Crop diversification and agricultural services project
 Report No: ; Type: Report/Evaluation Memorandum ; Country: Equatorial Guinea; Region: Africa; Sector: Other Agriculture; Major Sector:
                                                             Agriculture; ProjectID: P000646


Equatorial Guinea: Crop Diversification and Agricultural Services Project (Credit 2181-EG)

The Equatorial Guinea Crop Diversification and Agricultural Services project, supported by Credit 2181-EG for
US$6.3 million, was approved in FY91. The Credit was closed in FY95, two years ahead of schedule and the
undisbursed balance of US$2.2 million was canceled. The project was cofinanced with the International Fund for
Agricultural Development (IFAD), Banque Arabe de D‚veloppement Economique en Afrique (BADEA) and the
Organization of Petroleum Exporting Countries (OPEC) Fund. IFAD provided US$5 million equivalent, BADEA
US$3.9 million equivalent and the OPEC Fund US$1.5 million equivalent. The Implementation Completion Report
(ICR) was prepared by the Africa Regional Office. The Borrower's brief comments are annexed to the ICR.

The objective of the project was to reduce rural poverty by improving nutrition and food security, increasing food
production, promoting local food marketing and increasing foreign exchange earnings. The project was designed to
accomplish these wide-ranging and challenging goals through a combination of policy reforms and project
investments. The IDA credit covered the marketing, agricultural extension and applied research and institutional
development activities of the project. It provided finance for civil works, vehicles and equipment, technical
assistance, training and studies, establishment of a savings and credit service, and incremental salaries and operating
costs. IFAD financed part of the extension, research and marketing activities and the rehabilitation of abandoned
cocoa plantations. BADEA support was pledged for vehicles, equipment and civil works and the OPEC Fund for
vehicles, training and studies, and for operating costs.

The project design was flawed. It failed to incorporate lessons learned from the preceding project (Cr. 1548-EG),
exceeded the implementation capacity of local institutions, included cofinancing of critical project components by
donors (BADEA and OPEC) who were already in dispute with the borrower over arrears, and was much too
complex to be implemented successfully. Implementation of the project depended, to a large extent, on technical
assistance (50 percent of disbursements). Thus the uneven performance and high turnover among technical
assistance experts contributed substantially to the unsatisfactory implementation of the project.

The Operations Evaluation Department agrees with the ICR in rating the overall outcome of the project as highly
unsatisfactory, sustainability as unlikely and institutional development as negligible. In accord with the ICR, OED
also rates the performance of the Bank as unsatisfactory.

Lessons that can be drawn from this project are: (i) follow-on projects must be very carefully designed to
incorporate the lessons from previous projects; (ii) project objectives and interventions should be kept as simple as
possible and should have the full ownership of the borrower from the earliest stage of the project cycle; (iii)
institutional development projects must take explicit account of the capacity of local human resources and should
not utilize complex designs that require the employment of much long-term technical assistance; (iv) cofinancing
for key project components is unwise unless the availability of that finance is certain; and (v) satisfactory
information and monitoring systems are important tools for good project management and should be developed
during an early stage of the project. The ICR is satisfactory and provides a clear account of the course of this
project. There are no plans for the future operation of the activities supported under this credit, although there are
tentative plans to support a future natural resource management project. The borrower has expressed interest in
refinancing and restarting the project. No audit is planned.