Document ofThe World Bank

FOR OFFICIAL USE ONLY

Report No: 20502

IMPLEMENTATION COMPLETION REPORT(34830)

ON A

LOAN

IN THE AMOUNT OF US$42.5 MILLION

TO THE

FEDERAL REPUBLIC OF NIGERIA

FOR A NATIONAL AGRICULTURAL TECHNOLOGY SUPPORT PROJECT

June 29, 2000

Rural Development 2Africa Regional Office

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

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

CURRENCY EQUIVALENTS

(Exchange Rate Effective)

Currency Unit = Naira (N)N 100.0 = US$ 1.0US$ 1.0 = N 100.0

FISCAL YEAR

January 1 - December 31

ABBREVIATIONS AND ACRONYMS

ADP - Agricultural Development ProjectADPEC - ADP Executive CommitteeAPMEU - Agricultural Projects Monitoring and Evaluation UnitARMTI - Agricultural and Rural Management Training InstituteATSF - Agricultural Technology Support FacilityCFA - Cooperative Financing AgencyCSA - Centralized Special AccountERR - Economic Rate of ReturnFACU - Federal Agricultural Coordinating UnitFADPEC - Federal Agricultural Development Project Executive CommitteeFDARD - Federal Department of Agriculture and Rural DevelopmentFGN - Federal Government of NigeriaICR - Implementation Completion ReportLGC - Local Government CouncilMANR - Ministiy of Agriculture and Natural ResourcesMEMP - Micro-watershed and Enviromnental Management ProjectMTR - Mid-Term ReviewMTRM - Monthly Technology Review MeetingNARP - National Agricultural Research ProjectNATSP - National Agricultural Technology Support ProjectNFDP - National Fadama Development ProjectNGO - Non-Governmental OrganizationOED - Operations Evaluation DepartmentOFAR - On-Farm Adaptive ResearchPCU - Projects Coordinating UnitQAG - Quality Assurance GroupQTRM - Quarterly Technology Review MeetingRAIDS - Rural HIV/AIDSSOE - Statement of ExpendituresT & V - Training and VisitUAES - Unified Agricultural Extension ServicesWIA - Women in Agriculture

Vice President: Callisto MadavoCountry Director: Yaw AnsuSector Manager: Joseph Baah-Dwomoh

Task Team Leader: Samuel Eremie

FOR OFFICLAL USE ONLY

IMPLEMENTATION COMPLETION REPORT

FEDERAL REPUBLIC OF NIGERIA

NATIONAL AGRICULTURAL TECHNOLOGY SUPPORT PROJECT

CONTENTS

Page No.1. Project Data 42. Principal Performance Ratings 53. Assessment of Development Objective and Design, and of Quality at Entry 64. Achievement of Objective and Outputs 85. Major Factors Affecting Implementation and Outcome I I6. Sustainability 137. Bank and Borrower Performance 158. Lessons Learned 179. Partner Comments 1810. Additional Information 19Annex 1. Key Performance Indicators/Log Frame Matrix 20Annex 2. Project Costs and Financing 2 1Annex 3. Economic Costs and Benefits 23Annex 4. Bank Inputs 25Annex 5. Ratings for Achievement of Objectives/Outputs of Components 26Annex 6. Ratings of Bank and Borrower Performance 27Annex 7. List of Supporting Documents 28

This document has a restricted distribution and may be used by recipients only in theperformance of their official duties. Its contents may not be otherwise disclosed withoutWorld Bank authorization.

Project ID: P002140 Project Name: AGRIC TECHTeam Leader: Samuelwariboko Eremie TL Unit: AFMNGICR Type: Core ICR Report Date: June 29, 2000

1. Project Data

Name: AGRIC TECH L/C/TFNumber: 34830Country/Department. NIGERIA Region: Affica Regional Office

Sector/subsector: AA - Agriculture Adjustment; AE - AgriculturalExtension

KEY DATESOriginal Revised/Actual

PCD: 06/04/90 Effective: 08/15/92 06/08/93Appraisal: 03/03/91 MTR: 11/15/94 03/20/97Approval: 06/09/92 Closing: 12/31/99 12/31/99

Borrower/lmplementing Agency: Federal Republic of Nigeria/Federal Ministry of Agriculture - State Ministry ofAgriculture

Other Partners:

STAFF Current At AppraisalVice President: Callisto Madavo Kim JaycoxCountry Manager: Yaw Ansu Edwin LimSector Manager: Joseph Baah-Dwomoh Anand SethTeam Leader at ICR: Samuel Wariboko Eremie Surjit SinghICR Primary Author: Samuel Wanboko Eremie

2. Principal Performance Ratings

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN-Unlikely, HUN=HighlyUnlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible)

Outcome: S

Sustainability. L

Institutional Development Impact: M

Bank Performance: S

Borrower Performance: U

QAG (if available) ICRQuality at Entry: U

Project at Risk at Any Time: No

3. Assessment of Development Objective and Design, and of Quality at Entry

3.1 Original Objective:

The main objective of the National Agricultural Technology Support Project (NATSP) was to reorient andimprove the technology adaptation and extension activities of the Agricultural Development Projects(ADPs) to ensure that: (a) the ADP adaptive research is aimed at the development of location-specifictechnologies for sustainable intensification of the principal farming systems, wherever appropriate,

integrating messages from crops, livestock and agro-forestry research; and (b) the extension service isunified to provide a better quality of cost-effective service to farmers of all categories, including women inagriculture. The objective was important for the country at the time of appraisal, and in line with therecommendations of the 1989 World Bank reports, Nigeria - Strategy for Agricultural Growth, andSub-Saharan Africa, From Crisis to Sustainable Growth. A Long Term Perspective, which emphasizedthe need to strengthen the agricultural technology generation and dissemination systems to provideappropriate recommendations for sustained growth. The choice of the ADPs as the implementing agenciesfor the project was based on the belief by the Federal Government of Nigeria (FGN) that the Bank-assistedADP system would continue to provide the best means of addressing the needs of the rural agriculturalpopulation. One major flaw in the objective was that it was more of a supply-driven statement of intentionsand it lacked clear indicators for measuring achievement. An attempt was made during the mid-termreview (MTR) to identify output indicators for the project components but no indicators were developed forassessing the cost-effectiveness of the service or the project impact.

3.2 Revised Objective:

The objective of the project was not revised but restated, "to strengthen, in the states of Bauchi, Kano,Jigawa, Sokoto and Kebbi, (and in a smaller way, in selected other states), the adaptation anddissemination of location-specific, environmentally sound, agricultural technology to increase farmproductivity and production on a sustainable basis." No restructuring was required.

3.3 Original Components:

The project components and their costs were: (a) Agricultural Extension, US$26.7 M; (b) AdaptiveResearch, US$7.1 M; (c) Animal Traction, US$4.9 M; (d) Agro-forestry and Soil and Water Management,US$4.8 M; (e) Administration and Finance, US$3.3 M; (f) Planning, Monitoring and Evaluation, US$3.2M; (g) Manpower Development and Training, US$1.2 M; and (h) Technology Support Facility, US$8.8M. The components were reasonably related to the achievement of the project objective.

3.4 Revised Components:

There was no formal revision of the components. However, following the MTR, fisheries extension wasadded in most states and staff of the Animal Traction as well as Agro-forestry and Soil and WaterManagement components were advised to work more closely with the Adaptive Research component forgreater synergy in technology adaptation. The number of states also increased from five to seven in 1996without a formal revision of the estimated costs of the original components.

3.5 Quality at Entry:

Overall, quality at entry is rated unsatisfactory. Although the objective of the project was consistent withgovernment and Bank priorities at the time of appraisal, it lacked monitorable impact indicators. Also, thedesign of the project focused on improving only one public service for technology development anddissemination rather than the whole system. This was in line with the Bank's policy at that time of auniform approach for planning, delivery and funding of technology services for all countries and situations,a policy that ignored the potential contributions of other key actors, such as private input suppliers, otherpublic services and non-governmental organizations (NGOs). Also, while it is to the credit of the designersthat project design was simplified by deleting the rural infrastructure and commercial services componentsthat attracted more attention in the ADPs in the past, some of the investment taken for granted in the designended up to be the key constraints to implementation. These include, the development of: (i) strategic

- 2 -

sector leadership to articulate policies for the balancing of public sector, private sector and organizedfarmer inputs, to ensure linkages and coordination among relevant agencies, and to pilot alternativemechanisms for the financing and delivery of technology services; and (ii) credit services and ruralinfrastructure, the absence of which led to poor projcct performance. No rating of quality at entry has beendone by the Quality Assurance Group (QAG) for this project.

4. Achievement of Objective and Outputs

4.1 Outcome/achievement of objective:

The outcome of the project is rated satisfactory, with a re-estimated Economic Rate of Return (ERR) of 19percent in the core states as compared with the appraisal estimate of 17 percent. The overall developmentimpact was positive and significant, in terms of the expansion in agricultural production, rural incomes,enhanced food security and reduction of rural poverty that resulted from the widespread adoption ofimproved technologies and cultural practices, especially in the fadama production areas. The project'sinstitution-building component was another important contributor to the above satisfactory outcome.Through the training and technical assistance support to the ADPs, the project helped build a critical massin management of public knowledge systems, especially in delivery of extension services and successfultransfer of know-how in project preparation and implementation work. An important caveat, however, isthat the assessment of the economic outcome is based on limited data as many of the adoption rate andimpact studies done by the ADPs do not provide consistent data on project outcome. Against thebackground of an unconducive macro-economic and sector policy environment, which included unalignedexchange rate regimes and government control of fertilizer procurement and distribution that made thecommodity unavailable to farmers, the higher re-estimated ERR is a reflection of the success of some of thetechnical components of the project. There was increased production due mainly to the adoption ofimproved crop varieties on incremental land. The expected yield increases, however, were not achieved formany crops because of the inadequate supplies of fertilizer whose distribution was controlled bygovernment. In Kebbi, for example, over the project period, the production of the major rainfed crops grewbetween 10 percent and 25 percent, compared with the appraisal estimate of 12 percent. On the otherhand, the yields of the major rainfed crops in that state increased only by 10 percent to 20 percent, ascompared with the appraisal estimate of 50 percent to 75 percent.

Wherever the farmers adopted the improved practices disseminated by the project using the required inputs,usually obtained through special distribution arrangements, the financial returns were positive. In Kebbi,for instance, the differences in returns per ha to adoption of improved practices (compared with traditionalpractices) were reported to range from 75 percent to 168 percent, compared with the appraisal estimate of26 percent to 65 percent. Although the project did not specifically target the poor as beneficiaries, it madesubstantial contribution to poverty alleviation through an improvement of the incomes of about 65 percentof the two million rural farm families, in the core states alone, that was reached by extension. About 60percent of Nigerians live in the rural areas, most of them engaged in farming as the major source of income.

The project also achieved the objective of the unification of the extension service in the states to make theservice more cost-effective. It helped build the capacity of the public sector for project management and tosustain the institutions whose capacity would have been seriously eroded with the closure of the Bank loansthat created and supported them in the past. The project management was also able to cope with anincrease in the number of states and the scope of coverage without a corresponding increase in resources.

4.2 Outputs by components:

-3 -

(a) The Adaptive Research Component was partially satisfactory. Although the componentimproved the linkages with research institutes and achieved over 80 percent of the target of On-farmAdaptive Research (OFAR) trials, it focused on crop varietal testing rather than on integrated systemsapproaches to crop management. The rate of adoption could have been much higher if the constraintsimposed by limited access to input supply constraints, especially fertilizer, were removed. Some of therecommendations developed for the dry season include improved water management techniques, highyielding varieties of tomato (Roma VF and UC82-B), wheat (Seri 82, Frond), cowpea (IT288, IT719), andIrish potato (Nicola), and for the wet season, higher yielding varieties of cotton (Samcot 10), millet(GB8735), sorghum (KSV8, ICSV400), rice (ITA150, ITA230, ITA257), as well as striga-resistantcowpea. It should also be noted that the methodology adopted by the component for research-extensionlinkage suffered a setback in 1997, when the National Agricultural Research Project (NARP) management,due to constraints in funding and the availability of scientists, directed the ADPs to conduct QuarterlyTechnology Review Meetings (QTRM) rather thani the Monthly Technology Review Meeting (MTRM).Many ADPs tried the QTRM for about two years and decided to return to the MTRMN because of the longgap in technology flow associated with the QTRM, especially when the scientists failed to attend theQTRM. A lot still remains to be done to develop effective adaptive research capacity in the states.

(b) The Extension Component was satisfactory. The extension services were successfully unified inall the ADPs, and varied rates of adoption of improved practices by farmers have been reported. In Kano,for instance, adoption rates for the 1997/98 dry season ranged from 6 percent for garlic to 62 percent forimproved tomato varieties. The production of garlic and Irish potato helped to reduce the market glutusually experienced for tomato and onion immediately after harvest. In Bauchi, studies in 1997indicated that the adoption of improved crop seed varieties ranged from 25 percent for rice to 96percent for sorghum. The adoption of improved non-crop practices could, however, have been higher.For livestock, it ranged from 10 percent for artificial brooding of day-old chicks to 15 percent forpasture feed production, and for agro-forestry, from 13 percent for alley farming to 33 percent forerosion control. The lower rates of adoption for the non-crop practices is attributed to the high costof the required inputs. In Bauchi, by providing irrigation water and some fertilizer to the farmers,average yield increases over project life of 107 percent and 176 percent for onion and tomato, respectively,were recorded as compared with the appraisal estimates of 67 percent for the two crops. However, theTraining and Visit (T&V) extension approach used by the project was perceived by the implementationagencies to be "top-down" in the development of technical recommendations rather than respondingto farmers' socioeconomic conditions and investment attitudes, and to be costly in terms of its highdemand for staff mobility and field allowances which were not readily available.

(c) The achievement of the Women in Agriculture (WIA) Component was satisfactory. Itsuccessfully formed 3,787 women groups, 75 percent of the target set by the ADPs in the core states andtrained them on improved production and post-harvest practices, small ruminant and poultry production,preparation of soybean fortified food, weaning diets, soap and pomades, the low cost treatment of potablewater, and business management. There are reports from the ADPs of improvements in family nutrition,greater access to credit from lending agencies as well as reduced dependence of the women on theirhusbands as a result of the intervention of the WIA component. Beyond the requirements of the project, theWIA unit also: (i) encouraged the formation of girls' clubs, where the members were introduced toimproved farming techniques early in their lives; (ii) championed the introduction of the Rural HIV/AIDS(RAIDS) scheme in some ADPs; and (iii) organized gender sensitization workshops to obtain the supportof policy makers, government officials, traditional and opinion leaders and husbands for the WIA program.

(d) The Animal Traction Component was satisfactory. About 755 fanrers and artisans were trainedon the fabrication and use of animal traction implements. The component also helped organize them into

-4 -

viable animal traction hire and fabricators groups, leading to a wider spread in the use of animal traction.

In Kebbi, for example, the ridgers, ploughs, weeders and decorticators, produced by the fabricator groups,

already have a good market in Niger Republic. The fabricators in Gusau (Zamfara) also produce treadle

pumps for small-scale irrigation.

(e) The Agroforestry and Soil and Water Management Component was satisfactory, helping to

ensure a sustainable production base. About 1.9 M tree seedlings, 65 percent of the target, was producedfrom project and community nurseries and individual and community woodlots established for fuelwood

and fodder. The component was less successful in the promotion of the planting of vetiver grass to check

erosion, and the planting of trees in fadama (small-scale irrigation) fields. The latter was attributed totenurial right problems in fadama lands and the former to the fragmentation of farmers plots which wouldnot allow for the planting of an effective continuous vetiver hedge. Data from the weather stations and soiland water quality monitoring facilities established under the National Fadama Development Project(NFDP) were utilized by the project in the preparation of sustainable technical recommendations for

farmers.

(f) The Project Management Component was unsatisfactory. The creation of more states out of the

existing project states helped to erode the quality of management. Also, in spite of the training of 32,768staff locally, and 297 staff overseas, in management and technical aspects, project reviews towards its end

revealed serious lapses in financial and procurement management, related to lack of transparency and

accountability in operations. Government has reached an agreement with the Bank to implement an Action

Plan to avoid a recurrence of the procurement lapses in future sector projects, and at the macro level, hasundertaken an assessment of the procurement and financial management systems in collaboration with theBank. Another weak aspect of the project management was the poor quality and consistency of the dataproduced by the monitoring and evaluation component. This made project monitoring difficult and hashampered an effective analysis of project performance in this ICR.

(g) The Agricultural Technology Support Facility (ATSF) Component was satisfactory, helping tomaintain public extension services in 29 non-core states following the closure of several Bank loans in thesector and the inability of the Government to sufficiently fund the services. The very modest facility (aboutUS$200,000 per state) produced such success stories as the wide spread of a sweet potato variety(popularly called 'yar ADP' - daughter of ADP) and early millet in Adamawa, and improved cassavavarieties, yam minisett, rabbitory, snail production and homestead fish ponds in many of the southern andmiddle belt states. The component also assisted the education and training of cooperative societies by theCooperative Financing Agencies (CFA) in Bauchi and Gombe. The CFA in Gombe facilitated access bycooperative societies to loans totaling Naira 28 M from commercial banks in the last three years. Thefacility assisted the Federal Agricultural Coordinating Unit (FACU) to manage the ATSF Secretariat,including the Centralized Special Account (CSA), to participate in supervision missions and provideimplementation assistance to the ADPs. Delays in processing Statement of Expenditure (SOE) through theCSA slowed loan disbursement at the early part of the project. Although FACU, from late 1998, improvedon its turn-around time in the processing of SOEs, a large number of applications were bunched forsubmission at the end of the disbursement grace period after loan closure, and some may be turned down bythe Bank. The Agricultural Projects Monitoring and Evaluation Unit (APMEU) supported the ADPs inproject monitoring and evaluation and it undertook a study of the impact of the T&V system of extension inNigeria, while the Agricultural and Rural Management Training Institute (ARMTI) trained some of its

staff for more effective performance. The sustenance of the capacity built in these federal agencies is amajor achievement of the project. These agencies are now providing valuable assistance to Bank staff inthe identification and preparation of new projects as the Bank resumes new lending to the country.

- 5 -

4.3 Net Present Value/Economic rate of return.

The re-estimated ERR of 19 percent is higher than the 17 percent estimated at appraisal (Annex 3),reflecting positive benefits arising mainly from the adoption of improved practices on incremental land, andincreased yields of some vegetable crops under irrigation. The ERR could have been higher but for the: (i)low yield increases achieved for rainfed crops due to inadequate supplies of subsidized fertilizers to farmers; (ii) drought conditions in most of the project areas in 1997; and (iii) floods arising from uncontrolleddischarge of water from hydro-electric dams in 1998.

4.4 Financial rate of return.

A financial rate of return was not estimated at appraisal and is not done in the ICR.

4.5 Institutional development impact:

The project made substantial contributions to sustaining public sector capacity for sectoral programsdesign and implementation. The rating here may be moderately satisfactory, due to the problems associatedwith project management, especially on the Borrower's side. The support to: (i) the ADPs forimplementation of technology adaptation and dissemination and project management; (ii) Bauchi andGombe CFA, for cooperative education; (iii) FACU, for project design and implementation; (iv) APMEU,for monitoring and evaluation; and (v) ARMTI, for training; prevented a serious erosion of the built-upcapacities in these institutions following the closure of the Bank loans that set up the agencies. TheProjects Coordinating Unit (PCU) formed from the merger of FACU and APMEU in 2000, was able toprovide implementation support to an increasing number of ADPs with limited resources, and is currentlyleading the identification and preparation of new sector projects for Bank support with the resumption oflending to Nigeria.

5. Major Factors Affecting Implementation and Outcome5.1 Factors outside the control of government or implementing agency:

Project implementation was adversely affected by:

(a) delays in the implementation of contracts and poor performance of some contractors;

(b) pastoralist-farmer and inter-community conflicts, which led to the stoppage of farm work for someperiods as well as the destruction of crops, livestock, farm equipment and even human lives;

(c) occasional dry spells as well as floods, especially in 1998, which destroyed crops in parts of thecountry; and

(d) significant violation of procurement procedures during the procurement of contracts under this project.

5.2 Factors generally subject to government control.

Project implementation was positively affected by Government's expressed support for the ADP system andits adoption of the policy on the unified agricultural extension services (UAES) in the ADP system. Thishelped the ADP to obtain the relevant staff from the state Ministry of Agriculture and Natural Resources(MANR) and to harmonize its efforts in adaptive research and extension for the different sub-sectors.Factors that adversely affected implementation include:

- 6 -

(a) lack of a sector strategy to give a focus to sectoral development and harmonize inter-agency mandatesas well as collaborative arrangements;

(b) inadequate counterpart funding by the federal and state governments and untimely release of funds,which led to the Bank insisting on the deduction at source (from the Federation Account) of the statecontributions;

(c) irregular meetings of the Agricultural Development Project Executive Committee (ADPEC) and theFederal Agricultural Projects Executive Committee (FADPEC), which led to delays in the approval ofwork programs and budgets as well as reduced oversight over project management;

(d) seizure of project vehicles by government officials, thereby depriving project staff mobility for projectactivities; and(e) scarcity of fertilizer as well as fuel for irrigation pumps which limited farmners' production capacity.

5.3 Factors generally subject to implementing agency control:

The following factors adversely affected project implementation:

(a) poor procurement planning and management, including: (i) the manipulation of shopping procedures insome ADPs through a lack of transparency in the solicitation and evaluation of bids and in the choice offirms; (ii) the splitting of contracts for vehicles and equipment as well as exceeding the aggregate limits forprocurement of goods under shopping procedure; (iii) weak contract management, including delays in portclearance and non-enforcement of performance securities and sanctions for delayed delivery andcompletion; and (iv) deficiencies in procurement filing and documentation;

(b) significant procurement violation and irregularities, which led the Bank to declare misprocurement ofthe contracts financed under this project and two other agricultural projects (Cr. No. 2261-UNI and Cr.No. 3451 UNI);

(c) weak financial control and audit, as evidenced by: (i) absence of updated fixed assets; (ii) poordocument filing; and (iii) poorly staffed Internal Audit Units that also had very limited coverage of projectactivities.

5.4 Costs andfinancing:

The latest estimated cost of the project, US$57.18 M is about 95 percent of the appraisal estimate. Foreignexchange rate depreciated by close to 1,000 percent, from US$1.00 = N 9.50 at appraisal to US$1.00 = N100.00 at the close of the loan, creating considerable strains on the federal and state governments to meettheir counterpart funding targets. The Technical Support Component cost only 73 percent of the appraisalestimate, mainly because of the high local funding required for them, and which was not readily availablefor project implementation. The Project Management Support Component of the project, on the otherhand, cost more than three times the appraisal estimate, because most of the cost elements were foreign andfully reimbursable by the Bank, an escape route for higher reimbursement of costs in the face ofinadequate counterpart funding. The cost of the ATSF was only about 65 percent of the appraisal estimatebecause of difficulties in operating the Centralized Special Account for reimbursement of projectexpenditures.

-7 -

Bank financing of the Project Management Support components ended up 2.5 times higher than theappraisal estimate, mainly because most procurement of goods and services came under these components.Most of the limited government funds were also used by the project management for these activities at theexpense of the Technical Support Component. The financing of the latter by government was only 54percent of the appraisal estimate compared to 69 percent by the Bank. Overall, the Bank funded about 71percent of project costs, same as estimated at appraisal.

6. Sustainability

6.1 Rationalefbr sustainability rating:

Under the policy environment and institutional arrangements that existed during the project, thesustainability of the project's activities was unlikely. However, the current institutional environment, bothin terms of the type of political regime in place and the enabling environment, especially in the policy area,create adequate conditions for sustainability. Overall, therefore, sustaiability is likely. These favorabledevelopments, upon which the positive rating of sustainability is based will be presented later on.Retrospectively, four major factors affected sustainability - low public commitment to research andextension as reflected by poor funding of these activities, high cost of service delivery per beneficiary underthe T & V extension approach, poor access by farmers to credit and production inputs to fully adoptimproved practices, and weak rural infrastructure. Even before loan closure. many ADPs found it difficultto pay extension staff salaries and travel allowances, leading to reduced intensity of visits to farmers. Littleattempt was made by the ADPs to try more cost-effective group approaches, and greater use of mass mediaand para-extensionists. However, a number of recent developments give hope for improved sustainabilityof technology services in the future. To address the funding issue, two states (Bauchi and Zamfara) havealready authorized deduction at source of their statutory revenue to support ADP activities. The newFederal Government (sworn in at the end of May 1999) has announced its commitment to agriculturaldevelopment as a basis for revamping the economy and has promised to release more funds for agriculturaltechnology services. It is already preparing, with the assistance of the Bank, a Rural Development Strategythat would help resolve the apparent contradictions in past rural development policies. Early in 2000, theGovernment rationalized the public agencies associated with poverty alleviation in order to reduceoverheads and make more budget resources go down to the community level. The fertilizer subsidy policythat was reinstated immediately after the Government was sworn in, in response to election campaignpromises, was jettisoned again at the beginning of 2000 and fertilizer distribution is now deregulated.Government is also trying to put in place market-oriented macro-economic policies that would remove mostof the disincentives to increased agricultural productivity, and is emphasizing greater transparency,accountability and budget discipline in the public sector, which would ensure that financial resourcesbudgeted for agricultural development would not be diverted or delayed in release. Most of the stategovernments have also announced their commitment to agricultural development.

6.2 Transition arrangement to regular operations:

With the close of this project, there is no major Bank-assisted rural sector project in Nigeria. A number ofprojects are, however, at the identification or preparation stages that could impact on the rural technologysystem. The objective of the Second Fadama Development Project currently under preparation is toovercome the production, organizational and marketing constraints which hamper smallholder privateirrigation farmers from fully utilizing their resources for fadama expansion that would lead to enhancedfood security and rural poverty reduction. The project would provide assistance for: (a) increased privatesector participation in the provision of services, including credit for production, processing and marketing,which were hitherto bottlenecks to technology adoption and resource productivity; and (b) a better

- 8 -

management of environmental concerns. The Micro-watershed and Environmental Management Project(MEMP), also under preparation, will assist communities to develop and implement sustainable andintegrated management of their natural resources in selected watersheds. A Decentralized TechnologyDevelopment and Dissemination Project is also being proposed for preparation in the second half of 2000that aims at re-orienting the research and extension services to make them more responsive to the needs oftheir clients. A pilot is proposed to test the management of extension service delivery by farmerorganizations, communities. NGOs, local government councils (LGCs) and the private sector, whileresearch would emphasize work on natural resources management and evaluation of biotechnology,competitive funding and possible privatization of research on cash crops. It is proposed to adapt theexperience emerging from the implementation of the community-based agricultural and rural developmentprojects in Katsina and Sokoto into the preparation exercise.

Within the ADP system, considerable technical capacity has been built up to provide rural technologyservices. The federal and state governments continue to make budgetary allocations to the ADPs, albeitgenerally inadequate. During the transitional phase, the cost of the MTRM can be contained by focusingon a few topics at each meeting, involving only the relevant subject matter specialists and resource persons,and encouraging the contributions of LGCs and farmer groups. A few farmer groups have alreadyindicated their willingness to contribute to the visit costs of the extension agent and this has to be exploredby the ADPs as it is a reflection of the demand for their services. The federal support agencies, FACU andAPMEU, merged to form the PCU, continue to provide valuable technical services in the current projectidentification and preparation exercise. In the seven core states, adequate arrangements are already inplace through the NFDP to monitor the likely environmental effects of future agricultural productionactivities. With regard to the procurement lapses observed in the closed project, Government has promisedto implement the Action Plan agreed with the Bank to prevent a recurrence of the lapses.

A monitoring system is already in place at the ADP and federal levels. This needs to be improved upon toprovide more reliable data and extended to the LGC level. The key indicators for monitoring performancewould be improvements in: (a) adoption rates; (b) yields of crops and livestock; (c) incomes of farners; (d)participation of women and youth; and (e) participation of LGCs, NGOs and the private sector. The Bankwould need to monitor the actions taken by the Government in relation to the Procurement Action Plan.An impact evaluation of the project could be done by the Operations Evaluation Department (OED) of theBank in the second half of 2000.

7. Bank and Borrower Performance

Bank7.1 Lending:

Bank performance in project identification is rated satisfactory. The project was identified as a follow-upto the earlier projects in support of the ADP activities and took into consideration the Government'spriorities as well as the Bank's strategy for the country. Bank staff assisted the borrower agency (FACU)to prepare the project and ensured that the Bank's safeguard policies then in operation were taken intoconsideration in project design. There were, however, a number of flaws in the design which has led to therating of quality at entry as unsatisfactory by this report. These include the lack of monitorable impactindicators, the focus on one public service for technology development and dissemination, rather thanlooking at the whole system, and the assumption that other support investments to technology adaptationand dissemination would automatically be taken care of. This assumption was proven wrong duringimplementation. Weak leadership for sectoral policy formulation and coordination, and poor credit andinfrastructure services seriously constrained the full achievement of project objectives. The appraisal team

-9-

recognized the importance of the changing macro-economic environment in the wake of the StructuralAdjustment Program (SAP), including the increase in export crop prices arising from the abolition of thecommodity boards, the reluctance of the private sector to undertake major investments in this sub-sectorbecause of the foreign exchange risks involved, and the incentive for local food production following theban on the importation of wheat, maize, rice, poultry and animal feed under SAP. The project, therefore,aimed at strengthening the agricultural technology system to respond to these incentives in the face ofdwindling fiscal resources available to support the activities of the ADPs. The appraisal was, however,inadequate in: (i) assessing the commitment of government to adequate counterpart funding of the project;and (ii) assessing the capacity of the implementing, agencies for procurement and financial management. Areview of the project towards its end revealed a number of flaws in procurement and financial managementand the counterpart funding of the project was inadequate in many states. Overall, the performrance of theBank in lending is rated marginally satisfactory.

7.2 Supervision:

Bank supervision performance appeared to be tainted by the flaws in the management of procurementoperations which were discovered almost at the end of the Project, and which may have been detected withmuch closer attention to procurement issues during supervision missions. However, based on the consistentsatisfactory outcome of project supervision, in terms both of implementation performance and developmentoutcome, overall Bank performance is rated satisfactory. This rating is based on the data in Annex 4 (p24)and the Borrower's own assessment. Nevertheless, there were insufficiencies. The planning for supervisionand the resources budgeted for supervision were inadequate for a project which covered 36 states. Thejoint Bank/Govemment supervision teams were constrained to concentrate on the seven core states and,even at that, were limited to spending two to three days per state and, therefore, placed more emphasis onthe review of the technical activities relative to other aspects of the project. With hindsight, the supervisionof the financial and procurement operations was insufficient. An ex-post procurement audit undertaken bythe Bank toward the end of the project revealed significant violation of procurement procedures andirregularities with respect to this and two other agricultural sector projects (Para. 5.3(b)). As a result ofthe said violation, the Bank declared misprocurement of contracts under the project amounting to about$1.2 million, and subsequently informed the Government that further Bank support to the agriculture andrural development sector would be contingent upon adequate and timely actions by Government to ensurethat irregularities will not reoccur. The Borrower and the Bank agreed on a procurement Action Plan,designed to achieve this objective, which is currently under implementation. In order to establishaccountability and to determine appropriate sanctions for the misprocured funds, the Government hasrecently instituted an Administrative Enquiry, under the Chairmanship of the retired Supreme Court Judge.The Committee responsible for this inquiry is expected to present its report to the Government in July2000.

7.3 Overall Bank performance:

Inspite of the poor management of procurement operations, and given the satisfactory ratings of technicalsupervision and development outcome supervision, the overall performance of the Bank is rated assatisfactory.

Borrower7.4 Preparation:

The Borrower's performance in project preparation is rated satisfactory. The design of the project wasadequate in most respects and relevant to the Government's priorities at the time. The major weakness in

- 10-

the design was the inadequate emphasis on the devolution of delivery responsibility for technology servicesto the farmer organizations and the LGCs, in order to reduce the dependence of the system on public funds.This was partly due to the preparation team's reluctance to introduce very drastic changes in institutionalarrangements which could disrupt the existing ADP system, and the farmers' expectations fromgovermment.

7.5 Government implementation performance:

Government's implementation performance is rated unsatisfactory. Although Government continued tostress its commitmnent to the ADPs, macro-economic as well as sector policies (especially related to inputsupplies, credit management and fiscal decentralization) were unstable during project implementation andperpetuated the dependence of the project activities on public resources. Counterpart funding wasinadequate at the federal level and in many of the states and releases were often delayed. The meetings ofthe executive committees of the project were irregular and this affected the quality of policy advice andguidance provided to the project management. Some state governments also frequently changed the projectmanagers without consulting the FGN and the Bank, while others interfered in the procurement operationsand diverted project vehicles to other uses.

7.6 Implementing Agency:

The performance of the implementing agencies is also rated unsatisfactory. Although the ADPs made somegains in the technical aspects of the project, most program managers were ineffective in applying soundmanagement principles, especially in procurement and financial operations, when faced with pressures fromthe political leadership, which was largely military. Staffing was inadequate in some departments of theADP, and key skills, such as, financial and procurement management as well as monitoring and evaluation,were generally lacking or inappropriately deployed. Consequently, there were deficiencies in the executionof contracts and studies, in financial management and audits, and in the quality of monitoring data.Sufficient attention was also not given by management to the participation of beneficiaries and LGCs inproject implementation.

7. 7 Overall Borrower performance.

Based on the low performance of the Government and the implementing agencies in project implementation,the overall performance of the Borrower is rated unsatisfactory.

8. Lessons Learned

The following major lessons have emerged from the implementation of the NATSP:

(a) weak sectoral leadership leading to inconsistent macro and sector policies adversely affect the outcomeof agricultural services projects and these need to be addressed upfront before Bank investment in similarprojects in future. Particular attention needs to be paid to the policies related to input distribution, credit,and produce marketing to ensure a proper incentive environment for the uptake of technology by farmers.The Govermnent, in collaboration with the Bank, is already working on the preparation of a rural sectorstrategy during the transition phase of the project and has started a review of its macro policies in thedirection of a more market-oriented, private sector-led development;

(b) Government needs to harmonize public sector as well as donor agency institutional arrangements forrural development to ensure complementarity rather than duplication among the agencies. Suchharmonization would also ensure a more focused allocation of limited public funds to priority interventions

- 11 -

for rural development;

(c) complementary investments to effective technology development and dissemination need to be put inplace or arrangements for their execution assured in the design of similar projects in future, including amore decentralized rural development management as well as a robust infrastructure;

(d) genuine empowerment of beneficiaries, communities, LGCs and the private sector through actualparticipation in the design and implementation of projects increases the sense of ownership and the chancesof sustainability of the project activities. Such projects would be less dependent on public institutionalarrangements that are rarely functional as well as public funding that is both inadequate and untimely.Such empowerment should not diminish the responsibility of government to adequately fund ruraltechnology services, but allow for innovative and more effective service delivery; and

(e) Bank supervision of similar projects in the future needs to be better planned and funded to allow for theappropriate duration, breadth and coverage of project activities, and to focus more on solving problemstowards the attainment of development objectives. The weak supervision of the procurement and financialaspects of this project arising from the non-provision in supervision missions for staff with the requisiteskills, resulted in a number of flaws in procurement and financial management operations which were notdetected until towards the end of the project. The flaws included uneconomic procurement, lack oftransparency in the process and exceeding the aggregate limits prescribed for the procurement of goods andservices through the shopping procedure. The consequence has been the declaration of misprocurement bythe Bank and a requirement of the government to demonstrate tangible action to ensure that such problemswould not occur in the future before new projects can be approved by the Bank. The key lesson here is thatsupervision that focuses only on the technical aspects of technology services projects may hinder futuresupport to projects in the agricultural sector, and the need for such support remains very strong in theBank's fight for poverty alleviation..

9. Partner Comments

(a) Borrower/implementing agency:

(1) EXECUTIVE SUMMARY OF BORROWER'S ICR

1.0 PROJECT BACKGROUNDAs a follow-up to earlier Bank-assisted Projects the NATSP was designed to provide specific support toADP activities in technology adaptation and dissemination. The project was appraised in February -March 1990 and the agreement for a loan of US$42.5 million was signed between the World Bank and theFGN on August 25, 1992. The sum of US$35.9 million or 84% of the IBRD loan was to be on-lent to thecore states of Bauchi, Gombe, Jigawa, Kano, Kebbi, Sokoto and Zamfara while the remaining US$6.6million was to be used as facility or bridging funds by other states and the federal agencies. The loanbecame effective in june 1993 and came to a close on December 31, 1999.

2.0 PROJECT OBJECTIVES AND COMPONENTSThe NATSP had two main objectives:(a) to assist the ADPs to develop, adapt and extend location specific technologies required for sustainableagricultural development;(b) to assist the ADPs to reorganize and unify agricultural extension service.

The main components for achieving these objectives are:- On-farm adaptive research- Reorganization and unification of agricultural extension service

- 12 -

- Women-in-agriculture- Animal traction- On-farm agro-forestry and soil and water conservation- Project management and- Agricultural Technology Support Facility.

3.0 EVALUATION OF PROJECT OBJECTIVESThe NATSP objectives were specific, well focused and relevant to the needs of small farmers andconsistent with government agricultural policy to achieve self-sufficiency, food security, poverty alleviationand environmentally sustainable agricultural system for the country. Project design was simple and derivedfrom the lessons of implementation of earlier projects.

4.0 LOAN COVENANTSSome of the major loan covenants meant to facilitate the achievements of NATSP objectives include: (i)unification of state extension service, (ii) the establishment of Agricultural Development Programs LiaisonCommittee by each state ADP, (iii) employment of experienced and qualified staff to man key posts, and(iv) ADPs to sign an agreement with selected national institutions on support for adaptive research andplanning, monitoring and evaluation.

5.0 ACHIEVEMENTS OF PROJECT OBJECTIVES (CORE STATES)5.1 Technology Development and AdaptationThe activities of technology development and adaptation in the crop sub-sector of the core states focused ondiagnostic surveys, on-station and on-farm adaptive research trials, technology review meetings andsponsored research. All the states performed satisfactorily in the implementation of these activities andmost of the physical targets were met. Some of the technologies which emerged from these trials and weretransferred to extension for adoption by farmers include improved crop varieties (millet varieties GB8735and SOSAT-C88; sorghum varieties KSV8, ICSV400 and ICSC11; rice varieties SIPP144, ITA150,ITA230 and ITA257; cowpea varieties IT-719, IT374-12 and IT-288; tomato varieties Roma VF andUC82-B; wheat variety Seri 82) and introduction of new crops (garlic, Irish potato and industrialsugarcane).

The fisheries component concentrated on the promotion of cheap and affordable post-harvest technologiesrelating to capture fisheries, aquaculture and post-harvest activities. Some of the technologies which wereextended to and adopted by farmers were Burkinabe fish smoking kiln and. the Malian traps in fish farning.mass adoption of homestead fish pond was constrained by scarcity of fingerlings.

The efforts of the livestock component were concentrated on animal health (vaccination against majorprevalent diseases of livestock and deworming of small ruminants) and upgrading of local chicken withexotic cockerel. Lack of emphasis on other aspects of livestock production was attributed to inadequatesupport from livestock-based research institutes.

The activities of the agro-forestry. soil and water conservation component were focused at inception on theproduction of fruit trees and forest tree seedlings for distribution to farmers. Direct seedlings productionby the ADPs was stopped after the Mid-Term Review in 1997 and seedlings were obtained through linkagewith Forestry II project. The ADPs provided support to farmers for the establishment of community andindividual nurseries. The overall performance of the ADPs in seedlings production and the establishmentof individual and community nurseries was satisfactory. There was generally low demand for seedlings byfarmers. Despite the SAR provision of cost-recovery from seedlings distributed to farmers some states(Jigawa, Bauchi, Sokoto and Zamfara) distributed the seedlings free of charge throughout implementationperiod.

The animal traction which was subsumed under livestock component initially was upgraded into a full

- 13 -

component after MTR to enhance performance and have a better focus. Different types of implements suchas ridgers, plough, harrows and simple farm implements were sourced locally and from overseas forintroduction and promotion by the core states during implementation. The major activities were directed attraining extension staff, farmers, and fabricators, testing and demonstration of implements and assistance inthe formation of farmer and fabricator groups. Existing animal traction training centers were rehabilitatedin Gombe, Bauchi, Jigawa, Kano, Kebbi and Sokoto states. The adoption of AIT implements werehowever constrained by high cost of implements and the difficulty in accessing credit from financialinstitutions.

5.2 Technology Dissemination (Extension)In order to achieve cost-effectiveness and provide better services to farmers, extension staff from thenon-crop sub-sectors of the state Ministries of Agriculture were transferred to the ADPs and agriculturalextension services were unified with each VEA providing integrated messages to farmers in crops, animalhusbandry, agro-forestry, fisheries, animal traction and land management. However, disproportionateemphasis is still on crops sub-sector as demonstrated by the number of SPATs and MTPs in cropscompared to those of non-crop sub-sectors.

As at project completion there was shortage of VEAs except in Gombe and Kebbi with achievement of98% and 100% respectively of staff required in place. Worst hit were Kano and Sokoto where the dearthof VEAs has kept the VEA:FF ratio as high as 1:1840 and 1:3220 respectively. None of the states exceptKebbi achieved the SAR target of VEA:FF ratio of 1:1000 throughout the project implementation. Thegovernment embargo on direct recruitment during the project life made it difficult to fill the vacancies.

The main thrust of the extension delivery is farmer visits by VEA/BEA and supervised by BES and othersenior extension officers. The targets set for VEA/BEA were fairly mat as the cumulative achievementduring the project life were over 60% in states except Bauchi and Zamfara that recorded 50% and 43%respectively. The reasons adduced for the inability of the states to fully meet the set targets include: (i)inadequate mobility, (ii) persistent shortage of petroleum products, and (iii) irregular payment of travelallowance.

There was shortage of motorcycles/mopeds for the VEAs/BEAs/BESs throughout the projectimplementation except Gombe and Kano States which recorded 100% achievement of planned targets at theend of the project. The mobility situation was more severe in Sokoto and Zamfara with achievement 22%and 7% respectively of target as at the end of project. The mobility situation during project implementationwas compounded in Kano, Bauchi and Gombe with the purchase of the wrong model of motorcycles withno spare parts. About 50% of the motorcycles were grounded in Kano and bicycles were provided toVEAs/BEAs as replacement.

SPATs, Demonstration and MTP are important extension delivery methodologies for farmer training.SPATs and MTPs were exclusively restricted to crops while demonstrations were used for technologytransfer in the non-crop sub-sector. The performance of most states in the implementation of targets set forwet and dry season SPATs was satisfactory with cumulative achievement ranging from 60% to 83%despite the mobility constraints of VEAs/BEAs, except in Sokoto and Kano with 525 and 47% achievementrespectively. The ADPs adopted the MTP which is total package/technology demonstration to complementSPAT in technology delivery to farmers during the second half of the project. An impressive achievementranging from 75% to 109% were recorded by the ADPs.

The media support to Extension was largely concentrated on radio programs with overall cumulativeachievement of 85% and to some extent state TV and mobile shows. Most of the states (Jigawa, Kano,Bauchi and Sokoto) have media centers with radio and TV recording studio and well equipped. In additionto the media unit, some states produced video documentary and training films, drama and promotionalsongs to effectively support extension delivery. Special publicity campaigns were also regularly mounted

- 14 -

in Jigawa throughout the project life to promote technology adoption and utilization.

6.0 FACTORS THAT AFFECTED THE IMPLEMENTATION OF NATSPNATSP implementation was positively influenced by the following factors: (i) the quality and stability ofADP management and technical team, (ii) government support, (iii) regular supervision by the Bank andfederal agencies, and (iv) linkage with research institutes, NGOs and donor agencies.

Project implementation was constrained by two sets of factors: those subject to implementing agenciescontrol and those subject to government control. Among the factors subject to implementing agenciescontrol are: (i) lack of transparency in procurement process and poor contract management, (ii) delay inprocurement, and (iii) delay in processing SOEs through Centralized Special Account.

Factors subject to government control are: (i) irregular ADPEC meetings, (ii) inadequate and untimelyrelease of counterpart funds, (iii) prolonged and acute shortage of petroleum products, (iv) inconsistency ingovernment policies, (v) lack of access to inputs, especially fertilizer and credit, (vi) unfavorable economicand political environment, and (vii) farmers-pastoralists conflict.

7.0 ASSESSMENT OF PROJECT OUTCOMEProject outcome is rated satisfactory. Most of the physical targets relating to technology adaptation anddissemination activities in the core states were achieved and the adoption of project improved technologieshas resulted in yield increases for both rainfed and irrigated crops. The benefit-cost ratios for rainfed cropsrange from 1.3 in maize to 1.9 for yam/cassavalmaize mixture. The benefit-cost ratios for irrigated maize,rice and wheat are 1.4, 1.5 and 1.7 respectively. Estimated financial rate of return (FRR) is 22.7% whileestimated economic rate of return (ERR) is 33.9% (* The calculation is being reviewed and it is likely thatthis figure may change in the final report). The project contributed significantly to institutionaldevelopment and capacity building.

8.0 BANK AND BORROWER'S PERFORMANCEBank and Borrower's performance in the identification and appraisal of the project was satisfactory.Although supervision missions were regular, they failed to pay adequate attention to procurement mattersand financial management. Overall, the Borrower's performance is marginally satisfactory. Althoughgovernment demonstrated its commitment by providing policy support and counterpart funds for projectoperations, the funds were inadequate and releases were irregular and untimely. The management of thecentralized Special Account was fraught with problems and delays which adversely affected the overallperformance of the facility states. The procurement audit conducted by the Bank towards the end of theloan period revealed serious anomalies in the procurement process and financial management by the SIAs.

9.0 PROJECT SUSTAINABILITYThe sustainability of the NATSP achievements is likely given the already well-established institutionalframework and capacity for technology adaptation and dissemination under the ADP system, the strongcommitmnent demonstrated by government towards the end of loan period and the fact that the focus of ADPactivities is consistent with government priority to achieve food security and poverty alleviation for thecountry. The new democratic government which assumed office in May 1999 has identified with the ADPas the implementing organ of government agricultural policies and many of the state governments havedemonstrated their commitment by increasing subventions to the ADPs.

10.0 KEY LESSONS LEARNTThe major lessons learnt from the implementation experience of the NATSP are:(i) The experience of farmers who participated in the MTPs has demonstrated that given access toproduction inputs, adequate extension support and production incentives, small farmers can easily increasetheir production by three or four times.(ii) There is still dearth of proven technology in the non-crop sector to meet small farmers' needs.

- 1 5 -

(iii) All parties to a loan agreement must strive to fulfill their obligations to ensure the full realization ofproject objectives.(iv) Future project design should adopt full participation approach to extension delivery and research trials.(v) In future the Bank and the federal supervising agencies should ensure that the implementing agenciescomply fully with laid down procurement and financial management procedures in order to ensure properaccountability and transparency.

11.0 COMMENTS BY BORROWER ON DRAFT ICR

The National Agricultural Technology Support Project (NATSP) for which the World Bankprovided a loan of US $42.5 million closed on December 1999. The draft World Bank ImplementationCompletion Report (ICR) has been forwarded to us for comments in line with the normal procedure inpreparing such reports for World Bank Assisted Projects. The Borrower's ICR is being expected and whenproduced the findings in the Borrower's ICR will be married with the Bank's ICR in order to produce afinal ICR reflecting the correct views of the Bank and the Borrower on project performance.

2. The main objective of the NATSP was to re-orient and improve the technology adaptation andextension activities of the Agricultural Development Projects (ADPs) to ensure that:

I. the ADP adaptive research is aimed at the development of location - specific technologies forsustainable intensification of the principle farming system, wherever appropriate, integrating messagesfrom crops, livestock and agro-forestry research.

II. The extension service is unified to provide a better quality of cost effective service to farmers of allcategories, including Women In Agriculture (WIA).

The objective of the project was restated thus, "To strengthen, in the States of Bauchi, Kano,Jigawa, Sokoto and Kebbi (and in a smaller way, other selected States), the adaptation and disseminationof location specific, environmentally sound, agricultural technology to increase farm productivity andproduction on a sustainable basis.

3. Comments:

3.1 Paragraph 3.5 Lines 2 - 5 "The obiective of the proiect was not clear and lacked monitorableimpact indicated". As stated in para. 2. I - II and the restated objective in paragraph 3.2 page 2, thedesign objective of the project was clear. However it is true that there were no monitorable indicators andthis is a weakness in the project design and may have been responsible for the unsatisfactory overallranking for "Quality at Entry".

When the project was designed the commercial services of the ADPs were converted intoInput Supply Companies and were responsible for input provision in the ADPs. The idea was to convertthen into viable financially sustainable outfits. A combination of poor management and lack ofcapitalization in certain instances were responsible for the failure of almost all the Input SupplyCompanies, except the Bauchi and Gombe Credit Finance Associations. In effect the situation on theground at the time of the Staff Appraisal Report of this project favoured commercialization of theCommercial Services Sub Programs of the ADPs.

The ranking of unsatisfactory here tended to judge the project with the prevailing conditions as at

- 16 -

now, as opposed to the prevailing condition at appraisal.

3.2 Under Achievement of Objective and Outputs which is paragraph 4 of the report the EconomicRate of Return (ERR) was 19 percent which was revised to 21 percent in paragraph 4.3 of the report page11 is higher than the Appraisal Target of 17 percent. We do not agree with the assertion that the recordedincreases in output were as a result of expansion of hectarage under cultivation alone as stated in paragraph4.1 line 4.5 page 3 and does not agree with the assertions on paragraph 4.3. There were undoubtedlyproductivity increases. However we appreciate the data inconsistency, which usually emanates from theADPs. There is a need for future projects to not only emphasize data retrieval and consistency but toprovide adequate resources for this critical component Presence of a well funded and equipment ProjectMonitoring and Evaluation subprogram could be a condition for eligibility.

Under project outputs by components we do not agree with the ranking of marginallyunsatisfactory. With an 80 percent achievement recorded in improved linkages with Research Institutesand adoption of improved high yielding planting materials one finds it difficult to agree with this ranking.It is true that the Monthly Technology Review Meeting (MTRMs) was momentarily replaced withQuarterly Technology Review Meetings (QTRMs) due to fund inadequacy at a time the ADPs reverted toMTRMs after trying out the QTRMs.

The ranking of the Project Management Component as unsatisfactory just because of theProcurement Audit Query is unacceptable. Procurement as a means to an end is critical. However it is acomponent of the activities needed to achieve a specific goal based on the project objectives. There is nodoubt that that to considerable extent project objectives were achieved and this can be attested to by theoutput increases recorded in the production of major grains as well as roots and tubers in the last few yearsand which is expected to continue which cannot be divorced from the farmers adoption of the newtechnologies being disseminated by the ADPs.

ON ATSF: While agreeing that more funds could have helped the activities of the 29 non-core States,Govemments, particularly the Federal Government, in the last 2 - 3 years of project life improved itsfunding of the ADPs, although the releases may not however have been timely. We agree that there weredelays in processing of SOEs initially however we appeal that all duly presented SOEs that got to the Bankbefore loan closure should be reimbursed, in order not to repeat the difficulties caused by suchnon-reimbursements under the Fadama Phase I project.

Again paragraph 7.6 under Implementing Agency, the criticisms seem to be based on theProcurement Audit Query rather than objectively looking at the totality of the achievements under thisproject. The paragraph needs to be revisited.

(b) Cofinanciers:

No cofinancier.

(c) Other partners (NGOs/private sector):

No other partner.

10. Additional Information

None.

- 17-

Annex 1. Key Performance Indicators/Log Frame Matrix

Outcome I Impact Indicators:

(a) Yield increase for major crops (%) Bauchi Kano Kebbi- Sorghum 50 40 29 20- Millet 60 5 20 10- Maize 50 16 11 19- Rice (iirigated) 67 NA NA 22- Tomato (irrigated) 67 176 5 6- Onion (irrigated) 67 107 31 (9)-Cowpeas 267 5 62 72

(b) Rainfed crop production growth over Kebbiproject life (%)-Sorghum 12 17- Millet 12 13-Maize 12 10-Rice 12 25-Cowpea 12 12

(c) Difference in return per ha. betweentraditional and improved practice (%) Kebbi

- Sorghum 45 75- Millet 51 134-Rice 64 168- Sorghum/Millet mixture 52 161- MilletVSorghum/Cowpea mixture 26 101

Note: NA = Not Available

- 18 -

Output Indicators:

Indicator/Matrix J Projecied it last PSR ActuaU/Latest Estimate

On-Farm Adaptive Research (No.) Percent(a) OFAR trials - crops 8,735 7,233 (83)

- non-crops 2,054 1,665 (81)(b) technology review meetings 378 346 (91)

Extension (No.)(a) farm visits by extensionists 1,886,546 972,695 (52)(b) small adoption plots (crops) 662,538 436,032 (66)(c) livestock/fisheries demonstrations 38,183 19,640 (51)(d) extension agenttfarm family ratio 1:1,000 1:1,598 (63)(e) WIA - women groups formed 5,023 3,787 (75)

- demonstrations 30,496 41,001 (134)

Animal Traction (No.)(a) extension staff trained 708 485 (69)(b) farmers/artisans trained 1,603 755 (47)

Agroforestry/Soil-Water Managem. (No.)(a) tree seedlings produced 2,900,550 1,893,090 (65)(b) demonstrations 17,976 11,736 (65)

Project Management (No.)(a) Staff training - local long term 2,831 1,338 (47)

- local short term 53,688 31,430 (59)- overseas 351 297 (85)

(b) Planning Monitoring & Evaluation- quarterly/annual reports 205 201 (98)- adoption/impact studies 24 23 (96)

Agric. Technology Support Facility (No.)(a) crop OFAR trials 733,098 400,194 (55)(b) women groups formed 15,595 10,148 (65)

(c) extension agent/farm family ratio 1:1,000 1:3,693 (27)

End of project

- ici

Annex 2. Project Costs and Financing

Project Cost by Component (in US$ million equivalent)

05 i~~~~~~~~~~~~~~~tulILt ifercentae o0.E :~:f

A. For the Core StatesTechnical SupportAdaptive Research 6.30 4.59 72.9Agricultural Extension 23.30 12.23 52.5Animal Traction 4.40 7.14 162.3Agroforestry and Soil and Water Management 4.30 4.08 94.9

B. For the Core StatesProject Management SupportAdministration and Finance 2.90 9.68 333.8Planning, Monitoring and Evaluation 2.80 10.19 363.9Manpower Development and Training 1.00 3.06 306

C. Agricultural Technology Support Facility 9.60 6.21 64.7

Total Baseline Cost 54.60 57.18Physical Contingencies 3.40 0.00Price Contingencies 2.00 0.00

Total Project Costs 60.00 57.18

Total Financing Required 60.00 57.18

Project Costs b Procurement Arran ements (A raisal Estimate) (US$ million equivalent)

"ffead' v~~~~Pocreet Mett:to';

1. Works 0.00 3.80 0.00 0.00 3.80(0.00) (3.60) (0.00) (0.00) (3.60)

2. Goods 15.10 1.20 2.50 0.00 18.80(13.70) (1.00) (2.20) (0.00) (16.90)

3. Services 0.00 0.00 5.40 0.00 5.40(0.00) (0.00) (5.40) (0.00) (5.40)

4. Miscellaneous 0.00 0.00 23.20 0.00 23.20- Operating Costs

(0.00) (0.00) (10.00) (0.00) (10.00)

5. Miscellaneous 0.00 0.00 8.80 0.00 8.80- Agricultural (0.00) (0.00) (6.60) (0.00) (6.60)

TechnologySupport Facility

6. Miscellaneous 0.00 0.00 0.00 0.00 0.00(0.00) (0.00) (0.00) (0.00) (0.00)

Total 15.10 5.00 39.90 0.00 60.00(13.70) (4.60) (24.20) (0.00) (42.50)

-20 -

Project Costs by Procurement Arrangements (Actual/Latest Estimate) (US$ million equivalent)

Expenditure Catei3 y 408 2 N.S.F. Total Cost

1. Works 0.00 5.10 0.00 0.00 5.10(0.00) (3.61) (0.00) (0.00) (3.61)

2. Goods 12.79 0.64 2.87 0.00 16.30(10.61) (0.53) (2.53) (0.00) (13.67)

3. Services 0.00 0.00 10.73 0.00 10.73

(0.00) (0.00) (7.60) (0.00) (7.60)

4. Miscellaneous 0.00 0.00 18.84 0.00 18.84- Operating Costs

(0.00) (0.00) (9.80) (0.00) (9.80)

5. Miscellaneous 0.00 0.00 6.21 0.00 6.21- Agricultural (0.00) (0.00) (5.82) (0.00) (5.82)

TechnologySupport Facilityv

6. Miscellaneous 0.00 0.00 0.00 0.00 0.00(0.00) (0.00) (0.00) (0.00) (0.00)

Total 12.79 5.74 38.65 0.00 57.18(10.61) (4.14) (25.75) (0.00) (40.50)

" Figures in parenthesis are the amounts to be financed by the Bank Loan. All costs include contingencies.

v1 Includes civil works and goods to be procured through national shopping, consulting services, services of contractedstaff of the project management office, training, technical assistance services, and incremental operating costs related to(i) managing the project, and (ii) re-lending project funds to local government units.

Project Financing by Component (in US$ million equivalent).Perentage of Appraisal

__ _ _ _ _ ____ _ _ __C Ree G,' C>F..1'.' F

A. For the Core States 0.0 0.0 0.0Technical Support 0.0 0.0 0.0Adaptive Research 5.18 1.96 0.00 3.67 0.92 0.00 70.8 46.9 0.0Agricultural Extension 18.28 8.47 0.00 9.78 2.45 0.00 53.5 28.9 0.0Animal Traction 4.01 0.82 0.00 4.69 2.45 0.00 117.0 298.8 0.0Agroforestry and Soil and 2.93 1.89 0.00 2.79 1.29 0.00 95.2 68.3 0.0Water Management

B. For the Core States 0.0 0.0 0.0Project Management 0.0 0.0 0.0

SupportAdministration/Finance 2.33 0.96 0.00 4.32 5.36 0.00 185.4 558.3 0.0Planning, Monitoring 2.21 1.00 0.00 6.42 3.77 0.00 290.5 377.0 0.0

and EvaluationManpower Dev./Training 0.96 0.20 0.00 3.01 0.05 0.00 313.5 25.0 0.0C. Agricultural 6.60 2.20 0.00 5.82 0.39 0.00 88.2 17.7 0.0

Technology SupportFacility

Total 42.50 17.50 0.00 40.50 16.68 0.00 95.3 95.3 0.0

- 21 -

Annex 3: Economic Costs and Benefits

Table 3A summarizes the economic analysis for the project, while Table 3B compares the benefit-costratios for the adoption of improved practices generated and disseminated by the project, at appraisal and atthe ICR stage.

1. The economic rate of return (ERR) of 17 percent estimated at appraisal, based on a cost ofUS$51.31 M for the core states (85 percent of total cost), assumed that:

(a) the major project benefits would come from the expansion of area under irrigation for rice and wheat(five percent per year), and the adoption of the improved practices (water control, crop husbandry,fertilizer, seed, pesticides); and(b) the area of the rainfed crops brought under the improved practices would increase by two percent eachyear. Total production would increase at an annual rate of 1.7 percent over the 20 year life of the project.With improved practices, yield would increase by 50-75 percent for sole cereal crops, 267 percent forcowpea, and 20-75 percent for crop mixtures.

2. The re-estimated ERR of 19 percent is based on a cost of US$50.97 M for the core states (89percent of total estimated cost), and reflects:

(a) an irrigated production regime that emphasized vegetables (chiefly onion and tomatoes) rather than riceand wheat which were more dependent on the availability of fertilizer; and(b) increased production (10-25 percent) for major rainfed crops due mainly to expansion of area undercultivation, as well as increases in yield of onion and tomatoes (over 100 percent) when irrigation water andfertilizers are available to farmers.

3. The assumption of farm-level profitability of the improved practices was sustained as shown by thepositive benefit-cost ratios for all the crops and mixtures, for farmers who could acquire the fertilizer andother inputs required for the adoption of the improved practices.

-22 -

Table 3A. Economic Costs and Benefits for the Seven Core States

Cost Benefit Net Benefit Net Present ERRState (N million) (N million) (N million) Value (N (percent)

million)Bauchi 2,259.60 3,723.20 1,463.60 145.95 17Gombe 684.60 1,702.50 1,017.90 284.16 21Jigawa 1,391.24 3,019.24 1,628.00 127.82 16Kano 955.61 2,820.72 1,865.11 210.40 18Kebbi 1,837.50 3,457.60 1,620.10 200.74 19Sokoto 964.49 3,344.57 2,380.08 367.47 22Zamfara 884.56 1,938.38 1,053.82 140.35 22All 1,492.34 19

Table 3B. Increased Financial Benefits and Costs for the Major Crops (Naira per hectare)

B:C RatioCrop/Crop Mixture Incremental Benefits Incremental Costs at ICR at appraisalSorghum_ 1,712 1,170 1.5 1.4Millet 1,392 993 1.4 1.1Maize 1,497 1,420 1.1 1.6Rice 1,397 1,012 1.4 1.6Cowpea 1,651 1,411 1.2 1.5Groundnut 2,151 2,019 1.1 1.4Millet/Cowpea 2,110 1,918 1.1 1.1Millet/Sorgh./Cowp 2,531 1,959 1.3 1.2eaSorghum/Groundnu 1,350 1,112 1.2 1.0tSorghum/Millet 1,145 863 1.3 1.3

- 23 -

Annex 4. Bank Inputs

(a) Missions:

Stageof Prot Cyclee No. of Persons andSpcialty Performance Rating(e.g. 2 Economists, I FMS, etc.) Implementation [ Development

Month/ear Count Prgss t: ObjectiveIdentification/Preparation

3/90 1 AG

6/90 8 AG, EC, FA, EDS, WIAS

10/90 3 AG, ES

Appraisal/Negotiation2/91 8 00, EC, AG, EDS, FA,

WIAS

Supervision11/92 3 RE, AG, PA S HS2/93 2 RE, AG S HS7/93 3 RE, AS, FA S HS7/94 4 AG, WIAS, 00 HS S10/94 3 00, PA, AG S S4/95 3 AG, PA, RE S S8/95 2 OO, PA S S3/96 2 OO,PA S S2/97 3 00, AG, ES S S6/97 1 00 S S11/97 3 OO, AG, WIAS S S5/98 4 OO, IS, AG S S3/99 5 AG, 00, FMS, TA, WIAS, RDS S S12/99 6 AG, FMS, PS, TA S S

ICR3100 1 EA U S

AG = Agriculturist; AS Accounts Specialist; EA = Economic Analyst; EC = Economist; EDS =Education Specialist; ES = Extension Specialist; FA = Financial Analyst; FMS = Financial ManagementSpecialist; IS = Implementation Specialist; 00 = Operations Officer; PA = Projects Auditor; PS =Procurement Specialist; RE = Rural Engineer; RDS = Rural Development Specialist; TA = TaskAssistant; WIAS = Gender Specialist

-24 -

(b) Staff

Stage of Project Cycle ActualLatest Estimate________________________ No. Staff weeks US$ (,000)Identification/Preparation 100.40 242.8Appraisal/Negotiation 47.60 121.3Supervision 275.2 514.99ICR 14.3* 39.18Total 437.48 918.27

* Includes Actual and Planned SWs

-25 -

Annex 5. Ratings for ARhievement of OIbjectives/Outputs of Components

(H=High. SU=Substantial. M=-Modcst, N=Negligible. NA=NIot Applicable)Rating

Z Macro policies .JH f SU C M 0 N 0 AA

Z Sector Policies H h SU 3 M * N OD lYAO Physical .H SU M A N ON.AZ Financial H ) .SU C M ON *NAS Institutional Development H CD SU * M 0) N O V4Z Environmental . 0 SU C M O N OAA

SocialX Poverty Reduction H CJ SU * M C N C NA

J Gender H , SU O4 M C N ATh4O Other (Please speci jj2 Stu A M 0 N O NA

Z Private sector development H OSU O M 0 N *NTAK Public sector management C. hCG Su O M 3 N O NAO Other (Please speciht) H l C SbU 3 M 3 N C AA

26 -

Annex 6. Ratings of Bank and Borrower Performance

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory)

6.1 Bankperformance Rating

Z Lending OHSOS OU OHUFX Supervision OHS OS *U OHUN Overall OHS OS * U O HU

6.2 Borrower performance Rating

M Preparation O HS * S O u O HUZ Government implementation performance 0 HS O S 0 U 0 HUZ Implementation agency performance O HS O S * U O HU

Z Overall OHS OS *u O HU

-27 -

Annex 7. List of Supporting Documents

1. Map

-28-

MAP SECTION

IBRD 23561

G E R7

12 ~ ~ 1 12

o .. ~~~~~~~~~~~

/' " I (~~~~~~~~~~~~~~~~~~~~~~~C HAD

NATIONAL AGRICULTURAL

240 ~~~~~~~~~~~~~~~~~~~~~~~~~TCHNOLOGY SUPPORT PROJECT2 MAJOR VEGETATION ZONES a

`..[S lwo.n

EcoIog,~~~oI Zon,s,,,,~~~, ~ ~ ~ ~ D~~o~io, o om .,l o

0 00 40 00 ~~~~~~~~~~~~~ 100 20 40 100 ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ d

40 0,40,000000 NOT2~~~~~~~ 2COLOGY AFTeR KEAY 0 CLAITON ~ S-t- GW

0. 12~~~~~~~~~. -1S4

F.-t~ ~ ~ EBURY19