Document of The World Bank FOR OFFICIAL USE ONLY FILE COPY Report No. P-3117-BT REPORT AND RECOMIENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE REPUBLIC OF BOTSWANA FOR A THIRD EDUCATION PROJECT October 29, 1981 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 Currency Unit Pula (P) US$1.00 P 0.78 P1 US$1.28 ABBREVIATIONS AfDB - African Development Bank ALDEP - Arable Land Development Program CJSS - Community Junior Secondary Schools EEC - European Economic Community MLGL - Ministry of Local Government and Lands MOE - Ministry of Education MOWC - Ministry of Works and Communications NDPV - Fifth National Development Plan, 1979-85 ODA - Overseas Development Agency of the United Kingdom PEIP - Primary Education Improvement Project PIU - Project Implementation Unit PTTC - Primary Teacher Training College RSA - Republic of South Africa SIDA - Swedish International Development Agency TAPU - Teaching Aids Production Unit TGLP - Tribal Grazing Land Program UCB - University College of Botswana USAID - United States Agency for International Development FISCAL YEAR April 1 - March 31 FOR OFFICIAL USE ONLY Republic of Botswana Third Education Project Loan and Project Summary Borrower: Republic of Botswana Amount: US$20.0 million Terms: 17 years repayment, including 4 years of grace, 11.6 percent interest Project Description: The project would expand access to and improve the the quality and efficiency of primary education in Botswana, particularly in rural areas, through: (a) construction, furnishing and equipping of about 500 classrooms, with ancilliary buildings and facili- ties; (b) provision of about 200,000 textbooks and teachers guides; (c) construction of a new 300 student capacity primary teacher training college; and (d) technical assistance to strengthen capacity at ministerial and district government levels for implementing primary school programs and to support the Project Implementation Unit of the Ministry of Education. The project faces no special risks. This document has a restricted distribution and may be used by recipients only in the performance of | their official duties. Its contents may not otherwise be disclosed without World Bank authorization. - ii - Estimated Project Costs: ------US$ Million------ Local Foreign Total Civil Works, Furniture, Equipment and Textbooks Primary Education 5.33 10.35 15.68 Primary Teacher Training 1.45 2.83 4.28 Sub-Total 6.78 13.18 19.96 Technical Assistance 0.06 0.55 0.61 Professional Services 0.13 0.51 0.64 Base Cost 6.97 14.24 21.21 Contingencies Physical 0.68 1.22 1.90 Price 2.35 4.54 6.89 Sub-Total 3.03 5.76 8.79 Total Project Cost 10.00 20.00 30.00 of which Taxes 0.80 0.00 0.80 Total Net Project Cost 9.20 20.00 29.20 Financing Plan Bank - 20.00 20.00 Republic of Botswana 10.00 - 10.00 Total Cost (including taxes) 10.00 20.00 30.00 Estimated Disbursements: Bank FY 1982 1983 1984 .1985 1986 1987 Annual - 2.80 5.40 5.80 4.50 1.50 Cumulative - 2.80 8.20 14,00 18.50 20.00 Staff Appraisal Report No.: No. 3549-BT, dated October 1, 1981 Rate of Return: Not Applicable INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE REPUBLIC OF BOTSWANA FOR A THIRD EDUCATION PROJECT 1. I submit the following report and recommendation on a proposed loan to the Republic of Botswana for the equivalent of US$20.0 million for a Third Education Project. The loan would have a term of 17 years, including four years of grace, with interest at 11.6 percent per annum. PART I - THE ECONOMY1 2. Botswana is a landlocked country in Southern Africa, bordered by the Republic of South Africa (RSA), Namibia, Zambia and Zimbabwe. With an area of 570,000 sq km and an estimated population of 800,000 (1980), it is not densely populated. Over 80 percent of the population is concentrated along the relatively fertile eastern third of the country, however, as two thirds of the country is covered by the Kalahari Desert. Rainfall is erratic and drought frequent. 3. Botswana's economy has historically been centered on the livestock industry, which has been the principal source of income in rural Botswana. Social institutions have guaranteed access to communal grazing lands and established cattle ownership as a symbol of status. Manufacturing is domi- nated by beef-processing and the use of animal by-products. Although supported by preferential access to the lucrative European Economic Community (EEC) market, the livestock industry has been plagued in recent years by outbreaks of hoof and mouth disease and both livestock and crop farming have been periodically devastated by drought. 4. In the 1970s, diamond, nickel and copper mining became the main spur to economic growth, leading to real increases in GDP of 10 percent a year during the decade. The value of diamond production alone more than quadrupled between 1977 and 1980 and diamonds now account for more than 50 percent of exports. The production of copper/nickel also rose rapidly despite technical difficulties and volatile prices, and exports currently account for about 20 lThe most recent economic memorandum on Botswana (Report No. 1832-BT) was distributed to the Executive Directors on April 20, 1978. This section on the economy incorporates information from an updating mission whose report is scheduled for distribution in December 1981. Country data are given in Annex I. - 2 - percent of total exports. The trade and services sectors expanded more rapidly than overall GDP, and government services alone increased in excess of 11 percent a year. However, agricultural value added stagnated, particularly in the second half of the decade. In the arable sector low returns, caused in part by the lack of appropriate technical packages and the availability of cheap food imports from the RSA, resulted in a fall in productivity and output. In the livestock sector, low off-take rates and cattle diseases did not allow for significant increases in production. Nevertheless, as a result of the favorable growth of the overall economy, per capita GNP2 rose from US$110 in 1970 to about US$720 in 1979. 5. The balance of payments and fiscal situations also improved during the past decade. Increased receipts from the Customs Union,3 direct taxes and mineral royalties caused recurrent revenues to rise nearly 33 percent a year, which was substantially in excess of the growth in recurrent expend- iture. Recurrent budgetary surpluses, together with grants, covered nearly half of the steadily growing capital expenditures and the Government became a net creditor of the banking system. Since 1973, the economy has also shown overall surpluses in the balance of payments, due primarily to the rapid rise in exports and to large private capital inflows associated with mining invest- ments. By end December 1980, net international reserves had risen to about US$261 million, equivalent to more than six months merchandise imports. Inflation was moderate throughout most of the past decade; however, instabi- lity in the world economy caused domestic inflation to accelerate in recent years. The pula was revalued on several occasions since 1979 in an effort to reduce the impact on the domestic economy of external price increases. 6. Despite the economy's favorable performance with respect to overall growth and balance of payments and budgetary stability, the mineral led deve- lopment has only modestly increased the number of employment opportunities for Botswana's labor force. Cattle raising and crop farming have remained the main economic activity for about 80 percent of the population. However, an increasing concentration of cattle ownership has effectively reduced the options for about 50 percent of the population to make under prevailing conditions a reasonable living from farming alone. The major challenge in the present decade is, therefore, to provide employment opportunities for Botswana's labor force, which is growing at over 3 percent a year.4 The Government's strategy is to utilize the resources flowing from the mining sector to provide 2Calculated by the Bank Atlas method. 3The Southern Africa Customs Union (SACU), comprising Botswana, Lesotho, Swaziland and RSA, is administered by South Africa. Import duties and excise taxes are levied and collected by South Africa, deposited into a common pool and then distributed to the members based on each country's share in production and trade. 4Reductions in employment opportunities for Batswana in RSA may compound the problem. - 3 - the infrastructure and services required by the more labor intensive productive sectors. These sectors face formidable constraints, and generating a sufficient number of attractive work opportunities will not be an easy task. 7. One of the most serious constraints on growth of the productive sectors is the severe shortage of skilled technical, managerial and profes- sional manpower, which greatly impairs the country's absorptive capacity, encourages the use of capital intensive technology, raises production costs, and stifles investment. A high proportion of skilled and professional positions are filled by expatriates and many posts in Government and the private sector are inadequately staffed. The manufacturing sector is further constrained by the small domestic market, the country's limited raw materials base and landlocked position, and competition from South Africa and Zimbabwe. 8. It is the agricultural sector that is looked upon as the main source for employment. However, at present productivity in agriculture is very low. Crop farming is circumscribed by the limited availability of suitable land, by sparse and erratic rainfall, by lack of draught power and by low farm-gate prices. Appropriate policy changes should help overcome some of these constraints and enhance production and employment. Nevertheless, the sector's ability to support additional labor may always remain limited, as ecological conditions render most parts of the country more favorable to livestock than crop production. Cattle raising, however, does not require high labor inputs. Moreover, the system of communal grazing, the traditional values associated with cattle and, more recently, the granting of substantial subsidies to cattle owners, have given rise to overstocking and progressive land degradation. If sustained, this trend could further reduce the sector's growth and employment opportunities. 9. The Government is moving ahead with programs to deal with these constraints. The Fifth National Development Plan, 1979-85 (NDP V) accords high priority to education, with emphasis on primary education, as a means of alleviating the country s manpower constraint. Industry is being supported through promotional activities by the Botswana Development Corporation and through the provision of tax breaks, preference in bidding for government contracts, favorable interest rates and seed capital for investors. A Tribal Grazing Lands Program (TGLP), with the primary aim of controlling overstocking and range degradation, while at the same time increasing incomes from cattle raising by improving herd quality, enhancing range management and boosting operating efficiency, has been underway since 1975. An Arable Lands Develop- ment Program (ALDEP), a multi-faceted program designed to raise productivity in crop farming, was introduced in 1979. Both ALDEP and TGLP are expected to permit more labor intensive use of the land. 10. Botswana's economic prospects, although bright in macro terms, are clouded by problems of employment and income distribution. Expanding diamond production and exports from the new mine at Jwaneng are expected to continue fueling rapid overall economic growth - likely to average 10 per cent per annum over the 1981-85 period - and to maintain strong balance of payments and public finance positions. Progress is being made in raising the level of skills and broadening the educational base. However, TGLP has not yet been successful in rationalizing government investment and pricing policies in the livestock industry and has focused largely on commercial ranching much to the neglect of improving the productivity of cattle smallholders. The ALDEP - 4 - program is just getting started. Efforts to identify labor-intensive invest- ments will have to be redoubled, however, if the country is to avoid serious unemployment and maintain stable growth. 11. Multi- and bilateral agencies have extended substantial assistance to Botswana on highly concessional terms. More recently, however, loans from international organizations have overtaken bilateral loans in Botswana's external debt. The Bank Group has been the main multilateral source, but the EEC, the African Development Bank and OPEC sources have also been active. Bilateral assistance has come from several sources. In 1978, almost two thirds of Botswana's outstanding bilateral debt was converted into grants. At the end of 1980, total external debt outstanding and disbursed amounted to US$148.5 million, debt service payments were US$11.8 million and the debt service ratio 1.9 percent. Botswana is expected to continue to receive substantial (but probably declining) assistance from bilateral sources on grant or concessional terms; however, given its favorable economic prospects, an increasing proportion of external financing is expected to come from commercial sources. Botswana is expected to remain creditworthy for the required external borrowing. PART II - BANK GROUP OPERATIONS IN BOTSWANA 12. To date, Botswana has received 17 Bank Group loans and credits totalling US$137.4 million (excluding cancellations) comprised of six credits for US$14.7 million and eleven loans for US$122.7 million, including US$3.5 million on third window terms. These loans and credits have financed five road projects, two education projects, two livestock projects, two urban projects, two water supply projects and one development finance corporation project. Three loans, including one for engineering studies, have been for the Shashe mining complex. IFC has had one investment in Botswana, a US$370,000 equity participation in the Botswana Development Corporation (BDC), which was approved in March 1979. Summary statements of Bank Group operations in Botswana are provided in Annex II. 13. The Bank Group's share of Botswana's external debt (disbursed only) at the end of 1980 was about 44 percent (IBRD - 34 percent, IDA - 10 percent) and its share in debt service was about 84 percent. A large part of debt service payments to the Bank Group are for the Shashe mining infrastructure loans of the early 1970s, which are guaranteed by a consortium of interna- tional mining companies. 14. Botswana's performance in planning and executing development projects has been satisfactory. Bank assisted projects have been relatively problem free, with two important exceptions: the Shashe project (Loans 776-1 and 776-2) and the livestock projects (Credit 325 and Loan 1497). Although the infrastructure works for the Shashe mining complex were completed on time, the mining operation has experienced technical and financial problems. The tech- nical problems have been largely resolved; however, despite a second financial restructuring of the mining company,Bamangwato Concessions, Ltd. (BCL), in early 1980, it has continued to experience financial difficulties as a result of low international copper and nickel prices. The Bank's first livestock project has been completed and the credit closed, but many of the original objectives of the project were not fully achieved. Most of the ranches developed under the project continue to be overstocked and poorly managed, control and use of water resources remains inadequate and the extension services have been unable to alter inefficient traditional stocking patterns. The Bank's second project, while successful in improving livestock marketing systems through upgrading of trek routes, holding areas and railway sidings, has not yet been successful in raising offtake rates and increasing beef production, or in alleviating overstocking and range degradation. The Govern- ment is pursuing proposals designed to remedy these problems. 17. Future Bank Group operations in Botswana are expected to include projects in power, urban development, population-health-nutrition, education and possibly agriculture. PART III - THE EDUCATION SECTOR Background 18. Since independence in 1966, Botswana has made great strides in expanding and improving its educational system. From an entirely private, missionary operated system at independence, enrolling 71,500 primary and 1,500 secondary students studying mostly art and literature, the system has evolved to one predominantly public with enrollment of 171,000 primary and 21,000 secondary students (1979/80) and with a curriculum placing more emphasis on science and practical subjects. About 94 percent of the 6-12 year age group was enrolled in primary school in 1979/80 and completion rates were nearly 80 percent. Entry into junior secondary school was available for 38 percent of the 1978/79 primary school graduates. Teacher qualification has also improved significantly since independence, education sector infrastructure has expanded considerably and vocational, technical and non-formal education have grown rapidly. These achievements were largely the result of the high priority accorded to education by the Botswana authorities. 17. Despite these advances, education in Botswana is still deficient in many respects. There remains a serious shortage of physical infrastructure, particularly primary school classrooms, many teachers are under-qualified and there is a high dependence on expatriate teachers. In addition, curricula continue unbalanced in favor of literary subjects and access at all education levels requires improvement. Academic performance has deteriorated in recent years as the system has been unable to maintain quality in a period of rapid expansion. Consequently, an increasing proportion of students each year is inadequately prepared for entry into the next educational level, and school leavers continue to be inappropriately trained to play a productive role in Batswana society. - 6- Education Structure and Administration 18. Formal education in Botswana consists of seven years of primary education, three years of junior secondary and two years of senior secondary school, and various degree, diploma and certificate programs in higher edu- cation offered by the University College of Botswana (UCB). Vocational and technical education are provided by a number of public and private insti- tutions, the major ones of which are: (a) the Botswana Polytechnic, which offers craft and technical courses, including automobile mechanics, civil and electrical engineering and electronics; (b) the Botswana Institute of Adminis- tration and Commerce (BIAC), which offers courses in accounting, adminis- tration, supplies management, clerical and secretarial studies and management for civil servants; (c) the Institute of Development Management (TDM), which offers training for senior management personnel in finance, personnel and related subjects; and (d) the Youth Brigades, which combine training at craft and artisan levels with productive activities, essentially for primary school leavers. Non-formal education is provided by a host of government and other agencies. Over the next several years the Government plans to restructure the educational system with the aim of providing nine years of basic education to all Batswana in the 6-15 year age group. 19. Administrative responsibility for primary, secondary, non-formal vocational and higher education (other than UCB) is vested in the Ministry of Education (MOE), which oversees sector development plans, curriculum develop- ment, teacher assignment and training and system inspection and supervision. The MOE also ensures private school compliance with government regulations and advises local authorities on the professional aspects of education. Each of the country's nine districts and four townships has an elected local education authority, with responsibilities related to school construction and mainte- nance, the provision of school equipment and materials, the posting of teachers and other administrative matters. The Rural Extension Coordinating Committee, an inter-ministerial body under the aegis of the Ministry of Finance and Development Planning, coordinates the non-formal education programs of the various ministries and agencies. Education Objectives, Strategy and Policy 20. Botswana's educational objectives, as formulated by the 1977 National Commission on Education and outlined in NDP V are: (a) to increase educa- tional opportunities and reduce inequities in access to education; (b) to contribute to balanced economic development by seeking to satisfy manpower requirements in all sectors, particularly in rural areas; (c) to promote personal qualities such as respect for national ideals, self-reliance and concern for others, and to encourage full development of individual talents; and (d) to expand the role of schools and colleges in the local communities and vice versa. Within these general objectives, NDP V accords priority to achieving universal primary education, improved and more equitable access to junior secondary education and to qualitative improvement in primary and secondary education. These areas have not been fully addressed in previous years because of the emphasis given to vocational and technical education to meet urgent manpower needs. - 7 - 21. The Government plans to provide seven years of universal primary edu- cation by the mid-1980s, to significantly improve the quality of primary education within that same time-frame, and by 1990, to provide nine years of basic education to all children aged 6-15 under a restructured 6 + 3 + 3 system. This will require the construction of about 2,270 primary school classrooms (400 to 500 per year, plus ancillary facilities) to reach the Government's 1985 target of 80 percent class coverage, which will still leave many classes on double shifts or in the open air. More rapid progress is hampered by the lack of implementation capacity in some districts. An increased supply of qualified teachers and improved qualification for existing teachers would also be required for achievement of the Government's medium term goals. 22. Recent expansions at the three existing primary teacher training colleges (PTTC), together with the new college included under the proposed project, should reduce the deficit of trained teachers from 36 percent in 1979 to 25 percent in 1985. In addition, the expansion of rural education centers providing in-service training, the requirement that PTTC candidates serve a probationary year as teachers prior to entering college and the recruitment of senior secondary graduates to the teacher ranks to fulfill their period of compulsory community service is expected to help alleviate the shortage of teachers and further improve teaching quality, especially in rural areas. The USAID financed Primary Education Improvement Project will provide major institutional assistance to the training of PTTC staff, primary school head teachers and primary school inspectors. A Department of Primary Education will be established at UCB and will provide support to the PTTCs by assisting in updating primary school and PTTC curricula and by improving teaching methods. The MOE will increase the quantity and quality of teaching aids and learning materials available to the schools. 23. Improved organization and administration of primary education will also be required as the Government's plans evolve. The Government also plans to restructure the secondary education system and has instituted programs directed towards improving the quality of private community junior secondary schools and establishing new ones financed jointly by government and local communities. A limited senior secondary school expansion program is underway to meet the increased demand resulting from increased junior secondary enroll- ment. Overall, an additional 9,000 junior secondary and 900 senior secondary school places will be provided during the NDP V period. These increases will enable 50 percent of primary school graduates to progress to junior secondary, as against the present 38 percent, but given the expected large increase in junior secondary graduates, will reduce the progression rate to senior secondary school from 34 percent to about 29 percent. This policy should, however, substantially strengthen basic education, particularly in mathematics and the sciences, and eventually contribute to better-prepared students entering higher education and to increasingly educated and skilled manpower. 24. Meeting the targets for increased enrollments, better teachers and less reliance on expatriates will require a substantial effort in training secondary school teachers. It is estimated that about 350 new teachers will be needed in the 1979-85 period just to meet increased enrollments, with another 115 Batswana teachers required to reach the Government's goal of - 8 - reducing the proportion of expatriates from the present 70 percent to 38 percent by 1985. The degree-level intake at UCB has been increased, the African Development Bank (AfDB) is expected to finance a junior secondary teacher training college and training programs for practical subjects are being developed. The Government also proposes to increase its financial support to the Community Junior Secondary Schools by paying part of the salaries of expatriate teachers and by providing allowances to cover the cost of textbooks and materials. It also plans to provide increased professional and technical services to these schools. 25. The early 1980s will be a period of consolidation for the University of Botswana, with enrollment expected to grow by only seven percent a year, compared with 18 percent in recent years. Plans for this period include introduction of programs to train tutors for the PTTCs and for head teachers and inspectors. The University also expects to introduce a one-year post- graduate course in education and, through its Institute of Adult Education, hopes to stimulate interest in and develop links between adult education and productive activities. With these programs the University is expected to make an important contribution to upgrading the nation's manpower. By 1985 when the joint college arrangements between Botswana and Swaziland are expected to end, UCB will have been upgraded to full university status. 26. Technical and vocational education are being expanded in the NDP V period, but with emphasis on making existing programs more effective in meeting the country's manpower needs rather than on maximizing their growth. Additional expatriate staff will be employed in conjunction with a staff deve- lopment program that will geek to identify a local counterpart for each expatriate appointment. The role of the Brigades is currently under review by the Government, and it appears that some may be turned into rural trade schools, others may be more heavily subsidized to increase their effectiveness and still others may remain autonomous, though with some assistance from various branches of the Government. Non-formal education programs are expected to stress literacy (with a national campaign aimed at enrolling 15,000 participants annually), district and village level skill training and greater learning opportunities for women. Education Finance 27. Basic education in Botswana is financed largely from general tax revenues. Primary education is free for all students; however, at the secondary level, fees are charged ranging from P 120 (US$154 equivalent) per annum per student at public school to P 220 (US$282 equivalent) per annum per student at private schools. 28. Recurrent expenditures on education programs administered by MOE represented about 20 percent of total Central Government recurrent expenditure in 1979/80, having risen at an annual rate of about 15 percent in real terms since 1976. More than three-fourths of these expenditures were directed towards primary and secondary education. Capital expenditures on education (including those financed by external donors) also increased rapidly during this period and by 1979/80 had reached 15 percent of total Central Government capital spending. Slightly over one-half of these expenditures were - 9 - administered by MOE and the remainder by the Ministry of Local Government and Lands, which is responsible for the primary school construction program. Total public expenditures on education and training rose from 5.2 percent of GDP in 1976/77 to an estimated 6.3 percent in 1979/80. 29. Under the NDP V, recurrent expenditure on education is expected to remain at about 20 percent of total Central Government recurrent expenditure, rising by about 10 percent a year in real terms. Even with this rate of expenditure growth, some of the objectives of the Plan, such as localization of teachers and achieving nine years universal basic education, may not be reached within the allotted timeframe. Capital expenditures on education are expected to continue rising sharply through the Plan period, although they may be circumscribed by the country's limited capacity to implement projects. Bank Experience and Strategy in the Sector 30. The Bank Group has assisted in the development of Botswana's educa- tion and training sector with two loans totalling US$20.5 million equivalent. The first education project (Loan 1274-BT/1275-T-BT, May 1976) provided US$10.5 million to: (a) increase the number of secondary school places by 30 percent; (b) provide additional secondary school teachers; (c) expand adult education programs; (d) assist in expanding the Youth Brigade programs; and (e) provide a rural multipurpose education center (Matsha Community College) to serve the western Kalahari area. The second project (Loan 1828-BT, April 1980) provided US$10.0 million for: (a) classrooms and ancillary facilities for about eleven community junior secondary schools; (b) construction of about seven new community junior secondary schools; (c) assistance to about 16 Youth Brigade Centers; (d) additional training facilities at the Botswana Institute of Administration and Commerce and the Institute of Development Management; and (e) technical assistance. 31. Implementation of both these projects is proceeding satisfactorily, although the first project encountered initial delays, particularly with regard to the Matsha Community College. Staff constraints in the Project Implementation Unit and the inability of the Ministry of Works and Communica- tions to provide technical services as planned were the main causes of the delays. There was also a need to strengthen the mechanism for evaluating the Brigades program. These problems were addressed in the second project, and project implementation has improved. The proposed Third Education Project incorporates all of these lessons in its design and provides technical assistance funds to ensure continuous services of a project director and to strengthen the auditing capacity of the MLGL and the District Councils. 32. The Government's policies and priorities for educational development are sound and meet Bank criteria for assistance to the sector. Secondary and vocational/technical education are being addressed in both the First and Second Education Projects, as well as in projects supported by bilateral and other multilateral donors. Botswana's needs in primary education are substantial and critical to the development of an educated and productive man- power supply. By helping to provide additional primary school classroom and ancillary facilities in heretofore educationally disadvantaged areas and by making available facilities for training additional primary school teachers, the Bank is playing a crucial role in assisting Botswana in carrying out its education sector strategy. - 10 - PART IV - THE PROJECT 33. The proposed project was identified in November 1980, prepared by the Government with Bank Group assistance in January/February 1981, and appraised in March 1981. Negotiations were held in Washington in September 1981. The Government delegation was led by Mr. 0. K. Matambo, Director of Economic Affairs, Ministry of Finance and Development Planning. A Staff Appraisal Report (No. 3549-BT, dated October 1, 1981) is being distributed separately. Project Description 34. The project would assist the Government in carrying out its five-year educational program as set forth in the education and manpower chapter of NDP V, and would consist of: - constructing, furnishing and equipping about 500 primary school classrooms and related facilities (including offices, storerooms, cooking and ablution areas and staff houses); - supplying about 200,000 primary school level textbooks and teachers guides; - constructing, furnishing and equipping a. primary teacher training college for about 300 student places; - providing of about 14 man-years of specialists services, consisting of a project director/architect (about five man-years) for the PIU and three accountancy specialists (about nine man-years) to assist the Ministry of Local Government and Lands and the Districts. 35. Primary School Classrooms - The primary school classrooms and related furnishings and facilities provided under the proposed project would represent about 22 percent of the number required to enable the Government to reach its target of meeting 80 percent of assessed needs by 1985. Sites for these classrooms would be selected on the basis of agreed guidelines, which ensure equity within and between Districts. Most of the classrooms would be sited in rural areas. Modest staff housing would also be provided under the project, since a critical shortage of housing exists in rural Botswana and it is unlikely that teachers could be recruited and maintained in the schools without housing. 36. Primary School Textbooks - The project would assist in financing an initial supply of elementary level math, English, Setswana and social studies textbooks in support of the new primary school curriculum being developed by the MOE with the assistance of USAID and other donor agencies. - 11 - 37. Primary Teacher Training College (PTTC) - To assist the Government meet the need for trained primary school teachers until year 1990, the proposed project provides for a new PTTC to be located at Tlokweng, a rural area near Gaborone. The proposed PTTC would provide for 300 places, raising total capacity for primary teacher training in Botswana by one-third,to 1,200 places, and increase annual output of trained teachers by 150, to 600. This is consistent with primary school enrollment projections and with plans for upgrading under-qualified primary school teachers. Moreover, the new PTTC would be an integral component of a comprehensive plan to provide trained teachers, incorporating the efforts of the various departments of UCB, including the Departments of Primary and Special Education and the Primary School Laboratory. The Department of Primary Education at UCB is being assisted by a USAID grant for a primary education improvement project that will train the necessary tutors for this PTTC. The site selected for the new college is close to the UCB and adjacent to an eleven classroom primary school that would provide opportunities for teaching and in-classroom training for the PTTC's students. 38. Technical Assistance and Professional Services - Five man-years of technical assistance to provide for continuation of the PIU's project director are included in the project. This will enable the PIU, which is administering the First and Second Education Projects, to maintain its effectiveness until completion of the proposed Third Education Project. In addition, nine man- years of assistance is included to provide the services of three specialists in acccounting to help strengthen bookkeeping and cost control within the District Councils and the MLGL. Each specialist would be assigned a local counterpart, who would be trained to carry on the work after the specialist's departure. About 100 man-months of architectural and engineering services would also be provided. The qualifications, experience and terms and conditions of these specialists would be satisfactory to the Bank (Section 3.03, draft Loan Agreement), and they and their counterparts would be appointed and in place as a condition of disbursement of the primary school classroom component (Schedule 1, paragraph 4, draft Loan Agreement). Female Participation in the Education System 39. In 1980, 55. percent of the total enrollment in primary education was female; in secondary education 56 percent of enrollment was female; and in higher education 33 percent of those enrolled were women. Higher female participation rates in primary and secondary school are attributed to the custom of young males herding cattle during school hours. The proposed project would improve educational opportunities for all students. Project Cost and Financing 40. Total project cost is estimated at US$30.0 million equivalent, including taxes estimated at US$0.8 million equivalent. The proposed loan of US$20.0 million equivalent would cover the foreign exchange component, representing 68 percent of total project costs net of taxes. The balance of the total project cost, US$10.0 million equivalent, including taxes, would be financed by the Government. - 12 - 41. Cost estimates for the civil works, furniture and equipment were derived from a review by Bank staff of data provided by (a) the Ministry of Works and Communications, from its activities in the building industry; (b) the PIU, based on its experience in recent contract awards under the First and Second Education Projects, and (c) MLGL, based on its experience in super- vising primary classroom construction in the districts to be involved in the proposed project. The average unit base cost (October 1981 prices) of constructing the primary classroom facilities is US$200/m2 equivalent, with costs ranging from about US$159/m2 to US$278/m2 equivalent, depending on the remoteness of location. These costs compare favorably with those experienced recently in other African countries: Lesotho (1981) US$214/m2, Swaziland (1979) US$160/r2, Kenya (1979) US$190/m2, Mauritius (1978) US$273/m2. The classroom facilities, furniture, etc. are austere in design and would make maximum use of local materials and simple building techniques. 42. The cost estimates for textbooks were prepared in conjunction with MOE and the Government Printing Agency, and the cost of the technical assistance component, about 168 man-months of specialists services, estimated at about US$3,600 per man-month is based on past and on-going experience. Professional services in architecture and engineering, about 100 man-months, are estimated to cost about US$6,400 per man-month, including salary, overhead and fees, which is in line with recent experience. For physical contin- gencies, 10 percent has been added to the base costs of civil works and professional services and 5 percent to the base costs of furniture, equipment and textbooks. Price contingencies have been applied from the base date (October 1981) at the following annual rates: 1981 1982 1983-87 Foreign/Local 12.0% 11.0% 10.0% These contingency allowances are based on Bank experience in similar projects for physical works and on the Bank's projections, agreed to by Government, of inflation rates in Botswana and South Africa for prices. As most of Botswana's imports originate in South Africa and inflation rates have been very similar in the two countries, foreign and local price increases during the project implementation period are expected to be the same. Project Implementation 43. The project would be implemented over five years. The project Implementation Unit established in the MOE to implement the First and Second Education Projects would undertake the administrative functions for the proposed project. It would also be responsible for coordination of the various ministries and departments involved in the project, including the MLGL. Incremental operating costs for the Unit are provided for through 1985 under the Second Education Project. The PIU is operating well and its key staff have the necessary capabilities and experience. Any appointments to the positions of project director, architect and procurement manager would be satisfactory to the Bank (Section 3.02, draft Loan Agreement). - 13 - 44. The MLGL would be responsible for administration of the construction of the primary school facilities; however, it would delegate actual imple- mentation of this component to the nine district councils. Administrative arrangements and procedures to carry out this work are well established and have been used successfully in the past for similar type operations. The MLGL would review work plans and cost estimates provided by the districts and, after approval, allocate the necessary funds to the districts. The MLGL would provide the Bank through the PIU: (i) before the beginning of each of Botswana's fiscal years, a work plan and budget satisfactory to the Bank for the construction of primary school facilities, and (ii) an annual report comparing actual work completed with that planned (Section 3.06, draft Loan Agreement). Detailed supervision of construction contracts would be the responsibility of the districts, for which both MLGL and MOWC would provide assistance as required. The Councils would be financially accountable to MLGL, which maintains an audit department to ensure adequate control over the use of funds. Since there is a shortage of qualified financial staff in the MLGL and the Districts, the project includes nine man-years of technical assistance for three accountants to ensure that proper accounts are maintained and to train MLGL and District personnel (para. 38). Reporting and Evaluation 45. Semi-annual reports on project implementation would be submitted to the Bank for review no later than two months after the close of each period (Section 3.08(b) iii, draft Loan Agreement). Within five months after the loan closing date, the PIU, with the assistance of the MLGL and MOE, would provide the Bank with an evaluation report covering all aspects of the project execution, including lessons learned during implementation (Section 3.08 (d), draft Loan AgrPement) Procurement 46. Contracts for civil works, furniture and equipment are expected to total US$27.9 million. About US$15.7 million of this will be procured through international competitive bidding under World Bank guidelines. Many of the classroom construction, furniture and equipment tenders will likely to be too small to attract international suppliers, however, though these will be grouped to encourage their participation. It has, therefore, been agreed with the Government that civil works contracts for classrooms and ancillary faci- lities below US$250,000 (about US$11 million with contingencies) and for furniture and equipment below US$50,000 (US$1.2 million with contingencies) may be awarded by competitive bidding advertised locally and in accordance with procedures satisfactory to the Bank (Schedule 4, Section C, draft Loan Agreement). It was also agreed that textbook contracts, totalling US$500,000 including contingencies, will be negotiated directly with the Teaching Aids Production Unit, the Government Printing Department and local textbook firms. 47. Sketch designs, draft tender documents and master lists of furniture, equipment and textbooks indicating proposed grouping and cost estimates would be reviewed by the Bank. Again, items would be grouped to the extent practicable to encourage competitive bidding and permit bulk procurement. Review of tender evaluation documents prior to award would be required for - 14 - textbooks contracts and contracts above US$250,000 for civil works and US$50,000 for furniture and equipment (Schedule 4, Section D, draft Loan Agreement). With ICB domestic manufacturers of furniture and equipment would be given a preference of 15 percent or the existing applicable rate of import duties, whichever is lower, over the c.i.f. price of competing foreign suppliers. Disbursement 48. Disbursements would be on the basis of: (a) 63 percent of expend- itures for civil works; (b) 100 percent of foreign expenditures for directly imported furniture, equipment and textbooks; (c) 90 percent of local expend- itures for locally manufactured furniture, equipment and textbooks; (d) 90 percent of expenditures for technical assistance; and (e) 80 percent of expenditures for imported but locally procured furniture, equipment, textbooks and professional services. All disbursements would be fully documented. 49. Retroactive financing not exceeding US$150,000 for approved expend- itures incurred after November 1, 1981 and prior to loan signing would be allowed for architectural services and civil works for the PTTC (Schedule 1, 4(a), draft Loan Agreement). Auditing 50. All project expenditures would be audited yearly by auditors acceptable to the Bank. The accountancy specialists provided under the tech- nical assistance component (para. 39) would assist in preparation of the MLGL and district accounts. The PIU would be responsible for the remaining accounts. With respect to the primary school components, unaudited financial statements would be submitted to the Bank not later than six months after the end of each fiscal year, followed with audited statements within twelve months after the year ending March 1983, within nine months after the year ending March 1984 and within six months after subsequent years. Audit reports for the remainder of the project would be submitted to the Bank within six months of the end of the Borrower's fiscal year (Section 4.02(b), draft Loan Agreement). Benefits and Risks 51. The proposed project would support the Government's priorities of expanding educational opportunities and improving the quality of primary education, particularly in rural areas. 52. No special risks are foreseen. Technical assistance will strengthen the accounting practices of the MLGL and the districts and train counterparts to ensure continuing sound accounting practices. Three of the nine districts may have difficulty in implementing their primary school construction programs within the proposed time schedule. However, SIDA assistance is expected to strengthen administration in these districts. In any case, the matter would be closely monitored during project supervision. - 15 - PART V - LEGAL INSTRUMENTS AND AUTHORITY 53. The draft Loan Agreement between the Government of Botswana and the Bank and the Report of the Committee provided for in Article III, Section 4 (iii) of the Articles of Agreement are being distributed to the Executive Directors separately. 54. Special conditions of the project are listed in Section III of Annex III. 55. I am satisfied that the proposed loan would comply with the Articles of Agreement of the Bank. PART VI - RECOMMENDATION 56. I recommend that the Executive Directors approve the proposed loan. A. W. Clausen President Washington, D.C. October 29, 1981 ANNEX I -16 - Page I of 5 TABLE 3A BOTSWANA - SOCIAL INDICATORS DATA SHEET BOTSWANA REFERENCE GROUPS (WEIGHTED AVERGES LAND AREA (THOUSAND SQ. KM.) . - MOST RECENT ESTIMATE)- TOTAL 570.0 MOST RECENT MIDDLE INCOME MIDDLE INCOME AGRICULTURAL 453.6 1960 /b 1970 /b ESTIMATE /b AFRICA SOUTH OF SAHARA LATIN AMERICA 6 CARIBBEAN SNP PER CAPITA (USj) 80.0 160.0 722.0 794.2 1616.2 ENERGY CONSUMPTION PER CAPITA (KILOGRAMS OF COAL EQUIVALENT) .. .. 426.9 707.5 1324.1 POPULATION AND VITAL STATISTICS POPULATION, MID-YEAR THOUSANDS) 524.0 634.0 773.0 URBAN POPULATION (PERCENT OF TOTAL) 1.8 8.4 26.6 27.7 64.2 POPULATION PROJECTIONS POPULATION IN YEAR 2000 (MILLIONS) 1.5 STATIONARY POPULATION (MILLIONS) YEAR STATIONARY POPULATION IS REACHED POPULATION DENSITY PER SQ. KM. 0.9 1.1 1.3 55.0 34.3 PER SQ. KM. AGRICULTURAL LAND 1.2 1.4 1.6 130.7 94.5 POPULATION AGE STRUCTURE (PERCENT) 0-14 YRS. 45.9 48.7 49.9 46.0 40.7 15-64 YRS. 51.4 48.5 47.4 51.2 55.3 65 YRS. AND ABOVE 2.7 2.8 2.7 2.8 4.0 POPULAIIUN GROWTH RATE (PERCENT) TOTAL 1.7 1.9 2.8 2.8 2.4 URBAN 17.9 17.6 15.0 5.1 3.7 CRUDE BIRTH RATE (PER THOUSAND) 49.9 50.6 50.9 46.9 31.4 CRUDE DEATH RATE (PER THOUSAND) 24.1 20.1 16.7 15.8 8.4 CROSS REPRODUCTION RATE 3.2 3.2 3.2 3.2 2.3 FAMILY PLANNING ACCEPTORS, ANNUAL (THOUSANDS) .. .. 11.3 USERS (PERCENT OF MARRIED WOMEN) .. .. FOOD ANI) NUTRITION INDEX OF FOOD PRODUCTION PER CAPITA (1969-71-1QO) 91.0 96.0 91.0 89.9 108.3 PER CAPITA SUPPLY OF CALORIES (PERCENT OF REQUIREMENTS) 86.0 87.0 94.0 92.3 107.6 PROTEINS (GRAMS PER DAY) 70.0 71.0 74.2 52.8 65.8 OF WHICH ANIMAL AND PULSE 32.0 35.0 36.4 16.1 34.0 CHILD (AGES 1-4) MORTALITY RATE 36.1 28.4 21.9 20.2 7.6 HEALTH LIFE EXFECTANCY AT BIRTHi (YEARS) 39.9 44.9 49.2 50.8 64.1 INFANT MORTALITY RATE (PER THOUSAND) .. 97.O .. .. 70.9 ACCESS TO SAFE WATER (PERCENT OF POPULATION) TOTAL .. 29.0 45.0 27.4 65.7 URBAN 71.0 95.0 74.3 79.7 RURAL .. 26.0 39.0 12.6 43.9 ACCESS TO EXCRETA DISPOSAL (PERCENT OF POPULATION) TOTAL .. .. .. ., 59.9 URBAN .. .. .. ., 75.7 KLRAL .. .. .. ., 30.4 POPULATION PER PHYSICIAN 26200.0 15463.4 9597.0 13844.1 1728.2 POPULATION PER NURSING PERSON 2380.0/c 1250.5 1270.0 2898.6 1288.2 POPULATION PER HOSPITAL BED TOTAL 514.2 381.9 331.8 1028.4 471.2 URBAN .. .. 76.5 423.0 558.0 RURAL .. .. 3815.4 3543.2 ADMISSIONS PER HOSPITAL BED .. 15.3 27.0 HOUSING AVERAGE SIZE OF HOUSEHOLD TOTAL .. .. 5.0 URBAN .. .. 4.8 RURAL .. .. 5.0 AVERAGE NUMBER OF PERSONS PER ROOM TOTAL .. .. URBAN .. .. RURAL .. .. ACCESS TO ELECTRICITY (PERCENT Of DWELLINGS) TOTAL .. 9.0 URBAN .. .. RURAL .. .. - 17 - ANNEX I Page 2 of 5 TABLE 3A BOTSWANA - SOCIAL INDICATORS DATA SHEET BOTSWANA REFERENCE GROUPS (WEIGHTED AVEBGES - MOST RECENT ESTIMATE)- MOST RECENT MIDDLE INCOME MIDDLE INCOME 1960 /b 1970 /b ESTIMATE lb AFRICA soUTH OF SARA LATIN AMERICA & CARIBBEAN EDUCATION ADJUSTED ENROLLMENT KATIOS PRIhARY: TOTAL 42.0 66.0 916,0 73.7 101.7 MALE 35.0 62.0 80.0 96.8 103.0 FEMALE 48.0 70.0 98.0 79.0 101.5 SECONDARY: TOTAL 1.0 7.0 20.0 16.2 35.3 MALE 1.0 8.0 19.0 25.3 34.9 FEHALE 1.0 6.0 21.0 14.8 35.6 VOCATIONAL ENROL. (X OF SECONDARY) 4.0 19.0 12.0 5.3 30.1 PUPIL-TEACHER RATIO PRIHARY 31.0 36.0 31.0 36.2 29.6 SECONDARY 12.0 15.0 17.0 23.6 15.7 ADULT LITERACY RATE (PERCENT) 20.0/d .. 35.0 .. 80.0 CONSUMPTION PASSENGER CARS PER THOUSAND POPULATION 2.0 2.8 4.7 32.3 42.6 RADIO RECEIVERS PER THOUSAND POPULATION 4.0 31.5 86.5 69.0 215.0 TV RECEIVERS PER THOUSAND POPULATION .. .. .. 8.0 89.0 NEWSPAPER ("DAILY GENERAL INTEREST") CIRCULATION PER THOUSAND POPULATION .. 20.5 24.0 20.2 62.8 CINEMA ANNUAL ATTENDANCE PER CAPITA .. 0.1 0.2 0.7 3.2 LABOR FORCE TOTAL LABOR FORCE (THOUSANDS) 266.9 296.3 338.1 FEMALE (PERCENT) 49.9 52.7 53.0 36.7 22.6 AGRICULTLRE (PERCENT) 92.0 86.7 83.0 56.6 35.0 INDUSTRY (PERCENT) 2.7 3.7 5.0 17.5 23.2 PARTICIPATION RATE (FERCENT) TOTAL 50.9 46.7 43.7 37.2 31.8 MALE 53.2 47.7 44.5 47.1 49.0 FEMALE 48.9 45.9 43.1 27.5 14.6 ECONOMIC DEPENDENCY RATIO 1.0 1.1 1.2 1.3 1.4 INCOME DISTRIBUTION PERCENT OF PRIVATE INCOME RECEIVED BY HIGHEST 5 PERCENT OF HOUSEHOLDS .. 28.1/e HIGHEST 20 PERCENT OF HOUSEHOLDS .. 60. 37 . LOWEST 20 PERCENT OF HOUSEHOLDS .. 1.67 . LOWEST 40 PERCENT OF HOUSEHOLDS .. 7.6T . POVERTY TARGET GROUPS ESTIMATED ABSOLUTE POVERTY INCOME LEVEL (USS PER CAPITA) URBAN .. .. 294.0 381.2 RURAL .. .. 217.0 156.2 187.6 ESTIMATED RELATIVE POVERTY INCOME LEVEL (USS PER CAPITA) URBAN .. .. 245.0 334.3 513.9 RURAL .. .. 245.0 137.6 362.2 ESTIMATED POPULATION BELOW ABSOLUTE POVERTY INCOME LEVEL (PERCENT) URBAN .. .. 40.0 RURAL .. .. 55.0 Not available Not applicable. NOTES /a The group averages for each indicator are population-weighted arithmetic means. Coverage of countries among the indicators depends on availability of data and is not uniform. /b Unless otherwise noted, data for 1960 refer to any year between 1959 and 1961; for 1970, between 1969 and 1971; and for Most Recent Estimate, between 1976 and 1979. /c 1962; /d Prior to 1965; /e 1971-72 economically active population. May, 1981 - 18 - ANNEX I Page 3 of 5 EFIN111ON1S OY SOCIAL INDICATORS Net Os A, -icegD n data ore drawn fret sources generally jooged the nest oenhorinatlne and reliable l shou ld al.o be noted than they Day rec be inter- nationally ceeponshie hecoose of the lack of standardised defiotetons snd rercepts ased by diff-erent eountrie in eollsctirg che data Tho d e are, none- ehoirne senful to decrtbe ereero of noenfade.i Indiraite treeds, ond eh-rsterDi-e e-rtoie rjaor differences between eounnroes The reFerence group- one (I) oh ea*se coontEy group of the subjeer country and (2) o etourey group vith somswhat higher avereae iocen b th ce ce-try greap of the sobject coontry (eneept for Caritol Darplus Oil Eriponers- groop here "Middle I[oos forth Africa eed Diddle Es.t' ii shtoew beaus- ef strenger neoo-eelttroi afftnities) InDrtne referenee geeop data the averageers yrepiopltton wteighted airihaeeie sears foe each indicator ond shown only ohmn staloriny of Ehe cocorries inoogroup hae dare fer that indieater. Sinee the cooerage of rountrieseerong the indictorsrr dcperds e'. thesesailabilltoy ef doat and isnoetuniforn,caotionntusthberaeteised inrelatingoeoersges of oneindicatoerneoanther. Theseorverntet areeonlyuoefclineccpanlnothrclea:cco ene irafuatno at.a tine aseong ccheeorntry end referer.cr greoups. LAhD AldE frbennand .7.6ki1 Peytlnnienfo-r Iho.peIol ted -htol a, and rural - Pcdlairnd (t.cohl Total1 - Tenof sorfaee anra eepr Sing bond area ond inland woters urban, and r.ral) dinidod by thier retycep iur na-bhe of ho-,i,ail bedr d ..p.tc ol - Eninae of ogricoltural ares used rpe.oreily or perm.nenn.ly -avalable an pril cnd prinace gtteral and tpecioiioed hoypEol1 tad re- fer -repa pantures market -nd kitcher gatdens er to lie follow 1978 data. habiltaion cerrers Hs. fpitals are tsrablish=ents yarnnent ly scaffnd hy ot Inse t eno yhysieo- E-tblifnh-nt proidieg prircipoIly -_ste CNP PER CAPITA (L'S) - GNP per capits es-ti .ste .s.t cr.rent errket prices, cal- dio1 ecarn cr p hyitlded. ERnal he-Pitlrs, .eaner, icclude hea1th noianed by cane conveesieonrenhod as W'orld Dank Atlas (1977-79 basi); 1960, and medical cetters rot per-aosertly etaffsd by a pnytcio b (hbe by 1971 and 1979 dots cedical asnintant droen ift lnn.) h=itb eFtar Linie oot satese- datfen and prenidesIirtied rang of ned icl foelSes e rts LENRCY CONSnribTbdN PER CAYfTA - Apnoal eoesonpcion of coneretiI erery (toal tical porposes urbar hospitals inclods iDt peinnipel/gnnorsl hesptsa, and lienite, pereieam natural gos and hydro- nuclear and geothersal elee- and rural hnpitathi loeal or rural hespnteis eod nedical sod =ternity tricity) iD keiegra=. ef epai eqona.lent per e-pita; 1960, 1970, end 1979 eenters Spscialized hespltalsa=e included o,,ly urde cr 0. dota- Adaisairs Per DnHeRL td - TDeal n-abkr ef ad=isoiots tc er discharges fror hospitals dfivded by the omber cf bads. POPULATIONlAND V1TAL STAT STICS Tonal Penlatfon. ttid-Yeor (thousond!) - AS of July 1; 1960, 1970, and 1979 HOUSING d-c. oorg ieo oablfIose e osbh) .. etl, crbo. and -erat- arioa u'atn (ert of t lal) - Ratci of orbar re rotol popolation; A household eonsines of a group ef individual vho share licing quters diffreret definitinrs of urban anwas cap affect eomparabiliny nf date and their mete meals. A bharder en lodger nay or say non bh incluedd it otungceountries; 1960, 197D, and 1979 dat. thr hoasehold for startistial purpose. Porulatton toiyear D000 - Cunreet popolation projects eo are based o1980 hon lf arbern persroons En altoa. and ruraI oecupied connonciorl coenl population by age ond -en ord their rortalytp sod ferlilily raes dwellings, repentie-ly. Dwelliogs exclde.or-rern-nenn ntructures sod Projertion poesnerere for mprtality rantes onprise of rhree lenels assue- enanospied paels, mtl tip0 -nfera-y at birth inastngwth - oeey's Per nspcn itocon Aceesn Elecnritn lvree f dnellit,eel- -.1(,yf _--yy,,od nata - letei, acd f le life e-pectany strbitetne an 77.5 ypea. The pa.ne. Co-nventioal dnt7ingn wirh ei eceninoty Sr living qoancers nf pfetne g retern foo fertility rate also have thins Is.els assuri deolie in of total, urban and -oral dnellingtrespecnively. fertilytr according no noose leve and pant faeiiy planting perform -nne Eacl country is then assigned OnE of these nine e-ebi-tirone of EornCitTy IDOCiTIOON and fe-ntliry trend for pr-jec-i- porpase. Adlennedfoime Et Inanearfoutieir-ei snot tatinDary poplatir there is no gronnh oee i.s.n shol-total. sale and fasale - Iroen tentl, role and fene=l the birth none is equal ta the d-ath rate, sod also the age structrae re- enrotlse.r of all ogre an the rninacy lenel an pereenrages of nesrectine raiEs conntant This iE achiened onty after fertility rates decline no primary nchool-sge populations; noralDy incflude childre. aged h6-11 th rneplacehntn levelof u I rnetreprnd-tio- r-ee hen.eah generoion vesrs butadjsted for diffe-eo l"n""hnofprinaryeducation;Ftr no so=en rry..n.n .tsrlf ex-tly. _Th stanionary populanion sloe oat eour ies with unilerset odeuatio etnell=ent tsyacy red I01 percrct eati eaned 00 the bhsin of the protected chsraceteristics of nhe population sine osoe popils ase below or above the official school age on he year 2000, and the rae f declie of fertiliy rateto replae- Seconda hor l -total,aileand feala - Computd a aboe;seo- dry Jeot loel. education req1uiens eant fo-r yearn of appruned prisary inntr,ction; neatrstonlonery pop ation ni reached - The year when sant.oiary popolation ptovidt- georrat. noosnfonal her t trsion 's-tCu- tti.. for I.,il sirbnhn eched. .snIlyftlo7 ysr f -a o;ooneporden-e-ose.nn genera.0 Populetic feesito excluded. MiOe.la.-Od-yeorP, pepuanteo per sqore kilon.te lilt0 hectn-l- of Voati_oo ... e lr_ltre _percrn o onod - lOne.n.ene icet irett... noni area; 1960, 1970 end 1979 data. ioral indsnrli,l or enher prognaws ohich operate tidtpend- Per sn km. agricultural land - Ceapated as above for agrlisltural land enely or as departeente of ae-ondary itsitonione. Only; 1960. 970 sod 1978 dan.t Pu-il-teacher rntio - oit,ery, sod s -ondary - Total studentss nolled if Pepulatio- As. Structure frerenl - Children (0-14 years), norking-age (15- pritary and secondary lenls ditidrd by nssb-rs of teachers to the 64 years), and retired 5 yrears a rse peroetges of eid-yerr popu- eorresponding Denels Istooi 1960, 1970, end 1979 dana. Adult 1leersod rote learoern) - LitenAEe adulon (sble co read and crite) PoRplattio mGonth Oats _(erc.t) - tofal - Innool growth cares of total eid- ass percentage of total adelt popylation aged 15 years asd oer year p.polatiors for 1950-60, 1960-70, and 197O-79 aepulanion Growth Rate (p-rert- - ao-Aual growth rams of lb.an ppop- CONSD7dPTION laclon for 1950-60, 1960-70, asd 1970-79. Pssenger Cars (Pe thousard prpulation) - P..seeger earn cesprise ronor Crude Brh Rste (per thoosand) - Antual livo birthn par thossond of rid-year cars seating less nh-r eighn persnoe; excludensoablancen. hearneed al ypoIlatien; 1960, 1970, and 1979 data, ilitary vehicles Cso Dn ath Date (er htousand) - A-Duai deoths per thousands of =id-year Radio Reci-vers (P-r thound relotion) - All nypen of rereers for radio poyupltion; 1960, 1970, sod 1979 data. broadc.ssr no general ppblic per thoosand of ppoplation; ejeledesoo- Lcss eAveradn n e ge wher of d.oghtera v Iomn vi bear In licensed neo-iners it coentries and it yearn =hen reginrenion of rodio her normal reproductioe peiTod if she experiences present age-specific fer- sets owe it effect; desa for Ie__nt years may not be cooparable sites tol my races; ustally f ce-year Lneroges ending in 1960, 1970, aod 1979. mas coontries abolished litenstsg. Farily Plannino -horeenorn. aetnuat frbrasanda) - innoal nonhee of accepeors T' lecetrere (perrthousand cnc1lsbco-)- n rece.iers for broadcosn to of birth-control de-ices -nd-r ua-pices of nanienaI feily planning program fenerol public per thou.sad pepolacio-; earludes olit .resed nt L recoern F.ailylannlng-Users fler.rsi of married -r,n) - Perceonato of maror.d inr ontries aed in years when r-gistration of TV setswas in effert- ocee of ehild-h_Irigrage (n1-44 years) who use birtb-control dvicess to Nassrsr Circolation (rnr thosand populatio-) - Shoos the aornage ire- s11 mmrried wo-en in some age group. olanion of "daily general in.terest nI spapar", defneod a,a perliodrel publication devoted primairily ee recendiog genrerl ores. In is considered FOOD AND NUTRIT1ON to be "daily" if it appeare an leat four Eires a eek. loden of road Froduntlon pen Tar itos71909-TIolIti - Index of per espies rno-al Cifns fnnual Attendance rer Ce1ir. nor fear - based on the n=bet of prod-etion of all food rom oditis. P,rductioe excludes seed asd feed ad nickets soild during the yeer, includingadmissites cc druve-ictiemas is on calend-r year basis. Commodities cover primooy goodn e.g. sugenoane and sobile .Inas in.tead of seori) which ann edible and con -ain triens (eg. ccffee asd new are eacluded.) Aggregate prodootitn of each country iE based On LAeOR FPRCE tatioi average prodscer price weights; lt-N 0, end 1979 dotn. Tor1a o fohab Frc A h ... d bu - y;--ietly ctic persns, inclditng Per et-na o-rein ofcaloie frrer of.Ceuree ) -Copared fras orned foros end -weplryed ton. eac~iedng toor -eee snoderns e energy eqatoalent of net food suppires anailable in tountry per capita coorciog polation of ell ages Irfiini-ons ino artiou countrie- rr pee day. Avalaeble soprl is .rmpruse do-es.tc production, impors less not corpsrable; 19f0, 1970 sod 1979 dora. xportns ecd changes oi stock, te supplies exclude animal feed, seeds, Female loereent) - Pemele Dsbor force as percenwgc cf total laber Doce. quantittes used in food processing, and lossei Do distribhtio. Reqaire- dorloalnere Inercert) - Labor force in farming forescry. honcingoad sesttnwerenestieaned by by O based on rhysiolegicel needs foe nrmal sot- fishing as percentaoe of rona. labor force; ]9b0, 1970 sod 1979 dstat otanceih nosdeitg evrnuts ePe Ier.bdy egt,oeIdsr onen Lebor fore tl nininig, oo..nnrtntlon,eouctro and ass diseri l n af ppolat, Or od alloiog 1' pe -oen f weniheat oy rnd sleotrfnity owner sod gas A pi-iv-g nf tonal aibor fr c; 19t00 household le. rI; 196-65, 1970, and 1977 date 1970 and 1979 data. For capita sopply of Proin lar pen day) - Pro-ein content of pern apina Parni-ianioe Oats iperoewn) - ntO.I male, and femalo- ivtpation cr net sapply of food per day, Nt supply of food is defined as saore Rt- activity raess are toepuned as toal', malo and feosle labor fnreas qoirmenos ror nI11 --ntri-e established In liEA pronide foe sintoss percenetgee of tonal, male and foeale yopulatitn of all ages roepectinely; altoownee of 61 graee of total Frotnir per day and 20 granseof animal and 1960 197f and 1979 do. These eae based ow ILO's psrticipation rate p.lne prote-i, of which El grass should be animal protei. These stand- rIfleting age-sestrucrune of the p,pelarlor, wAd long tie trend. A rads are lower ehbs thone of 75 grass of tonal proteIn end 27 grass of fse esnimenes are fres sstiooal soerees _isl proein.se a .verge for the old, proped by FAO in the Thrd Ec-onics Ded-nny Ratio - Baio of popelnie under 15 nd 6and5 r World rood Survey; 1961-65, 1970 ond 1977 data. to thne te lsohr fevee Per capita protein sanely froo animal and Pelse - Proteti nipply of food de- fiord fros solsals and pulses is grams pen day; 1961-65. 1970 and 1977 dta. I'NCOfP DISTREZUTlIt Child ages 1-4) torcol Rate (ron thousand) - An.sal deaths per thooneod in Frre ure u Ien (both in sh and kind) - Reecined bylnhct age group 1-c ferar, no ctildren in this age froep; for nose denelopingcout- 5 pereen .t richest 20 pereer., po-o-st 20 p-rcern, asd poorent 40 percent trie deat denined finn life tables; 1960, 1970 and 1979 daa. of hooeholds. HFALTH FOVERTY TARGET GROUE S Li Pe r p t sth i n, -7 ag e h7r o T he fo llo tirg s ntim A -es er r v ery ap y no nt esr e ee a tey e n of p e e r ny le v e ls, I a nt b Ir th ; 1 9 6 0, 1 9 7 0 pe r 1979sa n d ) - Aata, d e a th s f f d o an d s h o u ld he in te rp r o se d w ind r not-ns ra b le c au tio r. Df ageon nl pe r thousand -la d t of afntsdn av e pear Etaimarod Obselre Ponrinv Income Lenei (0SS per eaters) - urban ean ersal - Aofes ta Sparfe Woo - Ntr AbsoLoro ponerty ticos ievrl is chat inrome level beloc which a niolsaf ucenstoz Osfe Oacrr loerrot of e l -XU [U. ol ,1 n teuan,- ordt s ro fu- oretn onsly adequate diet plus resoential on-feed requiremenot IS not haer sfuypply (tonal,d trhatead srfacletc raersor nortedbl br ss tsae afferdiible. tarer sch nlus th eat d fry p fard b ohnl, sri rge ,nd htaicory eDasd) R frIso1ed t-lani-o -onnrcn Income Lenel (1$ per rcpital - erhan and rendal - -onerncbag r oF theoi fresertedhopelateonspng an drba tara yapulni Ruralreianfnepovertyincorelevelis onr-nnlrd ofor P"e-e perrt _apI ferountgin of elteO resplcatIed noteolenthan 1 an0 orbean are- aa houemayb pernonas income of the country (Uthat leyel in drrived from the rural fnr-t n -eadp-ng lca.Itd not mrle n.. 0 tes foFs a boner my he f l lenel sltb adjustment for higher cent of livntg it urban areas reasonabldnrrd s veog ] i=ply roosn the horusn of that b s to areas E ated Population telon Abto]uoe Pov-rtny l-co tenn -ba do non have ac rho hur i or nenhday o f the hinsethed and ernal - Fercent of yopulation (b-an ar.d rural) rho are "obsclute fort y's se eespo tccessto rteta dOygasoal ecentdecc ue_it e- cjurban andrrural - Ncnber If pebpirtuo. -r-an,andrural) sered byh crets dicp-eelAS perctn_aoe_ tO their rIaPrctir e.popla ienai r Etane disposal moy i-eludo cle collection and disotal. with cc _ithot reatnet of - - t F--ic yd noal lon Di nd wse-ater by rater-borne syntems or the use oF pin prlines and tini- nl d P-onrene- PI . ...von ar MYnn8ll1ont Thy iysjo no;er Physicisn -oPupioeio davided by tnubt oF pescrieing phyni- ia-q-l iFied nros a -edielscheel aroh unirsitylevel. rcycucevinyrceLurs:yg etyon - poisetee nnided by numben of procticloc notc nd fr-le,1uluoaenurses erucrecal ncd-as and aausisnnteorses. - 19 - ANNEX I Page 4 of 5 ECONOMIC INDICATORS GROSS NATIONAL PRODUCT IN 1978/79 ANNUAL RATE OF GROWTH (% constant prices) US$ Mln. % 1978/79 GNP at Market Prices 569.9 100.0 24.9 Gross Domestic Investment 245.8 43.3 24.2 Gross National Saving 187.5 32.9 81.7 Current Account Balance -58.3 -10.4 Exports of Goods, NFS 370.2 65.0 31.5 Imports of Goods, NFS 434.7 76.3 17.3 OUTPUT, LABOR FORCE AND PRODUCTIVITY IN 1978/79 Value Added Labor Force 1/ V.A. Per Worker USS Min. % Mln. % USS %of Ave. Agriculture 95.5 15.5 0.291 82.4 328.2 18.8 Industry 237.7 38.6 0.019 5.4 12,510.0 717.4 Services 282.4 45.9 0.043 12.2 6,567.4 376.6 Unallocated . . Total/Average 615.6 100.0 0.353 100.0 1,743.9 100.0 GOVERNMENT FINANCE Central Government (P. Min.) % of GDP 1978/79 1978/79 1975/76 - 1978/79 Current Receipts 136.8 27.2 27.4 Current Expenditures 99.1 19.7 20.2 Current Surplus 37.7 7*5 7.1 Capital Expenditures 79.0 15.7 13.9 External Assistance (net) 45.9 9.1 8.8 MONEY, CREDIT and PRICES 1974 1975 1976 1977 1978 1979 1980 (Mlilon P Outstanding End Period) Money and Quasi Money .. .. .. 83.4 88.1 172.7 219.7 Bank Credit to Public Sector 2/ 1.5 2.9 3.1 2.6 1.9 1.3 0.7 Bank Credit to Private Sector 36.2 52.6 65.1 69.7 74.5 78.0 91.3 (Percentage or Index Numbers) Money and Quasi Money as % of GDP .. .. .. 25.8 20.7 General Price Index (March 1980=100) .. 56.2 64.3 72.5 78.4 89.8 100.0 Annual percentage changes In: Bank Credit to Public Sector 93.3 6.9 -16.1 -26.9 -31.6 -46.2 Bank Credit to Private Sector 45.3 23.8 7.1 6.9 4.7 17.1 1/ Labor force Is defined as persons of 10 years and over engaged either In family agriculture or In cash employment. Migrant workers In South Africa are excluded. 2/ Excludes parastatals. not available EAI DB not applicable 8/81 - 20 - ANNEX I Page 5 of 5 TRADE PAYMENTS AND CAPITAL FLOWS BALANCE OF PAYMENTS MERCHANDISE EXPORTS 5/ (AVERAGE 1 977-79) 1977 1978 1979 1980 1/ US$ Mln. % (Millions US S) Exports of Goods 2/ 194.9 223.5 425.8 578.8 Meat and meat products 58.5 19.1 Imports of Goods 3/ 239.3 -288.7 418.3 619.0 Diamonds 136.3 44.4 Balance of Trade (deficit= -) -44.4 -65.2 7.5 -40.2 Copper/nickel 66.7 21.8 All other dommodities 45.2 14.7 Non-factor Services (net) -19.3 -23.0 -28.5 -46.4 Total 306.7 100.0 Factor Services (net) - 6.0 -37.4 -64.4 -74.4 Net Transfers 53.2 80.9 82.9 132.1 Balance on Current Account -16.5 -44.7 - 2.5 -28.9 EXTERNAL DEBT, DEC. 31, 1980 USS MIn. Direct Foreign Investment 18.1 53.2 112.7 119.2 Net MLT Borrowing 10.0 3.2 6.6 6.6 Public Debt, incl. guaranteed 148.5 Disbursements 15.8 11.4 15.7 18.4 Non-Guaranteed Private Debt Amortization 5.8 8.2 9.1 11.8 Total Outstanding & Disbursed 148.5 Capital Grants 41.9 - 0.2 -37.0 - 3.1 Other Capital (net! ) DEBT SERVICE RATIO FOR 1980 4/ Other Items n.e.l. ) -33.0 39.5 28.0 -156.6 Increase in Reserves (-) -20.5 -51.0 -107.8 62.8 Public Debt, tncl. guaranteed 1.9 Net Reserves (end year) 99.3 129.4 249.6 352.0 Non-Guaranteed Private Debt Total Outstanding & Dlsbursed 1.9 Fuel and Related Materials Imports 5/ 299.1 389.5 573.1 of which: Petroleum 31.5 34.3 77.1 .. IBRD/IDA LENDING (Dec. 31, 1980) Exports 5/ 195.6 244.3 480.2 .. (Million USS) of which: Petroleum IBRD IDA RATE OF EXCHANGE 6/ Outstanding & Disbursed 50.0 15.6 1974 1975 1976 1977 1978 1979 1980 Undisbursed 41.9 0.1 Outstanding Incl. US$1.00 = P 0.689 0.869 0.869 0.828 0.828 0.789 0.742 Undisbursed 91.9 15.7 P 1.00 = US$ 1.450 1.150 1.150 1.208 1.208 1.268 1.348 1/ Provisional 2/ Recorded customs statistics adjusted for timing and coverage. 3/ Recorded customs statistics adjusted for valuation (exclusive of duties, Insurance and freight) and coverage. 4/ Ratio of Debt Service to Exports of Goods and Non-factor Services. 5/ Unadjusted trade figures. 6/ Annual averages. Not available Not applicable EAlDB 8/81 - 21 - ANNEX II Page 1 of 5 STATUS OF BANK GROUP OPERATIONS IN BOTSWANA A. STATEMENT OF BANK LOANS AND IDA CREDITS (July 31, 1981) Amount (less Cancellations) ----US$ Million---- Number Year Borrower Purpose Bank IDA Undisbursed Two loans and six credits fully disbursed 36.5 14.7 1019 1974 Botswana Develop- Development Finance Company ment Corporation Project 4.0 1.4 1174 1975 Botswana Third Road Project 5.8 1.3 1274 1976 Botswana First Education Project 10.5 1.8 1408 1977 Botswana Fourth Road Project 20.0 6.6 1497 1977 Botswana Second Livestock Project 6.5 5.6 1584 1978 Botswana Second Urban Project 8.0 6.0 1763 1979 Botswana Second Water Supply Project 4.4 4.2 1828 1980 Botswana Second Education Project 10.0 10.0 1941 1981 Botswana Fifth Road Project 17.0 17.0 Total 122.7 14.7 of which has been repaid 14.6 0.3 Total now outstanding 108.1 14.4 Amounts sold 10.0 of which has been repaid 7.5 7.5 - Total now held by Bank/IDA 1/ 100.6 14.4 of which Is undisbursed 53.9 - 53.9 1/ Prior to exchange adjustments. - 22 - ANNEX II Page 2 of 5 B. STATEMENT OF IFC INVESTMENT (July 31, 1981) Investment US$ Million Equivalent Number Year Borrower Type of Business Loan Equity Total 448-BT 1979 Botswana Development Finance Company Development Corporation - 0.37 0.37 Total Gross Investments - 0.37 0.37 Less cancellations, terminations, repayment and sales Total now held by IFC - 0.37 0.37 - 23 - ANNEX II Page 3 of 5 C. STATUS OF PROJECTS IN EXECUTION AS OF SEPTEMBER 1, 1981 Loan No. 1019-BT Botswana Development Corporation Project; US$4.0 Million Loan of June 27, 1974; Effectiveness Date: December 9, 1974; Closing Date: December 31, 1981 The Line of Credit to Botswana Development Corporation was fully committed in June of this year. Loan No. 1174-BT Third Road Project, US$5.8 Million Loan of November 21, 1975; Effectiveness Date: January 12, 1976; Closing Date: March 31, 1982 The project was amended in 1978 to include additional components to utilize surplus funds. The Gaborone-Molepolole Road was completed satisfac- torily in 1979 and only implementation of the District Roads Maintenance Pilot Program remains to be finished. Project completion is expected to be one year behind schedule because of a delay in recruiting technical assistance staff with appropriate expertise to implement the pilot program. Loans No. 1274-BT and 1275-T-BT Education Project; US$10.5 Million (US$7.0 Million Bank and US$3.5 Million TW) of May 28, 1976; Effectiveness Date: September 10, 1976; Closing Date: March 31, 1982 Implementation, after initial delays in completing building designs, is proceeding satisfactorily and all components are expected to be completed by the March 31, 1982 closing date. Project objectives are expected to be achieved. Loan No. 1408-BT Fourth Road Project; US$420.0 Million Loan of May 20, 1977; Effectiveness Date: August 18, 1977; Closing Date: December 31, 1981 The project was amended in 1978 to use savings to pave an additional 17 km of roadway. The construction and studies components are proceeding on schedule. - 24 - ANNEX II Page 4 of 5 Loan No. 1497-BT Second Livestock Project; US$6.5 Million Loan of December 30, 1977; Effectiveness Date: November 27, 1978; Closing Date: June 30, 1983 The project is being intensively reviewed by the Bank and Government in the light of poor performance in increasing cattle production and offtake and reversing overgrazing trends through the establishment of commercial ranches and communal grazing areas. Preliminary findings suggest that the project was based on insufficient understanding of the economic and social implications of the Government's Tribal Grazing Lands Policy, which it was designed to support. Measures to improve livestock marketing by upgrading trek routes, railway sidings and holding areas are, however, proceeding extremely well. Loan No. 1584-BT Second Urban Project; US$8.0 Million Loan of September 11, 1978; Effectiveness Date: June 20, 1979; Closing Date: December 31, 1982 Implementation is proceeding satisfactorily. Site improvements have begun while legislation enabling town councils to recover service levies is improving the cost recovery picture. Loan No. 1763-BT Second Water Supply Project; US$4.4 Million of January 9, 1980; Effectiveness Date: September 18, 1980; Closing Date: December 31, 1982 Implementation is proceeding satisfactorily. Loan No. 1828-BT Second Education Project; US$10.0 Million of April 16, 1980; Effectiveness Date: June 13, 1980; Closing Date: June 30, 1985 Implementation is proceeding satisfactorily. Loan No. 1941-BT Fifth Road Project; US$17.0 Million of February 1981; Effectiveness Date: May 4, 1981; Closing Date: October 1, 1984 This project became effective in May of this year and is proceeding satisfactorily. - 25 - ANNEX II Page 5 of 5 D. EXISTING IFC INVESTMENT Botswana Development Corporation, 448-BT IFC has subscribed to preference shares in the Botswana Development Corporation and is providing technical assistance to its management by being represented on the Board of Directors. - 26 - ANNEX III Page 1 of 1 BOTSWANA THIRD EDUCATION PROJECT SUPPLEMENTARY PROJECT DATA SHEET I. Timetable of Key Events (a) Time taken to prepare 4 months (b) Prepared by Government and Bank Staff (c) Initial discussions and identification mission October/November 1980 (d) Appraisal mission departure March 1981 (e) Negotiations September 1981 (f) Planned date of effectiveness March 1982 II. Special IBRD Implementation Actions None III. Special Conditions (a) Agreed guidelines would be used in determining the location of primary schools to be assisted under the Project (para. 36). (b) The MLGL would provide the Bank through the PIU: (i) before the beginning of each of Botswana's fiscal years, a work plan and budget satisfactory to the Bank for the construction of primary school facilities, and (ii) an annual report comparing actual work completed with that planned. (c) As a condition of disbursement against the primary classrooms component, the three accounting specialists and their local counterparts would be appointed and in place (para. 39). 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