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         First multistate agricultural development project
  


The Nigeria First Multistate Agricultural Development project, supported by Loan 2733-UNI for US$162.0 million, was approved in FY86. The loan was completely disbursed and closed on June 30, 1995, three years later than planned. The International Fund for Agricultural Development (IFAD) provided cofinancing of US$12.0 million for a cassava improvement component that closed after the loan. The Africa Regional Office prepared the Implementation Completion Report (ICR). The borrower participated in the completion mission and prepared its own ICR (the executive summary is attached as appendix B). A separate ICR is being prepared for the IFAD component, but comments on this ICR have not been received from IFAD.

The project’s objectives were to increase food production and incomes for small farmers in seven states in the south and center of the country, to assist these states in rationalizing agricultural support activities, and to prepare local institutions to assume more responsibility for future project appraisal and supervision. The main components aimed to (i) rationalize extension services and implement agricultural improvement programs (including the multiplication and distribution of improved seed and planting material); (ii) support adaptive farm research; (iii) encourage commercial services, including the progressive privatization of the preexisting distribution system; (iv) rehabilitate and improve the maintenance of rural roads; (v) expand rural water supplies; (vi) support project management, monitoring and evaluation, planning, and manpower development units; and (vii) establish a national cassava multiplication and development program.

The project achieved most of these objectives, although implementation was delayed by shortfalls in counterpart financing and frequent political changes, including the division of 4 of the initial states, which brought the total number of project states to 11. An Agricultural Development Project (ADP) was implemented in each state by semi-autonomous Project Management Units chaired by the State Commissioner for Agriculture. The ADPs took over from the state ministries responsibility for extension, adaptive research, and input supply. The extension programs were generally successful, and the production of target crops increased significantly.

The outcome of the effort to improve commercial services was much less satisfactory. The ADPs supplied inputs at below-market rates, took few steps toward privatization, and concentrated on their own seed farms (which had inadequate capacity) rather than promoting outgrower production of seed or other approaches. The national cassava program did build up a network of growers for multiplication of planting material and rapidly increased supplies of new, high-yielding, and disease-resistant varieties. Performance of the infrastructure components varied widely by state. Some two-thirds of the anticipated rehabilitation was undertaken, though with less participation than planned. The subdivision of states and consequent new operational and supervisory entities hindered efforts to improve project management. In particular, some new political supervisory bodies caused significant delays by attempting to interfere directly in issues such as procurement.

The ICR reestimates the economic rate of return (ERR) at 33 percent, compared with the appraisal estimate of 24 percent. But the reestimate is based on the overoptimistic assumption that all of the increase in the production of targeted crops in the participating states can be attributed to the project.

The Operations Evaluation Department (OED) lowers the ICR rating for project outcome from satisfactory to marginally satisfactory, as the project only partially achieved most of its objectives. OED rates institutional development as modest rather than substantial because of the limited progress made in input distribution and the development of infrastructure maintenance capacity. Sustainability is raised to likely from uncertain, however, because most of the programs are now well established at the state level and are likely to receive continued (if somewhat reduced) funding. OED agrees with the ICR rating of Bank performance as satisfactory.

The principal lessons from this project are that managing pooled funds in multistate projects requires careful monitoring to reduce the risk of overcommitments by competing implementing agencies, and that when new oversight bodies are established, efforts are needed at the outset to clarify their role in order to avoid disputes and delay.

The ICR is satisfactory, providing a good account of project implementation. However, it does not offer any data in support of the reestimated ERR, instead accepting the estimate from the borrower’s ICR without comment.

An audit is planned.




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