Document of

The World Bank

Report No. 12236-CO

STAFF APPRAISAL REPORT

COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECT

MARCH 24, 1995

Country Department IILatin America and the Caribbean Regional Office

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FISCALI, YEARJani iary I t(l DIccencber 31

CUIRRLN( Vk ANI) ItKtIlV&IJt.N(UY UNITS

l frllalty I11ltl - Peso (('o)S)-laCI1:Lnge Rirw (D)c,riinlhcr 31. 11494

IiS$l .1) &ol$ XM)

WF:l(IIi'Ni ANI) MEll'ASLURE-SMrlric Symeem

(;II)S.SARV OF AEIRIR VIAiIONS

AOP - Annual ()lOraling Plan (Illal AnFIal de Operaciones)AWP Annilall Work Plan (IlIan Anuial de Ttabajo)CENICAFI- Center lor ('olfee lwcslitiation (Centro de

lIv-esligiAciies de Yal)CENICANA - Center tzir Sugar ('ane Investigation (Centro de

Investigaci6n de la Cafua)CCTA - Colombian Corporation for Agricultural Investigation

(CorixoracitIn Colombiana cle investigaci6r.Agropccuarla)

CGIAR - Ctonsultative (roup on International AgriculturalResearch

CIAT - Internatinnal C'eniter lor'lTropical Agriculture (CentroIntcracional de AgriculluraT ropical)

CIIVMY F Internationial ('enter for the Improvement of Corn andWheat (Ce"cnrn IntL-racitntal dle Mejoramiento de Maizy Trigu)

CIP Inteantal Ceittr br 1w(itatoLes (Centro Internacionalder la l'.lia)

flNP - National l)irarlioerit ol l'laniitig (D)epartamentoNacional de L'laneacitSit)

D)RI Fund for Rural l)cvelopnicnit (londo de Cofinanciaci6npara la lnteroion Rural)

FEDIjARROZ National 1E -deration of Rice (iravers (Eiceraci6n dcArrriwei:esj

HIlMATr - ('olon10t1hian Institu1te tlF Flydrology, Meteorology andI and Plreparation (Instituto Colombiano de Hidrologia.Miceorologfa y Adecuacidn de 'ITierras)

IC, C'olombian Agricultural Iislitute (Instituto ColombianoAgropccia rio)

MCU 'The Manageenicnit aaed Cooirdination tUnit (llnidad deAdjtinistraci6in y C(oordinaci6n)

MCA - Ministrv of Agriculture (Ministerio de Agricultura)RDIP - Rural t)evelopment Investment Vrogram (Programa de

Diksarrollo !nlegral Carnpesino)SINTAP - National SystCm for Agricultural Technology Transfer

(Sistema Naciondl para Transferencia de lEcnologiaAgrkcola)

UMATA - Municipal tlnit fbr Agriciulttiral Assistance(ltinidad Municipal de Asistencia Agropecuaria)

FENAILCO - National Association of Merchants(Fcderaci6n Nacionlal de Comerciantes)

IDB - Inter-Amnerican Development Bank(Banco Interamericano de Dlesarrolo)

PCR - Projcct Completion Report(Informe Final de Proyceto)

NGO - Non Government Organizations(Organiraeiones no Gubernarnentales)

ICB - International Competitive Bidding(Iicitaci6n Pub:ica lnternacional)

LI B - Limited Iniernational B3idding(I icitaci6n Intornacional Limitada)

COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOPMENT BRO3ECr

Contents

Page No.

LQAN AND PROJECr SUMMARY ..................... Hi

1. THE AGRICULTURAL SECIR ...................... 1Structure and Performance ....................... IPNtential for AgricultFiral Production Growth ............. 2The Small Farmers-Contributions and Constraints .......... 2

2. AGRICULTURAL TECHNOLOGY DEVELOPMENTAND EXTENSION ............... 3

Backgxound ............ 3National System for Agricultu-a ThchnOlogyi 4Colombian Agricultu-a Research Institute (ICA) ........... 5DR andExtension ............................. 6Bank Strategy in the Agrcultual Sector and Support for

Agricultural lbchnology ..................... 6Lessons from Previous Bank Involvenent ............... 7Rationale for Banklmt ...................... 7

3. THE PROJECT ................................. 9Objectives and Desciption ........... ..... 9Detled Features: Technology Development and ; paion ... 10Detailed Featus: Instituiional Development ............ 11Stas of Preparation: Project Year One (Including 1995

Investment Subprojects) ..................... 14ProjectCosts ............................... 15Project Financing ............................. 15Procurement ................................ 16Disbursements ......................... 8...... iAccountingandAuditing ........................ 19

4. PROJECTr MPLEMENTATION ......... ............. 21Organization and Management ..................... 21Operational Manual ............................ 21The Executive Council .......................... 21TheManagementCoordinationUnit ...... 2........... 22TheNationalPanel ............................ 23Regional Panels and Coordinati ....... 23............ 23Pwcessing Subpnrects JLr2 nanced Under the Project .... 3.... 2Prparing Annual Operating and Work ............P. 25Environmental Inpact, Evaluation, Monitring, and

Supervision ......... .................. 25

5. BENEr[ ANRIK .......................... .28

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Bfsefits ................................... 28Risks .................................... 28Pro jectSustainabbiity .......................... .29

6. AGREEMENTS REACHED AND RECOMMENDATION ....... 30

ANNEXES:Page No.

Annex 1. Loan and Project Summary Costs ............... 32Annex 2. Project Summary Costs byYe .................Y. 33Annex 3. Funds Flow Chart fo; National Agricultwal

Ibcbnology lTansferPrgm .................. 34Annex 4. Definitions ............................. 35Annex 5. Subproject Application Form for Cofinancing ... ..... 36Annex 6. Checist for Subproject Supervision

and Evaluation Reports ....... ............... 41Annex 7. Organization Chart for National Agricultural

lbchnology Tlansftr Program .................. 43Annex S. Key Indicators fbrtheProject .44Annex 9. Audit Requirements .45Annex 10. Criteria for Subproject Selection .47Annex 11. Environmental Checklist and Key Screening

and Monitoring Factors .52Annex 12. Draft Terms of Refrrence for Technical Assistance ..... 54Anmex 13. Schedule for Project Implementation and Supervsion .... 56Annx 14. Selected Documents and Data Aalable in

the Project File ........................... 59

Mvap IBRD No. 25401

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COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOIMPENT PROJECr

LOAN AND PROJECT SUMIMRY

Borrower: Republic of Colombia

Implementing Agency: Management and Coordination Unitin the Ministry of Agriculture

Beneficiaries: Farmers (majority small), growers associatons,universities, private sector, DepartmentalAgricultural Secretariats, and municipalities.

Poverty: Program of targeted interventions. The projectis expected to assist in raising incomes amongs,mall farmers, whose productivity is belowave rage fir the sector, a group that includes themajority of Colombiis poor

Amount: US$51.0 million equiwalent

Tenrs: Tb be repaid in 17 years, including 4 years ofgrace, at the Banks standard variable interestrae.

Commitment Fee: 0.75 percent on undisbursed loan balances,beginning 60 days after signing, less any waiver.

Fiaancing Plan: See pta. 3.21.

Net Present VaTie: Not calculated - the project finances researchand institutional stngthening.

Staff Appraisal Report: Report No. 12236-CO

Map: IBRD No. 25401

COLOMBIA

AGRICULTURE TECHNOLOGY DEVELOPMIENT PROJECT

1. THE AGRICULTURAL SECTOR

Structure and Performance

1.1 In 1992, agriculture, fisheries, and forestry accounted forabout 22 percent of GDP for Colombia, provided employment for 30 percentof the labor force (three million people) and contributed about two-thirds ofmerchandise exports. Coffee accounted for about 13 percent of agriculturalGDP (and about 47 percent of total agricultural exports); other permanentcrops for 33 percent, annual crops for 19 percent, and livestock for 35percent. Coffee exports, as a proportion of total agricultural exports, haveremained fairly constant over the last two decades, but some diversificationhas occurred within non-coffee exports, which now include flowers andbananas. Growth of agricultural GDP in Colombia averaged 4.8 percent ayear during 19780, but slowed during 1980-92 to 3.2 percent a yearreflecting both weakening demand for Colombia's agricultural exports andfaliing international prices.

1.2 Colombia has a total land area of 114 million hecares (ha) ofwhich some 33 million ha (29 percent) are considered suitable for agriculture(14 million ha for crops and 19 million ha for livestock). Of this area, about27 million ha are presently under cultivation, yet crop production accountsfor only about 4 million ha (29 percent of the total area potentially usable forcropping) and for about 23 million ha in livestk. Of the ten million hasuitable for rain-fed production, about seven million ha are in sloping areasin the Andean foothills and are primarily used for permaLnent crops tomhinimiz erosion problems. Another three million ha are in flatlands,primrily in the coastal areas.

1.3 In Colombia, three typical farming practices prevail. Modemagriculture, located primarily on flat and relatively more fertile lands. Thistype of frming, with its capita-intensive technology and higher productivity,accounts for about ten percent of the area of production. Tfaditionalagricultue is typical of mountainous land in the Andean zones and of tropicallowlands on the coast. It is labor-intensive and achieves lower productivity.Finally, there is transition agriculture, which uses both modem andtraditional technologies.

1.4 In 1992, the agricultural sector suffered one of its worst yearsin recent history, and output contracted 0.9 percent. The effects of a severedrought were exrbated by low international commodity prices, traderefms that increased import competition, lack of credit availability,areciation of the exchange rate, and rural violence. Facing declining ruralincomes and growing pressure from agricultural interests, the Govemmentrecently adopted an Agricultural Recuperation Program of trade, credit, andother agricultural policy measures. The situation has improved and thesector grew about 2.7 percent in 1993 and 2.1 percent in 1994. There is,however, continuing political pressure to introduce protction in the sectorthat has partly, but not completely, been resisted by Govenment.

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NPtential for Agricultural Production Growth

1.5 Colombia has considerable potential for increasing agriculturalproduction by bringing additional land under cultivation intensification andincreasing productivity (improved yields). If local or external demand is tobe satisfied by Colombian agricultural producers, however, production has tobe competitive in a conterct of open borders. increased productivity wouldhelp t increase rural employment and incomes, alleviate poverty, and slowmigration to cities.

1.6 There are presently large variations in crop productivitybetween commercial crops (prduced mostly by lare farmers as single cropson good .soils in the valley floors of the main rivers) and food crops(prduced primarily by small famers who plant a number of crops in smallareas). Recent statisis show that small farmers' yields for basic food cropsare about 66 percent, for cane about 50 percent, and for beans up to 90percent of the national ave . Although large farmers tend to have higherquality land, the potential for increased prductivity for small farmers issubstantial.

The Smal FkI rners-Contributions and Constraints

1.7 Recent statistics show that about 10 million of Colombia's 31milion inhabitants live in the rural sector, on about two million holdings.About 1.7 million farms (85 percent of the total) have less than 20 ha each,and 56 percent of these have less than the national average cultivated area of3 ha.

1.8 In producing basic foodstuffs for the domestic market, smallfanners play a vital role in Colombian agricultural self-sufficiency. Usingthe 1982 figures of the National Planning Department, it is estimated thatsmall firmers produce about 60 percent of Colombia!s basic foodstuffs(maize, wheat, beans, potaoes, cass( a, plantain, pancla, fruits, andvegetables) and about 20 percent of indusal raw materials derived fromagrculture. Farmers consume about 30 percent of their production and sellthe remaining 70 percent.

1.9 About 60 percent of the rural labor force is employed in small-scale agriculture - small landholdings concentrated in the Andean regions andin topical lowlands. Most of the small fam crops are cultivated wilthtraditional technology, and levels of productivity are low. On smallholdings, access to land is a limiig factor Incsng smal frmer income,therefor, will mean increasing productivity, whethe by improvedtechnology for production, processing, and marketing or by introducinghigher value crops.

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2. AGRICULTURAL T;ECNOLOGY DEVELOPM!ENTAND EXTENSION

Background

2.1 In the last decade, public sector funding for agriculturalresearch1 in Colombia has been equivalent to about 0.3 percent of theagricultural sector GDP (as compared with the 0.4 percent average recentlynoted for less developed, medium-large countries. In more developed,medium-large countries, the average is 2.2 percent). Private sector fundingfor agncultural research grew steadily during this period then flattened atnearly 0.2 percent of agricultural GDP. At 0.5 percent of agricultural GDP,total funding for agricultural research in 1991 was about US$35 million, withthe Colombian Agiculturl Institute (ICA) -then the main govemmentagency for agricultual research- investing about 60 percent of the total andthe remaining 40 percent coming from such semipublic and private entitiesincluding universities and growers assocations. In the private sector, mostresearch is commodity-specific and applied with a short gestation period.This tyut of research is likely to continue tD figuie prominently in privatelyfunded projects as mechanisms to stimulate private funding become effective.

2.2 New technology in Colombia has been generated by ICAanstituto Colombiano Agmopecuario) in the public sector, and in the privatesctor by producer organizations (such as Centro de Investigaciones de Cafd(CENICAFE), Federaci6n de Arroceros (FEDEARROZ), and the Centm deIvnestigacidn de la Ca*a (CENICANA) and by commercial seed andagrochemical companies. In addition, Centro Inernwcional de AgriculturaDpical (CIaf, situated in Colombia, and with Centro Interacional de laPapa (CT), and CIMMYT (Centro Intenational de Meoramiento de Matz y7iigo), supplies international support.

2.3 No single organizaion has beer responsible for extensionactivities. Larger farmers use the services of many private extensionagencies, agents, and (in the case of rice, coffee, cane, and cotton) relevantproducer organzations. While many have adopted modern technology, thereare still considerable inefficiencies-particularly in the excessive use ofchemical inputs.

2.4 A series of agencies have brought extension to small fiirmersin the past. Serving particular clients, these include Caja Agraria, a largeagricultural bank (supported by Loan No. 2909-CO), DRI (Loan No. 3250-CO), The Colombian Institute for Hydrology, Meteorology and LandPreparation (HIMAT) (Loan No. 3113-CO), and the Coffee Growers'Association (Loan No. 2433-CQ closed).

1 Research include. stagc, applied esch, validatdon and adst (adaptive)inrventios, and techology ftnaki:r (Annex 4).

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2.5 The basic shortcomings of research and extension in Colombiaare as follows.

a Lack of adequate advice to small farmers regarding sustainableproduction systems, which results in their profitability beingfar below the national average.

* Excessively high commercial agriculture production costslargely from inefficient and excessive use of inputs (mainlychemicals). This puts Colombian producers at a disadvarntagein export markets, leads to severe environmental pollution, andlowers profits.

* Irrigation technology that does not meet the needs of smallfirmers, causes major inefficiencies in water use, and leads toinadequate crop combinations and the use of low-value crops.

* Lack of adequate post-harvest technology leading to excessivelosses after harvesting, poor quality products, and the difficultyin improving standards of packaging and grading.

* Lack of adequate technology for foTestry and fisherydevelopment.

e A top down reah system that has not involved farmers inresearch development.

2.6 In 1989, as part of its decentalization initiative, Gover.mentbegan shifting responsibilities for planning and implementing agicultualdevelopment progams to municipalities and to departmental and regionalauthorities. In addition, Government took a series of steps to establish a newsystem for coordinating and funding agricultural reserch and extension, witha special emphasis on assisting small fbrmers.

National System for Agricultural Technology Transfer

2.7 In early 1989, Govenment established (by Decree No. 1946)the National System for Agricultumal lTchnology Thansfr (SlTh .P)1 Thispolicy statement sets out key sector objectives and institutional aranentsfor the coordination of research and extension to small frmers. WiLthin theSINT;F strucwre, MOA has a planning and coordinating role, cofinancesresearch, and serves as an umbrella to DRI, for its cofinancing of agricultualaxtnsion.

2.8 SITAP replaces ICAs lrely tp-down approah to appliedresearch, technology transfer, and extension with a participator, demand-

driven system in line with the ongoing process of decentralization. Farmerscan now make their needs known through mumicipal development plans, fromwhich local panels can identify research subprojects. Results of these

subprojects (if selected), and from ongoing research, are to be transtrred tothe firmers through existing extension services. Public and private sectorentities ard growers' associations will be able to obtain flinancial support forresearch through a competitive process designed to select subprojects thatbest meet local needs.

2.9 In 1991, Government established the National AgricultumalThchnology bansfer Program (the Program) to put SINTAP into effect. TheProgram is the central instrument in the Government's plans to modernizeand improve the competitiveness and incomes of Colombia's smallagricultual producers. Addressing the major constraints faicing the sector, itaims to turn the present systm into a coherent, functioning system withclearly established criteria for planning, implementation, and supervision ofreSearch and extension activities at the national, regional, and departmentalleels. The Program will help make sure that the identification of researchneeds takes place at the local level so that research projects address localpriorities. Finally, it will help ensure the quality of agriculhtual technology,both that generated by research at home and that which is transferred fromabroad. The Program will focus on developing sustainable fanning systems;promoting reduced and more efficient use of bio-chemicals; promofingintegrated pest management; and improving the management of irrigatedagriculture, fisheries, forestry, and post-harvest technologies.

2.10 The MOA will coordinate the Program using research andextension activities that include the private sector, govemment departments,and municipaliies (for a Program organization chart, (see Annex 7).

Colombin Agricultunal Research Institute (ICA)

2.11 In the past, ICA was the main govnment agency responsiblefor undertaking agricultural csearch and extension. By Decree No. 2141 ofDecember 30, 1992, ICA was downsized and split in two (see Annex 14).

2.12 ICA. With a staff of 1,600 (down from 6,700), ICA isfinanced from the national budget. About 800 staff are part of a large jointproject between ICA and the United SWes Departent of Agriculture for thecontrol and eradication of hoof-and-mouth disease. ICA is also responsiblefor the control of animal and plant disas and pests (about 400 staff), forquality control of agricultual inputs (about 200 staff), and for administeringspeal programs (with about 200 stall).

2.13 The Colombian Corporation for Agricultural lnestigation(CCIA). A joint public-private sector rsearch corporation with a staff ofabout 3,500, CaRs mandate is to undertake agricultual research undercontract from public and private sources. Although it is expected to befinancially self-sustaining over the long term, dunng this transition stage itwill be financed partly from xthe national budget. It will be eligible to solicitfimds from the Project in competition with producer associations,univeries, pnvate sector and CGIAR research centers. The Corporation

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has a largely private-sector Board chaired by ICNs General Manager, andhas recently appointed its chief executive. CCIA has taken over ICA's 13main research stations and 66 regional research centers and their staff.CCIA has more operational flexibility than a purely public sector entity. Itcan both give and receive contracts and its staff are not civil servants. It hassome 106 associate members from both the public and private sectors, suchas FENALCO, CENICAFE, FEDEARROZ and some of the 14 regionaldepartments. Associates are invited to take equity positions, and theirrepresentatives have seats on CCIA's Board. It is expected that associateswill submit research contracts they wish CCIA to undera}ke directly and it isexpected that the CCIA to be a major participant in agricultural technologydevelopment and adaptation financed under this project.

DRI and Extension

2.14 Recent legislation put the municipalities in charge of providingextension services bo farmers, either by establishing their own extension unitsUnidad Municipal de Asistencia Tdcnica Agropecuaria (UMATA), or bycontracting an agricultural technology service firm. To date, 550 UMATAshave been established. Where these have been operational for one year ormore, there is a marked improvement in the relevance and quality ofcxtension services p.uvided to fanrmes.

2.15 DRI, which is supported by the Bank and IDB under the RuralDevelopment Investment Program (RDIP), channels funds to municipalities tosupport a wide range of subprojects (including extension, rural roads, watersupply, watrshed protection, marketing, and fisheries). Establishment ofUMATAs; specific, joint extension subprojects conducted with the fimers(such as demonstration plots, field visits, and faer training); and thepreparation of municipal agricultural development plans are all cofinanced byDRI. The RDIP is now in its third year of implementation and is proceedingwell. Farmers are receiving more frequent and more systematic extensionadvice. What is now needed is advice. based on better research results Theproposed Project is designed to fill this gap.

Bank Strategy in the Agricultural Sector and Support for AgricuturalTechnology

2.16 Bank objectives in Colombia aTe to assist the Government inconsolidatng and deeening its structural reforms and to support private-sector-led growth by improving labor's skills and infrastructure and utilityseivices. The Bank gives pnority to imvestments for private sectordevelopment, government decentralization, and povert alleviation-withemphasis on ameliorating inefficiencies in key economic sectors. ln pmrsuitof these goals, Colombia's agricultual sector gives high priority to ruralpoverty alleviation and efficient growth. The Bank supports Colombia7santipovrty strategy of ovUall macroeconomic policies designed to encouragesustained economic growth and expanding demand for labor. Bank srategyto promote growth in the agricultual sector includes generating and

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promoting the adaptationi and transfer of new agriculturAl technology,assisting in the rationalization of the cxtension system, providing support forinfrastructure (mainly irrigation and rural roads), and promoting naturalresource management and protection. Its strategy is to focus on the needs ofsmall farmers and thereby to help reduce poverty.

Lessons from Previous Bank Involvement

2.17 The Colombia Agricultural Research and Extension Project(Loan 2303-CO) that closed on June 30, 1992 was designed to improve andexpand lCANs research activities to help Colombia raise its agricultural outputat competitive costs. The PCR noted that the project met its targets (such asbuilding and equipping research facilities at experimental statimns and trainingresearch personnel), thereby expanding Colombia's capacity to develop usefulagricultual technolkgy to improve and increase production.

2.18 The achievements of that project provide a strong foundationfor the proposed Agricultural Technology Development Project, and lessonsfrom it were incorporated in the Government's new research and ectensionpolicy and in the proposed Bank Project. Because past projects have oftenbeen overly academic and have not fully met the research needs of smallfarmers, under the proposed Project, small farmers will participate in theselection and implementation of future research projects. lb increase theefficiency and effectiveness of agricultural research, efforts of the nationalinstitutre formerly responsible for such resarch will be augmented by a broadprogram of agncultural technology transfer that incorporates the talents ofuniversities, NGOs, and private firms in the execution of research projects.Ib improve the relevance and quality of the technologies generated, researchfunded by the Project wiU be selected on the basis of predetermined criteriathat prioritize activities by type and location and promote interinstitutionalcollaboration. Given increasing problems of sustainable agriculture andenvironmental issues, one of the selection criteria will be that proposedactivities promote environmentally sound technologies, which will entailspecific trainig and skills to develop a "grien" sensitivity thrughout allresearch subprnjects.

Rationale for Bank Involvement

2.19 The most recent Country Assistance Strategy (Report R93-198,of November 19, 1993) for Colombia was presented to the Board onDecember 16, 1993. The proposed is fully consistent with the CAS. It isspecifically mentioned the CAS and would support thre of the broadobjectives for Colombia, private sector development, poverty reduction andinstitutional strengtheing.

2.20 There are several major reasons for the Bank to support theNational Agricultual lTchnology kansfer Program of which the proposedProject is a part. The Program's objecives of making Colombia'sagricultral sector more competitive is consistent with the Bank's continuous

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support of the Government's efforts to liberalize trade and modernize theagricultural sector. The Program also has a strong antipoverty focus,addressing the needs of small farmers. With the declining competitiveness ofColombian agriculture following apentura and the removal of taiffs andprotections, it is imperative that measures be taken immediately to increaseagricultural productivity. Finally, the Program supports an expanded role forthe private sector and Government decentralization which the Bank has beenassisting through a variety of programs that include the ongoing RuralDevelopment Investnent Program of agricultural extension activities.

2.21 With its extensive experience in helping governments todecentralize and encouraging increased participation by the private sector(both in Latin America and elsewhere), the Bank is uniquely placed to assistin the financing of this proposed Project; which will be integrated into theexnsion system supported under Loan 3250-CQ The Project mould buildon the Bank's experiences with the earlier Agricultural Research andExtension Project (Loan 2303-CO).

3. THE PROJECT

3.1 The Agricultural Technology Development Piroect (ATDP)was prepared by the Ministry of Agriculture and the National PlanningDepartmnt with support from the Bank. A preparation mission visitedColombia in February 1992, a preappraisal mission during April-May 1993,and an appraisal mission in July 1993. Negotiations were held inWashington from April 25-29, 1994. The Colombian Govenment team wasled by Dra. Claudia Salcedo, Minstry of Finance and Public Credit.

Objectives and Description

3.2 Objectives. A goal of the Project-and one consistent with theGovernment's apenura, decentraliztion, and privatization policies- is tobring about change in Colombia's agricultural research culture.laditionally, ithis has been public sector dominated, conservafive, elite and

drven by supply rather than demand. As part of Government's NationalAgricultural lcbhnology 1kansfr Program, the Project aims to achieve thefollowing objectives.

- Introduciin a new approach, in support of the National Systemfor Agricultural bchnology Development and Tlansfer,including with measures to build institutional capacity, whichwould promote the development and testing of technicalpackages especially appropriate for small fariners, and todivule new technology.

* Promotig private sector participation in agricultural research.

Imnproving the quality and efficiency of agriculual research byintoducing a demand-driven, competitie selection systm thatwould cofinance projects with universites and private andpublic sector entities.

* Supportn decentralization of agricultural rach andexknsion activities by strengthening regional centrs, trainingagicultdual etnsionists, and disseminating infomation.

* Revitalizing underused assets, both physical and human, thatpresently exist within Colombia7s research services stem.

Research funded under the Project would ultimately help to reduce ruralpoverty, increase rural employment, and improve the competitiveness ofColombiis agricultural producers.

3.3 Description. The prposed Project would finance a four-yearprogrm with two main components:

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* The technology development and adaptation componentwould include demand-dnven investments in strategic, applied,and adaptive research (including adjustment, validation, andpromotional activities).

* The institutional development component would includeestablishment of a small unit in the MOA to oversee Projectcoordination and promotion among the vanous participatingoganizations, and the Departmental Secretariats ofAgr-cultrues monitoring and quality control activities. Thisunit would also screen subprojects for technical quality and tocontract out approved subprojects. The MOA would besupported by a National Panel (which would make the selectionof subprojects for cofinancing and submit them to theBecutive Council), and, when installed, by regional panels(for subproject screening). Institutional development wouldalso entail: the establishment of Program coordination staff atthe regional level (which would carny out Program promotion);tchnical assistance to assist with implementation of asupesion system, a midterm review, and assessment of theProject's impact; taining in available technologies andsubproject preparation for research staff, field technicians, andother professionals; establishment of a University AssistantshipProgram to link academic studies with practical research work;and establishment of a system to meet agricultural technologyinfrmation requixements at the departmental and municipallevels.

Detiled Rbatures: Technology Development and Adaptation

3.4 This component would cover investnent in strategic, applied,and adaptive agricultural research throughout Colombia. The selection ofinvestment subprojects would be made by applying criteria reflectingpriorities for research (including those identified at the municipal andregional levels), limits on size and duration of subprojects, and amountof available funds in the Annual Operaing Plan. (The process by whichmsearch priorities are set, and research proposals are solicited and selected isdescribed below).

3.5 All research subprjects would include socioeconomic sthdiesand be limited to a maximum of tiree years and an average annual total costof US$50,000. In order to ensure the active pardcipation of a variety ofagmei in the Project, a Partcipang Entity's share of funded subprojectswould be no more than 60 percent of the total value at any one point. TheBank and the Bomwer agreed on crtera and trgets for 1995, these havebeen included in the Project's Operational Manual. Assurances wereobtained at negoiations that the MCU would implement the project as per theagreed Operational Manual and tat Government would send the Bank forappraoal any proposed changes to the Project's Operaonal Manual,

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including changes in the criteria and targets agreed upon during negotiationsand a Participating Entity's limitation to a maximum of 60 percent of thetotal value of approved subprojects at any one time (para. 6.1 (c) (i)).

3.6 Eligible subprojects would fall into the followingsubcomponents:

0 Strategic and applied research iestent Stategicresearch would encompass subprojects directed towardmedium-nm national priorities, and be expected to lead toapplied, and later adaptive, research. Applied researchfimding would support subprojects of potential immediate useto frmers (in such areas as sustainable production systems,integrated pest management, post-harvest technologies,fisheries, and environmental problems). It is expected thatfinancial support provided under the Project, although limited,would encourage partcipating entities to use their existingresea.ch staff and facilities more efficiently and help toencourage greater private imnvstment in agriculturl research.EstimaWt4! cost of this subcomponent is US$26.8 million.

Adaptive research inT chnology-transfersubprojects would include demonstration parcels, field days,and training. lbchnology generated at experimental stations,however, would be tested, adjusted, and approved underrpresentative ecological conditions before being transferred toextensionists. Research technology would hav-e to be validatedby both farmers and local UMATA staff, who would identifyfctors that might limit producion in each agroecological zoneand develop strategies for overcoming these constraints. Thesesubprojects would finance operational costs (such as gatheringinfomation, testing soil, providing inputs, transportation, visitswith farmers, supervision, and evaluation). Estimated cost isUS$26.8 million.

Detaied 1Fatures: institutional Development

3.7 Establish and support the Management and CoordinatingUnit MICU), the National hnel in the Manistry of Agriulture, andRgional Paneis. The MCU, which has already been established, reports tothe Council and is responsible for the overall coordination and supervion ofthe Program. The Project would finance start-up costs for office equipment,including computers, as well as salaries and operational costs and technicalassistance necessary for this unit to coordinate the overall Program. It wouldalso finance Project promotion and advertsing though publications.seminars, radio, and television advertising. MCU would manage thetechnical valuation and screening of subprojects. It would also prepare,sign, administer, and oversee +he technical and financial auditing ofcofinancing contracts with the implementing entities either directly or through

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a fiduciary. With the help of contracted personnel, this unit would monitorand evaluate the overall Program at the national, regional, and municipallevels (see Project Implementation -Section 4).

3.8 The MCU would be supported by a National Panel (which hasalready been established) of up to seven leaders in agriculture andagricultural research drawn from universities, the private sector, and theColombian government (para. 4.9). This panel would screen strategic andapplied research subproject proposals against established criteria andrecommend them for financial support. It would advise the Council whenchanges in the criteria and budget were desirable.

3.9 This suboomponent would also support the establishment andfinancing by MCU, of regional panels to screen subproject proposals first forsuch basic criteria as subproject size, cofinancing, regional quotas, andsubproject priorities (para. 4.10). Prescreening would reduce the wnrk of theNational Panel and help to begin the process of decentralization which theProgram supports as an overall goal.

3.10 The total cost of this component, including office equipment,computrs, salaries and operating supplies as well as technical assistance insubproject preparation and evaluation, is US$7.1 million.

3.11 In order to make sure that the system was responsive to theneeds of the region and the small famer, small coordination units would beestablished in each department (para. 4.10). These units would ensure thatthe municipal development plans were taken into account when maldng zonaldevelopment plans and that the annual investment program for research,adjustment, validation, extension, and training meet the needs of both smalfkrmers and the UMATAs in each area. Because this aspect is important tothe success of the Project, professional assistance would be supported at theregional level. The MCU would be responsible for the appointment,contracting and financing of the regional coordmation umts and the financingof vehicles (including boats) for technical staff involved in the Program.Assurances were obtained during negotiations that no expenditures would bemade for vehicles, including boats, until a plan has been prepared, acceptableto the Bank, for the acquisition of said vehicles and for making themavailable to the persons who would be using them for project purposes (PaM.6.1 (b) (1)). The total cost of this subcomponent is US$9.6 million.

3.12 Iechnical Assistance. Technical assistance is required in thefirst semester of the Project to help MCU fine-tune and implement thesupervision (including monitoring and evaluation) system for the cofinancedsubpzojects. Assurances were obtained dunng negotiations that MCU hireconsultants to undertake the following: not later than three months from theeffectivEness date to assist with the refining and implementation of the systemand within six months after effectiveness send a report to the Bank forcomment (pam. 6.1 (c) (ii)); not later than two years after the effectivenessdate prepare a project performance report to be used as a basis for a

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comprehensive midemn review (pam. 4.23). This performance report wouldassess the overall performance of the project, the functioning of the NationalPanel, the subproject selection process, the role of the regional panels, andwhat responsibilities for the Prgram could be transferred from MOA to theDePartmental Agricultural Secretariats or other approprate agencies ofTbrritorial Entities; toward the end of the Project, by January 1, 1999,

consultants would be hired to conduct an independent evaluation of both theProect and Program using sample case studies to assess the success to date,and to detneine whether or not the Government should prepare a fbllow-upproject (pama. 6.1 (c) (iii)). Draft lbrns of Refirence for technicalasistance to be undertakn in the first year of the project have bee a preparedand agreed upon during negotations (Annea 12). The estimated US$4.0million cost of this technical assistance is included in the totals of the othersubcomponentL

3.13 Tlainhn& The training activities under the Project fa intofour categories.

Tlaming in the management, formulation and implementationof the Program at the national, regional, and muimcipal(UMATA) leveL Allowances have been made for over 130taining events over the four-year Project period. Estimatedcost is US$1.7 million.

e Professional training in preparation and management ofsubprojects financed under the project for employees ofselected public and private institutions. An estimated 24workshops are planned. Estimated cost is US$0.4 million.

famiring of protssionals of public and private institutions(including universities) and UJMATAS in effective and relevanttechnologies. An estimated 240 training events are planned.Estimated cost is US$2.4 million.

* Draining of technical staff in the 1,030 municiities in themethodologies of technical assistance (extension) to the farmer.Over 700 events are planned. Estimated cost is US$5.7million.

3.14 Unidrsity Asistanisbp Program. This progm would helplink academic studies with practical research work and help students ataccredited filities of agronomy in Colombian universities complete theirgraduate work requirements in the M.A. degree, thereby helping to supplystaff for departent which lack people with postgraduate agriculturalqu lfcations. Actual research work would be done in conjunction withpecfic applied research subproects to be financed under the Project. An

allowance has been made for 80 students, selected by participatinguniversities, at an estmated base incremental cost of US$10,000 each. Adetailed desciption of this program will be included in the Operational

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Manual (a draft proposal is contained in Annex 14). The estimated totalincremental cost of this program is US$0.9 million.

3.15 lIaining programs have alrady been identified (Annea 14) and willbe included in the Operational Manual. Estimated total incremental cost fortraining is US$11.1 million.

3.16 Establish a Technology Information System. MQO wouldput in place a Tbchnology Inornmation System for agricultural technologicalpackages (including publications on the various packages available) whichwould serve the needs of the research system at the national, departmental,and municipal levels. During the fiLrst year of the Prject, a study would beundertaken to define the system's scope in terms of the needs of small

rmeres/IUMATAs (taking into account available technology packages andpublications), the needs of the regional research centers and the departments,ixedback information from the field, needs for equipment and materials,

annual operating costs, and prospects for sustainability once cofinancingceases. (Draft' rms of Reftrence for the study have beer. prepared andagreed at negotiations, see Annex 12).

3.17 Assurances were obtained during negotiations that MOAprepare a proposal for a detailed action plan for a technology infrmationsystem and submit it to the Bank for comment no later than six months aftereffectiveness (para. 6.1 (c) (iv)). Assurances were also obtained duringnegotiations that no expenditures, other than expenditures with respect toconsultant services, be made on this system without an action plan acceptableto both Government and the Bank (pam. 6.1 (b) (ii)). Estimated cost of thissubcomponent is US$2.6 million.

Sittus of Preparation: Project Year One (Including 1995 InestmentSubprojects)

3.18 The 1995 Annual Operating Plan (AOP) for both semesterswill cover about 200 research subprojects that meet agreed criteria andtargets, as well as the first year's costs of other Project components.Government has approved the 1995 budget of US$11.3 million, for theproject. The first tranche of proposals for cofinancing by the Project hasalready been prepared and initial screening completed. Demonstrating astrong private sector demand for research financing, some 450 out of 1,102proposals (41 percent) came from institutions outside Government (growersassociations, private companies, NGO's and universities2 ). About 370proposals which met the agreed criteria were sent to the National Panel forreview. Seventy subprojects, with a total investment value of US$5.7 million(first year investment of US$2.4 million) were selected by the Panel forsartwup in the first semester of 1995. Contractual arangements for thesesubprqects are presently underway. For the remaing 300 proposals sent to

2 Some Colombin unisities awe both public and pivatdely suppored.

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the Panel, about 130 more will be selected for startup in the second semesterof 1995.

3.19 Analysis of the source of the proposals received indicatedconsiderable scope for strengthening links between the public and privatesectors since only 15 of 1,102 subprojects were collaborative efforisnolvng different agencies. If appropnately prontized and channelled,Project funding could play an important role in broadening the scope ofprivate sector involvement and promoting joint public-private sectorcollaboration, thereby contributing to the ultimate goal of opening up theeconomy.

Project Costs

3.20 Ibtal Project oDsts are estimated at US$84 million equivalent,with a foreign exchange component of US$29.6 million (as detailed inAnnexes 1 and 2).3 The final allocation for technical assistance, research,validation, and adjustment subpjects would be determined by annualdmanad from potential beneficiaries and by the implementing agencies'capacity to implement subprojects. Costs were calculated using projectedJanuary 1995 pnces and include a physical contingency of 10 percent on allPriect management components. Expected pnce increases over thefinancing period were computed using Bank projections for international andlocal inflation dated May 1994. Physical and price contingencies totalUS$11.9 million for all components

Project F ;nancg

3.21 The pmposed Bank loan of US$51 million wrould finance 61pect of total Project costs equivaledt to 100 percent of the foreignexcharnge costs and 39 percent of local costs. The balance of Project costswould be financed by the National Government (US$22.3 million, or26 percent), and by participating unvesities and pnvate sector entities,(US$10.7 million, or 13 percent). See Funds Flow Chart (Annex 3).

3.22 The Republic of Colombia would be the Borrower. TheGovenment would make the proceeds of the loan availab': on a grant basistD MOA to finance Project components. MOA would finance themanagent, administration, tainig, and institutional strengthening ofMCU, the National Panel, the Regional Panels, and the regionalCoordination Units; the trminng of exeonists; the Univsity AssistantshipProgam; and the development of a technology infirmation system; andvhicls (mcluding boats) for regional technical staff. MOA would alsocofinance-together with each of the participating entities-strategic and applied

3 Annua cost figures sw fr the imreseh isbnent com4mnu1 m Anncx 2 ameestimatcs provided for planning purpoes oly and wll depend on demad.

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research, adjustment, and validation subprojects. See Cofinancing Matrix(Annex 2).

Procurement

3.23 Procurement of goods, works, and contracting of servicesfinanced by the Bank under the Project would follow procedures acceptableto the Bank. As applicable, standard bidding documents would be agreedupon and incorporated into the Operational Manual, to be used byimplementing agencies as the basis for procurement under the Project. Inexecuting its subprojects, CCIA is expected to procure like items undersingle annual contracts wherever possible, in order to achieve quantities-of-scale discounts. (Ihese requirements would be included in cofinancingcontracts between MOA and the participating entities).

3.24 A procurement specialist on staff of the MCU would reviewprocurement under the Project to ensure that these conditions described weremet. In addition, MCU would hire an independent auditor satisfctory to theBank to carry out a technical analysis of the procurement procedures underthe Project every six months. Audit reports would be forwarded to the Bank.During supervision missions, the Bank would sample contracts for review ofhow procurement was being implemented.

3.25 Goods, other than vehicles, laboratory and specializedagricultural equipment, would be procured under Iternational CompetitiveBidding (ICB) procedures for all contracts in excess of US$250,000.Whicles, laboratory and specialized agricultural equipment, and otherequipment, as may be agreed to with the Bank, would be procured underLimited Interational Bidding (LIB) on contracts above US$50,000.Vhicles, equipment, and materials valued at less than US$50,000 equivalentper order, would be purchased on the basis of price quotations from at leastthree eligible suppliers. Computers, equipment, machinery, vehicles, etc.will need to be procured and maintained for at least the first year ofoperaton. Civil works financed under the Research Investments componentwould also require contracts of less than US$50,000 to be awarded on thebasis of three price quotations from at least three qualified local contractors.The selection and appointment of consultants for studies and technicalassistance financed under the Project would be consistent with the August1981 Bank Guidelines for the Use of Consultants by Bank Borrowers and bythe Bank as Executing Agency.

3.26 Prior Review. In addition to the exceptions listed in the LoanAgreement (Part E, Section 2), all consultant contracts over US$100,000 forfirms and US$50,000 for individuals would be subject to prior riew by theBank For cofinanced imvestment subprojects, in view of the small size ofthe subprojects and the large number of participating entities, prior rnview bythe Bank, other than for ICB and LB, would not be practical. Therefore, inaccordance with the Operational Manual, the MCU's staff procurementspecialist would rwiew prcurement other than ICB and LIB, after the fact,

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on a sampling basis of at least one in ten of the subprojects financed underthe project. As for ICB and LIB procurement, there would be no priorregistration of bidders, no requirement for local agents, and no provisionregarding a minimum number of bidders. In order to address unacceptablediscrepances between Colombian procurement legislation and the Bankguidelines, the Project Agreement includes the follownmg special provisions:bids for goods would be evaluated on an as quoted c.i.f. basis for foreignbids and an ex-ifctory basis for local bids, and awards shall be made to thelowest evaluated responsive bidders. Foreign bidders and consultants wouldnot be xequired to ratify accreditation documents (power of attorney,company registration) with Colombian consulates, except for the purpose ofsigning a contract. Bidders would bear the responsibility for the accuracy oftranslations of any such documents into the Spanish language with no needfor certification by Colombian official agencies. Finally, all ICB and LIBprocurement would be done using Bank issued standard bidding documents,amended as necessary for the purposes of the project.

3.27 Assurances were obtained during negotiations that MCU, andthe participating entities would follow procurement procedures satisfactory tothe Bank, as outlined above (para. 6.1 (c) (v)).

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lible 3: Procurement of Goods and Services(US$ millions, including contingencies)

1'''-'~~~~~~~ ~~~~ ....... . .. >'. :t-.. .... :.'.

Research Inestments 53.6' 53.6

(26.8) (26.8)

Vieicles and Equipment 1.8 6.6' 8.4

(1.8) (4.9) (6.7)

Op CostsMatri & Supplies 1.7 b 1.7

(1.3) (1.3)Salaries and Labor andTravel Expeses 6.3 6.3

(4.3) (4.3)Ibchnical Assistancerinin 14. 14.0

(11.9) (11.9)

Ibtal 1.8 82.2 84.0

Finaced by Loan

Amowut (1.8) (49.2) (S5.0)

prcentage Share (60.7)

Note: Figures m pare_ess awe the espective dollar amounts financed under the

I lInludes Limited tmatiLonal Biddig adG Shoppingb No single item of prement w11 exceed US$25,000 and Local Shopping will

apply.0 Not subject to proment

I lundes conwlig services

Disbursements

3.28 Based on the standard disbursement profile fnr 1994 forColombia-Agriculture-when adjusted for retoctive financing and the use ofa Special Account (para. 3.32)-the proposed Bank loan of US$51 millionwould be disbursed over seven years.

3.29 The Bank would reimburse MOA for expenses related tDinstitutional strengthening of coordinating unit and regional centes, and forthe panel of experts, training, and technical assistance at a rate of 100percent for foregn expenditumes for equipment and vehicles (including boats),foreign consultants, and taig; and 85 percent for locally procured vehicles(icluding boats) and equipmrent, panel honorarums, consultants, andtAining. Estimated loan disbursement for these items is US$18.6 miTlion.

3.30 Salaries and inczemental opeating supplies would bereimbursed from the loan at a rate of 85 percent of costs in years one and

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two, 70 percent in year three, and 60 percent thereafter (estimated loandisbursenents of US$5.6 million). All subprojects would be cofinanced withparticipating public and private sector entities and subproject investment costswould be reimbursed at a rate of 100 percent of MCU's portion, up to amaximum of 50 percent of the total investmeni cost (with an estimated loandisbursement of US$26.8 million).

3.31 All disbursements from the loan, except for equipment andmaterials, are ecpected to be made against statements of expenditures(SOEs). ICB and LAB contracts greater than US$50,000 or more equivalent(where prior Bank rwiew will be required) would not be eligible for SOEs.The participating entities responsible for the procurement of goods andcontracting of services would maintain the SOE documentation. Based onSOEs, the minimum value for each disbursement request from the loan to theSpecial Account would be US$600,000. Retroactive financing of up toUS$5.1 million for eligible expenditures (made after July 31, 1994, but nomore than 12 months before signing) would be provided for under the loan.Eligible expenditues would have to follow procurement proceduresacceptable to the Bank. It was agreed at negotiations that MOA may seekthe assistance of one or more fiduciaries, acceptable to the Bank, to provideservices related to the management of funds for the contracted payments onrsearch subprojects (pan. 6.1. (c) (vi)). The Project is expected to becompleted by June 30, 2001, with a closing date of December 31, 2001.

3.32 The Borrower would establish a Special Account in US dollarswith the Banco de la Repdblica, acceptable to the Bank to cover eligibleBank expenditures under the loan. The Bank would iniitially deposit up toUS$1 million upon receipt of an initial withdrawal application. This couldlaer be increased to US$2 million (representing the avenage xpcted Loandisbursement for a four-month period) once cumulative disbursements fromthe loan reached US$6 million. Subsequent replenishment by the Bank intothe Special Account would foUow the procedures by which Bank fimds aredisbursed against actual expenditures.

Accountig and Audiing

3.33 To account for Project costs and financing, the MCU wouldestablish consolidated Project accounts and maintain other records as needed,including separate accounts and records of the total cost of financedsubprojects and the cost of individual Project activities. Cofinancingcontracts with participating entities would use accounting and auditingprocedures provided in the Operational Manual, which would be coordinatedwith the MCU's accounting system. These accounts are required to beadequate for the financial monitoring of such transactions as local and Bankfinancin&

3.34 Project accounts, the Special Account, and related financialinformation (induding supporting documentation for SOEs) would be auditedannually by an independent auditor acceptable to the Bank, in accordance

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with Bank auditing guidelines (Annex 9). Assurances were obtained duringnegotiations Ohat certified copies of the. audited consolidated Project accountsand audited Special Account in the Central Bank (including a separateopinion on the use of SOEs) be submitted annuaUy to the Bank not later thansix months after the close of the financial year, starting with the audit reportsfor the fiscal year ending December 31, 1995. Assurances were alsoobtained at negotiations that, if the financial audits identify significantirregularities in any participating entity, MOA would immediatly suspenddisbursements to that party and require it to arrange fbr special audits toensure that any irregularities were resolved before disbursements are resumed(pam. 6.1 (c) (vii)).

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4. PROJECT 1MPLEMENTATION

Organition and Management

4.1 'lb implement the Colombian Government's NationalAgricultural Ibchnology Program and this Agricultural IbehnologyDevelopment Project, a new structure was established in the MOA, and DRI(see Organization Chart, Annex 7). Within the MOA, there would be anExecutive Council supported by a Management Coordination Unit and aNational Panel. With the help of Project support, this new structure isexpected to be adequate for Project implementation. The existingAgricultumal Division in DRI would be strengthened as part of theGovernment's ongoing Rural Development Investment Program and as animportant complement to the overall Program, but it is not a part of thisproject.

4.2 As a condition of effectiveness, the MCU would have to haveminimum staff in place (in numbers and composition acceptable to the Bank)to initiate the Project (para. 6.1 (a) (i)). Assurances were obtained atnegotiations that Government would, at all times, retain in the MCU and theNational Panel, staff in numbers and composition satisfactory tD the Bank forefficient implementation of the Project, and that conditions for thereplacement of the coordinator of the MCU, and of National Panel members,would also be satisfactory to the Bank (paa. 6.1 (c) (viii)).

Operational Manual

4.3 The Operational Manual describes how to plan, identify,prepare, select, contract, finance, supervise, evaluate, and account for thesubprojects cofinanced with participating entities under the Project. TheBank and the Borrower have agreed on the final draft of the OperationalManual, which would be the worlkng document describing the Project,including access to financial assistance by participatng entilties and thegeneal administration of the Project. The Operational Manual could not,therefor, be changed without prior review by the Bank (para. 3.5). As acondition of disbursement, an Operational Manual acceptable to the Bankwould have to be issued by the EC and adopted by the MCU (para. 6.1 (a)O ))-

The Executive Council

4.4 The Executive Council has already been established. It is ledby the Vice Minister of Agnculture (Fblicy Coordnation) and mcludes theDiector of Devopment (MOA) and the heads of Colciencias and DRI andthe Agricultal Unit in the DNP. The fonction of the Council is to overseethe implementalion of the Project, to approve changes proposed by theNational Panel to Project cnteia or strategic tagets, to confirm the portfoioof subprojects selected after each semi-annual review by the National Panel(see para 4.16), tD approve Annual Operating Plans and Annual 'Wrk Plans,

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and to ensure that the MCU and DRI comply with the obligations stated intheir Annual Work Plans.

The Mtnagement Coordination Unit

4.5 The Management Coordination Unit (MCU), which is alreadyestablished, is responsible for administering, supervising, promoting andproviding related training for the Project; for preparing financial and progressreports; and for monitoring and evaluating the Project overall. As it ispresently defined, the MCU is the administrative arm of the Council andwould assist with the development of Project criteria, coordinat research andextension activities, promote wide participation, and ensure that the Projectcontinues on a path consistent with national goals. The MCU will also bethe main contact for the Bank for Project implementation.

4.6 The MCU has been given full authority and xesponsibility forcofinancing subprojects with participating entities in strategic, applied, andadaptive research. The MCU would send out semiannual imnitations forsubprojects; conduct a preliminary technical and financial review ofproposals; contract with implementing entities; supervise and monitorsubproject implementation; and ensure that procurement procedures used bythe participating entities were satisfactory to the Bank. Thc contractedpayments for the investment subprojects may be contracted to a fiduciary.

4.7 The MCUi would also coordinate and finance the miningprogram including the University Assistantship Progra. Short-term triningcourses would be prepared by the MCU, by regional centers, or byparticipating entities, who would identify course subjects, potentialinstructors, and an appropriate organizational setup for teaching. Some ofthe trining would be contracted out to specialists. The MCU would also beresponsible for the design and implementation of a technology intbrmationsystem. The MCU would prepare Annual Operating Plans and Annual WorkPlans for all work under its supervision, along with annual financialstatements. This Office would be responsible for the use of the Bank funds,including the processing of requests for reimbursement to replenish theSpecial Account.

4.8 The MCU is led by a Coordinator, who reports to the ViceMinister of Agriculture (Policy Coordination) in order to expedite decision-maling. This gives the MCU the authonty necessary for dealing with all theother entities in the sector and overseeing the implementation of the Project.In all, some 23 incremental staff would be required. Details of the MCU'sorganization structure and its tasks, authority, and responsibilities areavailable in the Project file (Annex 14).

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The National Panel

4.9 The National Panel (para. 3.8) has been appointed by theCouncil to review, select, validate, and adjust all research and trainingsubproject proposals to be implemented under the Project. The Panel wouldpresent the portfolio of selected subprojects to the Council for approval.Panel members would be contacted at a standard daily rate for an estimated15 days each per year. Contacts would be for two years with the possibilityof one extenion (in order to provide continuity). The National Panel wouldinclude at least four members from universities and the private sector andone person with environmental experience who could review researchsubprojects for their emironmental impact Regulations for the NationalPanel would be part of the Operational hianual and would stipulatespecifically that only subproject proposals that were enmirnmentally neutralor were aimed at remedying environmental damages would be considered.

Regional Panels and Coordination Unit

4.10 As part of the national decentrizaton objective, the Projectwould establish, after the first year of operation, regional panels to screenproposals and ensure that those selected are designed to meet regonalpriorities and the needs of the small farmer (pam. 3.9). Regional panelswould also set assessment critea and targets for their respective departmentscompatible with the corresponding critria provided in the OperationalManual. Each regional panel would contain up to five professionals whowould be appointed by the Council on recommendations from theDepartmental Agricultmral Secretaa. The Project would also financeprfessional coordination units at the field level to ensure that the project wasmeeting the needs of the small farmer (pam 3.11). Assurances wereobtained at negotiations that the MOA would, no later than within 6 monthsafter the date of effectveness, establish at least 3 regional panels and appointtheir members and at least 3 regional coordination units, and hire appropriatepersonnel and no later than twelve months after the date of effectivenessprepare a plan, acceptable to the Bank, for the establishment of additionalunits (para. 6.1 (c) (ix)).

Processn Subprojects Fianced Under the Project

4.11 The system for the identification, processing and approval ofsubprojects for cofinancing is based on open competition for available fumds-based on established portfolio selection critria-among such sector enties asuniversities and growers associations and the CCIA. Criteria would includesmal farmer and regional needs, pivat sector and joint venturepartcipation, and relevance to stategic research goals, and would be speledout in the Operational Manual.

4.12 lb ensure frmer participation, agricultu development planswoud be prepared by the UMAMAs following meetings between the farmers,UMATA tcnical staff, and the mayor of each mumicipality. Such meetngs

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would provide a forum for farmers to express their research and ectensionneeds. Development plans would also identify those areas and crops liklly toyield increased production and income with research adaptation or technologytransfer.

4.13 Plans would be consolidated at the departmental level intooverall zonal plans. Identified needs (including training) would then beaddressed by means of discrete subprojects, to be financed under the Project.With the assistance of the coordination staff, it is envisaged that, oncedecentralized, Departmental Agricultural Secretariats would invite proposalsfrom research entities to undertake these subprojects, and implementingentities would submit cofinancing proposals to the appropriate DepartmentalAgricultural Secretariat using a standard fonn, see Annex 5. Pmposalswould then be screened by regional panels to ensure that they conformedwith crieria stated in the invitation letter and oginated at the municipallevel. Accepted proposals would be forwarded to the MCU.

4.14 Under the project, the MCU would also send letters, eachyear, m August and m February to participating and prospective entitiesinviting proposals for strtegic and applied research, adjustment, validation,technology transfer, and training subprojects for possible cofinancing. Thisinvitation letter would state basic criteria for subprojects, in accordance withthe Operational Manual, as well as the Project's investment priorities for thecoming semester.

4.15 The MCU would enter proposals recved into a database andeliminate: duplicates, technically unacceptable proposals, those whoseduration would be more an three years or whose average annual costeeeded US$50,000; those that requested financing greater than themaximum percentage allowed, and those that did not address the basicProject objective of helping the small farmer. The MCU would then apply ascore to the remaining proposals for quality and reect those that fill belowthe established minimum. It would summarize the remaining proposals bydepartment, compare the total value and financing required to detemine ifmore screening was required to reduce the value of requests to no greateran three times the level of funds available If needed, further screning

would be done by scoring and by distributing selections to ensure a rationaldepartmental mix. Finally, a list of recommended proposals would be senton to the National Panel.

4.16 The National Panel would review the portfolio received frmthe MCU to screen it for departmental mix, ovaall assessment criteia,degree of participation by the pnvate sector, and relevance to small farmersThe National Panel would send a final portfolio of subprojects to theExecutive Council for approval. The Council would apprcve the overallportfolio for the semester and advise the MCU regarding which subproectshad been selected. Once Government budgetary contibution was secured,MOA would sign contuacts with the participating entities and make paymentsaccording to the schedule set forth in the contact. If acual Project resources

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differ from approved budget allocations, the National Panel would beresponsible for making changes in the approved portfolio of subprojects.

4.17 For the final portfolio of approved proposal, MCU would sendout Letters of Intent confirming the level of cofinancing and amount offinancial support that would be supplied to implementing entities. Replyletters would be sent out indicating which subprojects were not selected. Foreach subproject, the MCU would prepare cofinancing contracts betweenMOA and the participating entity.

4.18 As part of the decentrlization process, certain subprojectselection, approval, and cofinancing procedures would be handled at thedeparmental level. Regional Panels, Coordination Staff, and DepartmentalAgricultural Secretariats would set the assessment criteria and annualimvestment trgets for their respective departments. Durng the midtErmreviw an assessment would be made on what Project responsibilities couldbe transfrred to the Departmental Agricultural Secretariats (para. 4.23).

Preparing Annual Operating and Work Plans

4.19 The MCU would prepare an annual operating plan for theProject in accordance with normal Government timing and procedures.Based on available funds and on demand, amounts would be included forglobal investment in research, validation, adjustment, and trainingsubprojects. Assurances were obtained during negotiations that the MCUwould send to the Bank for review (by October 31 of each year) the proposedAnnual Operating and Work Plans to be undertakn by the MCU under theProject far the coming year and a report on the adequacy of theportfoliomanagement criteria (para. 6.1 (c) (x)).

4.20 In order to ensure maximum cooperation between interationaland Colombian research centers, prionty would be given to joint research ofmutual interest.' Management links among these organizations exist, in thatthe General Manager of CCIA is a member of the Board of Ikustees ofCIAT, and CIAT is a member of CCIA and has the same rights as any othernational member. While promoting maximum cooperation between researchcenters and corporations, subproject proposal submissions will be screened tomake sure they do not duplicate work being done internationally or elsewherein Colombia.

Emvironmenl Impact, Evaluation, Monitoring, and Supervision

4.21 The Project would promote research that would increaseagriculturl productivity and also improe the environment. Yet almost any

4 FEDEARROZ already has links to the new Cwpomucidn Colombiana InvsigacidnAgmpecuaria (CCIJA) (panL 2.13) and to CLAI. CCIA and CIAT are conducting joiritreseareb on cassava poducton.. Joint research is also being conducted by CCIA and tvwoother Latin American centers, CIP and CIMMYT

- 26 -

development activity distubs the land surface. While the area involved maybe small, the cumulative effect of many small disturbances can be substantial.The MCU and Panel would screen proposals for environmental impact(Annex 11). The MCU would maintain a monitoring system to evaluatethose impacts in thie field and to monitor the promotion of sustainableagricultural practices. The MCU would prepare short reports on eachsubproject under implementation (Annex 6). The implementing entity wouldprepare a report upon completion of each subproject which would beevaluated by the MCU. This subproject evaluation would compare actualresults with the subproject's objectivs using the baseline data in the originalproposal (Annea 5). In order to ensure adequate monitoring and supervision,assurances were obtained at negotiations that the MCU would appointconsultants, not later than tee months from the date of effectiveness (underterms of reErence satisfactory to the Bank) to refine and implement themonitoring and evaluation system for the Project. Not later than six monthsafter effectiveness, the MCU would pvide the Bank with a report on thatsystem for comments (paa. 3.12).

4.22 The MCU would also submit an annual progress rport to theBank (due February 28) and two--three page progress reports (due August31 and February 28 of each year) identifying the major issues, problems, andactions taken in the planning and implementation of the Project. Thesereports 'wold indlude the status of each component and discuss any problemsthat might arise (m such areas as provsion of counterpart funds, pace oftechnology adaptation, the Annual Wbrk Plan's effectiveness of research andextension services, reasonableness o performance, and monitoring criteria),which could impede Implementation. This information would also help theBank and the MCU to plan the timing and composition of supervisorymissions.

4.23 Tb evaluate the Project, the MCU would hire consultants(under tms of reference satisfactory to the Bank) to prepare a midtermperformance report (pama. 3.12). No later than 30 months after theeffeceveness date, and using the afementioned report as a basis, theBomwer wuld undertae jointly with the Bank, a Midterm review andevaluation of the activities caried out under the project and the resultsachieved. This review would include, but not limited to: (a) the ftmctioningof the Coordinating Unit, the Executive Council, the Panel, the RegionalPanels and the Coordination Units; (b) all aspects of the carrying out ofapproved Subprojects, particulady the selection process and the response ofthe privait Sector; (c) the efficacy of the provisions of the OperationalManual and the application theeof; and (d) the determination of which of theresponsibilites of the Borrwe under the Pram could be transfirced tothe Dqartmental A u l Secretariats or other appropriate agencies ofTeritorial Entities. Assurances wer obtained during negotiations that theabove midterm review would take place no later than 30 months after thedate of effectiveness and once the renew has been completed all requiredadjustments, as well as changes to the Opeational Manual agreeable to theBank would be introduced (pama. 6.1 (c) (xi)).

- 27 -

4.24 lbwards the end of the Project, by January 1, 1999,consultants would be hired to assess the overall success of the Project and todetermine whether and when a second phase was needed. Reviewers woulduse case studies to assess the Project's success in developing and integratinglinks between strategic and applied research, adjustment and validation, andtechnology transfer and extension and in promoting jomt research andtranskr activities between the puolic sector, growers associations,universities, and other private sector entities (para. 3.12).

4.25 Assurances were obtained from the Borrower that MOA wouldprepare and furnish to the Bank, no later than six months after close of theproject, a plan for the future operation of the system of financing agriculturalresearch to be put in place by this project, including the institutionaldevelopment undertaken. The Borrower has also agreed to give the Bank areasonable opportunity to exchange views with the Borrower on such a planand thereafter to carry out the plan, taking into account the Bank's comments(6.1 (c) (xii)).

- 28 -

S. BENEFITS AND RISKS

Benefits

5.1 The research system developed under the Project would bemore responsive to the needs of small producers. Although specific benefitsfrom this first phase of the Project cannot yet be quantified, it is estimatedthat it could help some 350,000 farmers by improving yields, helping tointroduce higher value crops, and promoting enviromnmentally sound practices.The introduction of a competitive research system, should also increase theefficiency of research. The financing of operating costs would helpColombian agricultural researchers make better use of existing physical andhuman capital and, aver the long term, the use of improved technology willincrease incomes and employment for firmers, laborers, and the ruralpopulation at large.

Risks

5.2 The Project's main nsks derive from its magitude to establishan integrated, nationwide agricultural research and technology tansferpr-gram, involving up to 1,000 municipalities, 31 Departmental AgriculturalSecretariats, and a variety of universities, NGOs and private grwersassociations.

5.3 The risk that research results may not be effecive is a riskinherent to any research program. In this case, the Project could fail to meetthe needs of small firmers. The overall Program, therefore, has beendesigned to link research and extension services and to screen proposals toensure they will benefit the small farmers. Specific seminual targets willalso be set for financing subprojects that originate from the municipalitiesAnother mitigating factor is that in Colombia, the Project will be building onan existing DRI extension systm that works very well. It is important,therefore, that DRI continue to cofinance ectension services under its ongoiqgproject.

5.4 Government has established a special high-level Execudve Councilchaired by the Vice Minister of Agricuture (Pblicy Coordination) to resolveany implementation problems that might arise and to apprve the Project'sannual opeating plans. Tb reduce the nsk of stat-up delay, the inve ntprogram for the first semester of the Project's first year (1995) includes some70 actual subprojects proposed by potential Participating Entiies andaccepted by the Panel, cofinancing contracts for these subprojects arepresently being prepared.

- 29 -

Project Sustainability

5.5 The Government's continued commitment to the developmentof a new system for coordinating and funding agricultural research andextension, with the ultimate aim of modernizing and increasing thecompetitiveness of the sector, bodes well for the future of the Project. Byfinancing incremental operating costs within the existing infrastructure andresearch community, the Project should generate an increase in researchactivities. The Project will also increase the efficiency of investments inagricultural research in Colombia, and private sector involvement (para. 3.2).

5.6 lb further enhance the sustainability of the Project, thefollowing mechanisms were included in the design.

* Professional assistance would be provided to the departments tocoordinate research and extension activities, and training would beprovided for field technicians and other professionals at the UMATAlevel (paras. 3.11 and 3.13).

* The Executive Council, MCU, and DRI's Agricultural Division willmaintain administrative links to support Project and Program activities(para. 4. 1).

* The Borrower, jointly with the Bank would conduct a mid-termreview to examine results and propose adjustments to Projectobjectives wherever necessary (pama. 4.23).

* External consultants would begin a study in the fifth year of theProject to evaluate the Project's success and assess the need for andbest timing of a second phase (para. 3.12).

* The Borrower would prepare, within six months after the close of theproject, a plan for the future operation of the project, discuss the planwith the Bank and, thereafter, implement it (para. 4.25).

- 30 -

6. AGREEMENIS REACHED AND RECOMMENDATION

6.1 During negotiations of the proposed Loan, agreement from theGovernment of Colombia was reached on the following main actions.

(a) Condition of Effectiveness: (i) Initial key staff of the MCU, withqualifications and experience satisfactory to the Bank, had beenappointed (para. 4.2); and (ii) an Operational Manual had beendeemed acceptable to the Bank and issued by the EC and adopted bythe MCU (pam. 4.3)

(b) Conditions of Disbursements: the Bank would not disburse againstexpenditures for: (i) vehicles, including boats, until an acceptableplan has been prepared and submitted to the Bank (para. 3.11); and(ii) the technology information system, other than expenditures withrespect to consultant services, until a mutually agreeable, detailedaction plan had been accepted by both Government and the Bank(par 3.17).

(c) Other Agreements and Assurances: (i) MCU would implement theproject as per the OM and Government would approve, and submitfor Bank approval, any proposed changes to the OM (para. 3.5). (ii)Consultants would be contracted by MCU not later than: threemonths from the effectiveness date, to assist the MCU with theimplementation of the supervision system for the Project and send areport on their findings and recommendations to the Bank forcomment within six months from the effectiveness date (para. 3.12).(iii) Tw years from the effectiveness date, to prepare a performancereport; and by January 1, 1999, and to assess the Project's success todate and to determine whether or not Government should follow-upwith a second phase of the Project (para. 3.12). (iv) MCU wouldprepare a proposal for a detailed action plan for a technologyinformation system and submit it to the Bank for comment no laterthan six months from the effectiveness date (para. 3.17). (v)Govemment and the participating entities would follow procurementprocedures satisfactory to the Bank (para. 3.27). (vi) MOA may seekthe assistance of one or more fiduciaries, acceptable to the Bank(pam. 3.31). (vii) The accounting and audit requirements described inpara. 3.33 and 3.34 would be followed. (viii) Government wouldretain in the MCU, and the National Panel, persons in numbers andcomposition satisfactory to the Bank for the efficient implementationof the Project and would not change the Coordinator of the MCU, orappointed National Panel members, without prior Bank approval(para. 4.2). (ix) within 6 months from the effectiveness date, MOAwould establish at least 3 regional panels and at least 3 regionalcoordination units and appoint personnel and, no later than 12 monthsafter the effectiveness date, prepare a plan, acceptable to the Bank,for the establishment of additional units (para. 4.10). (x) The MCU

- 31 -

would submit Annual Operating and Work Plans for Project activitiesto the Bank for review by October 31 of each year (para. 4.19). (xi)No later than 30 months from the effectiveness date, the Borrower,jointly with the Bank, would carry out a comprehensive midtermreview and thereafter introduce all necessary changes to the Project(para. 4.23). (xii) MOA would prepare a plan, within six monthsafter project closing, fir the future operation of the project anddiscuss this plan with the Bank, and, thereafter, implement it (para.4.25).

Recommendation

6.2 Using the terms and conditions set forth in Sections 1 to 6 ofthis report, the Agricultural TIbchnology Development Project, as proposed,constitutes a suitable basis for a World Bank loan of US$51.0 million to theRepublic of Colombia.

-32-

Arex 1

COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECT

LOAN AND PROJECT SUtNARY COSTS

-----USS Millons---

Local Foreign Totat X of Totat

1/

Research Investments

- Research Projects 18.75 8.03 26.75 31.88

- Technology Transfer 18.75 8.03 26.78 31.88

Management and Coordination - MIIAG

- Mgmt.5 AdafnA& Panel 3.24 1.39 4.63 5.51

- Program Promotion 0.78 0.33 1.11 1.32

-Supervision 0.97 0.41 1.38 1.65

-Sub-TotaL - MCU 4.99 2.14 7.13 8.48

- Strengthening Regions 2.89 6.74 9.63 11.46

- Training 7.17 3.07 10.24 12.19

- Research Retated Trn'g 0463 0.27 0.90 1.07

-Information System 1.28 1.28 2.55 3.04

Total Project Cost 54.44 29.56 84.00 100.00

I/ Estimted direct and Indirect foreign exchange costs of the progrm.

Financing Plan

National Govermment Inc. CCIA 22.29 22.29 26.54

Universities and Private Sector 10.71 10.71 12.75

IBRD Loan 21.44 29.56 51.00 60.71

Bank FY 1995 1996 1997 1998 1999 2000 2001

DISBURSEMENTS X 12.00 24.00 40.00 52.00 68.00 88.00 100.00

- Anual Mn 6.12 6.12 8.16 6.12 8.16 10.20 6.12

- Cumzulative Mn 6.12 12.24 20.40 26.52 34.68 44.8 51.00

C:XA1PSARfANNEX U.IK

-33-

Amis 2

ASI!WLTUAL TECIOL DEVELOPUT PROJECTPROJECT SUIMP Ws BY VW

----USS NhlLIcs--

Tar I YTr 2 Yer 3 Tor 4 Total 2Remrch Inveatments

- Re.ea.rc Projects 3.01 6.13 7.83 9.31 26.78 31.16- Tachnology Truefer 3.01 6.13 7.83 9.1 26.78 31.16

ng_t md Coordinstion- Nwt. Adin.& Pwl 1.17 1.15 1.16 1.13 4.63 5.51- Prgrm Promothmn 0.54 0.22 0.18 0.17 1.11 1.32- tiwrveiin 0.40 0.J 0.42 0.30 1.38 1.15- St-Ttal, - NM 2.12 1.63 1.78 1.10 7.13 8.48

- Stru'utheninr tlwo 3.66 3.91 0.90 0.94 9.3 11.46- Training 2.69 2.57 2.78 2.20 10.24 12.19- REaorech Rlated Trn'g 0.20 0.20 0.21 0.21 0.90 1.07- lnfomt1on stog 0.31 0.71 0.77 0.77 2.55 3.04

Total Projoect bast 15.29 21.29 22.09 5.34 84.00 100.00

COFINANCING MATRIXIqAtm. Nai

Agencise NME Lom_ _.._ __._ ............. _______. _____............... _------------------

Managemet mi Coordinatfin- Nt.& AdmIn.& Pael 100 85 Il- Training 100 05 I/- Proorm Promotion 100 65 11- Srvision 100 85 1/- infoatlon Systa 100 85 11- Reserch Projects 21 50- Tadinlogy Transftr 2/ 50- Rteserch Rotsted Trn'g 100 a5 11- Strengthening eogions 100 as5 I

1/ The Denk an wmoutd finance 100 of the foreign costs mid 65 of the Local costa ofgoods3 technal assistance and training in the coordinating uit. It would also fin*6 2 -n the incrmenta operating costs of the uaft in years I and 2, 701 In yesr 3,wd 602 in year 4.

V/ The llr loan would finane 1OO of NA's tare of the totat Investmnt costs of echrearch usprojects. NRM mId negotiate Iv of contribution on each Aiprojectwith the participating entities ip to a mximum of 50 2.

Il I -

-- -- - - - -- - - - -- - -- - -- -- - -- - -- - - - - - - -- - -- --- -

I xamNv

-I--~~~~~~~~£

-35-

ANNEX 4

COLOMBIA

AGRICULTURAL TECiNOLOGY DEVELOPIINT PROJECT

DEFINIT.ONS

Basic and Strategic Research. In conventional terminology, basicwresearch is no immediate practical goal other than to incrase knowledge.'Strategic' research uses the results of past basic research to help provideanswas to a strategic goal even though those answers may not beimmediately applicable (applied).

Applied Research is research whose findings have the potential forimmediate application by farmers.

Adjustment and Validation are processes by which applied research is line-tned, adjusted and confirmed as being appropriate for specific localconditions. It is often conducted on-fam and lmown as adaptive research.

Technology Transfer is the diffusion process by which technology is passedon to field professionals (e.g., in the UMATAs and gremio extensionservices). It utilizs meetings, field days, radio, television, and publicationstD increase the awareness of these professionals in available technology.

Extension is the process by which field professionals and their tecnicalsupport staff provide farmers with advisory services. This involves utilizingthe findings of both applied and adaptive research diffused ffirough thetechnology tnsfer process. These findings are passed on to farmers bydirect contact. In Colombia the process is often referred to as "technicalassistance'.

-36- ANNEX 5

INIISTERIO DE AGRSCULTUPA

?RORATTA

roMuLARro PARA LA PRESENTACION DE PROTECTOSContnido eBs Bieo

NOTAs UtIlice Ice anexos qua considere necosarLou en cada urie de lon nwuL rales,para hae-r una adecuada promentaci6n de proyecto.

TWVO OR ISOTICTOt

3IVWnACOW EASICA ____ INVTCION APUCAD^ _ V^LIACION Y AIUf DE TCOLOGA

TAMPDWCIA Ol TECSOLGL __ CAPACMACIO.!__ APOTO a LA AMDC O14FORMACION TEC.VOLOOCA

CoOco OArl4 DEL CEPATAJM&eO NUV4ERO SECUDCIAL DEL noYWTO_ _ _- a, dimad pM Is wInAul da .magailmi

PRONATTA

FORMUMLARIO PAA LAl PPESE)AXACIOH DE PROTECTOSConteando MS *ico

NOTA: Utilice lox anexos qua costidare anceaarios an cada uno de los zwmeralms,par. hacer una adecuada prosentaci6n del proyecto.

1. NOlIERE DIML PROTECTO

2. EXIDAD RESPONSABRL

3. DXRZCTOR DEL PROYECTO

4. PLANHTEAXIETO DEL PROLE4A _

5 . DSESCRIPCION DEL PROYECTO

5.1 JUSTIFICACION DEL PROTECTO

ANNEC S

5.2 ODJETZVOS DEL PROYECTO ____________________

5 *3 KCETODOLOGIA PARA Lk L-TECUCION DEL PROYECTO_____________

5 *4 ACTI-7ZDADES PRINCIPALES Y CRONOGRAMJver anexo No 1

5 *5 LOCI.LIZAJCION GEOGRAPI CA. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

5.*6 PERIODO DC EJECUCION DEL PRCYECTO_________________

5.7 RESULTADOS ESPERADOS Y HETAS rISICAS_________________

5.8 INDICADORZS DE PROGRESO _____________________

-38-ANNEXS

S .9 ?NJoRs DE ILVANCE

S .10 DZNFICIJRIOSDELPROYECTO

5 .11 n=-RREACION CON PRODUCTORES

S. i62 P,OcEso DE TRms5FERICiA (Role para proyectos de generaci6n de t.cnologia)

6. e COSTOS DEL PROYrCTOVer anexa No 2

7. * XDLXOGRA?T

-39-:

AKiO CRONOGRAA DE ACTIVIDADE5

AND I AND 2 ANO 3

yule. vuz; . ?Xzu. TAZu. tRIM. TRIM. tutu. THaw. luau. TRIM. TRim. m3.

ACTIVIDADES a 1 * a' a

-40- ANNEXS

ANDNO 2

PRESUPUESTO DE GASTOS4oMSqE DEL PROV!CTO

ENTMOO ICESPONSALW.

ANO I I WO 2 _ ANC a

I RpP PRONATrA _N IPP. PRONATTA HMiM R.P .RONATrA HIM TW.seRVicIos PE!SONALES

A. TOTAL SERVIOOS PEq3ONALSO 0 01 0 a 0 a

TOTSA GCST-NS ES . . 0

[TOTL A1.. ____ . o

IAToS 1 CAPTA _

<c TOTA GATS AIA. 0a .~ a a O ~

B | 0 _~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

PVONATT ' eawum d . eam,,lmlArtrarl.davonitao hw0iA. otmwdm s'l

TEnA A. ftbw a raU.aommlemlodoo 0 U Urym CW 0a lpa.

PrAL ---

rSTOS~0 De CAPITAL a I ai I 3 i

L.TOAS CFJP%M S DE ^X 1O |Id 0ubr1 dOe Ixrom an _nesa oe Voo eI

ER6 Jf edg aS de Cap dzPlc kwsbca is r - cin deis mwrmares are * nrs d-1oycs

ANNEX 6

COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOPMNT PROJECT

CHECKLIST FOR SUBPROJECT MONlTORGAND EVALUATION REPORTS

A. MONITORING

1. 1tle of Project.2. Executing Agency.3. Date of monitoring visit.4. Months since project stated.5. Monitoring report number.6. Monitoring carried out by.7. Program of monitoring visit.8. Objectives of project.9. Acceptability of methodology being used.10. State of progress in relation to operating plan time frame.11. Effectiveness of collaboration between agencies involved in the

project12. What linkages have been established with potential

beneficiaries?13. Status of project in terms of its 'indicators'.14. Expenditure compared with budget, since initiation of projecL15. Major current problemslconstaints impending progress.16. Recommended actions to overcome problemstconstraints:

(a) Executing Agency(b) Coordinating Unit

17. Are ther any specific issues to be addressed by the nextmonitoring exercise?

B. EVALUATION REPORT

1. lde of Project.2. Project Leader.3. Executing agency and unit4. Start and finish dates for project.5. Date of evaluation.6. Evaluation carried out by.7. Original objectives of the project.8. Was the proposed methodology implemented?9. HIow was the collaboration between agencies involved in the

project?10. Was the proposed methodology implemnted?11. Were project reports submitted on schedule?

-42- ANNEX 6

COLOMIA

AGRICULTURAL TECHNOLOGY DEVELOPMNT PROJECT

B. EVALUATION REPORT (continued)

12. How did actual expendiure compare with the budget?13. Who are the expected beneficiaries and how will the project

results be transmitted to them?14. How did the project perform in terms of its defined indicators

of progress?15. Were there are any problems encountered that constained the

progress or success of the project?16. What steps can be taken to avoid repetition of any items listed

in (15)?17. Is there any follow-up or extension for the project tt the

evaluation team recommends?

COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECr

ORGANIZATION CHART FOR NATIONAL AGRICULTURE TECHNOLOGY TRANSFER PROGRAM

EXECUJTIVE COtMCIL M~ INISTRY OF AGRICULIWUE RGOA; | { CO~~~~~~~~~~~~~VE INITSl

| S _ l l ~~~~~~VICE M1INISTER ll _l

SUB-DIRECTRATES I AIARICULTUIALCOOROINATING UNIT *FINANCIAL SECRETAtIATS

(NO.) - *TECHNOLOGYTRANSFER-

AGRI~~~~~~~~~~| REGIONA^L lPAIIELS nd-

WODI, UNITS

-- ~r ----- |REGIONAL RESEARC99

CENER

L'JI7A2t, 19

-44-

COLOMBIA Annex 8AGRICULTURAL

TECHNOLOGY DEVELOPMENTPROJECT

KEY PERFORMANCE INDICATORS

Appraisal Twrgt at *t __ _

Project SupervIslon Actual % of % of TarmaItom Unit Complbtion Date Achieve. Total To Dote

_mm/dd/yr) (mmlddlvr)

Investmonts In Reearoh IUS*0000 28,870- Loan Support as a % of Total Inv. % 60- Portfolo Mii

- Aimed at Smal Farmers* Private Sector % 60- Joint Ventures %

Investments In Adaptive Research IUS$000) 28.870 _

- Loan Suppot as % ot Total Inv. % o W _- Portfolio Mbi _

- Aimed at Small Farmer _

- Private Sector % Go60- Joint Venture _ ___

- Tochnicians at Umatas events 720-_Cost (US$000) 6.700 _ I

- Tralning the Traine eents 240-Cost (US$OOO) 2.400 _

- Project Prepartion and Mgmt. eventa 24C _ ost (US$000) 400

- Project Management events 132-Cost l(USOOO0) 1.700 _

- Aed tantship Prom no. of Part. soCost (US$000) 800 _

;-r*motion |- Newspaper ads no. 120- Rado Ads no. 1.920 .- Pubic Medngo no. 24- Bulletins no. lei

Page 0

ANNEX 9

COLOMIA

AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECT

AUDIT REQUIREN(EN¶S

Documentation for Audit of Consolidated Progam Accounts

1. MOA/MCU would naintain a data-base accounting systemrecording the total cost of subprojects financed under the project, the amountfinanced and paid by MOA and, also, the costs incured by MCA in hieinstitutional strengt g component.

2. MOA.MCU would submit to the Genment's ComptrollerGeneral for audit by March 31 of each year the Iblkwing inirmation on theproject accounts:

(a) overal consolidated statement of sources and application offimds, with comments on the most significant changes withregard to the previous year;

(b) a report on its system of internal control (both financil andoperational);

(c) a report on the corective actions kn in response to theopinions and recommendations made by the auditor in thereport of the previous period;

(d) a report and its comments on the movement of the specialaccount aing into consideration the time intervals between thedate of ependitues, approval of disbUrsements, and WiLsrto participating municipalities and executing agencies;

(e) a report showing and analyzing budget eocution during theyear, compared with initial opriations and budgetexecution during the previous years; and

(f) all documentation supporting the statement of expenditures.

Content of the Audit Reports

3. The auditorDs report should provide the audited consolidatedfinancial statement for the project and express an opinion on the fairness withwhich they are pxesented. The auditor would also report on:

(a) compliance by MCA with its obligations under the project Thbiswould be covered in the audit of project accounts, SOEs andspecial accounts,);

-46-

ANNEX 9

(a) compliance by MOA with its obligatons under the projct Thiswould be covered in the audit of project accounts, SOEs andupecial accounts,';

(b) tie system of internal control (financial and opwAtions);

(c) correctve measures aken by MOA in mesponse to obsevationsand recommendations made in the previous report; and

(d) the accounting system used.

lmng of of Audi Reports

4. MOA should forward to the Bank the audit report(s) no lat1rthan six months afker the end of the Colombian fiscal year.

MICIARMANN9AW

-47-ANNEX 10

COLOMBIA

AGRICULTURAL TECENOLOGY DEVELOPMENT PROJECT

Criteria for Subproject Sdectlon

MCU

SIg I Receve Proposals.

Stage 2 Enter Proposals in Database showing for each one:

ID NumberThieExecuting AgencyProject data (see profile)Annuallbtal Cost data (see profile)Funds requested from PRONATrA (se profile)Origin of requestDepartmentType of Fbcuting AgencySubsector

Stage 3 SCREEN for duplication and DISCARD duplicates

Stage 4 SCREEN for meeting project criteia

(a) Is duration tbree yes or less(b) Is average cost of total project US$50,000 or

les per annum(c) Do funds requested comply with approprate co-

fnancial nonns (40%, 50%, 100%)

(d) Do objectives confborm to policy criteria of:

&ie MODERNIZATION thoughstrengthening efficiency, equity, sustaiabilit ordevelopment of scientiflc capacity

gi DECENTRALIZATION thrughstrengthening Department Secrtaiats orUMATAS in a way that meets hrmers needs.

DISCARD all projects that have a 'no' answe to any of thebur quesfons.

htage S AWARD A QUALITY SCORE (0-100) to each rmaininigproject. (For 1994 use ICAs scoring system then have the

-48-

ANNEX 10

Pancl revise this and the Consejo discuss It for subsequentcvaluadons).

DISCARD projects which do not score an agreed minimumnumber of points.

Slsge 6 SORr the database into three:

ResearchAdjustnent and Ichnology TransferTlaining

Stage 7 REPARE a p sional summary for the database in order togain an idea of the degree of further screening needed eg., forthe first semester of 1994 the Summary at this stage mightlook like this:

Eligible Target for Target forProject Panel to see Panel to

recommend

Research 90 40 20

Adjustnent and 150 60 20-ansfer _

Tkaining 15 15 10

Ibtal 255 115 50

-49- !110

m - Tr-r- ln 1 1- 1 - - -

2- - - T- -

I; i _ _~ ___ ;~~ - -2 __ _ _- _ _ _ _____ _

ss- -} i - -- -- - -

^ _ 5 D-- _ - __ -

_ __ _- _ _

a Sis______________T

g~ - - m -_-- _ _-

-50-ANNEX 10

Stage 9 SCREEN at the Departmental level leaving a maxium of 2-4projects per deparment and say SO projoct nationally toreduce the portfolio to the panel tuget shown in Stage 7.

This is the most difficult and subjective part of the screeing todate and needs to be carried out very careully.

Stage 10 PRINT a set of Portfolio tables eg., as follows:

Table 1: By Department

Department No. of Projects PRONATTA REQUEST

AMAZONAS No. % N

I

VICHADA-

TA tal I I IIbble 2: By ENTITY CORPOICA

Other GovtUniversities

lIbble 3: By GoWt. Priorities List to be defined

Mible 4: By Subsector AgricultureFisherieseMC.

Stage 11 REVIEW and MODIFY the data by iting theDepartmtal MLbles in Stage 8 and the Pbrtfolio bble inStage 10 to arrive at an oximation of the targets hown inStage 7.

Stage 12 PRINT a revised set of portfolios and a summary of eachprqect justfying why it is being recommended and PRESENTthis to the Panel.

PANEL

Sbtge 1 JIF1Er Selecton to reduce it to taget numberslcat.

Stae 2 PRINT, REVIEW AND MODIFY the new portios

-51-

ANN3X 10

Stage 3 PRINT a revised set of portfolos and PRESET to theConsejo with a brief note justifying each recommendadon ofthe panel.

-52- ANNB 1

COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOPMNT PROJECT

Enulronmental Checklist and Key Screening and Monitoring Facto

1. The project will promote research activities that will incraseagricultral productvity that will ultimately have environmental impacts.Almost any agrcultural development project would involve disurbance of dteland surface. When the area is small, the impact would also lily be small;hower, the cumulative impacts of many small disturbuaces can besubstantial. The kinds of alterations to the land that are of concern are asfolows:

O clearing and/or paving (roads and highways, largsclehousing projects);

o topsoil removal and grading;

O flling (wetlands, coastal zone managemet, roads andhighways);

o draining (wetlands); and

o cultivation (agricultural management, forestry).

2. Research subprojects should be screened on the following

o environmental impacts of site prepardon fbr aparticular agricultural activity;

o gowth rats of the crop, agroforstry, or plantaio;

o weed problems and the presence of pests and dwawe

O management treatments - if being done properly andaccording to schedule;

O market trends and distnbution of revenues and benetsfrom the larger scale opeadns;

o pressure on agriculture, land tenure, natural lbrests andenvironmental impacts of harvesting; and

O long-term viability of the agricultural enterprise fromecological, economic and manageil standpointL

-53- ANN) 11

3. To fully evaluate the NAITP and the project, monitoring plansshould include baselne data and periodic review of objectives. Typialprofiles can be developed for research programs such as agroforestry,exmtsion, institutional development, erosion and sedimentation impactsassociated with small civil works and the effect on local and regional societyand govemment.

-54-

ANNEX 12

COLOMBIA

AGRICULTURAL TCNOLOGY DEVELOPMON PROJECr

Summary Tenus of Reference for Mijor Consultant Serviceslb be Sarted in Year One of the Project

1. Impl t a System for Monitoring and Evaluating the Project

Objectlve: lb refine and implement a system to: (a) monitor theimplementation of research subprojects financed under the project to ensuethat projects are being implemented in a timely and cost effective fashion asper the cofinancing contacts; and (b) ealuate the completed subprojects todetrmine if they were successul in meeting their objectives.

Scope: The consultants would assist the MCU to undertake the fllowig:.(a) prepare working guidelines for monitoring, evaluation and envinlimpact and finalize the proposed checklists; (b) establsh the methodology tosiect from the ongoing subprojects those that would be visited; (c) prepareample reorts for field monitoring visits and evaluation visits; (d) establisH

the methodology tD take follow-up action on subprojects whereproblems/actons have been identified; and (e) implement the above systemwith hands-on taining provided to the staff of the TDU.

J-mplemetatlon Consultants would be hired under TOR accepble t theBank to work with MCU on the implementation of the above system.hnplementation should put in pace a system of periodic visits of a samplingo ongoing subprojects and a review of completed subprojects with samplingfield reviews usig standard check lists.

Duration: Four moinths

2. Unoversity Astship Program

Objective: Develop a program to provide scholarships to about 80 studentsfor posaduate t g to the Msc level through participation in reshsubrojects financed under the projet.

Scope: Spell out the ful deils of the program including: promotion,student selection, project selection and implemnting entity parficipation,elgible costs covered by the program, disbursement of funds, and evaluationof student participation and other reporting requirments.

Impl n;o,tatin-: Cosulatnts would be hired to assist with the preparationof a detailed program, including the annual budget for this compoent.

Diurtion: Five months

-55-ANNEX 12

COLWMBI

AGRICULTURAL TENOLOGY DEVELOPMENT PROJECT

3. Agricultural Rsearch Ioatin Systm

Objectlve: Undertake a detailed study to design a cost effective, susinableminrmation system for agricultual tchmology that would define and mnt thebasic information rqu s of small farmers and die UMATAs, regionalresearch centea, researchers and entities participatin the project Oncethe system is accepted, equipment would be purchased, data basesconstructed, training pwvided and the system implemented.

Scope: The study should be in the form of a feasibility study and include inthe table of contents: objectives and benefits; description of the system andits operaton (including the software and hardware requiments); the capitlanc operating costs including the annual budget; financing; implementation;and sustaiability.

Implementation: Consultants would be hired to assist MCU with thepreparation of a detailed information system which would be approved by theMOA, and the Bank. The consultants would also assist with theimplementation of the system including training to paricipants.

Duration: Design - five months, Purchase Equipment - four months, andImplementation - three months.

cm1 .l

-56- ANNEX 13

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-58-

ANNE 13COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECr

Pag 3 of 3

PROJEC =UPUVJSION

Bo&k Staff Inputs for ject Supervisin

1 fAnicipad nput in StaffApprman Skil Fed lTim

Dam Aci"vity i mu (bk

Decomber 1994 Review cosAltan work, eview Ibk Maerptfoo pamumemn ant wxk ExiondaofRs. Spec 1plan for 199S

Jaary 1995 FinSmvised Loan Agreeme Spe. DeA revisfor appival by Borrower LavyrReview consultano prohUmr lk Magewk on the daed supevision_tsygm, OM and other doceL

Mr 199 1Sision afir effedves to l_sk Manar 1review IebOactw finaning, Rewazuk Speciai ieial account amnezmen

gafflag tasimg e__ _

iuly 199S Review implemenbdion of E _o P Spec. 3.zpervaszon ym, ag n Fin. AnalydnL Sp. 2scope of iomatio rystem,implementation plan for secondsemecr, poposed budgot for

___ __ 1996January 1996 Supevision Mission ExbnonftRe Spec. 2

July 1996 Supervision Mision, rview ExnsioRea. Specw. 21OR for Perwrmance Report, Fin. AnIhyd/inaL Sp. 2Prposd budgt for 1997 _

Jimmy 1997 Supervision Minon, meet with Exmension/ae. Spec. 2consaultnts re PwrformanceReport

Juneuly 1997 Supervision mison, mid-rm ExlensionlRs Spec 3mviow with Govrnment and Fin. Anday.l)L Sp. 3Prpoed Budupt for 1998 Rareb Conunan 3

-59 - ANNEX 14

COLOMBIA

AGRICULTURAL TECHNOLOGY DEVELOPMENT PROJECT

SELECTED DOCUNlEN'S AND DATAAVADLABLE IN THE PROJECT FLE

L . eApprisa and A_praisa Mis3ion Rerts

1. Technical Assistance Component - M. McMahon - April, 1993- English.

2. Institutional Aspects of the Technical Assistance Component toStrengthen The Departmnental Agricultural Secretariats -Ricardo Varps del Valle - May 1993 - English.

3. Technology Generation and Transfer Component - B Neslel -July 1993 - English.

4. Training in SINTAP - J. Arboleda - May 1993 - English.

5. Organization and Operation of PRONATA - P. Amaya - May1993 - English.

6. Unidad de Direcci6n y Coordinaci6n - M4NAG - P. Amaya -July 1993 - Spanish. *

7. Componente de Seguimiento y Evaluaci6n, Promoci6n yDivulgaci6n del PRONATIA - P. Amaya - July 1993 -Spanish.

8. Panel de Expertos - P. Amaya - July 1993 - Spanish.*

9. Componente de Capacitaoi6n en Gesti6n del PRONATIA -P. Amaya - July 1993 - Spanish.

10. Propuesta para la Creaci6n de los Centros de DesarrolloTecnolfgico Regional - CRECEDS - P. Amaya - July 1993 -Spanish.

11. Pryecto Apoyo a la Realizaci6n de Tsis de Grado a Nivel deMaestrfa - P. Amaya - July 1993 - 'Spanish.

12. Unidad de Desarrolo bcnol6gico - C-lDU - ICA - P. Amaya -

July 1993 - Spanish.*

13. Propuesta de Prestaci6n de Servicios al ICA - Fiduciario -P. Amaya - July 1993 - Spanish.

- 60 - ANNEX 14

14. Analysis of the First 1,100 Subprojects for Financing -R Nestel - July 1993 - English.

15. Unidad de Direcci6n y Coordinaci6n (SAR annex fobmat).

16. Panel of Experts (SAR annex format).

17. Technology Development Unit (SAR annex format).

18. Detailed Cost Ibbles.

19. Proposed 1994 and 1995 budgets for MOAIMCU andICAITDU.

11. Other Selected Documents Available in the Prolect File

1. (a) Resolution 812 of December 1994, Resolution 476 ofAugust 1994 and Resolution No. 429, dated June 25,1993, from the Vice Minister of Agriculue creatingthe Executive Council for PRONATrA and theManagement Coordinating Unit - Spanish. *

(b) Appointment of Mr. Luis Arango - ProjectCoordinator- MCU.

2. Promotion of Projects and Executing Agencies - MOA - May1993 - Spanish.

3. Pre-Appraisal Mission Aide Memoire - May 1993 - Spanish.

4. Interactions in the Public and Private Sector in AgricultualResearch - C A. Falconi - April 1993 - Spanish.

5. List of Shareholders of the Corporaci6n Colombiana deInvestigaci6n Agropecuaria - June 1993.

6. Corporaci6n Colombiana de Investigaci6n Agropecuaria -Statutes - November 1992 - Spanish.

7. El Municipio Unidad Bbsica para el Dcsamollo Agropecuario,L. Medina, N. Mejia - February 1991 - Spanish.

S. Restruchuing of InstitMo Colombiano Agropecuario - ICA -Decree 2141 - December 30, 1992 - Spanish.

9. Ogation and Function of the lbchnology DevelopmentUnit in ICA - June 1993 - Spanish.

-61- ANNEX 14

10. Restructuring of Fondo de Cofinanciaci6n para a InversifnRural - DRI - Decree 2132 - December 1992 - Spanish.

11. El Sistema Contable del PRONATTA - MOA - June 1993 -Spanish.

12. Programaci6n y Presupuesto del PRONAITA - MOA -June 1993 - Spanish.

13. Unidad de Direcci6n y Coordinaci6n (Organizaci6m y PlanOperativo 1994) - MOA - June 1993 - Spanish.

14. (a) Reglamento Operativo - Unidad de Direcci6n yCoordinaci6n MOA - June 1993 - Spanish.

(b) Reglamento Operativo - ICA - June 1993 - Spanish.

15. The General Statutes for Contracting by Public Administations(Fiduciario) - Government - 1993 - Spanish.

16. CONPES Document Authorizing the National Covenment toBorrow from the World Bank for the Project - CONPES,June 22, 1993 - Spanish.

17. Appraisal Mission Aide Memoire - July 1993 - Spanish.*

18. Bilateral Ag. Research and Development Fund (BARD) - US -Israel - Guidelines for Grant Applications - 1991 - Engiis.

19. Sistema Nacional de fTansferencia de Tecnologfa (SINTAP) -Outline of System - Spanish.

20. Decree No. 2379 Covering the Provision of TechnicalAssistance to Small Farmers - October 1991 - Spanish.

21. Creation of the TDU and selection of key staff - ResolutionNo. 4796, dated August 9, 1993 - No. 5388 - datedOctober 26, 1993, and No. 1468 - dated April 19, 1994.

22. Estimated Retro-Active Financing Costs for 1993. *

23. Review Panel Project Selection Process - B. Nestel.

24. Creation of the National Panel and Regional Panels -Resolution No. 00632 - dated August 11, 1993 - and theselecfion of the 7 panel members.

25. Ayuda Memoria - Prepared by MINAG after the AppraisalMission - August 1993.

- 62 - ANNEX 14

Note: Items marked with an * are contained in the three volume documentprepared by MINAG and labelled 'Ayuda Memoria.

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