Guangdong Tropical Crops Development Project (Loan 1175--PRC)

7/31/2019 Guangdong Tropical Crops Development Project (Loan 1175--PRC)

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ASIAN DEVELOPMENT BANK PPA: PRC 23156

PROJECT PERFORMANCE AUDIT REPORT

ON THE

GUANGDONG TROPICAL CROPS DEVELOPMENT PROJECT(Loan 1175PRC)

IN THE

PEOPLES REPUBLIC OF CHINA


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CURRENCY EQUIVALENTS

Currency Unit yuan (CNY)

At Appraisal At Project Completion At Operations Evaluation(June 2002) (May 1999) (November 2001)

CNY1.00 = $0.1831 $0.1205 $0.1208$1.00 = CNY5.4621 CNY8.3000 CNY8.2767

ABBREVIATIONS

ADB Asian Development BankEIRR economic internal rate of return

FIRR financial internal rate of returnha hectareIDC interest during constructionm2 square meterNPV net present valueOEM operations evaluation missionPCR project completion reportPPAR project performance audit reportPRC Peoples Republic of China

t tonTA technical assistanceWTO World Trade Organization

NOTE

In this report, $ refers to US dollars.


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CONTENTS

Page

BASIC DATA iiEXECUTIVE SUMMARY iiiOVERVIEW viMAP viii

I. BACKGROUND 8

A. Rationale 8B. Formulation 8C. Objectives and Scope 8D. Cost, Financing, and Executing Arrangements 9E. Completion and Self-Evaluation 9F. Operations Evaluation 10

II. PLANNING AND IMPLEMENTATION PERFORMANCE 11

A. Formulation and Design 11

B. Achievement of Outputs 12C. Cost and Scheduling 13D. Procurement and Construction 14E. Organization and Management 14

III. ACHIEVEMENT OF PROJECT PURPOSE 16

A. Operational Performance 16B. Performance of the Operating Entity 16C. Financial and Economic Reevaluation 18D. Sustainability 19

IV. ACHIEVEMENT OF OTHER DEVELOPMENT IMPACTS 21

A. Socioeconomic Impact 21B. Environmental Impact 21C. Impact on Institutions and Policy 21

D. Overall Assessment 22E. Overall Project Rating 24F. Assessment of ADB and Borrower Performance 24

V. ISSUES, LESSONS, AND FOLLOW-UP ACTIONS 25

A Key Issues for the Future 25


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BASIC DATALoan 1175-PRC: Guangdong Tropical Crops Development Project

Project Preparation/Institution Building

TANo.

Project Name Type Person-Months

Amount ($) Approval Date

1504 Tropical Crops Development PPTA 35.0 420,000 11 April 19911740 Policy Studies and Institutional

Strengthening for the Ministryof Agriculture

ADTA 16.5 800,000 13 August 1992

Key Project Data ($ million)As per ADB Loan

DocumentsActual

Total Project Cost 109.70 139.70Foreign Exchange Cost 55.00 55.90Local Currency Cost 54.70 83.80

ADB Loan Amount/Utilization 55.00 55.00ADB Loan Amount/Cancelation 0.00

Key Dates Expected ActualAppraisal 923 April 1992Loan Negotiations 810 July 1992

Board Approval 13 August 1992Loan Agreement 4 September 1992Loan Effectiveness 14 November 1992 19 November 1992Loan Closing 31 May 1998 31 May 1998Project Completion 30 November 1997 31 May 1998Months (effectiveness to completion) 61 66

Key Performance Indicators (%) Appraisal PCR PPAR

Economic Internal Rate of Return 23.2 13.1 10.3Financial Internal Rate of Return 19.0 17.7 28.4

Borrower Peoples Republic of China

Executing Agency General Bureau of Guangdong Land Reclamation and Farm Enterprises

Mission Data Missions Person-Days

Type of MissionAppraisal 1 126Inception 1 18Project Administration

Review 5 119Project Completion 1 153


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EXECUTIVE SUMMARY

After 1978, the Government of the Peoples Republic of China (PRC) embarked on

major economic reforms to reduce state controls and rely more on market signals to guide theeconomy. A major policy objective of the Governments Eighth Five-Year Plan was tostrengthen agriculture and the rural economy. The Project was designed in line with the planand the 19921994 country operational program for the PRC of the Asian Development Bank(ADB). ADBs loan of $55 million and a technical assistance (TA) grant of $800,000 wereapproved in August 1992. The General Bureau of Guangdong Land Reclamation and FarmEnterprises (General Bureau) was the Executing Agency.

The project objectives were to (i) improve efficiency in tropical crop production andprocessing, (ii) increase rural incomes and jobs, and (iii) promote economic reform in theagriculture sector and state farm system. The Project comprised five components: (i) replantingabout 8,000 hectares (ha) of rubber trees with high-yielding rubber trees, maintaining about7,670 ha of young rubber trees, expanding an existing presswood manufacturing factory, andestablishing a rubber-based product factory; (ii) rehabilitating about 13,300 ha of sugarcane,expanding an existing sugar mill, and establishing a new sugar mill; (iii) replanting about 2,700ha of sisal, expanding an existing sisal leaf processing facility, and upgrading the existing sisalyarn processing factory; (iv) planting about 7,670 ha of trees for windbreak forests and industrial

tree plantations, expanding an existing chipwood factory, and building a new chipwood factory;and (v) constructing a marketing and trading center. The advisory TA was to help theGovernment promote market reforms and strengthen the institutional capabilities of the GeneralBureau.

At appraisal, the total cost of the Project was estimated at $109.7 million equivalent, ofwhich $55.0 million was foreign exchange and $54.7 million equivalent, local currency. The ADBloan from ordinary capital resources was to finance the entire foreign exchange cost, excluding

$11.5 million of interest during construction, and $11.5 million equivalent of the local currencycost. The actual project cost at completion amounted to $139.7 million, which comprised $55.9million foreign exchange cost and $83.8 million equivalent local cost. The local cost overrun wasattributable to higher-than-expected costs of construction works and equipment, and wascovered by domestic bank loans and joint-venture partners.

The Project achieved its major output objectives except for the presswood factory. Therubber and forest tree plantations and the existing chipwood factory were modified due toexternal factors.

Rubber tree replanting and maintenance were completed ahead of the appraisalschedule. A typhoon in 1995 destroyed about 4,000 ha of newly planted rubber trees, whichwere replanted with fruit trees. The Project established a rubber-based product factory. Thefactory supplies rubber parts for cars and electric appliances, and rubber racetrack material forstadiums. The presswood factory, which was to produce doors and doorframes, encounteredt h i l d fi i l diffi lti f th b i i Th t i ld t tt t l f


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Sugarcane rehabilitation was completed as planned. The Project supported constructionof a new sugar mill and expansion of an existing one. Both factories are operating above their

design capacity.

Sisal replanting was completed ahead of schedule. The Project established a sisal leafprocessing factory, which is operating above its design capacity. A sisal yarn factory startedoperating 3 years behind schedule due to a change in production line design.

By the end of 1994, 7,667 ha of tree plantations were established. The 1995 typhoondestroyed about 4,000 ha of the plantation, and the area was replanted with fruit trees. Thestate farm bureaus and farmers bore the replanting cost. A chipwood factory established in

1991 received retroactive financing under the Project. Although its capacity exceeds theappraisal target, the factory is operating below its capacity due to the low price of chipwood. TheProject supported the establishment of another factory to produce chipwood for export.However, the factory was redesigned to produce plywood for the domestic market rather thanprocess chipwood because the planned port facility was never built.

The marketing and trading center was built and is now used as rental office space.About half the total area of 24,000 square meters is occupied. Due to the depressed real estate

market, the rest is not expected to be occupied soon.

The Projects operational performance in increasing crop yield and the output capacity ofagroprocessing enterprises against appraisal targets has been satisfactory. Rubber, sugarcane,and sisal production increased due to the high-yielding new varieties and improved cropmanagement. The agroprocessing enterprises, except for the chipwood factory, are operatingwith production capacity greater than the appraisal target.

The Project created 12,600 jobs. Its preparation and the subsequent advisory TA helped

the General Bureau develop staff skills and overall operational capabilities. As provided in theLoan Agreement, all the agroprocessing enterprises were incorporated. However, workersshareholding did not increase to the target level, nor did it induce higher productivity.

Since 1999, the General Bureau has been incurring a net lossCNY210 million in2001attributed to social expenses not related to production but to workers medical,educational, and housing subsidies, and pensions for retired workers.1 The Projectsagroprocessing enterprises are also financially weak. In 2000, of the Projects seven

agroprocessing enterprises, four incurred losses and three had after-tax profits. As theyintroduce new products, agroprocessing enterprises producing rubber-based products, sisalyarn, and plywood are expected to become more profitable.

Overall, the Project is assessed as sustainable. Rubber replanting and maintenance areexpected to be sustainable as the new high-yield variety of rubber makes it more competitive.The sugarcane plantation and sugar mills are financially viable at the domestic price maintained


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sustainability and resilience of the plantation and mills depend on the General Bureausrestructuring efforts. The PRC is a major sisal exporter and WTO accession benefits the sisal

sector. The sisal-related components are sustainable. Based on their rate of return, forest treeplantations are sustainable. However, the profitability of the chipwood factory is vulnerable tothe market and to price changes. The plywood factory is expected to be sustainable if thefactory maintains its present profit level from the sale of doors and doorframes.

The financial and economic internal rates of return for the whole Project are 28.4% and10.3%, respectively.

The Projects rationale to make agriculture and agroprocessing more efficient through

market reforms was and still is relevant. The General Bureau diligently followed the agreed-upon implementation arrangements and achieved most of the physical output objectives. Whilethe plantations achieved sufficient rates of return, the agroprocessing enterprises suffered fromthe inefficient management system of state-owned enterprises. Overall, the Project is expectedto be sustainable due to the General Bureaus improved rubber yield and comparativeadvantage in sisal. The General Bureaus efforts to restructure the plantation and enterprisemanagement system will enhance sustainability. The General Bureau made laudable efforts totransform itself from a Government-subsidized organization into an independent business

enterprise. If the Project had not been implemented, this process would have taken longer. TheProject is rated successful.

An important lesson is that if a project involves marketing products and services, aconservative demand projection and detailed distribution planning are required. An optimisticmarket forecast based on a short-term market boom tends to induce overinvestment and mayresult in business failure. ADB should ensure that project preparatory TA includes marketdemand forecasts when a project involves commercial marketing activities. Another lesson isthat investments in protected sectors will delay restructuring efforts by operating entities,

preserve inefficient institutional arrangements, and may eventually lack sustainability. For futureagriculture projects, ADB should ensure that feasibility studies include adequate comparativeadvantage analysis of crops, and assess the effects of policy change such as governmentprotection and subsidies, and the related implications for sustainability and financial viability.When price or trade liberalization is expected, an appropriate impact analysis should be carriedout. ADB-financed projects should pursue liberalization and deregulation of the agriculturesector and avoid delaying the restructuring of inefficient sectors.

As a follow-up action, the General Bureau should develop a medium-term operationalplan to ensure financial viability of the plantations and agroprocessing enterprises.


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I. BACKGROUND

A. Rationale

1. In 1978, the Government of the Peoples Republic of China (PRC) embarked on majoreconomic reforms to reduce state controls and rely more on market signals to guide theeconomy. The Eighth Five-Year Plan (19911995) promoted reforms in enterprise managementand price controls, and fostered greater dependence on market forces. Strengtheningagriculture and the rural economy, a major policy objective of the plan, was to be achieved by (i)deepening reforms in the contract responsibility system,1 (ii) promoting agricultural, scientific,and technological advances, and (iii) continuing reforms in the agricultural and pricing system.

The country operational program for the PRC (19921994) of the Asian Development Bank(ADB) supported the plan and recognized the need to raise productivity in agro-industries andreform enterprises. The Project was designed to make tropical crop production and processingmore efficient, increase rural incomes and jobs, and support economic reform policies.

B. Formulation

2. ADB approved a project preparatory technical assistance (TA) to increase the productionof natural rubber and expand processing capacity under the General Bureau of GuangdongLand Reclamation and Farm Enterprises (General Bureau) in the southern province ofGuangdong in 1991.2 The original project proposal comprised rubber cultivation and processing.During the July 1990 Reconnaissance Mission, the project scope was expanded to includesugar, sisal, and forest trees. The feasibility study started in August 1991 and was completed inJanuary 1992. The TA consultants carried out a socioeconomic survey and environmentalstudies, the results of which were incorporated into the project design. Loan appraisal wasconducted in April 1992. ADBs loan of $55 million and an advisory TA grant3 of $800,000 wereapproved in August 1992. The Borrower was the PRC.

C. Objectives and Scope

3. The project objectives were to (i) improve efficiency in tropical crop production andprocessing, (ii) increase rural incomes and jobs, and (iii) promote economic reform policies inthe agriculture sector and state farm system. The Project also aimed to reduce poverty bycreating jobs in farm and processing enterprises, and providing income-generatingopportunities.4

4. The project scope included (i) replanting about 8,000 hectares (ha) of rubber trees withhigh-yielding rubber trees, maintaining about 7,670 ha of young rubber trees, expanding anexisting presswood manufacturing factory, and establishing a rubber-based product factory; (ii)rehabilitating about 13,300 ha of sugarcane, expanding an existing sugar mill, and establishinga new sugar mill; (iii) replanting about 2,700 ha of sisal, expanding an existing sisal leafprocessing facility, and upgrading an existing sisal yarn processing factory; (iv) planting about


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chipwood factory, and building a new chipwood factory; and (v) constructing a marketing andtrading center in Guangzhou City for primary and processed agricultural products. Location of

the project components is shown on the Map.

5. The attached advisory TA was to help the Government promote market and pricingpolicy reforms and strengthen the General Bureaus institutional capability to implement theProject. The TA activities included (i) a study on pricing, marketing, and trading practice forrubber and sugar; (ii) a study on the establishment of a rubber replanting fund; (iii) developmentof a corporate action plan for agroprocessing enterprise reform; (iv) consulting services to theGeneral Bureau to introduce commodity marketing and trading and international accountingstandards; and (v) training for General Bureau staff on crop management techniques and

project management.

D. Cost, Financing, and Executing Arrangements

6. At appraisal, the total cost of the Project was estimated at $109.7 million equivalent, ofwhich $55.0 million (50%, including interest during construction [IDC] of $11.5 million) wasforeign exchange, and $54.7 million equivalent, local currency. The ADB loan of $55.0 millionfrom ordinary capital resources was to finance the entire foreign exchange cost, excluding $11.5

million of IDC, and $11.5 million equivalent of the local currency cost. The remaining $54.7million was to be met from the General Bureaus reserve ($29.3 million), domestic banks ($19.3million), and agroprocessing enterprise workers cash contribution ($6.1 million), which was tobe converted to equity capital. The ADB loan was to cover costs of replanting, maintenance,and rehabilitation of crops; factory expansion and construction works; equipment and materials;consulting services; and training. Loan proceeds for local currency costs were to be used tofinance labor costs in the crop development component.

7. The ADB loan to the Government was based on ADBs pool-based variable lending rate

system for US-dollar loans, with a fixed amortization period of 25 years, including a grace periodof 7 years. The proceeds of the loan were re-lent to the General Bureau on the same conditionsas the ADB loan. The interest rate variation and foreign exchange risks were borne by theGeneral Bureau.

E. Completion and Self-Evaluation

8. ADBs Project Completion Review Missionvisited the Project in May 1999. Circulated in

May 2000, the project completion report (PCR) concluded that the Project attained its majorobjectives by increasing crop yield, production, and farm income, as well as by advancingagricultural reform.5 The PCR rated the Project generally successful.6 The PCR reported that

job creation was under the target level. The distribution effect of the project benefits could notbe identified and a follow-up survey was recommended to monitor the Projects socioeconomicimpact. The covenant that workers shareholding in the agroprocessing enterprise shouldincrease to 25% was not fully complied with because the sugar mills declining profitability


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9. The PCR accurately evaluated the Projects outputs and operational achievements butdid not separately assess the TAs impact on the Governments reforms in agriculture pricing

and trade policies in rubber and sugar. The PCR reevaluated the financial internal rate of return(FIRR) for the various components and the Project as a whole. At appraisal, the FIRR andeconomic internal rate of return (EIRR) for the whole Project were estimated at 19.0% and23.2%, respectively. The PCR recalculated them as 17.7% and 13.1%. This was unjustifiablyhigh because (i) none of the agroprocessing enterprises except for the sisal factories had a netprofit, and (ii) domestic prices of the Projects major agricultural crops declined significantly.7The PCRs FIRR and EIRR for the rubber and sugar components were not substantiatedbecause when the Project was completed, the rubber-based product factories and sugar millswere incurring losses, and prices of rubber and sugar had declined to below appraisal

estimates. Details of the FIRR and EIRR for the sisal leaf processing, sisal yarn processing,plywood factory, and marketing and trading center components were not provided in the PCR.

F. Operations Evaluation

10. This project performance audit report (PPAR) is based on the findings of the OperationsEvaluation Mission (OEM), which visited the PRC from 15 October to 4 November 2001. Specialattention was given to evaluating production efficiency improvement in the agricultural crop and

agroprocessing components, and of the income and employment impact on the General Bureaustaff workers and outgrowers. The General Bureaus institutional changes in relation togovernment reform measures and the impact of the advisory TA were analyzed. The PPAR alsotakes into account a review of the PCR; the appraisal report and materials in ADB files;additional operational data; and discussions with officials of the General Bureau, othergovernment agencies, farmer representatives, and ADB staff. Comments from the GeneralBureau and ADB staff concerned were considered in finalizing the PPAR.


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II. PLANNING AND IMPLEMENTATION PERFORMANCE

A. Formulation and Design

11. The original project concept was drawn from a proposal for an integrated agriculturaldevelopment project produced by the General Bureau in 1989. The project preparatory TAsfocus on three main cropsrubber, sugar, and sisalreflected the Governments desire todevelop crops with high comparative advantage and high foreign exchange saving and/orearning potential.8 The OEMs review found the consultants recommendations for new cropvarieties, field management, and yield estimates in the feasibility study to be appropriate.

However, the consultants reports did not provide market analysis and demand forecasts for theagroprocessing enterprises products. The General Bureau, which had been under a state priceadministrative system until 1991, had little experience with marketing and pricing. The initial lowprofitability of the rubber-based product factory (para. 36) and the closure of the presswoodfactory (para. 14) were partly attributed to the lack of market analysis. Cost-effectivenessanalysis for alternative crops and agroprocessing enterprises was not carried out during projectformulation.

12. The PRCs comparative advantage in and the Government's price protection for theProjects two major cropssugar and rubberwere raised at the staff review committeemeeting, management review meeting, and board meeting. A board member suggested thatthe rubber and sugar studies of the attached TA should be undertaken with a view towardssatisfying the principles of the General Agreement on Tariffs and Trade9 as well as anyunderstanding that might be forthcoming in the Uruguay Round. The feasibility study included acomparative advantage analysis of the project crops but not an impact analysis of tradeliberalization. The comparative advantage analysis was insufficient to support investment inthose two crops. The feasibility study reported that the PRCs production cost for rubber was

approximately 25% higher than in the major producing countries. The PRCs sugar productioncost was lower than that of Indonesia and the Philippines, but other major sugarcane-producingcountries such as Brazil and Cuba and were excluded from the comparison. Approval of theProject was based on the expectation, raised by the feasibility study, that the PRC wouldbecome more competitive in rubber and sugar production.10 The EIRRs for the rubber and sugarplantation components were over 12%, based on price projections at that time (para. 37).

13. The Project underwent several changes. Two typhoons in 1995 and 1996 destroyed

about 4,000 ha out of 8,000 ha of newly planted rubber trees and 4,000 ha of industrial treeplantations. The affected area was replanted with fruit trees (lychee, longan, and green plum)because rubber trees had a longer gestation period (78 years) and natural rubber wasbecoming less profitable.11 Fruits were outside the project scope. The state farm bureaus andfarmers bore the replanting cost.


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14. The presswood factory encountered technical and financial difficulties from the verybeginning. It could not attract loans from domestic banks, and no companies joined the initialbidding for equipment. The presswood factory was to produce doors and doorframes, but theequipment procured from a German manufacturer through direct purchase was for presswood,not for door production, and the enterprise lacked the technical personnel to follow up theadjustment of the equipment. The factory was constructed and started test production in 1997,but the quality of the product was inadequate. As the real estate market was depressed, factorymanagement decided to cease production. The factory was officially closed in 1999 and theequipment sold or adopted by the state farm bureau. The factory premises were returned to thelocal government. The proposal for door and doorframe production was based on optimisticmarket demand because of the construction boom in Guangdong at the time of project

formulation. The consultants reports did not provide longer-term demand projections orrecommendations on product marketing and distribution. By the time the Project was approvedand factory construction started, the real estate construction market had slowed and the factorycould not attract local investment.

15. The Project included building a factory to produce chipwood for export. However, duringimplementation, the local governments plan to build a port facility was canceled. The factorywas redesigned to produce plywood for the domestic market, and started operating in 1995 witha joint-venture investment by the General Bureau and a local investor. During the first 5 years,the factory made little profit due to the low price of and limited marketing network for plywood. In2000, the factory began producing doors and doorframes through self-financed investment andbecame more profitable (para. 36).

16. The General Bureau used loan proceeds of $7.85 million to establish a transportcompany with an additional $1.25 million investment from the General Bureaus own resourcesand a local bank loan.12 The transport company owns 59 vehicles (43 trucks and 16 dumptrucks) and serves mainly the state farm bureaus and agroprocessing enterprises under the

General Bureau by transporting primary agricultural products. Until 1999, 70% of the clientswere farms under the General Bureau. However, at the end of 1998, the sector was opened forprivate sector participation, and farms under the General Bureau now have access to cheaperprivate transport companies. The company became less profitable and has been incurringlosses since 2000. The transport company was not part of the original project design.

B. Achievement of Outputs

17. The Project achieved its major output objectives except for the presswood factory.Appendix 1 comprises the project outputs with appraisal targets.

1. Rubber Development

18. Rubber tree replanting and maintenance were completed ahead of the appraisalschedule. About 8,000 ha of old rubber trees were replanted with new varieties, and about


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2. Sugar Development

19. Sugarcane rehabilitation was completed as planned. The Project supported theconstruction of a new sugar mill and expansion of an existing one. The new sugar factory,Huafeng Sugar Mill, started operating in 1995 and has a daily processing capacity of 4,000 tons(t) of sugarcane, 2,000 t more than the Projects design capacity. The Project expanded theproduction capacity of the already existing Guangfeng Sugar Mill, from 3,500 t/day to 6,500t/day. In 2001, the factory operated above its design capacity.

3. Sisal Development

20. Sisal replanting was completed ahead of schedule. By the end of 1994, about 2,700 haof sisal were replanted. A sisal leaf processing factory was established under the Project. Thefactorys production capacity is 1,600 t/day, well above the original design capacity of 250 t/day.

A sisal yarn processing factory started operating in 1996, 3 years behind schedule, due to achange in production line design. The factorys production capacity is 3,800 t/year, almost twicethe original design capacity of 2,000 t/year.

4. Forest Tree Development

21. The Project supported eucalyptus tree plantations for industrial use. By the end of 1994,7,667 ha of tree plantations were established but the 1995 typhoon destroyed about 4,000 ha(para.13). A chipwood factory established in 1991 received retroactive financing under theProject. The factorys original design capacity was 15,000 t/year. The factory processes 20,000t/year, below its operating capacity of 45,000 t/year, due to the low chipwood price. The Projectsupported the establishment of another chipwood factory but it was redesigned to produceplywood (para. 15).

5. Marketing and Trading Center

22. The Project supported the construction of a marketing and trading center, which wassupposed to provide office space to private and public enterprises, exhibition and conferencehalls, and a communication and information center for marketing and trading agriculturalproducts. The building, with 24,000 square meters (m2) office space, was built with 50% joint-venture capital from a private company from Hong Kong, China, and is now used as rental officespace. In 2000, 11,000 m2 were occupied. Due to the depressed real estate market, the rest isnot expected to be occupied soon. The center houses a trading company under the GeneralBureau, which markets the bureaus products.

C. Cost and Scheduling

23. The actual project cost amounted to $139.7 million, 27% higher than the appraisalestimate of $109.7 million, due to higher-than-expected cost of construction works and


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revised it to increase production capacity. The construction of the presswood factory wasdelayed due to difficulties with procurement, and disbursement of local loans (para. 14). Theloan closed on 31 May 1998 as stipulated in the Loan Agreement.

D. Procurement and Construction

25. Goods and services were procured in accordance with ADBs Guidelines forProcurement. The summary of actual procurement against appraisal target is in Appendix 5 ofthe PCR (footnote 5). The equipment for the presswood factory was procured through directpurchase because of lack of response to bidding (para. 14).

26. International consultants were to be hired for 6 person-months to assist in equipmentinstallation, operator training, and environmental management of the sisal yarn processingfactory, sugar mills, and rubber-based product factory. The ADB standard recruitment processfor international consultants did not dovetail into the start-up of the agroprocessing enterprises,and the General Bureau instead assigned qualified personnel for those tasks. The $200,000allocated at appraisal for consulting services was reallocated for procurement of productionequipment for the agroprocessing enterprises.

E. Organization and Management

27. The organization and management structure for the Project proved appropriate. Agreed-upon implementation arrangements were closely followed except for the use of internationalconsultants. Annual financial and audited account statements were submitted promptly andregularly. The General Bureau was expected to carry out a socioeconomic benefit monitoringsurvey following the format of the 1992 socioeconomic baseline survey of the feasibility study(para. 2), taking into account farm incomes and asset ownership of the project beneficiaries.However, this approach was not followed as the General Bureau collected only number of jobs

generated under the Project. The state farm bureaus under the General Bureau lacked theexpertise to conduct socioeconomic surveys, and the Project did not help develop these skills.

28. ADBs support for the Project was satisfactory. ADB conducted annual review missionsthroughout project implementation. Issues raised by the bureaus were addressed. However,issues related to the presswood factory could have been taken up more promptly. Two signalsindicated that the factory was not appropriate for market conditions. In September 1993, theGeneral Bureau advised ADB that no bids were received for the factory equipment.14 InNovember 1993, ADB expressed concern that the factory had difficulty raising financing fromthe domestic banks.15 The two incidents implied that the factory design was not technicallysound and the factorys profitability was uncertain. Subsequent ADB loan review missionsliaised with domestic banks to raise loans. However, a major reorientation of the componentshould have been considered.

29 Major covenants were complied with The Loan Agreement included a clause for the


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was 8.8% in 2001.16 The workers shares are ordinary common shares. The General Bureausaccounting practice follows the 1999 Accounting Law, which requires transparent accountingand unbiased auditing. The law is not fully compatible with international accounting standardsbut is closer to them than previous accounting practices.17 The General Bureau was to extendvillage joint-venture programs to make outgrowers18 contribute land and labor. The GeneralBureau was to contribute capital, technology, and management assistance. Where the village

joint-venture program did not exist, the General Bureau was expected to provide extensionservices to outgrowers to facilitate their adoption of new technologies. The OEM could notconfirm that such village joint ventures and extension services were extended to outgrowers.


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III. ACHIEVEMENT OF PROJECT PURPOSE

A. Operational Performance

30. The Projects operational performance is determined by comparing actual crop yieldsand agroprocessing enterprises output capacity with appraisal targets.

31. Under the Project, the per hectare production of rubber increased by 16%, that ofsugarcane by 13%, and that of sisal by 60%,due to new high-yielding varieties and improvedcrop management.19 Crop yields against appraisal targets are summarized in Table 1.

Table 1: Operational Performance Indicators: Crop Yields

Appraisal Actual Increase

Crop Target 1990 Baselinea PPAR (%)

Rubber (dry) 1.31.4 t/ha 0.93 t/ha 1.08 t/hab 16Sugarcane 100 t/ha 83.5 t/ha 94.0 t/ha 13Sisal Fiber 3.4 t/ha 2.7 t/ha 4.3 t/ha 60Eucalyptus Trees 70 m3/ha 82 m3/ha = no data available, ha = hectare, m

3= cubic meter, PPAR = project performance audit report, t = ton.

a Feasibility study, February 1992.b

Actual yield of rubber trees, which were 8 years old at the time of the OEM. It will increase to about 2.5 t/ha atmaturity (1215 years).

Source: General Bureau of Guangdong Land Reclamation and Farm Enterprises.

32. The agroprocessing enterprises, except for the presswood and plywood factories (whichformerly produced chipwood) as well as the rubber-based product factory, have a productioncapacity higher than the appraisal targets (Appendix 1). The agroprocessing products are ofhigh quality. The rubber-based product factory sells 50% of its products to three major

Japanese manufacturing companies and received an ISO 9002 certificate in 2001. The sugarmills received the Ministry of Agricultures acceptance certification for sugar quality. The sisalyarn factory reduced roughness of yarn and improved quality by introducing new equipment.

B. Performance of the Operating Entity

33. Appendix 3 summarizes the 19951999 financial statements of the General Bureau. Theagroprocessing enterprises established under the Project account for only part of the overall

financial performance of the General Bureau. Their assets represent 17% of total assets andgenerate 22% of gross profits.

34. Since 1999, the General Bureau has been incurring a net loss, attributed to socialexpenses related not to production but to workers medical, educational, and housing subsidies,and pensions for retired workers.20 The OEM estimates that approximately 15% of the GeneralBureaus total revenue is spent on workers welfare 21 The General Bureau is trying to improve


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for higher crop productivity, and entering into new businesses. As a result of these efforts, thenet loss was reduced from CNY393 million in 1999 to CNY210 million in 2001.

35. At the time of the PCR, most of the agroprocessing enterprises had not made a profit.The OEM found no significant improvement in financial performance since then. In 2000, theagroprocessing enterprises, except for the sisal and chipwood factories, recorded losses aftertaxes (Table 2).

Table 2: Financial Performance of Agroprocessing Enterprises for 2000(CNY million)

Item

Rubber-BasedProduct

GuangfengSugar Milla

HuafengSugar Millb

Sisal LeafProcessing

Sisal YarnProcessing

ChipwoodFactory

PlywoodFactory

Gross Revenue 14.80 118.88 84.50 45.55 27.23 9.52 3.69

Costs for Raw Materials 10.60 89.30 60.00 23.68 20.87 5.20 2.09

Other Operational Expenditures 5.74 23.59 25.60 7.79 3.87 2.92 1.04

Gross Operating Profitc

(1.54) 5.99 (1.10) 14.10 2.49 1.40 0.54

Profit before Tax (1.96) 5.73 (1.10) 3.38 1.96 1.40 (0.21)

Profit after Tax (1.96) (3.33) (11.70) 7.32 1.27 0.60 (0.21)

Net Fixed Assets 36.98 291.86 160.70 5.60 27.02 2.90 9.27Long-Term Loans 26.78 91.37 117.30 4.35 20.92 2.60 2.50

Total Assets 63.88 346.85 209.60 6.70 31.02 3.90 19.26

Performance Indicators

Operating Expenditure/Revenue(ratio)

1.10 0.95 1.01 0.69 0.93 0.85 0.85

Return on Operating Revenued

(%) (13.2) 4.5 (1.3) 7.4 7.2 14.7 (5.7)a

Expansion.b

New construction.c Before depreciation and loan service costs.d Profit before tax and operating revenue.Source: General Bureau of Guangdong Land Reclamation and Farm Enterprises.

36. The rubber-based product factory had net losses for the first 5 years of operation. Sincea new manager was appointed in 1998, the factory diversified its product range and is expectedto improve its financial performance. The factorys estimated profit for 2001 was CNY163million, of which CNY150 million was to be generated from the rubber racetrack, and CNY13million from other rubber parts. The two sugar mills incurred losses due to low sugar prices upto 1999. In 2000, the PRCs domestic sugar price increased and the mills are expecting net

profits for 2001.22 At the 2001 price, the sugar mills are financially viable. The viability ratio interms of operating expenditure to revenue will improve from 0.95 for Guangfeng Sugar Mill and1.01 for Huafeng Sugar Mill in 2000, to 0.65 and 0.89 in 2001. However, the present higherdomestic price is due to Government import controls, which comprise import quotas, tariffs, andstate distribution systems. The PRCs accession to the World Trade Organization (WTO) isexpected to gradually reduce the domestic price (para. 40). Sisal leaf processing was profitable


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became more profitable (para. 15). During the first 3 quarters of 2001, the plywood factory had anet profit of CNY2.4 million.

C. Financial and Economic Reevaluation

37. The OEM reestimated the FIRRs and EIRRs (Table 3 and Appendix 4). As someagroprocessing enterprises had only negative net revenue flows, or a revenue flow that wasmarginal against investment, their FIRRs and EIRRs were not calculated. In addition to theFIRRs and EIRRs, net present value (NPV) at 12% was calculated. The reestimated FIRR forthe entire Project is 28.4%, and the EIRR, 10.3%. The reason for the significant differencebetween the FIRR and the EIRR is that higher domestic prices of dry rubber, sugar and

chipwood as a result of the tariffs and import restrictions cause net resource transfer to theproducers. All agriculture crop components have positive FIRRs and EIRRs except forsugarcane rehabilitation. The price projections for rubber and sugar for 2002 onward are basedon the World Bank commodity price projections, which predict that the price of rubber willincrease by 16% by 2015 relative to 2001, and that of sugar by 12% in 2003 relative to 2002.Sensitivity tests were carried out to check the robustness of the FIRRs within the historic andpredicted price ranges. Rubber production is relatively competitive as the lowest price during theProject still yields FIRR above 12% due to the new high-yielding variety. The NPV of thesugarcane plantation under with-project and without-project conditions is negative, whichimplies high labor intensity and production cost (para. 40).

38. The discrepancy between the positive appraisal estimates of the FIRR and EIRR of theagroprocessing enterprises and their negative NPV calculated by the OEM is attributable tounderestimation of operation and maintenance costs at appraisal and a more than 50%increase in input costs, including labor costs during implementation. As for the marketing andtrading center, the FIRR and EIRR were not calculated at appraisal. The negative NPV for thecenter reflects the present less-than-half occupancy rate.


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Table 3: FIRR and EIRR of the Project Components(%)

Appraisal PCR PPAR

Component

Share inActualProjectCosta

FIRR EIRR FIRR EIRR FIRR NPVb

EIRR NPV

A. Rubber Development1. Rubber Replanting

10.4 15 15 14 14 16

8,087 16 8,085

2. Rubber Maintenance

9.9 18 19 16 11 25 21,264 21 15,0743.Rubber-Based Product

Factory6.2 15 28 8 8 neg. (172) neg. (150)

4. Presswood Factoryc 5.3 57 67 B. Sugar Development

1. Sugarcane Rehabilitation

5.6 19 26 16 10 neg. (8,204) neg. (6,859)2. Sugar Mill Construction 18.9 13 16 7 8 82 275 neg. (70)3. Sugar Mill Expansion 12.8 16 22 15 16 146 529 36 110

C. Sisal Development1. Sisal Replanting

3.1 17 15 9 16 3 (11,633) 23 12,188

2. Sisal Leaf ProcessingFactory

0.6 13 15 8 20 neg. (19) neg. (14)

3. Sisal Yarn Factory 3.4 23 27 17 33 4 (10) 18 9

D. Forest Tree Development1. Forest Tree Plantation 8.9 17 19 21 22 33 14,565 22 5,7572. Chipwood Factory 0.4 16 27 16 19 neg. (22) neg. (36)3. Plywood Factory

d1.2 33 38 12 12 neg. (42) 4 (25)

E. Marketing and Trading Center 6.1 8 8 neg. (44) neg. (58) = no data available/not calculated, EIRR = economic internal rate of return, FIRR = financial internal rate of return,neg. = negative, NPV = net present value, PCR = project completion report, PPAR = project performance auditreport.Note: Figures in parenthesis are negative.a

Excludes transport company (7.2%).b

CNY per hectare for plantations and CNY million for agroprocessing enterprises.c Closed down.d

Conceptualized as chipwood factory at appraisal; redesigned to produce plywood.Source: Operations Evaluation Mission estimates.

D. Sustainability

39. Rubber replanting and maintenance are expected to be sustainable. At the currenteconomic growth levels, demand for industrial crops such as natural rubber will continue to

increase. Natural rubber can be harvested for at least 25 years, and terminating productionbefore the end of the rubber trees life span would not make sense financially. The PRC agreedto reduce import tariffs on agricultural products from the weighted average of 22.0% to 17.5%.The PRCs statutory tariff binding for natural rubber is currently 15%. After the elimination ofnontariff barriers under the WTO agreement, the de facto tariff rate for rubber is not expected tochange significantly. The rubber-based product factory will be sustainable if the new rubber


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that of competing countries such as Brazil ($4.70/t) and Cuba ($1.80/t),23 Although a suddendomestic price decrease is unlikely, for long-term sustainability the General Bureau shouldreduce costs by (i) reducing subsidies for farmers social welfare, (ii) eliminating farmersguaranteed purchasing price, and (iii) planting other high value-added crops. The sustainabilityprospects for the sugar development component will then improve.

41. The PRC produces over half the sisal leaf in Asia. The PRCs accession to WTO is anadvantage to the General Bureau, and sisal replanting is sustainable. However, the sisal leafprocessing factory is too weak financially to be sustainable in the long term. The sisal yarnfactory is expected to be sustainable because of its new value-added products and improvedprofitability since 2000 (para. 36). Overall, the sustainability of the sisal development component

is likely.

42. Based on the financial rate of returns, the forest tree plantations are financially viable.The plywood factory is expected to be sustainable if it maintains its present profit level from thesales of doors and doorframes (para. 36). The sustainability of the chipwood factory is lesscertain if the chipwood price continues to be weak. Overall, the sustainability of the forest treedevelopment component is likely.

43. The sustainability of the marketing and trading center is less likely because of the lowoccupancy rate and the depressed real estate market (para. 22).

44. Under the attached advisory TA, the Project supported the General Bureaus institutionaldevelopment through training in crop management technology, procurement procedures, andequipment operation and maintenance. Skills acquired through training are used appropriatelyand disseminated within the General Bureau through research and development activities. Theinstitutional development undertaken under the Project is sustainable.


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IV. ACHIEVEMENT OF OTHER DEVELOPMENT IMPACTS

A. Socioeconomic Impact

45. The Project was expected to benefit 25,000 existing farm families under the GeneralBureau and create incremental employment opportunities for 11,400 farmers and 3,200agroprocessing enterprise workers. In addition, the Project was to create marketing and income-generating opportunities to about 22,000 outgrower farm families through village joint-ventureprograms, with extension services provided by the state farm bureaus under the GeneralBureau.

46. At completion, the Project created 12,600 jobs (10,900 on plantations and 1,700 atagroprocessing enterprises), or 86% of the target, of which 6,600 are on the state farms and6,000 for outgrowers. The latter are mostly temporary and seasonal. The job creation wasgenerally gender-neutral: 55% for males and 45% for females.

47. The average per capita income under the General Bureau increased from CNY1,195 in1992 to CNY3,183 in 1999, as income increased in the agriculture sector in Guangdong as awhole, from CNY1,308 in 1992 to CNY3,629 in 1999, or about 70% above inflation.24 The OEMcould not confirm the Projects separate income impact as data on the income level of

outgrower farmers among the project beneficiaries was insufficient. However, the OEMs fieldinquiry confirmed that the income of outgrower farmers in the project area was equivalent to theprovincial average income in 1999.

B. Environmental Impact

48. The Project has no major environmental impact. Rubber effluent, which is producedwhen latex is processed into dry rubber, is treated in a pond at each farm bureaus latex

processing factory. The factories strictly follow the PRC National Environmental Standard.Some farm bureaus use the treated effluent to irrigate sugarcane fields. The agroprocessingenterprises, except for the sisal factories, produce no substantial waste. The sisal factories,which produce liquid and solid waste, have proper waste management and recycling systems;fiber waste is used as fertilizer, and sisal juice is condensed and sold as chemical input.

49. The PCR recommended that the General Bureau reduce the noise and promote workersafety at sisal leaf processing, sisal yarn, and chipwood factories. Apart from providing earplugsto workers, the factories have not taken any additional measures for noise reduction as major

equipment replacement and significant financial commitment would be required. The factoriesconduct annual medical assessments for workers and have found no noise-related healthproblems among them. To increase safety, ear muffs, gloves, and goggles were provided to theworkers at the chipwood factory. However, the rule requiring the wearing of safety gear is notstrictly enforced.


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51. The advisory TA aimed to help the Government develop project-related reform modelsand strengthen the General Bureaus institutional capacity for project implementation. Its pricingand marketing study recommendations were adopted by the General Bureau and helped make

crop and factory management more efficient. The recommendations included (i) introducingquality payment schemes for sugarcane and sugar beet; (ii) establishing a rubber replantingfund; and (iii) establishing marketing and market information systems. The recommendation fora quality payment scheme for sugarcane was adopted by the sugar mills under the Project andprovided incentives to the state farms to produce sugarcane with high sugar content. TheGeneral Bureau is establishing an information network system to provide daily price statistics tofarmers. The General Bureau has been receiving budgetary support for rubber replanting fromthe Ministry of Agriculture but a rubber replanting fund has not yet been established.

52. The Project contributed to the institutional change of the General Bureau by exposing itto commercial operation practices. During implementation, the General Bureau carried outsignificant reforms. Its decision-making authority was decentralized. The farm andagroprocessing enterprises operate independently and are responsible for their profit and loss.For new investment, farm bureaus and enterprises are expected to raise their own resources,either through self-financing or local loans. The General Bureau is forming joint-venturecompanies with foreign investors. Agro-enterprise management is appointed based on merit,not on seniority. The General Bureau promptly replaces enterprise managers if their

performance is not satisfactory. For example, until the General Bureau found the presentqualified factory manager for the rubber-based product factory in 1998, the position was filledfour times during the first 2 years as the managers did not generate net profits. The organizationchart of the General Bureau is in Appendix 5.

53. The General Bureau appreciated and adopted all training programs under the advisoryTA, which provided 55 person-months of training. Project staff training programs are listed in

Appendix 4 of the PCR. All trainees have remained at the General Bureau and work in

production or research. The procurement seminar at ADB in 1994 was perceived as especiallyuseful.

54. The advisory TA made some policy-related recommendations to the Government:25 (i)reform and restructure rubber enterprises to improve product quality and meet market demand;(ii) enforce the rubber import tariff system more effectively; and (iii) rationalize sugar mills.Inefficient sugar mills have been closed in Guangdong. Rubber imports are still subject todistribution by government-licensed trading companies. However, the PRCs accession to WTOwill restrict the effect of the state-designated trading in raising prices of imported commodities

above the level of agreed-upon tariffs (para. 40). Given the Governments ongoing reformpolicies, the reforms that have occurred for the last decade in the rubber and sugar sectorcannot be attributed to the advisory TA alone. However, the TA was relevant to theGovernments agricultural strategy. Its effect on the Governments rubber and sugar sectorpolicy is considered moderate.


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enterprise autonomy through the shareholding system, and (iv) encouragement of competition.The rubber and sugar plantations were supported despite Government import restrictions andtariffs because (i) gradual liberalization and efficiency improvement of the sectors was expected;

(ii) crops under the Project were primarily for the domestic market; and (iii) at the time ofappraisal, international prices of the two crops were predicted to rise, which resulted in highEIRR estimates.26 However, the comparative advantage of the two crops, especially sugar,could have been examined more rigorously. Investing in more competitive crops could havehelped the General Bureau reduce plantation management costs. Overall, the Project isassessed as relevant.

56. Efficacy. The Project achieved most of the operational objectives and, in particular,

increased tropical crop production. The agroprocessing enterprises generally exceededappraisal targets of output capacity. The Projects socioeconomic impact was positive as itcreated jobs for farmers and factory workers. However, the OEM did not find income differencesbetween farm households under and outside the Project. The Project is assessed as efficaciousin achieving its objectives.

57. Efficiency. Based on the total net benefits of the various components, the Project hasan FIRR of 28.4% and an EIRR of 10.3%. The rubber and forest tree plantations achievedFIRRs and EIRRs above 12%. The negative NPV of the sugarcane plantations reflects the high

sugarcane production cost of the General Bureau. Among the seven agroprocessingenterprises, two have FIRRs above 12%, and two have EIRRs above 12%. Overall, the Projectis assessed as efficient.

58. Sustainability. The rubber components will most likely be sustainable. Thesustainability of the sugar components is likely if the General Bureau continues its costreduction efforts for the sugarcane plantation. The General Bureau has comparative advantagein producing sisal, and the PRC is the main exporter of the crop. The sisal plantations are

sustainable. However, the sisal leaf processing and yarn factories should reduce their costs toensure long-term sustainability. The tree plantations are financially viable, but the chipwood andplywood factories are vulnerable to market demand and price changes. The marketing andtrading center has little prospect of recovering its investment cost, and its sustainability is lesslikely. Overall, the sustainability of the Project is assessed as likely.

59. Institutional Development. The training component of the advisory TA contributed tothe skill and institutional development of the General Bureau, helping it meet operationalrequirements following the reforms. The General Bureau is now responsive to market price

signals and continues to reduce costs through labor-saving production, and research anddevelopment. The General Bureau has promoted the reforms by decentralizing managementdecision making and making it more flexible. The expected corporatization of theagroprocessing enterprises was partly achieved. The TA study on rubber and sugar pricingpolicies had a moderate impact on the Governments reform models. Overall, the Projectsinstitutional development impact is rated significant


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E. Overall Project Rating

60. The Projects goal to increase the production efficiency of agriculture andagroprocessing through market reforms was and still is relevant, although the comparativeadvantage analysis for agricultural crops could have been more rigorous. The General Bureaudiligently followed the agreed-upon implementation arrangements and achieved most of thephysical output objectives. The Project as a whole achieved an FIRR of 28.4% and an EIRR of10.3%. While the plantations achieved sufficient rates of return, the agroprocessing enterprisesrates of return were lower due to the inefficient management systems of state-ownedenterprises. Overall, the Project is expected to be sustainable. The General Bureaus further

efforts to restructure its plantation and enterprise management system will enhancesustainability. The General Bureau made laudable efforts to transform itself from a Government-subsidized organization to an independent business enterprise. If the Project had not beenimplemented, this reform would have taken longer. Based on the five evaluation criteria, theProject is rated successful.

G. Assessment of ADB and Borrower Performance

61. The Borrowers performance was satisfactory. The submission of a financial audit

statement was timely and prompt. The major loan covenants were complied with. The Projectwas implemented without any major delay. ADBs performance is also considered satisfactory.

ADBs communication and interaction with the General Bureau was prompt and responsive torequests such as the design change of a chipwood factory. For two reasons, ADBsperformance was short of highly satisfactory. First, although institutional support of trade policywas outside of the project scope, ADB could have been more alert at appraisal in anticipatingthe effect of trade liberalization on the project crops and their comparative advantage.27 Second,the issue of the presswood factory could have been addressed earlier.


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V. ISSUES, LESSONS, AND FOLLOW-UP ACTIONS

A. Key Issues for the Future

62. Incorporation of Agroprocessing Enterprises into Shareholding Companies. TheProjects incorporation of agroprocessing enterprises into shareholding companies to increaseefficiency was ineffective. The Project introduced incorporation and workers shareholdingparticipation as a reform measure. The target level of workers share ownership was notachieved. Incorporation did not lead to increased efficiency because the General Bureau itself isstill under state ownership, and the guaranteed wage system for workers gave no incentives tomanagers and workers to be more productive. Successful incorporation and/or privatization ofstate-owned enterprises requires broader policy framework changes, including the setting up oflegal and regulatory systems, supervising authorities, and information disclosure. State-ownedenterprise reform is an unsolved, ongoing issue because it implies broad social and economicrestructuring, including reform of the social safety net, taxation, and government administration.The Projects approach to incorporation was ambitious and should have been done step bystep, emphasizing making the enterprises more efficient, for example, by spinning off socialwelfare activities unrelated to production to establish financially viable operations.

63. Poverty Impact. While it attempted to reduce poverty by creating jobs and income-generating opportunities for outgrowers, the Project lacked the appropriate instruments andinstitutional arrangements to do so. The village joint ventures were expected to improve incomeand transfer technology to outgrowers through the General Bureau. However, as a commerciallyoriented entity, the General Bureau had little incentive to engage in poverty-focused activities,which have high transaction costs and are not financially justifiable. Agriculture sector incomeswill improve when project executing and/or implementing agencies provide beneficiaries withproductive assets such as land, capital, and new technology. Often, initial investments for suchan activity are not financially viable. A commercial organization such as the General Bureau isnot suited to make such an investment.

64. Investment in Sugar Production. Sugar production in the PRC is inefficient becauseof government protection. The comparative advantage of sugar production was questioned fromthe initial stages of project processing. The basis for approval was that the PRCs ongoingreform would create a more competitive environment for domestic sugar producers. Theadvisory TA was expected to contribute to the commercialization of the General Bureausoperations. The Project increased sugar production. The combined tariff, quota and state

distribution systems keep sugar highly protected. The lack of a cost-efficient analysis ofalternative crops such as fruit meant that the General Bureau missed an opportunity to invest inmore competitive sectors.

B. Lessons Learned


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66. When a project involves commercial operations such as marketing products andservices, a realistic market-demand projection should be prepared as part of the project

preparatory TA to avoid overinvestment (para. 11).

67. For state-owned enterprise restructuring to improve efficiency, the sequence ofmeasures should be thought through. For example, cost recovery should first be achievedbefore incorporation (para. 62).

68. When projects involve poverty reduction interventions, appropriate intermediaries shouldbe selected that have the incentives, capabilities, and resources to carry out such interventions.

ADB should recognize that investment in poverty reduction activities often cannot be justified onthe basis of financial viability and, if an executing and/or implementing agency is a commercialentity, poverty reduction is likely to be sidelined (paras. 29 and 63).

69. ADB should ensure that feasibility studies include adequate comparative advantageanalysis of crops, and a full assessment of the effects of policy changes such as governmentprotection and subsidies, and the related implications for sustainability and financial viability.When price or trade liberalization is anticipated, an appropriate impact analysis should becarried out. ADB-financed projects should pursue liberalization and deregulation of the

agriculture sector and avoid delaying restructuring of inefficient sectors (para. 12).

C. Follow-up Actions

70. The General Bureau, in consultation with the Government, should develop medium-termoperational plans by end2002 to keep the farm and enterprise bureaus financially viable, Theplans should consider (i) restructuring the pension system for retired General Bureau workers;(ii) initiating the revision of social welfare provision under the household responsibility system;

(iii) developing marketing and distribution systems for fruit and other perishable crops; (iv)increasing the proportion of temporary labor; (v) introducing alternative crops or income-generating activities for farmers; and (vi) in the longer term, spinning off noncore, nonprofitablebusiness operations such as hospitals.


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SUMMARY OF ACHIEVEMENT OF OUTPUTS

Component/ItemAppraisal Actual

Output Target Completion TimeTarget Actual Capacity Actual Completion


a. Rubber Replanting Replanting 8,000 hectares(ha) of old rubber with high-yielding varieties

June 1997 8,000 ha of rubber treesreplanted

December 1994

b. Rubber Maintenance Maintaining 7,670 ha ofyoung rubber

December 1996 7,670 ha of rubber treesmaintained

December 1995

c. Rubber-Based Product Factory Setting up a rubber-basedproduct factory with acapacity of 500 tons (t)/year

June 1994(construction)January 1994 (start ofoperation)

a

Factory established andoperating with 450t/yearproduction capacity.

November 1995(construction)January 1997 (start ofoperation)

d. Presswood Factory Expanding an existingpresswood factory toproduce 198,000 flame-retardant doors anddoorframes

June 1994(construction)January 1994 (start ofoperation)

Production line built, butclosed in 1999

December 1996(construction)


a. Sugarcane Rehabilitation Improving the 13,333 ha oflow-yielding sugarcaneplantations

January 1993 (start ofcultivation)

10,000 ha of sugarcanerehabilitated and 3,000ha of sugarcane planted

January 1992 (start ofcultivation)

b. Sugar Mill Construction Building a new 2,000 t/dayfactory

July 1994 (construction)January 1994 (start ofoperation)

Factory built andoperating with 4,000t/day processing

capacity

November 1994(construction)January 1995 (start of

operation)

c. Sugar Mill Expansion Increasing the daily capacityof an existing sugar mill from3,500 t/day to 6,000 t/day ofsugarcane

June 1994 (millexpansion)January 1994 (start ofoperation)

Factory capacity wasincreased to 6,500 t/dayof sugarcane

November 1994(expansion of productionline)October 1993 (start ofoperation)

aProduction line started operating before the full completion of construction.

Source: Operations Evaluation Mission.

Appendix1


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Continued

Appraisal ActualComponent/Item

Output Target Completion Time

Target

Actual Output Actual Completion


a. Sisal Replanting Replanting 2,670 ha ofsisal

July 1997 2,700 ha of sisal werereplanted

December 1994

b. Sisal Leaf Processing Factory Building a leaf processingline with daily processing

capacity of 250 t

December 1993(construction)

January 1993 (start ofoperation)

Factory built andoperating with capacity

of 1,600 t/day

July 1995 (construction)November 1995 (start of

operation)

c. Sisal Yarn Factory Building a sisal yarnprocessing line to increaseproduction capacity from1,200 to 2,000 t/year

June 1993 (construction)January 1993 (start ofoperation)

Factory built andoperating with 3,800t/year productioncapacity

December 1994(construction)January 1996 (start ofoperation)

4. Forest Development

a. Forest Tree Plantation Planting 7,670 ha ofwindbreak forests andindustrial tree plantations

August 1997 7,667 ha of forestplantations completed;4,000 ha of forestplantations destroyedby 1995 typhoon

December 1994

b. Chipwood Factory Expanding an existingchipwood factory

December 1992(expansion)January 1993 (start ofoperation)

Production lineexpanded and operatingwith processingcapacity of 45,000t/year

December 1993(expansion)January 1994 (start ofoperation)

c. Plywood Factory Building a chipwood factorywith a capacity of 30,000 t

July 1993 (construction)March 1995 (start ofoperation)

Factory redesigned toproduce plywood;produces 50,000 doorand doorframes/year

December 1995(construction)July 1996 (start ofoperation)

5. Marketing and Trading Center Building a marketing andtrading center

June 1994 (construction)July 1994 (start ofoperation)

24,000 m2

center builtand rented as officespace

March 1998(construction)October 1997

Appendix1

Appendix 2


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Appendix 2

Item

I. Rubber Development 9.9 26.3 36.2 8.4 32.1 40.6

A. Rubber Replanting 2.7 11.3 14.0 1.6 11.7 13.3B. Rubber Maintenance 2.5 7.9 10.3 1.5 11.1 12.6C. Rubber Products Factory 2.8 2.7 5.5 3.1 4.9 7.9D. Presswood Factory 2.0 4.5 6.4 2.3 4.5 6.8

II. Sugar Development 18.8 16.2 35.0 17.8 29.7 47.4

A. Sugarcane Rehabilitation 2.5 3.2 5.6 1.4 5.7 7.1B. Sugar Mill Construction 8.0 6.7 14.6 8.2 15.8 24.0C. Sugar Mill Expansion 8.3 6.4 14.7 8.1 8.1 16.3

III. Sisal Development 5.8 6.0 11.8 4.8 4.3 9.0

A. Sisal Replanting 2.3 4.4 6.7 1.3 2.7 3.9B. Sisal Leaf Processing Factory 0.6 0.3 0.9 0.5 0.3 0.8

C. Fine Yarn Processing Factory 3.0 1.2 4.2 3.0 1.3 4.3

IV. Forest Development 3.3 4.2 7.5 2.4 11.0 13.3

A. Industrial Tree Plantation 2.2 3.6 5.8 1.4 9.9 11.3B. Chipwood Factory 0.4 0.3 0.7 0.3 0.2 0.5C. Tongluohu Plywood 0.6 0.4 1.0 0.7 0.9 1.5

V. Marketing and Trading Center 2.1 1.1 3.2 2.3 5.5 7.8

VI. Equipment and Vehicles 3.4 0.8 4.2 7.9 1.3 9.1

VII. Consulting Services/Training 0.2 0.0 0.2 0.0 0.0 0.0

Interest During Construction 11.5 0.0 11.5 12.4 0.0 12.4

Total 55.0 54.7 109.7 55.9 83.8 139.7

PROJECT COST

($ million)

Foreign

Exchange

Local

Currency Total

Foreign

Exchange

Local

Currency Total

Appraisal Actual

Appendix 3


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Appendix 3

SUMMARY OF THE GENERAL BUREAUS FINANCIAL STATEMENTS

(CNY million)

Item 1995 1996

1998 1999

Gross Sales Revenue 1,217.0 1,287.2

1,440.6 1,384.1

Tax 159.5 140.7 133.6 135.4Net Profit 235.2 100.0 45.2 (393.0)Gross Fixed Assets 2,133.2 3,233.5 3,872.2 4,009.8

Net Fixed Assets 1,684.5 2,395.2 2,803.4 2,819.9Fixed Assets Investment 741.6 581.9 436.9 358.2

Note: Comparable data was not available for 2000 and 2001 at the time of the Operations Evaluation Mission.

Source: Rural Statistical Yearbook of Guangdong. 2000.


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Appendix 4

PROJECT ECONOMIC ANALYSIS

A. Methodology and Assumptions

1. The methodology used in the Projects economic analysis follows Guidelines for theEconomic Analysis of Projects of the Asian Development Bank (ADB). The economic internalrate of return (EIRR) is estimated by project component: (i) rubber replanting, (ii) rubbermaintenance, (iii) rubber-based product factory, (iv) sugar rehabilitation, (v) sugar millexpansion, (vi) sugar mill construction, (vii) sisal replanting, (viii) sisal leaf processing factoryconstruction, (ix) sisal yarn factory construction, (x) forest tree plantation, (xi) chipwood factoryexpansion, (xii) plywood factory, and (xiii) marketing and trading center. The major assumptions

underlying EIRR estimation follow:

(i) The economic analysis covered 30 years (19922021). For the rubber-basedproduct, sisal yarn, and plywood factories, the period was shortened due to thedelay in their operations.

(ii) All calculations of project economic benefits and costs were expressed inconstant 2001 prices. Project investments were adjusted using the World BanksJanuary 2001 manufacturers unit value index for foreign exchange items. Local

benefits and costs were adjusted to reflect the 2001 prices using gross domesticproduct deflator (Table A4.1).

(iii) Economic prices of internationally traded commodities such as sugar and rubberwere derived from the World Banks commodity prices and price projections.1The border prices for main outputs are computed on the basis that sugar andrubber are not incremental outputs and that sisal and chipwood are. Thecalculations of farm-gate economic prices are in Table A4.2.

(iv) All economic values were estimated using domestic price numeraire. A shadowexchange rate factor of 1.08 was used to adjust traded goods and internationalcost components of the Project to economic costs and benefits. The conversionfactor for unskilled labor was 0.75.

(v) Project investment costs used in the economic analysis include the actual costsof civil works construction, equipment, and other inputs. The investment costsincluded in the economic analysis are exclusive of transfer payments such as

duties and taxes.

A. Estimation of Project Benefits

2. Only direct economic benefits were included in estimating the EIRR. These were the netincremental economic benefits derived from a comparison between the with Project and


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Appendix 4


3. In the appraisal report, the FIRR and EIRR of the rubber replanting component were

calculated as 15.5% and 15.1%, respectively. The appraisal estimates were based on the WorldBank commodity price projections for 19952009. The World Bank expected the natural rubberprices to rise from $1,060/ton (t) in 1990 to $1,380/t in 1995-2000, but the price of natural rubberdeclined by 42% in 19902001. The price projection of natural dry rubber for the FIRR andEIRR of the Project Performance Audit Report (PPAR) (Tables A4.4A4.6) is based on theWorld Bank commodity price projection, which predicts that real prices will increase 16% by2015 relative to 2001. The state purchase and Governments budgetary support for rubberproducers were abolished in 1992. However, natural rubber is still imported from only a few

countries under the barter trade agreement and controlled by licensed foreign tradecorporations. Thus, the effective tariff rate of natural rubber is higher than the presentpreferential tariff rate of 15%.


4. The appraisal report estimated the FIRR for sugar rehabilitation as 18.6%, and the EIRRas 26.2%, based on the World Bank commodity price projections. The World Bank predicted thesugar price would increase from $283/ton (t) in 1990 to $300/t in 2005 in constant 1991 price.

During the Project, the international sugar price declined from $288.00/t in 1990 to $194.50/t inconstant 2001 price. For the PPAR FIRR and EIRR (Tables A4.7A4.10), the price projection ofsugar for 2002 onward is based on the World Bank commodity price projection, which predictsthat sugar prices will increase 12% in 2003 relative to 2002, and remain low for the next severalyears. With sugar trade and distribution handled by licensed foreign trade corporations, andimport tariffs, the Peoples Republic of China (PRC) has kept the domestic sugar price at almosttwice the international price. However, during the Project, the PRC was flooded with smuggledsugar from Viet Nam, and the domestic sugar price declined to close to the international level.

Because the Government has recently controlled smuggling, the domestic sugar price rose toaround $500/t in 2000-2001.


5. At appraisal, the international price of sisal was not available. The appraisal reportestimated the price based on that in 19801989, when sisal was on average 70% moreexpensive than jute fiber. For the PPAR, the international price of sisal leaf was obtained fromWorld Bank commodity price data (Tables A4.11A4.13).

B. Sensitivity Analysis

6. Sensitivity analysis was conducted at PPAR by the project components which havepositive net present value (NPV). Because of the large price fluctuations of rubber and sugarduring the Project, the rates of return of the rubber replanting, rubber maintenance, sugar mill


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Appendix 4

Year

1992 5.51 1.50 351.4 44.3 106.64 98.01

1993 5.76 1.44 398.8 50.3 106.33 97.73

1994 8.62 0.96 449.3 56.7 110.21 101.30

1995 8.35 0.99 496.5 62.6 119.21 109.57

1996 8.31 1.00 544.1 68.6 113.99 104.77

1997 8.30 1.00 592.2 74.7 108.38 99.61

1998 8.28 1.00 638.5 80.5 104.19 95.76

1999 8.28 1.00 684.1 86.3 103.56 95.18

2000 8.28 1.00 738.8 93.2 106.15 97.56

2001 8.28a

1.00 792.7 100.0b

108.80 100.00

GDP = gross domestic product, MUV = manufactures' unit value.a

The 2001 exchange rate is the average from January-November 2001.b

The 2001 price index is an estimate from 1998/1999 and 1999/2000 indixes.

Source: Operations Evaluation Mission estimates.

Table A4.1: Assumptions Used in Calculating Project Costs

Annual

Average

Exchange

Rate

(CNY:$1)

Exchange

Rate Ratio:

2001 to

Current

Year

GDP Implicit Price Index MUV Index

(1978=100) (2001=100) (1990=100) (2001 = 100)


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C. Import Parity for Sisal a

Item 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2005 2010 2015

$/mt 594 596 612 574 668 793 857 727 572 632 705 710 720 730 740

FOB prices, Guangzhou, $ 594 596 612 574 668 793 857 727 572 632 705 710 720 730 740

Shadow exchange rate

($=CNY8.94)

FOB prices, Guangzhou, CNY 5,309 5,324 5,472 5,132 5,973 7,090 7,663 6,495 5,116 5,648 6,303 6,347 6,437 6,526 6,616

Processing (-) 51 51 51 51 51 51 51 51 51 51 51 51 51 51 51Transport and handling (-) 153 153 153 153 153 153 153 153 153 153 153 153 153 153 153

Financial Price b 8,126 7,157 6,173 5,591 5,394 4,953 4,969 4,635 4,721 4,400 4,400 3,900 4,000 4,100 4,200

Economic Price b 5,105 5,120 5,268 4,928 5,769 6,886 7,459 6,291 4,912 5,444 6,099 6,143 6,233 6,322 6,412

Note: The PRC is a net importer of sisal.

Sisal: East African, CIF UK.a Sisal: long fiber, first grade.

Sources: World Bank Commodity Price Data (Pink Sheet, various issues) and Global Commodity Price Prospects (January 2002).

b Financial and economic prices: 1992-2001 actual; projections for 2002 onwards are based on World Bank projection that price of agricultural raw material will rise by 17% by 2015 relative to 2001.

Appen

dix4


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D. Phosphate a

Item 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2005 2010 2015

$/ton 41 41 40 38 40 42 47 47 46 45 42 42 40 40 39Bulk freight and handling (+) 26 26 26 26 26 26 26 26 26 26 26 26 26 26 26CIF price, Guangzhou, $ 67 67 66 64 66 68 73 73 72 71 68 68 66 66 65

CIF prices, Guangzhou, CNY 602 603 590 575 591 609 652 654 644 634 611 604 594 591 580Port handling and margin (+) 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71Local transport (+) 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31Retail price (CNY/ton)Financialb 839 739 656 616 562 516 512 478 442 412 389 382 371 368 357

Economicb 704 705 692 677 693 711 754 756 746 736 713 706 696 693 682


Note: The PRC is a net importer of phosphate.a Phosphate rock (Moroccan) 70% BPL.

Appendix4

Shadow exchange rate ($ =CNY8.94)

b Financial and economic prices: 1992-2001 actual; projections for 2002 onwards are based on the World Bank Global Commodity Price Prospects (January 2002).


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A di 4


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Appendix 4

Year

1992 3,098 0 (3,098) 2,691 0 (2,691)

1993 3,387 0 (3,387) 2,974 0 (2,974)

1994 3,309 0 (3,309) 2,959 0 (2,959)

1995 3,349 0 (3,349) 3,010 0 (3,010)

1996 3,291 0 (3,291) 3,030 0 (3,030)

1997 3,230 12,048 8,818 3,045 6,194 3,1491998 3,191 8,216 5,025 3,065 6,067 3,003

1999 3,732 8,132 4,399 3,650 5,839 2,189

2000 6,354 8,466 2,112 5,976 6,931 955

2001 6,639 9,587 2,948 6,282 8,261 1,979

2002 6,919 11,257 4,338 6,561 9,959 3,398

2003 7,157 13,645 6,488 6,798 11,804 5,006

2004 7,387 15,726 8,340 7,030 14,013 6,983

2005 7,540 17,570 10,029 7,184 15,661 8,477

2006 7,697 18,463 10,767 7,340 16,486 9,145

2007 7,952 20,335 12,383 7,596 18,134 10,5392008 7,952 23,129 15,177 7,596 20,607 13,011

2009 7,952 23,044 15,092 7,596 20,607 13,011

2010 7,933 23,044 15,111 7,572 22,900 15,328

2011 7,933 23,044 15,111 7,572 22,900 15,328

2012 7,919 22,094 14,175 7,558 21,984 14,426

2013 7,919 21,172 13,254 7,558 21,068 13,510

2014 7,933 18,351 10,418 7,572 18,320 10,748

2015 7,917 16,535 8,619 7,552 17,098 9,546

2016 7,917 14,692 6,775 7,552 15,198 7,646

2017 7,917 12,848 4,932 7,552 13,299 5,7462018 7,917 10,055 2,138 7,552 10,449 2,897

2019 7,903 8,240 337 7,538 8,549 1,011

2020 7,903 7,821 (82) 7,538 8,074 536

2021 7,903 7,360 (543) 7,538 7,599 61

FIRR = 24.5% EIRR = 20.8%

NPV = 21,264 NPV = 15,074

EIRR = economic internal rate of return; FIRR = financial internal rate of return; NPV = net present value.

Note: The economic price of rubber is based on the international dry rubber RSSI (Malaysia) less 5% for quality adjustment.a

The rubber maintenance subcomponent involves an additional application of chemical fertilizers.b

Cost items for operation and maintenance include labor, chemical fertilizer, organic fertilizer, stimulant, pesticide, tools and

facility, transportation and equipment, and management.c

FIRR net benefit is net of sales and production tax (10%).


Table A4.5: Estimates of FIRR & EIRR Rubber Maintenancea

(CNY/hectare)

Benefit Net Benefit

Financial Net Benefits Economic Net Benefits

Costb

Benefit Net Benefitc

Costb


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Year

1992 37 37 0 (37) 38 38 0 (38)

1993 9 9 0 (9) 9 9 0 (9)

1994 17 17 0 (17) 17 17 0 (17)

1995 17 17 0 (17) 17 17 0 (17)

1996 36 36 0 (36) 35 35 0 (35)1997 36 36 7 (29) 35 35 9 (26)

1998 36 36 25 (10) 35 35 32 (3)

1999 36 36 9 (27) 35 35 11 (24)

2000 36 36 12 (24) 35 35 15 (20)

2001 36 36 18 (18) 35 35 23 (13)

2002 36 36 18 (18) 35 35 23 (13)

2003 36 36 18 (18) 35 35 23 (13)

2004 36 36 18 (18) 35 35 23 (13)

2005 36 36 18 (18) 35 35 23 (13)

2006 36 36 18 (18) 35 35 23 (13)2007 36 36 18 (18) 35 35 23 (13)

2008 36 36 18 (18) 35 35 23 (13)

2009 36 36 18 (18) 35 35 23 (13)

2010 36 36 18 (18) 35 35 23 (13)

2011 36 36 18 (18) 35 35 23 (13)

2012 36 36 18 (18) 35 35 23 (13)

2013 36 36 18 (18) 35 35 23 (13)

2014 36 36 18 (18) 35 35 23 (13)

2015 36 36 18 (18) 35 35 23 (13)

2016 36 36 18 (18) 35 35 23 (13)2017 36 36 18 (18) 35 35 23 (13)

2018 36 36 18 (18) 35 35 23 (13)

2019 36 36 18 (18) 35 35 23 (13)

2020 36 36 18 (18) 35 35 23 (13)

2021 36 36 18 (18) 35 35 23 (13)

undefined

(172)

EIRR = economic internal rate of return, FIRR = financial internal rate of return, NPV = net present value.a

Cost items for construction and development include building and equipment (foreign and local).bCost items for operation and maintenance include raw materials, fuel and power, labor, maintenance, and waste treatment.


Table A4.6: Estimates of FIRR & EIRR Rubber-Based Product Factory(CNY million)

CostsNet Financial Benefits CostsNet Economic Benefits

Construction &

Developmenta

Benefit

Operation &

Maintenanceb

Net BenefitTotal

Construction &

Developmenta

Benefit Net Benefit

Operation &

Maintenanceb

Total

NPV =

EIRR =

NPV = (150)

Appendix4

undefinedFIRR =

ApTable A4.7: Costs and Benefits of Sugarcane Rehabilitation


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Financial Economic

Item Unit Quantity Cost Quantity Cost

A. With ProjectCost

Labor manday 11.7 300 3,510 8.8 300 2,634 210 2,457 210 1,844

Planting material ton 315.0 7 2,126 315.0 7 2,126 2 473 2 473

Plastic cover kg 16.9 40 676 16.9 40 676 0 0 0 0

Urea kg 1.1 705 790 1.2 705 825 705 790 705 825

Triple superphosphate kg 0.6 1,500 840 0.6 1,500 915 1,125 630 1,125 686

Muriate of potash kg 1.3 600 774 1.4 600 834 600 774 600 834

Organic manure ton 45.1 30 1,353 45.1 30 1,353 0 0 0 0

Transport 0.0 0 845 0.0 0 845 0 0 0 0

Mechanical operation 5.5 180 990 5.5 180 990 50 275 50 275Management fee 0.0 0 1,543 0.0 0 1,543 0 0 0 0

Common production cost 0.0 0 1,029 0.0 0 1,029 0 0 0 0

Total cost 14,475 13,770 5,398 4,936

Gross returns (yield x price) 20,090 21,044 20,090 21,044

Net return 5,614 7,274 14,692 16,107

B. Without Project

Cost 2 473 2 473

Labor 11.7 270 3,159 8.8 270 2,371 0 0 0 0Planting material 315.0 7 2,126 315.0 7 2,126 525 588 525 614

Plastic cover 0.0 0 0 0.0 0 0 750 420 750 458

Urea 1.1 525 588 1.2 525 614 350 452 350 487

Triple superphosphate 0.6 1,125 630 0.6 1,125 686 0 0 0 0

Muriate of potash 1.3 450 581 1.4 450 626 0 0 0 0

Organic manure 45.1 15 677 45.1 15 677 50 275 50 275

Transport 0.0 0 845 0.0 0 845 0 0 0 0

Mechanical operation 5.5 180 990 5.5 180 990 0 0 0 0

Management fee 0.0 0 1,390 0.0 0 1,390 4,313 3,886

Common production cost 0.0 0 924 0.0 0 924Total cost 11,909 11,248 17,846 18,654

Gross returns (yield x price) 17,846 18,654 13,533 14,768

Net return 5,937 7,406 1,159 1,340

Incremental net return (323) (132)

Notes:

1. Sugarcane yield with project: 2001 actual, 94 tons/hectare (t/ha). Sugarcane yield without project: 1990 baseline, 83.5 t/ha. Sugarcane is considered a nontradable and incremental output.

To estimate the consumers' willingness to pay, the average price between the General Bureau's purchase price from the bureau farmers and that from the outgrowers was taken.

2. Unlike other major cane-growing areas such as Australia and Hawaii, the practice in the project area is to maintain only one ratoon crop. The General Bureau replants after the first ratoon

because subsequent ratoon crops suffer from drastic decline in yield.


Financial Economic

Quantity Cost

ppendix4

(CNY/hectare)

Unit Price Quantity Cost Unit Price

Table A4 8: Estimates of FIRR & EIRR Sugarcane Rehabilitation


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Year

1992 11,432 11,432 0 (11,432) 11,432 11,432 0 (11,432)

1993 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)

1994 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

1995 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)

1996 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

1997 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)

1998 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

1999 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)2000 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

2001 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)

2002 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

2003 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)

2004 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

2005 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)

2006 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

2007 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)

2008 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

2009 2,694 2,694 2,244 (450) 2,648 2,648 2,390 (258)

2010 1,139 1,139 2,244 1,105 1,103 1,103 2,390 1,287

2011 2,694 2,694 2,244 (450) 2