Document of The World Bank FILE COPY FOR OFFICIAL USE ONLY Report No. P-3239-LBR REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE REPUBLIC OF LIBERIA FOR A MONROVIA URBAN DEVELOPMENT PROJECT March 11, 1982 This document hu a resiteatd distoibuke and may be uised by reipiets Jy the pwmou i teir efkiWd utis. Its mtnts may not otherwise be disclosed without World Hbank a dwrbadon. CURRENCY EQUIVALENTS The official monetary unit is the Liberian dollar with a par value equal to the US dollar. The US dollar is a legal tender in Liberia. FISCAL YEAR July 1 to June 30 ABBREVIATIONS AND ACRONYMS ADB - African Development Bank CDC - Commonwealth Development Corporation DPD - Development Projects Department, of MCC LBDI - Liberian Bank for Development and Investment LEC - Liberia Electricity Corporation lWSC - Liberia Water and Sewerage Corporation MCC - Monrovia City Corporation MLG - Ministry of Local Government ML&M - Ministry of Lands and Mines MUDP - Monrovia Urban Development Preparation Team NHA - National Housing Authority NHSB - National Housing and Savings Bank PPF - Project Preparation Facility USAID - United States Agency for International Development FOR OFFICIAL USE ONLY LIBERIA - MONROVIA URBAN DEVELOPMENT PROJECT CREDIT AND PROJECT SUMMARY Borrower: Republic of Liberia Amount: IDA Credit of SDR 8.9 million (US$10 million equivalent) Terms: Standard Relending Terms: A total of about SDR 3.47 million (about US$3.9 mil- lion) would be relent to the following implementing agencies: SDR 1.78 million (US$2.0 million) to the Monrovia City Corporation (MCC), SDR 1.6 million (US$1.8 million) to the Liberia Water and Sewerage Corporation (IWSC), SDR 89,000 (US$100,000) to the National Housing and Savings Bank (NHSB). Relending terms would be 9 percent per annum with repayment over 20 years including 5 years grace. Description: The project aims at (i) improving the living conditions of Monrovia's urban poor by upgrading infrastructure and providing essential services in three of its most needy neighborhoods; (ii) developing a municipal management capability and establishing a solid revenue base in the municipality. The project would directly improve the living conditions of about 100,000 people (nearly one- third of Monrovia's total population) and would include: improved water supply, sanitation, roads, drainage, refuse collection, security lighting and community facilities; equipment, technical assistance and operating costs for city-wide land adjudication and registry; and training, studies and technical assistance for institutional im- provements. The project's major risks are that the main executing agency may delay project implementation because of inexperience and that land adjudication may prove more complex than anticipated, thereby postponing cost recovery. To minimize these risks major emphasis has been placed on institutional development by providing resources for technical assistance, training and studies. On the whole, the project presents an acceptable level of risk, con- sidering the benefits which would be derived. This document has a restricted distribution and may be used by recipients only in the performance of their ofricial duties. Its contents may not otherwise be disclosed without World Bank authorization. Estimated Cost: -------------US$"000------------ (including US$0.3 million of Local Foreign Total taxes and duties) Upgrading 3,588 3,559 7,147 Land Adjudication 972 577 1,549 Institutional Development 83 883 966 PPF Repayment - 440 440 Total Base Cost 4,643 5,459 10,102 Physical Contingencies 343 3517 700 Price Contingencies 1,590 945 2,535 Total Project Cost 6,576 6,761 13,337 Financing Plan: --------------US$ Million-------- Local Foreign Total Government of Liberia 3.3 - 3.3 IDA Credit 3.3 6.7 10.0 TOTAL 6.6 6.7 13.3 Estimated Disbursements: ----------------US$ '000---------------- IDA FY 1982 1983 _1984 1985 Annual 1,900 4,300 2,900 900 Cumulative 1,900 6,200 9,100 10,000 Rate of Return: 12 percent (upgrading schemtes) Appraisal Report: No. 3384-LBR, dated November 30, 1981 INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE REPUBLIC OF LIBERIA FOR A MONROVIA URBAN DEVELOPMENT PROJECT 1. I submit the following report and recommendation on a proposed credit to the Republic of Liberia for the equivalent of SDR 8.9 million (US$10.0 million equivalent) on standard IDA terms to help finance a Monrovia urban development project. A portion of the proceeds of the credit would be relent to government agencies as follows: SDR 1.78 million (US$2.0 million) to the Monrovia City Corporation (MCC), SDR 1.6 million (US$1.8 million) to the Liberia Water and Sewerage Corporation (LWSC), and SDR 89,000 (US$100,000) to the National Housing and Savings Bank (NHSB). The loans would be repaid over 20 years including 5 years of grace and interest charges would be 9 percent per annum. PART I - THE ECONOMY 2. An economic report, entitled "Liberia: Current Economic Situation and Prospects" (No. 2662-LBR), was distributed to the Executive Directors on December 28, 1979. An economic mission visited Liberia in June 1981 to review the current economic situation and its principal findings are included in the following paragraphs. Country data are shown in Annex I. Structural Characteristics 3. The growth of Liberia's economy remains heavily dependent on the performance of the enclave sector consisting mainly of: (a) iron ore mines, (b) rubber plantations, and (c) forestry concessions. These enclaves are the main source of export earnings. Iron ore mining is by far the largest single activity in the enclave sector, accounting for about one-third of gross domestic product at factor cost. There are only limited linkages between the enclaves and the rest of the economy; as a result, the benefits of economic growth have been unevenly distributed. 4. The income disparities between traditional agriculture and the (monetized) modern sector are a manifestation of structural imbalance in the economy. Traditional agriculture has minimal inter-action with the rest of the economy; however, it supports the majority of the population - as much as 60 percent - who live at, or near, subsistence level. With a population of about 1.7 million, average per capita GNP in 1979 is estimated at US$500. While the enclave sector yields a per capita GNP of about US$1,620 compared to US$780 for the rest of the monetized economy, the great majority of the population who live in the traditional non-monetized sector have a per capita income of about US$185 per annum. - 2 - Development Plan and General Economic Policy 5. After completing its first four-year Development Plan, Liberia has embarked upon preparation of a Second Plan. The first Plan was intended as the first of a series of multi-year investment programs aimed at meeting the basic, long-term objectives of Liberia's socio-economic development. These are: (a) diversification of production; (b) dispersion of sustainable socio- economic activities throughout the country; (c) greater involvement of Liberians in development activities; and (d) equitable distribution of the benefits of economic growth. Performance under the first Plan fell short of expectations. Investment in the productive sectors was below the original target, while one-fourth of total expenditure during the Plan period was for facilities and buildings for the Organization of AfriLcan Unity (OAU) confer- ence, which had not been included in the original Plan. 6. The new Government which assumed power in April 1980, reaffirmed the broad objectives of the First Plan. Work had been initiated under the former Government on the preparation of the Second Plan (FY82-86) which is scheduled for completion shortly. The general economic policy statement issued by the Government of the People's Redemption Council on June 5, 1980 sets out the broad objectives of the new regime. The main thrust of the economic policy is to expand the country's productive capacity, especially in agriculture, and to ensure that benefits from economic growth and development are enjoyed by an increasing number of Liberians. To achieve this end, the Government intends to encourage local and foreign private investment and give priority to labor intensive investments. Significant measures taken by the new Government since its assumption of office include decisions: (a) to retain the Liberian dollar at par with the US dollar, which remains legal tender in Liberia; (b) to honor all existing contractual agreements with foreign private investors and to change such agreements only through negotia- tions with all parties concerned; (c) to permit free flow of capital, goods and services; and (d) to regulate labor relations by full protection of the rights of both workers and management. Recent Economic Developments 7. While strong world demand for Liberia's major export, iron ore, brought large gains in export prices in 1974, the subsequent recession in industrialized countries significantly reduced demand for the country's most important export commodities--iron ore, rubber and timber--in the 1975-78 period. With growth performance continuing to be largely a function of enclave activities, growth of real GDP--which averaged about 6.3 percent a year in the 1967-70 period and 4.2 percent a year in the 1970-74 period--has slowed down significantly and is estimated to have beien about 0.7 percent per year between 1974 and 1978. Economic performance in 1979 and the first quarter of 1980 had taken a turn for the better, but following the change in Government in April 1980 there was a setback in growth, and, according to the preliminary estimates, real GDP is reported to have declined by 4.4 percent in 1980. - 3 - 8. During 1974-78, mostly reflecting accelerated international infla- tion, imports rose by 14 percent annually, exceeding the 5 percent annual export growth rate. However, the resurgence in world prices of iron ore, timber and rubber helped Liberia to expand its exports by 10 percent in 1979 and 14 percent in 1980. Oil imports increased from US$15 million in 1973 to US$103 million in 1979, or one-fifth of the country's total imports. But higher prices for Liberia's major exports helped achieve a trade surplus of US$30 million in 1979; the growth in imports has been relatively lower in the last 18 months due to the general slack in economic activities following the change in Government. The current account deficit, reflecting substantial remittances of capital and other factor income from enclave operations, increased to about US$132 million in 1979, or 13 percent of GDP, as compared to US$30 million in 1974, or 5 percent of GDP. Rising current account deficits were financed mostly by private capital transactions, but in the last two years, official capital inflows have risen substantially. 9. Liberia has had a long history of sound fiscal management and public sector resources did not come under undue pressure until the mid-1970s. Since 1974, the Government has been facing growing budgetary deficits. The deficit in 1975 was only about US$4.0 million, but by FY1979 had reached US$161 million, or 79 percent of government revenues. The strain on public sector finances intensified during 1979-80 and assumed serious proportions in the aftermath of the change in Government. The decline in public revenues, coupled with a decision to increase the salaries of low-paid military personnel from $100 to $250 per month and the payment of pending bills from the OAU Conference, increased the overall budgetary deficit from an estimated $56 million to $95 million (9 percent of GDP) by the end of the fiscal year. The shortfall in revenues was caused largely by lower import duty collection in the last quarter. The doubling of salaries of the lowest grade civilian employees from July 1, 1980 aggravated the budgetary deficit for FY1981 and the Government was faced with a serious liquidity crisis when it approached the IMF in May 1980 for further assistance. Relations with the IMF 10. In July 1980 the new Government introduced a two-year stabilization program to support a standby arrangement with the IMF providing for support in an amount of SDR 65 million (about US$85 million). Major elements in the stabilization program included tighter fiscal policies and stricter control of the financial operations of the public corporations, increased mobilization of domestic revenues, rationalisation of energy pricing policies, and a freeze on wages and salaries of Government employees. Limits were placed on new borrowings with a maturity of one to twelve years and on credit to the Government and public sector from the banking system. 11. The Government had introduced the necessary measures to revise tax rates and levy import surcharges. However, the budgetary deficit in FY81 is likely to be about $100 million (45 percent of Government revenues), or $25 million higher than the original budget estimates. While revenue collection is higher by 10 percent as compared to the previous year, it fell short of the expected yields as a result of a decline in customs duties. There was - 4 - There was also some increase in recurrent expenditures beyond budget estimates. This budgetary imbalance, lack of strict control on the operations of public corporations, and the consumer subsidy on rice are some of the major issues which were addressed in the context of the second yeaLr of the stabilisation program. In this connection the Government announced some important economic decisions. The consumer subsidy on rice has been eliminated; a new progres- sive national reconstruction tax has been levied on wages, salaries and self- employed income, and excise taxes on beer and gasoline have been increased. The Government also proposes to improve the financial viability of the public corporations. The IMF Board approved the program in August 1981 and made available SDR 55 million for the second year of the Standby Arrangement. 12. Monthly payments for oil imports continue to create a serious liquidity problem in public sector finances as receipts generated abroad are not sufficient to meet oil payments and service the public sector's external debt. A recent infusion of US$25 million provided by the U.S. Government in form of a grant from the Economic Support Fund will help to ease the situation. Creditworthiness 13. Liberia's external public debt outstanding and disbursed was estimated at about US$495 million as of June 1980. The Bank Group share of the public debt outstanding and disbursed is presently about 15 percent and is expected to increase to about 24 percent by 1984. As a proportion of public debt servicing liability, the Bank Group's share is expected to increase from 14 percent to 18 percent over this period. Debt service pay- ments as a proportion of exports of goods and non-factor services were esti- mated at about 10 percent in 1979 as compared to 5.7 and 7.7 percent for 1974 and 1972 respectively. Public debt service payments as a percentage of Government revenues (a more meaningful indicator for Liberia which uses the US dollar as a medium of exchange) declined from about 24 percent in 1972 and 21 percent in 1974 to 16.5 percent in 1978, but again went up to 23 percent in 1980. This upsurge in the debt service ratio has occurred primarily as a result of short-maturity loans contracted by Liberia Ln the last few years to finance OAU-related expenditures and meeting the growing budgetary deficits. In the short run, this increase in debt servicing obligations has created severe pressures on Liberia's public finances. The Government therefore sought and obtained in 1980 the assistance of the Paris Club in rescheduling its external public sector debt maturing during the period July 1980 to December 1981. In December 1981 further relief was requested and Liberia obtained an 18 month extension, with extension from October 1, 1982 to June 30, 1983 subject to renewal of the Standby agreement with the IMF when it expires in September 1982. 14. Assuming a continuation of the recent rate of growth in public revenues and exports (10 percent and 5 percent per annum, respectively) Liberia's debt service ratio is estimated to increase to about 33 percent of public revenues and 12 percent of exports by 1985; should there be an improvement in the country's economic prospects over the next few years, the debt service ratio would be somewhat lower (around 29 percent) by 1985. -5- Although the movement in world prices of Liberia's main export commodi- ties in 1981 is not particularly favorable, the growth in export earnings is projected to be higher in subsequent years as a result of the likely strengthening in demand for iron ore and an increase in iron ore prices. Forecasts for natural rubber prices also indicate a consistently upward movement, and Liberia may expect higher yields from the recently replanted acreage and new planting of rubber. Other on-going agriculture projects (particularly for coffee, cocoa, palm oil), and successful exploration and development of other mining resources, including gold and barite, will help diversify the economy and should result in an acceleration in the rate of growth of exports during the next three to four years. Public revenues will benefit from these increased export earnings. However, these prospects are clearly contingent upon a number of policy measures which the Government has to initiate and sustain over the next years, e.g., a reduction in the size of the Government budget deficit, restraint on new commercial borrowings and public sector credit expansion, increased mobilization of public savings, maintenance of the traditional openness of the economy, appropriate pricing and tariff policies, revival of investor confidence, inflow of new private investment and improvement in the coordination of overall economic management. Although Liberia has acute short-term liquidity problems, restoration of growth and stability is feasible, provided the Government is able and willing to pursue the right course. 15. In recent years Bank group lending to Liberia has been a blend of IDA credits and Bank loans; in view of the country's relatively low per capita income and high public debt service liability, continued IDA assistance is justified. PART II - BANK GROUP OPERATIONS IN LIBERIA 16. Up to December 31, 1981 the Bank had approved loans (including one Third Window loan) for 18 projects in Liberia totalling US$135.7 million; there have been 9 IDA credits totalling US$47.1 million, and one technical assistance grant of US$200,000 for development planning. IFC has made two equity investments totalling US$556,000 in the share capital of the Liberian Bank for Development and Investment (LBDI). The Bank Group assistance has financed roads, agriculture, rural development, power, education, water supply, LBDI, small enterprises, and petroleum pre-exploration. Annex II contains a summary statement of Bank loans, IDA credits, and IFC investments as of December 31, 1981 and notes on the execution of ongoing projects. Following the change of Government in April 1980, implementation of a number of projects was disrupted. For the most part projects are now being imple- mented well, although problems have been caused by the Government's inability to meet its full share of financing for some projects as a result of the severe budget constraints. -6- 17. The objectives of Bank Group operations are: (a) to help Liberians take greater initiative in developing their own resources for the benefit of their own people; (b) to support policies and programs leading to a broader distribution of the benefits of economic growth; (c) to help the Government broaden the economic base and overcome infrastructural constraints to growth; and (d) to assist the Government in mobilizing development resources from other external agencies. In furthering these objectives particular attention is being paid to (a) the need to expand the supply of trained manpower and (b) measures to strengthen and improve the operations and finances of the public corporations in Liberia. 18. In support of the objectives of raising the standard of living of lower income groups and broadening the productive base, the Bank Group lending program emphasizes agriculture and rural development. The Bank Group is currently cofinancing with USAID two agricultural projects in Bong and Lofa Counties. These projects are designed to (a) assist subsistence farmers to expand their production base and to increase their productivity and income through the provision of support services and infrastructure, and (b) help diversify the country's export and revenue base. A rubber project, co- financed with the Commonwealth Development Corporation (CDC), will expand exports and increase productivity and incomes of small and medium size farmers by strengthening credit and extension services and promoting greater Liberian participaton in the development of this subsector. The forestry project which the Bank is co-financing with the African Development Bank (ADB) and the German Agency for Technical Cooperation, will strengthen the Govern- ment's forest service, initiate an industrial plantation program, and help Liberia better manage and exploit its forestry resources. The oil palm proj- ct, co-financed by the ADB and the CDC, will help expand and diversify the country's export and revenue base, provide employment, increase the income level of rural families, and strengthen the institutional capability in the country for oil palm development. A second phase of the Lofa County agricul- tural development project has been appraised and negotiated and a credit proposal will be submitted for approval of the Executive Directors in the near future. Consideration is also being given to a rural development project in the southeastern region of Liberia. 19. In addition to its support for agriculture, the Bank Group is also assisting the Government in its diversification efforts through exist- ing lines of credit to LBDI for the manufacturing sector. The small and medium scale enterprises project, approved in November 1980, will stimulate economic activity and employment by providing a line of credit and technical assistance. The Executive Directors recently approved Bank loans for a total of US$20 million for a project to rehabilitate the Mano River mine operated by the National Iron Ore Company, which would help maintain existing employment and increase Government revenues in order to prepare for an orderly transition from mining to other economic activities in the area. The objective of the petroleum exploration promotion project, approved in O,ctober 1980, is to establish Liberia's hydrocarbon potential by attracting oil companies to take oil exploration permits in Liberia. - 7 - 20. Given Liberia's pressing needs for physical infrastructure, the Bank Group continues to play a leading role in financing development and maintenance of water supply, roads, and power. A water supply project for which a credit was granted in 1978 is designed to help rehabilitate and expand the Monrovia water supply system, extend water distribution to lower income groups in metropolitan areas, and strengthen the management, staffing, and finances of the LWSC. The feeder roads project for which a Bank loan was approved in 1979 is designed to open up the agricultural hinterland of Liberia in support of the ongoing and proposed agricultural and rural development programs. The nearly completed fourth highway project has, like earlier Bank- financed projects, expanded the country's limited basic road network. A fifth highway project under consideration would improve the country's road maintenance capability. In the power sector, a nearly completed fourth power project has expanded the Liberia Electricity Corporation's (LEC) thermal generating facilities to meet current demand, strengthened LEC's management, and extended connections to poor urban households in Monrovia. Bank Group assistance will also be considered to meet Liberia's longer term electricity needs through hydropower development. 21. Since the lack of trained manpower is a major constraint to develop- ment in Liberia, the Bank Group has financed three education projects and is currently financing preparation of a fourth project through an advance from the PPF. The proposed project, which is scheduled for appraisal in March, would continue the emphasis on manpower training and upgrade primary and secondary education in the rural areas. PART III - THE URBAN SECTOR Urban Growth 22. Nearly a third of Liberia's population of 1.7 million lives in urban areas, over half of which are in the capital city, Monrovia. The city's annual population increase of about 7 percent, due to both migration and a high rate of natural growth, has brought its population to about 330,000, over 15 times the size of the next largest town, Buchanan. If current trends continue the city will double its population in ten years. The pace of urbanization is straining Monrovia's capacity to provide jobs, infrastructure and housing for residents. Land, Housing Conditions, Infrastructure and Services in Monrovia 23. Monrovia is perched upon a rocky ridge on the Atlantic Ocean at the estuary of a major river, the Mesurado River. The city stretches along the northern and southern coastlines in a narrow "L" shape. Inland, an immense swamp obstructs further expansion and newer settlements have begun to encircle the swamp. This topography presents a serious impediment to urban growth (see Map IBRD 15578). - 8 - 24. A major problem affecting land development in Monrovia is lack of security of land tenure due to the absence of a cadastral and ownership registry throughout Liberia. Although most land is privately owned, there is often a proliferation of conflicting deeds for the same or overlapping properties, involving government, tribes, organized community groups, institu- tions, families and individuals. Lack of clear ownership of urban land has prevented development of an effective system of mortgages, inhibited land sales and building construction, discouraged improvement and maintenance of existing structures and undermined the establishment of an effective real estate taxation system. Property in Monrovia is rarely bought or sold, and little new investment is undertaken. Numerous half-built structures can be found throughout the city largely as a result of land disputes, although lack of an effective financing system is also a cause of many incomplete structures. It is estimated that half of the city's population lives in areas needing upgrading; in addition, over the next ten years, 50,000 new housing units will be needed to keep pace with anticipated population growth. 25. Sixty percent of the city's housing stock is of temporary materials. While the availability of services varies between settlements, most squatter areas have some services. Access and internal circulation is often by earth roads or footpaths. Electrical service reaches nearly all settlements, several of which have over 90 percent individual service, but there is a high proportion of illegal connections. Security lighting, however, is almost totally absent and this is considered a contributing factor to the relatively high crime rates in many areas. Most settlements are served with piped water, but the system is plagued by fluctuating pressures, illegal connections, and inadequate maintenance. Of the city's total water production, about half is lost from leakage and illegal connections. Most areas lack adequate sanita- tion. The existing sewer and drainage systems in the central area are fre- quently blocked or broken as a result of inadequate maintenance, and lack secondary connection lines to service poor areas. Equipment and organization for garbage collection are also inadequate to maintain acceptable sanitary conditions. Income and Employment 26. Out of the total 60,000 estimated jobs in Mlonrovia, the public sector accounts for half# and the informal sector accounts for perhaps another 18,000 (of these 10,000 are market women). Unemployraent is high and is estimated to range from 20 percent to 40 percent of the labor force. About 50-70 percent of residents in low-income settlements fall below the absolute poverty line of US$310 per capita per annum, or US$130 per household of five per month, the level at which an average family can just afford minimum caloric requirements. Government Initiatives 27. The Government began focussing attention oni the problems caused by Monrovia's rapid urbanization five years ago. The municipal government was restored in 1976, after over 50 years in abeyance, in order to shift responsibility for meeting the needs of the city away from the national - 9 - ministries. Increasing responsibility is to be given to the Monrovia City Corporation (MCC), a public corporation reporting to the Ministry of Local Government (MLG). To deal with the problem of security of land tenure, the Government introduced in 1974 a survey and ownership ("adjudication") registry under a new Land Registration Act. This replaces the former deed system with a guaranteed title system legally defining plots and ownership of urban land. Responsibility for the adjudication process is with a special "Adjudication Unit" headed by staff of the Ministry of Justice but managed by the Ministry of Land and Mines (ML&M). Four areas of Monrovia have so far been selected for adjudication, including the three project locations. Excessively bureau- cratic procedures, lack of equipment and operating materials, and lack of indexation of the existing deed archives, have created major obstacles to speedy adjudication. 28. MCC is a young institution which is just beginning to formulate its policies and programs and to assemble its personnel. Its Charter gave it certain powers (e.g. to buy and sell property, levy taxes etc), but did not assign it specific responsibilities. However, responsibilities are being acquired gradually and the city is now in charge of public health services, refuse collection, public safety, parks, cemeteries and recreation, mass transit and markets. Additional authority is currently being sought for drainage maintenance, traffic management, fire services, and development control (building and zoning regulation). The City Council should be made up of selected representatives and an elected Mayor and Deputy Mayor; however, following the April 1980 change in Government, the Council was suspended and the Mayor is now appointed. Because of the lack of qualified and trained professional staff, and as a result of frequent changes of mayors and chief officers, leadership is weak. The problem is exacerbated by lack of revenue; MCC's own sources of income are minor fees for market stalls, trash collection and city fines. These revenues, which represent only 7 percent of the city's budget, are the only ones MCC has authority to spend directly. The remainder of the City's budget is financed by the central Government. Accounts and financial controls are non-existent as the Government does not require MCC to submit annual audited accounts. The proposed project would help shape and strengthen MCC through technical assistance and by developing a solid revenue base (see para. 46). Concentrating municipal functions within one agency would furthermore eliminate overlapping ministerial functions, poor coordina- tion and duplication of effort and maximize the impact of Liberia's scarce financial and manpower resources. 29. More recently, the Government launched a new program for sites and services for low income groups to be implemented by the National Housing Authority (NRA) and the National Housing and Savings Bank (NHSB) with USAID assistance. The project would provide 1,000 to 4,000 serviced plots with community facilities and construction loans for self-help housing. Technical assistance is being provided to the executing agencies with the aim of helping the Government shape a national housing policy. Improvements in the drainage, sewerage and electricity services to the urban poor have also begun under the Bank Group-financed Fourth Power Project (Ln. 1600-LBR) and First Water - 10 - Project (Cr. 859-LBR). In addition, a sewerage Master Plan for Monrovia was started in November 1980 to identify measures to reduce the heavy contamina- tion of the water system and improve maintenance. 30. To alleviate unemployment the Government has started a number of assistance programs, including a small-scale enterprises project for which an IDA credit of US$5 million (Cr. 1076-LBR) was recently approved. USAID has also approved a line of credit of US$1 million through the NHSB to the infor- mal sector for small-scale enterprises. Technical assistance and training schemes are included under both projects, and the Bank supported Third Educa- tion Project is also reinforcing vocational training. In an attempt to address urban sector needs more systematically, the Government carried out in 1976-78 a Monrovia Urban Study which led to the establishment of the Monrovia Urban Development Project Preparation Team (MUDP). The latter's report of February 1980 is the major feasibility study input for the proposed project. PART IV - THE PROJECT Background and Objectives 31. The project was prepared in 1979-80 by MUDP with the help of consul- tants financed under an advance of US$450,000 from the Project Preparation Facility (PPF). The advance was granted in two stages: US$250,000 in July 1979 and US$200,000 in August 1980. Appraisal took place in November 1980. Negotiations were held in Washington on August 26 and 27, 1981. The Liberian delegation was led by Mr. Rudolph Johnson, Deputy Minister, Ministry of Finance. The proposed project is described in the report entitled "Monrovia Urban Development Project" (Staff Appraisal Report No. 3384- LBR, dated November 30, 1981) which is being circulated separately to the Executive Directors. 32. The project is aimed at improving the living condition of the urban poor by (a) upgrading infrastructure and providing essential services in three of Monrovia's most needy neighborhoods; and (b) strengthening key institu- tions to provide more effective management and a broader revenue base for the MCC. Project Description 33. The proposed project would include of the following components: (i) Upgrading: improved water supply, sanitation, roads, drainage, refuse collection, security lighting and community facilities for about 70,000 settlers of Monrovia; (ii) Land adjudication: technical assistance, vehicles, field and office equipment and operating costs for land surveys and titling in the project area under a first phase adjudication program covering 30,000 people; at a later stage the program would be extended to the whole city of Monrovia; - 11 - (iii) Institutional development: technical assistance and studies to strengthen municipal management and broaden the municipal income base. 34. Upgrading: Improved services would be provided to Claratown, Sonewein and Slipway, three existing settlements in Monrovia (see map) inhabited by about 25,000 people. Another 5,000 people would benefit through new plots in Claratown to house those who would have to be resettled because they live in the pathway of new facilities to be constructed under the proj- ect. House construction loans would be provided to those requiring resettle- ment. The three settlements were selected mainly for their large population and poor living conditions. Claratown, being a newer, rapidly growing area of about 7,000 people, is largely without services. Sonewein and Slipway, with populations of 11,000 and 7,000 respectively, are older areas with severely deteriorated services. Lack of adequate sewerage is creating a severe health hazard in the two older settlements. 35. Major access roads and footpaths would be improved in all three project settlements and drains would be built along one side of them. The project would also provide about 31 centrally located "wet cores", each containing 12 toilet units, shower facilities and water standpipes nearby. Refuse collection points would be provided along major roads, with collec- tion vehicles, loaders and maintenance equipment. Since most families have power connections, street security lighting only would be provided in the three project areas. LWSC's water standpipe program would be extended to other low-income areas of Monrovia, to serve about 40,000 additional people. Primary education and basic health services would be improved through con- struction of a new school and upgrading existing ones, as well as through construction of a community health center and three health units. One new market would be built and an existing one would be renovated and expanded. A study under terms of reference agreed with IDA and financed through the Project Preparation Facility (see para 31), would help MCC review its policy on markets and the suitability of its current market fee structure. A com- munity center would be built in each upgraded area to provide space for community meetings. To avoid sharp rent increases arising from project improvements, design standards would be kept to basics only. In those cases where structures would have to be demolished to make way for new works, the Government would pay compensation to houseowners; land taken over would also be compensated if clear title can be established. 36. Land Adjudication: The project would provide support to the Govern- ment's ongoing land adjudication program by financing equipment and providing technical assistance to streamline the adjudication process. Assistance is envisaged in two phases: the first, which was initiated during project prepa- ration and is expected to be completed by end of 1982, would establish land ownership in the three proposed project areas as well as in the West Point settlement under the USAID assisted project (para 29). The second phase, - 12 - to be continued for another three years until project completion in mid- 1985, would aim at strengthening and expediting land aLdjudication throughout Monrovia. The project would provide essential office and field equipment needed by the seven adjudication teams involved in the program as well as technical assistance. Salaries and operating cost of the teams would also be financed. In the context of this project, assurances were obtained during negotiations that the Government would continue to follow land adjudi- cation procedures and compensation policies satisfactory to IDA (Section 3.04(b) of the draft Credit Agreement). 37. Institutional Development: Training would be the main element in the institutional development program. Most of the training effort would be directed towards MCC, MLG, NHA and ML&M. Local or regional, and occasionally overseas, institutions would be used for training. A training officer in MCC would formulate a detailed training program and supervise its implementation. The project would also provide for consultants to carry out the following studies: (a) a Municipal Management Study, which should provide guidelines for strengthening MCC; (b) a study of LWSC tariffs; and (c) preparation of a second urban project. The Municipal Management Study would provide a general review of MCC's operations, including its organizational structure and manage- ment, revenue accounting systems and staff development: program. The study is expected to take six months. Technical assistance would also be provided to implement the study's recommendations and to help MCC establish an effec- tive tax collection operation. The LWSC water tariffs study is discussed in para 47. Consultants would be required to train their Liberian counterparts. In total, 83 man-months would be included in the project for studies and technical assistance. Assurances were obtained during negotiations that the project would employ consultants under terms of reference and conditions acceptable to IDA (Section 3.03 of the draft Credit Agreement). The Govern- ment would review with IDA the results and recommendations of the Municipal Management, urban project preparation and LWSC tariff studies within six months of their completion and take IDA's comments into account in taking subsequent action (Section 3.05 of the draft Credit Agreement). Project Implementation 38. Project implementation is expected to take four years with start-up by mid-1982. Land adjudication has already been initiated. Training will begin shortly under PPF funding and continue through t-he end of 1982. Primary responsibility for implementation would be with MCC under the supervision of MLG. The water standpipe extension program would be carried out by the LWSC and the Liberia Electricity Corporation (LEC) would carry out the security lighting investments. LWSC and LEC would ultimately own and maintain water sanitation and power infrastructure. Land adjudication would be the responsi- bility of the ML&M. The Steering Committee which guided project preparation would be maintained under the chairmanship of MLG to coordinate project imple- mentation and ensure a unified policy framework for a:Ll upgrading programs in Liberia. Assurances that the Government would maintain this Committee and include representatives of all government ministries and agencies concerned with the project were obtained at negotiations (Section 3.02 of draft Credit Agreement). - 13 - 39. A new department, the Development Projects Department, (DPD), has been established within MCC to carry out the upgrading programs. DPD, through its three divisions (Technical, Community Development, and Finance) would be primarily responsible for detailed design and engineering, community consulta- tion, preparation of tender documents, bidding, contract award, supervision of construction and project monitoring. Consultants would be employed to carry out all detailed design and engineering and to supervise construction and private contractors would be utilized for civil works construction. The Director and senior staff of DPD has been appointed in consultation with IDA. Agreement was reached during negotiations that (a) MCC would maintain, ade- quately staff and provide all necessary resources to DPD to carry out the project, (b) employ additional specialized staff according to an agreed time table and (c) consult IDA on appointments to the positions of Director and Division Chiefs of DPD until completion of the project (Section 2.02 of the draft Project Agreement). Monitoring and evaluation would be undertaken by DPD and by the project supervising unit in MLG. 40. MCC would prepare an opening financial statement in a form satis- factory to IDA by April 1, 1982, reflecting its position as of December 31, 1981. It would thereafter submit annual accounts, including a separate account of project expenditures, audited by a firm acceptable to IDA, not later than six months after the close of each fiscal year (Section 3.02 of the draft Project Agreement). 41. NHSB would grant resettlement loans to help move those families which are in the pathway of upgrading works. During negotiations agreement was obtained that, for lower income groups wishing to borrow sums below US$3,500, the normal requirements of maintaining a savings account, and life and fire insurance and of having title to the land would be waived. A govern- ment guarantee or a long-term lease with authority to add a 1 percent risk surcharge to NHSB's interest rate would be acceptable in place of land title. Mortgage rates would be at least 12 percent per annum with repayment over 20 years (the same as in the USAID project) (Schedule 3 of draft Credit Agree- ment). The interest rate is slightly below the present rate of inflation (14 percent per annum); because of very tight liquidity in Liberia the inflation rate is, however, expected to fall to around 10 percent per annum. 42. ML&M would be responsible for land adjudication through its Lands and Surveys Department. The adjudication unit under the Department aleady has some trained and experienced Liberians. Agreement was obtained during nego- tiations that (a) the seven adjudication teams would be maintained at full strength of six persons; and (b) four of the teams would be assigned to project areas (Section 3.04 (a) of the draft Credit Agreement). 43. Community organizations are well established in the three settle- ments to be upgraded and have already undertaken, on their own initiative, a number of improvement programs which demonstrate their desire for improvements and willingess to pay for them. Community organizations are expected to play an active role in the design, maintenance and operation of the facilities provided under the project. - 14 - Project Cost and Financing Plan 44. The total cost of the project (including taxes) is estimated at US$13.3 million, of which US$6.8 million or 51 percent represent foreign costs. Taxes and duties are estimated at US$0.3 million. Base cost estimates are in January 1981 prices. Price contingencies (US$2.5 million or 19 percent of total costs) are based on projected cost increases for domestic project inputs of 15 percent per annum over the four-year project period, and 9 percent, 8.5 percent and 7.5 percent on foreign costs for 1981, 1982 and 1983-85 respectively. Physical contingencies (US$0.7 million, or 5 percent of total costs) are equivalent to 15 percent on civil works. Detailed design and engineering and construction supervision are estimated at 10 percent of civil works costs. DPD's salaries and operations are estimated at 8 percent of such costs. Total contingencies amount to about 32 percent of the estimated base cost. The cost of foreign consultant services (totalling 83 man-months) are estimated at US$10,000 per average man-month. A summary breakdown of costs is shown in the Credit and Project Summary at the beginning of this report. 45. The proposed IDA credit of SDR 8.9 million, equivalent to about US$10 million, would finance about 76 percent of total project costs, net of taxes and duties. This would cover 100 percent of the foreign costs and half of the local costs. Local cost financing is recommended because the Government is facing severe budgetary constraints and is short of resources for investment. The Government would dispose of the IDA funds as follows: (i) SDR 3.47 million would be relent to the implementing agencies in the following manner: SDR 1.78 million to MCC for sanitary facilities, security lighting, refuse vehicles and portions of training, technical assistance, studies and management related to the Corporation; SDR 89,000 to NHSB for house loans for essential resettlement; and SDR 1.6 million to LWSC for off-site water and sewerage infrastructure, the standpipe extension program and the water tariff study. These funds would be relent to the agencies under subsidiary loan agreements satisfactory to IDA, and would carry interest charges of 9 percent per annum with repayment over 20 years including 5 years grace (Section 3.01 (c) of the draft Credit Agreement); (ii) the Government would use the remaining SDR 5.43 million for drainage, access roads, land adjudication and community facilities, and to finance training, technical assistance and studies related to agencies other than MCC, the PPF advance would also be repaid to the Bank out of the Credit. Cost Recovery and Affordability 46. About 85 percent of project cost would be recovered through citywide property tax charges. One of the project's main objectives is to gradually develop a solid revenue base for MCC by strengthening citywide property tax collection. Property tax is emphasized because: (a) it is an existing tax for which there are already manpower and administrative capacities; and (b) the potential for increasing public revenue is considerable as present collection is very low--about 20 percent of potential yield based on present assessments. Legislation giving MCC authority to collect property tax in Monrovia, and retain 30 percent of the total sum collected, is being, enacted. - 15 - 47. In addition to property taxes, residents would pay for consumption of power and for water and sewerage services. Power tariffs are governed by rate of return covenents with the Bank under Ln. 1600-LBR. Since the extent of individual water and sewer connections is unknown (due to the high number of illegal connections) the project would introduce charges for water at standpipes. Standpipe water has been free so far with the Government having an obligation to reimburse LWSC for it. The Government has not, however, fulfilled its obligation to LWSC and it is doubtful that the Government could afford the cost of this service if it were to be expanded further. User payment for water consumption is therefore required if LWSC is to expand and service its network of standpipes. Agreement on the introduction of water charges which would enable LWSC to service its debt under the subsidiary loan agreement and cover administrative and operating costs was obtained during negotiations (Section 4.04 of the draft Credit Agreement). Tariffs and the method of collection would be determined under the tariff study to be under- taken by LWSC (para. 37). Until such collections are demonstrated to be effective, the Government would continue its obligation to pay LWSC for water at standpipes. 48. Upgrading costs under the project are relatively low--US$100 per beneficiary or US$500 per household. Assuming that up to 15 percent of total income could be spent on property tax for services and recurrent utility charges, monthly tax payments and minimal utilities charges would be afford- able by 94 percent of the area's residents, or families earning a minimum of between US$25 and US$30 per month. 49. As the collection of property tax has been poor, various steps are envisaged under the project to improve administration. A first essential step is the completion of land registration undertaken under the land adjudication component. Property valuation, the second important step, is currently being undertaken under a USAID-financed technical assistance program. The Municipal Management Study would attempt to identify a method for improving property tax collection and would be tested initially in the project areas. Three man- months of technical assistance is included in the project to help initiate the system in project areas. Assurance were obtained during negotiations that MCC would seek to improve each year the level of collection of property taxes and afford IDA the opportunity of commenting on progress made, establishing yearly tax collection targets which would be satisfactory to IDA (Section 3.03 of the draft Project Agreement). Procurement 50. Goods and services under the project would be procured in accor- dance with Bank Group guidelines. Contracts for civil works including community facilities and refuse vehicles totaling about US$7.3 million or 55 percent of the project's cost would be procured on the basis of international competitive bidding. Civil works contracts for the three settlements would be tendered together, but grouped in such a manner that bids might be submitted for each separately or for the total package. There would be local advertising and in - 16 - the Development Forum, with notification to embassies of Bank-member coun- tries, Switzerland and Taiwan. Contracts for goods and services costing less than US$250,000 each and for aerial photography and mapping, in all totalling no more than US$2 million, would be awarded in accordance with local procure- ment procedures satisfactory to IDA. The remaining project costs would be for resettlement loans, compensation, staff salaries and operating costs, training and technical assistance. Disbursements 51. Disbursement would be on the following bas:Ls: 70 percent of total expenditures for civil works; 70 percent of total expenditures for housing loans; 100 percent of foreign or 75 percent of local expenditures for equip- ment; 100 percent of consultancy services and training; 65 percent of project related operating costs and salaries of MCC and ML&M. Disbursement for civil works, consultancy services and training and all major equipment representing about US$8.5 million would be made against fully documented contracts and receipts. For other individual small expenditures (housing loans, operating costs and minor equipment), disbursement would be made against statements of expenditure. Though MCC has recently set up basic accounts for the project which are satisfactory to IDA, the establishment of accounting and auditing systems satisfactory to IDA by other agencies which propose to obtain disburse- ments through statements of expenditure would be a condition of disbursement for all items on which a statement of expenditures would be used (Schedule 1 para 4(d) of draft Credit Agreement). 52. In view of the shortage of resources being experienced by the proposed executing agencies it would be necessary to provide prefinancing for certain project expenditures to initiate project implementation. Revolving funds would be used to pay for locally procured goods and operating costs where direct payment by IDA would not be practical. Immediately after credit effectiveness, an IDA disbursement of US$300,000 equivalent would be paid into a revolving fund account which the Government would establish as a condition of effectiveness with the National Bank of Liberia (called the "Special Account") for purposes of the project. The account would be replenished by IDA on receipt of satisfactory evidence of expenditure. The Government would also open an account (called the "Project Account") to cover items it would finance, or the relevant portion of them, and would make an initial deposit of US$100,000 as a condition of effectiveness (Section 6.01 of the draft Credit Agreement). The management of both accounts and the maintenance of evidence in support of certificates of expenditure would be the responsibility of the Borrower and MCC (Section 4.01 of the draft Credit Agreement and Section 3.01 of the draft Project Agreement). Suitable reporting procedures and controls for these funds have been established. - 17 - Project Benefit and Risks 53. The economic rate of return for the three upgrading sites was estimated by calculating the present and expected market values for housing and infrastructure improvements. The economic rate of return (ERR) for the three sites, representing about 34 percent of total project costs, is esti- mated at 12 percent. In addition, there are unquantifiable benefits from improved health and education which are expected to be quite substantial. Benefits resulting from land adjudication are perhaps the most difficult to quantify but are potentially among the most important. Improved security of land tenure in Monrovia through establishment of a land registry would encourage improvement and maintenance of Monrovia's dilapidated stock of residential and commercial structures; it could stimulate new construction and remove an important impediment to the development of an effective housing finance system. It would also provide the basis for improved Government revenues through more effective property taxation. By strengthening municipal management and developing an effective property tax system, the project would also lay the basis for direct cost recovery mechanisms and replicability in the longer run. 54. The project would directly improve living conditions of about 100,000 people, or perhaps 20,000 households, representing nearly a third of the total population of Monrovia. About half of the population affected falls below the poverty threshold. The innovative nature of the project entails risks; major ones are: (a) MCC's inexperience as an executing agency; and (b) the possibility of delays in completing land adjudication, thereby post- poning cost recovery. A lesser risk is that rents increase beyond what is affordable by the target population, as a result of upgrading, thereby dis- placing residents. To minimize the management risk, the project size has been tailored to what is considered achievable and major emphasis has been placed on strengthening MCC's institutional capacity. Substantial technical assistance, training and studies would be provided. To minimize the risk that the upgrading program could drive up the rents beyond the limites of affordability, the standard of the proposed services would be kept to those considered basic only and affordable by the target population. However, rent increases would be monitored closely during project implementation. On the whole, the project presents an acceptable level of risks considering the benefits which would be derived. PART V - LEGAL INSTRUMENTS AND AUTHORITY 55. The Draft Development Credit Agreement between the Republic of Liberia and IDA and the Draft Project Agreement between IDA and MCC as well as the Recommendation of the Committee provided for in Article V, Section l(d) of the Articles of Agreement are being distributed to the Executive Directors separately. - 18 - 56. In addition to the features of the Development Credit Agreement which are referred to in the text and listed in Section III of Annex III, special conditions of credit effectiveness would be: (a) execution and delivery of a subsidiary loan agreement between the IBorrower and MCC, (b) opening of the Special Account; and (c) opening of the Project Account and depositing therein US$100,000. Conditions of disbursement in respect of expenditures for the NHSB and LWSC components, would be the execution and delivery of subsidiary loan agreements between the Borrower and each one of these agencies. The establishment of accounting and auditing systems satis- factory to IDA by agencies proposing to use certificates of expenditure would also be a condition of disbursement by means of such certificates (Schedule 1, para 4 of the draft Credit Agreement). 57. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association. PART VI - RECOMMENDATIONS 58. I recommend that the Executive Directors of the Association approve the proposed credit. A. W. Clausen President By M. A. Qureshi Attachments March 11, 1982 - 19 - ANNEX I TABLE 3A Page 1 LIBERIA - SOCIAL INDICATORS DATA SHEET LIBERIA REFERENCE GROUPS (WEICHTED AVEYGES LAND AREA (THOUSAND SQ. KM.) - MOST RECENT ESTIMATE)- __ TOTAL 111.4 MOST RECENT MIDDLE INCOME MIDDLE iNCOME AGRICULTURAL 6.1 1960 /b 1970 /b ESTIMATE /b AFRICA SOUTH OF SAHARA LATIN AMERICA 6 CARIBBEAN ONP PER CAPITA (US$) 160.0 260.0 500.0 794.2 1616.2 ENERGY CONSUMPTION PER CAPITA (KILOGRAMS OF COAL EQUIVALENT) 87.5 558.8 448.2 707.5 1324.1 POPULATION AND VITAL STATISTICS POPULATION, MID-YEAR (THOUSANDS) 978.0 1335.0 1797.0 URBAN POPULATION (PERCENT OF TOTAL) 20.5 26.2 32.3 27.7 64.2 POPULATION PROJECTIONS POPULATION IN YEAR 2000 (MILLIONS) 3.7 STATIONARY POPULATION (MILLIONS) 11.0 YEAR STATIONARY POPULATION IS REACHED 2095 POPULATION DENSITY I PER SQ. KM. 8.8 12.0 16.1 55.0 34.3 PER SQ. KM. ACRICULTURAL LAND 163.0 217.0 284.6 130.7 94.5 POPULATION AGE STRUCTURE (PERCENT) 0-14 YRS. 45.4 46.7 47.6 46.0 40.7 15-64 YES. 52.0 50.8 50.0 51.2 55.3 65 YRS. AND ABOVE 2.6 2.5 2.4 2.8 4.0 POPULATION GROWTH RATE (PERCENT) TOTAL 2.8 3.1 3.3 2.8 2.4 URBAN * 5.4 5.7 5.6 5.1 3.7 CRUDE BIRTH RATE (PER THOUSAND) 50.2 49.3 48.1 . 46.9 31.4 CRUDE DEATH RATE (PER THOUSAND) 20.3 16.3 13.6 , 15.8 8.4 GROSS REPRODUCTION RATE 3.4 3.4 3.4 3.2 2.3 FAMILY PLANNING ACCEPTORS, ANNUAL (THOUSANDS) .. USERS (PERCENT OF MARRLED WOMEN) .. .. FOOD AND NUTRITION INDEX OF FOOD PRODUCTION PER CAPITA (1969-71-100) 96.0 101.0 100.0 89.9 108.3 PER CAPITA SUPPLY OF CALORIES (PERCENT OF REQUIREMENTS) 95.0 97.0 104.0 92.3 107.6 PROTEINS (GRAMS PER DAY) 38.0 41.0 42.0 52.8 65.8 OF WHICH ANIMAL AND PULSE 9.0 11.0 10.0 16.1 34.0 CHILD (AGES 1-4) MORTALITY RATE 29.3 21.9 16.4 20.2 7.6 HEALTH LIFE EXPECTANCY AT BIRTH (YEARS) 44.4 49.4 53.5 50.8 64.1 INFANT MORTALITY RATE (PER THOUSAND) .. .. .. .. 70.9 ACCESS TO SAFE WATER (PERCENT OF POPULATION) TOTAL .. .. 20.0 27.4 65.7 URBAN .. .. 64.0 74.3 79.7 RURAL .. .. 6.0 12.6 43.9 ACCESS TO EXCHETA DISPOSAL (PERCENT OF POPULATION) TOTAL .. .. 11.0 .. 59.9 URBAN .. .. 35.0 .. 75.7 RURAL .. .. 6.0 30.4 POPULATION PER PHYSICIAN 12600.O/c 11754.5 9259.0 13844.1 1728.2 POPULATION PER NURSING PERSON 5810.1Th 4651.1 2904.0 2898.6 1288.2 POPULATION PER HOSPITAL BED TOTAL 711.8 592.0 623.0 1028.4 471.2 URBAN 181.3 194.4 .. 423.0 558.0 RURAL .. ., .. 3543.2 ADMISSIONS PER HOSPITAL BED .. 27.7 HOUSING AVERAGE SIZE OF HOUSEHOLD TOTAL .. .. URBAN 3.9 .. RURAL .. .. AVERAGE NUMBER OF PERSONS PER ROOM TOTAL .. .. URBAN 1.7/d .. RURAL .. .. ACCESS TO ELECTRICITY (PERCENT OF DWELLINGS) TOTAL .. .. URBAN .. .. RURAL .. .. - 20 - ANNEX I TABLE 3A Page 2 LIBERIA - SOCIAL INDICATORS DATA SHEET LIBERIA REFERENCE GROUPS (WEIGHTED AVE7AGES - MOST RECENT ESTIMATE)- MOST RECENT MIDDLE INCOME MIDDLE INCOME 1960 b 1970 /b ESTIMATE /b AFRICA SOUTH OF SAHARA LATIN AMERICA & CARIBBEAN EDUCATION ADJUSTED ENROLLMENT RATIOS PRIMARY: TOTAL 31.0 53.0 64.0 73.7 101.7 MALE 45.0 71.0 80.0 96.8 103.0 FEKALE 18.0 35.0 48.0 79.0 101.5 SECONDARY: TOTAL 2.0 9.0 20.0 16.2 35.3 MALE 3.0 15.0 29.0 25.3 34.9 FEMALE 1.0 4.0 11.0 14.8 35.6 VOCATIONAL ENROL. (2 OF SECONDARY) .. 5.3 3.0 5.3 30.1 PUPIL-TEACHER RATIO PRIMARY 32.0 36.0 42.0 36.2 29.6 SECONDARY 12.0 17.0 .. 23.6 15.7 ADULT LITERACY RATE (PERCENT) 8.9/e 15.0 30.0 .. 80.0 CONSUMPTION PASSENGER CARS PER THOUSAND POPULATION 1.0 11.1 8.1 32.3 42.6 RADIO RECEIVERS PER THOUSAND POPULATION 102.2 116.1 162.8 69.0 215.0 TV RECEIVERS PER THOUSAND POPULATION. 1.5 4.9 5.9 8.0 o9.0 NEWSPAPER ("DAILY GENERAL INTEREST") CIRCULATION PER THOUSAND POPULATION 0.8 5.2 4.9 20.2 62.8 CINEMA ANNUAL ATTENDANCE PER CAPITA 0.6 0.6 1.1 0.7 3.2 LABOR FORCE TOTAL LABOR FORCE (THOUSANDS) 379.8 480.4 605.8 FEMALE (PERCENT) 34.1 32.8 32.1 36.7 22.6 AGRICULTURE (PERCENT) 80.0 75.6 70.5 56.6 35.0 INDUSTRY (PERCENT) 10.0 11.6 13.7 17.5 23.2 PARTICIPATION RATE (PERCENT) TOTAL 38.8 36.0 33.7 37.2 31.8 MALE 51.9 49.0 46.3 47.1 49.0 FEMALE - 26.1 23.3 21.4 27.5 14.6 ECONOMIC DEPENDENCY RATIO 1.2 1.4 1.5 1.3 1.4 INCOME DISTRIBUTION PERCENT OF PRIVATE INCOME RECEIVED BY HIGHEST 5 PERCENT OF HOUSEHOLDS .. 61.7/f HIGHEST 20 PERCENT OF HOUSEHOLDS .. 72.67F. LOWEST 20 PERCENT OF HOUSEHOLDS .. 5.37 .. LOWEST 40 PERCENT OF HOUSEHOLDS .. 10. 97 POVERTY TARGET GROUPS ESTIMATED ABSOLUTE POVERTY INCOME LEVEL (US$ PeR CAPITA) URBAN .. .. .. 381.2 RURAL .. .. 75.0 156.2 187.6 ESTIMATED RELATIVE POVERTY INCOME LEVEL (US$ PER CAPITA) URBAN .. .. 137.0 334.3 513.9 RURAL .. .. 125.0 137.6 362.2 ESTIMATED POPULATION BELOW ABSOLUTE POVERTY INCOME LEVEL (PERCENT) URBAN .. .. 23.0 RURAL .. .. Not available Not applicable. NOTES /a The group averages for each indicator are population-weighted arithmetic mearts. 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 1964; /d City of Monrovia only; /e 1962; /f Population, higher income calculated as residual; includes expatriates. May, 1981 -21- ~~~~ANNEX I Page 3 OUIOSfliUi all SfCIAL MINCATOI Pr.L.I Althoogh Lb. otc Cr. d.o f to sooro .-oroty jodnd th. eoltS oco-fttiro ood rObt.it ohoL I- bO. Sol00. tbot Ohy -y moot bo It'- m.tio.-1y Sompooobl. b--.. of th. look of t.S.dordL.d d.ft.itOono cod -o.opt. ...d by diff ....t SoooSrS.o. ID il..otlog tb. 44t. Tho 4.0 ., Soon tb.1.66, Soo1.1 to ioS.orlb -wd.r of -moitodo. wlodtt. tr-dS, Pod obotoori.. t.l. -J... diiff-oaooo b.toSe e.oeCrioO. Tb. Iooroo top *O h1 to *SC.ocouBtry grou ofi Sb,oblore co.ot,y nodCOoconrgrprth.ed.0 tbo rt.io.toSooosy of S. ob)ot ccery._Cro for 'CatOo S. .tpl. Oil f toroor" gruP oboe. 95iddl 100000 No-h Aftic, ted Middle Z.t.e 10 Sb.-0 b- If S SoIo-ooienro Offinti... to eho rofoc- Scoop doe. th: I Sooog ..tr pott xhilotd oriUhorIc1 moor. Eo, Sotk loice.... .od oboo ocy obo mocie f cho coc-tto ion group h... dArn ta Shot Sodic.ot. Ster. Sb. -.Sr.g of-ooroo go tho di.dtcoer dopoed. - Sb. oro.ilbtity If 400 oed i. -e o-ifore ..cuttoc mooS b .-arItd Ic ro ieo ... It.. of ce tedfetor. So t.ooebS. Thb... Lcrg . cr0oyt Songit ie .tor S Sb. 01.. of oldiooeor Stn Ato ti c,S ch. ntry cod -..roc go- . tA30 ASiA. Citocood oa.ho.)- "I0.5. o HcopSeOl "a4 - Stot.l trboo. 0.4 p-r.I - PoptoUsSo (005.1 So.t. - 705.1 .or.c Cor.S. roepr.iot Iced -rn ted tolod octoro. tobn,0. --I) dlioidd by Shio- -op-cir. DW.. of bWAt.So bodo A.rrcocel- oceoo f otcSi oolo t. eo e p..t. or poomotoey ero blat to pobtic ted priroe 8-ero cod .p.nl"ood baitSelD Ce- for crp.pot.. . motb_ t nod Mitoh.: bo-=o or 00 ii.L fYlbo; 174..hbtltoto oor.KupS ISr.-b.eththoot.O p.omooely ... (0 . by SC o. St .-a pbyoii.e.. Ithloo.t poidiegptriol ..g- OP PM CAPITA (US$) - Wo . oyr oottt.o --r,r enthoc prc... o..- 41.1 Sol 000 nt tel.o. loo opol. bo=orret. tm.. oomndbooltb -Utced by .-e -cro.i.. motbd noWorld Book Atl.. (1977-79 boot.); 1960. neod "ototl roue.r 00 t :.tn fof.Cd by S phyn.ioo (hot by. 1970. tod 1979 dot.. meictI eoutneoo, _.oc. eldoitfo.t O.) hi.b off.r te-pt L-e dcti.. nod "r-id. S 1Iiecd o.. o. f .odiot for11iitoD. o- Scotai- SHERGY CMOIICOPTO PEIt CAPITA - Aoco-1 roooptioe of -aoiL1 -o.ry Cr...1 t10.1 pSrpo.oe othor boptel.o t.n1od. 0W0HO. opnioor1bpioo ted ttgoto., p-otolcn. ...rt 1 ". .ed hydc-., .oro- Iod Soi.-Mo1 nbc- ted -Jro boepittir tootorroolhpitol. tod "oirat ted -torigy triolty) to kilcgLr.e of-oo oqulotlo- par..-pit.; 1960. 1970. nod 1979 coeSor. SporIiend bo-pitoto .-o Soldod Illy no.o t0.1l. dot.. Ae.L.otrt OoL.Rc.Pito Sod - 200.1 -bo of nde1i.o So or diOo Airo hUoICtlS diridad by Sb. lob,~o ofhd.. POPCO.ATION ADO VITAL. STATISTICS Tnti1 Pprcitttc. Kid-Yoot (th c....do - A. of J.1y 1; 1960. 1970. ned 1979 ISW ftb.. -cutto (-o...ct of t... i) - 5.0io of obon to total popt.ntiool A m2occd. ..Bic.I c r of - Indirid.t Sb oboe.. blifio Iett.0 dtff.rout do tirutt. of orhc.. o oty offort roeyotbilily of doto ted tboir sin motto. A bcnrd.o or lodsrt ooy or -Y 0.t b. i.n.Idd Re AI0M ro-ti..; 1960. 1970,. td 1979 d.tt. oh. hb onSohoid for oto"ttoIrn P..,0000. Potottit i. ytt 000 - Crru P.P.lot.o projorISio Sro bo..ed 00 1980 boo f =oao pof rc Vo.1nbe n -ood ocoopiod ceoIloe.l SoeI opltln PP11 by ci;.,ed .-0 ood thoir errrll ty ted f-liltlytt-oo. dr.olli.So. o-porti-oty. 0-e111et nertd. oo-pnmo ottooICoro. ProJotiou P.rmrr for _toritly rct_ _oprin. of rhin_ tomb. .ou_ ceneopd Dolt0. IS& lhf. Soprtocy S0 blrrth c-ro.icg i0th r-tnoy'. pr ..pit. boooe A.n... to fboooirit, (ourrot If tlOfo-) - to..'so.-.. LPSol. ted Onfo. llf. onoroy -thtbeiit SC 77.5 VS.or. Th.0 p.r.- Cnetoeoao d.rlitbng 00th IototinIty ietotg905.0t 05.0 motor. f-r fert.ility rot. a1-I S ho. roo torloeo. d.cli.. to of t=0.1 oon. td -ero U0.. rootirl f..tilitynorotdicg Sc Itrom 10cc) 004 Y000 0.0117 plnoot porcmooc.. Sorb rootry1 tobrho n.l.gcnd oto of thono 01.0 -hootmol... If -lttity IMC.,,. nod foroillty trodo_ I noproJorcic P.,"poo.. Adbutod eorolleot ft0I.. -tioor,ouultio I0 c roLcooy porclttio tI r .0 reb.10. Preryohct-tto. g.0. 00 0 na - Ore.. to001. mo" So feoLo tho birch 0t.0 to .001 to oh d..rh tor.1ond .1orhoog otrtororo- eolm nI ol-ioottc rISyloo P po e..... Pof roopooSi 0.10 roouout. Th IS 10.hlodoltr. .oolyOt. dorioot prtnety ouho-ogS. poo Sie;orroly i-1lodo rhLU-n oS 6-11 01.. ropLo.on lclof ono 0 p tdrir ro..C. Ohm 00th =.Lr-io ynoo. hot .djoocd for diffotoo Inerh. of PoIety7 &SooISsISS f. of se rP.p.r. it... t Ttl, h. nenrloogr poPolaic .1 I.. ocetric nobh coi-orol .40t.510. tou.t oty Sooood 106 poo00. -.ot.etd e rho bo1o of rho poJortod rho-.torooti. rf tho poputioti 0ħ0.0 00.oPl r ho,,LSbo . 00 thrSb. offiott1 tbol oft M.. I. rho your 2000. -d b lhot.oofc dolion of f-otility Lotto to Coploco- _I040,obo -_eto. oto no fnol - C-tned to- ohor. 0000.407 moo 1,01. edttooo -Pqiro ... ...SCfo you, of opprord pIeey lomotreetd.e lea 000ħ00, 1.tltinrr IS tochd - Tb. your oboe t.ti-Coy popalttiom prnrdou $S.roI. -ociet.n tooho -rlins OeotrmetOom ft p.90 .i.. b.o hoa. -ourhd. nootI1y If 12 t0 17 ynoo- of .0.; otnOodnr neon r ISIoclly P., oc. ho. - tld-your popul.ti. p00 oq-r kilottoo (100 hMCC---) of 1aotiool ooime Sio ot of ooo oly -btniiomi 000050000 torl o. 1960 1970 nod 1979 4.0.. t-oold. Oocboi-1. ind-.cIl. or ` orhortil prgm o Ibotooo Oed,o.d- Potso.ho.ogrrol_ro lord - Comput.. no b.r. fnr ng ct.rcLS Load4 ctly -rna d.p-rtmot If ooroodoey L..tt.L-oe. pooZy; 19610. 1970 ted 1976 d,t.. P,Oltobt rti -4ro or, WeD oooedo - T,.- et.dee sou"todR poou.ttn A. trooooofr.ror~ -ChIldrou (0-14 y ..o. ), -kIg-.g. (15- NrIs ' td Soucodry1.. diridod by SromS of tooto.: 00 Sb. 64 your.) .nd rotrlrd I65 you. ted oo)n or nIeof .14-your pop...-ttt tin1.0. lot: 90 197.0.Ioud 1979 dot.. .4.1 liter.r Lot. (ouroor - Lito.-t. d.41t. (.b. on roa -4 -it.) P.oltc irot (Pr., ... oo) -ro-1 - Anno growh lo.o. of 00.0I ol- So I P-o.-,n of Stoo ... I 0I Pu.P.tol,eo .$d 15 Yo.te 0.4 000. yno popl.Oloo.. Icr 1950-WI 907.0417-9 PtouLtrto iroh hRn (.rO ) I rbr Ao`I. groh I.too If otboo PoPe- CWOOSWTIE lotou for 19 l ., 50-60.t1960-70. .rd 1970-79. P,:= :,0 nt C, oo,th-nond oDoUotoIee - p..owe,e LSr. eoi.- oa000 tro. Birth h.Sr ...tto. fd) -. Aot1 lit. biotho pot thcooced of oid-y,-nr nolg1. thou olghO potonmo oerlo. Dow.oooo boo.. 0.4 popolttorloc 1960. 1970. ted 1979 dt0.. fhitocy ouhOol... Cloud.ot tto (;rotb_ roocd) - Ato-oI d00-b. p.r thooted. of .l-ytt101 brtror foot thoonoe Pooootlat ) - All ty.mo f --I-.eo foe onus poo.r =16. 90 .. 99 oo bodot. 00 8_1ro pabli. pot tbeotoed of pDoltoo ISod.o n, Cr t crdoro .O-A.og -.btt doghornI _00 wII boor L. I Ioeod trirr 10 -.I..0 -d in Yoo obs rgout-tmii .4 toI. b.t --rmI ..Prodotl. P"riod if oh. .npcc-n ponono n-oeof100n- 00.0 to of Ofolte; d..n for .orne yooe moq, ou ho n..F.. la 000 tility oat...; Soctly fit.yo LSS.t5. Soudbo to 1960. 1970,. td 1979 sIDt oa,ttIoo tolhod IIonelig. bal,Plono A .. eot. sc t (Obuoadt.)- A-1nuolebor .0 -rrpotraT ooIo.CotSno poo.l-Oim -.T -9rrI.SV for bpo.doo 00 Otmi, Poonno Ono. Iorror f Vmttedeoc).- Po.o.o.gC oS. sorted -sroaSin 00d 00 yoo.. h.. fte tr-ti.. of TV eSt. -C I effort, -us of child-boorIo nsa (15-64 your.) hbo .oo btrt-b-o-ro d-itOn t0 Betoo CioLotito Co.t tbo.oood ouol-ioo) - Ohm. th. 09.00 Ot oIl Snrrltd no 10 one ag. StooP. m a%--doof 0001 noonro. IIetorte -."oP-p". defne noI So IP-oo peblIontio d-,ed prienil to C. Co. CAt goonrol .n. It 1. SoeIDSnemi IOo AIM OUTITIOU 0 ho -do11y If it app-Dr no 10.0 foo 0 C0. 'so. W.40 of ?r0d Pedu-tion Pur C.rit. (1969-71-1000 - Oodou of p.r ..900i no,. C0o Anoo1 Att.odcouo "ur Cnt.Pler boo - .d te b. SSAL of pCod otoo. of .11 food ro-edltioo. Poodotion ou1ed.n S.d ted foed Sod ti.Cht mold d-or8tg h. yroll oldo edoim . 4010.-I. l 10 I0 oc1-d-r your booto. CSoidtto co priodty Soodo flo . ootooo 0.d mobl. Soalt. itotnd of ou.t) rhi.h ao adibl.'o on rtinort. (orrff oote 000ar orlde).Aur-ior tro..d-tio 00 oorh..coty ID bc..ad -5LAO& OO 101 oot IIt.ers p.odocor prir- cItht.; 1961-65.1 7o70. d 1979 dttt. T.-t Ltbt PonF. hood - bteIottly ortir. P.-0. SorbodOta Po 0.0tcc ....l of raoro (erae f -ooro t.) - CoSpcomd Uro teedfree0. tnlYod hotCoe ods ho-neioos Coednet. Vo.. DooatSy oqotroto of tot f cd trylO. S_otlblo 00 -ot" t-y. -pi.o nortlg P.PI.tnOlo of AU1 tat. ft5.10.155c . iStao.i noneenps or P.. day. A-oLobl. ..ppli.. -.mort. doontir rr_d-ro., ħ0p,00. lone out onatr.bl.; 1960. 1970 -4 197 0. ,,P,, td boo o tr.Ot oplo.004 cot od oeeIel Cooc)- co- lbo oc o ooePo f001loo ea qotIIto od to food pc.tt. cod boI tdL itbuo. tcita A.Tio-lt... Co-r-o - Lobor for.. I0 fontsg. U-oty. fratia -Ad mon. -ur ..titoed by PAo bh...d oc phyolotoir-l nod. f-r no 1a 001- fiebln C. Poorot.n.. S.of totl. cbor forte; 0940. 1970 ad 1979 4.S.. ,fSy ted benith onoutd-rtg trroeo tl o.....cr.. body weight., . ta lderu Coorrot) - Lobor f-rr- Se.t. rmtuto . nfotorfta .,Sodl0 dħot.ibottoc of tr o. ad tllootc 10 porroct ctf. 0000 O I-d oct Irtoy. Sou- ted So. oa P.---ua. If t0001 lobor fort; 1940, booobd1001 11-51970.td197 at. 1970 cod 1979dSt Por 00100 rtl of r Sioħ (ot-e tot do,) - ProetS1 OOoOOct of Pot raPet. Poretrpiouio 3.0 (Peolle C e,ml,ta a trtto mo out oupply of ford p.r d.y. cot ..pply of food IS doti tod 0tho. S.- ocIoty C.--- .rcreo.d* oot oe .0d Onetl Itbo forot ISo qobrno Co f.11 rIt o--I.. -btthi.bd by US0A0V itrd. f 00 Loj.otor . e.gooaIf -.0001. sItne fesln "--I poedtteo 010- ta. PootoreroO P.looert f 60 Sine. of tort1 protoo S.r dty nod 20 Cota of cr10.l ted 1960. 1970. cod 1979 400.. Thomo t- USAg - US0. p.oiioIpc010 000- pl.op frtt., of chir 10 Zoo ool hoonmo prtoOt. 2T . o"te- .ofle-ieo oS.-o -OOo-t If tho poPoItotio . td Iota t'e- C-. A nod.oro ororobtc0100 of 5 *ro o ot- -toote.d 23 LOn of Coo S OintO. 000 foe -oncal.ozc 0.0001 p-ot.in otcor for -h uId, -ropOd by T60 I0 Mh Third t,oso CM V ooed..ttlS a - Loll. If pp.pnlao1 1eo 5 60d.04 00d Sott Poo Sooy;196-65. 1970 no 0977 d00.. 00O.000lbrf_.co. P.r ociotr. i *r to o I . cnml ned "IS.0 -fPotnil ouppty of foad do- tiedfo.noel-nd 0,10.I ,to a s;061-65. 1070 Lo 970. teorc Otto fact dotiod ro . ob.; 1960 197 cod: 0979 4.0S ofdb197.abdt LioOtotn_OOtb or)-Aara nhr fytoo tiCU--d.h 0-lb , retIng ft fcl0ti001.0.. - (both Ly ..,nxoro .o.ooned -f nR-. y 10d000 UATo btrh 106.1970 fl04if 1979 d 16017tod 97 dt. ned oh-.1.d.h.oayo. tbentdrbonni Lif.o Itttlt a.(o hcnd A-.co. doobo Ifo of10.0 oldf S on. loct bomoo T Abt1-L oclo ot.. . Soielate COO ISrtorID If p- nhendy nt o000tO hornit U.ttoroc0 roclt 00-i Iocn. Ifhao.E.nod.tta - y. K.odOrtMaIIty odtqo-to d0 p1th -id.-bt.l r-fod1- omoo .. hoIf yoo p.th ...ta. d oISrict. 0 oot)0throooboer. t t.nfodbn p.totno cf. WbltoAbrtm rrlotr..Ort op-trotoh rond-rdnohb rt t roft.p~ ... hoc0..o bt o. Otrt nmtethd7otoo o ho-roo o t Ao n tn .roo-o. _tooouiecon 0014tpO Ibo h.huofoo p".& boro. of Oh hoaaoi OOOotdPootOo S . holct PvoI Soro .00irreO-ob V---. th.ft -p-ti- .p.1 ti .1. .. -b ..d art) Porr...ofpoIuI1Oos nthL. :tediturnE -bo Pr , ..Pito. do=tore boo. Or- S M- diop.oporc-i L- of crf oftoh.Udbay in fSrchio o.- p.o- ftottr actoor ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ Sh I I~.gL -o Arc.. toLIcrto l.oo.1 (rrcor of roolsl.d- ,s....rAb. SC rrsO_ I IShe f orOtth.,urt. c rr hoodh cro lpol to7- tSceeoo-ofot O ro .. i . PptteP f00 oroe dO.y o.i II y 0000tI.040tL -b Id.. 1 W . S oCt0 qotiin tro. SSISI. A-hooO tootirdroty O.to mob cdS 00.1E. - orlt.cor.o- peor_ rn it000 ai_ 0000. uo -22 - ANNEX I Page 4 ICOtHMIC INDICATORS - LIBERIA GROSS DOMESTIC PRODUCT IN 1979 A2NUAL RATE OF GROWTH (7 1971 CONSTANT PRICES)! US$ Mln. S 1974-78 1979 GDP at Market Prices 890.0 100.0 1.6 4.8 Gross Domestic Investment 218.6 24.6 11.5 20.5 Gross Domestic Saving .. 12.6 Current Account Balance -113.2 12.7 Exports of Goods, NFS 551.6 61.9 -7.5 -1.3 Imports of Goods, NFS 536.6 60.2 4.8 -11.8 OUTPUT, LABOR FORCE AND PRODUCTIVITY IN 1979 Value Added Labor Force-/ V. A. Per Worker USS Mln. 2 '000 X US$ X Agricultle 328.0 35.0 324.8 47.5 1009.8 73.4 Industry- 217.0 23.0 39.6 5.El 5480.0 398.8 Services 395.0 42.0 73.5 10.7 5374.0 391.1 Unallocated 246.1 36.C_ Total/Average 940.0 100.0 684.0 100.0 1374.2 100.0 GOVER*fENT FINANCE General Government Central Government ( Mln.) X of GDP (USS Mln.) %of GDP 197 197 196 - 7 1980-814/ 1980-815/ 1976-806/ Current Receipts .. .. .. 220.0 20.8 20.4 Current Expenditures .. .. .. 220.5 20.8 15.4 Current Surplus .. .. .. -0.5 .. 3.5 Capital Expenditure .. .. .. 126.0 12.0 12.8 External Assistance (net) .. .. .. 45.0 4.3 6.1 MONEY, CREDIT AND PRICES 1974 1975 1976 1977 1978 1979 (Million US$ Outstanding End Period) Money and Quasi Money . Bank Credit to Public Sector 4.0 2.2 0.9 4.7 9.4 61.7 Bank Credit to Private Sector 72.7 76.8 83.1 109.2 132.1 146.3 (Percentages or Index Numbers) Money and Quasi Money as 2 of GDP . . . General Price Index (1963 - 100)1/ Annual Percentage Changes in: General Price Index 19.5 13.6 6.0 5.8 8.6 11.6 Bank Credit to Public Sector .. -45.0 -59.1 422.2 100.0 656.0 Bank Credit to Private Sector .. 5.6 8.2 31.4 20.9 10.7 Note: All conversions to dollars in this table are at the average exchange rate prevailing during the period covered. 1/ Total labor force; unemployed are allocated to sector of their normal occupation. "UNallocated" consists mainly of unemployed workers seeking their first job. 7| Over 80 percent is accounted for by iron ore. Consumer Price Index (September, November 1964 - 100). .4/ 1980-81 budget estim.ates. 5 GDP estimates for 1979 are preliminary and subject to change. 6/ Fiscal years 1976 to 1980 Not *pplicable. ,, Not available. June 1981 ANNEX I - 23 - Page 5 TRADE PAYMENTS AND CAPITAL FLOWS BALANCE OF PAYMENTS MERCHANDISE EXPORTS (AVERAGE 1978-80) 1977 1978 1979 US$ Mln. Z (Millions US$) Exports of Goods, NFS 458.0 500.1 551.6 Iron Ore 291.3 53.8 Imports of Goods, NFS -490.1 -535.6 566.7 Rubber 86.4 15.9 Resource Gap (deficit = -) -32.1 -44.5 -35.5 Diamonds 34.5 6.4 Logs or Lumber 62.0 11.4 Interest Payments (net) -6.7 -10.8 -22.0 Coffee 28.5 5.2 Workers' Remittances -27.5 -32.5 -35.0 Palm Products 3.0 0.5 Other Factor Payments (net) -68.0 -92.8 -78.8 Cocoa 12.0 2.2 Net Transfers 30.8 32.2 37.7 All Other Commodities 23.5 4.4 Balance on Current Account -104.5 -139.4 -113.2 Total 541.2 100.0 Direct Foreign Investment-1 8.1 -10.5 -58.4 EXTERNAL DEBT, JUNE 30, 1980 Net l-LT Borrowing 38.3 64.5 123.6 Disbursements 50.0 78.7 178.0 US$ Mln. Amortization -13.7 -14.2 -54.4 Sub-Total -19.8 -54.0 65.2 Public Debt, Incl. Guaranteed 533.3 Capital Grants .. .. .. Non-Guaranteed Private Debt - Other Capital (net) -35.3 79.6 .. Total Outstanding and Disbursed 533.3 Other Items n.e.i. 51.1 . .2/ Increase in Reserves (+) 4.0 25.1 -48.0 DEBT SERVICE RATIO FOR 1980-' Gross Reserves (end year) .. .. .. % Net Reserves (end year) Public Debt, Incl. Guaranteed 7.9 Fw*' and Related Materials Non-Guaranteed Private Debt - orts Total Outstanding and Disbursed 7.9 of which: Petroleum 103.2 68.8 84.6 Exports IBRD/IDA LENDING, (JUNE 30, 1980) (MILLION US$): of which: Petroleum IBRD IDA RATE OF EXCHANGE Outstanding and Disbursed 53.6 18.0 Through - 1971 Since Undisbursed 66.3 25.9 US$1.00 = 1.00 US$1.00 = 1.00 Outstanding Incl. Undisbursed 119.9 43.9 1.00 = US$ 1.00 - US$ 1/ Includes errors and omissions. 2/ Ratio of debt service to exports of goods and non-factor services Not applicable. Not available. June 1981 - 24 - ANNEX II Page 1 THE STATUS OF BANK GROUP OPERATIONS IN LIBERIA A. STATEMENT OF BANK LOANS AND IDA CREDITS (as of December 31, 1981) Loan or Amount (US$ Million) Credit less cancellation Number Year Borrower Purpose Bank IDA /a Undisbursed Nine loans and three credits fully disbursed 28.47 10.96 1055 1974 Liberian Bank for Second Development Dev. and Investment Finance 4.0 0.06 577 1975 Rep. of Liberia Agriculture 6.0 0.65 1156 1975 Rep. of Liberia Third Road 27.5 1.32 1266T 1976 Rep. of Liberia Second Education 4.0 0.38 1323 1976 Liberian Bank for Third Development Deve. and Investment Finance 7.0 3.54 1417 1977 Rep. of Liberia Education 6.3 2.08 700 1977 Rep. of Liberia Agriculture 7.0 2.73 786 1978 Rep. of Liberia Rubber Development 6.0 4.26 839 1978 Rep. of Liberia Forestry 6.0 4.33 Development 859 1978 Rep. of Liberia Monrovia Water 8.0 3.22 Supply 1544 1978 Rep. of Liberia Rubber Development 7.0 7.00 1573 1978 Rep. of Liberia Fourth Highway 13.8 0.40 1600 1978 Liberian Electric Fourth Power 10.0 0.16 Corporation / 1644 1979 Rep. of Liberia Feeder Roads 10.7 8.43 1765 1979 Rep. of Liberia Decoris Oil Palm 12.0 11.46 1076 1980 Rep. of Liberia Small & Med.-Scale Enterprises - 3.2 3.20 1907 1980 Rep. of Liberia Petroleum Explo. 5.0 - 0.95 Total 135.77 47.16 of which has been repaid 15.44 - Total now outstanding 120.33 47.16 Amounts sold 0.41 of which repaid 0.41 0.0 Total held by Bank and IDA 120.33 47.16 Total undisbursed 35.78 18.39 54.17 /a Prior to exchange adjustments. - 25 - ANNEX II Page 2 B. STATEMENT OF IFC INVESTMENTS (as of December 31, 1981) Fiscal Year Obligator Type of Busienss Loan Equity Total 1966 Liberian Bank for Development Development and Finance Company Investment 0.250 0.250 1977 Liberian Bank for Development Development and Finance Company Investment 0.306 0.306 0.556 0.556 Less Sold 0.001 0.001 Now Held by IFC 0.555 0.555 - 26 - ANNEX II Page 3 C. PROJECTS IN EXECUTION 1/ (Status as of September 30, 1981) Loan No. 1266T-LBR Second Education Project: US$4.0 Million Third Window Loan of June 7, 1976;. Effectivie Date: July 8, 1976; Closing Date: August 31, 1982 Physical implementation of the project is nesaring completion after delays due to shortages of construction materials and unusually long rainy seasons. The extension of a teacher training institute was completed on schedule and within appraisal cost estimates. Eighty-five of the one hundred planned primary school units have been completed. The technical assistance program has been completed and most of the fellowships have been awarded. The only major activity which is outstanding is the educational publications component. The overall project is expected to be completed in mid 1982, about two years behind the original target date. Loan No. 1417-LBR Third Education Project: US$6.3 Million Loan of May 26, 1977; Effective Date: July 13, 1977; Closing Date: December 31, 1983 Overall, project implementation is about two. years behind schedule due to poor contractor performance, site changes, and delays in placing fellows. The Vocational Training Center/Agricultural and Industrial Training Board, the Forestry Training Institute and three of the four Science and Tech- nology Centers should begin operation soon. The construction of the fourth Science and Technology Center will begin soon. The technical assistance program is being implemented as planned. The fellowship program for the Vocational Training Center is being implemented satisfactorily but the remainder of the fellowship program is about two years behind schedule. The project is expected to be completed about two years behind the original completion date but close to appraisal cost estimates. Credit No. 577-LBR Agricultural Development (Lofa) Project: US$6 Million Credit of August 1, 1975; Effective Date: May 26. 1976; Closing Date: September 30, 1982 Project performance continues to be satisfactLory in swamp and upland rice development with 101 percent and 90 percent of their respective targets to date achieved. About 75 percent of the cocoa targets and 58 per- cent of coffee targets were met. The main reason for these shortfalls were the temporary disturbances in field operations in May and June 1980 following 1/ These notes are designed to inform the Executive Directors regarding the progress of projects in execution, and in particular to report any problems which are being encountered and the action being taken to remedy them. They should be read in this sense, aLnd with the under- standing that they do not purport to present a balanced evaluation of strengths and weaknesses in project execution. - 27 - ANNEX II Page 4 the April change of government and shortage of planting materials. The performance of the completely Liberianised Senior Staff continues to be satisfactory although the Cooperative and Agricultural field staff needs strengthening. A Bank mission appraised a second phase of this project in June, and a Credit proposal is being prepared. Credit No. 700-LBR Agricultural Development (Bong) Project: US$7 Million Credit of December 29, 1977; Effective Date: March 15, 1978; Closing Date: December 31, 1983 Project performance continues to be satisfactory. About 100 percent of upland rice targets, 13 percent of swamp rice targets, 100 percent of cocoa targets and 85 percent of coffee targets, have been achieved. The project continues to face difficulties in getting farmers to develop swamp rice. Project management is adjusting to recent staff changes. Credit No. 786/ Rubber Development Project: US$7 Million Loan and Loan No. 1544-LBR US$6 Million Credit, both of April 21, 1978; Effective Date: October 3, 1978; Closing Date: June 30, 1984 Satisfactory progress is being made in the management of this project. However, improving smallholders involvement in the full range of rubber activities is progressing only slowly. A new Training Officer is being appointed and training of staff, farmers and tappers should soon commence. The Bank is considering amendments to the project scope and design, to include processing facilities. Some 90 percent of project targets are likely to be attained for 1980/81. Credit No. 839-LBR Forestry Project: US$6 Million Credit of July 28, 1978; Effective Date: December 20, 1978; Closing Date: June 30, 1984 There has been a perceptible improvement in staff morale since the new Managing Director was appointed. Progress is being made in the building program and the development of the trial industrial plantation site. The reduced effectiveness of the Forest Development Authority and of Ministry of Finance in collecting forest taxes has resulted in considerable arrears from concessions. This has limited the Authority's role in the sector and the plantation program has also suffered. Planting is now expected to reach only 63 percent of appraisal targets. The fellowship and training program is proceeding satisfactorily. - 28 - ANNEX II Page 5 Loan No. 1765-LBR Special Action Credit No. 35-LBR Decoris Oil Palm Project: US$12.0 Million Loan and US$2.0 Million EEC Credit, both of December 21. 1979: Effective Date: February 23, 1981; Closing Date: December 31, 1987 Project performance is satisfactory, and land development is almost on target with some 1225 ha of nucleus and smallholders land cleared. Pro- cedures for compensating farmers for land obtained for the nucleus estate are being developed. Although funding is at times difficult, Project Management continues to make reasonably good progress. Loan No. 1156-LBR Third Highway Project: US$27.5 Million Loan of August 28, 1975; Effective Date: October 14, 1975; Closing Date: March 31, 1982 The construction of a major bridge and an urban main road (5.4 m) in Monrovia was completed in 1979, and the main trunk road (83 m) was substan- tially completed in May 1981 after delays due to bad weather, difficulties in the supply of materials and disturbances associated with the change of govern- ment in 1980. The feasibility studies of about 98 miles of main roads and an urban transport study of Monrovia have been completed. The Lofa County Feeder Road Unit, which became operational in January 1977, has been transferred to the Feeder Road Project (1664-LBR) after completion of the three-year construc- tion program. Technical assistance in developing the Planning and Programming Division of the Ministry of Public Works has been reasonably effective. Loan 1573-LBR Fourth Highway Project: US$13.8 Million Loan of June 2, 1978; Effective Date: September 11, 1978; Closing Date: December 31, 1982 The project includes reconstruction and impirovement of the Pay- nesville-Totota and Paynesville-Robertsfield road, road maintenance, technical assistance and preinvestment studies. Reconstruction of the Paynesville- Robertsfield road, financed by the Kuwait Fund, was completed in October 1980. Rehabilitation of the Paynesville-Totota road was resumed in September 1980 after disruptions caused by the change of government, and is now about 65 per- cent completed. Detailed engineering of the Ganta-Sanniquellie and Ganta-Tapeta roads, delayed temporarily, was substantially completed in December 1980. Due to a shortage of funds and changes in government personnel assigned to mainte- nance operations, technical assistance for maintenance has not been effective. During the last six months of their contract, the road maintenance advisory team assisted the Ministry of Public Works to prepare a study for a follow-up maintenance project. A project cost overrun of about US$9.5 million is now expected as a consequence of implementation delays and higher than expected construction costs due to faster deterioration than foreseen at appraisal of Paynesville-Totota road; Government is exploring other sources of funding to complete the works. - 29 - ANNEX II Page 6 Loan No. 1664-LBR Feeder Roads Project: US$10.7 Million Loan of April 4, 1979: Effective Date: April 30, 1979; Closing Date: December 31, 1984 The project provides for the construction or improvement and main- tenance of about 700 miles of feeder roads and for the maintenance of a further 200 miles of feeder roads. The work will be undertaken by three brigades operated by the Ministry of Public Works. While some of the equip- ment has been delivered, the project has been adversely affected by the unsettled situation since the 1980 change of government and, more recently, by a shortage of counterpart resources. Loan No. 1323-LBR Third Development Finance Company (LBDI) Project: US$7 Million Loan of October 7, 1976; Effective Date: December 17, 1976; Closing Date: December 31, 1982 Loan 1055-LBR is fully committed and should be completed shortly. Commitment of Loan 1323-LBR has been slower than anticipated (50 percent of the loan has been committed) owing to depressed economic activity in Liberia and a downturn in business investment. Following the 1980 political changes and subsequent general economic difficulties, the quality of LBDI's portfolio and its financial position have deteriorated considerably. LBDI is now concentrating its efforts on project follow-up and loan recovery. Loan No. 1076-LBR Small and Medium-Scale Enterprise Project: US$4 million Credit of January 9, 1981; Effective Date: September 14, 1981; Closing Date: June 30, 1984 Credit effectiveness and initial project implementation have been delayed by weak management in the implementing agency (NIC). The consultant study on industrial incentives and revision of the investment code is underway. The first of three technical experts will join NIC soon. Minor disbursements have been made for technical assistance only. Loan No. 1600-LBR Fourth Power Project: US$10.0 Million Loan of July 7, 1978; Effective Date: December 11, 1978; Closing Date: June 30, 1982 The project consists of expansion of thermal generating facilities by 26 MW to meet demand up to 1985, power distribution to urban poor, rural transmission studies and technical assistance for management and training. Construction of the power plant has been completed, and the two diesel units are in operation. LEC's financial performance has been severely affected by - 30 - ANNEX II Page 7 low operating efficiency. A five-man management support team started work at LEC in July 1978 as a part of the Management Improvement Program instituted under this loan. Progress of this team has been satisfactory but loan funds for this component were exhausted in June 1981. LEC is funding a one year extension from meager resources; additional funding is needed to keep the team in place after June 1982. Credit No. 859-LBR Water Supply Project: US$8 Million Credit of January 8, 1979; Effective Date: April 2, 1979; Closing Date: December 31, 1982 Project costs have escalated from $16.1 million at appraisal to $23.2 million. The Government successfully approached the Finnish Aid Agency (FINIDA) for funds to finance the local component. Construction works are now progressing according to plan, except for the raw water intake and pipeline which are pending resolution of a LEC claim for compensation. The installa- tion of standpipes in Monrovia's urban poor quarters has been completed. Unaccounted-for water remains at a high level, almost 50%. Serious revenue shortfalls continue to plague LWSC but billing and collection are slowly improving. Government funding of LWSC remains irregular and Government intends to introduce new funding arrangements based on LWSC's actual cash needs. The Management Improvement and Technical Assistance Program has not yielded expected results due to changes in top management, shortages in counterpart funds and financial constraints. The German Government is funding a continuation of the program through GTZ. LoLit No. 1907-LBR Petroleum Exploration Promotion Project; US$5.0 Million Loan of November 21, 1980; Effective Date: January 9, 1981; Closing Date: December 31, 1983. The project seeks to promote Liberia's offshore petroleum potential by financing a seismic survey; processing, interpreting and integrating seis- mic data; consulting services for the promotion, auction and negotiation of new exploration permits and technical assistance to the Bureau of Hydrocarbons and for energy planning. Project implementation is proceeding satisfactorily. The seismic survey was initiated on March 4, 1981 and has now been completed. Availability of counterpart financing may constitute a problem in the future for the implementation of the project. - 31 - ANNEX III LIBERIA MONROVIA URBAN DEVELOPMENT PROJECT Supplementary Project Data Sheet I. Timetable of Key Events (a) Time taken to prepare the project - 1 year (b) Preparation - Government with consultants financed under a PPF advance (c) First IDA mission to consider the project - February 1979 (d) Date of appraisal mission - November 1980 (e) Negotiations - August 1981 (f) Planned date of effectiveness - March 1982 II. Special IDA Implementation Action Deposit US$300,000 out of the Credit in the Special Account immediately after effectiveness of the Credit, to help initiate project implementa- tion. III. Special Conditions (i) The Government would continue to follow land adjudication procedures and compensation policies satisfactory to IDA (para 36); (ii) The Government would discuss with IDA the results and recommenda- tions of studies on municipal management urban project preparation and water tariffs within six months of their completion and take IDA's comments into account in taking subsequent action (para 37); (iii) The Government would maintain a Steering Committee under the chair- manship of the Ministry of Local Government to Coordinate and carry out the project (para 38); (iv) MCC would: maintain adequately staff and provide all necessary resources for DPD to carry out the project; employ additional specialized staff according to an agreed time table, and consult IDA on appointments to positions of Director and Division Chief of DPD until completion of the project (para 39); - 32 - ANNEX III Page 2 (v) MCC would prepare an opening financial statement in a form satisfac- tory to IDA by April 1, 1982 reflecting its position as of December 31, 1981 and would thereafter submit annual accounts of MCC operations, including a separate account of project expenditure, not later than six months after the close of each fiscal year; such accounts to be audited by a firm acceptable to IDA (para 40); (vi) The Government would maintain land adjudication teams; four of which would be assigned to the project areas (para 42); (vii) MCC would seek to improve each year the level of collection of property taxes and afford IDA the apportunity of commenting on progress made, establishing yearly tax collection targets satis- factory to IDA (para 49); (viii) The Government would open a Special Account and a Project Account and make an initial deposit of $100,000 in the Project Account and conclude a subsidiary loan agreement with the Monrovia City Cor- poration as conditions of loan effectiveness, (para 56); and (ix) The Government would conclude subsidiary loan agreements with the Liberia Water and Sewerage Corporation and the National Housing and Savings Bank as conditions of disbursement to these agencies. 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