AGRIBUSINESS AND ARTISANRY

Evaluation covers the period 1/78-4/80 and is based on reports from the Bolivan Central Bank (BCB), the implementing agency, and a BCB/AID survey of select subprojects. A poor liquidity situation in intermediate credit institutions (ICI) due to political instability delayed implementation until 5/79. Nonetheless, the A&A fund is now fully functioning in eight of Bolivia"s nine departments, with 15 ICI"s participating, and should be fully disbursed by the project"s termination date. As of 9/30/80, 169 of 171 targeted subloans, totalling $4 million against a target of $3.7 million, had been disbursed. However, only 507 of 1,338 targeted jobs had been created, with most subprojects surveyed being modifications of existing enterprises instead of new enterprises -- indicating that A&A funds are being used for working capital and not for labor costs. ICI unfamiliarity with project loan procedures has often delayed disbursement. The TAF has been poorly used to date, with only $113,176 of the target of $416,000 funds expended. This has been due to the lack of training of ICI loan officers (a point overlooked in the project design) and to the lack, since 8/79, of a project administrative advisor. The following recommendations are made: (1) USAID and BCB should restrict A&A sublending to maximize job creation and adjust project interest rates to prevailing commercial rates. (2) A report should be submitted to AID/W on BCB"s need in the next 3 years to mechanize its management and evaluation operations. (3) BCB should submit plans to train ICI loan officers in project-related procedures and to inspect the development aims of subprojects. (4) A long-term administrative advisor should be contracted as soon as the political situation permits. (5) Future TA funds should be withheld until BCB submits an approved plan for TA fund utilization. (6) Credit application requirements and subloan documentation should be reviewed in order to determine ways to facilitate the subloan approval process.