Public Disclosure Authorized

R.pod No. 90!

TheWorld Bank
Impact EvaluationReport
Benin-HinviAgriculturalProject
(Credit144-BEN)
April5,1964
Public Disclosure Authorized

Operations Evaluation Department

FOR OFFICIAL USE ONLY
Public Disclosure Authorized
Public Disclosure Authorized

Doaunent of the d Bank .-

This document has a restrited dkistibtion and may be used by recipents

only in the perfoffmanceof thei officialduties. Its contents may not otherwise
be discdosedwithout V'A,ddBank authorization.
 ABBREVIATIONS

ffb - Fresh fruit bunches (of oil palm)

FAC - Aid and Cooperation Fund (French bilateral assistance)

FED - European Development Fund

PMWA - Bank Permanent Mission in Western Africa

SOBEPALH - Beninese Oil Palm Corporation

SONADER - National Company for Rural Development

ZOCA - Annual crops area

 FOR OMCIAL USEONLY
THEWORLD BANK
Washington.
D.C.20433
USL

Odice caDi,ectcr-Gmal
Opera0omEvaluan

April 5, 1984

MEMORANDUM
TO THE EXECUTIVE DIRECTORS ANMTHE PRESIDENT

SUBJECT: Impact Evaluation Report - Benin Hinvi Agricultural

Project (Credit 144-BEN)

Attached, for information, is a copy of a report entitled

"Impact Evaluation Report: Benin - Hinvi Agricultural Project
(Credit 144-BEN)" prepared by the Operations Evaluation Department.

Attachment

Mervyn L. Weiner

by Shiv S. ICapur

This document has a restricted distribution and may be used by recipients only in the performance
of their officialduties Its contents may not otherwise be disclosed without World Bank authorization.
 FOR OMCIAL USE ONLY

IMPACT EVALUATIONREPORT

BENIN - HINVI ACRICULTURALPROJECT

(CREDIT 144-BEN)

TABLE OF CONTENTS

Page No.

Preface .. ......................................................... i
Summaryand Conclusions ............ ............................... ii

I. INTRODUCTION 1

II. AGRICULTURAL IMPACT . 6

III. MAINEXFASONS
FOR PROJECT FAILURE. 9

IV. ECONOMIC AND FINANCIAL IMPACT . .. 5.....................

V. SOCIAL IMPACT . . 17

VI. CONCLUSIONS AND OUTLOOKFOR THE FUTURE .. 19

VII. LESSONS LEARNEDFROMTHE PROJECT 20

Annexes

1. Land Use by Cooperatives ................................. 23

2. Yields per Hectare on Cooperatives, 1973-82 ...... 24
3. Yield Curve: Latest Estimates and Achievements . .25
4. Annual Rainfall Deficit in Pobe 26
5. Social and Economic Characteristics of Hinvi Region 27
6. SOBEPALH: Cost of ffb as a Proportion of Total Sales 32
7. Different Worker Groups Within the Cooperatives as of
April 1983 ...... .... ....... 33
8. Work Reaction to the Cooperative Experience ...... 34
9. Profit and Loss Statement of the Cooperatives from
1977-82 ......................... 38
10. Composition by Age and Sex of the Five Rural Communities
in the Hinvi Region .................................... 39
11. Bank Contribution to the World Oil Palm/Coconut Sector ... 40

Map IBRD No. 2112

Ithei
n document has a eVkftd diMibutil and maybeued byr
ofcial dute Itscontents waynot oterwise be diL
onlyinth perfomance of I
witout WorldBank auto0rizto.
 IMPACT EVALUATIONREPORT

BENIN - HINVI AGRICULTURAL PROJECT

(CREDIT 144-BEN)

PREFACE

This is an Impact Evaluation Report of the Hinvi AgriculturalProj-

ect in Benin, for which Credit 144-BEN in the sum of US$4.6 million and
supplemental credit 144-2-BEN of US$600,000 were approved in February 1969
and January 1974 respectively. The French Fund for Aid and Cooperation (FAC)
co-financed the project with the Bank and contributed a total of US$5.1
million equivalent. The project was closed in June 1976 after cancellation
of US$25,000.

The Impact Evaluation Report is based on a review of the Appraisal

Report (No. TO-615b) dated February 3, 1969, the Project Performance Audit
Report (PPAR, OED Report No. 2053) of May 19, 1978, the FAC Evaluation Report
dated May 1981 and the French Central Economic Cooperation Agency (CCCE)
Report on the oil palm sector in Benin of April 1983; relevant Bank files and
documents have also been consulted, and particularly the Review of the Oil
Palm Sector prepared by Booker Agriculture International,Ltd. (Bank consul-
tant), in July 1982; Bank staff associated with the project have been
interviewed.

An OED mission visited Benin in January 1983 and held discussions

with officials of the Ministry of Planning, SOBEPALH and SONICOG. A field
trip to interview a number of participating farmers was undertaken. Farm
surveys and data gathering were carried out from February to April 1983 by
Mr. Ogunsola John Igue, Professor at the National University of Benin, who
interviewed a sample of 48 cooperative members and held discussions with the
10 cooperative boards of directors in the project area. The information
obtained during these missions and discussions was used to test the validity
of some conclusions of the 1978 audit report and to assess the project's
impact on agricultural production, on the lives of the project beneficiaries
and on the Beninese economy.

A copy of the draft report was sent to the Borrower on December 23,
1983. However, no commentswere received.

The project was selected by OED for a second look evaluation

because its economic and social impact was still uncertain at the time of
audit and because its cooperative development approach was both innovative
and controversial.

The valuable assistance provided during the preparation of this

report by the Government of Benin, by officials of SOBEPALH and SONICOG, by
Professor Igue and by FAC and CCCE staff is gratefully acknowledged.
 - ii -

IMPACT EVALUATION REPORT

BENIN - HINVI AGRICULTURAL PROJECT

(CREDIT 144-BEN)

SUMMARYAND CONCLUSIONS

The Project

1. Credit 144-BEN (US$4.6 million), approved in February 1969, was to

assist in financing agricultural development in the heavily populated Hinvi
region through planting of 6,000 ha of oil palms and 1,000 ha of forest;
preparing 6,000 ha for annual crops; constructing an oil mill; developing
beef production; and constructing access roads and project facilities. The
project beneficiaries, about 4,000 farming families, were to be organized
into ten producer cooperatives, each with 600 ha of oil palm, 600 ha of
annual crops and 300 ha of pasture, afforestationand village area.

2. Farmer participation in the project was compulsory. The owners

(A7 members) of land were to receive one share, bearing a 3Z interest rate
per year, of the cooperative for each hectare leased by them for the project
on a fifty-year basis. Laborers ("B" members), mostly landless farmers, who
were to work at least 200 days on the establishmentof oil palm plantations,
were also to receive one share of the cooperative. Only "B- members were to
have a voice in the running of the cooperatives and a participation in the
cooperative profits. 'A' and "B- members were to receive a 1.5 ha plot of
annual crops to be worked individually by cooperative members following a
specific crop rotation. SONADER (later renamed SOBEPALH), the Project
Authority, was to manage the oil palm plantations on behalf of the coopera-
tives for the 25-year life of the project.

3. At appraisal it was recognized that the rainfall distribution in

the project area was sub-optimal but acceptable for oil palm production and
that organization and management of producer cooperativeswould be a diffi-
cult task that SONADER, an efficient and competent organization, would,
however, be able to carry out.

4. While the planting program was implemented on schedule, the annual

crop program soon ran into difficultiesbecause fewer farmers than expected
were prepared to abandon traditional shifting cultivation in the forest and
to take a 1.5 ha plot in project blocks. However, the introductionof animal
traction and a greater flexibility by SONADER on crop rotation stimulated
farmer interest.

5. At project completion, in 1976, about 14,000 ha including oil

palms, annual crops, afforestation, pasture and urban areas had been
developed. Functioning of the mill was satisfactory. Yields of oil palm,
however, were lower than estimated at appraisal. The annual crop system was
not popular with farmers; the yields obtained were low and the planned rota-
tion created labor constraints.
 - iii -

6. The project ERR was re-estimated at about 5Z, compared with 12X
calculated at appraisal. However, the social impact of the project was con-
sidered substantial. Different opinions were expressed in the PPAR as
regards the cooperative system, which was found by the PPAM "well on the way
to becoming efficient farmer organizations'while the PCR stated that it was
difficult to conclude that the cooperatives -had really taken root". In
addition, the PPAR stated that insufficient knowledge at appraisal of local
conditions and overoptimistic assumptions of labor availability had resulted
in difficulties with the maintenance of oil palms and an overestimation of
the benefits that the farmers could derive from the proposed annual crop sys-
tem. Neverthelessit was found that a new technology had been introduced in
the project area and farmers were adopting better practices than elsewhere in
the country.

Project Impact

7. Five years after completion, the project can now be considered a

major economic and social failure. Yields and production of oil palms have
only reached 25% of appraisal estimates, due to low rainfalls, poor mainr-
tenance of trees and considerable stealing of fruits. For annual crops,
cropping intensity and crop production remain at about 30X of appraisal
projections because the proposed technical package has proved unrealistic and
had an adverse effect on soil fertility. The livestock component has failed
and incurred financial losses for the past five years. Forests have been
partly destroyed by fire and illicit cutting.

8. With the benefit of hindsight, the project failure can be

attributed to four main reasons:

(a) the climatic conditions and natural resources of the project area
were overestimated and, as a result, the proposed technical
packages proved inadequate;

(b) the development approach, based on a compulsory producer coopera-

tive system, proved not adapted to the socio-economic context of
the region and generated strong opposition from the majority of
the beneficiaries;

(c) the failure to correct the original deficienciesof the cooperative

system; and

(d) the performance and financial situation of the project authority

severely deterioratedafter project completion.

9. The most striking factor of the project in 1983 is the disintegra-

tion of the cooperative system, which was found a relative success in 1978.
For the past five years no effort was made by the Government to promote
cooperative autonomy and self-management. A policy of paying low salaries
and low prices for oil palm fruits to cooperatives led to a vicious circle:
project beneficiaries found better employment opportunities elsewhere in the
country or abroad; the shortage of labor resulted in poor maintenance of the
plantations and low production, which in turn increased the disinterest of
 - iv -

farmers and increased the emigration process. Stealing of fruits by

cooperative members became a common practice. Project beneficiaries did not
consider themselves as cooperative members but as SOBEPALH laborers.

10. The project ERR is now negative. Deficit of food superseded the
surplus prevailing in the pre-project situation and most of the cooperatives
incurred deficits from their oil palm activities. The project impact on
balance of payment and Government revenues is negligible. While the farmer
incomes are now lower than they were before the project, the main benefici-
aries of the project appear to be the 1,500 civil servants working in the
Project Authority.

11. The social impact of the project can only be considered a dis-
appointment. Contrary to plans, no effort was made to improve the medical
and scholastic infrastructure in the project area. The project was not able
to offer, in the Hinvi region, adequate job opportunities for young men who
often opted for emigration. In addition, the project deeply disrupted the
traditional way of life of the population and had particularly adverse
effects on the living conditions of women, who lost a large part of their
ccmmprcial and artisanal activities.

12. Some important lessons can be learned from the project:

(a) the risk of planting oil palms in densely populated regions with
sub-optimal climatic conditions;

(b) the danger of introducing development strategies which strongly

upset the traditional way of life of the population when other and
less disruptive approaches have been successfullyexperimentedwith
in other countries; and

(c) the need for the Bank to ensure durability of completed projects
through its economic and sectoral dialogues with governments.
 IMPACT EVALUATIONREPORT

BENIN - HINVI AGRICULTURAL PROJECT

(CREDIT 144-BEN)

I. INTRODUCTION

A. Background

1.01 In 1965, natural groves of oil palm covered an estimated 0.4 to 0.5
million ha in Southern Benin; oil palm was the main source of edible fats for
the Beninese population and contributed to 73% of export earnings. Local
consumption was expected to increase from 23,000 tons to 32,000 tons in 1975
and to double by 1985. There was an urgent need to develop oil palm pro-
duction, both to meet domestic consumption and to maintain exports, if
possible.

1.02 Initial programs to increase palm oil production consisted of (i)

the construction, between 1951 and 1955, of four factories for milling fresh
fruit bunches (ffb) from natural palms and (ii) the planting of improved oil
palms on about 2,300 ha. These plantations, however, were not successful due
to land tenure problems and maintenance difficulties.

1.03 In 1962, the Government enacted legislation which allowed it to

acquire compulsorily the use of privately owned land in designated develop-
ment areas and to enforce the formation of producer cooperatives. At the
same time, the Government established SONADER, a parastatal authority
responsible for developing agricultural production in the country.

1.04 From 1962 to 1975, some 28,000 ha of improved oil palms were
planted and three palm oil mills were built by SONADER. Other rural develop-
ment activities were also integrated with oil palm development including
annual crops, reforestation, livestock, rural roads and social services. The
development strategy used by SONADERwas to acquire land in the vicinity of
villages, and to establish blocks of about 600 ha of oil palms (to permit the
use of modern agricultural methods) and of 600 ha of annual crops. Villagers
were grouped into production cooperatives and worked both oil palm and annual
crop blocks under the supervision and with the assistance of SONADER.

1.05 The oil palm program was mostly financed by FAC and FED until
1968. In 1966, however, the Government requested assistance from the Bank
because of a growing reluctance of FAC and FED to carry the full burden of
external financing of the proposed projects. PNWA then collaborated with
SONADER for the preparation of an oil palm development project, followed by
pre-appraisal in March 1967 and appraisal in August 1968, of the Hinvi Agri-
cultural Project, the subject of this Impact Evaluation Report.
 -2-

B. The Project

Project Design

1.06 The project, to be implemented over 10 years, consisted of:

(i) planting and bringing to maturity 6,000 ha of oil palms;

(ii) preparing 6,000 ha for annual crop production;

(iii) constructingan oil mill with an ultimate annual capacityof 70,000

tons of ffb;

(iv) planting 1,000 ha of forest (teak and cassia);

(v) developing beef production; and

(vi) constructingthe necessary roads and project facilities.

1.07 The project cost was estimated at US$9.6 million, of which IDA and
FAC were to finance 47.9% (US$4.6 million) each, and the Government the
remaining 4.2%. The main objective of the project was 'to develop an effi-
cient and modern system of agricultural production, capable of assuring
participating farmers of standards of living superior to those obtainable
from traditional farming methods."1 / To this effect the project benefi-
ciaries were to be organized into ten producer cooperatives,each with 600 ha
of oil palm; 600 ha of annual crops (the latter block sub-dividedin 1.5 ha
individual plots) and 300 ha of pasture, afforestationand village area.

1.08 Farmer participationin the project was compulsory since SONADER

was legally empowered to oblige landowners in the project area to join
producer cooperatives. The cooperatives were to have two kinds of members.
First were the owners of land who were to receive one -A" share for each
hectare leased by them for the project on a fifty-year basis. "A' shares
were valued at CFAF 30,000 (US$120) and were to bear 3% interest (CFAF 900,
or US$3.60) per year. Second were farmers wbo were to work for a minimum of
200 days on the establishmentof the oil palm plantations and agreed to work
a holding of 1.5 ha of azinualcrops. Members of the second group were to
receive a 'B' share, also valued at CFAF 30,000. Members qualifyingfor -B'
shares would be mostly landless farmers and would receive CFAF 125 for each
day worked on the plantation. (Since the official daily wage was CFAF 275,
the farmers were considered to be contributingCFAF 150 in value of work per
day to the project, or CFAF 30,000 in total.) Only "B3 share members were to
have a voice in the running of the cooperatives and to participate in the
profits of these cooperatives. This participationwas however limited to 3%
per year of the value of the shares. Any surplus after payment of interest
on"A" or "B" shares would be used for capital improvements and to increase
the daily wage of workers in the plantations. AW share members would be

1/ Appraisal Report, para. 4.02.

 -3-

encouraged to obtain -B" shares and become 'AB' members by working on the
plantations.

1.09 For the 25-year life of the project, SONADER was to manage the oil
palm plantations on behalf of the cooperatives. All revenues were to accrue
to SONADER, and only after all costs, including loan repayments, had been
met, would the surplus be paid to the cooperatives. The cooperativeswere to
become autonomous only after discharge of their debt to SONADER.

1.10 The 1.5 ha holdings of annual crops were to be worked by coopera-

tive members and their fandlies as individual enterprises. A specific crop
rotation, however, would be obligatorily followed for 1.2 ha of each plot
while on the remaining 0.3 ha farmers would be free to grow what they
pleased. The cooperatives would provide seeds, fertilizer and other inputs
as well as storage and marketing services, which would be paid for by
farmers.

1.11 A central project herd of 300 breeding cows would be established

and would provide stock for the ten project cooperatives. In addition 700 ha
of teak and 300 ha of cassia would be planted and their revenues would accrue
to cooperatives.

1.12 Ten villages were to be established and would be the headquarters

of the cooperatives. Villages would be sited adjacent to the cooperative
blocks and would be equipped under Government financing with water points,
schools and dispensaries.

1.13 At appraisal, it was recognized that the project would be subject

to two major constraints. First, the annual rainfall, and rainfall
distribution in the project area were found sub-optimal for oil palm produc-
tion; therefore oil palms would take longer to mature and yields would be
lower (about 50%) than those in the most favorable areas of West Africa.
Second, it was feared that the cooperative organization proposed might mean
that the farmers would neglect either field crops or oil palms.

1.14 The Appraisal Report concluded, however, that climatic conditions

were acceptable for oil palm development and that the possible cooperative
problems would be minimized by SONADER, an efficient and competent organiza-
tion which had gained considerable experience in agricultural development and
in the organization and management of producer cooperatives. The project was
considered a major contribution towards increasing production and exports in
a country where the development potential was not high. The project ERR was
estimated at about 12%. In the calculation of the ERR, the alternative
employment opportunities of cooperative members were costed at zero because
there were no other employment opportunities in the project area, and none
likely to become effective in the foreseeable future.

Project Implementation

1.15 The planting program started quickly and was completed on schedule
in 1970. Altogether, 6,075 ha of oil palms were correctly planted and
 -4-

reasonably well maintained despite difficulties in obtaining the labor needed

for these operations.

1.16 The annual crop program soon ran into difficulties. Fewer farmers
than expected were prepared to abandon traditional shifting cultivation on
plots cleared in the forest and take up 1.5 ha holdings in the project
blocks. On these 600 ha blocks, called ZOCAs, input use was minimal and
yields far below appraised targets. By 1971, only 450 farmers had taken up
plots in the ZOCAs. In 1971/72, a greater flexibility by SONADER,allowing
the farmers to choose the crop rotation, and the introduction of animal
traction stimulated more farmer interest. Thanks to technical assistance
financed by FAC, the use of animal traction increased rapidly. But
constraints on the supply of animals were believed to limit expansion of ox-
drawn cultivation, and further development of the ZOCAs remained uncertain.

1.17 The original project called for an oil mill of 24 t/h capacity to
be built in two stages. The revised project (April 1971) showed the need for
a 20 t/h mill, with provision for expansion to 40 t/h. Construction of the
mill was completed in 1974 as planned, but it did not go into operation until
mid-1975 owing to water-supply problems. The total investment cost was CFAF
962.4 million (US$3.9 million), as estimated in 1971. The functioning of the
mill was considered satisfactory on the whole, especially since some last
adjustments in 1977 made it possible to raise capacity to 27 t/h.

1.18 The project costs and financing schedule were revised twice. In
1971, with the difficulties encountered on the ZOCAs and a need to reallocate
oil palm production among existing and planned mills, project costs were
restructured. The Bank then abandoned its support to the ZOCAs, which
SONADERpursued thereafter with FAC technical assistance, and the funds thus
released helped finance the extra costs of the mill.

1.19 In 1973 SONADERfaced a financial crisis, caused by successive

dollar devaluations and non-payment of the government contribution, and
aggravated by the agency's failure to establish financial planning and
control systems. To solve these problems, IDA provided a supplemental credit
of US$600,000 in January 1974 and FAC contributed an additional US$520,000 to
the project. In the end, total project expenditures were slightly lower than
estimated (CFAF 2,266.6 million). IDA financing was increased, however, from
US$4.6 million to US$5.2 million, thus accounting for just over 54% of the
total bill. FAC's contribution amounted to 43% and the Government's to 3%.

Project Impact at Completion

1.20 At project completion, in 1976, about 14,000 ha, including oil

palms, annual crops, afforestation, pastures and urban areas had been
developed (details in Annex 1). The project was considered a mixed success.
Despite the excellent performance in planting and satisfactory maintenance,
oil palm yields and production had been below estimates. The principal
reason was rainfall. In most of the cooperatives, rainfall for two years
(1971/72 and 1972/73) was less than the minimum recorded over the previous
30-year period and was distributed very unevenly over neighboring coopera-
tives. Production was also affected by fires, spreading from where farmers
 -5-

were burning their fields, and theft due to the inadequate organization of
ffb collection and the higher prices obtainable on the parallel market.

1.21 For annual crops, the proposed cropping system was not popular with
farmers, who preferred their traditional practices. The new system did not
meet all the needs of the farmers; the part devoted to food crops was too
small, the yields obtained from commercial crops were low and the planned
rotation created serious labor constraints during the planting and harvesting
periods. Since the rotation system was obligatory, a number of farmers aban-
doned the ZOCAs, preferring to grow their crops outside the project area.
Later, relaxation of the rigid cropping pattern and the introduction of ox-
drawn cultivation were favorably accepted by the farmers and made it possible
to increase yields while reducing the per-hectare labor requirement. The
total number of farmers in the ZOCAs rose from 1,800 in 1973 to 3,000 in
1975.

1.22 Functioning of the mill was satisfactory, although the oil fat acid
content was high due to inadequate organization of fruit collection and the
insufficiency of storage capacity. The livestock and afforestation programs
had been completed as planned. The benefits of these components, however,
did not accrue to the cooperatives because animals available for sale were
sold at a price fixed by the Government at about 50% of the market price and
the teak and cassia plantations had not been properly maintained and some had
suffered from bush fire.

1.23 The project ERR was re-estimated at about 5%, with labor costed at
wage to reflect the labor constraints in the area.

Main Findings of the PPAR

1.24 The PPAR2 I concluded that although the project's accomplishments

had fallen short of appraisal expectations, the project had a substantial
social impact. In a region where natural conditions are marginal and poten-
tial productivity is low, a new technology had been introduced and farmers
were adopting better practices than in other parts of the country.

1.25 Different views, however, were expressed in the PPAM and the PCR.
The PPAM pointed out that, in contrast to experience in most African
countries, the project cooperatives "seemed to be well on the way to becoming
efficient farmers' organizations, managed to a large degree by the members
themselves." The phenomenon was mostly attributed to (i) legislation which
facilitated low-cost land reform by compensating land owners with shares
instead of cash while leaving management authority to the workers and (ii) a
fair system of remuneration (wages and dividends) which increases payment to
farmers as the cooperative develops. The PCR was less optimistic, stating
that although an operating framework of cooperatives had been set up, -it was
difficult to conclude that it had really taken root." The farmers who were
members of a cooperative did not perceive themselves as owners of the oil

2/ OED Report No. 2053, dated May 15, 1978.

 - 6-

palm plantations, responsible for for their success or failure. Rather, the
plantations were regarded as places where remuneration was very low in rela-
tion to work done, and farmers only sought employment there if no other was
available. The PCR also mentioned that the important concept of autonomous
cooperatives was jeopardized by the fact that the cooperatives did not
receive an adequate share of the value of oil palm plantations. With a price
of CFAF 5 per kg of ffb (37Z of the net oil revenue), they could not
adequately remunerate the cooperators'labor nor repay their debts.

1.26 The PPAR pointed out that SONADERhad proven a remarkably effective
institution and that an unusual feature of the project was that it had been
prepared and executed by a Beninese corporation, a completely Africanized
organization, and with very little technical assistance. However, a recent
Government decision to give up the integration concept and to have two dif-
ferent a encies (CARDER for annual crops, and SONADER, now called
SOBEPALH,_3/ for oil palms) intervening in the project area was a matter of
concern for the future of the project.

1.27 Finally, the PPAR mentioned that insufficient knowledge at apprais-

al of local conditions and overoptimisticassumptions of labor avail-
ability had resulted in difficultieswith the maintenance of oil palms and an
overestimation of the benefits that the farmers could derive from the
proposed annual crop system. Subject to labor constraints, farmers had not
assessed the system in terms of its return per hectare- in which it was
superior to the traditional system-but rather in terms of its return per day
worked, in which its superiority remained uncertain and probably smaller.

II. AGRICULTURAL IMPACT

2.01 On completion of the Hinvi Project, reports from the Bank and the
other agencies were not unanimous on the subject of results. Whether
regarded as a success or a failure, however, the project was at all events a
particularly interesting case and an original development venture that
merited close attention. Now, five years after physical completion, it is
clear the project is a major economic and social failure, the manifestations
of which are examined below and the causes in Chapter III.

Oil Palm Program

2.02 At appraisal, since climatic conditions in the Hinvi region were

not ideal for the oil palm, potential crop yields on a plantation in full
productionhad been estimated at 8 t/ha. The Appraisal Report indicated that
yields would be approximately 50X of the yields obtained in the parts of

3/ SONADER was renamed SOBEPALH, but its functions were not significantly
changed.
 -7-

Africa most favorable to the oil palz 4 / and 30% of those obtained in South
East Asia. However, as rainfall was below normal levels during the early
years of the planting process, potential yields were revised down, first of
all to 7 t/ha and then to 5 t/ha. In actual fact, average yields between
1973 and 1982 were around 2 t/ha, varying from 1.2 t to 3.1 t depending on
the particular cooperative (see Annexes 2 and 3 for details); this was 25% of
initial yield estimates and 40% of corrected estimates. Generally speaking,
the cooperatives in the south of the project region showed the worst results
and those in the north the best. Of the ten cooperatives set up under the
project, the average annual production figure for the years 1980, 1981 and
1982 was 13,437 tons of ffb, roughly 28X of the initial estimates.

2.03 The low yields are in part a consequence of the low rainfall, which
for some years now has been characteristic of this part of Africa, but more
than anything else they reflect the neglected condition of the plantations,
which receive virtually no regular maintenance and give a very poor output.
The spread of grasses and weeds and the lack of pruning makes both harvesting
and the transportation of ffb to collection points very difficult, and
explains why a proportion of the ffb are not even harvested. Seasonal labor
shortages also explain why ffb are not harvested for weeks, even several
months in some cases. Finally, thefts of ffb, whether from the plantations
themselves, from collection points or during transportation, are consider-
able, so that a reduced volume of fruit reaches the mill, which then operates
at a third or half of its capacity.

Annual Crops

2.04 The annual crops program was designed to replace extensive with
intensive cropping. Before the project was launched, the average family
landholding was 6.2 ha, about 2.8 ha of which was put under crops each year
and then left to lie fallow for some years. Natural oil palm stands and
perennial crops (coffee, cocoa, bananas) were also present. The result of
crop intensification was expected to be that a reduced area (1.4 ha net)
would allow higher output than the then usual holding, thanks to the elimina-
tion of fallow areas, introduction of a double-cropping system (a
grain-legume rotation) and improved unit yields owing to the use of
fertilizers. Crop intensificationalso called for clearing of any remaining
forest growth and uprooting of both perennial species and naturally growing
oil palms.

2.05 It proved impossible to carry out this ambitious program.

Restricted to a minimum surface area, farmers first took care of their basic
food needs by growing maize, which became a virtual mono-crop on the 10 ZOCAs
making up the project area. The failure to rotate crops, combined with
inadequate technical supervision and assistance and either the lack or
excessive cost of fertilizer, led to exhaustion of the soil, a drop in yields
and a necessary return to the traditional fallowing system-all this even

4/ It is worthwhile noting, however, that yields in Western Africa are

rarely more than 12 t ffb/ha.
 - 8 -

though family holdings had been reduced to a quarter of their former size.
Animal traction was introduced and, though successful at first, failed in the
end because farmers, since they had no access to credit, were unable to
replace animals or equipment. Altogether, yields were no better than 30% of
the target figures. In addition, the old perennial crops and natural oil
palm stands, important sources of income, had disappeared. While the area
enjoyed a surplus of food products prior to commencementof the project, it
is now by and large a deficit area. Many members of the cooperativeshave
had to lease land outside the project zone in order to meet household food
needs.

Stockraising

2.06 This component of the project was designed to produce income for
the cooperatives from beef sales on the local market and sales of traction
animals to cooperative members, the necessary pasture being sown on the land
put under oil palms. SONADER and USAID funds were used, beginning in 1966,
to establish a herd of approximately400 head, expected to increase to 1,000
by the early 1980s. In 1983, the size of the herd was in fact 322 head (it
had reached 560 in 1976/77), with a high proportion of old females and too
few young ones. Deterioration of pastures, a lack of supplementaryfeed,
periodic difficulties in watering the animals and generally poor animal
health were the main reasons for a high mortality rate in the herd and its
drop in size. The stockraising component was the responsibilityof SOBEPALH
alone (the cooperatives having no role at all in herd management); it has
been running at a loss for the last five years.

Reforestation

2.07 The aim of the reforestation component was to offset the loss of
firewood caused by clearing operations and to produce income for the coopera-
tives from the sale of teak building poles. A total area of 1,000 ha was
planted, as projected, and management of this part of the venture, like the
stockraising component, was the responsibility of SOBEPALH. Repeated
refusals on the part of SOBEPALH to carry out cutting operations meant that
cooperative members themselvesdid so clandestinelyin most reforestedareas.

Conclusion

2.08 The agricultural impact of the project is considerably less than

was projected at appraisal or later, at the time physical implementationwas
completed. This general deteriorationover the last five years has affected
all aspects of the project (oil palm stands, annual crops, stockraisingand
reforestation).
 -9-

III. MAIN REASONS FOR PROJECT FAILURE

3.01 At the outset, the Bank recognized two constraints: the climate
was just barely suitable for the oil palm, and the intended collectivist
approach promised to be difficult. However, the Appraisal Report concluded
that the climate was suitable enough and that the effectiveness of SONADER
would overcome the human problems certain to be created by the establishment
of cooperatives. In practice, the natural environment, whether climatic or
human, proved much more unfavorable and hostile than foreseen.

3.02 Hindsight shows that there were four major causes for wide
differences between initial expectations and final results: Mi) under-
estimation of the constraints inherent in the natural environment; (ii)
insufficient knowledge of the social and human context, which meant that an
inappropriate development approach was used; (iii) the failure of the
cooperative system; and (iv) management errors on the part of the
institutions responsible for the project.

A. Under-estimationof Constraints

3.03 Averaging 950 to 1,000 mm in the south and 1,000 to 1,100 mm in the
center, rainfall has been below the figure of 1,170 mm projected for the
whole project area. Only in the northern zone did the rainfall of 1,100 to
1,200 mm come close ta initial estimates. Two additional factors also played
a part: the lengthening of the dry season and annual variations that were
more marked than expected. It is now clear that climatic conditions in the
Hinvi region were over-estimated initially and that project appraisal
personnel were not aware of the differences between the north and south
zones. It is also evident that the water shortage was worse from 1974
to 1981 than from 1966 to 1973 (see Annex 4). The climate therefore proved
to be even less suitable than had been thought originally,which explains why
average potential oil palm yields, first assessed at 8 tons of ffb/ha, were
later scarcely above 5 or 6 tons/ha. It is also very clear that poor rain-
fall cannot provide a complete explanation of the average yields of 2 tons/ha
recorded for the last few years and that other limiting factors prevailed
(para. 3.16-3.17).

3.04 The quality of soil was grossly overestimated, as well as the

feasibility of substituting intensive doublecropping for the traditional
shifting cultivation. The technical package, including the use of organic
and mineral fertilizers, strict crop rotation and improved cropping tech-
niques, had been successfully tested in research stations. It proved
impossible, however, to quickly introduce on a large scale. Increasing the
cropping intensity without fertilizers or crop rotation finally led to soil
degradation, low yields and the need to go back to the traditional shifting
cultivation system.
 - 10 -

B. Social and Human Environment

3.05 The social and economic characteristics of the Hinvi region were
sunmmiaized in the Appraisal Report: high population density (62 inhabitants
per km2 ), growing by approximately 3Z a year; dispersed settlements; smallish
holdings (averaging 6.2 ha in size, with 81% consisting of less than 10 ha),
a quarter under crops and the rest fallow.

3.06 It was the size of the fallow area which seems to have determined
the technical package of the project: intensive cropping, without fallow, on
25% of the initial landholding would, theoretically,bring its owner as much
income as he had before the project, at the same time making land available
for the establishmentof palm groves and for redistribution to landless farm
workers.

3.07 This line of reasoning proved to be simplistic and predicated on

misperceptions regarding the pre-project organization of family land-
holdings. Annual crops certainly took up only 25% of a holding, but the
remaining 75% was not left unutilized. Natural stands of oil palm
(approximately 15/ha) were an important source of income for the women of the
rural population, who produced palm oil; in addition, they provided wood for
fuel, crafts and building. Perennial crops (coffee, cocoa, kola nuts) were
also quite significant on the average holding. Finally, the system of
fallow and rotating crops was dictated by the fragility of the soils and the
on-farm shortage of organic matter. The economic and social organizationof
the traditional family smallholdingwas characterizedby diversifiedagricul-
tural production, which gave a surplus and meant that there was an equitable
distribution of work and income between men and women (approximately 197
days/year each).

3.08 The project was going to alter traditional methods of farming

completely and disrupt the existence of the smallholder family, which would
be confined to a reduced area denuded of the old perennial crops and would
find itself the obligatory holder of shares in a palm oil cooperative. Such
a drastic change was obviously going to be unwelcome to the populationunless
it brought immediate and substantial advantages. However, what happened was
the exact opposite. Technical failure of the annual crops and the low income
derived from the palm groves led to a general impoverishment of the popula-
tion (para. 4.05) and simultaneous destruction of the traditionalpattern of
life (paras. 5.03-5.05).

3.09 The obligatory regrouping of farmers into producer cooperativeswas

not viewed as an insurmountable difficulty in the Bank's Appraisal Report,
since it rested on Beninese legislation dating from 1961 and already in
force. No critical analysis of the new system or the likelihood that it
could be successfullyused in the Hinvi region seems to have been made by the
Bank at the time of appraisal. It became apparent, however, that the compul-
sory cooperative system had no basis in any national or local tradition,
contrary to assertions made at the time in order to justify its introduction
(see Annex 5). The customary practices of 'donkpa- and ajolu' were ways of
organizing community work and the 'tontine' a mutual savings society. But
all these traditional forms of community activity and reciprocal help were
based on individual property rights. What belonged to the community was
 - 11 -

effort and work, but not the means of production or land. Pre-project
studies showed that 64% of smallholders had obtained their land by in-
heritance and 36% by purchase, so that land was an individual saleable good
and not a collectivelyowned one.

3.10 Project cooperatives were set up on a compulsory basis which

involved virtually expropriation of land and meant that cooperative members
did not all enjoy the sariestatus. Group A members were smallholdersobliged
to subscribe capital to the cooperative in the form of their land. In
exchange, they received shares whose value (CFAF 30,000 each) and the
interest they produce (3% per year) have never been adjusted.5 / MIoreover,
they had no right to vote in the cooperatives and no share in their profits.
These factors together constituted a major injustice in the eyes of the
members of the A group, who made up roughly 80X of the original members and
whose hostility to the project was evident from the outset. Since they con-
sidered they had been plundered,very few (only 4%) of group A members agreed
to work on the project and therefore to join the AB category. The massive
desertion from the A group meant that a salaried labor force had to be
recruited, who would later on form the so-called users groups of the
cooperatives.

3.11 In contrast, the group B members of the cooperatives were the

favored beneficiaries of the project: in exchange for 200 days of work a
year, they received a salary equivalent to 45Z of the annual minimum wage, an
interest-bearing share in the cooperative (value at CFAF 30,000), voting
rights and the possibility of access to profit-sharing. Since the B group
constituted only 20% of the membership, the system favored and condoned the
domination by the minority over the m.Jority of members.

3.12 In retrospect, it would appear that the approach of cooperative

development suffered from the very beginning under a doub'lehandicap: (i) it
was not in keeping with the soclal and economic characteristics of the
region6 / and (ii) it alienated the majority of members from the very start.
This error alone largely explains the failure of the cooperative system and
the deteriorationof the project.

C. Failure of the Cooperative System

3.13 Not only did the cooperative system rest on the unsteady founda-
tions described above, but it also never had any real possibility of
functioning. Certainly, the Boards of Directors were made up solely of B and
AS group members, elected by the cooperative. The Annual General Meetings,

51 In 1983 dollars, these values were approximatelyUS$80 for a share and

US$2.4 in annual interest.

6/ Like so many other projects which have attempted a producer cooperative

approach copied from foreign models. The following OED Reports, among
others, are of interest: No. 3959 (Colombia: Atlantico Impact Evalua-
tion Report) and No. 3514 (Senegal: Second Agricultural Credit PPAR).
 - 12 -

which consisted of all members, convened once a year. However, the role of
these two bodies has always remained ambiguous and been limited to protecting
the interests of members vis-a-vis the central authorities and to the
distribution of profits and dividends whenever the cooperatives had a surplus
for the year. In practice, each cooperative was managed by its director,
appointed by SOBEPALH and assisted by an administrative staff of ten. 7 /
This group, paid by the cooperative but not under its control, provided the
real management of the cooperative, being responsible as well for the
programming and execution of work.

3.14 On the national and regional planes, it was SOBEPALHwhich estab-

lished production work norms, fixed the prices payable to the cooperatives
for their deliveries of ffb, decided salaries and provided the cooperatives
with the necessary accounting services. The cooperatives were therefore such
only in name, and remained subject to the central authorities acting through
SOBEPALH.

3.15 It was stagnation in the wages paid for labor and the price paid
for ffb that would rapidly point out the fiction on which the cooperative
system was based. Although the daily wage, CFAF 125 in 1968, was to rise to
CFAF 200 by the end of the planting period, the increase was granted by
SOBEPALHonly in 1978, whereas wages had risen to CFAF 350 elsewhere and as
high as CFAF 750 on State farms. Moreover, the price paid the cooperatives
for their deliveries of ffb was held at CFAF 5.68 for eight years (1975-82)
even though the cost of inputs billed by SOBEPALH to the cooperatives
increased continually. Producer prices, which in 1972/73 amounted to 40% of
the export price of palm oil, were equivalent to only 19% in 1981/82 (see
Annex 5). Any hope of dividends the members of the cooperatives might have
had therefore became more and more remote.

3.16 Low wages and low or nonexistent dividends led to gradual desertion
by the group B members of the cooperatives, whose shares (CFAF 30,000 each)
had not been revalued either. Like their group A counterparts, group B
members have now lost all motivation and no longer work on the plantations
except intermittently. Moreover, since the work is poorly paid, they cut it
down to a few hours a day and their output is low. For the most part, they
either concentrate on their own annual crops, look for work elsewhere or
emigrate. Given the defection rate, as high as 72% from group A and 65% from
group B (see Annex 7 for details), the project resorted increasingly to
salaried laborers, who now go by the name of users" in the cooperatives and
have obtained voting rights. But at the wage levels offered, labor is more
and more scarce and erratic; it is only absolute necessity that drives
laborers to work on the plantations when there is no work elsewhere, particu-
larly as the work is considered hard and dangerous by laborers. Under the
circumstances, the manpower shortage is chronic; the majority of laborers

71 Two extension agents for maintenance and the harvesting of ffb; 4 team
leaders; 1 or several foremen or caretakers; 1 cyclist for liaison with
the oil mill; 1 collection supervisor; 1 tally clerk; and 1 first-aid/
veterinary assistant.
 - 13 -

want no more than 1-5 workdays a month and maintenance of the plantations is
neglected.

3.17 Moreover, the theft of ffb from the trees, from collection areas
and during transportationis frequent. The fruit is processed into oil on an
artisanal scale, not only for family consumption but also for sale at three
to four times the official price. For some, this is a way of recovering
assets of which they have been robbed; for others, it offsets earnings that
are too low. The vicious circle whereby low output leads to low producer
prices, which in their turn lead to low wage levels and theft (which
partially explains the low output) has gradually become the norm and taken
the place of the "joyous group work in an atmosphere of friendly rivalry"8/
that had been expected of the cooperatives. The survey conducted in early
1983 for purposes of this impact evaluation report shows clearly to what
point members of the cooperatives feel exploited by the project and regard
the plantations as the property of SOBEPALH and not their own (Annex 8).

3.18 The failure of the cooperative system has often been blamed on the
Beninese Government and particularly on SOBEPALHfor never allowing the co-
operatives their autonomy. It is true that the cooperatives were finally
never more than instruments for land redistributionand reservoirs of cheap
labor and that they were never authorized to govern themselves. However,
SOBEPALH's role as management agent for the cooperatives was intended from
the outset and is clearly mentioned in the Bank Appraisal Report, which
states (para. 6.04) that the cooperativeswere gradually to take over respon-
sibility for their own management, but since they would be financially
indebted to SONADER "the latter would exert a high level of direct control
over them for the first 25 years of their existence." The Report further
states that SONADER would also have the power to "dissolve the cooperatives
in the event of unsatisfactoryperformance."

3.19 It is therefore clear that there were no plans to make the coopera-
tives autonomous in the short term. However, despite the mistakes made in
connection with the composition of the cooperatives, which were mentioned
earlier (paras. 3.09 and 3.10), one of the few opportunities to save the
cooperativemovement would have been to give it a certain degree of autonomy
as soon as possible and to vest the Boards of Directors and Annual General
Meetings with real decision-makingpowers. This was not done and there were
no plans to do it until years had passed. The result is that the coopera-
tive, as far as its members are concerned, is an extension of the state in
which they feel they have no say and from which they can expect no benefits.

D. Management Errors

3.20 SONADER, which became SOBEPALH in 1975, was described in the Bank's
Appraisal and Project Performance Audit Reports as an effective institution
with wide experience in agricultural development and the organization of

8/ -Le collectivisme: Instrument du Progres Economique," France-Dahomey,

January 1960.
 - 14 -

cooperatives. Five years after physical completion of the project, however,

the situation looks quite different.

3.21 It was in 1976 that SOBEPALH's position began to deteriorate. The

initial cause was a financial crisis, reflected in the negative balance
sheets for 1977 and 1978 and ascribable mainly to poor, and then very poor,
palm grove output (105,000 tons in 1975/76 but 69,300 tons only in 1979/80,
from all plantations supervised by SOBEPALE). Failure on the part of the
State to reimburse investments financed in the first instance by SOBEPALHand
the fact that the latter was obliged to absorb three old and unprofitable oil
mills with their full complement of personnel increased the agency's deficit
even further. It was the precarious nature of SOBEPALH's financial position
which initiated the process of deterioration. By underpaying for ffb and
labor, despite higher prices for palm oil and inflation, SOBEPALHdistorted
prices in order to save itself; at the same time, however, it condemned the
project to failure sooner or later. The project illustrates the importance
of a fai'r price policy and the danger of Government interference with market
prices for farm-inputs and products.

3.22 The second underlying cause of the financial crisis is the

increasing bureaucratization of the agency: its staff has grown in size from
100 to over 1,500 in 12 years. The decision-making center is at head-
quarters, in Porto Novo, where there is little contact with the field owing
to the lack of means of communication and travel. Moreover, SOBEPALHdoes
not have the option of dismissing surplus personnel, and its costs rise
constantly. Equipped with facilities and personnel for the processing and
sale of 180,000 tons of palm oil per annum, the organization produces no more
than 70,000 tons. Although more and more of a bureaucracy, it produces less
and less, and finally personnel costs are absorbing most of the value added
in the oil palm sector (para. 4.04).

3.23 Equally serious has been SOBEPALH's very attitude to the coopera-
tives. Far from being in favor of their gradual emancipation, the
organization has held them in virtual subjection and treated them without
consideration. Staff are appointed to the cooperatives by SOBEPALHbut paid
by the members, who, however, remain ignorant of the fact, although this item
represents 30% of the cooperatives' expenditure. Interest is paid to A group
members one or several years late. Some profitable cooperatives do not
receive their share of the profits. In 1981, disputes on questions of
authority between SOBEPALH's mill director and director of plantations led to
a truck stoppage and to failure to collect ffb, the only ones to suffer being
the members of the cooperatives. Excessive centralization of the decision-
making power in Porto Novo and the very size of the SOBEPALHbureaucracy mean
that requests and complaints from the cooperatives are passed on and
considered only after major delays. For instance, cooperatives seeking
approval to buy oil from the mill for household consumption or to cut fire-
wood or to sell cattle have to apply to headquarters, which responds very
slowly, if at all. It is therefore no surprise that the members of the
cooperatives finish by "stealing" what they consider "their" ffb, "their"
firewood and "their" livestock. The relations between SOBEPALE and the
members of the cooperatives resemble those between employer and employee,
 - 15 -

an attitude of grievance, with a trade-union flavor, having become permanent

among members.9 /

3.24 It should be noted nevertheless that SOBEPALU began a serious

attempt in 1981 to improve management of the Hinvi area. Merging of the
directorshipsof the nill and the plantations, which had been separate until
then and the source of frequent conflicts, and general replacement of a daily
wage rate by a piecework rate were two worthwhile reforms. In addition, the
producer price for ffb was raised to CFAF 7 per kilo in May 1982.

3.25 -o conclude, it would appear that some of the factors which explain
the failure of the project-ignorance regarding climatic conditions and the
social context, in combination with a development approach ill-suited to the
human environment-should have been apparent at the time it was designed.
Throughout the execution period, SONADER's good performance and the adequate
wage levels paid to cooperative members masked the ?roject's intrinsic
deficiencies,which made their presence felt only on completion of physical
implemeutation,when the technical packages of the whole venture were seen to
be mistaken. At that stage, it would probably have been possible to remedy
the initial errors partially by allowing the cooperativemovement a chance to
function on a healthy footing and in accordance with its real vocation.
Unfortunately, management errors added a further problem, which compounded
those already in evidence.

IV. ECONOMICAND FINANCIAL IMPACT

Economic Returns

4.01 On completion of the project, the economic rate of return (ERR) was
re-estimated at approximately 5% on the basis of revised production output
figures-7 tons/ha for the oil palm plantings and 50% less than the original
estimates for the annual crops. Actual oil palm output is difficult to
assess because of thefts of ffb and the existence of parallel markets for
palm oil; in any case, it is well below both the initial estimates and the
revised estimates given in the Project Performance Audit Report. As far as
the annual crops are concerned, the low cropping intensity (around 62%
instead of the 200% envisaged) and poor yields mean that production has
hardly reached 30% of the initial projections. Globally, the project ERR can
only be nil or negative, since sensitivity tests conducted at the time of the
Project Performance Audit Report indicated that the ERR would fall to 2.5%
and 0% with oil palm output figures of 6 tons and 5 tons per hectare respec-
tively.

9/ The members of the cooperatives attempted to set up a trade union in

1980, although it was rejected on the legal grounds that they were not
employed by SOBEPALH; among other things, they were demanding annual
leave and social benefits.
 - 16 -

4.02 In addition, the direct economic effects of the project have been
calculated by FAC, which arrived at the following conclusions: the value
added accruing from it represents approximately 0.18% of GDP; the tax
revenues derived from it total approximately 0.27% of all tax revenue; it has
helped reduce the trade deficit by about 1%. Clearly, therefore,the impact
of the project on the Beninese economy has been negligible.

Financial Returns from the Cooperatives

4.03 Examination of the financial balances of the cooperatives (details

in Annex 9) indicates that there was a global and continuing deficit until
1981, when improved management practices in the Hinvi area seem to have taken
effect (para. 3.21). Some individual cooperatives showed positive balances
from time to time and one of them (the Agbotagon unit)lO/ nearly all the
time. For the majority, their deficit position signifies increasing
indebtedness to SOBEPALH as well as an absence of dividends, something which
precludes payment of any labor bonus, payment of any remunerationon B shares
and any possibility of going ahead with the collective investments envisaged
initially. The low wages paid, which should have an advantageous effect on
cooperative balance sheets, are more than offset by the low producer price
SOBEPALH pays for ffb deliveries and by the costs of maintaining SOBEPALH-
appointed management/administrativepersonnel, which are borne by the
cooperatives.

4.04 FAC, which incorporated a study of the impact of the project on the
Beninese economy into its ex-post evaluation report, concluded that gross
vaije added amounted to CFAF 424.9 million, of which CFAF 89.6 million (21%)
reverted to the cooperatives and the remainder (79Z) to the SOBEPALH
complex. The report adds that this "allocation of value added between the
cooperatives and SOBEPALH is not a matter of mill performance being better
than that of the cooperatives; it is only the ffb price paid to the coopera-
tives which determines this uneven division." Furthermore, the cooperative
workers, who provide the largest body of labor for the Hinvi operation,
receive only 26% of net value added, while management/administrative
personnel receive 12%, support structure personnel 10% and mill personnel
30%. At all events, 78% of project value added goes into the remunerationof
personnel.

SmallholderIncome

4.05 The Bank's Appraisal Report estimated that a farm family, prior to
the project, could attend to its own food needs and produce a surplus of

lO/ Agbotagon lies in an area where rainfall is good. Moreover, data in-
cluded by FAC in its evaluation report on the Greater Hinvi Project
indicate that the members of the Agbotagon cooperative are almost all
residents of the village of that name. Only five village houses are
situated within the expropriated area, while in other cooperativesthis
figure is between 40 and 50; this fact explains why thefts of ffb are
less frequent there than elsewhere.
 - 17 -

approximately CFAF 12,000 (in 1966 prices) per year. As a result of the
project, money income would increase to CFAF 60,000, with CFAF 42,000 coming
from annual crops, CFAF 16,000 from 80 man-days of labor on the p? ntations
and CFAF 1,800 from interest on A and B shares. Translatedinto 198L prices,
money income was therefore estimated at approximatelyCFAF 48,000 pre-project
and CFAF 240,000 post-project. However, as the FAC study shows, the annual
money income of a family belonging to a cooperativenow varies between CFAF
36,000 and CFAF 44,000 (for 40 and 80 manrdays of labor respectively on the
plantations). This figure, no more than 16% of the initial projections,
indicates a significant impoverishment of rural families by comparison with
their pre-project situation.)-/

4.06 This impoverishment of the Hinvi population is reflected in the

responses given by 48 members of cooperatives interviewedin early 1983. The
heaviest losers are clearly the holders of A shares. For them, tne loss of
their land can in no way be compensated by shares in a cooperative, the
valuation (CFAF 30,000 each) and paltry interest rate (3% per annum) of which
have remained unchanged for 13 years.1 2/ But B group members have also
suffered loss, since their cooperative shares generally produce no interest
and their labor is underpaid. "Users," who have now become the majority in
most cooperatives, derive no more from them than the possibility of casual
work or a surplus of resources when their own farmworkhas been completed.

V. SOCIAL INPACT

5.01 The project was designed not only to increase the ircome of the
Hinvi population but also to improve their living conditions by regrouping
the typical dispersed settlements into villages and providing medical and
schooling facilities. To that end, village areas averaging 50 ha per co-
operative were reserved. SONADER was to build the access roads and construct
buildings to house its employees,while the Governmentwas to finance and set
up the social infrastructure. The assumption was that the members of the
cooperativeswould establish themselvesspontaneouslyin these rural centers,
where they would find all the advantages their scattered dwellings had
previously kept them from. In actual fact, the end result was quite
different: roads and housing were built by SONADER, but the expected social
infrastructurenever materialized;the smallholder families have remained in
their old houses, scattered throughout the project zone and its palm groves,
this last factor being something which facilitates thefts and clandestine
harvesting of ffb.

11/ In addition, FAC considers that family income pre-project was underesti-
mated in the Bank report and that current income, based on SOBEPALH
statistics,is overestimated.

12/ The market value of a hectare of land today is CFAF 80,000-120,000.

 - 18 -

5.02 Two other social activities were begun in order to improve living
conditions. One first-aid/veterinaryassistant was appointed per cooperative
(and paid by it), with the responsibility of providing care for both the
workers and their animals; however, since they have received no medical
supplies for several years, these assistants have been unable to exercise
their function, although the cooperatives have continued to pay them.
Literacy instruction,originallywelcomed by the population, has been dropped
in favor of other courses through which participants receive World Food
Program rations. FAC surveys have demonstrated that on the whole health and
schooling have not progressed since 1966. Illiteracy is still 84% on average
and 92% among women. The only successes in this sphere have been achieved by
the Agbotagon and Goulo cooperatives,which have managed to strengthen both
school and health infrastructureswithin their jurisdictions.

5.03 As noted earlier, the project caused a radical change in the

traditional mode of living of the population, which has grown by more than
44% in 13 years (at an annual rate of 3%), from 36,000 to 52,000. This
increase has been uneven, however, and in parts of the zone the population
has declined significantly. Furthermore, the adult male population is
declining by comparison with the number of women, children and old people,
indicatinga particularlyhigh emigration rate of men (Annex 10). (According
to surveys made in conjunction with this study, certain communities absorbed
large numbers of persons expelled from Nigeria in early 1983). It is clear
that the disruption of the social status quo by the project has not been
offset by the creation of attractive work opportunities,so that nothing has
been able to prevent the rural exodus and emigration.

5.04 The project has had a particularly adverse effect on the female
population, women in fact being its main victims since the very beginning.
Because of the reduction in the size of the average family holding, most
women have lost the use of the plot which, under the traditional system, they
cultivated for their own profit. This disappearance of natural oil palm
stands and fruit trees has deprived them of a major part of their craft-
producing and trading activities. The manufacture and sale of palm oil,
which had been one of the traditional occupations of women in the Hinvi
region, has now become a clandestine operation dependent on stolen ffb. (In
theory, it is still possible to purchase ffb from the mill, but authorization
must be obtained from SOBEPALH headquarters,which may take months.) Total
clearing of the land has wiped out the sources of the fuel wood required for
cooking, and reforestation operations by the cooperatives have not yet
provided the expected replacements; collecting wood, traditionally women's
responsibility,has therefore now become very arduous work. The carrying of
water, another job falling to women, has not been made any easier, since the
wells initially planned for the village reserves have never been built.

5.05 Deprived of their traditional activities, women have begun to work

more and more in the agriculture sector, in which in the past they occupied
only a modest place. Their status is increasingly that of members of the
work force; today they undertake nearly half the work of maintaining and har-
vesting the oil palm, at wages still below those earned by men. They do this
kind of work only out of necessity and on an irregular basis. It should also
 - -

be noted that, as a rule, women do not form part of the Boards of Directors
of the cooperatives and no women are found among their managerial/admini-
strative staff.

VI. CONCLUSIONSAND OUTLOOKFOR THE FUTURE

6.01 In 1983, the year when the project was expected to have reached
full production, it appears to be a major economic and social failure. Five
years ago, there was still hope of success in institution-building and in the
social area, despite unpromising economic results; the original concept of
the project, which envisaged a combination of benefits from agrarian reform
with benefits from greater productivity per capita and per unit of surface,
still looked promising. After so many failures in the sphere of collective
agriculture, the project seemed to indicate that success was at least within
reach.

6.02 Hindsight shows that financial flows during the investment phase
temporarily concealed the two main defects in the project, ignorance of the
natural and human environment and an inappropriate development strategy. For
those few years, the wages paid in the course of implementing project invest-
ments offset the losses sustained by the farming population. Promises of a
better future were an encouragement to participate. For some individuals,
access to collectively-held property seemed preferable to the lot of the
landless farmworker. For others, the imperfectionsof the cooperative system
were the errors of youth, which time would correct. The true facts, however,
are brutal. The Einvi region is now impoverished: all population groups in
the project zone have sustained losses, and the only real beneficiaries of
the project are clearly SOBEPALH's almost 1,500 employees, whose salaries are
guaranteed whatever happens and whatever the outcome of their actions. The
transfer of resources from a poor rural population to the civil service was
obviously not the goal of the project.

6.03 The recent studies of the Hinvi project have all led to the same
adverse conclusions and all propose the same remedy, namely improvement of
SOBEPALHmanagement and the granting of management autonomy to the coopera-
tives. The latter is regarded as essential, the expert opinion being that
the cooperative concept has been distorted, has never had a chance to
function properly and has encouraged irresponsibilityamong the members them-
selves. Surveys carried out in the context of this impact evaluation have
shown that some members of Boards of Directors are firmly convinced that they
would have performed better than the supervising agency, would have been
capable of getting people back to work, preventing thefts and producing
profits for their cooperatives.
 - 20 -

6.04 In the present circumstances, there is indeed hardly any alternar-

tive except to cut back the role and exorbitant cost of SOBEPALH1 3 / and to
foster self-management by the cooperatives. However, there can be no hiding
the fact that the obstacles are formidable. Undoing the damage done by
SOBEPALHwould mean meeting a long list of grievances held by the members of
the cooperatives-increasing wages by 200 to 300%, revaluing the A and B
shares and increasing the interest rates associated with them, paying
dividends and interest which have been unpaid for the last ten years,
increasing the producer price for ffb significantly, declaring a moratorium
on the debts of the cooperatives and removing unproductive members of their
managerial/administrative staff. Moreover, group A members would undoubtedly
question the methods used to expropriate their land and the extent to which
they have been discriminated against. Finally, in a self-managed coopera-
tive, what would be done with the users,- actually casual wage-earners
invested with a right of participation following the defection of the real
members? And what steps would be taken to resolve the problem of plots
intended for annual crops but which are too small to provide sustenance for
one family? In short, the risk of conflicts between members of cooperatives
and the State, and more especially between members themselves, is very high
and could make self-managementextremely difficult, although it is now said
to be the only possible remedy.

VII. LESSONS LEARNED FROM THE PROJECT

7.01 By and large, the nearly 40 oil palm development projects financed
by the Bank in 13 countries have so far been relatively successful (Annex
11). Serious failures have been rare in the sector, and this is why the
Hinvi project gives cause for reflection, may be usefully compared with other
projects of the same type and teaches important lessons.

7.02 The first lesson is that it is dangerous to launch an oil palm

operation in a zone which is both only marginally suitable from the viewpoint
of climatic conditions and relatively heavily populated. It was known from
the outset that yields were likely to be low and unreliable, but, as is often
the case, things were more serious than had been thought. If the risk is
worth taking in uninhabited or only sparsely populated regions (the case with
certain projects in Cameroon and Ivory Coastl4 /), it becomes too great when
the inhabitants number around 100 per km2, people whose livelihood may be
seriously jeopardized.

13/ As part of the move to reform the oil palm sector in Benin, the Govern-
ment dissolved SOBEPALH at the end of 1982, entrustingmanagement of the
sector to SONICOG (Societe nationale pour l'industrie des corps gras).

14/ Refer to the Impact Evaluation Report on oil palm and coconut projects
in Ivory Coast (Report under preparation) and the PPAR on the CAMDEV and
SOCAPALM projects in Cameroon (OED Report No. 1752).
 - 21 -

7.03 ln addition, family landholdings in heavily populated zones are

very likely to be small. Therefore, putting large areas under oil palms
crowds out other crops, frequently food crops to which the African small-
holder will generally give priority. In the course of its massive introduc-
tion of the oil palm into the heavily populated Hinvi region, this project
reduced the average size of individual holdings, upset the food-producing
equilibrium of the population and from the outset seriously disturbed the
social basis of the community. Moreover, these adverse effects were worsened
by under-estimationof the benefits smallholders drew from their fallow land
and by incorporationof completely unrealistic technical packages in connec-
tion with annual crops. These negative factors added up from the beginning
to a serious handicap to the project. By comparison, the satisfactory
results generally obtained with oil palm (and rubber) projects in most of the
other countries concerned (including Malaysia, Indonesia, Ivory Coast,
Cameroon, Ghana, and Papua-New Guinea) can be traced very largely to the fact
that plantation zones were completely, or very nearly, unpopulated. This
being so, the projects could not cause serious economic and social dis-
turbances,while the technical difficultiesencountered with some of them had
no adverse effect on population.

7.04 The second lesson learned from the project concerns the importance
of the choice of development method and of the approach to the target popula-
tion. The major question posed by the Hinvi project is this: once the deci-
sion was taken to launch an oil palm development project despite the con-
straints inherent in the natural environment, was the cooperative approach
used the right one? As noted already, the principle of the producer coopera-
tive had no basis in any local tradition and was in fact modeled on systems
in force in other countries. Furthermore, Bank experience with producer
cooperatives, especially in Africa and Latin America, had already demon-
strated the limits and dangers of the system when this project was appraised
in 1969. While voluntarily organized service cooperatives (dealing with
agricultural credit, provision of inputs, marketing, etc.) have often been
successful, imposed producer cooperative arrangements have generally failed
badly. Abandonment of the concept of private property and the pooling of the
means of production have rarely been looked on with favor by smallholde-rs
anywhere.

7.05 The manner in which the Hinvi cooperativeswere formed introduced

additional risks of failure. Land belonging to group A members was expropri-
ated under conditions that under any circumstances could not approximate
adequate compensation. Excluding group A members, by and large the majority,
from the cooperative organizationsconverted them into a force systematically
opposed to the cooperative principle. The tight control exercised by
SOBEPALH, which allowed the cooperativesno opportunity to function normally,
undermined all hope of fostering a cooperative spirit. Finally, the paltry
wages and very poor ffb prices imposed on members of the cooperatives
provoked general hostilitv to a system that apparently made SOBEPALH into the
sole beneficiary of the project.

7.06 Experience gained from other projects elsewhere in the world shows
that different means of developing the oil palm in Benin were available.
 - 22 -

Other Bank-financed oil palm projects have taken one of three main develop-
ment approaches: State farms (especially in Zaire and Cameroon), nucleus
estate plantations surrounded by outgrower plantings (mainly in Indonesia,
Ivory Coast, Ghana, Liberia and Nigeria) and establishment of small planters
in newly cleared zones (the so-called 'settlement" projects, numerous in
Malaysia, Papua-New Guinea and Indonesia). Since there was hardly any
uncleared virgin forest in Benin, the second formula would probably have been
the most suitable.

7.07 Had that approach been selected, the estate plantations-which

serve as the development core and produce the minimum crop to justify a
processing plant-could have been established by SONADER/SOBEPALH either on
State land or on privately-ownedland expropriatedin the proper manner. The
oil mill would have been built at the center of this agro-industrial
complex. The outgrower plantings would have been established with assistance
from the project authority by smallholders living adjacent to the estate and
on only a part of their land. Since they would have participatedin the pro-
ject on an entirely voluntary basis, the majority of the social problems
which dogged this project would have been avoided: the status of women would
have been better protected; the food-supply balance would not have been dras-
tically altered; wages and prices would have kept up with market levels; and
SOBEPALHwould have focused its management practices on remaining competitive
with the parallel market in palm oil. Obviously, the handicap of unfavorable
climatic conditions would have been the same, but a drop in production output
to six or seven tons of ffb per hectare would still have kept the plantations
financially viable even if the project retained only marginal economic impor-
tance to the country as a whole.

7.08 The Hinvi venture raised a third and equally important considera-
tion: the future life of a project and the Bank's possible role in it once
the investment period is over. At Hinvi, as in most cases, the Bank's role
came to an end when loan proceeds were entirely disbursed. According to Bank
practice, a project is then regarded as complete and is no longer supervised;
the final act is the issuance of the Project Performance Audit Report some
months after the investment process has come to an end. The present impact
evaluation,however, demonstratesclearly that the Bank could and should have
had an active role at Hinvi during the years following 'completion." One of
the Bank's last recommendationswhile it still had a voice in the project was
that ffb prices and wages should be increased so as to break the vicious
circle then just forming. No action was taken on the recommendation. The
same went for the wish-expressed on several occasions- to see more autonomy
granted to the cooperatives. However, completion of the project broke off
all dialogue and put an end to the Bank's role in it.

7.09 Looking back, it would seem that projects should not be placed
totally outside the Bank's field of attention once they are considered com-
plete. A project is not really complete until it has accomplished its objec-
tives. When this is not the case, the fact should be more clearly acknow-
ledged in the dialogue the Bank maintains with the Borrower through its
economic and sector work.
 - 23 -
Annex 1
Annexe 1

IMPACT EVALUATIONREPORT/RAPPORTD'EVALUATIOND'IMPACT ECON0MIQUEET SOCIAL

BENIN: HINVI AGRICULTURALPROJECT/PROJET AGRICOLE D'HINVI

(CREDIT 144-BEN)

Land Use by Cooperatives/

Superficie des terres mobilisees par les dix cooperatives
(hectares)

Cooperative/ Oil Palms/ Annual Crops/ Village Reserve/ Reforestation/ Pasture/ Total
Cooperative Palmier Cultures Zone de village Reboisement Paturage
a huile annuelles

Attogon 610 636 98 - 1,344

Agbotagon 611 600 - 100 - 1,311
Eanafin 601 610 95 100 89 1,495
Koundokpo6 619 675 60 98 - 1,452
Goulo 614 536 60 106 88 1,404
S&dj, 601 660 86 107 - 1,454
Adjan 601 601 60 115 78 1,455
lrpo&-Kpanroun 603 630 - 105 - 1,338
Dodji-Gb8to 622 690 - 105 - 1,417
Dodji-Seha 604 625 100 120 120 1,569
6086 6263 461 1,054 375 14,239
 Annex 2
Annexe 2
IMPACT EVALUATION REPORT/RAPPORTD'EVALUATIOND'IMPACT ECONOMIQUEET SOCIAL

BENIN: HINVI AGRICULTURAL PROJECT/PROJETAGRICOLE D'HINVI

(CREDIT 144-BEN)

Yields per Hectare on Cooperatives,1973-1982/

Rendement a l'Hectare des dix coopgrativespour la periode de 1973 a 1982

Cooperative/ 1973/74 74/75 75/76 76/77 77/78 78/79 79/80 80/81 81/82 Average Yield/
Cooperative Rendement Moyen

Attogon 0,697 2,501 3,558 2,735 1,809 2,543 0,716 1,158 2t946 2,074
Agbotagon 1,950 2,620 5,380 4,040 4,610 2,120 4,146 1,441 1,904 3,149
Hanafin - - 2,078 1,574 2,081 2,571 1,286 1,924 5,264 2,386
Kpoe - - 1,013 1,103 0,392 0,897 0,831 2,187 2,250 1,239
Goulo 2,318 1,875 4,784 1,507 0,835 1,253 1,639 2,250 2,818 2,141
Sgdja - 1,098 4,021 3,030 0,902 2,083 1,509 2,291 2,690 2,203
Adjan - - 1,397 3,076 1,782 2,944 2,463 3,814 5,923 3,057
Kpoe-Kpanroun - - 1,013 1,103 0,392 0,897 0,831 2,187 2,250 1,239
Dodji-Gb6to - - 1,918 1,519 0,428 1,800 0,494 1,338 1,455 1,278
Dodji-Saha 0,704 2,501 1,570 2,346 2,309 1,799 1,201 0,963 4,021 1,934
Koundokpoe - 1,864 2,956 1,822 0,832 1,398 2,142 1,401 2,618 1,879

Source: Cooperative statistical records/Bilandes coopfratives.

Tons of ffb per hectare/tonnesde rpf a l'hectare.

U;nit/Unite:
 -25- Annex 3
Annexe 3
INFACT EVALUATIONREPORT/RAPPORTD'EVALUATION D' IMPACT ECONOHIQUEET SOCIAL

BENIN: HINVI AGRICULTURALPROJECT/PROJET AGRICOLE D'HINVI

(CREDIT 144-BEN)

Yield Curve: Latest Estimates and Achievements

Courbe de Rendements: Dernieres Estimations et Realisations
(for the 14 cooperatives/pour les 14 cooperatives)

Taux/Rate Estimate/
7 RendementlYieLd _stimations
Wtha)

6~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

2 / / / ~~~~~~~~~~~~~~~~a]
isations
O ., | , , , , ,* ,~~~~~ I I
5

5 6 7 8 9 10 11 12 13 14 15 Ann3es

Source: Rapport d'eivaluationretrospective du FAC1

FAC Evaluation Report.
 - 26 -
Annex 4
Annexe 4

IMPACT EVALUATIONREPORT/RAPPORTD'EVALUATIOND'IMPACT ECONONIQUEET SOCIAL

BENIN: HINVI AGRICULTURALPROJECT/PROJET AGRICOLED'HINVI

(CREDIT 144-BEN)

Annual Rainfall Deficit in Pobt/Deficit hydrigue annuel a Pob&

(1966-1981)

1966-1973 1974-1981
Year/ Deficit/ Year/ Deficit
Annee Deficit Annie Deficit

1966 406 1974 541

1967 715 1975 557
1968 344 1976 977
1969 617 1977 971
1970 532 1978 600
1971 876 1979 499
1972 526 1980 365
1973 587 1961 474
Average/
Noyenne 460 623

Source: Review of the Oil Palm Sector, Booker Agriculture

International Limited.
 - 27 -
ANNEX 5
Page 1

IMPACT EVALUATIONREPORT

BENIN: HINVI AGRICULTURAL

PROJECT
(CREDIT 144-BEN)

Social and Economic Characteristicsof Hinvi Region

1. Social Organization

The three ethnic groups inhabiting the Greater Hinvi Region all
possess the same forms of social organization,a characteristicof which is
the fragility of the traditional political power. Outside Togoudo and
Allada, which in the past played an important political role as the centers
of a powerful kingdom from which came the Princes of Abomey, Porto Novo and
Savi, overall political power is held by the religious chiefs, who exercise
the most important social functions. In the exercise of their power, these
chieftain-priestsrely primarily on the chiefs of clans and lineages. It is
the latter who provide political direction for their own groups.

This is a very simple, and sometimes very fragile, type of politi-

cal structure. The lack of a well-organizedcentral political power provides
one explanation of the dispersed settlement pattern commented on in this
report.

The other elements in local social organization are the various

societal links. Instances of these can be seen in two kinds of organization
which bring the inhabitants together outside any rigid political structures:
these are associations of an economic nature that exist for the purpose of
mutual help, and are known as the 'ajolu" and the 'tontine." Found in almost
all hamlets, they are open to the inhabitants of the locality without dis-
tinction of age or sex. Anyone may call on them for assistance with farm
production work or house building, but in return must provide the members
with food and drink.

The ajolu is an agricultural society. It is a fixed group,

organized on the principle of reciprocity. Following a pre-establishedtime-
table, the members gather on each holding by turn to carry out the sam
amount of work. There is neither division of labor nor any collectively-
owned property. The major advantage of the system is the camaraderie and
mutual encouragement associated with teamwork. Ajolu societies in this
region are formed by age group and sex.

The tontine is a savings society and is also of great importance.

Each member pays in a fixed sum at set intervals; following a pre-arranged
drawing order, the sum collected goes to each of the members in turn. The
duration of the tontine and the size of the contributions to be paid in are
decided by the members of the group. The duration may be anything from five
months to ten years, according to need, and a contribution may be anything
 -28 - ANNEX 5
Page 2

from CFAF 100 to CFAF 1000, or sometimes more. There are two kinds of ton-
tine, one calling for a contributionof money and the other for the contribu-
tion of imported alcoholic beverages (rum, gin, whiskey, etc.). In both
cases, the idea is to be able to make investments which exceed the capacity
of an individual.

Tontine societies are extremely important in the rural economy

since they provide the only means of collective saving.

A tontine is organized by a volunteer committee headed by a presi-

dent, one or two vice presidents and a treasurer who enjoy the trust of the
members. A standard fee of CFAF 10 to 20 is paid to the directors of the
tontine as compensation. This detail is noted because it shows how highly
conscious this society is of the notion of remunerationfor services.

The tontine and the ajolu are primary forms of the common pooling
of resources, and provide points around which the cooperative spirit could be
fostered. These forms of mutual help aside, however, the fragility of the
techniques of social and political integration,heavy population pressure and
a dispersed settlement pattern have worked against the development of a
cooperative spirit, having clearly tended to foster individualism. Neverthe-
less, prior to the vote on the legislation of 1961, several articles were
published in different national newspapers in an attempt to vindicate cooper-
ative action.

Two instances may be cited here: an article by the French

sociologist Jacques Lombard which appeared in France-Dahomey for January
1960, under the title Le collectivisme,instrumentdu Progres Economigue;and
another, by the Beninese ethnologist Tidjani Serpos, entitled La cooperative
dans le folklore traditionnel, contes et proverbes.

These authors both refer extensively to the "donkpa.- According to

Jacques Lombard, this instance of collectivizationis 'joyous group work in
an atmosphere of friendly rivalry which puts the group under a type of social
constraintfavorable to output."

The custom of the donkpa is no different from that of the ajolu.

The reality behind both is recognition and conservation of individual
property. In the common pooling of effort, each member of the community can
keep an accurate tally of his advantages.

The cooperative structure first launched by the original SONADER

was a long way from these customary practices, which did not go beyond the
simple framework of groups concerned with mutual help. As groups, they
pooled only effort and labor and not the means of production, which always
remained private individual property. Furthermore, each mutual-help society
enjoyed complete autonomy; it did what it wished without any outside
interference.
 -29- ANNEX 5
Page 3

The farm-management cooperatives, for their part, are

para-administrative structures in which smallholders learn to follow
directives from above. Under this new system, a member of a cooperative,
through the theories and techniques of farming presented to him, begins to
feel disconnected from his old, familiar world. To be a member of a
cooperative means essentially to go back to school. In the circumstances,
the different stages of training and consciousness-raisingthrough which the
members of the cooperativeswere put had the effect of so many constraints,
something which severely jeopardizedthe success of this experiment.

2. Economic Features

The major economic activity in the Hinvi region is farming. Almost

the entire population is engaged in it, even women, who would generally be
drawn more to the other sectors such as trading.

The base for this agricultural activity is land, and the way land
is used is largely a question of how it was appropriated.

According to customary law, the first occupant of a tract of land,

if he has worked it for 10 or 20 years, is regarded as its owner. The land
belongs to the clan, but it is the family which settles the order of ranking
among heirs. By now, almost all the land has been appropriated,initially by
those who established themselves as conquerors at several points in the Aizo
region, thus becoming its masters. This explains why terrain located in the
districts of Agon, Agbotagon, Ouagbo, Hinvi, Attogon and a part of Adjan
belongs to Fon families which originated in Ouagbo or Allada or Abomey.

Starting with this annexation of a good part of the Aizo region by

the Fon, the remaining areas, held collectively by lineages, have been
appropriatedby individuals,usually heads of extended families.

So the landholding pattern is one of small enclaves which pass

constantly from family to family in the wake of matrimonial alliances and
bonds of friendship.

The concept of collective property does not exist in this

environment, except for the zones reserved for housing, where the owner of
the house is the person who has built it.

As a general rule, appropriationof land by family or individual is

effected in this region in one of several ways: by inheritance,gift, lease,
loan, pledge or purchase in kind. All six methods function very well in this
milieu, although pledge, lease and sale appear to be the most widespread
means of transfer.

Under a pledge arrangement, a landowner who needs money offers his

land as collateral for a loan, the creditor acquiring the right to work the
land until such time as the borrower pays his debt. More often than not, the
debtor never manages to repay. The pledge system is often used-especially
by traders and administrativeworkers-to build up holdings in land.
 -30 - ANNEX 5
Page 4

Leases are used by landowners short of money who are prepared to

let their fields in return for payment of an agreed sum plus interest for a
certain period. In this case, the lender has the right to the crops produced
on the land and any wood obtained in the course of clearing operations, while
the owner retains title to all fruit trees.

Sale has become the most common means of transferring land. The
majority of cooperative members interviewed obtain new land by this method.
The prevailing price is geared to the kantin, the unit of land measurement
most widely used on the Allada plateau. The kantin is equivalent to 400 m2
and sells in the region for between CFAF 4,000 and CFAF 6,000, putting the
pre-hectare cost between CFAF 80,000 and CFAF 120,000. This price for land
is clearly well above that at which cooperative land has been rented by the
State, namely CFAF 30,000.

These methods of acquiring title to land have had a tremendous

influence on the way farming operations are conducted, since there has been
too much land subdivision. The average size of the household plot today is
between 0.5 and 2.5 ha. Approximately 83X of holdings fit within this
category. The remaining 17Z consist of more than 2.5 ha. Of the 18 Group-A
cooperative members interviewed, four belonged to the first group and 14 to
the second. Exceptions were the three large estates held by the Meideros
family at Houezee, the Quenum family at Djigbe and the Agbota family around
the village of Agbotagon; each of these landholdings contains over 200
hectares.l/

The predominance of small plots reduces the range of possible

crops, now limited to maize, groundnuts and cow peas. Coffee, important
prior to oil palm development, is in uninterrupted decline. Its place is
being taken by citrus fruits (pineapples and oranges) and particularly by
teak, currently very profitable to smallholders as a result of heavy demand
from the urban building trade.

The over-fragmented landholding pattern weakens agricultural

production to some degree because individual holdings are below the profit
and modernization threshold. It is for this reason the state is more and
more intent, in regions like Hinvi, on developing cooperative structures,
which it views as the only framework capable of giving small farmers a
minimum of technical assistance and financial support.

Despite everything, including the reduced size of their farms,

smallholders in this region today who took on their own account are far
better off than members of cooperatives, whose living conditions have
remained unchanged since the project was first launched, although the price
of maize per kilo has gone up from year to year. According to survey

1/ Parts of these large farms have been commandeered by the State for the
establishment of teak plantations (Quenum), plantings of selected oil
palm (Agbota) or state farms (Meideros).
 - 31 - ANNEX 5
Page 5

results, a kantin under maize has brought in about CFAF 10,000 per season
since 1980-in other words, approximatelyCFAF 250,000 per hectare. Over the
same period, the annual income of the member of a cooperative has been only
CFAF 65,000. This earnings gap between the independent smallholder and the
member of a cooperative explains the disaffection of the latter to the
cooperative system and his abandonment of the land area managed by the
cooperative.

The analysis given above of the bio-graphical features of the

Greater Hinvi Region demonstrates clearly that the environment within which
these attempts at oil palm development were carried out is a fragile one,
from both the natural and human standpoints. There are climatic and social
constraints, for instance-in particular, heavy population pressure,
scattered settlements and a severely fragmented pattern of land subdivision
-all of which handicapped the development program, harming the interests not
only of the State but also of the smallholder families affected.

The matters discussed above also explain in part the problems that
are likely to arise in the management of cooperative blocks.
 IMPACT EVALUATION REPORT/RAPPORTD'EVALUATIOND'IMPACT ECONOMIQUEET SOCIAL

BENIN: HINVI AGRICULTURALPROJECT/PROJETAGRICOLE D'HINVI

(CREDIT 144-BEN)

SOBEPALH: Cost of ffb as a proportionof totalsales/

Evolutionde la part du prix d'achatdes regimesdans le totaldes ventesde la SOBEPALH
(in CFAF millions/Enmillionsde FCFA)

75/76 76/77 77/78 78/79 79/80 80/81 81/82 a/

1. Purchasesof FFB/Achatdes
r6gimes 663.5 449.6 283.4 261.2 339.4 348.3 523.4
2. Salespalm oil/Ventehuile
de palme 1937.7 1143.8 1040.7 996.7 1229.3 2168.0 2524.4
3. Saleskernels/Ventepalmiste 154.5 194.2 96.9 125.5 1?0.7 148.4 209.6
4. Total sales/Total
ventes 2092.2 1338.0 1136.9 1122.2 1360.0 2316.4 2734.0

1/4
Proportion/Rapport 31.7 33.6 24.9 23.3 25.0 15.0 19.1

a/ Estimated/estimations.

Economique(missiondata).
Source: CaisseCentralede Cooperation

Ii
 IMPACTEVALUATION
REPORT/RAPPORT
D'EVALUATION
D' IMPACTECONOMIQUE
ET SOCIAL

BENIN: HINVI AGRICULTURALPROJECT/PROJETAGRICOLE D'HINVI

(CREDIT 144-BEN)

Different Worker Groups within the Cooperativesas of April 1983/

Les differentes categoriesde travailleursA l'interieur de chaque coopErative en Avril 1983

Shares/PartsA Shares/PartsB Shares/PartsAB Users/Usagers

Cooperative/ Initially/Currently/ Initially/ Currently/ Initially/Currently/ Harvest/ Maintenance/
Cooperative de depart en activitf de depart en activit6 de depart en activith A la A l'entre-
r6colte tien
Attogon 482 0 273 50 8 5 140 300
Agbotagon 401 0 136 50 26 26 40 120
Hanafin 505 140 52 20 19 6 60 200
Koundokpoe 528 0 60 59 27 27 30 80
Goulo 281 2 122 50 14 11 80 200
Sadj8 409 0 70 20 14 11 150 20f
Adjan 529 370 189 116 27 27 few/faible few/fai.-'.;;
Kpof-Kpanroun 418 352 157 80 18 17 70 30
Dodji-Gb6to 691 0 84 30 11 8 - _
Dodji-SAhA 496 0 167 10 32 3 77 200
Total 4,740 864 1,310 465 195 140 647 1,130

Source: Field survey/Enquetesur le terrain.

 ;34 ANNEX 8
Page 1

IMPACT EVALUATIONREPORT

BENIN: EINVI AGRICULTURALPROJECT

(CREDIT 144-BEN)

Worker Reactiun to the Cooperative Experience

What will be examined here is primarily a reaction to the material

conditions prescribed by the supervising agency. Although those conditions
may be the same in every case, reactions differ depending on what category a
worker belongs to; members of Boards of Directors, ordinary members of
cooperatives, -users,"all have different interests to defend.

A. Viewpoint of Board Members

This viewpoint was reflected in answers to the following questions:

is the part you play what you would like it to be? If not, what do you
think you could be doing?'

Although answers received were not always unequivocal, considerable

mention was made of the ambiguous nature of the role of the Boards of
Directors, which, in the opinion of Board members, seemed to be to enable the
supervising authority to settle problems in the rural environment more
easily. In support of this contention the Board members interviewed said
almost unanimously that decisions coming from above on plantation mainten-
ance, dissemination of new working methods or recruitment of manpower were
always carried out. On the other hand, grievances expressed at the grass-
roots level and transmitted upward by the Boards were not often taken into
consideration. This state of affairs undermined the position of the Board
member in his own milieu to some degree. Most Board members felt they were
in a difficult position with their comrades. Antagonisms sometimes rose
which only damaged the cooperative spirit. Conflictual situations had
developed to quite an advanced point in the cooperatives at Dodji-Gb&to,
Kpo&-Kpanrounand Dodji-Sah4.

One almost unanimous opinion among the ten Board members interview-
ed was that the cooperative units should be selt-m&'aging. None of the Board
members regarded his cooperative as the property of the community group; as
far as everyone was concerned, the cooperative belonged to the supervising
authority. On this score, some interesting analyses were made at Agbotagon
and Dodji-Saha on the ffb price per kilo, the way in which rroduction tonn-
ages are calculated for each cooperative and the expenditures statements for
each fiscal year.

On the subject of the ffb price per kilo, all Board members thought
that if they had real control of their cooperative they would be able to
improve this price by exploring other markets-in Nigeria, for instance. The
fullowing is a verbatim account of an incident related in support of this
 ~
35 - ANNEX8
Page 2

poaition: "We had an interesting experience here in Sehe. When the Hinvi
mill was being overhauled in 1982, we sent two and a half tons of ffb to the
mill at Houin-Aganey, which was to process the fruit from our cooperatives.
Our ffb were returned to us for not being ripe. We then sold them on the
market for CFAF 96,000, although the price we would have got from the mill
was only CFAF 17,500. This single instance gives some idea how we are
exploited by SOBEPALH.- And as one member of a cooperative put it: -if we
had a free hand, the members certainly wouldn't be having losses like this.'
As far as recording production tonnages for each cooperative unit is concern-
ed, members of Boards of Directors believed it would be fairer if weighing
took place within the cooperatives themselves rather than at the mill, where
mathematical errors can be made to the detriment of the cooperatives.

On the subject of the statements of expenditures, all those

interviewed said theirs was always returned to them altered. New columns of
expenditures often appeared, sometimes higher than those actually incurred.

These three examples show very well how little control members of a
cooperative have over its management; they highlight the major problems of
the cooperative system perfectly.

B. Reaction of Group-A Members of Cooperatrves

This group of workers is generally mature. Out of 18 members of

cooperative A-groups interviewed, 14 were over 50 years of age; only 4 were
between 30 and 50. This is probably reflected in their reactions, which have
hardened with time. Inquiries show them to be the heaviest losers in the
group. Most of them ceded extensive tracks of land to the project, receiving
in return no more than little plots of ground which are difficult to work
profitably.

We encountered five who were veritable 'bourgeois"landowners today

reduced to poverty. These formerly rich men, when asked the question 'Are
you better or worse off now than before the project", simply pointed to the
remains of their old possessions-the ruins of a mill, a once fine but now
ramshackle house and large tracts of unoccupied land.

Their losses are not limited to land and material assets. Above
all, they have lost influence in their communities,beginning with their own
children, who, believing they would profit from cooperative structures,
voluntarily withdrew from under parental authority, or, lacking land of their
own to work, left the family environment as part of the rural exodus.

It is among members of the A group that the reaction is most

visible. Their great nostalgia for the past means that they identify the
project as the cause of their impoverishment. In their view, what is
necessary is to forget the cooperative experiment and return to the old ways,
sharing out the plantation blocks in a pro rata fashion based on the size of
the areas members originally ceded to the cooperative.
 ~
- 36 - ANNEX 8
Page 3

C. Reaction from group-B Members of Cooperatives

By comparison with their A counterparts,the members of this group

are young, the majority between 30 and 50. Among the 18 participantsin the
interview sample, 13 were under and 5 were over age 50.

Most of them have plots in the ZOCAs and are satisfied w'th them.

Their main problem is low wages. They always compare their wages
to those earned by the free smallholder, who hires himself out as a simple
farm hand to local landowners. He receives CFAF 500 for tilling one kantin
(400 m2). As he is able to till 4 kantins a day, he returns home at night
with CFAF 2,000 in his pocket. This prospect is very tempting and explains
why group-B members are prepared to leave the areas worked by their coopera-
tives and become farm laborers themselves. They return to work on the
cooperative blocks only when there are no jobs available elsewhere. For this
group, which should provide the driving force behind their cooperatives, work
within the cooperative becomes a secondary consideration.

When asked if they think their present situation is better or worse

than before the project, they all say no. The only ones in the group who
remain full members of their cooperatives are those in the Boards of
Directors, but they are prevented from deserting only by a feeling of responr
sibility. Obviously, therefore, their criticisms of the cooperative system
are among the most severe.

Within the group, it is the members of Boards of Directors who are

the heaviest losers. They get no vacation and no time to attend to their own
affairs. Moreover, they are expected to look out for and curb thefts of ffb,
when the thieves are none other than their own poorly paid comrades. One
therefore understands very well that they prefer to supervise the network
rather than destroy themselves socially for the good of an experiment the
worth of which is, in the end, a matter of conjecture.

D. Reaction of -Users"

Members of this group are the same age as those in group B. Tme
nine interviewed were under 40. Their existence is a consequence of the
desertion by the real members of the cooperatives,which made it crucial to
find substitute manpower for plantation maintenance.

However, even without the desertion, it would have been necessary

to resort to this third group in view of the increasing age of the group-A
members.

At present, users predominate in the cooperatives(see Table 5) and

are their most forceful element. They too look for work on the oil palm
plantations in order to earn extra income after they have attended to their
own farming or trading activities. Among them, only the women are active on
a permanent basis.
 ANNEX 8
Page 4

Unlike the full-fledged members of the cooperatives, users are

satisfied with existing arrangements,which allow them an opportunity to earn
additional income and provide a barrier against under-employment in the rural
world. They would be much better satisfied if wages were higher.

In conclusion, there was very little favorable reaction to the

experiment. Actual cooperative members interviewed were unanimous in
stressing the decline in their material and social position by comparison
with the past and with members of their world who were not participants in
the cooperatives-a state of affairs that compromises the future of the Hinvi
Agricultural Project.

'Can anything be done to improve the current situation, at least

somewhat?" This question was put to the workers themselves, in the following
form: -Would you like to see a continuationof the cooperatives,and in your
opinion what are their prospects for the future?" Responses were extremely
varied. Of the 48 individuals interviewed, 21 wished to see the current
situation improved by:

- an increasein land rents;

- an iLcrease in the daily wage rate;

- rehabilitationof the ZOCAs that have become unproductive for lack

of fallow and fertilizers by authorizing tree plantings;

- regular payment of dividends whenever there is a surplus for the

fiscal year.

Six other respondents found the present situation acceptable and

suggested no changes; four wished to see the cooperatives turned into state
farms, a point of view with considerable support on the Boards of Directors;
two asked for dissolution of the cooperatives and redistribution of their
landholdings to the former owners; two had no confidence in the cooperatives
and expected their future to be anything but brilliant; thirteen interviewees
had no opinion one way or the other.
 IMPACT EVALUATIONREPORT/RAPPORT D'EVALUATION D'IMPACT ECONOMIQUE ET SOCIAL

BENIN: HINVI AGRICULTURALPROJECT/PROJET AGRICOLE D'HINVI

(CREDIT 144-BEN)

Profit and Loss Statement of the Cooperatives from 1977-82/

Bilan des coopfratives de 1977 a 1982
(In CFAF/en FCFA)

1977 1978 1978 1979 1979 1980 1980 1981 1981 1982

Cooperative/ Profit/ Loss/ Profit/ Loss/ Profit/ Loss/ Profit/ Loss/ Profit/ Lose/
Coophrative B6n6fifce DSficit B6n6fice Deficit B6n6fice D6ficit B6n6fice D6ficit B6n6fice D8ficit

Attogon 1,744,577 194,240 2,654,825 4,867,359 1,743,052 W

Agbotagon 3,822,632 2,495,949 7,662,448 3,303,664 4,871,231
Goulo 6,983,114 2,485,955 1,293,473 3,406,160 2,261,323
Saha 239,453 2,214,721 2,477,402 1,199,147 4,505,380
Koundokpo6 4,382,711 2,549,390 665,586 3,612,112 1,572,926
SBdja 5,229,518 342,392 1,046,303 3,426,921 8,918,070
Adjan 2,566,284 94,879 1,286,515 8,720,250 9,384,417
Hanafin 3,688,087 374,610 2,130,497 5,702,259 10,168,600
Gb6to 7,304,279 2,625,745 5,897,527 5,628,193 6,221,116
Kpof 6,452,986 5,041,163 3,665,825 1,252,168 8,618,352

Total 3,822,632 38,591,008 3,502,070 14,916,874 11,745,046 17,035,355 33,269,908 35,398,736 14,839,468

Source: Field survey/EnquSte sur le terrain.

ii.
MM
 - 39 -

Annex 10
Annexe 10

IMPACT EVALUATIONREPORT/RAPPORTD'EVAIUATION D'IMPACT ECONONIQUEET SOCIAL

BENIN: HINVI AGRICULTURALPROJECT/PROJET AGRICOLE D'HINVI

(CREDIT 144-BEN)

Composition by Age and Sex of the 5 Rural Communities in the Hinvi Region/
Structuree par Age et par Sexe des Cing Communes Rurales de la Region d'Hinvi

Rural Coumtnity/ Age Groups/ Structure par Age (Z) Males/100 Females/
Co-mune rurale Hoinmes/100 Femes

Age 0-5 6-9 10-14 15-49 504 15-49 50*- Total

Adjan Total 26 13 7 35 18 68 94 88
Men/Hormes 13 7 4 14 9
Women/Feres 13 6 3 21 9

D.Bata Total 26 15 9 37 13 56 103 84

Men/Hormes 13 8 5 13 7
Women/Feres 13 7 4 24 6

Sedje D.Total 25 14 10 39 13 71 102 93

Men/Horns 12.5 8 6 16 6
Women/Feres 12.5 6 4 23 7

Dame Total 27 13 9 38 12 69 114 90

Men/Hommes 13 7 5 15 6.5
Women/Feres 14 6 4 23 5.5

Houegbo Total 25 15 12 40 9 74 113 93

Men/Hommes 12.5 8 6 17 5
Women/Ferns 12.5 7 6 23 4

Ensemble Total 26 14 9 38 13 67 105 90

Men/Hormes 13 7.5 5 15 6.5
Women/Feres 13 6.5 4 23 6.5

Source: FAC Ex-post Evaluation Report/Rapport d'evaluation retrospective du FAC.

-~ ~~ ~ ~ ~ ~~~~~~4 -

- 40 - annexe11
Page 1

IMPACT EVALUATIONREPORT/RAPPORTD'EVALUATIOND'IMPACT
BENIN: HINVI AGRICULTURAL PROJECT/PROJET AGRICOLED'HINVI
(CREDIT 144-BEN)

Bank Contribution to the World Oil Palm/CoconutSector

The World Bank Group has helped finance 40 oil palm and coconut
development projects in 13 countries (see list below). Some of these pro-
jects also include a rubber or other tree-crop component (projects focusing
exclusively on rubber-grovingare not included in the list) There is a coco-
nut component in only nine of the 40 projects where oil palm predominates.
By the start of 1983, the Bank had lent more than US$900 million to the oil
palm/coconutsector.

Eighteen projects (45Z of the total number of loans), representing

US$270 million (29% of total lending to the sector), were carried out in
Africa. Twenty-one projects (53%), representing US$640 million (69Z), were
in Asia and one project (2%), representing US$19 million (2Z), in Latin
America. The largest borrowers in the sector were, in order: Malaysia (10
projects), Indonesia (8 projects), Nigeria, Cameroon and Ivory Coast (4 pro-
jects each).

The development strategy based on estate plantations surrounded by

outgrower plantings was adopted in Ivory Coast, Ghana, Liberia, Nigeria and
partially in Indonesia. Estate plantations predominatedin Cameroon, Zaire,
Panama and some regions of Indonesia. A strategy focusing on small planters
was implemented in Benin, Malaysia and Papua-New Guinea, project goals in the
last two countries being to clear virgin forest and settle farm families.

The Bank issued performance audit reports on 18 of the 40 projects

(1 in Benin, 1 in Papua-New Guinea, 2 in Cameroon, 3 in Indonesia, 4 in
Ivory Coast, 4 in Malaysia, 1 in Ghana and 2 in Nigeria). On completion,all
except those in Benin and Nigeria were considered successes, with economic
rates of return well above 10% and often higher than estimated at appraisal.
Since the prices obtained for the oils produced were higher than projected,
they generally offset cost overruns. The Benin project, with an ERR of 5Z,
was an exception, but on completion its social impact was considered enough
to have made it worthwhile. The two projects in Nigeria had negative ERRs
and failed, partly because of certain of the country's internal problems and
partly because organization in the oil palm sector was not integrated. The
New Britain Smallholders Project in Papua-New Guinea was the subject of an
impact evaluation report, as are projects in Ivory Coast at the moment.

In the great majority of cases, beneficiarieswere granted loans for

outgrover plantings. The problem of credit recovery was universal, although
varying in degree, except in Papua-New Guina, where early, high yields made
advance repayment possible, and in Malaysia, where growers are under the
 -41 - Annex 11
Page 2

authority of the State company (FELDA) which guides and supervises them until
their debts are fully repaid.

The 22 projects still being implemented are affected by political

and economic difficulties in some countries (Nigeria and Zaire) and by lower
world prices for vegetable oils.
 - 42 -

Annex 11
Total aount Approx. Area planted/replanted Page 3
Number of loanstcredits (ha)
Region projects Z (US$ illions) Z Estate Outgrower
plantations plantin8g
Africa 18 45 270 29
Asia 21 53 640 69
Latin America 1 2 19 2
Total 2I0 100 I2i 100 330.000 170,000

Amount of Effective date/

Project loan/credit closing date Project Description

AFRICA

Benin Cooperative oil palm plantings (16,000 ha); construction

(Cr.
viuvl 144) 5.2 1969-76 of oil mill.

Caseroon
1st CAMKEV Project
(Loan 490 and Cr. 100) 18.0 1967-73 Estate and outgrover plantings (6,350 ha).
lat SOCAPALUProject
(Loan 593 and Cr. 886) 9.6 1969-74 Estate and outgrover plantings (8,660 ha).
2nd CAMDEV Project (Loan 1508) 15.0 1978-82 Estate oil palm (600 ha) and rubber plantings.
2nd SOCAPAL Project (Loan 1392) 18.0 1977-82 Estate and outgrover oil palm plantings (7,000 ha).

Cmoros
Coconut Project (Cr. 1035) 5.2 1980-86 Rehabilitation of coconut plantations.

Ivory Coast
lot Oil Palm and Coconut Projec. Estate (4,000 ha) and outgrover (12,000 ha) oil palm
(Loan 611, 612 and 613) 17.1 1969-75 plantings; estate (3,500 ha) and outgrower (3,000 ha)
coconut plantings; construction of oil mlU
2nd Oil Palm and Coconut Project Outgrower oll palm (4,500 ha) and coconut (4,500 ha)
(Loans 759, 760) 7.0 1972-79 plantings and estate coconut (8,000 ha) plantings;
contruction of oil will
3rd Oil Palm Project (Loan 1036) 2.6 1974-77 Outgraver (5,000 ha) and estate (5.250 ha) oil palm plantings.
4th Oil Pa1 and Coconut Project
(Loan 1382) 35.8 1980-86 Estate oil palm (6,258 ha) and coconut (6724 ha) plantings.

Oil Palm Project (Cr. 531) 13.6 1976-83 Estate (4,000 ha) and outgrover (1,200 ha) oil pala plantings;
construction of oil mill.

Liberia
Decoris Oil Palm Project Estate (5,000 ha) and outgrover (2.500 ha) oil palm plantings;
(Loan 1765) 12.0 1981-87 construction of oil mill.

Nigeria
1st Oil Pal Project Estate (8,000 ha) and outgrover (8,000 ha) oil palm plantings;
(Loan 1183) 29.5 1975-84 construction of oll will.
2nd Oil Palm Project Outgrower oil palm plantings (16.000 ha); construction of
(Loan 1191) 19.0 1977-84 2 oil mills.
3rd Oil Palm Project Estate (6,000 ha) and outgrover (6.000 ha) oil palm plantings;
(Loan 1192) 17.0 1978-84 construction of 2 oil ailla.
4th Oil Palm Project Estate (10.000 ha) and outgrover (10.000 ha) oil palm
(Loan 1951) 30.0 1979-84 plantings.

Tanzania
Pyrethri Project (Cr. 1070) 6.8 1981-85 Pilot coconut project.

Zaire Estate (11,000 ha) oil palm plantings/replantings;

Oil P}al Project (Cr. 796) 9.0 1978-85 rehabilitation of oil mill.
 - 43 -

Amount of ffective date/ Annex 11

Project loanlcredit closing date Project Description Page 4

ASIA
Indonesia
let North Sumatra EstatesProject
(Cr. 155) 16.0 1969-76 Estate oil palm plantingalreplantings (36,300 ha).
2nd North Sumatra Eatates Project
(Cr. 194) 17.0 1970-77 Outgrouer oil palm plantings (3,300 ha).
North Sumatra Sualholders Project Estate plsntings/replantings (23.000 ha) oil palms
(Cr. 358) 5.0 1972-81 and rubber.
4th Nucleus Estates Project Estate plantingsjreplantings (23 000 ha) of oil palms
(Loan 3V9) 11.0 1973-81 and rubber.
Nucleus Estates and Smaliholders Estate and outgrover oil palm (5,000 ha) and rubber
Project (loan 14"9) 65.0 1978-82 plantings; conversion from rubber to oil pals.
3rd Nuclewu Estates and Small- Rubber project vith small oil palm estate component
holders Project (Loan 1751) 99.0 1979-86 (2,135 ha).
4th Nucleus Estates and Small- Outgrower oil palm plantings (8,000 ha); construction of
holders Project (CLoa 1835) 42.0 1980-86 oil mill; rubber component.
Coconut SmalIholders Project Rehabilitation of 38,000 ha and pLanting of 37,700 ha of
(Loan 1898) 46.0 1980-86 coconut palms.

Lat Jeugka Triangle Land Settlement Outgrower oil palm (10,450 ha) and rubber plantings;
Project (Loan 533) 14.0 1968-75 construction of oil mill.
2nd Jeugka Triangle Land Settlement
Project (Loan 672) 13.0 1970-78 Outgrower oil pals (6,800 ha) and rubber plantings.
3rd JeDgka Triangle Land Settlement Outgrover oil palm (8,900 ha) and rubber plantings;
Project (Loan 885) 25.0 1973-81 construction of oil mill.
Johore Land Settlement Project Outgrover oil palm (26,200 ha) plantings; construction
(Loan 967) 40.0 1974-81 of 3 oil mills.
Vast Johore Project Conversion of outgrouer rubber plantings to oil palm
(Loan 973) 45.0 1974-83 and coconut.
Kar:.tong Settlement Project Outgrower oil palm (22,000 be) plantings;
(Lon 1044) 36.0 1975-83 construction of 3 oil mills.
FELDA VT.Land Settlement Project
Loan 1590) 28.0 1979-85 Outgrover oil palm (8,100 ha) and rubber plantings.
Coconut Smallholders Development Rebabilitation/replanting of 23,000 ha of outgrower coconut
ProJect (Loan 1618) 19.5 1979-85 plantings.
Trans-Perak Project (Loan 1960) 50.0 1981-89 Outgrower plantings (8,400 ha) of oil palm, rubber and coconut.
Outgrover plantings (8,100 ha) of oil palm and rubber;
FELCRAI Project (Loan 2013) 37.0 1981-86 construction of 2 oil mills.

Papua-New Cuinea
Ne Britain Land Settlement and
Development Project (Cr.1371175) 4.9 1969-73 Outgrower oil palm plantings (3,850 ha).
Sopondetta Lrad Settlement Project Outgrover (5,400 ha) and estate (4,000 ha) plantings of
(Loan 1333) 12.0 1977-84 pals; construction of an oil mdll.
Agricultural credit for plantings of oil paln, rubber and
2nd Credit Project (Loan 1149) 15.0 1982-84 other tropical tree crops.

LATINAME1CA

Tropic l Tree Crop Project 19.0 1979-85 Plantings of oil pals (3,000 ha), coffee and cocoa; construction
of an oil 5.11.
 BEN I N
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