pdf.usaid.govpdf.usaid.gov/pdf_docs/pdkae389.pdf · · 2011-02-15agency for international...

AGENCY FOR INTERNATIONAL DEVELOPMENT WASHINGTON DC 20523

ASSISTANT ADMINISTRATOR

ACTION MEMORANDUM TO THE ADMINISTRATOR

THRU AAPPC Richaroqa

FROM AAIAC Dwight Ink

SUBJECT Approval of Dominican Republic FY 1986 PAAD for $40 million in ESF Balance of Payment Support Funds

ACTION REQUESTED Your approval is requested for a $40 million balance of payments support grant to the Dominican Republic from FY 1986 Economic Support Funds

BACKGROUND The Dominican Republic (DR) has suffered a serious decline in GDP per capita over the last five years The percapita GDP which was over $1000 a few years ago has now dropped to about $770 The predominant factors behind this drop are a steady decline in the terms of trade from the mid-seventies on a downward trend in the prices of the DRs principal exports notably sugar and devaluation of the Peso

Despite these problems the present government has made good progress in stabilizing the economy It conducted negotiationswith the IMF in 1982 which led to IMF approval of an Extended Fund Facility in January 1983 However the GODR fell out of compliance by the end of that year due to excessive fiscal deficits The GODR then restructured its approach to economic stabilization It issued an Economic Policy Statement in August 1984 which outlined a set of policy reform and comprehensive adjustment measures it intended to carry out through 1985 Based on this statement and subsequent GODR implementation of the measures contained therein IMF approved a one year Stand-by on April 15 1985

Among the measures taken by the GODR to implement its stabilization program are moving all foreign exchange transactions to a single floating rate substantially raisingdomestic prices on petroleum products and electricity limitingdomestic credit expansion and placing ceilings on disbursement of non-concessional external and public-guaranteed debt It rescheduled official debts at the Paris Club in 1985 and has successfully renegotiated it3 commercial bank debt twice (in 1983 and 1985)

Under its present IMF agreement the GODR has pledged to decrease net public sector financing requirements from 75 of GDP in 1984 to 49 in 1985 request congressional approval of new taxes price the services provided by public enterprises to

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cover their current costs and gradually achieve an adequate return on investment lower generation costs of the electric company by substitution of coal for oil raise nominal interest rates for financial institutions subject to regulation maintain wage restraint and improve the operations and reduce the deficit of the Price Stabilization Institute

DISCUSSION The GODR has met and in some areas substantially exceeded the targets it set with the IMF under its present arrangement Inflation currently running around 25 per year appears to be falling and the value of the Dominican Peso has been stable at around three to the dollar for the last eight months (The official rate which was eliminated in January 1985 was 11) However the cost of progress has been high Production declined during the first half of 1985 and GDP growth is expected to be zero or negative in real terms for the full year Progress achieved to date is jeopardized by a projected shortfall in net foreign assets which threatens to force the GODR out of compliance with end of year criteria under the stand-by agreement and jeopardize a $280 million commercial bank rescheduling

In its PAAD the Mission proposed a $50 million grant to provide immediate balance of payments support to the Dominican Republic and to make a major contribution to cutting the current account deficit and help leverage a restructuring toward a market based economy Immediate disbursement of $40 million is needed to help insure that the GODR will meet the end of year net foreign assets test under the IMF stand-by agreement The remaining $10 million will be needed to help the Dominican Republic maintain foreign exchange availability during 1986 when the Dominican Republic will be feeling the effects of expected $25 million decrease in the US sugar quota and to encourage a reduction of recently imposed export taxes

In addition to satisfying standard CPs to disbursement (eg the submission of legal opinion and the desionation of authorized representatives) and basic covenants (joint USAIDGODR programming of ESF counterpart and the importation of the equivalent amount of the grant for spare parts capital goods and industrial and agricultural inputs from the United States) the Mission proposes that the GODR agree to the following covenants

1 Remove the 5 percent exchange tax on non-traditional exports not later than the end of the first quarter of 1986

2 Reduce significantly the 36 percent exchange tax surcharge on traditional exports achieved by the end of the first quarter 1986

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3 Adhere to the previous economic adjustment commitment contained in the FY 8485 ESF agreement

4 Develop and publish objective regulations for designating export products for restriction providing the justification for determining the quantity and duration of the export restrictions

5 Provide increased access to State Sugar Council (CEA) lands by private investors and establish and promote the conditions and procedures for facilitating productive private sector access to these lands

6 Undertake a comprehensive study which will recommend a national sugar policy and plan for diversification

As a result of the December 13 PAAD review it was decided to recommend approval of $40 million for balance of payments support The entire amount available will be disbursed before December 31 1985

The PAAD facesheet has been modified to reflect this recommendation to approve $40 million If additional funds become available during the year to complete the $50 million level requested by the Mission we intend to request your approval for the additional funds based on the present PAAD In this case we would restate the covenants on reduction of export taxes as conditions precedent to disbursement of the additional funds

CONGRESSIONAL NOTIFICATION This program is contained in the FY 86 Congressional Presentation therefore no Advice of Program Change is required

RECOMMENDATION

a) That you sign the attached PAAD Facesheet authorizing $40 million in ESF balance of payments support for the Dominican Republic from FY 1986 Economic Support Funds

b) That you authorize obligation and immediate disbursement of up to $40 million subject to availability of funds

Approved _

Disapproved

Date

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Disapproved

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CLASSIFICATION i GRANT NODEPARTMENT OF STATE 517-0171 amended 517-K-603

AGENCY FOR 2 COUNTRY

INTERNATIONAL DEVELOPMENT Dominican Rpubic

S CATEGORY

PAAD PROGRAM ASSISTANCE Cash Transfer APPROVAL DOCUMENT

4 DATE

December 12 1985 5 T 6 OYS CHANGE NO

AAID M Peter McPherson 1 OVO INCREASE

1 FRM

AALAC Dwight Ink To SEE TAKEN F--Economic Supoort Funds

ORU MAMITME r 10 APPROPRIATION - ALLOTMENT

$ 40 000000 72-1161937 637-65-517-00-50-61ItYE FOP40ING 12 LOCAL CURRENCY ARRANGEMENT 13 ESTIMATED OCLIVER-t PLRIOD 14 T RANte C ~~0e T

T7LOAN L-RAN 1 FTINFORMAL fLFORMAL =]NONE DATE

IS CoMMODITIES FINANCEC

I6 PFRMITTED SOURCE 17 ESTIMATED SOURCE

US only US $40000000 Limited FW IndustrializeJ Countries Free World- Local Cash $40000000 Other

IS SUMMARY DESCRIPTION

The proposed $40 million grant will provide immediate balance of payments support to the Dominican Republic and will contribute to reduction of the current account deficit and encouraging restructuring toward a market economy It is proposed that $40 million be disbursed immediately subject to availability of funds

A $40 million program which is justified in the PAAD is hereby approved $40 million of this amount is hereby approved for immediate commitment and commitment of the remaining $-o-million is subject to the availability of funds in accordance with the AID OYBAY-otment process and amendment of the PAAD facesheet Authorityis hereby delegated to AALAC with HFM clearance to amend the PAAD facesheet adding the remaining $ 0 million upon availability of funds

In addition to satisfying standard CPs to disbursement (eg the submission of legal opinion and the designation of authorized representatives) and basic covenants (joint USAIDGODR programming of ESF counterpart and the importation of the equivalent amount of the grant for spare parts capital goods and industrial

(continued on page 1)

19 CLEARANCES DM QAT1 20 ACTION

LADR DInhnsrnAn APPROVED rj DISAPPROVED D

GC AUTHORIZED SIGNATURE DATE

---VIson - TTrL E

ics r rION7

and agricultural inputs from the United States) the GODR will agree to

A Major Covenants


2 A significant reduction in the 36 percent exchange tax - surcharge on traditional exports achieved by the end of the first quarter 1986



5 Provide increased access to State Sugar Council (CEA) lands byprivate investors and establish and promote the conditions and procedures for facilitating productive private sector access to these lands


ACTION UNCLASSIFIED INCOMING AGCOPY 1eparlinent oJ Iate TELEGRAM

PAGE 01 SANTO 13860 961996Z 5439 014603 AID9705 SANTO 130GB 061906Z 5439 174003 ACTION AID-DO PROMOTE THE CONDIIIONS AND PROCEDURES FOR FACILITATING

----------------------------------------------------- PRODUCTIVE PRIVATE SECTOR ACCESS TO THESE LANDS ACTION OFFICE LA] INFO FPA-02 LACO-0I LAUP-04 uC-01 GCLA-03 GCFL-01 TRSY-O5 UIDERTAKE A COMPREHENSIVE STUDY WHICH WILL

RELO-O TELE-O LACA-03 025 Al XD RECOMEND A NATIONAL SUGAR POLICY AND PLAN FOR

--------------------------------------------------------------- DIVERSIFICATION KILDAY INFO LOG-O0 ES-0B ARA-O0 L-03 al1w

------------- 263565 061907Z 38 0 061904Z DEC 85 7 M AMEMBASSY SANTO DOMINGO TO SECSTATE WASHOC IMMEDIATE 1835

UNCLAS SANTO DOMINGO 13860

AIDAC

FOR LAOOR

EO 12356 IiA SUBJECT- DOMINICAN REPUBLIC PAAO FACESHEET

REF ARIISTRONGZALLMAII TELCON 12585

1 FOLLOWING ISTHE SUGGESTED TEXT FOR THE DRS PAAD FACESHEET

2THE PROPOSED DOLS 50 MILLION GRANT WILL PROVIDE IMMEDIATE BALANCE OF PAYMEJIS SUPPORT TO THE DOMINICAN REPUBLIC AND WILL THEREFORE MAKE A MAJOR CONTRIBUTION TO CUTTING THE CURRENT ACCDUNT DEFICIT AND ENCOURAGING A RESTRUCTURING OFTHE ECONOU TO BA3E IThORE ON MARKET FORCES

3 INADDITIOoI TO SATISFYING STANDARD CPS TO DISBURSEMENT (EG THE SUEMISSION OF LEGAL OPINION AND THE DESIGNATION OF AUTHORIZED REPRESENTATIVES) AID BASIC COVEIANTS (JOIIITUSAIDGOUR PkOGRAIMING OF ESF COUNTERPART AiD THE IIIMPOTATION OF THE EQUIVALENT AMOUNT OF THE GRANT FOR SPARE PARTS CAPITAL GOODS AND INDUSTRIAL AND AGRICULTURAL INPUTS FROM THE UNITED STATES) THE GOOR WILL AGREE TO

- A CP FOR FIRST DISBURSEMENT OF DOLS 40 MILLION ESF GRANT

- - REMOVE THE 5 PERCENT EXCHANGE TAX ON NON-TRADITIONAL EXPORTS NLT THE END OF THE FIRST QUARTER OF 1986 B CPS TO THE SECOND DISBURSEMENT OF DOLS 10 MILLION ESF GRANT

- - THE GOOR ADHERES TO THE COVENANTS AND BENCHMARK TARGETS ARE BEING ACHIEVED

- w A SIGNIFICANT REDUCTION INTHE 36 PERCENT EXCHANGE TAX - SURCHARGE ON TRADITIONAL EXPORTS ACHIEVED BY THE END OF THE FIRST QUARTER 1986

C MAJOR COVENANTS

- ADHERE TO THE PREVIOUS ECONOMIC ADJUSTMENT COMMITMENT CONTAINED INTHE FY 8485 ESF AGREEMENT

- - DEVELOP AND PUBLISII OBJECTIVE REGULATIONS FOR DESIGNATING EXPORT PRDOUCTS FOR RESTRICTION PROVIDING THE JUSTIFICATION FOR DETERMINING THE QUANTITY AND DURATION OF THE EXPORT RESTRICTIONS

- - PROVIDE INCREASED ACCESS TO STATE SUGAR COUNCIL (CEA) LANDS BY PRIVATE INVESTORS AND ESTABLISH AID

AID71

UNCLASS IFIED 6

_ _

4ID 1- CLASSIFICATIONI PAAO No -- -4

DEPARTMENT OF STATE 517-0171 amended AGENCY FOR 2 COUNTRv

INTERNATIONAL DEVELOPMENT Dominican Republic a CATEGORY


4 DATE

December 12 1985 TO S OY ChANGE NO

AAID M Peter McPherson S OYS INCREASE

7 FROM

AALAC Dwight Ink TO 09 TAKEN FROM

Economic Support Funds 0 ampPPDOVAL REQUESTEO FOR COMMITMEN r oFt APPROPRIATION - ALLOTMENT

L 50000000 ________

I YDPE FUNDING iZLOCAL CURRENCY ARRANGEMENT IS SIAED DELIVERY Pr6RIOD_ 14 TRANSACTOZj EL0i6LITY

2aLOAN EJ-GRAN T]INFORWAL JFORMAL ONONE 0 TZ

IS CIMI4ODITIES FINANCELO

16 RMITTED SOURCE 17 ESTIMATED SOURCE

US only US 50000000Linmid FW Industrialized Countries

Free World LocalCash 50000000 Other


The proposed $50 million grant will provide immediate balance of payments support to the Dominican Republic and will therefore make a major contribution to cuttingthe current account deficit and encouraging a restructuring of the economy to base it more on market forces

In addition to satisfying standards CPs to disbursement (eg the submission of legal opinion and the designation of authorized representatives) and basic covenants (joint USAIDGODR programming of ESF counterpart and the importation of the equivalent amount of the grant for spare parts capital goods and industrial and agricultural inputs from the United States) the GODR will agree to

A CP for first disbursement of $40 million ESF grant

- Remove the 5 percent exchange tax on non-traditional exports not later than the end of the first quarter of 1986


I CLEARANCES OATC 2C ACTION

TAQDR-J6hncn _ _ _ APPROVED D iSAPPROVr6

I Lpp W~h eeler _ _ _ _ _ _ _ _ _ _ _ _ _ _

GC Hr AUTNORIZED SIGNATUFE DATE

stensen TITLE

-1-

B CPs to the second disbursement of $10 million ESF grant

- The GODR adheres to the covenants and benchmark targets are being achieved

- A significant reduction in the 36 percent exchange tax shysurcharge on traditional exports achieved by the end of the first quarter 1986

C Major covenants

- Adhere to the previous economic adjustment commitment contained in theFY 8485 ESF agreement

- Develop and publish objective regulations for designating exportproducts for restriction providing the justification for determining-the quantity and duration of the export restrictions

- Provide increased access to State Sugar Council (CEA) lands byprivate investors and establish and promote the conditions and procedures for facilitating productive private sector access to these lands

- Undertake a comprehensive study which will recommend a national sugar policy and plan for diversification

ACTI ON UNCLASS IFIEU I1CLI011NG cOPy )epaiiinent f 1 TELEGRAM

PAGE 91 SANTO 1327 01 OF 12 222045Z 6505 969944 AID9306 SANTO 13281 1 OF 12 222045Z 6585 319044 A1013 ACTION AID-99 TARIFFS AT THE AME TIME ITFROZE PUBLIC SECTOR

-- CREDITS FROM THE iANKIN SYSTEIILIMITED MONETARY ACTION OFFICE tAOR-0 EMISSIONS REDUCED SOME PUBLIC SUBSIDIES AND BEGAN TO INFO FPA-92 AALA-91 LACO-01 LADP-04 PPPB-02 GC-01 GCLA-93 LIBERALIZE INTEREST RATES TO ENCOURAGE DOMESTIC

GCFL-91 PPDC-01 STAG-D2 SAST-0I PVC-92 ES-Il AGRI-91 SAVINGS THE GODR ALSO SUCCEEDED INRESCIIEOULING ITS STFA-1 TRSY-85 RiLO-Ol LACA-3 1035 Al X26 -

NATIONAL DEBTREPAYMENTSWITH TIlE PARIS CLUBAND INTERNATIONAL COIMMERCIALBANKS

INFO LOG-Il CIA-Il EB-IB DODE-DO ARA-gBOIBIS U

-- ------------ 315044 222046Z 38 AS A RESULT SOMEMEASURE OF ECONOMIC P 2220147 NOVLS STACILITY HAS BEEN RESTORED THE RATE OF INFLATION HAS FMAMEMBASSYSANTO DOMINGO FALLEN THE FREE MARKET EXCHANGE RATE HAS STABILIZED AT TO SECSTATE WASHOC PRIORITY 1428 ABOUT 300 PESOS TO TIE DOLLAR PUBLIC SECTOR DEFICITS

HAVE BEEN KEPT UIDER CONTROL NEVERTHELESS THE COST OF UNCLAS SECTION 91 OF 12 SANTODOMINGO 13207 ACHIEVING THIS STABILITY HASBEENHIGH RESULTING IN

LOWERPRODUCTION LEVEL7 ZERO GROWTH INTHE GDP AND A AIDAC WORSENING UNEMPLOYMENT SITUATION HOWEVER THE

DOWN-TURN INTHE DOMINICAN ECONOMY APPEARS TO HAVE PASS TO ARAICAR BOTTOMED OUT AND THE PROCESS OF ECONOMIC PECOVERY CAN

NOWBEGIII EO 12355 NA

ALTHOUGH SHORT-TERM STABILIZATION APPEARS TO SUBJECT FY-1986 ESF PAAD (PRIVATE SECTOR EXPANSION II- HAVE BEEN ACHIEVED THE DOMINICAN ECOLOMY NEEDS 10 MAKE

GRANT 517-9171 AMENDED) FURTHER PROGRESSIN PRICE AND SUBSIDY ADJUSTMENTS DIVERSIFIED EYPORT ENPANSIO ANDIMPRCVED EFFICIENCY

REFS (A)STATE 334191 (8)USAID FY-85 ESF CONCEPTS ANDOR PRIVATIZATION OF PUBLIC SECTOR ENTERPRISES PAPER ADDITIONAL MEASURES TYEXPAND THE AMOUNT OF OOVERIIET

LAND AVAILABLE TO PRIVATE INVESTORS AFE NEEDED ALONG I PROGRAM STRATEGY WITH Al ELIMINATION OF EXPORT RESTRICTIONS AND A

REDUCTION OF EXPCRT TAXES THE MlISS1rIWILL CONTINUE TO - A INTRODUCTION ENCOURAGE FURTHER REFORM MEASURES INDSCUSSIONS WITH

THE DOOR AND THROUGH IT USE OF ESF INTEGRATED WITH THE DOMINICAN REPUBLUC WITH A PER CAPITA GOP PL-460 TITLE IAND DFVELOPMENT ASSIST-ICE PROGRAS WILL

OF DOLS 770 IN1985 ISSTILL IN THE MIDST OF A SEVERE PROMOTE INVESTMENT AND EXPORT EXPAiSICflAGRICULTURAL ECONOMIC CRISIS HOWEVER THE GOVERNMENT OFTHE DIVERSIFICATION AND THE DEVELOPMENT OF RELATED DOMINICAN REPUBLIC IGOOR) IS IMPLEMENTING A DIFFICULT SUPPORTING INFRASTRUCTURE TO ACHIEVE THESE OBJECTIVES ECONOMIC STABILIZATION PROGRAM THAT SHOULD PROVIDE THE FOUNDATION FOR MORE DYNAMIC BROADLY-BASED GROWTH INTHE FUTURE ALTHOUGH USG ASSISTANCE HAS BEEN INSTRUMENTAL IN ENCOURAGING THE COOR TO ADOPT A CERIES OF IMPORTANT SNORT-TERM ECONOMIC POLICY REFORMS ADDITIO1AL RESOURCES WILL PE REQUIRED TO HELP THE bOmINICAN REPUBLIC CONSOLIDATE PROGRESS MADE UNDER THE STABILIZATION PROGRAM AND REORIENT ITSPRODUCTIVE BASE TOWARD A DIVERSIFIED EXPORT-LED ECOlOMY

THE CURRENT ECONONIC CRISIS REFLECTS THE FOLLOWING BASIC STRUCTURAL PROBLEMS I) HEAVY DEPENDENCEON A FEWPRIMARf EXPORTS WHOSEWORLDPRICES FLUCTUATE WIDELY (2)PREDOMINANCE OF INEFFICIENT

CAPITAL-IIITEIIIVE DOMESTIC INDUSTRIES WHICH ENJOY SUBSTANTIAL TARIFF PROTECTION BuT PROVIDE INSUFFICIENT NEW JOBS FOR THE EXPANDING WORKFORCE (3)FAILURE OF AGRICULTURAL PRODUCTION TO ACHIEVE ITS POTEhTIAL BECAUSE OF PRICE DISINCENTIVES INEFFICIENTLY MANAGED PUBLIC LANDS INADEQJATE INFRASTRUCTURE AND IADEGUATE SUPPORT FOR SMALL FARMERS WHO FRODUCE PRIMARILY FOR THE DOMESTIC MARKET (4)INAGEQUATE POICY INCENTIVES FOR THE PROMOTION OFNON-TRADITIONAL EPORTS AND (51 SHORTAGE PF TRAINED MANAGERSANDTECHrICIAIIS TODIRECT THE COUNTRYS DEVELOPMENT EFFORTS

- IN AN EFFORT TOSTACILIZE THE DOMINICAN ECONOMYAMCCREATE-All ENVIRONMENTWITHIN WHICH NON-INFLATIONARY GROWTHCOULD TAKE PLACE THEGODR IN JANUARY 1985 CONCLUDEDA PROCESS OFSELECTIVE DEVALUATIONS BYUIIFYING THEEXCHANGE RATEFROMITS PREVIOUS LEVEL OFONE PESO TOONEDOLLAR TOA FREELY DETERMINED MARKETRATE THE501 TOOK MEASURETOPASS ON THE HIGHER COSTOF IMPORTS TOCOIIUMERS THROUGH PRICE INCREASES OFPETROLEUM PRG3IICTS ANDELECIRICiTY

UNCLASS IFIED

ACTI ON UNCLASS FIED IItCOMING CO2Y Depaiinwii of TELEGRAM

PAGE 21 SANTO 13297 92 OF 12 222146Z 6607 169045 AIDS322 ACTION AID-00

- - ACTION OFFICE n INFO FPA-92 AALA-61 LACO-I LADP-94 PPPB-92 GC-91 GCLA-83

GCFL-91 PPDC-91 STAG-92 SAST-O PVC-92 ES-il AGRI-Il STFA-01 TRSY-95 RELO-9I LACA-93 936 Al X25

INFO LOG-00 COPY-01 CIAE-00 EB-B8 DODE-D0 ARA-I0 009 U

315061 222112Z 60

P 2229141 NOV 85 FM AMEI BASY SANTO DOMINGO TO SECSTATE WASHDC PRIORITY 1429

UNCLAS SECTION 02 OF 12 SANTO DOMINGO 13207

AIDAC

PASS TO ARACAR

EO 12356 NA

SUBJECT FY-1915 ESF PAAD (PRIVATE SECTOR EXPANSION II-

- THE DOMINICAN REPUBLICS SIZE AND LOCATION UNDERSCORE THE COUNITRYS IMPORTANCE TO US CARIBBEAN REGIONAL INTERESTS THE U$ NATIONIAL INTEREST IS PROMOTED AUD SUPPORTED OY A DEMOCRATIC DOMIINICAN REPUBLIC WITH AN OPEN GROWJNG ECONOMY AND A CONTINUANCE OF POSITIVE RELATIONS WITH THE UNITED STATES OF EQUAL IMPORTANCE ISTHE SUCCESSFUL MANAGEMEINT BY THE OCMINICAN

REPUBLIC OF ITSIMMEDIATE FINAIICIAL CRISIS THE CONTINUED IMPLEMEIITATION OF AN ECONOMIC ADJUSTMENT PROGRAM WHICH DIRECTLY LEADS TO RECOVERY AiD SELF-SUSTAINING GROWTH AN EXPANSION OF THE PRIVATE SECTORS ROLE IN DEVELOPMENT AND AllIMPROVED INVESTMENT AND TRADE CLIMATE

I ESF OBJECTIVES

- BASED ON THE INITIAL ADJUSTMENTS TAKEN THIS YEAR AND THE APPARENTLY STRONG DEMAIND FOR CREDITS IN SUPPORT OF EXPORT PROJECTS THE POST-1935 PERIOD MUST BE ONE INWHICH NON-TRADITIONAL EXPORTS GROW INABSOLUTE AND RELATIVE IMPORTANCE THUS PERMITTING THE NATION TO ENTER THE NEXT DECADE WITH A STRONG EFFICIENT EXPORT BASE THIS EXPORT ORIENTATION ISCONSIDERED FUNDAMENTAL TO ACHIEVING ECONOMIC RECOVERY FROM THE CURRENT ECONOMIC CRISIS WHILE MOVING THE DOMINICAN REPUBLIC TOWARD BROAD-BASED SELF-SUSTAINING GROWTH AND DEVELOPMENT

THERE IS A SUBSTANTIAL MEDIUM-TERM COST IN TERMS OF SLOW GROWTH MONETARY RESTRAINT AID FURTHER PAINFUL ADJUSTMENTS TO ACHIEVE MARKET-ORIENTED EXPORT-LED GROWTH AND DEVELOPMENT THE ROLE OF USAID AND OTHER USG PROGRAMS WILL BE OF GREAT IMPORTANCE IN ENABLING THE GOOR TO SUCCEED INIITS EFFORTS TO CREATE NEW FOREIGN EXCHANGE EARNING OPPORTUNITIES ESF BALANCE OF PAYMENT (BOP) GRANT SUPPORT WILL MAKE A MAJOR CONTRIEUTION TO CUTTING THE CURRENT ACCOUNT DEFICIT AND ISESSENTIAL TO PERMIT PRIVATE SECTOR INVESTMENTS WHICH ARE FINANCED BY COUNTERPART LOCAL CURRENCY INFY-1986 CONTINUATIOII OF PREVIOUS AS WELL AS NEW CONDITIONALITY WILL BEREQUIRED TO ENCOURAGE PRIVATE SECTOR INVESTMENT THROUGH CREDIT CREATION TAX MODIFICATIONS EXPORT RESTRICTION LIBERALIZATIOI AGRICULTURAL PRICING REFORMS AND GOVERNMENT LAND ACCESS AND THROUGH SUPPORT TO THE FINANCIAL STABILIZATION POLICY FUTURE YEAR COIIDITIOIALITY ISRECOMMENDED TO PREPARE A BASIS FOR REORGANIZIIG PUBLIC ENTERPRISES SIMPLIFYING OIIEROUS CUSTOMS PROCEDURES PERMITTING A BETTER UTILIZATION OF

SANTO 13207 92 OF 12 222046Z 5607 GS045 A1o PUBLIC LANDS MODIFYING THE IMPORT SUBSTITUTION LAW AND ENCOURAGING PRIVATE SAVINGS

THIS PARD AND POLICY DIALOGUE AGENDA EMPHASIZE TWO CRUCIAL BUTEXTREMELY DELICATE BALAIICESONE CONCERNS THE NEED T0 MAINTAIN MONETARY DISCIPLINE UNDER THE STABILIZATIONPROGRAM WITHOUT BEIN1GSO CONTRACIIOHARY AS TO PREVENT7 INVESThENT NEEDED FOR ACHIEVING RECOVERY THE OTHER ISTHE ENCOURAGEMENT CF FURTHER NEEDED REFORMS MAIY OF WHICH MEAN PAINFUL ADJUSTEIINTS WHILE NOT PROVOYING WIDESPREAD DISSATISFACTION AND SOCIAL DISRUPTION THIS REOUIRES

TIMELY AND CAREFUL PLANNIIIG OF REFORMS WHICH WHENEVER POSSIBLE SHOULD ATTEMPT TO AMELIORATE THEIR MOST

NEGATIVE SOCIAL IMPACTS

CT 1986 WILL BE CRUCIAL FOR THE DOMINICAN REPUBLIC NATIONAL ELECTION2 ARE SCHEDULED FOR MAY THE GODRS ECONOMIC POLICIES ANDTHE COUNTRYS ECONOMIC PROSPECTS WILL BE THE CAMPAIGNS CENTRAL TMEME A SUCCESSFUL POLITICAL TRANSITICON TO A NEU GOVERIMENT IN AUGUST 1986 WILL REINFORCE THE COUNTRYS STEADY PROGRESS

TOWARD SUSTATNIN AtOPEN ECONOMY BASED OftA SOLID DEMOCRACY FAILURE OF THE ELECTORAL PROCESS POSSIBLY ACCOIIPANIED BY POLITICAL AND CIVIL INlSTABILITY CLEARLY WOULD WORSEN THE OUTLOOK DESPITE THE SERIOUS PROBLEMS THE COUNTTRY FACES THERE EXISTS N1OWGENUINE OPPORTUNITY FOR THE DOMINICAN REPUBLIC TO INCREASE EMPLOYMENT IJIVESTMENT PRODUCTIVITY AND FOREIGN EXCIIANIE EARNINGS US ESF ASISTANCE SHOULD HELP THE COUITRY TAKE ADVANTAGE OF THAT OPPORTUNITY

II POLICY CHANGES UNDER FY 1935 PRIVATE SECTOR EXPANSION

IIGRANT (517-0171 AME DIED)

UNCLASSIFIED

L ki Lla Lit2 9 W~ i - ii j 4 u k u

ACTI oi UN1CLASS IFIED 1NCOMING copY Damppcrtn i ( TELEGRAM

PAGE 81 SANTO 13287 13 OF 12 222047Z 6675 369345 AID9338 SANTO 13kG1 03 or 12 2220471 6675 969048 AID ACTIONl AID-O0 GREATEST EXTENT POSSIBLE FURTHER AID WILL REQUIRE

THAT THE GDR [IJUICIATE A POLICY OFNOTRESTRICTING ACTION OFFICE LAD-03 EXPORTS ANDTHAT IT ESTABLISH CLEARLY DEFINE PROCECURES INFO FPA-02 AALA-01 LACO-D1 LADP-94 PPPB-92 GC-91 GCLA-03 FOR IMPOSING RESTRICTIONS THAT VILL NOT BE APPLIED TO

GCFL-I1 PPDC-81 STAG-02 SAST-OL PVC-02 ES-9l AGRI-91 EXISTIN6 CONTRACTS STFA-01 TRSY-GS RELO-Ol LACA-03 1936 At X25 - 3 THEIIISSION WILL ENCOURAGE THE GOVERNMENT

INFO LOG-O0 COPY-01 CIAE-0 EO-02 ODE-GO ARA-O0 909 W TO ABANDON ADAIINICTRATIVE PRICE CONTROLS IlFAVOR OF ------315104 222121Z 60 MARKET OFTER11INED PRICE LEVELS THE OFFICE CF PRICE

P 222014Z NOV 85 COIITROL SETS AND MONITORS THE RETAIL PRICE CFSSME 119 FM AMLIIBASSY SANTO DOMINGO BASIC CONSUMER ITEM ALTHOUGH EIIrORCEMENITVA RELAYED TO SECSTATE WASHOC PRIORITY 1438 RECENTLY PRICE CEILING ARE A DISINCENTIVE 70 DOMEStIC

PRODUCTIONIAIIDINVESTMEAT SINCE THEDOMINICAN REPUBLIC UNCLAS SECTION 03 OF12 SANTO DOMINGO 13287 ALWAYSHASHADPRICE CCNTROLS Ill THE PAST IT WOULDNOT

BEREALISTIC TO EXPECT THE4OVERNMEIIT 70 ABAIO11 TOTALLY AIDAC ITS PRICE CONTROL POLICIES DURIIIG AllELECTION YEAR THE

MISSION WILL HOWEVER REQUIRE -E GOVERPIMEHTTO REMOVE PASS TO ARACAR PRICE COITROLS AIIDSUBSIDIES ONTHEPL-4amp9 TITLE I

COMMODITIES AND THEIR DERIVATIVEt OF THE SAMEGRADE AND E0 12356 HA DUALITY

SUBJECT FY-1986 ESF PAAD (PRIVATE SECTOR EXPANSION II- B PRIVATIZATION AND AGRICULTURAL DIVERSIFICATION

THE MlSIO4 HAS ENCOURAGED01O VILL COITIhUE THEMISSION WILL SEEK POLICY CHANGES DURING TOURGETHE GOVERNMENTACTIVELY TOPRCMOTEA3

FY-1936 INTHREE BROAD CATEGORIES REDUCTIOII OF GOOR FACILITATE PRIVATE SECTCR ACTIVITIES AND TO PRIVATIZE INTERFEREIICE INTHE WORKINGS OF MARKET FORCES PUBLICLY-OWNED AGRICULTURAL AND NOII-AGRICULTURAL ENCOURAGEMENT OF PRIVATIZATJON OF PUBLIC ENTERPRISES AND PRODUCTIVE ASSETS ONE OF THE MAJOR ECONOMIC PROBLEMS PUBLIC LANDS AND INITIATION OF TAX STRUCTURE AIID ISTHE LARGE PUBLIC SECTOR DEFICIT EXPEIENCE BY THE CUSTOMS REFORM THREE LARGEST PUELIC SECTOF ENTITIES CDE INESPRE AND

CEA THESE COMPA1IES MUST IMPROVE THEIR OPEF4TIOtAL A GOOR INTERFERENCE ON MARKETFORCES EFFICIEIICY ANDREDUCESUBSIDIES ANDTRANSFER FROMTHE

GOVERNMENT THE GODR IIEECSTO REDUCE EXCESSIVE

ADHIIIISTRATIVE INTERFEREICE WITH MARKET FORCES AID 1 THEIIISIOI WILL REOUIRE THAT CEA ACTIVELY ENCOURAGES AND WILL CONTINUE TO URGE THE GOVERNMENT TO MAKE RAPID PROGRESS TOWARD ESTABLISHING AllECOIOIY BASED ON MARKET FOaCES EXCESSIVE CONTROLS AID RESTRICTIONS CREATE UNCERTAINTY AND REDUCE INCENTIVES FOR PRODUCTION INVESTMENT AND EXPORT AND RENDER DOMINICAN PRODUCTS NOI-COMPETITIVE INWORLD MARKETS

1 THE MISSION WILL SEEK TO REDUCE EXPORT TAXES EXCHANGE UNIFICATION RESULTED INLARGE TEMPORARY OPERATING LOSSES TO THE CENTRAL BANKCDEAND GOVERNMENT TO COMPENSATE AND FINANCE THE DEFICITS THE GOOR DECREED A TEMPORARY EXPORT TAX OF 36 PERCENT ON TRADITIONAL EXPORTS AND SOME SERVICES AND 5 PERCENT ON NON-TRADITIONAL EXPORTS AS THE EFFECTS OF THE EXCHANGE UNIFICATION WORK THROUGH THE SYSTEM HIGHER COSTS OF -

PRODUCTION MAKE DOMINICAN PRODUCTS LESS COMPETITIVE AND REDUCE EXPORT INCENTIVES REALIZIIG THIS PROBLEM PRESIDENT JORGE BLANCO ArINOUNCED ON OCTOBER 24 1985 THAT THE GOVERNMENT WOULDELIMINATE THE5 PERCENT EXPORT TAX ONNON-TRADITIONAL EXPORTS ANDSIGNIFICANTLY REDUCE THE 36 PERCENT TAX ON TRADITIONAL EXPURTS

2 THE MISSION WILL ENCOURAGE THE GOVERNMENT JO REDUCE AND LIMIT THE NUMBER OF COMMODITIES PROHIBITED UNDER EXPORT OR QUANTITY RESTRICTIONS THE IMPORT SUBSTITUTION POLICY STRESSED SATISFYING DOMESTIC DEMAND AND EXPORT PROHIBITIONS OFTEN WERE IMPOSE0 WHENEVER SHORTAGES OCCURRED- THE GOVERNMEINT CURRENTLY HAS SOME 17 COMMODITIES UNDER EXFORT RESTRICTIONIS PRIMARILY AGRICULTURAL PRODUCTS SUCH RESTRICTIONS DISCOURAGE THE DEVELOPMEIT OFNON-TRADITIONAL AGRICULTURAL EXPORTS REMOVAL OF THESE RESTRICTIONS WOULD INCREASE INCENTIVES TO AGRICULTURAL DIVERSIFICATION AID WILL PEQUIRE THAT THE GODR REVIEW THE LIST orCOMMODITIES WHOSE EXPORT IS RESTRICTED AID REDUCE THE NUMBER Of COMMODITIES TO THE

UNCLASS IFIED I q

ACTI ON UNCLASSIFIED IGNCOM I1G CON 23i2970e4lF1 Dq)- TELEGRAMY oJf S1a

PAGE It SANTO 13291 94 OF 12 222948 6521 69151 AIDS326

ACTION AID-90

ACTION OFFICE LAORAIf INFO rPA-02 AALA-01 LACO-O1 LADP-04 PPPI-02 GC-91 GCLA-93

GCFL-91 PPDC-01 STAG-92 SAST-9l PVC-02 ES-I1 AGRI-I1 STFA-BI 7RSY-IS RELO-01 LACA-03 1936 At X26

----------------------------------------------------------------INFO LOG-Il COPY-01 CIAE-00 EB-O8 DODE-00 ARA-O0 009 V

-------------- 315133 222114Z 50 P 222014Z NOV as r1lAMEMBASSY SANTO DOMINGO TO SECSTATE WASHDC PRIORITY 1431


AIDAC

PASS TO ARACAR

EO 12356 NA


SEEK TO LEASE ITS SUGAr LAND TO PRIVATE INVESTORS FOR MCRE EFFICIEIT AiD PRODUCTIVE UTILIZATION SUCCESSFUL AGRICULTURAL DIVERS1FICATION ISA KEY ELEMENT OF AIDS ASSISTANCE STRATEGY THROUGH POLICY DIALOGUE WITH-GOVERNMENT DECISION-MAKERSAID WILL ENCOURAGE THE GOOR TO EXPEDITE THE PRIVATIZATION OF CEA LANDS DURING 1986 INTHIS RESPECT THE GCVERIIMENT WILL COMPLETE THE

NATIONAL SUGAR FOLICY ANIDDIVERSIFICATION PLAN EARLY IN 19oG

2 THE MISSION ACTIVELY PROMOTES PRIVATE ECONOMIC ACTIVITIES THROUGH PROVISION OF CREDIT PROGRAMS INRECENT YEARS THE SHARE OF CREDITS AVAILACLE TO THE PRIVATE SECTOR DECLIIED AN INCREASING SHARE OF AVAILAELE GODR CREDITS WAS DEVOTED TO FINANCE PUBLIC SECTOR DEFICITS ALL LOCAL CURRENCY GENERATED UNDER THIS PROGRAM WILL BE USED FOR PROJECTS AND ACTIVITIES THAT DIRECTLY ASSIST PRIVATE SECTOR DEVELOPMENT OF THE 150 MILLION PESOS THAT SHOULD BE GENERATED 95 MILLION WILL GO DIRECTLY TO PRIVATE SECTOR BENEFICIARIES WHILE 55 MILLION PESOS WILL GO ThROUGH GOVERNMENT FOR PROGRAMS PORTSINSTITUTIONIS (ROADS ENERGY) THAT ARE NEEDED FOR PRIVATE SECTOR GROWTH OF THE TOTAL LOCAL CURRENCY RESOURCES AT LEAST 53 MILLION PESOS WILL BE MADE AVAILABLE FOR PRIVATE SECTOR CREDIT

- 3 THE MISSION ISENCOURAGING THE TOODOR ABANDON INESPRES MONOPSONY AND MOIIOPOLY POWER FOR RICE

TRADE INESPRE HAS COMPLETE CONTROL OVER RICE TRADE ITSETS THE RICE PRICE FOR FARMERS MILLERS AND RETAILERS ITISTHE SOLE AGENT AUTHORIZED TO ENGAGE IN THE RICE TRADE CURRENTLY IlESPRE INCURS A LOSS OF RD PESOS 1930 FOR EVERY 100 LB BAG OF RICE SOLD BECAUSE OF ARTIFICIALLY LOW PRICES SET FOR THE CONSUMER AID WILL REQUIRE THAT PL-480 TITLE I RICE BE HANDLED SOTHAT IT IS OUTSIDE INESPRE CONTROL THUS REDUCING INESPRES

IONOPSONY AND POWERMONOPOLY

- 4 THE MISSION WILL ENCOURAGE HIGHER MANAGEMENT EFFICIENCY OFTHE PUBLIC SECTOR ENTERPRISES T0 REDUCE THE DRAIN OIlPUBLIC RESOURCES AID WILL FINANCE A COMPREHENSIVE STUDY OilOPERATIONAL EFFICIENCIES OF THE PUBLIC SECTOR ENTERPRISES WITH AN INITIAL FOCUS TOWARD DIVESTITURE

- C TAXSTRUCTURE AND REFORMCUSTOMS

SANTO 13207 04 OF 12 222949Z 6621 51ID

TO BECOME COIPETITIVL INTHE WORLD MARKET THE DOIIINICAN COIIOMY All OF ITS CURRENT TAXNEEDS OVERHAUL STNUCTURE MORE 60 PERCENT RESOURCEStHAI OF GOVERNMENT COMES FROM FOREIGN TRADE TAXES IIIADDITION TO THE ADMINISTRATIVE COMPLEXITIES EXPORTER- ARE TAXED ON THEIR RAW MATERIAL INPUTS THUS MAKING THEIR EXPORTS EVEN LESS COMPETITIVE SUCH A TAX SYTEM REDUCES EXPORT INCENTIVES AND TENDS TO BE COUNT ER-PRODUCTIVE FOR EXPORT EXPANSION THE MISSID WILL URGE THE GOVERlMENT TO UNDERTAKE A COMPREHFIIXE STUDY TO SEEK AliALTERIIATIVE SYSTEM OF TAXATION BAE OilPROFIT- EARNED AND UNEARNED INCOME AND SALES TRAN-kCTIOIIS RATHER THAN TAXATION ON PRODUCTION INPUTS

I1 ESF PROGRAM TRANCHES

- INNEGOTIATIONS WITH GODR OFFICIALS ON THE FY-1986 ESF PROGRAM WE HAVE EMPHASIZED THE IMPORTANCE OF THE GODR CONTINUING TO IMLSEENT ITSSHORT TERM STABILIZATION PROGRAM IIIFORMED OF OURA14HAVE THEM DECISION TOTRAN4CHE IN ORDER THEOtERSEMETS TOENSURE GCOR COlPLIES WITH CCizTION AN1D SPECIFIEDCOVENANTS 1N

THE ESF AGREEMENT FU1HERMORE WE HAVE POINTED OUT THE DIFFICULTIES ASZOCIATE WITH COMMITTII5 THE FULL 50 MILLION DOLLARS EARLY INFY-ISE5 BECAUSE OFRESTRICTIONS UNDER THE CONTINUING RECLUTIOI AND CUR INABILITY TO SPECIFY TOTAL ESF AVAILABILITY IN THE ASENCE OF AN AID APPROPRIATION INTHIS CONTEXT WE PROPOSE T0 DISBURSE TYE 10 MILLIOn| DOLLAR il TWO TRAlJCHEt THE FIRST BEFORE DECEMBER 31 15ca AND THE SECOND BY MARCH 15 19E6 AFTER THE GODR H CE LATISFACTORYM3[1STRRATLO COMPLIAIICE WITH CONDITDIN AND COVENANTS AGREED TO EARLIER AS OUTLINED BELOW

- THROUGHOUT OUR DICUSSIONS GODR OFFICIALS HAVE

UNCLASSIFIED q

ACTiOI O IUNCLASSIFIED

COPY Depatllelloj TELEGiAM PAGE 01 SANTO 13287 15OF 12 222049Z 6635 fH9252 AID932S ACTION AID-D0

-ACTION OFFICE AR INFO FPA-02 AALA-91 LACO-91 LADP-D4 PPPB-02 GC-01 GCLA-03

GCFL-I1 PPDC-91 STAG-92 SAST-O PVC-02 ES-A1 AGRI-I-STFA-91 TRSY-95 RELO-0t LACA-03 036 Al X26

-------------------------------------------------------------INFO LOG-9 COPY-91 CIAE-09 EB-08 DODE-0O ARA-E0 009 V

----------- 315153 2221151 69 P 222014Z NOV 85 FM AMEMBASSY SANTODOMINGO TOSECSTATE WASHOC 1432PRIORITY


AIDAC

PASS TO ARAICAR

EO 12356 NA

SUBJECT FY-196 ESF PAAD (PRIVATE SECT0R EXPAIISION 11-

EMPHASIZED REPEATEDLY THE EXTREMELY DIFFICULT SITUATION THE CENTRAL BANK FACES INMEETING ITS1985 YEAR EIID CELIGATIONS ArNDINCOMPLVIIG WITH NUMERICAL TARGETS SET UNDER THE APRIL 1985-APRIL 19E6 IMF STANDBY PROGRAM WHILE THE AMOUNT HAS VARIEDOVER THE LAST TEN MONTHS GOOR OFFICIALS 10WNOTETHAT THECOUINTRYS PROJECTED BALANCE CFPAYMENTS IS IN THEAREAGAPFORISI5 OF135 MILLIOII CCLLAR EVEN ASSUMIIIG DISEURSFMEIIT OF THE ENTIRE 50 MILLION DOLLARS IlESF IIICY-1995 GOR OFFICIAL IICLUDING PRESIDENT JORGE BLAICO INHIS CONIVERSATIOII WITH PRESIDENT ONOCTOBER IN NE REAGAN 23 YORK HAE RECUESTED BEFORE 310ISBURSEMENT DECEMBER 1985 OFTHEENTIRE 50 MILLIONlEXPECTED DOLLARS

THEMISSION HASREPEATEDLY POINTED OUTTHAT THE GCDR MUST TAKE ADJUSTMENT MEASURES BETWEEN NOWANDTHE END OF THE YEAR IN ORDERTOMEETITS OBLIGATIONS AND IMF TARGETS WEHAVEPOINTED OUTTHAT WITH A FREE MARKET (UNIFIED) EXCHANGE BANKSRATETHECENTRAL CASH

POSITION ATYEAR BALANCE UhDERTHEEND MUST THAT STANDBY PROGRAM BANKCANNOT IN THE THE CENTRAL INTERVENE EXCHANGE MARKET THEEXCHANGE ANDTHATTO INFLUENCE RATE COMPLIANCE WITH THEIMFTARGETS IN A SINE QUA NON TO IPPLEMENTING THEALREADY NEGOTIATED COMMERCIAL AND OFFICIAL (PARIS CLUB) DEBT RESCHEDULING INORDER TO DETERMINE BETTER THE MAGNITUDE OF THE GOORS BALANCE OF PAYMENTS GAP AS WELLAS TO ENSURE THE0DRTHAT WOULD BEABLE TOMEETIMF PERFORMANCE TARGETS IN THE ABSENCE OF THE FULL 50 MILLION DOLLARS BEING DISBURSED THIS YEAR WEREQUESTED THAT THEGOORPROVIDE USWITH DATA ONl NOWTHESE COULD ASSUllIG CY1985TARGETS BEACHIEVED DISBURSEMIEITS OF30 MILLIOII 40 MILLION AND50 MILLION DOLLARS

- ONNOVEMBER THECENTRAL PROVIDED18 BANK ROJECTIONS TO DECEMBER 31 19S OFTHECENTRAL BANKS CASH FLOW AND HET FOREIGN ASSETS POSITION Il SUMMARY THESE ESTIMATES PROJECT A CASH INFLOW OF 10436 MILLION DOLLARS DURING 1985 AND ANlOUTFLOW OF 11412 MILLION DOLLARS THUSINCREASING NETASSETS BY MIIIUS 976 MILLION DOLLARS THERESULT PROJECTIONSOFTHESE WHEN COMBINED WITH PRIOR YEARBALA1CES WOULD OFBEA TOTAL 1679 MILLION INGROSS ASOF DECEMBER DOLLARS ASSETS 31 1995 5825 MILLION DOLLARS INGROSS LIABILITIES AND NET ASSETS OF MINUS 4146 MILLICOi UNDER THESE PROJECTIONS WHICH THEDISBURSEMENT OF50 MILLIONASSUME DOLLAR^ IN ESF FUNDS THEENDIF THE YEARBEFORE THE

SANTO 13t97 05 OF 12 2229I9Z 6535 89A052 AID93 GODR STILL WOULD EXCEED HE DECEMBER 31 TARGET OF NET FR EIGN AIS OF NEw TIVE 280 MILLICII DOLLARS BY 135 MILLION DOLLARS

HOWEVERTHECEIITRAL BANKS NOVEMBER18 PRESENTATION SPELLED OFMEASURES THEOUTA SERLES WHICH GODR COULD TAKE IIIORDER TO INCREASE CASH INFLOW AND REDUCE ALTHOUGH THE CENTRAL BANK HASORDEFER PAYMEIITS NOT SPECIFIED THE FINANCIAL CONSEQUENCES OF EACH MEASURE BANK OFFICIALS HAVE ESTIMATED THAT A COMBINATION OFTHESE MEASURES WOULD THENETIMPROVE FOREIGN ASSETS LEVEL BYAPPROXIMATELY 135 MILLION DOLLARS THE ACTIONS PROPOSED AND THEIR ESTIMATED ADDITIONAL CASH INFLOWSAVINGS (WHERE IDENTIFIED) ARE AS FOLLOW

A COLLECTING FOREIGN EXCHAIIGE RETAINED BY COMMERCIAL BANIS FROM EXPORT PROCEEDS (APPROXIMHTELY I0 MILLIOrl DOLLARS)

B INCREASING DIEUREMENT FF0l THE hIDS ONGOING INDUSTRIAL REABILITATIOl PAOGRhII LOAN

C INCREASING PENDING IBRD DI0SLQRSEMENTS

- 0 AUGMENTING THE DEPOSIT OF EPORT RECEIPTS E DEFEARING OpEUTS ON FOFFI E)PhriGE

- ALLOWANCE ERTIFICATES (E HILLIO DOLLARS) F POSTPONING PAIMENTS UNDER THE IIIIERBAdK

FINANCIAL COOPERATION1 AGREEIENT (UP TO 234 MILLION DOLLARS)

G0 DEFERRING PYMENTS UNTIL JAIUARY OF IIITEREST TOMEXICO -DVENEZUELA UCER THESANJOSE AGREEMENT S2 MILLION DOLLAPS)

H REHEWING T-E CCORS LINE OF CREDIT WITH shy-LADEX IeMiLLION DOLLAR)

I POSTPOUING UNTIL JAIUARY THE DISBURSEMENT OF FUNDSFOR UNDER ID LOANIfiFFATUR A

UNCLASSIFIED

a i iIIi T LIamp1 -_ J 111 L I

ACT I OlE_ IVNCCLSS1NlG COPY w Inuit TELEGRAIM

PAGE It SANTO 13207 O5 OF 12 265013Z 6575 11S55 AIDITS SANTO 13207 6 OF12 260o6Z 6379 0Mos4 AIDI| ACTION AIO-19 RELUCTANT TO REQUEST A VWIV[R AT THIS TIME EVEN THOUJ4H

--------------------------------- I------------------------ INE IMrHASEXPRESSED A WILLINGIESS TO COIIOER SUCH A ACTION OFFICE UAti- VAIVER If OTHER ADJUSTMENT MEASURES 00 OT ACHIEVE THL

INFO FPA-12 AALA-I LAOP-94 PPPi-02 GC-91 GCLA-61 CCFL-I TARGETLEVEL WEBELIEVE TE DOMINICANS WOULDULTIMATELY PPOC-I STAG-$i SAST-8I PVC-92 ES-Il AGRI-91 STFA-11 SEOUEST THAT THE IAGET It REVISED TIST-IS RELO-I1 LACA-I3 035 Al X2

- A WE NAVE CONSIDERED DIVIDING THE TRANCHES INTO

INFO LOG-$ COPY-11 CIAE-90 [-Il DODE-I1 ARA-11 M11 V DISBURSEMENT OF 20 MILLION DOLLAR IN 11S AND 20

---------------- 141614 261311Z 23 MILLION OCLLAR IN lIMS iE O0 NOT BELIEVE IT WOULD BE P 222TZ NOV I POSSIBLE EITHER POLITICALLY ORECOIIOiICALLY TO FM AMEMBASY SANTO DOMINGO INCREAE THE CASH ADJUSTMEN( DURING 11S f Al

TO SECSTATE WASHOC PRIORITY 1433 ADDITIOMAL 19 MILLION DOLLARS IETO LMIESF

OISIURSEMlNT TO 39 MILLICN DOLLARS IN 1915 THE UNCLAS SECTION 16 OF 12 SANTO DOMINGO 132317 IASURES THAT THE COOR ALREADY INTENDS TO IMLEMENT WILL

BEUNPOPULAR AIJODIFFICULT TO PUT INIPLACE

AICAC FURTHERMCRE THEY MUT SE CARRIED OUT IN A SHORT TIME

FRAME DURING A PERIO IN WHICH THE CENTRAL SAIIKS PASS TO ARACAR OPTIONS ARE SEVERELY LIMITED A OJMBEF OF THE MEASURES

APESUBJECT TO THE PERFCPMAICE CF OThERS OUTItE THE

EO 12356NA CENTRAL BANK CCIITROLC01PELLIING THE OOR TO MAKE SUIJ FY-ISS5 ESFPAAO(PRIVATE SECTOR EXPASIOH II- FURTHER SACRIFICES UIDERAN ALFEAD STRAINIED SITUATION - GRANT $17-1171 AMEIDED) WOULD HOT BE HELPCUL IN VIEW tF OUR OVERALL INTEREST IN

MAINTAINING GOOR COMPLIAINCE WITH THE ECCNCMIC - THESE MEASURES REPREE[IIl A COMPREHENSIVE RANGE OF ST1ampSLIZATIC PRCVP0FUqTHEF-IQf DELAihG 1HE

THE OPTIOIS AVAILABLE 7 THECC7ERIIEIIT TO PEtIIf III O]SJPEMEIIT OF THE 10011IOlIkL 10 MILLIOH DOLLARS TO COPLIAICE WITH THE ECCIOTiC TgBiLIZATIOI PROGRAM MAC d 1165 iOULO Ot TIERI-4LV INCREASE OUR FOLICY NONETHELESS ANOTHERMEANS OF REDUCIINGCASHOUTFLOWBY LEVERAGE IN SECURING 0OCRACTICOOF THE CONDITIONS A10 REDUCING OR DEFERRING PUBLIC SECTOR IMPORTS HAS NOT BEEN COVENANTS ASSOCIATED WITH THE SECOIIDTRAIICHE IICLUDED THE GOOR MAY HAVETO CO SIDER THIS AS ANOTHER

ALTERNATIVi-L0PDIVG CJTHE tJCCES OF THE OTHER IV EF CCIDITICIALITY STRUCTURE GOALS AND

MEASURES IT SHOULDEEt-[COIIIZ[G HtT THEoCINT OF BENCHMARKS SAVINGS OR ADDITIONAL IPSOCFStLTIl FRCM EACH MEASURE

CANNOT BE DEERIED WITH PREICIJ AT THIS TIME THE - THE PRORAM WILL TRANCHE DCLS 50 MILLION Of ESF AMOUNT Of FUICS GENERATED eY OPE rECURES SUCH A RESOUCES III TWOSEPARATEDISBURSEMENTS WITH BENCHMARK IIjCREASIIIGOiPURErSIT FPOI GSIl BID AoI3RO

LOAN1SARE CONTINGENT UPOi THE TIO1 O IMPORTERS OR OTHERS OUTSIDE THE CENTRAL AKSCOITROL OTHER

MEASURES SUCH AS DErEFRIN P~frE[TS UNDER THE SAN JOSE

AGREEMENT OR RENEWING THE LINE OF CREDIT WITH BLADEX ARE

SUBJECT OT FINITE LIMITS IIEVERTHELESS ALTOUGH THERE

MAY BE CHANGES IN THE AMÛIITCF FUIDS ASSOCAITED WITH

EACH MEASURE THE COMBIhEC RESULT HOULO BE REDUCTION IN NET INTERNATIONAL ASSETS IN 1985 EY AT LEAST 135

MILLION DOLLARS THIS WILL EliIELETHE OOR TO COPLY

WITH THE IMF PERFORMANCE CRITERIA OF NET INTERNATIONAL

ASSETS Or MINUS 210 MILLO1 DOLLARS AS OF DECEMBER 31

ISIS

- IN ORDER TO INSURE GODR COMPLIANCE WITH ESF

CONDITIONALITY WHILE AT THE SAME TIMENOT CAUSE THE

D0R TO FAIL TO MEET IS DECEMOER 31 PERFORMANCE

CRITEqIAII WE PROPOSETHATTHE FIRST DISBURSEMENT TRANCHE

TO BE MADE BEFORE THE END OF LECEMBER SE FOR 40 MILLION OOLLAIS WITH 19 MILLIC-i OCLLARS HELD TO ENSURE

COMFPIANCE WITH THE CCOITIOII ampDCONVENAIITS IN A SECOND iCAmCHE OIlIARCH I 1536 THIS WILL REOUIRE ADDITIONAL

CASH MANAGEMENT rEASLRES TOTALING I MILLION DOLLARS

BEYOND THOSE ALREADY ICENTIFIED WHILE THE 60OR HAS NOT

ADVISED US OF THE STEPS IT WILL TAKE TO IIICFEASE SAVINGS BY AN ADDITIOIIAL 1 MILLION DOLLARS FROM COMMENTS MADE

BY CENTRAL BANK OFFICILLS INCLUCING THE GOVERNCR Wt

BELIEVE THIS COULD BE ACmIEVED IF NOT HOWEVER WE

BELIEVE IT SHOULD BE PGIELE TO SECURE A WAIVER S THE IMF FO NOIICOMPLIAIICE WITH OU411TITATIVE PERFORMANCE

CRITERIA SINCE THE TARWET WAS DEVELOPED AT A TIME WHEN

THE SOR RATE WAS US DOLS ONIEEOUL O1E OR SINCE THAT

TIME THE DOLLAR HAS FALLEN AGAINST THE OR AIIDAS A

RESULT THE GOOR MUST ADD APPROXIMATELY 13 MILLION

DOLLARS TO rTS LIABILITY 10 THE IMF THUS WORSENING THE

NET INIERNATIONAL RESERVE POSITION TNF 60DR IS

UNCLASS IFlED

ACTI ON UNCLASS IFIED INCOVII NG CORY Depalmn1 nil ( TELEGRAM2

PAG It SANTO 13291 17 OF 12 222049Z 6616 161 I A109330

ACTION AID-I

------------ ------- ------------------ --

ACTION OfFICE Lnt-T IIFO FPA- 2 AALA-Il LACO-i1 LADP-O4 PPPb-2 ampC-I GCLA-03

GC$L-I PPOC-I1 STAG-2 5ASI-91 PVC-92 ES-91 AGRI-i1

STFA-II TRSY-IS RELO-9I LACA-3 136 At X26

---INFO LOG-I0 COPY-l1 CIAE-Il [l-8l DODE-91 IRA-I 129 W

31166 222116Z 60

P 222014Z NOV 1S

FM AMEMIASY CAITODOMINGO TO SECSTATE WASHOCPRICRITY 1434


AIDAC

PASS TO ARACAR

12356 NNA

SUBJECT FY-1916 [SF PAAD PRIVATE SECTOR EXPANSION I1-

DATES CF DECrlE[R 15 198 FOP TOE nitUQ[ElEtjT OF O0IS

40 MILLION A33 MARCH 15 1596 FOR THE OI8PEMEIIT O

DOLS II MILLIOfl 1OTh DIuAEMEN-T WILL EE DEPELDEN UPON COflPLIATjCEWITH THE CODITI0 NS PRECEDE

FLEXIBILITY IN INC TIMING OF THE SECONID TRACNEOF OOLS

10 MILLION WILL EE AEOlED TIl l B[hEHT WILL IC

MADE UPON SATltrACTCQY CODR CCrPLI-rICE WITh ALL COI lITIOilS AND COVENANIS FOq A EC01 DIBLUFEM1i1 (IIMMEDIATELY EELOV ARETOEPRSPCO CPS FOLOJD IV

COVENAITS I IHRCUGH V AD SPECIFIC EEIISHIAPY TARGETS)

A COITICI PRECEDENIT TO FIRST OISBJRSErCnT OF

DOLS 41 IMILLIO E SF GRANT - OA DEC 15 ISIS

CP THE GOOR WILL AGREE TO RCMOVE THE S

IERCEk EXCHANGE TAX ON NON-TRADITIONAL EXPORTS NO LATER

THAN TIC END OF THE FIRST QUARTER or 1916

COVENANTS

(I THE GODRAGREES TO CONTINUE TOTO ADHERE THE MAJOR PREVIOUS ECONOMIC COMMITMENTSACJUSIMEIIT CONTAINED IN IETHE FY-11419a$ ESFAGREEPIENT

SIA) A SINGLE UNIFILD AAK[T-D(TERMIN[D

EXCHANCE RATE SYSTEM

bull S) INCREASED PETROLEUMPRICES AND

ELECTRICITY RATES

- (C) LIBERALIZED INTEREST RATES

- W) LIMITED RESERVE DEFICIENCIES IN THE

RESERVE SANK

-E) GOOR BUDGETS PREPARED AND PRESENTED IN TERMS Of THE PARALLEL EXCHANGE RATE

- (11) THE GOOR AGREES TO PROGRAM JOINTLY WITH

AID THE USE OF LOCAL CURREIICY PROCEEDS (FROM BOTH ESF

AND PL-48O TITLE I) EV JAIUARY 31 1596 ALN TO HAKE NO THIRD PARTY AGREEPNTS OR UIIDERSTANDINGS WHICHWJLD

RESTRICT EITHER THE USE OR DIBURSEMENT Or SUCh LOCAL

CURRENCIES VITHOUT THEPRIOR CONSULTATION AND WPITTEN

CONCURRENCE O THE MISSION

- (ill) THE GODP AGREES TO DEVELOP AND PUtLISN

OJECTIVE REGULATION FOR DESIGNATING EXPO4TPPODUCTS

SANTO 13211 I Or 12 223491 5]6 361 l

FOR RESTRICTION PROVIDING THE JUSIFICAION FOR

DEICRMIHILG THE OUAuTITY ANDDURATION Of THE EXPORT

(IV) INE GOO AGREES10 PROVIDE INCREASED ACCESS TO STATE UGAR COMPANY ICIAILAND ANDTO

ESTAUL151 AND PROMOTE THE COIIITIOHS AND PROCEDURES FOR FACILITATING PRODUCTIVE-PRIVATE SECTOR ACCESS TO INESE

LANDS

(V) THE G0DR AGREES 10 UIDERTAKE A COMIPRHENIVE STUDY WHICH WILL RECOMMEND A NATIONAL SUGAR POLICY AND PLAN FCR OIVERSIFICATION

1 CONDITIONS1 S(CO1PRECEDENT 10 THE

OIIIREPCNT OF DOL I MILLIGH EE GRANT - OA MARCH

1986

- CPS

1 THE GO NEID[VES TO COVEHflT I THROUGH V

AJD ENCHMARK TECETS APL BEING ACHIEVED

- 2 A SIGNIFICANT REDUCTION IN THE 36 PERCENT EXCH NGE Tl-PC qG Ef TOE (lD O TN FiRST OJARTER 1916 01 TRADITIONAL EYPORTS

- C ENCHMARKS AID SPECIFIC MEASURES AND TIMING OF

TARGET ACHIEVEMENT

(RELATIVE TO THE CONDITIONS PRECEDENT)

-1 INDICATIVE TARGETSBENCHMARK FORCONIDITIO1

PRECEDENT TO FIRT DI1SJRSEMNT

-- NDN-TRADITIONAL EXPOiTS$ INCPEASE BY 17

UNCLASSIFIED

fiIA It amp t IA 1 U L I - N 61 m U

ACTI O11 UNCLASSIFIED INCOMI NG CO Y Departmnwm oJSa- TELEGRAM

PAGE at SANTO 13207 i OF12 2214511 1661 ISIDR il 0133 SANTO 13197 IS Of 12 2221S1Z 666l 0610SI AIDS3 ACTION AID-I0 3 COVENANT III

o deg

ACTION OFFICE LLaR-a (A) TU( GOO WILL

INFO FPA-13 AALA-91 LACO-Il LADP-84 PPPI-I2 CC-I1 CCLA-13 GCFL-1 PPOC-9l STAG-92 SAST-Il PVC-I2 ES-Il AGRI-Il (I) REVIEW LIST OF COMOOMITIES VHOSE STFA-S1 IRSY-95 RELO-I1 LACA-I 136 Al A26 EXPORT ISCURRENTLY RESTRICTED AND REDUCETE NUM9EA OF

------------------ CCOMMOITIES ON THE LIST 1Y FEBRUARY 1 1136 IhFO LOG-I COPY-It CIAE-01 ES-01 DODE-98 AlA-I 191 W

31217 222111Z 60 (2) ANNOUNCE GOVERNMENT POLICY OF NOT

P 222014Z NOV Is RESTRICIING EXPORTS TO GREATEST EXTENT PO5ILE BY FM AMEIBASheYCAPTOOOIINGO FEIRUARY is I15

TO SECSTATE WASNOCPRIORITY 1435

(3) DEVELOP LEGAL PROCE2URES FOR UNCLAS SECTION It OF 12 SANTO DOMINGO 13217 PLACING COMMOOITIE ON TNE RESTRICTED EXPORT LIST

TNEE PROCEDURES MOULD IIJCLUDEAll AlOE3JTC TIME PERIOD

AIDAC FOR EXAMINING A PROPOAL TO PLACE A COMiODITY ON THE

RESTRICTED LIST PROCEOUPES FOR PUBLICLY REVIEWIIIG TUE PASS TO ARACAR PROPOSAL BEFORE IT GOES INTO EFFECT AND A PROHIBITION

ON TE OPPLICATICI OF ANY RESTRICTIO3 TO E ISTIIIG

EO 12356 NA CONTRACT BY F[BRU0RY 1 1936

SUBJECT FY-116 ESF PAAD PflIVATE SECTOR EXPANSION II- 14) PUBLISH TIESE PrOCEDUAES BY rFIRUARY 15 156

PERCENT IN 166 COIIP ED TO 9 PERCENT IN 1195 4 COVENANT IV

2 INOICNTIE BEtiCHliRN TARGETS FOR

CONDITIONS PRECEDENT TO SECOND DISBURSEMINT (A) THE GOOR WILL

-- TRAOITIOIAL EYPORT IIICREASE AT AN (11 REVISE CEA POLICY REG9POIIIG ANNUALAVERAGE OF 4 PERCET DURIIG I9M6 AS COMPAREDTO DIVERSIFICATIO11 TO RIICLUDEAUTNORITv FOR CI TO LEASE MINUS I PER ENT CURihG 190-1944 LALO 10 THE PRIVATE SECTOR WITOUT 6EGJIRilC EA

PARTICIPATIOlJ III A JOINT VENTURE BY FEMRLPY 1 3 16 COPFIIT ACCOUNT DEFICIT IMPROE BY

MORE TEAN DOLS 79 MILLIOn IN 1116 (2) DEVELOP PROCEDUES TO FACILITATE

PRIVATE SECTOR ACCESS TO CEAL0 BY FLEAEY 1 11936

C[ELA1IVE TO THE COVjhAIITI 01 PUBLISH THIS POLICY AND THESE

1 COVENANTI

WA) GOP GROWTH OFNO LESS THAN ZERO PERCENT IN 1915 AND 2 PERCENT-IN 1936

PERCENT IN 1916 AS COMPARED TO35 PERCENTIN I193

IC) OVERALL BALANCEOF PAYMENT DEFICIT REDUCEDI MORE THAN DOLS 1i MILLION IN 1916 FROMTHE DOLS 227 MILLIO DEFICIT IN 1935 BEFORE PARIS CLUBAND COMMERCIALlANK RESCNEDULING

1D) THE CONOLIDATED PUBLIC SECTOR

DEFICIT DECLINES BY NO LESS THAN It PERCENT TO RD PESOS

217 MILLION IN 1916 AS COMPARED TO RD PESOS 241 MILLION

IN is

2 COVENANT II

(A) TOTAL LOCAL CURRENCY PROCEED UNDER

THE FY-I18 ESF WILL BE DEPOSITED IN TUE SPECIAL ACCOUNT

IN THE CENTRAL BANK A TUE TRARCHES OCCUR AGREEMENT ON

THE BASIC PROGRAMMI1NG Of ALL ANTICIPATED 19l6 FUNDS WILL

BE COMPLETED BY JANUARY 31 1915

(1) ALL ESF FUNDS WILL B PROGRA(MMED FOR

ACTIVITIES WHICH NAVE A DIRECT OR IIIDIRECT IMPACT ON

PRIVATE SECTOR DEVELOPMENT SPECIAL EMPHASIS WILL BE

GIVEN TO PROVIDIIG CREDIT FOR h011IRADITIOAL EXPORT

DEVELOPMENT AND IIIVESTMENT DIVERSIFIED AGRICULTURAL

DEVELOPMENT AND SUPPORTING PRODUCTIVE INFRASTRUCTURE

UNCLASSIFIED (

L WI~k J 1- 61 A Ll ~i aA

ACT ION UtCLASS IFlED INCO itIIHG OCOPY amp2c)arllenI TELEGRAI0 510Y

PAGE 91 SANTO 13207 99 OF 12 222952Z 6666 06506AI09335 SANTO 13207 09 OF 12 222052Z amp666 16996 A1D933 ACTION AID-10 THAT 50 MILLION DOLS WORTH OF ELIGIBLE IMPORTS FOR THE

-------------------------------------------------- ACTION OFFICE LA-Ok

PRIVATE ECTOR WERE ACTUALLY RECEIVED THIS VERIFICATION TAKES THE FORK OF CUSTOMS RECEIPTS BILLS

INFO FPA-82 AALA-I1 LADP-94 PPPB-I2 GC-9l GCLA-03 GCFL-01 OF LADING CENTRAL BANA AUTHORIZATION OF FOREIGK PPDC-91 STAG-02 SAlT-01 PVC-92 ES-Al AGRI-8l STFA-91 EXCHANGE IMPORTS AND OTHER STANDARD RANKING DOCUMENTS TRSY-85 RELO-01 LACA-93 035 At X25 WHICH IDENTIFY THE TYPE OF GOOD IMPORTED THE SOURCE AND

ORIGIN AND THE US COLLAR VALUE INFO LOG-Il COPY-Il CIAE-00 EB-98 CODE-I0 ARA-00 89 U

315244 222119Z 60 2 DISBURSEMENT AND PAYMENT VERIFICATION P 222014Z NOV 85 FMAMEMBASY SANTO DOMINGO THE ESF RESOURCES VILL BE DISBURSED INTWO TO SECSTATE WASHOC PRIORITY 1436 TRANCHES OFDOLS 49 MILLION AINDDOLS 19 MILLION AS

DESCRIBED ABOVE UNCLAS SECTION 99 ampF t2 SANTO DOMINGO 13207

THEMETHOD OF PAYMENT FOR HONI-PROJECT AIDAC ASSISTANCE AUTHORIZED UNDER THIS PAAD ISDOLLAR PAYMENT

THROUGH ELECTRONIC FUND TRANSFER (EFT) WHICH IS A PASS TO ARACAR PREFERRED METHOD OF FINANCING UNDER THE ADMIISTRATORS

PAYMENT VERIFICATION POLICY STATEMENT THEREFORE NO EO 12356 NA FURTHER JUSTIFICATIN ISREQUIRED SINCE THIS IS A CASH

TRANSFER NO METHOD OF IMPLEMENTATION ISAPPLICABLE SUBJECT FY-1986 ESF PAAD (PRIVATE SECTOR EXPANSION Ifshy

- THE USAID CONTROLLER HAS REVIEWED AND PROCEDURES AND INITIATE A PROMOTIONAL CAMPAIGN TO FOSTER APPROVED THE IM1PLEMENTATIONFINANCING PROPSEDpCs INVESTOR AWARENESS BY FEBRUARY 151985 CONTAINED INTHIS PAAD

B LOCAL CURRENCY PROGRAM - I) APPROXIMATELY 22 PERCENT OF CEA LAND UNDER DIVERSIFIED PROODCTIOH EITHER INJOINT VENTURES OR 1 AS A CONDITION FOR RECEIVING THE CASH DIRECT LEASE ARRANGEMENTS TO PRIVATE SECTOR ENTITIES TRANSFER THE GODR WILL BE RECUIPED TO PROVIDE AND EITHER DOMESTIC OR FOREIGN BY THE END O 1986 DEPOSIT THE PESO EQUIVALENIT OF THE CASH TRANSFER INTO A

SPECIAL ACCOUNT AS POGRAM COUTERPART THE EXCHANGE (C)OF THE 20 PERCENTNOLESS THAN)40 RATE USED TO CALCULATE THE AMOUNT OFCOUNTERPART

PERCENT UNDER DIRECT LEASE ARRANGEMENTS REQUIRED OF THE GODORWILL BE THE AiERAGE FREE MARKET

EXCHANGERATECALCULATED BY THECENTRAL BANKFORTHE 5S COVENANT V THIRTY DAY PERIOD FCLLOWING SIGNATpoundRE OF THE AGREEMENT

(Al THE GODRWILL

(1) INITIATE A STUDY TO RECOMMEND MEASURES THE GODR MAY UNDERTAKE TO DIVERSIFY LAND CURRENTLY USED FOR SUGAR PRODUCTION BY THE END OF FEBRUARY 1986 1

V TRANSFER MODALITY AND LOCAL CURRENCY PROGRAMMING

- A CASH TRANSFER

1 USES

- THE USG THROUGH AID WILL PROVIDE BALANCE OF PAYMENTS RELIEF TO THE DOMINICAN ECONOMY THROUGH THE PROVISION OF A CASH TRANSFER TO THE CENTRAL BANK TOTALING US DOLS 50 MILLION THE FUNDS WILL BE MADE AVAILABLE TO THE GODORAS A GRANT THIS DECISION IS BASED PRINCIPALLY ON (A)THE REALIZATION OF THE SEVERITY OF THE 1986 BOP PROBLEM ON THE DOMINICAN ECONOMY AND (6)THE FACT THAT THIS ISAN4ELECTIO YEAR COMPLICATED BY THE REQUIREMENT THAT THE DOMINICAN CONGRESS APPROVE ALL LOAN AGREEMENTS VICH WOULD SURELY LEAD TO A PUBLIC DEBATE ON AID CONDITIONALITY WHICH INTURN WOULD

SERIOUSLY IMPEDE THE TIMING FOR DISBURSEMENT OF THE AID FUNDS

THE GODR AGREES THAT THE COUNTRY- WILL IMPORT FROM THE US AN EQUIVALENT AIOUNT OF RAW MATERIALS SPARE PARTS MACHINERY ANDEQUIPMENT FOR PRIVATE SECTOR USE THESE IMPORTS WILL BE BROUGHT IN

OVER THE COURSE OF ONE YEAR FROM THE DATE OF THEFIRST DISBURSEMENT OF THE GRANT TO THECENTRAL CANK DOCUMENTATIOrI WILL BE REQUIRED FROM THE GODR TO VERIFY

UNCLASS IFIED

32

ACT IO1 UNCLASSIFIED INCOMING CoP y DepartmentofSiur 2TELEGRAM

PAGE 11 SANTO 13207 IsOF 12 lll53Z 6661 169113 AID1337 SUTO 13217 11 OF 12 122ft3Z i66 16g+3 ACTION AID-l1

---------------------------------------- A 1I INV[TENT PROflOTIONEORT DEVELOPMENT4

ACTION OFFICE Ltl-Uj INFO FPA-I2 AALA-O1 LACO-11 LADP-I4 PPPI-12 CC-I GCLA-)- A SHALLSCALEBUSINESS CREDIT 3

GCFL-11 PPOC-81 STAG-92 SAlT-I1 PVC-92 [S-81 AGRI-1l - (PORT CREDIT 21 STFA-I T1SY-BS RELO-I1 LACA-93 36 At X26 - C FREE ZONE EXPANSION Is

- 0 INDUSTRIAL PaRK REHABILITATION is INFO LOG-Il COPY-Il CIAE-10 E-l DODE-I ARA-I 019 V

31252 222121Z 1 Il AGRICULTURAL DIVERSIFICATION P 222C14Z NOV SS FM AMCMIRampSY SANTO DOMINGO - A AGRIOUSINES CREDIT 30 TO SECMTATE WAPOC PRIORITY 143 - (WORKING CAPITAL)

- 1 FEASIBILITY STUDIES 2 UNCLAS SECTION 11 OF 12 SANTO DOMINGO 13217

IV SUPPORTING INFRASTRUCTURE 52 AIDAC

A PUBLIC WORKS i5 PASS TO ARACAR I1 PVO SUPPORT S

- C RESOURCE COOROINATION-PLANNING 2 EO 123S6 NA

V TRUST FUND 1 SUIJJECT FY-1SS LSF PAAD (RIVATE SECTOR EXPANSION 11

TOTAL (1) is IN TNE PAST TWO MONTHS THAT RATE HAS AVERAGED ABOUT RD PESOS 310 EQUALS US DOL 1O0 - (1)THE EXCHUGE RATE O RD PESO 310 TO US

DOLS 190 WAS USED FOR THE CALCULATION IN[ THE PROCEDURES FOR HAUDLING THE LOCAL ILLUSTRATIVE ALLOCATIC ATTRIBUTES THE TOTAL AMOUNT OF

CURRENCY COUNTERPART WERE DEVELOPED AS A CONDITION LOCAL CURRENCY FOR A YEAR HOWEVER ACTUAL DISBURSEMENT PRECEDENT TO THE DIBURE[HEfT CF THE PRIVATE SECTOR MAY BE ON A MULTI-YEAR BASIS OEVELOPMIIIT ESF PROIRAM (LOANl10 51T-1-039) THESE

bullPPOC[buiES UEE ALSO EIPLO(ED IN THE FRIVATE SECTOR 12)ANY EOLUCION MDE IN THE AMOUNTS OF

E)PA1IJ1 ESF PROGRAM 517-0171) LOCAL CURRENCY FORPROGRAMING DUETOCRAIT 110 IN VIEW Of AVAILLE IN 1981 TIR UTILITf AID ACCEPT bICE IM[EE PROLOURES WILL ALO fEOUIREMEIS IMPOSED ON THE GOOR I THE IMFWILL BE

BE FOLLOLED FOR THE LCuL CURFEICY CCWTERPART UIIDERTHE APPLIED PROPORTIONATELY TO THE PRIVATE AND PUBLIC PROPOEO PO2OA kFPCO1iIATELY 30 CAYS AFTER THE CASH SECTORS

TRANSFER IHE LOCAL CUFRENCY COUNTERPART WILL BE OEPOSITEO IN A tPECIAL ACCOUNT IN THE CENTRAL BANK

ONCE DEPOSITED THE CEhIRAL BAIlKWILL INFORM THE

TECHNICAL SECRETARY OF THE PRESIDENCY OF THE DEPOSIT AND

THE 39 DAY AVERAGERATEISED TO CALCULATE THE TOTAL

AMOUNIT Of THE DEPOSIT HE TECHNICAL SECRETARY WILL IN

TURN ADVISE USAID

- THE COUNTERPART FUNDS ARE TO BE PROGRAKMEO

JOINTLY BY THE GOON AND THE USAID THE NATIONAL PLANNING OFFICE (ONAPLAN) WILL COORDINATE THE GOOR

PLANNING AND PROGRAMING OF THE SPECIFIC USES OF THE

LOCAL CURRENCY PROCEEDS PRIOR TO THE DISBURSEMENT OF THE PROCEEDS FOR PROJECTS OR ACTIVITIES ONAPLAN WILL

SUBMIT A DESCRIPTION AND IMPLEMENTATION PLAN FOR EACH

FOR AID APPROVAL

2 ILLUSTRATIVE ALLOCATION

- THE COUNTERPART RESOURCES WILL BE PROGRAMMED IN SUPPORT OF THE USAID STRATEGY MVNICHIS

DESIGNED TO ACHIEVE THE OBJECTIVES OF ECOIIOMIC

ADJUSTMENT AID STABILIZATION PRIVAT[ SECTOR INVESTMENT

AND EXPORT PROlIObO AGRICULTURE DIERIFICATION AND

DEVELOPMENT OF SUPPORTIIG PHYSICAL SOCIAL AND

INSTITUTIONAL INFRATRUCTURE THE BASIC ALLOCATION

AGREED TO WITH THE GOOR IS AS FOLLOZ

AMOUNT (21

I ECONOMIC STABILIZATION 3

- A SAVINGS MOBILIZATION I

I AG POLICY I

C ECONIOIC ANALYSIS IC

UNCLASSIFIED -

uimIiU I L tA L iL I L Lim U1

ACTlO1 1 UN[CLASSFIED I COiI rItG COPY Deprimenn ojSt(m TELEGRAM

PAGE 91 UNTO 1327 1I O2 22205 6671 069166 A109349 SANTO 1fl31 ii or 12 2221562 6677 15566 A1091 ACTION AID-l SHALL BUSIRNMES AND CREATE 1290 JOBS BY THE END OF

131G ALSO SEVERAL PRIVATE S(CTOR ENTITIES WILL OE ACTION OFFICE IAD-n- FINANCED THAT PROMnIE INVESTMENTS AND EXPORTS INFO [PA-52 APLA-11 LACO-1I LAOP-94 PPPI-12 GC-I GCLA-) ESPECIALLY THOSE PELDAED TOTiE AIO-SUPPORTEO EXPORT AND

GCFL-61 STA(-91 SAT-Il PVC-I2 ES-Il AGRI-II SIFA-1I INVESTMINT PROMOTION PROJECTtS17-OlSi) TISY-I RELO-1I LACA-I 935 Al X26

LO C AL C U R R E N C Y F U IDS W IL L BE PRO G R AIME D INFO LOG-I1 COPY-I1 CIAE-9q E-OR DODE-1l ARA-19 19 V FOR FREE TRADE ZONE IFtZ)CONSIRUCIICI AND EXPANION

315342 2221211 50 PARTICULAPLY THOZ[ PRIVATELY MAIkGCD FTZ IN SAIiTIAGO P 2221A4Z NOV 8S LA ROMAIIA AND HAIIA ThEE EFFORT WILL RESULT IN THE FM AMEM1ASSY SANTO OOMITGO CONSTRUCTION OF AT LEAT 30 lEW BUILDING1AND THE TO SECSTATE WASNOC PRIORITY 1433 CREATION OF APPAGAIMATELY 7200 hEW JcO WHEN FULLY

OPERATIONAL COME FUIIDSWILL EE UED TC UPPORT THE UNCLAS SECTION 11 OF 12 SANTO DOMINGO 13297 REHABILITATION OF INDUSTRIAL PARK PARTICULARLY IN

AfiTOOOMIIN0 THI JILL B PLRT CF OuR EFFcOTS TO AIDAC REORIEIT SOMEPROTECTEDIPPORT SUBSTITUTION IIIDUCTRIES

TOWARDFOPEIGH MLPKET ANIORESULT IN NEWFOREIGN PASS TO IRAICA EXCHANGE EARNING

[0 123S5 NIA IIITHE APICUTURAL DIVEPIFICATIII CATEGORYC0I10IDERAELE CREDIT VILL El EITEhDETO

SUBJECT FY-11 [SF PAAD (PRIVATE SECTOR EXPANSION I - SUPPORT AGRIBUSIHEÊ RD PESOS 38 PLLION IN

COUNTERPAPTUNDERTHEACRIBUINIESS PACJECT (S17-016) - UNDERTHEECOIOMIC STABILIZATION CATEGORY WILL BE PROVIDEOFCQIJVETINTM lD0VL i C VITAL IT LOCAL CURRENCYPESOJRCES WILL BE FCORAMED F R PECIFIC WILL BE CAVIIELEO ThROUCHFIDE TO T4E Pa~iATE COYMMEfIAL PROJECTS THAT PROVIDE FORAll IIPROVE ECOIiOmI POLICY BANKS APPRCXIMATELf 4D AGRIBUINIE[f WIH All AVERAGE FOUIDATION S0 THAT THE STRUCTURAL ADJUSTMZNT PROGRAMCAN LOANSIZE Of RD PESO I29C O00 WILL LEIEFIT I1 1916 SUCCEED FOREXAMPLE THE A 10 SPONSORED RURAL TAKING INtO COHSIOERAEION ALL CREDIT ID AGRIiUSINESS SAVIIIG POSILIZATIOII 10RICLTVPE PCL ICY AS EOHC1IC PICMOTIO EFFORT W- EPECT THAT 74 1(1 jC3S WILL 1E ANALYSIS AND TRAINING PROJECTS WHICHAPEAIMED AT CREATEDA0 A TOTAL C OOLS 34 MILLICI INIFOREIGI bullPROVIOINS A4YSIS 4106JIDlICE TO HIGM LEVEL GC0R EXCHANGEWILL BE GENERIED WhEI FULLY CPEIATIONAL Vamp DECISION-PPERS ON SHOPT A VELL A MEDIUM TERM WILL ALSO FIIIAICE FEAIEILITY TUDIES I4 DIRECT SUPPORT POLICIES WILL JE ÛPPCQTEO THU Fig THE SAVINGS OF PRIVuTE SECOR I11i1EIIT THROUGH 1tE GORS MOBILIZATIONd PROJECT HAS MOBILIZED R PEOS 6 MILLION IN PRE-INVESTMEjT OFrICE THE JACC AND THE IIIVEtTMENT

SIIIG THROUGH 6-LE CF ThE ARICULTURE SAII IN PRglIOTIOIICOUIJCIL

RURAL AREAS AliEAPuNSIOII OF THIS PRCGPAM SHOULO RESULT

IN DEPOSIT SERVICES AT ALL AGRICULTURE BAtK BRAIICHES PLUS CREDIT UNICNS afOPRIVATE BJKC A A RESULT OF

PROJECT ACTIVITIES THE MOIETARY BOARD OF THE CENTRAL BANH HAS RAISED INTEREST RATES FROM5 TO 12 PERCENT FOR

DEPOSIT AND LEHOING RATESFRCI 12 TO 1 PERCENT INCREASES WHICH MORE ACCURATELY REFLECT CURRENT

INFLATIOli RATES STUDIES COMPLETED UNDER THE AGRICULTURAL POLICY PROJECT ONCREDIT ANDDAIRY PRODUCTS HAVE RESULTEO IN DECISIONIS BY THE NATIONAL AGRICULTURAL

COUNCIL THAT SHOULD DIVERSIFY CROP PRODUCTION 10 FACILITATE THE FLOW OF CREDIT TO AGRIBUSINESS AS A

RSULT OF A STUDY THEGOVERINMENTHAS INCREASED MILK

PRODUCER PRICES BY 40 PERCENT AND ELIMINATED THE SUBSIDY

ONMOLASSES THOUJGH THEECONMIC ANALYSIS PROJECT EXPECTED TO BE SIGNED LATER IN THIS FY THE GOORS

[CON1OMIC POLICY TEAMWILL BE AELE TO 0A1 ONAN ANALYTICAL UNIT TO MCODIFY TRADE Tmx MONETARY AND

INVESTMENT POLICIES S0 THAT THEY ARE CONSISTENT WITH THE

GODRS ECONOMIC RECOVERYPROGRAM

UNDER THE INVESTMENT FROMOTION ANDEXPORT

DEVELOPMENT CATEGORYCONSIDERABLE ADDITIONAL CREDIT )MICH I VERY SCARCE UNDER THE CURRENT GODR AUSTERITY

PROGRAMWILL BE PROVIDED TO THEPRIVATE SECTOR CREDIT

WILL BE MADEAVAILABLE THROUGH FIDE TO PRIVATE

COMIMERCIAt AND DEVELOPMENT BAhx FOR SHORT-TERM WORKING AND MEDIUM-TERM IHVETMIIT CAPITAL TO EXPAlD EXPORTS

TO DATE CREDIT MADEAVAILABLE FROMPRIOR YEAR [SF RESOURCES HAS FINANCED LOAN AT All AVERAGE SIZE OF RD PESOS 42S99 AND SIIPPORTEO 110 ENTERPRISES THIS HAS

RESULTED IN THE CREATION OF 1700 JOBS

WEWILL CONTINUE TO SUPPORTMALLBUSINESS DEVELOPIENT THROUGHTHEADEMI PROGRAMTHE PROGRAM WILL BE EXPANDEDA10 IS EXPECTED TO AS510 APPROXIMATELY 106

UNCLASSIFIED

WU b LdL 16 i LIti ltLW ld bd |d M

ACT 101 ULCLASSIFlED INCOMING copDejiyzl li oJl5(1 TELEGRAM

PAGEII SANTO 132O7 12 Or 12 222157Z ill K911691 A111134 ANTO 13237 12 o 12 22321sl 6618 169I61 AIDo ACTION AID-50

TIC- E-- ------------------- ACTION OFFICE LiI0

C PROGRAM 0lOlITCRING COOAOINATION A0 OVERSIGHT

INFO FPA-12 AALA-91 LACO-81 LADP-14 PPPI-92 GI-11 CCLA-)3 PROCEDURESFORMIONITORINGTHE LOCAL CURRENCY WCL-1 PPOC-8l STAG-02 SAST-i1 PVC-02 E-Il AORI-61 NAVE BEEN ETABLISNED APPEAR TOSE WORKING WILL AND TFA-i IRSY-I5 RELO-11 LACA-13 936 At X26 VILL BECONTINUED THE MAJOR RESPONSIBILITY FOR PROGRAM

MONITURIN5 ONTHE GOOP ID E RETS WITH ONAPLAS INTO LOG- COPY-11 CIAE-Il ES-I 0001-Il ANA-90 JESS V PL-4i|CUI COORDINITING OFFICE THIS OFFICE STAFFED

shy315363 2221231 69 WITH FINAUCIAL ANALYTS EIGINEIERS JO PLA1ERS P 2229MIZ NOV as EWMINES PROJECT PROPOALS CAGRIES OUTAlJOilT CONDUCTS FM AKMlASSf SANTO OC4INGO FIELD SITE VISITS AND URITEC [NO-OF-FROJECT REPORTS ON TO SECTAIE UAfHOCPRIORITY 1439 ALL PROGRAM ACTIVITIES THIS OFFICE ALSO CCNTRATS FOR

SPECIAL OUTSIDE AUDIT OF PROGRAM ACTIVITIE THE UNCLAS SECTION 12 OF 12 SANTO DOMINGO 13297 COORDINATING OFFICE WILL RECEIVE SOME LOCAL CURRENCY TO

IIICREAETHEIR ACILITf TC EFFECTIVEtY I3NITOP AlS1 ATDAC OVERSEE THE EXPANDING LOCAL CURRENCY PROGNAI

PASS TO ARACAR - OH THE USAID SIDE A LOCAL CUR(Cv PROGRAM

TEAMHA BEENFORMEDIT I M4DEUPOf TECHIiCAL 10 pound2351 NA DIVISION CHIEFS 70E PROGRAMOFFICER IME PRGGRAfl

SUBJECT FY-1i16 ESr PAAO(PRIVATE SECTOR EXPANSION II-ECONOMIST AND THE COIlTCLLER WITH TV[ PPOEC DEVELOPMENT OFFICER A COORDINATOR OR CNHIRMAN THIS TEAM JOINTLY ETA6LISH PRIORITIES SETS DIPECTIOns AND MIPE PECOMEEAtON O ALLOCAIIC4 ICOt5kfmINlG

THE SUPPORTING IhFRATRUCTURE CATEGORY TO LA0 MA4AGEIENT PE CAPIIAL RESDRCES OEYELCPMEKT ILL CONTINUE TO PLACE EmPHASIS OleFINANCING OFFICE CROO) CONTINuE TO BE THE PRINCIPAL COTCT WITH

INFRASTRUCTURE ACTIVITIES NEEDED FOR PRIVATE SECTOR OWAPLAN FOR THE LOCAL CURRENCY PROGRAM IT COORDINATES GROVTH INFRASTRUCTURE PROJECTS WHILE FUNDS FOR THES[ THE USAID PROJECT APPROVAL PROESS INCLUDING ALL ACTIVITIE WILL BE CKAHIIELE THROUGH PUELIC ECTOR CHANCES 0CIFICATIC CRDO ALO COAIELS REVIEWS

ENTITIES tUCH ASCOE INIRHI AIDC[OPC OFILfACTIVITIES OF THE PROGRAM WITH OJAPLAN AND VITHIN THE USAID 4HAT NAVE A 0ECT POSITIVE IMPAT ON THE PRIVATE MCLAUGHLIN PRODUCTIVE SECTCR WILL tE Filii[E AT L[T 150 NM OF RURAL PODS AD ECOODPY HIGhVAY WILL BE REHABILITATED

AND5 IRRIGATION CA1IALPIETWORKS WILL BE UPGRADED WITH PRIORITY GIVZI TO THE P3 CAN4LS 11AREAS OF

HIGH ARICuLTURAL PRCDUCTIVITY URGENTLY NEEDED

ELECTRICAL POJR PLAIT REHABILITATION IS EXPECTED TO

BRING AN A30lTICIIA IS KW INITOTHE NATIOnIAL GRID THEREBY INCREASING TOTAL SUPPLY BY 15 PERCENT THE PORT AT AZUA MAY BE IPPROVED TO ALLOW LARGER VESSELS TO ON-LOAD

AGRICULTURAL PRODUCTS FOR EXPOrT

ALSO LOCAL CURRENCY WILL BE USED TO

FINANCE PROJECTS AND ACTIVITIES OF US AND DOMINICAN

PRIVATE VOLUNTARY ORGANIZATIONS EMPHASIS AS BEFORE WILL Bt GIVEN TO THOE ACTIVITIES AND PROJECTS WHICH

LEAD TO SELF-UFFICIENCY FOR IHE PVO AND ITS PROGRAM OR

INCOME-GENERATING ACTIVITIES EXAMPLES INCLUDE THE DOMINICAN DEVELCPMENT FOUNDATION UFOOlROTATING CREDIT FUMD FOR ARTESANS AND THE WOMEN IN DONtICAN DEVELOPMENT

(MUDEI PROJECT FOR CREDIT AIDTECHNIICAL ASSISTANCE TO

WOMEN COOPERATIVES OR GROUPS INVOLVED IN SMALL

AGRIBUSINESS VENTURES

FINALLY THE TRUST FUND WILL BEINCREASED BY 5MILLION PESOSAND BE USED TO FINANCE ADMINISTRATIVE AltoOPERATING COSTS or UAIDCR THE TRUST FUND WILL

ALSO BEUSED FOR USAID PROGRAM SUPPORT AND IMPLEMENTATION UPSI)ACTIVITIES INITHE AGRICULTURE

HUMAN RESO(IRCEa HEALTH ANDPOPULATION AND PRIVATE SECTOR DIVISIONS INCLUDING SPECIAL PEACE CORPS SUPPORT USE OFIRUST FUND FOR THESE PURPOSES IS CONSISTENT WITH THE ADMINISTRATORS GUIDANCE TI FREE UP US DOLLAR

FUNDS HNROUGH THE UTILIZATIOI Or LOCAL CURRENCN RESOURCES TO FINANCE ADMINISTRATIVE OPERATING AND

PROGRAM SUPPORT EXPENS THE UID CONTROLLERS OFFICE

WILL MAINTAIN RECORDO01DIL DISBURSEMENTS FROM THE

ACCOUIIT AND WILL PREPARE AIIDFURIISH AN AFNUAL REPORT TO

THE GODA 01HE DEPOSITS DISBURSEMEIS AND BALANCES IN

NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W

ACTION MEMORANDUM FOR THE ACTING ASSISTANT ADMIN TR JOR (LAC)

ROM LACDR Dwight B JoglA

SUBJECT Dominican Republic Private E rpr se Sector Devlopment PAAD

Problem Your approval is required to authorize an additional $8 million from ESF funds for the ongoing Private Enterprise Sector Development program in the Dominican Republic

Background The USAIDDominican Republics private enterprise sector development program is now approximately one year into implementation In general the program is progressing well All of the $41 million in loan proceeds has been disbursed An informal review of reports prepared by the Central Bank indicates that the GODR will be able to fully comply with the covenant in the loan agreement regarding the importation of $41 million of goods from the US by the countrys private sector

During recent years the Dominican economy has suffered seriously from depressed international prices for its major products shortages of foreign exchange and constricted imports reduced revenues scarcity of credit and investment growing public sector deficits and a policy framework which has emphasized import substitution and dependence upon exports of traditional agricultural and mineral commodities

In response to this severe economic situation the government of President Jorge Blanco which assumed office in August 1982 immediately formulated both short- and medium-term strategies aimed at economic recovery These strategies were consistent with recommendations presented to the GODR by the World Bank in June 1982 calling for a narrowing of the Central governments fiscal deficit a spurring of the sagging Dominican private sector and promotion of non-traditional exports to improve the countrys foreign exchange position Although the GODR has begun planning and implementation to achieve these objectives it will take time for these remedial actions to have a significant positive impact

The GODR has demonstrated that it is determined to confront the current economic crisis In addition to its announcement and implementation of a series of economic reforms the GODR reached agreement in January 1983 with the IMF for an Extended Fund Facility (EFF) totaling $450 million over 3 years

RECORD cOPY

-2shy

beginning in 1983 It was against this backdrop that the USG and the GODR executed on September 30 1982 a loan agreement to provide $410 million in immediate balance-of-payment (BOP) support and to ease the strain of the austerity measures the GODR was committed to take

During the first half of 1983 the GODR satisfied all IMF conditions for the EFF Partly due to the GODR effort to comply with the IMF agreement the BOP situation improvedsubstantially during the January-June 1983 period The overall BOP deficit in 1983 is now estimated to be $89 million as compared to the dismal level of $337 million in 1982 This improvement however is not due to an increase in exportearnings but primarily due to the rescheduling of more than $600 million in short-term commercial bank arrearages The commercial rescheduling agreement was signed on September 15 1983 Meanwhile the GODR has proposed formally to the Government of France the renegotiation of its official debt through the Paris Club mechanism If completed before yearend this action will relieve the GODR of about $81 million in official debt service in 1983 The reduction in the overall BOP deficit however is not an indication of improvement in the economy but rather a manifestation of depressed economic activity Continued BOP assistance is clearly indicated by the fact that net international reserves have declined steadily to minus $855 million as of March 1983 indicating a severe shortage of foreign exchange and limited imports to the country

Discussion USAIDDominican Republic requests authorization of an amendment to project 517-0171 to increase program funds by$8 million to $49 million The additional funds to be made available under this amendment will be disbursed in accordance with the FY 85 CDSS and the CBI assistance strategy outlined on pages 14-15 of the original PAAD These additional resources will further assist the Dominican Republic in carrying out its recovery programs in a manner which preserves the basic tenets of a democratic society and a free market economy The rationale for a cash transfer discussed on pages 15-16 of the original PAAD is still valid In addition the covenants included within the existing loan agreement concerning the use of US dollar resources will still apply

-3-

The procedures for the use of the local currency counterpartfollowed for the initial $41 million have worked well and will be followed for the local currency under the amendment Within approximately 30 days after the disbursement of the $8 millionthe GODRs local currency counterpart will be deposited in a special account in the Central Bank for the uses agreed to under the program The Central Bank will inform the Technical Secretariat of the Presidency (STP) of the deposit of all proceeds and will advise AID This counterpart will be programmed jointly by the GODR and AID for high priorityprivate sector development needs STP will coordinate the GODR planning and programing activities Prior to the disbursement of the proceeds STP will submit for AID approval a detailed implementation plan for each project activity Under the local currency funded activities two areas of financinghave been identified by the GODR as their priority uses for these additional funds Specific allocations will be the subject of further negotiations however GODR plans and priorities for additional resources include counterpart fundingfor productive infrastructure such as (1) a key highwayproject funded by the World Bank and rural roads projectsfunded by AID and the Interamerican Development Bank and (2) expansion of the existing free zone facility at Puerto Plata

Representatives of GODR have been working closely with the mission staff on all aspects of the PAAD amendment There are no remaining issues which will require substantive negotiation The mission and the GODR intend to obligate the loan amendment before the end of FY 83

The dollar loan will be repaid in 25 years with a 10 year graceperiod The interest rate will be two percent during the graceperiod and three percent thereafter The borrower will be the Government of the Dominican Republic The implementing agencywill be Technical Secretariat of the Presidency

Notification to the Congress An advice of program change was sent to Capital Hill on September 12 1983 Funds could be authorized after September 27 and obligated on September 30 1983

Recommendation That you sign the attached PAAD Facesheet authorizing an increase of $8 million for the Dominican Republic Private Enterprise Sector Development Program

Attachments

1 PAAD Facesheet and Abstract 2 Cable Santo Domingo 7440 3 PAAD for Private Enterprise Sector Program 517-0171

Clearances LACDRSESmith LACDPDBroome_ A _ GCLACRMeighan ---shyLACCARJHoltaway PPCPBMMuhammad ARAECPRBash A-DAALACIALevyU

LACDRROttovc92683 X29162 0153L

CLASSIFICATION 1 PAAD Number

AGENCY FOR INTERNATIONAL DEVELOPMENT A-mndment to PAM 517-K-046 2Country

PROGRAM ASSISTANCE Dminican Republic

3 Category APPROVAL DOCUMENT

Cash Transfer (PAAD) 4Date

Septefer 23 1983 3To 6 OYB Change Number

Acting AAVLAC Marshall D 8OYB lneue 7 From None

CR n -- - To be taken from LACDR Econanic Support Funds (ESF)

9 Approval Requeste for Co mitment of 10 Appropriation Budget Plan Code s 80000007 LESA83-35517-KL31 72-1131037

11 Type Funding 12 Ibcal Currency Arrangement 13 Estimated Delivery Period 14 Tranaction Eligibility Date MlLoan 5 Grant - Informal [ Formal None FY 1983 15 Commodities Financed

NA 16Permitted Source 17 Estimated Source

USonly US $8000000 Limited FW Industrialized Countries Free World Local Cash S8000000 Other

18 Sdnrlan D sroionis It amendment to increase funding for the Private Enterprise Sector Dev Program

(Project b517-o171 Loan 517-K-039) by $8000000 to $49000000 Additional funds are being requested to implement the following strategy

(1) AID to provide additional immediate BOP relief to the Dominican economy by the provision of a $8 million cash transfer to the Central Bank The foreign exchange will be made available from the loan subject to a convenant by the GODR that in the succeeding 12 months it will allocate at least an equivalent amount of foreign exchange to the privace sector for the importation of essential raw materials intermediate goods and capital goodsfrom the US for private sector industry and agriculture The Central Bank will document imports of eligible commodities by the private sector and provide the mission with a quarterly report of these transactions All necessary supporting documents will be maintained by the Central Bank for mission review

(2) The GODR to provide as counterpart funding the peso equivalent of $8 million to be held in special accounts In accordance with the mission development strategy elaborated in the FY 1985 CDSS this counterpart fund will be used to finance high priority private sector developent needs The GODR has requested that counterpart funds be utilized to provideassistance to two general areas (a) RD pesos three million to support private sector exportexpansion including the development of free zone facilities and (b) RD pesos five million in support of a productive infrastructure principally to accelerate execution of IDB IBRD and AID projects which are necessary for private sector investment

The dollar loan will be repaid in 25 years with a 10 year grace period Interest will be daid at th

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UNGLASSIFIED INCOMING I)(y)ilunoI 5 [(1le TELEGRAM

PAE 01 SANTO 607440 01 OF 07 1619241 - 1230 031431 AID629 ACTIONIAID-0O

------------------------------ ------------------------- -----ACTION OFFICE LACA-03 INFO AALA-0l LACO-02 LAP-03 LADIR-03 FVA-01 PPCE-0l PPEM-01

PPPI-02 GC-01 CCLA-03 GCFL-01 PPOC-01 FM-02 PVC-02 ES-Ol COM-02 0110-02 OPIC-I TRSY-05 RELO-01 MAST-01 DO-01 PRE-Cl S-01 052 AA 317

------------------------ r----------------------- IIIFO OCT-00 INR-I Et-08 ARA-0 IIRE-0O 069 W

-----------------070514 161928Z 38 0 161600Z SEP83 FM AIIEIBASSY ANTODOMliGO TOSECSTATEWAHDC IMMEDIATE 3633

UNCLAS SECTION 01 OF 07 SANTO DOOINGO 7440

AIDAC

EO 12356 lNA SUBJECT PROGRAI APPROVAL (PAAD)- AIIEIIOIIEIiT TOASSISTAIICE DOCUMENT PROJECT NO 517-0208

1 SUIIIIARY THIS CABLECOIIS11TUTES THE PAAO TO AIEND THE ONGOING PRIVATE EIITERPRISE SECTORDEVELOPMEIIT PROGRAM(PROJECT hUMBFR 517-0203 L AII IUIEIR 517-K-039) TA1ISAIIEfiDIIEIIT WILL ADDDOLS80 MILLION TO li ONOIHG ECONOIIIC SUPPORTFUND (ESF) LOAN11125101 REEU-TS AIDIl AUTHORIZATIOIi 10 011LIGATE

THIS AIIENDIIENT PRIOR 10 EPTEIBR 30 ENDSUIIMtiY

2 PECCIIMEIDAIIOll UAIrUC01 ICOYNPpUILIC 1T(OlIIEhlDS AUTHORIZATION OF A DOLS 11 IILLIO I ICRrSE TO IlE ONGOING PRIVATE ENTERPRISE SECTO UNVELOPOEIT PPCGIP1I TiIIS IIICREASE

-WILL RAISE TREECIST INGEF LOAI TO A T[IL OF DOLS 49 MILLIOll TilE DOLLARL I ILL i PFIP 11I II 25 YEARS WITH A 10-YEAR GRACEfEA 101 ThE IITEF[ST hILL PC 2 PERCENT DURING THE GRACE PERIOD AN1D3 PEIEIT TIIEIE FTER

r3 BORII1ER WILL THEGOVERNMENTTHECORfWOITE O OF THE OOMINICAII REPUBLIC 1ODR) TIE TECHICAL SECRETARIAT OF THE PRESIDEIICY (STPI WILL CL TIlE OFFICIAL GODRPROJECT REPRESENTATIVE

4 PROGRAMSUIIIARY A DURING RECENT YEARS THE EOMIINICAN lASECONOMY SUFFEREDSERIOUSLY FROl DEPPESSED INTERNIATIOIAL PRICES FORITS MAJOR PRODUCTS SIIORTAGE- EXCHAIIGEOF FOREIGN AND OISTPICTED IMPORTS REDUCED FCRCITY AND INVESTIIEIITREVEII)ET OF CREDIT GROWINGPUBLIC SECTOR AN1DA POLICY FRAIIEWORIKDEFICITS WHICH HAS EMPHASIZEFD IMPORT U11UTIOI P110DEPEIIDEiCE UPON EXPORTS

OF TRADITIOIIAL AGRICULAT1 L A111MIIIERAL CUOMHODITIES B IN RESPOISE TO THIS 3EVERE ECOIOMIC SITUATION THE

GOVERIIIIENT OF PRESIDEIT JORuE BLANICOWi41ASSUIIED OFFICE IN AUGUST 1902 IMIILOIAIELY fOFIIULUTED 50TIlSHORT-AN IiEDIUM-RERmI STRATEGIES AllMEDAT ECCUOIIIC F_OOVERY THESESTRATEGIES WERE CONSISTENT WITHRECOIIIElOAiICIu IRE EIITF TO TIE ODR BY THE WORLDBANKIN JUIE 19L2 CALLING FO A ARROWIIG OFTIIl CENTRAL GOVERNIiEIITS FISCAL A OrDEFICIT 1PURRIITHESAGGING DOMIIIICAN PRIVATE ECTOR ANDPROOT01T OF NOII-TRAOITIONAL EkPORTS TO IIIPROVE COItIITRN- OIl LCHIIGE POSITIONTilE FDOE ALTIIOUGH THEC00 BEG11PHASIII I IIPLEIIEIITATION1102 A AN TO ACHIEVE THESE 05JECTIVES T WILL TAKE TIME FOR THESE REMEDIAL

ACTIONS TO HAVE A SIGIIIFICAifT POSITIVE IMPACT C TIlE GODR1AS DEIIONSTRAIEITH41 IT IS DETERINED TO

CONFRONT ECOIII I CRIII III DDIIOII TO ITSTHECURREIIT ANNOUINCEMENTAiO I1PLElE 1110IO1 OF A SERIFS OF ECON0OMIC REFORMIS TiE GOORREAIED ArtEEIrLNI Il JAIIUARY 19G3 WITH THE IMFFORAll EXIIIODD FUN11D IEFF) TOTALFACILITY INGDOLS4510 MILLION OVER3 YEARS PEGININING III 19 3 IT WAS A0111T TIllS BACKDRfOP1THAITHEUCOlul TilE0001 EXECUTEDOIl SEPTEMBDER30 1982 A LOANAUREIIEIII 10 PROVIDE DOLS 410 MILLIONIll

SANTFO 07440 01 OF B7 161924Z 1230 131431 AID6296 IMMEOIARF 10P) ANDTOEASEfHEOALAIICE-OF-PAYMIiI SUIPPORT

STRAIII Of Ti IUST Ei lIA MiEAlPES TIlE 60DRIWS lIl IlTI l TO TAKE 0 DURING 1HEFIRST RAIl OF193 iHE GOII iASATISVIII

ALL IiF CONIlTIONS [OR THE LFF PitilY DUETO fill 001REFFORT Td COiPLY WIT il T I MF AGRI [bil Tile 001 rITOslIuOil IiMPROVED SUBSTANTIALLY DURING THiEJAtIUIRY-JUIrt 192 ERIOU TilEOVERALL BOPDLI ICIT IN 1933 4OW TOHE La1 19 IlILION ASIS [SII111ED COMI-TO-filEPAREDDISM1E1A it IN 1932TO LEVLL 1 317 Mlltl101 THIS IIPROVEMENT HOiEVER iS NOT liE TO All INCRItE IlI EXP0RT EARIIINGS BUTPRIMARILY DUE TO Till lILSIi1COUL 1G Of MORETlAN DOLS600 MILLIO IllIN SHOR4ITkll CI)fIIFRCIAL Ifll RfiEARGES THE COINIERCIlL TES( ILHLI LREEIEIiT IS ffO FE SI EDOil SEPTEIIEFR 15 1993 ILAIINWHILE GODRlOSPROPOSEDTill FORIMLLY TO THE OVLfflitENIT OF ft1114CETIHEREiIEGOTIi 110 OF ITS OFFICIAL DEBTTHR0OUGH PALiS IF C11PLL tFO BElORE111 CLU IIICHPllISll

YEAREiD THIS ACTIfiOWILL RLIFV TlE GOUTF ABOUT DOL 81 MILLION llII OFFtICIL CE T ERVICE IN 1g3 THEREOIITlOl Ill TilE OVERALL LOP OEFICIT lO1vER IS NOT All INDICATIOl OF IMPROVEIENT Ill THE FCOlOIut BUTRA4TIHER OFA 11A1 FESTAIIoN DEPRESSED ACTIVITY POP ASSISIAIICE ISECOIOMIC OtNTIIUE0 CLEARLY IND1ICATED BY TE FACTTHATIiE NET IITERiIATIO1AL RESERVES HAVE)ECLI11EO STEADILf TO I110U DO 355 MILLION AS OF MAPCH1983 IIIDICATIIG A 2EVERESIORTAGE Ol fOREIGII EXCHAIGE ANDLIMITED ESSEIiTIAL I1PPIS TO TIIE CCIITRY

E THE STRAEGY IROPOED hEqEIII IS FOR 1) TiE USG10 PROVI E ADDITIONAL I0iVCDIATF POP

RELIEF TO THE OOMItiIC4N ECON1OMYVT11PROVISION 8Ie OF A DOLS MILLION CASHT1NSFER TO THElOr EIGIl1 IlE CEINTRftBAi EXCHANGE IE FROMITHELO1lSBJECT TO AWILL MADEAVVILADLE

COVENAIT BY Tilt THESUCCEED ELVETIOIITHSITGODRI AT Ill ING WIILLALLOCATE AT LEASTP4 EQUIVALENIT AMOUNOFFOREIGIl EXCHANGE TOTHE PP IVATESECTO IT HE IIIPORTAT IOlFOR OF E55E11IAL RA MATERIALS IflTEtIIEDIATE GOODAND1CAPITALGOD0 FIOM THE US FORPRIVATE SECTORIIIDUSTRY iJID 1 III 11RE Tl11 CECIRA PANIK WILL DOCUMENT OFELIGIBLE LY lilE IRIVATE1PORTS COtItODITIES SECTORAN1DPROVIDE Tile Ill S0ON] WITHA OUARITERLY OF THESEREPORT TRANSACTION ALLNECESARY SUPPORTIIG DOCUIElTS VtILL LE MAINTAIIIED BY THECENITRAL FOR IIISIOIIP1AR1K REVIEW

2) THEGOORTO PROVIDI ASCOUIITERPART FUNIDIING THE PESOEQUIV-LENfO 001 C MILLION TOEE HELD IIISPECIAL ACCOUNTSIN ALCRuAICE WITHITHEIlISIO31 DEVELOPIEtiT STRATEGY

ELABORATED IN THE FY 1585 CDSS TillS COUIITERPART FUND WILL BE USED TO FINIAICE HIGH FRICRITY PRIVATE SECTORDEVELOPIEIIT NEEDS THE GODR HAS REOUETTEDTHAT CIITERPART FUOS BE UTILIZED TO PRIVDE ASSISTAHICE T0 TWOGENIERALAREAS () RD PESOS 3 MILLlOl TO SUPPORT SECTOR FPAIISIOIIPRIVATE EPORT INlCLUDIlIG THE DEVELOPMENT OF FREE ZOIE FACILITIES AND 1B)RD PESOS5 ILLION IN SUPPORT INFRASTRUCTUREOFA PRODUCTIVE PRINCIPALLY TO ACCELERATE EXECUTIOII OF IDB IBRD AND AID

PROJECTS WHICH ARE NECESSARY FOR PRIVATE SECTOR INVESTMENT

OF ECONOMIC5 DESCRIPTION COIIDITIOINS - UPDATE

UNCLASSIFIED

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PAGE 01 SANTO 07440 02 OF 07 IU1943Z 1301 031434 AID(308 ACTION AID-O

- - ACTION OFFICE LACA-03 INFO AALA-HI IACO-02 LADP-03 LATR03 FVA-HI PPCE-0 PPEIM-0I

bullPPPB-02 GC-O1 6CLA-03 GCFL-01 PPDC-I Fm-02 PVC-H2 ES-HI COM-02 OMO-02 OPIC-10 TRSY-05 RELO-I MAST-0I

0O-01 PRE-0I 051 A4 317

--INFO OCT-00 COPY-Ol 11111-I ED-C8 ARA-O0 AMAD-I1 INRE-O0

071 W -------------- 071116 16195OZ 6538

0 16160Z SEP 83 FMAMEMBASSY SANTO DMIIIGO

TO SECSTATE WASHDCIMIIEDIATE 3634

UNCLAS SECTION 02 OF 7 SANTO DOINGO 7440

AIDAC

DO1111CII APPEARSA DURING 19C3 TIlE ECONOMY TO HAVE DOWNSLIDE BEGAN W1IH

PETROLEUM PRICE 1978 DISASIERS INI1979 AND

HALTED ITS WIICH HE IIEAR-DOUBLING OF IIN TWOIIRfIlCANiE

THE PRESCIPITOUS DROP OF [1RD SUGAR PRIICES III191 DURFINGTHE PRICES HAVE RECOVEFED AS

IIAVEPRICES OF GOLDSILVER AND FERROIII(ELL A SUBTAIITIAL INCREASE INiTOURISM CARhlIGS) IS FORECAST FOR 19-S3 REALGOP GROWTH IS ESTI1ATEI Il THE RANGE OF 2-3 FEFCEIT VRICl

FIRST HALF OF 193 SUGAR SLIGIITLY

FOR19S3

COMPAILS FAVORADLY AGfh T ZERO GROCVTHIll 192 TIlE PRELIINIARY F TI IATES CTE PROnUCIIVE SECTORSDI HOEVER FTlE -- AGRI CULTURE -- HIAVEANDIllr0u1IRY NOT SIOUANYAFFPRECIAILE IMPROVEMENTS DURING TIE FIRST HALFOF 19IS Ii All OFENECOINOMY SUCHAS TllIS ONUEIT IS UINRAI1STIC TO ELrECT TEAL NCO HIIIl PRODUCTIONl 41TIOUI IN IIIPORTS OFRAWTOOCCUR INCREASES MATERIALS INT EREDIATE INSPITS 1ID E VARIDU IMPORTCAPITAL STATISTICS SHOWA REDUCED 1933 INPORT LEVEL IN CIRFENIT PRICES FROCMTHE DEPRESSED 13Z2 LEVL ASLOlG A I I1ORTS ARE RECESSED AT THE1982 LEVEL110rEAL ECOIONI C GRnOTIIIS LIKELY TO TAHE PLACE IN TILEDOMINICAI ECONI1Y

B THESINGLE lOST IVOrTIlT EVENT SO FAR Ili1983 HAS BEEN THE IMF AGFEEMEIIT FOR AliEXTEIIDED FUIO FACILITY SIGNED IN JAVIUARY UN1DER NT THE60DR TOTHE A-RNIIE IS FETIIITTED PURCHASE A0OUT DOLS 450 lILLION OVER 1983-19535 APPROXIMATELY DOLS 150 IILLIOINEACH YEAR WITH AUATTERLY IMFCONSULTATIOCHS THE IMF ACREEII1III CONTA TIHE CRITERIAINS USUALPERFORIIANCE SPECIFIED ONEYEARAT A TIIIE RELATED TO EXPAISIOI OF NET DOMESTIC CREDIT OF TIlE CEtITRAL DI5l1 AID RESERVEBAKI NIET DOMESTIC ASSETSOF THECENTRAL BANK NET REDUCTION IIIEXTERIIAL PAYMENlTSARREARSCENTRPAL IITERIIATI IAL RESERVESBAIK NET AS WELL AS LIMITS ON THE COIITRACTIIINGOF NEW EXTERNIAL LOANS BY THE PUBLIC SECTOR A DOLS100 IILLION1 REDUCTIOINII CENTRALBANK EXTERINAL ARREARAGES A DOLS 35 MILLION TRAIISFER OFPAYMEIIT AID OFFICIAL IMPORTS 1533TO THE PARALLEL MARKETTHEIi EXCHANGE IhF ARRANLEMEIiT DID NOTREQUIRE EVALUATIOI OF THECFFICIAL EXCHANGE IDUTILIZATION OFRATE BUT ENCOURAGED LEGAZATIOI THE PARALLEL EXCHANGE MARKET IT lAS HYPOTIFSIZED THAI A POLICY OF DROADENIIIIG PARALLEL FOREI1G1THE SCOPEOF TlE EXCHANGE IARHET WOULD FACILITATE UIiFICATIOrI OF THE EXCHAIIGE ATMARKET SOME FUTURE TIME AT A REALISTIC RATE

C WITH THE IMF AGREEIIEIIT III HANDTHEJORGEBLAICO ADMIIISTRATIOl LAUNCIED ITS IIEGOTIATIONS WIITHCOIIIiERC[AL BANKS TO RESCIIEDULE ARREARAGEPAYIILIITS ALTIHOUGIITHE NEGOTIATIONS WEREDELAYED CONSIDERABLY DUE TODIFFEREIICFS AMOIITHECREDITOR BAIKS OVERTERMSTIE ANDTIlE GODR REACHED INANS AGREEMEIIT LATEAUGUSTTO RESCIIEDULE CF MOREREPAYIENT TIIANDOLS 600 MILLIOl IN 19283 COIHIERCIAL TOFIVE AARSEAiNAC-FS [fRS WITRH ONEYEARGRACETIlE tIFAGREE[iENT AII0 THECOMMERCIAL RESClHEIIL I1NGAID PROSPLCT IVE PARI INGWILLIS LUH RE CtE1 1DU RELIEVE PRESSURE OIlTHE HALANCE OF PAYMEINTS SIGNIFICANTLY BUT

TEAIMPOARILY D THE SLOWECONOIC GROWTH THEPAST FEWRATEDURING UNCLASSIFIED

SANTO 07440 02 OF 07 IGI94JZ 1331 031434 All YEARS HAS I GRRAVAIED TillE OIMElT SIfUATIONALREADY HIGH UIlEMPI

SOME REPORTS CL1 1 THEIHIEiLIUYIFIIR 1 1 TO 1 cE En J PERCENT OF TilE AVAILABLE OIIHORIICEHOWEVERTHECUISIfAVAIIVE MOREIARY POLICY ANDPRICE CIiUTIOL MlAStR(S PUIISUED BY IHE 6ORHAVE LIItlTED THECOISUMErPRICE IfU1LATIOl AflOIJIIN 1933 10 A 7 PERCENTAIJUAL RATEANDTHE1Ill TEPfECI ATIOll OF TillPSO TO IUNDER PFRCENIT Till OF THE10 PERIiPS MOT R[IMARKtILE OUICOMIE

JORGEOLAN OS D111111S MUSTle ITS TOIRATION ALLOUT[FERT IIICREASE TIlE Ef IClEIICY OF TIlE FUBL IC SECTOR EN1TERPRIE OPERATIOINS TIll PRESIDENT SCRUTINIZEID TlHE INAIICIAL OERATION OF CEA COE IESFRE hill THE CORDE IERPRISEE ANDRPORTED THATTIHEI DEFICITS HADEEEN REDUCED LElWEIr 44 TO 74 PERCENT DURING TilEJANUARY-JUIIE 1983 PERIOD COMPARLD TO THOSE DURING THE SAMEPERIOD IN 1932 THE DEFICIT OF THE CEIITRAL C3VERNIMENT HAS ALSO BEEN REPORTED TO DECI IIE FROM RO PFSOF 14 MILLION Ill THE FIRST IHALFOF 192 10 FT PESO1S35 MILLIOll TUrdIlG TIlESAE

PERIOD III 1933 -- A REOUCTIDIOOF 39 PERCENTTllS REI41RH8LE OUTCOME IS PRIIARILY ObE TO THE S1EPPED UP IFFOR IIIFAX COLLECTION INITIATED UY TlHEJORGE BLANCO ADIIIlJISTRATI31

E IIFSUM THE COIII1IATION OF TIlE I OF AGEEIIENT TE RESCIIEDJLIhG OFTHE COMMERCIAL DET AD rEAnD OFFICIAl DETERMINED EFFORT BY THE GOR TO I1PROVEPUBLIC SECTOI EFFICIENCY SEELMTO hAVESTALLED OR EVEIIIIAlTEDTHE EC30IIIC

SLIDE WHICHHA IhTPLPRFD ECICI0Y FEWTHE DOINICAII FORTH PAST YEARSHOWEVER REAl ECOS)IIIC NOT YET INCREASEDTIlE SECIOR lIAr) PRODUCTION AID Ill PERHAPS THElIORE RELEVANTEXPORT RESPONSE QUESTlON TO ASK IS OUOTELWlYIULD PRODUCTIOl AND IIIVSTMENT INCREASE UNOUOTEFORTHE IMFANRA EIIENT IS E)SEUITIALY A STABILIZATION PROGRAM ThE IlIF CONDITIONS WHIICHLIIT ET DOREST IET DOVESTIC ASSETS CF TilE CENTRAI 3ANK NETIC CREDIT EXTERIlAL PAY II T AAREARS lET IITERIIATIOIIAL FESERVES OF THE CENTRALELAI AID PLACECEILI lIES00 FOREIGN EVOHOING 3Y TIlE PUBLIC SECTORCOISTRIII TIlE GO R FROMADOPTIIIG AN EAIISIOIIARY ECONOMIC POLIC FOR THE T WITIIOUTCJRATION OF THE AGRIEKElE THEIIITIATION OF EXPAIISIDIARY POLICY IEASUIES IT IS IJIILIKElY THATA IEW WAVEOF I E TIMEIIT 3ILLANDPRODUCTION BE FORT COII ADDITIO1 DCRESCrEDJLI1IG11GIII THE CC1MIE1TCIAL PROVIDES ONLY A OliE YEAR GRACE PERIOD (1984) THUS T-IE GODR

MUSTFIN1DWAYSOF IICREASIN1G ITS EARIIINGS IIITHE SHORTTO MEDIUIIRUN TOIIEETTHEIJEWDEBTREPAYMEIITS AND EXPAIIDTHE ECONOMY

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PAGE 91 SANTO 07440 03 OF 07 162017Z 1558 031435 AID6338 SANTO 07440 0 OF 07 162111I7 1552 031435 AID6338 ACTION AID-00 ESTIIATE[) AT MINIUSDO GMILL IO COliPhRE)TO ]II EST0iMlEO NET

--------------------------- - OUTFLOW ION IA1 lll- OF DOLS1211ll1 IITIIG TlE 1W5i ACTION OFFICE LACA-03 AGRIEIIEII AND lHE COIll (IA1 ILII RELS lilt TO IEAVrH1AII[DLh S EI INFO AALA-I VACO-0 LADP-03 L HRn 03 FVA-0I PPCE-Ol PPEM-I POSITIVE IOPACr OR CREDll AVIlLIBILlITY IINAOI11Oil INEIIE

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INIFOOCT-00 COPY-Cl 111R-IC EB-Ca ARA-00 IIIRE-0O070 W 337 MILLION DEFICIT EIIMATED FR 1912 --------------- 072065 162DSOZ 6332 B WE IILIST IIASTFII TO 1 A WOFRDO CAUTION ALTIIOUGH

0 16160OZ SEP 83 TIlE CENTRAL BANKrFROJECTS AllIiiROVii ECP fPICIURE IlOR1983 THE FMIAMEfiBASY SANTO DOMIJGO FIGURES INIlCATETHATTHERE HASHOTIIEEl REALPROGRESS III TO SECSTAIL WAISIIDC 3635 EXTERNAL TRADEONTT ACCOUIITS (1)THI OVERALL COP IS STILLIMMiEDIATE

NEGATIVE THAT MZ2i0 EC(0III( MUST REDUCEITS TIlE C0011IIICAN UNCLAS SECT 11 03 OF 07 SANTODOMINGO7440 IIITERNATIOINAL PEZERVfTV-hICHAREALRLADYAT IlNUSDOL 855

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OPTIONS AFPEAR OPEINTOTIlEGODOR MAKERS IIA OIE YEAR (1E1I) TOPOLICY ECONOMY TO FEVITAL IZE ITS EXPORT SECTOR 1) ItICPEASE IION-IRADIT01AL EXPORTSOF GOODS AND EARIIADDITIONAL F(EIG FYCHAGE SUFT ICJEl TO COVER THE

SERVICES BY AT LEAST OLS ISO MILL101 A YEAR OVER THE 1985-89 ADDITIOIAL SERVICES OF AlOUTDOLS 15 iILLIOl PERAIVIUM THE UPCOMING REPAYMEIIT IT IN 19a5 THE Is T0 C0OW

IS UNREALISTIC TO EXPECTiIO-TRADITIONo L EXPORTS TO INCPEASE AT ANYAPPRECIABLE ICREASE Ill EXPORTEARIIIOiAS PROSPECTS FORA THIS RATE IT WILL TAIE AT LEAST FOUR TOrIVE (EARS TOCIIAICE RAPID INCREASE It E0I0T IN 195ARE AT LEST UYCFRTAIII THE STRUCTUREOF THE ECONOMY FFTT ITS ITORT SUBSTITUTIOII TO FURTHERIORE TEF LEVEL CF IMPORTS IS DEPRESSED AT DOLS 1250

PERIOD TO COVER ARREPRAGE HOWEVER BEGINNING SIICE COPACCOJT FAILS

IIIPORT N CURV SUBSTITU1O I AS lOTINET N0 PqASIC INICREASE DEPPESSED I Mi CRT L A)1 SOITE

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OF DOMINICAI EYPOFT COIOlDITIES TO I C TIlE COUNTRYS EOP ACTIVITIES 10 IrFORTS AiNDREVEIUE POSITCI TIE VOLO PRICL OF SUGAR COFFEE C THELC DEFICITS OF 1973-192 WEFESUSIANTIALLY COCOATOLACCOLOIE SILVER IIICEL ETC II THE THE OF EXTERrh iRFEARSMAYRISE FIIINCED GACUrJLATIOil FOOPEINTS AIID FUTURETIHEREB( FOTEI I LYAClIGF FOR THE REDUCTIOtl FESERVESLA lOGTiE FFESSJIPE TIlE Il TIlE IET INUTERNATIONAL OF THE6001lING TIME EII OF COAIrl SYSTEM TlE ASSETS OF THE ENITIREDE TO 1H1 FROJLCTED REDUCOTION COPS TiS IIIREAATITIL AND LIlTILITIES YEARIII THE US I1 IIl USTITU1ES IIILL BANK IIGSYSTEM AOF IARCIl1983 A IiECATIVE INTEFIATIOliALHT Hi F EII Th0T 5U2R 110LONGEREE COIIFET AND1 lAYGO DOr RESERVE OF DOLt c553 IlLIO AS COMiPREDTI SUGAR PRICES ArCTUALLY TO A POSITIVE SUBSIANTIALLY UEFORTUNATELY WIVi TillSOPTION THERE IS IIITERIIATIONAL RESERL OF VOLS 194 lILLIOl AT TIlE END OF 1101IllG THATTilE GCDR Cfil ADDII TIlE 1977 DRAMiTIC RESERVESDO Il ilOEVENIF TERMS TilIS DETEflIORATIOII IIIIITERIATIOIAL OF TRADE IMPROVEFOR NOW IT IS LIKLFY TO DE ONLY A TRAISIEIIT MUSTBE REVEPSEON IF TIlE EXTERIIAL TRAOE SECTORIS TO6E PIlENOMENOlI RESTORED 110RAL Il ADDITIONl IEDIUMI-AIIDTO A lITRE SITUAIOl

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PAGE 01 SANTO 07440 04 OF O1 ACTIOII AID-DO

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ACTION OFFICE LACA-03

INFO IALA-0I LACO-02 LADIP-D3 IAfR-01

PPPB-02 GC-01 ampCLA-03 GCFI-01 IS-01 COM-02 OB-2 OPICO TRSY-O iELO-O MAST-0l

00-01 PRE-01 051 A4 317 ------------------------------------------------------------------

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720 MILLIOl A 75 PERCEIT REDUCTION FRO THE 192 LEVEL THE PRESIDENT HIISEILF SCFUTINIZED COVER1IIEIT E)PEIJIIIURFS TO REDUCE UNIIECESSARY EPEtISES Ill ADUIIIO TAX OHGANIIZATI S IVERE INSTRUCTED TO IMPROVE ENFORCEMEINT OF TAX COLLECTION A LARGE N1UMB1ER AND A RE PROHICIlEO AS A

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9 STATUSOF TIlE ONGOINGPROGRAII A TIlEPRIVATE EIITIRPRISE SECTOR DEVELOPMEIITPROGRAMIS

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DAEC DOMINICAN REPUBLIC PAAD

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29lthsect 6_6

ACTION MEMORANDUM FOR THE ADMINISTRATOR 27 1982 THRU ES

THRU AAPPC John Bolton

FROM AALAC Otto J Reicho

SUBJECT Program Assistance Approval Document (PAAD)- Dominican Republic

ampr e To authorize a $410 million loan from the Economic Support Fund (ESF) Supplemental to the Government of the Dominican Republic (GODR)

Apj In recent years the Dominican economy has been adversely affected by three major events which have precipitated the current severe foreign exchange and fiscal crisis They are (1) Hurricane David in late 1979 that caused extensive damage to the countrys infrastructure (2) the 1979 doubling of world oil prices that raised the import bill of petroleum products from 29 percent of total export earnings in 1978 to 42 percent in 1981 and (3) the world economic recession of 1981-1982 that has caused serious deterioration in the Dominican economy primarily due to depressed international prices for its major exports

In response to a desperate economic situation the newly-elected government of President Jorge Blanco who assumed office in August 1982 immediately formulated both short- and long-term strategies aimed at economic recovery These strategies are consistent with recommendations presented to the GODR bythe World Bank in June 1982 calling for a narrowing of the central governments fiscal deficit a spurring of the sagging Dominican private sector and promotion of non-traditional exports to improve the countrys foreign exchange position Nevertheless it will take time for these remedial actions to have a significant positive impact and in the short run there is concern that current difficulties could steadily impose worsening economic hardships on the Dominican people and cause severe structural damages to the economy

The new administration will not only have to face the countrys economic difficulties and undertake a series of difficult and far-reaching measures but will also have to convince the Dominicans that its economic problems are being addressed effectively that short-term austerity measures will pay off in the longer term and that sacrifices will be shared equitably within the society This is an extremely difficult task for the new government and the reaction of the country is unknown Nevertheless the GODR has demonstrated that it is determined to confront the current economic crisis In addition to its announcement and implementation of a series of economic reforms the GODR is in the process of negotiating an IMF agreement It is anticipated that this agreement will be reached by the end of the calendar year It is against this backdrop that the US offers assistance to ease the strain of the austerity measures the GODR is committed to take and to provide immediate balance-of-payments support

McjIPipan The attached PAAD proposes to provide a $410 million loan from ESF to the GODR through a cash transfer to the Dominican Central Bank The cash transfer approach is considered the most appropriate because of the

0(382

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immediate need for disbursement of dollars to provide balance-of-payments support and specifically to respond to demands for foreign exchange by the private sector Foreign exchange will be made available from the loan subjectto a covenant that in the succeeding twelve months the GODR will allocate at least an equivalent amount of foreign exchange to the private sector for the importation of raw materials and intermediate and capital goods from the United States

Within approximately a month of disbursement of the loan the local currencygenerated from the program will be deposited in a special account in the Central Bank for uses agreed to by the GODR and the US under the assistance program The GODR has identified three areas of financing which respond to high priority private sector development needs Although specific allocations of local currency generations will be subject to further negotiations between the GODR and the Mission and subsequent presentation to AIDW for approval GODR plans and priorities include the following (1) capitalizationof a credit facility within the Central Bank to increase the volume of credit to the private sector for expansion of agribusinesses and export activities ($250 million) (2) capitalization of a productive infrastructure fund to accelerate on-going GODR investments financed by AID the IDB and the IBRD where lack of local currency counterpart has resulted in work stoppage of projects deemed critical to expanded private sector productivity ($100million) and (3) private sector training and technical assistance and financial support for private voluntary organizations ($60 million)

The LAC Bureaus Development Assistance Executive Committee (DAEC) reviewed the PAAD and recommended approval on September 24 1982 subject to certain revisions Principal revisions are (1) the inclusion of a covenant and side letter indicating that the CBI funds including local currency generatedshould not be used in a manner which will cause serious injury to the production marketing or pricing of US agricultural commodities or products (2) the inclusion of a requirement that a least 80 percent of the credit funds be directed at small and medium export and agribusinessactivities (3) institutionalization of measures within the GODR to ensure that special emphasis be placed upon lending to cooperatives includingsetting aside a portion of funds for feasibility studies which will identifycooperative projects for financing under this program (4) an increase in assistance for private voluntary organizations and (5) the inclusion of a general covenant that mutual agreement between the GODR and AID is to be reached on the programming of all local currency generated under the cash transfer

gjsijfjcat o tp_Cogjs Since funds were appropriated by the US Congressfor the Dominican Republic in the Caribbean Basin Initiative FY 1982 Supplemental no further notification of Congress is required

Rgp4qp LAtipp That you sign the attached PAAD facesheet authorizing $410 million for the Dominican Republic

Attachment Dominican Republic PAAD

LACDRI-kerjw92782X29484 Clearances

PPC PDPR JEr ik n-

GCCLvanOrman -

_ CLASSIFICATION AID 1120-1 I PAAD NO

(8-6 ) DEPARTMENT OF STATE 517-K-039 AGENCY FOR 2 COUNTRY

INTERNATIONAL DEVELOPMENT Dominican Republic 3 CATEGORY

PAAD PROGRAM ASSISTANCE APPROVAL DOCUMENT Cash Transfer

4 DATE

September 17 1982

5 TO 0 OYB CHANGE NO

M Peter McPherson Administrator B OYB INCREASE

FROM

TO BE TAKEN FROMItA Otto J Reich AALAC Economic Support Funds (ESF)

9 APPROVAL REQUESTED FOR COMMITMENT OF 10 APPROPRIATION - ALLOTMENT

$ 41000000 1 11 T YPE F UNDIN G ILOCAL CURRENCY ARRANGEMENT 13 ESTIMATED DELIVERY PERIOD 14 TRANSACTION ELIGIBILITY

MFOMALONCDATE[XLAN _ RNT ~rORAU LOAN E-JRAN EINFORMAL Ex]FOflMAL [JNONE FY 83 Date of approval

15 COMMOOITIES FIJANCED

NA

16 PERAITTED SOURCE 17 ESTIMATED SOURCE

US oly US $41000000 Limited FW Irdustriolized Countries Free World Local Cash $41000000 Other

1P SUMMARY DESCRIPTION

The program proposes to a) provide immediate balance-of-payment relief to the Dominican economy by provision of a $41 million cash transfer to the Central Bank b) utilize these funds to pay for imported inputs of necessar- S goods and services

for the private sector c) provide as counterpart funding the peso equivalent of $41 million to be held in special accounts and aimed with US concurrence at high priority private sector development needs in three areas (i) $25 million for financing private sector export promotion and agribusiness projects (ii) $6 million for training programs and institutional strengthening of organizations involved in private sector development and (iii) $10 million to assist GODR investment in productive infrastructure necessary for expansion of private sector activities

Thu GODR will agree to allocate foreign exchange to the private sector for the importatior of spare parts capital goods and industrial and agricultural inputs from the US in an amount at least equivalent to the loan over a one-year period Covenants will be included in the loan agreement which will require inter alia (1) use of AID assistance in a manner which will not cause injury or the threat thereof to the production marketing or pricing of US agricultural commodities or products and (2) the implementation of thE provisions of Section 203(a) of the draft authorization markup for the FY 1982 suppleshymental which prescribes requirements relating to the use of funds Details regarding Zbe IQ CEARANCES aTE 20 ACTION (see continuation on next shee-

L DDISAPPROVED- -E~Z ~APPROVED RE ~ ~92982

AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

~ A~1A~A~ AUHRIE G N DATESINTUR EGCCLvanorman Counselor to the Agency ARAECP C len UI ____ _

LAC DI 2- TITLE

CLASSIFICATION I

18-1 Continuation of Summary Description

imaplementation of these covenants will be spelled out in a separate side letter

The dollar loan will be repaid in 25 years with a 10-year grace period The interest will be 2 during the grace period and 3 thereafter

2

be obligated until the IMF and GODR have reached agreement on -he targets for the second year of their Ektended Fund Facility (EFF) Agreement Evidence that this agreement has been reached should be submitted by the GODR with the endorsement of the IMF Upon approval by AIDW the Mission will then be authorized to obligate these funds

The loan is for a 25-year term with a 10-year grace period Interest is set at 2 percent during the grace period and 3 percent thereafter The implementing agency is the Technical Secretariat of the Presidency

1 673c

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cover their current costs and gradually achieve an adequate return on investment lower generation costs of the electric company by substitution of coal for oil raise nominal interest rates for financial institutions subject to regulation maintain wage restraint and improve the operations and reduce the deficit of the Price Stabilization Institute

DISCUSSION The GODR has met and in some areas substantially exceeded the targets it set with the IMF under its present arrangement Inflation currently running around 25 per year appears to be falling and the value of the Dominican Peso has been stable at around three to the dollar for the last eight months (The official rate which was eliminated in January 1985 was 11) However the cost of progress has been high Production declined during the first half of 1985 and GDP growth is expected to be zero or negative in real terms for the full year Progress achieved to date is jeopardized by a projected shortfall in net foreign assets which threatens to force the GODR out of compliance with end of year criteria under the stand-by agreement and jeopardize a $280 million commercial bank rescheduling

In its PAAD the Mission proposed a $50 million grant to provide immediate balance of payments support to the Dominican Republic and to make a major contribution to cutting the current account deficit and help leverage a restructuring toward a market based economy Immediate disbursement of $40 million is needed to help insure that the GODR will meet the end of year net foreign assets test under the IMF stand-by agreement The remaining $10 million will be needed to help the Dominican Republic maintain foreign exchange availability during 1986 when the Dominican Republic will be feeling the effects of expected $25 million decrease in the US sugar quota and to encourage a reduction of recently imposed export taxes

In addition to satisfying standard CPs to disbursement (eg the submission of legal opinion and the desionation of authorized representatives) and basic covenants (joint USAIDGODR programming of ESF counterpart and the importation of the equivalent amount of the grant for spare parts capital goods and industrial and agricultural inputs from the United States) the Mission proposes that the GODR agree to the following covenants


2 Reduce significantly the 36 percent exchange tax surcharge on traditional exports achieved by the end of the first quarter 1986

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IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

-4shy



Clearances



-4-


RECOMMENDATION



Approved __

Disapproved

Date

PPCUPampIKauffman


Clearances







S CATEGORY


4 DATE



1 FRM
















---VIson - TTrL E

ics r rION7


A Major Covenants














AIDAC

FOR LAOOR










C MAJOR COVENANTS




AID71

UNCLASS IFIED 6

_ _





4 DATE



7 FROM



L 50000000 ________















I Lpp W~h eeler _ _ _ _ _ _ _ _ _ _ _ _ _ _


stensen TITLE

-1-




C Major covenants


























UNCLASS IFIED






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

-4-


RECOMMENDATION



Approved __

Disapproved

Date

PPCUPampIKauffman


Clearances







S CATEGORY


4 DATE



1 FRM
















---VIson - TTrL E

ics r rION7


A Major Covenants














AIDAC

FOR LAOOR










C MAJOR COVENANTS




AID71

UNCLASS IFIED 6

_ _





4 DATE



7 FROM



L 50000000 ________















I Lpp W~h eeler _ _ _ _ _ _ _ _ _ _ _ _ _ _


stensen TITLE

-1-




C Major covenants


























UNCLASS IFIED






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy




S CATEGORY


4 DATE



1 FRM
















---VIson - TTrL E

ics r rION7


A Major Covenants














AIDAC

FOR LAOOR










C MAJOR COVENANTS




AID71

UNCLASS IFIED 6

_ _





4 DATE



7 FROM



L 50000000 ________















I Lpp W~h eeler _ _ _ _ _ _ _ _ _ _ _ _ _ _


stensen TITLE

-1-




C Major covenants


























UNCLASS IFIED






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy


A Major Covenants














AIDAC

FOR LAOOR










C MAJOR COVENANTS




AID71

UNCLASS IFIED 6

_ _





4 DATE



7 FROM



L 50000000 ________















I Lpp W~h eeler _ _ _ _ _ _ _ _ _ _ _ _ _ _


stensen TITLE

-1-




C Major covenants


























UNCLASS IFIED






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy








AIDAC

FOR LAOOR










C MAJOR COVENANTS




AID71

UNCLASS IFIED 6

_ _





4 DATE



7 FROM



L 50000000 ________















I Lpp W~h eeler _ _ _ _ _ _ _ _ _ _ _ _ _ _


stensen TITLE

-1-




C Major covenants


























UNCLASS IFIED






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

_ _





4 DATE



7 FROM



L 50000000 ________















I Lpp W~h eeler _ _ _ _ _ _ _ _ _ _ _ _ _ _


stensen TITLE

-1-




C Major covenants


























UNCLASS IFIED






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

-1-




C Major covenants


























UNCLASS IFIED






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy






















UNCLASS IFIED






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy






315061 222112Z 60



AIDAC

PASS TO ARACAR

EO 12356 NA




I ESF OBJECTIVES











UNCLASSIFIED





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy





















UNCLASS IFIED I q



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy



ACTION AID-90






AIDAC

PASS TO ARACAR

EO 12356 NA










SANTO 13207 04 OF 12 222949Z 6621 51ID






UNCLASSIFIED q








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy








AIDAC

PASS TO ARAICAR

EO 12356 NA

















UNCLASSIFIED






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy






























ISIS



















UNCLASS IFlED



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy



ACTION AID-I

------------ ------- ------------------ --





31166 222116Z 60

P 222014Z NOV 1S



AIDAC

PASS TO ARACAR

12356 NNA














COVENANTS





ELECTRICITY RATES



RESERVE SANK










SANTO 13211 I Or 12 223491 5]6 361 l





LANDS




1986

- CPS





TARGET ACHIEVEMENT





UNCLASSIFIED




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy




o deg






















1 COVENANTI







IN is

2 COVENANT II












UNCLASSIFIED (



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy



















(Al THE GODRWILL



- A CASH TRANSFER

1 USES





UNCLASS IFIED

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

32
























TURN ADVISE USAID






FOR AID APPROVAL









AMOUNT (21



I AG POLICY I


UNCLASSIFIED -



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy



































UNCLASSIFIED






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy






































NEACCOjIIT

UNCLASS IFI ED 96

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

SEPr 29 W









RECORD cOPY

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

-2shy




-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

-3-






Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

Attachments






















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy



















ate-Date r r d 3



(

V(t1 -3

I__--__ P

1-

W1 APPROVED


[ DISAPPROVED

_ _ _ _ Daet 21 p)

v 1 _











AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy








AIDAC























UNCLASSIFIED





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy





0O-01 PRE-0I 051 A4 317


071 W -------------- 071116 16195OZ 6538




AIDAC







FOR19S3












-)

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

























UNCLASS IFIED



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy



----------------------- -




00-01 PRE-01 051 A4 317 ------------------------------------------------------------------


0 161600Z SEP 83



AIDAC


















































1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

























1





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy





FUNDS













1S VAZIL IIS







STILL APPLY















u IC It


iS A PRIORITIt

iNVOLVE 11t FOLLII





11Pf



o LtTO pilGJIDE










-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy



-7IE ERVICL -3252 -151 -1270










UNIT COST

AID -FIIIIIEOIC

1 4 AICE-CF-PAYMf1


GOOR-F INANCED














1981 1982 (PROJECTED) 1913



122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

122083 1000 am


LL o

k t

29lthsect 6_6










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy










0(382

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy

-2shy








PPC PDPR JEr ik n-

GCCLvanOrman -





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy





4 DATE

September 17 1982



FROM






NA








AA-rPC _ _ _ _ _ _ _ _ _ _ ~ 7 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _


LAC DI 2- TITLE

CLASSIFICATION I




2



1 673c



L~AAU1

A- CV i shy




2



1 673c



L~AAU1

A- CV i shy

1 673c



L~AAU1

A- CV i shy

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