Evaluation of the agricultural development assistance/Sahel development fund program (685-0249)

External evaluation covers FY 1984 and is based on document review and interviews with private importers and officials from USAID/S, the Government of Sengal (GOS), and the Senegalese Agricultural Research Institute (ISRA). Despite factors beyond their control (e.g., high U.S. sulphur prices), importers were able to effectively import and distribute urea and sulphur. Past financial problems for this type of program, such as considerable GOS arrears in payments to private distributors and banks, were avoided. The GOS undertook agreed upon policy changes in regard to liberalizing fertilizer marketing and pricing, providing agricultural credit, and reducing both the GOS debt to the banking sector and the deficit of the Price Equalization and Stabilization Fund (CPSP). Due to increased contacts of USAID/S personnel with GOS and private sector personnel and the collaborative effort between USAID/S and ISRA on the local currency-funded marketing studies, the program directly strengthened USAID/S's expertise and influence in the fertilizer sub-sector. USAID/S is now the leading donor in advocating and tracking policy change in this area. Also, the greater availability of fertilizer as a result of this program was probably a factor in maintaining, and perhaps increasing, fertilizer consumption at a time when total subsidies were being cut by more than two thirds. Lessons learned include, inter alia, that: (1) privatization and the lifting of subsidies are best implemented gradually and need to be accompanied by dialogue and research; (2) where a climate of mistrust exists, in this case between GOS and private importers, donors must be willing to play a lead role; (3) CIP effectiveness is closely linked to the commodities involved; (4) local currency and TA activities closely related to the relevant sub-sector are generally the most effective activities; (5) in their present form, CIP's are an inefficient way of transferring balance of payments support; and (6) USAID/S has little legal ground for forcing private importers to make deposits to local currency accounts according to deposit schedules stipulated in the grant agreement.