. Sm'al. l-motorized pum ps for groundwater' exqtrqction in De dpln: in : ln areas with vast )s'. . l . . . . . . . . . . l

floeplain, xt-tulbe 'wells will be sunk for small. motorized pumps of .5 horsevmwer, to extrnct jgroundwate,sr for H igation. One pump wi.ll il'r. .igaxtè t'hté. e hectafes'and will sen'e ab' out 9 to 10 't'.'

. . ' * ' 'y/farm ers

. Tlle mY wells wlll be corlstructed initiâll'y iky, b-ef1' œactors zand evenn 1.m11),, farmers .will . ,î , . . îuv

. ''

,' .. ' s .

tye trained on how to cortstruct these tu bew'' è'l1.s,' .tlqo#infi, el:d' itrig4- tion. c-n. nn.. ls and dlrais. 'age , .1 .2 jj yageu stp, c. :, such flood-plain s a.re river , , :1:systems

. No pe rm anent distribution eanals willlbe. enco . .l - .

.

n . js covides th e d, iatags. ' ..,,'channels which are s'ublect to denudation durinx thewraliirly, seàson. ex p.

. ) - '.''-' - . . ..of the prolect area and the corresponding inigation. paftzrns. j

. f:1(D) Esmblishment of M ark-etinc Structtlre ' , .,

. . ..2 . q.

4.3. 17 The m ark-eting of horticulmral produce is central to ' im p. roving farm è.rs' incofne. n e .

-

.:. 1 ' . . .. ' î . .

prolect wil.l p'rovjde marketing depoz and Col1'é' ction ?C,'. èuters (CC' s) in the prolet aréàs. Fôur. . e. j ys .yj . .. ' . ; . . jM arket depot

-s to handle horticulturàl prod' uce 'antil..,fl,),e.k d ,o. p ps wll'1' zt<' establish. ed , one in eéch .1 ': ' t '2j' . . . . . ' . k ' * . . ..j . . . . 1. .' A DD

. The dep, ots will have a wholesale matrketyssg,t..âvdtK,gk.to d. p mat.ka. g 'in' g faoilities, ân. . d a cold ,1 i lm ral produce for a f'ew dh'ray.xg..l :,C. C'ds' ' w' :i.11 the estabilqislq' H., néarer' to .the ..,. jiroom that can store hort cu ,l ': 1 è. ' ' '

. ' '>' l, producers. n e project will provide materials for Longtms. ;. tion ef th.e CCs. M, emY rs, ö'f,/E. Cs .or ' I. j iyyky, . . ., , . o. v pjj jSCCBU w ill select smategic lx atiors and provid 'è lébatiy

.for cohgtm cttion of t11 er C C .j. F à4:nA, . çrs t 'l . p ' , :.r. (j . x-tlraucyj, cart.s .to . . , f .,

'' '

tNoart.>' qtlt è- ir . . . ' .group s will be .provided with credit to Durchage yehi' 41

-e1 an f)l .

ak . . . ' .- ? ' ,.

. . . ... ., . y; : .. , ,:

pre uce to the collection centers or the m ain depots. . F.-q. k'-d.li'''m... arket d. .e;xE t. wtill le m'nbn, .n.r:û.'H. 3 '.b v. .' a . ,.t ,l *' 'ë .. ' ,.. N; K* ti : ' œ . *- , -. ;

M arkttirm B onrd .(I ) . M embers of the' ' ' .:B/ $#a' .;il!' bù teltettbd frgm tlie SCCBU. s h'iiktll. t 'w. w j * e ' ' ; , ' . ,. e

representatives f'r 'Om plnnning and m arketing divisioH' '' têf M OM , M inistry of Conlm erke' .and ' fêj ' . .Export Promotion Collncil (MEPC).

. ,3. ' . JJ

4.3.18 A Centml M arketing Board (CMB) will alsosbe' e.ttaiblished' 1.1'1' Lilonig'we to cœ rd. .l'.nn'.te .th. e '.kj ,. . .q. . y x . . . . . .,.m arketing activities lx ally, regionaily and at irit'eln'hétté-ltn-iè.l. . levelg. q'he p. rp Jed w ilkl. tE'c. niit g,n ' .

yl .. - ' . . . ' . . rji

t international Technlcal Assistmnce with ekpertise ein maytkuétihg: ' to ' ge' , 1-4 'e as. the ..m. a nnjer for th e ' ,. j - , , . . . v y zjr . ... y

, m arkètirm comx, nent. The TA will set uo a mafketilœ- 'iinf* ' 0:.t1:14. ' atiron lllteillifence svstem a:4d..Wi1l '' ' .j' '*-'' '*- t ' ''K . ' . *-'' '' '- ' -- . 'h'''''' . ''#' .

liaise ' with t14 e c. PC to explore expott m amke. tr. eppàbk,tiutkni. 'ties , fier pioiect rlx. -r1*9. èinries . To ''?,I ,< :* . - j 'L zt''. J . l 2. 21 *' . ' ' ''. A,

. oromote the oriva 'te sector, marketilm agen? W' ill 'b: alll'ebtè>d. m atkytid. g K1tnr knt'lq kq lt th . e' delp'. ts. on . :' A' '*. j '''-'- ' . , , y j . . : ,. ' jrental basis. These agenz will facilitate the l'lnknge, bètweetn prcdû' cers .arvi' 111' ppliel by !purchasing the pre uce from farmers on whole sàlti Ivsjs or by scrrôwi,n' g on de.,tI1.' àn' d fgr è-xm l't . ;*', j . . y y . , , . . , . s uew ts

. . , ).... . -. m qrkel. The, 'Govemment will Drovide the land.. tö be usé.d fot cbn. An'. s ..lc1îo. r'1 of m.'. ar-ket q.- .. : . . . - . . ' . . . ' -- .. .- 2 ' -' . . . ..' j . . : . * y au . . . . . ' . .< - - . (7 - . . -.- - . - ----. . . jj. - y . . ;.jj.J''u .:(.'ct7=-..'..- .-.tnnd .t2o. lleètioi-7centèfs. 'E-.@.iI1 .-relevant-'- EPAS. . ofar-th i è-vlp' röjètjb7éreà.i . ..s7=' ' . 1 '-: ' 1.>.îl.1, ' '- -1+- ' '-t .:eta.'- . .' i L'i. à'%L' a,z',lt')ktl f?.=.=>' ;: :ï:: -

conditioll.. .f ' . . . -

'

.j 1.. : ,

. ' . . '

. ' e . k4.3.19 M arketihe and FoY Processine Studies: A mark-etirze sêtldv tb exp lord reéionn, 1 p

. - $. - - * *-''' : '.' '*' . *-''' '' marketing. po' tentixlities will lx conducted imm ed igte. ly'h'taifter#r'l' b'ânx.EefTmztiven. ess b y' a co'nmlltàncy , 'tl

. . ' I ' . ' . ... .? t. . j s . .' . z . - . ' ''t#1al I zecl. ' ç in mnrketing studies . The ',.e. on-m.. '.'l.

'li.tn' rn'zcy' ,ï flûrm. . . will. &. '. it. duet ln < 1e:). .te,-d.' .reeionn' .1' l 'T'4* 7 . . *-'- ' ' lcountries a bffqe li 'ne survey and marketinc sttldv v,to' D'tllwlzdl e a htar' ' kétirm inf o'rmT ' ation syq'r. 'em, rregional exx n x terltialities and provide a better 5% setsid' ' ent o

- w A l - , . ,

n ' .

'

Anndnrd qllallty of hortkulm ral produce. 'rhe smdy will aéj:ijt' the m arkenng ofiq ce to K t-up an .4(j

f

:',i.

. . . tr'?.

' . : . . .. .j 2, 4' - ' .

'' ' ' .-v:,. ---. ...u..x.o - ',. .-. u'uiz'-.ux--u' . '':'''.--hu-.k.-'.-'/''ï*'=;o . . .-' ..

' '' ' . ' a- - . '.'.---t ' -. .'. '---.-?- -1,:---z2--, -

' * . jw =a . .

export strategy in the regional countries. ln addition, a food processing sm d )' u'ill also L'econducted to deten'aine appropriate sm all-scale food processing equipm ent u'hich vvould besufticient for the agriculmral and food produce in order to suppon m icro entelnprises sub-sew-:orin 5 'lalawi. The sm dy will include m arket plices as well as technical and financial viability f0rdifferent types of food prœ essing equipment.

4.3.201t is proposed that the managément of the market will t)e tendered to the private swawzlorafler project year three on rentâl basis. The modalities of the management of the market deN tswill be agreed upon betw een the Govenunent and private sector.

(E) Proiect M anagement

4.3.21 n e project will be implemented within the existing instimlional framework of theM inistry of Agliculmre and lrrigation. The staff of D O1, D OCP w ill lx trained in irrigation,honiculmre, and mnnagement technology to implement the project at the ADD levels throughTAF resources. A project mnnngement office will be esublished at Lilongwe and headed by alœ ally recnzited m nnnger who will the assisted by a qtzalified accounrnnt and a m anagerM sistnnt. A Technical Assistnnt, m arketing expert, w ill the recruited to m nnnge the m arketing

component. n e TA will le assisted by two nationally recnzited project countemnrrq. Two civilengineers, one honiculturist. one environm entalist and one PRA exm rt w ill lx recruited. n ecivil engineers w ill initiate and supelwise civil work activities related to the s'm nllscale irrigationand m arketing infrastnlcture. The envirormnental and PRA slxxcialiuq w ill lx recnlited tostzm rvise the training and exterksion activities. Other shon tenn technical cön-qulrnnts w ill t)erequired for the irrigation civil work.

4.4 Project Assamzptiorts and Rislcs

4.4.1 n e project design is bmsed on some asstlmptioas: 1) the credit facility for projxtY neficiaries will te at m arket interest rates. It has % en assum ed tllat the m œ harlism to lxprovided under the project for credit will ensure 'that the vulnerable groups. smallholders,women fanners and the youth will have access to credit. 2) tlae establishment of on-fnrm rmnalqfor water disebution, drainage and dam rehabilimtion will lx undertaken by p/ojxtY neficiaries. The im plem entation of thiq simple civil work will lx3 accornplishM if fanners areresporlsive to provide labor for construction of on-farm cmnnls in t11eh- reslv tive fielcls.

However, intre ucing FCs, SCCBU to l)e owned and mnnnged by projxt Y neficinries with h111nrvl legal memY rsllip will conf'lrm their pm icipation and reduce rhiq risk. 3) the rx')navailability of market outlets for farmers in the project is another .qhorwoming to the projct. IthnA % en asskuned that thç provision for çonstruction of marketing dem ts and ce ction cerlters

. . . . j- . ''' : : - ' ' . 2 . . . . .:..Ju ..:u -.:è .,.in...-Q+.uJpIpjm9.:afea. zMQl:-oVemomù...thlK&=%.W 1t;,:4) : It:..is 'also .nmqtzmed thnt: i.i'z . pfobabiliiy' ,tnfz'.'=ki : .'

arnught w ill the low .

4.4.2 The inadequate adminim tive sktll' s at DOI which is required for projmt mnnngement isa risk for the project implementation. The intrY uction of AMTA'S M inina pro.zranune for- A w .

prœ urement, finnncial rem ning and auditing of the project wtll' scen-schen the admini= ri. vecapacity of DOI staff.

F . g irY-v r.7 p rw'v 'v v''-v . .. n. - xvx . v.wv'r%''! ''7Pr*':47'FC!-' . : ' ' . .. * . 'r' ' ar . ; . . .,' . ' . ' ' .h .. r'''P : ' ' ' '! . <e

$. .a - j

. .J. t., j16 ' .. '

' . .Z.

' 1 . Nr.1:.

' .? '.'' :!J?

j. .!j j. - i

,.jj4 . 5 1N. -o 1. ec t C o .st . !'

. .u o .... =..à>' n y.

'e. * . . . .

'

gg . . . hie.. 4.;4:The total cost of the proiect -mcludinz phvsicttl and r),r4. ce coptm terlcles ls estunated at L A ' ''k -

9 .67 mllli on (hIK on 43 47 n1i 11 ion) . 'Fhe foreign excht' yfg siz .6 'component is UA 5 75 m 1- l lion (At .-fK ' ' .*2. * . * ' .. .

. !) . .: . . , 'c . .. , . , . .L h: !424144? 04 24 mi 11 1 o n) 1 e 59 Co of the to tal p' roj cct cos' t . U ih' ' . 3 . 9 2 at .' 1 1 on (Xz 'fK 1 3 9 '9108 mi 11 1- on) 1- e ' .16 '41 tz'zs of the total project cost >*111 t)e in local cun 'e,vrllcy. ' .' P ' hysical çontm' eencies -have been. a'p p lied . -*-.to all civil works- at 10 To and for procurement of 7 'qzqtzipment nru-l tools at o- 7- Pritle '' ' , 'f . - .. L,... . ct? .e .

. ,, .?èbb. ;. . . 1 . . . . , ,..

'

c-e . . s, . . . ,1 ..:%contlngencles have been applled to all cost ..ltems a. t a.n. ) a. lm. ual. l'ate of 2 .,o zc cqmpoundédo wl'1u,i ch ; '.. .. .. . ., ., , ' ( ! it . .. . : .. . . . ..

jkls based on the m ost recent estlm ates of prolectqd lnctea:e'é: m the wrorld cornm um ty pn. ces. . ..

:A lthouch a11 pn'ces were costed at loca' l curre'th t pno'c. dt' s the w orld pn-ces were used a.s th, e '...$'%.N..< !h j . p . Th ) rujrœ '. 1 . . . .. n uy'

.

' ''.!k . ' ' .' + . . .. L

njvt. ;yg.prcyect cost ls' ealculated ln UA whlch wll1: offset ap, y posslble fumre local étlen: . C .osl,. . .

' I . . . . . . .z;. . . . . s. . . ;! ..

estlm ate. s byv. comm nent surnm nnzed m T able,; 4.. 1. .are '.b.' a's. xed. on p? ,nt 4 s preNreall.mg and ctynt-' trm ed, ... 1 .

' .

' '' . . -- ' '

. --

., '' -œ-'

. -.iL jj'

ln Septem ber 199, 8 . Prolect cost by category. of e'xpe.ad.

' '.ltu,'rè ls stl . ,. nrlzazl, m Table 4.2. . . ',',

. .

. aj. . . .j. ''; '4 6 Sourcu of Finznce . ' L .s

. . ej- > '. ' evx

'

i

4.6. 1 The ,, finnncm- g plan of the project is sum: marized rï m- t-a'b. le j4 .3 l:heqlow-e'. Th. ve .' F loan of %' %* . 1 . ' , .' .. r . ' . ' < 's . . *'. . . I . @ ' ' .' : ( ' ' ' . ,.&

'

'X/.. . *. '/.. .UA 6.23 mtlllon wtll finance 76 Vo of the forelqn exeh, .àiI1. ''qo.'e cosz :. stlmatedp a,t U A 4..04. . ..:m.. llilon , . éz.: j . K-.' . ' g ''w ttk -'. % #' *-#', - ' v . . ' R- ' . *. ;,. .

, and p art of t17. e l 'i cosz nmountm' g to UA 1. 8- 9 .m:igll,l:gn' 1 .e. 20 C'o;. tyf. the tota, l project cgst.. 'rh'. . e ,. 'A' T wi l'l fi nai' 'n 'ce 13 % of the total cosz for 1 n sti ttt't'lë 'o- ,lqa. 1 .and: ?tech ni cal caoaci tv b. uu11-, d m- kc' , wcl'u' ''- oh- . . . ':' ptt t

' ' ' ' - - g t.ra i n 1- n g m' jrn' - (y a t 1 o n. and N 'hr'. U kl4 i c. u ltu . .rn.1. ' tec ln n o. . 1 *,. ei e s n ' nd m ark e ttltlil' cq . r ' ' . J. ';

WI.II mclude' Dr ,OV1S1On O ... . , , . . . . ,.

'.. tK hnlnues. . co 'nb-ultnnts. technlcal asslstance . . stu- d. rle...s'' às l'.weil.'1 Ju. ' th e' p rm -1.s 'lon. of ev. .so. '11.

'' ...; '. tiyr,. .œ

'

' v .. F '' . : . ' ' .1 ; !y . . ' w . z x x. . . x. ' . . œe s ..'ater and water tlow m easun'nG equipm ent and of' 'fice e'q uipm e n't. R-h.'.' e -. : verrnm ent. will zfinan. zt'ï ' :. .4N.V ' : Qp . . . < . .. . ' : ' '. , , . %. . . . $1). . . . eUA 1 (X) million of the total project costs which w ,t7 1 m' clu. de . vernment staff salaries l-enrnl 'u '?'' * . . . : . . ''

. I . ' . ' 'cost for the PM. 10 offices. the land and dèsiari worlusc for cohsktnzction of markcettadepo Ls gn' d '' ' 'a;

I ' m--'- ' '' .. . . ' T' ; . . . . . . . . A. -' 7r).

sinries of som 'e off-camous orofessors who .4t'11 h:1,, .t 'çeach' at N '-R'' C w ne lcallv. 'n e , Droieot, ..... ... I .A. *. '' . ' L ' ' . ' A. ' ' . . - '*. u ' .z.,beneflci nn- es w1-11 contn-bute about 6 . 3 % .of th, .ç to tal $ lro .1..- ect cosd by provi d .m-. g l'é. bo. utr work wkfo. f . ' '-''

- I . . - : , , . sg+g- jjj orzju ojes .for '' '. ' d i.'e' . purnp ',é' . ;Th'. k.. r ''e Ir- toTri'l .', î. 'ic.'cortstructlon o'f on-farm u'neatlon canals and. . dlgg. im. g.. .rr@.zj,s , : . , , , . , . k. -J' conûibuti on wll' 11 n m ount to UA 0 . 60 m l7 l'ion . 1-?14 d

.

'

,'''kM, 'kî: 0, A.1'C . . , sta. ff ' wtll' lx'z' x fit. fr'. o m th, . e 2J?..1.ra.-q., cly ' .

'

t. j . . . y . sy... . , 1 . . . . . ,

.. . . %jxextstmg. JICA s tralnlno proo m m term s of .c .q' = w . ' ..(2

. . : . .. .'..!! ;:

. ?':kA $T ab 1 e 4 . 1 ' . . . z -.

YNa'

p

'

k ' ''*

. . . . x. j . . ' ..>Summ of Pro ect. Cost Fwstlm aler.s. b, y C. .. .om . nent , x . .ï'

. .t' . . . '

' kI . ' w. . . ,CorizN nen'z I1rILMK. 'M 'i.lll'iplil . ' k ' (1n U-Ylfilitjbn) K. F.E ,:5,*. ..

' i ... . . . . j . . . r.. .- -- . .:-. ,..-g. ...-.- -- .m ..- . .

.:. . :..- -i . . :u .- . ., so. -..i ,.i .. ., -s(jc..â. j, .. ., .:s vt, ok tcl. ... ..- t-so--fe-i-gn -

' -c--1 c.,w.=-ql.v-u '.

' . '--..-To-;.y.it ' '- ' :: - '' i:.i'' ' '' 7'-. $'.' ' ' ' - u . . . . -. . . . . . : . . ('r. g . . . ... . .y ;,;#. ... . . .. .- . . .. . - .. .: -. . . - : . , c .- : .. ., : y , . a .c L.u y w.<y sm ga...y oj x m . . j ua =. ..#. .u.r... . ...s.....m...:..-y jg ; -. .. y .,.2 smgra av#m---ww . u..o .-=n=- C...L-CkJJ=:- .=.-.JJ''a'=.Qk..v- .24 .J=.-=.t=..i. V Q:LJ,k-J'if sQc?=...i1=.x. . :. '.: r - èL - ..z- . . . . . g. -c sts - ' - ct/sx ' 'œ . . - ' ee ' . - - ' '- q ''EkEhahge Costl ' CosB Excuhc (7 k.

. .- ' a 'J . . : u . . -- . . . , - . .

.-;

'

li

d

'. .

'

.

'

.

'

,. '' .. .,'

,..

'

..

'

A. Capaciry Builcine and Traininc 4 5.82 17.40 . 63' ..22 l -29 0.49. 1 .78 72.6 .. ..*. . ''''' j ''''' . . . , , .B. Rural M icrosFinance Syslem 57.19 24.15 8$-34 ! -61 0.68 2.29 70.3 < ' j

. . 1 . . . . t ;:. )C . Small-scale 1. rricalion Schemes 40.49 36.23 $1 .'6.72 l .14 1 -02 2- l 6 52-9 , .' ,*- .

D Estab. of a s'Lfirketinlg Strucmre 28.0 6 17.40 . '.t4.5.4' 6 k -.:' 0 79 .0.4 9. .1.-28 ' .6l .6 ' .'; ., . . - .

, . . :, , Jl . ,'

.E . Prolept M. ânaa. ge. na. enj 1 0.66 29 . l 3. it'l, /,9...7. v9. . ' 4.30 . . O .82. . 1 - l.. 2 .,.1, , 27 .3o ..i ' ,. , . ... : . ' ' ' h j J'.. '.. q ' . '' ' .

' Tot-al Base COS'I 1 82.22 1.24 .3 1 . ' 3'0. 6.53 5. 1 3 ' 3 .50 8 .63 ' '< 5'9 .4 ' ' ' ... s . ;b . . . .j.'' Physical ConLingeno' l 0.30. 6.*5 . 17' .'05 0 .29 0 . 1 9 ' 0.4 8 ', ' . CX) z9C . . o. ;'

. ' '' ' 't 1 * '' Price Contingency 1 1 .72 8.17 19.89 0.33 O T- A 0-56 58,9 .'2 'x'''. ' 'A l - 7 *' .ir

, . 6/: .. -J(* sv

:1t-,-Ijr$'m.. w ,ï.'. z 'A

- .

.

.

.,- j

. . .. . . . . . j+?., . . . e.' . . ,.g ' )u!. ' xjk.' jj '' .jsjl wau % . T.eFz'Qk$(, ' y * . wu :ro .., x 'au.' o o. u.) .a..u J. b. J ....za Z?.Q%'... .( . -*. . . i ... . . .. . .= . 7..:,. . - . . .:rz ki. ., ..u , .' .... . - . . ..'-.s.==-'*.e .?i . i.=.k..ri! :xi x. ,2. . '' ... ..e? .&.'v ... ,x x . a ,.

W r*7 .. ' < > .

Total Project Cost 204.24 l 39.23 343.47 5.75 l 3.92 I 9.67 60.0Table 4.2

Surnm of Pro'ect Cost b Cateco , of Ex enditure

Category of Expenditure (In MK M illion) (In UA M illion) % F.E.

Foreign Local Total Foreign Local TotalExchange C6sts Costs Exchange Costs Costs

l . Goods and Equipment 19.89 4.26 24. 15 0.56 0. 12 0.68 82 '2. Credit for Goods & Equipment 46.53 10.30 56.83 1 .31 0.29 1 .60 823. Civil W orks 46.53 17.05 63.58 1 .31 0.48 l .79 734. Training and Studies 13.85 9.23 23.08 0.39 0.26 0.65 605. Technical Assistance tl-,ocall 0.00 4.62 4.62 . 0.00 0. 13 0.13 00 '6. TA & Consultancy Senrices (Int'l) 22.73 0.00 22.73 0.64 0.00 0.64 l007. Far'm Inputs and Local M aterial 10.66 18. 1 1 28.77 0.30 0.51 0.81 378. O peration & M aintenance 22.03 9.59 31 .62 0.62 0.27 0.89 709. G ovem mcnt 0.00 31 .97 31 .97 0.00 0.90 0.90 0010. Benesciaries 0.00 19. 18 19. l 8 0.00 0.54 0.54 00

Total Base Cost 182.22 124.31 306.53 5.13 3.50 8.63 59.4Physical Contingency 10.30 6.75 17.05 0.29 0. 19 0.48 60.0Pric,e Contingency 1 1 .72 8. 17 19.89 0.33 0.23 0.56 58.9

Total Project Cost 204.24 139.23 343.47 5.75 3.92 9.67 60.0

overseas % ining and volunteers technical assistance through the Governm ent chnnnels. Thetota.l cost of this training is UA 0.58 rnillion. Submission of a r ining request to JICA w111 lxretained as a loan condition.

4.6.2 n e contribution of ADF resources to the flnancing of 1cG costs Ls jtzstified by the factthat the country's econom y hnK s'uffered setbacks 'as a result of recurrent droughts during partsof 1980s and 1990s. 'Fhe Govenlm ent is not in a position to m obilize adequate 1cr.a1 resources tom eet the developm enml resource needs. However, G overnm ent is m aking effons to revimlizethe economy through a series of econonlic reform s. 'Ihis Ls contirmed by the fact that M alawihaK rem ained comm itled to the implem entation of the m acrtxconorrlic nrvl stnzctural reformsinitiated since the 1980s. M a result of successful implem entation of these programm es, the

Government reached an agreement with the IMF for an Enhanced 'Stnzcttzral Adjus% entFacility in support of a medium-tenn reform programm e covering the lxl'icKl 1996/97-1998/99.The external assistance received is predominantly used for finnncing the foreir exchange cost.In addition, tàe nature of the project is such that a significant m nion

. . :'''..( . 7 . . ' .w. r. - .- '' . . . .-. .:.u j js - . .. . - . - - ' j. . . - . ...- ..... ' : ' ' L . . . .. LL . . ' . . g. .. . - . - - u(. .. .. - .s . L . ' k . ay.) .,:j j ï. ' .t - . g y (. ay . y ..- g .(..... . . .. j. . :z;.a.. . . ..a g:.rs . y. . . . : ,') j y.. a' .' . . ... j... (.zy .. ..:. ypy . .. .

. . . .-.L- ==-c..- é..c-- . . Z'U.-L..L(L .7.:'t -.f ..ï t =lE'Lu - ..-i:f . u'- .:( . -.c... -.-L=L'z. .:'7. r',-.-L.( n:..l z.,.z:-::.f .-L-.' - 't.-..J..u:-' -. z 2-c - - = . . -. . -

Table à.j

Sources of Finance (ln UA M illion)Source Foreign Im ml Costs Total Costs % of Total

Exchange

ADF 4.34 1.89 6.23 64.4TA F 0.83 0.43 1.26 13.0Governmqnt 0.œ 1.œ 1.œ 10.3Beneficianes 0.00 0.* 0.* 6.3

. . 'rr < -rT . ,, . . ...:., . ... '=--trv--- ) ,.. ..: ,;. ... .

'

.'2 ' :'!''k , 11' * y'!

18 -- ,i. 21

. . . ,

1% JICA' 1 0.58 O .(K) j O .58 6 .0 o.s ,7. . . . . j. j . ' '

. . . . j,

TOTAL 1 5.75., .' 3.92 9.67 .1œ :. ,1'

' ion staff , credit for sinnple :*'.

'

j'*

1of requirements Ifor its imp lementa:ion - mainly, y. a-inïiflg of exterts girrigation equip 'm enta sim ple civil works to 17: im. .. pl-r.. m. ented 'by farm en , lx al m âtedals for :.'

w$j.'

' l . .)boreholes, cortstnlction of irligation facilities and h1il1.. e tt,4 ad. le pumps ca:ï lx'z pre ured lx ally. o'>: .. k .t'

. ' )

rtmental Impaas ', .'.4

. 7 E n <, r o. .- . :;j

ike with any other htzm an activity , irri. gatlj.. :u,;k, c'hem es generate a- 'num ber' csr im pacs, . ,t1,

4.7.1 1-' l . ë- . .. . -.- .

, :rthat need to 'be: identified and m itigated to impro.vé. tlt: sù' stalnnhilfity of the ptolect. De@. ite the: .4, .I œ ;r i . , .', . . -r: - ilarge surface area involved

, it has % en deterni' ined.t ,th' uaf-â 1. 11 ettvëifrodm entnl im pact 'asK ssm elt t v '.,::, . . , . . .. : . ,

. , . j.is not warranted in view of the low teclmology i'izi.g.éitxi/'n me, thtxl' s being employed, t11, ' e nlral, 3)

. :, . . . ,; a .. . ' s .;focus and the exm rience already acquired in the d. ::, i,.:, h>.. tand m'xnn. gem ent of su' ch prolecs. ..j' ' Gtngement Aet in . folce itn s'4alawi, a '.h,iHowever, in accordance with the Environmental M .n $ . .1

) s . ! j. , , T ., . '.. . . a . .' n,num ber of the sltes identified for H igation schem es. àrfe, suty kéct tîj m andatoo' Environm ental . ..,

l . - . ' -.. ' - ' ' ' .Im pact Assessmont. As such, the project will be 'xskbjetlttxed tb a fu11 nationnl ' pree. ss. wkich ., .;,

. 1 . - .; t t . ' ' . ' . .will lmprove the progect ql.lnlity by esmblishiplg ak. E- ad t'qllllnte' environm ental bmselirz hthnt. w ill ' k.' . t. j . yy. . . a . y. . . y .

a, .

. . ,j. sy tjyy ,;jyeventually help in the m onitoring and m nnngem e:nt of tlk'. e prolect.

% 'k ' > '.- r--jl .;r@. ' Y

'

'. .4.7.2 An mssessm ent of the potential lmo. âcts. th, eir lik' elihoY' to irrm à. ct and the ' .r < A. . A. '' L . . a ' . . . . . . k

'

. . 'A. . .j . . . . . > . .: e'' 'g.q . 4. : X . ' . '! 'corsequ ences of such impacz on the environm. ent'a' 18, êeze.. . p. tors, 'h. aq determ'. ç Il.n,ttd a range of s

m itigatiön m emsures that need to be applièd, n .k'g.e )i>.c'..l.t1d : 'thxleWprotection of th e 'riv'e't mserv es, '.'

q s .. t . . . . ! . ..1 f retention ponds to trap up'strka'm tau. 't ljefore the river enters tlle' dnm. , tlze )', 'tlne corstruction oj

r .)) . j. t jg . . . , ..,

protection of dam and cnnal embankments with .:,4. getâ. Sji'(j'-p, th .e 1113a,1.11. .xten.apce ao.f. a m lnlmt l1.m S.QW. .' j . a, . . ' . 4 ' : *.C a . ' . . . . 1 ' ' . ' rx'of water in the ,x rennlal rivers to orotect the bgreed 'ide km unds, qf m lm-atln.c ftsh, nnd a close z

. 7 ''*' I '*' . . . '

. ' ' *'b''' *-e ''''. '

. '.-'''' ' '*-''

. . . . .

m onitorinq of 'the aoolication of chem lcal fert. illz.ftrs af4. d x sticideg.. A com plete list of the i.'. x''- 1 '*' '* . ' *' '*' Oj .m ltiqatinc menmlre

-q is at ex 2. .,

11

*

.' ''

'

'' C'''C

S

''

.

'

''

'

4 8 Tmpad on W omen nnd Youth j. ' 7x. - '

4.8.1 Provision lnnq been m nde Ilnder the prop ct to address the trnlnlng and I'esource $. . . . :.. - , . - - . .

. : , . . ,1requirements of both women and the youth. n e W.' ' om... çn s P rogram Sec tion S ) and 111 e :jtI

.. 1k . . . t . . .. . . . . . . . p;p;Exterlsion Dèpa 'rrn' ent of the M OM , in collaborAtionr, ' '+,1.t11,

, selm êfvl. , N Gos, will idenlify, tràin ' i:,and assist wome 'n and youth groups to establish yfnnnf (,.@. t. clubs. 'Fhe fprm atiùri of > 0.. tzps A'ill .' 5'Drovide croup seeuritv and facilitate Y neticwinne.s' acc.è' .ss .to the credi; line under the prolr, t. lt j,!r '*' *''* '*' < . 1 . k, . ' ' , . . . .

. g

will also provtde tlle vehicle for collective bargaïn 1n, : pf in. put stmplies w13lle provlding a fœ t:s x,, . . ;;114:1 I.'.'''''' ,. ..,:..h. J' ' ''.'''. .

,; ' '' . '..''. ....:.%, .

''''' '.. .., ,.

point to facilitate tm inine nnd n'anqfer of research and extenà' 1on m dssdqes to ' ficia 'rfes. ':.. ' > *w- ' . ' ' v . 3 %> ' .' .

. . . . . . . lk ,.. A . . ' - . . - 7 l ' . . . ' ' 9 . ' ' . ..q ' c . - .. - - r .... . - . 2 . . - :.. .: . ' .

. ; ' C sk$. . . . ;. . . . . .- . $. . . .. ..... *'.. .* a . ' ''' . ;. ..:. . - .. < 6. ' J .1 l .

'

.. .. .'.., X.' ' . * '' ' ' ' 1 ' -' '. ' ''<'. '' ' ' *'. '-' ' e'' *' t ).4.8.2 Thé prölY t K'ill also direct itj effoM töWkds èa/ln. &- wom en j labour conO mts, a factor yRe

whkh affects the ability of women to cultivate èff-çetl'' 'vètly, b)r provid. ing credit for jma: 11 fn''rm .'(;. ; r 2

. . z,s. ljim plem ents for la'rvl preparation and ploughing. To prom ote private secto'r lnltj l'tives, :.11*. credit ' ::..1nent will 'Y m ade available for b0t.11 1.14 diyidu:. 1. .avnvd ocqoup activtties. Irwlividllnl women z pcomm

. .. 1 . '' . . ''-i .' . .. . . . . . . . ; .w ill hnve arre, ss to the credit s to purcha'se an. tl markst agrlc-ulmrn. .1 prcxl, uce f'rom the prol. m t ,: i. , . -,. , . , . . :

nnd for ptzrchav ftxxl prœ essors such as so. lar. ''( ' e'l z: krnwl. mpresx s, m nlza nirvl rice m lllq nnd -,groundnut cnzqhers. Funher, credit will be , prbyid.:d i to estàb' 'lished y014th 'groljps fbr 71he <:s

. j . .- . . . . - ;. . , . . 'conrn lctiop of wjorks- hops nrvl purc of sonie. spatè p arts,

for m . nrznêennrw-e antl 7. ' . of , j

treadle nnd m oto 'rizw l p lmps nnd s'prinkqer irritgtion sy' .s' e m q. Re activities w 111 ecn hq 'r=e-. tl)e '' 't

2.

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19

employment and income status of tlne project benetkiaries, especially u'kgmen and the youth.

4 .9 lnlpact on Poq'c?'tq' Reductioll

4.9. 1 The proposed project activities will complement the Government' objectives to incréa-evethe productivity on flood plainq b)r increM ing access. to water for horticultural and food cropspre uction for smallholder dozland farmers, mostly women who account for about 60% of thepoorest of smallholders. n e project will also assist in limiting and/or removing the constraintsrelated to increased prz uctivity, credit, food prodessing, storage facilities alnd marketing ofhorticulmral and food crops surplus. In addition, the non-panicipant poor in the project areawill also benefit indirectly from genemtion of project related employment as a result ofincrea-sed agricultural pre uction. n e activities to be implemented under the project will have apositive impact and thereby reduce poverty in the project area.

5. PROJECT D IPLESIENITATION

Executing Agency

n e Ministry of Agriculmre 'and lrrigation IMOAD will l:r the Executing Agency (EA).The M OM is headed by a M inister. The Principal Secreto is the administrative head and theAccountant General. In tllis capacity he coordinates the overall day to day activities of theM iniqtry. The Controller of Agricultural Services is the technical head of the M inistry and lnasthe overall responsibility for the implementation of agricultural projects 'and progranlmes inM alawi. The M OAI is divided into six depaM ents; A gricultural Research, AgriculturalExtension and Tm ining. Anim al Health and Industry, lrrigation and 1 nnd Resource andConservation. n ere is also a depaM ent of Finnnce, Ad'ministration and Persormel. n e FCNand Nutrition llnit deals with policies relating to food and nutrition and early warning complex.

5.2 Organization and s'Ianaeem ent

n e project's headquarters will lx ltxated within the irrigati8n deparcnent of the M O.Min Lilongwe in order to enmlre effective coordination and timely implemenGtion of the project.The Project Management Office (PMO) will be headed by a project mnnnger (PM ), who willrem n to the controller of M gation. Project M anager u'ill liaiw with reléted depanmenz ofMO-M inclgding NTRC, selected NGOs and MFI to coordinate project implementation. A( theADD levels the M&'E ovcers. in collaboration with the honiculture and M gation officel's, u'illcoordinate the projxt activities and report to the PM through the progrnmme mnnagers of theirres> tive ADDS. n e PM will be assisted by a qualified accountant. n.

e m arketing comm nentl u....4--. . sàvtlj .V .nïanaged. bjr.u.jn u internationnlly qllalit'ied-markethng'''exm n who w111 'Y ràssis'ted b#. 2two'Q..-. ..=

1(xa1 a-ssistants. Furthermore, the PM O will l>e supponed technir-qlly by two civil engineersr onehoniculturalist, one environmentalisq and one PM exm rt. .A1l tbe extension. FLS and S5fSstaff NViII be existing staff of DOI, DOCP, W PS of the M OM . The supm n staff will includeone r retary and two dlivers. n e office p ace for the PM O will lx2 provided by theGovernm ent. n e e-qmblislunent of the 'PM O at Lilongw e as well as the qualificatiorts nndexm rience of staff for PM O should lx acceptable to the Fund. Ther w ill lxa I'eL-tiJAH as a loancoM iuon.

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. )?5.3 Disbutsem ent

. . ' ;: . . .:.

5.3. 1 Tlne Govelrznent will om la a foreign exchange. denom îtkated account u'il.h the Resenre *'Ci. . . . j' ,Bank of 5 falawi in the nam e of the project

. An olj.gl'atine/s'p ecial account denominaLed in. $- -

v .. *---. - Ak

. . . ' . % ' . #Kwacha

, will be owned at the National Bank of Mal?awi (NTBMI wlzich has branchès in tlle . 7.

- . ' .

jproject areas. Funds for the credit component will. be .hè.kl-d' in. tlR' 'à Lil.ongwe account' to facilirlv, tç 7. 'tdruw ing of funds by the f'm ancial interm ediary .a'n. rd alse. facilitale. a pliitpcing of Lhé credit fu, .n.. ds . :

- . . m Y'' by the P5'1. F'unds for credit activities will ' be : d/jvn by the ftpan cial intennediary' ulxm. #? . ..'',-*,submission to th'e cornmercial bank, of. a list. .qf beneficiazie.s, the inténded activities and s!' ding n' mtolznt required

.

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con-espon. . - j. . ' .j. . . . . . '

...jj5.3.2 The accounz in the 4 A DDS - M zuzu, Kasungu, Salim a, aod LiloKmve w Bl lx -i

: x- . :$ c

replenished on a quarterly bmsis by transfer gf f'unodpsatrfr' öm th'...'e . foreign exc'hange ac. count . jconverted int.o K wacha at the prevailing ex. chrange' rate.'',I..'J) rger. proeurem ent will t)e p aid for by '.

',

dj . : . . ..? . :-rdirect m ethod of palrm ent. n e signatoriés of th. e account 1. Lil/ongwe will the, the Prolect $)

' M anager and the Prolect Accountant. At the ADD' lztèl'é, the . siastnatories will rbe the ADD s .' sj.

-- * ' ---' ' ' .'

4: .Programm e M anaaers, the lrli/ation Officer in charce of the relevant AD'DS and the ' jx.( h-'- h--e h-'e . .

, H oniculture Speckalist attached to the ADD . '.r. u jjy,

.. --!k5 4 Credl't Adm l-nl-qtration ' ;' :

. ' '2

,y5.4. 1 Provision is m ade under the prolect to allK g, te aM' .ut .

'

.2,6. m inion for the c're. it , . '! ',.component. A M icro-Finance Intermedia!y (MFI..) wzith, ' âgéncie. s in .'thç ' projœt area will lx .: 7

. . : .! ., . ; pt , f '7. '' ' - . ' -z' ,$;$ .recruited to adm mlKter and m nnnce the credit facrlltv .-.T' 'wo N .': ' s w ill also. lx recm ited for .) ' l --'''' e ' ., q-- ., . ': - ' ' ' ,: :.- e:kjform ation of farm er groups, group dynnm'ics and .t1F. âln.ltntg. of farfne. vs for credit. In collabtyration sd . . .

. j -. ''' . 4, ., , 'r . . , . . . y:,w ith the 1. the N GOs w tll select after tralnlnm oligible fnrm ! Br aem ups to acce. ss the credit .

: .. - j ''''- ' ''''' . .. ''''. . ,, . . . .,.' fund. ln thls conn ectioù, a11 the irrigation equipmknt .*i1' 1 '% Dum hgsed by the D O' 1 and hznded v).

. '*' ' ' 'h ;over to the M FI. Beneficiary farmers eligib le to' açcess'ttthe crerlr it l'ine will 1)e s'upplied with the ' ;

. ' -. . .'' irrigation equipment xhrough the M FI. ' 4

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' ' ' th as w ell as eligo l' e J?5.4.3 The credit facility will te extendH to està, blisk.pd farm er and 5 ou .

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individual pro' jeot M netkiaries. Credit w111 bè.: hprovided ' fo. r ge.--a.. ë 'aqon, 'n.1 an. . , d meditlm term , . '.1 )' . ' . . J* '' ' ' . ..-investments, including seasoaql inpuz, leadle , and. '' m, otonz. e-f1:: p.um p, &, & n. nkle r sysqom q, , .,:. ; ' ; ' .,'

establislzm ent ''of m ultiplication urlif-s and - frnt. l't qdrsenes, , ct'l.ns, 'fa ction o f works- nhops . fo'r t. '. . .

. . . . . . : . . ;k

l repairs and m ainte of irrization pllm ps, small farm . ,1m p, l'em en,ts. ' ; ' .rnar. ketin g of agnculnlrnl ,, .. . ' j %--' 2w. . 'v . . . . , . . ;,x s : . ..

prYuce, foM prv sxrs and any other prqect related ,1d èome genefxtihg activities. '1'

-d'. its fieldt staff. who whayse a .d. irveec. . .t rj p J-re.y rc. - . ' ..a..)'(1'j1. .5.4 .4 Jrhe Ioan rw-oj

- . very w ill lx enmlred by .-th. ..e. .. t,, ' . . nn:- . .z ,. . .p ..x .. aiu.. xomju . .yr.#. ssps. .j.a;y ...+;...,. ,. . . * '.- , . '''* . .. . - . - - . 7 - . . . . . . . . . . . . . . . . . . . . . . . . . .. L . . . . . );x. -.: =-G=- --z-ézzj-a'c.e . o'jtln . ga'jlr. -jyeyjejicjéj-j es -:11-12* tlnd'' tj om- '''m* - 1 ln. .1- ' =-=T1+.-V'1ffafV '- -* é 6V 'e ''f 7 ï ' é1? SO. ..'ï1LLL?3à;;''' ,-. , . ;?(1!r5E) :.$1::2:2. ... , .. . (L . . .7 - . ij

M nèficinries themselves tluou-eh peer pre:mre ,afld' sûrailp lia bility. 1%. tluq 5w of credit nck .

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. - ' l . ! , r , ju. xya. .q. to svoi' d , ,lx'z ink pe' naI 1- z.a'I: .. . fo r h,1. ttzrâ ' : '*n ey will lherefore enqalre thnt members repay 'their -

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5.5 Procurem ent of G oods. Nvorks and Sers-icu

5.5. 1 Procurem ent arrangem ents are suram arized in Table 5. 1 below . A 11 procurem ent ofgocd s, works and acquisition of coasulting sen?ices financed b)' the Bank w ill be in accordancew'ith the Bartk's Rules of Procedure for Procurement of Goods and W ork:s or. a-s appropriate.Rules of Procedure for the Use of Cortsulfnnz, using the relevant Bank Standard Biddin gjgœ umenté. .

5.5.2 M alawi's national procurement laws and regulatiorts have > en reviewed and detelm inedto be acceptable. The M OM is the Executing Agency. It has a Procurem ent Unit staffed byqualified personnel. It is conversant with Fund procurem ent rules and procedures. In addition.they will be tl-ained by AM TA progrnm provided by tlne project. Funher, the Bank Group urillconduct a workshop in prx urem ent and disbursem ent in Decem Y r 1998.

5.5.3 Cis'il W orks: Procurement of civil works for main inigation canals, totaling in aggregateat UA 0.77 million will be carried out under lnternational Comm titive Bidding ('ICB)prœ edures. Three of such contlucts will be awarded one for each of the areas of Salim a, 54m1m1and Kasungu ADDS. Procurement of civil works for the m arket depots valued about UA 0. 18m illion per con% ct will lye can-ied out through 1CB procedures. Four of such contracts will lxzawarded for the four A DDs: Lilongwe, Kasungu, M zuml, and Salima. Prœ urement of civilworks for mbewells. dnm rehabilitation, and drainage canals valued at less than UA 0. 10m illion per conr ct w ill be carried out under NCB procedures. Num enzs contraca will lx'tawarded and valued in aggregate at UA 0. 19, 0.28, and 0.31 m illion for each lccalityregv tively. The small values of the single contructs and as they are scattered around, Lheproject will not attruct intemational contractors. It should t)e noêed thnt these values include theconM bution of beneticialies in the form of labor work in kind totaling UA 0. 1 1a 0.08, and 0.07m illion for each locality reslxxctively. The benetk iaries will m ake their contzibutions aher thecivil works conr ctors have completed the work.

5.5.4 G x tls: Conlracts for vehicles and office equipm ent valued in aggregate at UA 0.68m illion will be awarded under lnternatiorlal Comm titive Bidding (7. CB) prtrM ures. Due to thei.rs'm all value and that they are off-the-shelf item s, the s'urvey and soil and w ater tlow m easuringequipment valued at UA 0.% m illion will be procured using NCB. n e tools and 1(0 -1mnterials needed for small civil works (on-farm cannls, irrigation dugwells nntq tuY wells, nrvlcollection centers for village marketing) are different in tjw , quantity and llqqge; valued at UA0.28 million will be prœured through National Shopping (NS). H gation equipment valued UA0. 19 million will l)e prœ ured through ICB. Small itrigation equipm ent totaling in aggregate UA0.90 m illion will l:e prœ tzred tzsing NCB. M érketing eqgipmenl value.d UA 0.88 m illion will lyz L- -- ' .: -. .. . .

. . . . . k ..'.:.- r :i. . . prx ured tlsing :Natiorual Shopping .INSI.. :as .theyr'iré diversifiM :and wlll 1x'z prœ urèdlby: '?.he . 'kcu.' .:'

xlected Non Governmentnl Organiz-ations (NGOs). n e list of qualified suppliers for &-m111,M gation and marketing equipment will lx2 subject to ADF approval. Credit for the purchase offarm inputs and pre uction m atelial valued UA 0.51 rnillion u'ill lx çrrnnrix.fl to Y neficiaryfarm ers under the credit schem e. ProvLsional list of goocls and senrices is shou'n in Annex 3.

5.5.5 Conmllting and Tm ining Senrica: Prœ urement of conmllting x n'ices for civll' workdesir , and shon term conqalltants for studies as detailed in Table 5.1. n'ti' l lx3 undenaken inaccordance with the Fllrvl's Rules of Prœ urement for the U se of Conmlltanz, using tlya

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; t6(Standard Request fOr Proposals

. Procurem ent w 11l t) e onx, tl-le Dasls 01' a Snon 11st. 1-or consul:lng )L'j. j . . . , . . . ,

.,.j.y uoa oorjsjuqyrat.jon. jFIITIRS , the Selectlon Prx edklres W'1ll be the com blned tep

.tt c. al 'qual.ltj. A.v 1 p.. .. 1 .. .. :: ' '' '%'. ' . ,.

. ... .. .. .. ,. .j; .. ...jI jjRR'I0 tl-a lrl li-lzpo COIRAPOi-1C F1 r W! l l be baS IC ally Hnple. naen. Dd bj' local ll-rl-t'2allon S17='.w,? l'ttl 1.S LS an O.w& .j. . j . . . . . . j ., , , . . x a. c, . a,yj tj . m. ttl y.yy tj.y e ig, y o y) t j .j a. a . , yj'ulolverslt'y CXIV I'I

.S Wl7O W1l1 trttln the llTl-zatlon O,f..1'1Cè.rS. m, 2le z . . . . =.. 1 ' . . .

-- ' . . z' ' .

' ' . , . . 31'exteaslon staff

. Technlcal A sslsfnnce m volves thc use, p'f' local speclalized agepçles o,r N . s ,. 1 Ijl ' d the'lr procurem ent w ill be on th. e'b. asis of 'Shbrt List

. Audit senzices will . :1'vzor -' c, 'n plalawl anl ( ,.

. . .-.1 ? j . . . . . . ; . ., )

. ' also be procured through.short Llstlng. . :,

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5.5 .6 General Procurement N Totice: e text öf G'eneral Prxurèmen: Notice (GP N) %,111 ''xu LV.l .

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.. . 1 . . . ' ' - - . ,'z' .Issued. for publlcatlon ln D evelopment Btijmesso upon a. p proval of th. e an 17r. ôposal b, y the. I ' . -Board of D lrectors

. . i

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5 o- 7 Reu-ew Procedur% : e follow m' o documçn? ar.e subject to review amd app roval bv tlne .B before pro 'muleation: .l. '*' . JTabl e 5

. 1 . 5.. .x $ u . jk4Prx tlrem #nts anze'm e. nts

. .. . - r . j. ' .' 1 (''In 't.,A A-liuion) ' ...1.'t*-' PROJECT 1'1-E51 ' ' ' . 1 k ''5

. . . ' . J .: *

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. ' ': . ' 1. ' ' .' N ?B' nk 0 tllerstzz Sho'ri Tocal ' ''IcB NcB . ,fy ,. q L ;.

*

. 2 ,Psottvded Li&t ;' L.. ' J x .-. . . . . Q ' . .- ' ...z. '

r k . . . . ' $..A. Civil. 55. or s . . , :. . - ., j' R

. ehabllitation of 25, Dams 0.28 (0.20) .' . 0.28 (0.2Q. 7) q j' : ,.' ' Esmblish-' of 43 l Tubelwells ' 0. 1 9 (0.08) 0. t 9 .(0.081, ' 'r ' A.# f' . r I . . . , . . ). . .'

, Drrainage 'CAnals' (4-.1 . ti5 km) 0.31 (0 .24) 0.31 .,(.0 .24..1) ,l, 'y> )u.).;

' NIa in Irr ig, çanal s (.57 .16 K.m) . 1 .06 (0 .77)t 1) l .06, ,' .(/U7 .77) / A..%.. ' .

. ' . '.

' ' Nfarketing Depoz 0.80 (0.75) 0280 (0.75) yb.

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'; a.B. Goods - , ' ' t jVehicles & Offtce Equ. 0 .68 (0 68) . 0 .68 (0 ..68a) E t'''' , . . . . g . , j .. a'

. suneel'nlykr-/sl-i'lg/neld! Equ. ' 0.06 (0..06) ' 0 J0$ (0.6 6). ' ' -'' ''.'J8 0 2 8 ) 0 $J8 (0 28) WTools and Local N'faterial 0.2 ( . . - . ..! f '

C. Credit: lrris. & lfarketinsq . . .. .

. r'' Irrigapio'n Equiprtfent j 0. 1 9 (0. 1 9) ' . 0. l 9: (0. 1.9,) j'I' ' '.. . .. . ?

. small Irrigarion Equipment 0.90 (0.90) . . . .p..9:. (.0.9(3. ) ' t .'; >'

Nfarketing Equijmenl ( . . . 0.88 (' 0..88) 0 -*8.5 (f) .v8-&i I l.'of ' ''' . , . ..' . , . . .i' .' Farrri Inptft/prod .ï Material 0.51 (.0.'5 1) 0-51 (0.5 l ) . . r>.y. '!i

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j j j . .jj.i. r.a 5.n111 :2 a n d S t'u d'ies

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' Srain ing.

' '

. '' 0 .30 (0. .X. ) 0 -20. (0.2 0) . O -50 (0 -20.). , 'f ,

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. Srud ies ' . ' ' 0 - 1 3 (0. 1 3) 0 .'.1 5 (.0 . l 3 $)' . l . -xC'

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.E. Consultancv Services , ,, v?j. U . . ' m ... ew k ; o e: j A c. (. ; r. G o gk ;. '': ..

.- . .7. .. *' . . . . j ' ' .' ' . . ,. ' * .- ' . . ' .' () oj 4, - (g 2 j gj' - tj j. y :(g .. j yy . . y.' (. a.s.yj.; = y.n 11 z u. q #. n o a z o x& tt w w . . = . . . . . . . . .. . . . . .

g . . . . . . . ; . .... y. .. . . yy . . y jy. y. y y , .xuym, j..j..... .. ..m s m.xy, jysyjy m., , jygpm .w y j, , ; yztg ..u . ; - . , 0. o .. zr. - ... xx g.=. .....m.- .- .. x. um ..... g.- . u. L ky ... s. . .;z...ss...g... z.g..gjy... .y . Y.m.. .w. . .p yg-p sg .. ; . g a. aja.pjj yvjsj s. gyu y x..m .. .. . . (; o ; . , g . y.- =- = . .. .uc.. j. A. -an () k-l. o n S'U 1 tâncy .S e IYIC é s ' 'Z - - % '' , - ' - - - ' -' . m- .-' u ;= ur.y Nuz . wwp . . g - s y1. j . . . ' .$ yik! . '

. .4F. Oper. & M ainteriance Oosts .ivehicles & Oftide Eou.l . ' :.3.7 .(0.37) 0.37 (0.37) é.1. ' ),

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. . * I -1 . .g.1:'rOI. M anac- & .suoervt. . . . .0.66 (0.6167 . 0-66. (0-66) . . ' aNGO ' s Advance P avm 'ent 0 . l 4 (0 - l 4 '$ 0 . l 4 (0 , 1 4J' . :' ' r- -t '.1l - t 1 . '' - j.,

.,.,'j.l ' ' ' e '. .v '. - tj- Office Rentàlzqond N alue . 0. 17 (e.(0) 0.! 7 (0- ) . . -k'

Gov stafl- salaries l 0 .7.1 '4ou'x. ) . . ' . 0.7 l .(0 ,.(%. 'q.'.' ' 'AC ''''' '

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. . ' .

j ' . . ... . : t)g.!(1) Numbers between brackets are funded by ADF resources. '! '

-, -- . ;j1.

8. .

z.

'

'!t

. ?,. -

' 'k. . ,. ' , : ' u; . ' . ., .. .z . . . Q- . .h .. M': i .., . .1 . . .. . - . . .. . . . .v.... . -v.:. .....,; tz:.-h-,.! zfG uwzr. 'zb : .' ---..b;'''2r - - '''' -=,.'...... .... .1,. - .k'.'>= x-= ..l ' .'-u-- x=1'.,. .'''*-

%.7 .dr. t .Jk. < Y W X F . : '. . J 'T. .>' a'. *0N4, $..

23

(2) -ouhers'' includz National Shopping Procedures.

- Specific Procurem ent Notices;- Tender D ocuments/Request for Proposals',- Tender Evaluation/Evaluation of Proposals Reports, including recornm endétiorls for

contract awards',- Drah Contracts if these have been amended from the drafts included in the tender

invitation documents.

5.6 Im plem entation Plan and Expenditure Schedule

5.6.1 The project will be implemented over five-year pel'iod with 1999 Y ing PYI. n e PM Ow ill be resporlsible for overall supenrision and hnplemenmtion of a1l com ponenz incollaboration with:

a) DOI of 5'1OM will implement the small-scale inigation schemes component. Beneficiariesw ill pm icipate irt the cortstruction of on-farm distribution cnnals, boreholes/ mbew ells diggingand head protection O ough the provision of local matelials and free laY ur. Design of civilwork including dnm rehabilitation will be contracted to local corssultnnz . Construction of them ain distlibution canals including m arket depot.s and rehabilimtion of dnm q will be contractedout to local corkstruction flrms on the basis of National Comm titive BiddMg (NCB). n em anngement of the four m arketing depo? will be tendered to the private sector by the end ofproject year 3 on rental basis; and

b) M OM tlzrough its ADl)s and RDPS will assign inigation and honiculmral officers toassist in the implem entation of irrigation, horticultural, and m arketing exterssion progranune andt.1-:.1 farmers for inigation, horticultural practices. In addition, 16 irrigation and honiculmralmssistant.s and 4 M & E officers will l)e assigned at the ADD level. At the EPM level, 2* Fl.wsw ill be assigned to collaborate w ith the selected NGO s and the M FI for farm er groupsformation and credit mnnngement. In collaboration with Inigation Task Fo= committee (1TF),the Village Development Colnmitlees (VDCs) will be responsible for mobilizing the Y neficiarycom munity to provide free labour for the cortstruction of the on-fann distribution cnnnls;

5.6.2 n e exmnditure schedule by component and by source of flnance over the projxt lxl'iYis projected to the as showm in tables 5.2 and 5.3 above. n e tentative implementation KheduleLs shown irl Annex 4.

Table 5.2

2 'z ' ê ' : 'Ex nt'l' ittirè Sçlied le by' ïcozhpppèpt..é ' - '- ' ' L ' '' z :::s-. ) : u'yoss -.J. j- '' - ': ..s-:-.:Ll-.:.z' u1tz:Cc.* 7<-2..'f.c-'?esV...-.-.s'.-.r.-z::'7.c;!.-=' z- .1N. -----....-...--..pc..o .-... ..m-.,..t.!. ...; ..? q-. ..L-- - z- . .. - é-.c-.'.lc i-'!7?-.!/-.-f2.iïV-iucl--.:-; 2 . . ...:... .c .- ..i- :-.'c-- -z:ï7=.--.L.n(In UA Mtlllon)

Components FYl FY2 17Y3 FY4 17Y5 Toml

A.capacity Building and Training 0.96 0.40 0.27 0.27 0.06 1.96B. Rural Micro-Finance System 0.39 0.49 0.64 0.66 0.42 2.60C.smallscale Irrigation Schemes 0.45 1.00 0.74 0.27 0.X 2.46D.Estab. of M arketing Strucmre 0.72 0.53 0.14 0.00 0.X 1.39E. Project Management Ofsce 0.28 0.23 0.24 0.26 0.25 1.26

GRAN'D TOTAI, 2.80 2.65 2.03 1.46 ) 0.73 9.67

F ='y . r . . . . . j , .y . . , . ; , ; . . . g. .y- .m g. . . ':

. . 'a

uA1. ' . ( ki

.

p,4 WJ'

.. ). . *' ..j

, 't

. ' . M#

Table 5.3 1' . .;- 1

., '1Expenditure Schedule by Source of Finance ' .'. ''$

4?!E l-l 7()-)' .i,î- 2,k41E 1LC'l'1L.i..r!)t. r1-)., !).. . .

. . , rr(ilI'.--,

4 . . . , . ..j.,Sogrce of Finance FY 1 FY2 . , FY 3 FY4 17Y 5 Total 'j .f . . . )

. . . .

. . . .. . . , y . &.;.

ADF 1 .47 1 .9 1 ' 1 .42 . ,' 0..89 0- 54 6.207 ' .: TAF 0.75 0.25 ' 0. 1 1 0. 12 , 0.03 1 .26 . :

' . .t:Govermnent Cgntribution 0.32 0.1.8 0.1.8 0.16 0. 16 1.œ

l . ' k/ 'Beneficiaries Contribution 0.08 0. 18 . ' 0. 19 0 . 15 . 0.(X 0.60 !

,1 .Donor (JICA) Contribution 0. 18 0. 13 0. 13 . 0. 14 0.œ 0.58 ' . .tI

. . 'ï 4. .. .

. . . . . . .?

To'rAt- ) 2.80 2..65. . 2.0, .3 , 1.46 0.73 9.67 . '.. . . .

- . ), I . .

.,q

5.7 M onitoring 'and Evaluation :;?

l . , ' .mpjementation progress ' '

'-''

-'

.

2*

5.7. 1, M onitoring and Evaluation of the pro), eet s .activiti:s includ. '11p1.' g l r2,.j . , .f .and expenditre will be carried out as a remalar m.anampmpnt ftm ction. It w ill lx . perform ed by ,s.

' l %-'' .

*=' . . .

- .

- . . .the Prolect M aM gement Office. The smff of th é PM O , will 'design and implpment , a .:;

' m nnngem ent Inform ation system with activities .dheckliyt. for th, e contz. ol 'atnd m enitorin. .g of all ,.,oroiect activities in collaboration with M &E offic:r: atu' the AcD' Ds level.. The perfèrmànce ; ',

. '*' -' I . . . ' e .

'

rrjindicators that are listed in tlze prolect matrix will be utsed for 'm oni toting lmplemenution of . u

. : . !: prolect activities. . oa-( ')x

5.7.2 ln addition to the s'upervision m issions by . tke ?Ftm drr a rni. d-term review. will l>e . j

undertaken no lat/r than the en'd of the third $ Ear' of p. ruject im pleraenmtioa. 'rhç nt id-tenn , .'Ayreview reporl wfll assess the proaress of the propkct and identifv' maior ' problems and, '.

- '*' I - ''''-' - - , - - - -'. ' constraints. Performance indicators designed hz th e prtyecy m atrix w ill lx used to monitoc the '

' rf l d m easure achievemena o f tk..e p' coject . at th, at stage. It will' ' m ake >:,prolect pe onnance an : Ik 1 ' ' t, .'

recommendatlorss for any desired moditkations of the projed as. desio'cxned. . j.j!. . j:

5.8 Accollnts. Audit nnd R eportinz Requirem en. ts '. . . : J '* !j . . , . .

. ,

5.8.1 Accollnts 'nnd Audit: The GOM will open a s'p4cial account for tl'le p rolmt fuflds. n e ç..

' - ( -., . ' ' . . Iprqect fund%' iwill be disbure to a commercial bank tfi Lilorfgwe the PM O' will be. lœ a&fvl to. . ' . '. . . ' ' '9.

facilitate the projeet lmplementation and avoid unnecessaéry tra.. pqn. etion delays. A prolect accol.ln't .. '''' j ''' a

'

' ' . . , .

will also be open 'ed in each of thç ADDS at the prolqc, t # e, g. n- e.-apcouqtnynt will .1x res-poyib. le y. g .... - .... . .: :;

'

. . .. . . .: 2. - . j . ..k . . j . .- .. ... . . L b . . . :. . . ... . . . x .. 'wj . . g, .

'

. . x. x, . . .

.

. ...sy

'

. .- fu' è:k-,.- ..t.z,.'c-'-.f.pct.)'-1.-..ç.:..-d.ç-s!. gq.u.qg.n. jd. .,..:.!-n-..q. .-1. .11. g.i- ton.. ap. f.:.?uEq.z-ço.. .mp-lqer. ig -.ek1.. .-ma. qelkazin- ,n. wk-xt-ax. d. rsm. a'nn. - .g'an=e, x.

. ..=nu 1. .n.. .f.pirm. , tcn.-'!.l. o. nzu-:.b...z..t. .kz

. ,

y uos. etj yj, o.a oategory yy jg . ': pj' System. 'Fhe accountnnt will eMure that thé éecountijf are. m. n :v jj , jexpenditure, source of flnance a-nd thnt a system .of irqe.ttaa' l contro'l is put in place to ennble '.

'

tjprompt recording of trarksactions, timely production of gcçollnrq and reports nnd. safeguas-d of O''i

.. . . s;the projeet assets. . '. . >

e .. . . .;r5.8.2 There will l)e a set of fsnancial and manage,meptainf, ormati on rezorcls m n:i-ntaih. e4 ih >ch . b.

. 17 #t) . . ' ; . ... . .RD P from which m onthly accoun? and m nnn. gçmept.. i.rTi. ormntion would .'.Y. , prçpled. . Tl>e' se ...

. ' ' . .

will be inteputed into the accouna of the PM O from where consolidatezl ; , . rly finnrvial ,' . . . . . . e ;U'. . .yrjyj

. . . yl j' ' :,.. - . kr

. Fij. .

. ' j. ..j

. . 1, . . . ? . ' ' . etju,q vk.zfitu.k . ,, .okz-xmxjp. . . , . . ,. . s ..,... ,...u. ..u s , ,,-y.. .... . ' . , .;...1

25

statements and mnnngement reports will be prepared for inclusion in the QPR for submission tothe Fund. The fmancial statemen? of the project will lx internally audited by the GOMAuditor-œ neral. An externally recognized Audit Firm , acceptable to the Bnnk w ill l>e retained

to audit the project twice a year. Provisions have been made for this pumose. The auditedfinnncial statements will be subm itted to the Fund for review and comm ent.s not later than threem onths after the end of each accounting year.

5.8.3 Reporting: Qum erly Progress Reports (QPR) will be prepared and submitted to theFund in accordnnce with ADF prœedures. Reporting on progress of project activities will becompared with set targets of the Annual Work Program Budget (AW PB). n e QPR will alsoinclude detailed description of acMevements of the various componen? and sub-components,exm nditure and physical acquisitions made as well as problems encountered during thereporting period. The M &E oftk ers in the 4 M )DS will collect and com pile dau from theRDPS and submit to the PM O. On the basis of the data gathered, the PM will prepare qum erlyprogress repolls and submit copies to ADF within two weel of the end of each reportingrie .

5.9 Recurrent Costs

, Project recurrent cost expenditures will cover the costs of Government staff salaries, fieldallowances for supervision, project mnnngement running costs and operation and maintenance ofveMcles. n ese costs are estimated at UA 1.49 million (M K 52.92 million) during the five-yearimplementation period. 'Fhe Goyernment will provide funds for the lœ al cost associated withlaries of the extemion and % ining staff. The staff salaries aré already in the Governmentsa

payroll and will not have any incremental effect on the Government's budget. As the project isdesigned basçd on Fanner Clubs formation. on-farm distribution cnnnls for the irrigation systemwill l>e maintained through the FCs system. Any other maintennnce cost G yond the projectcom pletion will have a marginal im pact on the Govenunent budget.

5.10 Proiect Sustainabiliw and Cost Recoven

5. 1U. 1 Projed Slldainability: n e sustainability of the project will be ertsured throujhprovision of capacity building of three related institutions in terms of inigation, horticulturaland m arketing technology. lntensive irligation, horticultural and credit training programm esboth formal and infonnal, on-thejob training and workshops will be provided to projectbeneficiaries through NRC of M OM and M glawi M anagem ent Centers. Further, long trainingcourses-regional and international training progrnm-provided by the project and in collaboration 'with JICA. Project beneficialies, in Farmer Clubs 'will be provided credit and training toem power them and ultimately m anage their own credit, inigation, and m arketing activities aswell as seed multiplication units, fruit nurseries, village-level storage facilities and foodprocessing.

5. 10.2 Adequate design has been m ade to erksure effective experience and group-behavioralchange for self-charge of inigation cost and water use to ensure susuinable management of theirrigation schemes. Funher, esublishment of community-owned savings and credit union would

,

create practical ownership for sustainability. Provision has been made in the project toeffectively supervise the activities and provide incentives to the benesciaries so as to ensure

+ :

' ; Y* Y 7=P% ' W I . : X PW''R'''R ' '. w : ;' ;

26

their fuller pmicipation even after project implçrp entatiqn.l5.10.3Cost Recovery: The GOM has put 1, place

,

.a ,lh1m hn.ai.', jm for cost m covery in public

financed progmmmes and prolects. Beneficlnnes .?qh ct. çr. tk: vL pfoject will pay .1 ./ 11 fo.r al1 the

1 , ' ' 1. ' . '5 - '''' ' '''' ''' ' ' ' ' ' . 'farm inputsy. irrigation equipment and servicrs. Ptljed.i. .erlet'i. ciali:s will p@y a fee at least to' I . - - k h: ii;. ' ' : ' ' ' z

cover the opemtion and maintennnce of the irriggtion ,$:h', emes ând the ntarketing pl,atforms.' .' ' ltt ' - . ' 'Established and nualified farmer and youth zrotl' b. s *1f1' (jbtain credit at market interest Tates

.l '*' @' **''' '

'

.*-2. ' '' ' ' .

.

The Crop Pr 'oduction Budget shown in Annex 5 demortsmates that prolect beneficiaries. will be. z'

in a position to service the credit factlity.

i : ( '. î*. . .6. TEC CAI, ECONOM IC JUSTM' CATI N

6.1 Technical Juktiscation

1 ; . o r is, irrigatlon w

j. y'ch .h, as be' e.n6.1. 1 Malawi used to have abundant surfaçe andklgrptlqd water. , ) . . ' .. . . : fvbèj .. jky j . . uuyjq raja #, ajj patton:js gandpracticed àlnce tlme-lmmemorial. However, as a çbiult Qf Jx eme 'y v' I i '

subsequent rec 'urrent drought there has been a sefi. (ms redktotion of bbtâ. sources of wate,r. 'lXi' xsI ' ' k. ' ' ,phenomenon calls for immediate conservation of 'available wate'r tht'. ,. ough rgin. iBtatv.r. h. arvtsting

. l : ' ..' - ' - ;- ' . 'and Judicious u'tilization of water. The proposed p.r4nlb.,'çt. areas have coEnsidésable potentiql 'forl J ' - ' . . ' ' -

.increasing agrieulmral productivity through irrigk.fjö. p . ,7f71#j.. e, w t'al population h as 1'eg1' Liized the.

' ' I ' 'e . . ) ! :- ' ' 'lmporunce of irrigation in crop production and tlak derit%n'd, tor irrigatibfl is presently very M gh.: .. ' 7s

. . .,jjy. .. ,;r . . .: ,, .6. 1.2 The inigation technology proposed under thiisan, rpzect. is $.1ma/.41, and already av@ilable, . in a

. . I ''''''-*' * .. ' '*' ?< s.'i'''f''R ' ' *'' ' 'sm all scale in 'the countrv'. it has been tried. by smdl Ylh. i 1-%4r7 andrp, rivakte sector and fovmd'. t o be

. j qe < . ; -; ..z z . . - k ;e. ' ;j . e( ..; . r . - , . z . .suitable. yurthor, as selected prolect area s rfgilk, . y fy t-t,.a,-il. rd. .j4, 'bg,jstence fnrm.. .s, smaloglderI

' ' ) : - ' :farmers usç hand cm ied water conuiners fer, irn..g,bs

'

.

'tt4pp d. urin, g flrou. ghy seàsop. . Eftkotive. . .. l . j jjyjexy C j jysj atyjy ypsypj .wjth, m.iqjplz k.,t dktralnlng in slmple ilrigation technlques and

. p'o.y $;., :,. () . . g , n ijI l . > jj f o, e. teçh' n ololgyy kénd 'sltiblt/gttt l1lyfacilities f0r pnrticioatinz fanners will exx dite. adö-btas-) . O1 *' %-' . . '*' .

.*' - . - : '!' ,*J'''. ''r

'

1 R '''C ' t. - . ' ' ' ' . .improve productivity. The tralnlng of DOI siiff. 'b oth, 1:1.t112 (.,ç M O M arid in the proleèt arèas will

1 . , janologks to farmersenhance their capacitv to effectively conuzmrkiggte.jzljgjfi.ö.n. .and relased. :tec . .l '*' @' œ' . - . ... .

- 't . ' .: . . . . ' 'and also provide the necessary baclcstopping fbf bkpèlici,â/ies. n e tralnlng' and tèehtaolb. gy

1 6 'tàbofa tioù wiitth project beneficiaries whopackages. to; be promoted will be developed in clttsç col,1 ' . (;fare the end users, front line staff and exteasion sta. .

6.1.3 Benetkiaries will increase their benefits tluough. di,versification of high value crops.. Thecrops prop. osed

. ) (para 4.2) are cunently beir). g g ,ro@, 1t.., 'tb. y beneficiaries but. higher zropplingintensities and l 'm provçd crop husbandry will result in riltc 'reased output.

.16.2 Proiect Behefits-

-

j6.2. 1 At the n 'ational and corrkmunity levels, the propct will contribute signitk antly to fpod

l , . 4 j.n tjae ,.5 Ep. A s wilj benefit fromsecurity and poverty reduction. A total of 8,5*. farni. .lEies. . 1 . ' .t

ralnlng in injgation and honiculture teclmolpgi.epo qs Wel.1 q.F cmdit a-ttd marketyicg facirlities tp beprovided by the prolect. According to availablk stdtistiçs. abogt 40% of ttz total beneficiariesare expected to be women.

6.2.2 W ith regard to permanent irrigation schemes, tw ith the eypansion of the H igated ama,

: 2 'G '

Y < ' ' ' ' ' ;, a ii ''- ' 'Cxtk-t'lt, p..4. ' .a,. ...u;. 2.,..,.e).# ?( tkwtlu.u -..w . .v.'!,'z . ..+ 2 . A.? 71 .v6I XW . <Y.*. 4. k- * . ... . '

. p: k

fanners will switch to m ore productive and profitable cropping systems, and corsequenlll'increase the inigated area under maize, cabbage, chillies, sweet potatoes, carrol, tom attx s.

onioils, paprika, and green maize. 771c project bcnefits arise principally fron: the in:roduction ofm ore high value food crops as well as from .improvem en? in the productivity of honiculm rulcrops. On the basis of the analysis undertaken for the selected schem es, it is estim ated that, atfull developm ent, increm ental crop production will be 8,0* tonnes of m aize, 9,9* tonnes ofChinese cabbage, 10. ,950 tonnès of cabbage, 3,300 tofmes of chillies, 8.8* ionnes of sweetpotatoes, 5,950 tonnes of carrots, 7,6* tonnes of tom atoes, 8,400 tonnes of oniorts, 1,.6*tonnes of paprika ané 8.450 tonnes of green màize almually. Funhermore. due to cropdiversification, nutrit' ion levels and fann incom e will im prove from 16.5 Kwacha to 70.0K wacha per person per day and consequently poverty will be reduced.

6.2.3 Social Im pact: n e labour intensive nature of aglicultul'al activities w ill result in asignificant level of incremenml employmeh: will be created by the project. In addition, thecortstruction of civil workz and the subsequent annual operation and maintenance, esm cially forirrigation and food processing equipm ent by youth, will contribute to labour demand. n erew ill also be an increase in em ployment opportulzities in the m arketing and prlxessing of farmproduce at the community levels as well as for suppliers of crop inputs (feftilizers, m sticides,and seeds) and contruct senrices. Although, there are some secondary impacts that have notYen formally include,d in the project nnnlysis, they should not t)e overlxked. 'llleseindirect/secondary impacz are im proved nutrition and welfare of the beneficiaries which will nodoubt m ake a signifirmnt contribution to the social and econom ic developm ent of the vulnerable

sectioas, through poveny reduction in the project area.

6.3 Financial and Econom ic Justiscation

6.3.1 Financial Jus-tincation: ln order to nnalyze the financial benzfits thnt would accrue tothe target fannel's. fann m Y els were prepared for sm allholder farmers who are exlxcted to lAetrained and provided with irrigation facilities. Crops expected to l>e grown under M gation aremaize, cabbage, clul' lies, sweet potatoes, carrot, tomatoes, onions, and paprika. QuantifiableM net'its would t)e an incre>qe,d production from 1e,3,380 ha irrigated.

6.3.2 n e resulting financial nnnlysis shows that the annual gross revenue from crop andhoniculture pre uction under irrigation cropping by the target group is exlv ted to rise from itspresent level (rainfed cropping) 6f MK 7.9* million (US$' 0.30 million) to 5G 359.53 million(USS 13.60 million) at full development. Net Revenue, at cortsrnnt prices, %,111' increase from5'1K. 4.35 million (USS 0. 16 million) to NfK 287.98 million (USS 10.88 million).

fcux-. 'suc. 6'.33 'rrfhé.àvefàjéufa!'m ihdomè. per, perk. bn .dâyètlndef fatnfed condiiionà.è'for'àlsavèlugd.Y- oldiahk J.':ci':::''u- 2 =uarea of 0.40 ha is exlv ted to increase from MK 16.5 (USS 0.62) to M K 70 (USS 2.65) underM gation conditiors. n e average net fnm ily farm incom e for sm allholder hzx ficiaries underirrigation conditiors Ls estimnted to increase from M K 4, 127 I1JSS 156.* ) to 51K. 34, 102 (USS1,288) per nnnum for a householder of one ha at full development. The crop pre uction budgetLs presented in Almex 5.

6.3.4 Econom ic Jttstm cadon: M econom ic analysis was also unde- ken in order to atqeqs

the economic viability of the project by calculating the Fronornic Internal Rnre of Renlrn

(-q 6 r . ,;4 ' ''*T''7' 1 . . .. z.:r -5 v.v -v. . r t . . ! . . ,, ..;4 . . () . . ,:' 4 .

. . J .::;' s

28 'i ). ''?!.

, . .,(E1RR)

. 'Fhe estimated EIlkR was 23% . 'Fhe calculatioqiof EIRR and the assump:iopw. made are '),presented in Ann 'ex 6 and Arm ex 6A respectively. ;

.#:. !;:

6.3.5 Sensitivit'y analysis B'as also undertaken for vqltrious possible liruatiorks. zatn assurqp:ion jw'as made of a 20% increase in project cost.s which redHjyd, . jthe EIRR to 17 .6 % . An assumption 't,' .( M 4of 30% reduction in expected benet'its resulted in an EfRR. of 13. 1 % . .t.' CE.

. .;..j- '';f,. sj.7. CONCLUSIONS AN' 'D RECOSG SENDATIONS... tv

-., . g7. l Conclusions :.. j

. .f ej '

7. 1. 1 'Fhe Honiculture and Food Crops Develepmênt Project (HDP) is in line with the UA-DF vjtegy Of poverty alleviationp

(T' he p.. roposed project ' confonns to the ' 71VLI Policy and straGovenlment' s Objectives Of improving smallholder. clbp' pqe. uctionoby promoting the adoptien . '1 '

. . .

. . . .. jof improved irrigation and honicultural technology , tb.'f

.earnii.tt: 'ers alxd.L' b y provid ing the neqessary $?Jinqt/tutional suppon to stimulate è i

,,.cap. acity building for irrigation, m arketing, cred. it à-,nd' , . .jsustainable agiiculmral development.

.

.-t.ek.Nt... ., ;.7

. 1.2 Poverty alleviation strategy of the project i; tç(g. q@exived with. , in the framework of total1 . .. ..bene'ficiury particlnation l'iqht from the conuneqçem émt.,.ô. f th e pçcyect im plemenution. n e ,

l '*

'

''-' ; . : . .y,incorporation of two NGOS and a financial lnternietli

rqty' .,''t0. train; implcment and marlaae credit 'zf .). I . . u . - - '''''''- . . '..* ,for the progect . will minlmize Government irïtetveptiom suenscrth' en decentrallzm: tion and ,.?l - j

pm icip' atory conlmunity development. 'Fhe involvemqpi 'bf . th e Farmer Clubs and Savings and jI ' . '.

t'Credit Cornmunitv Based Unions (SCCBU) in 'p lan'nin' ' '.g , implefnéntation and manggem ent, .R

j x w

'

y y . ! k . . jespecially for the credit component with a built-ityrrit . éck' .rër.tznhl''sm fdf' emd. i't reco' vç.ry, will suïtain ''--, 11 --. . . . . 2'.r. ' '

. i.,jjproect benefits a kfter the prolect implementation period. contribution to the invustm ent in tlne (

I farm irrigation cnnnls by the. benofi. ciyard

g es wilt p:rovid e theni, with a. serl-'z.e of -

7:1corstnlction of on-.' l . .jjy.t-y.futn:qmoy ocujties and add U,ownership f)f the prolect wlzich will enhance the maintepaece of

to the susGlnnbility of the prolect. ,

- * ' .1 ll - . .

, 7. 1.3 Through in'cre% ed prM uctlon of food and ,h, orti:ultural. cgops and M. weeh' er 1. come aecrual : ,,.I . k . . 'J'at household levels, the prqect will directly lmprqve food security of the Y neficianes; .l

' - - ' 'ë.5'.'

sllecificallv for' rtlral women farmers, the vouth anérqhiltlienv, 'thls $4111 rèsult in M tter nutrition ?). *' I *e tj . .and health. The development of nlral iafrastnwture wil1, uftlgrther help the nll-al women to haye J.j1

. ) .y -' .betler access to .m arket.s for sm all scale trading . actiyitlè.. s llqnlally C-.'II'.I'ie,CI out by wamen. kj1

. ' e .?d

qcom m unities ouslde th. e target groups will also benefit ftoth lmpcoved access to markecs and ?.r levels of emlployment generation in project relàt

.èd activities. '(i'highe1.. - . . . - .. . . . . .- . --.-. -. . - -.- - -- - ..v-. . --y.. . - ,. .-.. .,- - .. v -.... - - .. -- . . .. .-, . -.- . . ..-- --..- . .. gjy...iy,(y. .,.. . -., . ,jjj s- ,.s.. -

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. . ''-:'i i

roject, thbréfo' re, is economically and financially viable, ànd sœial ly d 'esimble. 2'..1.P . .r'4'

. **4

7.2 ADF Comm itment Capacitv 1

jj . . -,, -,, ... ..,. .--.... ..ë1!1ë1!1ne current allcvation of the ADF-VH resources for Malawi Ls UA 79.30 mlllion (UA 73.% )

.:f

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: . - ,:-,; . ...': '. .:xJ,!1itllf$'r... . .--- - .t.a.. . ... a ...-.- .a.-.. .% ..Qib'u...L.%..ï..-...A<..-. -. k..x.,.? .xr Lu-u-.,.-.k ---z.,-: -a. - -,. c à..aità..-.. : ...zé.-.:z;...a..k-ws. ... .. ...... ..?t zauâr zu...-.-., -$: ..- . -

: . S . - ,9!e . < . . .. a + .' r'!p

29

million for ADF and UA 6.24 million for TAF). The approved commir ent as at 31 October1998 is UA 50.93 million (UA 49.93 and UA 1.œ rnillion for ADF and TAF respectively).The anticipated total commi% ents as at 31 December 1998 including this project wöuld be UA74.84 million. Total balance therefore would be UA 4.46 million.

7.3 Recom m endations

It is recomm ended that an ADF 1.0a11 not exceeding UA 6.23 m illion and a TAF grantnot exceeding U A. 1.26 m illion be granted to the Government of M alawi for the purpose of

implementing the project as described in this appmisal report subject to the followingconditiorks.

A) Conditions Precedent to En> lnto Force

Prior to entry into force, the bonower shall have:

i) established a Project Mnnngement Oftke (PMO) based in Lilongwe and theappoin% ent of the required professional and support staff whose qualifications andexperience are acceptable to the Fund (section 5.2).,

ii) opened a slxcial account for the project funds with a comniercial bnnk acceptable tothe Fund and which has branches in each of the Agricultural Developm ent Divisiorts(ADDs) covered by the project tpara 5.3. 1);

iii) submitted a writlen undertaking thnt any allocation of land' to be used for the Project,including custom ary land, shall be carried out fairly in accordance with the laws ofMalawi (para 3.4.1)., '

iv) submitted a written undertnking concerning allocation of land to be used for thecoastnlction of four marketing depots in each of the Agricultural Developm entDivisions (ADDs) and collection centers in each of the Extension Plnnning Areas(EPAs) covered by the project (para 4.3. 18),'

submitted a written undertnking concerning êhnt it will subrnit a list of staff to betrained through Japanese International Collaboration Agency (JICA) as well as awritzn request to JICA for voluntarily technical assistant G fore June 1999 (paras4.3.2 and 4.6.1).

B) Qkher Conditioas

1. Provide evidence that it.s contribution to the project is retlected on an annual basis in theM OM budget',

2. Prior to any disbursement of the funds for the credit component of the project:

the Borrower and National Bank of M alawi (NBM ) shall have executed, in a formsatisfactory to the Fund, a binding and unconditional agreement for the adm ilstration

T *'N 7* K.- . . . . mj l . ft. 'A .

30

ftmds for tlle creditcomponent'.1'

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( , .

to the Y neficiary farmers; and submitted to tlz Fund a cop. y of the mod. el

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ENVIRONM ENTALX, S'SXS.SSFzfF' ' -N' '?f q,.....J . ' z . .

HORTICULT L FOUDC CRO P9 DEVELOPSG NT PROJECT '. . -11. .

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The project is classttied as Category 11 accorditgqatb .,t11'e XDB Enviro,nmental guidelines, as all ji'.ary mitigation measures has been inèö'' tpf (jèj led in t'h: project design as follows: '1the necess jj .

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1 Positive Im pact 'Jj- 1 -- q1

.1 By rai 'sing the standard of living of the rd'ratlg poor, the current rate of environmental .)l .

' r Aju i m, u e d . ' idegradation will be arrested and eventually m ,I1

.2 The inereased zround cover will m inim ize soil èrosion.l -'''' . .1 .3 The proiect does n0t involve displac.eni. ent (zyr involuntary resettlement. On the othetl -' '*' : '- ,

- ' .hand, the project will result higher incomes. lm. ,lpirove the m l.e of womems empower thel

, , through traîning, hence 'helpfarm ers, and increase their enkirolm zntal AwarenessI '

sustain 'the project.l2. Negative Impactt2.1 Possible interference w ith the river reserves. g

' ' th the upper reaches of the watcrsheds,2.2 Possible deforestation and human. aclivities r '

l . . .

.ouiside the project area, which may incèkasekfhe sedtment load in the tivers. This loadldeposited in the project dams, theèéby reducing t'heir water stbrage capac.itymay beland river bank's soil errosioa.2.3 Surface1

2.4 Reduced flow due to river diversion may impact th. e fisheries and aqul, ice life.land surface water contamination due tö excessive use of chemical fçrtilizers

.2.5 Ground

à '3.0 M itigation M eoqures

l . .3.1 The W ater Resources Board and the M inistry of Agriculmre (Land Resources a:d1 j (jesntng trhe river reserves. It is M6tycortservation Department) are in $he psrocess o

I '-' '*' .likely that a lo-m etre reserve will be qpp' lied frotpfl the average flood w ater m'ark, The1 - -. ' .. .detailed designing of the dambo schemes will takè this factor into consideration. .s

t - ,-,:?,:. '3.2 During rehabilitation of the dams, retentit p ponds will be built to trap the silt before ))1t

., . , ;; jthe water enters into the dams. The silt fhus tfàjped can be regularly dredged out ahd :

l . l)(tjused to reclaim lm poverished farm lands.

lk ' . dii',---3.3 Banks ofj dams and canals will be planted with vegetat.ion to minimise erosion ard, .';..!

reduce m aintenance costs. . -t;

l . - - 1. i-'3.4 D'iversion of water from perelmial rivers will be carried out in such a way aj to '.,..k

. l , . . , ' ? 'm aintain an adequate flow throughout the yoar, Breeding grounds for m igrating fis'h ' .!

l ' . ' jwill be m aintained Or increased, where warra'nted ., along the seasonal rikers. . - ..-- - ,,.

,l3.5 The application of chemical fertilisers apd pest, icides will be carefully monitored.

! ' . ' .

Spesific trjaining will be givien to staff agd fgrrnàsrs on this irssue. Farmers will also beprovided with basic training in local environmental management and simple teclmiques

i' 1in soll fertility enhancem ent.

1 ..:*7 ....... .3.6 Close co 'ntacts will be established with the GE 'F Lake M alawi/Nyasa Biodiversity

Project, Uhich has a program to monitor the quality of water entering into the lake a'ndto carry out research.

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X '.. nnex .

SIALA5VI

H ORTICULTURE .YND FOOD CROPS DENV LO PSIENT PROJECT (1D PI

Provisional List of Goods and Services

ADF LOAN /TAF GRAN T

u . . F.E. L.C. Total cost. Total costCOM PONENTS (UA '(X70) (UA .(X%) (UA '(Y ) (51K'0œ )

A CAPACITY BUILDING1 Goods and equipment 349.0 76.6 ' 425 .6 15, l 16.62 Training and field allawance 364. 1 182.7 546.8 19,421 .53 Smdies 29.6 40.8 70.4 2,5* .54 Technical Assistance 397.9 00.œ 397.9 14, 132.85 Farm inputs and local m aterials 00.œ (X).œ (X).œ 00.œ6 Operation and m aintenance 281 .4 120.6 402.0 14.278.47 Beneficiaries contribution 00.œ X .œ X .œ (X).œ8 Government contribmion 00.œ 1 15.5 1 15.5 4.102.5

B M ICRO-FINANCECREDIT1 Credit for irrigation equipment 761 .3 323.3 1 ,084.6 38,523.32 Credit for food processing equipment 267.4 1 13.6 381 .0 13,532.53 Credit for establishing workshops 21 .3 9. l 30.4 1 .079.84 Credit for marketing actih'ities 37-5.0 138.0 463.0 16,* 5.05 Credit for farm inputs & prod. m atcrial 353.8 150.2 5+ .0 17,* 1.3 '6 Operation and maintenance 95.7 40.7 136.4 4.844.7

ci SMALL SCALE IRRIGATIONl Goods and equipment 151 .7 33.3 185.0 6,570.92 Civil works 938.4 347.1 1,285.5 45,658.93 TA: Consultationsenrices--design 1 14.6 K .0 1 14.6 4,070.44 Local m aterials for construction 103.0 - 175.4 278.4 9,888.3

' 5 Benetk iaries contribm ion X .0 5* .9 50 .9 2 1 .307.5

D M ARKETING STRUCTURE1 Goods and ee ipment 61.0 13.4 74 .4 2,642.62 Civil worl 546.0 201 .9 747.9 26,5* .23 Stuclies 26.7 36.9 63.6 2,259.04 Technical Assistqnce 201 .4 œ .0 201 .4 7, 153.45 M anagemept and.field allawançe ..: ;.. . . . . . . . % .0 . .. . 20..2 20.2 . ...717.5. . :L-' . -. . . . .. . . . w*

-L. . - . * . ' . . . - .g ' - .u .c. . c: -. . .:a. t .g z .. . -. .. . ..r .':!:cE'.-..f- u. ..=:.'.ue 6 ' . ---- ,è-JL.>c..uu' L..-;l.- .o..pecad.o.h.r dq.m .nlntç:= ce.p--.-. .L... .i uz,-: è -- ,z.,..... .. .-.- 24.7. z- . . .q-.a r... 10.5. u.-k.' .. .-,-.c35:c2-, = z-.J-..è.( 1 .250...2 -rf.:=..7 Government contribution 0.œ 232.1 232. 1 8,243.8

E PROJECT M ANAGEM ENT OFFICE1 Goods and equipment 42.0 9.2 51.2 1,818.52 Technical assistant œ .0 122.3 1M .3 4.343.93 Operation and maintenance 3* .1 128.7 428.8 15,230.34 Government contribution œ .0 656.1 656.1 23.303.6

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91. 1!2. .i''k:

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F T R A. l N'. 1 N G l he . y' n'i n c and Exlensi on - -- 0 . 7 2 l O . n. 2 1 l o- . l .3 l I : c1 Tral '-' I . .. i ' *-' 1'

. . 9 S eed 5 'ltll Lipl ic at i on - -- . 0 i' l o'N 2 0 . 1 32 . Ow , 7/.7 i . . j. . I , ' . - - .a : s.; ..,sjo-a Soll and Brater Consen'allon

. --- 0 . 1 -90 0. l --79 -? ,6-.. ' ,.:' ej

4 Li ves:ock Producti on -- 0 . 1 9-0 0 . 1 2.7 2 , 69-o . t, .8I . . o ,.j(;. j qo-g s '.,,.,' 5 Small Scale Irrlgatlon -- .0 .090 O .t, o , .

I - . . . . + ' ...J r6 B'' ater S tlpp; iy and S an lt at !on ' .'%-= 0 . 072 0 ..072 l .5. l 1 .-.Nl> . , - .w . a ,; () ..; -/ a j - . t1i7 Ro acls a1) d B ri d .t'' es - -'- G. '. U z 7 0 , . 0-. . . .

! <-' ' ' .1G M E H I C L E S O & Mt ' , '. . I . . ' ...1 Tralnlng and Extenslon 0

.092* 0.023 0. 1 lo 2,424 d,j f . '

2 Livestock Production 0..030. 0.* 8 0.038. 0.808 ' .1 . .. . .. .

. ., . . . . .....

3 Slnal'l Scale lrrlcallon 0..0.3.2.: 0. .008 0.04 0.848 . fI -'- . . . . , s --r), gjj; :jjjj, (::),... . ..b.%' '4 svatcr Suppj ly and S arutatlon . -0 . 1. 10 0 .0. 2. 7 0 . 1 37 x. , ,

5 R O a d s an d B ri X e S 0 . 0 7 7 0 . 0 1 9 0 . 0 96 2 .0 1 .-s ,. ' '' ' 1I -- ' ' ' qx-f6 Poverty Nt 'lonilorinc System (PM S) '' ' 0'. .0 24 . 0 . . 0.030' 0.630 . ..'W - . . . ' M *1

., '. 11 .. .. ,. , ' ,. 'k' ' . . . ' : lk '7 Pro-) ,ect Imp lementatlon I.J n1t (PI U) 0,7.-.09 .9.-4 .. 0 .023 0 . 1 17 2 ,461. . ' k..

. . j . . . ,;z,jjj,yH OTHER O PERATIONALCOSTS ,? .

. ' ' J . ' ,.. . ' 11 Soll and B/arer Conservatlon 0 .003 0-026 0.03i' , 0 .647 , e t*J.

2 Livestock- Production 0 .0 05 0.026.. ' 0.03. l 0.647 ' ' ' ,.x. . , I . . ' , . . , . - . '' ' '- ,-'.3 Poverty Menltorlng Systcm (PM S) 0.0.32 0. 168 0.2œ. 4, 197 .

3 Project Imp lcmentation Unlt (PIU) 0.0,06, 0 .03 3 0.039 . 0.808 , -. '. . . ''' . r. s i.'' '

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M ALABqHORTICULTIJREAND FOOD CROPS DER LOPSG NV PROJECT (I'm PI

Tentative Implem entationschedule

Adivitv/Action Initiator Startinc Endina

AdministrationBoard ApprovalLou Agreement SignedLoan Effective

Proiect Manacement and NGOsOffice allocated and furnishedPersonnel aswignedList of NGOs approved and contractedSelection of two NGOsIxgal agreemene signedCommencementof farmer grduping & training

Vehicles, Office & Field EnuinmentList of suppliers drawn and approvedTender documents prepared and approvedBids invited 'Bids received and evaluatedEvaluation rem n approvedTenders awardedGOOIIS received

Traininc at NRC & OverseasCourse material preparedOverseas training reselwedLocal training startedOverseas traing starle.dFarmer traininmg starred

Consultancv Senrices for Irrication & M arketincShon-list drawn and approvedProposals invitedProposals received and evaluatedProposals' evaluations approvedConlracts awardedContracts signedCommencement of services & completed

Establishment of Credit SvstemM FI shon-lisled and proposal invitedSelection of M r'lLegal agreements signedCommencement of senzices

Civil W orks for Inication & M arketincTender documents prepared and ap

-provedBids invitedBids received and evaluatedEvaluation report approvedTenders awardedConstruction commence & completed

Small Scale Irritation EquipmentList of suppliers drawn and approvedTender documents prepared and approvedBids invitedBids received and eq'aluated and approvedTenders awardedGoods received

Annex 4

ADFADF/GOMADF/GOM

17=-98Feb-98Jun-o

Dec-98Feb-98Jtm-gg

7111-98Aug-98Sep-99Sep-oSep-HContinuous

Sep-xSep-99Oct-99Nov-HNov-oNov-oDec-02

M OAI/DOI/DOCP J= -98M OAI/DOI/ADF J= -98M OAI/PM O/DOI/ADF Ju1-99DOI/ADF/DOCP Jul-oM OAI/AM INA Sep-oM OAI/PM O/NGOS Oct-99

M OAI/PM O/DOI/ADF Aug-bNM OAI/PM O/DOI/O F Sep-oM OAI/PM O/DOI Oct-oM OAI/PM O/DOI Oct-oM OAI/PM O/DOI/O F Nov-oM OAI/DOI/PM O/ADF Nov-oSupplier/pM o/x l Nov-o

M OAI/PM O/NRC/ADF Aug-oM OAI/PM O/DOI/DOCP Aug-oOM /PM O/NRC/ADF Oct-oOAI/PM O/DOCP/ADF Nov-oM OAI/PM O/NRC/DOI Aug-H

M OAI/PM O/ADF Sep-HM OAI/DOI Oct-oM OAI/PM O/DOI Oct-oM OAI/PM O/ADF Nov-oM OAI/PM O/DOI/ADF Dec-WM OAI/PM O/DOI ' Dec-oConsultants Jan-œ

DOI/ADF/AM INADOI/ADF/AM INADOI/ADF/AM INAM OAI/M FI/PM O

M OAI/PM O/DOI/ADF Dec-H'M OAI/PM O/DOI - Jan-œM OAI/PM O Feb-oADF Jul-oM OAI/DOI/PM O Aug-oContractors M ar-œ

Oct-oNov-oN ov - 99Jan-œ .

Aug-oOct-99Sepm lOctm lContinuous

Oct-oOct-oSep-XOct-01Nov-olNov-olJan-01

Oct-99Nov-oNov-oContinuous

Nov-02Dec-02Jan-02Jun-02Jul-02Feb-02

PM O/DOI/ADF Sep-oPM O/DOI/ADF Oc(-OM OAI/DOI/ADF Nov-oM OAI/DOI/PM O/ADF Nov-oM OAI/DOI/PM O Jan-œSupplier/Dol M ar-œ

Sep-99Nov-oNov-99JaneDec-03Continuous

W1P'' ''

r'Y. YK *

Annex 5HORDCULTURE AND FOOD CROPS DEVELOPMENT PROJECT (HDP)

Crop Production Budget

Existing Situation per baof Rainfed Farming

M aize Cxeex'a Sweet Ground Pigeon Sorglxzm Soya T@ba.-.-.-. Couon Cow Pea ' TmalPotaîoea Ntlt Pea Bean we. A.wv

- As the average helöing Iand is 0.37 ha. return per person day is calculaled to be (Mk 44 x Q.4O ha1 = Mk 1 7.5

Envisaged Situation per ha (three seasonsl/ *of lrrigated Land

M aiz/ Chineye Cabbage Chillies Sweet Carrot Tomatcm Oniofu Papfica Green Totsllwbrid Cabbage ' Potaloe: Maize we. Aee.v

O.4 O.1 5 O.2 O.2 0.4 O.2 0.25 0.25 0.2 0.25 2.5...... . . ... ....T;Tr..(ïF7r;r.. ....r:= .U.U. .-...-..-.. .. ....U..U.......... . '* ** œ'. . . . . . ..... ... :.. . . . .. . . . . . . .... ........ . . .. ......,...........-....... ... .. ... ....... ... ................... 15ïrr: s:...;....r..:..:::::.::::::,l . !1' I1l (:) 1:) l.J 4:2 -I- l (:) IhI ........... .................... .................................... . . .................................... ,.........................2. :..:... .... ..........:.................... . ..:'.....:'....'......::..:'.: :.::: ::: $

Averaae proöuction lKq .na, ........... ....... s-o. oa... : s s ss .........................x. .s.;.x. z. ... . 91 , :'................................s...sno'. a ao. .,.................................9. . .. 1 o ooa. -..................................2...00.. , o ooo :..........................:E.'sàà:. . . .: . . . . . . . . . . . . . . . . . . . . . . . . . . . :. ..... . ..... ... . . . . . . . , . . . . . . . . . . . . . . . - . . . . ... .u .., . . . . . ; ... . . . .:. . :!:.: : . . . ..'.'. . .' ' ' u'... . '. '...'.'.'.'.'.'.'.%'.'.' . ' .:............................ .' .'.....'.................. . . .......u...........,.... u .. :.:.:.:: ...:!:1 ; )::::E: :i.: ' '!; r i (; (! ( ? ./1 l1L kr l1L () 1 :::;.:::..:..:. ' :..:..'...:.. 122 .. !5;..... :3 '...'...'...'...'...............'...............'.. :Er .. !54 : 1 124 : ..:....................................................:.. 111. .: !5 ..'..........,.,.............,........'........... 151. . fik .. fs ........................................M . ask :::.........:...:.. ..::ë:.!:::::::::Eij:jj :33-3. :::.:.'.'.'..'.' '.'..'.'.','.'.'.'.:.! .'.'.'.'.','..'..'..'..'..'.'.'.'.' '.'.' . .........'..................,'......i ..'.'.'.'.'.....'.'.'.'.'...'.'.'.'.' '.....'.'.'.....'.'.....'.'.'.'.'.'.. 1:.:.:.:.*::.'. ;': ::::,:,:. :...........

(21 l ( 1$/1 14: ) :.:uu: %. 11 !; ':() ()r ()$ :' !$ 1Ek f$ i$ 1!k ;!.:.:.:.:z. àl;f:k : 15;. ri 1!k : 1, i! :!, ï) 1, -''''.''.''.'.''''.''.&'a''.s t:l t;j'' ,! ,! (:I :2r (:p .:':':':.:%%: !5i tp- '' ' ' !' (:p ()k (2p () ''.''.''.''.''.''.'''6''a''' 42, () () '' zlk () () ()h () :.''.'.'''.''E'''':!:'':!'a' '.' ':: ' '.' ' ' '::rO>S nCDITI e . . . . . . . . . . .: . . . . . . . . . . . . . . . .jj jjk rPkj ): $ () () S )r t; .. . ......... ......... .. ...... ...u ............. ............... .. ...' ' '' ....1E:; tzl 42, 4:, ... : : .. .. : ... : :. : : . . : .. : : .tktk7 (ih)o :. !2j !:; ,5; .. : : .. : : : : : .. : .. .. : .. . : : .. : : . .. ..: : : : 33'3. !j;.. .. ::! :2! :5; .. .. .. ..: .. : : .. : : :.. .. .. : ..: .. :.. .. .. ::3,. f;jt. 1:)1 .. E :3 1!j (:)/ .. : ... : :. : :. ..... : :. : :. .. ... .. :. : :. : :. : :. .j!jr. tr 4::1. E (5 (5; .::)h .. .. .. .. :.. : : : : : .. : .. : .. : ..tI i .k. :;!2 tjsi c. .. :Ej :!; !i;' :.:..E:-:::.:::: :: :::i E::i:, ..:...'.. ..215, '4;j(ljj; 'j::

.. ..... . . . . . ...............; ...,.. . '..'..'..'..'..'...'.'..'....'..'. .: ....... '..:........ . . .....:...,...:.:.'.. .. ::: : :.:.:... ...: ' '.: ' ' ' ' ' 't:!Z 4, t' 1: i 1 i ;r 4, r : u:.: .u. .. !k . u :1 12! 65 (:p ....:.............: ...%:uu ?E).. .151 .0.. 1 () 65 (:h ..,.................................3 333. t:y... 1 ::k :? (:) u.,.:.:u....... .........:8. .. 6) :3 ::I ................,............ $;t tbi 4:, $:,... 1 1 1 15 ::::::::.':(!E::.E':..'....4. .'. .:...... ..... ....,........ .. ....................,....,.... . . .. ..,..................,.......... . .. ..,..........,............. ... . .....,...,,.....,.,.............. ... :....::...:(.. ,...............:.::...:...j1) 414 t;r r 1, : :.,.... .. . u..., :.:... j(2!.: (:) :.......................,........:........... l:)r. : 1 :1 !$ ....,.......................... 4:) . 4:) ....................... .... . 4:) . :2! !5 .....,....... ................. (:).. (:) :'..--::.'..'..'........'..'......ë l :4j::1t::.'.' .. . .. ...'.'.......: .......................'.....'...'...'... ...: ...............................,........,............. ... ..........,..,.................. . . . . . .......................................... ...: .;'.:...'...'...'...'...'....'..'...:..:...:::!:.:..::.. :

..: ..:. . ' .: ' '. ' ' '.' .'....'..'..'..'..'...'.'..'..',.'.. !' '..... .'...'....'........................ ' '.. ' '.... :.:..'.:.:...,..... .... . : : .....................'...... .' . . . ... :i...'....'..'..'..'..'..'..'..'..'..'..'.'..'.:.'.j17 $:1 f, l 1!w l .?L 1) i fl t (, r, 1, 1h4 (; f, :.'.'. ! '... . .' ;p7 !5)4:h . 1 :1 :? (2h :.'..'..'..'..'..'..'..'..'..'..'.. 1!04:8 ï;l : 1 :? 15 (:p '.n'.'.'.'.'.'.'.'.'.' )E) 12! :$ .' :? (:j is .'.' .'.'.' ' ' '.'.' CE 1@ IECS:)r . 6) 121 1$ . '.'.'.'.....'.'.':J1 ' 11; 11; (;) : 1 (:) :? !5 ''.''''.''.''.''''.''..'.''.''.''.''. tll jft ,11.. . . ... . . . ... ........... .........................: : ....: ........................,...:...:.... . .. ... ........ . .. . . .. ....................,.. ... . . ... :E:j . E.:j::..:E.Ej...:..........................:Hired Labour ' . . 1 380', 2 7 50 ,.''.,'.:'''..'..'.''.4..4.2. .1 5U7 2850 '*'*.''..*..'.'',''.''..'4''.1'500'. 236 :7 .'>.>''' '*..*'..* ' '21 5,.0. 1 : 53 *.''.*''*''.*''.*''.''.''*''.31 504: 1 4 50 ' ii h '' ': '&''a3m. . . . . . .-. . . . , . ..,................. . .. ... ......,..... . . . . ..........,...... .-. 2 . - . E -s... .', . '. . . . . .:. '..........'..'.....'..'..'.....,'..... . .....'. .,...,............................................... . ..:.:,...:.:...:.. ... . . . . :.............................. .... ...'. é.....:..:....:.i..i.i::,i;)....é. ...............:.>.j. . . . . . .. ......................,. .. ......................., ,. . .. ... .......... .., .. .. . ...........,,...,...,.. ,. : .,; ;.;,r.. , , , .r (1 Jn :; ;) $) r l :.. . . ... rI . iljl:j .. :ël ;? !$ ...........,..........,.......... 17! 4:)8:2t . 11 !5 (:) ..,..............,....,............1 ..:/r. (:)... 1 :7, (:) : ..,,.....,:.........,., .. :S; ;?p !5k .. :5 E; $:/ 2 ..,......,.......,,..............4 151 (:j... 1 :2 (:) :....;........'..'...'...'..'.:'.:'.:g ;kj ;kj $Credil Repaymeat : . .... .. 3 G33 .'6 3-1 1 5 . 1 .::::::y.:.:::.22.3 1 ,1 '. 34 1 8 . 8 .........:.:.'...1:22 '2. 9.:.. 2 5 : zr- . 2 '....'.':...: 2752 . :'. 2 1 9 6 .0 ..:'...'...'.......'......3.848 ..Q.: 1 5 7 O . 7 E ::.h .:.:....:1..::.7;:#7ç$. .. .. .: ...: . . .... ................,......................... . ........ :.......................................,............. 9............. .

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. . ...EL....:...J;; . . : ... .............:........ .-i&. .f.- . . . .. ... .3:. .. . . :.... ... ............ . ... . . . . . $Total Costs (M K ) : ' 6 Q4 9 1 2 64 5 .:.:..z...u:. .,.8 26 4 :. 1 2 6 59 .,...'.'.'.'.'...4. 528 : 9 309 '. . ': : 10 1 93 8 1 3 1 .:.*.':'.',.,..4 4 '248 ' 5 8 1 6 :'..*..*.'*..'.*'..*..*.'*..'..%,.477.:..zj . . j . . . . ' '' ' ''. ...''' . >: . . ---i7fr)E. . . :)t)i:@:. . . . ..................... C17i7#. -##i)f?#i$itliG@:..-....rr..'...'..:tr..r.ti - -' ---' . . . ..- . . . --'. . ... . .. .:f2.:..:;r.1.cr!:r.-.&,... - -' -h '- ' ..................:.:.::i:::::.:.

:!.;...............;.:I1I N B fi . e as : ' 4 6 oz 3 ..':''.'4..'.'..a2' ''>'q6'' 7 s 7as '>:'t''.':':''j 4:''97'2:. a4 z : ! '.'.''' ..48 'ac'z 4 : a 6 a ::::-7. :':' ' ' :-zs2': z4 : 84 ::.:$>*'k. ' : :''' '''' ::. !z : (! j: 4, ! 19 . . . ....:...... . . . .............. j . . .. . . . . :u ....ar ... . ...s.. .......z.....,.. kpj. . 5. N . ... . ...... -... ..., .. . .......................:...3 k1;. ;;.tj:. 36b. ;1j... . . . . 71.77 :J :.:*': U . : PV'--- I6H!;% *'.* 'e.'z' œ.' >' - *'''' *''-' *-'-' * *-' - * r - ' '''*

*1* () t a! 11, (, r $; () Ij ,; l (j ;, '' ' :;r 121 (:j :pr :1 (:j '....'..'...'..'.'..'....'. ! : :;! zs;kj;i : lj r; (;j '..'..'..'..'..'..'..'..'..'..'..'..; jji tji .: ej j!k (:/ .. ' ;ër :j jji :2 (2j js .'.'.: *...,.,.....',.:.:.... :4j !j; j:j . ;2j dj j:j :'..'..'..'..:.'..:.'..:..':':'.'. 'jrj jgj.'kY . ... ................................. . .. .............................. . ... . .. .. . .. .,............. . .......................'.....7. .:

Relurn. Person day . . ,! .'! ,B 2 o 9 2 .:.: :..'.: :.' : ':1 .3 .1 7 . '! 4 5 5 :v.'.:.v.z.'...'.ag ':G''. 2 1 6 9 ' . . .' :. .' *Z2.4. 7 2 04 2 :: ''.''**.'.'.'.*'..''..''.*1 B3 () : 1 6 2 8 :'.**.*..*.'*.*.*'*..*.,:'*:*.:*':17. # .:::. . . . . . . . . . . . . . . . . . . . JJ; ;; k; ./ * U n d e r i r r i g a t i c a , o n e h a 1 s e x D e c l e d I o b e c u l t i v a t e d 2 . 5 t 1 m e s d u r 1 n g t h e y e a r a ! t h e p r o j e c t c o m a l e t 1 o n

-- As lNe avef a pe t3olc,'- - ian:j Is C) ..19 na. re:urn pee pees 3n :ay is calculated to be (Mk 1 73 x 0.4 ha) = 12 K 7 3r

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