Public Disclosure Authorized Impact Evaluatilon Report...

Report No. 3959 L COPY

Impact Evaluatilon ReportColombia: Atlantico Irrigation Project

June 21, 1982

Operations Evaluation Department

FOR OFFICIAL USE ONL'V

Document of the Wbrld Bank

This document has a restricted distribution and may be used by recipientsonly in the performance of their official duties. Its contents may not otherwisebe disclosed without World Bank authoi-ization.

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FOR OFFICIAL USE ONLY

IM_ACT EVALUATION REPORT

COLOMBIA: ATLANTICO IRRIGATION PROJECT(LOAN 502-CO)

TABLE OF CONTENTS

Page No.

Preface .................. ........................................ iSummary and Conclusions ....... ............ ......... ...... ... ... .. ii

I. INTRODUCTION ........................................ o .............. 1

A. Historical Background . ....... ... . . 0. . -. . . . . . . . .. . . . 1B. The Project ............. 3

II. MAIN DEVELOPMENTS SINCE PROJECT COMPLETION ............. 6

A. Drainage System ............. .............. ...... ...-.. 6B. Irrigation Scheme * . .. o..o.... .... ..... ...... ....... .. 7C. Connection with the Main Electric System ........... 7

III. SOCIAL IMPACT .................................. 8

A. Agrarian Reform. . ......... ....... .... ....... .... ... 8B. Failure of the Cooperative System ............... o. 9

IV. AGRICULTURAL IMPACI ... o.. .. ..... ... o ........ . ............ 12

Ao Cropped Area ooo .................................. 12B. Net Value of Agricultural and Livestock

Production .... * .......... o.o.o.o.o ..................o ... ... o 13

V. ECONOMIC IMPACT .. .. ........ .. ..... . o ..... .... o. 16

VI. IMPACT ON INSTITUTIONS . ...... ...... ......... . e...o. 17

VII. FUTURE PROSPECTS .. .. ..... .o..o ........ . ....... .o. . 18

VIII. CONCLUSIONS o.............o .oo..o..ooo ...... .o.....................o 19

Appendix 1: Borrower's Comments ..... e...*........................ 23

Annex 1:

Table 1 - Appraisal Cost Estimates . . ...................... ...... 312 - Size Distribution of Rural Property in

Southern Part of Atlantico Province in 1966 ..o.... 333 - Comparison of Estimated Costs and Actual

Expenditures o ...... o... ........................... o.oo* .oo.... 344 - Allocation of the Proceeds of the Loan ............. 36

This document has a restricted distribution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be disclosed without World Bank authorization.

TABLE OF CONTENTS (cont'd.)

Page No.

Annex 2:

Table 1 - Distribution of Farming Families in theProject Area (Phase I and II) ...................... 37

2 - Land Acquisition by INCORA .......................... 383 - Distribution by Year of Land Acquisition by INCORA .. 394 - Evolution of Cash Crops in the Settlement Area ...... 405 - Distribution of Land Use by District in Phase I

and II Areas (1980) ............................... 416 - Land Use by Settlers in Phase I and II Areas (1980) . 427 - Land Use by Private Farmers Under Rainfed Conditions. 438 - Key Indicators: Summary of Actual and Projected

Cultivated Area, Net Value of Production andNet Income Per Family *s .......................... 44

Maps: - IBRD - 10163R (Map 1)IBRD - 3245R2 (Map 2)

IMPACT EVALUATION REPORT


PREFACE

This is an Impact Evaluation of the Atlantico Irrigation Projectin Colombia, for which Loan 502-CO was approved in June 1967 in the sum ofUS$9.0 million and closed- eight and a half years later in December 1975 aftercancellation of US$0.3 million.

The Impact Evaluation Report is based on a review of the AppraisalReport (No. TO-589-b) dated June 13, 1967, the President's Report (No. P-552)of June 15, 1967, the Loan Agreement dated July 31, 1968, and the ProjectPerformance Audit Report (PPAR, OED Report No. 1841) of December 28, 1977;relevant Bank files have also been consulted, and Bank staff associated withthe project have been interviewed.

OED missions visited Colombia in April and October 1981. Farmsurveys and data gathering, which were carried out in August-September 1981 bythe Colombian Institute for Agrarian Reform (INCORA) and the Hydrology,Meteorology and Land Development Institute (HIMAT), yielded many valuableinsights regarding the social and economic impact of the project. OED mis-sions held discussions with officials of INCORA and HIMAT. A field trip tointerview a number of part:icipating farmers was undertaken. The informationobtained during these missions was used to test the validity of some conclu-sions of the 1977 audit report and permitted discussions of the project'simpact on the lives of the project's beneficiaries and on agricultural produc-tion.

A copy of the draft report was sent to the Borrower on March 16,1982. However, no comments were received.

This project was selected by OED for impact evaluation for thefollowing reasons: (i) it was the first Bank financed irrigation and landsettlement project in Colombia, (ii) its implementation time overrun wasabout 57%, mostly because of technical problems; and (iii) its economic andsocial impact was still uncertain at time of the audit.

The valuable assistance provided by INCORA and HIMAT and theirstaff, as well as the farmers interviewed during the preparation of this

report, is gratefully acknowledged.

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SUMMARY AND CONCLUSIONS

The Project

1. Loan 502-CO (US$9.0 million), approved in June 1967, was to financethe construction of irrigation and drainage systems on 3,300 ha of previouslyundeveloped land (Part I); flood protection and drainage on 6,000 ha ofrainfed land (Part II); cgrarian reform and land settlement on both parts;construction of roads and marketing facilities; purchase of agriculturalequipment; and the feasibility study for a Stage II project (Loan 849-CO,approved by the Bank in Juae 1972).

2. It took more than eight years to disburse the loan. Technicalproblems were the main factor slowing down project implementation: most of thesoils to be irrigated proved to be saline and/or alkaline. Procurementdifficulties in constructing pumping stations were another reason for delaysin implementation. The project envisaged developing fruit and vegetableproduction for export under a sophisticated fixed sprinkler irrigation system.However, the intensive cropping pattern could not be implemented due to thepoor quality of soils and had to be replaced by a traditional cropping pat-tern, with output for the internal market. The land reform program was onlypartly completed; land acquisition and redistribution to settlers were delayedby difficulties encountered in completing negotiations with landowners andinsufficient funding to purchase the land. Settlers were grouped in produc-tion cooperatives based on collectivized production and centrally plannedfarming operations, without: the right to farm individual plots.

3. At completion, it: was found that the net value of production at fulldevelopment would be only about 25% of that originally estimated and that fullagricultural development would not be reached before 1981. The project'soverall ERR was estimated at 2.2% compared with 11% for Part I and 25% forPart II estimated at appraisal.

4. The PPAR, issued in December 1977, concluded that (i) because ofimproper project preparation and appraisal and delays in project implemen-tation, the economic results of the project were unsatisfactory but that(ii) the project had a positive impact on family incomes and living standardsof project beneficiaries.

Project Impact

5. Since completion, the project was adversely affected by (i) the poorefficiency of the drainage system resulting in severe floods and (ii) by thefailure to complete the irrigation scheme and connect the pumping stationswith the main electric grid. However, land acquisition and redistributionwere completed in 1981. Land occupation by squatters, which started duringproject implementation, continued during the recent years.

6. In 1981, the social impact of the project turned out to be somewhatmixed but more favorable, on balance, than at project completion. As a resultof the land reform and land occupancy by squatters, the population of the area(Stage I and II) increased by 650%, and the average farm size decreased byabout 85% compared to the pre-project situation. The production cooperativesystem failed, and the main cooperative, which in the early 70s grouped about1,000 members, went bankrupt. In 1975, settlers were given an identifiableplot which they started to work individually. All settlers interviewed duringthe mission expressed their disappointment with the collectivist experienceand satisfaction to be settled finally on their own 'individual holdings.

7. The collapse of the cooperative system and allocation of individualplots to settlers, combined with the deficiencies of the irrigation anddrainage systems, led to fundamental changes in the distribution of cropsgrown in the project area. The area of cash crops was reduced by about 85%,while food crops and livestock production increased considerably. Marketingof products, supply of inputs and access to credit remain major constraints toagricultural development. The net value of production in 1981 was about thesame as in 1975 and only 48% of that projected at completion for 1980. Theproject ERR is now estimated at 1.7%.

8. Although most of the farmers can be considered subsistence farmers,their net family income is significantly higher today than in the pre-projectconditions but only slightly better than the minimum wage in agriculture.The satisfaction generally expressed by settlers reflects more a contentmentto be landowners for the first time rather than beneficiaries of higher livingstandards.

9. In conclusion it can be said that, in economic terms, the AtlanticoProject was a failure. Nevertheless, its social impact is important since anorderly agrarian reform program and an acceptable land tenure system have beenintroduced and living standards of about 22,000 people have been improved.The project's positive social impact remains precarious, however, because ofthe drainage system's deficiencies and the subsequent increased risk of floodsif no prompt remedial action is taken.

10. In addition to the main findings of the PPAR, the following pointswhich were not apparent at the time of audit may be of particular interest:

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- settlers, who were initially considered the poorest segment ofthe population, tturned out to be a privileged group compared toother farmers (parts. 3.02, 3.05 and 4.03);

- failure of the production cooperative severely dampened thecooperative spirit of settlers and demonstrated the risk of(i) Introducing systems modeled after those of other countriesand not adapted ito local socio-economic conditions and (ii)developing a set,tlement scheme which left little initiativeto settlers and was not based on a self-help concept (paras.3.06-3.10);

- the major flaw of the project was that no attempt was made tofundamentally change the project design or drop the irrigationcomponent when unfavorable soil conditions became apparent(paras. 5.02-5.03);

- the Bank requirement that consultants be responsible for projectmanagement proved ill-founded (paras. 6.01-6.03);

- data provided by consultants were not reviewed critically by theBank for accuracy, completeness and consistency (paras. 6.01 and8601) .



I. INTRODUCTION

A. Historical Background

1.01 In 1961, the Co:Lombian Government adopted a land reform policyto correct what it considered to be an inequitable land tenure situation.The 1960 census had shown that 765,000 small farms with an average size of1.7 ha held 55% of the land while 14,600 large estates with an average sizeof 750 ha owned 45% of the land, much of it under-utilized. The ColombianInstitute for Agrarian Reform (INCORA) was established in December 1961 notonly as a land reform organization but also as an important agency for agri-cultural development. Its main objectives were to: (i) redistribute largeland holdings; (ii) develop unused lands and those not being used to theirfullest potential; (iii) increase both agricultural productivity and totalagricultural production; (iv) improve security of land tenure for smallfarmers and make it easier for them to acquire land; (v) improve farmers'living standards by providing them with technical assistance, credit andvarious social services; and (vi) ensure better conservation and use ofnatural resources.

1.02 The Land Reform Law required INCORA to establish "family farm units"wherever possible in its la-nd settlement work. A "unit" was defined as thearea of land sufficient to provide a normal family with an income adequatefor its maintenance, for paying off debts incurred in acquiring or improvingthe land and purchasing equipment and for progressively improving housingand general living standards. It was accepted that the size of settlement/development units would vary in relation to the soil, climate, location,relief and type of crops to be produced; subdivisions of land smaller than3 ha were forbidden by law.

1.03 To allow INCORA to achieve its objectives the Land Reform Lawpermitted it to acquire fanrs larger than 100 ha in irrigation projects bycompulsory purchase at valuntion. INCORA, however, had no legal right toforce owners of farms smaller than 100 ha to sell their land, nor was itable to acquire by compulsory purchase all the land owned in holdings largerthan 100 ha, since under the law owners of such holdings can retain 100 hafor their own use.

1.04 As an agency for agricultural development, INCORA was to operate asupervised credit program in association with the Caja Agraria. The programaimed at providing annual production loans as well as medium- and long-termloans to farmers. INCORA was to find the funds, decide on credit allocationand supervise its use. The Caja Agraria handled the financial transactions,kept records and took care of repayment collection.

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1.05 In the INCORA project areas, all private farmers had to conform toINCORA's irrigation and cropping programs. The Land Reform Law permitted

INCORA to enforce its rules by applying sanctions to farmers who did notcooperate. INCORA could exercise its legal right to withhold water deliveries

from them and could exclude them from its programs of technical assistance and

credit. INCORA was to recover costs of the irrigation investment throughwater charges. Private owners who decided to remain in the project area were

also forced to adopt the official cropping plan and follow agricultural

practices established for the project.

1.06 INCORA commenced its work by granting land titles to occupants

of existing holdings and later began to redistribute lands. These operations

were soon followed by agricultural development programs. At the end of1965, INCORA implemented irrigation and agricultural development projects in

an area of about 200,000 ha, and a further 140,000 ha was under investigation(map 1). In 1965 INCORA requested a Bank loan to finance its settlement and

development program in the Department of Atlantico in northern Colombia, where

the Guajaro Reservoir was under construction and was expected to providewater to irrigate about 35,500 ha.

1.07 The proposed project was located in the southeast of the Department

of Atlantico, bordered by the Magdalena River to the east and by the Canal delDique to the southwest (see map 2). The climate of the region is tropical and

semi-arid with an average annual rainfall of 1,000 mm but with irregular dis-tribution throughout the season. The project area is an undulating plain,divided into a series of low ridges by a number of small lakes or swamps.

First project investigations indicated that most land was under natural forest

or pastures, carrying beef and dairy cattle under extensive systems of manage-ment. The area was considered one of the most economically depressed in

the country due to the decreasing productivity of the fishing industry, whichfor several decades had been the primary source of income to the local popula-

tion. A limited amount of subsistence farming was practiced in the area, but

crops were subject to damage by annual flooding from the Rio Magdalena andlocal runoffs and the usually unfavorable rainfall distribution.

1.08 As initially conceived, the Atlantico Project envisaged agriculturaland rural development in an area covering about 66,000 ha in which three

sectors to be developed separately had been identified: the Repelon Sector(4,700 ha) to the west, which was to be developed by INCORA with its own

resources; the Molinero Sector (11,700 ha) to the north, being developed byprivate interests, and the South Sector (35,000 ha) to be developed with the

Bank's assistance (see maps). A feasibility study on agricultural developmentof the South Sector had been carried out by consultants, covering also aspects

of irrigation, drainage and flood control. A preliminary soil survey had also

been carried out by a local firm.

1.09 A Bank mission visited the project in June 1966. Its main preoc-

cupation was to evaluate the managerial capacity of INCORA to undertake a

35,000 ha project and the suitability of some soils for irrigation. Themission proposed, and the Government accepted, to reduce the risk by phasing

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the project in two stages. The project under Loan 502-CO, appraised inSeptember 1966, was designated as Stage I, including irrigation and drainageof 3,300 ha and flood protection and drainage of 6,000 ha to be farmed underrainfed conditions. Loan 849-CO, appraised in October 1970, was designated asStage II for drainage and land preparation on 17,000 ha for rainfed farming.

B. The Project

Project Description

1.10 As approved by the Board, the project which is the subject of thisImpact Evaluation Study included two parts. Part I entailed the constructionof a complete sprinkler irrigation system and drainage network and on-farmdevelopment needed for intensive cropping, mostly fruit and vegetables forexport, on about 3,300 ha; purchasing agricultural equipment; setting upmarketing facilities including an orange packing plant; establishing trialfarms; providing agricultural management including technical assistance tofarmers accompanied by credit facilities; acquiring most of the land andestablishing settlers; preparing feasibility studies for future stages of theproject and training personnel abroad. Part II included construction of aninterceptor channel to protect an area of 6,000 ha of cultivable land fromflooding, access roads and the introduction of improved cropping practices fortraditional rainfed agriculture. The project cost (Annex 1, Table 1) wasestimated at US$15.4 million (US$53 million in 1981 terms) and the Bank loan(US$9.0 million or US$31 million in 1981 terms) was expected to be disbursedover a five-year period.

1.11 At the time of appraisal, all land of the Atlantico South Sector(35,000 ha) was in the hands of about 850 owners (Annex 1, Table 2); approx-imately 4% was in holdings of less than 10 ha, 39% in holdings of 10 to 100 haand 57% in holdings larger than 100 ha. INCORA was expected to complete theacquisition of farms larger than 100 ha before the end of 1967 and to selectsettlers from the local farmers according to their "farming and businessability, physical fitness, willingness to work, adaptability, intelligence,discipline and mechanical knowledge".-' The land acquired by INCORA wasto be divided into family farm units of about 3 ha in Part I and 5 ha inPart II. Project management was to direct settlers as to the types of cropsto be grown and cultivation practices to be applied and would provide techni-cal assistance, machinery services, supervised credit and marketing services.

1.12 INCORA was to employ a qualified consulting firm which would beresponsible for engineering, agricultural development, management and market-ing during the construction period of the project and for at least five yearsthereafter. As the projeci: became well established and INCORA gained experi-ence, its own staff would. progressively take over full responsibility forproject management.

1/ Appraisal Report, para.. 4.18.

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1.13 At full development, family incomes were expected to increase 1200%for Part I and 400% for Part II beneficiaries. Based on the assumption thatabout 75% of the fruit, vegetable and tobacco production would be exported,investments in Part I of the project were expected to yield an ERR of 11%while double cropping of traditional crops in Part II would generate an ERRof 25%.

Project Implementation

1.14 The loan was declared effective on November 2, 1969 when a contractwith a foreign consulting firm was signed. Project start-up was rapid andeffective. However, reconnaissance soil surveys and groundwater testingover 8,000 ha in the South Sector by the consulting firm established that(i) salinity and alkalinity could be found to varying degrees throughout theStage I and Stage II areas, (ii) groundwater was also saline and (iii) aboutabout 1,250 ha (Block II) in Part I area (see map) were unsuitable for fieldcrop cultivation. An area in the eastern part of Part I (Block III) wasselected to replace Block II, but the total irrigable area was reduced from3,300 ha to 2,100 ha. Because of delays in replanning the project, theirrigation and drainage works were not completed in Block I until in 1971, ortwo years behind schedule, while irrigation works in Block III were severelydelayed and were not complete at project closing in June 1976. Other seriousdelays in project implementation were due to technical and procurement diffi-culties in constructing the San Pedrito pumping station, which was to supplyirrigation water for Part I. Construction of San Pedrito was finally com-pleted in April 1977, five years behind schedule and two years after theClosing Date. At project completion a large part of the area to be irrigatedstill remained to be cleared, leveled and prepared for cultivation.

1.15 During the eight implementation years, there were several changesin the original plan: (a) Loan 502-CO funds were used to provide floodprotection for both Stage I and II areas and not only for the 6,000 ha dry-farming area as originally planned; (b) several roads were constructed underLoan 502-CO in the Stage II area; (c) the Boquitas drainage pumping plant andthe main canal in the Stage II area were constructed to a capacity sufficientto accommodate all the estimated drainage for both Stage I and II areas; (d)because of the unsuitable soils, the plan to produce high value export cropshad to be abandoned and was replaced by a traditional annual crops program;consequently there was no need to construct facilities for storage, grading,packing and processing of export crop products; (e) the Manati ExperimentalFarm and the electric interconnection of pumping stations with the mainregional grid were not financed under Loan 502-CO, but incorporated under Loan849-CO; and (f) the purchase of operation and maintenance equipment forboth Stage I and II was made under Loan 502-CO. Total project expenditures(Annex 1, Table 3) exceeded the originally estimated cost by about 9%. Thisrelatively low increase in total cost over a period of eight years may beexplained by the fact that the major works were completed or contracted in1973, before the period of high inflation began, and that changes in projectcomponents eliminated or reduced the cost of certain items. The original

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allocation of loan proceeds was amended twice (Annex 1, Table 4) duringthe course of project implementation to conform more closely with actualexpenditures.

1.16 INCORA's land reform program was to acquire and redistribute tosettlers about 14,000 ha out of the 22,000 ha cultivable (and 26,300 ha totalarea) in Stages I and II. However, the program encountered delays in complet-ing negotiations with many landowners, and insufficient funds were provided byGovernment to purchase the land. At project completion, INCORA had acquiredabout 8,000 ha and settled about 840 families in both Stage I and II comparedto the 2,000 originally projected. Settlers were grouped into productioncooperatives, the most important of which was "Cooperativa Agropecuaria delCaribe, Ltda." supervised by INCORA and its consultants. Smaller livestockcooperatives were also established. For the Stage I project area alone (9,300ha) about 5,500 ha were acquired and redistributed to about 600 new settlers,while the remaining 3,800 ha were retained by their 310 original owners. Theland reform program continled under Loan 849-CO, both in Stage I and II areas.

1.17 The loan was closed on December 31, 1975, three years later thanoriginally planned. At coimpletion it was found that the net value of produc-tion at full development would be only about 25% of that originally estimatedmostly because of shifting from high value export crops to traditional crops.In Part I (3,300 ha) of Staige I, out of 2,150 ha of irrigable land only 900 ha(650 ha crops--mostly maize, sesame, cotton and sorghum--and 250 ha pasture)were irrigated, while the balance was used for rainfed crops and naturalpasture. In Part II (6,000 ha) crops covered about 2,200 ha and naturalpasture about 3,800 ha. It was estimated that full agricultural developmentand production would not be reached before 1981 because of delays in complet-ing the San Pedrito pumping station, as well as land preparation and drainageworks. The project's overall ERR was estimated at 2.2% compared with 11% forPart I and 25% for Part II calculated at appraisal. Increases in per capitaincome of settlers were about 4.6 times above pre-project incomes in Part Iand 1.9 times in Part II, compared with 12 and 4 times respectively projectedat appraisal.

Main Findings of the PPAR

1.18 The PPAR, issued in December 1977 (OED Report No. 1841) concludedthat, because of improper review of soil studies at appraisal and the slowpace of project implementation, the economic results of the project wereunsatisfactory. The PPAR pointed out that (i) the project design was overlyoptimistic and did not properly take into account the regional constraints,and (ii) the rate of return computation was not given enough attention sincedry-farming development was shown in the Appraisal Report to yield higher ERRthan irrigation. The project, however, had a positive impact on familyincomes and living standards; of project beneficiaries and made a satisfactorycontribution to institution-building.

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II. MAIN DEVELOPMENTS SINCE PROJECT COMPLETION

2.01 The Stage II Project (Loan 849-CO) was approved by the Bank inJune 1972, three and a half years before the closing of Stage I, and the twoprojects soon became interdependent. Part of the Stage I components (mainlyflood protection works and roads) benefitted landowners in both areas. Simi-larly part of the Stage II project works (land preparation, enlargement ofoperating headquarters, drainage works and equipment) also benefitted bothproject areas. Since 1975, INCORA has not distinguished between Part II ofStage I and Stage II, and separate figures indicating agricultural developmentunder rainfed conditions are not available for the two stages. Therefore,the impact of Stage I must be evaluated in conjunction with Stage II sinceboth pro ects aimed at improving the economy of the overall Atlantico SouthSector.1

2.02 Since the completion of the Stage I project at the end of 1975,three important factors have had a negative effect on the development of theAtlantico South Sector: (i) deficiencies of the drainage system; (ii) thecontinuing failure to complete the irrigation scheme; and (iii) delays inconnecting with the main electric network, resulting in adverse effects forboth the drainage and irrigation systems.

A. Drainage System

2.03 The project area is a depression, enclosed on the north by hills andon the other three sides by bodies of water which are at elevations abovethose of the fields. Thus, any internal drainage water has to be elevated bypumps before being discharged. The drainage system, which was started underStage I and completed in 1979 under Stage II, consists of 37 lateral canalsand 6 main canals which discharge into a main collector and thence to theBoquitas pumping station, where the water is raised into the Canal del Dique(see map). In 1981, the drainage system was found to be performing poorly forthe three following reasons:

(a) Although originally constructed to discharge water from both StageI and II, the design and capacity of the Boquitas pumping stationproved inadequate during the rainy season (October-November); in1971, a consultant's report recommended that the discharge capacitybe increased from 5 to 10 or more m3/sec when drainage works wereimplemented in the Stage II area, but the recommendation was nottaken into consideration by INCORA and the Bank; in addition, recent

1/ As Loan 849-CO (Stage II) was not yet closed at the time of this ImpactEvaluation, the economic rate of return was calculated for Loan 502-CO(Stage I) in order to compare the project economic viability both atcompletion (1975) and at impact evaluation time (1981) (see paras.5.01-5.03).

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inspection of the Boquitas station found that, because of wearof pumps, discharge capacity is now reduced to about 3.5 m3/sec;finally, during the rainy season, the level of water in the Canaldel Dique is above the Boquitas station outlet, thus hampering waterdischarge from the main collector.

(b) Because of poor maintenance and lack of equipment, most of themain and lateral canals are silted up and do not function properly.

(c) The Boquitas swamp, which was originally planned to serve as aretention reservoir for peak floods, has now been taken over bysquatters and therefore cannot be used for this purpose.

2.04 As a result of the inefficient drainage system, severe floodsadversely affect every year an area of about 2,000 to 2,500 ha of cultivatedland, mainly in the Manati sector (see map), where main canals converge andmerge into the main collector. Flooding of various degrees and duration aswell as a rise of the groundwater table cause destruction of crops or seriousyield reductions in a large number of other sectors in both Stage I and StageII areas. HIMAT commissioned a study to a consulting firm to investigate theshortcomings and to recommend possible remedies of the existing drainage sys-tem. The conclusions of the study are expected to be known by May-June 1982.

B. Irrigation Scheme

2.05 Irrigation started on about 1,000 ha in Block I in 1972 with tempo-rary pumps. In 1977 the San Pedrito station and five sub-stations locatedalong the main irrigation canal were completed, and the temporary pumps wereremoved. However, due to a lack of funding, irrigation works were not com-pleted by 1981: one pumping sub-station in Block I as well as all pumpingstations and secondary and tertiary canals in Block III remain to be con-structed. As a result, out of 2,100 ha of irrigable land, only 940 ha canactually be irrigated.

C. Connection with the main electric system

2.06 The San Pedrito pumping station, the 5 irrigation substations andthe Boquitas drainage pumping station were to be temporarily operated by adiesel-electric 2,600 kVa generating plant located close to the San Pedritostation. Loan 849-CO provided for a link-up with the main electric system.However, although a power line was constructed it was still not connected inNovember 1981. The whole pumping system has been, and still is, expensive tooperate and hampered by inadequate supplies of diesel fuel and lack of spareparts for the generator. Consequently, both the irrigation and the drainagesystems have remained unreliable so far.

III. SOCIAL IMPACT

A. Agrarian Reform

3.01 Redistribution of land was one of the main project objectives.INCORA started acquisition of land in 1965 and virtually completed redistribu-tion in 1981 in the Stage I and Stage II areas. In 1981, land distribution tosettlers (Annex 2, Table 1) reached about 13,400 ha, of which about 6,700 ha(50%) were acquired from 93 landowners, 2,700 ha (20%) were expropriated from11 landowners and the remaining 4,000 ha (30%) were recovered from unoccupiedland and drained swamps (cienagas). Evolution of land acquisition and redis-tribution in the two project areas (Annex 2, Tables 2 and 3) shows that:(i) about 57% of the land was redistributed during the Stage I (Loan 502-CO)project and the remaining 43% during Stage II (Loan 849-CO); (ii) at the endof 1981, 1,252 farming families were settled in Stage I and Stage II areas,compared with 840 at completion of Loan 502-CO (1975) and 2,000 originallyplanned; (iii) about 250 settlers (20%) have abandoned their holdings but havebeen subsequently replaced by others; and (iv) the average farm size is about11 ha per settler family.

3.02 The large majority of settlers are former fishermen, laborers ofprevious landowners or ex-sharecroppers. During the impact evaluation mission(October-November 1981) all settlers interviewed indicated that they arebetter off now than before the project and expressed their satisfaction withbeing landowners despite shortcomings in the project design and implementa-tion. Records show that repayments of land costs are about 30% in arrears.Since the amount of the original debt has not changed despite inflation,repayments have gradually become less and less of a burden. (Land was sold at1,000 to 2,300 pesos/ha while its value today is about 60,000 pesos/ha.)About 80 settlers have repaid their outstanding debts in advance to be able tosell their land or part of it.

3.03 In addition to settlers, about 2,400 farming families own about5,900 ha in Stage I and Stage II areas, on average 2.50 ha per family (Annex2, Table 1). These farmers are either former owners whose land was onlypartly expropriated, or not expropriated at all because of the small size oftheir holdings, or squatters who settled mainly in the drained swamps. A fewowners of the first group elected to retain part of their land (to the limitof 50 ha irrigable and 100 ha rainfed land) in accordance with the provisionsof the Agrarian Reform Law. Land occupation by squatters started duringproject implementation and has never been prevented nor legalized by INCORA.Squatters are mostly very small farmers (1 or 2 ha per family) who cultivateswamps or land considered unsuitable for distribution to settlers. As aresult, squatters are generally more affected by floods and soil salinityand constitute the poorest group of the project area population.

3.04 In conclusion, the agrarian reform program of the project was imple-mented in a completely different way from what was anticipated at appraisal.As originally planned, about 4,800 family farm units of 5 ha each in rainfed

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and 3 ha under irrigated conditions were to be established in both Stage I andII project areas. Such a land distribution was based on the assumption thatthe quality of soil as well as irrigation and drainage works would permitcultivation of high value crops for export in irrigated land and doublecropping of traditional crops under rainfed conditions. When salinity andalkalinity problems were discovered, the settlement targets were reduced toabout 2,000 families and an average of about 10 ha cultivable land per family.In 1981, overall land occupation actually covered about 19,300 ha dividedbetween 3,651 farming families, i.e. an average farm size of 5.25 ha perfamily, well below the project re-estimate. These figures have to be comparedwith the pre-project sit:uation where the same area of about 20,000 ha wasdistributed between about 560 landowners, with an average of 35.70 ha perfamily and with 57% of the land in holdings of more than 100 ha. As a resultof the land reform and subsequent squatter immigration, the population of thearea increased by 650% while the average farm size decreased by about 85%during the 15-year period.

3.05 Settlers who were to benefit from the agrarian reform policy wereinitially considered the poorest segment of the population. However, itturned out that settlers, and former small landowners, who because of thesmall size of their holdings escaped the agrarian reform law, are today aprivileged group compared with squatters. It can be said that the Govern-ment's first objective tc redistribute large land holdings was fully achievedin the Atlantico South Sector but that a new group of underprivileged hasemerged, i.e. the squatters. The other objective to prevent excessive sub-division of land was not achieved since the family farm unit of a large numberof smallholders remains below the 3 ha minimum limit permitted by the AgrarianReform Law. As in a number of other Bank settlement projects appraised in the1960s, the Atlantico Project illustrates that: (i) the settlement objectiveswhich at that time were considered reformist and conceptually advanced nowappear conservative and somewhat outdated and (ii) prevention of illegal popu-lation in-flow and enforcement of minimum land occupancy laws are extremelydifficult unless preventive measures are planned and taken in time.

B. Failure of the Cooperative System

3.06 The most imporl:ant development of the project in recent years hasbeen the collapse of the cooperative system in 1975 and the ensuing disinteg-ration of the Cooperativa. Agropecuaria del Caribe (CAC) which was establishedin 1965 under Project Management. The basic principles of CAC were thefollowing: (i) compulsory membership for all settlers farming in the projectareal/, (ii) collectivized production without individual plots and (iii)centrally planned farming operations. This production cooperative concept wasbased on the perception that new settlers, who previously were mostly fisher-men or laborers with a low degree of literacy, would lack basic knowledge and

1/ Stockbreeders were grouped into separate smaller livestock cooperatives.

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skill to develop their land adequately and adapt to improved cropping tech-niques. Although the objective of producing high value crops was abandonedsoon after project start-up, the Project Management thought that settlerswould be unable to adopt a modern cropping system for traditional crops unlessproduction was collectivized and strong technical assistance provided tocooperatives.

3.07 The CAC's operating rules and farmers' obligations were the follow-ing:

(a) determination of land use was the sole responsibility of ProjectManagement;

(b) the project area was sub-divided into large blocks of 100 ha ormore, in which only one crop would be grown;

(c) at the beginning of each cropping season, farmers had to decide onwhich crop they preferred to support. When shifting from one cropto another in following years, farmers were unable to identifythemselves with their "own" land, since the new crop was farmed in adifferent block.

(d) farming was mechanized using collectively owned agriculturalequipment;

(e) agricultural credit was granted only to the cooperative, but creditrisk had to be carried by each member proportionately to hisselected crop and land size; and

(f) shares in the profits were proportionate to the number of hours

worked and land rights.

CAC started its operation in 1966, when only small areas of land were redis-tributed, and expanded its operating area proportionally as land redistribu-tion to settlers progressed. It reached a peak of about 7,000 ha cultivatedland in 1970. The main crops produced by CAC were cotton, maize, sorghum,groundnuts, tomatoes and peppers.

3.08 The cooperative system, however, proved to carry the seeds of itsown destruction, and signs of deterioration appeared soon after CAC start-up.First, for a number of crops there had been no previous experience in theproject area, which soon became more than anything a risky experimentalcenter; yields and profits proved low for some crops, and other crops werequickly abandoned because of technical failures or marketing difficulties.Second, CAC was unable to face up to rapid increases in input and equipmentrequirements, particularly harvesting equipment, resulting in further depres-sing already poor yields. Third, although settlers were represented -on theCAC Board by elected members, the latter were unable to influence decisionsmade by Project Management; the system of annual plot selection also meant

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that settlers were not associated with a permanent plot but were given culti-vation rights in some part of a large cropping block, the location of whichchanged from year to year. Finally, possibilities for their labor input, andthereby increased earnings, were poor since most of the tasks were mechanizedand undertaken by CAC wordkers; the accounting system was poorly designed andkept up, and consequently farmers were not properly informed on their profitor indebtedness situation at the end of the cropping year. As a result ofthese shortcomings, settLers regarded themselves more as CAC employees thansmallholders, yet they were expected to continue bearing the risks for agri-cultural credit granted to them by the Caja Agraria through the cooperative.

3.09 CAC was able to pursue its operations as long as credit, which wasplentiful at that time, was granted regardless of profits or losses. In 1974,however, losses of CAC as a whole, and of its members in particular, were suchthat agricultural credit was suspended, thus triggering the collapse of CACand, by the same token, of most of the livestock cooperatives. In 1975settlers were finally given identifiable plots which they started workingindividually, and many who previously were living in villages started con-structing their houses on their own land. All settlers interviewed duringthe Impact Evaluation Mission expressed their bitterness and disillusionmentabout this unfortunate collective experience and their satisfaction to besettled on individual plots. However, since liquidation of CAC was notcompleted by 1981, a number of previous CAC members are still today noteligible for agricultural, credit because of the debts they contracted and didnot reimburse to the Caja Agraria during the CAC experience.

3.10 As in several projects in a number of countries during the 1960-70period, failure of the p:roduction cooperative system demonstrates the risk of(i) introducing systems modeled on those of other countries and not adapted tolocal, national, social, and traditional conditionsl/ and (ii) developing asettlement scheme which left little initiative to settlers and was not basedon a self-help concept.2/ The failure of CAC was the main reason why about250 settler families had to leave the project area and opted to emigrate toVenezuela as permanent cr casual laborers. Another negative effect of thisunfortunate experience has been and still is an extreme resistance by thefarmers towards any kind of association or cooperation. Although the remote-ness of the project area would normally lead to close cooperation betweenfarmers for the purchase of inputs and marketing of products, this is notdone, and strong individualism prevails. By going too far and too fast, thecooperative system established under the project not only failed but alsodestroyed any cooperatLve spirit among project beneficiaries. With the

1/ See PPAM of Senegal - Second Agricultural Credit Project (OED ReportNo. 3514), dated June 25, 1981.

2/ PPAM of Mauritius - Tea Development Authority Project (OED Report No.3761), dated January 13, 1982.

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benefit of hindsight, it can be said that a better approach would have been tosettle beneficiaries on individual plots first and then to help them toorganize service cooperatives for input supply, marketing and agriculturalequipment and other supporting services which are nonexistent in the projectarea today.

3.11 The failure of CAC also had a long-term adverse effect on relationsbetween INCORA and project beneficiaries. Although INCORA's consultantswere responsible for project management in general, and CAC management inparticular, in accordance with the terms of the Loan Agreement (see para.1.12) INCORA had to take the blame for the failure of the cooperative systemwhen the consultants left and INCORA took over full project responsibilitiesin 1975. It is worthwhile to note that INCORA managed over time to progres-sively and successfully regain farmers' confidence through modest but effici-ent agricultural extension and training programs, benefitting both men andwomen in the project area, and through functional literacy programs forchildren (para. 6.02). During its field visit, the Impact Evaluation Missionfound that the technical and social assistance of INCORA's officials is highlyappreciated by farmers.

IV. AGRICULTURAL IMPACT

A. Cropped Area

4.01 The collapse of CAC and allocation of individual plots to settlerstriggered a fundamental change in the project area's cropping system. Thecash crop area, which reached a peak of 7,000 ha in 1970 and still coveredabout 5,000 ha in 1974, fell to about 1,000 ha in 1976 and has remainedapproximately constant since (Annex 2, Table 4). Most of the settlers are nowconvinced that poor soil quality, unresolved drainage problems, unreliableirrigation water availability and marketing and input supply difficulties makecultivation of cash crops particularly risky and therefore have shifted towhat they consider safer food crops and livestock production. Although somecash crops (peppers or tomatoes for processing) are still considered moreprofitable than livestock and food crops, only a limited number of settlersare taking the risk to venture into these crops, the majority preferring lowerbut more secure incomes.

4.02 A census carried out in 1981 (Annex 2, Table 5) shows that: (i) ofthe 940 ha irrigable in Part I, only about 460 ha (49%) were cultivated andirrigated while the remaining 480 ha (51%) were used for pastures only partlyirrigated or not irrigated at all. In the rainfed sector (about 18,400 ha inboth Stage I and Stage II for which data are available), about 5,400 ha (30%)were cultivated (with cash crops and food crops accounting for 15% and 85%respectively of the total cropped area), and (ii) the remaining 13,000 ha wereused for pasture, of which about 45% were improved, the rest natural orundeveloped land.

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4.03 Different cropping patterns are used by settlers and the remainingprivate farmers according to farm sizes and past experience in the projectarea. As stated above (para. 3.05), the size of settlers' farms is generallyabove average, and settlErs' past experience in cash crops has been particu-larly disastrous for those who were grouped into CAC. Therefore, settlersshifted more deliberately than other farmers to livestock production, and usedto limit their cultivated area to about 1 ha per family, growing mainly foodcrops like maize, beans, cassava and bananas (details in Annex 2, Table 6).The relatively large size of their farms also permitted them to borrow moremoney for building up their herds and to own a sufficient number of cattle tomake a living. Although livestock production remains generally traditionaland extensive (about 1 head per ha on average), some settlers succeeded inintensifying their production with improved cattle and pastures (allowing forup to 6 head per ha) and by developing milk and cheese production. On theother hand, small farmers and squatters are not able to derive sufficientincomes from raising cattle on the small 2.5 ha average plots and are there-fore compelled to use their land for both food and cash crops. For "private"farmers (Annex 2, Table 7), crops account for 37% of the land used underrainfed conditions while for settlers, only 26%. Since a large proportion ofthe small private farmers is concentrated in the Manati region, which is moreseverely affected by floods, incomes of these small farmers remain low anduncertain. Finally, a Eew of the former landowners, who escaped agrarianreform to a certain degree and who are generally experienced farmers, are suc-cessfully maintaining a mixed system of cash crops and livestock production.

4.04 In addition to the low agricultural potential of the project areaand the shortcomings of the irrigation and drainage systems, a number of otherconstraints hamper agricultural development. The remoteness of the projectarea (about 100 km from Barranquilla) means that marketing of products, supplyof inputs and access to credit facilities are difficult, contributing tohigh production costs. Transport is also hampered by floods and poor roadmaintenance. Only strong and efficient service cooperatives could helpto break these bottlenecks, but as stated above (para. 3.10) the cooperativespirit no longer exists. Following the bankruptcy of CAC and the widespreadfailure of CAC members to repay their debts, about 50% of settlers have noaccess to credit. In addition, the project is also adversely affected bysome nationwide agricultural sector problems such as (i) a steeper rise incosts of inputs than in farmgate prices in 1980-1981 and (ii) an increase inrural wages consistently higher in recent years than the increase of agricul-tural product prices.

B. Net Value of Agriculrural and Livestock Production

4.05 Although it was difficult to disaggregate crop and livestock produc-tion and the net value of" Stage I from Stage II in 1975 (no separate statis-tics existed for the rainfed part of the two projects), the PPAR made anattempt to separately ca:lculate the incremental output of Stage I (9,300 haout of a total of 18,400 ha cultivated land) including Part I (irrigationsector) and Part II (rainfed sector). In order to compare the net value of

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production in 1981 with that prevailing in 1975, the calculation of crop and

livestock production was based on (i) the estimated Stage I area under cropsand used for livestock production in 1981 and (ii) the production value and

costs per hectare as established by INCORA and reviewed by the Impact Evalua-tion Mission.

4.06 In 1975, actual and projected cultivated area and value of produc-

tion (Annex 2, Table 8) showed that:

(a) for Part I (3,300 ha), the irrigated area was limited to 650 habut was expected to increase up to 4,400 ha in 1980 through comple-tion of irrigation works and introduction of a double croppingsystem allowing for a 146% cropping intensity;

(b) for Part II (6,000 ha), field crops, which then covered about2,200 ha (compared with 3,400 ha in 1972) were expected to reach3,000 ha in 1980, mostly through double cropping, while pastureswere expected to increase from 3,800 to 4,000 ha; cropping intensitywas to reach 116% at full development; and

(c) the actual net value of production was estimated at US$1.01 million(in 1980 terms) in 1975 (compared with US$0.7 million in 1972) andwas expected to reach US$2.20 million in 1980.

4.07 In 1981, the actual cultivated area and value of production(Annex 2, Table 8) were found to be as follows:

(a) in Part I, about 460 ha were under irrigated crops, 480 ha underpartly irrigated pasture and the remaining 2,360 ha were naturalpasture and not irrigated;

(b) in Part II, about 1,800 ha (a decrease of about 20% and 36% comparedwith 1975 and 1972 respectively) were cultivated and mostly underfood crops, while natural and improved pastures had increased by 10%since 1975 and now cover about 4,200 ha; and

(c) the actual net value of production is about US$1.01 million, i.e.the same as that of 1975 (in 1980 terms) and only 48% of thatprojected at completion for 1980.

4.08 All indications are that cropped areas will decline and pasturearea and livestock production will increase unless the drainage problemsare resolved, thus eliminating part of the risk confronting agricultural

production. Improved pastures tend progressively to substitute for naturalpastures and undeveloped land; a trend towards better breeding techniques andintroduction of improved cattle can also be noted. Poor drainage remains,

however, the most serious limiting factor to wider introduction of improvedpastures in a number of districts.

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4.09 The project target at the time of appraisal in 1967 was to raise theminimum net family incomes from an average of US$500 to the equivalent ofabout US$2,000 (in 1980 terms) by 1980. Based on the predominance of highvalue crops planned at appraisal, net family incomes were expected to reachthe equivalent of US$4,300-6,000 in Part I and slightly more than US$2,000 inPart II at full development. At completion, in 1975, it was found that familyincomes in Part I and Part II were about US$2,300 and US$960 (in 1980 terms)respectively and were projected to reach about US$4,300 and $1,650 at fulldevelopment in 1980, i.e. an increase in pre-project family incomes of morethan eight times in Part I and 3 times in Part II.

4.10 By 1981, however, net family income of a typical project settler inthe irrigated area of Part I is estimated to have reached the equivalent ofUS$2,000, reflecting the low cropping intensity and the underutilization ofirrigation water. In Part II, under rainfed conditions, an eleven-ha familyfarm with 30% of the area under crops and 70% under pasture now yields a netfamily income of about US$1,100. These figures show an increase of 4 and 2.2times over pre-project family incomes. When compared with minimum wagesprevailing in agriculture (equivalent to about US$1,000 per annum in 1981),average net family incomes of settlers are only 2 and 1.1 times above theearnings of farm laborers. This explains why settlers with farm sizes belowaverage are inclined to seek part-time, or even full-time, jobs outside theproject area, particularly in Venezuela, an OPEC country, where wages arethree times higher than in Colombia. The satisfaction generally expressed bysettlers to the Impact: Evaluation Mission appears to reflect more theircontentment to be landowners for the first time and to have security of landtenure, rather than appreciation of higher living standards. Other additionalbenefits, not to be underestimated, are the social services provided, includ-ing new schools, health centers, rural electrification and communicationsfacilities which were constructed during project implementation.

4.11 Squatters and small farmers!/ with a 2 or 3 ha farm constitute thepoorest segment of the population. By intensifying their cropping system,they tend to reach a higher productivity per hectare than the settlers,but they remain more subjected to floods, the vagaries of the climate and theuncertainties of marketing. Their net family incomes are likely to reachonly US$500-600, significantly below the minimum wage in agriculture. Theirfuture appears gloomy since land in the Southern Sector has now been entirelyappropriated and developed.

1/ Small farmers who used to live and farm in the area prior to the project.

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V. ECONOMIC IMPACT

5.01 An attempt was made to evaluate the project economic rate of returnof Stage I alone (Part I and Part II totalling 9,300 ha), and on the basis ofthe same costs and benefits allocation used at completion. At appraisal, itwas estimated that the rate of return on Part I would be 11% and on Part II,25%. The high rate for Part II was justified in the Appraisal Report by thelow investments required for flood protection. For both Parts I and II, therate of return was based on assumed benefits from double-cropping of highvalue crops. In view of the unfavorable soil conditions and the high risks of

double-cropping under rainfed conditions, appraisal projections were revisedat completion when it was found that (i) the net value of production at fulldevelopment would reach only 25% of the original projections and (ii) fullagricultural development would not be reached before 1980-81. On the basis ofthese projections and of information on agricultural production available atcompletion, the project ERR was re-estimated at 2.2%. The analysis coveredboth Parts I and II and did not distinguish between the two, since part of theinvestments in drainage, roads and flood protection benefitted both areas andeven Stage II.

5.02 In 1981, the 1975 projections proved to be over-optimistic sincenet value of production only reached 48% of that which was expected for 1980and 12% of that anticipated at appraisal. The project's ERR is now estimatedto reach 1.7%. High investment cost of the irrigation infrastructure (74% ofthe total cost), combined with high operation cost and under-utilization ofirrigation water, is the main reason for the low economic return of theproject. The question was already raised in the PPAR as to whether irrigationshould have been included in the first phase, before the overall area of35,000 ha was fully developed under rainfed conditions and the farmers hadexperience in modern agricultural practices and area-specific problems. Fiveyears later, it can be said that the high investment cost of irrigation wasnot justified economically, and only a limited number of families benefittedfrom this part of the project; in addition, the problem was exacerbated by theproject relying on a sophisticated and costly fixed sprinkler system.

5.03 In retrospect, the major flaw of the project was that no attempt wasever made to fundamentally change the project design and to eliminate theirrigation component when reconnaissance soil surveys and groundwater testingindicated that production of fruits and vegetables for international marketswas impossible. At that time, the project should have been re-designedlimiting it to (i) concentrate on drainage designed to adequately drain bothPhase I and II areas; and (ii) develop the whole project area under rainfedconditions with emphasis on livestock production. Irrigation was certainlynot an effective way to develop the region; improved dry-farming and develop-ment of new lands through properly designed flood protection and drainageworks could have produced acceptable results and a reasonable rate of returnat a fraction of the cost.

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VI. IMPACT ON INSTITUTIONS

6.01 It was customary during project implementation to blame INCORA forpoor preparation and design of the project and for delays in implementation.However, INCORA was at that time a young organization, and the role played bylocal and foreign consultants turned out to be of paramount importance duringboth preparation and implementation of the project. Unfortunately, a prelim-inary soil survey was badly handled by a local consulting firm, and projectpreparation by a foreign consulting firm proved inadequate. In addition,although INCORA was nominally responsible for project implementation, the Bankrequested that consultants be recruited to manage the project during theconstruction period and for at least five years thereafter. The consul-tants were to be responsible for "all technical aspects of agriculturaldevelopment, including selection of cropping patterns and cultural practices,maintenance of quality standards, processing and marketing, and would be givenwide latitude for independent decision and action in these matters."l/

6.02 In retrospect, the Bank requirement appears ill-founded in a countryas developed as Colombia in 1967 and proved to be damaging to the project byunnecessarily dividing project responsibilities between INCORA and the consul-tants. Consultants were undoubtedly needed for the detailed technical designbut not necessarily for project management. Consultants played a major rolein designing, organizing and managing the CAC, which turned out to be the mostdismal failure. The Bank passively witnessed the creation, deterioration anddisintegration of the cooperative system despite INCORA's reluctance to pursuewhat soon appeared to be an unfortunate experience. Following CAC's collapse,the consultant's contract was terminated in 1975 instead of 1977 as initiallyplanned, and INCORA was left alone to shoulder the blame for the project'sfailure.

6.03 In contrast to this, it is surprising that the project, which wasthe first of its type ever to be undertaken by INCORA, had a strong andbeneficial influence on the development of this organization. Many of theprocedures and the methodology which became standard for other projectsemerged from the operations and problems experienced by the Atlantico project.Many of the INCORA staff members who later assumed more responsible positionsreceived their practical training through the project. INCORA initiatedagrarian reform and land development in 35 specific areas throughout Colombiaand became the most important institution in the country responsible forexecuting land development projects and providing assistance to small farmers.After project completion, Government interest in agrarian reform diminishedand this led to a reorganization of INCORA and a reduction of its activities.However, INCORA remains responsible for most of the agricultural extensionservices in the whole Atlantico area, with a staff of 96 both in Barranquilla

1/ Appraisal Report, para. 5.03.

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and at field level. As noted above (para. 3.11) INCORA also establishedsuccessful training programs for men and women and literacy programs forchildren. Technical assistance to settlers is reasonably good, with oneextension agent dealing with 128 farmers and 1,213 ha, but INCORA's effec-tiveness is hampered by the small number of livestock specialists.

6.04 After project completion, responsibility for operation and main-tenance (O&M) of the irrigation and drainage system was transferred to theHydrology, Meteorology and Land Development Institute (HIMAT), which is nowresponsible for the implementation and the O&M of main irrigation and drainagesystems in Colombia. HIMAT is not adequately equipped to maintain the drain-age system of the Atlantico South Sector, and its US$645,000 annual budget forO&M of the project works (Phase I and II) is estimated to cover only 60% ofactual requirements. HIMAT is also responsible for collecting water charges,including a fixed levy of US$20/ha/year and a volumetric charge of 4 cents/m3,as well as a drainage fee of US$6/ha/year in the rainfed sector. Cost recov-ery rates are low (about 10%) as farmers are reluctant to pay for irrigationand drainage services they consider inefficient. The cost recovery rate isnot expected to increase in the near future unless rehabilitation of thedrainage system is implemented.

6.05 In conclusion, it can be said that the project's impact on institu-tion building has been strong during implementation and profitable to thecountry as a whole. However, this impact had little long-term effect, mostlydue to a change in government policy regarding agrarian reform and agricul-tural development as well as to the national budget constraints of the recentyears.

VII. FUTURE PROSPECTS

7.01 Deficiencies of the drainage system now constitute the main con-straint to crop and livestock development of the Atlantico Southern Sector.The problems are particularly severe in the Manati area and were notablyaggravated by the completion of the drainage network under Phase II (para.2.04). Reinforcing the pumping capacity of the Boquitas station, changing thedrainage layout, and improving maintenance of the drains are among the solu-tions now being reviewed by HIMAT's consultants. There is no doubt that inthe absence of remedial action the current situation is doomed to deterioratebecause of increasing siltation of canals and obsolescence of the pumps.During the Impact Evaluation mission, a large part of the Manati subzone wasflooded and local farmers expressed their anger and their intention to damcanals upstream from Manati in order to protect themselves against waterflowing in from neighboring districts. A situation of this kind may lead toconflicts between villages and to social unrest. In the mission's view, theimportant social benefit of the project and existing crop and livestockproduction can only be preserved by additional investments in rehabilitatingthe drainage system.

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7.02 Expanding irrigation should not be considered until the overall areais fully developed under rainfed conditions and farmers have gained experiencein modern agricultural practices. In addition, the risk of increasing soilsalinity and alkalinity is higher under irrigation than under rainfed condi-tions, and the results of irrigated crops have not been conclusive so far inPart I.

7.03 Helping farmers to organize themselves and overcome their reluctanceto mutual cooperation appears of utmost importance. Because of the remotenessand difficult living conditions in the project area, only strong and efficientservice cooperatives would permit sound solutions to problems of marketing,input supply and mechanization, which today hamper agricultural developmentand compel settlers to remain subsistence farmers. Livestock productionproved to be a suitable alternative and a partial solution to soil deficien-cies and drainage problems. However, milk and cheese production, which provedprofitable for some individuals, cannot be developed on a large scale unlessan adequate marketing system is established. Similarly, the need for eachfarmer to go to Barranquilla to purchase inputs and agricultural equipmentnow constitutes a serious problem for most of the small farmers.

VIII. CONCLUSIONS

8.01 With the benefit of hindsight it can be said that the Government'sdecision to transform the economy of the depressed Atlantico area throughagrarian reform and agricultural development was correct. It is unfor-tunate that the project was poorly prepared and appraised, that the feasibil-ity study and the first soil survey were superficial and that information anddata provided by the consultants were not sufficiently critically reviewed bythe Bank and checked for accuracy, completeness and consistency. The proj-ect, as approved by the Bank, was overly optimistic and complex and did notproperly take into account some of the regional constraints such as poor soilquality, difficult drainage conditions and limited availability of people withany farming experience. The case illustrates the difficulties of developingnew land: if any land has not been developed by the end of the 20th century,it is likely that severe technical problems exist, and these have to becarefully reviewed before implementation of any project; if the project isdesigned to settle unemployed and unskilled people, it is unrealistic toassume that agricultural development can be quickly achieved through sophis-ticated irrigation methods and modern cropping techniques.

8.02 When it became evident that the project area would never be trans-formed into a garden producing large amounts of citrus, other fruits andvegetables for international markets, hope remained that a collectivizedproduction system of annual crops for internal markets was still feasible, andabout 1,000 settlers were grouped into the Cooperativa Agropecuaria delCaribe. The bankruptcy of CAC and the end of the cooperative system in theproject area show that a. settlement project which is not based on a self-help

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concept and presupposes relinquishing of rights to farm individual plots islikely to fail. Moreover, this unfortunate experience, based on systemsmodeled after those in other countries and not adapted to local conditions,had and still has an adverse effect on the whole region.

8.03 Compared with appraisal expectations as well as with the new planswhich were worked out two years later, and even with the situation prevailingat completion, the project appears a failure in many respects today. Expecta-tions at appraisal were too optimistic. The question is whether or not thearea's real potential could have been recognized at that stage and projectionsmade which would have estimated attainable results with a higher degree ofaccuracy.!' The area is of low potential, its remoteness accentuatesmarketing and input supply problems, farming is risky, credit is scarce andmost of the settlers were and still are unskilled farmers. By turning tolivestock production and food crops to sustain their basic needs, settlersproved to be smarter and more flexible than the Bank or project authorities.Had the project limited its objectives to settling farmers, properly resolvingthe drainage problems and helping farmers develop livestock production andfoodcrops and supported them in building an efficient service cooperativesystem, the project would have been less costly and probably economically moreviable. The major flaw of the project was that overall feasibility andproject targets were never reconsidered and an entirely different and moremodest approach to developing the area was never sought.

8.04 As an investment project and in economic terms, the AtlanticoProject must be termed a failure. However, its social impact is high. About1,250 landless families have been settled in both Phase I and II areas. Anorderly agrarian reform program has been carried out, and an acceptable andstable condition of land tenure has been achieved. Agricultural development,though much lower than anticipated, has improved the economy of the area,halted the former complete dependence on a declining fishing industry andprovided more secure and adequate incomes for the local population. In

1/ CPS notes that "During the 1960s, adequate field and laboratory tech-niques were available to enable the consultants, the borrower's agency orthe Bank to recognize the widescale presence of saline and alkalinesoils. Furthermore, engineering knowledge at that time should haveensured the recognition that drainage design criteria were or were notadequate to meet the needs of local soil and rainfall characteristics.It should be noted also that poor drainage, salinity and alkalinity areeach correctable deficiencies. The need is for those involved in landsuitability classification to recognize their presence and to makerealistic estimates of the cost of remedial measures in evaluating landsuitability and project economic feasibility. Almost certainly, ifproper procedures had been followed and alternatives evaluated, the moreappropriate project for land drainage and rainfed production would havebeen arrived at."

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addition, about 2,420 small private farmers and squatters have benefitted fromproject investments and social infrastructure established during projectimplementation. Despite its shortcomings, the project has had a positiveimpact on the incomes and living standards of about 26,000 people in theproject area. The project fulfilled, in an unforeseen way, the Government'soriginal objectives of improving social and economic conditions for the poorand correcting the inequities of the old land tenure system. However, theproject's positive social impact appears jeopardized in the future by thedeficiencies of the drainage system and the subsequent risks of worseningfloods, which may lead to large scale abandonment of farms.

8.05 The Atlantico project also contributed some important, althoughnot measurable, benefits 1:hrough institution building. A considerable numberof professionals were trained through the project, including many who were tobecome INCORA executives. One major contribution of the project was thebuild-up of economic and technical capacity in INCORA, which permitted it tohandle different kinds of development projects, both in rainfed and irrigatedagriculture.

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- 23 - APPENDIX 1Page 1

BORROWER'S COMMENTS

Translation of cable received from INCORA - Atlantico Regional Director.

"I share findings of Impact Evaluation Report Atlantico,Credit 502-CO. Government will send comments through University ofAgriculture. Regards, Manuel Linero."

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- 25 - APPENDIX 1

Page 2

Dr. Fernando Royos P.Private Secretary toMinister of Agriculture

Bogota Bogota, May 24, 1982

Rot DT Loan 502/CO

Dear Dr. Hoyos:

Regarding the final ealuation of the Atlintico ProJect partially

.nanced by the loan undler reference, I wish to inform you that this-report

accurately reflects vhalc happened during the project's execution and subsequent

history, acknowledging 'he mistakes made both by INCORA and by the Bank and the

consultants who prepare& the project and advised INCORA on its implementation.

Notvithstanding the foregoing, it is satisfactory that now that the

evaluation has been completed, it has been concluded that the implementation

of the project furthered in various vays the development of the area and the

improving of the living standards of the campesino, something that had never

been considered becausat execution of the project was alvays compared against

the targets set in the initial project, which was very much out of line with

the actual conditions prevailing in the area. In this connection, the report

submitted by the Bank brings out clearly and unquestionably the situation

experienced in that project. It is also quite accurate in its references

to institutional circumstances during its execution and to technician training

In this field.

However, while the conclusions reflect a situation now past concerning

wbich no action can bit taken, the chapter relating to future expectations does

not provide a detailedl analysis of certain problems that this office considers

highly important and which I feel varrant emphasist


1. For all projects involving partial financing of works, appropriate

steps should be taken to ensure availability of counterpart resources at the

time of execution and therefore to identify the sources of the resources needed

for the operation and maintenance of the works and not, as was the case this

time, once it has become necessary to virtually reconstruct a district due to

an almost total lack of maintenance resources.

2. The development policy for the area Vas not the most effective in that

no thought was given to the interrelationship between the various zones of

activity of the Atlantico project (Santa Lucia, Repelon and Manatpi), nor was

advantage taken of the experience gained by the agencies during the execution

of these three projects, so that in many cases the same mistakes were repeated.

3. It would be desirable for future loan agreements to include a clause

that vould facilitate the transferring of resources from one category to another

so that the project executing agencies, acting in agreement with Bank supervision

missions, can effect such transfers without the cumbersome and time-consuming

procedures currently required which in practice make it impossible to amend the

original project even if the conditions which were the reason for the loan have

changed.

I. Finally, I would like to note that the social situation in the area

in question is becoming daily more critical, and serious social problems are

expected in the short term unless the Government steps in to provide a final

solution to the recurrent flooding problems suffered by the area which have

reduced the farmers to a subsistence existence, swollen, INCORA's portfolio

of bad debts and made it impossible to recover the investment made in these works.

Sincerely,

/s/ Pedro Jose Ramirez RamirezGeneral Manager


National Planning Department

UEA - 101 Bogota, May 26, 1982

Mr. Shiv S. KapurDirectorOED

Dear Mr. Kapur:

We have received your "Impact Evaluation Report, Atlantico Irripa3tion

Project", which we have carefully reviewed. The report is indubitably a careful

analysis of the impact of the project on the region and its inhabitants. We

bave nonetheless taken the opportunity to make a few brief comments which we

hope will be useful in preparing the final version of the report.

Yours, etc.

/a/ Alvaro Silva

Chief, Agricultural Studies Unit


COM4ENTS ON "IMPACT EVALUATION REPORT, ATLANTICO IRRIGATION PROJECT"

(Credit 502-CO)

The evaluation report is quite extensive and includes the background,

description, implementation, effects and prospects of the project. On each

point some questions are raised which it would be useful to clarify in the report.

Firstly, there is in our view excessive emphasis on the historical

background, while the economic background is largely ignored. TLere is no

mention of the pre-feasibility study, if one was made, or the feasibility study

that preceded the granting of the loan. A question immediately arises as to

the Bank's reasons and criteria in granting this first loan, especially when

it is recalled that, as is shown later, both the feasibility study and the soils

study proved to be unreliable and to a large extent were responsible for the

failure of the project. The Bank basically limited itself to assessing INCORA's

administrative capacity and to proposing a sub-division of the Atlantico

project, without bothering to make a critical review of the actual design of

the project.

As regards the description and implementation of the project, the report

is somewhat confusing, though this can be explained by the changes that were

made in project definition. According to the report, of the ten or more project

objectives (part 1 and part 2) only some were partially achieved. It would

be useful to compare these objectives and the results in turn in order to evaluate

and explain the causes of the delays and failures to attain targets. In places

the report gives considerable space to what it considers as one of the successes

of the project, namely agrarian reform. But as regards the drainage system, for

example, it merely lists the reasons for deficient performance but does not

explain the causes; although it is clear that this was a case of poor design, there

is no explanation of why remedial measures were never taken. Likewise, inadequate

maintenasce and the lack of equipment were not in themselves an explanation of the


shortcomings of the draim &ge system, especially if it is remembered that these

tvo points (maintenance sa.d equipment) should have been planned as part of project

design. Even more surprising is the fact that no explanation is given as to why

the pumping stations have not yet been connected to the central electricity network.

Other objectives, such as the introduction of marketing facilities and trial

farms, are not evaluated at all.

As regards agrariEan reform, which is regarded as one of the successes of

the project, it is undeniable, as the report indicates, that from a redistributionpoint of view its implementation was important; however, from an economicpoint of view -- and the report does not dwell on this -- it would seem to have

been a failure, insofar ags the investment did not produce a substantial improvement

in family income, and also led to the establishment of a group of settlers on lands

that are not very productive, as a result of their small size and poor conditions.

Surely an increase of 650% in the population and a reduction of 85% in the average

size of farms cannot be regarded as successes if they are not accompanied by the

kind of improvement in iamily income and in the living standards of the population

that would justify the substantial investment made.

The biggest question raised by the entire document is why the project was

never redesigned when from the first years it was realized--so it would appear-

that construction of a sprinkler irrigation system was not really viable because of

poor soil conditions.

As regards project prospects, it seems very unlikely that a cooperative

can be organized again and it is strange that, after an analysis of the complete

failure. of the coopereative system, it is proposed to revitalize it using new

features which nonetheless are not specified.

- 30 - APPENDIX 1

Page 7

Republic of Colombia

Ministry of Agriculture

Bogota, May 24, 1982

Mr. Shiv S. KapurDirector, Operations Evaluation DepartmentWorld BankWashington, D.C.

Ref: 000670

Subject: Impact Evaluation Report -- Colombia Atlantico Irrigation Project(Loan 502-CO)

Dear Mr. Kapur:

In reply to your letter of March 17 on the above-mentioned report, Iam pleased to inform you that we regard as satisfactory the Bank's evaluationof the activities carried out by HIMAT.

As for the work carried out by INCORA, the Bank clearly and unequivocablyreflects the situation experienced with the project. It is also quiteaccurate in its references to institutional circumstances during projectimplementation and the training of technicians in this area.

It would be desirable for future loan agreements to include a clausefacilitating the transfer of funds from one category to another so that theproject executing agencies, acting in agreement with Bank supervision missions,can effect such transfers without the time-consuming formalities requiredat present, which in practice make it impossible to amend the originalproject even if the conditions that were the basis for the loan have changed.

Cordially,

Isl Lufs Fernando Londono CapurroMinister of Agriculture

-31- ANNEX 1Table 1Page 1



COST ESTIMATE AT APPRAISAL/a

Part I - Irrigation Local Foreign Total(US$'000)

1. Engineering Works

a. Main Pumping Stations 150 440 590b. Canals and Structures 115 230 345c. Sprinkler System 100 1,510 1,610d. Drainage and Levy Strengthening 540 350 890e. Roads and Structures 115 230 345f. Electrical Generation and Distribution 60 660 720g. Land Preparation 70 130 200h. Pilot Farms 275 465 740i. Engineering and Supervision (including

25% contingency) 1,075 285 1,360

Sub-total 2,500 4,300 6,800

2. Operation and Maintenance Equipmentand Spare Parts -- 210 210

3. Spare Parts for Permanent Equipment -- 160 160

Sub-total -- 370 370

Agricultural Investment and Supporting Services

4. Agricultural Machinery and Spare Parts -- 820 820

5. Establishment of Perennial Crops and TobaccoDrying Facilities 220 -- 220

6. Orange Packing-hous, and Equipment(including 25% contingency) 170 200 370

7. Establishment of Field Trial Farms and Nurseries 90 220 310

Sub-total 480 1,240 1,720

Common Services and General Administration

8. Consulting Services 120 1,520 1,640

9. Vehicles -- 150 150

10. Buildings and Utilities 220 30 250

Sub-total 340 1,700 2,040

TOTAL Part I 3,320 7,610 10,930

/a Contingencies of 15% are included in all items except where otherwisespecified.

-32 - ANNEX 1Table 1Page 2



Part II - Flood Protection Local Foreign Total(US$'000)

11. Engineering Works

a. Interceptor Channel and Structures 390 310 700b. Access Roads to Farms and Drainage 370 250 620c. Contingency 15% 115 85 200d. Engineering and Supervision (including

25% contingency) 115 65 180

Sub-total 990 710 1,700

12. Operation and Maintenance Equipment -- 50 50

13. Buildings and Utilities 30 10 40

Sub-total 30 60 90

TOTAL Part II 1,020 770 1,790

Other Expenditures

14. Buildings and Utilities Allocable to FutureStages 110 20 130

15. Feasibility Studies for Future Stages ofIrrigation (nil Contingency) 200 100 300

16. Training Abroad (nil Contingency)

a. Atlantico Project Personnel -- 160 160

b. General Strengthening of INCORA Staff -- 340 340

17. Interest during Construction (6% per annum onIBRD loan) 1,290 -- 1,290

18. Future Additions to Orange Packing-houseEquipment to complete the Project (including25% Contingency) 300 -- 300

19. Land Purchases by INCORA 500 -- 500

Sub-total Other Expenditures 2,400 630 3,020

TOTAL Project Costs 6,740 9,000 15,740

ANNEX 1Table 2



SIZE DISTRIBUTION OF RURAL PROPERTY INSOUTHERN PART OF ATLANTICO PROVINCE IN 1966

Size of Property Properties Owners Area

No. of Properties % No. of Owners % Hectares %

Less than 10 ha 267 31.3 290 35.8 1,150 3.8

10-100 ha 462 54.3 426 52.6 11,773 39.0

Larger than 100 ha 123 14.4 94 11.6 17,253 57.2

Total 852 100.0 810 100.0 30,176 100.0

AVERAGE FARM SIZE(in hectares)

Size Class Area Per Property Area Per Owner

Less than 10 ha 4.3 3.9

10-100 ha 25.5 27.6

Larger than 100 ha 140.2 183.5

Source: Feasibility report on Atlantico No. 3 Project (dated November 1965)prepared for INCORA by Alfonso Olarte C. Ingenieria y construccion(Bogota); and Development and Resources Corporation (New York).

ANNEX 1Table 3Page 1 of 2



COMPARISON OF ESTIMATED COSTS AND ACTUAL EXPENDITURES

Expenditures as ofEstimated Costs 06/30/76

Items Loan Local Total Loan Local Total…-----------------------US$ 000-----…

Part I - Irrigation

1. Engineering Worksa. Main Pumping Stations 440 150 590 415 283 698b. Canals and Structures 230 115 345 400 529 929c. Sprinkler Systems 1,510 100 1,610 1,097 - 1,097d. Drainage and Dikes 350 540 890 921 1,222 2,143e. Roads and Structures 230 115 345 130 170 300f. Power Generation and Distribution 660 60 720 672 51 723g. Land Preparation 130 70 200 64 206 270h. Pilot Farms 465 275 740 231 549 780i. Engineering and Supervision 285 1,075 1,360 - 600 600

2. Operation and Maintenance Equipment 210 - 210 1,038 - 1,0383. Spare Parts for Equipment 160 - 160 - - -

4. Agricultural Machinery 820 - 820 717 - 7175. Establishing Perennial Crops - 220 220 - 220 220

6. Orange Packing-House and Equipment 200 170 370 - - -7. Field Trial Farms and Nurseries 220 90 310 - 230 2308. Consulting Services 1,520 120 1,640 1,692 624 2,3169. Vehicles 150 - 150 241 - 241

10. Buildings and Utilities 30 220 250 214 284 498

Sub-total, Part I 7,610 3,320 10,930 7,832 4,968 12,800

ANNEX 1Table 3Page 2 of 2



COMPARISON OF ESTIMATED COSTS AND ACTUAL EXPENDITURES

Expenditures as ofEstimated Costs 06/30/76

Items Loan Local Total Loa. Local Total_ _____-_ …_____---- US$ 000… - …

Part II - Flood Protection

11. Engineering Worksa. Interceptor Canals 310 390 700 300 397 697b. Drainage and Access Roads 250 370 620 230 305 535c. Contingencies 85 115 200 - - -d. Engineering and Supervision 65 115 180 - 190 190

12. Operation and Maintenance Equipment 50 - 50 33 - 3313. Building and Utilities 10 30 40 - - -

Sub-total, Part II 770 1,020 1,790 563 892 1,455

Other Costs

14. Future Buildi.igs and Utilities 20 110 130 - - -15. Feasibility Study for Stage II Project 100 200 300 85 215 30016. Training 500 - 500 178 25 20317. Interest During Construction - 1,290 1,290 - 2,093 2,09318. Future Expansion of Orange Packing-House - 300 300 - -19. Land Purchases - 500 500 - 360 360

Sub-total Other Costs 620 2,400 3,020 263 2,693 2,956

Total Cost of Project 9,000 6,740 15,740 8,658 8,553 17,211

ANNEX 1Table 4



ALLOCATION OF THE PROCEEDS OF THE LOAN(US$ million)

Original As Revised As Revised Actual DisbursementsCategory June 29, 1967 April 18, 1973 Sept. 12, 1974 August 31, 1976

A. Civil Works

I. Construction and Installation 2.5 2.5 2.6 2.7

II. Generators, pumps, line equipment,valves and accessories, sprinklerequipment, asbestos-cement pipes,orange packing-house equipment,and other equipment, supplies andmaterials to be incorporated intocivil works 2.2 2.2 2.0 2.1

B. Machinery, Agricultural Items,Consulting Services and Training

I. Agricultural machinery and equip-ment, imported planting material,operation and maintenance equip-ment including motor vehiclesand spare parts 1.3 2.4 2.4 1.9

II. Consulting services and training 1.9 1.9 2.0 2.0

C. Unallocated 1.1 _ _ _

Total 9.0 9.0 9.0 8.7

- 37- ANNEX 2Table 1



DISTRIBUTION OF FARM FAMILIES IN THE PROJECT AREA (1981)

(Stage I and II Areas)

Area Settlers Private Farmers* Total

Area (ha), Families Area (ha) Families Area (ha) Families

Manati 7,667 735 1,680 1,156 9,347 1,891

Candeleria 1,462 147 407 507 1,869 654

Campo de la Cruz 2,528 190 3,513 714 6,041 904

Santa Lucia 1,738 180 344 22 2,082 202

Total 13,395 1,252 5,944 2,399 19,339 3,651

* Including squatters.

- 38 - ANNEX 2Table 2



LAND ACQUISITION BY INCORA (1965-1981)

(Stage I and II Areas)

Area Purchase Expropriation Permutation Total

Units Ha Units Ha Units Ha Units Ha

Campo de la Cruz 28 841 1 175 - - 29 1,016

Candeleria 14 669 1 800 - - 15 1,469

Manati 29 3,695 7 1,521 - - 36 5,216

Juan 4 660 2 127 - - 6 787

Santa Lucia 18 822 - - 1 76 19 898

Total 93 6,687 11 2,623 1 76 105 9,386

- 39 -ANNEX 2Table 3



DISTRIBUTION BY YEAR OF LAND ACQUISITION BY INCORA(in hectares)

Campo de SantaYear la Cruz Candeleria Manati Juan Lucia Total

1965 646 - 285 - - 9311966 - 159 591 106 96 9521967 - 36 1,107 - 65 1,2081968 - 40 459 554 - 1,0531969 17 - 374 - 161 5521970 - 114 762 - 372 1,2481971 100 129 340 - 166 7351972 - 872 - - - 8721973 - - 24 - - 241974 - - - - 38 381975 - - 591 - - 5911976 78 - 244 - - 3221977 - - 182 - - 1821978 175 80 - 41 - 2961979 - 39 129 - - 1681980 - 21 86 - 1071981 - - 107 - - 107

Total 1,016 1,469 5,216 787 898 9,386

ANNEX 2COLOMBIA: ATLANTICO IRRIGATION PROJECT Table 4

(Loan 502-CO)


Evolution of Cash Crops in the Settlement Area

7.000

6.00 0

5.OOC

4.000

0

2.000

1.000

0-

1970 1971 1972 1973 1974 1975 1976 1977 1978 1.979

YEARS

-A - ANNEX 2

Table 5



DISTRIBUTION OF LAND USE BY DISTRICT IN STAGE I AND II AREAS (1980)(Including double-cropping - in hectares)

Campo de SantaLand Use/District Manati la Cruz Candeleria Lucia Total Percent

Irrigation

Crops - - - 460 460 (49)Pasture - - - 480 480 (51)

Total - - - 940 940 100

Rainfed

Crops 3,379 1,789 111 185 5,464 (30)Pasture 5,968 4,252 1,759 944 12,923 (70)

Total 9,347 6,041 1,870 1,129 18,387 100

- 42 - ANNEX 2Table 6



LAND USE BY SETTLERS IN STAGE I AND II AREAS (1980)(In hectares)

Campo de SantaLand Use/District Manati la Cruz Candeleria Lucia Total

Crops

Irrigated AreaFood Crops 99 99Cash Crops - - - 293 293

Subtotal - - - 392 392

Rainfed AreaFood Crops 2,133 379 54 141 2,707Cash Crops 619 - - 44 663

Subtotal 2,752 379 54 185 3,370

Pastures

Irrigated AreaNatural Pasture - - - 47 47Improved Pasture - - - 170 170

Subtotal - - - 217 217

RainfedNatural Pasture 2,172 617 1,003 505 4,297Improved Pasture 2,385 1,507 367 405 4,664Undeveloped Land 359 24 38 34 455

Subtotal 4,916 2,148 1,408 944 9,416

Total 7,668 2,527 1,462 1,738 13,395

-43- ANNEX 2Table 7

IIIPACT EVALUATION REPORT


LAND USE BY PRIVATE FARMERS UNDER RAINFED CONDITIONSIN STAGE I AND II AREAS (1980)

1975 1976 1977 1978 1979 1980

Land Use

Rainfed crops (ha) 1,455 1,963 1,771 2,087 2,586 2,094

Pasture (ha) 4,145 3,637 3,829 3,513 3,014 3,506

Total (ha) 5,600 5,600 5,600 5,600 5,600 5,600

- 44,-- 44 - ANNEX 2

Table 8



KEY INDICATORS

SUMMARY OF ACTUAL AND PROJECTED CULTIVATED AREA, NET VALUE OFPRODUCTION, AND NET INCOME PER FAMILY IN STAGE I AREA

Area Cultivated (Including Double-cropped) (ha)

1982 1972 1975 1980 1980(Projected at (Projected at Com-Appraisal) (Actual) (Actual) pletion in 1975 (Actual)

Part I

Field Crops 5,695 649 650 4,000 460Livestock - 183 2,600 400 2,840/-a

Subtotal 5,695 832 3,250 4,400 3,300

Part II

Field Crops 6,400 3,393 2,188 3,000 1,800Livestock - 3,700 3,812 4,000 4,200

Subtotal 6,400 7,093 6,000 7,000 6,000

Net Value of Production(US$ 1980)

Part I 6,090 114 680 1,300 388Part II 2,810 661 334 900 623

Total 8,900 775 1,014 2,200 1,011

Net Income - Per Family

Part I 4,300-6,000 - 2,300 4,300 2,000Part II 2,050 - 960 1,650 1,100

/a Of which about 480 ha is irrigated pasture.

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Roads so tr embankmsen ,oiet

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L -- 6 reStreoms/

PROJECT FEATURES FlGaao ~.l• 6es

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Secondary roads A'eA,rvo,Roads -tn embankm,ent

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Fi.an,ced under laxe 502-CODa

Project bocndary For Ioan 847-CO

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