SCCD : N.G.

AFRICAN DEVELOPMENT FUND BUR/PAAR/2001/01 Language: English Original: French

APPRAISAL REPORT

DECENTRALISED AND PARTICIPATORY RURAL DEVELOPMENT PROJECT IN THE BAZEGA AND KADIOGO PROVINCES

BURKINA FASO

NB: This document contains errata or corrigenda (see Annexes)

COUNTRY DEPARTMENT OCDW WEST REGION FEBRUARY 2001

TABLE OF CONTENTS Pages

PROJECT BRIEF, ACRONYMS AND ABBREVIATIONS, ANALYTICAL SUMMARY, MATRIX i-ix 1. PROJECT GENISIS AND BACKGROUND 1 2. AGRICULTURAL SECTOR 2 2.1 Major Characteristics 2 2.2 Land Use System 3

2.3 Constraints, Perspectives and Opportunities 3 2.4 Rural Development Policy 3 2.5 Performances of Similar Projects 4

2.6 Other Donors’ Operations 5 2.7 Bank Group Strategy 5

3. THE SUB-SECTORS CONCERNED 5 3.1 Major Characteristics 5

3.2 Rural Sector Institutions 6 4. THE PROJECT 7 4.1 Project Design and Rationale 7 4.2 Project Zone and Beneficiaries 8 4.3 Strategic Context 12

4.4 Project Objectives 12 4.5 Project Description 12 4.6 Production, Markets and Prices 17 4.7 Impact on the Environment 19 4.8 Social Impact 20 4.9 Project Cost 21 4.10 Sources of Finance and Expenditure Schedule 22

5. PROJECT IMPLEMENTATION 24 5.1 Executing Agency 24 5.2 Institutional Provisions 25 5.3 Implementation and Supervision Schedule 27 5.4 Procurement Arrangements 27 5.5 Disbursement Arrangements 30 5.6 Monitoring and Evaluation 30 5.7 Financial and Audit Reports 31 5.8 Coordination with Other Donors 31 6. PROJECT SUSTAINABILITY AND RISKS 32 6.1 Recurrent Expenditure 32 6.2 Project Sustainability 32 6.3 Major Risks and Mitigating Measures 32 7. PROJECT BENEFITS 33

7.1 Financial Analysis 33 7.2 Economic Analysis 33 7.3 Social Impact Analysis 34 7.4 Sensitivity Analysis 34

8. CONCLUSIONS AND RECOMMENDATIONS 35 8.1 Conclusions 35 8.2 Recommendations 35 This report was prepared following a mission to Burkina Faso from 29 March to 19 April 2000 by Messrs M. DIKOMBE, Agro-economist, OCDW.4, Head of Mission, B. BOEDTS, Agronomist and G. TIBALDESCHI, Agronomist/Environmentalist. Inquiries should be forwarded to Mr. E. DOTE, acting Division Manager, OCDW.4 (Ext. 4542).

AFRICAN DEVELOPMENT FUND 01 B.P. 1387 ABIDJAN 01

Tél. : (+ 225) 20 20 44 44 PROJECT BRIEF

Date : February 2001 The information given hereunder is intended to provide some guidance to prospective suppliers, contractors, consultants and all other persons interested in the procurement of goods and services for projects approved by the Boards of Directors of the Bank Group. More detailed information and guidance should be obtained from the Executing Agency of the Borrower. 1. COUNTRY : BURKINA FASO 2. NAME OF PROJECT : DECENTRALISED AND PARTICIPATORY RURAL DEVELOPMENT PROJECT

IN THE BAZEGA AND KADIOGO PROVINCES

3. LOCATION : Provinces of Bazèga and Kadiogo

4. BORROWER : Burkina Faso 5. EXECUTING AGENCY : Project Management Unit in the Ministry of Agriculture : Tél : (226) 40 50 42 6. PROJECT DESCRIPTION

The major components of the project are :

A. improvement of systems of production B. natural resource development and management C. improvement of living conditions D. reinforcing local capacities E. Project management

7. PROCUREMENT OF GOODS AND SERVICES :

Goods, works and services financed by ADF will be procured in the following manner :

i) consultants, NGOs, auditing firms for project accounts will be recruited on the basis of a short list;

ii) contract for the supply of pumps, motors and accessories will be based on international competitive bidding;

iii) procurement of civil engineering works related to the construction of water infrastructure, development of 30 km of rural tracks and an irrigation scheme will be carried out according to international competitive bidding procedures ;

iv) work regarding forest and pastoral management will be carried out on force account by the project with the support of the Ministry of the Environment and Water ;

v) contracts for supplies, equipment, furnishings and other materials will be on the basis of prudent shopping at the national level ;

vi) vehicle contracts that do not exceed UA 200,000 will be based on national bidding ; vii) contracts for small equipment and supplies envisaged within the framework of

operation of the Project Management Unit; whose contract amounts do not exceed UA 20,000 will be negotiated with suppliers on the national level;

viii) management training of project officers will be entrusted to AMTA;

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ix) for the rural credit fund, goods, services and works will be procured in compliance with trade practices deemed acceptable by the Fund;

x) for the local investment fund, goods, services and works will be procured in compliance with procedures defined in the manual of procedures;

xi) implementation studies, studies on water tariffs and the maintenance of water points, control and supervision of water infrastructure works will be carried out by the Water Department of the Ministry of the Environment and Water ;

xii) implementation of the livestock component will be carried out on force account by the Ministry of Livestock Resources;

xiii) implementation of the agricultural component will be carried out on force account by the Ministry of Agriculture ;

xiv) research works on the identification of technical itineraries, animal health, improvement of soil fertility, agricultural/forestry, agriculture-stockbreeding will be carried out by research institutes under the co-ordination of the National Scientific Research and Technological Centre (CNRST).

8. TOTAL COST : UA 20.24 million. - Foreign Exchange : UA 10.42 million

- Local Currency : UA 9.82 million

9. ADF LOAN : UA 15.00 million

10. OTHER SOURCES OF FIINANCE - Beneficiary : UA 1.90 million

- Government : UA 3.34 million

11. DATE OF APPROVAL : APRIL 2001

12. PROBABLE DATE OF PROJECT START-UP AND DURATION : JULY 2001, 6 years

13. REQUIRED CONSULTANCY SERVICES REQUIS : Consultants for training, literacy, post literacy,

implementation of an accounting system and extension services.

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CURRENCY EQUIVALENTS

UA 1 = CFA F 968.350 (December 2000) UA 1 = US $1.28197 US $1 = CFA F 755.361 WEIGHTS AND MEASURES Metric System FISCAL YEAR 1 January - 31 December

LIST OF DES ANNEXS No. DESCRIPTION 1. Map 2. Project Organization Chart 3. Project Implementation Schedule 4. List of goods and services 5. Provisional Operating Accounts 6. Economic Analysis (Rates of return) 7. Institutions participating in the Project 8. Bank Group Operations in Burkina Faso ACRONYMS AND ABBREVIATIONS AFI Rural Financial Institutions BUNASOLS National Soils Agency CCTP Provincial Technical Consultation Framework CIDR Centre international de développement et de recherche (International Development and Research Centre) CIPEI Centre international de physiologie et d’écologie des insectes

(International Insect Physiology and Ecology Centre) CIRAF Centre international pour la recherche agro-forestière (International Centre for Agro-Forestry Research) CIVGT Comité inter-villageois de gestion des terroirs (Inter-village Land Management Committee) CNRST Centre national de recherche scientifique et technologique (National Centre for Scientific and Technological Reserarch) CONAGESE Conseil national pour la gestion de l’environnement (National Council for Environmental Management) CSPS Centre de santé et de promotion sociale (Health and Social Welfare Centre) CVECA Caisse villageoise d’épargne et de crédit autogéré (Village Savings Bank and Self-Administered Credit) CVGT Comité villageois de gestion des terroirs (Village Land Management Committee) DPRA Direction provinciale des ressources animales (Provincial Directorate of Livestock Resources) FAARE Fonds d’appui aux activités économiques des femmes (Women’s Economic Activity Support Fund) FENU Fonds des Nations Unies pour l’équipement (United Nations Capital Development Fund)

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ACRONYMS AND ABBREVIATIONS (cont’d)

ICB International Competitive Bidding IFDC-AFRIQUE International Fertilizer Development Center Africa ILRI International Livestock Research Institute INERA Institut de l'environnement et de la recherche agricole (Environment and Agricultural Research Institute) LIF Local Investment Fund MA Ministry of Agriculture MRA Ministry of Livestock Resources NCB National Competitive Bidding NGO Non Governmental Organisation NS National Shopping OPA Organisation professionnelle agricole

(Professional Agricultural Organisation) PDRDP Projet de développement rural décentralisé et participatif dans les provinces du

Bazéga et de Kadiogo (Decentralised and Participatory Rural Development Project for the Provinces of Bazéga and Kadiogo)

SPEEF Service provincial de l'environnement des eaux et des forêts (Provincial Water and Forestry Environment Department) SSC Specialised Sub-Committee UEMOA Union économique et monétaire ouest africaine (West African Economic and Monetary Union) UGFS Unité de gestion de la fertilité des sols (Soil Fertility Management Unit) VIH/SIDA Human Immuno-deficiency Virus/Acquired Immuno-Deficiency Syndrome

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ANALYTIC SUMMARY 1. PROJECT BACKGROUND The Decentralised and Participatory Rural Development Project in the Bazéga and Kadiogo Provinces (PDRDP) is part of the National Land Management Programme (PNGT). It follows the Natural Resources Management Project (PGRN) financed in 1993 by the ADF and implemented from February 1995 to September 2000. On the whole, the actions envisaged within the framework of PGRN were carried out. In view of the need to improve living conditions for the populations of the Bazéga and Kadiogo provinces, the authorities expressed the willingness to pursue PGRN’s actions. In the context of this Project, the Governmet has adopted the new policy. The strategy selected promotes local grass-roots development. In response to the Government’s requests two missions were sent to Burkina Faso by the Bank in March-April 2000 to evaluate the PDRDP and in December 2000 to reformulate this Project. 2. BANK GROUP LOAN The UA 15 million ADF loan will fund 100% of the foreign exchange costs and part of the local currency costs accounting for 19.9% of the total project cost. 3. PROJECT OBJECTIVES The Project’s sectoral goal is to contribute to poverty reduction. Specifically, the aim of the project is to strengthen food security, rational human resources management, development of agricultural and livestock production and increase the income of inhabitants of the project zone. 4. PROJECT IMPLEMENTATION

The project’s major achievements include : development of 29.250 ha. of rain-fed crops, development of 140 ha. of irrigated rice crops, 23 ha. of market gardening, 600 ha. of shallow waters and 1000 ha. of aboriculture, rehabilitation of 1920 ha. of old shallow lands, reclamation of 1000 ha. of clay, development of 3000 ha. of natural pastures, 200 km of cattle paths, 30 km of rural tracks and 100 km of forest paths; improvement of productivity, creation of a credit fund of UA 1.50 million for income-generating activities, construction of 2 multi-purpose reservoirs, development of new crocodile swamps, rehabilitation of 7 multi-purpose reservois, development of 1500 ha. of natural village forests, creation of individual forest plantations and 1500 ha. of fire-walls, creation of 23 bore-holes, rehabilitation of 15 bore-holes and 48 bung diametre wells, creation of an environmental observatory, construction of 8 schools with 3 classrooms each, construction of 3 health centres, establishment of a UA 1.5 million fund and a UA 0.27 million to support communal programme to combat STD and AIDS, establishment of a multi-disciplinary team. 5. PROJECT COSTS The total cost of the Project is estimated at CFAF 19599.40 million, that is to say UA 20.24 million net of taxes and customs duties. The cost is broken down as follows : CFAF 10090.21 million, that is to say UA 10,42 million in foreign exchange and CFAF 9509.19 million, or UA 9.82 million in local currency.

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6. SOURCES OF FINANCE The ADF, beneficiaries and the Government of Burkina Faso will finance the loan. The ADF will cover 74.11 % of the total cost of the Project, that is to say UA 15 million , therefore 100 % of the foreign exchange costs. The ADF will bear the local currency costs which account for 22.63 % of the Project’s total cost. ADF operations will finance the total cost of equipment, services and operations. It will also permit a part of the cost of works, credit, training and staff to be financed. Beneficiaries’ contribution amounts to UA 1.90 million and that of the Government amounts to UA 3.34 million , or 16.50 % of the Project’s total cost. It will finance a part of the local currency expenditures related to all the categories of implementation, equipment, FIL and rural credit. 7. PROJECT IMPLEMENTATION

The Project Management Unit will be the project executing agency. This unit is supervised by the General Secretariat of the Ministry of Agriculture, based in Kombrissiri. The Project unit will be supported by two branches, one based in Kombissiri (BAZEGA Province) in facilities set up during the first phase of the project and the other in SAABA (KADIOGO Province). The Project Management Unit will be headed by a Coordinator and will be responsible for the co-ordination, control and monitoring of all Project activities, preparation of Project action programmes, budgets, tender documents and disbursement requests to be forwarded to the ADF and preparation of financial statements, monthly project implementation reports. It will use specialised agencies to implement the project components. At the regional and national level, project co-ordination will be ensured by the provincial co-ordination committee and the national co-ordination committee. 8. CONCLUSION AND RECOMMENDATIONS

The increase in production following project implementation will contribute to reducing poverty prevailing in the project zone and to strengthening food security. In addition, the project will have a positive impact by increasing per capita income and purchasing power. This situation will bring about significant changes in the household expenditure structure. Project implementation will also promote the creation of new permanent and temporary jobs, which will limit the migration of youths to urban centres. It will enhance women’s development and their integration into economic circuits. The project’s framework is consistent since its activities aim at local development, on the one hand, and natural resources protection and development, on the other. As designed, it is technically feasible, financially and economically viable. The economic rate of return stands at 24.76%; In view of the foregoing, it is recommended that Burkina Faso be allocated a loan not exceeding UA 15 million on ADF resources. However, the loan shall be subject to a number of conditions.

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PROJECT MATRIX

Project Title : BURKINA FASO : Decentralised and Participatory Rural Development Project in the Bazéga and Kadiogo Provinces Design Team : M. DIKOMBE, B. BOEDTS et TIBALDESCHI Design Date : 08/02/00

NARRATIVE SUMMARY OBJECTIVELY VERIFIABLE INDICATORS (OVI) MEANS OF VERIFICATION IMPORTANT ASSUMPTIONS

1. Sectoral Goal 1.1 Reduce the poverty of target populations.

1.1 The number of rural households below the poverty line in the project zone reduced from 30% in 2001.to 10% in 2010.

1.1 National statistics reports and household surveys.

2. Project Objectives 2.1 Reinforce food security. 2.2 Increase production . 2.3 Increase income of people in Bazéga and

Kadiogo provinces.

2.1 Daily adult caloric intake stands at 3 500 in 2010. 2.2 Agro-sylvo pastoral production increases by 40 000

tonnes for traditional cereals, 20 000 tonnes for cereals, 4 million litres for milk and 6 550 kg for meat. 2/3 are achieved in 2004.

2.3 Livestock income increases by 3% in 2010.

2.1 Annual statistics report and household survey . 2.2 Half yearly reports, project completion

reports and national statistics reports. 2.3 Idem

2.4 Continuous demographic pressure

and normal rainfall.

3. Project Implementation 3.1 Combat desertification 3.2 Develop ranches 3.3 Develop water infrastructure. 3.4 Develop irrigation schemes.

3.1 By 2007, 1500 ha. of village natural forests have been

developed ; half is developed by 2004. 3.2 By 2006, 3000 ha. of natural grazing lands andt 200 ha. of

cattle paths have been developed. Half has been developed by 2004.

3.3 By 2006, 2 reservoirs, a pond and 23 bore-holes will

have been developed and 7 reservoirs, 13 bore-holes and 48 wells will have been rehabilitated.

3.4 By 2006, 140 ha. Under irrigation will have been

developed .

3.1 Project activity report half yearly and yearly reports, ADF supervision reports, follow-up and evaluation reports (internal and external) 3.2 idem 3.3 idem 3.4 idem 3.5 idem

3.1 Agro sylvo pastoral potential

improved thanks to availability of water.

3.2 Livestock farmers adequately

sensitized to the needs of improved species.

3.4 Users follow prophylactic and

health measures.

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NARRATIVE SUMMARY OBJECTIVELY VERIFIABLE INDICATORS (OVI) MEANS OF VERIFICATION IMPORTANT ASSUMPTIONS 3.5 Develop and rehabilitate low-lands. 3.6 Maintain and restore soil fertility 3.7 Eolien erosion and water pollution control. 3.8 Support community and income-generating

activities. 3.9 Improve productivity. 3.10 Improve living conditions. 3.11 Initiate a local development process. 3.12 Strengthen local capacities.

3.5 By 2004, 600 Ha. of low-lands will have been developed

and 1920 ha. of old low-lands rehabilitated. 3.6 By 2007, 1000 Ha. of clay will have been recuperated and

the fertility improved. 3.7 By 2004, water opollution has been reduced by

application of public healthprophylaxis as well as special measures for maternal and infant health in the project zone.

3.8 By 2009, a FIL of UA 1.50 million and a rural credit

fund of UA 1.50 million have been put in place. 3.9 By 2003, output has reached 1000 kg/ha. for millet ;

1300 kg/ha. for sorgum ; 1600 kg/ha. for maize : 3500 kg/ha. for rice paddy ; 1200 kg/ha. for groundnuts ; 1480 kg/ha. for cotton and 14 litres of milk per cow per day.

3.10 By 2004, 8 classes and 3 health centres will have been

built ; half constructed by 2004. 3.11 By 2002 a multi-disciplinary team will have been set up. 3.12 By 2007, the populations will have been trained,

including a third by 2003..

3.6 idem 3.7 idem 3.8. idem 3.9 Idem 3.10 Idem 3.11 Idem 3.12 Idem

3.8 Beneficiaries repay loans.

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NARRATIVE SUMMARY OBJECTIVELY VERIFIABLE INDICATORS (OVI) MEANS OF VERIFICATION IMPORTANT ASSUMPTIONS 4. Project Activities 4.1 Natural resources development and

management : - Rural water supply - Development village native forests.

4.2 Improvement of the production systems. 4.3 Strengthening local capacities. 4.4 Support for community and rural credit

activities. 4.5 Project coordination and management.

Ressources financières • Component A : UA 3.28 million • Component B : UA 6.91 million • Component C : UA 3.40 million • Component D : UA 2.30 million • Component E : UA 4.38 million

4.1 Activity and supervision reports,

contracts, protocols of agreement signed by the Borrower and specialized agencies, project list of goods and services.

4.2 Idem 4.3 Idem 4.4 Idem 4.5 Idem

4.1.1 The regulations on genetic

improvement applied in the field. 4.1.2 Beneficiaries maintain livestock

infrastructure. 4.2. Water points management

committees charge new rates adapted to actual borehole maintenance costs.

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1. PROJECT GENISIS AND BACKGROUND 1.1 Burkina Faso is a developing country whose economy is based mainly on agriculture and livestock. Aware of that reality, the authorities undertook a series of structural and agricultural sector reforms with a view to restoring the bases of sustainable economic growth, improving the people’s living conditions and developing sustainable agriculture. The authorities made considerable progress. Indeed, GDP increased in real terms on an averaged of 5% between 1995 and 1999 and public finances were reorganized. Despite that progress, economic foundations remain weak; the economy is barely competitive and depends on external resources. Population’s living conditions have not improved significantly. Poverty has increased and natural resources continue to deteriorate. Furthermore, agriculture is practiced under harsh climatic and ecological conditions. It is dependent on an extensive farming system. 1.2 It is in this context that the authoritiers of Burkina Faso requested and obtained donors’ support to finance the National Land Management Programme (PNGT) including the Bazéga Natural Resources Management Project financed by the ADF in 1994. The PNGT is a rural development programme based on local development approaches and land management whose driving forces are the participatory approach and decentralisation. The basic objective is poverty reduction and reinforcement of food security. It covers all of Burkina Faso, and is in its second phase. The PGRN which pursues the same objectives as the PNGT concerned all of the Bazéga province and 4 of the 6 departments of the Kadiogo province. It was successfully carried out for four years and was included in a Project Completion Report (PCR). The project objectives were achieved because agricultural production increased. Considerable improvements were made as regards producers’ income. From the operational standpoint, the activities envisaged within the framework of the Project have been carried out, in particular the rehabilitation of water infrastructure, desertiffication and soil erosion control, construction of public facilities, soil protection and restoration and area development roads. 1.3 Despite such positive performances, the PGRN suffered the following inadequacies; 80 villages out of 323 were supervised (the average size of a village varies between 50 and 85 households); the little sensitization, extension work and supervision of producers, the inadequacy of organisation and running of farmers’ associations, inadequate preparation of producers for effectively assuming responsibility for actions after the Project and the failure to take into consideration the « Gender and Development » approach in Project operation strategy. 1.4 The major lesson learned from this experience with PGRN is that if the imbalances observed in the Bazéga and Kadiogo provinces are not corrected rapidly, the ecological and socio-economic environment will deteriorate considerably and the disparities between villages will increase. With a view to bringing local communities to take responsibility for the development of Bazéga and Kadiogo,it is urgent to act within the framework of the second National Land Management Programme in order to consolidate the attainments of the PGRN, rationally manage natural resources, reinforce rural communities local capacities and set up the planning process. It is in this context that the authorities of Burkina Faso envisaged, with donors’ consent, to support the PNGT by implementing the decentralised and participatory rural development. Project in the provinces of Bazéga and Kadiogo (PDRDP). In this regard, the appraisal mission for this project visited Burkina Faso in March-April 2000. It was followed by a review mission carried out in December 2000. The aim of this

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second mission was to better exploit the local development approach, on the one hand, and on the other hand take into account observations formulated by some members of the Board of Administration on this approach adopted for the Project. In fact, the local development approach promotes, as management instrument, the participation of rural and local communities in decision making and administrative decentralisation. This mission permitted the positions of different donors to be reconciled with regard to the rural development approach based on local development in Burkina Faso, recommended by the Government and supported by all the donors. This appraisal report is the result of consultations organised with the people, the authorities, NGOs and donors during the two missions. Details related to this report are included in volume 2 which is an integral part of this report. 2. AGRICULTURAL SECTOR 2.1 Major Characteristics 2.1.1 Agriculture is the leading force of Burkina Faso’s economy. It accounts for an average of 40% of the GDP (25% agriculture, 12% stockbreeding and 3% forestry and fisheries) and ensure work and an income for 80% of the population. The population is young. Despite considerable economic progress the people are still very poor. The poor account for 45.3% of the total population. Estimates put the population living below the poverty line at 27.8%. In terms of calories, the poverty line is set at 2 430 kcal/pers./day. In financial terms, the poverty line is estimated at CFAF 72 690 per adult, yearly. The overall poverty rate stands at 16%. However, although it has fallen only slightly by about 0.5%, rural poverty is put at nearly 51%. Rural poverty affects the farmers of food crops and large households . This poverty is due mainly to: an uncompetitive economy which does not permit income to be generated or jobs created. This situation is aggravated by malnutrition, the persistence of STD and AIDS whose adult prevalence rate is 6.44% and insufficient potable water. As regards Burkina Faso’s women, they remain victims of prejudice and obsolete practices and are still inadequately involved in national public life. 2.1.2 Most farms are family operations averaging 3 to 6 ha. Involved mainly in cereal production (millet, sorghum, maize, rice and fonio). Despite its growing importance, livestock farming continues to use the extensive method. However, irregular and low rainfall, combined with the naturally poor soil, constitute the key constraints to agricultural and livestock development. The situation is worsened by high population pressure, migration, accelerated environmental deterioration as a result of abandoning the practice of land fallowing and uncontrolled felling of trees, overgrazing, inadequate water supply and deterioration of ranges. Forest formations account for nearly 17 million ha., all of which are seriously deteriorated. The deterioration is due to: (i) uncontrolled clearing of tree formations and shortening of the fallowing period; (ii) shortage of fire wood; and (iii) overgrazing and range deterioration. These constraints notwithstanding, Burkina Faso has significant agricultural potential (only one-third of the 9 million ha. of arable land is farmed). Twelve per cent (12%) of the irrigable land potential, estimated at 165 5000 ha. is developed. The country also has considerable surface and ground water potential (10 billion m3 and 113 billon m3 respectively). 2.2 Land Use System

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The 1984 Agrarian and Land Reorganization Edict (loi portant sur la reorganisation agraire et fonciere, RAF), modified in 1994 and 1996, regulates access to land in Burkina Faso. The edict is hardly known and rarely applied in rural areas where customary regulations govern with regard to land. Communities obey traditional customs, considering land to belong to families. Therefore, the quest by farmers and livestock farmers for farmland, grazing land and water generates problems sometimes beyond the capacity of the traditional system. The core problem resides in the inadequacy of infrastructure for negotiations between various actors. The people’s settlement of these differences through organized negotiations has proven effective. That approach is retained within the context of implementation of development projects. 2.3 Constraints, Perspectives and Oportunities 2.3.1 The key constraints that the rural deevelopment sector faces are : insufficient and irregular rainfall ; (ii) inadequate water control; (iii) natural resources deterioration and a decline in soil fertility; (iv) predominace of extensive agriculture with a low farm intensification rate ; (v) strong population pressure on agricultural land; (vi) land insecurity related to the sustainability of the traditional land use systems and agrarian and land reform ill-adapted to current realities; (vii) the inadequate organization of farmers which limits their operating and negotiating ability ; (viii) exodus that robs the rural area of its vital force; (ix) the low level of rural income and difficult access to bank financing; (x) the inadequate processing of agricultural products; (xi) enclavement and high internal and external transport costs; (xii) socio-cultural handicaps that tend to marginalize youths in general and women in particular, within rural society. 2.3.2 Despite these many constraints, there are potentials and assets on which the foundation of accelerated rural sector growth can be laid, in particular: the availability of farm and irrigable land, existence of surface and ground water, biological diversity and strong determination on the part of rural communities and the Government, supported by Donors, to establish basic development. 2.4 Rural Development Policy 2.4.1 The rural development policies applied by the Government have shown their limit. Indeed, with the aid of development partners, the Government prepared a new rural development policy formalized in the Decentralised Rural Development Statement on the sector policies and strategy that were prepared, especially the Scientific Research Strategy Plan, the Action Plan Orientation Brief for Burkina Faso’s Livestock Development Policy, the Livestock and Agricultural Sectors Strategy of Orientation Paper to the year 2010, the National Desertification Control Plan of Action, the Agricultural Sector Sustainable Growth Operational Strategy Plan, the different approaches regarding land management and the locally based development approach. 2.4.2 The major objectives of the new rural development policy are to : develop agricultural production from 5 to 10% per year, contribute to the increase of farmers and and stockbreeders income by at least 3% per person and per year, create conditions conducive to the populations’ availabily and accessibility to sufficient and balanced food supply, ensure adequate health coverage for all the country’s health regions, reduce sero-prevalence of HIV/AIDS in Burkina Faso, attain a crude enrollment rate of 70% while reducing the disparities between boys and girls and raising the literacy rate to about 50% and reinforce potable water coverage by creating modern water points.

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2.4.3 To attain the abovementioned objectives, the following envisaged actions are based on the following strategic axes : developing market economy in rural ares, sustainable natural resources management, food and nutritional security, improvement of the economic status of woman in rural areas, refocusing the State’s role and promoting private inititive, a system of cofinancing of activities between public authorities and local communities, administrative decentralisation, making local communities accountable, construction of infrastructure and close participation of populations in their management. 2.5 Performance of Similar Projects 2.5.1 The Bank Group has financed other rural development projects in Burkina Faso, in particular:

i) The Comoe Integrated Rural Development Project: completed on 31 January 2000, the project aimed at reducing poverty and reinforcing food security by: (a) intensifying in-fed farming; (b) developing animal-drawn farming; (c) strengthening the supervisory and extension mechanism; (d) improving road and social infrastructure. The project started late owing to delays in fulfilling the conditions for entry into force of the loan. It also faced difficulties following frequent changes of managers. Those problems notwithstanding, considerable progress was made. The project built 93 km of feeder roads, water infrastructure and boosted cereal production.

ii) The Piela-Bilanga Rural Development Project: aims at reducing poverty and

reinforcing food security; improving their income, modernising potable water supply production systems, protecting the environment and providing access to the project zone. The project started in December 1994, two years behind schedule. In general, scheduled project actions were implemented. However, the Bilanga-Poutenga road and 101 boreholes remain to be constructed and development of 30 ha.

iii) Soum Province Livestock Development Project which is in its second phase. The purpose of the project is to reduce poverty and reinforce food security by increasing milk and meat production, develop fodder crops and improve fallowing in order to increase the quantity and the quality of biomass, encourage people to form groups in order to benefit from certain services, especially credit, train livestock farmers in corresponding technics and support basic initiatives with the help of technical advice. The project was delayed due to the fulfillment of the conditions for loan effectiveness approved on 29 March 2000.

2.5.2 The projects’ performances improved thanks to measures taken to manage working capital, disbursements, government supervision and follow-up. Staff training contributed substantially to enhancing the efficiency of executing agencies, financial management and coordination of project activities. These projects are also rich in lessons. Regular project supervision, the adoption of a single accounting system and follow-up/evaluation performance indicators could further improve project efficiency. 2.6 Other Donors’ Operations

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2.6.1 Burkina Faso received assistance from several donors and NGOs to finance projects in the agricultural sector, including the most important ones which are: Livestock Sector Support Programme funded by the the European Union; the Gourma Animal Resources Development Project financed by the Arab Bank for Economic Development in Africa (ABEDA) ; the Nouhao Valley Development Project, funded by Italy, the Village Animal Development Programme financed by France, the Burkina Sahel Programme Support Project, financed by UNDP and FENU and installed in Burkina’s 4 provinces of Sahel Burkina, the Burkina Sahel Programme funded by the Kingdom of the Netherlands, the Natural Resources Management Project in Séno and Yagba, financed by the Kingdom of Denmark, the Burkina Sahel Project financed by the German Government and the National Land Management Programme (PNGT), co-financed by the World Bank, UNDP , the Kingdom of the Netherlands, the Kingdom of Denmark, and FIDA. This programme which is aimed at reducing poverty is in its second phase. 2.6.2 The different projects mentioned in paragraphs 2.5.1 and 2.6.1 acquired a wealth of experience in the following areas. The people’s accountability, self-development, farming methods, land management, poverty reduction, project management and coorination. The Natural Resources Management Project, Phase II will benefit from these attainments to build its locally-based development strategy. 2.7 Bank Group Strategy

The second phase of the project falls within the context of Bank Group operating strategy in Burkina Faso. This strategy aims at promoting operations with greater impact on poverty reduction, while affecting mainly rural development and transport sectors. While giving importance to rural development, the Bank Group aims at diversifying and developing farm production and reinforcing food security thus contributing to rural areas deterioration control and improving rural living conditions. Emphasis is put on water control to reduce populations’ exposure to infectious diseases and on the fertilisation and conservation of soil to enhance productivity. The strategy also aims at reinforcing access roads to help transport of farm products, encourage better organisation of markets for farm products but also access to water points. In this regard, operations should mainly concern feeder road maintenance and rehabilitation of earth roads. Bank operations are also focused on support to reinforcing micro-finance and micro-enterprises within the context of a partnership between the State, private operators and NGOs. In this regard, deceentralisation consitutes an iddeal framework for local development, micro-projects and local initiatives. 3. THE SUB-SECTORS CONCERNED 3.1 Major Characteristics 3.1.1 The sub-sectors concerned by this project operate under difficult circumstances, characterised by: (i) irregular and low rainfall; (ii) a very short vegitation period; (iii) high population pressure; (iv) accelerated environmental deterioration due to water and wind erosion, the reduction or abandoning of fallowing. These factors are some of the major constraints facing forestry, pastoral or agricultural production. Out of 274 000 km2, the total cultivable area is generally estimated at 9 million hectares (35%) of which 8.9 million ha in rain-fed farming and 0.1 million ha. In irrigated farming. The rest (i.e. nearly 17 million ha.) are natural formations.

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3.1.2 Natural forest formations produce 3 to 4 million m3 of timber yearly, contributing considerably to the country’s economic development. However, the combined impact of bush fires, uncontrolled felling and over-grazing have led to the gradual reduction of trees and tree species. The definitive replacement of savannah woodlands by herbacious formations leaves the zone completely bare. 3.1.3 The agricultural sub-sector is considerably undeveloped. Agriculture uses a rain-fed system with traditional and manual methods. It is still barely diversified. Cereals (millet, sorghum, fonio, maize and rice) are the country’s major crops as well as the principal food crops. Average output varies according to the region. Yearly average cereal production stands at 2 500 000 tonnes, of which 123 000 tonnes of paddy. The sub-sector performs poorly; its 2.5% cannot compensate for 3% yearly population growth and explains the country’s food deficit. The poor performance is due to factors mentioned in paragraph 3.1.1 and the current production systems. However, the agricultural sub-sector has significant potential (see paragraph 2.1.3). . 3.1.4 Livestock breeding is an important sub-sector not only in terms of its contribution to the GDP but also in connection with improvement of the people’s living standards. The national livestock population is estimated at 4.5 million cattle, 6.2 million sheep, 7.9 million goats, 496 000 pigs, 525 000 asses and horses. In general, livestock productivity is low (110 kg per carcass yearly and per animal for cattle and a 12% offtake rate). Milk production is estimated at 175 555 tonnes, 37 392 tonnes of which are marketed. The poor performance of the livestock sub-sector is also due to constraints mentioned in paragraph 3.1.1. 3.2 Rural Sector Institutions 3.2.1. Currently, the rural sector comes under the following ministries (through their decentralised structures and specialised agencies) : the Ministry of Agriculture which controls most crop production activities ; the Ministry of Livestock which controls livestock production activities, the Ministry of the Environment and Water which covers all irrigation activities as well as environmental, forestry, faune and fisheries issues, the Ministry of Secondary, and Tertiary Education and Scientific Research which is responsible for agronomic and environmental research; the Ministry of Health. These ministries are represented in the country’s interior by regional and provincial directorates. 3.2.2 To fulfill their mission, the ministries use specialised agencies, especially: (i) the National Institute of Environment and Agricultural Research which is resposible for agronomic research, including livestock; (ii) the Rural Water and Infrastructure Fund which is a public agency set up to manage and co-ordinate funds intended for rural water and infrastructure development; (iii) the National Agricultural Credit Agency, a corporation in charge of granting agricultural credit; (iv) the National Soils Bureau responsible for soil analysis; (v) the National Council for Environmental Management responsible for environmental management; (vi) Non-Governmental organizations (NGOs) that implement specific programmes; (vii)the National Artificial Insemination Centre for implementation of the cattle genetic improvement programme; (viii) professional farmers’ organisations to organise and operate rural areas, rural financial institutions for the financing of agriculture in rural areas; (x) the soil fertility management unit responsible for restoring and maintaining soil fertility. These agencies and administrative departments have vast experience and acknowledged skills, as well as adequate equipment. They effectively provided their services in the field during the project’s first phase.

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4. THE PROJECT 4.1 Project Design and Rationale 4.1.1 The Decentralized and Participatory Rural Development Project in the Bazéga and Kadiogo Provinces is part of the Natural Land Management Programme which benefits from the support of Burkina Faso’s development partners. The strategy adopted is based on the decentralised rural development strategy which takes into account land management and local development approaches. This strategy is based on basic principles initiated by the Government in agreement with donors operationing in Burkina Faso. All the donors supported, in a lettre of 27 March 2000 sent to the Ministry of the Economy and Finance and signed by 12 donors including the World Bank, the European Union, FAO, AFD, Switzerland and the Kingdom of the Nethelands. The ADB also approved this initiative. The statement approves the basic principles of the strategy as mentioned hereinafter: administrative and institutional decentralisation according to the profiles of rural communities, grass- roots communities’ total accountability, implying that the planning of investment actions, control of communal investment structures ensured at the local level by the recipients themselves, extending the sccope of investments financed by the Project, refocusing the State’s role, involving private operators and civil society in support to rural communities for the planning and implementation of their projects. The principle of co-financinmg community investments, different levels of negotiation (rural communities, decentralised rural communities, technical and administrative State services, NGOs, civil society and financial partners) and the flexibility which assumes the adaption of tools to local specificities. 4.1.2 The recommended approach calls for the participatory approach. It appears as the only participatory and pertinent approach likely to bring out original ideas and strategies, on the one hand, and on the other hand to encourage populations to be determined to manage to enhance their own capacities to act by finding the facilities that will permit them to make optimal investment choices, to maximise the resource potential that they have. It will develop in five (5) stages (described in paragraph 4.5.14). The particapatory strategy thus defined falls within the framework of selected co-operation between the World Bank and the ADB in respect of development. 4.1.3 Following socio-economic surveys conducted during implementation of the negotiations organized in the course of preparing this project and results of the PGRN completion report, and in view of the situation in the Project zone characterised by irregular and slight rainfall, the naturally poor soil quality, population pressure and accelerated destruction of the natural forest, it is essential to develop agro-sylvo pastoral activities by associating all actors (Government, specialised agencies, communities, target groups, NGOs, consulting firms) in organizing and implementing Project activities. Furthermore, the Project also uses the gender and development approach, which concerns all socio-professional groups. The said approach integrates all the actions carried out by women (agriculture, livestock, loggers, craftsmen, fishermen, etc.), private operators, decentraised State officers. It is also going to be inspired by the experiences of projects being implemented in Burkina Faso and elsewhere.

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4.1.4 The activities envisaged within the framework of this Project are the same as those recommended by PNGT and undertaken by PGRN. They are described in paragraph 4.5.1 However, the orientation of this Project is different from that of PGRN. Moreover, PGRN is limioted to the development and management of 80 villages dispersed throughout the Bazéga and Kadiogo Provinces whereas the Project zone contains 2 villages. It is based solely on the village management approach. PDRDP is incorporated in a decentralised and participatory rural development strategy through village management and local development approaches. The actions envisaged will concern all the 323 villages and inter-village spaces. Supervision will cover 54 villages per year. The pace of supervision followed by local development projects implemented in Burkina Faso is 70 villages per year. Furthermore, the Project zone covers 13 departments instead of 11. The current Project design is the result of organised agreements between the ADF, the populations concerned, the authorities, NGOs and all the donors who operate in Burkina Faso. 4.1.5 To contribute to poverty reduction in Bazéga and Kadiogo, the PDRDP will consolidate the achievements of the first phase. It will emphasize : better organisation of the people, sustainable natural resource management, intensification of agro-sylvo pastoral production, promotion of the private sector and use of specialised and experienced agencies to implement development programmes and promote rural women. The crops retained are : millet, sorghum, maize, groundnuts, rice, soja, sesame, vegetables, fruits, cashew, fish, meat, honey, chicken, guinea fowl, timber. Usually, they are produced in the Project zone and enter in the food compoosition of populations in this zone. 4.2 Project Zone and Beneficiaries

Location and Physical Context 4.2.1 The PDRDP zone of operation covers the PGRN zone in addition to two deppartments in the Kadiogo province that were not included in the PGRN. It is composed of two provinces : that of the Bazega (7 departmenta) and the Kadiogo (6 departments), It covers 5,599 km2 of which 3 644 km2 for Bazéga and 1,955 km² for Kadiogo. The choice of the zone is justified by the fact that the population is very poor and lives in a very precarious situation. The area has insufficient cereal although, in this regard, it has enormous potential. 4.2.2 The climate of the zone is sudanian tropical. Annual rainfall ranges from 600 to 900 mm, sometimes with high inter-annual variations. The region’s relief is even and slightly undulated. The Nazinon and Nakambe rivers make up the water network, supplemented by several water pooints and wetlands filled with water during the rainy season. Most of the soil is poor in organic matter. Natural crop formations deteriorate rapidly under the impact of man and over-grazing.

Socio-Economic Context 4.2.3 The population of the Project zone is poor, mainly rural and estimated at 219,500 inhabitants. Moreover, 30% of the population in this zone lives in extreme poverty. 51% of the population is affected by poverty. The inhabitants survive in a difficult environment characterized by : malnutrition, inadequate health coverage, insufficient educational structures, (the enrollment rate is 31.65%), difficult access to potable water, increasingly unsanitary conditions and continual deterioration of natural resources and almost continual food insecurity. Hence there is a need to cover normal caloric requirements (about 3500

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Kcal/pers/day against 2,300 Kcal/pers/day currently) and to increase the consumption of meat and meat equivalent from 9.3 kg/pers/year currently to 21 kg/pers/year by 2010. Furthermore, low incomes and growing populations are the causes of this situation. It is influenced by migration and HIV-AIDS which affect all the regions of the country. 4.2.4 Agricultural production is in the hands of family farms whose average size varies from 2 to 5.5 ha. There are three types of farm systems: traditional system, improved traditional system and the modern system. To each system corresponds a type of farming. The cultivated area is estimated at 154 020 ha. The major crops in the zone are millet, sorghum, maize, rice, tubers, fruits and vegetables, sesame and groundnut. Average output is as follows: millet- 800 kg/ha.; sorghum-1 150 kg/ha.; maize- 1 400 kg/ha., sesame- 500 kg/ha.; sweet potatoes- 9 000 kg/ha.; unshelled groundnut- 1000 kg/ha.; wetland rice- 1 200 kg/ha.; fonio- 120 kg/ha. 4.2.5 Livestock farming is one of the zone’s major activities. The livestock population consists of 239.800 heads of cattle, 215.000 sheep, 248.000 goats, 23.900 pigs, 24.900 asses, 1.224 goats, and 960.300 fowls. Between 1995 and 1999, the herd increased by 2% for bovine, 3.0% for goats and 2.2% for pigs. Dairy production is low and consumed on-farm. Three kinds of farm systems exist: modern livestock breeders account for 10% of the farmers; improved traditional breeders account for 70% of the farmers in the area; and traditional breeders account for 20% of the farmers. Cattle feed comprises mainly natural grazing, which has caused over-grazing in the zone. There are insufficient water points. Health coverage is not ensured. The Project zone lacks processing infrastructure (killing floor, milk collection centres). Status of Rural Women 4.2.6 Women participate in all cropping activities, but witthout being involved in the organization, conduct of the farm and management of harvest. However, women play a key-role in food production which implies that more resources should be given to female farmers to enable them to exploit the considerable potential for economic growth in the Project zone. Women’s organizations (village women’s cooperatives, village youths’ organisation, mixed village groups) are often characterised by dynamism so that in the field women’s organizational capacities are a positive factor on which to anchor certain activities, which traditionally are undertaken by women. The dynamism of women’s associations /groups is reflected in many initiatives, sound implementation of micro-projects and good management of micro-credit (contrary to male organisations) even if the loans allocated are for small amounts. Despite the efforts made during the first phase of the Project, women know the organizational limits undoubtedly related to their illiteracy and to a lack of training. 4.2.7 In the area of stock breeding, women are involved in sheep fattening and raising poultry, sheep, goats and even cattle. The proceeds of stock breeding are used to finance women’s income-generating activities and to help solve family problems. However, due to their low financial capacity, their herds are very small and vulnerable to epizootic diseases. 4.2.8 As regards school enrollment much remains to be done. Despite the efforts made during the first phase in this regard , the enrollment rate for girls is still low due to sociological reasons (24%). While the literacy rate for women is below 20%, the socio-cultural and economic considerations that deem the enrollment of girls a waste for the family, lay emphasis on boys’ education. The health of pregnant women, mothers and children has regressed during the last ten years. Indeed, the maternal mortality rate increased. Currently,

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it is 950 per hundred thousand. The infant and child mortality rate is 105 per thousand. The deterioration of the situation is mainly due to endemo-epidemic diseases. Several factors related to access to and the quality of health care underlie that situation and explain the major contrast between urban and rural areas (24.1% of the children in uran areas are poorly nourished against 41.6% in rural zones). The food and nutritional situation is alarming for women and children up to 8 years of age. Women’s status is aggravated by the rapid expension of HIV-AIDS (7 to 8.5% prevalence rate among women).

Condition of Youths 4.2.9 Youths are among the vulnerable groups. They are left to their own devices and live in a precarious environment characterized by: the absence of income due to the low level of economic activities in the area, infectious diseases, poor hygiene and illiteracy. This situation creates despair among youths and causes the migration to Ouagadougou and Cote d’Ivoire. It is worsened by HIV-AIDS (7.4 to 8.5% prevalence rate among youths).

Extension and Supervision 4.2.10 Sensitization, information, extension, education and communication activities are not developed in the Project area. It was noted in the first that inadequate communication is attributable to the populations low level of agreement with Project actions. Extension and supervision activitities will be conducted by the Regional Directorate of Agriculture in the Ministry of Agriculture for the agricultural component, the Regional Directorate of Livestock in the Ministry of Livestock Resources for the livestock component and by the Regional Directorate of the Environment in the Ministry of the Environment and Water for the forestry component. The current supervision mechanism comprises 189 staff including 133 staff members from the Regional Directorate of Agriculture, 26 officers from the Regional Directorate of Livestock Resources and 30 from the Regional Directorate of the Environment. The current extension design recommends using multi-purpose advisers. This design is still encountering some problems insofar as the supervision is currently conducted by three ministries. Until a single structure is set up, current supervisory mechanisms should be reviewed and strengthened to increase their efficiency.

Rural Structuring 4.2.11 Daily life is organised around 323 villages grouped into 150 rural communes (80 in Bazèga and 70 in Kadiogo). The village comes under the commune. The average size of a village is 680 inhabitants, or 85 households. To ensure the development of their villages, the people organise themselves into village land management committees (CIVGT) and inter-village land management committees. (CIVGT) Currently there are 80 operational CVGTs of which 59 in Bazéga and 21 in Kadiogo. These agencies are in particular responsible for allocating, evaluating and the withdrawal of land from the national public domain at the village and inter-village levels. They are also responsible for preparing management and land development plans. These plans are then integrated into the overall rural commune plan. The CVGTs or CIVGT are also responsible for ensuring the management of community infrastructure, village forests, grazing-grounds, fauna and the natural resources of the land in general. Each CVGT or CIVGT comprises the following agencies : a General Assembly, a bureau-specialised sub-committees (SSCs) which include farmers’ organisations and a follow-up and monitoring committee. It groups all the people and farmers’ organisations that live on its territory. It is directed by a bureau composed of at least 6 members.

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4.2.12 CVGT and CIVGT financial resources are made up of :membership contributions; income from the activities undertaken, grants and subsidies. The bureau is in charge of managing funds and is required to present to the General Assembly for consideration and approval, an annual report on the management of resources. The follow-up and monitoring of CVGT and CIVGT activities are carried out by follow-up and monitoring committees. The latter also contribute to the management of resources of CVGTs and CIVGTs. They give account of the CIVGTs to the General Assembly. The folllow-up and monitoring committee of the CVGT is composed of three people selected by the General Assembly. 4.2.13 The rural commune is a financially autonomous local collectivity and public corporation. It comprises several villages sharing the same land united by solidarity resulting especially from proximity, common interests and are able to find a mutual means for their development. A Rural Council, comprising elected men and women manage the rural commune. The Council is a deliberating organ and is responsible for preparing the communal development plan based on the local development plan. It mobilizes financial resources locally to fund investments, serving as the contracting authority and manager. The communes also have other rural associations that work in close collaboration with the CVGTs and CIVGTs. All rural associations in the Project zone are fragile and hardly operational, hence the need to organize and strengthen them. 4.2.14 In turn, the rural communes come under the province. The province is a local authority and public corporation. It is run by an elected Provincial Council and is responsible for: promoting the province’s economic, educational, social, health and scientific development; preparing the provincial development plan based on communal plans and land management and development plans put together by the CVGTs and CIGTs and organizing provincial development while respecting the integrity, autonomy and responsibilities of rural communes and villages. It is also incharge of: setting priorities for structural investments in collaboration with the central government and ensuring that investments are consistent and complementary. .

Rural Credit 4.2.15 The project zone has no banking network. Credit is mostly distributed through the Burkina Faso People’s Fund (RCPB) network. The RCPB has four agencies in the following four departments: Kombissiri, Koubri, Saponé and Toécé. In 1999, the RCPB made CFAF 180 million in savings and allocated CFAF 118 million in credit (all short-term credit). The credit recovery rate stands at 73%, owing to the the absence of close follow-up of beneficiaries. Two other projects (Women’s Income Generating Activity Support Fund (FAARF) and the Food and Nutrition Security Project (PSAN) allocated limited amounts of credit. Credit distributed in the project zone had a very marginal impact because it fell far short of needs. The loans were alloccated exclusively on the short-term---which does not favour the increase in the production capacity and productivity improvement.

Constraints, Prospects and Opportunities 4.2.16 The project zone’s development is confronted with the same constraints as those described in paragraph 2.3. To those constraints can be added: farmers’organisations’ limited management capacity, lack of extension services, sensitization, information, education and communication, unsuitable extension services, migration, project zone’s

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isolation and over-grazing. Despite these many constraints, Bazéga and Kadiogo Provinces have land, a youthful population and highly nutritive graminacious plants forfeeding livestock. The emergence of professional farmers’ cooperatives is also a major asset. 4.3 Strategic Context

Mainly an agricultural country, Burkina Faso faces very austere national production conditions (irregular rainfall, poor and limited farmland and grazing grounds). Since the sectoral policies and strategies and the various approaches had not produced good results, it became necessary to develop Bazéga and Kadiogo provinces from the foundation by using a participatory and decentralized development policy, putting accountability in the hands of the people and emphasizing; better organisation of the people ; transfer of responsibility to the people ; sustainable natural resource management ; intensification of agricultural and livestock production ; private sector promotion and use of specialized and experienced agencies to carry out development programmes ; poverty reduction ; strengthening of food security ; and project divestiture and sustainability of activities undertaken. 4.4 Project Objectives

The sectoral objective of the project is to contribute to poverty reduction. Specifically, the project aims at strengthening food security, managing natural resources, increasing agricultural and livestock production and enhancing the people’s income.

4.5 Project Description 4.5.1 The major achievements of the Project include: development of 29,250 ha. of rain-fed crops; development of 140 ha. of irrigated rice, 600 ha. of low lands and 1000 ha. of arboriculture, rehabilitation of 1920 ha. of old low lands, recuperation of 1000 ha. of glacis, development of 3000 ha. of natural grazing grounds, 200 km of cattle tracks, 30 km of rural roads and 100km of forest paths, improvement of productivity, establishment of a credit fund worth UA 1.50 million for income-generating activities, construction of 2 multi-purpose reservoirs, development of crocodile swamp, rehabilitation of 7 multi-purpose reservoirs, development of 1500 ha. of natural village forests, creationof individual forest plantations and 1500 ha of fire-breakers, construction of 23 boreholes, rehabilitation of 15 boreholes and 45 well, creation of an observatory for the environment, construction of 8 schools with 3 classrooms each, construction of 3 health centres, establish a fund worth UA 1/5 millionand a fund for UA 0.27 million to support the community STD and AIDS control programme, establishment of a multi-disciplinary team to initiate a locally-based development process and to ensure the reinforcement of local capacities 4.5.2 Major Project Components :

A. Improvement of production systems ; B. Natural resources development and management ; C. Improvement of living conditions ; D. Local capacity building ; E. Project management.

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Component A : Improvement of Production Systems 4.5.3 Agriculture : the Project will set up a crop intensification programme covering 29.250 ha. of rain-fed crops, 140 ha. of irrigated rice farming, 2.520 of wetland rice farming, 23 ha. of market gardening and 1.000 ha. of arboriculture (cashew and mango tress). It will use production methods based on legumes and organic manure enriched with natural phosphate. Technical training will be dispensed to farmers to improve their productivity. The Project will set up credit to fund agricultural inputs (see paragraph 4.5.17). 4.5.4 Livestock : the Project’s livestock component will concern the following species: sheep, bovine, pigs and poultry (fowl and guinea fowl). It will focus on: improving livestock conditions (health, feed, watering and shelter); installation of private veterinaries; and genetic improvement by crossing sheep species imported from Mauritania and goats imported from Brazil and artificial insemination. However, it should be pointed out that the imported species (bovine, sheep and goats) proposed are already used in Burkina Faso and Senegal. They perform well and adapt to the country’s ecological conditions. The Project also plans to improve and develop traditional poultry farming and bee-keeping (both, in addition to pig rearing, will be exclusively reserved for women and youths). Details on the livestock component are given in Annex 4, Volume 2 of this report . 4.5.5 Research-Development : will focus on the following issues: identification of technical options tried and tested in other places ; production of basic crop seeds ; producition of forestry seeds; genetic improvement ; improvement of traditional poultry farming; improvement of livestock health; improvement of soil fertility; integration of livestock/farming; operators socio-economic follow-up. These research topics will be supplemented by others identified by the beneficiaries via the participatory approach. Research-development activities will be entrusted to institutions indicated in Annex 7 under the coordination of the Centre national de recherche scientifique et technologique (CNRST). The latter will validate the results before handing them over to the producers. 4.5.6 Supervision and Extension : will concern all the villages and communes of Bazéga and Kadiogo. They will be under the authority of the Direction régionale de l'agriculture, the Direction régionale des ressources animales and the Ministère de l'environnement et de l'eau respectively(cf. ANNEX 7). The Project will draw support from the current supervisory mechanism, which it should restructure, strengthen and improve to avoid weaknesses noted during the first phase. In this regard, specific training is envisaged to further improve supervisory officeers’ productivity. Supervisory services will train the populations in cropping practices, Asoil fertility maintenance and restauration technics, seed conservation, product processing, reforestation. The subjects to develop within the context of supervision and extension will be identified by farmers as part of the management plans. Component B : Natural Resources Development and Management 4.5.7 Actions planned under this component will focus on desertification control through: natural regeneration of vegetation through soiln treatment; development of 1.500 ha. of village natural forests, fight against uncontrolled felling of trees and bush fires through sensitization actions, creation of fire breakers, creation of village, family and individual plantations, promotion of agro-forestry, establishment of a network of private nursery farmers to produceforest and fruit plants, and the replanting of certain threatened medicinal and woody species. , training of 140 environmental assistants. Detaiuls of the scheduled actions are given in Annex 4 of Volume 2 of this report.

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4.5.8 Other activities planned within the framework of this comonent will focus on: development of 2 reservoirs and the rehabilitation of 7 others, development, development of the Bazoule crocodile swamp, development of a 140 ha. irrigation scheme; development of 600 ha. of wetlands and reservoirs downstream, rehabilitation of 1920 ha. of old low lands, protection of watersheds and banks, development of 30 km of rural roads, recuperation of 1000 ha. of glacis (by scarification) and combination of livestock and farnming, restoration and maintenance of soil fertility. Details on this component are given in Volume 2 of this report. 4.5.9 The Project will set up an environment observatory whose responsibility will be to: organise surveillance, constant and close monitoring as well as rational management of environmental impacts in order to prevent any negative effects and ensure that mitigating measures are taken and the expected effects produced, assist the population concerned to prepare action plans and prepare environmental impact surveillance, monitoring and management indicators. The observatory will also be responsible for training Project and CONEGESE staff on environmental impact surveillance, monitoring and management. Component C : Improvement of the Living Sytandard 4.5.10 This component will concern the potable water supply, sensitizing rural communities to sanitation in the area, the contribution of education and STD and AIDS control. Itl is the result of the needs expressed by local communities during preparation and appraisal missions organised by the Bank. The abovementioned actions should encourage the populations approval of Project activities and guarantee the sustainability of the Project actions. 4.5.11 Drinking Watter Supply : the Project will implement the village water programme with focus on: creation of 33 boreholes,rehabilitation of 15 boreholes and 48 large wells, establishment of a manual pump maintenance system. Village selection will be based on request from the people and an inventory of needs via the participatory process. . 4.5.12 Sanitation : the Project’s sanitation programme will comprise the following activities: participatory diagnosis of the villages concerned, preparation and implementation of a health education policy in the Project zone, construction of latrines in schools, health centres and villages (10 per village) waste management (wate water, household garbage, etc) through the construction of two garbage dumps per village. The sanitation programme will be backed by extension services, sensitization and health education, and the definition of a post-programme monitoring policy. 4.5.13 Education : the Project plans to build 8 schools with 3 classrooms each equipped with toilet blocks, improve the material working conditions by supplying classroom equipment, procure teaching materials (textbooks, teaching aids, boards, chalk,etc) and give the primary education inspectorate the possibility of monitoring the quality of the instruction dispensed . The Government will provide schools with the needed qualified teaching staff and bear the operating expenses. 4.5.14 Improve Health and Nutritional Coverage and Combat STD/AIDS: actions to improve heath and nutritional coverage concern: the construction of 3 health centres (CSPS). The Government will provide qualified health staff to run such centres and bear the operating expenses, equipping the 3 CSPS, conducting surveys to determine public health prophylactic measures and special measures in connection with maternal and child health, with a view to

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controlling water and air pollution, provision of all CSPS in the Project zone with essential generic drugs The UN organisations. Operating in the Project zone have shown their interest in contributing to the improvement of the heath and nutritional coverage and to combating STD and AIDS. Thus WFP will provide food products (cereals, beans and edible oil) for pregnant women and nursing mothers and undernourished children aged one to five,. The Project will also carry out STD/AIDS control activities based on a multi-sectoral plan. Actions scheduled include: information, education and communication to prevent HIV/AIDS and STD, directed at farmers, the illiterate, pupils, women, migrants, Project officers and artisans. In that regard, the project will use the services of specialised NGOs, to carry out these actions. These NGOs will encourage self-enhancement of people affected and will grant them food and material support. The co-ordination of actions within the framework of the struggle against STD and AIDS will be ensured by the National Committee to Combat AIDS in collaboration with the Central Regional Directorate of the Ministry of Health It will also support the NGOs in organising training sessions and contact with the target population. Pharmacy managers will be trained by a structure that will be recruited on the basis of a short list. Component D : Local Capacity Building 4.5.15 Implementing the Local Development Process: The Project will support the 323 villages and 150 rural communes in their efforts to organise, plan implement and manage their lands through the planning process, on the one hand, and the participatory approach on the other hand measurable by its capacity to restore confidence in individuals and communities so as to involve them in combating their own vulnerability owing to initiatives and actions liable to improve their well-being. This planning process comprises five stages: contacting grass-roots communities (collect information, become familiar with the area, sensitise the community and arouse determination) ; ii) participatory diagnosis (analysis of problems , setting objectives, identification of possible solutions) iii) determining the order of priority of needs (choice of action ) ; iv) preparation of local development plans (organisation, planning, thematic training and extension work) ; v) implementation (monitoring-evaluation, village self-evaluation ).The local development process will be set up by a NGO or a consulting firm that is thoroughly knowledgeable of the Project zone Pour To accomplish its mission, the consulting firm or the NGO will set up an experienced multi-disciplinary team made up of rural communication experts and 25 local extension workers and directed by an expert in rural communications. The multi disciplinary team will be responsible for extension work, sensitisation and will work in close collaboration with the supervisory structures. The duration of the experts’ mission will range from 1 to 3 yyears. The extension workers will be used throughout the implementation period.. 4.5.16 Improvement of Local Capacities : this component includes all the activities intended to improve the management capacities of the community and the populations. The envisaged actions concern: support in the organisation and restructuring of farrmers’ organizations (CVGT, CIVGT, SCS, groups ) and specific training of farmers and leaders of farmers organisations. It will be the responsibility of the multi-disciplinary team. The specific training will concern the organisation, stock management, budget preparation, financial management and accounting, procurement of goods and services, technical aspects and will be dispensed by a consultant. The improvement of local capacities also aims at giving advice which will be ensured by a consultant. This support will concern the planning of rural activities, development and land management, organisation and management of rural communities, preparation of by-laws and rules and regulations for farmers’ organisations, financial management and accounting supply and distribution of inputs. It also concerns

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literacy and post literacy, training of trainers, strengthening farmers’ organisations through logistic and institutional support and private sector promotion in respect of supply, marketing and processing activities. The Project should help the populations to develop a methodology and a range of tools for the implementation of a land securement strategy and, based on the participatory approach, propose an appropriate legal framework that will facilitate the procurement and management of land resources and permitting he settlement of disputes. 4.5.17 Support for Community Activities: to provide local development and to support community activities, the Project will set up a local investment fund for UA 1.50 million. This fund will be managed by the CVGT and the CIVGT. It is intended to finance village and inter-village community sub-Project on the basis of the results of the participatory process that includes: priorities selected and accepted by the people, the local development plan and corresponding financial package. Community activities will be financed according to eligibility criteria defined in the procedures manual prepared by the Project with the assistance of the multi-disciplinary team and submitted to the ADF for prior approval. The Beneficiaries will mobilise counterpart support in cash and kind representing 20% of the total investment value. Community sub-projects initiated by women will be fully subsidised. FIL investments are meant to improve the people’s productivity and living standard. The village and inter-village sub-Project categories that the FIL may fund are given in Volume 2 of this report. Details regarding the use and working of the FIL are given in Paragraphs 5.2.2 and 5.2.3 4.5.18 Support For Income-Generating Activities: the Project will put at the beneficiaries’ disposal a credit of UA 1.50 million to finance income-generating activities related to vegetal and livestock production, reforestation, procurement, processing, commercialisation, installation of private veterinarians and other income-generating activities. Credit will be extended by decentralised financial structures selected by a committee set up for the purpose. Resources of the credit component will be subject to separate accounting. 4.5.19 Women will actively participate in income-generating activities. They will also develop production activities (rice, market gardening, fisheries, agriculture, traditional poultry farming, milk collection, bovine and sheep fattening, beekeeping), processing (cereal mill, karite butter, peanut butte, smoked fish, sesame, milk) and marketing of agricultural products (cereals, milk, fish, peanut butter karite butter, fruits and vegetables). Carrying out all of these activities will be ensured owing to credit funds. Details regarding the organisation and operation of rural credit are given in Paragraphs 5.2.4-5.2.7. Component E : Project Management 4.5.20 To mitigate organisation weaknesses noted during PGRN’s implementation, a Project management unit will be created. It will be composed of multi-disciplinary and experienced managers. The Government will assume responsibility for four and the Project will pay them allowances; a co-ordinator, a financial expert, an agro-economist and a rural jurist. The recruitment of the rest of managerial staff that is to say: a zootechnician, a socio-economist, hydraulic engineer, or irrigation engineer, an environmentalist, an agronomist, a credit expert, a veterinarian, internal management auditor and two agency managers will be funded by the ADF within the framework of the loan. The Project also plans to use the services of specialised agencies for implementation of Project components. .

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4.5.21 In addition, the Project will finance the procurement of equipment for the management unit and its operating expenses. Provision has been made to give the Project staff additional training. It will concern the following aspects: participatory approach, local development, extension service, sensitisation, information, education, communication, commercialisation and procurement of products, development Project management, genetic improvement, analysis and conduct of farm units. Project officers management training will be entrusted to the Agricultural Management Training Programme for Africa (AMTA) based at the Bank. Details regarding this component are given in Volume 2 of this report 4.6 Production, Markets and Prices Production 4.6.1 The Project’s production will be developed by farms supervised and grouped into several models (ANNEX 5). The selected models are designed according to area specifications, available natural resources and needs expressed by the population. Their structures also take into account the sex ration, the types of enterprises developed and the technological level achieved by the farmers 4.6.2 The actions envisaged within the context of the Project will concern mainly the improvement of productivity. They will improve yields and zootechnical parameters. From this improvement, a substantial increase in production will result. At full development (2010), the additional production under the Project will be about 6,000 tonnes of millet, 9,220 tonnes of sorghum, 2,541 tonnes of groundnut, 9,400 tonnes of rice, 1,000 tonnes of cashew, 31,258 tonnes of carcass meat, 20,43 million litres of milk, including 16,30 million litres of cows milk and 3.3 million chickens. Details are given in Annex 3 of Volume 2 of this report. Marketing and Market 4.6.3 Most of the Project products will be sold on different markets (collection markets, group markets, and terminal markets). Analysis of the cereal situation shows that the Project zone is has a shortfall. The cereal requirement coverage rate varies according to the agricultural season and the region. There are three categories of regions: regions with permanent surplus cereals (West), regions with cereal balance (North-West and East) and regions with a shortfall (Centre and Sahel). The food situation in households in Burkina Faso is precarious. In fact, average cereal consumption is estimated at 184 kg per person and per year in urban areas and 185.5 kg in rural areas. Cereal requirements were estimated at 1,621 million tonnes in 1990 and should be about 2.621 million tonnes for the year 2010. The shortfall is even more in unequipped households without animals. The caloric requirements are estimated at 2.500-3,000 calories per person and per day. However, energy consumption per person and per day is below 2,000 calories. In this regard, it is estimated that 62% of the cereal production under the Project. Will be for home consumption. The rest will be exported to other areas with shortfalls in the country. The cereal supply is estimated at 433,000 tonnes of cereal including 7% representing food aid, 23% cereals imported and 70% national production. It covers 76% of national requirements. In view of the increased requirements, additional production of groundnuts (2,931 tonnes) will be sold in the rural markets of Bazéga and Kadiogo 4.6.4 Fruit consumption is estimated at 12.21 kg per person and per year and vegetable consumption at 9.8 kg per person and per year. Furthermore, it is noted that the average marketing rates for fruits and vegetables are 70% and 50% respectively. National vegetable

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production covers requirements almost entirely (95% on the average between 1990 and 1997) while that of fruits covers barely half the requirements (47 to 52%). Vegetables produced under the Project will be exported. The green bean is exported to France regularly (80%). Togo and Cote d’Ivoire have shown special interest in tomatoes from Burkina Faso. Only part of the fruits produced under the Project will be exported, so as to take into account domestic requirements. 4.6.5 India, South Africa and Arab countries import large quantities of cashew nuts. The leading importer is India, which produces one million tonnes each year, whereas its real requirements are estimated at 1,5000,000 tonnes of fresh grains. India therefore has to import 500 000 tonnes, which it imports from Africa every year. However, all West African countries taken together cannot supply more than 150 000 tonnes of fresh nuts. Production in these various countries is as follows: 70 000 tonnes for Guinea-Bissau, 40 000 tonnes for Cote d’Ivoire, 6 000 tonnes for Benin, 5 000 tonnes for Mali, 5 000 tonnes for Burkina and 3 000 tonnes for Togo. Production under the Project is estimated at 1 000 tonnes of fresh grains. Although this production is significant for the producers, it has virtually no impact on the market. It should not be difficult to sell it. 4.6.6 Cattle from the project will also be exported. This option will not pose any major problem. In fact, cattle, goat and sheep exports from Burkina Faso have, on the average, been increasing since 1996. The exports have been to four coastal countries: Côte d’Ivoire, Ghana, Togo and Benin. On the average, exports to Côte d’Ivoire take 60% of the cattle, 75% of the sheep, and 51% of the goats. Exports to Ghana take 35% of the cattle, 18% of the sheep, and 34% of the goats. Togo has reduced its official imports from Burkina Faso. The decline is counterbalanced by the uncontrolled exports. Exports to Benin take 2% of the cattle, 2% of the sheep, and 3% of the goats. However, Ivorian importers seem to prefer Burkinabe cattle to Malian cattle because they have more flesh (47%) than Malian cattle (42 to 44 %). Furthermore, Burkina Faso has a railway line. In fact, railway transport costs are lower than by truck. However, conditions under which cattle is transported need to be improved. 4.6.7 The meat produced under the project will be sold in local markets. In fact, meat consumption is still low. It is estimated at 9.3 kg per person per year, whereas the target is 21 kg. Most of the milk produced is for home consumption. The quantity sold was estimated at 37,392 tonnes in 1997; it was sold in the big towns. However, most of the milk consumed is imported, and estimated at 21,790 tonnes in 1996, 26 718 tonnes in 1997 and 105,999 tonnes in 1998. The total value of imported milk was estimated at CFAF 8.982 billion in 1998. More than 90% of the imports are for the big urban markets of Ouagadougou and Bobo Dioulasso. On the other hand, chickens produced under the project will be exported to Côte d’Ivoire, which each year imports 1 million traditionally-raised chickens mainly from Burkina Faso. Prices 4.6.8 Cereal prices remained below 110 F/kg until February 2000. As from March 2000, the average prices of agricultural products in the project area reached 180 F/kg for white sorghum, 165 F/kg for red sorghum, 300 F/kg for millet, 250 F/kg for maize, 375 F/kg for cashew nuts, and 300 F/kg for paddy rice. As regards fruits and vegetables, the prices are unsteady and are determined by demand. The main problem encountered in the marketing of cattle and meat remains price variations. During festive periods, especially Tabaski and end-of-year festivities, livestock prices are high. Moreover, cattle prices tend to increase as time goes on. In comparison to 1993 levels, cattle prices in 1994 increased by 23% to 72% for all

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categories of livestock in major markets monitored by the Animal Statistics Service. In 1995, prices continued to increase through a relative variation of 20% to 67% in comparison to 1994 levels. As from 1996, prices dropped in several cattle markets, while price increases were lower in relative variation. 4.7 Environmental Impact 4.7.1 Positive Impacts: Activities of the project, classified in environmental category II, will not require new cleared lands, displacement of the population or introduction of new crops (or varieties). Project activities will eliminate the main anthropogenic causes of deterioration of the current environmental resources in the area. In fact, several plant cover restoration activities are incorporated in the project components: village reforestation, promotion of private nurseries and fruit farming, and planting of windbreaks in irrigation areas. Furthermore, the project will promote livestock activities by developing grazing lands, creating water points, and preparing agro-sylvo-pastoral land management plans, which define rules for land use and demarcation of grazing lands. The activities of the natural resource development and management component aim at ensuring rational management of natural resources, and could restore the balance of ecosystems. 4.7.2 Negative Impacts: The main potential negative impacts identified during project preparation are those arising from the development of irrigation schemes, and relating to the operation phase. A poorly designed drainage system for irrigation water could cause salination of the soil. There could also be incidences of diseases transmitted or reinforced by the presence of lakes and the negative effects of any abusive use of harvest conservation products on the health of farmers. The development of forest and rural roads could affect the plant cover and biodiversity, by intensifying deforestation for firewood and clearing of new farmlands. Soil and vegetation degradation could be observed around water points in the transhumance zone, in addition to the risk of introducing contagious diseases through transhumance cattle. 4.7.3 Mitigating Measures: The envisaged mitigating measures include the localization of water points, the creation of protective belts around river banks by planting prickly shrubs and developing access passages to level water. The incidence of water-borne diseases will be mitigated through health education and environmental hygiene activities, including the building of latrines and the sinking of wells (or boreholes) and the training of village health officers for the dissemination of prophylaxis notions. Through its team of its outreach workers, the project will inform users of the risks and how to apply pest control products. The creation of firebreaks will limit damage caused by late fires on the regeneration and productivity of natural forests. Constraints on natural resources will also be reduced by restoring degraded soils and implementing a grazing lands development and management plan. Riparian forests will be specially protected and enriched for the production of timber and industrial wood. Lastly, the project will offer rural communities the opportunity to prepare environmental action plans in their respective areas. Local environmental protection auxiliary staff will be trained to assist in the implementation of the plans. 4.7.4 Environmental Monitoring: Measures to mitigate the potential negative impacts of the project will be defined in the environmental management plan to be prepared and implemented by the Environmental Observatory. The observatory will comprise a consulting firm, which will work in close collaboration with CONAGESE, and the composite team responsible for outreach activities and sensitization. It will ensure that corrective measures

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are effectively implemented and that they produce the desired effects, based on pre-defined monitoring indicators. It will also assist the population in preparing their local environmental action plans. The loan conditions include the undertaking to submit the environmental management plan of the project to the Fund for approval. Environmental details are given in Annex 7 of volume 2 of this report. 4.8 Social Impact Impact on Women 4.8.1 Project activities will concern about 55,000 women. Special attention will be paid to them. Women will take active part in organizing the rural world. Their role as promoters of local development will be enhanced. Women will be involved in decision-making in CVGTs, CIVGTs, SSCs, and other farmer organizations. To that end, they will benefit from functional literacy, post- literacy, technical education and farm management training programmes. 4.8.2 Women will benefit largely from the Local Investment Fund (LIF) and credit. In fact, LIF will grant them comprehensive subsidies to carry out their community activities. The credit fund will provide them with substantial income. For example, the net profit of a fattened sheep is CFAF 18,000. One hectare with anti-erosion developments will generate an average of CFAF 43,000. 4.8.3 Women will receive appropriate guidance in health and education. Special programmes will be established for that purpose. The project will support the multisectoral STD and AIDS control plan. Implementation of the Health component should have a positive impact on women and children. For example, the maternal mortality rate should drop from 950 to 450 per thousand, and the infant mortality rate from 100 to 70 per thousand. To improve the nutritional status of women, food aid will be given to 30,106 pregnant and nursing mothers. The project will also carry out nutritional hygiene and education activities. Support for the school programme would increase girls’ enrolment and literacy rates. All activities for women will be scheduled with due regard for their housework timetable. Mills and water points will contribute to saving the time used for pounding millet and fetching water, and will enable women to organize their activities more freely. Impact on Poverty 4.8.4 Activities under this project will increase the incomes of farmers, as well as create permanent and temporary jobs. The incomes will come from several sources (agriculture, livestock, fisheries, forests, and bee farming), and will increase by 3% each year. The annual income per farmer will range from CFAF 99,200 to CFAF 110,258. Livestock will also generate substantial income that is above the poverty level estimated at CFAF 72,690 per adult per year. Job creation should benefit various socioprofessional categories (farm workers, woodcutters, and craftsmen). Increased incomes would help food crop farmers and large farm families who are the poorest in the project area. The population living in extreme poverty would reduce from 30% to 10% at full development of the project (2010). The situation would also modify the structure of household expenses, which would cover some food, health and education expenses. Socio-economic indicators would be improved, and the incidence of poverty would be reduced significantly. Accordingly, the enrolment rate would increase from 31.65% to 70%, and the literacy rate from 22% to 40%. The maternal and infant mortality rates would drop from 950 to 450 per thousand and from 105 to 70 per

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thousand respectively. Meat consumption could increase from 9.3 kg per adult per year to 21 kg per adult per year. Potable water supply coverage would be enhanced. 4.9 Project Cost 4.9.1 The total project cost is estimated at CFAF 19,599.40 million, or UA 20.24 million exclusive of tax and custom duties. The cost is broken down into CFAF 10,090.21 million, or UA 10.42 million, in foreign exchange (51.48% of the total cost) and CFAF 9,509.19 million, or UA 9.82 million, in local currency (48.52% of the total cost). Table 4.1 summarizes the costs by component, and the details are presented in Annex 3.

Table 4.1 Summary Project Cost Estimates by Component

COMPONENTS IN CFAF MILLION IN UA MILLION % in

F.E. L.C. Total F.E. L.C. Total F.E. A. IMPROVEMENT OF PRODUCTION SYSTEMS 1088.38 1460.90 2579.28 1.19 1.59 2.78 42.81 B. NATURAL RESOURCE DEVELOPMENT AND MANAGEMENT 2526.08 2830.71 5356.79 2.75 3.08 5.83 47.17 C. IMPROVEMENT OF LIVING CONDITIONS 2618.23 1058.36 3676.60 0.84 0.37 1.14 73.68 D. LOCAL CAPACITY BUILDING 3489.46 1670.20 5159.66 3.80 1.82 5.62 67.62 E. PROJECT MANAGEMENT 691.10 1138.33 1829.43 0.75 1.24 1.99 37.69 BASE COST 10413.26 8158.50 18571.76 9.33 8.03 20.22 53.74 PHYSICAL CONTINGENCIES 451.63 468.48 920.11 0.49 0.51 1.00 49.00 PRICE ESCALATION 658.91 1065.63 1724.54 0.60 1.16 1.88 38.30 T O T A L 9560.38 8829.65 18390.03 10.42 9.82 20.24 52.12

4.9.2 The cost estimates are based on June 2000 prices. A 10% provision for physical contingencies has been added to all base costs, except expenditure on staff, services and credit. A provision for price escalation has been added to all the components. The compound rate of 3 % has been applied to foreign exchange and local currency expenses. 4.9.3 The 3% rate is the inflation norm in UEMOA in all the economies of the sub-region. The current economic performance of Burkina Faso and the Government’s policy to consolidate it suggest that inflation in the country would not exceed 3%. As regards foreign exchange expenses, the 3% average rate is due to efforts made by industrialized countries to control inflation. 4.9.4 Table 4.2 below summarizes project costs by expenditure category:

Table 4.2 Summary Cost Estimates by Expenditure Category

IN CFAF MILLION IN UA MILLION % in CATEGORIES F.E. L.C. Total F.E. L.C. Total F.E. 1. WORKS 1537.20 3030.55 4567.75 1.67 3.30 4.97 33.60 2. EQUIPMENT 1073.00 0.00 1073.00 1.17 0.00 1.17 100.00 3. SERVICE 3122.56 352.20 3474.76 3.40 0.38 3.78 89.95 4.LIF 480.00 972.53 1452.53 0.52 0.98 1.50 34.67 5. RURAL CREDIT 450.00 1002.53 1452.53 0.49 1.01 1.50 32.67 6. TRAINING 991.40 326.56 1316.96 1.08 0.28 1.36 79.41 7. OPERATING COSTS 915.66 256.04 1171.70 1.00 0.21 1.21 82.65 8. STAFF 0.00 1716.73 1716.73 0.00 1.87 1.87 BASE COST 10413.26 8155.62 18568.88 9.33 8.03 17.36 56.08 PHYSICAL CONTINGENCIES 451.63 468.48 920.11 0.49 0.51 1.00 49.00 PRICE ESCALATION 658.91 1065.21 1724.12 0.72 1.28 1.88 38.30 T O T A L 10090.21 9509.19 19599.40 10.42 9.82 20.24 52.12

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4.10 Sources of Finance and Expenditure Schedule 4.10.1 The project will be financed by the ADF, the beneficiaries, and the Government of Burkina Faso, in accordance with Table 4.3 below:

Table 4.3

Sources of Finance

SOURCES

IN CFAF MILLION CURRENCY

IN UA MILLION CURRENCY

PERCENTAGE

F.E. L.C. TOTAL F.E. L.C. TOTAL (%) ADF 9560.38 4208.33 13765.39 10.42 4.58 15.00 74.11 GVT 0.00 2879.41 2879.41 0.00 3.34 3.34 16.50 BENEFICIARIES 0.00 1741.93 1741.93 0.00 1.90 1.90 9.39 T O T A L 9560.38 8829.65 18390.03 10.42 9.82 20.24 100.00

4.10.2 The ADF will cover 74.11 % of the total project cost, or UA 15.000 million. It will therefore cover all the foreign exchange expenses. The local currency costs to be borne by the ADF account for 22.63 % of the total project cost. ADF contribution will be used in financing all costs relating to equipment, services, LIF, rural credit and operating costs. It will also be used in financing part of the costs relating to the other categories. 4.10.3 The Government’s contribution amounts to UA 3.34 million or 16.50% of the total project cost. It will be used in financing part of the local currency costs relating to all categories, except equipment, LIF, and rural credit. The contribution by beneficiaries amounts to UA 1.90 million, and will be in the form of works. 4.10.4 The sources of finance by category of goods and services are presented in Table 4.4 below:

Table 4.4

Expenditure by Category and Source of Finance SOURCES ADF % CATEGORIES F.E. L.C. Total GVT BNF TOTAL ADF 1. Works 1.670 0.91 2.57 0.86 1.54 4.97 51.71 2. Equipment 1.17 - 1.17 - - 1.17 100.00 3. Services 3.40 0.09 3.49 0.29 - 3.78 100.00 4. LIF 0.52 0.98 1.50 - - 1.50 100.00 5. Rural credit 0.49 3.01 1.50 - - 1.50 100.00 6. Training 1.08 - 1.08 0.28 - 1.36 93.10 7. Operating costs 1.00 - 1.00 0.41 - 1.21 82.64 8. Staff 0.00 0.85 0.93 1.02 - 1.87 45.45 Base cost 9.33 3.93 13.21 2.61 1.54 17,36 76.09 Physical contingencies 0.49 0.19 0.69 0.16 0.15 1.00 69.00 Price escalation 0.59 0.53 1.10 0.57 0.21 1.88 58.51 Total project cost 10.42 4.58 15.00 3,34 1.90 20.24 74.11 4.10.5 Under this project, in compliance with poverty reduction objectives, 22.63% of the resources have been allocated to the financing of local currency expenses which were closely reviewed during appraisal. In addition, the local costs structure is justified by the need to continue restructuring the country’s expenditure in favour of the priority social sectors (health and basic infrastructure) as part of the review of public expenditure and in compliance with its poverty reduction strategy. In that connection, Burkina Faso benefitted from significant debt reduction under the HIPC Initiative. It also continues to receive budgetary

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assistance from abroad, particularly to finance the rural development sector which has greater impact on poverty reduction. Furthermore, ADF contribution to local currency expenses will spare the country additional non-concessional debt for reasons of budget discipline and commitment to the donors as regards structural adjustment and poverty reduction. 4.10.6 Expenditure relating to the other project components will comply with the schedule in Table 4.5 below:

Table 4.5 Expenditure Schedule by Component

(in UA million) Components 2001 2002 2003 2004 2005 2006 TOTAL A. Natural resource development & management 0.89 2.92 1.39 1.27 0.36 0.08 6.91 B. Development of production systems 0.90 0.61 0.69 0.49 0.31 0.25 3.25 C. Improvement of living conditions 0.53 1.15 0.84 - 0.44 0.24 3.40 D. Local capacity building 0.56 0.41 0.37 0.31 0.31 0.34 2.30 E. Project management 1.09 1.34 0.88 0.94 0.07 0.06 4.38 Total project cost 3.97 6.42 4.17 3.00 1.49 0.97 20.24

4.10.7 Expenditure by the ADF and the Government will comply with Table 4.6 below, based on the implementation chronogramme:

Table 4.6 Expenditure Schedule by Source of Finance

(UA million) SOURCES 2001 2002 2003 2004 2005 2006 Total ADF 3.58 4.77 3.02 1.89 1.09 0.65 15.00 GOVERNMENT 0.37 1.03 0.55 0.48 0.38 0.32 3.13 BENEFICIARIES 0.02 0.63 0.60 0.63 0.02 0.00 1.90

TOTAL 3.97 6.42 4.17 3.00 1.49 0.97 20.24

4.10.8 As indicated in Table 4.7, the recurrent expenses form the bulk of project operating costs. ADF contribution will increase during the first 3 years, and decline as from 2004. The decline is due mainly to the end of the services provided by most of the specialized bodies responsible for implementation of specific project components. The recurrent expenses shown in the table below do not include the maintenance and operating costs borne by the rural communities from their incomes.

Table 4.7 Trend of Recurrent Expenses

(UA million) Sources 2001 2002 2003 2004 2005 2006 Total ADF 0.33 0.39 0.46 0.31 0.29 0.28 2.06 GVT 0.14 0.15 0.15 0.14 0.14 0.14 0.86 Total 0.47 0.54 0.61 0.45 0.43 0.42 2.92

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5. PROJECT IMPLEMENTATION 5.1 Executing Agency 5.1.1 The project management structure is defined in the organization chart in Annex 2. It comprises the Project Management Unit, the rural communities, the specialized agencies, the provincial coordination committees, and the national coordination committee. Project Management Unit 5.1.2 The project components will be implemented concurrently by the specialized agencies which are experienced in their respective fields, while community activities will be carried out by the rural communities through the CVGTs and CIVGTs. However, all the project activities will be coordinated, supervised, and controlled by a Project Management Unit. The unit will be headed by a coordinator. It will be located in Kombissiri and placed under the supervisory authority of the Secretariat-General of the Ministry of Agriculture. The project unit will be assisted by two stations one of which will be located in Kombissiri (Bazéga Province) and the other in SABA (Kadiogo Province). The Coordinator will be responsible for coordinating, controlling, and monitoring all the project activities, preparing action programmes and budgets of the project, preparing bidding documents and disbursement requests for submission to the ADF, and preparing financial statements as well as monthly reports on project implementation. 5.1.3 The coordinator will be assisted by 12 experienced national senior staff as indicated in paragraph 4.5.18. He/she will also have support staff comprising 4 secretaries, 1 accountant, 3 account clerks, 4 drivers, 1 tractor driver, 3 security guards, and 3 clerks. In an effort to further improve the performance of the Project Management Unit, each of the national senior staff will coordinate and monitor the project activities corresponding to one or more specific areas grouped into 8 categories as indicated in the project organization chart presented in Annex 2. Rural Communities 5.1.4 Community activities at the village and inter-village levels will be carried out by CVGTs, CIVGTs and SSCs. These agencies bring together the entire farmer population and organizations. They participate in the participatory process explained in paragraph 4.5.14 with the assistance of the composite team in collaboration with the supervisory service.

Provincial Co-ordination Committees 5.1.5 At the Provincial Level, activities will be coordinated by two provincial coordination committees, one of which will be established in Bazèga and the other in Kadiogo. The provincial coordination committee is a provincial forum for technical consultation, comprising technical Government services, projects, NGOs, representatives of the civil society and representatives of the villagers. It will be responsible for: (i) ensuring the consistency and complementarity of operations; (ii) determining priorities for structuring investments in relation with the central Government; and (iii) monitoring and evaluating rural development projects and programmes in the province. The committee will be chaired by the High Commissioner of the Province. Secretarial services will be provided by the Project Management Unit.

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National Coordination Committee 5.1.6 At the national level, all project activities will be carried out by the National Coordination Committee, which is also a consultation forum for rural development partners, the Government (Ministries involved in project implementation) and technical and financial partners, village communities through their representatives, and the civil society. The Coordination Committee already exists. It will continue to coordinate, monitor, and guide project activities. It will also be responsible for verifying the consistency of project objectives with national policies, detecting inconsistencies, and proposing improvements to activities. It will review and approve activity programmes and budgets of the project. It will be chaired by the Secretary-General of the Ministry of Agriculture. Secretarial services for the committee will be provided by the Project Management Unit. The committee will meet twice each year. In view of the importance of the areas in question, the current committee will be strengthened. It will collaborate with the other ministries involved in the project implementation. 5.2 Institutional Provisions

Specialized Agencies 5.2.1 The Project Management Unit will use private operators, consulting firms, NGOs, and farmer organizations in concurrently carrying out project activities on contractual bases. The envisaged activities concern: (i) assistance and advisory services to village communities, analyses and local planning, implementation and monitoring of investments, varied training courses, construction of infrastructure, and supply of goods. However, due to the lack of specialized and competent private operators in some specific areas, the project will use the services of specialized agencies and the ministries indicated in Annex 7. Several of these agencies have already successfully carried out activities in the first phase of the project. Others have performed satisfactory services elsewhere. The services of Ministries and specialized agencies will be based on agreements, the drafts of which will be submitted the ADF for prior approval. The agreements will define the obligations and rights of the contracting parties.

Local Investment Fund (LIF) 5.2.2 The Local Invest Fund (LIF) will be managed by the CVGTs and CIVGTs in compliance with a procedures manual to be prepared by the project. The Fund will be domiciled in BCEAO. After a simple control to ensure regularity of procedures, viability and conformity with eligibility and sectoral policies (e.g.: school or health maps), the Project Management Unit will prepare a transfer order to the Ministry of the Economy and Finance, which will in turn prepare a transfer voucher for the CVGT or CIVGT receiving the LIF resources. Each CVGT/CIVGT will have a bank account in an authorized financial institution. The CVGTs and CIVGTs will be responsible for carrying out the works, and could, with the assistance of the project, recruit contractors and jobbers. 5.2.3 The project will provide assistance in management through recruited service providers and technical services with which protocols of agreement will be signed. The selection of priority investments and contractors as well as the management of funds and worksites will be subject to regular and strict control to ensure transparency. The control will be conducted by the project. A posteriori control will be organized by the Ministry of Agriculture. The project will provide part of the assistance in the form of subsidies to the investment; its

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amount will be specified in the procedures manual. The LIF will not finance private commercial activities.

Rural Credit 5.2.4 The envisaged credit system will be operated as part of the livestock development project in SOUM Province, Burkina Faso, financed by the ADF. It has been experimented in Senegal, and is producing good results with a credit recovery rate of 100 %. 5.2.5 The credit will be granted to producers by decentralized rural financial institutions (RFI) approved by the Minister of the Economy and Finance. The rural institutions will be selected by a board comprising representatives of the Ministry of the Economy and Finance, the Ministry of Agriculture, the Ministry of Animal Resources, the Ministry of the Environment and Water, and BCEAO. Selection will be competitive, and the most efficient RFIs would be taken; it will be based on prudential standards defined for UEMOA. The standards will be submitted to the Bank for prior approval. The selected institutions will be evaluated each year; those which no longer meet the standards will be suspended, and will resume activities only when their performance is deemed good. The credit will be onlent to these rural financial institutions on the basis of onlending agreements the standard draft of which will be submitted to the ADF for prior approval. To facilitate operations by the RFIs, the Ministry of Finance will organize their technical supervision in compliance with the relevant UEMOA policy. 5.2.6 Credit resources will be disbursed and deposited in a special account to be opened for that purpose, and each financial institution will make drawings according to their needs for the annual programmes and as the credit files are approved. The decision to grant loans will be taken by the RFIs. The special account will be opened in a commercial bank. Two other accounts will also be opened in the commercial banks; the first account will receive the repayment of credit funds onlent to the RFIs, and the second will receive the Guarantee Fund resources. Resources for the operating expenses of the project will be deposited in a Treasury account. 5.2.7 There will be two types of credit: short-term credit, and medium and long-term credit. Each type of credit will have its own rate. The interest rate will be equivalent to at least the market rate. However, it should include an adequate margin to cover operating expenses. For purposes of analysis, an interest rate of 15 % has been used. Before credit activities actually start, a circular letter will be prepared by the Project Management Unit and sent to financing institutions; the letter will provide all the information they require to apply for approval. Upon approval of credit application file by an RFI, it will be transmitted to the Project Management Unit for verification of its compliance with the defined criteria and specifications. The funds will be released when the Project Management Unit gives its compliance approval, prepares the transfer order, and sends it to the Ministry of the Economy and Finance. The latter will in turn prepare a transfer voucher for the beneficiary IFR. The RFIs shall follow up the credit beneficiaries, and prepare quarterly credit control and monitoring reports. The project will in turn undertake regular monitoring visits. The foreign exchange risks will be borne by the Government. 5.2.8 A Credit Guarantee Fund will be set up; its resources will come regularly from part of the interests paid on loans granted to the beneficiary population. The guarantee fund could also get its resources from the Government or other donors. A committee will therefore be set up to manage the guarantee fund. The committee will comprise representatives from the

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following: the Ministry of the Economy and Finance, the Ministry of Agriculture, RFIs, farmer organizations and the project. The Government will define modalities for organizing and managing the fund, and submit them to the ADF for prior approval. The fund will be used only after all possible remedies have been exhausted. The guarantee will consist of the savings of beneficiaries, the joint and several surety of members of the group, and the conventional guarantees (collateral, mortgage). 5.3 Implementation and Supervision Schedules

Project activities will cover a period of 6 years, from July 2001 (see Annex 3). This period is justified because the project will start with a preparatory phase, consisting in identifying the new villages to be supervised in the two provinces, and in establishing the local development and participatory approaches. During this period, planning workshops will be organized, and the skills and tools required for project management will be provided. This will be done with the assistance of the composite team (see paragraph 4.5.14). Given its complexity, the project will be closely monitored by the ADF and the Government. Three supervision missions will be organized by the Bank within the year. Consultations with the other donors concerned and the project will be organized during these missions. The preparatory phase will cover one year. Annex 3 summarizes the provisional implementation schedule. 5.4 Procurement Arrangements 5.4.1 The procurement arrangements are summarized in Table 5.1 below. All ADF-financed procurements of goods, works and services will comply with Bank rules of procedure for procurement of goods, services and works or, as the case may be, with Bank rules of procedure for the use of consultants, on the basis of the appropriate standard bidding documents of the Bank.

Table 5.1 Procurement Arrangements

EXPENDITURE CATEGORIES

In UA thousand

ICB NCB NS SL A/M BF TOTAL 1. WORKS 1.1 Buildings 0.06 (0.04) 0.02 0.06 (0.04) 1.2 Water management 3.58 (1.52) 2.06 3.58 (1.52) 1.3 Developments F/P 0.02 (0.01) 0.49 (0.33) 0.17 0.51 (0.34) 1.4 Feeder roads 0.82 (0.57) 0.25 0.82 (0.57) 2. GOODS 2.1 Pumps & accessories 0.09 (0.09) 0.09 (0.09) 2.2 Vehicles 0.51 (0.51) 0.51 (0.51) 2.3 Other equipment 0.57 (0.57) 0.57 (0.57) 2.4 LIF 0.87 (0.87) 0.87 (0.87) 2.5 Rural credit 0.82 (0.82) 0.82 (0.82) 2.6 Operating costs 1.88 (1.40) 0.48 1.88 (1.40)

3. SERVICES 3.1 Outreach activities 2.23 (2.23) 2.23 (2.23) 3.2 Consultants 0.22 (0.22) 1.26 (1.26) 1.48 (1.48) 3.3 Training 1.74 (0.08) 0.08 (0.08) 0.53 1.98 (0.16) 4. STAFF 0.48 (0.48) 1.39 (0.15) 1.24 1.87 (0.63) Total 3.58 (3.58) 0.90 (0.62) 1.07 (1.07) 4.67 (3.01) 6.88 (5.00) 4.65 17.12 (13.28)

5.4.2 The Project Management Unit will be responsible for awarding contracts for goods and services, except goods purchased with credit. The unit has enough resources, skills, expertise and experience to satisfactorily conduct the procurements as indicated below:

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i) the consultant, NGOs, and accounting audit firms for the project will be recruited

through competitive bidding on the basis of a short list;

ii) the experts of the Project Management Unit will be recruited by competitive bidding through a recruitment firm;

iii) the contract for the supply of pumps, engines and accessories will be awarded

through limited international competitive bidding. This procedure is justified by the specific type of equipment required, since Burkina Faso has only a few known trademarks. The equipment will be procured by tranche and by bid package to ensure standardization. Moreover, the value of each procurement will be small;

iv) civil works for the construction of hydraulic infrastructure, the development of

feeder roads, and agricultural water supply will be awarded through international competitive bidding;

v) civil works for the construction of buildings, with each contract not exceeding

UA 60,000, will be awarded in compliance with national competitive bidding procedures taking into account the fact that the sites are scattered. There are enough enterprises in Burkina Faso to guarantee competition. Furthermore, the works will be undertaken in several locations at the same time;

vi) pastoral and forestry development works will be done on force account by the

project with the assistance of the Ministry of the Environment and Water Resources, given its experience, and competence, as well as its equipment. It intervened efficiently during the first phase. In fact, the Ministry has an experienced technical team established during the natural forest development project with UNDP assistance. The envisaged works will be done within schedule and at reasonable prices;

vii) contracts for the supply of equipment, furniture and other materials not

exceeding UA 50,000 each will be awarded through national shopping. There are enough local suppliers and agents of foreign firms in Burkina Faso to guarantee competitive prices;

viii) contracts for vehicles not exceeding UA 200,000 each will be awarded through

national competitive bidding. There are enough local suppliers and agents of foreign firms in Burkina Faso to guarantee competitive prices;

ix) contracts for minor equipment and supplies for the running of the Project

Management Unit not exceeding UA 20,000 each will be awarded through national shopping. There are enough local suppliers and agents of foreign firms in Burkina Faso to guarantee competitive prices;

x) training in management for project employees will be entrusted to AMTA by

direct selection because the institution alone has the required expertise. Moreover, it has recognized and appreciated experience and competence;

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xi) the goods, services and works for the Rural Credit Fund will be procured in compliance with well-established commercial practices acceptable to the ADF;

xii) the goods, services and works for the Local Investment Fund will be procured

in compliance with procedures to be defined in the Procedures Manual and submitted to the Bank for prior approval;

xiii) the engineering design, studies on water tariffs, and maintenance of water

points, as well as the inspection and supervision of water management infrastructure works will be awarded to the Hydraulics Department in the Ministry of the Environment and Water Resources by direct selection on account of its recognized and appreciated experience and competence, its equipment, and its competitive prices. The earmarked resources will be used in financing the operating expenses arising from the project;

xiv) the livestock component will be implemented on force account by the Ministry

of Animal Resources in view of its experience, competence, and adequate equipment. This Ministry carried out the operations during the first phase, and has specialized services (Regional directorates, CNIA, Veterinary Laboratory in Kadiogo and the village animal improvement project);

xv) the agricultural component will be implemented on force account by the

Ministry of Agriculture in view of its experience, competence and equipment. This ministry has specialized services which worked efficiently during the first phase; they include the regional and provincial directorates, BUNASOLS, UGES, etc;

xvi) research work on the identification of technical procedures, animal health,

improvement of soil fertility and agro-forestry will be carried out by the research institutes mentioned in Annex 7 and supervised by CNRST because these institutions alone have the required expertise;

xvii) the coordination of the STD and AIDS control programme will be entrusted to

the National AIDS Control Committee by direct selection in view of its recognized and appreciated experience, competence and organization.

5.4.3 The text of a General Procurement Information Note has been adopted with the Government of Burkina Faso, and will be issued for publication in Development Business upon approval of the loan proposal by the Board of Directors. 5.4.4 The following documents will be submitted to the Bank for consideration and approval before publication: (i) Specific Procurement Information Notes; (ii) Bidding documents or letters of invitation to Consultants; iii) Evaluation reports on bids submitted by enterprises and suppliers or proposals by Consultants with recommendations on the award of contracts. To that end, the prior opinion of the Bank on the technical analysis report (is) or (is not) required; (iv) Draft contracts, where they have been modified as the drafts are incorporated in the bidding documents.

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5.5 Disbursement Arrangements

The LIF and credit component funds will be disbursed through accounts opened for that purpose in BCEAO, and by annual tranche on the basis of an annual programme approved beforehand by the Government and ADF. Subsequent disbursements will be authorized after justification of at least 50% of the preceding expenditure. To that end, the disbursement request should be accompanied by the following documents: instruction sheet with information on the sub-project, data sheet with the expected outcomes of the sub-project (production, turnover, expenses, financial performance beforehand after repayment of the loan, management ratios), payment vouchers prepared by the Ministry of the Economy and Finance for CVGT and CIVGT (in the case of LIF) and (mutual benefit) financial institutions as regards credit: statements of the accounts which receive LIF and credit fund resources opened in BCEAO and prepared by this very institution, grant protocol signed by the beneficiary and the project, loan contract signed by the beneficiary and the credit institution, including the repayment of schedule and the authenticated guarantee certificates, report on LIF and credit activities prepared by the project, monthly reports prepared by each financial institution, in addition to the general credit status. The report should mention the names of all the beneficiaries who obtained credits during period of the report. As regards the operating expenses of the unit, disbursement requests for the rolling stock, as well as repayment and direct payments will be submitted to ADF, which will approve them in accordance with the usual procedures. 5.6 Monitoring and Evaluation 5.6.1 There will be two types of monitoring and evaluation: (i) permanent monitoring and evaluation conducted by the Project Management Unit in collaboration with the consulting firm or NGO responsible for outreach activities and sensitization; and (ii) external monitoring and evaluation conducted by the Studies and Planning Department of the Ministry of Agriculture. The permanent monitoring and evaluation group will comprise a composite team, to which will be added some senior staff of this project responsible for monitoring and evaluation. The group will conduct socio-economic surveys at project start-up to determine the baseline case. The internal monitoring and evaluation will be based on performance indicators to be defined by the composite team. 5.6.2 The external monitoring and evaluation will be responsible for monitoring the project and ensuring consistency between national and project objectives, as well as proposing adjustments, if necessary. The team responsible for external evaluation will comprise at least four national specialist officers. To that end, the project will provide assistance to the Studies and Planning Department of the Ministry of Agriculture to enable it to regularly and always accomplish its mission. The two teams responsible for monitoring and evaluation will prepare a monitoring and evaluation report, copies of which will be sent to ADF and the other donors concerned. 5.6.3 There will also be a mid-term review after three years of project implementation, and a final review. The conclusions and recommendations of these two reviews will be submitted to ADF for approval after validation by their respective workshops; the results of these workshops will be communicated to the other donors. Consulting firms will be recruited to conduct these reviews, and independent audit firms to audit the project accounts.

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5.7 Financial and Audit Reports 5.7.1 The project accounts will be kept by the Project Management Unit. The unit will keep financial and cost accounting appropriate to the project, and will organize budget monitoring based on the SYSCOA system. To that end, the project will establish a financial and accounting management system; a consultant will be recruited for that purpose. The Project Management Unit will keep separate accounts for ADF-financed operations. This arrangement also concerns the resources of the credit and LIF components. Agencies, to be bound by agreement to the project, will open separate accounts for operations financed under the project. 5.7.2 Project accounts will be subject to usual controls by Government services. Moreover, the different above-mentioned accounts and project accounts will be audited once each year by an independent audit firm financed by the project. The terms of reference of the independent firm will be reviewed by the ADF taking into account the guidelines defined by its internal audit service. The audit expenses will be covered by proceeds from the ADF loan. The financial statements of CVGTs and CIVGTs will also be audited by the same independent firm. 5.8 Coordination with other Donors 5.8.1 Phase II of the project has been designed as a permanent consultation framework that can improve the living conditions of the population in Bazèga and Kadiogo. It is within this context that consultations were organized during project preparation and appraisal with the various development partners, the population, NGOs, senior staff of the regions concerned and the authorities. Meetings were organized with the World Bank, the European Union, FAO, UNDP, UNICEF, WHO, WFP, GTZ, AFD, the Embassy of the Kingdom of Denmark, the Embassy of the Kingdom of the Netherlands and NGOs such as the Catholic Relief Service (CRS). These meetings revealed the gravity of problems faced in rural development and the project area, drew relevant lessons from the experiences of the other donors and proposed appropriate solutions to the Government. They arrived at the following conclusions: to avoid duplication and loss in the second national land management programme, it was agreed that ADF should continue to finance project activities in Bazéga and Kadiogo. All the donors emphasized that the present project should adopt the decentralized and participatory rural development approach. Coordination meetings between the Bank and donors of the project will be organized regularly. The second mission to Burkina Faso in December 2000 gave the opportunity to redefine the strategy and scope of the project with all the aforementioned donors. 5.8.2 In Burkina Faso, aid is coordinated by the General Directorate of Cooperation of the Ministry of the Economy and Finance. It organizes frequent meetings for donors present in Ouagadougou. Aid is also coordinated within the framework of the Consultative Group and a sectoral round table organized to better define development activities and avoid duplication of operators in the various sectors. There is a donor group which collaborates with the Government. The Bank is associated with donor activities in Burkina Faso through contracts concluded with UNDP. There will be regular exchange of correspondence with AFD, the Embassy of the Kingdom of Netherlands, the Kingdom of Denmark, and the Swiss Cooperation.

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6. PROJECT SUSTAINABILITY AND RISKS 6.1 Recurrent Expenses At project completion, the recurrent expenses are estimated at UA 1.0 million exclusive of maintenance costs for water points, borne regularly by the population. Recurrent expenses will be covered after project completion. In fact, maintenance of the development works will be borne by the population through the GVGTs, CIVGTs and SSCs. Each water point will be completely managed by a specific SSC. The SSc will have CFAF 150,000 at the time it is set up. The amount will come from contributions by beneficiaries of the water point. It will be used for maintaining the infrastructure concerned. The funds will be supplemented with proceeds from the sale of water. The transfer of responsibilities from the unit to the groups will significantly reduce recurrent expenses. A significant increase in the purchasing power of the producers should guarantee maintenance of the infrastructure. Outreach and sensitization activities will be taken over by the population at project completion. The same will apply to supervision, extension services, research and development and training. Through the participatory approach and improvement of local capacities, the population will develop their self-management and autonomy capacity. At project completion, the staff will be placed at the disposal of the public service or dismissed. The marketing units (cattle market and milk collection centres) will be responsible for their own maintenance, thanks to their community spirit, the improvement of their management capacity, and the cash surplus that will be generated. 6.2 Project Sustainability 6.2.1 Sustainability of project activities is guaranteed because the population will be more responsible for managing their activities. Organizational and institutional capacities will be developed through training of the population, gradual transfer of technical skills and strengthening of farmer organizations. Production will be intensified without disrupting the balance of ecosystems because the envisaged activities will protect and develop natural resources. Health and environmental hygiene activities will reduce the incidence of water-borne diseases and ensure better sanitation in the immediate surroundings of water points. 6.2.2 Decentralization and State divestiture in favour of the private sector and farmer organizations will also encourage producers to organize themselves so as to further engage in trade which requires a good understanding of market mechanisms. Through contributions, harvests due to the sale of water, the water points maintenance system totally guaranteed by basic committee and the marketing of products, the project will be able to solve management and maintenance problems generally encountered in rural areas and to guarantee regular and adequate water supply for the population and cattle. The credit system will continue to satisfy the economic initiatives of stockbreeders and agro-pastoralists. 6.3 Major Risks and Mitigating Measures 6.3.1 Water is a limiting factor for agriculture and stockbreeding, because it controls many other essential factors such as feeding and watering. The risk of lack of water is reduced, because the construction of water points would guarantee water supply throughout the year, compensate for the inadequate rainfall and allow for fodder production. On the other hand, the strengthening of local capacities would facilitate the management and maintenance of water points, as well as ensure that the population accept prophylactic public health measures.

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6.3.2 The poor soils, over-grazing and bush fires are potential constraints on the development of agriculture and stockbreeding. However, these risks are reduced by works to maintain, restore soil fertility, and reclaim lands, as well as pastoral development, revitalization of SSCs and the establishment of the environment observatory. Improvement of the agro-sylvo pastoral potential should accommodate the demographic pressure. Furthermore, an increase in the purchasing power of producers should enable them to maintain the infrastructure and repay the credit. 6.3.3 The introduction of new breeds should not pose any problems since the selected breeds are known in Burkina Faso. Moreover, the Government exercises strict control over the import of foreign breeds. 7. PROJECT BENEFITS 7.1 Financial Analysis 7.1.1 The financial analysis is based farm models the main characteristics of which are presented in paragraph 7.1.1 of Volume 2 of this report. The objective is to develop and transform as many traditional and improved farms as possible into modern farms. An analysis of the various operating account estimates shows that modern farms would make substantial profits at full development (see Annex 6). In fact, in the case of farm holdings, the profit increases from CFAF 57,260 to CFAF 661,540. As regards livestock, the profit increases from CFAF 1,320,320 to CFAF 6,387,855 for cattle. It increases from CFAF 24,700 to CFAF 301,800 for sheep, from CFAF 39,640 to CFAF 125,880 for goats, from CFAF 644,050 to CFAF 1,420,000 for pigs and from CFAF 66,200 to CFAF 102,700 for poultry. Cattle and sheep fattening would generate a net income of CFAF 5.2 million for cattle and CFAF 1.5 million for sheep. The net income generated by the cereal mills and cereal banks are CFAF 189 and CFAF 83/kg respectively. Details of the operating accounts of the various farm models are presented in Annex 6. 7.1.2 The net income from a stere of wood from a developed natural village forest stands at CFAF 2,200. This income is broken down as follows: CFAF 1,100 for the woodcutter, CFAF 200 for the working capital of the SSC responsible for developing the forest, CFAF 300 for the charges to be paid to the State, and CFAF 600 for the forest development fund. 7.2 Economic Analysis 7.2.1 As regards the economic analysis, the life of the project has been estimated at 20 years. The economic analysis is based on a comparison of the situation «without project» with the situation «with project». All project expenses as well as the operating expenses of producers have been taken into account. They are estimated on the basis of economic prices. Customs duties have been excluded. However, family labour used in the farms has not been assessed. As regards project benefits, account has been taken of cereals, vegetable crops, tree products, poultry, and animal products. Fish and honey are not considered. Since livestock and cashew nuts are produced mainly for exports, their economic prices are equivalent to their export prices. Since the other products are mainly intended for local consumption, their prices are those of the import parity adjusted in the farm. From this analysis, the rate of return stands at 24.76 %. The rate is satisfactory because it is above the marginal efficiency of capital which could stand at 15 % in Burkina Faso.

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7.2.2 In the short term, the project will be exempted from taxes and duties, and will not have any significant impact on State fiscal revenues. However, State revenues will eventually increase as a result of an increase in taxes and duties collected. In fact, the forest tax would contribute to the State budget. With the intensification of agriculture and genetic improvement of cattle, there would be an increase in exports of agricultural and livestock products, as well as in taxes and duties collected from the marketing of project products. Furthermore, increased milk production would contribute to reducing imports estimated at CFAF 8 billion per year. The project would therefore have a positive impact on public finance since the selected farms and milk factories would be self-financing after project implementation. 7.3 Social Impact Analysis 7.3.1 Women will be involved in project implementation at all levels (production, supervision, outreach activities, project management unit). They will participate in training, literacy, post-literacy, technical education, training in farm management and land use. They will benefit from decentralized credit facilities which would enable them to finance gainful activities and increase the family income, as well as generate investments conducive to further integration into the market economy. 7.3.2 The project will also contribute to improvement of the health, nutritional and education status of the population. It is intended for producers who receive assistance from the State regularly. The project would reduce the negative impact of such assistance on public finance because the stockbreeders would gradually control the organization and management of their lands. Intensive production would promote the substitution of imported products, and this would improve the country’s trade balance. The project will also contribute to the self-financing of the forest sector through the forest development fund. 7.3.3 The project will contribute to poverty reduction among the Bazéga and Kadiogo population. In fact, intensification of production would increase the incomes of producers and improve their purchasing power. Such improvement would enable households to cover their food expenses, which are currently 32% below the vital minimum calorie intake. Furthermore, women involved in agro-sylvo-pastoral operations would also earn income above the poverty line. The project will also contribute to job creation upstream and downstream, and to the involvement of several economic operators (suppliers of factors of production, executing agencies, traders and people processing project products); this should distribute the additional income from the project and reduce the rural exodus of youths whose situation would be improves. The youths would be involved in agricultural and livestock activities. 7.4 Sensitivity Analysis

The rate of return stands at 22.88 % when expenses increase by 10% and at 20.96% when income is reduced by 10%. These sensitivity tests show that the project is viable despite the increase in expenses and decline in income by 10%. However, it is sensitive to an increase in costs and a decline in income.

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8. CONCLUSIONS AND RECOMMENDATIONS 8.1 Conclusions

Increased production following project implementation will contribute to reducing poverty in the project area and enhancing food security. It will also have a positive impact, as it would increase the per capita income and purchasing power. This situation would substantially change the structure of household expenses. Project implementation would also create new permanent and temporary jobs, and thereby reduce the rural exodus of youths to the urban areas. The project will also promote the emergence of women and their integration into economic circuits. The project will also serve as a coherent framework with activities geared towards local development and aimed at conserving, preserving and developing natural resources. In its current design, the project is technically possible, as well as financially and economically viable. The economic rate of return stands at 24.76 %. 8.2 Recommendations and Loan Approval Conditions

In view of the foregoing, it is recommended that an ADF loan not exceeding UA 15.00 million be granted to Burkina Faso. The loan will be subject to the following conditions:

a) Conditions precedent to effectiveness of the loan agreement:

i) Effectiveness of the loan agreement will be subject to fulfilment, by the Borrower, of the conditions stipulated in Section 5.0.1 of the General Conditions.

b) Conditions precedent to first disbursement:

i) Provide the Fund with evidence of the establishment of the project

management unit (see paragraph 5.1.1 and 4.5.20) ; ii) Provide the Fund with evidence of having opened (a) two accounts

in BCEAO to receive the Local Investment Fund (LIF) resources and the loan resources respectively (b) an operations account in a commercial bank to receive the operating resources of the project (c) an account in the Treasury to receive the Government’s counterpart contribution, and (d) three accounts in commercial banks the first of which will receive the credit funds to be onlent to Rural Financial Institution (RFI), the second to receive repayments of loans granted to financial institutions and the third to receive all the resources of the guarantee fund (see paragraph 5.2.5) ;

c) Other Conditions:

In addition, the Borrower shall:

i) Communicate to the Fund, not later than 31 December 2002, the agreements concluded between the project and the partner services

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responsible for implementing specific project components as indicated in Annex 7 (see paragraph 5.2.1) ;

ii) Submit to the Fund, not more than twelve (12) months following the signing of the Loan Agreement, the action programmes for environmental management, as well as the control and monitoring of environmental impacts (see paragraph 4.5.9);

iii) Submit to the Fund, not more than six (6) months following the signing of the Loan Agreement, the procedures manual defining the eligibility criteria for the use of the local investment fund (see paragraph 4.5.16);

iv) Submit to the Fund, as they are signed, the onlending agreements concluded with the rural financial institutions (see paragraph 5.2.4).

ANNEX 1

BURKINA FASO DECENTRALISED RURAL DEVELOPMENT AND PARTICIPATIVE PROJECT IN THE PROVINCES OF BAZÉGA AND KADIOGO

This map has been drawn by the African Development Bank Group exclusively for the use of readers of the report to which it is attached. The names used and the borders shown do not imply on the part of the Bank Group and its members any judgement concerning the legal status of a territory nor any approval or acceptance of these borders.

International boundary

Provincial Boundary

National Capital Provincial Capital Railway Line Road

ANNEX 2

DECENTRALISED AND PARTICIPATORY RURAL DEVELOP. PROJECT

NR Development& Management

OPA Restructuring& Outreach Activities

Ext. Offices and R &DEnvironment

ControlMarketing Credit and Savings

Input Supply Administration andFinance

Specialized AgenciesConsult. Firms/NGO/RFI

CVGT/CIVGTOPA

MarketingOPASupply

BURKINA FASO

Management Unit

High Commission

Secretary-General

Technical Committee

National CoordinationCommittee

Provinciaul CoordinationCommittee

Municipal CoordinationCommittee

MINISTRY OFAGRICULTURE

ORGANIZATION CHART

ANNEX 3 BURKINA – FASO

Decentralised Rural Development and Participative Project in the Provinces of Bazéga and Kadiogo Implementation Schedule

Activities / Actions Initiators Start-Up Duration

Board Approval ADF April 2001 5 days Staff Recruitment Government August 2001 3 months Agreements with specialised agencies Government August 2001 1 months Initial disbursement Government/ADF September 2001 15 months Procurement of equipment CGP September 2001 3 days Preparation of the environmental management plan CGP/OPE December 2001 2 months Recruitment of Consulting Firms and NGOs for community development Government December 2001 3 months Participative analyses CGP/Offices/ONG January 2002 6 months Installation of infrastructure CGP March 2002 5 years Planning workshop : preparation of a logical framework for operation , overall operational planning and the operational plan for the first year.

CGP April 2002 1 week

Introduction of the credit and local investment fund CGP April 2002 5 years Development and management of natural resources CGP/ Offices / ONG May 2002 5 years Training of producers and project officers CGP/ Offices / ONG May 2002 5 years Audit of accounts Consulting Firm August 2002 5 years Mid-term evaluation and workshop CGP/ Consulting Firm /ONG January 2006 70 days Final evaluation and workshop CGP/ Consulting Firm /ONG January 2006 70 days

ANNEX 4 BURKINA FASO

DECENTRALISED RURAL DEVELOPMENT AND PARTICIPATIVE PROJECT IN THE PROVINCES OF BAZÉGA AND KADIOGO PROVISIONAL LIST OF GOODS AND SERVICES

BILLION CFA F MILLION UA DONORS CATEGORIES F.E. L.C. TOTAL F.E. L.C. TOTAL ADF GVT BNF

1. Goods 1.1 Pumps and accessories 0.08 - 0.08 0.09 - 0.09 0.09 - - 1.2 Vehicles 0.51 - 0.51 0.51 - 0.51 0.51 - - 1.3 Other equipment 0.48 - 0.48 0.57 - 0.57 0.57 - -

2. Works 2.1 Buildings 0.04 0.02 0.06 0.04 0.02 0.06 0.05 0.01 - 2.2 Water infrastructure 2.46 0.83 3.29 2.67 0.91 3.58 1.74 0.38 1.46 2.3 Forest and pastoral management 0.31 0.16 0.47 0.33 0.18 0.51 0.36 0.15 0.03 2.4 Rural Tracks 0.30 0.45 0.75 0.33 0.49 0.82 0.57 0.25 -

3. Service 3.1 IEC community development and sensitization 1.12 0.24 1.36 1.21 0.27 1.48 1.48 - - 3.2 Consultant 2.02 0.10 2.12 2.20 0.11 2.31 2.31 - -

4. Operation 4.1 Project management unit 0.16 0.20 0.36 0.17 0.22 0.39 0.27 0.12 - 4.2 Other expenditures 0.75 0.62 1.37 0.83 0.66 1.49 1.13 0.36 -

5. Miscellaneous 5.1 Training 1.06 0.86 1.91 0.93 0.93 2.08 1.08 0.47 - 5.2 Local investment fund 0.48 0.32 0.80 0.52 0.35 0.87 1.50 - - 5.3 Rural credit 0.45 0.30 0.75 0.49 0.33 0.82 1.50 - - 5.4 Personnel 1.61 1.61 - 1.75 1.75 0.85 1.2 -

Base cost 10.48 8.06 18.54 11.34 8.88 17.36 13.21 2.62 1.54 Physical contingencies 0.65 0.46 1.19 0.49 0.51 1.00 0.68 0.16 0.15 Price escalation 0.68 1.06 1.74 0.60 1.16 1.88 1.10 0.57 0.21 Total project cost 10.09 9.51 19.60 10.42 9.82 20.24 15.00 3.34 1.90

ANNEX 5

BURKINA FASO DECENTRALISED RURAL DEVELOPMENT AND PARTICIPATIVE PROJECT IN THE PROVINCES OF

BAZEGA AND KADIOGO

Provisional Operating Accounts CFAF

Operations Products Charges Recipients

1. Farming Unit - Traditional - Traditional A - Modern

185,560 776,044 1,088,249

128,300 288,000 416,400

57,260 496,044 661,540

2. Cattle Farming - Traditional - Traditional A - Modern

2,962,100 4,837,800 21,759,500

1,641,780 2,084,915 15,371,645

1,320,320 2,852,885 6,387,855

3 Sheep Farming c Traditional

Traditional A Modern

318,000 548,000 1,390,000

293,300 351,805 1,088,200

24,700 196,195 301,800

4 Goat Farming

c Traditional Traditional A Modern

68,800 109,550 296,350

29,160 44,050 170,470

39,640 65,500 125,880

5 Pork Farming

c Traditional Traditional A Modern

688,800 1,176,000 2,196,000

44,750 161,000 770,000

644,050 1,015,000 1,420,000

6 Poultry Farming Embouc Traditional Traditional A

71,000 116,000

800 13,300

66,200 102,700

7 Miscelaneous

c Cattle fattening Sheep fattening Dairy Cereal mill Cereal bank

17,400,000 4,000,000 153,573,200 317 190

12,173,963 2,488,256 90,901,140 128 107

5,226,037 1,511,744 62,672,060 189 83

N,B, : The characteristics of these farm uits are available in volume 2 of the report.

ANNEX 6 BURKINA FASO

Decentralised Rural Development and Participative Project in the Provinces of Bazéga and Kadiogo

APPRAISAL REPORT ECONOMIC RATE OF RETURN

MILLION CFA F

Years AdditionalEarnings

-------------Costs-------------- CASH FLOW

Investments Farm Units Total

Sales & Renewals Total Normal Earnings

-10% invest, +10%

Charges +10%

H1 H2 H3 H4 2001 381 381 2212 1753 3965 -3584 -3622,1 -3805,2 -3759,32002 1250 1250 3717 1973 5690 -4440 -4565 -4811,7 -4637,32003 3980 3980 1902 2001 3563 417 19 226,8 250,92004 3520 3520 1275 1661 2775 745 393 617,5 5952005 3840 3840 365 1500 1715 2125 1741 2088,5 19902006 4530 4530 156 1350 1506 3024 2571 3008,4 28892007 4750 4750 163 1350 1513 3237 2762 3220,7 31022008 4960 4960 1350 1350 3610 3114 3610 34752009 5100 5100 1350 1350 3750 3240 3750 36152010 5100 5100 1350 1350 3750 3240 3750 36152011 5100 5100 1350 1350 3750 3240 3750 36152012 5100 5100 1350 1350 3750 3240 3750 36152013 5100 5100 91 1350 1441 3659 3149 3649,9 35242014 5100 5100 188 1350 1538 3562 3052 3543,2 34272015 5100 5100 1350 1350 3750 3240 3750 36152016 5100 5100 106 1350 1456 3644 3134 3633,4 35092017 5100 5100 28 1350 1378 3722 3212 3719,2 35872018 5100 5100 103 1350 1453 3647 3137 3636,7 35122019 5100 5100 1350 1350 3750 3240 3750 36152020 5100 5100 1350 0 5100 4590 5100 5100

T,R,I,E, 24,7625 20,9864 23,0566 22,8803 Econilic internal rate

of return zipv1,1

ANNEX 7

Burkina Faso DECENTRALISED RURAL DEVELOPMENT AND PARTICIPATIVE PROJECT IN THE PROVINCES

OF BAZEGA AND KADIOGO

Institutions Participating in the Project

TITLES SEVICES

• Ministry of the Environment and Water (MEE) • Ministry of Animal Resources (M.RA) • Ministry of Agriculture (M.AGRI) • Ministry of Health • INERA • CNSF • CIRAF • CNIA • CIPI / ILRI • UGFS • BUNASOLS • IFDC-AFRIQUE • CNRST • CONAGESE • AMTA

- Fish farming - Forest management - Implementation study and control/supervision of

water infrastructure works - Study on Water Tariffs and maintenance of water

points - Implementation of attenuate ecosystem balances. - Pastoral management - Agro-breeder Extension - Genetic improvement - Agricultural Extension - Soil fertility enrichment - Health component co-ordination

- Agricultural Research

- Forest seed production

- Research for forest seed production

- Research on Genetic Improvement

- Research on animal health

- Rearch on soil fertility enrichment and integration of agriculture-breeding

- Coordination of research activities .

- Monitoring, control and management of

environmental impact assessments

- Executives training in management.

ANNEX 8 BURKINA FASO- DECENTRALISED RURAL DEVELOPMENT AND PARTICIPATIVE Project IN THE PROVINCE OF BAZEGA AND KADIOGO

SUMMARY TABLE OF ACTIVE BANK GROUP OPERATIONS (Amounts in thousand UA) Date Date of Date of entry

into force Date de Net

commitmentAmount disbursed

Percent disbursed

NB Srce Sce Inst S sect Project Title of approval Signature completion

1 ADF F PL 1 AG Bagré Dam Project 15-Jun-89 17-Aug-89 15-Mar-90 31-Dec-96 33.18 25.87 78.0% 2 ADF T ET 1 AG Piéla-Bilanga Rural Development Study 25-May-92 12-May-93 21-Sep-94 31-Dec-96 0.46 0.36 78.2% 3 ADF F PL 1 AG Piéla-Bilanga Rural Development Project 25-May-92 30-Dec-93 21-Aug-94 31-Dec-99 9.44 6.20 65.7% 4 ADF F PL 1 AG BAZEGA Natural Resources Management 24-Nov-93 30-Dec-93 13-Feb-95 31-Jan-01 8.50 8.49 99.9% 5 ADF F PL 1 AG Rural Water Project 24-Nov-93 30-Dec-93 20-Feb-95 31-Dec-99 8.52 3.26 38.3% 6 ADF T ET 1 AG Zone DI Irrigation Scheme Study 17-Sep-97 11-Nov-97 07-Oct-98 31-Dec-00 0.82 0.27 33.2% 7 ADF T ET 1 AG 3 Provinces Rural Development Study 17-Sep-97 11-Nov-97 07-Oct-98 31-Dec-00 0.70 0.27 38.9% 8 ADF T ET 1 AG Small Dams Study 11-Mar-98 28-May-98 - 31-Dec-00 0.71 0.16 22.8% 9 ADF F PL 1 AG Soum Livestock Development Project 29-Mar-00 28-Aug-00 30-Sep-07 9.99 0.00 0.0%

AG Total 72.32 44.88 62.1% 10 ADF F PL 3 TR Road Maintenance Programme 09-Jan-97 13-Feb-97 26-Nov-97 31-Dec-02 10.00 2.64 26.4%

TR Total 10.00 2.64 26.4% 11 ADF F PL 5 PU Ziga Dam 15-Dec-97 05-Feb-98 - 31-Dec-05 4.74 - 0.0% 12 ADF T TA 5 PU Potable Water Supply and Sanitation Study 22-Mar-00 28-Aug-00 - 31-Dec-02 0.97 - 0.0%

PU Total 5.71 0.00 0.0% 13 ADF F PL 6 SO Improvement of the Quality of Primary and Secondary

Education 28-Aug-91 17-Jul-92 23-Apr-93 31-Dec-00 9.21 7.50 81.4%

14 ADF F PL 6 SO Education IV 16-Jul-97 05-Sep-97 03-Dec-98 31-Dec-02 16.50 1.52 9.2% 15 ADF F PL 7 SO Dori and Djibo Health Facilities Renovation 16-Dec-91 17-Jul-92 17-Aug-93 31-Dec-96 10.96 8.09 73.8% 16 ADF F PL 7 SO Health IIProject 06-Oct-99 - - 31-Dec-04 10.00 - 0.0% 17 ADF F PL 8 SO Poverty Programme in Municipal Areas 10-Dec-98 05-Feb-99 - 31-Dec-04 14.00 - 0.0% 18 ADF F PL 8 SO Poverty Programme in Municipal Areas 10-Dec-98 05-Feb-99 - 31-Dec-04 1.50 - 0.0%

SO Total 62.17 17.12 27.5% Grand Total 150.20 64.65 43.0%

Annex

BURKINA FASO

DECENTRALISED AND PARTICIPATIVE RURAL DEVELOPMENT PROJECT IN BAZEGA AND KADIOGO PROVINCES

CORRIGENDUM Tables 4.1., 4.2. and 4.3. of the Appraisal Report have been corrected and are presented as follows:

Table 4.1 Summary Project Cost Estimates by Component

IN CFAF MILLION IN UA MILLION COMPONENTS

F.E. L.C. Total F.E. L.C. Total % in F.E.

A. IMPROVEMENT OF PRODUCTION SYSTEMS 1,152.34 1,539.68 2,692.02 1.19 1.59 2.78 42.81 B. NATURAL RESOURCE DEVELOPMENT AND MANAGEMENT 2,662.96 2,982.52 5,645.48 2.75 3.08 5.83 47.17

C. IMPROVEMENT OF LIVING CONDITIONS 813.41 358.29 1,171.70 0.84 0.37 1.14 73.68 D.LOCAL CAPACITY BUILDING 3,679.73 1,762.40 5,442.13 3.80 1.82 5.62 67.62 E. Project MANAGEMENT 726.26 1,200.75 1,927.01 0.75 1.24 1.99 37.69 BASE COST 9,034.71 7,775.85 16,878.45 9.33 8.03 20.22 53.74 PHYSICAL CONTINGENCIES 474.49 493.86 968.35 0.49 0.51 1.00 49.00 PRICE ESCALATION 581.01 1,239.49 1,704.30 0.60 1.16 1.88 38.30 T O T A L 10,090.21 9,509.19 19,599.40 10.42 9.82 20.24 51.48

Table 4.2 Summary Cost Estimates by Expenditure Category

IN CFAF MILLION IN UA MILLION CATEGORIES

F.E. L.C. Total F.E. L.C. Total % in F.E.

1. WORKS 1,617.15 3,195.56 4,812.71 1.67 3.30 4.97 33.60 2. EQUIPMENT 1,132.97 0.00 1,132.97 1.17 0.00 1.17 100.00 3. SERVICE 3,292.39 367.97 3,660.36 3.40 0.38 3.78 89.95 4.LIF 503.54 948.98 1,452.53 0.52 0.98 1.50 34.67 5. RURAL CREDIT 474.49 978.03 1,452.53 0.49 1.01 1.50 32.67 6. TRAINING 1,045.82 271.14 1,336.96 1.08 0.28 1.36 79.41 7. OPERATING COSTS 968.35 203.35 1,171.70 1.00 0.21 1.21 82.65 8. STAFF 0.00 1,810.82 1,810.82 0.00 1.87 1.87 BASE COST 9,034.71 7,775.85 16,810.55 9.33 8.03 17.36 56.08 PHYSICAL CONTINGENCIES 474.49 493.86 968.35 0.49 0.51 1.00 49.00

PRICE ESCALATION 581.01 1,239.49 1,820.50 0.72 1.28 1.88 38.30 T O T A L 10,090.21 9,509.19 19,599.40 10.42 9.82 20.24 51.48

Table 4.3 Sources Of Finance

IN CFAF MILLION IN UA MILLION SOURCES

F.E. L.C. TOTAL F.E. L.C. TOTAL (%)

ADF 10,090.21 4,435.04 14,525.25 10.42 4.58 15.00 74.11 GVT 0.00 3,234.29 3,234.29 0.00 3.34 3.34 16.50 BENEFICIARIES 0.00 1,839.86 1,839.86 0.00 1.90 1,90 9.39 T O T A L 10,090.21 9,509.19 19,599.40 10.42 9.82 20.24 100.00