IFAD signs loan to help develop cashew plantation
JAKARTA (JP): The government and the Rome-based International Fund for Agricultural Development (IFAD) signed a loan agreement yesterday providing US$26.01 million in aid to help finance cashew plantations for small landholders in eastern provinces.
The agreement was signed here by IFAD president Fawzi al- Sultan and Director General for Budgetary Affairs Darsjah.
Jeremy G.L. Wall, IFAD's project controller for the Asia division, told reporters that the fund, the eighth aid package given by the organization to develop such projects in the country, will mature in 20 years, including a five-year grace period, and carry four percent interest per annum.
He said the government will contribute $12.96 million and the United Nations Development Program an additional $0.99 million for the project, which will cost $43.16 million.
"We expect that the project, which will introduce cashew planting in ergonomically suitable areas, will help increase incomes as well as improve the nutritional status of some 52,000 poor farm families," he said.
A Ministry of Agriculture report said that the project will include the development of small cashew plantations in four regencies in East Nusa Tenggara, five regencies in West Nusa Tenggara and one regency in Maluku.
"In addition to the plantations, IFAD will provide technical assistance to help improve food crop production," Wall said.
He expects the project to double Indonesia's current cashew production to some 35,000 tons a year, of which 70 percent will be exported.
Infrastructure
Suharyo Husen, head of the bureau for international affairs of the Ministry of Agriculture, said that besides technical assistance for 5,525 farmers on 506 farms, the funds will also be used to develop infrastructures, including water supply, well- digging activities and inter-town roads.
"We also expect to set up several centers for agricultural studies in East and West Nusa Tenggara," he added.
Al-Sultan said that IFAD is now negotiating with the Indonesian government on new funds for livestock projects and the piping system in Sulawesi and Ambon.
Wall told The Jakarta Post that IFAD will provide $25 million to $50 million for the two projects.
IFAD, which is one of the members of the Consultative Group for Indonesia chaired by the World Bank, has thus far financed eight smallholder and transmigration resettlement projects in the country with total aid of $177 million. (fhp)