Evaluation of small farmer supervised credit, project no. 664-0302

Evaluation covers the period 10/78-5/80 and is based on field studies by the National Center for Agricultural Studies. Project administration was moved from the Direction of Vegitative Production (DPV) office to the ministerial Office for Assistance to Small and Medium Scale Farmers (DAPME) because the DPV was overburdened with other projects. This move noticeably improved managerial performance, but also delayed project implementation, as did the slowness of the National Bank of Tunisia (BNT) in informing its branches of responsibility in the project, processing loans, and reimbursing suppliers of commodities. Moreover, BNT reporting services have been incomplete, making loan monitoring difficult. The project was also slowed by initially scarce supplies (especially fertilizer and D-5825 wheat seed), availability of machinery, and processing delays. Nevertheless, progress has been significant. Nearly 1,000 loans, totalling over $500,000, have been made, with nearly two-thirds going to farmers holding 20 hectares or less and the rest to holders of 20-50 ha. Project area growers receiving at least one supervisory visit rose from 35% to 95% in 1978/79 and crop yields generally increased as the amount of land left fallow was reduced and the use of fertilizers, seed varieties, and herbicides and contact between farmers and credit extension agents rose markedly. Forage production increased 41% and diversification patterns have improved. The project's economic impact, however, while generally positive, has been uneven. Farmer revenues increased in humid areas but decreased in arid areas due to climatic conditions. The loan reimbursement rate has averaged 42% (and is now approaching 61%), with the best rate found among smaller farmers. Many farmers expect to repay their loans gradually as money is received on the sale of other crops. The recovery rate should improve further as weather conditions improve and project inputs increase. Evaluation is attached to project PES (PD-AAG-130-B1).