Document of The World Bank FOR OFFICIAL USE ONLY Report No. 13824 PROJECT COMPLETION REPORT MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (LOAN 2526-ME) DECEMBER 28, 1994 Natural Resources Management and Rural Poverty Operations Division Country Department II Latin America and Caribbean Regional Office This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank; authorization. CtURRENCY EQUIVALENTS Currency tJnit Mexican Peso (Mex$) Currency exchange ratts during Implementation Year MexS/IJSS 1986 575.4 1987 1353.7 1988 2282.0 1989 2464.0 1990 2821.0 1991 2950.0 1992 3050.0 1993 3.1 FISCAL YEAR January I - December 31 WEIGHTS ANI) MEASURFS I meter (m) = 3.28 feet (ft) I kilometer (km) = 0.62 mile (mi) I hectare (ha) = 10,000 m2 = 2.47 acres I square kilometer (km2) = 0.38 square miles (mi2) = 100 ha I metric ton (m ton) = 2,205 pounds ABBREVIATIONS AND ACRONYMS AGSAL Agricultural Sector Adjustment Loan ATICOCI I Chiapas Coast Integrated 'I'echnical Assistance (Asesorfa Tecnica Integral de la Costa de Chiapas) ATP Agricultural Technology Project (Loan 3465-ME) CNA National Water Commis.sion (Comisi6n Nacional de Agua) CADRI Support Centers for Integrated Rural D)evelopment (Centros de Apoyo al Desarrollo Rural Integral) CIE'S Center for Ecological Research of the Southeast (Centro de Investigaciones Ecol6gicas del Sureste) CONAFRUT' National Fruit Growing Commission (Comisi6n Nacional de Productores de Frutas) COPLADE State Development Planning Committee (Comite Eslalal de Planificaci6n para el Desarrollo) CI'NI I Commission for the National I lydrau!ic Plan (Comisi6n del Plan Nacional Ilidraulico) I)l)R Rural Development D)istrict (Distrito de Desarrollo Rural) D)RD DecentralizXation and Regional Development Project (Proyecto de Descentrali7aci6n y Desarrollo Regional) GOM Government of Mexico IMTA Mexican Institute of Water T'echnology (Instituto Mexicano de 'recnologla de Aguas) INIFAP National Institute for Forestry, Agriculture and Livestock Research (Instituto Nacional de Investigaciones Forestales, y Agropecuarias) PACI'0 Economic Solidarity Pact PECF Economic Growth and Stabilization Pact (Programa Econ6mico de Crecimiento y Estabili7aci6n) PRO(''CATI Agriculture Training, Extension and Research Program (Programa de Capacitaci6n, Asistencia 'Itecnica e Investigaci6n) PROD)ERI'T'I I Program for Integral Development of the I lumid Tropics (Programa de Desarrollo Rural Integral para el Tr6pico I lumedo) SAR Staff Appraisal Report SARI-I Secretariat of Agriculture and I lydraulic Resources (Secretarfa de Agricultura y Recursos I lidraulicos) SEDESOI. Secretariat of Social Development (Secretarfa de I)esarrollo Social) SE'DUEl Secretariat of Urban l)evelopment and Elcology (Secretarfa de Desarrollo UJrbano y EcologIa) FOR O()FFICIAL USE ONLY THE WORLD BANK Washington, D.C. 20433 U.S.A. Office of Director-General Operations Evaluation December 28, 1994 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT Subject: Project Completion Report on Mexico Chiapas Agricultural Development Project (Loan 2526-ME) Attached is a copy of the report entitled Project Completion Report on Mexico - Chiapas Agricultural Development Project (Loan 2526-ME) prepared by Latin America and the Caribbean Regional Office. Part II was prepared by the Borrower. The project packaged investments in flood control, drainage and access roads with improvements in extension and research services. The objective was to expand the cultivated area and productivity of crops on small farms on the coast and in the central valley in Chiapas State. Production increased in both areas, mostly mangos and bananas on the coast and maize and beans in the central valley. The gains were attributed to better water control. The technical agriculture component was less successful: the extension service was dismantled during the project period, in an attempt, until now of limited success, to decentralize and privatize these activities. The PCR does not clarify whether the production increases occurred mostly on the small farms and ejidos targeted at appraisal, or on larger commercial farms. The project outcome is considered satisfactory. However, maintenance of the water control and road works has been inadequate, and their sustainability is uncertain. The desired level of coordination between the central and state governments was not achieved, and other institutional progress was disappointing. The PCR is adequate, though it should have identified the actual beneficiaries. An audit is planned. Attachment This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. MEXICO FOR OFFICIAL USE ONLY CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLEI1ON REPORT Table of Contents Page No. Preface . ......................................................... i Evaluation Summary. ii PART I: PROJECT REVIEW FROM BANK'S PERSPECTIVE 1. Project Identity. 1 2. Background. 1 3. Project Objectives and Description. 4 4. Project Design and Organization. 5 5. Project Implementation. 8 6. Project Results .10 7. Project Sustainability .12 8. Bank Performance .13 9. Borrower Performance .13 10. Project Relationship .14 11. Project Documentation and Data .14 12. Lessons Learned .15 PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE .17 PART m1: SUMMNARY OF STATISTICAL INFORMATION .25 Table 1. Related Bank Loans .26 Table 2. Loan Data .27 Table 3. Cumulative Estimated and Actual Loan Disbursements .29 Table 4. Project Costs and Financing .30 Table 5. Project Implementation Targets .31 Table 6. Project Benefits .33 Table 7. Status of Legal Covenants .40 Table 8. Use of Staff Resources .43 EBRD MAP: 18236 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT, (LOAN 2526-MIE) PROJECT COMPLETION REPORT PREFACE This is the Project Completion Report (PCR) for the Chiapas Agricultural Development Project (Loan 2526-ME) in the amount of US$90.0 million equivalent, which was approved on April 30, 1985. The Guarantee and Loan Agreements were signed on July 16, 1985. A total of $32.0 million were canceled from the loan amount in June 1988 (US$22.0 million) and August 1988 (US$10.0 million). The loan was closed, fully disbursed, on December 31, 1993, nine months behind schedule. The PCR was jointly prepared by the Natural Resources Management and Rural Poverty Operations Division (LA2NR) of the Latin America and Caribbean Regional Office (Preface, Evaluation Summary, Parts I and III) and the Borrower (Part II). Preparation of this PCR has been based on the findings of a October 1993 mission to Mexico by Bank Staff, interviews with government officials and other Bank staff, and the review, inter alia, of the project Staff Appraisal Report (SAR), the President's Report, the Loan and Guarantee Agreements, supervision reports, correspondence between the Bank and the Borrower, internal Bank memoranda, and Borrower reports. ii MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (LOAN 2526-ME) EVALUATION SUMMARY Project Objectives and Description 1. The Mexican Chiapas Agricultural Development Project (together with the parallel Chiapas Rural Roads Project-Loan 2525-ME) constituted the first phase of the Bank's support for the Chiapas Development Plan. The Chiapas Development Plan was designed to address the constraints to the development of the state--a depressed social environment, underutilized agricultural resources and lack of adequate communications --through the integration of a series of simultaneous economic and social development programs. Both projects were approved in April 30, 1985. The Bank's agricultural sector goals were to help increase agricultural productivity in land under crops, particularly of small farmers, complement infrastructure investment for support services, and promote employment-generating investments in the rural area (see para 3. 1). The need to further these goals was acute in Chiapas, one of the least developed states in the country. The inflow of Guatemalan refugees to the region in the early 1980s had heightened social unrest, mainly in the indigenous areas on the central plateau (see para 2.2). Signed on July 16, 1985, the Loan became effective on April 4, 1986. 2. The Agricultural Development Project was designed to assist the Government of Mexico (GOM) achieve its objectives of increasing: (a) the area available for rainfed crop production and intensification of crop and livestock production; (b) agricultural production and productivity; and (c) rural employment and family income. Project activities were: (a) Improve infrastructure by constructing river control dikes, drains and related service roads. (b) Strengthen administration of the rainfed districts operations by providing field offices, housing, workshops, equipment and vehicles for operation and maintenance. (c) Provide financial assistance for on-farm works, including drains, land clearing, and land smoothing. (d) Provide for construction of soil conservation structures. iii (e) Strengthen production support services, extension, research, training, fellowships, and technical services (including national and international consultants). (f) Conduct studies (basic, feasibility, marketing, environmental and socioeconomic) to provide data for this project and future development in the state (see para 3.2). Implementation Experience 3. Project implementation was satisfactory after delays in finalizing the project's interinstitutional coordination agreement to organize implementation. The main implementation weaknesses were weak organization and a lack of counterpart funds during the first half of the project's life. In early years counterpart funds ranged between only 20% and 30% of funds required for full implementation. It was only in 1990, when the National Water Commission (CNA) took over as the lead implementing agency over SARH, that counterpart funds became adequate, and the pace of implementation picked up. Despite the initial delays, the project was completed in over seven and a half years, only nine months beyond the original loan closing date (see para 5.7). The loan amount was fully disbursed, less a cancellation of $32 million made in 1988. 4. A major implementation issue was a weak implementation organization. The anticipated coordination agreement to allow decisions to be taken at the State level never became operational, because no state funds were required and therefore the State Development Planning Committee (COPLADE) had neither the authority nor the interest to play a coordinating role (see para 4.8). The weakness of the implementation organization was further aggravated by the unforeseen four reorganizations of the Secretariat of Agriculture and Hydraulic Resources (SARH), the implementing agency, during the project life. Although this could not be predicted at the time of project design, it affected the integrity of both the project concept, resulting in overemphasis on works by CNA, and of the execution of environmental studies (see paras 5.4 to 5.7). Results 5. Project objectives regarding infrastructure-supported production and productivity gains were generally achieved (see para 6.1)'. The infrastructure component's objectives were achieved at rates of 127% for dikes, 179% for roads, and 100% for drains and auxiliary structures. Project impact on land use and yields was good (see para 6.2). Due to the 1988 cancellation of 36% of the loan amount, only 64% of the target area was developed. This reduction notwithstanding, the project-financed infrastructure allowed a net increase of 10% of the project area under agriculture. The main changes were in area under beans (4,000 ha), bananas (6,000 ha), mango (9,000 ha) and livestock (8,000 ha). Crops with declining area included soybeans (-14,000 ha) and cocoa (-2,000 ha) (see para 6.3). 1 The Chiapas Development Plan objective to reduce inter-regional income disparities was implicitly abandoned with the cancellation of the Chiapas Rural Roads Project in 1988 (see para 3.1). iv 6. Productivity. Productivity and production intensity gains were impressive. In the coast there were large yield gains in basic grains, perennials and livestock. Banana yields on the coast at 34 tons/ha are among the highest in the world and revenues from this crop account for about half of primary production values in the area. In the Central Depression, the largest yield gains were in basic grains, fruits and vegetables and livestock. A total production increase of 50% was achieved with a 10% net addition in area. Much of the intensification occurred in maize, papaya, mango and livestock (see para 6.4). Average net present values calculated for SAR farm models and assuming actual productivity changes while other variables remain the same were all highly positive except for the smallest maize and bean production unit (see paras 6.5 and 6.6). 7. Employment. Although there are no specific data on the impact of the project on employment, the 10% net increase of area under agricultural production and intensification would indicate that employment impact was positive (see para. 6.7). Project Sustainability2 8. Project sustainability depends upon: (a) Balancing new infrastructure construction vs. maintenance. A strong emphasis on new construction must be tempered by maintenance requirements of the infrastructure network. (b) Cost recovery and service provision policies. Transfer of infrastructure maintenance to users groups and switch to private extension must be gradual and include training for service providers. Small rainfed farmers should continue to receive extension support. (c) Effective environmental monitoring to identify environmental impacts and implement mitigation measures when needed (see paras 7.1 to 7.4). Findings and Lessons Learned 9. The project imparted two important lessons. The main one is that an adequate implementation organization with continuity and proper interinstitutional coordination is necessary. The implementing agency must be responsible for overall implementation and have the authority and means to establish priorities for other line agencies. This lesson has been applied in the Decentralization and Regional Development (DRD I, Loan 3310-ME) (see para 12. 1). 10. A second lesson is that an adequate project budget is necessary for successful implementation. While the project appeared to have had a strong initial commitment from the government at negotiations, that commitment was not respected until 1990. The same problem has occurred with other Bank projects (e.g. the Agricultural Technology Project -- ATP, Loan 3465-ME) and is being addressed at the institutional level, i.e., between the Bank and the Borrower in a dialogue that covers all projects and sectors (see para 12.2). 2. The project, as implemented, did not include the areas where civil unrest occurred in 1994. Therefore, sustainablity of project investment is not expected to be affected by those events. MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (LOAN 2526-ME) PROJECT COMPLETION REPORT PART I: PROJECT REVIEW FROM THE BANK'S PERSPECTIVE 1. Project Identity Project Name: Chiapas Agricultural Development Project Loan No.: 2526-ME RVP Unit: Latin America and the Caribbean Country: Mexico Sector: Agriculture 2. Background 2.1 Annual GDP growth averaged 6.5% from 1965 to 1980 in Mexico, but some areas of the country remained economically depressed. An import substitution strategy was followed during this period, but as the easier possibilities of the strategy became exhausted, the Government of Mexico (GOM) attempted to stimulate the economy by expanding public sector, investment and expenditures and increasing market interventions. The strategy of domestic stimulus failed, and in 1976 Mexico experienced a serious financial and economic crisis. The major oil discoveries in 1977 and an expansion of foreign borrowing temporarily relieved the serious financial and economic problems of the mid-1970s and led to an overheating of the economy. Rising world interest rates and the simultaneous decline of oil prices forced the government to declare a moratorium on its external debt service in 1982. Associated with the government's growing indebtedness, inflation escalated from 29% in 1981 to 159% in 1987, real wages fell, and GDP growth averaged only 1% in the 1980s. 2.2 Rapid economic expansion between 1977 and 1982 exacerbated regional imbalances. As industrialized oil-producing states reached higher standards of living, the most depressed areas in the south (among them Chiapas) remained largely rural and poor. At least 65 % of the population in these states is rural, largely dependent on agriculture for subsistence. Nevertheless, Chiapas is rich in unexploited agricultural potential. In the 1980s, civil unrest in neighboring Guatemala pushed some of its indigenous Mayan people to seek refuge in the areas of like ethnic groups in the Chiapas central plateau, which heightened for GOM the priority of development in Chiapas. 2.3 The government that came to power at the end of 1982 began measures to redress the country's financial and economic deterioration, including through special efforts to promote development in depressed regions. These measures included major stabilization programs, - 2 - major trade reforms--notably joining the General Agreement on Tariffs and Trade (GATT) in 1986--and an Economic Solidarity Pact (PACTO) in 1987, renewed in 1988 and 1993 as the Economic Stabilization and Growth Pact (PECE), and which is still in force. These measures have helped reduce inflation from 159% in 1987 to 25% in 1990, and less than 10% in 1993. Among the special efforts to correct regional imbalances was the Chiapas Development Plan. The Chiapas Agricultural Development Project and parallel Chiapas Rural Roads Project, (Loan 2525-ME), were the Bank's contribution to the implementation of the first phase of this Plan. The Agricultural Sector 2.4 Mexican agriculture expanded at over 4% annually after World War II until the mid- 1960s, in excess of the population growth rate of about 3%. Output growth resulted largely from the expansion of cultivated area: irrigated area increased by 4.5% annually from 1947 to 1965, and total harvested area grew at more than 6.3%. However, between 1965 and 1980 agricultural GDP averaged around 3%, and was less than 1 % during the 1980s. The slippage in the agriculture growth rate was due to limits on suitable land for expansion, the rising cost of irrigation development, the contraction in agricultural credit availability, and the cumulative effects of the inefficient agricultural policies of the past three decades. 2.5 The main agricultural policy objective in the 1950s and 1960s had been to maintain low prices for consumers and high prices for producers. To reach that objective, Mexico had a tightly state-controlled agricultural policy with major interventions in production, credit, technology, inputs, storage, and processing. Principal policies included: (a) guaranteed prices of all major crops (maize, beans, wheat, barley, rice, sorghum, soybeans, safflower, cottonseed, copra, sunflower and sesame), thus distorting resource allocation; (b) support to inefficient parastatals in the production, processing, and marketing of cotton, tobacco, coffee, feeds, tropical fruits, seeds, cocoa, and basic grains (maize, beans, wheat, sorghum, and soybean), which also distorted resource allocation; (c) public investments in land clearing, that may have pushed agriculture onto economically and environmentally marginal lands; (d) heavy subsidies for credit, fertilizer and pesticides, irrigation, machinery, and livestock development, which induced allocative efficiency costs; and (e) fixed prices of basic foods, implying subsidies to consumers, and which covered a substantial portion of agricultural production (over 50% in 1987). 2.6 Other Government policies had indirect negative effects on agriculture. An overvalued exchange rate discriminated against the production of agricultural tradeables. Quantitative restrictions affected 100% of agricultural and industrial production, thus damaging the domestic terms of trade for agriculture. Input subsidies and the cost of maintaining subsidized agricultural parastatals added to the fiscal deficit. The net effect of indirect Government intervention was to suppress private initiative in agriculture and to retard growth. - 3 - 2.7 The economic crisis of 1982 eliminated or at least reduced some of the dual subsidies to producers and consumers, and GOM began major agricultural policy reforms in the mid- 1980s. Its chief goals were to: (a) improve resource allocation efficiency by strengthening market mechanisms and cutting government intervention in markets; (b) increase productivity by raising public and private investment; and (c) reach the poorest consumers by increasing income transfers through targeted food subsidies; and (d) put the rural financial system on more of a commercial basis. 2.8 While further reform is required in rural finance and public expenditure allocations, a culmination of these reform and adjustment efforts was the initiation in early 1994 of the PROCAMPO program, a de-linked income support program targeted to producers of cotton, rice, cardamon, barley, beans, maize, sorghum, soybeans, and wheat. The Role of the Bank 2.9 The Chiapas project was approved at a time when, because of the difficult structural problems in the sector and the sector's crucial importance for the one-third of the nation's population living in the rural areas, agriculture was a principal area of Bank involvement in Mexico. Over the ten years before the Chiapas Agricultural Development Plan was approved in April 1985, the Bank had played an important role in Mexican agriculture, lending US$2,374 million for 16 projects. To deal with the financial and economic crisis beginning in 1982, there was a strong need for structural adjustment measures. For policy reasons, however, the GOM did not opt for such support, preferring that medium-and long-term issues be addressed through a series of sector adjustment loans.' Such sector adjustment operations formed a policy package to build a supportive framework to increase the private investment necessary to spur growth. The first such loan for agriculture was the Agricultural Sector Adjustment Loan (AGSAL I - Loan 2918-ME) approved in March 1988 for US$500 million, followed in June 1991 by AGSAL II (Loan 3357-ME) for US$400 million. These loans were associated with a broad policy dialogue on agricultural prices, trade, food consumption and input supply policies. 2.10 Prior to and after to the Chiapas Agricultural Development Project, the Bank made several investment loans to help restore agricultural growth. Two of these helped to improve humid tropical agriculture. The Integrated Development Project for the Humid Tropics (PRODERITH I, Loan 1553-ME, approved for US$56 million in April 1978) sought to exploit the potential of the wetter areas by investing in drainage, roads, and agricultural extension. This project showed that farmers could significantly increase their average yields of basic annual crops though better access to extension and through proper linkages between research and extension. A second phase of the project (PRODERITH II, Loan 2658-ME) was approved for US$109 million in March 1986. This project sought to extend the methods 1. See the Project Completion Report of the Agricultural Sector Adjustment Loan (Loan 2918-ME) (June 15, 1993) for a complete list of sector adjustment loans (including hybrid operations) to Mexico. - 4 - and results of PRODERITH I to a wider area of tropical Mexico. The Chiapas Agricultural Development Project sought to apply PRODERITH principles more intensively in Chiapas. 2.11 The Bank supported several other agricultural operations designed to focus government policy on public investments and to raise sectoral efficiency. The Agricultural Extension Project (PROCATI, Loan 2859-ME) approved for US$ 20 million in June 1987, was designed as a pilot to strengthen agricultural extension and adaptive research. The Irrigation and Drainage Sector Loan (Loan 3419-ME, approved for US$400 million in December 1991) is designed to make irrigated agriculture more efficient through rehabilitation of works, new investment, and sectoral policy changes. An Agricultural Technology Project (ATP, Loan 3465-ME, approved for US$150 million in May 1992) seeks to strengthen agriculture technology generation and transfer, following the 1987 PROCATI loan. A Decentralization and Regional Development Project (DRD I, Loan 3310-ME, approved for US$350 million in March 1991) is assisting the government's largest poverty program in the four poorest states (Chiapas, Guerrero, Hidalgo and Oaxaca). An On-Farm and Minor Irrigation Networks Improvement Project (Loan 3704-ME, approved for US$200 million in February 1994) has been designed to improve the efficiency and self-reliance of the irrigation subsector through shared investments by beneficiaries and the Government. A proposed Rainfed Areas Development Project (RAD) has completed negotiations for a US$85 million loan to improve agricultural productivity in rainfed areas through rural investment to support farm diversification and technology transfer. 3. Project Objectives and Description 3.1 The Chiapas Agricultural Development Project was designed as part of the Bank's contribution to the execution of a multi-sectoral plan to develop Chiapas. Chiapas is one of Mexico's poorest and least developed states, with a per capita income of US$350, or 16% of the national average of US$2.250 in 1984. The Chiapas Development Plan, which was prepared by the GOM and adopted in May 1983, aimed at addressing the constraints to the development of the state -- a depressed social environment and lack of communications infrastructure and agricultural technology -- and was expected to be carried out in several phases over a 15-year period. At the outset, the GOM planned to focus on accelerating agricultural growth and improving the physical infrastructure, mainly roads, drains and auxiliary structures. A parallel Chiapas Rural Roads Project was presented simultaneously to the Board.2 The linkage between these projects was aimed at reducing the regional income disparities in the state. The Chiapas Agricultural Development Project was in a different area of influence and did not include rural roads other than those to be built in direct physical connection with drainage infrastructure. 3.2 Project objectives were to increase: (a) the area available for rainfed crop production and intensification of crop and livestock production; (b) agricultural production and 2. The USS22.0 milLion loan (Loan 2525-ME) was to provide the infrastructure required to assist in the execution of a program to construct, rehabilitate, improve and maintain rural roads to support the planned agricultural development activities under the Chiapas Plan. AD but 95% of the loan amount was canceled in 1988 because GOM did not follow subproject selection or processing priorities as agreed with Bank, and because GOM priorities changed from the rural roads priorities as identified during preparation. productivity in land under crops, particularly for small farmers; and (c) rural employment and family income. Project activities were designed to: (a) improve infrastructure by constructing river control dikes, drains and related farm service roads; (b) strengthen administration of SARH's rainfed district operations by providing field offices, housing, workshops, equipment and vehicles for operation and maintenance;5 (c) provide financial assistance for on-farm works, including drains, land clearing, and land levelling; (d) construct soil conservation structures; (e) strengthen production support services, such as extension and research, and technical services (including national and international consultants); and (f) conduct studies (basic, feasibility, marketing, environmental and socioeconomic) to provide data for this project and future development in the state. 3.3 The project area originally included areas in the Coast, the Central Depression and the Central Plateau. The coastal project areas were not defined other than that they be bound by the 300m and 5m above sea level (asl) contourlines: of these 255,000 ha, 90,000 ha were to be selected for full development (on-farm works in addition to drainage infrastructure) on the basis of agreed criteria. These criteria were that lands be occupied mainly by ejidos and small farmers, and be economically and environmentally suitable for agricultural production, and that the support services (credit, extension) be provided on a timely and adequate manner. The areas in the Central Depression were well defined, and included Comitan, Suchiapa, San Miguel II and Margenes de Grijalva. The area in the Central Plateau was Los Altos (7,500 ha). The last two areas were dropped in 19886. 4. Project Design and Organization 4.1 The project's total estimated cost was US$181.6 million, of which US$90 million were to be financed by the loan. The project was designed to respond to specific problems identified in the Chiapas Development Plan, support the government policy of developing the poorest areas, and meet project objectives (see para 3.2). Project objectives were shared by Government and implementing agencies. It had a clear conceptual foundation based on the PRODERITH I experience, particularly as already established in Acapetahua, which was also a Chiapas Agricultural Development sub-project area. The implementing agency was SARH, as in PRODERITH I. The project was appraised on the basis of extensive feasibilities studies of most of the project area. Further feasibility studies were to be undertaken under the project for a possible second phase project. Project components were: (a) Infrastructure; 5. SARH Districts provided technology generation and transfer services and were organized into irrigation and rainfed. Districts were later consolidated into Rural Development Districts (DDRs). 6. Thus, as implemented, the project did not include Central Plateau areas which in 1994 became the locus of civil unrest. - 6 - (b) On-farm Development; (c) Agricultural Support Services; and (d) Other Related Services as described below. 4.2 Infrastructure (US$76 million or 42% of the total project cost). The project included substantial work to control floods in the coastal areas from 5-300 meters asl and in five areas in the Central Depression and Plateau. These works included about 350 km of dikes, with associated roads, to protect farmland and rural communities, 475 km of service road construction and rehabilitation (complementing the Chiapas Rural Roads Project), 600 km of drains to remove excess surface water and control the water table, and 300 km of farms service roads with drains and 300 auxiliary structures (fords, bridges, culverts, sediment traps and crossings). 4.3 On-farm development (US$21.4 million or 12% of total project cost). The project had envisaged GOM would provide medium- and long-term credit in the project areas, mostly in Los Altos, for the construction of field drains, terraces, land clearing and smoothing, and soil conservation structures. It was estimated that about 100,000 ha would require some investment, 50,000 ha land clearing and that about one-third of the works associated with on-farm investment would consist of soil conservation works, which would benefit the community and be financed by public funds. Most of the soil conservation works would be in Los Altos, one of the poorest areas of the State, where holdings are small and fragmented (1 to 3 ha) on steep fragile soils unsuitable for cultivation without soil conservation structures. 4.4 Agricultural Support Services (US$31.5 or 17% of total project cost). These included research and extension. Research under the project was to foster closer collaboration with extension and more adaptive research to fit farmers' needs. The component was to be implemented by the National Institute for Research on Crops, Livestock, and Forestry (INIFAP), in collaboration with extension agents in SARH's rainfed districts and later, Rural Development District (DDRs). It was to be geared toward: improving yields of existing and non-traditional suitable crops to benefit from drainage investments; developing new varieties; improving farming systems and management practices; working more on forestry and livestock in marginal areas; and developing profitable technical packages. A problem identified during preparation affecting the research system was a lack of resources to cover operating costs. Under the project, that problem was to have been resolved by having all of INIFAP's incremental costs related to the project reimbursable under the loan. The public extension service operating in the project area was to be expanded under the project to avail farmers of improved technology. The project was to implement the intensive extension methodologies developed under PRODERITH I. The number of extension agents in the project area was to increase from 169 to 571, which would be appropriate to the expected increase in farm area and output resulting from the project. 4.5 Other Related Services (US$53.1 million or 29% of total project cost). These included: (a) consultant services (180 man-months) to help SARH strengthen its operations on the areas of soil conservation and support services, environmental and socioeconomic impact analysis and research, extension communications, and the conduct of pre-investment studies; (b) studies, including pre-investment, detailed farm soil surveys, bathymetric and hydrological surveys of the lagoons and permanent wetlands of the Coast, marketing requirements in the project area at full development, and periodic socioeconomic and environmental reviews; (c) monitoring and evaluation to analyze project execution, beneficiary acceptance and response to the development investment, changes in the production system (cropping patterns, intensity and yields), and environmental and sociological changes; and (d) project implementation and administration, including the construction of office space, storage and staff housing facilities, workshops, equipment for infrastructure maintenance and vehicles for construction and production operations. 4.6 The project's total cost was to be financed by the Federal Government (49%), beneficiaries (1 %) and the Bank (50%). No financing was required from the Chiapas State Government. Some 59% of the loan amount was assigned to infrastructure, 4% to on-farm development, 10% to agricultural development and 27% to other related services as opposed to 42%, 12%, 17% and 29% of total project cost. 4.7 Project Organization. The GOM stated during preparation (and later ratified in a Single Development Agreement (Convenio Unico de Desarrollo for Chiapas) their intention to use this project as a mechanism to decentralize development planning and implementation to the state level. SARH would be the implementing agency and would keep the State Development Planning Committee (COPLADE) informed of project activities for coordination of planning and programming of future operations. Representatives of producers and federal, state and local government would constitute a sub-committee, under COPLADE to coordinate and integrate the annual work program of each district, as well as monitor and evaluate project progress. SARH would follow traditional organization, management, and execution lines used in its projects in oth- rainfed areas. All infrastructure design, tendering, construction and supervision would be carried out under SARH's Undersecretariat for Large-Scale Irrigation (which became the National Water Commission --CNA-- in 1988) through the District Offices of the Resident Engineers. The Undersecretariat for Agricultural Operations would carry out operations, maintenance and technical services for agricultural production through the rainfed districts where each subproject was located (Tapachula, Villaflores, Tuxtla Gutierrez, Comitan and San Cristobal). SARH's State Representative would be responsible for the supervision, monitoring and evaluation of each rainfed district subproject. 4.8 In retrospect, the project design and organization were based on a sound concept and an unrealistic --although desirable -- organization set-up. The project concept --of integrating infrastructure and agricultural technology generation and transfer to increase farm income and employment -- was well internalized and understood by SARH, as it had been the implementing agency of PRODERITH I. The timing was appropriate in that it was consistent to the demands from Chiapas (see para 3.1). But it was unrealistic to expect COPLADE to have an active role for coordination and integrating work programs without - 8 - having any in role in assigning project funds. This was not a determinant success factor in this case. 5. Project Implementation 5.1 The loan became effective in April 1986, one year after Board presentation. Effectiveness was affected by the delay in finalizing an agreement to set up a special subcommittee in COPLADE to coordinate activities of the Chiapas Rural Roads and the Agricultural Development Projects. In fact, this difficulty foreshadowed future implementation organization problems because even when the agreement was signed by both the Chiapas Rural Roads and Agricultural Development Projects implementing agencies, it never became operational. COPLADE never played its foreseen role of coordinating agency (see para 4.7), principally because no state funds were involved in project financing. 5.2 Although project targets were met for the most part, implementation was marred by a weak organization unable to manage the overall program, and insufficient counterpart funds. After a slow start and as the new administration took office (1988), priorities had moved toward macroeconomic adjustment and away from regional development programs. This change in priorities resulted in significant loan cancellations of US$32 million (36% of original loan amount) in 1988, as well as the effective cancellation of the Chiapas Rural Roads Project. No official reprogramming of project targets followed the cancellations. In 1990, CNA became the de facto project implementing agency. Together, these changes are reflected in variances between planned and actual project implementation of each component, as follows: (a) changes in the project areas and in the quantity of works, mainly roads. Feasibility studies indicated that the minor work contemplated in the Margenes de Grijalva and Los Altos project areas (7,000 and 7,500 ha, respectively), would not yield the expected results in cropping patterns and production value, so these areas were dropped by the Government. A 1988 Bank supervision visit to Los Altos arrived to a similar conclusion. Road construction reached 179% of target; (b) non-implementation of the on-farm development component. Much of the on- farm works were to be carried out by SARH in Los Altos sub-project area, which was dropped (see para above). The remaining works were to be financed by credit which, because of the restructuring of the public rural financial system, did not become available (see para 2.7 (d)); (c) because of a reduction in the research and extension recurrent budget, and a drop in the number of extension agents (from 169 to 99) technology transfer from INIFAP to farmers was not disseminated in a timely fashion (an exception was an INIFAP's Rosario Izapa's research staff's initiative to establish demonstration plots in one project area). During implementation GOM changed its extension policy to promote private extension. To facilitate the policy transition from public to private extension (see para 5.5) CNA provided extension in Acapetahua through the Mexican Institute of Water - 9 - Technology (under CNA), and later hired a private extension group, the Integrated Technical Assistance for the Chiapas Coast (ATIOCOCH), to provide organization and technology services to farmers on the Coast (see para 7.3); and (d) partial completion of studies. Only feasibility, prefeasibility studies and monitoring of water quality studies and an environmental diagnosis for the Acapetahua Hydrological Region, one of the coastal project ares, were completed. The marketing study focusing on additional storage requirement was dropped with Bank agreement. All other studies (baseline, environmental and socioeconomic impact assessments and monitoring and evaluation) were not completed because the implementation agency lacked necessary technical skills. A Bank-requested environmental audit to assess project's environmental impacts and propose mitigation measures for all project areas is ongoing (see para 5.6) and is being followed up in PRODERITH II. 5.3 The following sections discuss the principal implementation difficulties with the operation and the lessons learned from them. 5.4 Implementation Organization. The implementation organization envisaged at preparation, which relied on coordination between SARH and COPLADE, was unable to accomplish the desired decentralization objective and handicapped overall project implementation. COPLADE could not help decentralize decisions to the State level because it did not have a role in either design, implementation or coordination as it provided no funds and had no authority over SARH. As it did not participate in the project, a joint monitoring and evaluation unit with SARH never materialized, so that the monitoring and evaluation subcomponent was not carried out. 5.5 Project implementation was adversely affected by SARH's four reorganizations. These changes were unforeseen at the time of project design. As a result, SARH did not provide leadership in on-farm development, research and extension and other related services. SARH was mainly affected by: (a) the 1988 reorganization, when the Undersecretariat of Large-Scale Irrigation was split to become CNA (officially created in 1989), an autonomous agency under SARH; and (b) the change in its extension policy from public provision to targeted public provision to small rainfed farmers and private provision to larger farmers with a cost recovery phase-in. This policy change resulted in a rapid reduction of SARH's extension staff. As a result of the reorganizations, and although SARH continued to be the official implementing agency of the Chiapas Agricultural Development Project, CNA became the de-facto implementing agency in 1990. Therefore the project became more and more an infrastructure project and the integrity of the project concept was weakened. 5.6 One of the main areas adversely affected by the weak implementation organization was the environmental monitoring and completion of baseline and impact studies. Because the coastal area projects were bound between 300 and 5 asl, CNA was not responsible for the environmental impact of the drainage infrastructure on land below the 5m asl contourline, where the impact was most important. This also meant that CNA could not be held - 10 - responsible for correcting the negative impact of the drainage works on land below the 5m asl level (CNA did introduce some preventive sandtraps in some of the major drains, but these were ineffective under the area's heavy seasonal rainfall and the sharp reduction in flood flow on the flat coastal plains). And finally, the studies to monitor the impact were not done because of lack of technical skills in both CNA and in the Secretariat of Urban Development and Ecology (SEDUE). The project foresaw that the environmental impact monitoring would be carried out by SEDUE. But neither SEDUE nor the Secretariat of Social Development (SEDESOL), which assumed SEDUE's responsibilities in 1991, ever assumed the project's environmental monitoring responsibilities. One reason was that SEDUE's monitoring was not financed by the project because it was believed that it would be part of SEDUE's regular functions. 5.7 Counterpart Funds. Project budget availability had been noted in the SAR as a project risk. GOM gave assurances during negotiations that sufficient counterpart funds would be made available in 1985, but the project became effective in 1986. Funds provided ranged from 20% to 30% of requirements during 1986-89. After two years of slow implementation, GOM requested cancellation of US$ 32 million in 1988. The level of funds became acceptable in relation to the reduced project size, in 1990, when CNA took over project implementation. After 1990, the pace of implementation picked up and the reduced project was completed in seven and a half years (nine months beyond the original Closing Date). Subsequent Bank agricultural operations in Mexico have established more explicit budget commitments, but frequently budget support continues not to be in line with what is agreed in project design and negotiations. 6. Project Results 6.1 Overall Objectives. The broad objectives of the operation were achieved: to increase production, productivity and employment by the construction of infrastructure to increase productive area, and by the generation and transfer of appropriate technology for the area developed. Farmer communities have better access to social services in the area (a direct impact of the project's rural road construction program), agricultural resources are being better used--in particular through the diversification out of extensive cattle ranching on periodically flooded lands and other low input farming systems to more intensive perennial crop growing on the now better drained lands (a direct beneficial impact of the project's drainage and flood protection program); dairy farming intensification became possible through the regular milk collection at the farm by the regional milk processing industry. There are no data on project effect on farm employment. The project's expected contribution to the Chiapas' Plan objectives of reducing the intra-state disparities was implicitly abandoned with the cancellation of the Chiapas Rural Roads Project. 6.2 Infrastructure. The project's objective of providing road and drainage infrastructure was achieved. The component achieved 127% of target for dikes, 179% for roads and 100% for drains and auxiliary structures. The roads network provided better access to markets and social services, and drainage infrastructure allowed higher intensification of agricultural production. - 11 - 6.3 Area Development. The project's objective to increase agricultural land was achieved. Due to the 1988 official cancellation of 36% of the loan amount, only 64% of the target area to be developed was achieved. This reduction notwithstanding, project area under agricultural production increased a net 10%, mainly to beans (4,000 ha), bananas (6,000 ha), mangos (9,000 ha) and livestock (8,000 ha). Crops with declining area include soybeans (- 14,000 ha) and cocoa (-2,000 ha) (see Table 6.B.) 6.4 Productivity Results. The objective to increase productivity was achieved, however the project's contribution to this objective cannot be quantified. Productivity gains were good as a result of better land and successful research results, despite the fact that the closer linkage to extension did not materialize. Research on the Coast undertaken by INIFAP on annual crops, pasture improvement and tropical fruits, resulted in improved maize varieties, in better pasture management practices, in an early-ripening mango cultivar and in one mosaic-resistant black bean cultivar. Unfortunately, there was very little research coordination at the Federal and State levels (i.e. between INIFAP's Rosario Izapa research and the State's Secretaria de Desarrollo Rural y Ecologia research on perennial crops although the stations are only a few miles away). Improved technology was not accessible to farmers because: they were not organized to receive technology and had no access to alternative private extension services; INIFAP's lack or resources did not allow them to set up many demonstration plots to show research results (Rosario Izapa being an exception); and public extension services were scaled down. There were impressive yield gains in both the coastal area (basic grains +33%, perennials +18%, livestock +73%) and in the Central Depression (basic grains +46%, fruits and vegetables +77% and livestock +105%). Current banana yields on the Coast at 34 tons/ha are among the highest in the world and revenues from this crop account for about half of primary production values in the area, with maize and mango at distant second places. In banana plantations, project drainage infrastructure allows ejidatarios (Agrarian Reform beneficiaries) to benefit from the 1992 Article 27 of the Constitution which allows joint-ventures with foreign investors, the farmers contributing land and labor and the investors capital, technology and management (see Table 6.B). 6.5 Production Patterns. The project contributed to increase the intensity of agricultural production and change the production patterns. Drainage infrastructure has permitted a transition from low-input subsistence farming systems or extensive cattle growing to more intensified production systems, including the introduction of cash crops (mostly fruit trees) in farmers' cropping systems, which are better adapted to prevailing ecological conditions. A production increase of 50% was achieved with a net 10% addition in area (see Table 6.B). 6.6 Average net present values were calculated for SAR farm models assuming actual productivity changes and no changes in original prices. The calculated NPVs using a 12% discount rate were all highly positive except for the smallest maize and bean production unit (Table 6C) and are due to production intensification and changes to perennial crops made possible by drainage infrastructure. These results are consistent with recent analysis of farm models in rainfed areas of 20 states, over approximately 6,000 ha and involving more than 1300 beneficiaries. - 12 - 6.7 Employment. Although there are no specific data on the impact of the project on farm employment, the 10% net increase of area under agricultural production and intensification would indicate that employment impact was positive. 7. Project Sustainability7 7.1 Project sustainability will depend on the GOM careful balancing of new construction and maintenance, cost recovery and service provision policies, and strengthening the environmental monitoring of project area activities. 7.2 New Construction and Maintenance. The project's new construction targets were given priority over establishing a sustainable maintenance system, jeopardizing the long term sustainability of the infrastructure network. The infrastructure component's objectives were achieved, but the maintenance record is poor. Until 1992, the project's main activity was to construct rural roads, with road densities approaching lkm/2 km2. Construction was of satisfactory quality, but inappropriate specifications may have needlessly increased the cost of maintenance because 2-lane, 6-meter wide feeder roads were constructed in spite of the low- traffic (about 30 vehicles per day), and the large-diameter surface gravel used difficult maintenance because motograders have a destructive effect when reshaping surface and more material is demanded for resurfacing than with smaller-diameter gravel. This is particularly worrisome since the Government has started to transfer road maintenance to local users groups, irrespective of the facts that: (a) the roads' legal ownership is not clear; and (b) that the farmers' access to the infrastructure is not exclusive. SARH (and later CNA) have performned little infrastructure maintenance. Bank estimates of CNA's roads maintenance expenditure are about 1 % of investment (rule of thumb is 5%), and GOM has adopted a policy to transfer maintenance to users groups. As a result, about US$1.0 million in maintenance equipment was purchased and transferred to the Acapetahua Civil Society, a large users association. The Bank has expressed concern that the farmers group may lack the financial and technical wherewithal to carry out appropriate maintenance. As a matter of fact, the project was still financing a contract for a qualified firm to perform maintenance after the equipment was transferred. The Bank has requested the GOM to submit a road and drainage maintenance policy outline, which is being followed up in PRODERITH II. 7.3 Cost Recovery and Service Provision Policies. Although the project design included features to increase sustainability through regulation of infrastructure maintenance cost recovery, it did not do so for extension services. During project preparation, the GOM issued a decree to allow production units to recover costs from infrastructure construction and operations and maintenance, in accordance with the Agricultural Development Law of 1981 and the Water Law of 1972. This policy was applied in the design of cost recovery for road maintenance and is expected to be phased-in in the private provision of extension services for larger farmers, with a cost-recovery phase-in. The GOM intends to assess a users fee of about US$9.0 per ha to finance road maintenance, but it still not clear how that will be done without clear road ownership. The success of these policies will depend on: (a) 7. The project, as implemented, did not include areas which in 1994 became the locus of civil unrest. Thus, sustainability of project investment and benefits are not expected to be affected by those events. - 13 - continued funding for road maintenance during the transition; (b) continued funding for training to upgrade the technical skills of service providers; and (c) continued extension support for small farmers. 7.4 Environmental Monitoring. Except for water quality monitoring, no environmental monitoring activities were carried out (see paras 5.2(d) and 5.6). The environmental audit is expected to assess project's impact in all project areas and include mitigation measures which should be implemented by GOM. The environmental diagnosis of the Acapetahua Hydrological Region raised issues related to the multiple use of surface water by agricultural and aquacultural producers; the mis-use of agrochemicals; interinstitutional coordination; and water quality monitoring systems. One conclusion of this study is that linkages between the central plateau and Depression and the coastal areas should not be considered in isolation. The proposed Aquaculture project preparation would address the environmental monitoring issues raised in the environmental audit (see para. 5.2(d)) 8. Bank Performance 8.1 Bank performance in project preparation and design was good. The Bank acted innovatively by helping to develop the Plan Chiapas and supporting it through two independent but complementary operations that were processed in parallel. The Chiapas Agricultural Development Project was based on appropriate prior lending experience in that it intended to replicate the successful PRODERITH I experience in Chiapas. 8.2 The project had good staff continuity and discipline. Regular supervision missions during the implementation period, notably by staff in the Mexico field office in the later years of the project were particularly good for civil works. Supervision missions during most of the implementation period were timed between 6 to 12 months during the project and had good contact with the various project components and agencies. Bank staff were in regular contact with project management during missions for other operations, and for sector work. Extensive field visits were made during supervision missions to check progress in the districts, at associated INIFAP research sites, and in project headquarters. 8.3 The most important shortcoming in the Bank performance during implementation was the failure to insist that GOM support the parallel development of the project's infrastructure and agriculture activities, including the completion of studies. This led to an overemphasis on infrastructure construction to the relative neglect of both accelerating technological change for smaller farmers, and of monitoring the possible environmental impact of improved drainage on the lands below 5m asl. 9. Borrower Performance 9.1 Borrower performance in project preparation, notably in absorbing results of the initial sector work, identifying candidate project districts, and carrying out feasibility studies was timely and of adequate quality to meet project objectives. There were several weaknesses in the Borrower's performance during implementation, however. These weaknesses were due to a weak implementation organization (see paras 5.4 to 5.6) and lack of funding (see para 5.7). The lack of monitoring and evaluation contributed to a failure to - 14 - measure if project objectives were achieved. Of special concern was the intended reliance on COPLADE, which lacked authority to effectively coordinate the project activities of the agencies involved. Another major weakness was the lack of contact between the lead project agency (SARH and later CNA) and the agencies responsible for carrying out the agricultural components. 9.2 Project disbursements. Procedures for project disbursements for works are well established and understood, but not adhered by for research and extension activities. Because local branches of SARH and INIFAP were not reimbursed for additional project activities, they lack incentives to follow Bank guidelines, gather and submit documentation for project disbursement. In the absence of inter-agency coordination, as it was the case in this project, the reporting relationship was lost and many activities which could have been carried out under the project were not. This happened despite the fact that, under PRODERITH I, specific mechanisms were put in place for resource transfers for project activities. 10. Project Relationship 10.1 The Bank-Borrower relationship throughout this project was good. The shared emphasis on targeting the poorest states continues in other projects, for instance the DRD I targets the four southern states (see para 2.11). The working relationship have been close, as demonstrated by the Borrower's request of Bank participation in the early stages of outlining a road and drainage maintenance policy and system, which is being followed up in PRODERITH II. 11. Project Documentation and Data 11.1 The legal agreements and appraisal report were generally satisfactory except for the lack of any legal requirements related to the environment. The Loan and Guarantee Agreements were amended in 1989, to strengthen SEDUE's function to assess and monitor the environmental impact of the project. - 15 - 12. Lessons Learned 12.1 The project imparted two important lessons. The main one is that an adequate implementation organization, continuity and proper coordination are necessary to achieving original project objectives. The implementing agency must be responsible for overall implementation and have the authority and means to establish priorities to other line agencies. As the Chiapas Agricultural Development Project demonstrates, an agency without a resource allocation role (COPLADE) will be unable to coordinate other agencies' activities. Also, the project demonstrates that an agency dedicated to infrastructure construction is not likely to subordinate its priorities to agricultural technology generation and transfer without the watchful eye of a strong coordinating agency aware of the importance of the other components to achieve overall project goals. For instance, the DRD I project activities are financed by matching grants between SEDESOL and COPLADE so priority and coordination are ensured. The State proposes the investment program in specific areas and SEDESOL agrees to match funds, targeting investments to poor areas (rural municipalities/communities not over 5,000 inhabitants) using agreed index and formula across rural areas to avoid concentration. Alternatively, projects should focus on activities that can be implemented by a single agency. 12.2 A second lesson is that a sufficient project budget is necessary for successful implementation. While the project had a strong initial commitment from the government at negotiations, that commitment was not respected until 1990, which was the first year of full implementation. The same problem has occurred with other Bank projects (i.e. the Agricultural Technology project) with even stricter budget commitments. The budget issue is being addressed at the institutional level, i.e., between the Bank and the Borrower in a dialogue that covers all projects and sectors. - 17 - MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (LOAN 2526-ME) PROJECT COMPLETION REPORT PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE 1. Introduction 1.1 The State of Chiapas is located in Southeast Mexico. It is divided into the Coast, Central Depression, Los Altos and Northern physiographic regions. The physical, productive and socioeconomic characteristics vary considerably among them. 1.2 In order to formulate the Chiapas Agricultural Development Project and to determine works, productivity and economic and technical feasibility, various studies were undertaken; among them, topography, hydrology, agrology, soil uses, land tenure and commercialization studies. 1.3 Project area was 317,000 ha, which was later adjusted to 288,000 ha. In the Coast region, where the Tapachula, Huixtla, Acapetahua and Margaritas Pijijiapan subprojects were located, the area was 240,000 ha; in the Central Depression, where the Margaritas Comitan, Suchiapa-Santo Domingo and San Miguel II were located, the area was 48,000 ha. 1.4 Subproject sites were selected because they offered the highest possibility of attaining project goals; their selection was based on criteria that recognized and differentiated subwatersheds, trends in productive capacity, variations in resource potential and the basic organization of technical services in the rainfed districts. 1.5 The area where the subproject sites were located has significant physical differences. Annual precipitation ranges from 1000 mm and 3000 mm during a six-month period and the annual mean temperature varies from 18C in the Comiteca Meseta to 28C in the coast. In general, the climate conditions permit growing rainfed crops such as cereals, cotton, soya, rice, sugarcane, tropical fruits and pastures. 1.6 The principal constraints for rural development were physical, technical and socioeconomic-inundations, excess humidity, lack of communication and use of traditional technologies that were not viable in the context of excess humidity and the different socioeconomic levels. 1.7 Project's principal objectives were to increase: (a) productive rainfed area; (b) agricultural production and productivity with a view to improving food self sufficiency and increasing exports; and (c) rural employment and family income. - 18 - Project Strategy: 1.8 Project strategy emphasized that emphasized the producers' participation within a policy framework of decentralization and transferring the resources and functions to users' organizations and institutional coordination. Components: (a) constructing basic infrastructure: 475 km of farm service roads; 600 km of drains to remove excess water; 350 km of flood control dikes; 300 km of farm service roads with drains and auxiliary structures; (b) constructing works and developing soil and water conservation; (c) improving technical assistance for on-farm development, leveling and technology transfer; (d) strengthening production support services, such as extension, research and technical services, including local and international consulting; and (e) undertaking basic feasibility, marketing, environmental impact and socioeconomic studies. 1.9 The strategies, methodologies and instruments used in the Project arose from the experiences from the first phase of the Tropical Agriculture Development Project (PRODERITH I), in particular, the experiences from the Acapetahua Subproject in the State of Chiapas. 2. Bank's Performance The Loan: 2.1 The Project was identified during visits by the Bank during 1982 and 1983. Its preparation was completed in February 1984. The Bank and the Government of Mexico, through Nacional Financiera (NAFIN), signed the loan agreement on July 16, 1985 (Chiapas Agricultural Development Project, Loan 2526-ME) for the original amount of US$90 million. The Loan intended to finance 59% of infrastructure; 10% of technical services and studies costs; 16% of the project administration costs; 12% of the on-farm development, extension and training; and 3% of research, monitoring and evaluation. (Staff Appraisal Report, Chiapas Development Project, Report No. 5167b-ME, 25 March 1985). Project Development: 2.2 Beginning in December 1985, the Bank undertook preparation missions for the Chiapas Agricultural Development Project. It was considered convenient to apply the experiences, methods and instruments generated in the first phase of PRODERITH, among them the Drainage Manual, Production and Conservation Plans, Local Development Plans, - 19 - and the Rural Communications System. These instruments allowed promoting producer participation and giving integrity to the various rural development components through technical and economic support. 2.3 The Loan became effective in 1986. In December 1986, the supervision missions for project execution began. Members of Bank, the Secretaria de Agricultura y Recursos Hidraulicos (SARH) and the Comisi6n Nacional del Agua (CNA) participated. They reviewed the advances made in the different project components. These missions formulated corresponding aide memoires and reported the necessary adjustments required for fulfilling the works. Bank technical staff supervised and reviewed project financial statements with the view to make recommendations and the necessary adjustments for timely disbursements. The Bank approved the previously established and agreed to disbursement mechanisms and the documentary proof. 2.4 Until 1988, the Bank noted that Project implementation had been slow due to lower budget allocation and lack of institutional coordination and indicated administrative difficulties in disbursements. Consequently, the Bank recommended in its reports to prorogate disbursement costs and to improve government agencies' intervention. Similarly, the Bank demonstrated its concern for the project's environmental impact. In September 1998, the Project management was reorganized and US$32 million of the loan canceled, leaving an adjusted loan amount of US$58 million. 2.5 CNA was created in 1989. It became the project implementing agency. At that time, the Bank noted an advance in project implementation and highlighted measures to implement actions addressing environmental concerns, especially in the high regions of coastal river basins and for maintaining the El Triunfo ecological reserve. 2.6 In 1991, 158,000 had benefitted from infrastructure development, which represented a 56% physical targets. Infrastructure for the subprojects in the Central Depression was completed except for the canalization of the Rio Grande de Comitan and in the Acapetahua and Huixtla de la Costa projects, it was estimated to reach 100%, by which the Bank emphasized its recommendations towards operation and maintenance of infrastructure and purchasing equipment for these ends. The efforts of producers who contributed resources and labor are recognized. Similarly, it is valued satisfactory the technology generation results and their application to maize, mango and cacao and pasture, although it must be indicated that there were limitations in technology transfer due to personnel reductions in the extension services. 2.7 By the November 23, 1992 Supervision Mission, 75% of physical targets had been achieved, supporting the GOM's request to extend the closing date to December 31, 1993. 2.8 In November 1993, the last evaluation mission was carried out and Bank's consultants expressed their satisfaction for the opportune attention to its recommendations as well as to the auditors' observations. - 20 - Conclusions 2.9 The Bank carried out supervision and inspection missions systematically. The Bank monitored the advances made and followed up the other actions of the various project components. These factors contributed to applying solutions with the principal aim of attaining the stated objectives. 3. Government Performance. Institutional Aspects 3.1 The Project was prepared in 1983 in order to meet the development needs of the State of Chiapas within the framework of the National Hydraulic Plan (1975 and 1982). This plan identified the Gulf and Southeast Zones of our country as regions of high and medium potential for commercial agriculture. The Project took into consideration the experiences, methods, instruments and the human resources developed during the first phase of PRODERITH, in particular in the Acapatahua Project in Chiapas. 3.2 The National Hydraulic Plan Commission (CPNH), under SARH, prepared studies and plans. It received support from SARH's Studies Directorate, SARH's state office in Chiapas, the Government of the State of Chiapas, as well as from the State Development Planning Development Committee (COPLADE). Project Development 3.3 In the National Development Plan (1983-1988), the Government indicated the need to make special efforts to promote development in those regions with relatively less development. It gave the State of Chiapas a high priority. In 1983, the Government announced a multisectoral development plan for the State of Chiapas as part of its strategy for regional development. It emphasized the activities required for agricultural growth, infrastructure development and roads. It was a high priority project; its regional development strategy sought to increase agricultural production, accelerate economic growth, alleviate poverty, and correct socioeconomic imbalances. 3.4 The Bank and the Government of Mexico signed the Loan Agreement, which would be administered by NAFIN, and a Loan Guarantee Agreement on July 16, 1985. 3.5 The SARH state office in the State of Chiapas was responsible for coordinating, supervising, monitoring and evaluating each of the subprojects of the rainfed districts. The SARH state office was responsible also of informing COPLADE of advances and obstacles during project instrumentation so that the latter agency would be able to take the necessary steps to overcome them. Operations would be carried out through SARH's Directive and Technical Committees of the Rainfed Districts. 3.6 SARH relied upon various dependencies to carry out specific tasks related to rural development: (a) General Directorate for Large-Scale Irrigation; (b) General Directorate for Production and Agricultural Extension; (c) the national institutes for agricultural, livestock - 21 - and forestry research (INIA, INIP, and INIF); (d) the General Directorate for Soil and Water Conservation (DGCSA); and (e) the National Fruit Growing Commission (CONAFRUT). The Credit would be channeled primarily through the Agricultural Trust Fund (FIRA) and the National Rural Credit Bank (BANRURAL). 3.7 The National Development Plan (1983-1988) defined a decentralization policy which required structural reforms such as streamlining government apparatus, in order to improve efficiency and promote a reorganization of institutional services. The greater part of the Project's life was conducted under the application of the Agrarian Reform and the Water National Laws, which were modified in the last phases of the Project since their predecessors had failed to respond to the new conditions related to soil and water use that the country required. 3.8 By virtue of the fact that COPLADE undertook general coordination tasks in the State and the Project required particular attention for its instrumentation, COPLADE's contribution to decision making decentralization was slight since it did not contribute project investment funds. As a result, it did not have relevant input for project design, instrumentation and coordination. 3.9 Through the rainfed districts, SARH accomplished technical assistance and conducted project execution. Later on, Rural Development Districts (and within them, Support Centers for Integral Rural Development (CADRI)) were developed within each subproject under the National Program for Integrated Rural Development (PRONADRI). Its action had a focus based on the model created by PRODERITH, although there was a significant decrease in its personnel. 3.10 Research tasks were reorganized also: three national research institutes (agricultural, livestock, and forestry) were combined to form a single National Institute for Forestry, Livestock and Agricultural Research (INIFAP), which maintained continuity in its tasks of generating technology within a larger, integrated framework. The Mexican Institute for Water Technology (IMTA) was created for research, technology development and transfer and training for technical and professional personnel in water related matters; it had a significant role in systematizing the methodologies generated in PRODERITH's first phase, in training and creating methodologies, as well as in technology transfer for water and soil conservation. 3.11 SARH'S General Directorate for Large-Scale Irrigation, through its Residencias de Construcci6n (Construction Offices), undertook infrastructure design, construction and supervision. In accordance with the procedures of the Public Works Law and its Regulations, these were undertaken by competitive public bidding. 3.12 Until 1988, the Project development was below what had been programmed, resulting in partial loan cancellation. Carrying out and coordinating the Project improved, as the economic crisis abated, after creating CNA and sensibly increasing budget allocations. These made it possible to advance rapidly in constructing infrastructure, acquiring machinery and equipment for conservation and linking the infrastructure program with technical assistance and research. - 22 - 3.13 Beginning in 1989, investments were concentrated in the Acapetahua and Huixtla Subprojects with the aim of avoiding dispersion, consolidating close areas and achieving significant short term results. 3.14 CNA undertook to propose the country's water policy. It formulated the National Program for Irrigation and Drainage (1990-1994) within which were established the strategy and procedure for construction, operation and maintenance of water works and required actions for their integrated use. Under the framework of CNA, the Drainage Districts Management Office was created. It would serve regions with hydroagricultural infrastructure. It would also promote full and efficient uses in the tropical and subtropical coastal plains, so as to better production and living conditions and coordinate actions among the Chiapas Agricultural Development, the San Fernando (Tamps.) and PRODERITH II Projects. 3.15 The Drainage Districts Management Office prompted the users towards greater participation in hydroagricultural management, as it sought to transfer to their organizations tasks related to operations and maintenance. 3.16 With CNA's creation, the infrastructure construction tasks were executed by the Construction Management Office of the General Subdirectorate of Hydroagricultural Infrastructure. These consisted of various contracts for supervision, goods and services which were assigned to various firms and whose performance can be considered satisfactory. When it was necessary, the recommendations and auditing remedial actions were undertaken, reaching satisfactorily the fulfillment of physical objectives. 3.17 Upon the opening of new possibilities for agricultural development, technical assistance was carried out through various means. While some commercial houses cultivated vegetables, other private firms managed the technical aspects of high value crops such as banana and tobacco. The actions of official institutions became limited to dealing with basic crops and the African palm. 3.18 Faced with the lack of technical personnel capable of dealing with the various aspects of the Project's development related to the improvement of infrastructure works, CNA fostered creating and operating a Technical Cooperation Unit (TCU). It undertook direct sales in accordance with the existing govemment procedures. Over time, the TCU became a private enterprise dedicated to technical services for rural development. 3.19 In order to deal with environmental problems, IMTA and the Soil Conservation Service undertook an Agroecological Study of Acapetahua, which related the problems of erosion and the obstacles it places on infrastructure. Together with the TCU, an environmental impact evaluation was undertaken of the central region of the Chiapas coasts. The ample participation of various institutions and social groups led to identifying and generating consensus about the principal environmental effects of the actual technological practices in the different physiographic zones. At the request of IMTA, the Southeast Ecological Research Center (CIES) undertook the Ecogeographic Study of the Acapetahua Watershed, from which emerged a long term proposal for integrated watershed development. - 23 - Neither SEDUE nor subsequently SEDESOL had the expected environmental aspects intervention since neither was able to receive the additional resources to carry out their tasks. 3.20 The new Agrarian and National Water Laws were promulgated during the final phase of the Project, which fostered conditions for greater economic, financial and social participation for the beneficiaries for administering the Project and its benefits. 3.21 In respect to the specialized technical consultant services, its activities had the basic object of consolidating the process of transferring the resources and functions in order to achieve a greater efficiency in using available resources and a greater beneficiary participation. In addition, work has been done in improving production organization, using sector programs and developing and advising producers primarily in soil and water conservation practices. 3.22 All the activities were directed at increasing production. Its impact is reflected favorably in yields increase. This is due to the technology transfers that were tied to infrastructure works and the agricultural research that developed varieties designed to attain an optimal production under the region's climate conditions; and which formulated recommendations as to densities for sowing, fertilizer use, soil preparation practices and the use of modem agricultural inputs. 3.23 Modifications in soil use were established based on the comparative advantages territorial improvement offered; as a result, there were no substantial changes in annual crops; areas with perennial crops, however, were expanded significantly. 4. Results 4.1 The Project's general goals were met. In infrastructure, mainly, 27% more roadside borders and 79% more roads were built. The Project's impact in relation to the soil use, production, productivity and employment was improved substantially, influencing decisively infrastructure construction and the use of methods and work instruments generated in PRODERITH I to promote producer participation and technology transfer. During the period analyzed, the area dedicated to agricultural activities increased 10% for 133,000 ha to 146,000 ha. The principal changes were in the surface areas dedicated to beans which increased 176%, for banana (83%), for mango (335%) and livestock (41%). Crops which decreased included rice, which decreased by 88%, soya (62%), sorghum (47%) and cacao (about 19%). 4.2 The territorial improvements that promoted substantial modifications in soil use also allowed for increases in agricultural area, production and productivity. 4.3 Even when there are no specific data as to Project impact on creating jobs, it may be inferred that if the agricultural limits increased by 10% and that soil use intensified, then there was a favorable impact. Infrastructure construction and the means to promote producers' participation also influenced installing public services for producers' social welfare in the Project area. - 24 - 5. Conclusions and Recommendations 5.1 In light of the results obtained, Project execution constitutes a success both in its contribution to national production as well as in its favorable effects on beneficiaries' income and in employment generation. It is very important to continue complementary activities that would permit Project consolidation. 5.2 The actions designed to commit user participation towards corresponding infrastructure maintenance must be reinforced. The annual program for operations and maintenance should be applied, avoiding postponing conservation and instead, seeking normal conservation. 5.3 Specialized technical consulting services must be continued, in all their productive aspects, with the aim of obtaining more profitable agricultural activities which would provide greater benefits to the producers (who would administer and cover the costs of technical consulting). 5.4 Environmental impact monitoring should be continued and strengthened and preventive and corrective measures should be implemented that would allow for a sustainable agricultural development. 5.5 Project experience should be applied to new development zones in the State of Chiapas, throughout the nation and in other countries. - 25 - PART mII: SUMMAY OF STATISTICAL 1 IFORMATION - 26 - MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 1. RELATED BANK LOANS Year of l Approval and Loan Title Purpose Amount Status Comrnents PRODERITH I Tropical agricultural 1978, for US$56 Completed Successful project with follow up development mrillion (PRODERITH II) under implementation. PCR No. 5997 was issued in December, 1985 Chiapas Rural Roads 1985, for Completed 95 % of loan amount canceled in 1988 Rural Roads USS22.0 million GOM did not follow sub-project selection or processing priorities as agreed with the Bank, and because GOM priorities changed from the rural roads priorities as identified in preparation. PCR No. 9406 was issued in March 1, 1991 PROCATI Agriculture 1986, for US$20 Completed PCR No. 13157 was issued on June 15, development and million 1994. extension PRODERITH II Second tropical 1986, for Under Budget problems; loan amount is now agricultural US$109 million implementation US$88.3 million after cancellation. development Expected Closing Date is December 31, 1995. First Support reform of 1988, for Closed in 1990 Operation completed successfully; PCR Agricultural agricultural policies US$300 million issued June 15, 1993 Sector Adjust. Regional Assist the GOM's 1991, for Under No major problems; follow up project Decentralization poverty program in US$350 million implementation being prepared. and the four poorest Development agricultural states Second Support continuing 1991, for Completed Successfully completed. PCR sent to Agricultural reform of agricultural US$400 million OED on June 29, 1994. Sector Adjust. policies Irrigation and Support irrigation and 1991, for Under Budgetary difficulties but no other major Drainage Sector drainage investment US$400 million implementation problem. Agricultural Agricultural research 1992, for Under Significant budgetary problems. Technology and extension US$150 million implementation On Farm and Irrigation 1994, for Approved by Awaiting effectiveness. Minor Irrigation infrastructure US$200 million the Board on Networks improvements February Improvement 17,1994 Rainfed Areas Improve agriculture Proposed USS 85 Approved by Awaiting signing. Development productivity million loan the Board on amount July 12, 1994 - 27 - MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 2. LOAN DATA (US$ millions) Original Canceled Disbursed Repaid Outstanding 90 32 58 31.4 28.8 (as of July 1994) PROJECT TIMETABLE Original Dates Actual or Re-estimated Dates Regional Study December 1981 16 August 1982 Identification September 1982 20 September 1982 Preparation July 1983 20 July 1983 Appraisal Feb/March 1984 March 1984 Loan Negotiations February 1985 25 February 1985 Board Approval April 1985 30 April 1985 Loan Signature July 1985 16 July 1985 Loan Effectiveness 15 October 1985 4 April 1986 Project Completion 31 March 93 31 Dec 93 Loan Closing 31 March 93 31 Dec 93 Source: Staff Appraisal Report and Division Black Books Comments at each stage of project cycle Identification: No special comments Preparation: No important delays Appraisal: No important delays Effectiveness: Delays due to participating agencies' difficulties in signing a coordination agreement and as a result of lost documents during earthquake Closing date: The closing date was extended once, from March 31, 1993 to December 31, 1993 because of disbursement delays - 28 - MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 2. LOAN DATA (continued) Project Schedule Quarter 2 3 4 E Year 1982 1983 1984 1985 1986 1987/92 1993 Identification Preparation 3 Appraisal Mission Negotiations Board Approval 3 Signature Date 3 Date of Effectiveness >>I Completion Date T>>>>> Closing Date >>>I Year 1982 1983 1984 1985 1986 1987/92 1993 Quarter i2 3 ff41f11i131411121314 Scheduled: Slippage: > > > > Actual: X - 29 - MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 3. CUMULATIVE ESTIMATED AND ACTUAL LOAN DISBURSEMENTS (US$ million) Bank FY 1986 1987 1988, 1989 1990 1991 1992 1993 1994 (i) Appraisal estimate 7.5 18.0 32.0 46.0 61.0 77.0 85.5 90.0 90.0 (ii) Estimate minus previous FYs cancellations 7.5 18.0 32.0 24.0 29.0 45.0 53.5 58.0 58.0 (iii) Actual 6.2 ' 9.0 14.0 16.7 18.2 27.0 34.6 49.8 58.0 (iv) Actual as % of (i) 83 50 44 36 30 35 40 55 64 (v) Actual as % of (ii) 83 50 44 70 63 60 65 86 100 1/ US$22.0 million were canceled from the Loan on June 20, 1988. 2/ US$10.0 million were canceled from the Loan on August 10, 1988. 3/ Including US$ for retroactive financing of expenditures incurred after July 1, 1984 for civil works and after January 1, 1985 for incremental salaries for research and extension staff. - 30 - MEEaCO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loean 2526-ME) PROJECT COMPLETION REPORT TABLE 4. PROJECT COSTS AND FINANCING (USS Millions) Total Project Cost Loan Amount __________ Planned Actual Revised at Percent of Total Actual Loan Category Amount as a % of Planned cancellation Project Cost to be Amount as a 1 (estinate) Actual Planned Amount in 1988 Actual Financed by Loan Actuial Coas | (1) (2) (3) (4) (5) (6) (7) (a) I. Civil Works for Dikes, 82.9 62.06 75% 58.0 44.3 44.0 70% 71% Drains, Roads, Buildings and Soil Conservation, including Engineering Designs _ _ 2. Goods including 20.0 3.22 16% 11.0 5.1 2.4 90% of local and 75% Equipment, Materials, 100% of FE Spare Parts and Vehicles 3. Consultant Services, 5.0 7.2 144% 5.0 5.5 6.6 100% 92% Studies and Trasining _ _ 4. Incremental Salaries for 18.3 9.92 54.2% 7.0 3.1 5.0 10O% until 50% Research and Extension 6/30/87; Staff 50% until 6/30/89; and 25% thereafter (changed to 100% _________ _________________________ ________ on 11/15/89) _ _ _ _ _ _ _ 5. UnaBocated 55.4!' 9.0 6. CanceBation 32.0 32.0Y 7. Special Account TOTAL 181.6 82.40 45.4% 90.00 90.0 90.0 So.e: SAR CNA, Bsk Eaxtst- Y Drcrp.cy botween SAR txt Rad smounLr per finocing of disbusemebnt cstegonm. - 31 - MEICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE S. PROJECT IMPLEMENTATION TARGETS Component II Indicator | Appraisal Revised Ftl Percent Percent of Co nr usco IdctrEtmt I I toof revised Iappraisal Dikes Flood control dikes 350 km 571 km 445 7S 127 Roads Service roads construction and rehabilitation 775 km 1671 km 1390 83 179 INFRASTRUCTURE Drains Prirnary and secondary drains 600 km 1101 km 614 56 102 Structures Auxiliary structures (fords, bridges, culverts, 300 300 100 100 s sediment traps and crossings) _ _ _ Field Offices Field offices to provide office space. storage 6 7 3 43 50 and staff housing: 2 in the coastal subproject areas and I in each of the 4 central depression subprojecl areas _ _ Workshops Buildings for workshops, staff housing, and 6 3 50 equipment and spare parts storage l ADMINISTRATION l[ AND OPERATION Equipment Equipment to operate and maintain the road 52 mnachines 13 25 for network, drainage and dike systems and infrastructure structures maintenance Vehicles Vehicles for construction (37 pick-ups) and 112 112 100 production operations (75 pick-ups and 240 4-wheel 4-wheel motorcycles) vehicles vehicles ON-FARM Medium and Investment for on-farm development 100,000 ha 100,000 100 DEVELOPMENT Long-term Land learing 50,000 ha 0 0 Credit Ladcern5000h _____ = Extension Increase number of extension staff 571 99 17 Research Improve research stations (Rosario Izapa, 3 stations 3 100 Centro y Costa de Chiapas) l l l_l_l AGRICULTURE Training Extension staff 1200 1200 100 SUPPORT Courses in farmer organization, improved 3000 farmerl NA NA SERVICES production techniques, and maintenance of drainage infrastructure Fellowships for intensive local or overseas 12 mnan-years 12 100 training l l l _l_l_l ______ _- = - 32 - MEXICO CIIIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 5. PROJECT IMPLEMENTAITON TARGETS (Cont.) Componsent ][Subs:tr Indicator Status at SAR Status at Project CompIeton Basic anBa si c and Feasibility studies on 205,000 ha of Completed feasibility the 255,000 in the coastal area STUDIES studies in th[ Studies for 50,000 remaining ha in Tapachula Completed Project Area Studies for 55,000 ha in central depression Completed and 7,500 in Los Altos Monitoring Monitoring of water table Not carried out of the Water Table and l Ground Ground water study in project area as well as Monitoring of water quality completed in 1992 Water in areas of future development to determine Surveying the availability of and quality of water for domestic consumption and supplementary irrigation Survey of the Hydrological and topographical surveys of Will not be carried out Coastal the coastal lagoons and adjacent permanent Lagoons wetland areas Monitoring Monitor and evaluate the effect on the water Will not be carried out and table of drainage and river control on the Evaluation of Coast with respect to design of infrastructure the Drainage and effect on crop production, particularly System the second cycle crop Soil surveys Soil surveys to determine overall Will not be carried out reclassification of soils for future optimum land use planning _ _ Chiapas Pre- Pre-investment studies on the more of Completed for 612,000 ha (260,000 ha under the Investment 600,000 ha under the project and 300,000 project) Studies for additional ha Future Development Environment Environmental impact studies of Environmental Audit by Center for Ecological al and infrastructure program and changes in Research of the Southeast (CIES) ongoing. Socioeconom cropping system ic Impact Socioeconomic studies to deternmine project Will not be carried out Review impact on employment, income, migration of labor and the changes in production systems Marketing Study to improve marketing system, focusing Not carried out, with Bank's agreement Study on storage. Source: SAR, CNA and SARH 1993 - 33 - MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 6. PROJECT BENEFITS A. PROJECT IMPACT ON RAINFED CROP YIELDS (Tons/Ha) COASTAL AREAS DEPRESSION SAR TARGET ACTUAL SAR TARGET ACTUAL estimate estimate OUTPUT (W/O Project) Maize 1.5-2.0 3.0 3.0 2.1 4.0 4.0 Beans 0.6 1.2 1.2 0.8 1 2 0.8 Sorghum NA NA 4.7 NA NA 3.5 Rice NA 3.5 4.5 NA NA NA Cotton NA NA NA NA NA 2.3 Soybean NA 2.5 1.8 NA NA NA Sesame NA 1.2 0.7 NA NA 0.8 Groundnut NA 2.0 NA NA NA 1.7 Tobacco 1.0 1.8 1.6 NA NA NA Sugarcane NA NA 72.0 NA NA NA Bananas NA NA 34.7 NA NA NA Cocoa NA NA 0.7 NA NA NA Papaya NA NA 29.5 NA NA NA Mango NA NA 10.1 NA NA 8 Melons NA NA 7.2 NA NA 9.6 Watermelon NA 1.5 11.0 NA NA 13.4 Oranges NA NA 5 30 NA NA Tomatoes NA NA 9.52 NA NA 14.8 SOURCE: SAR, CNA 1993 and Table 6 B. MEXICo CHIAPAS AGRICULTURAL DEVELOPMENT (Loan 2526-HX) PROJECT COMPLETION REPORT TABLE 6: PROJECT BENEFITS B: LAND USE AND PRODUCTION RESULTS (a) Total Project Area CROP AREA ( '000 HAS)I I Yield PRODUCTIONS (TONS) I Price PRODUCTION VALUES (Mex$000) changes chanes _ 1985 1993 I change over 1985 1985 1993 I chiange over 1985 1985 1993 I change '1AIZE 53,905 54,845 2 40 111,553 159,319 43 -22 119,544 133,853 12 BEANS 2,303 6,377 177 -8 1,914 4,897 156 -5 4,526 10,959 142 SORGHUM 745 398 -47 33 2,161 1,534 -29 -58 2,481 736 -70 RICE 472 56 -88 101 1,058 252 -76 17 975 272 -72 COTTON 30 20 -33 23 56 46 -18 104 80 134 68 SOYBEANS 21,917 8,264 -62 -6 41,892 14,878 -64 -21 52,874 14,752 -72 SESAME 2,400 3,120 30 12 1,513 2,206 46 19 2,708 4,714 74 GROUNDNUTS 231 823 256 37 293 1,433 389 -15 701 2,915 316 TABACCO 1,654 1,962 19 3 2,647 3,236 22 143 8,993 26,699 197 W SUGARCANE 6,957 7,338 5 13 445,248 528,336 19 -59 86,456 41,558 -52 _ BANANAS 7,464 13,669 83 0.5 257,808 474,431 84 -14 200,239 315,764 58 COCOA 9,574 7,763 -19 -4 7,781 6,032 -22 -62 75,543 21,980 -71 PAPAYA 250 674 170 64 4,500 19,890 342 52 1,966 13,238 573 MANGO 2,645 11,511 335 34 20,021 116,347 481 -51 24,866 70,804 185 MELONS 1,288 842 -35 9 8,520 6,077 -29 41 5,916 5,960 1 WATERMELONS 2,573 1,406 -45 -13 32,807 15,651 -52 143 17,464 20,268 16 ORANGES 0 250 n.a. n.a. 0 1,250 n.a. n.a. 0 756 n.a. TOMATOES 0 740 n.a. n.a. 0 10,847 n.a. n.a. 0 5,637 n.a. TOTAL CROPS 114,408 120,058 5 39 939,772 1,366,722 45 -22 605,332 690,999 14 LIVESTOCK 18,455 26,116 42 88 21,197 56,366 166 -24 22,872 46,519 103 TOTAL 132,863 146,174 10 35 960,969 1,423,088 48 -21 628,204 737,518 17 Basic Grains 57,425 61,676 7 33 116,686 166,062 42 -20 127,526 145,820 14 Oil+Tobacco 26,232 14,189 -46 -13 46,401 21,799 -53 60 65,356 49,214 -25 Trad. Perenn. 23,995 28,770 20 18 710,837 1,008,799 42 -26 362,238 379,302 5 rruits/Veget. 6,756 15,423 128 13 65,848 170,062 158 -10 50,212 116,663 132 Sources: SAR, CNA, and SARH MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT (Loan 2526-MX) PROJECT COMPLETION REPORT TABLE 6: PROJECT BENEFITS B: LAND USE AND PRODUCTION RESULTS (b) Coastal Project Area CROP AREA ('000 HAS) W Yield PRODUCTIONS (TONS) I Price PRODUCTION VALUES (MexS000) changes changes 1985 1993 I change over 1985 1985 1993 * change over 1985 1985 1993 i change MAIZE 31,720 25,348 (20) 31 74,143 77,707 5 (5) 69,095 69,148 0 BEANS 341 23 (93) 62 256 28 (89) (34) 497 36 (93) SORGHUM 0 113 +100 0 0 536 +100 0 0 242 +100 RICE 472 56 (88) 101 1,058 252 (76) 17 975 272 (72) COTTON 0 0 - 0 0 0 - 0 0 0 - SOYBEANS 21,917 8,264 (62) (6) 41,892 14,818 (64) (21) 52,874 14,752 (72) SESAME 2,383 3,110 31 12 1,502 2,198 46 20 2,676 4,695 75 GROUNDNUTS 0 0 - 0 0 0 - 0 0 0 - TABACCO 1,654 1,962 19 3 2,647 3,236 22 143 8,993 26,699 197 W SUGARCANE 6,957 7,338 5 13 445,248 528,336 19 (59) 86,456 41,558 (52) BANANAS 7,464 13,669 83 0 257,808 474,431 84 (14) 200,239 315,764 58 COCOA 9,574 7,763 (19) (4) 7,781 6,032 (22) (62) 75,543 21,980 (71) PAPAYA 250 674 170 64 4,500 19,890 342 52 1,966 13,238 573 MANGO 2,599 11,326 336 33 19,837 114,867 479 (50) 24,074 69,501 189 MELONS 1,161 822 (29) 9 7,646 5,885 (23) 66 4,452 5,695 28 WATERMELONS 2,410 1,351 (44) (15) 31,330 14,916 (52) 167 15,204 19,298 27 ORANGES 0 250 n.a. n.a. 0 1,250 n.a. n.a. 0 756 n.a. TOMATOES 0 25 n.a. n.a. 0 238 n.a. n.a. 0 237 n.a. TOTAL CROPS 88,902 82,094 (8) 53 895,648 1,264,680 41 (21) 543,044 603,871 11 LIVESTOCK 2,276 1,862 (18) 77 5,326 7,704 45 (21) 4,963 5,673 14 TOTAL 91,178 83,956 (8) 53 900,974 1,272,384 41 (21) 548,007 609,544 11 Basic Grains 32,533 25,540 (21) 33 75,457 78,523 4 (5) 70,567 69,698 (1) Oil+Tobacco 25,954 13,336 (49) (14) 46,041 20,312 (56) 62 64,543 46,146 (29) Trad. Perenn. 23,995 28,770 20 18 710,837 1,008,799 42 (26) 362,238 379,302 5 Fruits/Veget. 6,420 14,448 125 10 63,313 157,046 148 (4) 45,696 108,725 138 Sources: SAR, CNA, and SARH HEXICO CHIAPAS AGRICULTURAL DEVELOPMENT (Loan 2526-MX) PROJECT COMPLETION REPORT TABLE 6: PROJECT BENEFITS B: LAND USE AND PRODUCTION RESULTS (c) Central Depresslon Project Ared CROP AREA ('000 HAS) t Yield PRODUCTIONS (TONS) t Price PRODUCTION VALUES (Mex5OOO) changes changes 1985 1993 I change over 1985 1985 1993 t change over 1985 1985 1993 t change MAIZE 22, 185 29,497 33 64 37,410 81,672 118 (41) 50,449 64,705 28 BEANS 1,962 6,354 224 (9) 1,658 4,869 194 (8) 4,029 10,923 171 SORGHUM 745 285 (62) 21 2,161 998 (54) (57) 2,481 494 (80) RICE 0 0 - 0 0 0 _ 0 0 0 - COTTON 30 20 (33) 23 56 46 (18) 104 80 134 68 SOYBEANS 0 0 - 0 0 0 - 0 0 0 - SESAME 17 10 (41) 24 11 8 (27) (18) 32 19 (41) GROUNDNUTS 231 823 256 37 293 1,433 389 (15) 701 2,915 316 TABACCO 0 0 - 0 0 0 - 0 0 0 - SUGARCANE 0 0 - 0 0 0 - 0 0 0 - BANANAS 0 0 - 0 0 0 - 0 0 0 - COCOA 0 0 - 0 0 0 - 0 0 0 - PAPAYA 0 0 - 0 0 0 - 0 0 0 - MANGO 46 185 302 100 184 1,480 704 (80) 792 1,303 65 MELONS 127 20 (84) 39 874 192 (78) (18) 1,464 265 (82) WATERMELONS 163 55 (66) 47 1,477 735 (50) (14) 2,260 970 (57) ORANGES 0 0 - 0 0 0 - 0 0 0 - TOMATOES 0 715 n.a. n.a. 0 10,609 n.a. n.a. 0 5,400 +100 TOTAL CROPS 25,506 37,964 49 55 44,124 102,042 131 (40) 62,288 87,128 40 LIVESTOCK 16,179 24,254 50 105 15,871 48,662 207 (26) 17,909 40,846 128 TOTAL 41,685 62,218 49 68 59,995 150,704 151 (36) 80,197 127,974 60 Basic Grains 24,892 36,136 45 46 41,229 87,539 112 (37) 56,959 76,122 34 Oll+Tobacco 278 853 207 35 360 1,487 313 (9) 813 3,068 277 Trad. Perenn. 0 0 0 0 0 0 0 0 0 0 0 Fruits/Veget. 336 975 190 77 2,535 13,016 413 (66) 4,516 7,938 76 Sources: SAR, CNA, and SARH - 37 - MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 6. PROJECT BENEFITS C. FINANCIAL AND ECONOMIC ANALYSIS NPVs per hectare 1984 and 1993!' FARM MODELS | SAR Estimates (1984) 1 PCR Estimates (1993W Coastal Ejido Crop (8 ha) 295 1,346 Coastal Ejido Mixed 92 450 Crop/Livestock (130 ha) Private Coastal Crop (20 37 580 ha) Central Depression Ejido 70 -35 Crop (7 ha) SOURCE: SAR, CNA 1993 1 / At 12 % discount rate. 2/ PCR Estimates are based on actual productivity changes, assurning all other variables remain as in the original farm models - 38 - MEXICO CIIIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 6. PROJECT BENEFITS D. AREA DEVELOPMENT SAR ESTIMATE (1984) l________ _________ GOM ACTUAL AS lefo Araf l l REVISED ACTUAL % OF AREA Area for r Deve lopment (1991) (1992) REVISED Tapachula 98,500 60,000 37,077 62 Huixtla 56,000 60,000 47,902 80 Acapetahua 63,000 60,000 57,161 95 Las Margaritas 37,500 60,000 10,725 18 Sub-Total 255,000 90,0002' 240,000 152,865 64 Coastal Area Comitan 32,000 32,000 32,000 19,000 59 Suchiapa 8,000 8,000 15,000 9,900 66 San Miguel 1I 8,000 8,000 13,000 10,120 78 Margenes de Canceled - Grijalva 7,000 7,000 _ _ _ Sub-Total 62,500 62,500 60,000 3/ 39,020 65 Central Depression Los Altos 7,500 7,500 Canceled | | Sub-Total j 7,500 | 7,500 Canceled - Central Plateau || I _ l l l TOTAL 317,500 | 152,500 | 300,0004/ | 191,885 | 64 SOURCE: SAR and CNA 1993. 1/ Included only river control dikes, roads and improved extension. 2/ 90,000 ha (out of the 255,000 ha) to be selected focusing on ejidos and smallholder farmers (not including Las Margaritas), to be fully developed with drains and on-farm works for intensive crop and livestock production. 3/ 48,000 ha in Part 11. 4! 288,000 ha in Part 11. - 39 - MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 6. PROJECT BENEFITS F. AREA DEVELOPMENT BY TYPE OF LAND USE (has) LAND USE SAR ESTIMATE (1984) | ACTUAL ACTUAL (1985) (1993) ACTUAL TARGET | COASTAL AREA Crops 81,000 117,000 88,902 82,094 Livestock 159,000 123,000 114,408 120,058 Other 15,0000 15,000 n/a n/a Sub-Total 255,0009 255,000 91,178 83,956 CENTRAL DEPRESSION AREA Crops 33,000 45,000 25,506 37,964 Livestock 15,500 10,000 16,179 24,254 Other 6,500 nil n/a n/a Sub-Total 55,000 55,500 41,685 62,218 Crops 3,750 7,500 2,276 1,862 Livestock nil 18,455 26,116 Others 3,750 nil na TOTAL 317,500 317,500 132,863 146,174 SOURCE: SAR, SARH and CNA 1993. 8. Included only river control dikes, roads and improved extension MEXICO CHIAPAS AGRICULTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COMPLETION REPORT TABLE 7. Status of Legal Covenants Cove- Original Revised nant Fulfiltment Fulfillent Agreement Section Type Status Date Date Description of Covenant Comments Loan No. 2.02 (b) F OK The Borrower shall, for purposes of the Project, Done 2526-ME open and thereafter maintain in dollars, a Special Account on terms and conditions satisfactory to the Bank. Deposits into and payments out of the Special Account shall be made in accordance with the provisions of ScheduLe 3 to this Agreement. 4.01 F OK 6/30/93 08/30/93 The Borrower shall: (i) have the Special Account, Done for each fiscal year audited in accordance with appropriate auditing principles consistently applied by independent qualified auditors; (ii) furnish to the Bank as soon as available, but in o any case not later than six months after the end of each year, a certified copy of the report of such audit by said auditors, of such scope and in such detail as the Bank shaLl have reasonably requested; (iii) furnish to the Bank monthly certified statements of the Special Account; and (iv) furnish to the Bank such other information concerning the Special Account and the audit thereof as the Bank shalt reasonably request. Guarantee 3.01 M OK The Guarantor declares its commitment to the In compliance objectives of the Project as set forth in ScheduLe 1 to the Loan Agreement. ("Due diligence covenant") Guarantee 3.02 (a) M OK The Guarantor shaLl: (i) enter into the Done contractual arrangements referred to in Section 3.01 of the Loan Agreement with the Borrower; and (i) not later than September 30, 1985, furnish to the Bank a certified copy of the coordinating agreement between the Guarantor and the State pursuant to articles 69 and 93 of the CUD. PEXICO CHIAPAS AGRICULTURAL DEVELOFNT PROJECT (Loan 2526-ME) PROJECT COWLET ION REPORT TABLE 7. Status of Legal Coveats (Cant.) Cove- Original Revised nant Fulfillment Fulfillment Agreement Section Type Status Date Date Description of Covenant Comments 3.04 (a) T OK Not Later than December 1, 1986 and every year Done thereafter, the Guarantor shall, through SARH (i) prepare and furnish to the Bank the execution program for the infrastructure works described in Part A of the Project to be carried out during the following calendar year; and (ii) exchange views with the Bank on such program.. 3.04 (b) T OK The Guarantor, through SARH, shall follow criteria No new areas are acceptable to the Bank in the programming of the programmed since areas within the State to be developed under the US$32 million were Project, such criteria to include, inter alia, canceled from the that (i) the area to be developed would benefit Loan. primarily small-scale farmers; and (ii) the area is technically and economically feasible for development of agricultural production. 3.04 (c) T RVS The Guarantor undertakes that production support Agriculture services, when required, are or will be available extension not in a timely manner for the areas programmed for provided development in accordance with paragraph (b) of adequately due to this section. SARH scaling down its extension services. 3.05 T SOON The Guarantor shall: (i) by December 31, 1987, Done, late in carry out a review of the construction and 1992; road and maintenance practices regarding rural roads in the drain maintenance State under the jurisdiction of SCT and SARH, with policy outline due a view to further rationalizing rural roads by April 30, 1994. designs, specifications, construction methods and Follow up in maintenance practices, and assessment of PRODERITH II maintenance responsibilities between agencies, and (ii) exchange views with the Bank on the conclusions and recommendations of such review. EXICO CHIAPAS AGRIaJLTURAL DEVELOPMENT PROJECT (Loan 2526-ME) PROJECT COtPLETION REPORT TABLE 7. Status of Legal Covernats (Cont.) Cove- Original Revised nant Fulfillment Fulfillment Agreement Section Type Status Date Date Description of Covenant Comments 3.06 T SOON (ii) The Guarantor shall (i) furnish to the Bank by (i) Done 05/31/94 July 31, 1988, the study included under Part E (d) (ii) An of the Project (state storage requirement); and envirownmental ecno review, on a periodic basis, the socio- audit of project economic and envirorunental impact of the Project, activities to be carried out before. Follow up in PROMERITH 11. 3.07 T OK Unless the Guarantor and the Bank shall otherwise User associations agree, the Guarantor shall recover upon completion for O&M are being of all infrastructure works included in each formed, some particular area within the Project, the costs of equipment has been operation and maintenance, as well as, to the procured and extent feasible, the investment cost of such transferred to works, user association. O&M experiment _ _ _ _ _ _ _ _ _ _ ___________________ _____________________________ u nderway . 4.01 (a) F OK The Guarantor shall maintain a cause to be Done (b) maintained adequate records and accounts of the (c) departments or agencies of the Guarantor responsible for carrying out the Project or any part thereof; and have the audit report submitted to the Bank not Later than six months at the end of the fiscaL year, inctluding a separate audit opinion on statements of expenditures. Key Covenant type: Status: E Economic ACT Needs use of formal remedies to bring about compliance F Financial NYD Not yet due M Managerial OK Covenant complied with T Technical RVS Needs to be revised SOON Compliance expected in reasonably short time - 43 - NXICO CHIAPAS AGRICULTURAL DEVELOPMIET PROJECT (Loan 2526-IE) PROJECT COMLETION REPORT TABLE 8. USE OF STAFF RESOJRCES TRS Managing Staff Staff Staff Staff FY Task Division Division Typo Number Last Namn Specialty TRS Month Weeks BANKIIFC - REGULAR BUDGET (BB) 82 LENP LA2NR LA2NR H DCF 12 .1 EGR 12 .0 * Subtotal LENP ,1 Total 32 .1I 83 LENP LA2NR LA2NR H AGR 12 .4 ECN ECONOMIST 12 .1 EGR 12 12.1 * Subtotal LENP 12.6 Total 83 12.6 84 LENA LA2NR LA2NR A ETA 12 2.0 OPA 12 1.6 C EGR 12 4.9 ENS 12 4.2 H AGR 12 8.2 ECN ECONOMIST 12 9.1 EGR 12 10.4 * Subtotal LENA 40.5 LENP LA2NR LA2NR C EGR 12 2.1 ENS 12 2.7 AGR 12 3.7 DCF 12 .7 EGR 12 3.3 LVS 12 .1 LEGLA H XXX 12 .1 * Subtotal LENP 17.6 Total 84 58.0 85 LENA LA2NR LA2NR A ETA 12 2.3 OPA 12 .2 H AGR 12 .3 ECN ECONOMIST 12 .5 EGR 12 3.3 * Subtotal LENA 6.5 LENN LA2NR LA2NR A ETA 12 .6 H AGR 12 .0 S5 LENN LA2NR LA2NR H ECN ECONOMIST 12 .6 EGR 12 4.2 - 44 - TRS Managing Staff Staff Staff Staff FY Task Division Division Type Number Last Name Specialty TRS Month Weeks * Subtotal LENN 3 SPN LA2NR LA2NR H EGR 12 .9 Total 85 12.8 86 SPN LA2NR LA2NR C AP5155 12 .6 H 03627 Downing 12 7.6 * Subtotal SPN 8.2 Total 86 8.2 87 SPN LA2NR LA2NR H 03627 Downing 12 .5 05883 WIson 12 .1 11057 Roel 12 2.9 12202 Bulletr 12 4.9 17094 Wittenberg 12 2.1 PRESV H 16427 Ochs 12 4.9 * Subtotal SPN 14 Total 87 14 88 SPN LA2NR LATAG H 03627 Downing 12 2.6 LATEN H 09421 Plaza 12 2.7 LA2NR H 07672 Von Pogrell 12 6.8 12202 Buller 12 3 12440 Binswanger 12 .6 - Subtotal SPN 18.0 Total 88 18.0 89 SPN LA2NR LATEN H 09421 Plaza 12 1 10370 Goodland 12 .1 17953 Davis 12 .0 LA2NR H 12 .0 07672 Von Pogrell 12 7.9 12202 BULLER 12 2.0 Subtotal SPN 11 Total 89 11 90 SPN LA2NR LATEN H 09421 Plaza 12 .0 LA2NR H 07672 Von Pogrell 12 5 * Subtotal SPN 5 Total 90 5 91 SPN LA2NR FAOS3 F 12 .0 LATEN H 09421 Plaza 12 .0 LA2NR H 12 .0 07672 Von Pogrell 12 7.1 21820 Margulis 12 1.8 * Subtotal SPN 8.9 Total 91 8.9 92 SPN LA2NR ENVLW H 02004 Villmran 12 1.2 LA2NR C 12 .0 H 07672 Von Pogrell 12 11.3 10976 Sallier 12 4.0 LA2MX H 01323 McCarthy 12 .4 Subtotal SPN 16.9 Total 92 16.9 - 45 - TRS Managing Staff Staff Staff Staff FY Task Division Division Type Number Last Name Specialty TRS Month Weeks 93 SPN LA2NR LA2NR C 12 .0 H 12 .0 10976 Sallier 12 6.8 12331 Cackler 12 .0 15348 Bronkhorst 12 7.2 20183 Mcintire 12 .0 * Subtotal SPN 14.0 Total 93 14.0 94 PCR LA2NR LA2NR H 10976 Sallier 1 .2 2 .9 4 .4 12 .0 11839 Shaw 3 .0 4 1.4 5 .5 7 .6 8 1.4 9 1.8 12 .3 15348 Bronkhorst 4 .6 5 .6 7 .4 8 ,2 12 .0 - Subtotal PCR 9.5 SPN LA2NR AGRNR H 16427 Ochs 12 .0 LATEN H 09421 Plaza 4 1.3 12 .0 LA2NR H 10976 Sallier 12 .0 11839 Shaw 12 .0 94 SPN LA2NR LA2NR H 12331 Cackler 12 .0 15348 Bronkhorst 1 .2 2 .2 3 .3 6 .2 12 .0 * Subtotal SPN 2.2 Total 94 11.7 TOTAL BB 197.2 TOTAL 6MXCPA085 197.2 * Subtotal PCR 4.7 IDTRSOI FOCEXEC - Rundate 07/15/94; Actual data as of 07/15/94. Type of Staff: H = Higher Level, C - Consultant, A - Assistant, L Local Staff, K = Local Cona., S = Special Pos., F = FAO. iBRD 18236 =.. A0, -' N .- 90 MAY 195A MEXICO CHIAPAS AGRICULTURAL I , , ; DEVELOPMENT PROJECT Proposed Chiaq2is Plan Bank F,,,onced Pro)ect Areas - __ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Other Protect Areas -- Roads Under Construction Rood Surface -Pa-ed Grovel _- ( I Stale Capit / V / QU0>. -\ - A | \ C Sele0cted Ct,es and Towns Rivers - V- Sta- o-o ores ,es AC / _ ~~~~~~~ ° ~~~~~>-< )>./ ~~~~~~~~~G U A T E M A t A 20 ,C orc I x C -U5 ; ) .0 20 t0 8o TPAC-A COT. ... _ * UNITED STATES OF AMERICA 0 LaGUNAS 0D CAPETA.LA aAS ARGORTITAr t ALLE DE COWTAN 6 SUCOIArA-SANTA DOM-NGO 7 AAGENES DEL anIJALnA 5 S NMIGUEL Ii 9 ALTOS SAN CRISTOBAL DE LAS CASASI v Cg , ; ' - A '.G CESCCS EGsO C-IMALA,A-CHtCArA - X ( _O MEXICO TEAPA-TAcOTALCA ; LAS MARGARITAS-RIO STO. DDUINGO \.-- O Cr.,GO SAN VicENT - CAnRONEnA E A. TUZANTAN ZONA ALTA,-~-- AfZ CINT.TL.AC* 54 Pr nr -~~~~~~~~~~~~~ I imi.ova~~~~~~~~~~97