AID organization

program in Uruguay prior to phasing out Mission operations and turning over residual A.I.D. activities to the U.S. embassy. Audit report covers the period 7/75-9/79 and is based on site visits, document review, and interviews with cooperative, contractor, and USAID/U personnel. USAID/U has made satisfactory progress in phasing out the program. Four grant projects have been completed and a fifth will end in 8/80. All the grant projects have been reasonably successful, with no major deficiencies. There are, however, three loan projects requiring attention. The Agricultural Research Technical Assistance (ARTA) Loan project has had administrative, logistic, and counterpart problems, and as currently structured cannot be completed within its allotted time. If the project is redesigned, its success will be contingent upon Government of Uruguay (GOU) support. USAID/U has not yet planned a follow-up program for returned participant trainees. Objectives of the Agricultural Cooperative Loan project have not been achieved although all funds have been disbursed. USAID/U efforts to strengthen the institutional capacity of the Cooperativa Agropecuaria Limitada de Sociedades de Fomento Rural (CALFORU), the implementing agency, have been unsuccessful and managerial and financial problems persist. Purchase of a $600,000 fruit packing line by CALFORU is pending. The goal and purposes of the Agri-Industry Development Loan project will probably be attained by 3/80, the final disbursement date. However, USAID/U has not made end-use checks of equipment received by loan recipients and the implementing agency, the Ministry of Industry and Energy (MIE), has not filed progress reports since 6/78. USAID/U should: (1) submit the new ARTA project design to AID/W for review and approval before formally accepting the design; (2) ensure that the GOU will support the ARTA project before releasing remaining funds; (3) implement a follow-up program for returning trainees; (4) require CALFORU to provide evidence of purchasing the fruit packing line and claim a refund if the line is not purchased; (5) require the MIE to submit required reports; (6) schedule end-use equipment checks; and (7) request the GOU to immediately schedule a financial audit of the Agri-Industry Development Loan.