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1 Public Disclosure Authorized Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE UNITED REPUBLIC OF TANZANIA FOR THE DAR ES SALAM PORT ENGINEERING PROJECT December 5, 1979 Report No. P-2668-TA This document kms a resricted distribution and may We used by recipients only in the performance of their offical duties. Its contents may not otherwise be disclosed without World Bank autborization.

2 CURRENCY EQUIVALENTS Currency Unit = Tanzanian Shilling (TSh.) US$1.00 = TShs TSh. = US$0.12 (As the Tanzania Shilling is officially valued in relation to a basket of currencies, the US Dollar/Tanzania Shilling exchange rate is subject to change. Conversions in this report were made at US$1.00 to TShs which is close to the 1979 average exchange rate.) WEIGHTS AND MEASURES 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 miles (mi) 1 square kilometer (sq km) = square miles (sq mi) GLOSSARY OF ABBREVIATIONS EAC - East African Community EAHC - East African Harbours Corporation MCT - Ministry of Communications and Transport MFP - Ministry of Finance and Planning MOW - Ministry of Works NMC - National Milling Corporation ODA - Overseas Development Administration (UK) TANZAM - Tanzania/Zambia TAZARA - Tanzania-Zambia Railway Line TCSL - Tanzania Coastal Shipping Line, Ltd. TRA - Tanzania Harbours Authority TRC - Tanzania Railway Corporation ZTRS - Zambia-Tanzania Road Services FISCAL YEAR Government : July 1 - June 30 Tanzania Harbours Authority: July 1 - June 30

3 FOR OFFICIAL USE ONLY TANZANIA DAR ES SALAAM PORT ENGINEERING PROJECT CREDIT AND PROJECT SUMMARY BORROWER: BENEFICIARY: AMOUNT: TERMS: United Republic of Tanzania Tanzania Harbours Authority (THA) US$2.5 million equivalent Repayable in 10 years including 2 years of grace and carrying a service charge of 3/4 of 1% per annum. The credit would be refinanced under any subsequent credit or loan the Bank Group may provide to implement a proposed Harbours Project at Dar es Salaam. RELENDING TERMS: The proceeds of the credit would be onlent to the Tanzania Harbours Authority for 10 years including 2 years of grace at an interest rate of 7.95% per annum. The exchange risk would be assumed fully by THA. PROJECT DESCRIPTION: The proposed credit is intended to finance the detailed engineering designs and the preparation and evaluation of tenders required for Civil Works under a proposed Harbours Project in order to firm up the cost estimates for the Project. The engineering credit would finance: (a) a feasibility study of the location of a bulk grain silo; (b) preliminary and final engineering designs, cost estimates and tender documents for a bulk grain silo (with a ship unloader, conveyor system and elevator) and an import storage warehouse; (c) final engineering designs, cost estimates and tender documents for (i) deepening and straightening of the entrance channel, (ii) a container facility, (iii) the replacement of the petroleum jetty, and (iv) a harbour tug berth; and (d) assistance to THA in prequalification of interested civil works contractors and in the evaluation of civil works tenders. This document has a restrictedistribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

4 - ii - The risk involved in the proposed engineering project is minimal as the same consultants who carried out satisfactorily the updating study of the port of Dar es Salaam had been selected for the engineering services and as no major delay is anticipated. ESTIMATED COSTS: 1/ Local Foreign Total (US$ million) Engineering Consultants: Home Office Overseas (Tanzania) Sub-Contracts Support, subsistence and transport Subtotal Price contingencies Physical contingencies Total Engineering Cost Net of Taxes and Duties FINANCING PLAN: The proposed credit would finance the foreign exchange component of the engineering services; the remaining US$.5 million in local costs would be financed by THA. ESTIMATED DISBURSEMENTS: IDA Fiscal Year (US$ million)----- Annual Cumulative RATE OF RETURN: Not applicable 1/ The proj,ect is exempted from identifiable taxes and duties.

5 INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE UNITED REPUBLIC OF TANZANIA FOR THE DAR ES SALAAM PORT ENGINEERING PROJECT 1. I submit the following report and recommendation on a proposed credit of US$2.5 million equivalent to the United Republic of Tanzania to help finance the detailed engineering designs and the preparation and evaluation of tenders for civil works required for a proposed Harbours Project. The credit would carry a service charge of 3/4 of 1% per annum and would be repayable in 10 years including 2 years of grace. The proceeds of the credit would be onlent to the Tanzania Harbours Authority under a subsidiary loan agreement which would be on terms and conditions acceptable to the Association including an interest rate of 7.95% per annum and repayment in 10 years including 2 years of grace. The exchange risk would be assumed fully by THA. The Credit would be refinanced under any subsequent credit or loan the Bank Group may provide to implement a proposed Harbours Project at Dar es Salaam. PART I - THE ECONOMY 2. A Basic Economic Mission visited Tanzania in August The Basic Economic Report was distributed in December 1977 (Report No TA). A new Country Economic Memorandum will be issued later in this fiscal year. A summary of social and economic data is in Annex I. Profile of the Economy 3. Tanzania is one of the 30 least developed countries in the world with a per capita income in 1978 of US$230. The economy is still heavily dependent on agriculture: 90% of the labor force is engaged in agriculture and approximately 50% of GDP and two-thirds of total exports are derived from agricultural production. The industrial sector is still small, producing about 10% of GDP, approximately the same percentage as 11 years ago. The service sector produces about 40% of GDP. Overall population density is low, though a few areas are considered overpopulated. Population growth is estimated at 3.0% per annum with both fertility and mortality at relatively high levels Since the Arusha Declaration in 1967 Tanzania has pursued a socialist development strategy. Banking, insurance, and most large-scale enterprises in manufacturing, plantation agriculture, transportation, and wholesale trade are under state control. There is extensive state intervention in economic activity, including import licensing, foreign exchange controls, price control, the reservation of some activities to the state or cooperative sector, and detailed Government investment planning. The second major feature of Tanzania's development strategy is its strong emphasis on rural development and social programs to benefit the poor and reduce inequalities in income distribution. This is reflected in ambitious programs for the provision of rural water supplies and health services and in the decision to achieve universal entry into primary education beginning in 1977.

6 -2- Long Term Economic Trends 5. In the decade real GDP at factor cost grew at an annual average rate of 4.8%, or about 1.8% per annum per capita. While economic growth was severely disrupted by the economic crisis following the failure of rains and large increases in import prices in 1973 and 1974, the economy has recovered well with annual growth at 5 to 6% for 1976 through During this decade the service sector grew the fastest - 6.3% p.a., followed by the industrial sector - 4.0% p.a. and then agriculture - 3.9% p.a. 6. The Government has a good record of domestic resource mobilization. Between and the share of recurrent revenues rose from 15.1% to 19.3% of GDP. However, most of this increase occurred before Since then revenue has been increasing at a rate below the GDP growth rate (in 1974/75 revenue was 22% of GDP). This increase was achieved through a combination of highly progressive direct taxes and proportional or moderately progressive indirect taxes. Except during the economic crisis in , the rate of national savings has also been high: gross national savings fluctuated at around 16-17% of GNP from the mid-1960s through 1973, fell to half that level during the crisis years and recovered to the pre-crisis level in 1976 and These are high levels of savings for a country at Tanzania's income level. 7. Some progress has also been made in achieving the Government's objective of a more equitable income distribution. Between 1969 and 1975 the average urban rural gap remained approximately constant, halting the trend towards an increasing gap in the early 1960s. It is likely that the gap has been slightly reduced since 1976 due to continued recovery of agricultural production and higher producer prices. However, regional income differentials in rural areas have tended to widen slightly. Within the formal urban sector there has been a dramatic narrowing of the post-tax income differential between the highest-paid government officials and minimum wage earners from 50 to 1 in 1961 to 8 to 1 in However, a large informal sector has emerged comprising large numbers of unemployed and underemployed workers with earnings significantly below the official urban minimum wage. The policies of wage restraint and higher producer prices pursued since 1975 should have a beneficial impact on almost all dimensions of income distribution, and the basic needs oriented programs in rural water and health and in universal primary education (para. 4 above) are resulting in a significant redirection in public expenditures toward the rural poor. 8. Despite this impressive overall record of development, some problems have begun to manifest themselves in recent years. Exports have failed to keep pace with the growth of the rest of the economy. The overall export index is down almost one-third since This poor performance in exports is due to the poor growth rate of agricultural cash crops. While agricultural output has increased impressively in recent years (10.9% in 1976 and 8.2% in 1977), most of this growth has been in the hard-to-measure subsistence sector, while the monetary sector has lagged well behind. Over the last decade subsistence growth has averaged 5.1% per annum while monetary sector growth

7 has been only 2.3% per annum. This has led to a severe retardation of growth of exports of agricultural products. This failure of export growth has led to increasing dependency on foreign loans and grants to pay for imports. 9. A second problem that is becoming more serious is the deceleration of the growth of domestic revenues. While still at a high ratio to GDP compared to most other developing countries, government revenues have been growing more slowly than GDP in recent years. At the same time recurrent expenditures have been higher than budgeted. As a result, public sector savings have been well below expectations and the Government has had to rely more upon borrowing (both foreign and local) and external aid for financing development than was planned. Recent Economic Developments 10. During the Government followed a program agreed to at the time of the first Program Loan (No TA) in late This program included redirecting investment to more productive sectors, higher agricultural producer prices, constraints on wages and salaries, price and tax increases to restrain consumption and tight control of imports. These policies, aided by the boom in coffee prices, succeeded in keeping government spending under control with low levels of borrowing from the banking system and led to a balance of payments surplus of almost US$150 million in Food production increased and government stocks of most foodgrains reached record levels. In 1978 the Government was able to ease import restrictions and begin to import the spares and raw materials needed by industry, which had been running below capacity. 11. Unfortunately the price of coffee, Tanzania's major export, began to fall at the same time that imports were liberalized. Also, in October, 1978 war broke out with Uganda and the resulting imports of military equipment and domestic mobilization put an increasing strain on the balance of payments and the domestic budget. Consequently the current account showed a deficit of more than US$450 million in 1978 and the overall balance of payments was almost US$300 million in deficit. As a result, reserves were drawn down and the country was forced to delay payment of about US$60 million in import bills. 12. The situation has deteriorated further in 1979 and the Government's economic policies are facing a major challenge. The overall balance of payments is expected to be almost US$200 million in deficit and as a result arrears are expected to be about US$200 million by the end of the year. At the same time the domestic budget deficit has ballooned. The recurrent budget is expected to show a deficit of almost 1 billion shillings for 1978/79 and government borrowing from the banking system is expected to be more than 3 billion shillings, a major component in an almost 35% increase in the money supply. Import licenses have been reduced by almost 40% from the 1978 level in real terms (following a 10% devaluation in January of 1979). The Government has been able to arrange for almost US$75 million in funds from the IMF from its first credit tranche, the Trust Fund and the Export Compensatory Fund, but negotiations for further assistance from the IMF have so far been unsuccessful. The 1979/80 budget calls for a reduction in the level of recurrent expenditure

8 -4- and borrowing from the banking system of 1.67 billion shillings, but through the first quarter of this fiscal year borrowing was already 1.4 billion shillings. A major problem is lack of budgetary discipline as spending agencies have been able to exceed their budgetary allocations with the Treasury continuing to honor their checks. The Government urgently needs to develop a comprehensive program to deal with the current crisis, as it did in The Bank has offered to help the Government in developing such a program. 13. Tanzania continues to attract large amounts of foreign assistance on concessional terms. Because of the very concessional terms on which aid has been given to Tanzania and the Government's reluctance in the past to use higher cost commercial loans and supplier's credits, the overall debt service ratio has historically been low (less than 10%). However, the recent balance of payments crisis has forced the Government to utilize such loans recently and as a result the debt service ratio is estimated at 12% in 1979 and 15% in We expect it will remain in the range of 15-20% throughout the 1980's. In 1978 the Bank held 12% of Tanzania's external debt (for the Bank Group, it was 28%) and received 37% of Tanzania's debt service (40% for the Bank Group). We are projecting this debt service share to fall to about 21% in 1980 and to remain around 25% for the coming decade. 14. Tanzania's development will require resources in excess of domestic savings and external capital made available solely to finance the foreign exchange costs of projects. Given the Government's efforts to mobilize domestic resources and in view of our support for its increased emphasis on local cost intensive rural investments, the Bank Group will continue to finance a high proportion of total costs including, in appropriate cases, a portion of local costs. East African Community (EAC) 15. The recent developments in the East African Community were outlined in a report to the Executive Directors dated December 19, 1977 (R77-312). Dr. Victor Umbricht, the independent mediator appointed by the Partner States, has visited East Africa on numerous occasions and has now prepared reports to the Partner States on the results of his fact-finding work on the EAC Corporations and the General Services, and the methodology adopted in appraising the assets and liabilities. The next phase of the mediator's work will be to make recommendations on the allocation of these assets and liabilities. The mediator's report and recommendations on the future structure of the East African Development Bank (EADB) have been accepted in principle by the Partner States and the revised EADB Charter along with the Treaty to enact the new Charter have been submitted to the three Governments for signature. 16. The de facto breakup of the Community has had some impact on Tanzania's budget as new national entities take over the services formerly provided by the EAC Corporations. A major development related to the EAC difficulties was the closure of the border with Kenya. Kenya was a major trading partner of Tanzania and considerable adjustments have had to be made in locating new suppliers for some items and developing alternative outlets for some manufactured goods and agricultural products.

9 - 5 - PART II - BANK GROUP OPERATIONS IN TANZANIA 1/ 17. Tanzania joined the Bank, IDA and IFC in Beginning with an IDA credit for education in 1962, 38 IDA credits and 19 Bank loans, of which two on Third Window terms, amounting to US$747.0 million have so far been approved for Tanzania. In addition, Tanzania has been a beneficiary of 10 loans totalling US$244.8 million which have been extended for the development of the common services and development bank operated regionally by Tanzania, Kenya and Uganda through their association in the East African Community. IFC investments in Tanzania, totalling US$4.7 million, were made to the Kilombero Sugar Company in 1960 and This Company encountered financial difficulties and in 1969 IFC and other investors sold their interest in the Company to the Government. A new IFC investment of US$1.7 million in soap manufacturing in Mbeya was approved by the Executive Directors on June 8, 1978 and an investment of US$1.5 million in metal product manufacturing was approved on May 10, Annex II contains summary statements of Bank loans, IDA credits and Ik'C investments to Tanzania and the East African Community organizations as of September 30, 1979 and notes on the execution of ongoing projects. 18. To support Tanzania's overall development strategy Bank Group lending operations are increasingly focusing on the rural sector and directly productive projects. While up to the end of FY 1972 Bank Group operations were directed mainly to infrastructure, the overwhelming majority of the operations approved since FY73 have been for directly productive projects. Furthermore, a number of recent Bank Group supported infrastructure projects have been closely linked with specific productive activities. For example, the Urban Water Supply Project (Loan No TA) approved in January 1976, will support the Industrial Complex in Morogoro (Loans No T-TA and 1386-TA) and the Morogoro Textile Project (Loan No TA and Credit Noe 833-TA). Directly productive projects recently approved include the Second Cashewnut Development Project (Credit No. 801-TA), the Tobacco Handling Project (Credit No. 802-TA), the Mwanza/Shinyanga Rural Development Project (Credit No. 803-TA), the Mufindi Pulp and Paper Project (Loan No TA and Credit No. 875-TA) and the Tanganyika Development Finance Company Limited (TDFL) Project (Loan No TA). In addition, a Tourism Rehabilitation Project (Credit No. 860-TA), a Sixth Education Project (Credit No. 861-TA) and a Fifth Highway Project (Credit No. 876-TA) were approved by the Board in FY79. A fourth line of credit to the Tanzania Investment Bank (Loan No TA) was also approved on July 24, Projects which have been appraised include a Second Urban Water Supply Project, a line of credit to the Tanzania Rural Development Bank (TRDB), a Pyrethrum Project, a Coconut Project, a Tea Processing Project, an Education Project and a Foodgrain Storage and Milling Project. A rural development project in Mara, a small scale industries project, an urban project, a harbours project, a railway project, and an agricultural services project are also under preparation. 1/ This section is essentially the same as that of the President's Report on the Tanzania Investment Bank (TIB) Projected dated July 12, 1979.

10 19. Although the comparatively high undisbursed proportion of loans and credits, detailed in Annex II, is in large part a result of the recent approval of many of these projects, it also reflects the fact that overall project implementation has been slower than was projected. It is clear in retrospect that both the Bank Group and Tanzania have been optimistic regarding Tanzania's absorptive capacity. The causes of the difficulties in implementation are varied. Some stem from the scarcity of suitably trained and experienced manpower, some reflect the problems in identifying agronomic input packages appropriate to the needs of smallholder farmers while others result from the strains associated with attempting a "frontal attack" on poverty. These problems have been compounded by frequent and drastic administrative changes, which -- though potentially the source of long-term benefits -- have certainly disrupted orderly execution of projects and made parts of earlier project concepts obsolete. Also, the Uganda war (para. 11) has had some impact on project implementation. In the early stages of the war, there was some diversion of equipment and manpower; however these problems have largely been solved. The problem over the medium term are the financial implications of the war. If general economic problems resulting from the war are not resolved, the availability of adequate local funds could become a major constraint to implementation. In general, difficulties have been most severe in agriculture, particularly in the smallholder rural sector. As our lending program has increasingly concentrated on this sector, these problems have become correspondingly more apparent and severe. By contrast, the "modern" sector projects have tended to fare better: the Tanzania Investment Bank, Mwanza Textile, Morogoro Industrial Estate and Cashewnut Processing Projects, for example, are proceeding well. 20. As the Bank Group's lending program has expanded, increasing attention has been given to measures designed to improve project implementation. A course was conducted in Dar es Salaam in 1973 and again in 1978 on Bank Group procurement with the relevant Government officials. A special project implementation unit was set up in the Ministry of Agriculture and 11 Agricultural Development Services staff have been assigned to Bank Group financed projects in agriculture and rural development. The need to establish a close and continuous working level dialogue between responsible Tanzanian officials and Bank Group staff on implementation problems was one of the prime reasons for the expansion of the Resident Mission to two professionals in October In February 1977 a regular Government/Bank Group review of project implementation was established. Monthly discussions on Bank Group program chaired by the Ministry of Finance and Planning (MFP) and attended by Bank Group staff and officials from implementing agencies deal in detail with individual problem projects and problems which are affecting project implementation across a number of sectors. As a result of these efforts, there has been a noticeable improvement in project implementation. Actions agreed to during the reviews have been completed relatively fast and coordination and communication between the MFP and the various ministries and agencies responsible for project implementation has improved markedly.

11 21. The Government has become increasingly conscious of the importance of effective implementation. In addition to fully supporting the project implementation review system, MFP has set up a unit to oversee project performance. Furthermore, there have been more consistent responses to Bank suggestions and a willingness to openly discuss project problems raised by Bank Staff. As a consequence, the disbursement records of Bank Group financed projects have improved somewhat over the last two years, and a recent analysis indicated that the Tanzanian disbursement performance is about equal to the Bank-wide average. While there is still a potential for further significant improvements, the Government is implementing its investment program, including Bank Group and other foreign aided projects, more effectively than in the past. PART III - THE TRANSPORT SECTOR Background 22. Tanzania, with a population of about 17 million, has a land area of about 945,000 sq km. Less than 10% of the population lives in towns, but the urban population is increasing much faster than the national population growth rate (para. 3). Poor road conditions and lack of adequate transport seriously constrain the country's economic growth, especially the marketing of agricultural products and the delivery of agricultural inputs. To facilitate rural development and to improve overall efficiency, the Government in 1972 decentralized various administrative activities, giving the country's 25 administrative regions (20 on the mainland) substantial power to control the planning and budgeting of resources in their respective jurisdictions. While the development of adequate transport services is critical to the success of the regional efforts only limited progress has been made in improving the transport infrastructure, reflecting, among other things, severe staff constraints and limited financial resources. The Transport System 23. Tanzania's transport system comprises roads (about 45,000 km), two railway systems (totalling 3,570 km of track), three main ocean ports and some minor ocean and lake ports, two international airports and over 50 smaller airfields. A pipeline conveys crude oil between Dar es Salaam and Zambia; in addition, one of the railways, and a major road, were built mainly to carry Zambian traffic. Since the collapse of the East African Community (EAC) in 1977, Tanzania has become wholly responsible for management of its transport system. 24. Highways. Of the total road network in Tanzania only 7% is paved; 93% is gravel or earth. In addition, as only about 900 km of the gravel roads have been engineered, most of the gravel or earth roads typically become impassable during the wet season. Roads classified as trunk roads (9,316 km) link the mainland's 20 regional capitals and connect Tanzania with neighboring countries; they vary in standard from two-lane paved roads to unimproved earth

12 - 8 - tracks. Roads classified as secondary roads (7,694 km) link other centers of economic activity with the trunk road network while those classified as regional and district roads (about 28,000 km) form the balance of the system. The 9,316 km trunk road system includes about 2,100 km of secondary roads and regional roads recently reclassified to trunk roads. 25. Railways. Two railway systems serve Tanzania: The Tanzania Railway Corporation (TRC) and the Tanzania-Zambia Railway Authority (TAZARA). TRC was established as a corporate entity in 1977 to operate that part of the East African Railway Corporation (EARC) located within Tanzanian territory. Although not all the issues involved in this transfer have been resolved, TRC now manages and operates the 2,600 km, 1.0 m gauge railway in central and northern Tanzania. Linking Dar es Salaam and Tanga with Arusha, Mwanza, Dodoma, Tabora and Kigoma, the TRC railway is particularly important for long-distance transport internally as well as for transit traffic to and from some of its neighbors, particularly Burundi, Rwanda and Zaire. TRC's operations and services are presently unsatisfactory because of low availability of locomotives and wagons and lack of workshop facilities, as well as the deteriorated condition of equipment and track. Large investments are required and the Canadian Government along with a number of other bilateral agencies have agreed to provide substantial financial assistance. Also, a project is being prepared for possible Bank Group financing (para. 18). 26. TAZARA, financed by the Peoples Republic of China and owned jointly by Tanzania and Zambia, commenced operations in 1976 and consists of m gauge track extending 970 km from Dar es Salaam to the Zambian border and continuing another 890 km into Zambia. The principal traffic at present is, and for some years will continue to be, Zambian exports of copper and Zambian imports. Future growth of Tanzanian traffic on the line will depend on development of the country's southern regions. TAZARA operations have experienced increasing difficulties; maintenance of locomotives, turn-around time of wagons, and coordination with the port of Dar es Salaam are presently poor. The Government is currently making efforts to improve this situation. In addition a number of bridges in Zambian territory have recently been destroyed in military actions related to the civil war in Zimbabwe-Rhodesia; these are now being repaired. 27. Ports. Dar es Salaam is Tanzania's principal sea port, Tanga and Mtwara are the other major ports. Dar es Salaam is located in a natural harbour on the East African seaboard of the Indian Ocean. In addition to handling the bulk of Tanzania's traffic, this port has traditionally handled transit traffic for the eastern part of Zaire, and the landlocked countries of Burundi and Rwanda. In recent years it has also become a major port for Zambia's seaborne imports and exports, particularly since the opening of TAZARA in Shipping. The Tanzania Coastal Shipping Line, Ltd. (TCSL), established in 1971, is a parastatal corporation with a monopoly of carrying freight and passengers between various coastal and island ports south of Dar es Salaam. Traffic between Dar es Salaam, Mtwara and Lindi is highly seasonal with heavy traffic in the rainy season when alternative road transport is unreliable, circuitous, and costly. Until an improved coastal road including

13 - 9 - a costly bridge over the Rufiji River can be built (which appears unlikely for many years), the TCSL will play an important role in transport to and from southeastern Tanzania. 29. Some transport services are also provided by TRC on Lake Victoria between Mwanza, Bukoba and Musoma ports. On Lake Tanganyika, Burundi-owned ships transport considerable cargo-between Bujumbura and Kigoma, the western terminus of TRC. 30. Air Transport. With its vast distances, difficult terrain and limited road network, domestic air service is particularly important in Tanzania. Of the more than 50 designated airfields, only a few are built to standards high enough to permit operation of jet aircraft; many of the remainder are dirt and grass strips used only occasionally. International airports are located in Dar es Salaam and Kilimanjaro; Mtwara, Tabora, Dodoma, Mwanza and Zanzibar also have paved runways. The national air transport company, Air Tanzania, was established in 1977 following termination of operations of the East African Airways Corporation to service a wide network of domestic routes. Using Fokker E-27 aircraft, Twin-Otters and two Boeing 737s, the airline provides services to major centers within the country and limited services between Tanzania and certain neighboring countries. Air Tanzania performance has improved markedly during this year. No regular air service is available between Tanzania and Kenya; all road, rail and air traffic between the two countries was suspended in February 1977 (para. 16 above). 31. Pipeline. A pipeline financed by the Italian Government and operated by the TANZAM Oil Pipeline Company was completed in 1968 from Dar es Salaam to Ndola in Zambia. Initially the 1,705 km line (900 km in Tanzania) of 20.3 cm pipe carried gasoline to Zambia, but following construction of a refinery at Ndola, the line now transports crude oil. Its design capacity exceeds 700,000 tons p.a., and traffic flow has generally been at about that level. Transport Planning and Coordination 32. The Ministry of Works (MOW) is responsible for planning major highway investments while the Ministry of Communications and Transport (MCT) oversees planning for other transport modes. The regional authorities have responsibility for planning, implementing and maintaining local roads. MFP has the principal responsibility for financing transport investments and preparing investment programs based on proposals from MOW, MCT, and the regions (after preliminary review by the Office of the Prime Minister). As transport planning capability is weak in all the ministries involved and since data for planning are not systematically collected, little meaningful transport planning has taken place in Tanzania. To begin to address this problem, Bank Group staff have been advising both MCT and MOW on preparation of a projectspecific national transport plan which would define priorities and programs for investments in the sector. Thus far, neither Ministry has been able to commit significant resources to this exercise and MCT is recommending that a National Transport Study covering all modes of transport should be undertaken by consultants with assistance from the Bank Group. This proposal is now being reviewed by the Bank.

14 Coordination of investments within the transport sector is weak, largely because of the lack of planning capability. A major cause of this problem was the dissolution of the East African Community. During its existence, air transport, ports, and a portion of the rail system operated under cooperative statutory institutions of the Community, with planning and coordination at the Community level. Since these transport elements are now operating under new agencies established by the Tanzania Government, there have been significant problems in reestablishing the necessary management and operational systems. While these problems have not led to serious misinvestments, there is a growing need to give transport investment coordination more attention in view of Tanzania's overall resource constraints and the high costs of the priority investments required in transport services. Coordination of investments among transport and non-transport sectors has also been limited. For example, in the high potential agriculture areas in southwestern Tanzania the benefits realized by Tanzania from heavy transport investments in the TANZAM corridor have been limited. The Government is now giving priority to the development of this area. Previous Bank Group Lending in Transport 34. The Bank Group has supported extensively the development of the transport sector in Tanzania. At the national level, investments have been made in highways and trucking. Highway lending includes five projects totalling $76.7 million: the first project financed construction of a total of 860 km of roads, the second project assisted in the construction of the TANZAM Highway, and the third project focused on road construction in Southern Tanzania and betterment of feeder roads. All were completed successfully. The fourth and fifth projects are still under implementation and are aimed at improving trunk road maintenance capacity throughout the country. The Trucking Project, which is also under implementation, is directed at the development of efficient trucking services through direct investment in a number of public trucking companies, training and the financing of increased spare parts inventories. In addition, a number of rural development and agricultural projects include road construction components. 35. Bank Group assistance to Tanzania for ports and railways was provided in the past within the framework of the East African Community. Loans amounting to US$166 million were made to the East African Railways and Harbours Administration and its successors the East African Railways Corporation (EARC) and East African Harbours Corporation (EAHC); these projects benefitted all three Partner States. In Tanzania, the projects have assisted the development of EARC's northern and central lines and financed a large portion of the development of Dar es Salaam Port. The specific investments in harbours include four projects: Loan 110-EA ( US$24.0 million) was made to the East African High Commission to meet part of the costs to be incurred during by the East African Railways and Harbours Administration in its development program. Among other things, this loan financed the completion of deep-water berths at Mombasa and at Dar es Salaam and a new lighterage wharf at Tanga. The project works were satisfactorily completed in Loan 428-EA ( US$38.0 million) was made to the East African Common Services

15 Authority to finance part of the foreign exchange cost of the development program of the East African Railways and Harbours Administration during This loan helped finance completion of two new deep-water berths at Mombasa and one new deep-water berth at Dar es Salaam. The project works were successfully completed in Loan 638-EA ( US$35.0 million) was made to the East African Harbours Corporation to help finance its development program, specifically the construction of two new deep-water berths and a dry bulk wharf at Mombasa, as well as the completion and/or construction of five new deep-water berths and a single buoy tanker terminal at Dar es Salaam, in addition to modernization of existing facilities at both ports. While this project was completed in 1977, both this loan and the subsequent Loan No. 865-EA were affected by the political problems which the EAC experienced throughout the seventies. Loan 865-EA ( US$26.5 million) was made to the East African Harbours Corporation to help finance its development program, specifically the construction of three deep-water berths and modernization at Dar es Salaam, the construction of back-of-port facilities and a tug berth, and modernization of other facilities at Mombasa, and improvement of lighterage facilities at Tanga. The physical implementation of this Project was satisfactorily completed in 1978 and despite some delay in construction, the final costs remained within acceptable limits. Bank Group Strategy in the Ports Subsector 36. The Bank Group's strategy in the ports subsector is to support the Government's program for its development in order to ensure that Tanzania as well as landlocked neighboring countries have an efficient outlet to the sea. The Bank Group recognizes the importance of Dar es Salaam Port in Tanzania's transport system and its vital role as a regional port serving Zambia, Zaire, Burundi and Rwanda. Bank Group involvement is intended to ensure that Dar es Salaam Port continues to keep abreast of technical trends and improves its efficiency in order to keep up with the growth of shipping, container traffic, and bulk grain shipments. To achieve this, the Bank Group is focusing on ensuring that THA's requirements for both technical assistance and the development of Tanzanian personnel will be met. While THA has employed many of the staff of the former EAHC (which had a reputation of an efficient organization in the East African context), it is a new organization which will require time to develop and grow. PART IV - THE ENGINEERING PROJECT 37. The Port of Dar es Salaam is the key link in the Tanzanian transport system and while traffic has increased rapidly over the past 4 to 5 years (particularly after Zambia closed its borders to the south), virtually no major investments have been made since the Third Harbours Project in This has not reflected a lack of planning or preparation (as noted below, the developments necessary are well studied) but rather the general difficulties that were faced by all of the EAC's Corporations in the mid seventies. The uncertainties regarding the future of the EAC made financing further

16 investments impossible. The Port of Dar es Salaam, therefore, faces a considerable backlog of high priority investment. When the organizational issues were resolved after the collapse of the EAC (para. 15) by forming a national port authority, THA, the Government of Tanzania in March 1978, approached the Bank Group for financing of the most urgent investments. Two preparation missions were mounted in 1978 and an appraisal mission visited Tanzania in April As noted below (see para. 39), and in view of the nature of the work involved, it was decided to proceed initially with an engineering credit. Negotiations of the engineering credit were held in Dar es Salaam in October 1979; the Tanzanian delegation included representatives of the Ministry of Finance and Planning, the Ministry of Communication and Transport, the Tanzania Harbours Authority, and the Attorney General's Chambers. A Credit and Project Summary is at the front of this report and a supplementary project data sheet is at Annex III. Background 38. As one element directed at ensuring the continued orderly development of the Port of Dar es Salaam, a development study (financed by the UNDP with the Bank as executing agency) was carried out in by Bertlin and Partners (UK). This resulted in a long-term master plan for port development including a detailed investment program. As a follow-up to this master plan a preliminary design effort was undertaken in to investigate further the various proposed facilities, to evaluate engineering alternatives, and to establish preliminary cost estimates for the principal components. By late 1977, it became increasingly apparent that the detailed investment program had to be updated to ensure adequate consideration of the growth in container traffic, of bulk grain handling requirements, and the increasing need for warehousing for imports. This updating, including a review of traffic projections, was initiated in October 1978 and carried out by the consultants Bertlin and Partners (UK) and was financed by the United Kingdom. It was completed in March 1979 and concluded that further development of the Port of Dar es Salaam had high priority and that facilities for handling bulk grain, container traffic, and warehousing for imports are justified and should be included; these components had not been included in the original master plan. 39. In April 1979, an appraisal mission reviewed the harbours project proposed in the updating study for financing. While the mission concluded that all the investment proposals were economically, financially and technically viable, it was not able to finalize project costs. The principal uncertainty involves dredging, which constitutes a major portion of project costs. To achieve a sufficient degree of accuracy in cost estimates in order to ensure adequate financing for the proposed Harbours Project, it was therefore considered desirable to postpone completion of the appraisal of this project until detailed designs have been completed and bids for the dredging contract have been received. Therefore, the appraisal mission recommended an engineering credit to finance the additional work required. Furthermore, as preliminary engineering is not available for either the bulk grain-handling facilities or the import warehouses, these would also be undertaken under the engineering credit.

17 Dar es Salaam Port 40. Until 1956 Dar es Salaam was a lighterage port. In that year three berths were completed; eight others have been added since then. In 1958 the petroleum jetty within the harbour was commissioned, and in 1973 the single buoy mooring facility was added outside the harbour. Traffic consists of vessels covering a spectrum from dhows and coasters to modern freighters and tankers. Presently, few specialized ships (dry bulk carriers, container ships, etc.) call at Dar es Salaam due to lack of appropriate facilities and as yet marginal traffic for these specialized carriers. However, the significant growth in worldwide specialized shipping must be reflected in considering the long term needs for developing the port. While the port was constructed as a traditional rail-served facility, trucks are playing an ever increasing role in transport to and from the port. Break bulk cargo is handled conventionally with a combination of ships! gear, quay cranes, tractors, trailers, forklifts and yard cranes. Availability of this equipment is insufficient due to inadequate maintenance. Stevedores lack adequate handling equipment and gear for use aboard ships, and there is a shortage of properly trained supervisors. The proposed Harbours Project will assist THA's development as an organization through technical assistance and training,as well as address its equipment needs for Dar es Salaam. 41. Facilities. The harbour is rather narrow with limited ship maneuvering room. The entrance channel is a natural water fairway, some 3.5 km in length dredged in 1953 to provide a minimum water depth of 7.6 m at low water. The present channel alignment contains three bends in the configuration of an "S" curve. These bends, together with the limited water depth, impose severe restrictions on ship movements in and out of the inner harbour. Ships drawing in excess of 7 m must enter and depart on the tides and arrival or departure at night is not possible with large ships. Addressing these constraints will be a major aim of the proposed Harbours Project. 42. The main cargo handling facilities are situated on the east side of the harbour, consisting of approximately 600 m of lighter wharf (minimum depth 2.4 m) and 11 general cargo alongside berths with a total length of 2,013 m. There are eight stream berths for deep sea vessels within the inner harbour for working of ships to lighters. There is a petroleum jetty in the inner harbour adjacent to and south of the general cargo berths; and a single buoy mooring terminal at Mjimwema Bay outside the harbour for large tankers. General cargo berths and their stacking areas are served by travelling portal cranes. The lighterage wharf is served by portal cranes and mobil cranes. The reorganization of the cargo handling facilities to increase the efficiency of the port will be a second major objective of the proposed Harbours Project. 43. The Port of Dar es Salaam has few facilities for handling special commodities. Molasses and edible oils are handled over one berth through embedded pipelines. Bulk grain is handled inefficiently over general cargo berths, using vacuvators discharging into hoppers from where it is trucked to either the

18 Tanzania National Milling Corporation (NMC) silo, or to the TAZARA rail depot for onward shipment. As there are no special facilities for the growing container traffic, containers are handled over all berths. While recently containers in transit have been segregated into two areas for better management, they continue to be loaded and offloaded from ships at all berths, contributing to traffic disruption as well as congestion. It is anticipated that bulk grain handling facilities and container handling facilities will be included in the proposed Harbors Project. 44. Organization, Management and Operation. The Port of Dar es Salaam was formerly one of the two principal ports (the other being Mombasa) of the East African Harbours Corporation (EAHC). Upon the collapse of the EAHC, the Tanzania Harbours Authority (THA) was created by legislation in July 1977 to establish, administer and operate a system of harbours to serve the needs of Tanzania. THA is headed by a full-time Chairman and a Board of Directors, all appointed by the President, whose duty is to "carry out the functions and manage the business and affairs of the Authority." MCT is responsible for the ''general direction and control of the Authority." The chief executive officer of the Authority, who is also a member of the Board, is the General Manager who is responsible for the day-to-day operations. The principal subordinate element of the THA is the Port of Dar es Salaam, headed by the Port Manager. The port management organization is composed of two principal elements (operations and services), each headed by an assistant manager. Under operations are included the operations manager, commercial manager, harbour master, and port engineer; under services are included managers for supplies, finance, and personnel, and a medical officer. The financial results of the ports operation are at present satisfactory. THA's tariff structure is sound and its earnings have been sufficient to cover the cost of its operations including current debt service obligations. However, with the launching of the proposed Harbours Project, it will have to meet the local currency portion of some TSh. 380 million of the proposed project costs over a period of about four years. It will be able to do so only if the current rate of internal generation of cash is increased through improved efficiency and higher tariffs. To achieve this, THA, by June 30, 1980, will review its tariff levels to determine appropriate changes which should be made in tariff levels to ensure coverage of the economic cost of its operations, including the financing of the local currency costs of its future investments. The findings and recommendations of this review will be furnished to the Association for its review and comment (Section 3.03 of the draft Project Agreement). This issue will be further addressed during processing of the proposed Harbours Project. 45. Past and Present Traffic. There has been a steady growth in the traffic of Dar es Salaam Port, even though it is subject to fluctuations due to changing economic conditions in the countries which it serves, 1/ political conditions in the region, and disruptions or deterioration in the regional land transport systems - rail and highway. 1/ Tanzania, Zambia, Burundi, Rwanda, Zaire, and to some extent, Uganda.

19 Dar es Salaam Port Traffic (Thousand Tons) General Cargo Exports ,049 Imports ,034 1,190 1,378 Oil Total 1,386 1,617 2,021 2,145 2,427 Exports 249 1/ 196 1/ 249 1/ 217 1/ 114 2/ Imports 1,698 1,772 1,818 1,892 1,736 Total 1,947 1,968 2,067 2,109 1,850 1/ Including bunkering. 2/ Not including bunkering. Description of the Engineering Credit and a Proposed Harbours Project 46. Because of the substantial uncertainties surrounding the cost estimates for the civil works involved in the proposed Harbours Project, a two-phased approach to financing is proposed. The first phase would involve an engineering credit to cover detailed engineering design and preparation of tender documents for the anticipated port investment including a feasibility study of the location of a bulk grain silo. The civil works for which detailed design and preparation of tender documents is proposed include: straightening and deepening the entrance channel; a container facility; a petroleum jetty; a tug berth; a grain silo with ship unloader, conveyor system and elevator; and an import storage warehouse. This would require topographic and hydrographic surveys; sub-surface exploration (drilling); civil, electrical, and mechanical engineering; architectural services; drafting; and support costs for the effort (transportation, accommodations, subsistence, printing, communications, overhead, etc.). An estimated 300 man-months of engineering effort, at a man-month cost of about US$6,500 (including the man-month rate, international travel and subsistence) will be required. 47. The second phase would cover the financing of the proposed Harbours Project. This would consist of the items for which design work is proposed as well as technical assistance and training components and equipment for the Port of Dar es Salaam. As noted above (para 37), an initial appraisal mission visited Tanzania in April 1979; a post appraisal mission would be expected to finalize an investment proposal after the engineering services have been completed. However, in order to confirm that the estimated civil

20 works costs are accurate, it is expected that the bids for that item will be received before presentation of the proposed Harbours Project to the Executive Directors. It is not anticipated that any contract will be signed prior to consideration of the proposed Harbours Project by the Executive Directors. 48. It is proposed that the engineering credit would be refinanced under any subsequent credit or loan provided by the Bank Group for the proposed Harbours Project. While other alternatives for financing the engineering credit were considered, they were rejected because the prospective funds were inadequate to meet the cost of the engineering services and would have unduly delayed their completion. Implementation of the Engineering Credit 49. Detailed engineering and preparation of tender documents will be undertaken by Bertlin and Partners (UK) (para. 38), the consultants selected by the Tanzania Harbours Authority (THA) and accepted by the Association (Section 2.02(a) of the draft Project Agreement). Copies of documents prepared by the consultants for the project, including reports, drafts, plans, designs, specifications, work schedules and estimates of costs will be furnished to the Association (Section 2.02(c) of the draft Project Agreement). THA will execute the contract for these services by assigning principal responsibility to its Director of Engineering and Technical Services. The personnel of this Directorate have the capability to supervise the execution of a design contract. Terms of reference for the design contract were developed jointly by the Association staff and THA staff. Upon completion of the engineering services, the Government and THA would consult with the Association on the recommendations and conclusions relating to the project (Section 3.01(d) of the draft Development Credit Agreement and Section 2.02(d)(ii) of the draft Project Agreement). Project Costs, Financing and Disbursement 50. The estimated total cost of the engineering services is US$3.0 million net of taxes and duties. 1/ This cost estimate includes an adequate margin for contingencies (22%) and is based on a recent quotation. The foreign exchange component would amount to US$2.5 million equivalent or 83% of total costs. Details of project costs are included in the credit and project summary. The proposed engineering credit of US$2.5 million would be repayable over 10 years, including 2 years of grace and carrying a service charge of 3/4 of 1% per annum (Sections 2.05 and 2.07 of the draft Development Credit Agreement). The proceeds of the credit would be onlent by the Government to THA under a Subsidiary Loan Agreement on terms and conditions acceptable to the Association; this would include an interest rate of 7.95% per annum, repayment in 10 years including 2 years of grace and the foreign exchange risk borne by THA (Section 3.01(b) of the draft Development Credit Agreement). The proposed engineering credit would finance the entire foreign exchange cost and THA would finance the local costs amounting to US$.5 million equivalent 1/ The project is exempted from identifiable taxes and duties.

21 (Section 2.01 of the draft Project Agreement). The proposed engineering credit would be disbursed over a period of 20 months against 100% of the foreign cost of the consultant's services. All withdrawal claims would be fully documented. Reporting and Accounting 51. THA will maintain records adequate to record the progress of the engineering credit and to reflect project expenditures; the Association will be able to inspect all relevant records and documents (Section 2.04 of the draft Project Agreement). THA would have its accounts audited each fiscal year by independent auditors acceptable to the Association. Within six months of the end of each fiscal year it would furnish its audited financial statements to the Association (Section 3.02 of draft Project Agreement). Justification and Risks 52. The risk involved in the proposed engineering project is minimal as the same consultants who carried out the long-term development and updating studies of the Port of Dar es Salaam have been selected for the engineering services (paras 38 and 49); the consultants' previous work has been satisfactory. No major delay in the implementation of the project is therefore anticipated. The proposed Harbours Project, for which the engineering credit is a necessary prior action, will be a major step towards the development and the modernization of the Port of Dar es Salaam. Its objective will be to improve the ports productivity, management efficiency, capability to handle bulk grains and containers, and facilitate the entrance to and departure from the harbour by ships. The project does not include any expansion in physical facilities for handling break-bulk cargo as such, although it will contribute greatly to the effective capacity for handling general cargo. The improvement in efficiency of the port will relieve congestion and improve throughput, as well as introduce modern techniques for grain and container handling. A portion of the cargo handling equipment fleet will be replaced as it becomes worn out. Improvements in equipment maintenance will be introduced; waste removal will be facilitated; and a capability for continuing maintenance of the paved surfaces of the port area will be provided. Technical assistance in critical areas of port operations and management will be provided, as well as assistance in training of personnel in critical skills, both at the port's training center, and through offshore training. 53. The major risks involved in the proposed Harbours Project for which engineering design is to be undertaken are two fold: (i) traffic forecasts; and (ii) capacity of the regional transport system to serve the Port of Dar es Salaam. The principal uncertainty relates to Zambian traffic. Zambia, a landlocked country, has traditionally been served by numerous routes through Zaire/Angola, Mozambique, Rhodesia, and South Africa, as well as Tanzania. In recent years the availability of all these routes, except that through Tanzania, have been interrupted or denied completely due to political turmoil in the region. Future availability of these alternative routes is currently uncertain and is expected to remain so. It is clear that access to the sea via Tanzania is the most economical and responsive one for Zambia.

22 The second uncertainty relates to the transport links between the Port of Dar es Salaam and the interior. The links to Zambia are the TANZAM highway and TAZARA. In expectation that TAZARA would carry the bulk of Zambia's traffic, the trucking services (mainly through ZTRS), were allowed to deteriorate; however, TAZARA's performance has fallen short of expectations (low locomotive availability, poor wagon turnaround, and recently land slides and damaged bridges). To deal with this, trucking services are now being restored, and the international community is beginning to assist TAZARA to deal with its difficulties. On a somewhat lesser scale, but of great importance to the countries concerned, are the serious difficulties of the TRC in efficiently linking the Port with a large area of Tanzania, and with the landlocked region comprising Burundi, Rwanda, Uganda and eastern Zaire. Substantial investment aid, notably from the Canadian Government, is already committed for the Railway, and a project is being prepared for possible Bank Group financing. It is expected that these will provide significant input into the rehabilitation of this railway. 55. It is evident that the Port of Dar es Salaam cannot be considered in isolation, but only as one link in a regional transport system. Consequently, careful consideration has been given to the foregoing uncertainties in relation to improvement of the port. With all factors taken into account, the proposed Harbours Project is justified and has high priority. This judgment is based on the assumption that Zambia will continue to use Dar es Salaam as its principal outlet to the sea, and that the transport links connecting Dar es Salaam to Zambia, Burundi, Rwanda and eastern Zaire will be restored to an acceptable level of efficiency. PART V - LEGAL INSTRUMENTS AND AUTHORITY 56. The draft Development Credit Agreement between the United Republic of Tanzania and the Association, the draft Project Agreement between the Association and the Tanzania Harbours Authority, and the Recommendation of the Committee provided for in Article V, Section 1(d), of the Articles of Agreement of the Association are being distributed to the Executive Directors separately. 57. Features of the draft Development Credit and Project Agreements of special interest are referred to in the text and listed in Section III of Annex III to this report. Execution of a subsidiary loan agreement satisfactory to the Association, between the Government and THA would be a condition of effectiveness (Section 5.01 of the draft Development Credit Agreement). 58. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association.

23 PART VI - RECOMMENDATION 59. I recommend that the Executive Directors approve the proposed credit. Robert S. McNamara President Attachments Washington, D.C. December 5, 1979

24 TABLE 3A L i TANZANIA - SOCIAL IVDICATORS DATA SHEET LEFEJLNCE GROUPS (ADJUSTED A;RACES LAND AREA (THOUSAZD SO. -- (OST REC17 ESTIMATE) -- TOTAL SAME UHLE NEXT, hignia ACRICULTUPAL MOST RECENT CEOCIAPHIC INCOME INCOrz 1960 Lk 1970 Lb ESTI.MATE b LZGION Le CGOUP / GROUP la CN? PER CAPITA (USS) LIIERCT CONSUMfl!04?ER CAPITA (KILOGRAMS OF COAL EQUIVA'T) POPUtATION ANI! VITAL STATISTICS POPULATION, SlD-MLAR (MILLIOS) URBAN POPULATION OF5LC OP TOTAL) POPULATION PROJECTIONS POPULATION IN TYAR 20CO (MILLIONS) 32.0 STATIONALY POPULATION (MILLIONS) 94.0 TZAR STATIONARY POPUJLTION IS RACHED 2145 POPULATION DENSITY PER SQ. EN tp Sq. KM. AGRICULTUI.L LAND POPULATION AGE STRUCTOUR (PERCDET) 0-14 YRS TRS t ns. AND ABOVE POPULATION GROVE RATE CPECEIT) TOTAL URBAN CRUDE BIRTU RATE (PtR TiOUSAN) CRLUDE DEATH IATE (PE TAOUSAND) GROSS teproduction LATE FAMILY PLANNING ACCEPTORS. ANINUAL (TROUSANS) USERS (PERCENT OF iaaxced NO ) FOOD AND NUTRITION INDEX OF FOOD PROOUCTIO4 PEI CAPITA ( ) PER CAPITA SUPPLY OF CALORILS (PERCENT or UEQUILEXLNTS) PRTtINS (CLAMS PE DOY) Or WssCH A:lMALAIM PULSE 22.0h CHILD (ACGS 1-4) MO.RAIITY LATH HEALSE LIFE EXPECTANCT AT AMR (TELS) INFANT MORTALITY RATE PuR TROUSAND).. 55.OL& ACCESS TO SAFE NAT7 0 CICSNT Of POPULATION) TOTAL UWAN IRDAL ACClSS TO 1ZRZEA DISPCSAL (?ZCENT Dr POPULTION) TOTAL gum.... U RURAL POPULATION PU PSYSICIAN OLL /t POPULATION PER urslnc PQSON *300.0oj O L522.1 POPULATION PQ bospital ED TOTAL 57S.0& 6S aurba n. ROAL &AMlISSIONS PU UDSPITALSI HOUSING AV*AGE SI2C or 8oUs5COL TOTAL ALL R &RVAL.. 4.5/j ACCGH NIfl of PERSONS PF OM TOTAL UR.A RURAL &CCCSS TO CLICTUCITY (PUlCUT OF DWELLI4CS) TOTAL n.3 MI.1 OKBA" RURL

25 TABLE 3A] TANZANIA - SOCIAL tydtcai0xs DATA SWEET S PTJ.ZUNC ClROUPS (AZhUSJtED AX AE U RAW.AXIA - R!C utos1 s -SS.-tt ) -- S0.I SAil Nt I H.E, IIC55 SZC.NT CIOGCRIIC 1NC0.X rycomt 1960 lb 1970./b ESTIMATE /b ttc1o0 /c 'GROV? /d CG)UP tducation AJUS teo EOLL<ttNT RATIOS PRIMIAY1 TOTAL MALi FaIALt SECONDARY: SOTAL ' MALU FE-LA * VOCATIONAL ENROL. (2 0F StCOhtDAI) PUPIL-TtACHER IlATIO PRI MA I 45.0 ' >.1 5ECONDARY AWLT LTS RACY LArt (PUCIET) 9.5/I 28.1Ls CON5Li?:ON PASSENGER CARS Pn ThOUSAND POPVLATION RADIO LtCE VIES PE* TOOUSAJ POPULATION TV lleceivers t R THOUSAht POPL'LATIOt nispaper (C-AnY CD.IRAL tmilest-) CDRCULATION PU THOUSAND POPULATION ' C71C:lA ANUAL ATTENDANCE PER CAPITA LABOR FORCE SOTAL LASOR FORCE (THOUSA)DS) ?DIALZ (PERCENT) ACICLLTUR.E (PECrYIT) INDUSTRY (PERCE.NS) 3.J PARTICIPATION RATE (PUCERCS) TOTAL HAUL *8.8 VDIALE I.S U CONOfMIC D(PEIDEYCY latio INCOME oismtion PERCEN OF PRWVJAE INCOM IZCEIVED SY RIC.HIST 5 PERCENT OF HOUSEROLDS IlCHEST 20 PRCE.NT 0 IIOUSEHOLDS LO6TSS 20 P RCENT OF ROOSEROLDS LOVEST 40 PIECLES OF WOUSEWOLDS P?RTY TARGET CROUPS ESTIMATED ABSOLLME POVElTY UICCIZ LUVEL (USS PER CA.PTA) CURAN " RURAL ZSTtASTO RELATIVE POYESM IICO#Z level (US* PuE CAPITA) ua ! RURAL * " ESTIMATED P?P?LATIOtt 5?LOV AISOLUJT POVERTY LNCOM UVI;L (PERCENT) U1R.... U tuial U Not avallable.oc applicable. * wits The adjusced group averages for eacb indlcator are populactoo-vight.d geomecrtrc Sean, eacludiag the extreme values of the indicetor and the est populated country In ech gcoup. Coverage of eounctries &on the tedicator, depends oan veilablitt of daca and is soc unilorm. /,j Unless othcrf.. aoced, data for 1960 rtofr to any year between 1959 enid 161; for 170. between 1969 md 1971; and for Most Recent Etimate. between 1974 and e Atrtic South of Sahara; /d Low Incose (S280 or lose per capita. 1976); /0 Lotr 1U%dl. Laceoe ( por capita, /f aimnl&ad Tansania; L 1987; /h ; /1 1942; U Rgitstcred. net *11 practice in the country. Most Secant Lttiaets et CSIP per tapits to for Augst. 1979

26 DWINITIONB OF SOCIAL INICATORS Notes: Although the data are drawn fro a sures generally Judged the most authoritative sod reliable, it should also be acted that they asy not be internstionally comparable because of the lack of standardized definitions and concepts used by different countries in collecting the data. The data are, nonetheless, useful to describe orders of magnitude, indicate trends, and charaterize certain najor differences between countries. The adjusted group averagses for each indicator are population-weighted geometric means, excluding the extreme, values of the indicator and the mast populated country in each group. Due to lack of data, group averages of all jedicators for Capital Surplus 011 Exporters and of indicators of Access to Water and Excrete Disposal, Housing, Ioons Distribution and Poverty for other country groups are population-weighted geometric meso without exclusion of the extrem values and the most Populated coutry. Since the coverage of coutries among the indicators depends on availabilityo ata ad is not uniform, caution oust be exercised In relatingtavetrages of one indicator to anothr. These avenages are mostly useful as approximation of execed" values when coppalin the vaue of one idcator ataim a-n the coutry and referene groups. IARD AREA (thousand sq.km.) Access to EKoreta Dispsa (eentfpplto)-ttl urban, and rual- Total - Total surface area comprising land area. and inland waters. Nubrof peol (tota, uba,and rrl evdb xrt ipsla Agricultural - Most recent estimate of agricultural area used temporarily perc entages of their respective populations. Excreta, disposal may include or permanently for crops, pastures, market and kitchen gardens or to the collection and disposal, with or without treatment, of human emrrts. lie fallow. and wants-water by water-borne systems or the use of pit privies and -oilar GRP PERCAPITA (USS) - GNtP per capita estimates at cur,rent market prices,) Popujgdjipgpe installations. ~ician - Population divided by number of Practicing physicians caclted by sans conversion method an World Bank Atlas ( basis)uife ; jiltii6 hd1ca.l school at university level. 1960, 19,70, and 1978 data. Population per Nurs ing Person - Population divided by number of practicing male ENfERGY CONSUR(TION PER CAPITA - Annual consumption of cormercial energy and female graduate nuses, Practical nurses, and assistant nures.. (coal an Ige-Poultio.n int,ptoem aua d a o yr- ula perhoapital Bed - total, urban, and rural - Popuiation (total, urban, thermal electricit)in kilogroams of coal equivalent per capita; 1960 adraldiided by their respective number of hospital beds available in 1970, and 1976 data, public and Private general and specialized hostpital and rehabilitation centers. Hospitals are establishments permanently staffed by at leant one Physician. POPUIATIOR AND VITAL STATISTICS Establishments providing principally custodial care are not Included. Rural Total Population, kid-yearnbilliona) - As of JUly 1; 1960, 1970, and hospitals, however, inclode health and medical centers sot Permsnently staffed 1977 data. by aphysician (but by a medical assistant, nurse, midwife, etc.) which offer Urban Ppltion (percent of total) - Ratio of urban to total population; in-patient accommodation and provide a limited range of medical facilities. differntdefisitioss of urban-areasmay affect comparability of data Admissins per Hospital Bed - Total number cf admi..i.s to or discharges from among conries; 1960, 1970, and 1975 data, hositals divided by thnubrobe. Popltio Projctions Population is year Current Population projections ore based on HOUISIRG 1975 total population by age and en and thsir mortality and fertility Average Size of Hosholfd (perszonsper household) - total, urban, and rura - rates. Projection pareameters for mortality rates comprise of three A household consist fa ru of Individuals who share living quarters and levels ass uming life expectancy at birth increasing with country's their main mals.a boarder or lodger say or may not be included in the per capita income lee,ad female life expectancy stabilizing at household for saitical purposes years. The Parameters for fertility rate also have three levels Average number of person per room - ttal, urban and rural - Average comber assuming declise is fertility according to incme, level and pant of persona par room inal rban and rural occupied conentional dwellings, fesally planing Performance. Each coutry is them assigned one of these respectively. Dwellings exclude non-permanent structures and unoccpied parts. nine combinations of mortality and fertility trends for projection Access to Electricity (percnt of dellings) total, urban an.rra - Conprpoe.ventional dwellings wt lcrct nlvn uresa percentage of Stationrypopulation - In a stationary population there is no growth total, uran, and rural dwellings respectively. since the birth rate Is equal to the death rate, and also the age structure reunions constant. Thin is achieved only after fertility rates EDLEATION declin to the replacement level of unit net reproduction rate, when -Adj-usted Horollas,t Ratios each geeaion of woe replaces Itself exactly. The stationary popu- Primary school - total, male and female - Gross total, male and female enrolllain -sz a estimated us the basis of the projected characteristics eto.l ages at the primary level as percentages of respective Primary of ths population in the year 2000, and the rate of decline of fertility school-age populations; normally includes children aged 6-11 years, but rate tor relcmn ee.adjusted for different lengths of Primary education; for coutries with Tearotatosar poplationis reached - The yea. when stationary Population universa education enrollment may exceed 100 percent since som pupils n!ticeoha bees reached. are below or shove the official school age. Popultio Density Secoodaryschooli-etotal maead female - Computed as abcs.; --codary Per so. km. - M4id-year population per square, kilometer ClOG hectares) of edctoreuesat l:eas or years of approved primary iatruction; total area provides general vocational, or teacher training instrutioso for pupi1s Per so. ho. agicultural land - Computed as above for agricultural land usually of 12 to 17 ye"ar of age; correspondence courses are g.nserlly only. ~~~~~~~~~~~~~~~~~~excluded. Popuation Age Struture(percent) - Children (0-lb years), working-age Vocational erlment (percen of eondary) - Vocational institutiono include C 15-b4 yeas) and etird7 (6 years and over) as peroentages of mid-year technlcal *inusril,. ore ohr programs which operate independently or an population;. 1960, 17,and 0197 data. departumnts of cecondary institutions. Population Growth Rate (percen.t) - total - Annual growth rates of total mid- Pupil-teacher rati - prmr,ad secondar - Total students enrolled in year Populations for , an 90f.primary and secodr aevels divided by numbers of teachers is the coe-c Population Growth Rat.pe~rcent) - urban - Annual growth rates of urban sponding levels. populatio,nsafor 1_950-, , and Adult literacy rate.iercenat) - Literate adults Cable to rend and wits) as CueRrtb Bae_erthousad) - Annual. live birth. per thousand of mid- percentage of tt aut population aged 15 years and over. year, population; 1, 90,ad 1977 data. Crude Death Hate e tosn)- Annual deaths per thouand of mid-year CONSUI4PTICS populatti..;1960' 19707iiCd 1977 data. Passenger Cur (per thosad poatina) Pansenger cars comprise motcr ones Gross Reproduction Rate-Acerage sober of daughters a woman will bear seating less than sihth person; ecldes ambulances, heresad military in her normal reproducti ve Period if sh.excperiences Present age- vehicles. specific fertility rates; usually five-year averages ending In 1960, Radio Receivers (per thuad popuain -All types of receivers for radic 19701, an-d brodcasts to generalpubif a thousand of population; eccludes unlicensed FiiyPannin AccePtors An l(thousands) - Anneal number of receivers In countries and in years, when registration of radio sets.anin acceptors of birth-coto eie under auspices of national family effect; data for recent ye-ar msy not be comparable since m-t coun trie Planning program. abolished licensing. Family Planning - Users (percent of marriedwmen) Percentage of married TV Receivers(era thousanddtpoultion) - TV receivers for broadcast to general women of child-hearing age 1~Ayas h use birth-control devices publipethuadpouainexludes unlicensed TV receivers in countries to all married woe in sane age group. sod in years when registration of TV sets was in effect. F2~~~~D NUr: TION 11-12tV~~~~~~ewpayr irculation (per ihomuand population) - Shows the nverage FOGS ASP circulation NUTRITIOR - ~~~~~~~ofdal gnerall.iterest newspaper", defined as, a periodical publicatioc Inexo Fo P-cues per Capita (199-71=100) - Indes of Per capita devoted Primarily to recording general sews. It is considered to be "dail'y" annual productica of all fond commdities. Product Ion excludes sed and if It appears at leant four times a week. feed and is on calendar year basis. CoomoodIties cover primary goods Cinema, Annual Attendance percpt c er-bsdo h ubro ikt ( e.g. sugaran instead of sugar) which are edible and cotain nutrients soddrn h er necludingamision to Bdrive-in numem r and mobilet (eg "cfeead tea are excluded). Aggregate production of each country -nita. is based on national average producer price nights. Per capita oupply of calories (perent of requirements) - Computed from LABOR FORCE energy equivalent of net fond supplies available in country per capita To-t-al Labcr Force (thousands) - &.onmically active persons, including armd pcr day. Available supplies comprise domestic production, Imports less fcr"s and unemployed but excluding houewives, students, etc. Defisitlons exports, and changes in stock. Ret supplies exclude animal feed, seeds, is various count ries are not conparble. quantities used is food processing, and loss.es in distribution. Require- Feal (pcent)c- Female labor force as Percentage of tctal labor force. nects were estimated by FAG based on Physiological needs for normal 192Mlture acnt) - labor fore in farming, forestry, hunting and act ivity and health considering ecvirconmental temperature, body weights, fishing as perentage of total labor force. age and sec distributions of population, and allowing 10 percent for Indust y(.percent) - Labor fcrce is mining, construction, manfacturing and wsate ahoshold level.z 5iiy water and gas as percentage of total labor force. Per capita suppl of protein (grams per day) - Protein content of per PripaonBt(ecnt) - totl al and feae- PartIcipatio.n or capita net supply of food per day. Ret oupply of food is defined as ativ ty ratesaecmue mttl ae adfml ao oc spr shove. Requirement for all coutries established by USSi provide for a cantages of total, male and female population of all ages respectively; minim allowancet of 6o gram of totalprotein per day and 20 gramma of , and 1975 data. These are ILO's participation rates reflecting animal and pulse protein, of which 10 grams, should be animal protein, age-sex structure of the population, and long time trend. A fe estimates These standards are lower than those of 75 greamse of total prote in and are from national soure.s. 23 gram of animal Protein as an average for the world, proposed by FAG Economic Deedec Raio - Ratio of Population under 15 and 65 and over to in tie Third World Food Survey. telbrfcein age group of year.. Per capita proteinspl fom anmaad pulse - Protein supply of food derive frmaiml n plses in grams, par day. loedniltq Child Cages 1-4) NrauyRte (per thousand) - Annual. deaths per thousand Percentage of Priva.te Incom (botphin cash and kind) - Received by richest In age group 1-4 years, to childres In this age group; for most devel- 5 percent, riches 20pret, porest 20 Percent, an poorest ho percent opiug coutries data derived from life tables, of households. HEALTH POVERTY TARGET GROUPS Life Expectancy at Sirth -(yars - Avelrage nhr of years of life Estimated Absolu.te Poverty Incom Level CUS$ per capibta)' -uba ad rural reaiin at birth n 977. data Absolute poverty income leve is that Income leve blwbih a minimal Scfat itiaity Rate (per ithusad) -Annual deaths of infants under one nutritionally adequate diet plus essential non-food requirements is not year of age per thousand live births, affordable. Accen. to Safe Water (percentof ltis - ~total,turban and rura - Estimated Relative Poverty noelvlcs per capita) - urban and rural- Rumbr o peple(total uban, sdrura wih resnbeaccess to Rural relative poverty incme ee isoe-third of average per capita safe cater supply (includes treated suface waters or untreated but personal income of the country. Urban level Is derived from the rural level uncontaminated ester ouch as that from protected boreholes, springs, with adjustment for higher cost of living in urban area. and sanitary wells) as percentages of their respective Populations. In Estimated P,poltion Below Absolute PovertyIcm ee?ret ra and anurban ware a public fountain or standpost located not mere than rua Pret a o uaio ubnad rural who ae absolute pr 200 meters from a house nay be considered asbinzihi esoal access of that house. In rural areas reasonable naccess would imply that the housec ife or members of the hcusehold do not have to spend a Ecos-mic and Social Data DivIi.on diaroportionate part of the day is fetohing the family's water seeds coo-mic Analysis sod PrJecti.s. Department August 1979 Pg

27 -23 - I TAPZ7AN Ietosil lpi910_t Oat. 5t-t Act-el 7!1 Prola tud Arae Ar. Groeth Rat.? H7-85 Share of i -I-~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ,, 19"N" A NATIONAL ACCOUTS (MIlli.on US $ t 1977 Ptir-a) I GOD I Gains fro- Ta of Trade (7T) Grta... ntm ' lvort ' faorta - olm a Rporta - 7T ad ated 7 ptsoora GA -f7t adjoated Total CooaoapAiaon lotearnt Hatetome Ninloe Oat Glcaf.ntoga MOP torrent US t B. SE8TOR UU7TUT (Share of Gop *A 1977 fti.ea) 1. Iedoatry tircltora SamItem C. PRICES 1. NApoet frt-e I148a Iwort Prtta Irdoaa o.ay of Trade MP? D.flator (US S) Aneraa d tch-ge. fate (TSb/USS) D. IE3 I9DICA70RS I1OR bwort Elaatl-lay Aneroja t.4ial Sanlna Rate 4. tnaraa tetlotal Ganln8e Gte grgltal -altale Sant R tae IlI-rt/GOP neat tt/gip tao.ra G p/cgy E EllPLOYKElt 1. Labor Torte (alilloo) 2. E Aloyaat (7 here) AOrltoltre ladnatry Somltee / rn.. Pt_e. F. PUBLIC FIN60Cr Attoel Attoal Eat. (MIllIto TShillitga) 1965/ / / / / / / /79 1. Qorroo3t tvenete Tao teteo o "rrett tpet-dltare Ieral Adtia-tretlot Ge 3 -oret SanRga oretet GretA Surploc Aallable for Fi-itnrlt Genelopeect xfpetdltore Detelopoatt GRpendtt-re A. 7. noerll fftlrlt _ a Flnanrltd of tte naclalt Ixterral toera Dat1"tl BtrroeIn8a long-tar-" Short-ten / It 1966 priee and 1977 indet ba. year. oeao2 2/ Conttee Qcnarnuent

28 o a. 92C llq ~5 R L.'oOo e 99it r w9.00_ s ta>g t ~~~10 S. 0 n ^ iofl>i g B >~.aas -n o t BBfl0Ol c00.~ l" "*n,z 0'i'.r n~~~~ ~ ~ e. S11 n00'- 00. n OB.,-.' Cn li t 0r l =,, B & B " " n co- _ e ee 001e -= n 0_. e n * 00 0 ^ B > d o n 0000*rI X o n g r10 2o n0g0n V z z < B " gf = B g01n r.0n.n OtO 2 eto -. ; - ' e0 6 : r n o -r _ 0 0,.0 0.t0 -I.000 OlBo0 IIb *0 2 ~~~~~~~~~~~~o to O0. O0 00 C1C... 1 J 0O e 3 -so _o - ' ;, - I. 1to C 00B Io - ~ "~ I e Ig tol 0 S.o 000 > to C0 ci o c Io t B ~ to X 0q 1to WOb Q ~~~~~~~.000'~ ~~ ~~~~ 0 0' ~ ~ 0-o-.Oooso o Iw. I lito '~ 0' Is -> ' o c o 000 n= a~~~~~~~~ -.0~ -ct I.0 0;o 1 _ cf ' F Ft to FIo u to 0 I t'r.0f ' o ttr0 I 00 t t4~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ l1

29 -25- Annex 1 Page 6 TANZANIA Debt- /and Creditworthiness Actual Preliminary A. Medium and Long-term Debt (Disbursed Only) (US $ Million) 1. Total Debt Outstanding (DOD: End of Period) Including Undisbursed Public Debt Service Interest Other M & LT Debt Service B. Debt Burden 1. Debt Service Ratio Debt Service/GDP Public Debt Service/Government Revenue C. Terms 1. Interest on Total DOD/Total DOD Total Debt Service/Totai DOD D. Dependency Ratios for M & LT Debt 1. Gross Disbursements/Imports (incl. NFS) Net Transfer/Imports (incl. NFS) , Net Transfer/Gross Disbursements E. Exposure 1. IBRD Disbursements/Gross Total Disbursements Pank Group Disbursements/Gross Total Disbursements IBRD DOD/Total DOD Bank Group DOD/Total DOD IBRD Debt Service/Total Debt Service Bank Group Debt Service/Total Debt Service ,5 F. External Debt (Disbursed Only) Outstanding December Amount Percent (US $ Million) IBR Bank Group Other Multilateral Governments of which Centrally Planned Economies Suppliers Financial Institutions Bonds Public Debt, n.e.i Total Public M & LT Debt-/ 1/ Total Public Debt (incl. undisbursed) G. Debt Profile 1. Total Debt Service /Total D0D End of 1978 InoDA 1/ Inlude of 4% Tanania' ofeac ebt.november notonalshar 26, 1979

30 ANNEX II Page 1 of 17 THE STATUS OF BANK GROUP OPERATIONS IN TANZANIA A. STATEMENT OF BANK LOANS AND IDA CREDITS TO TANZANIA AS OF SEPTEMBER 30, 1979 (US$ million) Amount less cancellation No. Year Borrower Purpose Bank 1/ TW IDA 1/ Undisbursed Five loans and thirteen credits fully disbursed TA 1972 Tanzania Smallholder Tea TA 1973 Tanzania Fourth Education TA 2/ 1973 Tanzania Livestock TA 1974 Tanzania Cotton TA 1974' Tanzania Tanzania Investment Bank TA 1974 Tanzania Cashewnut TA 1974 Tanzania Sites and Services TA 1974 Tanzania Highway Maintenance TA 1974 Tanzania Rural Development (Kigoma) TA 1974 Tanzania Sugar TA 1975 Tanzania Dairy TA 1975 Tanzania Textile TA 1975 TIB Tanzania Investment Bank TA 1976 Tanzania Technical Assistance TA 1976 Tanzania National Maize Program TA 1976 Tanzania Fifth Education T-TA 1976 Tanzania Power TA 1976 Tanzania Forestry TA 1976 Tanzania Fisheries TA 1976 Tanzania Tobacco Processing TA 1977 Tanzania Urban Water Supply T-TA 1977 Tanzania Morogoro Industrial Complex TA 1977 Tanzania Morogoro Industrial Complex TA 3/ 1977 Tanzania Rural Development (Tabora) TA 1977 Tanzania Second Sites and Services TA 1977 Tanzania Trucking TA 1977 TIB Tanzania Investment Bank TA 1978 Tanzania Second Cashewnut TA 1978 Tanzania Tobacco Handling TA 1978 Tanzania Rural Dev. (Mwanza/Shinyanga) TA 1978 Tanzania Morogoro Textile TA 1978 Tanzania Morogoro Textile TA 1979 Tanzania Tourism Rehabilitation TA 1979 Tanzania Sixth Education TA 4/ 1979 Tanzania Mufindi Pulp and Paper TA 4/ 1979 Tanzania Mufindi Pulp and Paper TA 4/ 1979 Tanzania Fifth Highway TA 6/ 1979 TDFL Tanganyika Development Finance Co., Ltd / TA 4/ 1979 TIB Tanzania Investment Bank 25.G Total of which has been repaid Total now outstanding Amount sold 0.1 of which has been repaid 0.1 Total now held by Bank and IDA 1/ Total undisbursed / Net of exchange adjustments. 2/ Includes Norwegian participation of $6.2 million of which $5.6 million has been disbursed. 3/ Amount excludes Canadian participation of $4.8 million. 4/ Not yet effective. 5/ Excludes $15.0 million EEC Special Action Credit being administered by IDA. 6/ Declared effective November 1, 1979.

31 ANNEX II Page 2 of 17 B. SUMMARY STATEMENT OF BANK LOANS FOR COMMON SERVICES GUARANTEED BY KENYA, TANZANIA AND UGANDA AS OF SEPTEMBER 30, 1979 (US$ million) Loan Amount (less cancellations) No. Year Borrower Purpose Bank 1/ Undisbursed Five loans fully disbursed EA 1969 EAHC Harbours EA 1970 EARC Railways EA 1972 EAHC Harbours EA 1973 EAPTC Telecommunications EA 1976 EADB Development Finance Total of which has been repaid 52.8 Total now outstanding Amount sold 24.4 of which has been repaid Total now held by Bank 1/ Total undisbursed / Net of exchange adjustments.

32 ANNEX II Page 3 of 17 C. PROJECTS IN EXECUTION I/ (AS OF SEPTEMBER 30, 1979) AGRICULTURAL SECTOR There are currently 36 projects under execution in Tanzania. Credit No. 287-TA - Smallholder Tea Project: US$10.8 million Credit of March 3, 1972; Date of Effectiveness - July 26, 1972; Closing Date - December 31, 1979 After initial serious management problems, the Tanzania Tea Authority (TTA) has finally reached a satisfactory level of senior staffing and this has had a clear impact on the working of TTA and resulted in improved control over field activities. Factory engineers have been appointed for all factories. Because of weak extension and poor farm practices in the past, about 1,600 ha of the 9,671 ha planted since 1971 must be infilled or rehabilitated, and yields have been lower than anticipated. In line with the 1976 survey of the tea industry, additional planting has been carried out and effective rehabilitation and infilling has been achieved except in the Bukoba area. Recommendations of the survey regarding crop yields, husbandry techniques, field organization, TTA structure and extension activities are also being implemented. Furthermore, market trends in tea have taken a favorable turn. In general, progress on the project is improving. The closing date will be postponed to allow sufficient time for completion of the Mwakaleli factory. Credit No. 382-TA - Second Livestock Development Project: US$18.5 million Credit of May 23, 1973; Date of Effectiveness - September 28, 1973; Closing Date - December 31, 1980 This project was the subject of an in-depth review in November 1976 and again in January Although progress has been made in alleviating the financial problems of the meat processing parastatal (TPL), in correcting some of the deficiencies in the livestock marketing parastatal (TLMC), and in adopting some of the decentralized management recommendations in the ranching parastatal (NARCO), TPL will still need to improve its overall efficiency, and NARCO its unsatisfactory financial situation. The most serious issue is the 1/ These notes are designed to inform the Executive Directors regarding the progress of projects in execution and in particular to report any problems which are being encountered and the action being taken to remedy them. They should be read in this sense, and with the understanding that they do not purport to present a balanced evaluation of strengths and weaknesses in project execution.

33 ANNEX II Page 4 of 17 lack of adequate financial support from the Treasury; this issue was taken up during the last review and the Tanzania Livestock Development Authority (LIDA) is organizing a meeting between NARCO, the Commissioner for Public Investment (CPI) and the Tanzania Rural Development Bank (TRDB) to address the issue of equity contributions In summary, although progress has been made, major problems remain and will require continued attention. The closing date of the Credit has been postponed by 12 months to December 31, 1980 in order to complete the ranch development program. Credit No. 454-TA - Geita Cotton Project: US$ million Credit of January 17, 1974; Date of Effectiveness - April ; Closing Date December 31, 1982 The project continued to show good progress since the appo-intment in October 1977 of a new Project Manager 0 However, in view Cf the failure of the crop technical packages to give economic responses, the pro'ect must now be consi-dered to be an infrastructure and adaptive research project rather than an agri'cultural product-ion project. A major object,ve i's now to develop 4 a more soundly based and productive agricultural strategy 0 The most sign-'fi cant progress has been in the trial program with about 50 well distribousted and superv-lsed trlal sites and improved credit recovery 0 Recruitment of staff has been more vigorously pursued since the Project Im3lementation Reviews began0 Project problems remaining are the lack of senior staff, the shortage of extens'-on staff, delay in deliveries of some equipment and f-thancilng of road construction 0 The project will continue to be kept under close review 0 Loan No TA Cashewnut Development Project: US$21. 0 million Loan of June 24, 1974; Date of Effectiveness - September 26, 1974; Closing Date -- December 31, 1981 Construction of the five factories and ancillary facilities is proceeding well in accordance with the revised completion schedule. Processing plant and machinery has been delivered to two factories, and is under shipment for the remaining threeo The project faces problems with regard to expected marketed production reaching potential processing capacity. This continued decline in the marketed production is, however, puzzling in view of the price increase and the attractive returns per labor day. An intensive analysis of the cashewnut production issue is to be carried out by the Government agencies responsible for review of agricultural production in Tanzania. The take over of the industry by the Cashewnut Authority (CATA) and the consolidation of its activities are proceeding; its management has improved since the appointment of a new General Manager last year.

34 ANNEX II Page 5 of 17 Credit No. 508-TA - Kigoma Rural Development Project: US$10.0 million Credit of August 21, 1974; Date of Effectiveness - November 20, 1974; Closing Date - December 31, 1980 Progress has been made in improving control of materials flow for civil works, promotion of a coffee production program, labor-intensive road works, project accounting and disbursement performance, and increasing farmer demand for inputs. However, project implementation continues to be slow. Little construction work has taken place over the last five months of wet season agricultural activities. Trials were planted late in two of the three districts due to misallocation of project finance vehicles. Little action has been taken on procurement. As recommended in the mid-term review of this project, agreement has been reached on a number of proposed amendments to the legal documents in order to make the project design more flexible. Credit No. 513-TA and Loan No TA - Kilombero Sugar Development Project: US$9.0 million Credit and US$9.0 million Loan of September 27, 1974; Date of Effectiveness - February 14, 1975; Closing Date - December 31, 1979 Project work is virtually completed except for purchase of some vehicles and completion of the sugar survey and the training program. In view of this, the closing date may have to be extended by nine months. Kilombero Sugar Company's (KSC) land development on behalf of outgrowers continues and is expected to exceed appraisal estimates due to lower than expected cane yields. A new management advisory agreement for a further two years with emphasis on agriculture will be financed by the Netherlands. Phase III of the Sugar Study has been started and should be completed shortly. With regard to the Sugar Development Corporation's request to Treasury to consider KSC's proposals as to its debt-equity ratio, the Treasury has decided to provide KSC TSh. 100 million as equity and TSh. 100 million as loan from Dutch/Danish sources. The loan will be at an interest rate of 7% p.a. with 30 years repayment including 5 years of grace. The Subsidiary Loan Agreement is under preparation and is expected to be signed by the Treasury shortly. Credit No. 652-TA - Fisheries Development Project: US$9.0 million Credit of July 12, 1976; Date of Effectiveness - October ; Closing Date - December The Project is progressing at a slower pace than anticipated and fishing operations are now expected to begin by early Eight vessels for the coastal commercial centers are already under construction, and procurement of engines and fishing gear is in progress. Tender documents for the procurement of steel boats for the Kigoma Commercial Center are being finalized. The recent outbreaks of cholera at Lake Tanganyika have caused a setback in Project activities on the Lake, particularly the Ujamaa Village Program, and steps have been taken to speed up the identification of suitable villages and the preparation of investment plans.

35 ANNEX II Page 6 of 17 Credit No. 606-TA - National Maize Project: US$18.0 million Credit of January 29, 1976; Date of Effectiveness - May 28, 1976; Closing Date - June 30, 1980 Although the project has made some satisfactory progress with regard to village participation, delivery of inputs and concentration of high potential maize regions, it is beset by a number of problems which must be overcome if the project is to achieve its primary objective. Following a midterm review of the project, the Government submitted in September 1978 draft proposal for a three year Intensification Phase in six regions where potential for increasing production exists, extending the project period from July 1979 to June The project has therefore been redesigned in order to intensify the project activities during the remaining period. The redesign of the project has been agreed upon by the Government, BADEA (the co-financier) and the Association. Credit No. 580-TA - Dairy Development Project: US$10.0 million Credit of August 15, 1975; Date of Effectiveness - November 13, 1975; Closing Date - April 30, 1981 The project status deteriorated during The large scale parastatal farms have been poorly managed, production is below expectation and financial prospects are dismal. The ujamaa component proceeds slowly and the Tanzania Rural Development Bank is actively investigating alternative means of assisting village milk production and consumption. The foot and mouth disease control investigation has commenced. The project will continue to be kept under close review. Loan No TA - Sao Hill Forestry Project: US$7.0 million Loan of July 12, 1976; Date of Effectiveness - October 12, 1976; Closing Date - June 30, 1982 Although the project got off to a slow start, physical progress has now been satisfactory for the past two years. The nurseries are well stocked and maintained, and the current planting program on schedule. Progress on fire protection, road construction and building is satisfactory. Procurement of equipment needed for the next season is, however, delayed and project accounts need updating. These are partly due to staffing problems; the position of financial controller and workshop foreman became vacant as well as the position of assistant project manager and silviculturist/economist. Government is approaching bilateral agencies for recruitment assistance.

36 ANNEX II Page 7 of 17 Credit No. 658-TA - Tobacco Processing Project: US$8.0 million Credit of September 16, 1976; Date of Effectiveness - February 15, 1977; Closing Date - December 31, 1981 Improvements to the existing line were completed except for installation of the main circuit breaker equipment. Building work at Morogoro is proceeding satisfactorily. TAT/TTPC are preparing a properly coordinated building program to cover the balance of the project, and proposals are awaited from the Treasury rationalizing the financial and functional responsibilities of these entities. TAT's financial position is critical due to high bank overdrafts. The Treasury has agreed to reimburse TAT TSh. 29 million representing the local contribution it has spent on the project. In addition, TAT has also claimed TSh. 13 million from the Treasury to meet the cost incurred by them during TTPC's accounts for 1976/77 have been audited and the report is expected shortly. Credit No. 703-TA and Credit No. 703-TA-5 - Tabora Rural Development Project: US$12.0 million Credits 1/ of May 11, 1977; Date of Effectiveness - November 11, 1977; Closing Date - June 30, 1983 The level of regional commitment to the project has been good and overall project performance is satisfactory; disbursements are on schedule. However, some delays have been experienced in the delivery of equipment and vehicles procured under the project, and shortage of trained extension agents in the Region continues to hamper the crop development component. These delays should not be over-emphasized since project management has been effective in getting the project initiated. Credit No. 801-TA - Second Cashewnut Development Project; US$27.5 million Credit of June 14, 1978; Date of Effectiveness - October 2, 1978; Closing Date - December 31, 1984 This credit became effective on October 2, Project implementation is progressing satisfactorily. However, CATA is facing some financial difficulties which are being discussed with the Treasury. Credit No. 802-TA - Tobacco Handling Project: US$14.0 million Credit of June 14, 1978; Date of Effectiveness - January 5, 1979; Closing Date - April 30, 1983 The project has made a slow start. Procurement of vehicles and equipment is also lagging. However, progress on recruitment of technical assistance has been good. The Building Engineer, Financial Systems Development Assistant and Transport Officer are all in post. Three suitable candidates have been identified for the five posts of Regional Accountant and advertisement of the other two have been done. 1/ Credit No. 703-TA-5 (US$4.8 million) is financed under the special CIDA arrangement; Credit No. 703-TA is an IDA Credit of US$7.2 million.

37 ANNEX II Page 8 of 17 Credit No. 803-TA - Rural Development Project (Mwanza/ Shinyanga): US$12.0 million Credit of June 14, 1978; Date of Effectiveness - March 5, 1979; Closing Date - December 31, 1984 While some of the senior support staff have been recruited, most key posts remain to be filled, and although good progress has been made in the livestock, water resource and forestry components, the expected implementation of an experimental program of agricultural extension has not been initiated. Future supervision missions will pay particular attention to progress made by the agricultural extension staff towards improving the extension system. The effects of the Uganda war are still being felt in the project's area causing problems for the supplies situation. EDUCATION SECTOR Credit No. 371-TA - Fourth Education Project: US$10.3 million Credit of April 13, 1973; Date of Effectiveness - July 2, 1973; Closing Date - December 31, 1979 Physical implementation, particularly the execution of civil works, has improved considerably and overall completion of the project has reached 95%. However, to allow sufficient time for completion, the Closing Date has been postponed by 18 months to December 31, 1979, but would still require an additional 6 months. Total project cost is now estimated at about TSh. 109 million, an increase of approximately 5% over the appraisal estimate of TSh. 104 million. The Government does not foresee any financial problem in providing the required additional funds. Three Community Education Centers out of eight have started operating programs for village development, education and training for youth and adults. The two Vocational Training Centers are in operation at almost full capacity. The technical assistance and fellowship programs are approaching completion and matching funds disbursed. Savings under the technical assistance and fellowship component of the project are estimated at approximately US$1.3 million. Credit No. 607-TA - Fifth Education Project: US$11.0 million Credit of January 29, 1976; Date of Effectiveness - March 23, 1976; Closing Date - June 30, 1982 Progress in physical implementation is satisfactory. Construction of extensions to fifteen secondary schools is progressing well and construction of 1,500 houses for Village Management Technicians, although delayed, shows some improvement. In fact, housing construction is in line with VMT training which will be extended until mid-1980 as a result of the reassignment of over 500 VMTs as Village Managers in January There are delays in recruitment of experts by UNESCO to assist a secondary school facilities survey and in recruitment of accountancy experts for the National Board of Accountants and Auditors. Implementation of a separate review of accountancy training and a survey of primary schools are progressing slowly. Despite these delays, project completion can be expected by the initial Closing Date of June 30, 1982 and no financial problems are envisaged at present.

38 ANNEX II Page 9 of 17 Credit 861-TA - Sixth Education Project - US$12.0 million Credit of January 22, 1979; Date of Effectiveness - June 25, 1979; Closing Date - June 30, 1985 This credit became effective on June 25, The Ministry of Labor has appointed a representative to the Project Unit and is working with the Ministry of Education on a plan for coordinating project implementation. TOURISM SECTOR Credit No. 860-TA - Tourism Rehabilitation Project US$14.0 million Credit of January 22, 1979; Date of Effectiveness - August 24, 1979; Closing Date - June 30, 1983 This credit became effective on August 24, Project implementation is progressing satisfactorily. Recruitment of project coordinator is being finalized and the consultants for the rehabilitation of project lodges and hotels, have been appointed. TRANSPORTATION SECTOR Credit No. 507-TA - Highway Maintenance Project: US$10.2 million Credit of August 21, 1974; Date of Effectiveness - November 20, 1974; Closing Date - December 31, 1980 After a slow start, project implementation improved. Seventeen of the 22 local staff positions are filled and virtually all expatriate experts will have local counterparts to train. All equipment procured through ICB have been delivered. Rehabilitation, regravelling and routine maintenance activities have improved in both quality and quantity. However, it is necessary to recast the project by amending its scope to address the problems which have been encountered in implementing the project; these changes will bring the project in line with the Fifth Highway Project. The Closing Date has been postponed to December 31, 1980 to allow for completion of the project and the disbursement. The technical assistance contract with the consulting firm "ORT" will expire in November 1979, and the Government is now recruiting individual experts to complete the project. Credit No. 743-TA - Trucking Industry Rehabilitation and Improvement Project: US$15 million Credit of November 3, 1977; Date of Effectiveness - April 3, 1978; Closing Date - June 30, 1983 Implementation planning is progressing well. Initial progress in the recruitment of technical assistance has been good, with 24 people in post or approved out of a total of 29. The project is experiencing some problem with equity contribution for the proposed project transport companies. The Treasury proposed to provide the balance of the equity contribution for

39 ANNEX II Page 10 of /80. The National Transport Coordination (NTC) has submitted a report to the Treasury regarding the availability and distribution of vehicle spare parts in recent years. NTC has also commissioned a study of the role and objective of the National Institute of Transport. The design of the transport data collection system is progressing well. URBAN SECTOR Credit No. 876-TA - Fifth Highway Project; US$20.5 million Credit of March 2, 1979; Closing Date - December 31, 1984 This Credit is not yet effective. Credit No. 495-TA - National Sites and Services Project; US$8.5 million Credit of July 12, 1974; Date of Effectiveness - October 3, 1974; Closing Date - December 31, 1979 Infrastructure construction has been completed satisfactorily on all project sites. Construction of health facilities in Dar es Salaam is completed and ready of occupation. Education facilities for the Dar es Salaam sites have been completed; the rest of the community facilities in the project are nearing completion. Progress on the lending program administered by the Tanzania Housing Bank is slow although satisfactory progress is being made in the implementation of the action program to improve it. Total project cost is estimated (at current exchange rates) at US$15.9 million, compared to the appraisal estimate of US$16.7 million. Credit No. 732-TA - Second National Sites and Services Project: US$12.0 million Credit of November 3, 1977; Date of Effectiveness - April 3, 1978; Closing Date - June 30, 1982 Progress on implementation is satisfactory for the residential components although overall implementation progress is slow. Preparation of the small scale industry component is also making satisfactory progress. All project staff have now been appointed. The Consultants' report on the Land Rent and Service Charge Study was approved by the Government in January 1978 and a pilot test of the new Urban Charge System for cost recovery proposed in the study was carried out in Morogoro. However, progress in the implementation of this system in other areas is slow. Disbursements are substantially behind appraisal estimates. These issues will be reviewed during the next supervision mission.

40 ANNEX II Page 11 of 17 WATER SUPPLY SECTOR Loan No TA - Urban Water Supply Project: US$15.0 million Loan of January 5, 1977; Date of Effectiveness - March 2, 1977; Closing Date - June 30, 1981 Of the five main contracts for water supply works in Morogoro, contract for exploratory drilling at Mindu Dam site is completed, two contracts for plant (pumping and treatment) are in the stage of final inspection of goods prior to shipment to Tanzania, and two construction contracts were awarded In December 1978 and March Completion of the water works expansion is expected in February 1981, 21 months behind schedule, but a pilot operation is scheduled to commence in November Project cost is now estimated at US$27.6 million, 43% over the appraisal estimate of US$19.2 million. In December 1978, the Government approved an increase in its contribution to the project to cover the financing gap. Some progress has been made towards creation of a parastatal national urban water supply authority and increase in tariff to maintain their levels in real terms at the level existing in July Progress in project implementation and the expected large increase in project costs will have to be closely monitored. POWER SECTOR Loan No T-TA - Kidatu Hydroelectric Project Phase II; US$30 million Loan on Third Window Terms of August 12, 1976; Date of Effectiveness - March 1, 1977; Closing Date - December 31, 1981 _ The project is financed by IBRD, SIDA and KfW. All contracts have been awarded. Project construction is on schedule at all sites. TANESCO has obtained approval on its tariff increase. Current estimated project cost is US$97.8 million compared to appraisal estimate of US$89 million, a cost overrun of 28%. This is mainly due to underestimation of the project costs by the engineering consultants. KfW has already increased its contribution to the project and SIDA has indicated that it would be prepared to increase its allocation to cover its proportionate share of the cost overruns. Plans to make any additional contribution by the Bank to bridge the gap is being reviewed. It is expected that US$7.0 million from the EEC Special Action Fund will be allocated to this project.

41 ANNEX II Page 12 of 17 INDUSTRIAL SECTOR Credit No. 460-TA - Tanzania Investment Bank Project: US$6.0 million Credit of February 13, 1974; Date of Effectiveness - April 18, 1974; Closing Date - December 31, 1979 This Credit has been fully committed. Because of a reallocation of funds from a subproject previously approved to a new one still under. implementation, the credit is still not fully disbursed and the closing date has been postponed to December 31, 1979 but may require a further postponement of 6 months. Loan No TA - Tanzania Investment Bank: US$15.0 million Loan of November 12, 1975; Date of Effectiveness - February 20, 1976; Closing Date - December 31, 1980 This loan is fully committed and disbursements are proceeding satisfactorily. Loan No TA - Tanzania Investment Bank: US$15.0 million Loan of December 28, 1977; Date of Effectiveness - April 3, 1978; Closing Date - June 30, 1981 This loan is now fully committed and disbursements are proceeding satisfactorily. Loan No TA - Mwanza Textile Project: US$15.0 million Loan of June 19, 1975; Date of Effectiveness - October 6, 1975; Closing Date - July 1, 1980 The project provides for expansion of an existing textile mill and is designed to increase annual fabric production capacity by 20 million linear meters. Project implementation performance has been acceptable and all technical installations are now operating satisfactorily. The National Textile Corporation (TEXCO), the holding company for state-owned textile mills, has agreed to institute an immediate action program to improve the operating performance of existing mills. The project was technically completed in October 1978 with a savings of about US$1.7 million. In order to utilize this amount for rehabilitation of the existing facilities, which are essential parts of the project, the Closing Date was postponed by one year to July 1, 1980.

42 ANNEX II Page 13 of 17 Credit No. 601-TA - Technical Assistance Project: US$6.0 million Credit of January 9, 1976; Date of Effectiveness - September 14, 1976; Closing Date - June 30, 1980 Total commitments as of September 30, 1979 were US$4.8 million of which US$4.1 million,- US$0.4 million and US$0.3 million were for consultancy services, training and project unit services, respectively. The procedures for processing proposals have been streamlined and it is expected that the pace of commitments and disbursements will be increased. Loan No T-TA/Loan No TA - Morogoro Industrial Complex: US$11.5 million Loan on Third Window Terms and US$11.5 million Bank loan, both of April 6, 1977; Date of Effectiveness - July 6, 1977; Closing Date - December 31, 1982 Project implementation is proceeding satisfactorily in spite of some initial delays in the appointment of consultants and start-up of procurement. Although there will be some delays in the start-up of individual components of the Industrial Complex, completion of the project is still scheduled for July Revised capital cost estimates are only slightly higher than those contained in the Appraisal Report. Credit No. 833-TA/Loan No TA - Morogoro Textile Project: US$20.0 million Credit and US$25.0 million Loan of June 29, 1978; Date of Effectiveness - May 7, 1979; Closing Date - June 30, 1985 This loan and this credit became effective on May 7, Preparation of tender documents are progressing satisfactorily and no delay in project completion is anticipated. Credit No. 875-TA/Loan No TA - Mufindi Pulp and Paper Project: US$30.0 million Credit and US$30.0 million Loan of April 6, 1979; Closing Date - December 31, 1983 This loan and this credit are not yet effective. Loan No TA - Tanganyika Development Finance Company, Ltd. (TDFL) Project: US$11.0 million Loan of July 27, 1979; Closing Date - December 31, 1983 This loan is not yet effective.

43 ANNEX II Page 14 of 17 EAST AFRICAN COMMUNITY There are currently five projects in execution in the East African Community. 1/ Loan No. 638-EA - Second Harbours Project: US$35.0 million Loan of August 25, 1969; Date of Effectiveness - December 16, 1969; Closing Date - December 31, 1977 Loan No. 865-EA - Third Harbours Project: US$26.5 million Loan of December 18, 1972; Date of Effectiveness - April 16, 1973; Closing Date - June 30, 1978 The Second Harbours project included financing for five general cargo berths and a single bay tanker terminal for the Port of Dar es Salaam; two general cargo berths and a bulk cement wharf for Mombasa; tugs, lighters, cargo handling equipment, offices, housing and general improvements for both ports. The Third Harbours project included three new deep water berths, modernization of two berths and a lighterage quay, a training school building and central repair area for Dar es Salaam; modernization of several berths and a lighterage quay, construction of a tug berth, cold storage facilities and a training building in Mombasa and improvement of a lighterage quay in Tanga. Construction of all major project elements has been completed and a joint project completion report was issued in January Because of shortage of funds under both loans, the following minor project elements have not been submitted for Bank financing: the second phase of modernization of the lighterage quay and a training school for Dar es Salaam; modernization of the lighterage quay and a training school for Mombasa. Locally financed contracts have been awarded for these project elements with the exception of the modernization of the lighterage quay in Mombasa. General cargo throughput has increased above appraisal forecasts for Dar es Salaam, and cargo handling productivity has improved with increasing throughput; however, port labor productivity has stagnated in Mombasa where general cargo throughput has declined considerably. Legislation to establish a Tanzania Harbours Authority and a Kenya Ports Authority has been enacted. Management of Ports in 1/ Since October 1, 1977, the East African Community loans (excluding the East African Development Bank) have been disbursed on the basis of separate national guarantees. The agreed allocation of undisbursed balances for each loan, as proposed in a report to the Executive Directors dated December 29, 1977 (R77-312) and approved on January 12, 1978, is given in this Annex. The closing date for Loans 638-EA, 674-EA and 865-EA have passed. However, since the amount allocated to and guaranteed by each Partner State is clearly identified under the terms of the Agreement signed on January 25, 1978 as proposed in the above report (R77-312), we are continuing disbursements.

44 ANNEX II Page 15 of 17 both countries is competent. Some US$34.4 million of Loan 638-EA and US$25.6 million of Loan 865-EA has already been disbursed. The agreed allocation of undisbursed funds at October 1, 1977 between the countries concerned is given below: For Loan No. 638-EA (US$ million) Kenya 0.7 Tanzania 0.6 For Loan No. 865-EA Total 1.3 Kenya 1.7 Tanzania 0.3 Total 2.0 Loan No. 674-EA - Third Railways Project: US$42.4 million Loan of May 25, 1970; Date of Effectiveness - October 30, 1970; Closing Date - June 30, 1978 The original purpose of the project was to complete the Railways' Development Program, including track improvement, procurement of rolling stock and other equipment, and to finance studies of the economic feasibility of certain railway lines and services. The physical execution of the original project has been seriously delayed due to administrative and political problems within the Community. In November 1974, the Executive Directors approved a reallocation of the uncommitted balance of the Loan to be used for consultant services and emergency investments in track material. All three countries have now enacted legislation to establish their own Railways Corporations. The agreed allocation of undisbursed funds at October 1, 1977 among the various countries concerned is given below: $ Million Kenya 2.0 Tanzania 3.8 Uganda 1.9 Total 7.7 On January 12, 1978, the Executive Director approved the utilization of US$1.2 million equivalent to finance the East African Mediation effort.

45 ANNEX II Page 16 of 17 Loan No. 914 EA - Third Telecommunications Project: US$32.5 million Loan of June 22, 1973; Date of Effectiveness - September 19, 1973; Closing Date - December 31, 1979 The project included provision for procurement of local telephone exchange equipment, cables and subscriber apparatus, microwave and UHE/VHF systems and multiplex equipment, interurban cables and wires, automatic switching and signalling equipment, telegraph, telex and data equipment, and training. All project items except the microwave radio system have been completed; this system is likely to be completed by mid The slippage of the project's completion was due to initial delays in procurement caused by staffing and other problems associated with the relocation of headquarters. At September 30, 1979, about US$28.4 million of the loan had been disbursed. The agreed allocation of undisbursed funds as at October 1, 1977 among the countries concerned is as follows: $ Million Kenya 2.4 Tanzania 3.5 Uganda 0.1 Total 6.0 Loan No EA - East African Development Bank: US$15.0 million Loan of March 1, 1976; Date of Effectiveness - June 7, 1976; Closing Date - March 31, 1980 The environment within the Community has continued to have a negative impact on EADB operations. Level of operations both for appraisal and supervision has been depressed, but there has been some improvement in the state of the portfolio with the arrears affected portfolio falling from 50% as of June 30, 1977 to 43% as of June 30, Some US$9.1 million of the loan has been disbursed to date, and the uncommitted balance amounts to US$3.0 million.

46 ANNEX II Page 17 of 17 D. STATEMENT OF IFC INVESTMENT IN TANZANIA AS OF SEPTEMBER 30, 1979 Fiscal Year Obligor Type of Business Amount in US$ Million Loan Equity Total 1960 and 1964 Kilombero Sugar Company Food Processing Highland Soap and Soap Manufacture Allied Products Limited 1979 Metal Products Limited Household Utensils Total gross commitments Less cancellations, terminations, repayments and sales Total commitments now held by IFC Total Undisbursed

47 ANNEX III TANZANIA DAR ES SALAAM PORT ENGINEERING PROJECT SUPPLEMENTARY PROJECT DATA SHEET I. Timetable of Key Events (a) Time taken to prepare the credit 6 months (b) Project prepared by : Government and Consultant (c) First presented to the Bank Group : April 1979 (d) Preparation mission (e) Appraisal mission (f) Completion of negotiations October 1979 (g) Estimated date of effectiveness March 1980 LI. Special Bank Implementation Actions None III. Special Conditions (a) By June 30, 1980, THA will complete a review of its tariff levels and furnish the findings and recommendations of such review to the Association for its review and comments (para. 44). (b) Upon completion of the engineering services, the Government and THA would consult with the Association on the recommendations and conclusions relating to the project (para. 49). (c) Completion of a Subsidiary Loan Agreement, satisfactory to the Association between the Government and THA would be a condition of effectiveness (para. 57).

48

49 IBRD 'soc. / ~~~~~~~~~ 1979 /l / ORf,caI Host~~~~~~~rta Ettatee~~~P 1, ~ oa Post Gatt % o I \ he I/d P. GadS Nhed3 rnmc C,.~~~~~~~~~~~~raeke CIT '71~~~~~~~~~~~~~~Sa L~g4e Anhorag >7 Maoerrga~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 5 // ~ H ~ ~ Ra Ahclo:g I ~~~~~~~~~~~~~~~~~~~~~~~~AogieB h ZAR~~~E - i 1 SOrtc j4 TANZANIA J, ~~~~~~~~TANZANIA PORT O F DAR E S SALAAM/ i/ TIPER C)IL REFINFRY EXISTING AND PROPOSED DEVELOPMENTS I CONTAINER FACIL TY /7 ~~~~~~~2 IMPORT WAREHOUSE cso TUG BERTH 5 OIL BERTH Wa R' t~ ~~~~~~~~~ / ~~~~~13 GRAIN SILO, UJNLOADER, AND CONVEYOR ~~~~~ I ~~~~~~~~~~~6 DEMOLITION OF EXISTING OIL JETTY.: nih B-k a ae oordh h 5 T0Ra TRC RAILWAY (Ir Gmgol.) rrr Ocean TAZARA RAILWAY III.o G..g. el to t9'~~~~~~~~~~~~~~~~~~~ I ~~~~~~~MOORING BUOYS Wo t,rhld -depei o-k 05f50- a E-t F-y er Pt~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Er t ooelrh h ~O 510O _,osasrfe,hooa,e,~~~~a RAAL,AWR ~~~~~~~~~~~~~~~METERS.

50

51 IBRD AUGUST 1979 LIGHTER ) WHPARF *SN 0 g DAR ES SALAAM KURASINI c 0/ DOCKYARD ~AKABEWEST FERRY C r,po -< i ee 9Sit FONT EAST FERAS R GO RS RONGONI $0,?X, 3~~~~~!3 This rap has been prepared by the World Banks staff e-elsrely for,. the coanenenca of the readers of the report to shech it is attached The dnore,nations used and the 2 boundaries shown on this rap - P do not reply, on the part of the ' World Bank and its affiliates, anv 1odgreet on the legal statos of any territory or any endor-erer t or acceptance of such boundaries. TANZAN IA PORT OF DAR ES SALAAM ENTRANCE CHANNEL IMPROVEMENT r0k jfieleoio * :-': '' : CHANNEL DREDGING -. vr k IS4;r r' CURRENT Andictn CHANNEL ALIGNMENT T_ / -' s,iv ;GOceoiri PREVIOUS CHANNEL ALIGNMENT TANZANIA A BOI la-i IRE i2-l ranzaniak Doe Drc SScloare * BEACON OR LIGHT REEF 10- r s t A + 5 METERS STREETS 2000MAJOR q f0alwai I METERS