Document of The World Bank FOR OFFICIAI USE ONLY Report No. 10806 PROJECT (OMPLETION REPORT BENIN FORESTRY PROJECT (CREDIT 1505-BEN/SF 024-BEN) JUNE 30, 1992 Ac:iculture Operations Division Occidental and Central Africa Department Africa Regional Office This document has a restricted distribution and mas be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS Currency: CFAF 1/ AVERAGE EXCHANGE RATE i984 US$1.00 = CFAF 480 1985 US$1.u0 = CFAF 378 1986 US$1.00 = 323 1987 US$1.00 = 267 1988 US$1.00 = 303 1989 US$1.00 = 289 1990 US$1.00 - 280 GOVERNMENT FISCAL YEAR January 1 - December 31 PROJECT YEAR October 1 - September 30 WEIGHTS AND MEASURES Metric System ABBREVIATIONS AND ACRONYMS AfDB African Development Bank AID Agency for International Development CAA Caisse autonome d'amortissement CARDER Centre d'action regional pour le developpement rural (Regional Rural Development Agency) DEFC Direction des eaux, forets et chasses (Department of Water, Forestry and Hunting) DRA Direction de recherche agronomique (Department of Agricultural Research) FAO-CP Food and Agricultural Organization of the United Nations/ Cooperation Programme FRG Federal Republic of Germany GDP Gross Domestic Product GTZ Geselischaft fur Technische Zusammerarbeit IDA International Development Association KFW Kreditanstalt fur Wiederaufbau MDR Ministere du developpement rural (Ministry of Rural Development) MESRS Minist6re de l'enseignement superieur et de la recherche scientifique (Ministry of Higher Education and Scientific Research) NRMP Natural Resource Management Project ONAB Office national du bcis (State Wood Company) PCR Project Completion Report SNAFOR Soci6t6 nationale pour le developpement forestier (National Forestry Development Company) URF Unit6 de recherche forestiere 1/ The parity of the CFAF with the French Franc is fixed at 50/1. FOR OFFICAL USE ONLY THE WORLD BANKC Washington, D.C. 20433 U.S.A. ffice of Director-General Operations Evaluation June 30, 1992 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on BENIN Forestry Proiect (Cr. 1505-BEN/SF 024-BEN) Attached, for information, is a copy of a report entitled "Project Completion Report on BENIN - Forestry Project (Cr. 1505-BEN;SF 024-BEN)" prepared by the Africa Regional Office. 2 Attachment This document has a restricted distribution and may be used by recipients only In the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. FOR OFFICIALUSE ONLY PROJECT COMPLETION REPORT BENIN FORESTRY PROJECT (C1EDIT 1505-BEN/S- 024-BENI msTBLE OF CONTENTS PaneNo. PREFACE ...................... i EVALUATION SUMMARY ........ ...... ................ iii PARTI: PROJECT REVIEW FROM BANK'S PERSPECTIVE 1....... A. Project Identity ................................. 1 B. Background . .................................. 1 C. Project Objectives and Description ..................... 2 D. Project Design and Organization ....................... 3 E. Project Implementation ............................. 4 F. Project Results .................................. 6 G. Project Sustainability .................... 7 H. Bank's Performance .............................. 8 I. Borrower's Performance ............................ 9 J. Project Relationship .............................. 10 K. Consulting Services .............................. 10 L. Project Documentation and Data .......... ............. 10 PART 1: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE 11 PART mI: STATISTICAL INFORMATION ...... .............. 25 1. Related Bank Credits ............................. 25 2. Project Timetable ............................. 26 3. Credit Disbursement .......................... 27 A. Cumulative Estimated and Actual Disbursemeit .... ....... 27 B. SDR-US$ Exchange Rate .......................* 25 4. Project Implementation . ............................. 29 5. Project Costs and Financing .......................... 30 A. Project Costs ................................ 30 B. Project Financing ..............................- 31 _AP - IBI, Mo. 1.7325 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. PROJECT COMPLE 1'ON REPORT BENIN FORESTRY PROJECT (CREDIT 1505-BEN/SF 024-BEN) PREFACE This is the Project Completion Report (PCR) for the Forestry Project, for which Credit 1505-BEN and Special Fund 024-BEN in the amount of SDR 2.5 and 2.6 millions respectively were approved on June 21, 1984. Both the Credit and the Special Fund closed in December 1990, six months behind schedule. The Credit and Special Fund were fully disbursed in June 1991. Parts I and III were prepared by a consultant and revised by staff of the Agriculture Operations Division of the Occidental and Central Africa Department. The Studies Unit of the implementing agency prapared Part II before Parts I and III were prepared. Preparation of the PCR was done about 12 months after the Credit was closed. It is based, inter alia, on the Staff Appraisal Report, the Special Fund Credit Agreement, the Development Credit Agreement, the GTZ Loan Agree- ment, supervision reports, correspondence between the Bank, the Borrower and the implementing agency, internal Bank memoranda, reports prepared by the implementing agency and disc'issions with representatives of the Borrower and the Bank. A more exhaustive list of the documents consulted is given in Annex 1. - iii - PgOJECI COMPLETION REPORT BENIN FORESTRY PROJECT (Credit 1505 - BEN) (SF 024 - BEN) Evaluation Summary Project Obiectives (Part I, para. 1.07) 1. The principal objectives of the Project were (i) to reorganize and increase hth technical capacity and the effectiveness of the Government's Water, Forestry and Hunting Department (DEFC); and (ii) to execute an industrial plantation program. The main components were: the establishment of a permanent unit within DEFC responsible for strategic planning and programming, and administration and control of sector finances; the establishment and maintenance of a 3,800 ha teak sawlog plantation in the Lama Forest Reserve; the establishment and maintenance of 410 ha of pilot plantations within Toui and Lama Reserves; and the execution of studies. Project Desion (Part I, para. 1.09) 2. The project was well designed, based on good preparation work and close coordination between the Bank, the Government, and bilateral and multilateral aid agencies, already involved in the sector. Consistent with the identified weaknesses of local institutions, the number of components was kept to a minimum, geographical coverage focused, the need for interagency coordination virtually eliminated and physical implementation targets kept at a realistic level. 3. The project concept, however, displayed a number of shortcomings concerning the design and provision of technical assistance, the annual work plans, the problem of illegal settlers, monitoring and evaluation and the coordination of the management of the different project components. Imolemeittation Exoerience (Part I, para. 1.13) 4. The Credit became effective eight months later than the originally planned date while the original closing date was extended by six months. Technical assistance was put in place in a timely fashion. 5. Quality and effectiveness of implementation were good for the main (plantation) component, and inadequate for most other components for reasons reviewed below. 6. Procurement was done according to guidelines except for a minor problem in the first year of implementation. Project costs were only 3% over CFA estimates and virtually all funds were disbursed. The project as a whole faced no unusual risk, technical or otherwise and this was reflected in the implementation experience. - iv - Results (°art I para. 1.21) 7 Project objectives were substantially acbieved for the plantation establishment component with 3,203 out of 3,800 ha planted, an achievement rate of 84%. The shortfall was caused by unpredictable technical and climatic factors. Control of the ' dma Forest Reserve was successfully reinforced and further 3ncroachment stopped. 8. Institutional strengthening of DEF C fell substantially short of the goals sought because of the inadequate design of the institutional building component and the weakness of the technical assistance provided. The research and training components failed to achieve their objectives because of faulty design and, to an extent, an inadequate supervision effort. Finally, the studies component was completely neglected. 9. The main and probably only project impact is the preservation of the Lama Forest Reserve and the establis-.mer.t of a first class teak plantation. The economic rate of return is estimated to be close to the appraisal estimate, i.e. 14.3% vs 14.5% at appraisal. This anialysis is based on the assumption that external support will continue (para 10). Susta_Iabilitv (Part I para. 1.33) 10. Given the commitment of the German Government to continue to support the plantation progrartl, project sustainability is not an immediate issue. In the future, the threat posed by the shortage of funds to maintain Government services should be mitigated by the on-going structural adjustment program, as well as by the IDA-financed Agricultural Services Restructuring Project, which aims at restructuring such services to eliminate wasteful duplication, improve their efficiency and achieve significant cost savings. 11. The performance of the Bank has been good throughout the project cycle. However, it manifested a few shortcomings at the design (preparation and appraisal) and supervision stages. The institution building and manpower training components could have been better structured while supervision mission could have reacted faster and more forcefully to identified or emerging problems. Finally, a better assessment should have been made of the Government's capacity to meet its financial obligations under the project. Borrower Performance (Part ! para. 1.40) 1 2. The Government played mainly a rather passive role and failed to meet its financial obligations. Comments on Borrower's views (Part II) 13. The project review from the Borrower's perspective (Part II of the PCR) was written before Parts I and IlIl were drafted. In appraising the project's performance, the Borrower underlines, among other things, the faulty design of the institution building and the research components, the neglect of the studies component and the need for a second-phase project. 14. These views are for the most part relevant and correspond to many of the points made in the Project Completion Report. v Findings and lessons learned 1 5. The major findings and lessons are the following: (a) When dealing with a situation where institutions are weak, project design should be kept simple and the demand made on Government agencies limited to the extend possibie. The success of the plantation component is a good illustration of this point; (b) Sub-contracting for the management of project components should be considered when there is a local institution with relevant sxperience in the project sector. ONAB was such an. institution and it is acknowledged that it contributed to the success of the plantation establishment component; (c) Non-payment of sa!s, G ;p;'ements to project staff is fully accepted in the design of projects in the I3ank now, including applying this principle to "cofinanced" funds. The low motivation/performance of local DEFC staff was influenced by their working in close proximity to local staff of ONAB. which were paid outside the restrictions of the "Administration"; (d) when designing institutional building components, clear objectives should be established at the start with a well defined timetable to achieve them in term of transferring certain skills, training programs, performance yardsticks for consultants and handover of responsibilities. The fact that this was not the case in this project may have greatly affected the outcome; (e) When projects are designed, every effort should be made to ensure that the financial contribution expected from the Government is realistic and contingency plans should be studied and put in place so that the project does not suffer frum the Government's inability to pay. In this respect the forestry project was saved only by the willingness of the German Government to provide funds on behalf of the Borrower; (f) In the forestry sector, the long gestation period it takes for any project to become productive and the necessity to ensure adequate plantation management during that period if the initial investments are not to be jeopardized, probably militate for the need to consider projects not individually or as stand alone, but within the framework of successive phases; and (g) The project led to a broader reflection on the rational management of natural resources. The policy dialogue between the Government and donors regarding a rational approach to environmental problems and the conservation of natural resources has evolved since the Forestry Project. The recently approved IDA-financed Natural Resource Management Project (NRMP) has a comprehensive approach involving the rural population and other private operators. The NRMP follows the strategy of reducing State involvement in the production and marketing process in favor of a more decentralized and participatory approach, which involves the local population iii the management of natural resources. PROJECT COMPLETION REPORT BENIN FORESTRY PROJECT (Credit 1505 - BEN and SF 024 - BEN) PART I: PROJECT REVIEW FROM BANKWS PERSPECTIVE A. PROJECT IDENTITY Project Name Forestry Project Credit Number : 1 505-BEN and SF-024-GEN RVP Unit : Africa Regional Office Country Republic of Benin Section Agriculture Subsector : Forestry B. BACKGROUND 1.01 Benin has a land area of about 1 13,000 Km2. Its population was estimated at 4.6 million in 1989, and increasing at an average annual rate of about 3.2%. With an estimated annual income per capita of US$380 in 1989, Benin remains one of the poorest nations in the world. At project appraisal, Benin was self-sufficient in food and generating considerable foreign exchange earnings from the export of cotton, oil palm products and groundnuts. Agriculture was the most important sector of the economy, employing 74% of the active population and providing 45% of GDP and 55% of the country's foreign exchange. 1.02 The Government's first three-year development plan (1978-80) aimed to raise agricultural productivity, to improve the standard of livinqg, strengthen economic policies and implement economic and social change. The second economic and development plan again gave priority to the improvement of agricultural productivity and the expansion of cultivated land for both food and export crops. The attainment of these objectives was jeopardized in part by an explosive population growth leading to an over-exploitation of the arable land and a gradual disorderly deforestation. This represented a threat to the ecological balance. 1.03 Gazetted forests as well as parks in the savannah region were being threatened by a gradual encroachment by farmers, poachers and bush fires with disastrous consequences for the fertility of the soils and their capacity to regenerate tree cover. At the same time, the growing need for fuelwood was accelerating deforestation, especially around towns, and causing incipient desertification. 1.04 The Government objectives in the forestry sub-sector were: (i) to protect the remaining natural forests from over-exploitation, encroachment and bush fires; (ii) to develop a sustained supply of fuelwood, building poies, wood and other wood products for Doth rural and urban populations; and (iii) overall, to manage the forest resources on the basis of sound environmental practices. 1.05 The policy and strategy pu;rsued by the Government to achieve the above objectives have been to: (i) strengthen the institutions responsible for the planning and implementation of the forest y activities: (ii) establish fast growing tree plantations that can be managed or a rational basis: (iii) encourage the participation of rural populations in reforestation; and (iv) promote research and projectz in ways of improving forestry technical packages and efficient wood uses. Throughout, the Government has actively sought and obtained the assistance of both mult;lateral and bilateral dcnars and, to an extend, has fostered greater regiona: cooperation. 1.06 The project as appraised and negotiated was ciearly consistent with the Government's policy and priorities described above and its design was in tune with most views of the donor community on the types of activities to be supported. C. PROJECT OBJECTIVES AND DESCRIPTION 1.07 Proiegt Obiectives. The project had two principal objectives: (a) to reorganize and increase the technical capacity of the Government's Water, Forestry and Hunting Department (DEFC), to increase its effectiveness in (i) collection and use of based information for the formulation of an appropriate forestry strategy, (ii) planning, coordinating and executing programs to implement the strategy, and (iii) design and administration of fiscal measures influencing the forestry sector; and (b) to execute an industrial plantation program to reduce future dependence on imported timber, and generate revenues for further forestry development. 1 .08 Proiect Description. To achieve these objectives, the project had the follo'wing components: (a) the establishment of a permanent unit within the Project's executing agency (DEFC), responsible for strategic planning and programming, and administration and control of sectoral finances, with material, logistical and technical support; (b) the establishment anc maintenance of a 3,800 ha plantation of species (principally teak) suitable for sewlog production in the Lama Forest Reserve; (c) the establishment and maii;.enance of 410 ha of pilot plantations within Toui and Lama Reserves to test improved species and sources of seed, establishmeni and maintenance techniques and charcoaling methods; (d) the execution of studies in support of the formulation of a forestry strategy, improved plantation establishment, preparation of possible future forestry development projects, and a mid-term review of the project's execution; and (e) tra;ning of selected local personnel through arrangements made by the Federal Republic of Germany. -3- D. PROJECT DESIGN AND ORGANIZATION 1.09 The project design was doveloped and evolved through close coo4dination betwcen the Bank, the Government and other multilateral and bilateral agancies afready active in the fcrestry sub-sector in Benin. The resulting conceptual foundation for the project was basically proven, appropriate and clear and reflected the uons-aints and opportunities identifi3ble in the country. Thu number of components was limited and the required interagency coordination for their effective implementation was kept to a minimum. Their implementation sub-contracted to agencies other than DEFC, which was consistent with the weakness of local institutions. The geographical coverage of the project was focused, the proyrammed physical implementation targets oG the project were kept tc a realistic leval; and the experience of the German Forestry Assistance Program and a solid~ Woca institution (ONAB) were properly used to implement the major project component. 1.10 It should be underlined however that there were a number of shortcomings to the project as designed. EiW, despite the realization that Government forestry services were weak and needed strengthening, IDA-financed project assistance to DEFC was defined .arrowly and limited to the provision of two expatriate technical assistants. No tra.ning program, an essential part of any institution building effort, was conceived nor funds ptovided for it. All training activities were specifically limited to the German-sponsored and managed plantation establishment antivities. As could be expected, training was provided by the German Forestry Assistance Program to some ONAB staff directly involved in the plantation program. It is not clear that DEFC is more capable of its m.ssion now than before the project. econd, the new advisory/policy unit created within DEFC in fact duplicated the Tunctions of an already existing "Service Etudes et Documentation" (Studies and Documentation Unit) and no effort seems to have been made to either merge or coordinate the two units which tried to do the same things separately. Third, the concept of annual work plans included in the project and legal documents was not properly explained to all relevant parties as an important planning a!d management tool. As a result, it was seldom used and this may have led to an unbalanced implementation of project components. Fourth, although the problem of illegal settlers and farmers in the Lame forest reserve was recognized early on in the project cycle, it was not sufficiently investigated and the resulting project design included no specific or coherent program to deal with this sensitive issue. It was and is still being addressed through the foresight and thoroughness of the German bilateral as. stance program. It must be mentioned, however, that Bank staff authorized the use of !', funds to help meet the costs of resettlement operations of these farmers during early project implementation. Fifth, the relevanco of monitoring and evaluation was nct properly integrated into the project concept. And sixth, although the roles and r6 e -isibilities of the institutions and agencies (ONAB, DRA and DEFC) responsible for the project were clearly defined, the structure put in place did not realistically take into account the relative bargaining powers of these institutions and agencies. As a result, project implementation was too heavily dependent on ONAB because of the entrenched power base of the German bilateral technical assistance, wh,le DEFC and DRA played only minor roles, well below the objectives envisaged at appraisal. 1.11 The project was well prepared by an FAO/CP mission assisted b7 the German Forestry Mission in Benin. Its tirning and scope were appropriate. Its implementation was planned to be synchronized and consistent with the beginning of the third phase of the German forestry assistance program to Benin. -4- 1.1 2 As stated above (para. 1 . 1 0), the roles and responsib,lities assigned to diffurent institutions and agencies did not rroperly reflect their relative strengths. The success of the project can be attributed mainly to its plantation p:ogram because of the strong assistance to ONAB from the German Forestry Mission in Benin. However, this strong input also contributed to weakening the implernentatiQn of other project components such as the reinforcement of DEFC and resaarch aciivities. E. Proiect Imrlementation 1.13 Credit Effeiveness and Prgct Start-up. The project was appraised in March 1983. Thn Credit was approved in June 1984 and became effective in July 1985, about eight months after the planned date. The original closing date of June was postponed to December 1990. Despite the aelay in project effectiveness. the plantation establishment program substantially mret its target due in part to the postponement of the Credit closing date. However the institution building, manpower development and research ac.;vities were not well carried out. 1.14 The following factors were principally responsible for the difference in the implementation result, between cormponents: (i) the design of each individual component; (ii) the quality of technical assistance provided for the execution of each component; (iii) the avail,ability of funds for the implementation of each component; and (iv) the nature of the supervision effort provided. The shorccomings in project dssign were reviewed earlier (para 1.10). The quality of technical assistance was superior for the establishment of the teak plantation with ONAB, but poor for the policy formulation planning and coordination activities of DEFC and not even provided for the research activities. The implementation of some compon6nts (training, studies and research, institution building) was negatively affected by either thB institutional weakness of the units responsible for their implementation, insufficient allocation of funds or overspending by other components. Finally, the supervision concentrated its efforts mainly o0. the plantation component and was somawhat less insistent on the oti er components. 1.1 5 A more effective use of annual work plans and budgets as a management and resource allocaton tool could have introduced more balance between project components. A more forceful intervention by the Bank supervision missions early on after the realizatior' that the key technical assistant with DEFC was not performing well would have led to his replacement and probahly salvaged that important component. 1.1 6 Implementation Schedule. Despite the early implementation delay, the plantation program was basically on schedule. However the start of rcsearch activities was delayed for about two years because the research unit could neither propose an acceptable annual research prograrm nor submit a budget. The technical assistai..._. were hired on schedule to reinforce DEFC, but only the financial controller made a worthwhile contribution. Studies were not carried out because apparently viable proposals were not presented. 1.1 7 Procureinent. Except for an early problem of incorrect procedure for the selection of a contractor for civil works (1 935;, all procurement matters appear to have been handled correctly. - 5.- 1.18 Prgiect Cot. Pro,ect estimated costs were CFAF 4,521 million net of taxes and 5,081 including taxes (US$ 11.6 and 13.0 millions equivalent respectively). Total costs from audi.ed financial statements have been put at CFAF 4,640 million before taxes, representing an increase of less than 3% over original CFA estimates. The minor overrun resulted from an increase in local costs because of a small increase in project scope. 1.19 Disburse ants and Credit Allocation. Disbursements are provided in Part lI, Section 3. The last disbursement was made on November 13, 1991 for Cr. 1 505-BEN and on July 25, 1991 for St 024, with cancc""ntions of SDR 5,521.18 and SDR 861.74 respectively. As detailed in Part ll, Section 5-B, analysis of disbLursements compared to the original allocations by category reveals the following. Disbursement Allocation Percentage of Percentage Percentage Expenditures Cateaorv Underdisbursed Overdisbursed Financed 1. Vehicles and 79 100 Equipment l 2. DEFC operating 510 78 costs 3. Forestry 41 78 Plantation 4. Research 37 78 5. Consultants 13 100 (DEFC only) __ _ The establishment of the teak plantation represented the highest amount in both absolute terms (SDR 2.6 million) and relative terms (52%) of total IDA financing. It also had the highest absolute overrun (SDR 1.1 million) and the second highest relative overshoot (41 %). One figure that stdnds out is the high overrun of DEFC operating costs (510%). 1.20 Risks. At appraisal no major technical risks were identified. Fire was considered a normal risk that could be well contained by appropriate management. Another risk element was the uprooting of trees by winds. The use of seeds in poly bags first reduced and then eliminated this latter risk at the early stage of plantation development. Proper future thinnings was to be another effective measure against such a risk. -6- F. Project Results 1.21 Proiect objectives were substantially achieved for the plantation establishment component. As explained below, however, results for the other components were mixed and unsatisfactory in a number of cases. 1.22 Establishment of olantations. A total of 3,203 ha were newly planted with teak agairist the 3,300 planned at appraisal, or 84%. The shortfall was caused by the delay in the start of project implementation and by technical and climatic difficulties. Unusually heavy rains limited or slowed dowrn soil preparation activities and forced the project to revise target areas to be planted from 1 ,000 to about 800 ha per year over the last three project years. Further, soil conditions caused a high loss rate of newly planted trees during the first season when stumps were used. This led to the use of imported seeds from Tanzania which proved far more effective (17% loss factor against 35% for stumps). 1.23 Plantation infrastructure. The project built 1 5 km of access roads, 35 km of plantation tracks and 18 km of fire protection tracks, against 15, 38 and 20 planned at appraisal. In addition, about 1 38 km of tracks were maintained. Two hundred family houses and two schools were built to help resettle farmers whereas nothing had been planned at appraisal. About 40 small bridges, two houses, one guest house, one borehole and water reservoir were also built. 1.24 Forest Reserve Control. Interpretations of pic.ures by SPOT satellite between 1 983 and 1 987 indicate that about 750 ha of the Lama Forest Reserve were lost each year to farmers. After the project reinforced its control activities, satellita pictures indicate that no new forest encroachrnent has taken place since 1 988, attesting to the successful efforts under the project. 1.25 Reinforcement of the DEFC. DEFC was .o be strengthened with the provision of (i) a forestry expert to head a newly formed Advisory/Policy Unit and (ii) a financial controller. The forestry expert recruited proved to be not well suited for the job. First because he was not fluent in French, a stated prerequisite for the job, and second because he did not fit well within DEFC. As a result, key functions that were to be established within DEFC did not materialize: no monitoring and evaluation system was devised, no annual work plans and budgets were prepared except for the first year, as this was a condition of first disbursement, no first steps were taken toward the elaboration of a forestry strategy and no training program was conceived or carried out. The financial controller fared better but also displayed shortcomings which made his mission less than satisfactory in some important respects: no cost accounting system was installed; accounting management was not computerized; annual work plans and budgets were not prepared; and no proposals were prepared for the establishment of a forestry fund. 1.26 Research. The research program started about two years late and was neither consistent nor well formulated. In addition, the late start and failuire to properly manage the resource allocation system through annual work plans resulted in research funds being diverted to other components. Out of a total research allocation of about CFAF 273 million, only CFAF 123 million or 45% were used for research purposes over the life of the project. -7- 1.27 A total of 410 ha of pilot plantations were planned to be established for research purposes. Only 100 ha were actually established. It is not clear that relevant research themes were defined or worked on. 1.28 Training. About 10 man-years of overseas training of selected ONAB staff were to be financed during the project implementation period. Less than one man year of training was actually carried out, for Or4AB staff. No provisions were made for training of DEFC staff. 1.29 Studies. The programmed studies in support of the formulation of a forestry strategy, improved plantation establishment, preparation of further forestry development projects, and the mid-term review of the project's execution, were not carried out. The funds, originally assigned for studies, were diverted to other components. 1.30 Project Imoact. The project has had a major impact cn the preservation of the Lama Forestry Reserve. It has established a first class teak plantation. It has had also an impact on institutional development of ONAB staff, through the training of personnel in the techniques of forestry establishment and management. Over the long term and assuming the plantations created are properly managed, the project should have a positive impact on the supply of poles, sawnwood and, to a more limited extent, fuelwood. 1.31 On a different level, through its farmers' resettlement program, the project is experimenting with small scale farming technical packages that might prove replicable in other parts of the country. 1.32 The project economic rate of return is now estimated at 14.3%, compared with 14.5% at appraisal. G. Proiect Sustainability 1.33 Given the commitment of the German Government to continue with the financing of the plantation establishment and maintenance program for the foreseeable future, project sustainability is not an immediate issue for that component. It is probable that in the absence of a follow on project, the financial problems that the Government is experiencing would have seriously compromised the sustainability of normal plantation management activities if the German assistance was not available. Without further external support most probable, the economic rate of return would be reduced substantially. Until the plantation reaches a certain age and thinnings can. become a stable source of cash flow, the ever present problem of inadequate funds availability could hamper normal plantation management if and when the Germans leave. It is expected, however, that in the future, the threat posed by the shortage of funds to maintain Government Services should be mitigated by the on-going structural adjustment program, as well as by the IDA-financed Agricultural Services Restructuring Project, which aims at restructuring such services to eliminate wasteful duplication, improve their efficiency and achieve significant cost savings. 1.34 Plantation maintenance costs are currently estimated at CFAF 1 3,000/ha per year, for a total of CFAF 42 millions per year for the 3200 ha planted so far at Lama. Road - 8 - maintenance cost is estimated at CFAF 250,000 per km or a total of CFAF 1 7 millions per annum. H. Bank's Performance 1.35 Proiect Preparation. Project identification and preparation were properly handled with the required amount of coordination between the Bank and other donors involved in the forestry sub-sector so as to l,mit the interagency coordination demands made on the thin Government institutional capability. This approach did tend to maximize the effectiveness of limited Government manpower. However, sufficient attention may not have been paid to the financial resources of the Government and its capacity to meet its required contribution to the project under different scenarios. This represented a serious potential setback for the project which was avoided only because KFW agreed to finance the Government's contribution. 1.36 Proiect a2praisal. The appraisal was well conducted. Physical implementation targets were realistic. However, the project organizational structure did not give due consideration to the leverage that the German Forestry Mlission had on DEFC, the Project Coordination Unit. DEFC was unable to get the required cooperation from ONAB in the submission of annual work plans and budgets precisely because they were powerless. Likewise, the institution building program for DEFC was too narrowly focused on the simple provision of two technical assistants without a defined manpower training program (both in- service and external), and without a proper monitoring system. Finally, a realistic assessment was not made of the capacity of the forestry research unit to carry out meaningful research without a proper link to a well-established research institution for back-stopping and overall guidance. 1.37 Project Supervision. Over a six-year period, from September 1984 to December 1990, the Credit closing date, t, ere were only nine supervision missions. Three missions were led by an economist and six by an agriculturalist. A financial analyst participated in the last three of these missions and a forester (consultant) in only one mission, the sixth one. On three occasions a supervision mission did not take place for at least a year. The co-financing agency had six missions, with or without Bank staff. 1.38 Overa;', the Supervision missions from the Abidjan Resident Mission followed the project closely and raised the right issues, from inadequate technical support to DEFC to financial problems. One issue that was flagged from the third supervision mission on, was that of the development impact of the project. However, there was no clear definition of the problem and no forceful action was taken or recommended. First, the inadequate performance of the key policy advisor in DEFC was left to last until the end of the technical assistance contract, at which time, it was finally frankly admitted as inadequate. Second, the whole question of the lack of preparation of annual work plans and budgets was not raised except at the beginning of project implementation. Likewise the mid-term review was not carried out. Third, the weakness of the research effort was apparent from the start but no measures were taken either to seek professional advice on research or to encourage the research unit to be more diligent. Fourth, the lack of coordination between the German Forestry Mission at ONAB and DEFC was clearly perceived et the beginning but not dealt with. Eiftb, the lack of emphasis on institutional development and on the development of a program of studies to be - 9 - carried out under the project, was not addressed. And liAb, the absence of a monitoring and evaluation system was not properly acknowledged or remedied. !n tniis respect, not much seems to be known about the growth characteristics of the teak plantation so far. Urgent work is needed in this area if reliable production tables are to be prepared in the future. 1.39 The supervision missions did a good job on following activities on the establishment of the teak plantation at the Lama Reserve, including the hiring of a consultant when necessary to review the question of stump versus seed planting. However, it can be argued that this was precisely the component that probably required the least attention because of the strong bilateral technical assistance provided to ONAB. I. Borrower's Performance 1.40 The Borrower's performance was to a great extent conditioned by the project management structure that was put in place. Most project activities were not within the immedia.e control of the Borrower as represented by DEFC, the central Project Coordination Unit as they were sub-contracted to various executing agencies. Even the reinforcement of DEFC was largely made the responsibility of the two-man technical assistance team. As a result, the role of DEFC was mostly a passive one as it tended to avoid interfering with the performance of those responsible for specific components. 1.41 Ironically, the reluctance, or the inability of DEFC to intervene directly in the teak plantation establishment component at Lama may have contributed to its satisfactory implementation. However, the same passivity displayed with respect to other components prevented the project from having a balanced implementation. More specifically, DEFC failed to make ONAB and the forestry research unit live up to some of the terms of the contracts they signed: no annual work plans were submitted, and no regular reporting done. Likewise, the key technical assistant in the Policy and Advisory Unit was not made to perform up to standards. To that extent, both DEFC and the Government at large failed to perform their supervisory functions. 1.42 During project preparation, the Government collaborated fully with all the donors. After Credit signing, sufficient diligence was exerted by the Government to avoid a long delay before effectiveness. However, the Government was unable to provide counterpart funds on a regular basis, and KFW had to assume this responsibility on its behalf. 1.43 The main lessons for the Borrower are in three broad areas: groiect finance; institution building and accountabilitv. When projects are designed, every effort should be made to ensure that counterpart funds to be provided by the Government are realistic and can be provided. Contingency plans should be studied so that the project does not suffer from the Government's inability to pay. As far as institution building is concerned, clear objectives should be established at the start with a well-defined timetable to achieve them in terms of transferring certain skills, training programs, performance yardsticks for consultants and handover of responsibilities from technical assistance to local staff. Finally, since a heavy emphasis was placed on the role uf technical assistants in DEFC, its national staff may have felt not liable to be held accountable for unsatisfactory results. A way should be found to ensure the performance of both local staff and technical assistants. -10- J. Project Relationship 1.44 The relationship between the Bank and the Borrower was good. The relationship between the Bank and the cofinancier was equally good. However, the relationship between the project coordination unit, DEFC and the field unit of the cofinancier providing assistance to ONAB for the Lama plantation component was sometime strained and the flow of information was not adequate. K. Consulting Services 1.45 Few short-term consultants were used by the project. The forestry consultant used by the Bank in one supervision mission did an excellent job. The German Forestry Mission used consultants for six different missions. Five of them made an excellent contribution to the project. All these consultants were used for the plantation at Lama. L. Proiect Documentation and Data 1.46 All project documents (legal agreements, staff appraisal report) were comprehensive and provided a useful framework for the Bank and the Borrower during project implementation. They also provided sufficient flexibility to project management to allow them to adapt to certain field conditions as they evolved. - 11 - PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIfE I. INTRODUCTION Benin's development policy emphasizes the satisfaction of the basic needs of the population as well as the long-lasting management of natural resources. The end goal is to achieve a long-lasting and sustainable development. Within the framework of the forestry sector development in Benin, many programs have been developed and implemented, including the one called "Forestry Development Project". This project has been jointly funided by the World Bank (IDA), the Federal Republic of Germany, and the Republic of Benin. The project started in May 1985 with the setting up of the technical assistance and was due to end by June 1990. But it hau to be extended up to December 1990 due to certain difficulties which arose during the implementation resulting in the freezing of a large part of the project funds in local banks. This report is three-fold: - the sunmary and recommendations; - the main report; and - the attachments. II - THE COUNTRY 2.1. GENERALITIES Benin Republic is located in the Gulf of Guinea in We3t Africa. With a total land area of 112,600 square kilometers, it extends on about 640 km to the north. It's width from East to West is 350 km in the North and 110 km in the South. Benin's population is estimated at around 4.4 million inhabitants with an increase rate of 3.5 %. The population is unevenly spread: density is between 188 inhabitants/km2 in the South and 14 inhabitants/km2 in the North. The country can be divided into three main climatic zones: - the South, characterized by a sub-equatorial climate with a bi- nominal rainfall: 850-1,400 of rain per year and decreasing from East to West. - the Center, characterized by a sudano-guinean climate: 1,100-1,400 mm of rain per year and a distinct dry season of four to flve months. - the North, characterized by sudano-sahelian climate: 800-1,100 mm of rain and a six months dry season pet year. The rainfall is quite unimodal reaching its peak in August. Soils are relatively more fertile and deeper in the South due to their hydromorphic nature. The zone extending to the North is made of ferruginous tropical soils with swamps at some places. Tree coverage consists of few remains of semi-deciduous forest in the south, of dry forests and forest galleries in the center. In addition to these, there are large mixed forests changing from the open wood type to bus. %vannah as one moves to the extreme north. Open forests cover about 65% of the turritory including about 9% of open wood and bush savannah. This seems rather a paradox given the geographic location of the country but is explained mainly by the prevailinR climatic conditions. - 12 - In addition to these natural forests, there are old plantations dating from 1950 to 1960 (about 7,500 ha of teak) and 1966 to 1970 (5,400 ha of anacardia, 1,900 ha of filaos and acacia). Some palm trees and coconut trees have also been planted. Besides, with two large national reserves (7,700 ha) including the Pendjari rich in wildlife and three hunting zones (5,800 ha), Benin is among the west african countries with the most important wildlife resources. Agriculture utilizes about 75% of the active population and contributes to 40% of the GDP whilst the industry sector counts for 12% of the GDP. As for the trade sector, it is dominated by a dynamic informal trade. 2.2. FORESTRY POLICY AND STRATEGY The objectives of the current forestry policy are to assure that the populations are provided with forest products through a better management of forest resources with a view to protecting the environment. To implement such policy, the government initiated reforestation projects both at the central level in gazetted forests and at the rural level in form of village plantations. Some of these projects, intended to reduce the abusive exploitation of natural resources, are: - promoting rural forestry the "Forestry Resources Development" project; - renewal of the Lama teak plantation (about 6,000 ha) which dates back from 1950 to 1968; - creation of 3,500 ha state plantations and 2,500 rural plantations through the "South Benin Fuelwood plantation " project; and - the creation of village plantations in the Borgou and Atacora provinces and the "Multi-Purpose Trees Plantation" project. These projects have been followed by others not initially aimed at tree plant_.ng. It is the case, for example, of the "National Parks Development" and "Watershed Development and Bushfire Prevention" projects. This policy, however has some limitations as will be shown in this report. - 13 _ III - THE PROJECT 3.1. BACKGROUND AND LOCATION Although the government has initiated many reforestation programs, it has not been abli to provide the Water, Forest and Hunting Department, in charge of the long-term management of such projects, with the necessary means. Neither has the government been able to improve the management and control of forest resources. It is an evidence that Benin's forest development strategy is not well grounded. Therefore, a new start up is necessary in order to develop an adequate national forestry policy and to provide the means for its implementation. This approach will necessarily start with pilot projects. This explain. why the government of Benin has requested the support of international organizations for the development and funding of the "Forestry Projoct" which will later be referred to as the "Forestry Development Project," in documents. The project was identified by a World Bank mission to Benin in November 1981, based on a UNDP/FAO report and another report produced in 1979 by a team of forestry experts from the Federal Republic of Germany. The project development was carried out by a World Bank/FAO cooperation program team which came to Benin in October 1982 and wrote the CP-BEN Report No.5/83. Document No. 128.904 (2). The project evaluation, based on that report, was carried out by an IDA team which worked in Benin in March 1983 and composed of Messrs Robert Fishwick and Robert Crown, Mrs. Rapeepun Jaissard, and Mr. Wolfgang Hannover (consultant). This evaluation report will become project paper (prodoc) No. 4687- BEN of May 29, 1984, the official draft for the five-year project, July 1984 to June 1989. For ease of procedure, a project year will be from July 1 of a civil year to June 30 of the following one. According to this document, the project includes plantations to be created in two ecologically distinct zones: the Lama forest in the South and the Toui forest In the Center-North of the country (see map). 3.2. OBJECTIVES 3.2.1. Overall obiectives Civen the increasing degradation of forest resources and the increasing needs of the population in wood products, the supply of these products in sufficient quantity and at reasonable cost was among the government priorities. The implementation of such policy necessitates the creation of new supply sources on the one hand and the _trengthening of forest resources management structures on the other. In this context and according to the appraisal report, the project: a) will improve the capacities of the DEFC, responsible for the management o;˘ natural forest resources and plantations in Benin, and will provide the necessary means for data collection and analysis in order to develop an appropriate forestry strategy; b) will execute a plantation program to supplemnnt those already funded, in order to improve long term domestic wood supply and to reduce Benin's future dependance on imported timber. - 14 - 3.2.2. Specific oblectives More specifically, the project which aims at increasing domestic wood supply and improving the technical and financial management capacities in the forestry sector, will involve the following: a) reinforcing the DEFC by setting up a unit for general policy and advice; b) establishment and maintenance of a 3,80C ha teak plantation in the Lama gazetted forest; c) establishment of about 410 ha pilot plantations in the Lama and Toui gazetted forests; d) scholarships and training for the fwrestry personnel; ana e) execution of studies for the .ormulation of forestry development strategy, mid-term assessment of ongoing activities in the forestry sector, and preparation of future forestry development project. The reinforcement of the DEFC consists of equipment, material, and technical support in order to establish therein, a permanent Information and Orientation Service, responsible for the strategic planning and programming and the management and control of sector finances. The 3,800 ha (principally teak) plantation in the Lama forest will be completed over the five years of the project, as shown in table No.1: TABLE NO.1: CLEARING, PLANTING, AND MAINTENANCE PROGRAM (IN HAs) CIVIL YEARS 1984/85 1985/86 1986/87 1987/88 1988/89 Project year 1 2 3 4 5 Clearing & 200 600 1,000 1,000 1,000 Preparation Planting 200 600 1,000 1,000 3,800 Maintenance 200 800 1,800 2,800 Source: Report No. 4687-BEN of May 29, 1984 This program additionally includes the construction of buildings and laterite roads (access and boundary -oads) in the Lama forest, the construction of an office and a workshop-warehouse at Saclo. As for the pilot plantations, they provided the opportunity to test some improved species and foreign breeds, some planting and maintenance techniques, and some charcoaling techniques for charcoal production. The project document does not contain a chronogram with quantified objectives for these activities. IV. PROJECT ORGANIZATION AND MANAGEMENT 4.1. INSTITUTIONAL FRAMEWORK The project is managed for the government by the Water, Forest and Hunting Department of the Ministry for Rural Development. The Water, Forest and - 15 - Hunting Director is directly responsible for the overail i.plementation and management of tMe project. The project is run by a national Director assisted by a forestry expert and an accounting expert who is the controller. To attain the objectives, the project was divided into three parts A, B, and C as follows: Part A: "Reinforcement of the DEFC." This concerns the institutional strengthening rientioned earlier among the objectives. Part B: "Reforestation of the Lama," whereby the 3,800 ha plantation will be established. Part C: "Pilot Plantations" or "Research aspect." Based on paragraph 4.01 of the evaluation report, some of the projects parts were contracted to external structures. Thus, part B "Reforestation of the Lama" was carried out by thA national wood company ONAB, under contract No. 002/EFC/PDF ot August 2, 1985 between the DEFC and ONAB. Part C "Researc'h" was contracted to the Forestry Research Unit (UR') at the Agricultural Research Department (DRA). According to these contracts: - the DEFC iH responsible for the funding and control of all activities, - ONAB and URF/DRA are, within their respective competences, in charge of the physical implementation of activities. Therefore, each of these contractors must submit to the DEFC, their plannings on the one hand and their progress reports on the other hand, according to a calendar well defined in the contracts. Part A "Reinforcement of the DEFC" was carried out by the DEFC directly, acting through a team including the project Director and technical assistants. 4.2. PROJECT COST AND FUNDING The project I was estimaced for a global cost of F CFA 5,Gd1 million with taxes and F CFA 4,529 million tax free. This includes an AID credit (No. 1505-BEN), an AID Special Fund credit (No. SF-24-BEN), a contribution from the Federal Republic of Germany (FRG), and Benin's own contribution. The contribution from the Federal Republic of Germany consisted of a KfW loan and a GTZ grant. Table No.2 is a summary of the financing plan, as shown in the appraisal report: X Costs were estimated at FCFA 392 to 1 U.S.Dollar, which was the official exchange rate at the time of negotiations in November 1983. - 16 - TABLE No.2 : Financing Plan by source. (F CFA millions) Funding Cost (tax free) % Coot (tax incl.) % source IDA 1,038 23 1,038 20 FS/IDA 1,080 24 1,080 21 GFR 1,564 43 1,964 39 BENIN 447 10 999 20 TOTAL 4,529 100 5,081 100 The distribution of costa across the project components is an follows: -Strengthening DEFC ................ F CPA Million 543 -Lama Reforestation ............... F CFA Million 4,214 -Pilot Plantations ................. F CFA Million 324 TOTAL F CFA Million 5,081 The draft financing plan presented by the report is in Attachment 2 to this report. IDA, IDA Special Fund, and KfW credits are provided according to normal IDA conditions, _ 17 - V. RESULTS The project was effectively implemented from 1985 to 1990 and the results are roughly presented herebelow and then .-alyzed and discussed in another auction. 5.1. PART A: REINFORCEMENT OF DEFC Part A essentially constoted of providing technical assistance including two experts, all German nationals, and hiiud through international bidding (technical assistance contract No. 001/PDF/EFC/MDRAC of March 22, 1985). One expert, the forestry Advisor, was hired for five years from May 1985 to May 1990 et the other, the financial Controller, was hired for three years from 1985 to 1988. At the expiry of the latter's contract, he was replaced by his national counterpart until the end of the project. Each of these assistants worked according to the task a,signed to him. Their performances were more qualitative than quantitative since these Assistants have participated in many activities initiated by the DEFC. For instance, they helped with the drafting of the forestry code and hunting regulations, and with the restructuring of the DEFC organigram (creation of a Studias and Development Service). Apart form this technical assistance, there are other physical achievements to the credit of part A. Besides the supply of some vehicles, there are also: - the building of an administrative center in Cotonou, jointly with the African Development Bank (ADB), as part of the latter's participation in the South Benin Fuelwood Plantation project. The project team moved into this building on May 10, 1988; - the purchase of technical documentation for the DEFC Documentation Center as well as two wooden bookcases for their storage; - the purchase of a special cabinet for the personnel's filoe, 500 identification sheets, and a wall synoptic board with 500 entries. Finally, there were some specific bvt very much appreciated support actions towards the DEFC. 5.2. PART B: LAMA REFORESTATION With respect to the initial objectives, the achievements of the reforestation part can be presented as follows: YEAR 1986 1987 1988 1989 1990 TOTAL Forecast 200 600 1,000 1,000 1,000 3,800 (ha) Achievement 200 600 820 740 843 3,203 (ha) A total area of 3,203 ha was planted against the 3,800 ha forecast, with a success rate of 84,29 %. The office and workshop building planned for Saclo were also completed. As regards the feedeL. -oads, a total ne'work of 600 km laterite roads were constructed plus 38 small bridges, two wells, and eight buildings. - 18, - Besides, there was also a support program involving mainly the resettlement of forest populat .ons and their reinotallat.on in two agro-forestry centers. Thus, within the framework of the protection -f the gazetted f')rest, KfW has, in addition to its mandatory contribution, sponsored the protection of the core area of the forest and a complementary agro-foreotry program. Two agro- forestry centers of 200 ha each, were established for the resettlement of 200 Holli families. The program also provided them with social facilities like a market, a school, wells, etc.. For the protection of the central nucleus, a forestry brigade was set up by the DEFC, to which adequate equipment was furnished by XfW. 5.2. PART C: PILOT PLANTATIONS According to the basic project documents, the Forestry Research Unit of the DRA has carried out its tests in two ecologically different zones: - the Lama site at about 80 km from Cotonou with a guinean equatorial type of climate and two rainy seasons. Soils are "vertisoils" difficult to cultivate; - the Toui site, further north, at about 350 km from Cotonou with a sudano-guinean climate and only one rainy season. This site is characterized by tropical leached ferruginous soils. Pilot plantations cover 60 ha at Toui and 40 ha in the Lama, thus totalizing 100 ha out the 110 initially p'anned. Research work was carried out in the following fields: - introduction of exotic and local species into natural forests; - association of species; - attempts on new species sources; - attempts of mychorization and direct sowing on Afzelia africana; - studies on forest species germination in tree nurseries; - observatory teak plantation; and - planting techniques for Tectona grandis (teak) and Khaya senegalensis (cailcedrat). These various tests w.re performed on firewood and timber species with average revolution. A comprehensive list of these species is providad in Attachment 3. VI. ANALYSIS OF RESULTS 6.1. APPRAISAL OF RESULTS 6.2.1. Part A In general, the strengthening activities are not satisfactory because most fundings went to technical assistance which did not permit any involvoment in specific actions. Both technical assistance and the other resources provided should have been fully integrated to the daily life of all DEFC offices. Such integration seemed to have started satisfactorily at one point but was quickly dropped. Neither was there any proper training in this part. - 19 - The foregoing results from the fact that the strengthening of the DEFC was not clearly defined from the outset in terms of specific objectives and related act,vities. This explains why the Studies and Development Unit, initially intended as an Information and Orientation department, became redundant and worked separately from the project implementation team. The financial controller has established an analytical accounting for the project, but not for the whole forestry sector as intended in the documentation. It is, however, interesting to note that the building construction at the DEFC is a valuable achievement, in that it helps solve the space problems by accommodating part of the Cotonou-based personnel. It is also worth recalling the various informal inputs that were provided to the DEFC in its routine operations. 6.1.2. Part B Achievements here are satisfactory in general. In fact, 3,203 ha out of 3,800 have been planted, whicn gives a 84.29 % success rate, in addition to the building constructions. The uncompleted part of plantations is due to the quality of the Lama soils (vertisoils) which are rather hard to cultivate. The support component enhances the degree of satisfaction since the Lama case is an example of parzicipative forest management with resident populations, where each party involved has been fully satisfied. Furthermore, 18 to 20 % of the project labor came from the resettled populations as paid job and the project also provided community infrastructures such as roads. The project also has the merit of introduciag a new species of teak in Benin and testing the sowing of seeds grown in plastic bags as opposed to stumps. Now, only the economic and financial analysis of this part will permit any final conclusione on these activities. 6.1.3. Part C In part C, only 24.39 % of plantations were completed, i.e. 100 ha out of 410. Neither has it been possible to identify new charcoaling techniques or even start experimentations in that respect. Since most attempts were made between 1987 and 1990, it is still difficult, premature, and risky to make any statements as to whether any of the newly introduced species has uieen a success or a failure. The conservatory teak plantation is valuable to the extent that it involves five very rare varieties of that species, from Thailand and India. It is also interesting to note that Research has worked on local species of the natural forest with average revolution. This is all the more important since in the Lama particularly, possible alternatives to an almost exclusive monoculture of teak, as is currently the case, is under study. Nevertheless, it has to be noted that the level of achievement could have been higher if the appraisal report had provided a chronogram with quantified objectives, or better, if the Forestry Research Unit had a real research program ready for implementation. The latter aspect should be given more emphasis in the future. 6.2 PERFORMANCE ASSESSMENT 6.2.1. Bank's Performances Regular and periodic supervisory missions from the Bank, two missions per year, enabled a permanent monitoring of the project. Reports by all supervisory missions stated that progrees was satisfactory. Such regular - 20 - monitoring contributed to the effective training of the national Financial Controller who was then able to manage correcUly the project finances. The Bank accepted to cooperate with the ADB in the construction of the administrative center in Cotonou. It has to be noted here, that at a conceptual level, the Bank, in its report No. 4687-BENN, shared the erroneous view that the forestry department was mainly devoted to repression. Such improper assumptions were, thus, used as the basis for most contracts. In fact, these contracts were unrealistic since: - ONAB and the DRA/URF selected personnel from the DEFC to implement their contracts, which means that the DEFC did have the required capacities; and - it was the project which provided all the necessary equipment to the contractors, as it could have done to the DEFC. The Dank has not been able to turn the Studies and Development Service into a real information and orientation unit although it had intended to improve the performances of the various DEFC departments. While acknowledging the success of its first forestry project in Benin, the Bank did not encourage a follow up project as a means to consolidate these achievements. It would rather welcome a larger and more ambitious Natural Resources Management program whose pilot phase is not really a follow up of the Forestry Development Project. It would be interesting that great emphasis be put on the forestry sector in this program. 6.2.2. Co-sDonsors' Rerformances KfW : From a financial viewpoint, KfW which is the German co-sponsor has shown ---her positive performances. Indeed, knowing the financial difficulties of the country and for practical calendar and area considerations, KfW agreed to entirely sponsor Benin's counterpart contribution to part B, for a total amount of F CFA 275 million. KfW also participated in the functioning of the Lama forest brigade by providing the necessary equipment. Finally, KfW accepted to support the post-project maintenance costs of the Lama plantations. Such costs will be taken into account for the Lama reforestation follow-up project entirely sponsored by the FRG. BENIN : Despite the ongoing economic crisis during the project implementation, the government made a valuable effort by disbursing it's counterpart contribution, after part of it had been paid by the FRG. This is an evidence of the government's interest in this project, as was already shown by their good disposition and assistance to all Word Bank missions sent to Benin in that respect. AFRICAN DEVELOPMENT BANK The ADB was not a co-sponsor as such but is worth mentioning that they accepted to collaborate with the World Bank in the building of an office block for the managements of both the "Forestry Development" project (IDA) and the "Fuelwood Plantation in South Benin" project (ADB). In sum, the Forestry Development Project provided an excellent cooperation opportunity between the World Bank, KfW, and the Government of Benin. - 21 - 6.2.3. Institutions' Performances D.E.F.C. : The Water, Forestry and Hunting Department, the chief supervisor for the project, has performed according to the basic locuments and to the norms and procedures established by the World Bank. As such, it carried out an audit every year, after each budgetary exercise. Successive audit reports have shown that in general, the project management went on improving, at least as far as the DEFC's responsibility is concerned. Due consideration to the initial suggestions by the Forestry Advisor, resulted in the revision of the forestry department organigram. The DEFC has also provided assistance to all project-related World Bank mission to Benin. But the DEFC has suffered a major handicap in its difficult task. Indeed, the contractor for part B, which received the greatest share of the funding, was given full management autonomy and thereby, withdrawn from the supervision of the DEFC who was yet liable for the whole project. ONAB: The National Wood Company has carried out the installation of plantations as scheduled for part B. But there were no management plans with a schedule of necessary clearings to conduct the plantation as provided in article 2 of contract No. 002/EFC/PDF between the DEFC and ONAB. Similarly, ONAB did not respect articles 8 and 10 of the contract relating respectively to the submission of the different progress reports and of the land cL.aring products. URF-D A The Forestry Research Unit (URF) of the Agricultural Research Department did not perform well in the implementation of part C of the project but was rather groping or even improvising. This was the results essentially of the lack of a well defined and well developed research program from the outset. However, it has the merit of undertaking the promotion of local species by including them in their various tests. As regards the correct implementation of this part, under contract 003/EFC/PDF with DEFC, the DRA has been sloppy towards the URF which is yet under its coordination. Article 4 of the contract, relating to the modalities of progress reports eubmitted to the DEFC, has been openly violated. - 22 - VII. PROJECT ItiPACT 7.1. ON NATIONAL INSTITUTIONS DEFC : The Forestry Development Project has provided the opportunity for the Water, Forest and Hunting Director, the National Project Director, the local Financial Controller and a number of DEFC experts to experience, to various degrees, some of the World Bank procedures, which will be a valuable asset in the management of future projects to be sponsored by this institution. This is what enabled the excellent collaboration between local and foreign experts as regards the Natural Resources Management Project (NRMP) preparatory missions. The project helped strengthen the capacities of the local Financial Controller who has now been nominated to run the Materials and Finance Department at the DEFC concurrently with the management of the NRMP preparaticn fund. Worth mentioning also is the very positive impact of the building erected within the DEFC jointly with the ADB. ONAB : The establishment of part B within ONAB has been very useful to that company as the project budget was also used for it's own operations for the whole duration of the project. It was thus, a golden opportunity in terms of equipment and operating expenses. Some of the ONAB experts were given the opportunity to learn techniques used elsewhere for teak growing. URF : Apart form receiving equipment and becoming more operational, the Forestry Research Unit also became convinced of the necessity of developing a real research program which would provide guidelines for all its future activities. 7.2. ON THE PROJECT SITE The project has provided employment opportunities by utilizing local labor: - in Toui, the project has provided substantial revenues to all workers; - in the Lama forest, despite the adequate equipment, many activities were left to the residents. The project also contributed to the achievement of community social infrastructures for the Lama forest and neighboring populations. As for environmental protection, there are no more bushfires or clearings in the core area since 1987. 7.3. ON BENIN FORESTRY SECTOR The Forestry Development Project implementation has made a valid contribution to the redynamization of the forestry sector in Benin. Indeed, the project has permitted : - the introduction of a new teak variety into Benin; - to install a rare varieties seed orchard; - 23 - - to initiate a large scale natural resources management program, even though such program is not exclusively for the forestry sector; - to associate DEFC experts to the NRMP preparatory missions, thus enabling their awareness of a number of valuable concepts and strategLes; and - to teach resident populations that the lack of government development projects in gazetted forests is not a waiver of State rights on such forests. Activities implemented in Toui will enable the identification of certain species which are adapted to the central region of the country (sudano- guinean climate), as part of the forest development activities in that ecological zone. VIII. CONCLUSIONS AND RECOMMENDATIONS The Forestry Development Project, which is the first World Bank- sponsored forestry program in Benin, has been globally positive but with variations across the different components. Such positive result is due to both weak and strong points as already mentioned earlier. The program has offered an excellent opportunity for cooperation and collaboration between Benin and its partners on one hand and between national institutions on the other hand. It also provided the evidence that, unlike what might be believed in some places, the DEFC does have the necessary capacities to prepare and implement programs for the development of natural resources, especially as regards the forestry sector. From lessons learned and experience, the following recommendations can be made for a possible follow-up phase or for any other forthcoming similar projects - clear definition of the content of the institutional reinforcement component with a view to strengthening existing structures to make them more performative. This will avoid, for instance, duplications of services with the same attributions, as was the case for the "Information and Orientation Service" and the "Studies and Development Service." Thus, the targeted institution could specify at the beginning of each year, the specific capacities to be reinforced; - contracting should no longer be a prerequisite for the implementation of activities but just an alternative for the management, based on the specific capacities needed; - permanent technical assistance should be avoided to the benefit of the training of local experts. However, a local counterpart should be appointed for every technical assistant position, and to whom the technical assistant would have to transfer the necessary skills by the end of the contract; - given hi. outstanding performance in managing the project finances to the end, the financial controller could be considered for participating in the training of other specialists in the field; - for the development of natural resources in general and forest resources in particular, it is important that real research programs be developed according to the new forest ecosystem and village land management orientations; - for efficiency and exchange of experience purposes, it will be necessary to hold periodic evaluation and concertation meetings among all the various structures involved in project implementation; - in the perspective of developing a national forestry policy, some project-related studies should be completed. Collaboration with NGOo would be highly recommended in this matter; - 24 - - in order to consolidate project achievements for their custainability, it is advisable that, the NRMP focus more on the forestry sector. This would ensure a better environmental management through participative forestry programs and prevention of bushfires. ATTACHMENT 3 : SPECIES USED IN THE PART C (RESEARCH) TESTS -Acacia ampliceps -Acacia auriculiformis -Acacia holosericea -Acacia maconochiecana -Acacia mangium -Acacia nilotica -Acacia polyacantha -Acacia seyal -Acacia tenuissima -Acacia tumida -Afzelia africana -Anogeissus leiocarpus -Antiaris africana -Azadirachta indica -Cedrela odorota -Ceiba pentandra -Chlorophora excelsa -Dalbergia sissoo -Eucalyptus camaldulensis -Eucalyptus torreliana -Gmelina arborea -Holoptelea grandis -Hymaneae courbaril -Isoberlinia doka -Khaya grandifoliola -Khaya senegalensis -Leucaena leucocephala -Maesopsis eminii -Peltophorum ferrugineum -Prosopis chilensis -Pseudocedrela koschii -Pterocarpus erinaceus -Tectona grandis -Terminalia ivorensis -Terminalia superba -Triplochyton scleroxylon. 5 PART III: STATISTICAL IY'FORMATION 1. Related Bank Loans and/or Credit.s Credit Title Purpose - Year of Approval Status Zou-Borgou To stimulate production 1972 Cancelled Cotton Project of cotton Credit 307-BEN _ Technical To strengthen SONADI and 1977 Completed Assistance Project CARDER and prepare Credit 716-BEN agricultural investment _ projects Borgou Rural To improve rural income 1981 Closed Development Project through expanded Credit 1127-BEN agricultural production Zou Province To improve rural income 1982 Under SPN Rural Developt. through expanded Project production Credit 1314-BEN Atacora Rural Dvpt. To strengthen extension 1982 Closed Project: IFAD service and increase IFAD; 101-BEN food production Second Borgou To consolidate gaina of 1988 Under SPN Rural Dvpt. Project first project, prepare Credit 1877-BEN medium-term progran for rural sector, reorganize cotton sub-sector Agricultural To improve provision of 1992 Approved, Services agricultural services not yet Restructuring through restructuring of effective Project agricultural institutions Natural Resources To promote more 1992 Approved, Management Project sustained and not yet responsible management effective of renewable resources - 26 - 2. PROJECT TIMETABLE Item Planned Revised Actual Date Comments (1) Date Date _ Identification N.A. N.A. 11/81 Preparation N.A. N.A. 10-12/82 a), b), c) Appraisal 9/83 3/83 3/83 d), e), f) Negotiations 11/83 11/83 11/83 Board Approval FY 85 2/84 6/84 Signature N.A. N.A. 7/84 Effectiveness 6/84 11/84 7/85 Completion 6/89 N.A. 9/90 Closing 6/90 12/90 12/90 _ Notes (1) Issues raised: a) Institutional weakness b) Donors' coordination c) Availability of Government funds d) Plantation executing agency e) Land use management plan for Lama Reserve f) Fuelwood/Charcoal supply strategy (2) N.A. = Not Available - 27 - 3. CREDIT DISBURSEMENTS A. Cumulative Estimated and Actual Disbursement ESTIMATE ACTUAL Percentage IDA FISCAL YEAR OUARTER DISBURSEMENT CUMULATIVE DISBURSEMENT CUMULATIVE ACT/EST. (cumiutative) 1985 3 16 16 4 524 540 1986 1 41 581 38 38 7 2 266 847 5 44 5 3 121 968 1,017 1,061 110 4 181 1,149 197 1,258 109 1987 1 161 1,310 133 1,391 106 2 356 1,666 395 1,786 107 3 202 1,868 743 2,529 135 4 202 2,070 111 2,639 128 1988 1 243 2,313 319 2,958 128 2 458 2,771 282 3,240 117 3 202 2,973 474 3,713 125 4 202 3,175 334 4,048 127 1989 1 202 3,377 270 4,318 128 2 401 3,778 694 5,011 133 3 202 3,980 0 5,011 126 4 202 4,182 394 5,406 129 1990 1 162 4,344 600 6,005 138 2 268 4,612 171 6,176 134 3 122 4,734 9 6,185 131 4 161 4,895 114 6,299 129 1991 1 162 5,057 0 6,299 125 2 121 5,178 107 6,406 124 3 61 5,239 0 6,406 122 4 61 5,300 0 6,406 121 1992 1 60 5,360 0 6,406 120 2 40 5,400 0 6,d,06 119 NOTE: TotaL cumuLative actual disbursements are highei' than planned because of the depreciation of the dollar with respect to the SDR over the period. (See foltowing page) - 28 - 3. CREDIT DISBURSEMENTS B. SOR-USS Exchange RATE USS DISBURSEMENT SOR DISBURSEMENT SDR/USS X DISBURSEMENT WEIGHTED mAE (US) RATE 1985 JuLy 30,845 29,734 1.04 0.48 0.005 August September 7,489 7,143 1.05 0.12 0.001 December 5,487 5,040 1.09 0.09 0.001 1 96 February 1,016,863 908,252 1.12 15.87 0.178 ApriL 11,683 10,266 1.14 0.18 0.002 May 185,189 162,000 1.14 2.89 0.033 July 133,438 111,609 1.20 2.08 0.025 October 186,948 153,163 1.22 2.92 0.036 November 208,230 173,522 1.20 3.25 0.039 December 1987 February 669,580 526,351 1.27 10.45 0.133 March 72,940 57,060 1.28 1.14 0.015 June 110,713 86,195 1.28 1.73 0.022 August 318,536 246,663 1.29 4.97 0.064 October 42,945 33,266 1.29 0.67 0.009 December 238,876 172,218 1.39 3.73 0.052 1988 March 473,666 347,082 1.36 7.39 0.101 April 79,372 57,481 1.38 1.24 0.017 May 183,232 132,902 1.38 2.86 0.039 June 71,839 52,877 1.36 1.12 0.015 July 118,031 90,842 1.30 1.84 0.024 August 151,743 117,074 1.30 2.37 0.031 November 132.960 99,137 1.34 2.08 0.028 December 560,829 414,342 1.35 8.76 0.119 1989 June 394,110 317,484 1.24 6.15 0.076 August 573,870 455,501 1.26 8.96 0.113 September 25,703 20,834 1.25 0.40 0.005 October 170,838 133,536 1.28 2.67 0.034 1990 January 9,167 6,996 1.31 0.14 0.002 June 114,020 86,975 1.31 1.78 0.023 November 106,553 73,574 1.45 1.66 0.024 1991 June 0 0.50 .00 0.000 TOTAL 6,405,693 5,089,118 100.00 1.27 AppraisaL Report Exchange rate 1.06 Dollar Depreciation 19.49 (percent) - 29 4. PRQJECT IMPLEMENTATION Item Unit Appraisal Estimate Actual (or PCR estimate) A. Lama Plantation New Plantings Ha 3,800 3,203 Access Roads Km 1 5 1 5 Plantation Tracks Km 38 35 Protection Tracks Km 20 1 8 Salvage Logging m3 76,000 Negligible Of which: __ ___ _ _ Logs m3 9,500 Negligible Poles m3 9,500 Negligible Fuel m3 57,000 Negligible Farmers' houses Unit 0 200 Resettled Farmers Unit 200 200 Schools Built Unit 0 2 Water Reservoir Unit 0 1 Borehole Unit 0 1 B. Re earch Work _ . L Pilot Plantation Ha 410 100 - 30 - 5. PROJECT COSTS AND FINANCING A. Project Costs (UISS '000) ------Appraisal Estimate ----- . . .Actual- ---- Local Foreign Total Locat Foreign Total A. LAMA PLANTATION Vehicles, machinery, equipment 610 2,624 3,234 737 3,140 3,877 Plantation establishment 1,480 951 2,431 2,281 1,457 3,738 BuiLdings & roads 418 346 764 898 734 1,632 Technical Assistance, training 51 831 882 74 1,152 1,226 Farmers' resettlement 400 133 533 Sub-total 2,559 4,752 7,311 4,390 6,616 11,006 B. PILOT PLANTATION PROGRAM Vehicles, machinery, equipment 66 288 354 8 34 42 Plantation establishment 135 89 224 77 50 127 .... .... .... .... . .... . Sub-Total 201 377 578 85 84 169 C. STRENGTHENING OF DEFC Vehicles and equipment 20 87 107 38 72 110 Operating Costs 105 112 217 88 95 183 Technical Assistance & Consulting 75 624 699 121 976 1,097 Administrative Building 8 14 22 Sub-Total 200 823 1,023 255 1,157 1,412 D. CONTINGENCIES Physical Contingencies 210 442 652 Price Contingencies 1,532 1,866 3,398 Sub-Total 1,742 2,308 4,050 TOTAL PROJECT COSTS 4,702 8,260 12,962 4,730 7,857 12,587 - 23 - - to initiate a large scale natural resources management program, even though such program is not exclusively for the forestry sector; - to associate DEFC experto to the NRMP preparatory missions, thus enabling their awareness of a number of valuable concepts and strategies; and - to teach resident populations that the lack of government development projects in gazetted forests is not a waiver of State rights on such forests. Activities implemented in Toui will enable the identification of certain species which are adapted to the central region of the country (sudano- guinean climate), as part of the forest development activities in that ecological zone. VIII. CONCLUSIONS AND RECOMMENDATIONS The Forestry Development Project, which is the first World Bank- sponsored forestry program in Benin, haa been globally positive but with variations across the different components. Such positive result is due to both wea. and strong points as already mentioned earlier. The program has offered an excellent opportunity for cooperation and collaboration between Benin and its partners on one hand and between national institutions on the other hand. It also provided the evidence that, unlike what might be believed in some places, the DEFC does have the necessary capacities to prepare and implement programs for the development of natural resources, especially as regards the forestry sector. From lessons learned and experience, the following recommendations can be made for a possible follow-up phase or for any other forthcoming similar projects s - clear definition of the content of the institutional reinforcement component with a view to strengthening existing structures to make them siore performative. This will avoid, for instance, duplications of services with the same attributions, as was the case for the "Information and Orientation Service" and the "Studies and Development Service." Thus, the targeted institution could specify at the beginning of each year, the specific capacities to be reinforced; - contracting should no longer be a prerequisite for the implementatior. of activities but just an alternative for the management, based on the specific capacities needed; - permanent technical assistance should be avoided to the benefit of the training of local experts. However, a local counterpart should be appointed for every technical assistant position, and to whom the technical assistant would have to transfer the necessary skills by the end of the contract; - given his outstanding performance in managing the project finances to the end, the financial controller could be considered for participating in the training of other specialists in the field; - for the development of natural resources in general and forest resources in particular, it is important that real research programs be developed according to the new forest ecosystem and village land management orientations; - for efficiency and exchange of experience purposes, it will be necessary to hold periodic evaluation and concertation meetings among all the various structures involved in project implementation; - in the perepective of developing a national forestry policy, some project-related studies should be completed. Collaboration with NGOs would be highly recommended in this matter; - 24 - - in order to consolidate project achievements for their sustainability, it is advisable that, the NRMP focus more on the forestry sector. This would ensure a better environmental management through participative forestry programs and prevention of bushfires. ATTACHMENT 3 : SPECIES USED IN THE PART C (RESEARCH) TESTS - Acacia ampliceps - Acacia auriculiformis - Acacia holosericea - Acacia maconochiecana - Acacia mangium - Acacia niloti.ca - Acacia polyacantha - Acacia seyal - Acacia tenuissima - Aca-ia tumida - Afzelia africana - Anogeissus liocarpus - Antiaris africana - Azadirachta indica - Cedrela odorota - Ceiba pentandra - Chlorophora excel3a - Dalbergia sissoo - Eucalyptus camaldulensis - Eucalyptus torreliana -Gmelina arborea -Holoptelea grandis -Hymaneae courbaril - Isoberlinia ioka - Khaya grandifoliola - Khaya senegalensis - Leucaena leucocephala -Maesopsis eminii - Peltophorum ferrugineum - Prosopis chilensis - Pseudocedrela koschii - Pterocarpus erinaceus - Tectona grandis - Terminalia ivorensis - Terminalia superba - Triplochyton scleroxylon. 2 25 - PART III: STATISTICAL INFOKMATION 1. Related Bank Loans and/or Credits Credit Title Purpose Year of Approval Status Zou-Borgou To stimulate production 1972 Cancelled Cotton Pi3ject of cotton Credit 307-BEN l Technical To strengthen SONADI and 1977 Completed Assistance Project CARDER and prepare Credit 716-BEN agricultural investment projects I Borgou Rural To improve rural income 1981 Closed Development Project through expanded Credit 1127-BEN agricultural production Zou Province To improve rural income 1982 Under SPN Pural Developt. through expanded Project production Credit 1314-BEN _ Atacora Rural Dvpt. To strengthen extension 1982 Closed Project: IFAD service and increase IFAD: 101-BEN food production _ Second Borgou To consolidate gains of 1988 Under SPN Rural Dvpt. Project first project, prepare Credit 1877-BEN medium-term program for rural sectcr, reorganize cotton sub-sectcr I Agricultural To improve provision of 1992 Approved, Services agricultural services not yet Restructuring thrcugh re3structuring of effective Project agricultural institutions l Natural Resources To promote more 1992 Approved, Management Project sustained and not yet responsible management effect ve of renewable resources - 26 - 2 2. PROJECT TIMETABLE Item Planned Revised Actual Date Comments (1) Date Date Identification N.A. N.A. 11/81_ Preparation N.A. N.A. 10-12/82 a), b), C) Appraisal 9/83 3/83 3/83 d), e), f) Negotiations 11/83 11/83 11/83 Board Approval FY 85 2/84 6/84 Signature N.A. N.A. 7/ _84 Effectiveness 6/84 11/84 7/85 Completion 6/89 N.A. 9/90 Closing 6/90 12/90 12/90 Notes (1) Issues raised: a) Institutional weakness b) Donors' coordination c) Availability of Government funds d) Plantation executing agency e) Land use management plan for Lama Reserve f) Fuelwood/Charcoal supply strategy (2) N.A. = Not Available - 27 - 3. CREDIT DISBURSEMENTS A. Cumulative Estimated and Actual Disbursement ESTIMATE ACTUAL Percentage IDA FISCAL YFAR OUARTER DISBURSEMENT CUMULATIVE DISBURSEMENT CUMULATIVE ACT/EST. (cumulative) 1985 3 16 16 4 524 540 1986 1 41 581 38 38 7 2 266 847 5 44 5 3 121 968 1,017 1,061 110 4 181 1,149 19?' 1,258 109 1987 1 161 1,310 133 1,391 106 2 356 1,666 395 1,786 107 3 202 1,868 743 2,529 135 4 202 2,070 111 2,639 128 1988 1 243 2,313 319 2,958 128 2 458 2,771 282 3,240 117 3 202 2,973 474 3,713 125 4 202 3,175 334 4,048 127 1989 1 202 3,377 270 4,318 128 2 401 3,778 694 5,011 133 3 202 3,980 0 5,011 126 4 202 4,182 394 5,406 129 1990 1 162 4,344 600 6,005 138 2 268 4,612 171 6,176 134 3 122 4,734 9 6,185 131 4 161 4,895 114 6,299 129 1991 1 162 5,057 0 6,299 125 2 121 5,178 107 6,406 124 3 61 5,239 0 6,406 122 4 61 5,300 0 6,406 121 1992 1 60 5,360 0 6,406 120 2 40 5,400 0 6,406 119 NOTE: Total cumulative actual disbursements are higher than planned because of the depreciation of the dollar with resp?ct lo the SOR over the period. (See fotlowing page) - 28 - 3. CREDIT DISBURSEMENTS B. SDR-USS Exchange RATE USS DISBURSEMENT SDR DISSURSEMENT SDR/USS X DISBURSEMENT WEIGHTED REM _ .USS . RATE 1985 July 30,845 29,734 1.04 0.48 0.005 August September 7,489 7,143 1.05 0.12 0.001 December 5,487 5,040 1.09 0.09 0.001 1 98o February 1,016,863 908,252 1.12 15.87 0.178 Aprit 11,683 10,266 1.14 0.18 0.002 May 185,189 162,000 1.14 2.89 0.033 July 133,438 111,609 1.20 2.08 0.025 October 186,948 153,163 1.22 2.92 0.036 November 208,230 173,522 1.20 3.25 0.039 December 1987 February 669,580 526,351 1.27 10.45 0.133 March 72,940 57,060 1.28 1.14 0.015 June 110,713 86,195 1.28 1.73 0.022 August 318,536 246,663 1.29 4.97 0.064 October 42,945 33,266 1.29 0.67 0.009 December 238,876 172,218 1.39 3.73 0.052 1988 March 473,666 347,082 1.36 7.39 0.101 April 79,372 57,481 1.38 1.24 0.017 May 183,232 132,902 1.38 2.86 0.039 June 71,839 52,877 1.36 1.12 0.015 JuLy 118,031 90,842 1.30 1.84 0.024 August 151,743 117,074 1.30 2.37 0.031 November 132,960 99,137 1.34 2.08 0.028 December 560,829 414,342 1.35 8.76 0.119 1989 June 394,110 317,484 1.24 6.15 0.076 August 573,870 455,501 1.26 8.96 0.113 Septefmtber 25,703 20,834 1.25 0.40 0.005 October 170,838 133,536 1.28 2.67 0.034 1990 January 9,167 6,996 1.31 0.14 0.002 June 114,020 86,975 1.31 1.78 0.023 November 106,553 73,574 1.45 1.66 0.024 1991 June 0 0 0.50 0.00 0.Q00 TOTAL 6,405,693 5,089,118 100.00 1.27 AppraisaL Report Exchange ratc 1.06 Dollar Depreciation 19.49 (percent) - 29 - 4. PROJECT IMPLEMENTATION |ndicat_r_ Item Unit Appraisal Estimate Actual (or PCR estimate) A. Lama Plantation l New Plantings Ha 3,800 3,203 Access Roads Km 15 15 Plantation Tracks Km 38 35 Protection Tracks Km 20 1 8 Salvage Logging m3 76,000 Negligible Of which: ___ __I Logs m3 9,500 Negligible Poles m3 9,500 Negligible Fuel m3 57,000 Negligible Farmers' houses Unit 0 200 Resettled Farmers Unit 200 200 Schools Built Unit 0 2 Water Reservoir Unit 0 1 Borehole Unit 0 1 B. Research Work . l Pilot Plantation Ha 410 100 - 30 - 5. PROJECT COSTS AND FINANCING A. Project Costs (USS'000) ------Appraisal Estimate----- ------------Actual---------.-- Local Foreign Total Local Foreion Total A. LAHA PLANTATION Vehicles, machinery, equipment 610 2,624 3,234 737 3,140 3,877 Plantation establishment 1,480 951 2,431 2,281 1,457 3,738 Buildings & roads 418 346 764 898 734 1,632 Technical Assistance, training 51 831 882 74 1,152 1,226 Farmers' resettlement 400 133 533 Sub-total 2,559 4,752 7,311 4,390 6,616 11,006 B. PILOT PLANTATION PROGRAM Vehicles, machinery, equipment 66 288 354 8 34 42 Plantation establishment 135 89 224 77 50 127 Sub-Total 201 377 578 85 84 169 C. STRENGTHENING OF DEFC Vehicles and equipment 20 87 107 38 72 110 Operating Costs 105 112 217 88 95 183 Technical Assistance & Consulting 75 624 699 121 976 1,097 Administrative Building 8 14 22 Sub-Total 200 823 1,023 255 1,157 1,412 D. CONTINGENCIES Physical Contingencies 210 442 652 Price Contingencies 1,532 1,866 3,398 Sub-Total 1,742 2,308 4,050 TOTAL PROJECT COSTS 4,702 8,260 12,962 4,730 7,857 12,587 - 31 - 5. PROJECT COSTS AND FINANCING B. Project Financing (US$'000) 4p------------ AWraisaL Pian .......... ............. - Actua L.............. IDA FPG GVT TOTAL IDA FRO GVT TOTAL 1. Vehicles L Equlpmnnt 402 3,812 4,215 85 4,400 4,485 2. Forestry Works 2,975 1,082 4,057 4,082 1,329 483 5,894 3. ConsuLtants 911 911 1,026 1,026 4. TechnicaL Assisten 1,19.° 1,199 1,200 1,200 5. Operating Costs 32 59 90 194 59 253 6. InitiaL Costs 352 352 -25 -25 7. PPF 156 156 31 31 8. UnaLtocated 573 573 9. Taxes ___ __ 1.4M - - - - TOTAL 5,400 5,011 2,549 12,961 5,393 6,929 542 12,864 - 32 - 6. Project Results A. Direct Results Indicator Appraisal Estimate Present Estimate (PCR) Average Mean Ar,nual Incrernent 11.5 12.8 (M.A.I.) in m3/ha/year B. Economic Impact Economic Rate u; Return 14.5% 14.3% C. Basic Assumgtions of Economic Impact The economic analysis of the project was calculated on the same basis as the appraisal report. In both cases, the costs included are the costs of the Lama plantation. Like it! the appraisal report, the cost of the pilot plantations have been included. The costs of technical assistance and training have been excluded as they would have mainly long term unquantifiable benefits. The benefits include the wood produced and salvage logging at the Lama plantation valued at economic prices. Unlike in the appraisal report, benefits from the pilot plantations have been excluded because no significant planting activity took place there. Costs and benefits have been estimated in 1991 terms, net of taxes. As in the appraisal report, wages and salaries of the skilled workers in the Lama plantation are based on the pay scale of the ONAB. Unskilled labor has been costed at prevailing rates in the Lama region, which is the same assumption made at appraisal. Unlike in the appraisal report, no opportunity cost has been estimated for the Lama plant,tion since permanent laborers are former illegal settlers who had no alternative occupatis,ii. In addition, the project has spent money to provide them with basic infrastructure, new plots of land, extension and social services such as schools and infirmaries. Many of these benefits are unquantifiable and can be considered to largely compensate any opportunity cost. The values of poles and woods have been estimated as shown in Table 6.6 compared with CFAF 10.8 million annually for PYl -PYl 5. - 33 - The economic value of standing timber is based on the production table proposal shown in table 6.1 and is derived from the weighted average export parity (border) price of teak or similar sawnwood. Intermediate costs are deducted from these values obtained as shown in table 6.5. The appraisal report had used the import parity price as the reference. The resulting values of standing steak saw logs are estimated per cubic meter at CFAF 38,786 and held constant throughout (about US$ 134 compared with LIS$ 86 at appraisal for 2nd to 4th thinnings, US$ 122 for 5th thinnings and US$ 203 for trees failed at maturity). The economic prices of timber products from salvage logging has beern estimated at roadside value at CFAF 250 (US$ 0.86) and 400 (US$ 1.38) per pole for small and big poles respectively compared with US$ 55 and US$ 144 per cubic meter at appraisal. The available data did not make it possible to convert the pole numbers on a per volume basis. Based on the above assumptions, the economic rate of return of the project at PCR time has been estimated at 14.3%. However, if no further external assistance is brought to the project, revenues may drop sharply and consequently reduce the rate of return. D. Studies No studies were carried out or financed under the project. - 34 - TABLE 6.1 A. Elements of Production Table Age:yearo Density Average Stand Thinning %Trees Total M.A.I.(1) trees/ha Height Volume Volume Thinning Product. m3/ha/yr meters m3/ha m3/ha 1 1250.0 4 1250.0 11.0 60.9 30.0 60.9 15.2 4 875.0 11.0 42.6 18.3 60.9 15.2 8 875.0 15.0 109.8 45.0 128.1 16.0 8 481.3 15.0 63.9 49.4 113.4 14.2 12 481.3 19.0 135.5 203.2 16.9 12 381.3 19.0 107.3 28.2 20.8 16 381.3 22.0 200.0 296.1 18.5 16 281.3 22.0 129.0 71.2 35.6 20 181.3 25.0 144.7 311.8 15.6 20 140.0 25.0 112.8 31.9 22.1 24 140.0 28.0 184.5 383.5 16.0 30 140.0 30.0 261.1 460.1 15.3 40 140.0 33.0 314.5 513.5 12.8 (1) Mean Annual Increment TABLE 6.2 B. Production Parameters Area Pole Pole Wood Wood Wood Wood Age: year.Planted Product. Product. Product. Product. Product. Product. (ha) (lot Th) (2nd Th) (3rd Th) (4th Th) (5th Th) (Final) (m3) (m3) (m3) (m3) 1 200 2 600 3 820 4 740 75,000 5 843 225,000 6 307,500 7 277,500 8 316,125 78,750 9 236,250 10 322,875 11 291,375 12 331,931 5,631 13 16,894 14 23,088 15 20,835 16 23,736 14,238 17 42,713 18 58,375 19 52,680 20 60,012 6,388 21 19,165 22 26,192 23 23,636 24 26,926 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 62,902 1C8,707 257,899 232,738 265,133 - 36 - TABLE 6.3 C. Production Summary Pole Polo Wood Production Production Production (lst Th) (2nd Th) (m3) Age: years 1 2 4 75,000 5 225,000 6 307,500 7 277,500 8 316,125 78,750 9 236,250 10 322,875 1, 291,375 12 331,931 5,631 13 16,894 14 23,088 15 20,835 16 37,973 17 42,713 18 58,375 19 52,680 20 66,400 21 19,165 22 26,192 23 23,636 24 26,926 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 62,902 41 188,707 42 257,899 43 232,738 44 265,133 - 37 - TABLE 6,4 D. Costs Elements Year 6 Year 7 Yr 8 and after Road Maintenance Km 68.2 68.2 68.2 Cost/km 250,000.0 250,000.0 250,000.0 Coat/year (CFAF'000) 17,050.0 17,050.0 17,050.0 Plantation Maintained (ha) lot Year maintenance 843.0 0.0 2nd Year maintenance 740.0 843.0 Regular Maintenance 1,620.0 2,360.0 3,203.0 Cost/ha (CFAF/ha) lst Year maintenance 53,000.0 0.0 0.0 2nd Year maintenance 42,000.0 42,000.0 0.0 Regular mintenance 13,000.0 13,000.0 13,000.0 Total Plantation maint. 96,819.0 66,086.0 41,639.0 (CFAF'000) GRAND TOTAL 113,869.0 83,136.0 38,689.0 - 3F - TABLE 6.5 E. Economic Values Small Large Saw Logs Poles Poles m3 FOB Cotonou (sawn) 95,000.0 Intermediate Costs (1) 56,214.0 Net Value 38,786.0 Yield 0.6 Net Value 23,271.0 Roadside Economic Value 250 400 23,271.0 (1) Based on ONAB's experience - 39 - TABLE 6.6 F. ECONOMIC ANALYSIS ..-Revenues- Invest. Operatg. Total S_I. Large Total Total Age:years Costs Costs Costs PoLes PoLes Poles Wood Revenues Net Flow 1 304,574 304,574 0 -304,57- 2 305,185 305,185 0 -305,185 3 258,407 258,407 0 -258,407 4 596,678 596,678 18,750 18,750 37,500 -559,178 5 418,207 418,207 56,250 56,250 112,500 -305,707 6 113,869 113,869 76,875 76,875 153,750 39,881 7 83,136 83,136 69,375 69,375 138 750 55,614 8 58,689 58,689 79,031 31,500 110,531 221,063 162,374 9 58,689 58,689 94,500 94,500 189,000 130,311 10 58,689 S. 689 129,150 129,150 258,300 199,611 11 58,689 58,689 116,550 116,550 233,100 174,411 12 58,689 58,689 132,773 132,773 131,046 396,591 337,902 13 58,689 58,689 393,137 393,137 334,448 14 58,689 58,689 537,287 537,287 478,598 15 58,689 58,689 484,869 484,869 426,180 16 58,689 58,689 883,688 883, 688 824,999 17 58,689 58,689 993,99 993,990 935,301 18 58,689 58,689 1,358,453 1,358,453 1,299,764 19 58,689 58,689 1,225,921 1,225,921 1,167,232 20 58,689 58,689 1,545,219 1,545,219 1,486,530 21 58,689 58,689 445,987 445,987 387,298 22 58,689 58,689 609,515 609,515 550,826 23 58,689 58,689 550,050 550,050 491,361 24 58,689 58,689 626,611 626,611 567,922 25 58,689 58,689 0 .58,689 26 58,689 58,6a9 0 -58,689 27 58,689 58,689 0 -58,689 28 58,689 58,689 0 -58,689 29 58,689 58,689 0 -58,689 30 58,689 58,689 0 -58,689 31 s5,689 58,689 0 -58,689 32 58,689 58,689 0 -58,689 33 58,689 58,689 0 -58,689 34 58,689 58,689 0 -58,689 35 58,689 58,689 0 -58,689 36 58,689 58,689 0 -58,689 37 58,689 5&,689 0 -58,689 38 58,689 58,689 0 -58,689 39 58,689 58,689 o -58,689 40 58,689 58,689 1,463,8,6 1,463,816 1,405,127 41 4,391,449 4,391,449 4,391,449 42 6,001,646 6,001,646 6,001,646 43 5,416,120 5,416,120 5,416,120 44 6,169,935 6,169,985 6,169,985 45 Economic Rate of return Space 14.3% _ 40 - 7. STATUS OF COVENANTS Development Credit Agreement Brief Description Section or Special Compliance Comments Agreement Section Open special A&B accounts in CAA 2.02 (cl yes Open Project Advance Account (PAA) 3.01 (b) yes in CAA Make initial deposit of CFA 32 3.01 (b) yes millions in PAA Replenish PAA every 4 months 3.01 (b) yes L3ter on Government had problems with this covenant Establish Advisory/Policy Unit within 3.02 (a) yes DEFC I Employ forest specialist and financial 3.02 (b) yes controller within DEFC l Provide Advisory/Policy Unit with 3.02 (c) yes But financial funds & facilities as appropriate problems experienced by Government later on Employ consultants acceptable to IDA 3.03 yes selected following IDA's guidelines Enter into agreement with ONAB 3.04 yes __- ONAB to prepare initial and 3.04 (a) yr.s For first year, not subsequent annual work plans done thereafter ONAB to implement plantation 3.04 (b) yes component l ONAB to follow prescribed 3.04 (c) yes procurement guidelines . ONAB to modify its accounting 3.04 (d) yes done with delay system before december 31, 1984 _ ONAB to submit quarterly reports to 3.04 (e) done reports prepared but DEFC not always submitted _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ ___ _to DEFC ONAB to be remunerated with 3.04 (f) revenues from salvage logging DEFC and DRA to enter into research 3.05 done with protocol delay Goods to be insured 3.06 (a) done Goods and services financed from the 3.06 (b) done credits to be used exclusively for project _ Borrower to furnish IDA with (a) 3.07 (a) not done project monitoring plan (b) monitoring plan for financial 3.07 (b) not done operations (c) Annual work programs and 3.07 (c) done but not budgets for plantation submitted Borrower to furnish plans, 3.08 (a) done specifications, reports, contract documents and procurement schedules Borrower to maintain records and 3.08 (b) (i) substantially procedures to record and monitor done project progress Borrower to enable IDA's 3.08 (b) (ii) done representatives to visit project facilities and examine records Borrower to furnish periodic reports 3.08 (b) (iii) substantially on project done Borrower to prepare Completion 3.08 (c) done with a delay of 2 Report less than 6 months after months, without closing economic or financial analysis Borrower to secure rights for land 3.09 done necessary for the project Borrower to maintain proper 4.01 (a) basically accounting records done Borrower to maintain separate 4.01 (b) done accounts for the Development and the & 4.01 (c) Spacial Fund Credit agreements and retain records until one year after closing date - 42 - 8. Use of Bank Resources A. Staff Inouts (Staffweeks) TO TASK FY82 FY83 FY84 FY85 FY86 FY87 FY88 FY89 FY90 FY91 FY92 TOTAL Preparation -- 24.4 -- -- -- -- 24.4 AppraisaL 24.1 10.2 -- - -- -- - * - 34.3 Negotiations/Board -- -- 3.8 -- - - 3.8 Loan Processing (LOP) 0.5 5.2 -- -- - -- -- 5.7 ...... .... .. .... .... . .... .... . .... .... . .... .... .. .... .. ..... .... Sub-total 0.0 49.0 19.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 68.2 Supervision -- -- 6.6 4.2 3.8 4.3 8.6 10.5 7.2 -- 45.2 Project Adcinistration (PAD) -- -- -- 0.5 1.0 - -- -- - . -. 1.5 Project Completion Report -- -- -- - - -- -- -- -- -- 6.6 0.0 ,... . ...... .. . . .. . .... ..... .... ..... .... ..... ---- ---- .... ............ Sub-total 0.0 0.0 0.0 7.1 5.2 3.8 4.3 8.6 10.5 7.2 0.0 46.7 TOTAL 0.0 49.0 19.2 7.1 5.2 3.8 4.3 8.6' 10.5 7.2 0.0 114.9 S = ===Z xzz2 5-=S z=ui *- 3S *S# 3 =23 S--- 3:3 Munoz February 10, 1992 - 43 3 8. USE OF BANK RESOURCES B. Missions (Staff and consultants) Date Number of Days in field Specialization Performance Problems ________________ persons represented rating (a) listed (b) (i) Appraisal 3/198 3 22 1 forester 2 economists (ii) Supervision _ 1. 9/'84 1 (c) 2.5 economist 1,2 none 2. 5/'85 2 (c) 4 economist 2,1 M 3. 5/'86 1 (c) 4 agronomist 2 M,DI economist 4. 1 1 P86 1(c) 6 agriculturalist 2 M1DI 5. 5/'87 1 4 agriculturalist 2 M,DI 6. 1 1/'87 2 (c) 5 agriculturalist 2 M,DI forester (d) __l 7. 7/'88 2 (c) 9 agriculturalist 2 M,DI financial analyst 8. 12/'89 2 10 agriculturalist 2 DI,F financial analyst 9. 1 2/'90 2 4 agriculturalist 1 Dl financial _______________ analyst (a) Until May 1985, first number represented overall rating, second number represented status (trend) rating as follows: 1 = no significant problems; 2 = moderata prblems, 3 =major problems which are being addressed adequately; and 4=major problems not being addressed adequately. The status code stopped in new Form 590 with the May 1986 report. Status code was as follows: 1 =improving; 2=stationary; and 3=deteriorating. (b) The types of problems shown are: M=Managerial; F=Financial; T=Technical; P=Political. Di= Development Impact. (c) Mission also had representative of co-financing agency in addition to persons listed above. (d) The forester was a consultant. - 44 - ANNEX 1 DOCUMENTS CONSULTED 1. Project Briefs 2. Issues Papers 3. Pre-mission meeting papers 4. Back-to-office reports 5. Decision memorandum and remarks on decision memo 6. Correspondence between the Bank and the Government 7. Negotiations memorandum 8. Appraisal Report 9. Supervision reports 10. Special Fund Credit Agreement 11. Development Credit Agreement 12. President's Report 13. Technical Assistance Contracts 14. Bank missions Aide-Memoires 15. Bid Documents 16. Benin 1982 Forestry Sector Report 17. Review of GTZ Report on Benin Forestry Development 18. Review of UNDP/FAO Forestry Development Project 19. FY 90, ARIS-Performance of agricultural projects in Africa 20. Progress report in implementing FY 90 ARIS recommendations, AF1 Agriculture 21. ARIS FY90, Results for AFlAG 22. Annual Review of Evaluation results for 1990: Agriculture, Background Paper 23. Reports by the German Forestry Mission at ONAB 24. Lama Res3rve Quarterly Reports of the German Forestry Mission 25. Natural Resources Management Project: Yellow/Green Cover/Buff Cover 26. Forestry Project Audit Reports 27. Comparaison des differentes tables de production pour le teck (Tectona grandis), by H. Forster, Novembre 1991 Greman Forestry Mission in Benin 28. ONAB's annual reports (especially the 1990 one) 29. Other reports. _ 45 - ANN'EX 2 COMMENTS FROM COFINANCIER German Forestry Mission in Benin Deutsche Gesellschaft fu-r Technische Zusammenarbelt (GTZ) GmbH Project for the Development of Forestry and Wood in Benin Cotonou, 29.05.1992 World Bank Resident Mission, Benin Attention: Mr. Brizzi Sir: Thank you for the forwarding, by Mr. Grabener, of the Project Completion Report for the Forestry Development Project. With regard to the reforestation of the Luma, cofinanced by KfW, the results presented in the above-mentioned report are correct. Sincerely yours, German Forestry Mission Mission Chief (Illegible signature) -X "<-\, / ~~~~~ ~ ~ ~ N I G E R 2 , n MALI // ENIGER /RURKINAURKIN (MO ~ ~ FS .1 C-A~~~~CJWE \ Hi_J} t~NGERIA \ \l i DtlAe( C Gi 2 BURKINA \- < j1- 4 }0~~~~~ FALSO K X g o E ANVILL1 ATLANTrC OCEAN O- K+ otsro f ,e Sor.so, t /0 [0g0 ! * \,Dossor, If soon (- X~A T A C O R A 5S.o ww bl TANGUlJKIA B O eeor oe SoYj, A-ooor4o- K?o,o,eeLn1 ħ Koroeooo PI,ok\ebf / \ NATITINGO olsd ' 4 tne /( Dnos Kooo.eob. S/tos D~~~~~~~~ ........../~ t 0 ) tv / <<~~~~~~ ~~PAR U @- 080%|10 ) I i' ~~~~~~~~B E N I N 9 FORESTRY PROJECT Afric,n Deoplo-teos Book T O G O I _ _ _ > * Fuelwood Plonrtts- Pro,est } ~ ~~~~~~~~~~~~ BE iE HeodqoorrrŽrs0 Foress1 Reserve I 4 M /al ,? )? ? ~~~~~~~~Inmernorionol Boondorles rg D.; \?/ ew BroodlolS Foergeer 'orest - chet! \ to ot X D~~~~~~~~~~~~~~Eeriduoso Foroor hrF ond CoIrbiroed Vegororv < 4 y|DASSAiO