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ADB Administering GEF-Backed Project To Combat Land Degradation In Western PRC

MANILA, PHILIPPINES (29 June 2004) - The Asian Development Bank (ADB) is administering a US$13.8 million project partly funded by the Global Environment Facility (GEF) to help combat land degradation in six priority provinces and autonomous regions of the impoverished western region of the People's Republic of China's (PRC).

The western region, comprising 12 provinces and autonomous regions, supports a population of more than 285 million, including many of the country's poorest and most vulnerable people and is very ethnically diverse. There is a strong correlation between poverty and land degradation.

The country faces some of the world's most serious land degradation problems, with more than 40% of its land area increasingly affected by wind erosion, salinization, and desertification.

Human activities are accelerating the problem, which has profound social and economic consequences, including lower household incomes and increased poverty in many rural communities, higher unemployment rates, and higher migration rates.

The degradation is also threatening biodiversity in a region rich in endemic species and is a major source of dust storms that affect not only the north and northwest of the PRC, but also Japan and the Republic of Korea.

The project, which will strengthen institutions, government agencies and develop a participatory, scientific and comprehensive approach to dealing with land degradation, is the first step in a $1.5 billion 10-year program to 2012 under a GEF-PRC Partnership on Land Degradation in Dryland Ecosystems. The Partnership was designed with ADB assistance and was approved by the GEF Council in October 2002.

GEF plans to provide about $150 million in grant assistance for the Partnership program, which will combat land degradation, reduce poverty, and conserve biodiversity through capacity building investments and developing a series of model investment projects.

For the first ADB project in this series, Capacity Building to Combat Land Degradation, GEF is providing a grant of $7.7 million. ADB is providing a technical assistance grant of US$1 million to complement the project work, strengthen interagency coordination, and monitor and evaluate the project and the overall program. The Government will finance a total package of about $6.3 million, of which $3.3 million will be in cash.

The project will work at the central level and in the six provinces and/or autonomous regions with the worst dryland degradation in the country - Gansu, Inner Mongolia, Ningxia Hui, Qinghai, Shaanxi, and Xinjiang Uygur with a combined population of 117 million - to address integrated ecosystem management of drylands. It will boost institutional capacity, improve the quality of the policy and regulatory environment, planning mechanisms, project design capacity, and monitoring and evaluation skills.

"This preliminary work will ensure that the investments planned under the Partnership have the maximum impact on the poor rural communities and diverse ethnic minority groups that are most affected by land degradation," says Bruce Carrad, a Principal Project Specialist at ADB's Resident Mission in the PRC.

GEF provides grants and concessionary resources for projects that address global environmental issues in the focal areas of climate change, biodiversity, international waters, ozone depletion, land degradation, and persistent organic pollutants.

This is the first project under which ADB has direct access to GEF project resources, under a revised Memorandum of Understanding with GEF approved by ADB last week. This new access now allows ADB to identify, prepare, appraise and undertake GEF projects, receive project financing directly from the GEF Trustee, and be directly accountable for the use of funds. It is also ADB's first "hybrid" project: financed totally by grants but prepared and administered through loan procedures that provide for more intensive preparation, supervision and responsibility by Government.

ADB is dedicated to reducing poverty in the Asia and Pacific region through pro-poor sustainable economic growth, social development, and good governance. Established in 1966, it is owned by 63 members - 45 from the region. In 2003, it approved loans and technical assistance amounting to US$6.1 billion and US$177 million, respectively.

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