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| Loan Name | Forestry and Ecological Restoration in Three Northwest Provinces Project (former names: (i) Ecosystem Restoration in Three Northwest Provinces (ii) Silk Road Ecosystem Restoration | |||
| Country | China,People'sRep.of | |||
| Project Number | 40684- 01 | |||
| Fund Source/Amount[Proposed] |
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| Thematic Classification |
Environmental Sustainability
Social Development |
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| Project Rationale | The poverty incidences in Gansu, Shaanxi, and Xinjiang provinces are ranked in the poorest categories in the People's Republic of China (PRC). The poverty incidence of Gansu is about 19.4% higher than the national average of about 5.15%, while the poverty incidences of Shaanxi and Xinjiang are both about 14%, also significantly higher than the national average. Rural inhabitants in the project area are even poorer than the provincial averages. The Project will respond to policy failures related to forest land tenure that have resulted in resources being allocated to low-value, non-sustainable land uses causing a loss of forest and tree crops benefits, and disadvantaged socio-economic conditions. These conditions have resulted in higher poverty and non-viable organizations responsible for managing the high-priority ecological assets in natural forests and critical watersheds for urban water supplies. These policy failures have also created externalities in terms of underdelivery of public goods in the form of soil and water protection.
Forest land is typically of three types in the PRC: (i) ecological or natural forests, (ii) timber plantations, and (iii) economic trees comprising fruit and nut orchards. In the project area, the focus is on ecological forests and economic trees. Degraded ecological forests are in need of restoration with improved forest density and forest cover. Ecological forests provide important environmental and biodiversity benefits, and help mitigate adverse climate changes. Forest land currently being cultivated and cropped annually, usually with wheat and maize, degrades through loss of soil qualities such as organic matter and carbon, and water holding capacity. The excessive use of fertilizer leads to water pollution, additional use of agrochemicals results in health and environmental threats, and high levels of irrigation cause depleted water resources. In addition, producers on these lands are increasingly living in below-average socio-economic conditions and lag further behind urban dwellers and more productive rural producers. The high proportion of forest land in most rural regions combined with inappropriate low-value use is a significant constraint on the Government's rural development objectives. For example, Shaanxi's collective forest land totals about 130 million mu (land measurement in the PRC) and while all this is not cultivated, it represents about 42% of the total provincial land area. Gansu has about 60 million mu of collective forest land, which is about 25% of the total cultivated land area. The Project's strategies are to support the implementation of recent collective forest tenure reforms and assist land contract holders to convert their land and labor resources into higher-value and more sustainable tree crops production systems. These changes seek to capture additional ecological benefits from reduced soil degradation, improved soil organic matter, and soil carbon leading to increased water percolation and holding capacity. Economic and social benefits relate to significantly higher returns to land and labor, and reduced agricultural demand for household labor. Land that is ecologically sensitive, degraded, or barren will be secured through tree planting to reduce the risk and scale of erosion, sand intrusion, and off-site effects that arise from these, and institutional strengthening for the transitioning of state forest farms into effective ecological resource management units using public-private partnerships. |
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| Impact | The expected impact of the Project will be the restoration of forest lands in Gansu, Shaanxi, and Xinjiang provinces, and improved incomes and sustainable livelihoods from the use of forest land through adoption of appropriate technologies and practices. | |||
| Outcome | The outcome of the Project will be increased productivity of forest lands and reduced land degradation in Gansu, Shaanxi, and Xinjiang provinces through appropriate and sustainable land use. | |||
| Outputs | The components include (i) economic tree crops development on about 38,400 ha, (ii) ecological forestry development on about 303,000 ha, and (iii) project management support for both local government implementation and farm households. | |||
| Geographical Location | Gansu, Shaanxi, and Xinjiang provinces | |||
Safeguard Categories
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| Environment | B | |||
| Resettlement | C | |||
| Indigenous People | A | |||
| Summary of Environmental and Social Issues | ||||
| Social Aspects |
The Project will facilitate farmers' access to markets and higher prices and rural labor to move into off-farm employment, obtain higher-income opportunities, and build capacity to exit poverty. The key project design feature builds on the findings of a recent ADB evaluation of poverty exit achievements, which highlighted the success from linking the rural poor to commercial value-adding enterprises, and the associated off-farm employment opportunities. The project design uses similar contract farming, processing, and alternative livelihoods through links with enterprises, which will provide credit, farming support services, and technical training. The interventions will result in productivity improvements and greater market certainty leading to increased incomes. Adoption of appropriate technologies, land use matched to soil capability, improved water use and nutrient efficiency, strengthened farmer associations, access to rural finance, contract farming agreements linked to processing and market chains, and capacity development will all contribute to improved sustainable livelihoods and resilience for poor rural households.
The ethnic minority development plan indicates that no ethnic groups are involved in the project areas of Gansu and Shaanxi, but that ethnic minority groups were found in all five project counties of Xinjiang. The percentage of the minority populations were found to be 26% in Changji county, 29% in Hami and Korle counties, 46% in Hejing county, and 56% in Yanji county. The minority groups include Hui, Kazakh, Mongolian, Tatar, Uygur, and Uzbek. Ethnic minority communities will have equal opportunity to participate in the Project. In a community that has a small number of ethnic minority people and large number of Han people, priority should be given to the minority households. To ensure the participation and benefit of the ethnic minority people, ethnic minority households in the project villages will be invited to the stakeholder consultation and village project designing and planning meetings. In order to identify the special cultural and livelihood features and requirements for project support, special ethnic minority household groups will be consulted. To enable the participation of ethnic minority people, consultation workshops, village project information publicity, and invitation and mobilization of the households will be carried out by IAs, enterprises, and CFBs in ethnic minority languages. |
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| Environmental Aspects | The Project is expected to achieve significant environmental benefits, including (i) water savings, (ii) reduced use of agrochemicals (fertilizers and pesticides), (iii) reduced soil erosion, and (iv) increased carbon sequestration both in trees and soils. Carbon sequestration, even if not monetized, is still considered as a significant benefit representative for the overall direct and indirect positive impacts of the Project. The Project will also enable participating farmers and beneficiaries to better adapt to climate change impacts by introducing sustainable land and management policies. It is expected that possible adverse environmental impacts will be prevented or minimized to an acceptable level if adequate environmental management plans are effectively implemented. For example, groundwater usage is a serious concern in the areas where overexploitation of the aquifers already takes place. It is understood that in those areas no new wells will be drilled for economic tree crops activities. For the start-up of some ecological forestry activities the drilling of some additional new wells has been proposed. | |||
| Stakeholder Participation and Consultation | ||||
| During Project Design | The local governments and project preparatory TA (PPTA) consultants conducted workshops, questionnaire surveys, and interviews to collect views and concerns from the State Forestry Administration (SFA, the executing agency [EA]), the participating provinces, enterprises, and potential beneficiaries. During the preparation of the initial environmental examination (IEE), the local governments, enterprises, and PPTA consultants also held consultations with local farmers on the concerns over the proposed Project. | |||
| During Project Implementation | Public consultation and participation of IAs, households, enterprises, SFFs, CFBs, FS, and other stakeholders, which have been key elements of the project design, will continue during the project implementation to (i) meet the evolving needs and expectations of the beneficiaries, (ii) increase public awareness about the benefits of the Project, and (iii) encourage active involvement of local communities and enterprises to maximize their support for the Project. Stakeholder participation and consultation will be carried out during the preparation of environmental and social reports, project impacts and benefit assessments, and the Government's and ADB's review missions. Participating enterprises, local farmers, and local government agencies will be invited to the consultations. | |||
| Procurement | ||||
| Consulting Services | No consulting services are provided under the loan since the EA, PPMOs, CPMOs, IAs, and beneficiaries have sufficient capacity to implement and manage the Project. However, GEF and possible other grant funds (e.g., Climate Change Fund [CCF] and Gender and Development Cooperation Fund [GDCF]) will provide consulting services for the needed support for grant subcomponent implementation. This will be further investigated and discussed during loan fact-finding. | |||
| Civil Works/Goods | All procurement of goods and works will be carried out in accordance with ADB's Procurement Guidelines (2007, as amended from time to time). The PPMOs and CPMOs will prepare draft procurement plans covering contract packages for implementation during the first 18 months of the Project. The procurement plan, a core appendix to the report and recommendation of the President, will be finalized during loan fact-finding and updated during appraisal, and at least once a year during project implementation. | |||
| Responsible ADB Officer |
Raymond Z. H. Renfro |
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| Responsible ADB Department |
East Asia Department |
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| Responsible ADB Division |
Agriculture, Environment, and Natural Resources Div, EARD |
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| Executing Agencies |
State Forestry Administration |
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| Timetable | ||||
| Concept Clearance | 04 Jun 2009 | |||
| Fact-finding | 04 Jun 2009 to 16 Jun 2009 | |||
| Appraisal | 25 Jan 2010 to 30 Jan 2010 | |||
| Board Approval | 22 Apr 2010 | |||
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