Report No. 1308-MOR FILE COPY Appraisal of a Third Agricultural Credit Project Morocco December 17, 1976 Projects Department Europe, Middie East and North Africa Regional Office FOR OFFICIAL USE ONLY Document of the Worid Bank This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS US$1.00 = DH 4.30 DH 1.00 = US$0.23 WEIGHTS AND MEASURES Metric System ABBREVIATIONS CMV Centre de Mise en Valeur (Extension Center on Irrigated Land) CNCA Caisse Nationale de Crédit Agricole HQ Headquarters DRCA Directeur Régional dl Crédit Agricole CRCA Caisse Régionale de Crédit Agricole CLCA Caisse Locale de Crédit Agricole COMAGRI Compagnie Marocaine d'Agriculture (State Agricultural Company) CT Centre de Travaux (Extension Center on Rainfed Land) MARA Ministère de l'Agriculture et de la Réforme Agraire (Agriculture Ministry) OCE Office de Commercialisation et d'Exportation (Fruit & Vegetable Exporting Agency) ORNVA Office Régional de Mise en Valeur Agricole (Regional Irrigated Land Development Agency) ORMVASM ORMVA du Souss Massa SCAM Société Coopérative Agricole Marocaine (Grain Marketing Cooperative) SNDE Société Nationale de Développement de l'Elevage (State Livestock Company) SOCAP Société de Crédit Agricole et de Prévoyance (Agricultural Credit Society) SODEA Société pour le Développement Agricole (State Agricultural Company) SOGETA Société pour la Gestion des Terres Agricoles (State Agricultural Company) SP Services Provinciaux (Provincial Offices of MARA) FISCAL YEAR CNCA September 1 - August 31 FOR OFFICIAL USE ONLY APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO CAISSE NATIONALE DE CREDIT AGRICOLE TABLE OF CONTENTS Page No. SUMMARY AND CONCLUSIONS ............................... i-ii I. INTRODUCTION .......................................... 1 II. THE AGRICULTURAL SECTOR ............................... 1 A. Description and Performance ...................... 1 B. Previous Bank Projects in the Agricultural Sector. 4 III. CAISSE NATIONALE DE CREDIT AGRICOLE ................... 4 A. Background, Organization and Personnel ........... 4 B. Lending Policies and Procedures .................. 5 C. Sources and Uses of Funds ........................ 7 D. Financial Position ............................... 8 IV. PERFORMANCE UNDER THE PREVIOUS AGRICULTURAL CREDIT PROJECTS ........................................... 9 A. First Agricultural Credit Project (Loan 433) ..... 9 B. Second Agricultural Credit Project (Loan 861, Credit 338) .................................... 10 V. THE PROJECT ........................................... 12 A. Objectives ....................................... 12 B. Description ...................................... 12 C. Cost Estimates ................................... 15 D. Financing ........................................ 17 E. Procurement ...................................... 18 F. Disbursement ..................................... 18 VI. PROJECT IMPLEMENTATION ................................ 18 A. Organization and Management ...................... 18 B. Lending Policies and Procedures .................. 19 C. Monitoring and Evaluation ........................ 21 D. Accounts and Audit ............................... 22 This document has a restricted distribution and may be ud by recipients only in the performance of their officiai duties. Its contents may not otherwise be disclosed without Wofld Bank authorisation. TABLE OF CONTENTS (Continued) Page No. VII. BENEFITS AND JUSTIFICATION .................... 22 A. Production and Marketing ......................... 22 B. Financial Benefits ..... .......................... 23 C. Economic Benefits ................................. 23 VIII. AGREEMENTS REACHED AND RECOMMENDATIONS ................ 27 ANNEXES 1. The Agricultural Sector Appendix 1.1 Mechanization and Employment Appendix 1.2 Agricultural Marketing 2. Caisse Nationale de Credit Agricole 3. Performance under the Previous Agricultural Credit Projects 4. Representative Farm Models Model 1 Well Drilling and Pump Model 2 Two Draft Animals and Basic Agricultural Implements Model 3 Two In-calf Heifers and a Stable Model 4 Four In-calf Heifers and a Stable Model 5 Combine Harvester Model 6 Tractor and Land Preparation Equipment Model 7 Plantation and Maintenance of Citrus Orchard Model 8 Well Drilling and Pump 5. CNCA Future Lending Program and Project Cost 6. Project Cash Flow Statement 7. Estimated Schedule of IBRD Disbursements 8. Monitoring and Evaluation 9. Research Program in Vegetable Cultivation (Massa Irrigation System) Appendix 9.1 Terms of Reference 10. Economic Analysis MAPS IBRD 10682R Morocco IBRD 12319 CNCA Branch Offices APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO CAISSE NATIONALE DE CREDIT AGRICOLE SUMMARY AND CONCLUSIONS i. Agriculture provides about 25% of Morocco's GDP and employs about half of the labor force. Agricultural exports account for about 25% of total exports. The main objectives of the Government during the Third Plan (1973- 77) are to improve the trade balance of agricultural products, to raise farm incomes and to improve distribution of the growth of wealth through the Agrarian Reform Program and through a better balance of Government support to farmers. The main obstacles have been the lack of qualified technical personnel and the relatively limited scope of the Agrarian Reform Program. The Project would support these objectives and would attempt to reduce these obstacles. ii. Agricultural credit is provided by the Caisse Nationale de Credit Agricole (CNCA). Credit to medium/large-sized farmers, farmers' associations, Cooperatives and companies is provided by CNCA Headquarters (HQ) and by the 24 Caisses Regionales de Credit Agricole (CRCAs); credit to small/medium- sized farmers is provided by the 86 Caisses Locales de Credit Agricole (CLCAs). CNCA is well-managed and is a very effective and independent credit institution. iii. Bank/IDA involvement in Agricultural Credit in Morocco started with the First Agricultural Credit Project (Loan 433-MOR for US$10 million, effective in February 1966 and fully disbursed by September 1969) whose performance was not without problems; the main impact of the Project was the resulting improvement in CNCA's management and operations. The Second Agri- cultural Credit Project (Loan/Credit 861/338 for US$34 million, effective in February 1973 and fully disbursed by May 1976) financed CNCA lending for 1973-76 to medium and large farmers for investments on grain farms, citrus plantations, winter vegetable farms and livestock farms and marketing facili- ties. Project implementation started slowly, due to delays in effectiveness and unavailability of IDA funds and remained behind schedule until the summer of 1975. The impact of the Second Project on CNCA was overall positive, especially on the institutional side. iv. This report appraises a Third Agricultural Credit Project for which a Bank Loan to CNCA of US$35 million equivalent is proposed. The Project would support a two-and-a-half year lending program for on-farm development of small, medium and large farmers and of Cooperatives and farmers' asso- ciations. The Third Project would not only aim at increasing agricultural production and at further expanding CNCA's capability, like the first two - ii - Projects, but it would also contribute to the improvement of the income of small farmers and to the strengthening of Cooperatives and associations in support of the Agrarian Reform Program. Of the estimated 350,000 subborrowers, 40% (140,000 farmers) would be below the absolute poverty level of US$1050 per family and 34% (120,000 farmers) would never have had access to credit before. The Project would also include some technical assistance to CNCA and to the Souss-Massa land development agency. v. The total cost of the Third Agricultural Credit Project is esti- mated at about US$315.3 million equivalent, of which 34.4% would be in foreign exchange. Financing of investments would come from the following sources: Subborrowers' contributions (28.7%), Government grants (3.3%), CNCA own funds (47.1%), IBRD Loan (11.1%) and a loan from the Arab Fund for Economic and Social Development for US$31 million equivalent (9.8%). The Bank Loan would refinance only loans to small/medium-sized farmers, Cooperatives and farmers' associations, while the Arab Fund loan would refinance only loans to medium/large-sized farmers. Together the Bank and the Arab Fund loans would meet the financial gap of CNCA until August 1979. vi. Existing CNCA lending procedures and norms are generally adequate but would be improved by modifying lending provisions to Cooperatives in order to provide them with a sounder financial structure. Medium-term interest rates would be increased from 6.5% to about 7.7% p.a. for CLCA borrowers and from 7% to 8.5% p.a. for Cooperatives and associations. Interest rates for HQ/CRCA borrowers at 8.5% p.a. are in line with interest rates in other sectors of the economy, and are positive in real terms; thus they would be maintained. All interest rates would be reviewed annually on the basis of forecast income and expenses so that HQ/CRCA operations would be profitable and that the loss of the CLCAs (paid by an operating subsidy from the Govern- ment) would be kept within reasonable limits. CNCA would set up an adequate monitoring and evaluation system. vii. The financial rates of return of subprojects would range between 14% and 25%. The overall economic rate of return would be 29%. Substantial employment benefits (at least 40,000 man years) would be generated and farmers' access to credit would be improved. With assurances obtained from CNCA and the Moroccan Government during negotiations, the Project would be suitable for an IBRD Loan to CNCA to US$35 million for 13 years including a grace period of three years. APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO I. INTRODUCTION 1.01 The Government of Morocco and the Caisse Nationale de Credit Agricole (CNCA) have requested a Bank Loan to help finance agricultural credit for investménts by small, medium and large individual farmers, Agrarian Reform Cooperatives, farmers' associations for mechanization and regional land development agencies and provincial offices of the Ministry of Agriculture (for farmers under their supervision) for the period between January 1977 and August 1979. The Project would also include some technical assistance to CNCA and to the land development agency for the Souss-Massa region (ORMVASM). The Project would also be financed by a loan from the Arab Fund for Economic and Social Development. The Borrower for the Bank Loan would be CNCA. CNCA is already the Borrower under the First Agricultural Credit Project (Loan 433-MOR), and under the Second Agricultural Credit Project (Credit 338-MOR and Loan 861-MOR). 1.02 The total Project cost would be $315.3 million with a foreign ex- change cost estimated at $108.5 million. The requested Loan of $35 million would cover part of the financing gap of CNCA during the period under consid- eration. The balance of the Project cost would be financed by subborrowers' contributions, CNCA's own funds and Government grants (almost exclusively for Cooperatives and farmers' associations) and by the Arab Fund loan. 1.03 The Project was entirely prepared by CNCA staff and was appraised in May-June 1976 by Messrs. M. Lenot, J. Duester and R. Ingram (Bank) and Mr. J. Marinet (Consultant). Mr. S. Khorana checked tables and calculations; Mrs. E. Bolenge-Bongeli was secretary to the mission in Washington. Il. THE AGRICULTURAL SECTOR (Annex 1) 1/ A. Description and Performance General 2.01 Morocco has a total land area of 506,000 km2 2/, 7.6 million ha of which are cultivable. Nearly 10 million people out of 15 million (65%) live 1/ More detailed information will be available in the Morocco Agricultural Sector Survey currently under preparation. 2/ 1974 borders. -2- in rural areas. Agriculture contributes about 25% of GDP. About half of the labor force is employed in agriculture. Agricultural exports account for about 25% of total exports. 2.02 Most of the cultivated land lies west of the Atlas and Rif moun- tains. The climate is Mediterranean in the North, but aridity increases to- wards the South, becoming desert-like in the Southeast and the extreme South. Rainfed lands are equally distributed between higher rainfall areas (above 350 mm) and lower rainfall areas (below 350 mm). Irrigable land represents about 12% of all cultivable land. Rainfed land produces mainly grain, le- gumes and oil seeds, plus olive trees and vineyards; in the lower rainfall areas, only grain is grown. Most of the industrial crops, forage crops, vegetable crops and citrus plantations are grown under irrigation. Livestock production represents about one-third of the total agricultural production. Most of the livestock herd (4 million cattle, 15 million sheep) is raised extensively on 22 million hectares of grazing lands. Development Objectives 2.03 The long-term growth rate of agriculture has been moderate but has somewhat increased during the period of the Second Development Plan (1968-72) mainly because of irrigation expansion, increased use of fertilizers and other inputs, increased production of high value crops and favorable climatic conditions. Under the Third Plan (1973-77), agriculture (especially irrigated agriculture) continues to receive the highest priority with an emphasis toward more productive investments in irrigated and rainfed agriculture and livestock improvements. A better allocation of resources in favor of the rainfed sector should be achieved. 2.04 The main objectives of the Third Plan are to improve the trade bal- ance of agricultural products, to raise farm income through irrigation and improvement of productivity in rainfed agriculture and livestock raising, and to improve distribution of the growth of wealth through land reform and a better balance of Government support to farmers. Such targets require some consolidation of land holdings, more technicians in the agricultural sector, development of agricultural research, extension and agricultural credit, coherent pricing policies, improvement of marketing and better terms of trade for the agricultural sector. Inasmuch as possible, the Moroccan credit system is geared to these objectives by meeting the credit demand as generated by incentives and priorities assigned by the Government agricultural policies, and the Project would thus support them. The Sector Survey recognizes the general soundness of Morocco's agricultural policies. Institutions 2.05 Development of agriculture is the responsibility of the Ministry of Agriculture and Agrarian Reform (MARA) which carries out its task through the Regional Agricultural Land Development Agencies (ORMVAs) in irrigated perimeters and through its Provincial Offices (SPs) in rainfed regions. All farmers on irrigated perimeters are under the supervision of the ORMVAs and have to follow prescribed cropping patterns. Extension centers (CTs and - 3 - CMVs) are under the ORMVAs and the SPs and provide inputs and mechanization services to farmers in addition to extension. ORMVAs and SPs are also in charge of comprehensive crop programs for sugar beet, sugar cane, sunflower, hybrid corn and cotton where they provide all inputs, mechanization services, extension and credit to individual farmers, and purchase their outputs. 2.06 Although much progress has been accomplished so far, agricultural education is a constraint to agricultural development: the agricultural schools cannot graduate enough qualified personnel for both the public and the private sectors. Extension services also suffer from a lack of qualified personnel. Credit is provided mainly by CNCA, but also by local money-lenders (for those who cannot have access to institutional credit) and by commercial banks (usually only for very large farmers). Farmers' associations for mechanization help provide mechanization services to smaller farmers through joint ownership of tractors. The link between extension and credit needs to be strengthened through a build up of qualified extension staff. The system of centralized marketing for a few commodities functions reasonably well, but the impact of subsidies paid for most inputs and outputs as well as their distribution among subsectors and classes remain to be assessed. The existing investment code seems to provide adequate incentives for a reasonably well- balanced agricultural investment pattern. Land Distribution and Farmers' Income 2.07 Land distribution is unequal and skewed but there are practically no latifundia. The small size and fragmentation of holdings is a major obstacle to the improvement of productivity. Most of the cultivable land is privately owned and farmed by the owner, but 15% of total arable land is under collective ownership, whose improvement is difficult. 2.08 About 35% of the farms are recorded as not marketing any output: they can be assumed to be at the subsistence level, not generating cash and probably among those not having access to credit. The absolute poverty level can be estimated at US$1050 per family. The actual income of farmers is always very difficult to estimate but the Moroccan tax authorities have devised a fiscal income, which is a notional income based on constant para- meters measuring the productive capacity of the farm. 1/ This fiscal income is lower than the real farm income--about 40% of the real farm income for smaller farmers and much less for larger farmers. 2.09 Agrarian Reform. A modest Agrarian Reform Program has been carried out through the redistribution of 270,000 ha out of the 610,000 ha confis- cated from foreign settlers since 1956. The Third Plan calls for the redis- tribution of 400,000 ha by the end of 1977. Beneficiaries are landless farm workers or subsistence smallholders, coming from the poorest rural groups. The 18,000 beneficiaries are organized in 532 Cooperatives. The organiza- tion of the Cooperatives needs to be revised, their size enlarged and their autonomy strengthened to put them on a sounder financial basis. The Agrarian 1/ Detailed description of fiscal income in Annex 1, para. 22. -4- Reform Program has been given high priority by the Government, but its overall impact on rural poverty has been very small; by the end of 1977, 4%--at most-- of all landless workers, sharecroppers and subsistence level farmers will have received land under the Program. B. Previous Bank Projects in the Agricultural Sector 2.10 Bank Group lending for agriculture in Morocco began in 1965 and to date 8 Projects have been undertaken and supported by $202 million in Bank/IDA funds ($24 million of which in IDA credits). They include four large irriga- tion Projects: Sidi Slimane (FY65, completed), Sebou I (FY70), Sebou II (FY74) and Doukkala (FY76); a groundwater Project in the Souss (FY75); a rainfed agriculture development Project in the Meknes region (FY75); and two completed Agricultural Credit Projects (FY66 and FY73) (see Chapter IV). Difficulties arose with respect to the First Agricultural Credit Project in 1968 (see para 4.01) and to the Sebou I Project in the early 1970s (slow progress in land distribution) but since that time, the performance under the agricultural Projects has improved substantially and has been satisfactory. The emphasis on irrigation Projects reflects the Government's priority, and the relative difficulty in identifying and preparing viable Projects to serve rainfed agriculture and especially collective lands; the rainfed agriculture development Project in the Meknes region provides assistance in trying to overcome these difficulties. III. CAISSE NATIONALE DE CREDIT AGRICOLE (CNCA) (Annex 2) A. Background, Organization and Personnel 3.01 CNCA was created in 1962 to provide agricultural credit to individ- ual farmers and companies engaged in agricultural production, marketing and, to some extent, processing. CNCA is practically the only institutional source of agricultural credit in Morocco. It is an autonomous Government-owned institution. The decrees establishing CNCA are not always fully consistent with its actual practices (especially with respect to the organization of the CLCAs) and the Government has agreed to revise them accordingly. 3.02 Organization of the CNCA Headquarters office in Rabat is satisfac- tory. There are two types of CNCA branch offices: the 24 Caisses Regionales de Credit Agricole (CRCAs) which lend to medium/large-sized farmers and the 86 Caisses Locales de Credit Agricole (CLCAs) which lend to small/medium-sized farmers. They are both grouped in five regional zones headed by regional directors, to whom much decision-making power has been decentralized. - 5 - 3.03 Total staff number about 1,350, having doubled in number since 1971. 28% of the staff are at Headquarters, 40% with CRCAs and 32% with CLCAs; almost 30% of the staff have a higher level education. CNCA staff is well qualified and generally devoted to CNCA. The size of the staff will need to expand significantly over the coming years to handle the projected lending volume. Recent salary increases have made CNCA compensation system competitive with banks and other institutions; this should help prevent CNCA from losing staff to the private sector or to other Government agencies. Newly graduated agricultural staff are assigned directly to CNCA by MARA each year. Training has been quite successful in the past, given the available financial means and personnel resources, but it should now be streamlined and intensified (para 6.02). B. Lending Policies and Procedures CLCAs 3.04 The CLCAs make loans to small/medium-sized farmers with a fiscal income (para 2.08) between DH 100 and DH 3,000 (actual farm income $60 - $1,750). The total number of potential CLCA clients is above 1 million, of which about 160,000 are actually borrowing from the CLCAs; about 50% of these loans go to farmers below poverty level. The farmer's indebtedness to the CLCA is limited as a function of his fiscal income; as a result, until September 1976, only about half of the investment cost was financed by a medium-term loan on the average (para 6.04). 3.05 Financial charges on CLCA loans are not computed as interest rates pro rata temporis but a fïxed fee (usually 4%) is charged at the time of dis- bursement and on each October 1 on the amount of the loan outstanding. Each loan is also charged an initial fee of 2% when disbursed, to feed a guarantee fund to cover non-repayment losses; however, the amount available in this fund is much too high compared to the non-repayment risk. The equivalent short-term rates range between 10% and 16% p.a., and the equivalent average medium-term rate is about 6.5% p.a.; because of the initial fee, rates on medium-term loans (2 to 5 years) are distorted in favor of longer term loans ranging from 8.7% p.a. on a two year loan to 6% p.a. on a five year loan (para 6.08). 3.06 Appraisal of CLCA loans is based on a desk review; although this tends to result in somewhat rapid appraisal, the lending risk is kept low thanks to the existence of a limit on indebtedness. The productivity of the CLCA staff is very high, thus allowing a high lending volume (the norm being 500 loans per operational man-year). The CLCAs have been quite successful in attempting to reach an optimum balance between the need for adequate invest- ment appraisal and the difficulties of reaching large numbers of small/medium- sized farmers with limited institutional resources. The recovery system is very efficient, due to effective management and strong Government support (para 3.10); the recovery rates are excellent for such an institution (85% to 90% on dues and 80% to 85% on overdues). -6- HQ and CRCAs 3.07 The CRCAs make loans to medium/large-stzed farmers with a fiscal income above DH 3,000, to farmers' associations for mechanization (para 2.06) and to some Cooperatives. The Headquarters lend to Cooperatives and companies including ORMVAs and SPs (para 2.05), and to very large farmers. Lending procedures are more flexible and lending norms are higher for better, older clients of the CRCAs (and better farmers as well) than for new clients or farmers not considered modern or efficient. CNCA also finances State and private agricultural companies for production and marketing of agricultural companies. Most of the processing industry however is financed by commercial banks and development finance companies. 3.08 The provision of credit to Agrarian Reform Cooperatives is governed by specific norms: credit finances 100% of investment costs, but a percentage of short-term needs that decreases from 100% in the first year of creation of the Cooperative to 0% in the sixth year. This system, while taking into account the financial weakness of the Cooperatives, is economically irrational and ineffective, resulting in a decrease in the use of inputs when short-term credit is no more available to finance them (para 6.06). Loans to Agrarian Reform Cooperatives are guaranteed by the Government. 3.09 Interest rates, which were most recently increased in September 1975, range from 6% to 8.5% p.a. for short-term credit for production (4.75% and 5.5% p.a. for marketing) and rates on medium-term loans are 7% p.a. for Cooperatives and associations and 8.5% p.a. for individual farmers. Appraisal of loans is quite thorough and adequate; loan approval is decentralized at the CRCA level, except for some very large loans, and is usually speedy and flexible. As in the case of the CLCAs, the efforts to reach an optimum balance between the desired thoroughness of appraisal and the objective of reaching large numbers of farmers with institutional resources larger than the CLCAs but nevertheless limited, have resulted in flexible procedures for loan appraisal and approval. 3.10 Rates of recovery are slightly below those of the CLCAs but are still satisfactory approaching 80% on dues and 65% on overdues. The recovery system is efficient as far as individual farmers, farmers' associations and Cooperatives are concerned, but there have been difficulties with companies, ORMVAs and some very large farmers. The same legal instruments can be used for recovering CNCA debt as for recovering State debt; this contributes significantly to CNCA's good repayment performance and the Government has undertaken that the decree granting this privilege to CNCA will remain in force. C. Sources and Uses of Funds Resources 3.11 CNCA's equity funds total DH 266 million and include CNCA's capital proper (DR 136 million), the CLCA's General Fund (DR 93 million) and Guaran- tee Fund (DH 10 million) and the General Reserve (DH 27 million). The IDA Credit for the Second Agricultural Credit Project (338-MOR) and a loan from Iran, both lent to the Government of Morocco, have been made available to CNCA as equity. The equity capital is Government-owned and not dividend-bearing. Deposits have increased more than five times since 1971 and amount to DH 137 million (Annex 2, para 46); mobilization of additional deposits is one of the most important tasks of CNCA, which has launched active publicity campaigns and devised special savings schemes in order to overcome the constraints hampering its efforts at attracting more deposits. 3.12 CNCA can have recourse to cash advances from the Central Bank and from another State bank. Its long-term borrowings have been from IBRD (Chapter IV), from the German aid agency Kreditanstalt fur Wiederaufbau and from the City of Agadir. It has also made two bond issues of DH 30 million each. Resources presently available to CNCA amount to about DH 770 million; their weighted average cost is 2.16%. Operations 3.13 CNCA has only negligible equity participations (DH 1 million). Total CNCA lending in 1974/75 amounted to DR 711 million broken down as follows: (DH million) Short-term Medium-term Total CLCAs 13 73 86 HQ/CRCA individual farmers 158 80 238 Comprehensive crop programs 203 9 212 Cooperatives and associations 63 23 86 Companies and others 60 29 89 Total 497 214 711 Projections for future lending operations, made on the basis of past trends and of Government priorities in the agricultural sector, form the basis for the Project cost computation. -8- D. Financial Position 3.14 The profitability of HQ/CRCA operations has been adequate, except for an operating loss in 1973/74, and is expected to remain satisfactory. Income and expenses as percentages of average assets are as follows (1975/76): HQ/CRCA CLCA Total Operating income 8.3% 6.1% 7.8% Government subsidy to CLCA - 1.9% 0.4% Total income 8.3% 8.0% 8.2% Financial expenses 2.9% 0.2% 2.3% Administrative expenses 3.9% 7.7% 4.7% Depreciation and provisions 0.9% 0.1% 0.8% Total expenses 7.7% 8.0% 7.8% Net income 0.6% - 0.4% Because of the higher administrative costs of lending to small farmers and of lower lending rates, and despite lower financial costs and higher staff pro- ductivity, the CLCAs have always had operating losses, which have grown sig- nificantly over time, especially with the increase in lending of the last few years. Relatively low interest rates are used as a means of subsidizing the agricultural sector, and especially the smaller farmers. This may intro- duce some economic distortions through choices of capital intensive technology. Some adjustments are necessary (Chapter VI) but overall, in the context of the general structure of interest rates in the country and of the revision of interest rates taking place in Morocco from time to time, CNCA interest rates for its HQ/CRCA operations can be deemed satisfactory as long as they provide CNCA with an adequate income, while interest rates for CLCA lending should be regularly increased to decrease dependence from Government through its subsidy. 3.15 CNCA financial structure is satisfactory and is expected to remain so in the future. CNCA's risk is both economic and institutional. In eco- nomic terms, all of CNCA assets are with individuals or companies active in the agricultural sector (including marketing and processing of agricultural commodities). Because of this strong unisectoral exposure, output fluctuations (bad harvests) could significantly increase CNCA's risk. However, CNCA has been successful in keeping this risk to a minimum, as demonstrated by its re- covery rates. In institutional terms CNCA is financially dependent upon the Government, which owns 100% of its equity, and provides an operating subsidy for the CLCAs. CNCA has nevertheless managed to remain operationally very independent in the past, 1/ but in the future a stronger financial position will probably be necessary for CNCA to maintain its autonomy, especially with 1/ Except for a few very specific loans for which adequate guarantees were provided by the Government. - 9 - respect to the CLCAs. The Project would assist in this respect by ensuring increases in lending rates when necessary to improve CNCA income earning position and to limit the Government's operating subsidy to the CLCAs (paras 6.09 and 6.12). This would help to achieve a proper equilibrium between CNCA's financial autonomy and its role as a Government agency, implementing credit programs in line with the Government's agricultural policies. 3.16 Overall, CNCA has grown to become a very good agricultural credit institution, and a very efficient one in lending to small farmers on an in- dividual basis, while obtaining excellent recoveries and keeping costs within reasonable limits. Its next challenge will be to further expand its lending to small farmers within the same cost limits: it probably will need to ex- periment with new mechanisms for delivering credit, for example, group credit. IV. PERFORMANCE UNDER THE PREVIOUS AGRICULTURAL CREDIT PROJECTS (Annex 3) A. First Agricultural Credit Project (Loan 433-MOR) 4.01 The $10 million Loan financed the CNCA lending program for the period 1966-69. It included lending for on-farm development of medium and large farms and lending for farm equipment and machinery of a State company in charge of managing land confiscated from foreign settlers. The overall performance of the Project was not without problems and the Loan was sus- pended and part of it cancelled, as a result of a breach of covenants on separation of the CLCA accounts by CNCA and the Moroccan Government. The combination of CNCA's relative weakness at the time in terms of staffing and financing and of the Government's heavy interference in CNCA operations caused the First Project's performance to be not only rather disappointing, but also a source of considerable controversy within the Bank. 4.02 This Project was evaluated by the Operations Evaluation Depart- ment in 1973-74; 1/ its report acknowledges that the analysis was biased by the severe droughts experienced by Morocco during this period and that its results could be misleading and need to be very carefully interpreted. It points out to a low return on mechanization investments because of the droughts; it recognizes however that tractors are the only means to break the ground in years of drought and that the alternative for the farmer is therefore between getting some crop, or getting no crop at all. The OED assumption of a drought every five years seems unjustified by historical data, which points out to a drought every ten years rather. Present analysis 1/ OED Report: Agricultural Credit Programs, Background Paper No. 4. The conclusions of the general OED Report (Agricultural Credit Programs, Report no. 1357, issued November 18, 1976) are discussed in para. 7.08. - 10 - (Appendix 1.1 and Annex 4, models 5 and 6) shows adequate returns on mecha- nization investments, using conservative average yields, based on a conserva- tive pattern of good and bad crop years. The OED report also points out to the complementarity between tractor use and new cultural practices (new varieties, fertilizers, pesticides, etc.): modern cultural practices, without proper land preparation through use of a tractor, would not reap adequate benefits, and thus benefits have to be entirely attributed to the tractor, whose use will almost always imply new cultural practices. Overall economic results appear to be inconclusive (the OED "guess" of an economic rate of return of 5% appears pessimistic) but the main impact of the Project was clearly the improvement in CNCA's management and operations. B. Second Agricultural Credit Project (Loan 861-MOR, Credit 338-MOR> Project Description 4.03 The Loan/Credit of $34 million was made to finance CNCA lending for 1973-76 to medium and large farmers (HQ and CRCA clients) for investments in grain farm equipment, citrus plantation development, winter vegetable produc- tion, dairy farm development, beef cattle and sheep farms, and marketing facilities. The Project cost was estimated at $69.4 million and the Loan/ Credit was to cover the foreign exchange cost of the Project. The objectives of the Project were to encourage investment in and modernization of the agri- cultural sector through loans to 8,000 farms ranging from 5 to 50 ha of irri- gated land and from 15 to 200 ha of rainfed to land; to generate employment for about 18,000 persons; and to reduce imports of grain, milk and meat and increase exports of citrus and vegetables. After lengthy discussions and negotiations, it was agreed that an interest rate of 8% was to be charged by CNCA on subloans except for subloans to the "lower income" farmers (fiscal income between DH 3,000 and DH 6,000), who would still be charged 6.5%; however, subloans at 6.5% should not exceed 20% of the total Project lending. The CLCA clients (fiscal income below DH 3,000) were excluded from the Project. Project Implementation and Realization 4.04 Due ta difficulties in pre-negotiations and negotiations, temporary unavailability of IDA funds and delays by CNCA in submitting effectiveness documents, the Loan/Credit became effective in February 1973, while the ap- praisal work had been completed by early 1971. Delays in disbursements, due to CNCA difficulties in assembling the necessary disbursement documentation, to computer hardware difficulties and to the ceiling on subloans at 6.5%, occurred until the summer of 1975. Higher interest rates on all CNCA loans were introduced in September 1975, thus stepping up disbursements. The Loan/Credit was fully disbursed in May 1976 as initially forecast. Subloans to individual farmers and associations submitted for refinancing amounted to about 77% of the total amount of medium-term loans extended by CNCA to indi- vidual farmers and associations through HQ and CRCAs only for the period between September 1972 and April 1976 (including some loans not eligible for refinancing under the Project). - il - 4.05 The demand for equipment on grain farms turned out to be lower than expected and only 85% of the funds ($18 million) allocated to this component were actually disbursed. Only 60% of the original estimate ($11.5 million) for citrus plantations and vegetable cultivation was disbursed in this cate- gory, essentially because of the curtailment of new citrus plantations; in May 1975, $4.5 million were reallocated from the citrus and vegetable category to the livestock category. Demand for funds from the livestock development cate- gory was the strongest as a result of the Government incentives for livestock investments that were intended to correct the permanent shortage of milk and meat. In May 1975, $5 million were reallocated to this category; total dis- bursements amounted to more than three times the original estimate of $3.5 million. The marketing facilities component was by far the least successful; its allocation ($1 million) was cut in half in May 1975 and total disburse- ments amounted to 68% of the original estimate. Beneficiaries 4.06 Overall about 17,000 farmers were reached with an average loan amount per farmer of DH 12,000 versus a forecast of 8,000 farmers with an average loan of DH 28,000. 98% of the Loan/Credit was disbursed for individ- ual farmers. Only 20% of the funds went to "lower income" farmers which had to pay only 6.5% interest while during the same period about 35% of HQ/CRCA disbursements were made to this category. Thus the Project helped finance mostly large farmers. A few Cooperatives and a State company, SODEA, vere also financed under the Project. Institutional Performance 4.07 The Bank was concerned about CNCA institutional development and in- sisted on four covenants regarding the separation of accounts of the CLCAs and of the Government operations, the strengthening of CNCA capital, the audit of CNCA and an adequate profitability of CNCA. The first three covenants were met (the IDA Credit was given to CNCA as equity capital). To improve CNCA profitability, interest rates were increased on September 1, 1975, but re- serves accumulating from net income have not yet been able to reach 15% of equity capital as sought, since equity capital has more than doubled since 1971. 4.08 CNCA has over the past few years grown to become an efficient and sophisticated agricultural credit institution. To the extent that the Bank supported this growth by its financing and its supervision, the institutional impact of the Second Project can certainly be considered beneficial. In re- trospect, however, it seems that the impact of the Project could have been even more beneficial if the Bank had not at the outset excluded the CLCAs from its financing, if it had been more flexible on the interest rate issue (thus not excluding from its financing a large number of the smaller CRCA clients) and if it had not insisted at first upon unecessarily complicated disbursement procedures. - 12 - Economic Performance 4.09 Although it has been difficult to obtain accurate data on the impact of the Project upon production, it seems that the economic performance of the Project was acceptable. This lack of data clearly underlines the need for a monitoring system to be established (para. 6.15). The overall performance and impact of the Second Loan can nevertheless be considered positive, especially on the institutional side. V. THE PROJECT A. Objectives 5.01 The previous two Agricultural Credit Projects were aimed principally at increasing agricultural production through mechanization and modernization of medium and large farms and at strengthening CNCA. The Third Project would also aim at increasing agricultural production to meet Morocco's rising demand in line with the Plan's objectives and at further expanding CNCA's capability as an agricultural credit institution; but it would contribute as well to the improvement of the income of small farmers borrowing through the CLCAs (eli- gible for the first time for Bank financing) and to the strengthening of Cooperatives and associations in support of the Agrarian Reform Program. B. Description 5.02 The Project would finance most of CNCA medium and long-term lending for agricultural investments (for which representative farm models have been prepared in Annex 4) and would consist of eight parts: (A) Medium-term lending to individual small/medium-sized farmers borrowing through the CLCAs for on-farm investments; (B) Medium and long-term lending to individual medium/large-sized farmers borrowing through CNCA headquarters and the CRCAs for on-farm investments; (C) Medium-term lending to regional land development agencies and provincial offices of the Ministry of Agriculture for invest- ments undertaken by farmers under their supervision for com- prehensive crop programs; (D) Medium and long-term lending to Agrarian Reform Cooperatives for their own on-farm investments and those of their members; - 13 - (E) Medium-term lending to farmers' associations of small farmers for agricultural machinery; (F) Monitoring fellowships for CNCA for establishing a monitoring and evaluation system; (G) Consultants' services to CNCA for studies on banking development and staff training, and provision of audio visual equipment for training; (H) An applied research program in vegetable cultivation by the land development agency for the Souss-Massa region (ORMVASM). 5.03 The first five components would cover CNCA loan commitments for the period January 1977-August 1979. Loans for non-productive purposes (such as land purchase) would be excluded. State companies would be excluded from the Project because of the likelihood of distribution of their land holdings and of CNCA's lack of autonomy in its decision to finance their investments. Pri- vate companies would also be excluded from the Project because the future of the agricultural production companies is legally uncertain and the processing companies normally have other sources of finance. The Project would include the rest (about 80%) of the CNCA medium- and long-term lending program. Individual Small/Medium-sized Farmers - Part A 5.04 This category would finance individual farmers who are CLCA bor- rowers, i.e., those with a fiscal income between DH 100 and DH 3,000 (real farm income $60 - $1,750). It would include grain and mixed farming, dairy and fattening farms and some plantations and vegetable growing. Investments would consist mainly of cattle, sheep, stables, draft animals and small equipment, wells and pumps, and land improvement. Investments in tractors and combine harvesters would not be financed under this category since farmers receive mechanization service from the Government extension centers or from custom operators. They can also form farmers' associations to pur- chase machinery (Part F). Almost half (47.2%) of the Project cost ($148.8 million) would be in this category. Individual Medium/Large-sized Farmers - Part B 5.05 This category would finance individual farmers who are clients of the CRCAs or of the CNCA Headquarters, i.e., those with a fiscal income above DH 3,000 (real farm income above $1,750). It would include grain farms, dairy and fattening farms, vegetable producers, plantations and mixed farming. In- vestments would consist mainly of tractors, combine harvesters, trucks, cattle and sheep, stables, plantations, draft animals and small equipment, wells and pumps, land improvement and some chicken breeding, beekeeping, alfalfa estab- lishment and processing equipment. It would not include loans for housing, land purchase and the like. About 37.3% of the Project cost ($117.7 million) would be in this category. - 14 - Regional Land Development Agencies & Provincial Offices - Part C 5.06 These agencies are in charge of managing large irrigation systems (Offices Regionaux de Mise en Valeur Agricole--ORMVAs) or they are the pro- vincial offices of the Ministry of Agriculture for rainfed land (Services Provinciaux-- SPs). Most credit provided under the comprehensive industrial crop programs (para 2.05) is short-term credit, but some crops such as sugar cane and alfalfa also require medium-term credit which will be provided under this category. The ORMVAs and SPs would pass on the credit to the individual farmers for the creation and initial maintenance of sugar cane plantations and for establishment of alfalfa fields. About 3.6% of the Project cost ($11.4 million) would be in this category. Agrarian Reform Cooperatives - Part D 5.07 This category would include all the Agrarian Reform Cooperatives (para 2.09). These investments would be carried out by the Cooperatives themselves (tractors, combines and related machinery, trucks) or individually by the members borrowing through their Cooperatives (cattle and sheep, stables, plantations, draft animals and small equipment). Loans for housing and sub- sistence loans would not be included. About 10.3% of the Project cost ($32.6 million) would be in this category. Farmers' Associations - Part E 5.08 This category would include all farmers' associations for mechaniza- tion; their members are small/medium-sized farmers not individually eligible for tractors (because of the small size of each of their farms), thus invest- ing collectively in one tractor. Investments would consist only of tractors and implements and a few combine harvesters. About 1.1% of Project ($3.5 million) would be in this category. Monitoring Fellowships for CNCA - Part F 5.09 This category would provide funds ($50,000) for assistance to CNCA in setting up a farm monitoring system (as described in para 6.15) in the form of fellowships for CNCA staff to visit agricultural institutions with efficient monitoring systems in other countries. If necessary, it would also finance the employment of a monitoring consultant. Consultants' Services to CNCA - Part G 5.10 This category would provide funds ($0.7 million in foreign exchange) to CNCA for employing consultants to assist CNCA management in setting up and implementing a banking development program (with emphasis on deposits collec- tion) and a staff training program; funds would also be provided for the purchase of audio visual equipment. Terms of reference and consultants' selection would be approved jointly by the Arab Fund and the Bank. - 15 - ORMVASM Applied Research Program - Part H 5.11 This category would finance the foreign exchange cost ($300,000) of an applied research program with international and Moroccan experts in vegetable cultivation in the Massa irrigation system (Annex 9), including the cost of some research equipment. This applied research program is part of the preparation process of an agricultural development project under consideration by the Bank. Its objectives are thus limited to this narrow purpose. Terns of reference and the selection of consultants have already been approved by the Bank. C. Cost Estimates (Annex 5) 5.12 The Project cost estimates are based on current prices of the respective investments. Total Project cost is estimated at DH 1,355.8 million ($315.3 million) of which approximately 34.4% or $108.5 million would be in foreign exchange. These estimates are summarized in the following table. - 16 - Project Cost Foreign Local Foreign Total Local Foreign Total Exchange - DH'000 -------- ------- US$ 000 ---…--- Agricultural machinery 102,390 135,750 238,140 23,811 31,570 55,381 57 Cattle & Sheep 226,750 62,650 289,400 52,733 14,570 67,303 22 Stables, sheep- folds & stores 129,200 76,000 205,200 30,047 17,674 47,721 37 Plantations 36,860 26,250 63,110 8,572 6,105 14,677 42 Land improve- ment 14,000 6,000 20,000 3,256 1,395 4,651 30 Wells & pumps 58,260 24,540 82,800 13,549 5,707 19,256 30 Draft animals & small equipment 163,800 6,600 170,400 38,093 1,535 39,628 4 Others 1,740 1,710 3,450 404 398 802 50 Total base cost 733,000 339,500 1,072,500 170,465 78,954 249,419 32 Physical con- tengencies (5%) /1 36,600 17,000 53,600 8,512 3,953 12,465 32 Price contingen- cies (19.9%) /2 118,400 105,500 223,900 27,535 24,535 52,070 47 Lending sub-total 888,000 462,000 1,350,000 206,512 107,442 313,954 34.2 Monitoring fellow- ships for CNCA - 210 210 - 50 50 100 Consultants' services to CNCA 975 3,100 4,075 238 708 946 75 ORMVASM Applied Research Program 225 1,290 1,515 50 300 350 86 Grand Total 889,200 466,600 1,355,800 206,800 108,500 315,300 34.4 /1 Applied to all lending categories. /2 19.9% of base cost plus physical contingencies; based on the estimated price increase for each component (ranging from 5% to 15% p.a.) given in Annex 5 Table 1. - 17 - D. Financing (Annexes 5 & 6) 5.13 Financing would be shared in the following amounts and proportions (DH million): (errors due to rounding) CNCA Sub- Own Arab borrowers Government Funds IBRD Fund Total % % z %% A 180 28 18 3 320 50 122 19 - - 640 B 163 32 1 1 224 44 - - 118 23 506 C 15 30 - - 22 46 - - 12 24 49 D 28 20 20 14 67 48 25 18 - - 140 E 3 20 5 30 5 34 2 16 - - 15 Subtotal 389 29 44 3 638 47 149 il 130 10 1,350 F - - - - - - 0.2 100 - - 0.2 G - _ _ - 1.0 24 - - 3.1 76 4.1 H - - 0.2 14 - - 1.3 86 - - 1.5 Total 388.8 28.7 44.6 3.3 638.6 47.1 150.5 11.1 133.3 9.8 1,355.8 US$ Million 90.4 10.4 148.5 35.0 31.0 315.3 5.14 CNCA would be the Borrower of the Bank Loan. The Loan would be for a period of 13 years including a 3-year grace period, and would bear an 8.7% interest rate. The Loan maturity and grace period are based on projections of lending operations and subborrowers' repayments (Annex 6). The Government would carry the foreign exchange risk as was done under the previous Projects under satisfactory procedures. The Bank Loan would finance only the Project components aimed at small/medium-sized farmers, i.e, the individual CLCA borrowers and the Cooperatives and associations. The Arab Fund loan of KD 9 million for 15 years with 5 years grace period at 6% interest would finance the Project components aimed at medium/large-sized farmers either directly or through the ORMVAs and SPs. Together the Bank and Arab Fund loans would meet the financial gap of CNCA. CNCA would thus finance almost 40% of the foreign exchange cost of the Project from its own resources; this would be essentially indirect foreign exchange and would not present any difficulties for CNCA, which has provided about half of the foreign exchange cost for in- vestments it financed during the period 1971-75. Subborrowers would finance 29% of the Project cost as their own contributions. The Government would provide small investment grants almost exclusively to Cooperatives and asso- ciations; these grants would amount to only 3% of the total Project Cost. They are considered reasonable and would not introduce any serious distortion in the investment pattern. In addition, the Bank Loan would finance the cost of the monitoring fellowships for CNCA and the foreign exchange cost of the applied research program for ORMVASM, while the Arab Fund loan would finance the foreign exchange cost of the consultants' services to CNCA. - 18 - E. Procurement 5.15 The range of goods to be financed under the Project is varied and would not be suitable for bulk procurement; contracts vould be far too small to warrant competitive bidding advertised internationally. Foreign suppliers of machinery are well represented in Morocco, necessary service facilities are available, competition is keen and prices are competitive. Subborrowers would therefore purchase agricultural equipment of their choice through existing local channels. Dairy farm development would require procurement of incalf heifers, most of which would come from Government or private farms. However, should more than 75 heifers be imported under any sub-loan, quota- tions from suppliers from at least three countries would be sought. Experts and researchers (60 man-months) required under the applied research program for ORMVASM have been selected according to the Bank guidelines for contract- ing consultants' services. Goods and consultants' services financed by the Arab Fund loan would be awarded under the Arab Fund procurement rules. F. Disbursement (Annex 7) 5.16 The Project commitment period is for two and one-half years (January 1977 - August 1979) and CNCA's disbursements to subborrowers would be in ac- cordance with the phasing of individual subproject development. The Bank Loan would be disbursed in about 3 years. The Bank would reimburse CNCA against certified statements of expenditures for 27.5% of subloans disbursed under Parts A, D and E. However not more than $5.6 million would be disbursed from the Bank Loan for subloans under these three parts, as long as the changes in financial charges and lending policies mentioned in Chapter VI have not been implemented; these changes would take place not later than September 1, 1977. Documentation for the statements of expenditures would not be sent to the Bank but would be retained by CNCA for review by supervision missions. The Bank would also reimburse CNCA, against full documentation, for 100% of the expenses under Part F. The Bank would reimburse CNCA, against full documentation, for 100% of the foreign exchange cost under Part H, and CNCA would in turn relend these funds to ORMVASM under a formal lending agreement at terms and conditions satisfactory to the Bank. Retroactive financing to November 22, 1976, up to $100,000 would be allowed under Part H to ensure an early start for the research program. Funds remaining in any category at the end of the Project could be reallocated to other categories if necessary for use under Project activities. Parts B, C and G would be financed by the Arab Fund. VI. PROJECT IMPLEMENTATION A. Organization & Management 6.01 CNCA would be the Borrower and carry out the Project. The Ministry of Agriculture would assist CNCA as required. Assistance by the Ministries - 19 - of Finance and the Interior and by the Central Bank may also be provided if required. Part A of the Project would be carried out by the CLCAs, Parts B and E essentially by the CRCAs and to a small extent by Headquarters; Part D would be executed essentially by Headquarters with some decentralization to the CRCAs and Part C by Headquarters through the ORMVAs and the SPs. Parts F and G would be carried out by CNCA and Part H by ORMVASM. 6.02 The Government and CNCA have undertaken to maintain the competitive- ness of the compensation system of CNCA staff with other comparable institu- tions, including commercial banks; this should allow CNCA to recruit and retain the additional well qualified staff it needs for the future expansion of its operations. The Government has also undertaken to assign to CNCA an adequate number of newly graduated agricultural staff. The Arab Fund will negotiate with CNCA terms of reference for consultants to assist CNCA in two aspects of its operations: banking development (including measures to increase deposits collection) and training (including possibly the creation of a Training Institute for Agricultural Credit). These terms of reference would be subject to Bank approval. B. Lending Policies & Procedures Lending Procedures 6.03 Existing lending procedures of CNCA are generally adequate. Speci- fic changes would be needed for loans to Cooperatives. Existing satisfactory procedures would be maintained and the changes in policies, procedures and financial charges outlined below would be implemented by CNCA at the latest on September 1, 1977, the beginning of its fiscal year and the start of the crop year. 6.04 CLCA Borrowers. The appraisal of CLCA subprojects will be improved and upgraded to the CRCA level only gradually through a significant increase in the number of agricultural staff assigned to the CLCAs. The financing ratio (annual principal repayment to fiscal income 1/) increased in September 1976 from 35% to 50%; it can be estimated that, as a result, CLCA borrowers have now 70% of their investment cost financed by credit, like all other CNCA borrowers. Since the fiscal income parameters are constant (para. 2.08) the financing ratio would be reviewed periodically in view of the price increases for investment goods and of the resources available to the CLCAs. 6.05 Cooperatives. The present appraisal procedures by CNCA of Coopera- tives' investment projects would be decentralized to the CRCA level to the extent feasible so that an adequate appraisal could be made by the CRCA staff in direct relationship with the Cooperatives for which it is responsible. 6.06 To correct the present deficiencies in the provision of credit to Cooperatives (para 3.08) the following schedule would be adopted: 1/ See Annex 2, para 42. - 20 - …_____--------------…Years…--------------------- age of the Cooperative 1 2 3 4 5 6 & older percent of financing of - short term inputs 100% 80% ----------- norm ---------------- - new investments 100% 100% 100% 100% 80% norm - replacements --------------------- norm ----------------------- The norm is defined as the financing norm (usually 70% of cost) that would apply to an individual farmer in the same location for the same activity or investment at the same time, according to the lending regulations. In 1977/78 about half of the Cooperatives and associations would be 6 years old or older. 6.07 Individual HQ/CRCA Borrowers, Regional Land Development Agencies and Provincial Offices, and Associations: The lending procedures applying to these categories of borrowers are adequate. All lending regulations are revised every year to take into account price increases and policy orienta- tions. Significant changes in these lending regulations (such as a lengthen- ing of maturities on subloans) would need the concurrence of the Bank. Financial Charges 6.08 CLCAs. The present system of financial charges on CLCA loans (para 3.05) is attractive because of its simplicity and low operating cost and should therefore be maintained. However, the present bias against medium-term loans with shorter terms for which charges are higher would be corrected by intro- ducing differentiated fees. The average charge for medium-term loans would also be increased from about 6.5% p.a. to about 7.7% p.a. 1/ Short-term rates would be at least equal to medium-term rates. The amount available in the CLCA Guarantee Fund being too high compared to the risk of non-repayment, it would not be necessary any more to pay the initial fee into the Guarantee Fund; both the initial fee and the annual fee would be paid to income. Pro- visions for the Guarantee Fund would have to be made from income each year as required. 6.09 In the future the fee levels would be reviewed annually on the basis of CLCA's income forecasts with a view towards gradually phasing out the Government operating subsidy to the CLCAs. The CLCAs would not be able to operate in a financially viable way in the near future, but as a first step, during the disbursement period of this Loan, the forecast income should be equal to at least 77% of the forecast expenses, thus limiting the forecast Government subsidy to 23% maximum of the forecast expenses. 2/ When the 1/ This reference rate being the average rate (including penalty interest and administrative fees) on all CNCA operations (excluding CLCAs) for the year 1975/76. 2/ These ratios being those actually attained in the year 1975/76. - 21 - Government subsidy would be forecast to exceed these ceilings, the CLCA fees would be increased to prevent this occurrence. This is likely to happen in the fiscal year 1979/80. The actual Government subsidy would cover in any case the actual loss of the CLCAs. 6.10 Cooperatives & Associations. Medium-term loans to Cooperatives and associations now bear a rate of 7% p.a. This rate would be increased to the rate applied to individual borrowers, i.e., 8.5% p.a. However, since members of newly-created Cooperatives and associations are just making the transition from the traditional to the modern sector, this increase should be gradual: -----------------Years-------------------- Age of Cooperative or association 1 2 3 4 5 6 & older Minimum interest rate p.a. on medium-term loans 7.0% 7.0% 7.0% 7.0% 8.0% 8.5% 6.11 Regional Land Development Agencies and Provincial Offices. Loans to ORMVAs and SPs bear a rate of 8% p.a. These rates are satisfactory and would be maintained. The loans made by the ORMVAs and SPs to the individual farmers, if short-term, are charged a flat 5% commission, regardless of duration and, if medium-term, bear a rate of 8.5% p.a. 6.12 HQ/CRCA Rates. The present basic interest rate of 8.5% p.a. for medium-term loans to individual farmers is adequate. It is in line with interest rates charged in other sectors of the economy, it is higher than the forecast inflation rate of about 7% p.a. over the life of the Project and it allows CNCA to cover costs and make a reasonable profit. It would therefore be currently maintained. All HQ/CRCA rates would be reviewed annually on the basis of income forecasts and would be adjusted as needed to ensure continued profitable operation of CNCA. With its current rates CNCA is likely to be profitable up to 1982. Short-Term Credit 6.13 CNCA would ensure that subborrowers under the Project would have access to short-term credit on appropriate terms for input financing. Financial Covenants 6.14 As safeguards, CNCA would respect two financial covenants: (a) that medium- and long-term debt (including deposits of over 12 months) would not exceed 4 times equity, and (b) that current assets would be at least 120% of current liabilities. According to financial projections, no problems in meet- ing these covenants are foreseen. C. Monitoring & Evaluation (Annex 8) 6.15 Not only should the internal and external reporting system of CNCA be improved, but CNCA should also set up a monitoring and evaluation system - 22 - as described in Annex 8 to measure on a selective basis the effects and the impact of its lending. This would allow CNCA management to use this informa- tion as a feedback into its own policies, especially for the annual revision of lending policies. It would also serve as an on-going evaluation of the performance of the Project and its conclusions would be discussed with the Govenment who would use them as an input into its agricultural policy. A draft proposal would be submitted to the Bank by March 1, 1977 and the system should be implemented by September 1, 1977. Part F of the Project would provide funds for fellowships for CNCA staff to visit agricultural institu- tions in other countries with efficient monitoring systems. If it proves to be necessary, employment of a monitoring consultant would also be financed by the Loan under terms of reference satisfactory to the Bank. D. Accounts & Audit 6.16 CNCA has a satisfactory accounting organization and management in- formation system. Audit arrangements under the Second Project were satisfac- tory. CNCA would continue to have its accounts audited by independent auditors acceptable to the Bank and to send the auditors' annual report to the Bank within five months of the end of its fiscal year. VII. BENEFITS & JUSTIFICATIONS A. Production & Marketing 7.01 Investments under the Project (together with other concomitant in- vestments, such as irrigation expansion) are expected to generate the following production at full development (about Year 10 of the Project): (quantities in thousands of tons) % of Future % of Future Total Moroccan Total Moroccan Quantity Production Quantity Production Grain 440 12 Olives 1 Pulses 50 il Grapes 1 - Cotton 25 90 Vegetables 150 20 Sunflower 20 90 Cow's milk 380 50 Sugar beet 2,000 90 Sheep's milk 17 50 Sugar cane 450 90 Beef 15 20 Citrus 20 2 Mutton 12 20 This production would be worth about DH 1.5 billion in current prices. - 23 - 7.02 Since the Project would cover practically all of Morocco's agricul- tural credit, the problems of marketing the production under the Project will be those facing Moroccan agriculture in general. To a large extent the in- creased production will imply reduced imports especially for grain, oil seeds, sugar, meat and milk. About half of the vegetable production would be ex- ported; Morocco has a strong competitive advantage on the European market and is developing exports to countries other than France under the recent market- ing treaty with the EEC. Citrus production may be somewhat more difficult to export, but the incremental production under the Project would represent only 2% of total production; the same would be true of olives and grapes. Meat production would essentially be for the domestic market, where consump- tion patterns are changing significantly toward a better diet as a result of the rise in incomes. B. Financial Benefits (Annex 4) 7.03 The financial results for representative farm models under the Proj- ect are given in Annex 4. The calculations are based on Moroccan prices for the spring of 1976 for both inputs and outputs. The financial rates of re- turn for the models vary between 14% and 25%. The sensitivity analysis yields the following results: if investment costs were raised by 10%, the financial rates of return would vary between 12% and 24%; an increase in operating ex- penses of 10% would result in financial rates of returu between 7% and 24%; and if revenues were to drop by 10%, the rates would range from 4% to 22%. Sensitivity analysis has also been carried out for some models with respect to a reduction in the income from milk, a lower rental rate of a combine harvester, delays in reaching full development for a citrus plantation and a reduction of the income from exported vegetables. These rates of return show that the proposed investments under the Project would be financially attrac- tive to sub-borrowers. C. Economic Benefits (Annex 10) Employment 7.04 The Project would generate substantial employment benefits. An es- timated 20,000 man years of additional family labor would be generated mostly because of livestock investments. Similarly, about 10,000 man-years of tem- porary labor and 10,000 permanent jobs for agricultural workers would be created. The average investment cost per man-year would therefore be about DH 26,800 (US$6,200) in constant prices. However, some investments such as tractors and combine harvesters would reduce employment on a per unit basis, but tractors would increase indirect employment and combine harvesters would be justified because of seasonal shortage of labor at harvest time (Appendix 1.1). These investments appear therefore justified economically. Sizeable employment opportunities generated through the additional investments, the additional input use and the increased production via backward and forward linkages have not been quantified. - 24 - Beneficiaries 7.05 The number of CNCA borrowers is estimated to increase as follows under the Project: Pre-Project /1 (1/1/77) End-Project /2 (8/31/79) % of eligible % of eligible Number farmers Number farmers CLCA clients 157,000 15% 245,000 24% HQ/CRCA clients 52,000 58% 60,000 67% ORMVAs and SPs /3 4,000 100% 5,000 100% Cooperatives 16,000 100% 40,000 100% Associations 2,000 90% 3,000 95% Total /4 230,000 29% 350,000 41% of which below poverty level 80,000 140,000 (% of Total) 35% 40% /1 See Annex 2, Table 24. /2 See Annex 5. /3 Only 4% of the 100,000 to 125,000 farmers borrowing short-term are expected to apply for medium term loans. /4 Double counting eliminated. About 350,000 farmers would borrow under the Project and thus improve their productivity and their income significantly. About 140,000 farmers (40% of total) would be below the absolute poverty level (US$1050 per family equivalent to DH 1350 fiscal income 1/): 50% of the CLCA clients, 50% of the Cooperative members and practically all the association members. About 120,000 farmers (34% of total), mostly CLCA clients and new Cooperative members, would never have had access to credit before. 7.06 By the completion of the Project (August 1979), credit would reach about 24% of CLCA potential clients instead of the present 15%, 67% of HQ/ CRCA potential clients instead of 58% now, and practically all the members of Cooperatives and associations and all the farmers borrowing through com- prehensive industrial crop programs. Credit would reach about 41% of all eligible farmers (i.e. those with a fiscal income above DH 100) or 20% of all Moroccan farmers. Credit coverage would be lower for farmers in the lower income strata: less than 3% of the farmers having a fiscal income between DH 100 and DH 300 (CLCA clients) would have access to credit, and only about 15% 1/ Taking into account the fact that about 25% of family income is not earned on the farm. - 25 - of those in the range DH 300 to DH 800. The farmers having a fiscal income below DH 100 (i.e. 1 ha or less of poor rainfed land or two cows), the land- less farmers and most of the farmers on collective land, would practically not have any access to credit. For those farmers at subsistence level, num- bering between 850,000 and 1,000,000 in total, agricultural credit may not be the proper answer to their needs: its provision is costly and it implies an integration into the financial and economic circuit, that these farmers are not yet able to achieve. Specially designed rural development projects would probably be better adapted to their needs. Project Benefits and Risks 7.07 The economy is expected to realize a return of 29% from total Proj- ect investments (Annex 10). A sensitivity analysis was applied to test the Project against changes in investment costs, operating expenses and produc- tion results. By increasing investment costs and operating expenses alter- natively by 10%, the rate of return of the whole Project would drop to 25% and 15%, respectively. By decreasing the value of the benefits by 10%, the overall return would drop to 11%. 7.08 Several risks could affect the outcome of this Project. They are discussed in the context of the conclusions and recommendations of the OED Report on Agricultural Credit Programs 1/. First, as in any agricultural project, the major risk would be the occurrence of severe adverse climatic conditions, namely droughts, that would affect drastically the yields of farmers borrowing under the Project and thus reduce the economic justification of their investments. Historical pattern tends to show that a severe drought will occur once in a decade in Morocco, that the period 1968-1973 was unusual in this respect, and that the occurrence of a drought one year out of five should not be implied. Yield assumptions in the farm models are averages for farmers likely to borrow; they are based on a detrimental historical pattern of good and bad years and are very conservative. The relatively low (but still acceptable) rate of return of the Project in case of decreased benefits is due to this conservative assumption; such an unfavorable outcome is not very likely. Second, there is the risk of a drastic change in the national agricultural policies of the Moroccan Government, such as, for example, radical changes in the system of prices and subsidies that would render investments under the Project economically unviable. On the basis of the conclusions of the recent sectoral survey, such a radical change is very unlikely because of the Government's present policy to streamline the subsi- dies system and to eliminate incentives for investments that would not be economically justified. Third, the economic justification of the investments under the Project is based on the existing availability to the farmers of a technical package, in addition to credit, and especially of extension service. The assumptions on technological change under the Project are conservative, being based on presently applied techniques and inputs and on the rather average quality of this extension service (CNCA staff being however the main 1/ Report no. 1357 issued November 18, 1976. - 26 - source of technical advice on livestock matters, at least to HQ/CRCA clients). The extension service needs to be strengthened, and such an improvement would result in faster technological change, and thus higher output than assumed. Should the quality of the extension service deteriorate from its present condition, the economic justification of the Project may suffer. However, such a deterioration is very unlikely in view of the past and present trends of improvement of the extension service. Fourth, CNCA is a financially viable institution, thanks in part to the financial support it receives from the Government. It is therefore financially quite dependent (but operationally very independent) of the Government. Termination of this Government support is totally unlikely, but the Government may require CNCA to undertake costly programs, such as a very fast imprudent expansion of its CLCA network. While this is not entirely impossible, CNCA financial viability would be safeguarded by the covenants requiring it to raise its financial charges accordingly (paras. 6.09 and 6.12). This risk is therefore limited. Fifth, actual farmers' preferences may differ from those assumed now and the outlook of the Project would therefore change. The overall increase in production under the Project would be more the result of an intensification of farm operations, than of an expansion, for which there is limited scope in Morocco, and this is unlikely to change. Some substitution of Project funds for other funds would undoubtedly occur, reducing somewhat the incremental impact of the Project; an overall substitution rate of 10% to 20% would appear more reasonable and more in line with general data available (Annex 5, Table 1) than the rate of 25% to 50% reported by OED for the first Project. All these risks appear therefore rather limited and would not affect significantly the viability of the Project. The Project would be "promotional" and introduce some improvement in farm tech- nology with respect to only some of the subborrowers, namely the Cooperatives and associations' members, the farmers borrowing through ORMVAs and SPs and most of the CLCA clients; it would not achieve such objectives as far as the HQ/CRCA clients are concerned. 7.09 The Project would further result in non-quantifiable institutional benefits to both agriculture in general and CNCA in particular: (a) The Project would support institutional building within CNCA; it would also provide funds for technical assistance to CNCA, thus helping to improve substantially CNCA performance as an agricultural credit institution. (b) The Project would contribute to the strengthening of Coop- eratives and associations by helping to set them on a sounder financial basis. (c) The Project would provide funds for applied horticultural research in the Massa region and thus help support the development of production in this irrigation system. - 27 - VIII. AGREEMENTS REACRED AND RECOMMENDATIONS 8.01 To ensure successful Project implementation, the following major assurances were obtained during negotiations: (a) CNCA would maintain a competitive compensation system and the Government would provide CNCA with sufficient qualified agricultural staff (para 6.02); (b) CNCA would introduce new lending policies and procedures and new financial charges, as outlined in paras 6.03 to 6.12; and (c) CNCA would set up a monitoring and evaluation system to measure the impact of the Project (para. 6.15). 8.02 A special condition of effectiveness of the proposed Bank Loan would be that the new lending policies and procedures and the new financial charges be approved by the Administrative Council of CNCA. 8.03 The Project would be suitable for a Bank Loan of US$35 million equivalent to CNCA for a term of 13 years with three years of grace. ANNEX 1 Page 1 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO The Agricultural Sector 1/ A. General Description & Performance General 1. Morocco has a total land area of 50 million ha. 2/ Cultivable land in Morocco during the 1970-75 period totaled 7,635,000 hectares, of which 5,285,000 hectares were sown; 1,780,000 ha were fallow and 565,000 ha were fruit tree plantations. Winter crops, mainly wheat, barley, broad beans and sugar beet, represent 82% of the sown lands, while summercrops account for only 18%. Rainfed lands are equally distributed between high rainfall areas of more than 350 mm of rain per year and low rainfall areas of less than 350 mm of rain per year. In the low rainfed areas, only grain is grown, mainly barley and a small amount of pulses. Fallow varies from one year to the next, becoming larger when the rainy season starts late. 2. The modern sector, including the State farms (SODEA, SOGETA, etc.) accounts for about 1.5 million ha (20%) of which 900,000 ha are sown lands, 200,000 ha are plantations and 400,000 ha are fallow. The traditional sector, covering most of the farmers, accounts for 6 million ha, of which 4 million ha are sown lands, 400,000 ha are plantations and 1.6 million ha are left fallow. 3. Most of the cultivated lands are west of the Atlas and Rif mountains. The climate resembles the Mediterranean type in the North. Aridity increases towards the South, becoming desert-like with only oasis-type agriculture east of the Atlas mountains and in the extreme south. Out of 7.6 million cultiva- ble hectares, irrigable lands represent about 12%; most of the industrial crops, forage crops, vegetable crops and citrus plantations are grown under irrigation which provides almost all exports of agricultural products. Rain- fed land, 88% of the cultivable land, mainly produces grains, legumes, and oil seeds plus olive trees and vineyards. Livestock is mainly cattle, sheep and goats; intensive livestock raising is the exception, mainly for milk and meat I/ Additional information is available in the Morocco Agricultural Sector Survey. 2/ 1974 borders. ANNEX 1 Page 2 production near the consumer centers. However, its development during recent years has been increasing. 4. Agriculture contributes between 25% and 30% of the Gross Domestic Product depending upon the year's results: 2/3 from crops and 1/3 from live- stock. Value added accounts for 75% to 80% of production. Agricultural ex- ports (including processed products) accounted for about 50% of exports until 1973; due to the increase in phosphate prices, this proportion decreased to about 22% of total exports. Imports of agricultural products account for about 25% of total imports. The trade balance in agricultural products was positive until 1973 (1.5-1.9 coverage'depending upon the years) but was nega- tive in 1974 (0.73 coverage) and 1975 (0.5 coverage). Total investment in agriculture is unknown but planned investment by the central Government (in- cluding regional development projects) accounts for 20.6% of total investment (6% of total being for hydraulic works); actual central Government expendi- tures amounted to 29% of total for 1973 and 1974. The growth rate for agri- culture is lower than for the overall economy, essentially because of the low grain yields in the traditional sector. 5. In 1971 (last census) 9.8 million people out of 15.2 million Moroccans (65%) lived in rural areas; the growth rate of the rural population was 1.6%, compared to the national average of 2.4%. 47% of the rural popula- tion was 15 years and younger. 6. The rural labor force amounted to 2.6 million (65% of total) of which 5% were officially unemployed (9% at the national level). Almost 2 mil- lion people were employed in agriculture (55% of total employed) including 670,000 as family help. They were divided among the following activities. (In thousands) Urban Areas Rural Areas Total Fishing 8.2 5.5 13.7 Forestry, hunting 2.7 14.8 17.5 Crops 45.2 1,574.2 1,619.4 Animal husbandry 4.3 333.3 337.6 Total 60.4 1,927.8 1,988.2 Percent of Total Employed 5.1% 78.9% 54.7% 7. More detail on production and trade is available in the Agricultural Sector Survey (see also Table 1). Comprehensive Crop Programs 8. Sugar beet, sugar cane, cotton and sunflower belong to the compre- hensive crop programs. The Regional Land Development Agencies (ORMVAs) for irrigated perimeters and, to a smaller extent, the Provincial Offices of the ANNEX 1 Page 3 Ministry of Agriculture (SPs) for rainfed land (or land irrigated from wells) are responsible for managing these programs. They provide seeds, fertilizers, extension, mechanization services to the farmers who have to follow technical directives from the extension agent, especially in respect to their cropping pattern. All production has to be sold to the processing plants at a guaran- teed support price. Hybrid corn production on irrigated lands is also under such a program. Alfalfa and, in the Souss-Massa region, early tomatoes and other vegetables are also covered by similar programs (but their prices are not guaranteed). Short-term loans for these crops are provided by CNCA, through ORMVAs and SPs, which are responsible for recoveries by deduction from the payments to farmers for their production. In a few cases (establishment of sugar cane and alfalfa plantations), medium-term loans are also provided by CNCA in the same manner. Development Objectives 9. The major objective of the 1973-77 plan is to sustain a real GDP growth of 7.5% per year. This would be accomplished mainly through a fast rise in exports and a large increase in investments. The main objectives for agriculture are: (1) to increase locally-consumed agricultural production in order to reduce imports of agricultural products; (2) to increase the per capita revenue for rural population by increasing the speed with which irrigated lands al- ready equipped are put under irrigation and (3) to speed up rainfed agriculture and livestock development. Such targets require a strong emphasis on agrarian reform, more technicians in the agricultural sector, development of agricultural research, extension and agricultural credit, improvement of marketing both for local markets and for export and higher prices for agricultural products. 10. In March 1974, the King expressed strong criticism of the Ministry of Agriculture for having increased the irrigated areas by only 20,000 ha per year, and he assigned a new target of 45,000 irrigated hectares per year with- out modifying the emphasis on assistance to rainfed farming and livestock raising. As a result, a Department of Infrastructure was created in August 1974 in the Ministry of Agriculture to be responsible for the progress of irrigation projects. In November 1974, the King decided upon the adoption of a sugar plan and of several measures to increase oil seed production, so as to reduce imports of these two commodities. In order to implement the policy directives outlined by the King, the 1975 finance law greatly increased the budget appropriation for agriculture, bringing total appropriations under the plan from DH 2.23 to DH 3.57 billion; at the same time, the budget appropria- tion for the Department of Hydraulics in the Ministry of Public Works was in- creased from DH 0.60 to DH 1.48 billion. Another Government measure designed ANNEX 1 Page 4 to encourage agricultural production was an increase in farmgate prices. The Agricultural Sector Survey provides a detailed analysis of the conditions for further agricultural development. Organization 11. Government activity in the agricultural sector is the primary respon- sibility of the Ministry of Agriculture and Agrarian Reform (MARA). There are also several state-owned companies responsible for agricultural and livestock production. One of the most difficult problems is the lack of qualified agricultural technicians and engineers; a large-scale training program is underway. Extension 12. The technical centers responsible for agricultural development and extension work are the "Centres de Travaux" (CT) in the rainfed areas (Bour lands) and "Centres de Mise en Valeur" (CMV) in the irrigated perimeters. The CTs are regrouped in each Province under the Provincial Office (Services Pro- vinciaux-SP) of the Ministry of Agriculture and the CMVs are in each irrigated perimeter under the Agricultural Land Development Agency (Office Regional de Mise en Valeur Agricole-ORMVA). There are 78 CTs covering 20.1 million ha (258,000 ha on the average, but ranging from 24,900 ha near Taza to 2.5 mil- lion ha near Figuig) and about 180 CMVs covering 500,000 irrigated hectares (2,780 ha average) plus a small amount of rainfed land. As irrigated land is more intensely cultivated and given a higher priority, CMV staff is pro- portionally more important than CT staff. The higher density of staff in CMVs compared to CTs is also due to a greater work load in the CMVs because of the comprehensive crop programs (sugar beet, sugar cane, cotton, sunflower and hybrid corn) (see para 8); most of these crops are grown under irriga- tion. 13. Agents of the CTs and CMVs, in addition to their work under the comprehensive crop programs, are responsible for extension work, sale of selected seeds and fertilizers, sale of small equipment, and provision of subsidies. They also provide mechanization services. These different opera- tions represent an important aspect in the role of the extension agents; they lead to closer contact with the farmers, a pre-requisite to extension work. Selected seeds could represent a large contribution to agricultural develop- ment, mainly for wheat and barley production (75% of cultivated land) but their impact on production has not yet been perceived. During the last five years, CTs and CMVs have been developed and equipped and a real improvement has been achieved due to closer contacts with the farmers. More centers and more equipment are necessary, both on irrigated and on rainfed lands, to in- crease extension impact on agricultural production; in the same manner, stronger action for selected seeds is needed in order to have a real effect on Moroccan production. ANNEX 1 Page 5 Farmers' Associations for Mechanization 14. Farms too small to justify ownership of a tractor may obtain mech- anization services from extension centers, from custom operators or from large farmers. Since 1968, they may also form pre-cooperative groups for joint ownership and for use of a tractor and its implements (also in a few cases a combine harvester). 383 such groups had been created by end 1975 with 2,800 members (143 groups with 1,370 members under CMVs and 240 groups with 1,430 members under CTs) most of them (75%) created before 1971. Only about 260 of those received credit (an average of DH 31,000 per group) and about 210 are still in existence. Each group had on the average 7 members (actually between 4 and 32 members), the average land per farmer being 16.7 ha rainfed and 4 ha irrigated land. The 383 groups had acquired 351 trac- tors, 254 plows, 346 disk arrows and 19 combine harvesters. The groups are usually created at the instigation of the extension agents. The groups receive a subsidy from the Government and a loan from CNCA (72% of cost at 7% interest rate, versus 70% of cost at 8.5% for individual farmers). Joint ownership of equipment creates problems in priority of use, and the number of groups created is relatively low. Despite the reluctances of farmers and the difficulties in creating such groups, it seems necessary that more emphasis be given by the Ministry of Agriculture to the creation of new groups and that more extension agents be assigned to this task. The forecast of 218 groups to be created in 1976 seems highly unrealistic. Prices & Subsidies 15. To encourage agricultural production, farmgate prices for the most important commodities are either fixed or are above a fixed support price. Prices are revised each year. In 1975-76 the fixed price for sugar beet was raised from DH 76 to DH 96 per ton, for sugar cane from DH 59 to DH 65 per ton, and for sunflower seed from DH 90 to DH 130 per quintal. For fresh milk, the price was raised from DH 0.67 to DH 0.85 per liter during the peak produc- tion period from February to July and to DH 0.95 during the low production period from August to January. Cereal prices were substantially raised; the fixed price of bread wheat was set at DH 60 per quintal, and the support price for durum wheat, which can be bought and sold directly, at DH 63 per quintal. 16. The Government has to spend very largè amounts to maintain low con- sumer prices (especially wheat, sugar, edible oils and butter) while guarantee- ing prices high enough to producers. DH 2.1 billion were spent for this pur- pose in 1975. A significant transfer of resources thus takes place from the general taxpayer to consumers, i.e., essentially to the urban population. In view of the unfavorable terms of trade of agriculture vis-a-vis industry. im- portant subsidies are also paid for inputs, especially fertilizers. Subsi- dies are paid as well for investments mostly to cooperatives and groups (com- bine harvesters 20%: tractors, implements and most other agricultural ma- chinery 30%; small implements 50%; imported cows 20%) and to individual ANNEX 1 Page 6 farmers (pickup balers, mowing machines, sprayers, seeders 20%; small imple- ments 50%). Other subsidies are also paid when investments for land conser- vation, pasture improvement, orchards and others are undertaken, but these are paid as working capital subsidies. The impact of these subsidies remains to be assessed as well as their distribution among subsectors and classes. (see Appendix 1.2). B. Farmers' Incomes & Agrarian Reform Land Distribution 17. Data on farmers' income and land distribution is doubtful and some- times incoherent. Land distribution is skewed, but there are practically no latifundia: less than 0.5% of the farms are above 50 ha, accounting for 10% of the land. Distribution of Arable Land /1 (Thousand hectares) Number of Size (ha) Owners % Area % Less than 1 430,500 23.1 231 3.9 1 - 2 224,250 12.0 346 5.8 2 - 5 303,900 16.3 1,010 17.0 5 - 10 154,810 8.3 1,103 18.6 10 - 20 73,640 4.0 1,018 17.2 20 - 50 25,980 1.4 743 12.6 50 - 100 4,700 .3 311 5.3 100 - 500 1,760 .1 276 4.7 More than 500 30 -- 16 .2 Collective 643,470 35.5 868 14.7 Total 1,863,040 100.0 5,922 100.0 /1 Excludes land in private domain of State (SODEA, SOGETA, etc.) and rangelands. Land Ownership 18. The Moroccan land tenure system is quite complex. One can dis- tinguish: (i) "melk" land: private land. The farmer may have a modern or a traditional land title. ANNEX 1 Page 7 (ii) collective land: the land belongs to the collectivity as a whole, but the right to farm the land belongs to individuals who have a medium-term lease (2 to 5 years). Almost all range lands are collective lands. (iii) "guich" land: the land belongs to the collectivity as a whole, but it is given under long-term leases to veterans, former court servants and the like. Guich land is mostly around the cities. (iv) "habous" land: the public habous land (waqf) has been given to a religious charitable institution by an individual and is rented to farmers. The private habous land will revert to the religious institution when there are no more male descendents of the donator; in the meantime, it is farmed by the family. (v) State land: this is the private land of the State (as opposed to the land of the collectivity and to the private land of the King). It includes the land confiscated from foreigners. (vi) other lands: this includes land owned by private companies, land owned by Moroccan Israelites and others. Land Tenure 19. There are essentially three types of farming: (i) direct farming by the land owner; this is quasi-compulsory on irrigated land under the ORMVAs. (ii) tenant farming: a fixed rent is paid by the farmer. This is the case essentially on State and public habous land. (iii) sharecropping is done in three different ways: (a) Khobza: the absentee landlord forms an association with one or several sharecroppers to work on his farm; they share the crop in a proportion fixed in the contract. The Khobza sharecropper may himself employ a Khammes share- cropper. (b) Khammes: the landlord provides seeds, fertilizers, water and sometimes draft animals and implements; the share- cropper often provides draft animals and implements and receives one-fifth of the crop. Usually the landlord farms part of his land himself and gives the rest to a Khammes. Page 8 (c) Due to the shortage of labor, the Khammes systern has evolved into a new system in the case of labor-intensive activities such as livestock and vegetable cultivation, whee the sharecropper is a foreman providing his own crew and receiving one-fourth of the crop. Employment & Poverty Level 20. About 1.3 million farms (68%) do not employ any salaried labor, but only family labor; 92% of these are below 10 ha. About 125,000 farms (6.5%) employ 190,000 permanent workers (1.5 per farm). 32% of the farms employ seasonal labor for 80.5 million working days (81% male, 19% female). 676,000 farms (35%) do not market any output; 93% of these are below 10 ha. These 676,000 farms can be assumed to be at the subsistence level, not integrated into the economic circuit, not generating any cash and probably unable to have access to credit. 21. On the basis of the 1970-71 income survey, the absolute poverty income level in 1975/76 was estimated at $1050 per family. Fiscal Income 22. The actual income of farmers is always very difficult to estimate. In Morocco the tax authorities have devised a fiscal income, which is a no- tional income computed on the basis of the land, the number of heads of live- stock and the fruit trees owned by the farmer, and whether land is rainfed or irrigated, cultivated in a modern or in a traditional way. Norms per hectare, per head or per tree are applied for each commune on the basis of soils, rain- fall and climate. Each year the tax authorities make a census of the assets of each farmer and compute its fiscal income (on the basis of which tax is paid, see para 24). This income is different from the.real income partially because some improvements in the farmers' economic conditions are not regis- tered (e.g., purchase of 2 mules instead of renting them, or chicken breed- ing), partially because the norms are averages not taking into account a farmer's productivity (thus encouraging him to be more productive by not tax- ing him more)--but mostly because the norms are underestimated and have not been changed since 1963. 1/ This is in line with the policy of not taxing the agricultural sector too much. It can be estimated that the fiscal income is about 40% of the real income for the farmers having a fiscal income below DH 3,000. The fiscal income criteria is used by the CLCAs for determining loan amounts (see Annex 2 para 40). 1/ Also it doesn't take into account non-farm income (about 25% of total family income for farmers below poverty level). ANNEX 1 Page 9 23. The average fiscal income for all farmers is about DH 1,000. By size of holdings, the fiscal income is approximately: Cultivable Land (ha) Average Fiscal Income 0 200 0- 5 770 5 - 10 1,500 10 - 20 2,400 20 - 50 4,350 50 - 100 9,300 above 100 31,500 Thus it can be assumed that CLCA clients (below DH 3,000) are farmers with less than about 15 ha of cultivable land. 24. The tax rates are very low as a result of the deliberate policy of not taxing heavily the agricultural sector. Fiscal Income Tax Rate Part of income below DH 1,400 0% between DH 1,400 and DH 6,000 8% DH 6,000 and DR 12,000 10% DH 12,000 and DH 24,000 12% " DH 24,000 and DH 48,000 15% DII 48,000 and DH 120,000 17% above DH 120,000 20% The highest tax rate on personal income is 36%. The agricultural tax has yielded a fairly stable amount varying between DH 63 million (1960, 1968) and DH 35 million (1966) in eurrent Dirhams (average 1960-1975 DH 47.6 million). The agricultural tax has declined in relative importance: total direct taxes increased from DH 242 million in 1960 to DH 2,736 million in 1975; total cen- tral Government current revenue increased from DH 1,250 million in 1960 to DH 8,538 million in 1975. The agricultural tax, which accounted for 26% of direct taxes and 5% of total Government revenue in 1960, had decreased to 1.5% of direct taxes and 0.5% of total Government revenue by 1975. Agrarian Reform 25. The Agrarian Reform Program 1/ took shape as a response to the grad- ual nationalization of land held by foreigners. Its objective is to reverse the past trend towards increasing fragmentation of holdings through land con- solidation and to redistribute lands expropriated from previous owners, there- by encouraging investment for agricultural development. The basic idea of the 1/ See Economic Report 329-MOR (February 7, 1974) pages 68-74 for a more comprehensive coverage. ANNEX 1 Page 10 Program is to distribute private State land to landless agricultural workers or subsistence level smallholders and to organize them in small cooperatives. 26. At the time of Independence, there were more than 900,000 ha of mostly prime and technically well-managed agricultural land in the hands of foreign settlers (627,000 ha "melk" private lands acquired from Moroccan landowners, 250,000 ha "colonization lands", i.e., former collective land sold at low prices to French settlers, and 31,000 ha "APJ-SEG" land allo- cated without charge to French settlers and to a company). After Independ- ence (1956) foreign owners sold back about 300,000 ha of private "melk" land to Moroccan farmers until this was regulated in 1963, the purpose of the regu- lation being to ensure that the private transfer did not exclusively benefit the well-off Moroccan farmers and to keep a stock of land for later distribu- tion to poor farmers. Between 1956 and 1960 the 31,000 ha of "APJ-SEG" land were recovered and distributed to small farmers (first phase). Between 1963 and 1965, 220,000 ha of "colonization land" were recovered and managed by a state agricultural company (CGEA) which was to be financed under the First Agricultural Credit Project; in 1966, this land was turned over to the prov- incial authorities. The Agrarian Reform Law of 1966 (second phase) provided for the distribution of this land (and of some "habous" land), which was finished by 1973 except for plantations which are managed by SODEA. A 1973 law provided for the recovery of the remainder of the foreign-held land (about 360,000 ha); the bulk of this land was entrusted to SOGETA (which was created for this purpose), but plantations were given to SODEA. A new land reform law (1972) provided that this land should be distributed to poor farmers (third phase). 27. Out of about 611,300 ha recovered, 267,750 ha have been distributed (as of early 1976); 69,950 ha are managed by SODEA and 85,000 ha by SOGETA. The remainder (about 188,600 ha) is either under temporary arrangement with the Ministry of Agriculture (of which 35,000 ha are rented to Moroccan farmers and 1,200 ha are rented to the former owners) or with other agencies or com- panies such as COMAGRI or agricultural schools (about 100,000 ha total). The 5-year plan calls for distribution of 400,000 ha by the end of 1977. About 20% of the land distributed so far is irrigated. 28. Beneficiaries of the Agrarian Reform must be Moroccans, work as small farmers or wage-earning farm workers, be less than 45 years old and natives of the region, or at least 5-year-old residents of the commune in which beneficiaries are chosen for land distribution; their revenue must be lower than the revenue of the plot they will receive. Beneficiaries must surrender any private land they own and abandon their rights on collective lands; the land they surrender increases the private State lands to be redis- tributed. Most of the beneficiaries are farm workers or sharecroppers. As a rule, all beneficiaries come from the poorer stratum of rural society and are living at subsistence level. Each beneficiary buys his plot on credit (20 years of which 3 years of grace), the repayment is indexed on the price of bread wheat (700 to 750 Q per plot). Until the price is fully paid, the ANNEX 1 Page 11 lot is mortgaged to the benefit of the State. Lots cannot be divided or sold except to the State. Only one heir can inherit the lot, but he must compensate other relatives. Plots are sufficient to provide an income of DR 4,000 a year in the beginning; this income should increase to DH 10,000 after 10 years. Plots range from 10 to 25 ha in rainfed land and from 4 to 7 ha in irrigated land. There have been about 18,000 beneficiaries (14.7 ha average per beneficiary) so far. 29. Beneficiaries have to be organized in cooperatives; there were 534 cooperatives existing at end January 1976, or an average of 33.4 members and 500 ha per cooperative. Each cooperative elects a president and an adminis- trative council; in addition, it receives the assistance of an agricultural technician, who is its director. Due to lack of staff, there is sometimes only one director for 3 or 4 cooperatives. The cooperatives are theoretic- ally in charge of providing inputs (seeds, fertilizer) and mechanization services (about 480 tractors and 40 harvesters were owned by cooperatives in September 1975) and selling output; their director provides exension services to the farmers. In fact, not all cooperatives are well organized; the rela- tionship between farmers and director is not always very good, and some coop- eratives are limiting their operations to the provision of mechanization services. The farmers do the procurement as well as the marketing by them- selves, individually. The cooperatives, in any case, are not large enough (even with a target membership of 50) to generate a volume of sales suffi- cient to defray overhead costs and the directors are paid by the Ministry of Agriculture. The limit to the size of cooperatives is often due to the medium-size of the recovered farm which can sustain no more than 35 to 50 families. 30. Each cooperative is supposed to prepare its own plan outlining its production and investment needs, both for itself and for its members. These plans are revised and modified at each level of the Ministry of Agriculture hierarchy and finally aggregated and presented to CNCA for financing. The cooperative members do not have access to credit individually. Short-term needs are financed by credit at 100% the first year, 80% the second year, 60% the third, 40% the fourth, 20% the fifth and are not financed thereafter. In case of a bad harvest, however, the financing ratio of the previous year is applied. Medium-term needs are financed at 100%; although it is said that replacement of equipment will be financed at 50%, this has not occurred yet, even though the older cooperatives are 10 years old. Investment usually con- sists of draft animals and small equipment for the members the first or second year, and of a tractor and its implements for the cooperative the second or third year. Livestock and other investments are financed in following years. CNCA appraisal is rather cursory, except in the case of unusual investments such as a second tractor or a collective stable. This credit system recog- nizes the total lack of funds of cooperatives and their members during their first few years of existence, but it is irrational since all the older co- operatives' own funds are used for their short-term needs and ineffective since the farmers who no longer have access to short-term credit decrease ANNEX 1 Page 12 their use of inputs and/or have to borrow from non-institutional channels at usury rates. All loans are guaranteed by the Agrarian Reform Fund, which is a Treasury fund consisting of the repayments of land by the beneficiaries (these repayments are not paid through CNCA, but through the tax system). Many loans (36% of total) committed at the request of the Ministry of Agriculture are never disbursed to the cooperatives due to changing needs. Recoveries are usually good. 31. The Agrarian Reform Program has been considered a priority in the Agricultural Sector and it has received a significant amount of resources in money and in personnel. Its first objective, to abolish foreign ownership of land, has been accomplished. However, its impact on rural poverty has been negligible: at the end of 1977, if the plan target is achieved, there will be at most 40,000 beneficiaries of the Agrarian Reform Program which would represent at most 4% of the landless workers and sharecroppers and subsis- tence level (less than 7 ha rainfed) farmers. The distribution of land owner- ship in Morocco being unequal, the Agrarian Reform Program has made but a small correction to this unequal distribution. The main result of the Agrarian Reform land distribution has been to create a rural middle class, whose income will be relatively high by rural standards and who will owe its status to the Government. The cooperatives' organization will probably need to be revised, their size enlarged through mergers, and their autonomy strengthened (coopera- tives' unions have already been created in two provinces, Fes and Meknes). Under this Project, their financing system would already be revised. 32. In the longer run, Morocco will have to envisage stronger measures to achieve more equal distribution of land, and first of all, some distribu- tion of private land held by large landowners. Considerable difficulties, both political and technical, would certainly arise in preparing and imple- menting a large redistribution program and the Government is very conscious of those. In the meantime, other measures to improve the distribution of growth benefits are implemented or planned. They include first those that are specific to rural areas: improvement of pastures and livestock produc- tion in the traditional sector, programs for integrated rainfed cropping (e.g., Meknes Project), promotion of small-scale production of fruits and vegetables for export and village development work programs. They also in- cludes measures benefitting the urban poor since poor rural families migrate to cities and national measures such as a more progressive system of income taxation and the introduction of inheritance taxes and land taxes, and in- creased social services. However, their impact will be relatively limited and it is likely that, short of redistributing land on a massive scale, the distributional and poverty problems facing Morocco will ouly be solved grad- ually in the long run. APPRAISAL OF ANN4EX 1 A THIRD AGRICULTURAL CREDIT PROJECT Table 1 MOROCCO Caisse Nationale de Crédit Agricole Cultivated Hectares, Production & Yields of Main Crops Grown in Morocco During the Last 3 Years 1972 - 73 1973 - 74 1974 - 75 Culti- Pro- Yield Culti- Pro Yield Culti- Pro Yield vated duction vated duction vated duction . 3 3 3 3 3 3 10 Ha 10 T Q/Ha 10 Ha 10 T Q/Ha 10 Ha 10 T Q/Ha Barley 2,016 1,255 6.2 1,973 2,387 12.1 1,819 1,585 8.7 Durum wheat 1,478 1,182 8.0 1,388 1,380 9.9 1,238 1,204 9.7 Bread wheat 562 392 7.0 528 473 8.9 453 371 8.2 Maize 446 217 4.9 447 390 8.7 492 371 7.5 Sorghum 53 52 9.7 70 88 12.4 58 75 12.8 Oats 20 12 6.0 19 20 9.9 32 27 8.8 Rice 3 10 39.0 4 12 32.2 6 29 47.1 Others 102 103 109 53 70 57 Total Grains 4,681 3,224 4,543 4,803 4,168 3,728 Broad beans 278 189 6.8 227 345 15.2 220 213 9.6 Chick peas 84 79 9.4 158 164 10.3 98 61 6.1 Dry peas 102 37 3.6 109 124 11.3 137 99 7.2 Lentils 31 il 3.7 40 27 6.8 46 34 7.1 Flat peas 41 26 6.4 38 32 8.4 46 3h 7.8 Others 16 il 6.9 13 12 9.2 14 8 6.1 Total Pulses 553 354 586 705 562 451 Sunflower 20 18 8.9 18 14 7.7 23 16 6.7 Linseed 2 1 7.2 2 3 15.1 2 2 7.4 Others 13 7 5.5 17 13 7.5 16 19 11.7 Total Oil Seeds 36 27 37 30 42 36 Sugar beet 45 1,293 287.3 58 1,944 336.6 62 1,792 288.5 Cotton 15 27 17.2 16 18 10.9 17 17 10 Others 12 6 13 8 18 63 Total Industrial Crops 72 1,326 87 1,970 97 1,872 Forage crops 62 81 84 Vegetable crops 111 111 94 Other crops 20 10 12 Fallow 1,593 1,641 2,097 Olive trees 269 269 295 Citrus 71 71 68 Vineyards 55 55 53 Others 162 162 125 Total Cultivable Lands 7,685 7,653 7,697 ANNEX 1 Appendix 1.1 Page 1 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO The Agricultural Sector Mechanization and Employment A. Tractors Introduction 1. Traditionally, all farming work was performed by human labor. Pro- ductivity and output were factors of the human energy applied to the land. Then man learned how to apply technology to increase the impact of human energy, e.g., man and the hoe; invention of the harness allowed the combina- tion of man and draft animals. Mechanization of Moroccan grain farms dates back to the 1920s and a substantial number of tractors were imported before World War II, mainly by European settlers. Extensive dry land grain produc- tion was possible on large farms, tractors were used to break the heavy soil and prepare the land in time to take advantage of the relatively short rainy season. Intensification and diversification of agriculture have broadened the use of tractors, on both irrigated land and rainfed land under modern agricultural cultivation. The use of tractors has been spreading from the modern to the traditional sector, from large to medium and small farms. 2. A recent rural census indicates that about 31.4% of all farms did not use draft animals or tractors, but supposedly only human labor (73% of those farms have no cultivable land and 25% have less than 5 ha cultivable land); 52% of all farms used draft animals only (78% of those have less than 5 ha cultivable land and 14% have between 5 and 10 ha) and 16.6% of all farms used tractors and other mechanical equipment (11.4% use only tractors and 5.2% use both tractors and draft animals). The breakdown of farms using me- chanical equipment in proportion to the total number of farms was as follows: ANNEX 1 Appendix 1.1 Page 2 Farms Cultivable land (ha) Using Mechanical Equipment % of which using only per farm % Inverse Mechanical Equipment Cumlnive (no draft animals) % 0 0.3 16.6 0.2 0 - 5 14.6 21.6 11.4 5 - 10 33.0 41.2 20.1 10 - 20 45.7 51.9 26.8 20 - 50 61.7 65.0 31.3 50 - 100 76.5 79.3 51.0 above 100 87.7 87.7 59.7 Total 16.6 - 11.4 /1 i.e., 65% of all farms above 20 ha use mechanical equipment. Tractor Supply and Population 3. Average annual sales of tractors for five-year periods since 1950 were as follows: Years Average Annual Tractor Sales 1950-54 1,217 1955-59 880 1960-64 525 1965-69 1,363 1970-74 1,697 The high sales in the 1950-54 period were mainly to European settlers. After Independence a public sector mechanization program was launched, involving replacement of machinery on farms taken over from European settlers by CGEA (about 500 tractors of which about half were financed under the First Agri- cultural Credit Project) and purchase of machinery for customs work by the extension centers, CTs and CMVs (Annex 1, para 12); by 1967, these extension centers had about 1,000 tractors (15% of total). Since 1967, the Governnent has reduced its public sector purchases and sales to private farmers and private custom operators have risen substantially. 4. A machinery census was made in 1969/70. The number of agricultural tractors in operating condition in 1970 was estimated to be 10,200, 20% of which were more than 10 years old and 14% 5 to 10 years old. In 1976, the number of tractors working for agricultural purposes can be derived from the 1970 data, from the number of tractors purchased after 1970 and from the as- sumption that in 1976, only one out of 6 existing tractors is more than 10 years old, compared to one out of 5 in 1970. ANNEX 1 Appendix 1.1 Page 3 of which Total Caterpillars Tractors more than 10 years old 3,083 1,000 /1 Tractors 10 years old 1,128 241 Tractors 9 " " 1,556 185 Tractors 8 " " 1,118 78 Tractors 7 " " 1,087 70 Tractors 6 " " 1,742 120 /1 Tractors 5 1,748 120 /L Tractors 4 " " 1,540 110 /1 Tractors 3 " " 1,590 110 /1 Tractors 2 " " 1,863 130 /1 Tractors 1 year " 2,045 /l 136 /1 No. of tractors in Operating Condition in 1976 18,500 2,300 /1 Estimates. 5. There are many tractor suppliers in Morocco. Tractors are im- ported either as such or in parts and then assembled in Morocco. All of the big international manufacturers are represented in Morocco and tractors are imported from the U.K., Sweden, the Soviet Union, East and West Germany, France, Italy, Romania, Spain and possibly other countries. Competition is active, and prices are thus kept low (prices are under the control of the Ministry of Agriculture). After sales service is adequate and covers all the territory in Morocco. 6. Assuming a tractor is able to work over 80 hectares on the average, the 18,500 existing tractors will work over 1.5 million ha and the remaining 4 million ha will be prepared with draft animals. In 1974, the draft animals were: mules 764,000 heads camels 100,000 heads donkeys 876,000 heads cattle, part of the 4,000,000 heads horses 232,000 heads Mules are the main draft animals in Morocco; assuming a working capacity of 12 ha for each pair of mules and 3/4 of the mules working for land prepara- tion, 286,500 pairs of mules will prepare 3.4 million ha. The remaining 0.6 million ha are prepared by both camels and donkeys and some cattle used as draft animals. Horses are used only for transportation and prestige, and not as draft animals. AINEX 1 Appendix 1.1 Page 4 Projected Demand 7. Tractor purchases have been forecast until 1981-82 on the basis of replacement of existing tractors (and progressive disappearance of tractors more than 10 years old) and of the need for new tractors for irrigated and rainfed land. As for the replacement of existing tractors, the life of a tractor is assumed to be 10 years although it greatly depends upon the driver and the mechanic's experience; it is also assumed that by 1980, the number of tractors more than 10 years old should be less than 5%. The number of re- placement purchases is therefore estimated at: Agricultural Year Replacement Purchases (CNCA Fiscal Year) Purchases 10 years before A B A/B 1975-76 1,625 1,128 1.44 1976-77 2,045 1,556 1.31 1977-78 1,630 1,118 1.46 1978-79 1,580 1,087 1.45 1979-80 2,240 1,742 1.29 1980-81 1,845 1,748 1.06 1981-82 1.635 1,540 1.06 Total 12,600 9,919 1.27 8. Of the 10,200 tractors existing in 1970, almost 4,000 were used on irrigated land. For each irrigated perimeter a norm of average land per tractor can be computed ranging from 29 ha in the Gharb, the Loukkos and the Souss-Massa to 100 ha in the Doukkala and 120 ha in the Haouz, with an aver- age of 75 ha (excluding the Tafilalet and Ouarzazate perimeters, where no tractors are used). On the basis of the forecast land to be irrigated, the need for new tractors can be determined for each irrigated perimeter (exclud- ing Tafilalet and Ouarzazate): ANNEX 1 Appendix 1.1 Page 5 Agricultural Year Area to be Number of Average Ha/ (CNCA Fiscal Year) Irrigated Tractors Tractor (Ha) 1975-76 55,565 1,155 48.1 1976-77 59,450 1,355 43.9 1977-78 45,410 1,170 38.8 1978-79 35,980 875 41.1 1979-80 35,980 875 41.1 1980-81 29,510 705 41.9 1981-82 29,505 705 41.9 Total 291,400 6,840 42.6 divided among: Gharb 89,440 3,085 29.0 Loukkos 34,920 1,205 29.0 Souss-Massa 28,650 990 28.9 Moulouya 20,660 385 53.7 Tadla 25,400 335 75.8 Doukkala 38,930 390 99.8 Haouz 53,400 450 118.7 plus Ouarzazate 1,500 - - & Tafilalet 12,600 The decrease in the average land per tractor is due to the relative import- ance of the three perimeters where use of tractors is the most intensive (more than 50% of future irrigated land). 9. On rainfed land, it is more difficult to forecast the number of new tractors to be purchased; rough estimates are: Agricultural Year Number of Tractors 1975-76 200 1976-77 220 1977-78 240 1978-79 265 1979-80 285 1980-81 210 1981-82 220 Total 1,640 10. The total number of tractor purchases for Morrocco is therefore forecast at: ANNEX 1 Appendix 1.1 Page 6 Agricultural Year (CNCA FIscal Year) Number of Tractors 1975-76 2,980 1976-77 3,620 1977-78 3,040 1978-79 2,720 1979-80 3,400 1980-81 2,760 1981-82 2,560 Total 21,080 Average per Year 3,010 CNCA will finance about half of these tractors. Of these, the Project would finance 2,120 tractors in 1977, 1978 and the first eight months of 1979. 11. As a result the number of tractors in 1982 would be 26,800 as fol- lows: More than 10 years old 1,242 10 years old 1,540 9 " " 1,590 8 " " 1,863 7 " " 2,045 6 " " 2,980 5 " " 3,620 4 " " 3,040 3 " " 2,720 2 " " 3,400 1 year " 2,760 Total 26,800 The purchases would have resulted in a significant improvement in the age of tractors, 58% being 5 years old or less versus 47% in 1976. It can be esti- mated that at most, 25% of all farms would by then use mechanical equipment. Effects of Tractor Cultivation: Microeconomic Approach 12. Farmers have tried to meet their draft power needs by using trac- tors for several reasons. Draft animals can be used only for a short period of time but their maintenance costs (fodder) throughout the year are high and diverted from other productive livestock, while tractors require operat- ing expenses (fuel, etc.) almost only when operated. The use of tractors also enables better land preparation, especially if rains are late and ploughing and cultivation must be undertaken when the soil is dry and hard. For each crop there is an optimum period for sowing, which is at the end of November for winter grain crops, the end of April for cotton and September for berseem; any delay in the sowing period will reduce the expected yields AJE1`X 1 Appendix 1.1 Page 7 and this factor is one of the main constraints for rainfed areas, which must await rainfall before they can be ploughed and sown. In 1974-75, the rains started only on January 5, which reduced wheat and barley production in large rainfed areas. One of the main advantages of irrigation is to allow for sowing at the best period. 13. Aside from timeliness, the quality of land preparation with trac- tors is superior to that obtained with draft animals and traditional imple- ments. With animal power alone, large areas cannot be planted at all in years of drought and late rain. Also, in critical periods, a tractor can be worked 24 hours per day, thus allowing high flexibility in peak periods while animals cannot work more than 8 hours per day. To quantify the advantages of tractor on draft animals for land preparation, experiments would be necessary, but an increase of 2 to 5 quintals of grain per hectare can be expected. An even greater increase in yield can be anticipated with advanced technology using a high fertilization rate and weed, pest and disease controls. Such ad- vanced technology would be worthwhile only in irrigated lands and good rain- fed areas such as the Fes and Meknes provinces. 14. On rainfed land, much of the land currently used for mechanized grain production would probably revert to extensive grazing of livestock if tractors were not available. The high risks and low returns inherent in traditional animal-power cultivation are not likely to keep such land in cereal production without tractors. On irrigated land, tractors could allow also for double-cropping, essentially of maize due to timeliness of land pre- paration. Tractors can also be used for transport. From the farmer's view point, it is clear that use of a tractor is a preferred alternative to use of draft animals (see Farm Model 6 Annex 4). Effects of Tractor Cultivation: Macro-economic Approach 15. It is clear that all the farmer's benefits of using a tractor are translated into economic benefits. Higher productivity of land, extension of cultivated land, shift to higher value crops, higher yields and smaller weather risks result in higher crop production; the release of fodder normal- ly used by draft animals results in higher livestock production. The ques- tion, however, is whether these benefits are balanced by the costs of mechan- ization and especially what the impact of tractors is on employment. 16. Direct Employment Impact. It is clear that the use of tractors result in higher productivity of labor, thus reducing labor preparation and seeding when measured on a per unit basis (per ha or per ton of output). However, the larger area cultivated and the higher yields obtained - thanks to mechanized cultivation - and the resulting higher output, increase the direct on-farm labor requirements. Labor is also still required for other activities. The following table shows the labor requirements in both cases. ANNEX 1 Appendix 1.1 Page 8 Working Days per Cultivated Hectare (Including Harvest) with Draft Animals compared to Mechanized Agriculture (Including Combine Harvester) Crops Working Days --------Mechanized Agriculture--------- with draft Hours of Hours of Combine =_____ Animals Working Days Tractor Harvester Wheat, barley & oats 31 9 8 2 Maize for grain 32 21 9 - Broad beans 24 14 9 - Peas 32 13 7.5 1 Chick peas, lentils 33 14 7.5 1 Vetch oats & barley 32 6 15.5 - Berseem 35 12 19.5 More complete data is given in Table 1. 17. Indirect Employment Impact. Indirect employment is generated in several ways. First, employment is created in the supply and maintenance of tractors either in the cities (e.g., assembly workers) or in rural areas (e.g., mechanics). Second, the increased production will generate additional work for provision of inputs and for transportation and marketing of output and through the multiplier effect on overall employment levels. Also, annual fluctuations of employment levels resulting from the risk of leaving large areas in fallow in case of drought and late rains will be eliminated. Final- ly, the additional fodder released from draft animals will increase livestock production and thus employment in the livestock subsector. It should also be noted that, if, without tractors, rainfed grain farm land would revert to ex- tensive grazing land, this would have a significant negative effect on labor. 18. Labor Supply. In Morocco as a whole, there is distinct unemploy- ment in urban areas; but the rural areas are mainly affected by underemploy- ment while there are severe seasonal labor shortages in agriculture during seasons of peak agricultural activities, especially harvest and seeding. So- cial constraints and the fact that peak demand for labor occur more or less at the same time in all the grain producing areas have limited possibilities of large-scale irrigation to meet these demands. As a result, it is becoming increasingly difficult to find available labor at certain periods and sala- ries during these periods have increased significantly (see para 30). Mechan- ization of land preparation and seeding reduces the peak demand for labor for these operations. 19. Conclusion. Unfortunately, the statistical data base of Morocco is not good enough to allow for a comprehensive study of the issue and most benefits and costs are difficult to quantify. It is only tentatively that one can express the conclusion that, in the Moroccan context, tractor mechan- ization does not have a negative but quite possibly a positive impact upon employment. However, as an illustration, a small case study has been made ANNEX 1 Appendix 1.1 Page 9 for the area covered by an extension center (CT) near Oued-Zem in rainfed grainland (see paras 32-35). Tractor Technology 20. Tractor technology is generally adequate but could be improved. Too much emphasis is placed on the offset disk for land preparation; it pro- vides a quick but superficial land preparation inappropriate to improved technology. Deep ploughing, at least for row crops such as sugar beet, cot- ton, maize and sugar cane, would be more profitable. 21. An excellent agricultural machinery school has been set up in Bouknadel with bilateral German assistance, graduating 50 technical agents every year; such a school will progresively improve the competence of me- chanics working in the Agricultural Sector. The main deficiency is the lack of experiments for land preparation. Land preparation is poorly done. The Agricultural Research Department has a central station responsible for better growing methods (Station Centrale des Ameliorations Culturales); most of the 181 different experiments concern fertilization, best growing period, density of plantation, etc. Only 8 experiments deal with land preparation It would be useful to start a practical research program to investigate tillage me- thods and to design implements suitable for Morocco, but this may prove to be difficult within the present organization of agricultural research. B. Harvesting Machinery Introduction 22. Mechanical grain harvesting has initially been developed in regions of dry land farming with low rainfall, low and uncertain yields, large fields and difficulty in attracting large numbers of workers for short periods. Ex- amples are found in large, semi-arid areas of the Soviet Union, Australia, Canada or the US, where nearly all cereals are harvested mechanically. Since physical conditions are somewhat similar in North Africa, it is not surprising that grain harvesters, introduced by the former European settlers, have spread throughout the commercial part of the agricultural sector. 23. It is assumed that to be economically viable, a harvester needs to be used on at least 100 ha: there are about 3,600 farmers owning or farming more than 100 ha of arable land in Morocco. With some allowance for custom operators, the maximum potential number of harvesters can be estimated at 3,600. Due to the existing land tenure, this number is not likely to change much in the near future unless the development of custom work expands very fast. ANNEX 1 Appendix 1.1 Page 10 Combine Supply and Population 24. Annual sales of combines for the past ten years were as follows: Year Number 1966 81 1967 56 1968 366 1969 257 1970 184 1971 209 1972 226 1973 125 1974 150 1975 170 1,824 Exceptionally high sales in 1968 are due to the record grain harvest for the year; similarly, since 1973 was a bad harvest year, the number of purchases decreased significantly. Projected Demand 25. A combine needs to be replaced every 9 or 10 years. Replacement purchases, usually made in the spring, would therefore number: Agricultural Year Number of Replacement Purchases (CNCA Fiscal Year) 1975-76 160 1976-77 230 1977-78 250 1978-79 140 1979-80 160 1980-81 190 1981-82 240 Total 1,370 26. On the average, replacement purchases account for 75% to 80% of all sales. New farms are being equipped with harvesters so that by 1982 about 62% of all eligible farms will use harvesting machinery (compared to 50% in 1975). The first purchases of combine harvesters can be forecast at: ANNEX 1 Appendix 1.1 Page 11 Agricultural Year Number of First Purchases (CNCA Fiscal Year) 1975-76 50 1976-77 70 1977-78 70 1978-79 40 1979-80 50 1980-81 55 1981-82 80 Total 415 27. The total number of combine harvester purchases would therefore be: Agricultural Year Number of Purchases (CNCA Fiscal Year) 1975-76 210 1976-77 300 1977-78 320 1978-79 180 1979-80 210 1980-81 245 1981-82 320 Total 1,785 CNCA would finance between 50% and 70% of these (or a total of 1,085), 285 of which would be refinanced by the Project during the period 1977-79. Effects of Mechanical Harvesting 28. All the combines purchased for replacement would not result in any displacement of labor. In theory, the already-mechanized farins could revert to hand harvesting. On such farms, however, it would be impossible to mar- shal the labor force required to harvest on a timely basis. With traditional grain harvesting of 100 ha, a farmer who would procure 10 to 12 laborers at harvest time (he would have no employment for them the rest of the year) would need 100 work days (115-140 calendar days) to complete the harvest. Even more work days would be needed in the years to come since harvest will occur during the fasting month of Ramadan. This would greatly exceed the period of optimal maturity, and harvest losses through waste, birds, insects and rodent damage would be excessive. To be able to harvest in two weeks (12 working days), 85 to 100 workers would be needed. Since all grain mature during the same short period, and because of social constraints preventing migration from the cities to the country-side, few farmers reverting to hand harvesting could mobilize sufficient manpower for the harvest season. 29. In the case of farms purchasing a combine harvester for the first time (usually farms having rented one before), the free capacity of the ANNEX 1 Appendix 1.1 Page 12 rental harvester could be used on farms which previously relied upon hand harvesting. In this case, some displacement of seasonal labor would occur. It can be estimated that each combine harvester would displace about 3,000 working days (60 people for 50 days). 30. The shortage of labor in agriculture at peak periods, especially during harvesting, mentioned above (para 18) has become dramatie over the re- cent years due to increased migration to the cities or to Europe for want of better jobs and salaries. While the average agricultural salary for men is DH 6.5/day, at harvest time such salary increases to DH 25 to 30/day, plus four meals a day. Migration occurs, especially from the mountainous regions (where crops mature later) to the central grain region. Due to the shortage of seasonal labor, not only do prices increase but the seasonal laborers are able to impose their conditions for food and accommodation. As a result, an increase in the number of combine harvesters would appear justified in view of the shortage of labor (see case study below). 31. The principal advantage of a combine harvester is the reduction of losses and improvement of quality, as compared to the traditional harvesting and threshing methods. Harvesting takes place during the high summer heat, and delayed or slow harvesting results in serious losses. Losses and damage due to animal trampling are also eliminated. This reduction of losses can be estimated at 100 kg of grain per hectare as a minimum. C. Case Study: Oued-Zem 32. This case study concerns the area covered by the extension center CT 10.07, located in Boujad near Oued-Zem in the central grain-producing re- gion of Morocco. Tables 2 and 3 give the basic data concerning the 332,679 ha and the 26,000 farmers in the area. A distinction is made between inten- sive, semi-intensive and extensive farms. The farm size distribution is as follows: Farm Size Cultivated Land % (Ha) 0 - 5 ha 10,798 7.1 5 - 10 ha 22,312 14.8 10 - 20 ha 42,712 28.3 20 - 50 ha 46,020 30.4 50 - 100 ha 22,000 14.6 above 100 ha 7,330 4.8 151,172 100.0 ANNEX 1 Appendix 1.1 Page 13 33. Labor requirements per crop with and without mechanization are given in Table 1. Livestock necessitates one permanent shepherd per family. Tractors and combine harvesters are utilized on intensive farms; tractors and sheaf-binding harvesters are utilized on semi-intensive farms (in addition to draft animals). Only draft animals are used on extensive farms. The working capacity of each family is one shepherd and one working man (25 working days/ month) all year round. 34. Table 4 shows the monthly labor requirements for crop cultivation (livestock excluded). Since the labor utilization coefficients are average for one month, additional labor may be necessary for a few days during the month when the coefficient is above 85%. Thus about 519,000 man days of ad- ditional labor are needed, almost all on intensive or semi-intensive farms only. About half of the labor requirement (259,000 man days) may be met by additional family labor or transfers of labor between farms in the region (it is only in June that the region as a whole has a deficit of labor). About 260,000 man days would be missing, all of them in July -- 125,000 in inten- sive farms and 135,000 in semi-intensive farms. This deficit: can be met by the employment of seasonal labor (10,000 laborers at least) or by the pur- chase of more combine harvesters. In fact, only about 8,000 laborers were forecast to be available in early June 1976, and therefore 20 more combine harvesters would have been needed for a timely harvest. 35. As for tractors, the shortage of labor in the fall is not large enough in itself to justify an increase in the number of tractors, since the number of draft animals is sufficient for cultivation of the land (al- though barely so in the case of semi-intensive farms); thus more tractors would not displace seasonal labor, but would increse the underemployment of farmers in the area. APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO ANNEX 1 Appendix 1.1 The Agricultural Sector Table 1 Mechanization & Employment Working Days per Cultivated Hectare with Draft Animals compared to Mechanized Agriculture including Combine Harvester ------Draft Animals------- --------Mechanized Agriculture---------- Crops Working Days of which for Working Days Hours of Hours of Combine Harvest Tractor Harvester Wheat, barley, oats 31 15 9 8 2 Maize for grain 32 15 21 9 - Rice - - 41 16.5 2 Broad beans 24 10 14 9 _ Peas 32 10 13 7.5 1 Chick peas, Lentils 33 10 14 7.5 1 Vetch oats & barley 32 5 6 15.5 Bersim 35 il 12 19.5 Alfalfa - 35 24 Maize, forage & - -- 22 12 Sudan grass - 75 13 Sugar beet - - Sunflower - - 20 15 Cotton - - 123 10 Sugar cane: lst year - - 28 11.5 Following years- - 105 18 Tobacco 187 100 156 15.5 Citrus: lst year - - 70 18 Years 2 to 5 - - 34 3. Year 6 onwards - - 76 9 Olive trees: lst year - 27 18 Years 2 to 5 - - 7 3 Year 6 onwards - - 64 6 Table grapes: lst yr - 37 18 Years 2 to 4 - - 40 3 Year 5 onwards - - 70 6 Early tomatoes (ribbed)- - 345 9 Early tomatoes (smooth)- - 540 l/ 9 Early potatoes - 130 17 Early squash - 136 7.5 1/ Three permanent workers during 6 months APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT ANNEX 1 MOROCCO Appendix 1.1 Tahle 2 The Agricultural Sector Mechanization & Employment Case Study: Oued-Zem Basic Data Intensive Farms Semi-intensive Farms Extensive Farms Total Villages 3 4 4 il Farms (families) 6,187 9,513 10,300 26,000 People 30,000 45,000 50,000 125,000 Area (ha) 64,576 123,539 144,564 332,679 Area per farm (ha) 10.4 13.0 14.0 12.8 Cultivated land (ha) 45,839 58,304 46,864 151,007 of which rainfed(ha) 45,614 58,117 46,836 150,567 irrigated(ha) 225 187 28 440 per farm (ha) 7.4 6.1 4.5 5.8 Plantations (irrigated ha) 130 35 -- 165 Grazing land (ha) 8,607 35,000 55,000 98,607 per farm (ha) 1.4 3.7 5.3 3.8 Forests & other (ha) 10,000 30,200 42,700 82,900 per farm (ha) 1.6 3.2 4.1 3.2 Livestock Cattle 11,968 21,876 14,579 48,423 per farm 1.9 2.3 1.4 1.9 Sheep 105,429 169,393 119,968 394,790 per farm 17.0 17.8 11.6 15.2 Goats 10,198 18,811 35,219 64,228 Mules 9,500 11,420 14,080 35,000 per farm 1.5 1.2 1.4 1.3 Camels 753 778 737 2,268 Tractors 100 34 - 134 Combine harvesters 8 - 8 Extension agents 22 Area per extension agent 15,120 (ha) Cultivated land per 6,865 extension agent (ha) Farms per extension agent 1,180 APPRAISAL OF A THIRD AGRICULTUTRAL CREDIT PROJECT ANNEX 1 Appendix 1.1 MOROCCO Table 3 The Agricultural Sector Mechanization & Employment Case Study: Oued-Zem Land Cultivation (ha) Intensive Farms Semi-Intenaive Farms Extensive Farms Total Rainfed Crops Durum wheat 10,000 20,099 7,151 37,250 Bread wheat 14,642 7,568 - 22,210 Barley 10,000 20,000 20,000 50,000 Forage 700 300 - 1,000 Peas 200 150 - 350 Broad beans 22 - - 22 Lentils 50 - - 50 Fallow 10,000 10,000 19,685 39,685 Subtotal 45,614 58,117 46,836 150,567 Irrigated Crops Potatoes 46 38 6 90 Onions 23 19 3 45 Tomatoes 29 25 4 58 Carrots & turnips 21 16 - 37 Alfalfa 20 - - 20 Miscellaneous 86 89 15 190 Subtotal 225 187 28 440 Plantations: olive trees 130 35 - 165 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT ANNEX 1 Appendix 1.1 MOROCCO Table 4 The Agricultural Sector Mechanization & Employment Case Study: Oued-Zem Labor Requirements of Crop Cultivation (Man Days) Intensive Farms Semi-intensive Farms Extensive Farms Total Manpower available 154,675 237,825 257,500 650,000 Tractor hours 82,825 34,875 - 117,700 Combine hours 4,800 - 4,800 Labor 1t Labor 1/ Labor Labor Requirements Requirements -/. Requirements _.1/ Requirements /0Lj September 200 - 2,700 1 400 - 3,300 0.5 October 70,000 45 128,700 54 70,400 27 269,100 41 November 163,500 106 204,300 86 100,400 39 468,200 72 December 68,100 44 206,700 87 59,900 23 334,700 51 January 112,200 73 144,300 61 75,400 29 331,900 51 February 34,800 22 90,600 38 61,200 24 186,600 29 March 800 0.5 2,700 1 400 - 3,9C0 0.6 April 200 - 2,700 1 400 - 3,300 0.5 May 5,400 3 201,000 85 100,400 39 306,800 47 June 327,300 212 418,400 176 248,900 97 994,600 153 July 169,100 109 90,600 38 61,200 24 320,900 49 August 200 - 2,700 1 400 - 3,300 0.5 Average 79,300 51 124,600 52 65,000 25 268,900 41 Need for Additional Labor November 32,000 2,000 - 34,000 December - 5,000 - 5,000 June 196,000 216,000 30,000 442,000 July 38,000 - - 38,000 Total 266,000 223,000 30,000 519,000 1/ of available labor APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT ANNEX 1 Appendix 1.1 MOROCCO Table 5 The Agricultural Sector Mechanization & Employment Case Study: Oued-Zem Yields (Q/ha) Intensive Farms Semi-intensive Farms Extensive Farms Yields Durum wheat 16 12 8 Bread wheat 15 10 - Barley 20 15 10 Forage 60 40 Peas 7 5 Broad beans 13 - Lentils 8 - Potatoes 150 Onions 100 Tomatoes 200 Carrots & turnips 100 Olive trees/tree 10 kg/tree Income (Excluding Livestock) Intensive Farms Semi-intensive Farms Extensive Farms Total Total net income 23,726 25,958 9,626 59,310 (DH'000) Net income (DH) per working day 25.0 17.5 12.4 18.4 per family 3,835 2,730 935 2,280 ANNEX 1 Appendix 1.2 ]'age 1 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO The Agricultural Sector Agricultural Marketing 1. The Moroccan market for agricultural products is representative of the mixed economy in which it operates. Domestically, it presents a combina- tion of free market forces and State controls. Generally speaking, the State will exert control on certain market elements (quality, price, distribution) for products which are considered of primary importance to the economy (grains, pulses, milk, meat). Crops whose transformation process require heavy capital investments will have all their market elements being control- led by the State. These are the so-called "industrial crops" such as sugar beet, sugar cane, cotton, sunflower, etc. Controls are exerted through a variety of Governnent institutions which have generally been set up along product lines. These agencies will report ultimately to the Ministry of Agri- culture and Agrarian Reform but are in fact relatively independent. A farmer can thus find himself dealing simultaneously with several agencies which pre- sent little cooperation among themselves. Secondary crops such as fruits and vegetables are not submitted to much control. 2. The export markets for most products fall completely under the con- trol of the Governnent-run Export Trade Company (Office de Commercialisation et d'Exportation - OCE). This agency carries out product quality controls, makes shipping arrangements and markets the produce abroad. Domestic Market Grains and Pulses 3. The market for grains and pulses is free but the channels of dis- tribution are regulated by the Cereals and Pulses Trade Office (ONICL - Office National Interprofessional des Cereales et Legumineuses). All produc- tion is sold at the local market to registered wholesalers, retailers, or flour mills. (Some leakages are nevertheless inevitable.) In the case of cooperatives, output is sold directly by them--or several growers may form their independent marketing cooperative and sell directly to the public, pro- vided they register with ONICL. This Office also regulates inventory levels of millers, growers, wholesalers and retailers 1/ and it levies a tax on the 1/ Cereals remain one of the Moroccan farmers' favorite hoards. Five-year- old stocks of wheat or barley are not uncommon. ANNEX 1 Appendix 1.2 Page 2 sale of all grains and pulses. ONICL also handles all imports and exports of grains and pulses. 4. In recent years, supply has not kept up with demand. The rapidly expanding population and the increased needs of a growing livestock herd have not been met by a parallel increase in the production of wheat and maize. Morocco is self-sufficient in durum wheat but the fragile equilibrium between supply and demand is endangered by climatic fluctuations. This situation has put the price of durum wheat under considerable upward pressure. For maize and bread wheat, the deficit has been increasing. Although ONICL expects the country to reach self-sufficiency in maize by 1980 (which would be feasible only on irrigated land), more than 1 million tons of wheat will have to be imported by then. 5. Prices are freely set by the market forces. The Government never- theless sets support prices for wheat, barley and maize. Should the market price fall below these prices, the farmer can sell this produce directly to the local SCAM office (Societe de Commercialisation Agricole Marocaine-- Moroccan Agricultural Marketing Society). In recent practice, however, prices for barley, maize and durum wheat have been persistently higher than the support prices. Those for bread wheat at harvest time have generally been lower than support prices. The SCAMS have thus become the main outlet for the output of bread wheat. Support prices and market prices are shown in Tables 1 and 2, respectively. Industrial Crops 6. Sugar Beet. Demand for sugar has grown continuously, as have im- ports. Only 50% of domestic consumption is met by local production. The market is state-controlled. All output has to be sold to the local sugar re- fineries at a pre-established price which varies according to the sugar con- tent of the beet. Each farmer maintains an account with the refinery which is credited with the proceeds from his sales and debited with the value of the working capital allowance extended to him (mostly in kind) by the ORMVA (Office Regional de Mise en Valeur) at the beginning of the year. Repayment of other outstanding debt connected with this crop which the farmer may have is also deducted from his account. 7. Sugar Cane. The market for sugar cane is organized by the Govern- ment. All output is sold to the two existing refineries at fixed prices. The first crop was harvested in 1975 and farmers have been somewhat reluctant to engage in it due to their lack of familiarity with it, to the difficulty of timely harvest and to difficult climatic conditions (flooding, frost). ANNEX 1 Appendix 1.2 Page 3 8. Cotton. Cotton production peaked in 1965 and then declined until the early seventies due to competition from sugar beet, irregular payments to the farmers for their crops and difficult parasite control. Production increased again to 27,000 tons in 1973, and then dropped to 17,000 tons in 1974 and 1975 in spite of efforts by the Government to increase production. The market is totally controlled by COMAPRA (Compagnie Marocaine de Commer- cialisation des Produits Agricoles - Moroccan Company for Marketing of Agri- cultural Produce). The Government created this company in 1962 and remains a majority shareholder. It purchases, transport, stocks, gins and processes raw cotton. All cotton is sold at a set- price to COMAPRA mills and the farmer receives the proceeds of his sale less any outstanding debts to ORMVA. Until recently, the administrative procedure was much slower and late pay- ments often forced the farmer to sell on the local market at a discount. Citrus 9. The market for citrus is free. Exports, however, make up the largest share (70%) of citrus plantation and are controlled by OCE (see para 17). Fruits not meeting export standards are sold on the local market at relatively low prices. Crops are sold to traders, processors or packing centers either "on the tree" or by the ton. Some growers have gathered to operate their own packing stations. Vegetables 10. The market for vegetables is free and distribution channels are patterned in the same manner as are citrus. Exports are handled through OCE and seconds are sold locally, along with the crops not qualifying for export due to their variety or their timing (summer tomatoes, e.g.). Seconds can also be sold to processing plants in the case of tomatoes (concentrate), carrots, beans and peas (canning). Little data is available on the domestic marketing of vegetable and citrus as this area is entirely in the hands of the private sector. Milk 11. Milk output has increased substantially over the past three years due in part to the importation of dairy cows. As a consequence of this in- crease and in order to promote local production, Government established im- port controls on dairy products. Supply nevertheless falls short of demand and imports of 16,000 tons of powdered milk remained necessary in 1975. 12. In addition to family consumption, there are two major outlets for milk production: street vendors and pasteurizing plants. These parallel markets represent approximately 40% and 60% of total marketable output, re- spectively. Street vendors can either be independent or organized in small ANNEX 1 Appendix 1.2 Page 4 groups who will collect milk at farms located close to the urban centers. In addition, eight pasteurizing plants located throughout the country 1/ purchase their milk from market cooperatives or from independent farmers under contract. Numerous collection centers have been set up by the Govern- ment where the farmer can bring his milk to be sold and tested for fat con- tent. This alone has greatly increased the marketable supply of milk. Processing plants produce pasteurized milk, buttermilk, yogurt, butter and cheese. 13. Prices on the "street" market are free. On the "processed" market, however, the Government sets the price to be paid the farmer on a monthly basis. In order to promote local production and to minimize seasonal fluc- tuations in output, this price is inflated by a subsidy paid to the process- ing plants. This subsidy fluctuates between 16% and 36% of the farmgate price, depending on the month. Producer prices since 1975 have varied from a low DH 0.80/liter during the high production months of May and June to DH 1.05/ liter in December. The non-subsidized price remains constant at DH 0.67/ liter throughout the year. The production of butter is subsidized as well. Plants received between DH 2.03/kg and DH 2.28/kg in 1975, which al- lowed them to lower their sales price from DH 9.50/kg to approximately DH 7.40/kg. Milk processing plants are presently operating at approximately 55% capacity and can easily absorb projected increases in milk output. Meat 14. Meat remains under strong demand and prices have been rising over the past few years. Few statistics are available regarding the amount of meat marketed or its price. Cattle and sheep can be sold either at the local market, to local municipal slaughterhouses or to the Government-inspected slaughterhouses located in Casablanca and Rabat. In 1974, wholesale meat prices in Casablanca averaged DH 4/kg for beef, DH 5.50/kg for mutton (live weight). In 1976, data collected from interviews allowed to estimate live weight prices of beef and mutton at approximately DH 5.50/kg and DH 7/kg, respectively. Export Market 15. Moroccan agricultural exports amounted to DH 2,168 million in 1974 versus DH 2,923 million imports. Agricultural exports were mostly made up of citrus (32%), fresh tomatoes (15%), olive oil (12%) and other vegetables (16%). The coverage ratio of exports to imports has been steadily declining from 1.8 in 1969 to 1.5 in 1972 and 0.55 in 1974 due to the world price increases for most imported food products (bread wheat, sugar, milk, seed oils, etc.) which were not met by similar increases in the prices of Moroccan exports. 1/ Casablanca (2), Meknes, Marrakech, Kenitra, Tetouan, Agadir and Oujda. ANNEX t Appendix ±.2 Page 5 16. As much as 40% of all agricultural exports in 1974 were purchased by France. Italy, which is Morocco's second largest customer for agricultural produce, followed with only 11% of exports. Altogether, 68% of Moroccan agri- cultural exports went to the EEC. In order to de-emphasize it:s dependency on the French market, Morocco has persistently been seeking preferential treat- ment with the EEC as a whole. Its first agreement with the Common Market was signed in 1969 and a second agreement was concluded in January 1976. Morocco still enjoys a privileged treatment with France for products such as tomatoes, potatoes and citrus juices. The uniform EEC scheme will nevertheless replace this privileged treatment by 1979. According to this scheme, which will shortly go into effect with other EEC countries, Morocco has been granted tariff concessions on potatoes, tomatoes, fresh beans and peas, grapefruit and grapes among other commodities. Import duties on oranges vary between 0.8% and 4% depending on the season (see Table 3). Most dried pulses can be imported into the EEC duty-free and duties on winter vegetables range from 4.4% on tomatoes to 9.1% on artichokes. Minimum import prices (EEC reference prices) apply to most important products such as oranges, tomatoes, wine and citrus juices. 17. OCE is responsible for exporting most agricultural products, such as citrus and vegetables. It purchases citrus at a fixed price directly from the farmer. It then has it tested for quality and size and either returns, rejects to the grower or sells them for him at the local market. Export quality fruit is crated at the packing station and shipped. OCE is responsible for all ex- port procedures as well as for selling the fruit on the foreign market. 18. For vegetables, OCE acts as the farmer's export agent. The grower brings his produce to the nearest packing station where it is tested and packed. These stations can be either cooperatively owned by the growers or privately owned by third parties. Each station has a permanent OCE employee who is responsible for quality control. The vegetables are sold abroad under the brand name of the packing station. OCE sets up an account for the grower which is debited with the packing charges paid by OCE to the station on his behalf (at nationwide rates set by OCE). The farmer is responsbile for bring- ing his packed produce to the OCE office at the nearest port where shipping arrangements are made for him. His account is further debited with the ship- ping charges and remains overdrawn until the shipload is sold on the foreign market. This form of credit is extended to OCE to promote exports. The farmer receives payment at the going price received for the complete ship- load on average one month after having delivered his products to OCE. Unlike citrus, where OCE purchases the fruit directly, transfer of property for vegetables takes place at the foreign port between the buyer and the farmer, with OCE acting as his agent. 19. Although some farmers, particularly large citrus growers, would prefer to let private enterprise take over to allow for a more aggressive ex- ploration of export markets, it seems that OCE has performed relatively well. It has been able to establish valuable contacts with buyers through its for- eign offices and has ensured a consistent quality for Moroccan exports while at the same time simplifying administrative procedures for the producers. ANNEX 1 Appendix 1.2 Table 1 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Agricultural Marketing Farmgate Prices for Major Crops (DH/100 kg) Crop 1969 1971 1972 19731/ 1975 197J/ Barley 27 30 31 51 59 56 Durum wheat 44 47 46 65 84 93 Bread wheat 39 42 40 52 60 60 Maize 30 30 31 45 70 54 Sorghum 28 24 32 44 58 n.a. Oats 26 26 27 40 62 71 Canary grass 42 41 52 83 135 130 Broad beans 35 40 38 70 67 64 Chick peas 44 103 95 98 102 95 Dry peas 30 37 33 77 76 46 Lentils 54 65 68 127 133 96 Flat Peas 34 28 30 62 51 n.a. Olives (green) - 44 56 87 109 n.a. 1/ Data for 1974 not supplied in this series 2/ Tentative figures for first 2 quarters Source: Ministry of Agriculture and Agrarian Reform and CNCA. August 1976 ANNEX 1 Appendix 1.2 Table 2 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Agricultural Marketing Prices Fixed or Guaranteed by the Government (DH/Q) 1965 1971 1972 1973 1974 1975 Sugar beet 6 6 6.6 7.6 9.6 9.6 Sugar cane - - - - - 6.5 Sunflower 64 64 73.50 73.50 90 130 Soya & colza - - - - - 120 Cotton seed - - - - - 65 Safflower - - - - - 100 Linseed - - - - - 130 Durum wheat-/ 40 47 49 49 63 63 Bread wheat-/ 40 43 45 45 60 60 Barley / 2/ 25-27 27-29 28-30 28-30 40 40 Maizel/ free free free free 45 45 Rice - round grain - - - - 110 90 long grain - - - - 130 110 1/ Support price guaranted by SCAM 2/ Bracket depending on region Source: Ministry of Agriculture and Agrarian Reform ANNEX 1 Appendix 1.2 Tabi e 3 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Agricultural Marketin2 Major Customs Tariff Reductions & Rates Between Morocco & EEC Fruits Reduction Season Auto Rate Conversion Effective Rate (%) (EEC) (GATT)% for EEC (%) Oranges- 80 4/1 - 4/30 15 13 2.6 5/1 - 5/15 15 6 1.2 5/16-10/15 15 4 0.8 10/16- 3/31 20 - 4.0 Mandarines i/ 80 All year 20 - 4.0 Lemons - 80 All year 8 - 1.6 Grapefruit 1/ 80 All year 12 4 0.8 Grapes (table) 60 11/15- 4/30 18 - 7.2 Melons 50 11/1 -12/31 14 - 7.0 Watermelons 50 4/1 - 6/15 10 - 5.0 Vegetables New potatoes i/ 40 1/1 - 3/31 15 - 9.0 Tomatoes - 60 11/15- 4/30 il - 4.4 Onions 60 12/15- 5/15 12 12 4.8 Artichokes 30 10/1 -12/31 13 - 9.1 Sweet peppers 40 All year il 9 5.4 Lettuce 50 4/1 -11/30 15 - 7.5 Eggplant 60 12/1 - 4/30 16 - 6.4 Pulses Fresh peas 60 10/1 - 4/30 12 10 4.0 Fresh beans 60 11/1 - 4/30 13 - 5.2 Dried peas & beans 100 All year 10 4.5 - Lentils 100 All year 7 2 - Broad beans 100 All year 7 5 - Meat (excluding horse & mutton) 100 All year 7 5 - Processed Foods Winel/ 80 Bulk 9 UA/hl 9 UA/hl 1.8 UA/hl 100 Bottled 12 UA/hl - - (50,000 hl qucta) Orange & grapefruit juice1/ 70 21 - 6.3 Lemon & other 1/ citrus prices -l/ 60 21 - 8.4 Prepared citrus- 80 23 20 4.0 1/ Minimum import prices apply to these products ANNEX 1 Appendix 1.2 Table 4 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Agricultural Marketing Economic Prices DH/T Grain (average) 590 Pulses (average) 1,000 Seed cotton 760 Sunflower 1,300 Sugar beet 140 Sugar cane 95 Citrus 275 Olives 1,000 Grapes 860 Vegetables (average) 600 Cow's milk 1,140 Sheep's milk 1,670 Beef 4,700 Mutton 6,000 ANNEX 2 Page 1 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Caisse Nationale de Credit Agricole (CNCA) A. Background & Organization Background 1. Between 1956, the year in which Morocco gained independence, and 1962, the year of the establishment of CNCA, agricultural credit to larger farmers and companies was provided by commercial banks and Government insti- tutions. Credit to farmers with a taxable income of up to DH 1,400 was made available through provident and agricultural credit societies (SOCAP) 1/. Another significant but unknown portion of agricultural credit was extended by moneylenders and merchants. 2. In order to stop the decline in agricultural lending which had oc- curred in 1960 and 1961, the Government established a new credit system with CNCA and its branch offices, the Caisses Regionales de Credit Agricole (CRCAs). In this system, the CRCAs handled the credit needs of the larger farmers and the companies, and the Caisses Locales de Credit Agricole (CLCAs) and the SOCAPs provided credit to the small farmers. Previous agricultural credit institutions were dissolved and their assets were (and are still) managed by CNCA. Although the legal basis for the establishment of the CLCAs was al- ready formed in 1961, the first CLCAs were only set up in 1967. With a grow- ing number of CLCA offices throughout the country, the SOCAPs were dissolved beginning in 1972-73, and the former SOCAP clients were taken over by newly- formed CLCAs. This phase of transition was terminated in 1975. Constitution & Objectives 3. CNCA and its regional branch offices, the CRCAs, were established by Royal Decree No. 1-60-106 of December 4, 1961. This same decree plus Decree No. 2-61-607 declared the foundation of CLCAs as autonomous credit institutions. 4. The objectives of CNCA are to promote agriculture in Morocco by making available credit for agricultural inputs, investments and marketing 1/ Societes de Credit Agricole et de Prevoyance. ANNEX 2 Page 2 to individuals, farmers' groups, cooperatives and companies. In pursuance of these objectives, CNCA annually prepares and implements arn agricultural credit program on a country-wide basis. This program has to be approved by the Administrative Council of CNCA and finally by both the Minister of Agri- culture and the Minister of Finance. In order to achieve these objectives, CNCA was set up as a public institution with its own legal entity, finan- cial autonomy and under the administrative responsibility of the Minister of Agriculture. Consequently, the Minister of Agriculture is ttLe Chairman of the Administrative Council, the policy-making body of CNCA, which combines in itself the authorities and responsibilities that would be executed by both the General Assembly and the Board of Directors in a private enterprise. There are 21 additional members in the Administrative Council: four from the Ministry of Agriculture and Agrarian Reform or institutions related to it, three designated by the Ministry of Finance, two designated by the Minister of the Interior, one representative of the Bank of Morocco and eleven farmer representatives from various provinces of the country. The General Manager of CNCA participates in all meetings of the Administrative Cauncil but has no voting power. The list of all members of the Administrative Council is set out in Table 1. According to the Decree, the Administrative Council has to meet once annually for an ordinary meeting and can be convened for extra- ordinary meetings upon request of its Chairman, or one-third of its members or the General Manager. It is responsible for the general organization and the functioning of all agricultural credit institutions. At the annual meet- ings its main tasks are: - approving the annual program for agricultural credit for the entire country; - approving the lending regulations for the various categories of credit and credit beneficiaries; - accepting the annual financial statements of CNCA as prepared by the Management Committee and submitted to the Minister of Finance for approval; - charging the Management Committee with the appraisal and ap- proval of loans within the framework of the annual credit pro- gram and the lending regulatins; - authorizing the General Manager to borrow funds; - elaborating personnel regulations within the limitations of those in effect for public institutions; - approving the financial statements of CLCA and determining its lending regulations; - delegating specific authorities and powers to the Management Committee. ANNEX 2 Page 3 5. CNCA's Management Committee is composed of eight members with the General Manager as its Chairman. Other members are representatives of the Ministry of Agriculture, the Ministry of Finance, the Ministry of the In- terior and the Central Bank of Morocco. The meetings of the Management Com- mittee are convened by the Chairman or three of its members whenever the necessity arises. It has permanent authority to appraise and approve loans within the norms and regulations set up by the Administrative Council. 6. The Bank of Morocco as the central bank has representatives with voting power in the Administrative Council and in the Management Committee of CNCA. But the Bank of Morocco has no means of direct intervention into CNCA's operations other than through these members of CNCA's policy-making bodies. CNCA also has a large degree of independence in determining its interest rate structure. Its interest rates are determined by its Administrative Council and not by the "Comite du Credit et du Marche Financier", as is the case for the other commercial banks and financial institutions of the country. 7. The General Manager of CNCA is the Chief Executive and its official representative to the Government, to all public and private institutions and to other third parties. He is appointed and dismissed by Royal Decree, upon joint proposal of the Ministers of Agriculture and Finance. He is responsi- ble for the functioning of all CNCA operations and is empowered to appoint the CNCA personnel with the exception of the financial comptroller, who is nominated by the Minister of Finance. The financial comptroller is responsi- ble for controlling CNCA's financial activities and making certain-that they are executed within the framework of the pertinent laws and decisions of the Administrative Council. 8. As previously pointed out, the above-cited decrees are the`legal basis for the formation of the CLCAs. When they were finally established in 1967, however, this was not done on the basis of mutuality as envisaged in the Decree. The reason was that the idea of credit cooperatives was not yet sufficiently developed in the country. The notion of extending credit to members of credit cooperatives was substituted by a mechanism under which credit was extended to farmers categorized in accordance with their fiscal income. 9. Because the principle of mutuality as set out in the Decree has been abandoned, most of the articles in Decree No. 1-60-106 (referring to the CLCAs) and also of the Decree No. 2-61-607 (with its annex setting out sample by-laws of a CLCA) have no bearing on the activities and legal status of the CLCAs as they are today. There are also a number of articles in Decree No. 1-60-106 referring to CNCA and its branch offices, which do not seem to be consistent with the actual lending activities as they are performed at pres- ent. Some striking discrepancies are listed below: ANNEX 2 Page 4 Article 7 indicates that CNCA's Administrative Council is to have 11 members, who are at the same time members of CLCAs set up as credit cooperatives or members of SOCAPs. This is no longer possible since the CLCAs were never established as credit cooperatives and the SOCAPs have been dissolved; Article 14 indicates that one of the CRCAs' objectives is that of extending credit to CLCAs or to agricultural. com- panies and groups. This principle is no longer followed be- cause the CLCAs have their own funds for lending operations, and credits to companies, farmers' groups and cooperatives are extended by CNCA Headquarters and the CRCAS; Article 32 states that penalty interest because of late payments, normal interest and surcharges are not to exceed 10% per annum. This is no longer in line with reality. 10. Although the deviations between the stipulations of the two decrees and the actual lending policy of CNCA are silently accepted and legal diffi- culties have not yet arisen, they should be amended in order to bring them into compliance with the credit policies followed by the Government and CNCA. Organization 11. The Headquarters of CNCA are at Rabat with a General Manager and his Deputy as chief executives. There are four departments headed by a de- partment director and five divisions headed by a division head--all directly subordinated to the General Manager and his Deputy (the organigram of CNCA is in Table 2). The decision to have some divisions report directly to the General Manager and his Deputy without subordinating them to a department head has been made to retain flexibility for future changes in organization. 12. The Credit Department at Headquarters is concerned with loans to individuals only if they exceed certain limits, as set out in the loan regula- tions, and with the appraisal and preparation for approval by the loan commit- tee of all collective loans. After approval, the collective loans are par- tially disbursed and supervised by the CRCAs. A further important task of the Credit Department is the permanent supervision of the loan regulations and the preparation of amendments to the loan regulations for approval by the Administrative Council of CNCA. 13. In the foreseeable future, it may be advisable to include the Divi- sion for Juridical Affairs and Legal Proceedings in the Credit Department and to merge the Division for Administrative Services with the Purchasing Division ANNEX 2 Page 5 in a new department which could be named Personnel, Administration & Purchas- ing Department. The Computer Services could either retain its present status or be attached to the Personnel, Administration and Purchasing Department and the CLCA Division should be redesigned into a staff division for liaison with branch offices through zone directors. 14. All accounting work for the loan accounts is done in the Computer Services Division on a Honeywell-Bull computer, which replaced an older model in 1972-73. After initial difficulties which resulted in big delays in data processing and accounting work, the computer is now operating satisfactorily and has sufficient capacity to digest CNCA's projected increase in lending activities for the next few years. It may however be desirable to modify the computer programming to some extent--with a view to obtain more detailed in- formation on loan recoveries (see para. 95). The Division for Juridical Affairs and Legal Proceedings is responsible for the supervision of loan recovery and of all legal proceedings. No attorneys are as yet included in the division staff, although CNCA management has recently decided to add some legal personnel to the division. All CLCA branches until the end of fiscal year 1974/75 were under the sole supervision of the CLCA Division. Since the beginning of 1975/76 however, a system of regionalization has been created which places the CLCA branches under the supervision of a zone director for the CLCAs, who in turn has to report to a regional director. That leaves the CLCA Division in Headquarters with the task of coordinating CLCA activities with the credit policies pursued by Headquarters. 15. Up to fiscal year 1974-75, the organization of CNCA's lending opera- tions was such that the CRCA and CLCA branches had only very limited authority in loan approval, which made the whole system rather inflexible with respect to servicing the specific needs of CNCA's borrowers. It was therefore decided by the CNCA management: - to implement a new policy of regionalization of credit in order to better adapt credit availability to local needs and conditions; - to delegate more authority in loan approval and in resolution of problems to the local level; - to streamline administrative procedures in order to ensure more rapid and efficient distribution of credit; - to adjust the financing limits under the various credit categories in order to bring them in better relation to the present and future project costs; and - to review client classification criteria on the basis of production efficiency, innovativeness and credit standing. ANNEX 2 Page 6 16. On the organizational level, five regional zones were created follow- ing cultivation, climatic and geographical characteristics. Each of these zones comprises three to eight CRCA branch offices and between three and six CLCA zones'(a total of 23 CLCA zones) which in turn combine three to six CLCAs (a total of 86 CLCA branch offices). Each of the five zones has a re- gional director who is responsible for the CRCAs and CLCAs operating in his area. He is the superior in direct line of the CRCA directors and the CLCA zone directors in his region. Whenever he visits a CRCA branch office, he is an ex-officio member of all Internal Credit Committees newly-established in the CRCAs. Through his participation in committee meetings, the regional director upgrades the committee's authority in loan approval (see also para. 57). The regional directors have been appointed at the beginning of fi- nancial year 1975/76 but at this point in time it is too early to arrive at a judgment whether the objectives of the change in organizational set-up will be achieved. 17. CRCA offices are organized in three sections under a director who has a deputy director if justified by the business activities of the CRCA. With secretarial services and non-professional personnel, a CRCA office normally holds 25 to 30 staff and is equipped with two vehicles, one of them jeep-type which are used mainly for on-farm appraisal and on-farm supervision (organigram, see Table 3). 18. The CLCA offices are manned with one director and usually four to eight agents. There is no clear distinction between the three services as in the CRCAs because loans to CLCA clients are made under criteria of fiscal revenue only, with desk appraisal and loan supervision at random. CLCA agents have to be familiar with all activities normally carried out by the CLCAs, which requires a polyvalent training tailored to the specific needs. About half of all CLCA offices have cashier services. It is planned, however, to increase their number in order to get away from the time-consuming postal money remittance by CNCA Headquarters to CLCA clients. Two CLCA branch of- fices are equipped with full-fledged banking services and also their number will be gradually increased. 19. At present, the network of CNCA branch offices comprises 24 CRCAs and 86 CLCAs (see map). Three CRCAs are to be created within the next two years whereas it is planned to open eight CLCA offices in financial year 1976-77, seven in 1977-78 and another seven in 1978-79. B. Personnel and Training Personnel 20. The staff of CNCA developed from 659 on August 31, 1971 to 1,351 on March 30, 1976, which is an increase of 105% in 4-1/2 years. This substantial increase is reflected in the following table: ANNEX 2 Page 7 March 30, End of Fiscal Year 1970/71 1972/73 1973/74 1974/75 1976 Senior and niiddle management 70 122 125 131 141 Professional and administrative staff (First Category) 140 130 178 216 246 Administrative staff (Second Category) 379 688 751 837 841 Non-administrative staff 76 90 115 123 123 Total 665 1,030 1,169 1,307 1,351 A breakdown of personnel by posts is given in Table 4. 21. Technical staff, agronomists with university degrees and graduates of the Moroccan agricultural high schools, are assigned to CNCA by MARA with- out CNCA being heard about the number of graduates assigned or the selection among the graduates available. Since the number of university and agricul- tural high school graduates in any one year is far below the number required by the various governmental institutions, including CNCA and the Agrarian Reform Cooperatives, there is an acute shortage of technical personn`el, es- pecially in CNCA's branch offices. Normally, not more than one third of the technical personnel requested by CNCA is actually assigned by MARA and an improvement of the situation could be reached by a systematical long-term planning of requirements in this field, worked out by MARA and agreed to by all parties concerned. 22. The Department for General Research and Professional Training is responsible for the selection of all other staff to be employed by CNCA, by staging entrance examinations. Usually, the principle followed is that branch personnel are selected in the area of the future duty station in order to by-pass the reluctance of staff to be assigned for work in regions other than their home region. Senior positions in middle and higher manage- ment are normally filled by personnel from within CNCA after examination under the responsibility of the Department for General Research and Professional Training. 23. The remuneration system of CNCA is based on personnel regulations inherited in 1962 from a Government entity which is no longer in existence. Up to a date as recent as 1975 CNCA employees had a slight salary advantage over Government officials but were placed at a serious disadvantage when compared with other semi-autonomous Government organizations like SODEA and SOGETA. The situation was aggravated by the fact that the private banking sector, with which CNCA has to compete in the personnel market for personnel ANNEJ 2 Page 8 other than agricultural personnel appeared to pay on the average 50% more than CNCA. This lead to a heavy fluctuation of CNCA personnel and it frequently happened that staff, after having been trained by and become valuable staff members of CNCA, changed to banks in the private sectors where more lucrative jobs were offered. 24. In financial year 1975/76 the remuneration system was adjusted upwards, making it competitive with that of the banking sector. Thus CNCA's position in the personnel market has been considerably strengthened with a view to the high personnel needs in the years ahead (the CLCAs alone have a projected need of 382 additional staff in the next six years). Training 25. In 1970, CNCA started to develop its own training programs and had two employees take permanent care of its training needs. Following the recog- nition by CNCA Management of the importance of increased efforts to train the fast growing staff on all levels, a separate Department for General Research and Professional Training was established, which, at the end of the financial year 1974/75, had reached a strength of 19 professional staff. This Depart- ment undertook an assessment of the training needs categorized as follows: - training needed to cover deficiencies in professional know- ledge in day-to-day activities performed by the selected staff; - training needed to cover deficiencies in professional know- ledge with respect to the tasks of other CNCA personiel work- ing in related activities; - acquisition of new professional abilities and skills. 26. Simultaneously, a number of Headquarter department directors and CRCA branch directors were asked which specific professional skills of their department or branch staff they would like to see developed. On the basis of the findings of this assessment a training strategy was evolved which com- prised training programs directed toward specific subjects and training pro- grams of a more general nature for all professional categories and for some non-professional categories of CNCA staff. 27. Following this well-conceived strategy approved by the CNCA manage- ment training courses were begun in 1972 with the aim of updating the staff's professional knowledge. This was done in the form of correspondence courses, seminars, on-the-job training and exterior-training courses. Among the topics covered were banking and agricultural credit, laws relevant to CNCA opera- tions, general agriculture, accounting, marketing, etc. 28. The correspondence courses were given to all branch personnel in- cluding directors and their assistants. They were supplemented by two to four day seminars. At the end of two years, the courses were followed by an ANNEX 2 Page 9 examination which formed the basis for promotion. Although the training by correspondence courses proved to be very successful, it undoubtedly has the disadvantage of extending over too long a period. Intensive training efforts of the seminar type would very likely have a positive effect on the training efficiency. 29. For newly-employed staff of CNCA various forms of training were de- signed. University graduates employed as management interns receive a train- ing of six months duration consisting of two days weekly classroom training and three days weekly on-the-job training in all departments of Headquarters and various branch offices. All newly-recruited branch agents and agricultural staff participated in a basic training of four days duration to acquaint them with the tasks to be fulfilled. 30. Training abroad was offered to two or three staff annually in middle management positions at the "Centre d'Etudes Financieres, Economiques et Bancaires" in Paris, for a duration of 11 months. Up to now, five CNCA em- ployees have participated in EDI courses which are in high esteem. A third training possibility is offered by "Cassa di Risparmio delle Province Lombarde" in Italy. The effect of this training however must appear to be dubious because the total training period is nine months, of which only three months are spent learning the Italian language. 31. In several two-week periods, the CNCA instructors had the oppor- tunity to participate in day-to-day banking activities in order to familiar- ize themselves with the practical aspects of the topics they would teach or in order to get acquainted with new subjects like the practical use of CNCA's computer, pedagogical problems and new developments, etc. The cost of train- ing has risen from DH 153,000 in seven months of 1972/73 to DH 347,000 in 1973/74. 32. In general, it must be recognized that the training program started in 1972 was extremely successful, given the available financial means and personnel resources. Now it should be taken into account, however, that in view of the very rapidly growing personnel needs of CNCA, the training efforts need to be intensified. This could be done by strengthening the present sys- tem through the allocation of a higher budget to allow for the recruitment of more instructors and the acquisition of more training material. While in the immediate future such strengthening of existing training facilities seems to be the only possible way, for the long run the alternative solution of estab- lishing a separate training institute should deserve urgent consideration. A training institute would have a number of advantages over the present system of training some of which are listed below: - training could be done in an intensive way as classroom type training, which would shorten the periods now involved in correspondence courses, yet the training would go much more in-depth than the correspondence courses followed by 2 to 4 day seminars; ANNEX 2 Page 10 a number of subjects which together would give a CNCA staff member the necessary professional skills to perform his duties could be taught at the same time; the institute could better accommodate various levels of train- ing depending on the varying educational background of its students at entrance; - the training would be given to all new professional staff of CNCA before they would be assigned to their new posts which would waive the requirement of releasing staff from their duties for training purposes which always is problematic due to the heavy workload of CNCA personnel. It is therefore recommended to assess the needs and possibilities in the training sector through the preparation of a study that would examine in detail the feasibility and usefulness of setting up a separate training in- stitute for agricultural credit. The study would be undertaken by the CNCA staff with the assistance of experts in professional training and agricul- tural credit and banking. The foreign exchange component for the study would be financed under the Arab Fund Loan. Tentative terms of reference for the first phase of the training component are set out in Table 5. C. Financial Resources Equity Capital 33. The consolidated audited balance sheets for the period August 31, 1971 to August 31, 1975 and an unofficial balance sheet for the first eight months of the financial year 1975-76 and the audited consolidated income statements broken down in income statements for CNCA/CRCA and CLCA for the same period are set out in Tables 6 and 7. Since CNCA is a State-owned company, no dividends are paid and profits are retained to strengthen the equity base and to generate more funds for lending operations. The equity capital of CNCA over the last four years has developed from DH 50 million to DH 135.9 million, an increase of 171%. The increase is due to a transfer of DH 44 million from the general fund, i.e., the equity of CLCA, to the CNCA capital and to a transfer of DH 37.8 million and DH 4.1 million, res- pectively, from IDA Credit No. 338 in 1973/74 and 1974/75. At the same time the CLCA general fund increased by approximately 68% from DH 55.7 million to DH 93.3 million. After a modest increase by DH 5 million in 1971/72, DH 19.7 million of managed funds from organizations under liquidation were included in the CLCA capital in 1972-73, but at the same time DH 44 million were trans- ferred from the general fund of CLCA to the capital of CNCA, leading to a de- crease of CLCA general fund to DH 36.4 million. At the beginning of 1975/76 it was decided by the Government that an amount of DH 56.9 million, which the Governnent had received as a loan from the Iranian Government and passed ANNEX 2 Page 11 on to CNCA, would be converted into a grant to CNCA. This transaction is already shown in the balance sheet for 1974-75. A further portion of this grant in the amount of DH 62.4 million has already been received by CLCA in- creasing the equity capital without guarantee fund to DR 163.3 million. A last amount of DH 3.9 million is expected in FY76-77. The guarantee fund of CLCA that was established to cover the lending risks has increased from DH 2 million to DH 7.6 million. Up to the present time, from each loan which CLCA disburses, 2% is retained and added to the guarantee fund, thus leaving it without any relation to the actual amounts of bad debts or amounts overdue and accumulating more funds than would be necessary under this cate- gory. Net Income and General Reserve 34. The net income of CNCA achieved in any one year is transferred the following year to the general reserve, which grew from DH 12.8 million in 1970-71 by 107% to DH 26.6 million in 1975-76. The ratio of general reserve to the combined equity capital of CNCA and CLCA however developed from 11.9% in 1970-71 to a peak of 17.7% in 1972-73 and decreased due to the increase in capital to 10.7% in 1974-75. Loan Agreement No. 861-MOR in Section 5.10 has a covenant that CNCA shall take all necessary steps to increase and thereafter to maintain its general reserves at an amount not less than 15% of its capital. Since this covenant does not appear to be very efficient, it will be replaced by a debt/equity ratio covenant, which would limit the long-term borrowings of CNCA to four times the capital funds including accumulated reserves, guarantee fund and profits. At the same time another covenant would be introduced which would safeguard that current assets at all times would be 20% higher than current liabilities including cash advances from BDM and CDG and short-term deposits. Deposits 35. Deposits have developed from DH 25.8 million to DH 137.4 million. While the absolute increase in amount as such is significant, it must be in- dicated that there are few very large depositors, mainly State-owned com- panies. If these depositors would withdraw their deposits, this would result in a sharp reduction of deposits. Interest rates on deposits are 1.5% on sight deposits, a privilege held only by CNCA in Morocco, and between 2% and 6.5% for term deposits deposited for periods ranging from 1-24 months. CNCA has calculated an average interest payable on deposits of 1.9%. This rate has also been adopted for the projections in this report. It is generally felt that the mobilization of deposits is one of the most important tasks of CNCA in the future. In recognition of this necessity, the CNCA manage- ment has launched publicity campaigns to encourage deposits and to make farmers increasingly familiar with the credit facilities offered by CNCA, which may make them also more inclined to make use of the deposit system. ANNEX 2 Page 12 Special savings schemes have been devised for small deposits and experi- ments with a mobile cashier service, operating at a number of markets throughout the week, has led to encouraging results. There are however serious constraints hampering the deposit mobilization: - CNCA has no staff exclusively working for the implementation and promotion of savings schemes; - the premises and buildings of CNCA's branch offices, the CRCAs and CLCAs, frequently do not have the appearance that would attract depositors; - competition from commercial banks is strong. (The advantage of CNCA paying interest on sight deposits is compensated in other ways by the commercial banks). the mentality of farmers in Morocco is not directed towards putting their savings in bank accounts; they would rather buy livestock which normally gives them a better return than any bank in Morocco can offer. The Arab Fund would undertake to finance technical assistance for the devel- opment and improvement of CNCA's banking services with special emphasis on mobilization of deposits. Bank Advances 36. CNCA has recourse to cash advances from the Bank of Morocco at an interest rate of 3% and from the Caisse de Depots et de Gestion (CDG) at 6%. These cash advances are called discount facilities because in the past years for each loan maturity of loans extended by CNCA, bills of exchange were prepared although these were never handed over to the Central Bank and the CDG but were held ready for inspection in CNCA Headquarters. The procedure of issuing bills of exchange has been stopped and CNCA can obtain cash ad- vances if and when needed up to a ceiling of DH 150 million from the Central Bank of Morocco and DH 30 million from CDG. For amounts exceeding these ceilings, higher interest rates have to be paid. Cash advances shown in the balance sheets do not reflect the average amounts taken up during the years because the liquidity position at the end of the financial year is usually good due to the inflow of loan recoveries after the harvests. Borrowings 37. Two Bank loans were made available to CNCA, Loan No. 433-MOR in the amount of US$10 million was disbursed between November 1965 and September 1969 and Loan No. 861-MOR, in the amount of US$24 million, was disbursed bet- ween July 1973 and June 1976. Repayment of Loan 433-MOR started in March 1970 and at August 31, 1975 the unpaid portion of the Loan amounted to DH 29.7 million to be repaid until March 1982. Repayments under 'Loan 861-MOR ANNEX 2 Page 13 have started in August 1976 and will continue until February 1987. At August 31, 1975, the Loan was shown in the balance sheet with an amount of DH 54.7 million. Additionally, DH- 45.9 million have been disbursed until June 1976. Both IBRD loans are guaranteed by the Moroccan Government, which also bears the foreign exchange risk. The loans were made to CNCA to finance medium- and long-term lending operations. Bank Loan No. 433-MOR bears interest of 5.5% per annum and Loan No. 861-MOR bears interest of 7.25% per annum. 38. Other long-term borrowings of CNCA were a bond issue of January 1973 at an interest rate of 6.25% per annum and another bond issue of May 20, 1974 at the same interest rate of DR 30 million each. The total unpaid balance of both bond issues at August 31, 1975 was DH 54 million. The re- payment has to be made with DH 4 million annually. A loan from the City of Agadir had an unpaid balance of only DH 13,000 at August 31, 1975. 39. The CLCAs have received a long-term loan from Kreditanstalt fur Wiederaufbau in Germany in the amount of DM 10 million in January 1973, at an annual interest rate of 2%. Repayment will start in June 1983 and the last payment will be made in June 2003. On August 31, 1975 the Loan was shown in the balance sheet in the amount of DH 16.4 million. Managed funds in the amount of DH 39.9 million are available to CNCA at no cost for spe- cific credit operations determined by the Government. The funds originate from former banks and credit companies under liquidation, which are the Caisse Centrale de Credit et de Prevoyance, the Caisse Federale, the Caisse Regionale d'Epargne et de Credit and the Societes de Credit Agricole et de Prevoyance. Table 8 shows the funds available to CNCA and CLCA and their cost in percent as well as the weighted average cost in percent. The same table also shows the projected cost of funds. D. Lending Policies and Procedures I. CLCAs Lending Policies 40. The CLCAs make loans to small farmers with a minimum fiscal income of DH 100 and a maximum fiscal income of DH 3,000, which corresponds to an estimated actual farm income of DH 250 and DH 7,500 or US$58 and US$1,744 respectively. (For details regarding the fiscal income principle, see Annex 1, paras 22-24). In 1967, when the first Caisse Locale was established, the upper limit was DH 4,000 and the lower limit DH 1,400; clients below this limit were served by the SOCAPs. In 1970, new limits were fixed with a mini- mum of DR 800 and a maximum of DH 3,000. In the FY 72-73, an integration of the SOCAP customers was done by regions and has been terminated in the FY 75- 76, when the last SOCAPs were dissolved. Each farmer gets a tax certificate each year by which his taxable income is determined. Coming from a public ANNEX 2 Page 14 enterprise, the CLCA agents have access to the tax offices and prepare lists with all potential CLCA clients, i.e., farmers with a fiscal income of DH 100 - DH 3,000 which are updated every year. These lists are kept with the CLCA offices and are consulted in each case loan applications are processed. The integration of the SOCAPs in the financial year 1972-73 added 46,774 po- tential clients, in 1973-74 161,938 clients, in 1974-75 394,706 clients and in 1975-76 an estimated number of 360,000 clients. The total number of poten- tial CLCA clients in the year 1975/76 is 1,023,134, of which an estimated num- ber of 170,000 or 16.6% are customers of the CLCAs by having a loan outstand- ing at any one time of the fiscal year. Plans are being discussed to combine CRCA and CLCA offices in the southern area of Morocco and to extend loans to customers in that area in accordance with uniform lending norms. 41. Since for 1976 the poverty level of an agricultural family is esti- mated to be DH 4,500 or US$1,050, about half of all credits made available to CLCA customers are extended to farmers below the poverty level as the follow- ing table demonstrates: Number of Credit Files at March 31, 1976 Percentage Short-term Medium-term Total of Total Up to DH 1,400 fiscal income corresponding to approximately DH 3,500 actual farm income or DH 4,500 actual total income 17,749 81,777 99,526 54% Over DH 1,400 fiscal income 12,179 72,056 84,235 46% Total 29,928 153,833 183,761 100% The details are in Table 9 to this annex. From this table it also can be derived that the number of loans extended to farmers in the fiscal income range up to DH 300 is insignificant. The very poorest farmers, i.e., those with a fiscal income of below DH 100 are not reached at all by institutional- ized credit. 42. As already pointed out the eligibility of farmers for CLCA credit depends upon their fiscal income which must not be lower than DH 100 and not higher than DH 3,000. The number and amount of loans that can be allocated to one farmer is also in relation to his fiscal income. It is limited to one short-term loan of DH 150 for farmers with a fiscal income of DH 100 to DH 150. Farmers with a fiscal income of DH 151 to DH 300 can get one short- term loan in the amount of maximum 100% of their fiscal income. Farmers who ANNEX 2 Page 15 have a fiscal income of DH 301 to DH 3,000 can either get two short term loans, or one short-term loan and two medium-term loans--all outstanding simultaneously at any one time. The amount for each individual loan is determined in loan regulations, revised for the fiscal year 1976/77, for short-term loans normally as a fixed amount per hectare and for medium-term loans as a percentage of the investment cost. However, the actual limitation on the loan amounts is that the maximum amount for each short-term loan must not exceed 50% of the farmer's fiscal income. For medium-term loans the limitation is connected to the repayment capacity to the effect that the annuity in principal for each loan must not exceed 50% of his fiscal income, so that a farmer with two medium-term and one short-term loan outstanding would have a repayment obligation in loan principal of 150% of his fiscal income plus interest. (The lending norms in condensed form are set out in Table 11.) 43. This limitation in indebtedness leads to the fact that approximately 70% of investment costs are actually financed by medium-term loans instead of the 80% that would be allowed for financing in accordance with the norms mentioned in the previous paragraph. Interest Rates 44. Interest rates on CLCA loans are not computed pro rata temporis but as a charge of 4% at the date of the loan execution regardless of the term of the loan, and another 4% on each October 1. An exception are short-term harvest loans, where the charge is 2% instead of 4%. In addition a one-time charge of 2% is raised on all loans at the time of disbursement to feed a guarantee fund established to cover credit losses. This guarantee fund has been set up in lieu of provisions for bad debts and at August 31, 1975 had accumulated to DH 7.6 million, more than enough to cover all inherent risks. The system of firm percentage charges had been chosen for the sake of simplicity in calcu- lation and bookkeeping, but it has the effect that the equivalent interest rates calculated pro rata temporis are approximately 9.8% for short-term loans for cereals, 13.6% for short-term production loans for other crops, 13.1% for short-term loans for sheep and cattle-fattening and 15.7% for short- term harvest loans. For medium-term loans the highest rate pro rata temporis of approximately 8.7% would be on loans with two-year duration. The interest rate would then decrease to 7.2% on three-year loans, 6.5% on four-year loans and 6% on five-year loans--resulting in a weighted average of approximately 6.5% pro rata temporis for all medium-term loans, a distortion which cer- tainly will have to be corrected. The fixed charges of 4% (2% for harvest loans) as well as the 2% guarantee fund charge have been in effect for many years and were not increased on September 1, 1975 when interest rates for individual customers of the CRCAs and Headquarters were increased. The CLCAs do not charge penalty interest for late payment but raise fees for legal pro- ceedings which are debited to the account of the client only after the pay- ment has been received. hNNEX 2 Page 16 Appraisal, Approval & Supervision 45. CNCA management has chosen a loan appraisal system for CLCA eus- tomers that is based on a desk review of the applicant's eligibility, which automatically includes his repayment capacity, and of the purpose of the loan. This system is used since 1967 and has been justified with the following reasons: - Because of the limited indebtedness of the borrowers, as fixed by the loan regulations, the lending risk is kept at a minimum; - the pre-set categories of lending further reduce the lend- ing risk; - technical staff for field appraisals is limited and not even sufficient for the CRCAs; - the high number of loans to be processed excludes field appraisal. These reasons are valid and an alteration of this system, though desirable at the earliest possible time, will not be possible during the project period. 46. The loan approval for a CLCA lôan is done by a local credit com- mittee (see Table 15) which is convened once per week by its chairman. Its decisions have to be taken unanimously. 47. As collateral for all-CLCA loans, a personal guarantee is requested which can be given by another farmer usually possessing a farm of similar size, a merchant or a Government official. Disbursement takes place in one lump sum in the CLCA office if cashier's services are available. If that is not the case, the disbursement will be made either in the next CRCA office or by postal money order. Recoveries 48. Loans or loan installments are usually due after the harvest and collection is done by the recovery agents of the CLCAs on the various markets in the area. More than half of the debtors are paying in person in the CLCA offices and a significant percentage of debtors for medium-term loans repay prematurely in order to be eligible for another loan. The recovery rates of the CLCAs have been extremely good as Table 10 shows. On principal and in- terest fallen due during the year 1974-75, 85.5% have been recovered (89.2% the year before) and for principal and interest overdue at the beginning of the same period, the recovery rate was 79% (83.6% the year before). The recovery system as such is most efficient, due to effective management and the support by the Government authorities. In fact claims of CNCA are di- rectly executable just as Government taxes (see para 60). ANNEX 2 Page 17 Il. CRCA & Headquarters Lending Policies 49. The regional offices of CNCA (the CRCAs) lend to individual farmers with a fiscal income of more than DH 3,000 and to farmers' associations for mechanization whereas Headquarters are responsible for lending to cooperatives and companies and for individual loans if they exceed certain limits laid down in the loan regulations. Among the collective loans extended by Headquarters are loans to the ORMVAs for comprehensive industrial crops programs (short-term) and for the establishment of plantations (long-term), loans to Agrarian Reform Cooperatives for production inputs and investments, loans to State companies (these loans are implemented and supervised by CRCAs) for production inputs, for investments and to finance marketing of cereals and cotton. 50. Along with the creation of the DRCAs (see paras. 15 and 16), a classification of CRCA clients has been introduced on September 1, 1975 by which all clients who have received loans already since a minimum period of two years, who cultivate their land in accordance with modern techniques, who have used the credit allocated to them in a satisfactory manner and who have fulfilled their repayment obligation would be classified into the Category A. Category B would be new loan applicants or other individuals who do not ful- f ill the requirements as indicated for Category A. The categorizing of clients has started in order to simplify administrative procedures but has not been terminated yet in all CRCAs. Preliminary estimates show that approximately 10% of all CRCA clients would form Category A. 51. The CRCAs' lending norms are laid down in loan regulations which are normally revised when the need arises. These norms vary slightly between the five regions but cover in general 70% of production cost for short-term loans and 70% of investment cost for medium-term loans. (For details see Table 13). The main features covered by the last revision of the norms in September 1975 were a general upward adjustment, the inclusion of financing for locally-bred cattle (which has caused already in the first months of financial year 1975/ 76 a big increase in disbursement of loans for livestock breeding and fattening) and an increase in duration of medium-term loans, a feature which is considered to be very attractive by the farmers. 52. Lending norms for Category A customers are slightly higher than those for Category B customers. Agrarian Reform Cooperatives, however, which under the agrarian reform program are treated with first priority in the agricultural sector, have different lending norms. Whereas individual medium- term loans are disbursed in the amount of 70% of investment costs, Agrarian Reform Cooperatives are eligible to 100% financing for the first set of equip- ment but according to Government regulations ought to get only 50% financing for any replacement, a regulation which is not strictly adhered to. Short- term financing is allocated in the first year after creation to cover 100% of the needs, in the second year 80%, the third year 60%, the fourth year ANNEX 2 Page 18 40%, the fifth year 20% and from the sixth year onwards no short-term credits are granted at all. The execution of this rule can be postponed if the coop- erative is in financial difficulty because of a bad harvest or other reasons. The consequence of this rather irrational system is that the own funds of the Agrarian Reform Cooperatives are increasingly tied up for ehort-term agricul- tural inputs. There is also the jeopardy that the use of fertilizers and plant protection agents is decreased or that the necessary funds are borrowed from local merchants or moneylenders at usury rates. The declining financing rate for farm investments for replacements would have a similar effect, neces- sary replacements being postponed and old equipment being continuously used at uneconomically high repair and operating costs. The whole system of financing Agrarian Reform Cooperatives as it stands now seems to be inefficient and would be revised with effect from September 1, 1977 (see para. 91). Interest Rates 53. Upon CNCA's proposal, interest rates for loans extended by Headquar- ters and CRCA were increased as of September 1, 1975 (see Table 14). The new interest rates approved by the Government in 1975 are partially the result of the prompting by the Bank both at the national level, in discussions with Bank economic missions, in negotiations on specific projects and through the study on interest rates undertaken by the Bank of Morocco under the auspices of the IMF and the Bank, and at the agricultural credit level. A1- though not all the proposals regarding rate increases were approved, the alterations must be considered as a first step in the right direction. The interest rate structure for medium-term'credits has been simplified at the same time and only two rates have emerged>' 7%'for cooperatives and farmers' associations and 8.5% for'all'other borrowers. Short-term production loans for grain and pulses with the exclusion of rice bear an interest rate of 6% as before, but short-term loans for comprehensive industrial crops programs have been increased to 8% and are passed on to the farmers at 8.5%, and production loans for vegetables, citrus, livestock fattening and rice have been increased to 8.5%. Interest rates for marketing of grain and cotton remain unchanged at 4.75% and 5.5% respectively. Appraisal, Approval and Supervision 54. Upon receipt of a loan application, the section head of the loan section of the CRCA decides whether or not a field appraisal would have to be made. In accordance with the revised loan regulations, field appraisals are no longer compulsory for medium-term loans requested by customers of Cate- gory A. For customers of Category B field appraisals are compulsory for certain types of investment. These are establishment of plantations, con- structions, cattle fattening, chicken breeding, and irrigation projects. For other medium-term loan applications, the decision on the necessity of a field appraisal is at the discretion of the section head. For the first time in financial year 1975/76, the CRCAs are also appraising loans for farmers' associations for mechanization which was done before at Headquarters. Loan appraisals for Agrarian Reform Cooperatives are done by the credit ANNEX 2 Page 19 department of Headquarters. During field appraisal and subsequent to the appraisal a number of forms are filled, which if properly executed would give all information necessary to arrive at a proper and well-founded decision on the eligibility of the applicant, the viability of the project for which the credit is destined and the creditworthiness and repayment capacity of the applicant. The calculation of farm income and operating costs should be based on yields obtained and operating charges incurred after the benefits of the loan under appraisal would have fully materialized. But in fact the calcula- tions are often based on operating costs and farm income without the benefits of the credit, a comparison of net income with and without the credit is not made at all, and incremental returns are not calculated. 55. Appraisal of loan applications which because of their size are beyond the approval capacity of the CRCAs or appraisals of loan requests for companies are supposed to be done in the same manner as those for other cus- tomers executed by the CRCAs. For cooperatives however all individual loan requests are incorporated into a regional lending program, which is then forwarded to MARA and very often revised upwards or downwards in the Ministry in accordance with the priorities set for the achievement of certain agricul-< tural targets. The summarized requests are discussed with CNCA Headquarters and an appraisal is done only in the case where financing for non-standard investments is requested. Similarly, loans for public enterprises like SODEA and SOGETA are requested through MARA, guaranteed by the Government and therefore often not properly appraised. 56. It is up to the director of a CRCA or the credit department of Headquarters to determine which collateral should be requested. Under the Moroccan law, quite a number of collaterals are available to choose from, 50 that normally lack of security is not a reason for loan rejection as in some other developing countries. For medium-term loans, the types of colla- teral most widely-used in Morocco are the mortgatge, the guarantee secured by a mortgage, the joint and several guarantee, the undertaking to grant a mortgage and the attachment of tractor registration cards. For short-term loans chattel mortgages, crop liens, and personal guarantees are requested. It is emphasized in the loan regulations however that the best guarantee is a good appraisal and a close supervision of the loan after disbursement. 57. On the CRCA level two bodies are available for loan approval. (See Table 15.) The Internal Credit Committee has been newly-created in financial year 1975-76 in order to simplify procedures and reviews approxi- mately 25% of the loans which up to financial year 1975-76 had to be referred for decision to the normal Credit Committee, which meets less frequently. 58. Loan requests which cannot be decided by the Internal Credit Com- mittee have to be passed to the Credit Committee which can approve short-term loans up to DH 60,000 (in some regions up to DH 100,000), and medium-term loans without limitation on the individual loan. There is a general limita- tion, however, that the total loan portfolio for one client must not exceed DH 150,000 (in some regions DH 200,000). Loan requests exceeding these ANNEX 2 Page 20 limitations have to be forwarded to the Credit Department of Headquarters for reference to the Management Committee of CNCA. Decisions taken in the daily meetings of the Internal Credit Committee of the CRCAs are final up to amounts of DH 30,000. Loan approvals between DH 30,000 and 60,000 are final only if the regional director was present in the meeting and has supported the loan. If he was not present and for loan approvals exceeding DH 60,000 the addi- tional approval of the Credit Department of Headquarters is necessary. 59. Loan disbursements are made to suppliers whenever possible or otherwise in cash at the CRCA offices. On the CRCA and Headquarters level, contrary to CLCA disbursements, loan disbursements normally are considerably lower than loan approvals. In the financial year 1974-75, the disbursements of both Headquarters and CRCA represented only 77% of the loan commmitments. This phenomenon has a number of reasons: - Short-term credit ceilings for cooperatives have been set too high and the credit allocations cannot be utilized; - difficulties in the supply of inputs or machinery on the side of the supplier; - difficulties with loan/security; - change of opinion on the side of the borrower; - difficulties in obtaining-the necessary cash contribution on the side ofUthe borrower, etc. Recoveries 60. Recoveries on the level of the Headquarters and CRCAs are not as good as on the level of the CLCAs but still very satisfactory for a credit institution in a developing country with such large numbers of outstanding loans. As already pointed out in para 48, the Government authorities extend their full support to CNCA in matters of loan collection. This support has the legal basis in Decree No. 11-92 of August 21, 1935 as amended to its present version in 1970, which determines the modalities of legal proceedings in the collection of direct taxes, tax-like fees, income from State-owned land and other financial claims recovered by tax collectors. Included are financial claims by public enterprises, which give CNCA the invaluable advantage that in case of default all its financial claims are directly executable without re- course to time-consuming court proceedings. The decree prescribes in detail the writ of execution, the imprisonment for debts, the distress of property, foreclosure of mortgages and the sale of seized property. Since this decree, together with an effective management, forms the basis for CNCA's better than average recovery rates, no amendments would be incorporated in the decree which would materially affect the capability of CNCA's loan collection, without prior consultation of the Bank. ANNEX 2 Page 21 61. In financial year 1974-75 collections on amounts falling due were 79.5% and on amounts overdue 64.6%. The corresponding figures in the year before were 78.3% and 63%. Provisions for bad debts have accumulated over the years to an amount of DH 9.9 million at the end of financial year 1974- 75, representing approximately 9.2% of the amounts overdue, or 85.2% of the amount of DH 11.7 million which must be considered as bad debts. (See Table 22.) 62. Penalty interest of 2% is charged by Headquarters and CRCAs on all amounts overdue after a period of default of two months. These charges together with charges for legal proceedings are debited to the account of the defaulter only after collection in order to avoid inflating the amounts of bad debts in the balance sheet. Penalty interest received in 1974/75 amounted to DH 1.2 million, a very modest amount which is not so much a result of outstanding penalty interest not being collected but on the contrary the result of the low rate of amounts falling overdue. Notices of amounts falling due are sent out by mail to every borrower one month before a due date. 63. Legal proceedings are started against individual borrowers very soon after loan maturities get into default. These take the shape of mere reminders and in the next step of a "no charge summons" in which the de- faulter is requested to pay within 30 days and in which also the next legal steps are announced: - Writ of execution - Foreclosure of mortgages - Distress and sale of property - Imprisonment for debts While writs of execution are served rather frequently with the assistance of local authorities, it very seldom comes to distress and sale of property, be- cause the latter is done in the form of an auction and already the public announcement of such auction in the village of the defaulter with his name made public too, does serious damage to his reputation and usually is avoided at all costs. The system of legal proceedings is highly developed and hardly could be more sophisticated. Despite the efficient system, difficulties some- times arise when the defaulter is too influential to take legal proceedings against him. Also quite a few loans of former borrowers of SOCAPs which are under liquidation seem to be unrecoverable. 64. When it comes to collective lending, a difference has to be made between private farmers' associations, cooperatives and companies and State- owned companies and organizations. In general, repayment of Agrarian Reform Cooperatives is satisfactory as Table 12 shows. Defaults have occurred on two occasions and a rescheduling was negotiated for the provinces of Safi and Sidi-Bennour. Judiciary action is under way against various private companies which were formerly owned jointly by foreigners and Moroccans. Outstanding loans from ORMVAs for production of sunflower have been taken over by Govern- ment and are almost fully repaid. Arrears of COMAGRI, the State-owned company doing the importing of cattle, were to be settled in summer 1976. ANNEX 2 Page 22 E. Past and Future Lending Operations Past Lending Operations 65. A detailed analysis of loans committed over the past four years is given in Table 16 for individual farmers and in Table 17 for farmers' associations, cooperatives and companies. Total lending to individuals has increased by 75% and lending to associations and companies by 105%. The average increases were as follows: Short-term Medium-term Total Average Increase Individual Loans HQ/CRCA 19.4 16.1 18.2 CLCA 17.7 30.9 28.5 Total 19.2 22.2 20.6 Average Increase Collective Loans HQ/CRCA 20.4 77.1 24.7 Grand Total Average Increase HQ/CRCA - - 22.0 CLCA - 28.5 Total 22.8 66. Although an evaluation of the growth rates does not generally allow meaningful conclusions, some can be drawn: For lending operations of HQ/CRCA: - Collective lending with an average rate of 24.7% has grown faster than lending to individuals with an average rate of 18.2%; - short-term lending to individuals had approximately the same average growth rate as short-term collective lending (19.4% versus 20.4%) although there is an apparent trend to higher growth rates for short-term loans to groups and companies caused by high increases in lending to ORMVAs and SPs and companies. For lending operations of CLCA: - In comparison with HQ/CRCA lending to individuals it can be said that short-term CLCA lending grew slightly slower but medium-term CLCA lending much faster. ANNEX 2 Page 23 short-term lending seems to be erratic in absolute amounts and apparently there is a trend towards decreasing growth rates if not even in absolute amounts, - medium-term lending shows a strong average growth rate of 30.9%, although the growth was interrupted by a decline in lending in 1973/74. 67. In total, lending of CLCA has been growing at a faster average rate of 28.5% than lending of HQ/CRCA that grew at an average rate of 22.0%. The biggest portion of all short-term HQ/CRCA lending to individuals over the past four years were loans for livestock fattening with 48.7% followed by production loans for cereals with 29.7%. The corresponding figures for CLCA are in reverse order, short-term production loans for cereals are in first place with 50.0% followed by loans for livestock fattening with 39.2%. In medium-term of HQ/CRCA lending to individuals, the categories are more equally divided. The biggest loan category is loans for tractors with 26.5% followed by loans for farm buildings with 18.9% and loans for livestock breeding with 12.7%. 68. In medium-term CLCA lending four loan categories deserve to be mentioned, 35.2% of all loans have been extended for investment in farm buildings, 21.6% for cattle breeding, 19.2% for draft animals and 15.5% for wells and minor irrigation schemes. It should be mentioned that loans for livestock breeding were granted for the first time in 1972/73 where they represented only 8.1% of total medium-term lending. In 1974/75, however, they have become the strongest lending category with a share of 38.1%. 69. Short-term collective lending clearly shows the Government prior- ities in the agricultural sector: loans for comprehensive industrial crops programs have the biggest share with 34.4% followed by loans to cooperatives with 29.6%. Among the cooperatives the heaviest though declining financing went to SCAM and CMA for grain marketing with 21.6% of all short-term loans. Agrarian Reform Cooperatives were in second place with 6.6%. If we take a look at the various crops financed with short-term loans, sugar beets got the biggest chunk with 31.5% of all short-term financing. 57.4% of all medium-term financing went to cooperatives, of which the Agrarian Reform Cooperatives got 45.5%. 70. A new type of short-term lending in the form of extending a credit line for cash flow financing of private commercial vegetable production is being considered. Future Lending 71. The projected lending program for the period 1975/76 - 1981/82 (see Annex 5, Tables 2-5) has been worked out as a synthesis of the expe- rience gained from the CNCA lending activities over the past four years ANNEX 2 Page 24 and including the first half of 1975/76, the priorities in the agricul- tural sector set by Government as they are expected to develop and the preferences and expectations explained by CNCA's management as laid down in their preparation report. 72. For CLCA lending the basic assumptions are that the number of short-term loans would grow by 43.9% in 1975/76 and then by 5% annually, a slower growth than that expected for medium-term lending with 33.7% in 1975/76 15.5% in 1976/77 and then 10% annually. The reason for the big increase from 1974/75 to 1975/76 is the integration of the last zone of SOCAP customers. The figures are based on the actual figures attained until March 30, 1976. Due to a change in CLCA's loan regulations introduced as of September 1, 1976, the average loan amount is expected to grow from DH 415 in 1975/76 to DH 600 in 1976/77 for short-term loans and from DH 1,700 to DH 2,450 in the same time for medium-term loans. 73. These assumptions would lead to expected short-term lending of DH 17.8 million 1975/76 and DH 34.6 million in 1981/82. The average annual growth rate between 1975/76 and 1981/82 would be 11.6% and the loan amount in the last year under consideration of DH 34.6 million woulcl nearly triple as compared with DR 13.1 million in 1974/75. Medium-term lending, however, would grow at a much higher average rate of 17.9% leading to a loan amount of DH 273.1 million or 268.1% of the amount obtained in 1975/76. 74. Short-term loans for cereal production would remain the largest individual lending categeory taking up 70% of all short-term lending followed by livestock fattening with 24%. In medium-term lending live- stock breeding in continuation of the trend observed would become the biggest individual lending category. Also financing of farm buildings and draft animals would continue to be strong lending categories. 75. The projections for the HQ/CRCA lending program (see Annex 5, Tables 2-4) have been made on the basis of projected physical quantities of land to be cultivated for short-term financing or of investments to be financed by medium term loans expressed in units of machinery to be pur- chased (tractors, combines, etc.), ha of land on which plantations are to be established or heads of cattle to be purchased. These projections are set out in Annex 5, Table 1. Under incorporation of various rates of price increase and using unit prices which are also indicated in Annex 5, Table 1, the lending program at current prices was calculated. Short-term lending is expected to be DH 1 billion in 1981/82 compared with DH 438.9 million in 1974/75, an increase of 128%, somewhat lower than the increase in short-term CLCA lending. 76. Medium-term lending is projected to reach DH 435.2 million, 309.7% of lending in 1974/75. In the short-term lending of the year 1981/82 of DH 1.001 million, loans for livestock fattening would be included with DH 251.4 million (25.1% of total short-term lending), cereal production with DH 192.8 ANNEX 2 Page 25 million (19.3%) sugar beet production with DH 177.3 million (17.7%) and marketing loans for grain with DH 563 million (5.6%). A big portion of DH 70.1 million in medium-term loans in 1981/82 is expected to go to tractor financing, but loans for combine harvesters, imported cattle and farm buildings would be of similar importance. 77. Following the experience of the last few years, disbursements for short-term production loans for comprehensive industrial crops programs are expected to be 75% of commitments, disbursements for all other production loans 85%, for marketing loans 70%, for medium-term loans to Agrarian Reform cooperatives 70%, for medium-term loans to individuals and companies 80% and for medium-term loans to comprehensive industrial crops programs and pre- cooperative groups 90% of commitments. F. Financial Analysis, Projections and Recommendations 78. Comparative financial ratios of CNCA/CRCA, CLCA and global CNCA operations as actual ratios for the period 1970/71 - 1974/75 and as projected ratios for the period 1975/76 - 1981/2 are set out in Table 18. These pro- jected ratios have been calculated from the figures in the Projected Cash Flow 1975/76 - 1981/82 (Table 19), the Projected Consolidated Income Statement (Table 20) and the Projected Consolidated Balance sheet (Table 21)--all for the same period. Equity investments are set out in Table 23. Relation between Interest Rates, Operating Cost and Operating Income 79. CLCA experienced an operating loss in all years since 1970-71, which grew permanently from DH 1.1 million to DH 5.8 million in 1974-75. This in- crease in losses in the first two years under consideration was below the proportion of increase in CLCA's loan portfolio but jumped in 1973-74 and 1974-75 to rates (223% and 159%, respectively, of the loss incurred the year before) that exceeded by far the increase in portfolio (128% and 114%, re- spectively, of the portfolio of the year before). 80. The reasons for the losses are the high cost involved in lending to small farmers, resulting in excessive operating cost and the low interest rates (see para 44) which generate too low an income to cover the operating cost. The high cost of CLCA's lending operation is reflected in the com- parison of the operating cost of the last four years with the loans disbursed for both HQ/CRCA and CLCA operations as set out below: ANNEX 2 Page 26 Percentage Operating Cost/ Operating Cost Loans Disbursed Disbursement Average CLCA 32,859 278,656 11.8 HQ/CRCA 106,509 1,482,076 7.2 Grand Total 139,368 1,760,732 7.9 81. Over the last four years for each DH 1,000 in loans disbursed, CLCA had to incur operating expenses of DH 118, whereas the expenses for HQ/CRCA were only DH 72 for DH 1,000 of loans disbursed, 61% of CLCA's figures. And that despite the fact that CLCA is using a simplified method of desk loan appraisal without any field appraisal and only sporadic field supervision. It can therefore not be recommended to change the loan appraisal disburse- ment and supervision system of CLCA at the present time and to adopt the system used by Headquarters and the CRCAs because exorbitant increases in operating cost would be the consequence (see also para 45). All CLCA cost projections are consequently based on the assumption that such changes will not be made during the period under consideration. 82. Relative cost of lending could be lowered by improving the working efficiency of the staff. Incentives should be given to the staff in the form of a premium system that would award premiums for targets achieved in im- proving the ratio between overdues and portfolio at the beginning and the end of each year. A premium system of that kind would simultaneously take into consideration improvements in loan disbursements and in recovery rates, the latter having a big influence on the liquidity position of CNCA. Any improve- ment in personnel efficiency could then be measured by comparing the amount of loans outstanding per staff member at various dates. 83. Absolute personnel cost invariably will have to grow for both Head- quarters/CRCA and CLCA operations as consequence of the increased recruitment and of new personnel regulations hopefully introduced in 1976/77. It is assumed that CLCA personnel costs grow faster than those of Headquarters/CRCA because CLCA will employ more new staff to man additional branches. 84. Also in the seven years projected, the cost of CLCA's lending operations is bound to increase, both in absolute and in relative terms, because of the increases in personnel cost as mentioned before and the increase in financial charges as the following table shows: ANNEX 2 Page 27 Operating Cost Loans Disbursed Percentage --------------DH'000-------------- 1975/76 CLCA 13,509 119,845 11.3 HQ/CRCA 45,133 584,043 7.7 1976/77 CLCA 19,226 196,875 9.8 HQ/CRCA 52,689 683,621 7.7 1977/78 CLCA 25,428 215,203 11.8 HQ/CRCA 59,240 763,217 7.8 1978/79 CLCA 32,986 235,301 13.0 HQ/CRCA 66,870 849,156 7.9 1979/80 CLCA 40,533 257,350 15.8 HQ/CRCA 98,969 987,410 10.0 1980/81 CLCA 47,462 281,505 16.9 HQ/CRCA 112,554 1,099,069 10.2 1981/82 CLCA 52,947 308,020 17.2 HQ/CRCA 127,342 1,226,298 10.4 Total/Average CLCA 232,091 1,614,099 14.4 HQ/CRCA 562,797 6,192,814 9.1 Grand Total 794,888 7,806,913 10.2 85. Because of the increase in personnel cost expected for both CLCA and CNCA/CRCA operations, the relative cost of lending is expected to grow slowly. However, there would be a large increase in 1979/80, the year when additional funds from outside would be necessary to finance the projected lending operations. After 1979/80 the relative cost of lending would grow slowly for another two years and then start declining. 86. The other main factors influencing the net income is the interest income as a direct consequence of interest rates. As already pointed out in para 44, interest rates for CLCA lending have not been changed since ANNEX 2 Page 28 quite some time and Government is subsidizing small farmers through the interest rates by way of compensating CLCA for the operating losses incurred in any one year. By the same token, the Government tried to make the small farmers program more acceptable to CNCA. Despite the fact that Government has set priorities to assist agriculture in general and small farmers and cooperatives in particular it must be considered as very questionable whether subsidized interest rates are as advantageous as they look at first glance. In the case of CLCA, the average rate for medium-term loans of 6.5% per annum hardly covers the inflation losses and the result of an unchanged rate would be that in the future ever-growing amounts of the State budget would have to be made available. Normally, interest rates which will not cover administrative costs and bad debts, do not enable an institution to generate more loanable funds and weaken the entire structure of a credit pro- gram. They also constrict rural development by discouraging the mobilization of savings. As a first step to make also the interest rate for CLCA medium- term lending more realistic and to correct the present bias against short- term loans agreement has been reached to increase the average rate to approx- imately 7.65% per annum. 87. A higher increase would at present not be advisable because there should be a slight difference in rates between CLCA and HQ/CRCA customers, and their rates for loans to individuals cannot be augmented due to the fact that interest for loans from commercial banks for other sectors of the eco- nomy are between 8 and 10% per annum, and any further increase in HQ/CRCA lending rates would damage their competitiveness. 88. The repercussions on CLCA's projected income would be that losses would also occur in the following years. In relation to the operating cost, however, the losses to be compensated by Government, would decrease from 44.5% in 1974/75 to 22.6% in 1976/77 and 17.9% or 21% respectively in 1977/78 and in 1978/79. Only in 1979/80 would they start to grow again. Further interest rate increases would become necessary if the ratio of losses to operating cost would exceed 23%. 89. Interest rates charged by HQ/CRCA since September 1, 1975 allow CNCA to cover costs and to make a small profit. The rate of 8.5% for medium- term loans to individuals should be maintained. The rate for medium-term lending to cooperatives and farmers' associations, which at present is 7%, would be increased to 8.5% because cooperative members at least after a few years of operation are usually in a better financial situation than individual farmers. However, since members of newly-created cooperatives, who were previously landless farm workers or subsistence smallholders, have no means for self-financing, the interest rate during the first four years of operation of cooperatives would remain at 7%, in the fifth year it would be increased to 8% and only in the sixth year would it reach 8.5%. Interest rates for short- term lending should not be increased at this point. ANNEX 2 Page 29 90. Projected interest income of CNCA/CRCA in the period up to 1981/82 would grow as follows: CNCA/CRCA Interest Income --% Increase-- Net ST MT Total ST MT Total Profit % Increase 1975/76 16,379 24,482 40,861 - - 31 3,244 186 1976/77 21,068 31,910 52,978 28 30 30 9,047 179 1977/78 23,881 40,397 64,278 13 27 21 15,028 66 1978/79 26,573 48,390 74,963 11 20 17 19,165 28 1979/80 29,486 57,226 86,712 il 18 16 18,565 (13) 1980/81 32,869 66,216 99,085 Il 16 14 15,946 (14) 1981/82 36,616 76,047 112,663 il 15 14 6,978 (56) Lending Norms 91. Lending norms for Headquarters and CRCA lending operations are ade- quate but together with CLCA lending norms would be reviewed periodically in order to incorporate necessary changes. Lending norms for cooperatives (see para 52) would be revised to the effect that cooperatives would have access to short-term finance for agricultural inputs, also after the sixth year of their establishment. In order to take due consideration of the total lack of funds of the cooperative during their first years of existence, during their first year 100% of their short-term needs would be financed. This ratio would decline to 80% in their second year of existence. From the third year onwards, the financing ratio would be in line with the norm laid down in the lending regulations. For medium-term loans to finance investments, a difference in financing ratios would be made between initial investments and replacements. Initial investments would be financed at a ratio of 100% during the first four years of existence, the ratio would go down to 80% in the fifth year and from the sixth year onwards the norm would prevail. Replacements would always be financed at the norm ratio. 92. The appraisal system for cooperatives as described in para 55 seems to be adequate for cooperatives in their first years of existence, because in this period they are very closely supervised by MARA and they normally make standard investments only. Gradually, however, the appraisal would be delegated the to the staff of the CRCAs so that the credit needs of each cooperative could be individually assessed and appraised. Also the approval of cooperative loans would be delegated to the CRCA Loan Committee. Such a new procedure in loan appraisal and approval would simplify and shorten the adminstrative process involved and may have the effect of increasing the loan disbursement/commitment percentage, which at present, due to the inaccurate appraisal with a rate of 70%, is very low. Overdue Loans, Bad Debts and Provisions 93. Table 22 shows principal and interest overdue at April 30, 1976 and gives a breakdown from which periods the overdue amounts originate. Only less than half of all amounts overdue on April 30, 1976 are overdue ANNEX 2 Page 30 for more than twenty months whereas the balance is overdue for more than two and less than twenty months. For CLCA, the corresponding figures are 16.2% and 83.8%, respectively, resulting in a much better picture.. The same table undertakes an attempt to calculate that portion of all overdue amounts of CNCA Headquarters and CRCA lending that is actually considered bad debts. The basis for these calculations was the amounts of provision and the under- lying principle that for amounts overdue between 15 and 26 months provisions of 50%, for amounts overdue between 27 and 38 months provisions of 75% and for amounts overdue more than 39 months, provisions of 100% should be made. This principle is adopted for all CRCA individual customers whereas provi- sions for customers of HQ are made on a case by case basis. As soon as a loan is 100% provided for, interest calculation is ceased in order to avoid undue inflation of accounts receivable. The ratio of provisions to overdue amounts decreased from 28.6% in 1972-73 to 9.6% the year after and 9.2% in 1974-75, a ratio which must be considered as satisfactory. In the projec- tions, the ratio of provisions to amounts overdue for CNCA/CRCA operations has always been kept at 10%. 94. At the end of 1974/75, CLCA's guarantee fund had reached the amount of DH 7.6 million, which in sharp contrast to the percentages men- tioned above for CNCA/CRCA operations covers 61.5% of the amounts overdue at the end of the year. It\has been agreed that no further amounts would be transferred to the guarantea fund and that all future initia:L fees collected from CLCA customers would be considered as interest income, until such time when the guarantee fund would be lower than 10% of the amoun!:s overdue. At that time provisions for bad debts would have to be made following the same principles now adopted by CNCA/CRCA. Accounting Principles and Audits 95. CNCA loan accounting system is computerized and works satisfac- torily. It would, however, be desirable to review the computer programming to arrive at a more detailed breakdowrn of loan portfolio accounts to the extent that a general distinction between collections on interest and on principal should be made and that the loans and interest amouints would be classified by year of origin, by due date, by beneficiary and by source of financing under special consideration of IBRD or IDA financing. Such modification would enable CNCA to subdivide the portfolio into overdue and not yet due loans. For overdues the evolution of the balance would be followed by year of origin year after year until arrears would be fully repaid or transferred to the bad debt account or finally written off. For loans not yet due the breakdown of loans by maturity date would give CNCA management valuable information for forecasting caslh flows. 96. Since the financial year 1971/72, audits are undertaken by an independent company. Initially, the audit reports were finalized too late after close of financial year to be of any value and did not rnake any recom- mendations with respect to accounting principles and internal controls. The finalization dates of the reports have now greatly improved and recommenda- tions to CNCA management are made in separate letters. It is recommended ANNEX 2 Page 31 that CNCA for future balance sheets should also adopt the system of breaking down assets in current and non-current assets and liabilities in current and non-current liabilities in order to make their own balance sheet more easily comparable to the balance sheet evolved by the auditors. It is also recom- mended that CNCA consider writing off bad debts a certain number of years after they have been fully provided for, and if no repayment can be expected. Financial Gap 97. As the cash flow in Table 19 shows, the proposed IBRD loan together with the proposed loan of the Arab Fund, would cover all finance requirements until and ineluding 1978/79. From 1978/79 onwards additional funds would be required for both HQ/CRCA and CLCA operations which have been considered in the projected income statement with an interest charge of 10% per annum. Over the last four years, the cost of funds has been between 2 and 3% for CNCA and slightly lower for CLCA. They are expected to increase to approximately 4.4% for CNCA and approximately 5.1% for CLCA in financial year 1981/82 (see Table 8). ANNEX 2 Page 32 List of Tables Table 1 Members of Administrative Council Table 2 Organigram of CNCA Table 3 Organigram of CRCA Table 4 Breakdown of CNCA Personnel by Occupation & Background at May 31, 1976 Table 5 Terms of Reference for Study on CNCA Training Needs Table 6 Summarized Consolidated Balance Sheet 1970-,71 Table 7 Audited Consolidated Income Statements 1970--71 Table 8 Cost of Funds Available to CNCA During the Period 1970/71-1981/82 Table 9 Breakdown of CLCA Loan Files per Fiscal Income Groups Up to DH 3,000 Table 10 CNCA Loan & Interest Recoveries 1972/73 - 1974/75 Table il Agrarian Reform Cooperatives - Recoveries as of January 31, 1976 Table 12 Conditions & Norms for Loans - CLCA Table 13 Conditions & Norms for Loans - CRCA Table 14 Present & Proposed Interest Rates for CNCA Lending Table 15 Levels of Loan Approval and Maximum Loan Amounts in Lending Operations of CLCAs, CRCAs and Headquarters Table 16 Development of Lending Program to Individual Farmers 1971/72- 1974/75 Table 17 Development of Lending Program to Farmers' Groups, Cooperatives & Companies Table 18 Analysis of Auditpd Financial Statements 1970/71-1974/75 & As Projected for 1975/76-1981/82 Table 19 Projected Cash Flow 1975/76-1981/82 Table 20 Projected Consolidated Income Statements 197.5/76-1981/82 Table 21 Projected Consolidated Balance Sheet 1975/76-1981/82 Table 22 Principal & Interest Overdue at April 30, 1976 compared with Provisions for Bad Debts as at August 3.1, 1975 Table 23 Equity Investments at Cost Price Table 24 Farmers Reached by CNCA as of January 1, 1977 Table 25 Equivalent Interest Rate PiM'Wer~Temporis for Medium-term CLCA Loans ANNEX 2 Table I APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Caisse Nationale de Credit Agricole MEMBERS OF ADMINISTRATIVE COUNCIL CHAIRMAN: The Minister of Agriculture and Agrarian Reform OTRER MEMBERS: Director of Studies and Economic and Legal Affairs, Ministry of Agriculture and Agrarian Reform Head of Extension Division, Ministry of Agriculture and Agrarian Reform Director of Water and Forest Administration, Ministry of Agriculture and Agrarian Reform Head of Cooperatives and Agricultural Credit Department, Ministry of Agriculture and Agrarian Reform Deputy Director and Head of Budget Division, Ministry of Finance Inspector of Finances, Ministry of Finance, and Financial Controller, CNCA Secretary of the Agricultural Commission of the Coordination and Planning Division Head of Local Collectives Department, Ministry of the Interior Deputy Director, Head of Credit Department, Bank of Morocco Eleven farmers, one each representing the Provinces of Agadir, Beni-Mellal, Casablanca, Fes, Kenitra, Marrakech, Meknes, Ouarzazate, Oujda, Settat, Tetouan General Manager CNCA (without voting power) APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT ANNEX 2 Table 2 MOROCCO Caisse Nationale de Crédit Agrioole ORGANIZATION AND | GENERAL MANAGER .ORESPONDENCIE |METlODS UNIT DEPUTY GENERAL MANAGER UNIT CREDIT DEPARTkF ACClUlNTIN DIVISIOR SERVICESç ;NDMINISTRATIV SliPLIES ANE CA DIVISION ENERAL INSPECTO EPATMENT FOR GENERAL DIVISION FOR 2URIDICAI! REI DEATMY nd BANKING DEPARTMOENT ~ DlVISION SERVICES EQUPENÇ DEPARTMF. NTEERI AND PROFESSTONAL AFFAIRS AND LEGAL k DDIVISION IVISION TRAINING PROCEEDINGSS Division lot indi- Accounting Division Control Personnel Insurance Coordinatin, EIspIoyisent and Profesaio- Liquidation Unit vidual Loans i Services and BuildinB Section nal Training Section Operations Services Organization and Program- Division for Group Finance and Banking Programing Social Sp Zones Legal Proceeding 8 Loans ^ } Division l | SServices services Statistic Sectionj | | REGIONAL ZONAL ONES { TENSIFT AND SOUI|| SOUTH CENTRAL NORTH WEST NORÎNH CENTRAL AND EAST| CENTRAL I - - --I I d I 4 I I~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ CRCA Agadir CRCA Méknès CECA Rabat CRCA Fè|s CRCA El-Jadida CRCA Casablanca CRCA Marrakecl | CRCA Errachidia CRCA Kénitra | CRCA Taza |CRCA Sid'-Deilouc CRCA Berrechid CRCA Ouarzazate CRCA Khéfina CRCA Tetoulan CRCA iidr CRCA Fkih Ben Salah CRCA Settat CRCA El-Kelâa CRCA Larache CRCA Oujda CRCA Beni-Mellal. CRCA Khouribga ^ R A Safi llr .lllll1 | CLCA'ZONES l l CLCA ZONES CLLCAZONESCA ZONES CLCA ZONES ClIA 7ONES - Agadir - heknès j - Rabat - Fes | - El-Jadida i Casablanca - Ouarzazate - Errachidia - Kenitra R _ Nador - Beni-Mellal B- errechid M- arrakech - Khéoifra - Tetouan - Al Roceima - Settat - El-Eel~~~~~~~~~~~~~~~~~~~~~~a - ~~~~~~~~Taz - EKhouribga f- a| - Oujda -Tarfaya APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO ANNEX 2 Table 3 CAISSE REGIONALE DE CREDIT AGRICOLE DIRECTOR| DEPUTY DIRECTOR DMINISTRATIVE UNITI SECRETARIATE I a CASHIER'S AND ACCOUNTING| LOAN SECTION | LOAN COLLECTION SECTION SECTION - Bookkeeping |ADMINISTRATIVE UNIT |TECHNICAL UNIT - Loan and Interest Section - Cashier's Services - Legal Proceedings - Banking Services - Negotiations with I - Loan appraisal - Deposits clients - Loan supervision - Processing of loan applications - Keeping of loan files - Disbursement proce- i dures - Statistics I~~~~~ APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO ANNEX 2 Table 4 Caisse Nationale de Crédit Agricole Breakdown of CNCA Personnel by Occupation & Background at May 31, 1976/ Ventilation du Personnel par Fonction et Education au 31 mars 1976 Headquarters CRCA CLCA Total Master's Degree 3 - - 3 Dipl8me d'Etudes Supérieures Agricultural engineer 14 13 - 27 Ingénieur agronome Graduates of Faculty of Economics 24 10 - 34 Licenciés Sciences et Economie Other university graduates 14 3 - 17 Autres licenciés Other non-classified staff 19 2 - 21 Autres cadres non-classés High school graduates 29 7 37 73 Bacheliers Associate degree in law 5 1 - 6 Capacitaires en droit Agricultural technical assistants 15 111 1 127 Adjoints techniques agricoles Other assistants 5 3 14 22 Autres adjoints techniques Staff for data processing 46 - - 46 Techniciens de l'informatique Accounting staff: Cadres comptable: University diploma in accounting 2 1 - 3 Diplôme d'Etudes comptables supérieures High school diploma in accounting 3 - - 3 BTS Junior school diploma in accounting 48 75 249 372 DTM Other accounting staff 22 44 51 117 Autres Junior professional staff 23 16 72 111 Rédacteur Secretaries & typists 38 92 - 130 Secrétaires, dactylos Administrative secretaries & clerks 29 82 3 114 Secrétaires.administratives et commis Office boys 16 30 - 46 Chaouchs Drivers 8 28 - 36 Chauffeurs Staff employed on casual basis 17 26 - 43 Journaliers et temporaires Total 380 544 427 1,351 Total APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT ANNEX 2 Table 5 MOROCCO Caisse Nationale de Crédit Agricole Terms of Reference for Study on CNCA Training Needs 1. Evaluate the existing CNCA staff training program. 2. Identify the requirements within CNCA for the following types of training for different levels of staff: (a) for junior staff: procedures of credit administration and bookkeeping; basic agricultural recommendations related to inputs for which credit is provided; (b) for intermediate staff: farm evaluation and credit admin- istration for loans to medium income farmers, and (c) for senior staff: banking procedures. In addition, identify and define training requirements of senior and intermediate staff in management, supervision and training skills. 3. Examine the existing training facilities within Morocco in the field of banking and agricultural credit (particularly the Banking Institute at the University, and the Rural Development and Extension Training Center, and National School of Agriculture at Meknes), and determine whether a separate institution will be necessary to provide the training required by CNCA or whether facilities could be added to an existing institution. 4. Make recommendations on the following points for an expanded CNCA training program: (a) nature of training to be offered: length and content of courses for different levels of staff; entrance requirements, and student numbers; (b) requirement for new teaching staff and training necessary for them; (c) facilities required, siting and cost; (d) administration of training facilities and organization of training within CNCA. 5. The training system must permit close liaison with on-going in-field, in-service training, and must allow staff to be released for central training course. Make recommendations on how these are to be achieved. A 10IRD AGIICISTJMI CR11?F010 8818C10 AIMa Table 6 Cai..e Nationae- de Cré801t Aricot1 Sumngrîed Coneolîdted Balanc Bheet/19'70-7-19-5BiaCocld ortqaf bout31, 1971 Acte 1 17 cot 31 , 1973 A1ut 31, 197 4 Ajguet 31, 1975 April 3O, 1976 )19'7o/35) <11/2 1727) _________ (191174/5 17/6 ALSE_SIT Oofne n-fîil ACTIF Correc A e..la Aooto lrula Cati & Ba- fron Banc 14,855 21,075 47,016 32.078 68,26i 20,917 Cal af e Bnoqce bac eîaîenthio I Year, Gr... PrOte 'b Moine d'a dlo, Bette Corret Fernionl ffi - eîc-trn Lan ... 68,008 104,00 134,008 180,qwe3 Part Cotant dec Prlt ctye.'e.e Ill ~~~~~~~~174,081 171.577 189,667 185.404 218.52615 e. -. for Anaîttol Belle ~(4,792) 16,9(4C4 4,799) (5,314) <591< ':g pose oraaree d .te.eee. Transport & travel silooeser 381 116 497 523 134 657 646 143 789 825 201 1,026 851 427 1,278 Transport et dSplscsaant SubeontrCeted ad-ivlattative =erviece= Trraau fournitures et services eatéeiauts, inlueding Crent & aintesacr 379 138 317 477 141 618 1,032 650 1,682 1,212 681 1,893 1,'91 845 2,036 loyer et entretien Occlue yiiseeîîaseove adaioitetatlvt eoet 1,146 155 I,30l-/ 311 IS8 509o/ 1,468 396-/ 1,864-/ 1,750 6735Q/ 2,423-/ 1,880 637 2,51713/ FPrai diver- de gestiao isprts et t-ses intlus itcluding t-ues Tut.l Operatig Espensea 15,.04 3.449 18,533 16 444 39804 20_428 24_857 6_265 31.122 29.575 9 658 39 233 35 633 12 952 48 355 Total Charges d'Erploitatione Net Opeeating Ineor fPo thr Y-ear 4,512 (121) 4,391 6,455 6,455 1,108 101085/ (498j (498) 1,135 1,135 Béfic Net de= oprati.n. de 1 Exercice OErtraerdînaey ineoil 121-/ 121-/ 1,048- Revenus -- ceptionnels Net It-ose for the YOer 4_91 4.512 6 495 6.455 1-100 2.156 <498) (498) 1.135 1.135 0énéfiee (Perte) de l.Eerels 1/ Coluan =howing difforence brr.etw e..osolidattd figuras given iI audit rapora= end uoscdited figeras 1/ cette eclonne repréenCte lu différrane antre les ohifft es eon=olide= dans le= état= iinaeiers vértifi et las thiffres for CLCA non-vérifié= d= atat= finaneier= de le CLCA 2/ 120,688 (If totai DH 1,050,506) lr1aady paid in 1969/70 / DE 120,688 (du total de DH 1,050,506) d4ji peyes es 1969/70 3/ Iceluding DH 323,674 harraoodinary eh-rge 3/ Charges exceaptri olles de DN 323,674 iccluse= 4/ B.la.ced bith DU 650,746 eetraordinery profits 4/ Solde avec Dl 650,746 de béCafiCesexceptioenle 5/ Taking inta sreosst the auditor's qoalificatice thbt Iutereet on l-ans -aa ove=tateed by DH 400,000 S/ Ceepte tesu des qoalifieations des saditrces que les Iter pts s t nt eté ecestlshe de DU 400,000 Correetis.e bave been nade os CNCA interes=t oly L. cté f.it. ..ui_nt ... 1 . de 1. CNCA 6/ Includieg DH 4,585 actrsoedlnary charges 6/ Chbrge= aexeptionnelle= de DH 4,585 incluses 7/ Ineluding DE 236,133 saeeasrddnary ohbrges 7/ Ch-rges exceptiannelle= de DH 236,133 ieeluse. 8/ AeCeuslatnd isesrn of DO 1,047,757 eelt.od te DR 428,000 peopartie= ced inve=tmenc= trti=ferred te S/ R=enase -css6eé de Du 1,047,757 yant eppeet i des titres de partiCipatios et ioccebiliaatio.s d'usa va-leur de CNCA in.as by deelsica ef the Miaistey of Fi.ases DH 428,000, treasfeCra au b&néfiee de le CNCA par déciaion do il niat%e de Fintiee 9/ Ttking into aceout the aodit,r'a qceMfieatioc that itresest on 1-ans nos evers eoted by D16 1,600,00 Copte tenu d qalifieti de aditne qse intérêt= sur potes oct rté eures s da DU 1,600,000 10/ Ineluding DR 2,030 astCeoeditsey charges ID/ Chaergs sabyrissneilee de DN 2,030 ferla 11/ Taking into eesont the sudite qcaificatisn thbt opee-tieg exp-ntee ses- orererared by Dh 300,000 11/ Ceopte teeu des qoeliteaticne des auditeurs que ira CeSeges d'ecploitatios ont étc ssrseOla;es de DR 300,000 2/ Tskisg Osto aeeount th. enditors' quaLlfîcrOon that thc Iranen hac bas bee-convsrted inte s 12/ Coapts tenu des queficios da- cadite.res que l'erpetne Irenen dolit ete naintenant constid.t cas use dotutisn Ie-nt sed thbt thereforc the itese Governssest Subvantion *nd IntereN rses overstattd by DH 664,000 - capital pour letCLCAtee que las aselpast subvention eOuveresestels et lnt6rêt= set dose 6tt surestiasda de DU 604,900 13/ Oselsding DR 473,559 nutrasrdisey eh-rges 13/ Charge= e..eptio--e-le. de DS 473,559 iselus -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - -- - - - - - - - - - - - - - - - - - - - - - - - -- - - - -- - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 2222222~~~~~~~~~~' 224 2224 222 ' 224 224 22. 22- -- 244 22i. 224 2224 524~~~~~~~........ .- -- ----- --- ------- ------- ------ 2222 222 2222 _ 2 222 222 22 ~ 424 2422 222 ,24 2> _ __442 2-22 242 22A n22 222 242 2 2----------2-2222 -lC--__---_ 8829222222222.2 s,22222 22,92,i .22222022 .22,,222.2-424222,t22-22,422>2 22>2 n', 22222 2.222,n222, 2 9 4....,2222 22-,2 4.2n 4222 42,, 4..22.n52i2.2 28292222222 - 2.222>9 22 12 42 2 2>2 - 2, 42 2> 2 i 22 2.W 4 12 4 22 22 2> 2- 2, 22 2> 2 22 22 22 2- 22 22 22 -29 22Il2 8'22222 25 22i~~~4- 92.222 21229 - i2222 22,222 - 21222222,222 - 2224n422.222.2222222iii2 222 222.222 4222i- 422.i2~~~~~~~~~~ 222,224 iii 422224. 422,22442222 .224 222 222.224222,ii2 222222.224 224.222222i22.222 222222 v~~~~~'11 22i - 2.25 2.2i 2.2 222. 2.2, 222 2 222 2222 2 22 22- 22 2 4 ni2 2 2 2 2 2 2 2 4~ 2 4 >4 2.2-2 9222 . 2-n 2.9 2.2 - 222222 22,22 - ii.28 22,422 - 442'2 2 22 -22. 22.n 2 - i.2n 24. -22> 2222. 42 - 22222 42>22 22,22242.22 - ~ 2,2Il2122 - 2222222,22 - ni,222Il 5 - -- 2i .2 22 - 2 2 22 - 2 4222422 442 Z 2.42-2<2- APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT ANNEX 2 Table 9 MOROCCO Caisse Nationale de Crédit Agricole Breakdown of CLCA Loan Files per Fiscal Income Groups Up to DH 3,000/ Ventilation Dossiers de Pret CLCA par Tranche de Revenu Fiscal jusqu'à DH 3,000 Fiscal Income Group -------Number of Loan Files ----- % of Total Tranche de Revenu Fiscal Nombre de Dossiers de Prets % du Total Short-term Medium-term Total -Court-terme Moyen-terme Total DH 100 - 200 707 33 740 0.4 201 - 300 1,564 121 1,685 0.9 301 - 400 720 4,580 5,300 2.9 401 - 500 935 5,692 6,627 3.6 501 - 600 1,131 6,444 7,575 4.1 601 - 700 1,259 6,527 7,786 4.2 701 - 800 1,409 6,834 8,243 4.5 801 - 900 1,643 9,266 10,909 5.9 901 - 1,000 1,742 9,000 10.742 5.9 1,001 - 1,100 1,763 8,821 10,584 5.8 1,101 - 1,200 1,727 8,367 10,094 5.5 1,201 - 1,300 1,646 8,043 9,689 5.3 1,301 - 1,400 1,503 8,049 9,552 5.2 Subtotal I/Soustotal I 17,749 81,777 99,526 54.2 1,401 - 1,500 1,462 8,250 9,712 5.3 1,501 - 1,600 1,490 8,265 9,755 5.3 1,601 - 1,700 1,436 7,829 9,265 5.0 1,701 - 1,800 1,297 7,151 8,448 4.6 1,801 - 1,900 1,172 6,350 7,522 4.1 1,901 - 2,000 1,056 5,535 6,591 3.6 2,001 - 2,100 812 4,262 5,074 2.7 2,101 - 2,200 664 3,692 4,356 2.4 2,201 - 2,300 518 3,037 3,555 1.9 2,301 - 2,400 481 2,721 3,202 1.7 2,401 - 2,500 419 2,357 2,776 1.5 2,501 - 2,600 331 2,131 2,462 1.3 2,601 - 2,700 325 1,815 2,140 1.2 2,701 - 2,800 254 1,529 1,783 1.0 2,801 - 2,900 211 1,389 1,600 0.9 2,901 - 3,000 175 1,448 1,623 0.9 Unknown groups/ Tranches inconnues 76 4,295 4,371 2.4 Subtotal II/Soustotal II 12,179 72,056 84,235 45.8 Total 29,928 153,833 183,761 100.0 APPIAISALL 0F A 79155 AGRIOEITU1A1, I811 noFR01 iIOROCCO .82188 2 CNCA 1- 1 -e-.- e. 1974-751R.- -e Ple- 6 CRCA ~ ~ ~ ~ Tble 1 iodîo idua -loone U T-1 1A1 Grad--u/vîda_toes CoupbaC CIC T-aod Inrd -too Croup Liens ota ACA Torand prIncipal A la terce t ooorioeet 722699 4,271 26,969 35,691 83,784 119,475 S,104,'- 124,575 Sl,ll4~/ 52.l98e 104,102 9,i82&W43,930 es4o rota et ltr7. ~o FOoIa t.etees Pollen dos durlng y-e 171,038 48 169 219,207 164 651 111.057 275.708 64.851 340_559 225 811 118f,890 344.701 70 592 îi7297EchSsnaes -plcpltie~5~ od-a 'aao sottosa1 193,737 52,439 746,176 200,747 194,841 395,183 69,951 465,134 276,979 171,878 448,803 80,420 529,223 Souetota1 Prlocîipal Acretreoerdo 11,234 3.587 14,816 17,516 37,710 F5.786 4,264 79,000 37,671 29,591 67,262 7,764 75,026RtotmresOr1atrio fcrc-tsge 49.5 83.9 54.9 49.1 69.9 63.0 83.6 63.0 73.7 .55.0 64.6 79.1 65.9 roorc-tage PrIncIpal --tco rcord ut 147,340 47,610 189,968 125,462-/ 90,393 215,875 57,826 273.081 l79,400S7~ 94,7209'/ 274,1275'-60,356 334,,4764/ eeooest o e niotada ecc Ferneotîge ~~~~~ ~~~~~ ~~86.1 88.5 06.7 76.2 81.4 78.3 89.2 80.4 79.4 79.7 79.5 05.5 80.5pocntg Total stouclo rscorersd ~~~~150,574 46,710 704,784 142 978 148,153 791,081 62.090 353,171 2717071-~ 124,311- Uds,38i-968,I20 409,5029/ TocOl d-ssorsor Fererorsos ~~~~ ~ ~~~~~~81.9 88.t 83.2 71.,4 76.0 73.7 88.8 75.9 78.4 72.3 76.1 84.7 77.4 Pourcentage Fren.ip.1 4 irt.eres oerdse et Ned ut y-a 35,163 6772942 37 5,6 678 5,0 87 1193 5,5 757 107,471 12.3002/1.71Annteor- 4srintipsl etftrsal ir de . oeoc 01-- poefol o - loes ocrud lotert - 76,1092/450,704» - - 790,315 9795 488,285 - - 504,600 ll2,Z02- 616,702Sesr (pîtll etntrtaulsIe Bc debt -aty prou.dd for 14,454 - o.. 15,797 7,676 10,423 - t. 8,934 2,719 11,653 - s.t4ao oroe aeslee ruaote Feîi -o OtfOilO .. 500 - - . e ta 2.3 s. t.Pucnaede lecor ....soss/C trsre Fusd 7,734 4,319 l4,4l1#' 7,527 2,346 9,868 5,888 15,756 7,529 2,394 9,923 7,562 17,485 P-uod-t et Iode de OGrante Ferceotge rveo/urne 7usd ta 53.5 05 9.. 47.6 89.3 53.6 as ,, 84.3 08.0 85.2 .. Op otctn rvstee Posdu de ea.e bcd dnls rsNe dueue rerceurepa proolelo/Ouarsntee Puai ru 22.0 69.3 u. 13.1 9.0 9.5 74.9 14.1 12.6 3.0 9.7 61.5 14.6 poceaepoiln ttnsd aste vrdetetd of yeratnc, O le fi. de tlexrac Ordtroprs crfnil.u - 8.7 0.. - 6.7 8.0 27.9 - 7 1.3 11.7 19.4 Pourcetage ttretr O la fi.s do ,eerie 1/Oeo_r Infapbcsea oise s autcpr 92/31 rsaent de- Frt olsrtaee diqo.. dau le rePPort -.1o, 1977/73 2/ Ase PcoJact Frparsîti. Report 2/ toss lodqu dasl apr epprts oPoe 4/ St t,aclgPi1,384.505 adoa,rcd tspsy-eUt /tI13459rsoreeneatcpeenIle 5/ Rsdu..ed bymcaiis o -lsit oaseoloh Oec re-tnd 5/Le montat s 8t1 dtntna dr tU etsreoîe 6/FIgure oteearns y sUitelaltg pr-toatt-pauî..e .. tooper-î groupe sId SODOGA fr-o -nîîullaead 6/' hîters- ou de. odifi.e se dîinnan.t les pr,Ote tedicid-ols des pr9t pou ..orodO prtvér, gopmns odle hnto erop mo- rartestSOP)EA ets unnatlaprete collecIfs etsoqe 7/ Nul tnlding 5H 11,212 adva..c.drepay-.ets 11 1, 21 rebseseu atiaipâe aoe tectua 8/ N.t -...d-. 38 1,726e.ea0 ndtecNdre-p.et 3/Hl 11,776,560 rmorent etcsoninol-e 9/ Sot iiscludieg DR 11,737,772 9dua-cd1re37,es72 107 Nul lu accod-sr lith figure.a eti utd Isst y-o beeuetolrlee1.d Icer-- -ud prnelty oIaPes. Ceedded 10/ Lmechifftra ns coruodP.. 'à l'st4e,, 4â la fiu de . eecr d.eraar p., nuite de leodîtle dOsirr - Ptaplîslîs et de fr,ais do orut ANNEX 2 APPRAISAL OF Table 11 A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Conditions & Norms for Loans/CLCA/Conditions et Normes de Financement pour Principaux Prêts (in condensed form) Investment Category Norms Applied/ Period Granted (ST) or Term (MT) Repayment Dates Investissement Norme Appliquée Période d'Octroi(CT) ou Terme (MT) Echéances Short-term Court-terme Grains DH 250/ha 9/01 - 3/31 6/1, 7/1, 8/1 Céréales Hybrid maize DH 400/ha 2/01 - 4/30 9/1 -- 10/1 Mais hybride Pulses DH 250/ha 9/01 - 4/30 7/1 - 10/1 Légumineuses Vegetables DH 800/ha All year/Toute l'année 6/1, 7/1, 8/1, 9/1 Maratchage Rainfed fodder DH 250/ha 5/01 - 4/30 At harvest/A la récolte Fourrage sec Irrigated fodder DH 500/ha All year/Toute l'année At harvest/A la récolte Fourrage irrigué Plantation maintenance DH 3-5/tree All year/Toute l'année At harvest/A la récolte Entretien de plaitation Harvest DH 100/tree 4/01 - 6/30 6/1, 7/1, 8/1 Moisson Beef cattle fattening @ DH 700 All year/Toute l'année At sale/Commercialisation Embouche-bovins Sheep cattle fattening @ DH 100 All year/Toute l'année At sale/Commercialisation Embouche-ovins Medium-term Moyen-terme Farm equipment 80% min. 0.5/ha 2 years 6/1, 7/1, 8/1 Matériel de culture Pumps 80% min. 0.5/ha 5 years 6/1, 7/1, 8/1 Matériel de pompage Draft animals DH 2,000 max. 3 years 6/1, 7/1, 8/1 An-imaux de trait mn. 0.5/ha Destoning & clearing DH 400/ha 3 years 6/1, 7/1, 8/1 Défrichement-épierrage Irrigation & drainage 80% 5 years 6/1, 7/1, 8/1 Irrigation-drainage & well drilling 2 et creusement puits Animal shelters DH 60/m 5 years 6/1, 7/1, 8/1 Abris à bestiaux Cattle 4m2/head Bovins Sheep 0.5m2/head' Ovins Dairy cows 80% 3-5 years 6/1, 7/1, 8/1 Animaux de rente Plantation 80% 5 years 611, 7/1, 8/1 Plantation APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO ANNEX 2 Table 12 Caisse Nationale de Crédit Agricole Agrarian Reform Cooperatives - Recoveries as of January 31, 1976 Coopd'ratives de la Re'forme Agraire - Situation des Recouvrements Arre'tée au 31 ianvier 1976 Principal Amounts Fallen Due 7/1/75 - 1/1/76 Commitments / Disbursements / Percentage Echéance du 1/7/75 au 1/1/76 en principal Recoveries % Recovery C.R.C.A, Montant uMontant Réalise Porcentage d Amounts Fallin Due Overdues Total Due Remboursements % Rem- ________ Accrde' Montan R~a1is PoRcenistageod Ech ance Antérieur Exigible Total boursement -------------------_------_----------------------------DH' 000----------------------------------------------------------------- Beni Mellal 6,777 4,091 60 446 1 447 447 100 Berrechid 8,556 5,986 70 1,788 58 1,846 848 46 Casablanca 3,877 2,549 66 512 62 574 542 94 El Jadida 3,260 1,812 56 474 - 474 443 93 El Kelaa 10,583 6,921 65 822 70 892 598 67 Fes 30,004 19,592 65 4,760 168 4,928 4,546 92 Fquih Ben Salah 1,642 849 52 8 12 20 20 100 Kenitra 21,262 13,983 66 2,297 117 2,414 2,363 98 Khouribga 1,961 990 50 182 1 183 183 100 Marrakech 6,957 4,646 67 973 - 973 764 79 Meknes 23,273 16,773 72 2,609 5 2,614 2,570 98 Nador 2,353 718 31 98 383 481 67 14 Oujda 3,493 1,519 43 252 24 276 266 96 Rabat 6,727 4,171 62 904 - 904 716 79 Safi 2,884 2,091 73 416 - 416 68 16 Settat 6,079 3,557 59 380 10 390 215 55 Sidi Bennour 12,666 5,260 44 928 8 936 160 17 Taza 11,626 8,578 74 1,470 - 1,470 1.470 100 Total 163,980 104,086 63 19,319 919 20,238 16,287 80 1/ Commitments and disbursements of financial year 1975/76 are not included 1/ Les attributions et les réalisations au titre de la campagne 1975/76 ne sont pas incluses ÂPPRAISAL OF A THCRD AGRICLLTURAL CREDIT PROJECT MI0OCCO AN00X 2 Table 13 Caisse Nationale de Crédit ARricorl Conditioan & Non, for Loa--CRCA--Coaditiona et No- ea da Financeent pour Principaux PrOti Zon -- ____I_ ---__---- _--- i---------- --------- 1I--------- .... ----- ----------li7V--------- ----------V---------- Hxiu Inseitmeni CateaRor A Clîceneai N Clitnt- A Clients f Cliente A Clients B Clianc A Clients O Clients A Clients D Client TInn Iemnettenenent Sho-t-team ---------------- ------------- -----------------------l(Dthh or hned DV ha on tûte>--------------------------------------------------------------Court-teere Grain o~n4alré Stoing 350 250 220 150 250 150 250 200 250 150 Culture MCue I hatventinR 100 80 80 60 100 H0 loi 80 B10 80 ii4-10a masuello MNehexical h-aating 40 30 40 30 40 30 - - 40 30 Ré-lo edcan4e Ploting 1,700 1,400 - - - - - - - - Culture Maousl h.rneetoig 100 100 - - - - - - - - Récolrt xmauelix M.echanicl har.ertixg 60 60 - - - - - - - - R-colre 4raunia Pulses Lgou--eunon Plautig 350 200 300 150 300 150 250 200 300 150 Culture Fodder Cul1ret furaura Bernie - - 300 200 250 150 - - 250 150 C-rR Allo1a firrcgatedl 700 500 700 500 700 500 500 400 700 500 Lucorne (irrcgue) Potatoes Poman d trara Lo-al 1,300 1,100 1,300 1,100 1,300 1,100 - - I,300 1,100 herche Iccolo Euport 1,800 1,600 - - 1,800 1,600 1 - 0,800 1,600 Oxpurcercon L .oal 1,300 1,100 1,300 1,100 - - - 1,300 1,100 H r -hIIocole Export 5.000 4,000 - - 5.000 4,000 - - 7,000 5,000 E.poclactio Cltr-n Ag-runn hnlxtenanc. of plantation l,500 600 1,500 600 1,500 600 - - 1,700 1,000 Oxtralicu plantation Loc -1a be 6d00-1,000 500-800 500-800 400-600 400-000 300-600 500-800 500-800 500-800 400-600 Rae luc-r Pure br-ad - - - 100-150 60-100 80-120 80-120 100-150 60-100 ROe- puce inprcroe Lcvan trk ftedinR Âlcnatscc du bhdail Iaporied dalry cocon 250 250 250 250 250 250 250 250 250 250 Cachan laitl&aa race pure Ccoaa-lred dairp coa 200 200 200 200 200 200 200 200 200 200 Cochon laiccarox race orninea hlediun-rercc Oorau-cerne Rai.lad nom 2070 70% 707 70 70% 70 70 70 70 70 Sec oe AddIrlcn-l condition 40 ha 60 ha 50 ha 60 ha 60 ha 80 ha 30 ha 50 ha 60 ho 80 ha Condition nddOi.-cnalle lrcîgaied nor 707 70% 707 70% 70T 70% 70% 7070 70% 700 5 Irrigué norno iddclcoslI condition 20 ha 30 ha 20 ha 30 ho 20 ha 30 ha 20 hn 30 ha 20 ha 30 ho Conditioon addtit.op.lle Pumps 700 700 70% 00 7 707 707 205 70R 70 strel de roucnce Crouupouearlcn nouiprent 70, 70% 70% 70% 700 700 70% 70R 70% 707 M-tIrl.1 de tra-.port Combine harvesters iionnecen batreusea Norm 70 70% 70% 70% 70% 70% - - 70% 707, 5 Nune Addicioxal condition 110 ha 130 ha 130 ha 140 ha 130 ha 180 ha - 130 ha 180 hu Condition additionnelle CinaranR or de-tonino DH 350/ha DH 300/ha LH 350/ho - DH 350/ha DO 300/ha DH 350/ho - DH 350/ha DH 300/ho 6-10 Dtfrithem-nt ouériercaan Irrioscion 70% 70% 70% 70% 70T 70% 70% 70/, 705, 70% 6-10 Iroostica luiidn 2 2O 2 Ccnntructccn2 lana than 1250 a2 LH 60-80/ot DR 60tn2 DH 60/a2 DH 60/e TO 60/t Moine de 150 n Ahbv 10a70. 700 70% 7051 70% Pixa de 150 Abavo 150 Dx n 150/e2) ( Dn LH lSOtm2) toX ûH 150/m2) (oan 0150/m2)1 !iorred dairv ona 70% 707. 70% 70% 70% Vochea 1aliè-r cmpcortIe'n (a 00DH 3,000) (mas @DH 3,000) (e x0@DH 3,000) lo @DH 3,000) i Dan 0H 3,000) Crose-bhad cans DH 800 DR 600 DH 600 DR 500 DH 700 0H 500 DH 600 DH 500 DH 700 DH 700 Vachea lacciaron race crnie Draft animale DH20 2,000/pair oR 2,000/pair OH 2,0î0tpeir DH 2,000/pain DH 2,000pa-r A-craun de trait (.aa DH 4,000) (max DH 4,000) (ea DE 4,000) (ot x û 4,000) (oto DO 4,000) Citro- el-anttitn DnUel DH 2,500/ha LH 2,500/ha DH 2,500/ha DU 2,500S ha DH 2,500tha Plascarior daRrroan Irtatioo) APPRAISAL OF A TIJIRD AGRICULTURAL UREDIT PROJROT MOIROCC0 ANNEX 2 Table 14 Caisse Nationale de Crddit ARrioole Pre-ent & Proposed Intere-t Rates for CNCA LendinR/Taux . VIelr et PrePusea du ProRaree des Prêtr CNCA Rtes Pr-P-ed for Fin--ral Tsa 1977-78 -Presser---- -------- t Rstea Ueed/Taux en Vi-Ta-u ____- __-_- __----x--------- ---- T..x Prproeta pour i 7E er 1977-78- -----Fiead Fhre/Chrea ------- Equivlent te intereRt Rate Equi-lsent te Ixterest Rate Initial Fae/ A-nual Faa Pro Rata Tsanorie Pro Rata Tenis Cos-ieiox Initiale Coxision Equinsient au Taux d'Intréat Eqoiveleet *u TaUr d'Int#rtr A-elle Pro Rata Texporti Pro Rata Teeporis T, Cl per aea pet seerix i Short-tara Ioanes Frets; aouri-rerPet- Fradurtire laces for tersai 27 4% 9.8% ) Peete de prodoction terealse P-aduotire loax- for other trope 2% 4% 13.6% ) Prets de peodaction aortes toitures Liveetook fattnaneg 2% 2% 13.1% ) aixiere 7.65% PFrts d'exb.uths Harver boans 2% 2% 15.7% F ri Weighted -veraga 17 Moyenn pod'r. deÈ oDn ediu_ _d p_g_t._R o.../ pt. 2/..Y.. et Nsi/o yed rx-' er du eneio 2%487 rits a coyen ai ixeg-raae-- TV.o ypras' dotation 2% 4% S. 7 2 Borde de deux a Fues years' d-retixe 2% 4% 7.2% D- du.e de trois ans Fxor peste' dottion 2% 4% 6.5% ) inieo 7.65%. Du-d de qattea cas Five years' dUottion 2% 4% 6.0% 7 dure e nq .e.ns W.eightd a-sRtge 6.5% ) ur pt cdqrdo II. needen..tete/CRCA Presert Rates Used/Taon enVI-sar PFoposxd Rater/Tauo Proposa II sEL Sh-et-ter- lxens % par ..... % par creux Pt a Peodu-tion ea.. for: Fret de peoduntion pour Cerc-in a-d puiser 6.0 6.0 C~rdele et îdgoeîxxr... Coqpreheesi.x ifdustrial trope progra- 8.0 8.0 Culte tt tees Vxgetabies, rite, niteuo ead Cultr F. r ri, linantenk fcttxning 8.5 8.5 et xbo...hx Marketing ns.e for: Prtte.raeres ar erthaxdise por: Cearel. 4.75 4.75 Cétcale. CoteUn 5.5 5.5 Cutur Madiun .ed ieag-ta- rans. to: P Prett à xrye et 1ong-terne eux Coaparatives ced f..r. aseotiion 7.0 8p i et g5op Other botrotwrs 8.5 8.5 Autres hdenfinieitse I/ The vrari in te the equivalent -tai peo rtaa te.epotie are teuaed by thavariatio in bas. doation 1/ Les -nristion. dan- les taon 'qUial.t pro tata tRRpori- .et .a.e.4 pet tan vlreetin dae la âue des pete 2/ Tha vriartin in the aquiotlsat rta pro tar tee.preit are raused by tha ititis1 f55 for 2/ Las vattattres dan- les taon dquivaleît prn rata teuporie sont .c..s..e par 1 pr.lveaet de 1a tn_eiios inittis th g.crttee fond Chetgad ta teoperetivea only if thsy are six yeat- ld; ix the firtt foor y.eas they are thatred 3/ P-yé par tee tooprttCVoS Z p-rtie de leur sin-é annee; pendint leur q.ntra pra-xires aeen's n1lse payent 72 et 7-, it the fifth ye-r 8%. pendnt 1e tiequirox 8%. APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO ANNEX 2 Table 15 Caisse Nationale de Credit Agricole Levels cf Loan Approval and Maximum Loan Amounts in Lending Operations of CLCAs, CRCAs and Heedguarters CLCAs Approving Body Fiscal Revenue of Applicant Maximum Number of Loans Maximum Loan Amount _______ _ _____________________ __________________________________________ to be Approved DH 100 - DH 150 I short-term loan DH 150 Loan Committee consisting of: DH 151 - DE 300 I short-term Ion 100% of fiscal revenue 1. District Coraissioner (= DH 300 for applicant vith 2. CLCA Director fiscal revenue of DE 3M0) 3. Director(s) of CT and/or CMV DH 301 - DH 3,000 short-term loan: 50% of 4. fural Tax Office Controller fiscal revenue 2 short-term lonns; or medium-term loan: 50% of 1 short-term loan plus fiscal revenue multiplied by 2 medium-term loans .-ber f years (= DH 4,000 for applicant with DHI 2,000 fiscal ravanuea te- questiug a four-year lban) Ex-SOCAP clients with 1 short-tem or fiscal revenue of 1 medium-term lean DH 301 - DH 3.000 _ CRCAs Approvisg Body Cla-sification cf Client Maximum Lan ADsounts te be Av roved Zone IS Zone II-/ Zone III-/ Zone IV- Zone V- A. Interna Credit Committee consisting of: Short-term Short-term Short-team Short-tenm Short-term DR 80,000 DHI 60,000 DHI 60,000 DH 60,000 DH 100,000 1 DRCA Director Applicants who are clients , , 2 CRCA Director cf CRCA or Headqoarters for Mediurs-tenm Medium-term Medium-tens Iedium-tenm Medium-term 3 CRCA Deputy Director a minimum period of 2 years No limita Ne limits No limits Ne limite No limite 4. CRCA Head of Lban Section and who have used the loans Maxim.n tota Maximum total Maximum total Maximum teta Maximum total 5. CRCA Heaq1of Recoveries obtained in a good manner debt out- debt eut- debt out- debt eut- debt out- Section - and who have a good repayment standing t ain t standing te standing to standing te record one client: ee client: ee client; one client: one client: DH 200,000 DH 150,000 Dh 150,000 DH 150,000 DH 200,000 General limitation: Decisions taken by the Internal Credit Cormittee and involving loans exceeding DH 3,000 have to be confirmed by the Director DRCA. Decisions involving leans exceding DH 6,000 hava te be confirmed by the Credit Department at Headquarters. B. Credit Comittee 1 CRCA Director All other individual same as same as sams as same as sans as 2. CRCA Head of Loan Sactien applicants sud applications above above above above above 3. Representative of Province from farmers' associations under A. under A. nder A. under A. under A. Authorities 4. Representative cf Ta. Office 5. Representative of DMV 6. 1-3 farmers representa- tives 7. Representatives of other local authorities if neces sary Headg uar ters= Approvina Body Classification of Client Maximum Loan Arseunts te ha Aproved CNCA Management Commtttee All applications from No limita individuals and from 1. CNCA General Manager or farmers associations his representative which are not ruled in 2. Seven representatives the Loan Regulations or of the Ministries of which are exceeding their Agriculture, Finance and noms or limits of indebtedness. Interior and cf the All applications for collective Cm tral Bank lans. 1/ Only if DRCA Director is not participating in Coenittee session or CRCA does net have Deputy Director 2/ Zone : Fes, Meknes, Larache, Kenitra, Rabat, Casablanca and Berrechid, except for 3 mnuntainoes subzones in the Fa9-Mekn>. regions uhin h fall under Zone II Zone II: Nador, Tetovan, Taza, fhenifra, Beni-Mellal, Marrakech, except for 2 subzones in the Taza region which fall under Zone I Zone III Safi, El Jadida, Sidi Bennour, Settat, Khouribga, Fkih ben Salah, ES KaSlâ and Oujda, eac pt for on sub2cne falling under Zone I Zone IV: Ksai-Es-Souk, Ouarzazate Zona vU Agadir AFPPAISAL OF A THI0D AGRICULT11RAL CREDIT PROJECT 163ROCCO ANNEX 2 fable 16 Caisse Nationale1 de CrJdit Agrioole DeoioIe,s,.t of Lesadin Proarso ta I.odividual Fs.r,a 1rslîl-72 - l974/75lle-slao-sont du Fr-noa- des rtaCsTdiiol 1971/72 1972/73 197374 - _1974/75 HQ/CRIA CiTA Totl 3Q4/CORI CILCA Total M1/ CRIA CILlA Total 8Q'CRC OCIA Total fendit ta IsdliIdul Fa-r. rt.sersi.l.r Id~ .1 Short-tara Caura-te- Peeduotien las-. f or ocrais & pulses 23.083 933 24,016 31,252 3,549 34,801 37,855 7,547 45,402 49,256 9,220 58,476 Frets pour frais de -sepagne at.sn etlgsins -rdueties lans for ree rapa socI 550 134 134 193 183 2,181 2,181 Frets pour frais deospagee planteasare Fe_detien leana fer fodder orapa 8 8 406 55 461 612 37 649 467 56 195 Frets pate frais de espa.elstores feurngèree Fradutino assasfer ether ~rp 259 259 Frets pour frais de -spagne autres onltores Hsrvntlng basse 316 364 880 332 lOI 432 15.533 3.192 13.225 5.1118 559 5,677 Frais frais de asiss.. Osbtat.1 24,899 1,3f5 25,404 32,124 3,704 39,628 49,442 10,776 60,718 57,022 9,801 66,827 loostoua1 Peaduetion .ans far toiseron 3,222 3,222 9,007 9,007 13,0599 3 9,178 P > tra do poado~tiio toates Fradoatios Isans fer potsu.es 976 976 1,611 1,611 1,094 3 83 >15,908 1,079 757 >16.820 Prtrs de prodortiao pansa de terre Feadootias bans for athne vegeteblno L3390 2,6390 3,473 _Ž73 1632 5 )S 6256 > ) Fr'trs de prodoortan -1re -a bres ,orsteh&ree Subtots1 6,888 6,888 14,591 14,091 15,825 83 15,988 16,763 57 16,820 os ..tata1 Prodotias bons Cor oitso 7,0165 Y 3,bs35 4,341 5 ,179 5 re ts ds preduotton sgr-a, Psodnutinn 1o1sCo us > 6 >944 7 4.656 350 > 5,5 30 303 P 9 rats de prodoorati liver Peodoatin 1nsso for vineyards 492 S I475 41 I 502 S rtra de prodootton vIgne Frodortine lbans for ther fruits i 777 > _ >__ 167 > 419 S - 551 > _ Pr_tr& ds prodootian antres froitta S.btota1 9,440 6 9,446 4,549 7 4,656 5.525 S 5,530 6,937 50 6,592 Sos.. eral Fo a-utino lassa for -attîr fstmotng 33,0 71 >58254 36118s >2 659 >55 821 38,2 >417 0 50,342 1,78 3,0 Pâtîs d'enba...he bovine Fedoto -bn fer ehsep fattnsing 17,555 > )17,344 5 23,38f1 23,126 ,383 24,509 poflts dlesebasate ovine L.sss fer livaatoek feed 1,020 1,020 1670 1,670 2,000 2,050 4,259 4,259 Pr. alim tent da b2tsil Loess for hbikes breedfng 80 80 146 146 373 373 Frarevattr Lana for baekeeping . 0 - 190 15 ___ 10 433 ___ 433 ____Fsts aptouitora Subota-l 52,745 4a7913 59.464 54.927 2.4359 57.586 64.130 4.107 68_237 783,190 3.141 331,241 ns ..tosa1 Tor1 short-tara linse 93,172 8,038 181,202 105,791 6,370 f12.161 134,922 14,971 149,893 158,422 13,039 171,480 Total prets ut-ea Lsefer Pare boildiaga 10,847 12,066 23,413 13,919 37,409 31,418 12,108 14,193 26,301 13,952 20,334 34,286 Fre.ts osroin Loess for 1ed porhabas 97 97 207 287 188 188 Frets .a......iasC la preprfit. eraie1 L.s.s fer -ro1sh b...s ____ 56 ____ 56 ___ __ 30 ______ 0 Pon ta habitation rurale SO~btorSl 18,843 53,566 23,413 14,072 37,499 51,571 12,515 14,193 26,308 14,170 20,334 34,104 So..setai1 Lases for trantror 17,803 17,803 17,736 17,736 18,050 18,000 17,608 17,608 Fo'tostsoer Lo-n for harates4,351 4,351 1,823 1,823 398 3,998 2,036 2,036 prat osoose sros Lasse Car uree t eqelpa t 4,431 4,431 5,198 9198 4,838 4.838 6,138 6,138 Frets -Y.e.s de transport LassCr isplaneats 1,038 1,0738 1,738 1,738 1,690 1,660 2,103 5,103 Frite gras at.ri1e Lseferetrpsp 3,386 2,551 5,537 3,915 1,479 5,294 6,374 1,746 8,120 10,893 1,757 12,650 Fret setjrisl de poapage Lana. for ath-r eqipanu ___t2 26 _____ ____ Poser Iaoqlpns Sobtatal In0â ?A ,251 ?3,00 35,311 1,479 31,799 ia,899 1,746 36,642 38,778 1,757 40,535 O...stotaî 1,ns for Olveeteak Sreeding 3,115 3,115 6,135 0,549 11,684 12,662 18,119 31,181 12,139 27,054 39,993 Prjtsss1paua.d resta Las fo 1and isoponaiset 1,608B 1,496 3,104 2,549 2,943 5,392 3,039 2,149 5,188 1,789 1,120 2,829 Poste asdfartian do eni La- for unîla & aimr irrigtmios sysate 1,281 4,771 6,052 2,753 12,227 14,980 1,184 11,466 15,150 4,806 0,734 13,540 F2rts Jqsipenn yroio Las for es- plnetîtss. 1,140 29 1,169 1,030 170 1,2f0 -,414 251 1,665 1,079 145 1,224 Fr2te orétatns de plntetians LInn for initial as.tssaea of pleatetione 2,850 2,85f 7,046 2,044 1,211 1,211 Fo.tte entretien do pîsatteiaso Loses for draft ssinie 1,642 10,663 12,305 2,901 7,730 13,631 4,335 15,965 20,300 5,470 11,197 17,069 Polio emmena de irait Laso foc seIl 30isnonS 910 840 212 1,410 1,622 196 1,274 1,470 234 1,511 1,745 Folie petit natérial Lasse for hbioken breedion 3 3 29 29 149 149 Prt te vrn r Laesfr skeeplng 560 560 O O 150 10Fesotaac Lassas ft estabbshanni f fddrr or.Pe 2 2 37 37 7 7 S Priasmion fnarra g~res Lassa for ather porp..e. 938 1.79 214 847 593 90 27.59 964 7.7 2 6804 5 961 7776 Oonstat OShbtetl 9__37_ 1779 __47__7_2)994_0 7,5 964 77252_0 5,6 775 . . Tat-l -edtn & lag --olno 51,147 32,5L36 83.760 62_86033 6890337 141jj67 7.8_62 6345_46 142_445 74,752 73.002 1523,404 T.t.1 poste esyen etln-ert Total lassa ta iedivid-Ibs A96 44434i 33 168.631 75.277 243.928 2O9.3744 80.534 290.318 238.174 86.110 232428434 TaisI pr4ts gia.ac indivIdools APPRAISAL OF A THIRD AGRICttLTURAL CRDIIT PlOJECT OFROCCO AINEX 2 Table 17 Caisse iationale de Credit Agricole t- Development of Lending Progras to Farmers' Associatios. Cooperattvss ,& Copanies 1911 /72Z - 197(4/75I `Developpement du Programe des Preto Collectifs Short-tesm Court-terme Loans tu ORMVAs & SPs for Frets aux ORl4VAs et SPs pouw Comprehensive Industrial Crops Programs 1971/72 1972/73 1973/74 1974/75 Cultures Intégrées Cotton 16,io4 14,051 12,066 25,879 Coton Sugar beet 49,a8o0 53,121lS 51,937?, 147,276 Betterave Sugar cane J» 635 Canne sucre Corn -' - -' 7,230 Mals hybride Sunflower 2 9,J540 Tournesol Cer-la (lSouas Massa) - - - 3,221 Cérésles (Souss Massa) Vegetables (Souss Massa) - - - 9,169 Cultures marafchères (Souse Massa) Subtotal 98,322 100,512 120746 202,950 Soustotal Loans to Cocperatives Peéta aUX Coopératives Agrarian Refusom cooperatives 6,705 19,083 19,195 18,216 Coopératives de la Rgforme Agraire SCAM & CMA (grain marketing) 57,600 47,600 58,889 43,129 SCAM & CMA (conmercialisation céreales) SCARI (rice marketing) 200 800 950 1,760 SCARI (commercialisation riz) COLAITfORD (oilk marketing) - - - 150 COLAINORD (commercialisation lait) Other cooperatives & fassera' ascocist osa _ 9>333 200 9 Autres coopératives et groupements Subtotal 64,505 77,016 79,234 63,264 Soustotal OCi (Citr-us) 300 500 700 1,200 0CE (Agrumes) Lbans lo Companies Preta aux SoCietes SESM(sugar factory Qampaigo) _ 2,000 24000 SESM (compagne susriere) COMAGRI (sugar beet seed) - 16,843 8,000 9,950 COMAGRI (semence betterave) cOMAGRI (corn seed) _- - 3,811 COMAGRI (semence mais) COMAPRA(cotton marketing) - 8,oûO 9,358 10,382 COMAFRA (Commercialisation coton) SOGETA 14,000 22,000 SOGETA SODEP 5,424 4,217 SODEA Other companies -2 1 504 850 7 702 Autres sociéetés Subtotal 2,4 5392 Soustotal otzal Short-term 188,342 206,475 240,312 325,476 Total Court-tesme Ms-GW-n & Lung-ter-m Moyen s-: Long-tes-ne Luans tus- Caupes-attves- & Pas-mers-' Asssocitisa FPrêts CoPeératives et Groupements Agrarian Reform -oaperatives Coopératives de la Réfoume Agraire Fasm buildings 143 1,022 2,983 5,711 Abris Cattle breeding ,o68 4,597 4,940 983 Bovin lhs-ep breedlng )))655 Ovins Gras-tors ) ) 6,033 Tracteurs Ha-vesting equipment ) 1,729 ) 4,805 ) 9,680 3,824 Matériel de récolte Implenents ) ) ) 2,189 Gros matériel Plantations 961 - 1.575 1,120 Plantations Irait animsls 1,47Y 3,295 533 2'17 Animaux de trait Small tmplements 801 1,770 383 155 Petit matériel Subsistonce 1,353 3,958 632 1,215 Subsistence *ther equipment - - - 29 Autre equlpement Agrarian Reform Coaperatives (73,530) (19,447) (20,726) 497459) CpDVoertivea de la Réforme Agraire SCAM-CMA - - 9,560 _ SCAM-CMA SCARI - 120 - SCARI COLAINORD- - 664 COLAINORD Fermes-' assoctions - 891 736 _ Groupements de méeanisation -ther cooperatives & farmers- associations 1,330 598 3 055 1,356 Autres coopératives,pt groupements luitutal ail coperatiVea &, fartera essoc 8,860 20,936 34,197 24,472 Soustotsl cooperatives et groupements Lsans ta ORI7As & SPs 921 2,036 6,o66 9,486 Frets ORMTA et SP Loasns nu Companies 9 Prets Sociétés StDFIR(Cattle breeding) - - 1,200 SOD2 A (nimaux de rente) SOD23(equipment) _ - 840 SODEA lequipement) SlGETA (cattle breeding) - - 9,000 9,000 SOGETA (animaux de rente) SO2ETA (equipmeot - 9,000 9,000 SOGETA Lquipement) COMAGRI(cattl breeding) 78 8 - 3,875 COMAGRI(animaux de sente) COMAGRIbo(busing) - _ 625 COMAGRI (habitation) Other companies 1 083 143 2 287 Autres socie'tés Subtotal rompantes 1,161 1,051 3 27 Soustotal societes Total Medium & Long-term 10,942 24,023 58,456 60,785 Total Momen et Long-teste Grand Total Loai s tl Farmera' Groups, 199,284 230,498 298,768 386,261 Grand Total des Prêts Collectifs Cooperatives & Companies 3/ Figures for cs-s, sugar cs-e and eunflower -ontained in Subtotal. 33 Prete pour la culture du nmais hybride, de Il sanme a sucre et du l/ Ro breakjdown available tuvtiTsgoln o8ntr-cmffeis dans le soustotal. 98340000 OdIttO 2~~~81/8 daiaaaIHdtd iaraiOact 1970 71 - 1974/7 2-aA' roIt. o 1975/76 - ,199/2 -2-- 970/71 -- t -- 971/72…-- ---1972/ 73 --- ---1973/74 ------ 724/75 …- ---1975/76--- --- 1976/17 --- 0---917/16-- ---019378/79 -------1979780 ------ l999/8-1----- ----- 987! 9Sf 0/ HQ/ HQ! 99Q/ HQ! U/ Q! 99/ 00/ CIO CIAToa C CA LCA Total MCOC CIR oa 00 TTotal- COC MA.7 Total COA I TotalCOC CIRA Totl OC CIR To OA CIATtlCOA TR oal79-CCATtlCCA10 oa logtndabt/aqotty 0.60 - 0.32 0.68 - 0.37 0Ht7 - 0.57 0.57 0.39 99.53 0.79 OIt6 0.53 1.199 0.70 1.36 1.19 0.00 0.69 1.17 0.46 790 0.43 0.4i9 1.09 1.77 10H9 1.41 2.13 1.22 1.75 2.77 bAt6 2.23 Satn oOonte.e-aia Carrant acactal - ~~~- 1.41 - 1 .33 - - 1.59 - - .94 - - 1.84 -- - 2.11 - - 0.55 1.22 4.40 1.47 0. 24 3.79 1.40 l1.1 4.01 i.53 1.42 4.30 1.68 1.49 5.05 0.87 Ortitaoo,aoa tot/qlyPl.. lon- -- 0.76 - - 0.73 - .4 - - 0.65 - - 0.65 7.40 0.90 7.60 0.46 /7.6 7.59 0.43 0.69 0.53 0.41 0.9 0.48 0.36 0.52 0.40 0.32 0.45 0.36 0.27 3.49 0.31 Cptloptîrc Eqoiro/aIl Iiahtîitia. - 0.35 - - 0.35…0.36 - -9 0.39 0.26 0.91 0 .41 0.02 0.75 0.14 0. 20 0.59 0.29 0.09 0.49 0. 27 0.00 7.49 0. 25 0.17 0.399 99.23 0.16 0.35 0.20. Toctlpcif tota Fiaanial ohargaa/-4.3 - - 4.5 . - 4. 7 5 .4 4.3 2.0 4.2 3.7 6.99 3.9 3. 4 7.3 3.9 3. 7.0 4.0 3.9 6.0 4.6 4.6 4.0 5.3 5.5 7.5 5.9 lOrt/oor Op-rta a./nfa5.9 - 7.8 - - 8.6 - . 9.0 8.3 10.1 9.7 7.0 00.6 8.4 7.4 l0.2 9.0 7. 3 9.4 7. 9 7.7 10.2 89.4 8.2 72.1 9.1 9.0 12.3 9.9 hrA ttîîaln Frette boa.)!-~~~~ ~~~~~~~~~~~~~1.9 - . 0.0/ - - 0.2 7.1 /2.47 0.6 1.1 72.47 1.3 1.4 71.995 1.9 1.5 /2.07 2.1 4.3 (7.57 1.5 1.0 /4.07 1.3 0.4 73.47 0.5 P-oflo /ra-tn/ Protît (lana)! ~~~~23.09 (43.8> 18.7 28.2 739.87 24.0 4. 3 34. 7/ 6.7 70.77759.5) 71.3/ 3.0 /80.17 2.3 6.7 132.37 5.5 14.7 /29.2/ 11.99 20.2 721.0/ 15.8 22.3 (26.31 17.1 28.8 (33.07 14.3 164.2 75.0 1.1 5.5 739.15 4.2Prft(aal Frotte îlnaa>/-1.~~~- 7 - - 0.5 - - 09.1/ - - 0.2 0.6 /1.99/ 07 1.3 /1.7) 1.0 1.7 /1.77 1.3 1.9 02.35 1.4 5.6 /1.67 1.2 1.2 73.6/ 0.9 99.5 3.0 0.4 Profit prt) ProfI fîec 6. 7 71.8) 3.6 8.7 (1.8) 4.7 0. 9 04.0 1.j3 70.37 79.57 72.27 0.7 75.15 0.4 2.0 7.0 0.0 5.4 72.5/ 2.6 8.6 /2.67 4.3 00.1 73.97 5.2 9.9 75.77 4.89 7.0 70.97 3.9 2. 9 (94/ 1.7 Prfit pcrc ftoftt (ban.. 29.9 799.4/ 24.3 39.3 785(16 4.5 (25.8/ 6.9 I.7 (37.37 1.3 3.2 764.57 2.3 2.2 723.27 5.5 17.2/22.6/ 12.6 2.54(17.97 17.7 299.7 72107 19.2 2,31 724.997 15.4 16.3 733.3/ 11.1 5.8 (28.6/ 4,01 P-ctit/nt7 APPRAISAL 0F A 35HIRD AGRICOLTUDAL COODIT PROJEOT 80801350 AN8EX 2 Table 19 Caisse Nationale1 do Credit Agricole Projncted Cash tloo/lSS-76 - 198l-82/Reaaourcr et Eplota Pr4vlionn..ls 80/CRCA q3,&A Total 80/CCA CLIA Total 80/101A 11.0A Total HQ/C80A CitA Tota 110/1814 CLtA Total 00/11A CICA Total ID/CItA CICA Tota IN01L91 BESIOUIiCDS Grat Orn Iiraia bot - 62,438 62,438 - 3,915 3,9115 - - Dotation do Goatenennt lreot 18RD Lonn 861-MCD 45,924 - 45,924 - - -P - - - - - -- t1 BIRD 861-5M08 troposed 1889 ban- - 5,777 18,303 74,080 10,286 46,614 56,900 11,629 52,971 44,600 832 4,008 4,921 Pr2t BIRD rpop-é Propasad A-b Paod bon.. - - 22,100 - 22,012 50,900 - 50,900 57,200 - 57,200 3.200 - 3,200 --n Prer proposé tonds Ar-br Banqua do Maro b CII 16,825 - 16,975 152,877 - 152,877 69,301' - 69,509 35,952 - 35,952 - - - CDC Increanelo dopooîtB iSODO,00 100 15,101 15,000 III 15,100 15,110 100 15,100 15,000 100 15,lOD 15,00 92 100 15,100(à2/l 15,00 lOI 05,190 ~&/15,09 lDD 1510 I aenato n&d%t 12208279,33 01,15157086L/ 06,98263 ,4841/195, 839l'139, 166 33,05lé38D018-172,157 4Iû,1754' 304,626 207,531 512,157 334,832236,575 571,4D7- 329,569 262,437 642,006 cornr prloclpale erOra ..d ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~pr-ts lsaynn. tare t 'n log-tern Prnrl& Doerst- ayens374,143 12,571 391,214 445,312 26,665 471,922 503,281 30,933 534,214 561,690 33,024 594,219 626,472 34,295 661,467 7D1,812 36,558 738,370 285,651 38,391 824,042 ecarsnsprincipal ainsdrOtso epa5..ent of lean.. to 23,100 - 23,108 - - - - - - - - - - - - - - - - - - .ret.noPprnSoea OnrlnuB orer intl3w 7,516 - 7,516 8,718 - 8,718 9,889 - 9,889 10,971 - 10,971 12,166 - 12,166 15.388 - 13.388 14.608 - 14,608 Recaee dIvrss Additional fonds -eqolmd - - - - - - - - - - - - 120,807 56,247 177,054 147,481 57,46 204,943 203569 55.989 259,558 Reaa dditionnels de . acon Total inf1os oithboo aubBidy 604,590 159,142 263,732 806,770 155.381 962,151 854,504 216,913 1,01 7, 317 934,465 258,252 1,192,712 1,083,303 302,261 500,252 1,212,513 330,695 1,543,208 1,371,392 356,917 1,728,314 Ressoarta. total as sans s.. ntn Gotarmnet suboldy for 11.4 - 5,759 5,759 - 3,138 3,138 - 4,346 4,346 - 4,547 4,547 - 6,917 6,912 - 10,049 10,049 - 15,818 15,818 Soboantionguenaett p-o las CLtAs Total 1nflos 604,590 164,901 769,491 816,270 158,519 965.289 854,504 221,159 17 5,665 934,465 2299 ,076418303 0,78,9,81 ,1,534044,3327 ,7,927.3514432 ReaorcsTosn ODTFIL4J EMPLOIS Dlbesen f onin 4& 16,1 1028000 271,918 2197t1985391.742 249,603 186,763 436,366 278,724 205,433 484,157 350,803 225,988 576,791 384,189 248,577 632,766 4266al.ls11on . mis a~t noYen et loa... 16,1 795 2l97~1,8 2,70 273,445 700,115 long-toSSs o f 414,125 7854190 462,825 27,090 489,915 513,614 28,440 542,054 570,432 29,868 600,300 636,607 31,362 667,969 714,880 32,928 747,808 799,628 34,575 834,203 Renlseionts. praaSDor-en Rban- 42-80 p.8i. IR ,25 - 4,025 4,209 - 4,209 4,401 - 4,401 4,601 - 4,6O1 4,810 - 4,810 5,828 - 5,028 2,602 - 2,602 Depalanant do principal do Pe.t BIRD) ban- . 86-9f .~.i- IR) 4415 - 4,415 7,477 - 7,422 8,029 - 8,829 9,121 - 9,121 9,294 - 9,294 9,980 - 9,981 10,717 - 10,717 Repitesat do printipal du Prt 81R1 Bepayn..nt n principal- - - - - - - - - 2,852 12,198 15,050 2,852 12,188 15,050 2,852 12,198 15,0501 ..-t pi.i. .PtBR p-opo...d I88D I..o pr-poat Rapayoner of pri-incpal- - - - - - - - - - - - - - - - - 10,113 - 10,113 Repais.eo do principal do Prat FR881 pr-p..sd Ar-b Pend l.n. propo.a Rbondo. f l~i. f 4000 - 4,080 4,000 - 4,000 4,010 - 4,000 4,000 - 4,000 4,000 4,000 4,601 - 4,008 4,0800 - 4,080 -Repaisset do prinoipal das obligati.na R..y.tf ~ispl - 5 s - 3 -3 - - - - - - - - -.- . ~.i. d -td ban tr_ ciey 50 Agadîr~ la Bille d'Agdr Lotan- 43-8808 IBRD L. 1291 - 1,291 1,107 1,107 915 - 915 715 - 715 506 -506 288 -288 59 -9 Paismt dîn ttdo PAs 81R9 433-mu Inter-o paynnt ID 5,720 5,720 6 -3 - 9 628 ,87 515 - .5,19 5,02 - 5,022 4,336 - 4,336 3593 , 5 99~ Pî.sant d'intoret do Pret BIRD 861-maR boas 861-MOR, 689683 c,515 9 2 Iiarest payert propo...d - - - 126 398 524 906 3,664 4,570 1,87B 7,980 9,855 2,312 9,908 12,225 2,109 9,020 11,120 1,861 2,959 9,820 Piondtrrtdu Peti BIBI prnpnsJ' Intaras 3 aen rpne 30 - 330 2,8427 2,842 6,090 6,090 7,902 - 7,902 7,998 - 7,598 7,998 - 7,998 tIostd rm eOs AR Aro Oued lo.ng propos Cossienent tors 188D1 .ans 193- - 193-5' 165 522 687 143 580 723 SI 214 264 1 4 5 - - - - - - trois donSgagonet des p-tta BIRD tn_re tiaIrolnrÇr - 328 328 - 328 328 - 328 328 - 328 328 - 328 328 - 328 328 - 528 328 aenn dl inrrrpl ieiaa liber finocial chsrgsa- 10,059 1 10,060 10,526 1,885 02,415 .11,744 2,219 14,463 13,185 3,625 16,808 18,100 6,501 25,601 33,155 11,440 44,595 53,232 14,711 67,943 B$pansaa dinîe Rdtnors Ieroi 22,561 13,005 35,566 29,329 16,382 45,211 32,263 18,414 50,677 55,167 20,663 55,831 40,089 23,385 63,478 43,698 26,253 69,951 48,066 29,519 77,585 D&psnnsd'npoinro Tota Outlon 36,32 13,179769,91 78,89 21639 95,289 834,705 240,908 1,7,6 2,55 268,109 1,192,264 1,83,303 309,678 1,392,981 1,212,513 340,244 1553,257 1371,392 372,735 1,744,132 Dposttu Ber ces tile (31,7229 31,722 57,875 (57,8752 10,749 (19,7491 5,310 (5,310) - - - -- --- -- E-tedntBe Acî-,sulted tesh tire (31,72229 31,722 - 26,153 (26,1532 45,902 (45,902) 51,212 (51,2127 - Dodn usl Ur...ter ot tonds 080A/CICR 31,222 (51,7222> (57,825> 57,875 - (19,7455 19,7409 (5,319) 5,310 - - - - -- -- Tr-cf-r tr~s.reris CNCA/CItA 1/Includiof intereot pey-.ant Maaaa pr-je-t- 3/Includina 98 116,010 raPa1ooet M..sa Pe-Jeet. 2/lpaier-t de 98 116,080 po- Massa iInclus 3/ .. Pnit- jnsrsî d nie thr- osiaba 3/ 1n-ér-t de ratard tin-tr-scieto~.t. Z/I-1adiog DH 1,161,000 disb-ranat ion Massa proiti. 4/ éndliaatin de DH 1,161,000 pou Ma.a.. îus 5/B,slir f-r La- 861-4880. 5/tris résld_eî pr_t BIBI 868-Mou. /Dnrs andspesita, bonds, e-h eduneas tee B3< and C90 and asddliteaI Oueds r-qie-d. 6/Int.Frti su d~pOts,nont nblsîr,avcebnar da BD1 s CDI et su ba..ina edditeî-n-nsla de . nnaet APPRAlHAL OF A THIRD ACRICULTURAL CREDIT PROJECT MIOROCCO Caisse Nationale de Crédit Agrirole Prolîected Consolidated Inco.e Statements/1975-76 - 1981-82/Comptet de Perte, et Profite Consolides Previ ei on..ls ------1975/76------- -------1976/77------ -------1977/78…------ -------978/79------ -------1979/80------ -------1980/81…------ _____1981/82------- Coerntcng lomone HQ/CRCA CLCA Totel HQ/CO CLCA Cotai HQ/CRCA CLCA Total IIQ/CRCA CLCA CotaI HQ/CRCA CLCA Ctota HQ/CRCA CLCA T-tol HQ/CRCA CLCA Cotai RIeves d'Oxploitatioe onîerest onsùort-ter= lance 16,379 2,047 18,426 21 068 3,110 24 178 23,881 3,614 27.4951/26. 5731 3,861 3,434 29 486 4 069 33 5551/32 8691/ 1,584 34,453 36,616f, 4,489 41 il S Ir.trêts cor pre%etourt-terme Interet on edi-er ln 4482 8,324 32,806 395 177 43,72 4949 17267 57 76544912208 70699 57,317-26,415 83,732- 16,297- 30,060 96,357 76,118- 33,57 1968- Intérsr pr oyen-ere Benk aod other interner ond IntSrts tanreires et aot-ee et ,anity interest 7,516 - 7,16 8,718 - - 9,889 10,971 - 10,971 12,166 - 12,166 13,380 - 13,388 14,608 - 14,608 intérêts dee serd Total oper-1 ing intern 48,377 1,371 5,748 61,736 14,980 7t,616 74,268 2û,881 93,149 86,035 26,069 112,104 98,969 30,484 129,4S3 112,554 31,644 144,198 127,342 38,û59 163,401 seral revent dsepenerloî Goveroneet subsidy tn CLCA - 3,138 3 138 - 4_346 4 346 - 4 547 4,347 - ,9I7 6,917 - 10,049 ID,049 - 15,818 15.818 - 14,888 14,888 Sobvenrîoe gouvrenementtle pour les CLCA Cotai 48,377 13,509 61,886 61,736 19,226 80,962 74,268 25,428 99,696 86,035 32,986 119,021 98,969 40,533 139,502 112,554 47,462 160,016 127,342 52,947 189,289 Cotta Ooeesting sExenses COarnea d'OE1aliteeHoe Saltries and trhen e-ployee Appainrennts & antres indsenite9 ppor benefits 17,222 10,748 27,970 22,389 13,539 35,928 29,628 15,218 39,846 26,845 17,077 43,922 30,603 19,330 49,933 33,357 21,696 55,053 36,692 24.395 61,987 la peneonnel otares n 17,079 329 17,399 18,928 2,615 21,543 22,699 6,711 29,417 27,767) 11,931 38,991 34,847 16,737 51,584 47,886 20,788 68,674 66,729 22,998 89,747 1tt4éetn Deprrcistioa gnd -ort nafion 1,05 175 1,180 L,089 229 1,318 1,235 303 1,538 1,548 392 1,940 1,608 407 2,015 1,669 421 2,090 1,705 430 2,135 Dtprécietions tamoeeiseans Prnvteton Por bod deùbs 4,497 - 4,497 3,343 - 3,343 3,043 - 3,043 3,095 - 3,095 3,860 - 3,860 3,355 - 3,355 3,844 - 3,844 Pronisieea poo, trtsee do-tnrses Tr-nsportattonand tra-el 1,206 322 1,528 1,567 406 1,973 1,724 457 2,181 1,879 512 2,391 2,142 580 2,722 2,335 651 2,986 2,568 732 3,300 T.an.p.-t et deplacesent alleoenope 8ubtontractedndooinietrstive 1,722 860 2,582 2,239 1,083 3,322 2,463 1,217 3,680 2,685 1,366 4,051 3,060 1,546 4,606 3,336 1,736 9,072 3,669 1,952 5,621 Trevaoe Conrnire-etservileseeterieora servions, intlodtng rent oeetnrtinnlu ,nd mAnrnEt ei_ oou . d. inttrstve tos 2.411 1075 3_486 3,134 1,354 4,488 3,448 13522 4 970 3,758 1 7D8 5466 4284 1933 6217 4,67D 2,170 6_ 84ûI _5,137 2,440 7577 Frtis di-ers dg gestin Intel 45,133 13,509 58,642 52,689 19,226 71,915 59,240 25,428 84,668 66,8701 32,986 99,856 80,404 40,533 120,937 96,608 47,462 44,070 120,364 S2,947 173,311 Cotai let lapone (as.) for thse ear 3,244 - 3,244 9,047 - 9,47 15,028 - 15,028 19,165 - 19,165 18,565 - 18,565 15,946 - 15,946 6,978 - 6,978 à.néfice îptote/ de lenefoite 1/ Inlodiog interes-t fro- Mo-ea Projett / Y tomprin les interers do projet Psse0 41'l'0AA141 UP L A TOIRD AGRIIUL0UI9L OCRDIT PROJEOT MJROCCO Caisse Natliole de Credit Aericole ANNEX 2 Table 21 Prolected CneoIidldatd Balance. Shaet/1975-76 - l98l-82/Previlota do Bilan Cansolid4 ASBETS HO/CRCA 9j94 Toala HB/COCA CICA Total D0/CRCA CLCA Total BO/CRCA CICA Total 86Q/CRiA 01CA Toatl BB/CRCA CItA Total H0/CRCA dLCA Total ACTIF Carrent Assois Actif-sL Ci.eaiens Cash caP dus fra- basili 2,964 37,785 40,749 44,482 5,925 50.407 53,557 4.151 57,7B8 43,067 5,911 58,978 52,121 10,677 62,758 62,806 2B,386 03,192 99,41B 15,118 114.528 Caisse et banqaea Carrent portion ai ndiu- i37,46B 99,2»3 136,783 170,210 129,162 299,372 205,599 157,480 363,079 265,914 188,563 454,477 288,970 214,122 503,092 326,525 236,886 563,411 374,32B 271,849 645,369 Par. ouat des pr;tIo eny tot lana, gran ts.. brais Bhor-ternl insee go 270,118 7,097 277,207 308,690 10,632 319,322 342,984 11,753 354,657 378,214 12,458 390,672 417,635 13.094 430,729 463,572 13,739 477,311 514,165 14,412 528,577 Prote . ootta,e brais Lea- p_rois.si arMoinepn lnporc.ae dau.btfal deits 8,652 - 8,652 10,658 - 10,658 12,484 - 12,484 14,341 - 14,341 16,657 - 16,657 18,670 - 18,670 20,976 - 20,976 danisas... Lnse ra.stvsbls ithue frets 'anins d'ai an, ans y .cnt 398,918 106,420 585,338 468,242 139,794 608,036 536,019- 169,233 705,252 629,787 201,021 830,808 689,948 22 7 ,216 917,164 771,427 250,625 1,022,6052 867,509 285,461 1,152,920 nets Aoadisit.rset rni-abls 24.482 __.sfl4 32 886 31.910 1iL770 43t68 4.,9722 17.267 57.664 483590 22 208 70.598 57.226 26,415 83S 61 6j21 30J 060 596_276 76.047 -33.570 1- 09 16117 ~ 'rev Tarai carcant na.tt 426,364 1255578,893 544,634 157,489 702,123 629,972 190,651 820,624 721,244 229,140 950,384 799,295 264,268 1,063,563 900,449 3B1,071 1,201,528 1,842,966 334,169 i371 Total stitsf eaat Enaity Beetnt t Coet 967 - 987 967 - 967 967 - 967 967 - 967 967 - 967 967 -967 967 -967 Titres de ateete. a Velsa. d'A.eaI.ition Fiend A ..ets Net 10,782 - 18,782 11,288 - 11,288 22.625 - 22,625 43,578 - 43,578 44,456 - 44,456 45,259 - 45,259 45,017 - 45,817 Iablistiiasi. lista.. liber Asieste Aati.. ~Actifs Deferc-e- chargea, net 3,161 - 3,161 3,089 486 3,575 2,934 989 2,922 2,683 1,111 3,794 3,145 1,023 4,166 3,078 931 4,009 3,011 839 3,850 Charges diffCr~.e L-siccevhl fter flts la 'o e a ...sr,grs 281,177 37,272 238,449 257,820 79,144 336,964 308,206 110,193 418,399 329,095 219,653 458,748 400,606 144,850 545,456 469,715 160,503 620,218 535,308 167,408 782,716 brats tass prision. tar Main. ponisien paar...n... deabtfa1 dsbta 5,768 - 5,768 7,1105 - 7,105 8,322 - 8,222 9,560 - 9,560 11,104 - 11,104 12,446 - 12,446 13,984 - 13,984 danteces Insnoiv-blt aft-i vrais i plas d'ance an pe-r nst 195.409 37.272 232,681 250.715 79.144 3295,859 2 P299841013 410Q077 319,53 129.653 465.188 389,502 144_850 534.352 457.249 160.903 617,752 521.524 167,408 688.732 anis Total aitiens...te 198,570 37,272 235,842 252,804 79,630 333,434 302,818 111,182 414,000 322,218 130,764 452,982 392,647 145,873 538,520 460,347 161,434 621,781 524,335 168,247 692,582 Total1eai..stifs Total -Ansîte 3 8 189.801 826z44 810.693 237.119 1,47,84l12 92~526 38 3 30 3 1,58,216 1.088 007 359.904 1477.91 1,23_7.365 41,O141 1,647,5061,40_7,022 4~62,505 1,869,527 1,613,285 582,396 2.115.681 Total ActIf LIABIIITIES & CAPITAL pUNDS PASSIF. CAPITAIL ET RESiglOt Carrent Iicbilitins DlOtîes C-nt-te.s Deposits 152,354 100 132,454 167,354 200 167,554 182,354 300 182,654 197,304 4,00 197,754 212,354 500 212,854 227,354 600 227,954 242,354 700 243,054 D0'p'.9s Snb. evak s 51,825 . 51,825 704,702 - 204,702 274,011 - 774,011 313,963 - 313,963 313,963 - 313,963 313,963 - 313,963 713,963 - 313,963 Avns hacia Aconanta payable .ed 0réditent diver et charges ,ocrnIdeness55,000 - 55,000 40,000 25,000 65,000 42,000 43,000 05,000 48,000 48,000 96,000 60,000 50,2000 110,000 73,000 57,000 130,000 84,000 53,000 137,000 's psys- Caret taiin of150D vert courate do lenc ItR18 Lana 433-M01 4,209 - 4,209 4,401 - 4,401 4,601 - 4,601 4,810 - 4,810 5,028 - 5,028 2,602 - 2,602 - - - 433-tie Correc.t portion aI 100D Oert courant de leerot R1D ban 861-ni 7,477 - 7,477 8,029 - 8,029 9,121 - 9,121 9,294 - 9,294 9.890 - 9,890 10,717 - 10,717 I1,507 - 11,507 861.90e Carrent portion ni vrt contente de l'anpron' 11RD papoce Il 181 in. . - . - - - - 2,852 12,198 15,050 2,852 12,198 15,050 2,052 12,198 13,030 2,852 12,196 15,050 -Proos Caren poton. prapoaci Part con-tent do 'ere FAItS 9-rb 7an,d ba - - - - - - - - - - - - - - 10,113 - 10,113 10,720 - 10,720 proposé Carrent portion of beeda Part con tent de obligations i-ieud 4,9050 4,000 4,000 - 4,000 4,000 - 4,000 4,9000 - 4,000 4,000 - 4,000 4,000 - 4,080 4,000 -4,000 ésii... Cretportionf.. ofou v-o .ert corats de leeprunt de lu CCty of Agadir 2 - 3 -3 - - - - --- - - - - - - - - Tille dlAg.dir carmaiP potion or aa_ s-t cour nie de le-p-an tro.ditea...ttlt fat Wiedernofbau 244 2_44 tKedil ta.slt tOci Wisdnrsuibcu Totalnttn llabillti-s274,870 100 274,970 428,489 25,200 453,689 516,007 43,300 559,387 5805,273 60,590 640,871 600,007 62,690 670,765 644,601 69,798 714,399 669,390 66,142 735,938 Total1 dettes..cut-en lotolcl b ltanced Fusda 39,920 - 39,920 39,920 - 39,920 39,920 - 39,920 39,920 - 39,920 39,920 - 39,920 39,920 - 39.930 39,920 - 39,920 Fonda Sréo taun r Fonds Gjrés on-eedehts I800 L .. 433-iRl 21,442 - 21,442 17,041 - 17,041 12,440 - 12,440 7,630 - 7,630 2,602 - 2,602 - - Eopant 82R1 433-MOi 08003 an. 861.liTa 88,701 80,701 80,672 - 80,672 71,151 - 71,151 62 ,2 57 - 62,257 52,277 - 52,277 41,560 - 41,560 301,093 - 30,053 fE.p-t 00I0D 861.001 Propoceil 18R0 ban. . -52777 10,303 24,000 16,063 44,017 00,9807 24,640 105,690 130,530 27,820 97,560 120,400 19,968 05,302 105,350 17,116 73,184 90,300 tE.Prot BIRD propoa F-or..ed 9-rab Fond at - . - 22,000 - 22,000 72,900 - 72,900 130,100 - 130,0100 133,300 - 133,300 123,187 - 123,187 112,467 - 112,467 Earr-t 4.0 pr-pons ioadB inand 46,000 - 46,000 42,000 - 42,00 38,000 - 30,(000 34,000 - 34,000 30,000 - 30,000 26,090 - 26,780 22,000 - 22,000 Obîigetioes tei-e Inca ifne C107 c A9edir 3 - 3 - - - . - - .. -- sput 61 d'Agndir laetKd mti for Wiedsrnaîbeo - 16,404 16,404 - 16,404 06,404 1 6,404 16,404 - 16,404 16,404 - 16,404 16,404 - 16,404 16,404 - 16,160 16,160 taprottîlasotfiW~of Adlditinoa1 Oaadsra.qalrad - - - - - - 120,007 56,247 177,054 260,208 113,709 381,997 471,057 160,698 641,555 Foda additonl Total IiabilitîOa 470_936 16,504 487,440 635.899 59.907 695_806 76_9561 ]24961 891,182 879,020 l82692 10617 121,009,803 232,929 1.242.742 116_524 285_293 1 448.817 1,3299809~ 325,104 1,687,993 Total p...if CAFITAI AND3 RESERVE80 CAPITAL ET 0ES11VES CaItal 135,906 163,338 299,244 135,906 167,253 303,159 135,006 167,253 303,159 155,906 167,252 303,159 139,906 167,253 703,159 135,906 167,253 303,159 135,906 167,253 303,159 Cail Fnrets ad - 9,959 9,959 . 9,959 9,959 - 9,959 9,959 - 9,059 9,959 - 9,359 9,959 . 9,959 9,959 - 9,959 9,959 Fosda dc eeni Be..r-l rostre Otrontg...î (bb.étits 9_retatnsd enesgs 26,997 - 26,397 29,041 - 29,041 30,880 - 39.008 53,916 - 93,916 73.001 - 73.081 91,646 . 91,646 107.592 - 107,592ao-stida Set incnsi Ilose.) fnr ye.r 3,244 - 32244 9.047 - 9,0497 15. 2 155 0____ ...j.28 19.162 . 19,165 l85659 ..- 18.565 159469 - 15 946 6 978 ..9..B..gfi.,. 6t -d1'V.rc-ie T os1.pite1 fanda 160,747 173,297 339,044 174,794 177,212 352,006 109,822 177,212 367,034 208,907 177,212 386,199 227,552 177,242 404,764 243,490 177,212 420,710 25,7 775247,68 BsT_ce _pse de G-ad Total 656,683 189,891 826,484 610,693 237,119 1,047,812 956,303 301,023 1,250,216 1,080,007 359,904 l4~47,91l 1,237,365 410,141 1,647,506 1,407,022 462,505 1,869,527 1,613,285 502.396 2, 115,681 Grsand Total APPRAISAL 0F A THIRD AGIIICULTURAL CREDIT PROJIICT Table 22 Caisse Nationle de Cridit Aseicoin Princpal IsiraslOverdua ni Apeil 30, 1976 ooaeared ith Prvsosfor Bad ebraat iAas 3.17 Antérier(sula tIti îa 0arl176prrpotsaPoision ..Pour Créano. Dotese.s 31 set 1975 F..d 6. PL. b~~5/ / asv Ana. 31. 1975 ferL.. .. . a ehih et toast of Antnrieur depuis! Soirtai. O/ ni Deviset 15 Overdue f-rsPeiod af: Amusai Overdue foui Pariod: 1962/63 1963/64 1964/65 1965/66 1966/67 1967/68 1968/69 1969/70 1970/71 1971/72 1972/73 1973/74 1962/63-1973/74 1974/75 Total 1~5-26 iaoths~ 27-36 mutsel -vr 38 -aths Tetal Peerdue D .. irptiio Soustotis aoivo CNCA/Hesdqaastars - 343 il 96 35 313 195 1,881 190 1,492 2,173 5,150 11,779 8,877 20,656 u.s.n.2,623 12.7 0140k Oleas CR0A 464 478 609 343 406 233 345 _599 363 1,Q 00 L.m25 2.483 8.576 12.745 21.,321 1,004 895,407 1_04 342 CRCA Subtots1 466 721 620 439 441 546 540 2,480 553 2,493 3,425 7,633 30,355 21,622 41.977 s.n.n 9,923 23.6 Sou..itlsl Pervers if total 1.1 1.7 1.5 1.0 1.1 1.3 1.3 5.9 1.3 5.9 8.3 18.3 48.5 51.5 100.0 ---57.0 - Pucnaedu total CLCA - - - - - a 36 79 83 138 246 665 1,255 6,505 7,738 nan.a. 7,562-/ 97.5 CLCA Peroput of total - il 0./n UC. LI 41-i 32 L.-. E162 83,2 100,3. o o4 .. 3 n P-urcntuge du ltai. Torai 464 721 620 439 441 554 576 2 ,5959 636 2,631 3,671 8,298 21,610 28,125 49,735 s a. u.. 17,485 35.2 Total Parien.t 0.9 1. 5 1.2 0.9 0.9 1.1 1.2 5.1 1.3 5.3 7.4 16.7 43.5 56.5 106.0 ---188.0 -Pîrulg Bad Debta by Catsgary ooipnred aith eAu..,. tvrua Auguat 31 uf 1973, 1974 sud 1971 Cr .u... Doutnases ep- rappeurt 1 'fAtri.rieora 31 a.. t .1973. 1974 et 1975 (PH 1000> - fîpounîn Reonivable aI foasai 31, 1973 as si -i7h---ta-ee-a--a-us--3-194 nah --Atina eeivble ut Ausoat 31 195assbi- selut 1- asen Pavy-at is oveedue fer: t a lesi Ose Partout te Ovedae for -aletOsPviet ta Ovrdaefr d s/d/ AIe d/ e! f 0-7 8-14 15-26 27-38 oves 38 Total Totul Pro- 0-7 8-14 15-26 27-38 oves 38 Total Total Pro- 0-7 8-14 15-26 27-38 oves 38 Totsi Total Tri- Moutha Montha Mlnths I-toha Hoatha Oerdue Psu- vison Iouho Honths Hosthe Hosthe Menths v-d-s Pr- vsesMuntht Mosthu Months Morths Mnstho Overdie Pro- oletor Ï/ ~ ~ ~ ~ ~ ~ ~ ~ ~ vsasOverdie 3/ viafou Ovnsdue 3/ ____tiîuu.. Oveedue HQ individuol lu-u - 53 438 18 499 -740 7,195 35 - 21 306 7,577 330 4.4 3,784 97 50 -86 4, 117- 230 5.6 H0 prtél lndivld.ael Ho gt-p asa. 7_22 - - 2.065 - 2336f 44.112 6 549 - __ 2.071 _4 3&' 234 - 4487 _ 648 - 2.071 _47,566/ 2.394 3.0 H10 pris plief HQ torol 4, 572-4 775 438 18 2,564 8,367-/ 3,100 37.1 31,307 61 549 21 2,377 54,315a'f 2,675 4.9 48,631 97 698 - 2,257 51,683 2,623 5.1 HQ talai COCA loues 13.451 5 426 3,162 1.041 3.818 26u.896 6,994 26.0 32,988 2,14.1 3.242 2n,056 1,4956 48,403 7,193 14.9 47~,1,47 - 2 00994 1.185 5,407 55 738 7.308 15.1 Prttn 0RCk Ossad tatsi 18.023 6.199 3.600 I 059 6 383 35,263 10 094 28.6 84.295 7.222 3.791 2.077 5.333 102.718 9.868 9.6 95J768 97 2.707 1.14.4 72664i j17,421 9.923 9.2- Grand entai a/ Fusdn de aruntiu el Provisions poi CrÉasiaa -oluaaa 31 ..eat 1975 pou d-s p.tîs ayant su seins use .'hje iapsya'e depuis: 15-26 soin, 27-38 suis, po plus de 38 ails 6/ P_u.iautaga de l'Antcrieos c/Cr a..ea a ysut su moira Use lihéaai Iupsyo depuis: 0-7 sols, 8-14 sua., 15-26 meus, 27-38 amie, plse de 38 unie. d/Tîsa1 de l'Atériaup Total d-a Pnîviniies 1/ mee asoele ro e-rdao for paside ai 5-16 methe osiy su hat rIe probability if r-ovry iu 8realts thas for th. aides debts. ./.Ce isontan ont ana antesiorîted 5 a. 16 eus et la probaîlliet' de 1-a seovrrst do- plus graada 2/ Cassantes Pund et CLCA 2/ Perde do Cassette des CLCAu 3/Ca1oolatsd as th.dffseo bestces total aieet ev-rdue.a pe- anual esposi sud th. as f th. bad debre 3 Caleali vien diff4sen-eente. le tota1 de 1 selerldiqe' dans la Pappert ensel or la .- deserane troi 8=ntnha .-srds. doute..a. da 8 sels et plis. 4/ B_eaide, lie indîvidas1 aed graep dabts net evailable 4 Pao de veulilalipu antre prise iedividos serpritîeuî11atifs N/Plt rsklng inro DRsdeolo 1 Qi946,967 psopsld 1-550 51/ Nt ...a., pas cunpts -ns caatsata sul-pis de Di! 9cu,946t6 6/Net tokln8 inte eonsiderstios lH 11,212 psapsid la.as.6 Ne ti..nat pas -vpte dea rapalisnts astîvipto de D1 11,212 7/ Nut taking inte iuadesoeion D1H 11,726,559 prepaid line7 No tenan.t p.s compte des rapaie....ts atioipés de DHI 11,726,559 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT ANNEX 2 Table 23 MOROCCO Caisse Nationale de Crédit Agricole Equity Investments at Cost Price/ Titres de Participations à leur Valeur d'Acquisition (DH) Number Description Unit Price Total Price Nombre Nature Prix Unitaire Prix Total 5 Obligation Maroc 4.5% 10 50 1929/32 5 Obligation Maroc 5% 10 50 1933/34 25 Obligation Maroc 5% 1,000 25,000 1931 61 Chemin de Fer Tanger-Fez 5% 5 305 4 Chemin de Fer Tanger-Fez 5.5% 5 20 Comptoir Artisanal 2,000 COMAPRA 1,100 Société Charbonnage 1,000 125,000 Nord Africaine 1951 5% 7,272 Société Charbonnage 51,311 Nord Africaine 3,113 Sucrerie Nationale du BEHT 100 311,300 Société Nationale de 100,000 Développement de l'Elevage SOGETA 300,000 SONACOS 50,000 Cautionnement 1,252 Total 967,388 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Caisse Nationale de Crédit Agricole Farmers Reached by CNCA as of January 1, 1977 Individual Farmers Estimated Number Of Which % of Farmers Receiving ___________________ _______________ Credit Fiscal Income: Less than DIH 100 852,100 - 0 CLCAs: DH 100 to DH 300 323,600 5,810 1.8 ) DH 300 to DH 800 299,400 30,370 10.1 )154 DH 800 to DH 1,400 231,500 52,630 22.7 DH 1,400 to DH 3,000 168,700 68,260 40.5 ) CRCAs: Above DH 3,000 90,000 52,200 58.0 Subtotal 1,965,300 209,270 10.6 Farmers Reached through Organizations Comprehensive Industrial Cropsl1 96,000 Program (short-term) Cooperatives 16,000 Farmers associations - 2,000 _ Total 1,965,300 323,270 16.4 Farmers with a Fiscal Income Above DH 100 1,113,200 323,270 29.0% 1/ of which 4% borrow medium-term ANNEX 2 Table 25 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Caisse Nationale de Crédit Agricole Equivalent Interest Rate Pro Rata Temporis For Medium-term CLCA Loans Parameters Initial fee a Annual fee i Recovery rate as of October 1 of each year r Term of the loan (years) n Number of months between disbursement date and first due date (in fraction of a year) p Equivalent interest rate pro rata temporis t Formula 2a + i(n - 2r + 3) + i2 (1 - r) (1 + n) t = p + (n + p - 1) (1 - 2a) ANNEX 3 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Caisse Nationale de Credit Agricole Performance Under the Previous Agricultural Credit Projects 1. Project Data - First Agricultural Credit Project Loan Number 433-MOR Loan Amount US$10 million Loan Terms 16 years including 4 years grace at 5.5% Project Cost US$26 million Foreign Exchange Cost US$10 million Date of Signing 11/08/65 Date of Effectiveness 02/17/66 Closing Date (original) 03/31/69 Date of Last Disbursement 9/69 2. Project Data - Second Agricultural Credit Project Loan Number 861-MOR Credit Number 338-MOR Credit Amount US$10.0 million Loan Amount US$24.0 million Loan Terms 15 years including 4 years of grace at 7-1/4% p.a. Project Cost US$69.7 million Foreign Exchange Cost US$34.0 million Date of Signing 10/12/72 Date of Effectiveness 2/02/73 Closing Date (original) 8/31/76 Date of Last Disbursement 5/28/76 3. The completion report of the Second Agricultural Credit Project is being circulated and reviewed separately. A summary of the completion report appears in the main text (paras 4.03-4.09). ANNEX 4 Page 1 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Representative Farm Models A. Assumptions and Model Descriptions Assumptions 1. The purpose of the preparation and analysis of representative farm models is to illustrate the impact that the Project is expected to have on its beneficiaries. The models estimate the income received by farmers at the present time, project the changes in income likely to occur as a result of Project investments, quantify the benefits that will result from the Project and demonstrate the financial incentive to farmers to invest under the Project. 2. The large number of beneficiaries and wide range of conditions under which they operate have necessitated a number of simplifications in the prepara- tion and analysis of farm models: (i) Only the major crops grown have been included in the models; (ii) Standard input and product prices have been used, although some variation occurs in practice as a result of locational factors; (iii) Farmers have been assumed to have no long-term indebtedness at the present time; although such an assumption is probably not correct, it does not affect the estimate of incremental benefits from the Project; (iv) Family labor has not been costed and family consumption has not been included as income, but both have been quanti- fied separately. The Models 3. Model 1: Well Drilling and Pump. This is a small 6 ha farm in a rainfed area. The farmer grows hard wheat, barley and maize in an area whose average rainfall is around 320 mm (e.g., Safi or Essaouira). Yields are low. The farmer also owns a cow (providing milk for family consumption) and 50 sheep, grazing on collective lands and fed with straw in the winter and during dry periods. The investment (well and pump) would allow the farmer to grow potatoes on part of the land devoted to maize. The investment is authorized by the Technical Services of the Ministry of Agriculture to prevent overpumping. In case of a dry well the farmer must repay the loan, unless he took a special insurance coverage. As a second stage, the farmer may introduce early vegetables once his cultivation methods have improved. The farmer is a CLCA client (Part A of the Project). ANNEX 4 Page 2 4. Model 2: Two Draft Animals and Basic Agricultural Implements. This is a small 8 ha farm in the grain-producing zone of Morocco (e.g., Berrechid) with no possibility of irrigation. One fourth of the surface is left fallow and grain (hard wheat, barley and maize) is grown - the rest; the farmer rents plow, harrow and draft animals for land preparation. The farmer also owns four cows (milk is sold at springtime when production exceeds the family consumption) and 80 sheep (young male sheep are sold). They are fed on fallow and on collective land, with the resulting risk of feed limitation. The investment (2 mules, a plow and a harrow) allows for all the land to be cultivated. The resulting availability of straw and stubbles will help eliminate the feeding risk by allowing the building of feed reserves. The farmer may be a CLCA borrower or a member of a newly- created Agrarian Reform Cooperative (Part A or D of the Project). Both assumptions will be tested in the cash flow analysis. 5. Model 3: Two In-Calf Heifers and a Stable. This is a small 13 ha rainfed grain farm (e.g., near Oued-Zem). Grain (hard wheat, barley and maize) are grown with low yields due to poor climatic conditions (425 mm) and lack of fertilizers. Land is prepared by the farmer with his own draft animals and implements. Except for the two mules there is no livestock. The investment (two crossbred in-calf heifers and construction of a stable for the two cows and their calves) will also result in cultivation of one ha of vetch oats which will receive adequate rain (barley is used to supplement vetch oats). Enough feed will be available for the crossbred cattle. The farmer is a CLCA client or a member of a 6-year old Agrarian Reform Cooperative (Part A or D of the Project). Both assumptions will be tested in the cash flow analysis. 6. Model 4: Four In-Calf Heifers and a Stable. This is a medium 66 ha rainfed farm (e.g., in the Tadla). Hard wheat, barley and small broad beans are the main crops; sugar beet (under a comprehensive crop program) and bersim are grown on irrigated land. The farmer owns a tractor and rents a combine harvester; he initially owns two cows. The investment (four in-calf Frisian heifers and a stable) allows for an increase of the herd. At Year Il the herd would number 29 cows and heifers and 18 calves. Male calves will be sold when one-year old, female calves will increase the herd and old cows will be sold after the sixth calving. Artificial insemination will be pro- vided free of charge by the livestock technicians of the Ministry of Agri- culture. Twelve hectares will be irrigated, half sugar beet, half bersim, with a second crop of maize forage on 3 ha. Forage produced by the farm cover the needs of the herd until Year 10. The farmer is a CRCA client (Part B of the Project) but also borrows from the ORMVA (or the SP) for his short- term needs for sugar beet (comprehensive crop program). 7. Model 5: Combine Harvester. This is a large 120 ha rainfed farm growing grain and pulses (e.g., near Settat). Land preparation and transport are done by tractor, but harvest is done by hand, necessitating a great number of seasonal workers which are not always available. The investment (combine harvester) will eliminate the problem of seasonal labor recruitment; it will also reduce harvest losses and thus improve yields by one quint:al per hectare. Once the harvest is completed on the farm, harvest custom work will be done on other farms, thus supplementing the farm's income. The farmer is a CRCA client (Part B of the Project). ANNEX 4 Page 3 8. Model 6: Tractor and Land Preparation Equipment. This is a medium 60 ha rainfed farm in an area where average rainfall is 350 mm per year, e.g., near Oued-Zem. The farmer grows wheat and peas in a two-year crop rotation; land preparation is done with five pairs of mules. The investment (a wheel tractor, a 3-disk plow and an offset disk) will allow better land preparation. An improved variety of wheat will be grown, fertilizers and herbicides will be used, resulting in better yields with the same cropping pattern, while they would have been much less efficient if the land had not been prepared with a tractor. The tractor is also used for custom work on other farms, thus supplementing the farm's income. The farmer is a CRCA client (Part B of the Project). 9. Model 7: Plantation and Maintenance of Citrus Orchard. This is a medium 25 ha irrigated farm in the Tadla plain. In addition to 4 ha of citrus, the farmer grows soft wheat, small broad beans, alfalfa (sold outside) and sugar beet (under a comprehensive crop program). Some of the land is left fallow. He owns a tractor and rents a combine harvester. Yields are good. The investment (citrus plantation ) will allow the farmer to increase citrus production from 4 to 10 ha by eliminating the area left fallow. He will double his alfalfa acreage (2 ha to 4 ha) to be able to trade alfalfa against manure with livestock breeders, using the manure for the citrus trees. Full production will be reached after 12 years. The farmer is a CRCA client (Part B of the Project). 10. Model 8: Well Drilling and Pump. This is a small 4 ha rainfed farm near Casablanca. The farmer grows hard wheat and chick peas with aver- age yields. He has been a CLCA client. He also works part-time in a neigh- boring, large early vegetable production farm. The investment (well drilling and purchase of a pump), authorized by the Technical Services of the Ministry of Agriculture, will allow the farmer to switch from rainfed crops to early vegetable production, partially for export and partially for the Casablanca market. In case of a dry well, the farmer must repay the loan, unless he took a special insurance coverage. A three-year cropping pattern will allow a 150% cropping intensity, wheat and forage crops being associated with early tomato and potato production. In the first stage, forage production will be sold to other farmers; in a second stage, the farmer would buy for himself some dairy cattle. The farmer will become a CRCA client (Part B of the Project). 11. The resource base of the eight models is presented in the tables annexed and summarized below (with-project data): Farm Models 1 2 3 4 5 6 7 8 Farm size (ha) 6 8 13 66 120 60 25 4 Cultivated area (ha) 6 8 13 69/1 120 60 25 6/1 of which irrigated (ha) 0.75 - - 15 - - 25 5 Livestock (heads) Cattle (cows) 1 4 2 18 - - - - Sheep 50 80 - - - - - - Mules - - 2 - - - - - /1 double cropping. ANNEX 4 Page 4 B. Financial and Economic Results Income 12. The net farm income with and without the Project is projected to develop as follows: … Income (DH) ---- --Incremental Income-- Model Without With (Year 10) DH % 1 2,204 4,079 1,875 85 2 4,146 4,654/1 508 12 3 2,299 4,231 1,9:32 84 4 17,400 39,763 22,363 129 5 55,039 82,384 27,345 50 6 23,734 40,078 16,344 69 7 30,740 50,713/2 19,973 65 8 777 14,079 13,302 1,712 /1 Year 6. /2 Years 12-25. In the first three models, there is some family consumption of farm output. When it is included as part of the income, the net farm income would become: Total Net Farm Income Including Family Consumption Cash Income as % of ----Income DH---- Investment Income Total Net Farm Income Model Without With DH % Without With 1 5,345 7,220 1,875 35 41 56 2 5,806 6,314 508 9 71 74 3 2,299 4,879 2,580 112 100 87 13. On the basis of an average family of 6.5 persons, the per capita income from the farm and on-farm family labor would be as follows: Model Per Capita Income (US$) Without With Incremental 1 191 258 67 2 208 226 18 3 82 174 92 4 623 1,423 800 5 1,969 2,947 978 6 849 1,434 585 7 1,100 1,814 714 8 28 504 476 ANNEX 4 Page 5 For purposes of comparison, per capita GNP in Morocco in 1975 prices is esti- mated at US$470 in 1975 and is forecast to increase to US$520 in 1980 and about US$560 in 1985. A number of observations can be made on the basis of the analysis presented in the tables attached to this Annex. The more interesting or salient points are briefly discussed in the following paragraph. 14. Fiscal Income. The fiscal income of the farms is as follows: Model Fiscal Income (DH) Without With % Increment 1 1,400 1,600 14 2 2,250 2,400 7 3 1,640 1,940 18 4 5,700 9,380 65 5 8,400 8,400 - 6 3,000 4,200 40 7 9,000 13,000 44 8 240 3,500 1,358 It clearly bears little relation to the actual net income. Fiscal Income as Percentage of Net Farm Income Model Without…------------------------With l 26 22 2 39 38 3 71 40 4 33 24 5 15 10 6 13 10 7 29 26 8 31 25 15. Farm Size. The farm income per cultivated ha is as follows: Farm Income per Ha (DH) Model Without With % Increment 1 891 1,203 35 2 968 789 -18 3 192 375 95 4 264 576 118 5 459 687 50 6 396 668 69 7 1,618 2,029 25 8 194 2,347 1,110 ANNEX 4 Page 6 The large farms (Models 4, 5 and 6) are clearly less intensive than smaller farms (Models 1, 2) and especially less intensive than irrigated farms (Models 7 and 8 post project). The correlation between farm size and income is low for farms where most of the income is derived from livestock. Part of Income Derived from Livestock /1 Model Without…---------------------------With 1 74 46 2 74 68 3 - 47 4 4 32 5 to 8 /1 Including family consumption. The decrease in farm income per ha in the case of Model 2 is due not only to a decrease in relative intensity with the cultivation of fallow land but also to the relative importance of the income from livestock. 16. Return to Labor. Family labor has not been costed. Only the smaller farms use family labor. The large grain farms (Models 4 and 5) are not family farms but are run by absentee landlords under a tenancy or share- cropping system. Days of Family Labor/Year Model Without With % Increase l 543 567 4 2 86 128 49 3 120 300 150 4-5 - - _ 6 720 570 -21 7 441 564 28 8 42 300 614 The family labor requirements would increase in all cases but Model 6 (tractor purchase). The return to labor (farm income per day of family labor) would therefore be: ANNEX 4 Page 7 Return to Labor (DH) Model Without With 1 9.84 12.73 2 67.51 49.33 3 19.16 16.26 4-5 n.a. n.a. 6 32.96 70.31 7 69.71 89.92 8 18.50 46.93 This compares with a standard salary of DH 6.5/day. The farms would there- fore be profitable even if family labor was costed. 17. Permanent Labor and Seasonal Labor. The hired labor needed by the farmer would be as follows: Hired Labor -------Without ------- ---------With---------- Model Permanent Seasonal Permanent Seasonal Workers Days Workers Days 1 - 60 109 2 - 102 60 3 - - _ 130 4 3 855 5 1,134 5 4 1,410 4 360 6 5 - 1 7 3 - 5 8 - - 582 Model 5 (combine harvester) shows the seasonality of labor requirements (see Appendix 1.1). C. Investment Financing 18. Farm investments will be financed in the following manner: ANNEX 4 Page 8 Percentage of Total Cost Farmers' Contribution Government Subsidy CNCA Loan 1 40 - 60 2A 31.5 21.5 47 2B - 21.5 78.5 3A 40 - 60 3B 30 - 70 4 30 - 70 5 30 - 70 6 30 - 70 7 30 - 70 8 30 - 70 1, 2A and 3A are CLCA clients; 2B and 3B are cooperative members; all others are CRCA clients. Subsidies are paid at the time of the investment onLy in the case of Model 2. 19. CNCA loans to finance these investments will be as follows: Model Loan Amount Total Term of which Grace Interest (DH) Period Rate -----------Years…----------- ---…---- 1 3,996 5 - 7.65 2A mules 756 3 - 7.65 small equipment 283.5 2 - 7.65 2B 1,732.5 2 - 7.0 3A 4,095 5 - 7.65 3B heifers 2,572.5 5 - 8.5 stable 2,205 8 - 8.5 4 heifers 11,760 5 - 8.5 stable 14,700 8 - 8.5 5 102,900 5 - 8.5 6 44,570 5 - 8.5 7 49,325 10 5 8.5 8 well 12,495 6 1 8.5 pump 27,195 5 - 8.5 20. Short-term loans by CNCA would be as follows: ANNEX 4 Page 9 Model Loan Amount Average Interest Rates (DH) (%) Without With Without With 1 1,900 2,312 9.0 7.65 2A 1,900 2,000 9.0 7.65 2B 1,900 2,000 6.0 6.0 3A 4,000 4,250 9.0 7.65 3B 4,000 4,250 6.0 6.0 4 29,950 31,650 6.5 6.5 5 51,000 51,000 6.0 6.0 6 24,000 24,000 6.0 6.0 7 20,150 25,500 7.5 8.0 8 1,600 8,200 6.0 8.0 These rates are average for the various short-term loans that the farmer may receive. The short-term loans are assumed to be outstanding 8 months on the average. Financial Rates of Return 21. The financial rates of return on the farm model investments are as follows: Model Rate of Return Model 1 18.2% Model 2A 22.2% Model 2B 20.5% Model 3A 24.3% Model 3B 23.5% Model 4 25.5% Model 5 17.6% Model 6 18.4% Model 7 14.4% Model 8 14.2% APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 1: Well Drilling & Purchase of Pump on a Rainfed Cereal Farm Technical Coefficients/Coefficients Techniques Without Project/Sans Projet --With Project/Avec Projet-------------- Fiscal Income DH 1,400 DH 1,600 Revenu Fiscal Cropping Ha Yield Ha Yield Cultures Durum wheat - 2 6.5Q/ha 2 6.5Q/ha Blé dur -/ Barley 2/ 2 7.OQ/ha 2 7.OQ/ha Orge 31 Maize 4/ 2 5.5Q/ha 1.25 5.5Q/ha Mais Irrigated potatoes - - 0.75 l00.OQ/ha Year 4 (Annee 4) Po¨mes de terre - Total 6 6.00 Total Livestock No. No. Elevage Cow, local breed 1 1 Vache de race locale 6 Calf -/ 1 every 2 years 1 every 2 years Veau 6/ Sheep 7- 50 50 Moutons ----Main d'Oeuvre---- Working Days Family Labor Hired Labor Total Familiale Salariee Total Journees de travail 8/ / ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~8/ Grain 9/ 126 60 186 110 52 162 Cereales 9/ Potatoes 1/ - - - 40 57 97 Pommes de terre Livestock: cow 11/ 52 - 52 52 - 52 Rétail: vache 11/ sheep - 365 - 365 365 - 365 moutons - Total 543 60 603 567 109 676 Total Investment Cost/Coût d'Investissement (OH) Investment Items Cost per Unit Local Foreign Exchange Total % Foreign Exchange Investissements Coût Unitaire Devises S Devises Well drilling 30m at DH 100/m 2,550 450 3,000 15% Creusement puits Pump 3,200 1.500 1.700 3.200 53% Motopoemp Subtetal 4,050 2,150 5,200 34; SubtGtal Physic l Contiagn ici.. 330 130 460 Imprevu. -/ Total 4,380 2,280 6,660 34% Total 1/ 5% of well drilling plus 5% of total 1/ 5% du creusement puits plus 5% du total a x A PlHt 4.1A] Liju~A: RF/t/1T PROJC3T Sans Projet Wlith Prrc. cetAvec Pro et /cca h 2 t '35u Revenu fl-o saSst BigR1 ai, 819 3. 819 do 8î) big mi Bigl/'Du2 Bar/ay 9/ 60 560 5/cC 560 Sci0 5/ct 560 560 560 Og laice 495 309 309 309 309 309 309 '09g 309 309 Mi Potstes - 3,375 3,825 -.1/75 4 500 4,500 4,500 4,500 4,.500 4,500 P oaeald terr Mil/k -243 2ohs P43 243 2143 243 2'3 24, _243 -243 Lais 1 ~ ~ ~ ~ ~ - - --- - - - - Vache eore .if ~~~~~~500 -500 - 500 - 00 - - 500I Vea h.T 7.500D 2,000 2,000 2,000 2, 000 2,000 2,000 2,000 2,000 2,000 Mouos 3 Sheep Tue Paaily Tuneumpslu 2,500 2,500 2.500 2,500 2.5O0 2,,500 2,500 23240 283500 2.300 Muotuc... and Total 7,117 q,8ô6 10,756 10,7o6 - 11,431 /0,931 11,431 /0.931 10,951 11,431 Petai Epe-.. C-~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~uta de Productîoc S.Id. Y ' i-, ~1 266 1,o48 î,o48 1,4 1,048 ij41o4b 1.o48 104 1, 048 iî4 ,o48 Seceucea 21/ t / 21 / Fa,tili .. & 12 675 675 675 675 675 67, 675 675 Engoula et Peeti-,deea 8 fetLisePra &ti Pes/c30dea300 900 300 300 300 300 300 300 30 à.po-tc doOil 13' Hiesd labos fer, Grain 600 50 520 520 520 520) 500 500 500 520 Maiel d'oevr cle4ecPslO Eied Iaber fer Peete..s /3375 375 375 75 35 35 55 375 375 Man0toiesaais poa d _ert Feea D/ie3y Ton î60 160 160 16o î6o î6o /60 160 160 î6o loualoVcenne8s Irrigtion T PoItue -.' 450 450 ,,5022 45,,,02 4323 450 450 40 45IriaondsPsesevre / RS.to/tal 1, 326 ,. 3,5î9 3.523 ,5,23 3,508 3.524~ , 3,528 3,508 Rsl/ Mil ~~~ ~ ~~~~1t3 183 Iî3 183 183 1/3 183 185~ 183 183 L.it 3 M_11k,..c 45 8 458 45 8 453 48 458 450 ,, 458 4 55 Br4lce22 2/hee7 2. 500 2,500 2,500 25004 2,500 2.500 L59 2.500 <32320 2,500Moco17 outtîmni ~~~~3,iht s,141 3,14i 3,141I 3,i4i 3.141 3.il 141 t .141 jl 3.141 Otoîo csogeen18' 446 667 667j 667 667 v/q 67 667 667 6v7 Tmrvts1/ Total 4,913 7,35- 7,336 7, 33 7,33v 7.336 7,~33 7,336 7,`% 7.3/ ouTtal la/c len- bsfers laces ,2ooh 2,470 3.420 3,370 .2095 3,5a5 4,095 .,59î 5.595 o,cRevenu Se/c san/c 2,pôta T-oc O 15 14 le 16 16 16 16 16 16 Tapo,ta Ras in-mce 2X4 _54 3_404 3_354 4,3079 3.57 4,02fr 3.579 3.523 32,092 £XRR,l.i.Ne D-Sri sa/ces/ at 99 6 i.led 6.213/ct.. nseds20 kg,ha il 014 dur ia R 63sQ; Rondejant 6. 59,6e; 1eecc 20 t,g /co B/ aley se 21T 40/' 'ieli -0 ha; ...dl120 ho lha Orge 'a DR 40/Q; Rondenet 76/ha; Se-ece 120 6g/ha 3/ Our ut Dh 425 9, yie O APO-.. 3/2 k7/a Îie h DH 40,Q; Reedeceet is5otha.;O no 20 kg//ca '/Potseosa a/ DR 60 t. ,. I109 bu et peck pvedo/ciee Rn /c4s 4t4 ysar- Sm the -eantie yinld oT 75Q 7 Pocaes de terre 8 O 6043/.d.ItIO/. l- 14d 5 the Tiret vec , 59 tEe cenod yesr, 95Q3 tha thîr,d y-s; ... da 129/ha rnI 5q1 Rondeseet la9/O rcpe-eprdetm u4a5eetOedottt,ovelar d 5 Sma nous Daiy production for fs0ily neesilp/cie. lu che spr,inei.Ia, th. surplus is .eId, 110 lierslt1-r8e 5 V-u O P /tek,t 956 1.t teon p e- de Oeevr 554/Ru.II .pit.. ,l It-, ai'DR 0,82/1 or, 20 120. Milk prdcin2 i e 272 daps e 0.92 = I/R 486. Aftsr /c4s 6/ch caleimg the D0 080,/s-It D3 1200 Pcducti~.e du le 31 1 c 277 joc, .0- O R~ D '.8v. Ape,s I/ , 1aea la onh u rfré t nul1 sua e ueid br rh tcice se 6s/ke or, DU 1,800 3302 kg). S.ihe lars yao ho heife., kenpv ccscotdeh ,ou.,cl D 00,64, v/f u-t. O 1,200 t3100 kË~. E/cru - epocd parla géie a, 4/a -elge gu ét, 4/ch nalioig--..ee nae/ceg -ney ras pyara; dalsy pendons/cen is dioidrd ht-Icee th. teeo year.-ncevn.Ovl tua ou 2 aunt le prodo titn 1 ut'ièe ont repermi par nitli -,çeu200 '3 tai. DfIe cale -ey P yssrs. laid fer fsteiog st h nothas for 2H 500. T/h. ns/f fro th. 4eh calvieg Jn o S ,Utve tueIon 2 -ec. Vomit, p-,t L e/clout DH31 n1 500. Lt tom du 4, veaec"tett pi acer espe/ca ou r-pl.es ths c-11 n- loch '3/lsd ut 52 hsads, Ioin8. ne gras/csf laA and pses e..ev.. / hePr he co n icoj 3r-pu dtcotth. -0tugur 1cm - rrujie dc -puro,.trt o. peroo1-e-te-umtr s.,r 15 fcool . o :uums t- peu de col//v. a hie of --av The 10 sci-1ai prede.a 40 offaprtig ..ah year, 20 o/ ocicR are enId, ced 1îrpîceth. 't ttcst.'mv.t, chqeotd . pr-d-t/e t m -'.etmtu u. duitu'n ep'et 10 utdtltrc 1%c -iv 10 adules lt.ht are as/cas durig th. y.l,. T/cc 10 oteah uipnsa o tc - -s rcvh at.l 1c, tc c orsSnet teht..re upaatIlIpo't.u...t" sn ocmtpa /f-ra.l tr.h-opca.. seI - 01-D- f- I -sy tSc herd is ccpklufhd.oar fiee yeara. vv"vcttcttu"u leou.u 82La/co filr pur- ohet .ed hanly. 31 daya//c; 15 ef ehih fu. laecr 10 ut chic/c oce Ia/cr, paO t u doecr P.ur c~ bl due etI ug.t 1Jour bu o'w it"le -ot...s dit 10 no-t de unu d'ouepac ff /2/day (D5 6,5/day ile n1Iteer. Fer cer 32 daYm Ile 0 uT cih/c/ ar ttir-d 1hor paid OR 50 dot. 0/c / 'jt DE jue elu dataa. t,rt"oottj oS ut/ or sasOmur arS paucieI 'a ~ yé 93/ Lah- t., pot,t.ea 130 daye/hat ef th. 97 dayp fosr -" thc creppine ef 0.75 h4e, 57 dccc arc Mot, d'oeuvr P-t lan Ponc du, tee- et133 Joutehc our Ivu 97 l ose ee re a 1 utr de 0.70 ha, 57 juec pcoeided t-'yî hired lahbr ai Sf 6.5/day. ot.ftresPar dc lu sait d'eutre an/t-e, Nf 6.5/.o,z -0' L.ahn fer ce n u dp per -ee of TacS/p heIp foc cc/c ' ced feediog e/e os. Mat i etvr 2pv/ meuteh. 1 J-t. p.r -eei- Seetd 'otîr.oiUî pourl '10' rote I ut uettatuc Il Ila unele. 1_2/ IsSu ion ahep 0sr ahephard foc, tha seti-r ccsc /tatly hcl1p/, il Ma t-cc pt r- t et Emut1-. t gard/ev Os, truopeat _tItt 1 it noe0eurfmil 12/ F.Itili--- nd p..ti.id... 7~~~~~~~5 q.t.t.la If t DH 6- o i peuHu4d0u 7.5 u2c5set- d'ougr7_ 'c 1DR 660 Rm 080H+4I0 222 pou25 rcpt oce/c,itaeectcide a/ctfegididat 42/ Lasd prePara i-n Th. fanse des uns on tase on tilt/cea eqoipeat. 2e reo au animal to,pion ano d. rtaro -t tcne- Le utv/orn diepone ni d5nct.r/p n,II de octérool de laor I lou sete/age, hasr a/c 2H 50//ca. h han/casa to ha t/ilsd, Il, DE 30/. d4,v "tos DHo0 O hIettar. 6 te hb preparer colt DMf 300. 32/ Teediefg dams nons 4 qulce.al cf b-ary dceisg th. -3-, main/p derisg /cie,a3 faeo e rgc le /anhig. 14, Nottvrlture de la cahe. 4 uletau dAucun au .our de env rtc9eei das- Ile SéîuoOo de aro de orae .23/ tue ut irrg,i5set Te ru tie ast-u and p-sp - 4,052,3 tsaer n20O Iflt,ItD , c .5 1/ Cu-t deI ler~gatin. Pnîieemu du noeu to de te puepe - .500ec d'oau'a DE O,lO' F:/pai1y eneipeoti- Bonu sheat - 19 as DE 63 = D/f 37/; b-aI/y 29 ce OR 40 " 2/f 80; total If/ 458/. 1/S' buol.cmaioc é dur - 6 Q k H 63 00178t -rge - 'A SH 40 =o Nf 8; total DH1 458. 1jy 10 adeIt shP, satan chai 2 pe-ce1d; --erge fnc ni - co-1a O/I 250. 1. 0Aomnn/onsaea5aee oaeé ucued ntt rsvped iqelc /23 28/ phypaIL-1eotface 1/M et -Psssc. IF Ispeéve 1o% des d'pe...... APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 1: Well Drilling and Purchase of Pump on a Rainfed Cereal Farm Cash floyw Statement/Mouvement des fonds 1 2 3 4 5 6 7-8 9 10 ....(DH).... Cash Inflow: Ressources: Income 9,806 10,756 10,706 11,431 10,931 11,431 10,931 10,931 11,431 Recettes Medium-term Loan 3,996 - - - - - - - - Prêt à moyen-terme Farmer's Contribution 2,664 - - - - - - - - Contribution de l'exploitant Short-term Loan 2,312 2.312 2,312 2.312 2,312 2,312 212 2.312 2,312 Prêt à court-terme Total 18,778 13,068 13,018 13,743 13,243 13,743 13,243 13,243 13,743 Total Cash Outflow: Utilisation: Operating Expenses 7,352 7,352 7,352 7,352 7,352 7,352 7,352 7,352 7,352 Dépenses Investment 6,660 - - - - - - - - Investissement Medium-term Debt Service: Service de la dette à moyen-terme: Interest 300 239 180 120 60 - _ _ _ Intérêt Principal 800 799 799 799 799 - - - - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 116 116 116 116 116 116 116 116 116 Intérêt Principal 2J31 2 2,312 2 2,312 2,312 2.312 2,312 2312 2 Principal Total 17,540 10,818 10,759 10,699 10,639 9,780 9,780 9,780 9,780 Total Surplus 1,238 2,250 2,259 3,044 2,604 3,963 3,463 3,463 3,963 Recettes nettes Incremental Revenue 2,689 3,639 3,589 4,314 3,814 4,314 3,814 3,814 4,314 Revenu supplémentaire Incremental Expense 2,439 2,439 2,439 2,439 2,439 2,439 2,439 2,439 2.439 Dépenses supplémentaires Incremental Net Income 250 1,200 1,150 1,875 1,375 1,875 1,375 1,375 1,875 Revenu net supplémentaire Investment 6,660 - - - - - - - (930) Investissement Results Financial Rate of Return/ Taux de Rentabilité Financière: 18.2% Sensitivity Tests/Etude de sensibilité: Expense/Dépenses : +10 : 12.7% Investment/Investissement +10% : 15.6% Revenue/Revenu: -10% 9.8% W APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 2: Purchase of Draft Animals & Basic Agricultural Implements on a Rainfed Cereal Farm Technical Coefficients/Coefficients Techniques Without Proiect With Proiect/Avec Proiet Sans Projet Fiscal Income DH 2,250 DH 2,400 Revenu Fiscal Cropping Ha Yield Ha Yield Cultures Durum wheat 2 6.5 t/ha 3 6.5Q/ha Bld dur Barley 2 7.0 3 7.0 Orge Maize 2 5.5 2 5.5 Mals Fallow 2 - Jachère Total 8 8 Total Livestock No. No. Elevage Cattle 4 4 Bovins Sheep 80 80 Ovins ------Main d'Oeuvre----- Working Days Family Labor Hired Labor Total Familiale Salari4 Total Journdes de Travail I Wheat & barley 56 68 124 84 4o 124 Ble et orge Maize 30 34 64 44 20 64 MSis Total 7z 102 (a) ibb 128 -177 Total (a) of which 42 days are included in "Rent for (a) dont 42 jours compris dans Plowing, Harrowing' "Loyer pour labourage, hersage" Investment Cost/Coût d'Investissement (DR) Number of Units Cost per Unit Foreign % Foreign Exchange Investment Items Nombre d'Unités Coût Unitaire Local Exchange Total % Devises Investissements Devises Draft mules 2 DL 600 1,200 - 1,200 - Mulets Plow 1 500 400 100 500 20% Charrue Harrow 1 400 320 80 400 2% Herse Subtotal 1,920 180 2,100 9Z Soustotal Physical Contingencies (5%) 96 9 105 Imprevus (5%) Total 2,016 189 2,205 9% Total APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 2: Purchase of Draft Animals & Basic Agricultural Implements on a Rainfed Cereal Farm Income Statement/Compte d'Exploitation (DH) Income Without Project/Sans Projet With Pro ject/Avec Projet Revenu Years 1 - 6 Durum wheat 2/ 819 1,228 Blé dur 2/ Barley il 560 840 Orge 3/ Maize 4/ 495 495 Ma - Milk 6 2,160 2,160 Lait 6/ Sheep 3,200 Moutons Total 7,234 7,923 Total Operating Expenses Coûts de Production Seeds 2/ 3/ 4/ 266 389 Semences 2/ 3/ 4/ Rent for plowing, harrowing - 150 - Location attelages et outils / Hired labor -7 390 520 Main d'Oeuvre salariée 7 Feeding animals -/ 280 330 Alimentation animaux 8/ Milk (family consumption) - 1,660 1,660 Lait (consommation 9/ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~familiale) 5 Contingencies (10%) 9/ 274 290 mprivus (ll ) 9/ Total 3,020 3,189 Total Net income before taxes 4,214 4,734 Revenu net avant impôts Taxes 68 80 Impots Net Income 4146 4_654 Revenu Net l/Without the Project, the farmer rented mule team and equipment 1/ Sans le Projet le fermier louait attelage et outillage 2/ Durum wheat at DH 63/Q; seeds 120 kg/ha 2/ Bl a dur a DH 63/Q; semence 120 kg/ha 3/ Barley at DH 40/Q; seeds 120 kg/ha 3/ Orge a DH 40/Q; semence 120 kg/ha 4/ Corn at DH 45/Q; seeds 20 kg/ha 4/ Mais à DH 45/Q; semence 20 kg/ha 5/ Local cows. Milk production for family consumption; 5/ Vaches locales. Production laitière pour consommation familiale; in the spring, excess production is sold: au printemps, l'excédent de production est vendu: 590 1 at DE 0.85 = DH 500. Each cow produces about 600 litres 590 l'a DH 0.85 O DH 500. Chaque vache produit environ 600 litres of milk (average) during the year. Average price during the de lait au cours de l'année (moyenne). Prix moyen au cours de year is DH 0.90; price during peak season is DH 0.85. l'année DH 0.90; prix en haute lactation DH 0.85. 6/ 80 sheep - 32 sheep at DH 100 are sold each year 6/ 80 ovins - 32 ovins à DH 100 chaque annee sont vendus 7/ Manpower: 10 days at DH 6.5/day for each hectare 7/ Main d'oeuvre: 10 jours à DH 6.5/jour pour chaque hectare 8/ During the winter and in summer, cows are given a supplement 8/ En hiver et en éteé, on donne un appoint d'orge aux vaches: of barley: 1 kg per head for 175 days, or 800 kg at 1 kg par tête pendant 175 jours, soit 800 kg à DH 40/Q = DH 280. DH 40/Q = DH 280. During the ploughing period, mules receive Les mulets en période de labour reçoivent 2 kg d'orge soit > 2 kg of barley, or 1 x 2 x 60 days = 120 kg, i.e., DH 50. 1 x 2 x 60 jours = 120 kg, i.e., DH 50. 9/ Physical contingencies 10% of expenses 9/ Imprévus 10% des charges ( x APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 2A: Purchase of Draft Aaimals and Basic Agricultural Implements on a Rainfed Cereal Farm (CLCA Customer) Cash flow Statement/Mouvement des fonds 1 2 3 4-5 6 .... (DH) .... Cash Inflow: Ressources: Income 7,923 7,923 7,923 7,923 7,923 Recettes Medium-term Loan 1,039 - - - - Prêt à moyen-terme Government Subsidy 474 - - - Subvention de l'Etat Farmer's Contribution 692 - - - - Contribution de l'Exploitant Short-term Loan 2,000 2,000 2,000 2,000 2.000 Prêt à court-terme Total 12,128 9,923 q,923 9,923 9,923 Total Cash Outflow: Utilisation: Operating Expenses 3,269 3,269 3,269 3,269 3,269 Dépenses Investment 2,205 -- - - Investissement Medium-term Debt Service: Service de la dette à moyen-terme: Interest 78 48 19 - Intérêt Principal 394 394 252 - - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 100 100 100 100 100 Intérêt Principal 2,000 2,000 2,000 2,000 2,000 Principal Total 8,046 5,811 5,640 5,369 5,369 Total Surplus 4,082 4,112 4,283 4,554 4,554 Recettes nettes Incremental Revenue 689 689 689 689 689 Revenu supplémentaire Incremental Expense 181 181 181 181 181 Dépenses supplémentaires Incremental Net Income 508 508 508 508 508 Revenu net supplémentaire Investment 2,205 - - (525) Investissement Results Financial Rate of Réturn Taux de sensibilité Financière; 22.2% Sensitivity Tests/Etude de sensibilité;: X Expense/Dépenses; +10%: 20.6% Investment/Investissement: +10% : 17.7% Revenue/Revenu: -10%: 15.6% APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 2B: Purchase of Draft Animals and Basic Agricultural Implements on a Rainfed Cereal Farm (COOPERATIVE) Cash flow Statement/Mouvement des fonds 1 2 3-5 6 Cash Inflow: ... . (DH) .... Ressources: Income 7,923 7,923 7,923 7,923 Recettes Long-term Loan 1,731 - - - Prêt a long-terme Government Subsidy 474 - - - Subvention de l'Etat Short-term Loan 2,000 2,000 2,000 2.°°° Prêt à court-terme Total 12,128 9,923 9,923 9,923 Total Cash Outflow: Utilisation: Operating Expenses 3,269 3,269 3,269 3,269 Dépenses Investment 2,205 - - - Investissement Long-term Debt Service: Service de la dette à long-terme: Interest 121 60 - - Intérêt Principal 866 865 - - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 80 80 80 80 Intérêt Principal 2,000 2,000 2,000 2.000 Principal Total 8,541 6,274 5,349 5,349 Total Surplus 3,587 3,649 4,574 4,574 Recettes nettes Incremental Revenue 689 689 689 689 Revenu supplémentaire Incremental Expense 181 181 181 181 Dépenses supplémentaires Incremental Net Income 508 508 508 508 Revenu net supplémentaire Investment 2,205 - - (525) Investissement Results Firancisl Rate of Retu-n/ Taux de Rentabilité Financière: 20.5% Sensitivity Tests/Etude de sensibilité: Expense/Dépenses: +10qo 18.7% Investment/Investissement- +10% 16.1% Revenue/Revenu: -1O% ; 14.0% a 4> APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 3: Stable Construction & Purchase of 2 Crossbred In-calf Heifers for Milk Production on a Rainfed Cereal Earm Technical Coefficients/Coefficients Techniques Without Project ------ With Project/Avec Projet Sans Projet Fiscal Income DH 1,640 DH 1,940 Revenu Fiscal Cropping Ha Yield Ha Yield Cultures Durum wheat 5 6.5Q/ha 5 6.5Q/ha Ble' dur Barley 5 7.0 5 7.0 Orge Maize 2 5.5 2 5.5 Mais Vetch oats - - 1 - Vesce avoine Total 12 13 Total Livestock 4 # Elevage Mules 2 2 Mulets Crossbred cows - 2 Vaches race croisee Total 2 4 Total Investment Cost/Coût d'Investissement (DH) Number of Units Cost per Unit Foreign % Foreign Exchange Investment Items Nombre d'Unites Coût Unitaire Local Exchange Total % Devises Investissements Devises Crossbred in-calf heifers 2 DH 1,750 3,500 - 3,500 - Genisses pleines de race croisée Stable 30m2 100 1.890 1.110 3.000 Etable 1-3 Subtotal 5,390 1,110 6,500 17/ Soustotal Physical Contingencies (5%) 270 55 325 Imprévus (5%) Total 5,660 1,165 6,825 175/. Total APPRAISAL OF A TIHIRD AGRICULTFMAL CREDIT PROJECT 4 MOF,OCCO Table 3.2 Model 3: Stable Construction & Purchase of Crossbred Heifers for Milk Production on a Rainfed Farm Income Statacent/compte d'Exploitation (DU) Without Pro1ect _______,____________W…ith Prolect/Avec Proje---------------------------------- Sans Projet Income 1 2 3 4 & 6 5 7 & 9 8 _10 Revenu Dur- hesat 2,047 2,047 2,047 2,047 2,047 2,047 2,047 2,047 2,047 B1e dur l/ Barley 1,400 1,220 1,220 1,220 1,220 1,220 1,220 1,220 1,220 Orge Maize 3 495 495 495 495 495 495 495 495 495 Mdis 2 Vetch ypto -~/1 - - - - - - - - - Vesce Avoine S Milk -l - 2,160 2,160 2,160 2,160 2,160 2,160 2,160 2,160 Lait 7/ Calves & Old Caws 6/11/ - - - 1,000 1.500 1,000 1,000 1.200 Veaux et Vaches Reformétes /1/ Total - 3,942 5,922 5,922 6,922 7,422 6,922 6,922 5,922 7,122 Total Operating Expenes coûte de Production Seed foro 9-ns i/ 1/ 2/ 636 636 636 636 636 636 636 636 636 Semences cereaiee__2/.2/ tabor J1 780 845 845 845 845 845 845 845 845 Main d'Oeuvre -12 Forage Production 2/ - 215 215 215 215 215 215 215 215 Cout Production Vesce Avoine 2/ Feeding Mules 1 6û 65 65 65 65 65 65 65 65 Alimentation Mulets "/ Reneval of Moles 2/ - - - - 600 - - - Renouvellement ulets _/ Feeding Cows J 180 180 180 180 180 1i0 180 180 Alimentation Vaches 2J Milk Fai,ily Consumption 1 648 648 648 648 648 648 648 648 Lait de Consommation Faeiiiai-el Contingencies (10%) 148 259 259 259 259 259 259 259 259 Imprévus (10%) Total 1,624 2,848 2,848 2,848 2,848 3,448 2,848 2,848 2,848 Total Net Income before Taxes 2,318 3,074 3,074 4,074 4,574 3,474 4,074 3,074 4,274 Revenu Net avant Impôts T5xes 19 43 43 43 43 43 43 43 43 Irp6ts Net Inceme 2_299 3.031 3.031 4.031 4,531 3.431 4.031 3.031 4.231 Revenu Net D/ turum wheat at Dr 63/o. 1/ Blé dur à tl 63/q.; seeds 120 kg/ha semences 120 kg/ha j Barley at DH 40/Q.; / Orge ' rdH 40/Q. seade 120 kg/ha. 4.5s consumed by dairy COwS. semences 120 kg/ha. 4.5C autoconsommes par les vaches laitières, V Corn at DH 45/hia. / Mais à EN 45/Q.; sus 20 kg/ha, semences .20 kg/ha 5/ Vetch oats. Consumed by dairy cows; its production 5/ Vesce avoine. Consommée par les vaches laitières; la production is not counted. n'est pas comptabilisée. 2/ Mules. DHI 1,200 per teame. Kept for 6 years and sold 2/ Mulets. DE 1,200 la paire. Gardés 6 ans et revendus a Ii 600. for rH 600. The tesm is replaced at year 5. La paire est renouvelée à l'année 5. 5_/ Crossbred cows. 5/ Vaches de race croisêe. Year 1: 2 in-calf heifere bought at end of year Année 1: 2M4tnisses achetées pleines en fin d'annAe Year 2: 2 born, 1 male and 1 female Anne'e 2: 2 naissances, 1 mroe et 1 femelle Year 3: 1 male calf sold Amie 3: 1 veau mile vendu Year 4: 2 born, 1 male and 1 female. 1 heifer sold Anneée 4: 2 naissances, 1 m2ie et i femelle. 1 génisse vendue Year 5: 1 maile calf sold Annee 5: 1 veau mole vendu Year 6: 2 borr, 1 male and 1 femaie. i hbifer anld Anéde 6: 2 naissances, 1 maile et 1 femelle. 1 génisse vendue Year 7: 1 male calf sold Année 7: 1 veau r-le vendu Year 8: 2 born, 1 male and 1 femmae Année 8: 2 naissances, 1 mtLe et 1 femelle. Year 9: 1 masle calf sold Ann'e 9: 1 veau cAle vendu Year 10: 2 born, 1 old caw sold Annee iO 2 n2aesaos,1vacho 0o . 0e vendue -7/ Milk. Each cov produces 1,200 1/year at DR 0.90 DM/litre on th. average j!lAit. Chaque vache produit 1,20 /nID0 900EH/Iijtre an moyenne 762 1 are kept for fasily ..ss.asption. Milk sold 2,400 x 0.9 = DM 2,160; 762 1 sont gardés pour la consommation familiale. Lait vendu 2,400 x 0.9 silk kept for family consusption 762 x 0.85 = DE 648 = DM 2,160; lait consommé par la famille 762 x 0.85 = DM 648 I/ Labor. 10 days at DH 6.5 per cultivated hectare / Main d'oeuvre. 10 journées à DH 6.5 par hectare cultivé 9/ Forage production: vetch sts.- seeds DR 82 2/ Production de fourrage: vesce avoine. semences DH 82 fertilizers 55 ehgrais 88 mechanical mmuer 78 coupe mécanique 78 Total DH 215 Total DH 215 1O/ Before the Project, the farmer epent DH 60, the price of l.SQ of barley 19/ Avant le Projet le fermier dépensait DH 60, prix de l.SQ d'orge to feed his animals during tilling. 12 ha of cultivated land, or DH S pour nourrir ses bites pendant les labours. 12 ha labourés soit DM S of food per hectare; 13 ha for DM 65 of harley. de nourriture par hectare; 13 ha reviennent à DH 65 d'orge. 11/ One male c.1f, I year old, sold for DR 1,000 11/ Veau Ale vendu Dh 1,ODO 'a un an One heifer, 2 years old, sold for DM 1,500 G6nisse vendue DR 1,500 'a 2 ans One old com sold for DH 1,200 Vache reformge vendue DH 1,200 12/ Labor for livestock is femily labor 12/ La main d'oeuvre pour le bitail est familiale 4PPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 3A: Stable Construction and Purchase of Crossbred In-Calf Heifers for Milk Production on a Rainfed Cereal Farm (CLCA Customer) Cash flow Statement/Mouvement des fonds 1 2 3 4 5 6 7 8 9 10 .... (DH) .... Cash Inflow: Ressources: Income 5,922 5,922 6,922 7,422 6,922 7,422 6,922 5,922 6,922 7»122 Recettes Medium-term Loan 4,095 - - - - - - - - - Pret à moyen-terme Farmer's Contribution 2,730 - - - - - - - - - Contribution de leExploitant Short-term Loan 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 Prêt à court-terme Total 16,997 10,172 11,172 11,672 11,172 11,672 11,172 10,172 11,172 11,372 Total Cash Outflow: Utilisation: Operating Expenses 2,891 2,891 2,891 2,891 2,891 2,891 2,891 2,891 2,891 2,891 Dépenses Investment 6,825 - - - - - - - - - Investissement Medium-term Debt Service: Service de la dette à moyen-terme: Interest 307 246 184 123 61 - - - - - Intérêt Principal 819 819 819 819 819 - - - - - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 212 213 212 213 212 213 212 213 212 213 Intérêt Principal 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 Principal Total 15,304 8,419 8,356 8,296 8,233 7,354 7,353 7,354 7,353 7,354 Total Surplus 1,693 1,753 2,816 3,376 2,939 4,318 3,819 2,818 3,819 4,018 Recettes nettes Incremental Revenue 1,980 1,980 2,980 3,480 2,980 3,480 2,980 1,980 2,980 3,180 Revenu supplémentaire Incremental Expense 1,248 1,248 1,248 1,248 1,248 1,248 1,248 1,248 1,248 1,248 Dépenses supplementaires Incremental Net Income 732 732 1,732 2,232 1,132 2,232 1,732 732 1,732 1,932 Revenu net supplémentaire Investment 6,825 - - - - - - - - (4,550) Investissement Results Income from milk decreased by 20% Revenu du lait diminué de 20% Financial Rate of Return / I-3 Taux de Rentabilité Financière: 24.3% p Financial Rate of Return / Sensitivity Tests/Etude de sensibilité: Taux de Rentabilité Financière: 15,6% Expense/Dépenses: +10% : 21.6% Investment/Investissement: +10% : 21.7% Sensitivity Tests/Etude de sensibilité; Revenue/Revenu: -10% : 18.8% Expense/Dépenses: +10% : 13.2% Investment/Investissement: +10% : 13,9% APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 3B: Stable Construction and Purchase of Crossbred In-Calf Heifers for Milk Production on a Rainfed Cereal.Farm (COOPERATIVE) Cash flow Statement/Mouvement des fonds 1 2 3 4 5 6 7 8 9 10 .... (DR) .... Cash Inflow: Ressources: Income 5,922 5,922 6,922 7,422 6,922 7,422 6,922 5,922 6,922 7,122 Recettes Medium-term Loan 4,778 - - - - - - - - Prêt à moyen-terme Farmer's Contribution 2,047 - - - - - - - - - Contribution de l'Exploitant Short-term Loan 4,250 4 4,250 4,250 4,250 4,250 4,250 4 4,250 4,250 Prét aà court-terme Total 16,997 10,172 11,172 11,672 11,172 11,672 11,172 10,172 11,172 11,372 Total Cash Outflow: Utilisation: Operating Expenses 2,891 2,891 2,891 2,891 2,891 2,891 2,891 2,891 2,891 2,891 Dépenses Investment 6,825 - - - - - - - - - Investissement Medium-term Debt Service: Service de la dette à moyen-terme: Interest 406 339 272 205 137 70 47 23 - - Intér8t Principal 790 790 790 790 790 276 276 275 - - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 170 170 170 170 170 170 170 170 170 170 Intérêt Principal 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 4,250 Principal Total 15,332 8,440 8,373 8,306 8,233 7,657 7,634 7,609 7,311 7,311 Total Surplus 1,665 1,732 2,799 3,366 2,939 4,015 3,538 2,563 3,861 4,018 Recettes nettes Incremental Revenue 1,980 1,980 2,980 3,480 2,980 3,480 2,980 1,980 2,980 3,180 Revenu supplémentaire Incremental Expense 1,248 1,248 1,248 1,248 1,248 1,248 1,248 1,248 1,248 1,248 Dépenses supplémentaires Incremental Net Income 732 732 1,732 2,232 1,132 2,232 1,732 732 1,732 1,932 Revenu net supplémentaire Investment 6,825 - - - - - - - - (4,550) Investissement Results Income from milk decreased by 20% Revenu du lait diminué de 20% Financial Rate of Return / Taux de Rentabilité Financière: 23.5% Financial Rate of Return I Sensitivity Tests/Etude de sensibilité: Taux de Rentabilité Financière; 14,9% X Expense/Dépenses: +10% : 20.8% w . Investment/Investissement: +10% : 21.0% Sensitivity Tests/Etude de sensibilité:' Revenue/Revenu: -10% : 18,1% Expense/Dépenses: +10% 12.4% Investment/Investissement: +10% : 13.3% APPRAI0AI 2F A THIRD0 AGRIUTC/RAI0 CRsîI~ PR JET RodeO 4: Iulhsec Livlesoe fur Milke Production (Vases> Techoteeâ Oceffiol enta~TChpim /Oof±in1sne ~Taohngo WitIsoOOteiGOe. ---------Wit------------- ---- Sea Projet 2 À. J _ . Voua horst ~ ~ ~~ ~ ~ ~~~ ~ ~~~2 6 6 6 7 Oc 12 1 8Vaches NM îFkj 2M 2FB, 18 124- 2112B2 ad 212k 3 3R 2M3 2PA4 45 421B4 2M 32k 6A 2R5 h 324VaA6elAcoe Valoqe l-year-oîd 12k1 2FR1 1 1203 3BR3 22k4 4FR4 32 5FR5 281v Be 2 mo~~~IFA3 3F3 2A4 4B4 ve.d~ Helfer 2-y.eara.od IVA} 2FRî 12k2 221B2 12k33A 3 22k4AB4 Vonil Er-a B-nc /14 Bayes ha) 168 168 168 164 163 166 168 :68 166 168 î68 F8sole(14 joor/ha) S,gor Ovet '70 layc;4a( 225 30V 302 020 32 --75 375 375 450 450 45o Betterav (75 Jour/ha) Verol (12 Anse ho> 12 .41 24 24 36 48 n 48 6o 62 7/ Bori. (12 jours/ha) Roibe Foroge (22 doye/ha( __ __ 22 2 2 44 44 44 66 Ma'Ie Forag 22 jours/ha) Tcta1 855 924 324 925 W97 4,015 1.018 72457 1,109 75 1 Total Cou-Pe,M bn-er 1 2 2 2 2 2 3 3 3 3 Vtahe.~ (notre) Tractur (Wookîa Bours) --------------------------------- - - - -Ro-------------------------------Heure du Tranteor Dr- uheat (84/ha> 240 2413 244 240 240 24V 24t '40 240 7251 24V - Rî dur (813/ha> Aorîoy (813/ha> 16o . 144 ihî 144 136 128 120 20 ooh 124 96 ega (dbh/ha) ASîl1 Brod Beass /80/ha) i20 î8 108 i (XI 108 10 4 0 1o8 - 8 108 îoe 128 Prrîe (91/ha) Sngar Beet (1313/ha> 39 52 52 52 52 65 65 65 78 78 78 Betterave (13 h/ha) looa(2133ha>. 20 40 42) 40 6û 60 8e 80 soc île 120 Recala (2213/ha> doler Forage (120/ha> 10 12 12 24 24 24 36 Raie Vorrege (02h/ha> Conbine Whoat, Barley (Ra-rasted Hia) 50 48 48 48 47 46 îs h5 43 4o 42 Mol.eau.. su.s Batteuse (ha.eaasas Ete-a bro- (NI) 5,700 6,480 6,562 6,720 7,03V 7,420 7,732 7,~77V 8,590 8,910 9.380 Reven Au-a (DH> Duru easat (DE 256/ha) 7,680 7,680 7,66o 7,680 7,68o 7,486 7,680 7,68o 7,680) 7,680 718 BIî dur (2H 256/ha) Rarley (NI 171/ha> À 3,420 3,078 3,278 3,278 2,907 2,736 2,365 2,565 2,223 2,223 2,052 045 (3 7/a Von1l B-od Bean (EH 70O/ha) 4/ 840 8o 840 842 842 84o 840 84e 84o 840 840 -eveolle (13H 7V/ha> 5 Sugar Reat (DR 807/ha) t, 2,421 3,228 3,R28 3.228 3.228 4,035 4.035 4,035 4,842 4,842 4,842 Betterc (DR807'hs> t lerel (80 75/ha> ~ , 75 150 150 150 225 225 320 300 375 375 450 Berin (OR 7V/ha Matou Foras (rIE 129/ha) .127 .d2 129 o 58 8 37Mais Forrg D/H 129/ha> 2 Tota1 I1,1(727 78>9 R7 4 11,974 '78 5,135 15,549 18757 1=13,1 488483on SOngar Been (3,000 a /~ha) 9,000 10,000 12,000 12,000 12,8000 15,000 15 000 10M 00 8,ooo î8,ooo c9.VVV Betnerae 1'3,003 a /ha> rc:'t h0 c ta 2,005 200 4.200 4.02 6, ouc 6,'000 10.0Cor ic00o 12,2V 1_0-- 20Q - h.) ha '-îtg .o0o2'n ___h_ j,0O2 3,2 ___ 000 0 M,000 2ournge .00V 1. A nng DR/n 5 0, 06/.' (011 664c 3n0 ,9 9£? 1,/no ,4,-~' o.74o 0,040 2,040 2,3 Brio P Moyen D 0.213/o3 >Do> j t oi A; À--o , fr- he-d hefore p,ojen: -neb1e B: horo f-c herV ponîhoono ndnr pri200 tn A! idu troupeur onnt 1n pro/ent; O4at/i i,: nd do tenopon o-heo 00001O p-njenta O -ccî /0 ~ te D/' 102; fetl r20 a' DH 60; pee:ccideo 006 noenno1> 'A0 DH02; ero22401 À H~ ; poot-.nd-u 013 nb /3 -ec' 1.03 c. 22I 70: IQ~o1er1 an DH 60; pesmneido, OH 6 3 Oocoo1.04 3 01/ 70: vegrein IQ'o DH 60; p-onlodAc lii 6 T3eeAo2- kg DH S/ .eaecee 25 hg à NI 3 Sondk /0 n, 7/ HS04onoQt sc6co. 20 kg 24 00 0. 45;e-g-ei 24 n DOi 60 -, cii-ny 18 monhe; nu tkde onno necct d-00 -d ntn-arrig-, ce vver 2 po-r U/O tous les î8 ota; pour ten- ecopto d- -oto ni desaoreet ..n.ou las deuxan APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 4: Purchase of Livestock for Milk Production Income Statement/Compte d'Exploitation Without Project------------------------- With Project/Avec Projet------------------------- Income Sans Projet 1 2 3 4 h 6 7 8 9 10 Revenu Durum wheat2-/ 28,350 28,350 28,350 28,350 28.350 28,350 28,350 28,350 28,350 28,350 28,350 Ble'dur Barley t2 3/ 16,000 14,400 14.400 14,400 13,600 12,800 12,000 12,000 10,400 10,400 9,600 Orge Small Broad Beans 6,48o 6,480 6,48o 6,480 6,480 6,48o 6,48o 6,480 6,48o 6,48o 6,480 Féverolles 3 Sugar Beet g 11,520 15,360 15,360 15,360 15,360 19,200 19,200 19,200 23,040 23,o40 23,040 Betterave E Milk 2,916 6,948 6,948 6,948 8,406 13,122 14,580 17,496 18,954 23,328 26,244 Lait 5 Calves 1,000 2,000 1,000 2,000 2,000 3,000 2,000 4,000 2,000 6,o0o Veaux a Total 65,266 72,538 73,538 72,538 74,196 81,952 83,610 85,526 91,224 93,598 99,714 Total Operating Expenses Coûts de Production Inputs 14,436 14,976 14,976 14,976 15,009 15,645 15,549 15,678 16,218 16,218 16,251 Intrants Tractor & Driver 10,206 10,512 10,512 10,512 10,724 11,034 11,250 11,466 11,777 11,777 12,168 Tracteur & Chauffeur Combine 7,500 7,200 7,200 7,200 7,050 6,900 6,750 6,750 6,450 6,450 6,300 Moisonneuse Batteuse Permanent Workers 7,200 9,600 9,600 9,600 9,600 9,600 9,600 12,000 12,000 12,000 12,000 Main d'Oeuvre Permanente Hired Labor 3,200 3,360 3,520 3,680 3,840 4,000 4,160 4,320 4,480 4,640 4,800 Main dUoeuvre Salarieé Irrigation Costs 7/ 660 960 960 960 1,26o 1,44o 1,560 1,740 2,o40 2,o40 2,340 Coûts d'Irrigation Contingencies (10%)- 4.320 4,661 4.677 -277M - 4.748 4.862 4.887 5,195 5,297 5.313 5.386 Impr'évus(10%) 7t Total 47,522 51,269 51,445 51,620 52,231 53,481 53,756 57,149 58,262 58,438 59,245 Total Net Income before Taxes 17,744 21,269 22,093 20,918 21,965 28,471 29,854 28,377 32,962 35,160 40,469 Revenu Net avant Impôts Taxes 344 416 424 440 471 510 541 565 627 659 706 Impôts Net Income 17.400 20.853 21.669 20.478 21,494 27,961 29.313 27,812 32.335 34,501 39.763 Revenu Net Investment Cost/Cout d'Investissement (DH) A ~~~~~Devises Nombre d'unitès~ CouAt Unitaire Foreign Devises Investment Items Number of Units Cost Per Unit Local Exvhange Total eoreises Investissements Stable 150 m2 133 12,600 7,400 20,000 37% Etable In-calf heifer Frisian 4 4,000 1 600 14.400 16.000 90% Génisses pleines Frisians Subtotal 14,200 21,800 36,000 61% Soustotal Physical Contingencies (5Z) 710 1,090 1,800 Imprévus (5%) Total 14,910 22,890 37,800 61% Total / 15Q/ha at DH 63 i 15Q/ha à DH 63 / 20Q/ha at DH 40 20Q/ha à DH 40 3/ 12Q/ha at DEH 45 3/ 12Q/ha à DH 455 / 40T/ha at DEH 96 S/40T/ha à DH 96 5 12 l/cow for 270 days at DH 0.9 5/ 12 1/vache pour 270 jours a DEH 0.9 / Male calves,,1-year-old, sold for DH 1,000 V/ Yeaux m^les vendus DH 1,000 a un an 7/ Physical contingencies 107 of expenses 7/ Imprévus 107 des charges APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 4: Purchase of Livestock for Milk Production Cash flow Statement/Mouvement des fonds 1 2 3 4 5 6 7 a 9 10 ,--- (DH) .. -Cash Inflow: Ressources: Income 72,538 73,538 72,538 74,196 81,952 83,610 85,526 91,224 93,598 99,714 Rcettes Medium-term Loan 26,460 - - - - - - - - - Prêt à moyen-terme Farmer's Contribution 11,340 - - - - - - - - - Contribution de l'Exploitant Short-term Loan 30,300 30,300 30,300 30,450 31,000 30,800 31,150 31,500 31,500 31.650 Prêt à court-terme Total 140,638 103,838 102,838 104,646 112,952 114,410 116,676 122,724 125,098 131,364 Total Cash Outflow: Utilisation: Operating Expenses 51,685 51,869 52,060 52,702 53,991 54,297 57,714 58,889 59,097 59,951 Dépenses Investment 37,800 - - - - - - - - - Investissement Medium-term Debt Service: Service de la dette à moyen-terme; Interest 2,249 1,893 1,537 1,181 825 469 312 156 - - Intérêt Principal 4,190 4,189 4,190 4,189 4,190 1,837 1,838 1,837 - - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 1,313 1,313 1,313 1,319 1,343 1,335 1,350 1,365 1,365 1,372 Intérêt Principal 30,300 30,300 30,300 30,450 31,000 30,800 31,150 31,500 31,500 31,650 Principal Total 127,537 89,564 89,400 89,841 91,349 88,738 92,364 93,747 91,962 92,973 Total Surplus 13,101 14,274 13,438 14,805 21,603 25,672 24,312 28,977 33,136 38,391 Recettes nettes Incremental Income 7,272 8,272 7,272 8,930 16,686 18,344 20,260 25,958 28,332 34,448 Revenu supplémentaire Incremental Expense 3,819 4,003 4,194 4,836 6,125 6,431 9,848 11,023 11,231 12,085 Depenses supplémentaires Incremental Net Income 3,453 4,269 3,078 4,094 10,561 11,913 10,412 14,935 17,101 22,363 Revenu net supplémentaire Investment 37,800 - - - - - - - - (56,700) Investissement Results Income from milk decreased by 20%: Revenu du lait diminué de 20%: Financial Rate of Return / Taux de Rentabilité Financière: 25.5% Financial Rate of Return / Sensitivity Tests/Etude de sensibilité: Taux de Rentabilité Financière; 19,7% Expense/Dépenses: +10% : 23.9% 4- Investment/Investissement: +10% : 23.8% Sensitivity Tests/Etude de sensibilité; Revenue/Revenu: -10% : 22.0% Expense/Dépenses: +10% : 18,2% Investment/Investissement: +10% : 18.4% APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 4: Feed Resources/Ressources en Fourrage Without Project ------------------------Year/Année…------------------___ Sans-Projet i 2 3 4 5 6 7 8 9 10 Livestock: Bétail: Cows & heifers 2 6 7 9 10 12 13 16 18 22 25 Vaches et génisses Calves 2 5 4 5 5 7 7 10 9 14 12 Veaux UGB equivalent 6 17 18 23 25 31 33 42 45 58 62 UGB équivalent 1,000 UF 9 25.5 27 34.5 37.5 46.5 49.5 63 67.5 87 93 1,000 UF équivalent equ±ivalent Wheat Straw 18.2 18.2 18.2 18.2 18.2 18.2 18.2 18.2 18.2 18.2 18.2 Paille Barley 16.2 14.6 14.6 14.6 13.8 13 12.2 12.2 10.6 10.6 9.8 Orge Sugar beet 3.3 4.4 4.4 4.4 4.4 5.5 5.5 5.5 6.6 6.6 6.6 Betterave à sucre Bersim 7.5 15.0 15.0 15.0 22.5 22.5 30.0 30.0 37.5 37.5 45.0 Bersim Maize forage - - - - 7.5 7.5 7.5 15.0 15.0 15.0 22.5 Mais fourrage Total 45.2 52.2 52.2 52.2 66.4 66.7 73.4 80.9 87.9 87.9 102.1 Total > CD APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 5: Purchase of Combine on a Rainfed Farm Technical Coefficients/Coefficients Techniques ---- Without Proiect/Sans Projet -----With Project/Avec Projet---- Fiscal income DH 8,400 DH 8,400 Revenu fiscal Cropping Ha Yields Ha Yields Cultures Durum wheat 60 18Q/ha 60 19Q/ha Blé dur Barley 30 16Q/ha 30 17Q/ha Orge Chick peas 30 12Q/ha 30 13Q/ha Pois chiche Total 120 120 Total ----------Labor ---------- -------Main d'Oeuvre------- Working Days Permanent Seasonal Total Permanente Saisonnière Total Journeés de Travail Durum wheat ) 600 1,110 1,710 5io 240 810 (Ble dur Barley 60110,105020( Orge Chick peas 279 300 570 300 120 420 Pois chiche Total 870 1,410 2,280 870 360 1,230 Total Investment Cost/Cout d'Investissement (DH) Cout Unitaire Devises % Devises Investment Items Cost par Unit Local Foreign Exchange Total % Foreign ExchanRe Investissements Combine harvester 140,000 41,800 98,200 140,000 70% Moissonneuse batteuse Physical contingencies (5%) 2,090 4.910 7,000 Imprévus (57%) 43,890 103,110 147,000 70% @ ANNEX 4 Table 5.2 a- c.a e.c~ ~~~~~ ce .a o asa,tc Oc 'e c c_c - c - - c st a s -_ -- t i 5 ce s se c sé c' °° as cc as cc as .ec c ric 2 s 4c-t4c f-- ' Se ao« oc-. ta g s S- -e-a .ç t s ....c-c.e-a ...,Sc. e-.......... c-as -a U -c -e s - e ce C- c O :c c e, a, ce, 4 a s 4 s * ^*ac s.a,cc+e t caca Ç Ç e t a *-e @ : r s: : r : 5 « lia-etc 21 e act s: c c e.5 5 : . ot et te 4c c ce aste , œ O sete= -e co D s5' Va -a-c cc a cac cs c Va a> c o oa ,,e c a c oa a te a ea a e oe c c c teo 6~~~~ aI e ° I e- att Cae s5 t 5 . t a ce ca o eaoa ecac - _ _ _ ~ ~ ~ c _ a a-e~I a-i-i- c s c c pE~ ~ ~~~~a _c a]c_cas ,Oc I OC sO ô o, co -o cee o a |a ai-ao o _ O '. ., ,° o coC o o o 55 =5 a- C e O fo c - o oooooo ,,oo , 5 c e] Cg COC C O O CC COC C C O E a-e 9 CcX 00| C, C O c o o eoco c ocoo o C C, -- aa aas ai+e cao- Cea o - e cacoo o oce o cc a--e o o o ci ccs,c a,°°° c ce C° s,° HR ~ N -ccC a-|C s, b ec Ceaa S °- , acCe r_ e~~ ~ I - e s a o~~ c a a ~~c Ce e - ae APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 5: Purchase of Combine on a Rainfed Farm Income Statement/Compte d'Exploitation Income Without Project/Sans Projet (DH) With Project/Avec Projet Revenu Years 1-10 Durum wheat 68,040 71,820 Blé dur Barley 19,200 20,400 Orge Chick peas 45,000 46,350 Pois chiche Income from combine - 17,550 Revenus dûs a la 1/ moissonneuse batteuse - Total 132,240 156,120 Total Operating Expenses Couts de Production Before harvest: Avant récolte: Burum wheat 23,580 23,580 Ble'dur Barley 11,100 11,100 Orge Chick peas 11,250 11,250 Pois chiche 4 Permanent workers 9,600 9,600 4 Ouvriers permanents Harvest: 3 Récolte: 3/ Hired labor - 2/ 14,100 3,600 Main d'oeuvre salariee - 2/ Harvest with combine - 7,350 Recolte a la mdssorineuse batteue - Contingencies (10%) 6.963 6,648 Imprevus (10%) Total 76,593 73,128 Total Net Income before taxes 55,647 82,992 Revenu Net avant impôts Taxes 608 608 Impôts Net Income 55,039 82,384 Revenu Net 1/ 390 hours at DH 80/hour (minus DH 35/hour cost) 1/ 390 heures à DH 80/heure (moins les coeûts DH 35 par heure) 2/ Cost of operating the combine: maintenance DH 22/hour 2/ Coût d'opération de la moissonneuse batteuse: entretien DH 22/heure fuel (15 1/hour at DH 0.53/1) 8/ " carburant (15 1/heure ' DH 0.53/1) e/ , oil 2/" lubrifiant 2/ " > driver & assistant (DR 15 & DH 9/day ) 3/ conducteur et aide (DH 15 et DH 9/jour) 3/ " Cost DH 35/ " Coût DH 35/ " 3/ at DH 10/day (peak season rate) 3/ à DH 10/jour (taux saisonnier) u > APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 5: Purchase of Combine on a Rainfed Farm Cash flow Statement/Mouvement des fonds 1 2 3 4 5 6-10 .... (DH) .... Cash Inflow: Ressources: Income 156,120 156,120 156,120 156,120 156,120 156,120 Recettes Medium-term Loan 102,900 - - - - - Prêt à moyen-terme Farmer's Contribution 44,100 - - - - - Contribution de l'Exploitant Short-term Loan 51,000 51,000 51,000 51,000 51,000 51,000 Prêt à court-terme Total 354,120 207,120 207,120 207,120 207,120 207,120 Total Cash Outflow: Utilisation: Operating Expenses 73,736 73,736 73,736 73,736 73,736 73,736 Dépenses Investment 147,000 - - - - - Investissement Medium-term Debt Service: Service de la dette à moyen-terme: Interest 8,746 6,997 5,248 3,499 1,749 - Intérêt Principal 20,580 20,580 20,580 20,580 20,580 - Principal Short-term Debt Service: Service de la dette à court-terne: Interest 2,040 2,040 2,040 2,040 2,040 2,040 Intéret Principal 51,000 51,000 51,000 51,000 51,000 51,000 Principal Total 303,102 154,353 152,604 150,885 149,105 126,776 Total Surplus 51,018 52,767 54,516 56,265 58,015 80,344 Recettes nettes Incremental Revenue 23,880 23,880 23,880 23,880 23,880 23,880 Revenu supplémentaire Incremental Expense (3,465) (3,465) (3,465) (3,465) (3,465) (3,465) Depenses supplémentaires Incremental Net Income 27,345 27,345 27,345 27,345 27,345 27,345 Revenu net supplémentaire Investment 147,000 - - - - _ Investissement Resuits Custom work charge decreased to Dh 70/hour Custom work charge decreased to Dh 60/hour: Revenu du travail à façon abaissé à Dh 70/heure Revenu du travail à façon abaissé à Dh 60/heure Financial Rate of Return / Taux de Rentabilité Financière: 17.6% Financial Rate of Return / Financial Rate of Return / Sensitivity Tests/Etude de sensibilité: Taux de Rentabilité Financière; 12.3% Taux de Rentabilité Financière: 7.0% Expense/Dépenses: +10% : 17.1% Investment/Investissement; +10% 14.2% Sensitivity Tests/Etude de sensibilité; Sensitivity Tests/Etude de sensibilité: Cr Revenue/Revenu: -10% : 14.4% Expense/Dépenses: +10% : 11.9% Expense/Dépenses: +10% : 6.5% e X Investment/Investissement: +10% : 9.5% Investment/Investissement: +10% : 4.5% i. APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 6: Purchase of Tractor & Soil Preparation Equipment Technical Coefficients/Coefficients Techniques Without Project/Sans Projet -- With Project/Avec Projet------ Fiscal income DH 3,000 DH 4,200 Revenu fiscal ----------------Yield--------------- Cropping Ha Yield Ha Year 1 Year 2 Year 3 Year 4 Cultures 1/ Hurum wheat 30 12Q/ha-/ 30 15Q/ha 16.OQ/ha 17.OQ/ha 18Q/ha Blé dur Chick peas 30 6Q/ha- 30 8Q/ha 9.OQ/ha 9.5Q/ha IOQ/ha Pois chiche 60 60- Livestock Elevage Mules (5 teams) 10 ° Mulets (5 attelages) Working Days Days/ Ha Number Days/ Ha Number Journées de Travail Family labor: Main d'Oeuvre familiale: 1hirum wheat il 330 6 180 Ble dur Chick peas 13 390 13 390 Pois chiche Total 720 570 Total Permanent workers 5 mule drivers 1 tractor driver Ouvriers permanents Investment Cost/Cout d'Investissement (DH) Investment Items Nombre d'Unites Cout Unitaire Local Devises Total % Devises Investissements Number of Units Cost per Unit Foreign % Foreign Exchange Exchange Wheel tractor 77CV 1 47,000 19,740 27,260 47,000 58% Tracteur a roues 77CV H t Plough (3 disks) 1 5,300 2,760 2,540 5,300 48% Charrue (3 disques) Offset disk (20 disks) 1 8,340 497% Covercrop (20 disques) < x Subtotal 26,750 33,890 60,640 56% Soustotal Physical contingencies (5%) 1,337 1,695 3,032 Imprevus (5%) Total 28,087 35,585 63,672 56% Total 1/ No fertilizer 1/ Pas d'engrais APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 6: Purchase of Tractor & Soil Preparation Equipment Production Costs per Hectare/Cout de Production par Hectare (DH) -----Durum wheat/Blé dur -- --Chick peas/Pois chiche-- Without With Without With Sans Avec Sans Avec Land preparation 73 64 2/ 73 -/ 64 2/ Préparation du sol Seeds 63 95 75 75 Semences Fertilizers - 96 - 64 Engrais Herbicides - 22 - 22 Herbicides Harvesting 200 3/ 200 4 100 3/ 100 4 Récolte Transportation 31 - 72 - 31 - 72 - Transport Total 367 549 279 397 Total Income Statement/Compte d'Exploitation (DH) Without Project/Sans Projet -------------With Project/Avec Projet--------- Income Year 1 Year 2 Year 3 Years 4-10 Revenu Durum wheat (DH 63/Q) 22,680 28,350 30,240 32,130 34,020 Ble' dur (DH 63/Q) Chick peas (DH 125/Q) 22,500 30.000 33,750 35,625 37,500 Pois chiche (DH 125/Q) Total 45,180 58,350 63,990 67,755 71,520 Total Operating Expenses Coûts de Production rlarum wheat 11,010 16,470 16,470 16,470 16,470 Blé dur Chick peas 8,370 11910 11,910 11.910 11,910 Pois chiche Contingencies (10%) 1,938 2,838 2,838 2,838 2.L838 Imprévus (10%) Total 21,318 31,218 31,218 31,218 31,218 Total Net Income before Taxes 23,862 27,132 32,772 36,537 40,302 Revenu lqet avant Impôts Taxes 128 224 224 224 224 Impots Net Income 23 734 26.908 32,548 36,313 40,078 Revenu Net 1/ Ploughing--5 days/ha; harrowing--2 days/ha 1/ Labour --5 jours/ha; hersage--2 lours/ha Driver paid DH 8/day, mules fed 3 kg of barley/day at DH 0.4/ kg each Chauffeur payé DH 8/hour, mulets nourris de 3 kg orge/jour a DH 0./Vkg chacun Total cost DH 10.4/day Coût total DH 10.4/jour DH 73.0/ha DH 73.0/ha 2/ Cost of tractor per hour DH 11.8 2/ Coût du tracteur par heure DH 11.8 tractor d plough per hour 12.6 at 3.5 hours/ha DH 44/ha tracteur + charrue par heure 12.6 à 3.5 heures/ha DH 44/ha tractor + offset disk per hour 13.2 at 1.5 hours/ha DH 20/ha tracteur + covercrop par heure 13.2 à 1.5 heures/ha DH 20/ha > ' DH 64/ha DH 64/ha 3/ 3 days at DH 10.4/day 3/ 3 jours a DH 10.4/jour C x 4/ 6 hours at DH 11.8lhour 4/ 6 heures à DH 11.8/heure '< APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 6: Purchase of a Tractor and Soil Preparation Equipment Cash flow Statement/Mouvement des fonds 1 2 3 4 5 6-10 ...(DH) .. Cash Inflow: Ressources: Income 58,350 63,990 67,755 71,520 71,520 71,520 Recettes Medium-term Loan 44,570 - - - - Prêt à moyen-terme Farmer's Contribution 19,102 - - - - - Contribution de l'Exploitant Short-term Loan 24,000 24,000 24,000 24,000 24,000 24,000 Pret à court-terme Total 146,022 87,990 91,755 95,520 95,520 95,520 Total Cash Outflow: Utilisation: Operating Expenses 31,442 31,442 31,442 31,442 31,442 31,442 Dépenses Investment 63,672 - - - - - Investissement Medium-term Debt Service: Service de la dette à moyen-terme: Interest 3,788 3,031 2,274 1,515 758 _ Intérêt Principal 8,914 8,914 8,914 8,914 8,914 - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 960 960 960 960 960 960 Intérêt Principal 24,000 24,000 24,000 24Z000 24,000 24,000 Principal Total 132,776 68,347 67,590 66,831 66,074 56,402 Total Surplus 13,246 19,643 24,165 28,689 29,446 39,118 Recettes nettes Incremental Revenue 13,170 18,810 22,575 26,340 26,340 26,340 Revenu supplémentaire Incremental Expense 9,996 9,996 9,996 9,996 9,996 9,996 Dépenses supplémentaires Incremental Net Income 3,174 8,814 12,579 16,344 16,344 16,344 Revenu net supplémentaire Investment 63,672 - - - - - Investissement Results Financial Rate of Return Taux de Rentabilité Financiire: 18.4% Sensitivity Tests/Etude de sensibilité: Expense/Dépenses: +10% : 16.0% Investment/Investissement: +10% : 15.7% Revenue/Revenu: -10% : 13.0% APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 7 - Planting and Maintenance of Citrus Orchard Technical Coefficients/Coefficients Techniques Without Project/Sans Proiet With Project/Avec Projet Fiscal income DH 9,000 DH 13,000 Revenu fiscal Cropping Ha Yield Ha Yield Cultures Bread wheat 6 la 30 Q/Ha 6 ha 30 Q/Ha Blé tendre Sugar beet 5 ha 40 T/Ha 5 ha 40 T/Ha Betterave à sucre Small broad beans 2 ha 15 Q/Ha - Féverolles Alfalfa 2 ha 7,500 UF/Ha 4 ha 7,500 UF/Ha Luzerne Citrus 4 ha 20 T/Ha 10 ha 0-20 T/Ha Agrumes Fallow 6 ha Jachère Total 25 ha 25ha Sans Proiet -- - - ------ \4ith Proiect/Avec Proiet------------------------------- Working asys Without Project Year l Years 2-5 Year 6 Year 7 Year R Year 9 Year 10 Year 11 Journées de Travail Total working days 1,155 1,388 1,400 1,448 1,529 1,625 1,721 1,817 1,913 2,009 Total journées de travail Of which hired labor 714 961 995 1,043 1,161 1,261 1,357 1,453 1,549 1,445 Dont journées de salariés Permanent workers 3 4 4 4 4 5 5 5 5 5 Ouvriers permanents Investment Cost/Coût d'Investissement (DH) Investment Items Number of Units Cost per Unit Local Foreign Total % Foreign Exchange Investissements Nombre d'Unités Co_ut Unitaire Exchange % Devises Cost of Creation Devises Création Citrus plantation 6 ha 5,733 17,200 17,200 34,400 50 Plantation d'agrumes Physical contingencies (5%) 860 860 720 50 Imprevus (5%) Subtotal lô,GGG 18,ù6û 36,120 50 Subtotal Initial Maintenance Cost Entretien Year 1 6 ha 3,129 13,142 5,632 18,774 30 Année 1 Year 2 6 ha 581 2,440 1,046 3,486 30 Année 2 Year 3 6 ha 551 2,314 992 3,306 30 Année 3 Year 4 6 ha 688 2,890 1,238 4,128 30 Année 4 Year 5 6 ha 775 3,255 1,395 4 650 30 Année 5 Subtotal 24,041 10,303 34,344 30 Soustotal Total 42,101 28,363 70,464 40 Total -IX~ AFPPAISAL OF A T11RD AGtCtULTiRA. CREDIT FPROJECT0 Modol 7, Platioo & Maintenance cf Citru- Orohard Production Ctst per Heur anA/cc per hectare for Fe MOtchinery (DR) Unit Frire Woeking Routa Operetien & Meinrenenc Fuel & Oil Driver Ctst per Houe Woking Heurs/RH Production Ctst per Houe par Houe P-e Heur per Ha Rteel tracter 77CV 47,000 10,000 4.22 5.35 2.16 11.73 _ _ Tracent a rooes Fleegh (3 ploegishahes. 5,300 6,000 0.83 - - 12.56 3.5 43.93-44 Ch.r-e. (3 disques) Off.et Disk (20 di.ke) 8,300 5,400 1.46 - - 13.19 1.5 19.78-20 Covecrep (20 disques) Ridge pl-ogh 3,100 4,800 0.61 - - 12. 34 2.0 24.68-25 Biîooeute Seeder 6,500 3,000 2.06 _ _ 13.79 1.5 20.68-21 Senir Mpoing -eohine 8,000 6,000 1.26 - - 12.99-13 - - Faucheuse Truiler 9,600 10,000 0.91 - _ 12.64_13 - - Remarque Herseste o Cppbiae 152,000 6,000 17.10 L0.05 3.12 30.27 1.8 34.49-55 M ....ea.oeue-ibateuss Preductien test oe Coltiiuted Huctuce & Yialds Land Freperatile seedu Feetilitets Peeticldeo hi-ed LAbo- Coubine cr Irrigation Feeduatta Ct uai eroage YiaAd/ & TrenseoHt Frbnineg sebicides __ Mento Miahine P.e Hietare Ha Br-ad vhect 111 120 288 20 396 55 90 1,080 300 BI. tendre Slger bust 148 150 465 300 246 - 192 1,501 40T BHtteraveesucco Suall b-oad bnea 123 60 - - 30 - 75 288 150 Févero1e (vhse i.tnerropped 3/4 of cultivetad land) (an culture intn.c.l.t.s, 3/4 e la surface) Alfalfa 138 150 271 - - 175 300 1,034 7,500uf Laumet citaro at fol1 production 40 - 486 200 1,440 - 300 2,466 20T Agru-et ce production Nev citruo orchard Ynsr 1 335 550 925 - 959 - 360 3,129 _ Noe le Plantatio d'Ag--. Asssd I Ye-e 2 40 _0 81 - 300 90 538 Aende 2 lue_ 3 40 - 81 20 320 -90 551 Ra-de 3 Yest 4 40 50 168 20 320 - 90 688 Aus. 4 Yeat 5 40 50 255 20 320 - 90 775 -An-u 5 Yle- 6 40 -H 336 20 400 - 90 936 2T Aent. 6 luar 1' - - - - - - - 0~~~~ ~ ~~~~~~~~~~~~~~~~~~~~~~~~,191 51 Anade 31 Isa 8~ 1,446 81 Mstd len 91 - 1,701 lIT Rende 9- ys-elO - _ _ _ - _ _ 1,956 14T Anea '0- Yece Il - - - - - - - 2,211 17T Andéu 11î et 12 40 486 200 1,440 - 300 2,466 20T ;e25 g| te25 25 / Frer -th begiantig ef pruductien te fPol prodeetion, it Os ceeaiderud e Iene increete uf I/ Depieoi l enrts ta predortion jusqo a la plsin production, on edeat qs ce lie-ci cr ft liesetent prodectioe, *nd e Ies-s incteas.e fo predooties ceat. il en ua de re poot le coût de preductie. Ieceeeeetal ceit ef pnd.ettion pet year YO-A lent 6 2.466 - 936 - DH 255 ARgentetton du uet de praduetin par nu 2,466 - 936 -DH 25 te Yace 12 6 da l anad 6 ù lI-nee 12 6 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 7: Planting & Maintenance of Citrus Orchard income Statement/Compte d'Exploitation (DH) Without Proiect -----------------------------With ProjectjAvec Projet----------------------------- Income Sans Projet Year 1 Years 2-5 Year 6 Year 7 Year 8 Year 9 Year 10 Year Il Years 12-25 Revenu Bread wheat 11,340 11,340 11,340 11,340 11,340 11,340 11,340 11,340 11,340 11,340 Blé tendre Sugar beet 19,200 19,200 19,200 19,200 19,200 19,200 19,200 19,200 19,200 19,200 Betterave à sucre Small broad beans 1,350 3,036 3,036 3,036 - - - - - - Fdverolles Alfalfa 6,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 Luzerne Citrus under production 22,000 22,000 22,000 22,000 22,000 22,000 22,000 22,000 22,000 22,000 Agrumes en production New citrus plantation - - - 3,300 8,250 13,200 18150 23.100 28,050 33 Agrumes nouvelles plantations Total 59,890 67,576 67,576 70,876 72,790 77,740 82,690 87,640 92,590 97,540 Total Operating Expenses Coûts de Producticn Bread wheat 6,480 6,480 6,480 6,480 6,480 6,480 6,480 6,480 6,480 6,480 Blé tendre Sugar beet 7,505 7,505 7,505 7,505 7,505 7,505 7,505 7,505 7,505 7,505 Betterave à sucre Small broad beans 576 1,290 1,290 1,290 - - - - - - F8verolles Alfalfa 1,468 2,936 2,936 2,936 2,936 2,936 2,936 2,936 2,936 2,936 Luzerne Citrus under production 9,864 9,864 9,864 9,864 9,864 9,864 9,864 9,864 9,864 9,864 Agrumnes en production New citrus - - - 5,616 7,146 8,676 10,206 11,736 13,266 14,796 Agrumes nouvelles plantations Contingencies (10%) 2,589 2,678 2.807 3,240 3,393 3,546 3.699 3,852 4 005 Imprévus (10%) Total Operating Expenses 28,482 30,753 30,882 36,931 37,324 39,007 40,690 42,373 44,056 45,739 Total Net Income before taxes 31,408 36,823 36,694 33,945 35,466 38,733 42,000 45,267 48,894 51,801 Revenu Net avant imp8ts Taxes 668 668 668 1,088 1,088 1,088 1.088 1,088 1,088 1,088 Impôts Net Income 30,740 36,155 36.026 32,857 34,378 37,645 40 912 44,179 47 806 50,713 Revenu Net s 1 APPRAISAL OF 4 THIRD ACRICULTURAL CREDIT PROJECT MOROCCO Model 7: Planting and Maintenance of Citrus Orchard Cash flow Statement/Mouvement des fonds 1 2 3 4 5 6 7 8 9 10 il 12-25 Cash Inflow: Ressources: Income 67,576 67,576 67,576 67,576 67,576 70,876 72,790 77,740 82,690 87,640 92,590 97,540 Recettes Medium-term Losn 38,426 2,440 2,314 2,890 3,255 - - - - - - - Pret à moyen-terme Farmer's Contribution 16,468 1,046 992 1,238 1,395 - - - - - - - Contribution de V'Exploitant Short-term Loan 250 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 Prêt à court-terme Total 147,970 96,562 96,382 97,204 97,726 96,376 98,290 103,240 108,190 113,140 118,090 123,040 Total Cash Outflow: Utilisation: Operating Expenses 31,421 31,550 31,550 31,550 31,550 38,019 38,412 40,095 41,778 43,461 45,144 46,827 Dépenses Investment 54,894 3,486 3,306 4,128 4,650 - - - - - - - Investissement Medium-term Debt Service: Service de la dette à moyen-terme: Interest 4,193 4,193 4,193 4,193 4,193 4,193 3,354 2,516 1,677 838 - - Intérêt Principal - - - - - 9,865 9,865 9,865 9,865 9,865 - - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 1,360 1,360 1,360 1,360 1,360 1,360 1,360 1,360 1,360 1,360 1,360 1,360 Intérêt Principal 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 25,500 Principal Total 117,368 66,089 65,909 66,731 67,253 78,937 78,491 79,336 80,180 81,024 72,004 73,687 Total Surplus 30,602 30,473 30,473 30,473 30,473 17,439 19,799 23,904 28,010 32,116 46,086 49,353 Recettes nettes Incremental Revenue 7,686 7,686 7,686 7,686 7,686 10,986 12,900 17,850 22,800 27,750 32,700 37,650 Revenu supplémentaire Incremental Expense 2,271 2,400 2,400 2,400 2,400 8,869 9,262 10,945 12,628 14,311 15,994 17,677 Depenses supplémentaires Incremental Net Income 5,415 5,286 5,286 5,286 5,286 2,117 3,638 6,905 10,172 13,439 16,706 19,973 Revenu net supplémentaire Investment 54,894 3,486 3,306 4,128 4,650 - - - - - - - Investissement Results Citrus output delayed one year/ Production d'agrumes retardée d'un an Financial Rate of Return / Taux de Rentabilité Financière: 14.4% Financial Rate of Return / Taux de Rentabilité Financière; 11.8% Sensitivity Tests/Etude de sensibilité: Expense/Depenses: +10% : 13.1% Sensitivity Teats/Etude de sensibilité; Investment/Investissement: +10% : 13.2% Expense/Dépenses: ±10% 10.5% m Revenue/Revenu: -10% : 11.8% Investment/Investissement: +10% 10.8% CD> Revenue/Revenu: -10% 9.4% APPFAISAL OF A ThIAD AGRICULTURAL CREDIT PROJECT Model 8; Drilling Well & Furchase of Fump for Early Vegetable Production Technicel C0effieiente/Coeffieients Techniques Without Project/Sans Proiet ----------------With Proiect/AUec Projet--------------- Fiscal Income rH 240 EH 3,500 Revenu Fiscal ------------------ - ---------------------- Cropping Ha Yield Ha Year 1 Year 2 Year 3 Years 4-la0 Cultures Durun wheat 2 lOQ/ha I 12Q/ha 13Q/ha 14Q/ha 159/ha Blé dur Chick peas 2 7Q/ha - - - _ _ Pois chiche Early potatoes i/ - 1 12T/ha 13T1'ha 14T/ha 15 T/ha Pommes de terre primeur.!/ Early tomatoes (smooth type)2/ - 1 24T/ha 26T/ha 28T/ha 30T/ha Tomaies primeur 2 Maize forage 2 5,625uf/ha 6,250uf/ha 6,875uf/ha 7,500uf/ha Mdis fourrage Bersim - 1 5,625uf/ha 6,250uf/ha 6,875uf/ha 7,500uf/ha Bersim Total 7 7 Total Workint Days 42 daye 882 days Journé. de Travail Investment Cost/Coût d 'Investissement (DR) Nombre d'Unités Coût Unitaire Devises % Devises Investment Items Number of Unita Cost per Unit Local Foreign Exchange Total % Foreign Exchange Investissements Drilling Well & Equipment 1 17,000 11,900 5,100 17,000 30% Creusement et Equipement Puits Motor 66 CV (Diesel) 1 22,000 9,460 12,540 22,000 57% Moteur Diesel 66CV Pump (Vertical axis) & Appliances I 15,000 7 200 7 800 15,000 52% Pompe 'a Axe Vertical & Accesaure , 2, t 5, ° 4771 Physical Contingencies (5%) 1,428 1,272 2,700 I4p$éw6 (56) Total 29,988 26,712 56,700 47% Total Production Coats per Hectare/CoGts de Praduation par Hectare Land Fertilizers Wind Breaks Irrigation Pest Working Days Production Cost Preparation Manure Chemicals Seeds Poles, etc. Transplant Weeding Herbicide DH 2003 Control Harvet Transport (DR 8/day) Total (HDN/HaH) D1,OOOm Durum sheat BefPre Project 160 - 50 100 - - - 200 20 530 After Project 160 - 130 100 - - - 20 - - 200 20 72 702 Chick peas 160 - 50 125 - - 30 - - - 100 20 - 485 Early potatoes 240 - 600 2,000 300 - 50 60 600 500 100 50 1,016 5,516 Early tomatoes 1,740 3,000 600 600 4,800 200 - 60 800 2,500 - 100 2,960 17,360 Bersim 160 - 160 300 - - - - 600 50 180 120 192 1,762 Maize forage i6o - 260 40> - - 20 800 50 80 120 208 1,738 1/ of which the following, in Years 1-4, are for export: 8T, 8T; 9T, lOT i dont pendant les années 1, 2, 3, & 4-10 pour l'exportation: 8T, 8T, 9T, lOT 4 of vhich the folloeirg, in Years 1-4, are for export; lOT, 12T, 13T, 15T !2/ dont pendant les années 1, 2, 3, & 4-peau l'exportation: 10T, 12T, 13T, 15T APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 8: Drilling Well & Purchase of Pump for Early Vegetable Production Income Statement/Compte d'Exploitation (DH) Without Project/Sans Projet -----------Iith Pro¶actlAvac Prolet--------- Income Year 1 Year 2 Year 3 Years 4-10 Revenu Durum wheat (DIT 23/Q) 1,260 756 819 882 945 Blé dur (DH 63/Q) Chick peas (DH 125/Q) 1 1.750 - - - - Pois chiche (DH 125/Q) Early potatoes - 7,200 7,600 8.300 9,000 Pomme de terre primeur 1/ Early tomatoes 2/ - 19,200 22,200 24,000 27,000 Tomate primeur Maie forage (DH 0.4/uf) 4,500 5,000 5,500 6,000 Mais Fourrage (DH 0.4/uf) Bersim (D ./n)__ 2,250 2,500 2,750 J3999 Rersimi(M0./f Total 3,010 33,906 38,119 41,432 45,945 Total Operating Expenses Coûts de Production Durum wheat 1,060 702 702 702 702 B1é dur Chick peas 970 - - - - Pois chiche Early potatoes _ 5,516 5,516 5,516 5,516 Pomme de terre primeur Early tomatoes - 17,360 17,360 17,360 17,360 Tomate primeur Maize forage - 3,476 3,476 3,476 3,476 Mais forrage Bersim - 1,762 1,762 1,762 1,762 Bersim Contingencies (10) 203 2,882 2, d82 2.882 2,882 Imprévus (10%) Total 2,233 31,698 31, 698 31,698 31,698 Total Net income before taxes 777 2,208 6, 421 9,734 14,247 Revenu net avant impôts Taxes - 168 168 168 168 Impôts Net income 777 2 040 6 253 9.566 14_079 Revenu net D DH 700/T for export; DH 400/T for local consumption D/ OH 700/T pour l'exportation; DH 400/T pour consommation locale 2/ DH 1,500/T for export; DH 300/T for local consumption D/ OH 1,500,T pour l'exportation; DH 300/T pour consommation locale 0 Z e' Z APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO Model 8: Drilling Well and Purchase of Pump for Early Vegetable Production Cash flow Statement/Mouvement des fonds 1 2 3 4 5 6 7-10 (DH).... Cash Inflow: Ressources: Income 33,906 38,119 41,432 45,945 45,945 45,945 45,945 Recettes Medium-term Loan 39,690 - - - - - - Prit à moyen-terme Farmer's Contribution 17,010 - - - - - - Contribution de l'exploitant Short-term Loan 8,200 8g0 8,200 8,200 8,200 8,200 8,200 Prèt à court-terme Total 98,806 46,319 49,632 54,145 54,145 54,145 54,145 Total Cash Outflow: Utilisation: Operating Expenses 31,866 31,866 31,866 31,866 31,866 31,866 31,866 Dépenses Investment 56,700 - - - - - - Investissement Mediumterm Debt Service: Service de la dette à moyen-terme: Interest 3,374 2,911 2,237 1,562 887 212 - Intérêt Principal 5,439 7,938 7,938 7,938 7,938 2,499 - Principal Short-term Debt Service: Service de la dette à court-terme: Interest 437 437 437 437 437 437 437 Intérêt Principal 8,200 8,200 8,200 8,200 8,200 8,200 Principal Total 106,016 51,352 50,678 50,003 49,328 43,214 40,503 Total Surplus (or deficit) (7,210) (5,033) (1,046) 4,142 4,817 10,931 13,642 Recettes nettes Incremental Revenue 30,896 35,109 38,422 42,935 42,935 42,935 42,935 Revenu supplémentaire Incremental Expense. 29,633 29,633 29,633 29,633 29,633 29,633 29,633 Dépenses supplémentaires Incremental Net Income 1,262 5,476 8,789 13,302 13,302 13,302 13,302 Revenu net supplémentaire Investment 56,700 - - - - - (8,100) Investissement Results Variations in income from export vegetables/ Variatiôns de revenu provenant des primeurs Financial Rate of Return 'exportation: Taux de Rentabilité Financière: 14.2% Revenu - 5% : 10.8% Sensitivity Tests/Etude de sensibilité: Revenu -10% : 7,4% Expense/Dépenses: +10% : 6.7% Revenu -15% : 4.0% w- > Investment/Investissement: +10% ; 12.1% Revenu -20% 0.3% Revenue/Revenu: -10% : 4.2% ANNEX 5 APPRAISAL OF A THIRD AGRICULTURAL CREDIT PROJECT MOROCCO CNCA Future Lending Program and Project Cost 1. The attached tables show the forecast CNCA lending program until 1981-82. On the basis of the existing policy objectives for the Moroccan agricultural sector and taking into account past experience, the agricultural investments likely to take place have been forecast for the country as a whole. The areas to be cultivated and the resulting short-term production needs have also been estimated. Only a portion of these investments and production needs is likely to be financed by CNCA, and the lending program has been com- puted accordingly. In some cases where this approach was not feasible (such as in the case of the CLCAs), future loans have been forecast only on the basis of past trends. 2. Table 1 gives the basic assumptions regarding the physical invest- ments to be financed by CNCA (Headquarters and CRCAs). Tables 2, 3, and 4 show the resulting lending program for HQ and CRCAs. Table 5 shows the lend- ing program for the CLCAs. These forecast loan commitments have been used to arrive at the forecast financial statements of CNCA (Annex 2, Tables 19 to 21). 3. To define the Project itself as part of this lending program, one has to consider only the period of January 1, 1977 to August 31, 1979, to ex- clude loans for non-productive purposes and loans to companies, to discount for those loans that are committed but never disbursed and to eliminate some loans that would not be re-eligible for refinancing for procurement and other reasons. The subborrower's contributions and Governnent grants have to be added to loan amounts to arrive at Project costs. Table 6 is a detailed Proj- ect Cost table and Table 7 is a detailed Project Financing table. Physical contingencies average 5%. Price contingencies have been computed on the basis of the forecast price increases in Table 1 for each type of investment; they average 15.4% for the local cost and 29.6% for the foreign exchange cost, or 19.9% for total cost. 02gQQ~~Q~~0gQ: ShorI-ter, Lorns ltoeeltese3 Preors-ogu do Preeresese dea Pr ts de la CNCA (SiNge et CRIAs): peSta 7 Court-ternie (Atertbtîion.) (DE '000) Estimation Estieste Foreras te/Preusten 1975/76 1976/77 1977/78 1978/79 1979/80 1980/Si 1981/82 Production Crodit to Sedividssl FaruIeru, Gnoses, Crédit de Prod-ction eux Indiuldaela Cotrertives., Coorerarives & Cesorenies Oroosemasta er iooie4t rtin and puls 107,296 118,512 130,584 144,011 15S,457 174,984 192,801 Cérales et l;gumneuss ) RI-ce 8u000 8,820 9,720 10,723 11,826 13,028 14,365 Rie Ros crupe 500 525 550 580 610 640 670 Plntes sarclees 5 Pleenceesns de caepegne Fodder- rop 500 525 550 580 610 640 670 Culturea Foorrag-eu Uarvesr loenu 5,000 5,250 5,500 5,S00 6,100 4,400 6,700 Freis de roasse Tot.a.e. 13,956 15,898 18,012 20,465 23,181 26,237 29,971 Tetes) Potgtoes 2,761 3,145 3,556 4,025 4,561 5,157 5,725 Po.ases de terre ) Cultures s,aetcherss Other vegertbles 3,896 4,284 4,710 5,186 5,690 6.245 6,850 Atore Ctrrs 11,690 13,123 14,760 16,573 18,616 20,908 23,503 Agrumes Flire trees 1,192 1,977 2,913 4,018 5,329 6,883 8,70D oîsciers ) ntrestien de plantetiass Vinoyarde 1,033 1,516 2,074 2,734 3,487 4,368 5,396 Vigne ) Other fruit trees 1,368 1,995 2,734 3,587 4,574 5,711 7,002 Arees) Bgf 79,2D0 91,151 104,777 120,254 137,958 158,037 180,959 Eebooche bovine SheeP 30,288 36 114 41 510 47,384 52,486 61,952 70,433 Esbeetle o-ite îivestocls teed 4, 50 4,725 4,960 5,210 5,470 5,740 6,030 Alimenta de bétail Chicske breedieg 400 420 440 460 490 510 540 Avioîtrure Re-k-epi 400 420 -440 -46?0 490 500 540 Aple-1t,sr Onbiotal 271,980 308,400 347,790 392,050 439,935 497,950 560,855 SOoslotal - Comerehensive Indusirmal Crues Procra= Cultsons ntéteeIse Cottop, 25,520 28,920 32,742 37,039 42,047 47,666 53,987 Coton suger Suer 085560 99 430 111,723 125,467 140 795 158,055 177,261 Betteeue 'sucre Sogar cne 3,465 4,780 6,322 8,125 15,707 24,808 33,912 Cane ù sucre OoSsflos,er 10.000 11,025 12,154 13,399 14,770 16,306 17,956 Ten-eneol terg 6 000 6.930 7,944 9.035 10.206 11.490 12.864 Msie hybride Subtoal 130,545 151,085 170,885 193,065 223,525 258,325 295,980 Soustotal mIrketinR 4 other L.!n. PIPI. de cpR=sercialisetion et AutIeP Petts Fodder pregraI 1i,300 12,400 13,700 15,D00 16,500 18,200 20,000 op-ration eourr-ge 8uger progran 3,000 5,100 5,200 5,310 5,410 5,520 5,630 Finance=tcampegne aunriere 8uger bee seeds (C06AGRI) 10,000 10,200 10,400 10,610 10,820 11,040 01,260 Se=ence betterave (C00MG8I) cure sarde (COMAPRA) 4,000 4,08D 4,160 4,240 4,330 4,420 4,500 Semence mte hybeide (COMAPHA) Cottvo rarketin8 (COIAPRA) 39,000 39,780 40,580 41,390 42,210 43,060 43,920 Wartaetageesursrrrastage reton (COMAPRA) Gran rbties (SCAM, f8M,) 50,990 51,000 32,000 53,100 54, 100 5205,0 ouecaielndeorse SAI eA Grsi mIrketing (8CA6 C) 1000 1,020 1,040 1,060 1,080 1,100 1,125 Oursarrstage ris (StCARI) c l r e 1,000 1,020 1,040 1,060 1,080 1,100 1,125 Consortium egruRe (CC) Milk marketing (COLAINORD) 150 150 160 160 160 170 070 C=emuercielisetioe do lait (COLAOINRD) Misella neou- 25 65 45 55 50 15 135 Div- 8ubtotal 121,475 124,815 128,325 131,985 135,740 139,825 144,165 Soustotal Total 524.000 584.300 647.000 717 100 799.200 896,100 1D00l.000 TStug 1/ of vhih: Individu-l farnets 214,850 243,620 274,750 309,720 347,500 393,380 443,100 1/ dost pdru: nue .artlcsliers Ccopopatives 27,200 30R840 34,780 39,200 44,000 49,800 56,100 gos Coopératives de la séforn- Agr-ire Frec.perti-e groupe 270 300 350 400 435 500 55 ..u G-opene..îs Orgte co,panieu 27,200 30,840 34,780 39,200 44,000 49,000 56,100 eus Sooées dEtrt Feivatremo=panies 2,460 2,800 3,130 3,530 4,D00 4,470 5,000 aux Sociétés prlriee APPRAISAL OF A TbIRD AGRlCLTOJRAL CR2DIT PROJECT MOROCCO Caisse Naticorlo de Crddit Agricole Forgeant CNCA L.nding Progra: CLCA ensitnto/pr a « « p+Qa jz8S ,,,.d ',,'XXt<3n s~~~~~~~~~~~~~~~~~~~~~~~~~~~ 6t aa' 26t~~~~~~~~~~~~~~~~~~~ F~~~~~~~~~~' .,g; 33~~~~~~~~~~~~~ 19 I o t E>.Sæ |s| a Iiié< _°Re n o * o < f nôosZg9 b'o r°Wo--n o rWa o y www #| ° *| ; > m « t1 @|| °~~~~~~~~~~~~ |~~~~~~ < alSs« ~aOs =2tO9" 4~>æ< eoO nMAttR OS CI 3jNl5 ROJJ; TAE )ç h CO1 N . 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