China, People's Republic of: Shaanxi Qinling Biodiversity Conservation and Demonstration Project

Sovereign Project | 39321-013

Summary

The Qinling Mountains are an internationally important biodiversity hot spot and represent about 70% of the PRC's biodiversity, including an estimated 300 giant pandas. The Qinling Mountains are central to soil and water management of the Yangtze and Yellow rivers. The Project will improve biodiversity conservation and management by restoring forest habitat, improving endangered species management and providing sustainable livelihoods for the population of the project area, and demonstrating the benefits to the rest of the Qinling Mountains and other similar areas in the PRC. The Project will provide significant environmental, economic, and social benefitsthroughout the project area. It will address underlying causes and effects of historical and contemporary resource degradation.

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Project Name Shaanxi Qinling Biodiversity Conservation and Demonstration Project
Project Number 39321-013
Country China, People's Republic of
Project Status Approved
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Grant 0169-PRC: Shaanxi Qinling Biodiversity Conservation and Demonstration Project
Global Environment Facility US$ 4.27 million
Loan 2572-PRC: Shaanxi Qinling Biodiversity Conservation and Demonstration Project
Ordinary capital resources US$ 40.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Partnerships
Sector / Subsector Agriculture, natural resources and rural development - Forestry
Gender Equity and Mainstreaming Some gender elements
Description

The Qinling Mountains are an internationally important biodiversity hot spot and represent about 70% of the PRC's biodiversity, including an estimated 300 giant pandas. The Qinling Mountains are central to soil and water management of the Yangtze and Yellow rivers. The Project will improve biodiversity conservation and management by restoring forest habitat, improving endangered species management and providing sustainable livelihoods for the population of the project area, and demonstrating the benefits to the rest of the Qinling Mountains and other similar areas in the PRC. The Project will provide significant environmental, economic, and social benefitsthroughout the project area. It will address underlying causes and effects of historical and contemporary resource degradation.

The project area is 458 square kilometers (km2), about 45 kilometers southwest of Xi'an, the capital of Shaanxi, and is identified as the birthplace of the Taoist religion. The project area is divided into a plains area for ecotourism and agriculture development, and a mountainous area for biodiversity conservation. It is home to about 20,400 people. The plains have about 15,800 residents (77% of the total) who live on about 58 km2 (13% of the total project area) bordering the northern end of the project area. The poverty incidence is about 23%. This area also includes the township of Louguantai; several Taoist temples; the Qinling National Botanical Garden (QNBG) and nursery; the Shaanxi Animal Rescue Center (SARC), which includes threatened species of giant panda, golden monkey, golden takin, and crested ibis; and the Louguantai Forest Farm. About 71 million tourists visit Shaanxi province annually, of which about 400,000 visit the project area and about 1 million visit the Qinling Mountains. The larger but scarcely populated mountainous area is called the Qinling Biological Conservation and Demonstration Area (QBCDA), where the management objective is low-impact development that supports the conservation of biodiversity and provides sustainable livelihoods for about 4,600 residents (23% of total) on about 400 km2 (87% of project area).

The Project will produce three primary outputs: (i) participatory biodiversity management in the mountainous area, (ii) enhancement of biodiversity conservation in the plains area, and (iii) improved project management. Using sustainable financing mechanisms for biodiversity conservation, the habitat of the mountainous area, QBCDA, will be improved to promote mixed forest coverage, and flora and fauna species expansion. The small population lives in scattered settlements in QBCDA and will be encouraged to support biodiversity conservation objectives and minimize unsustainable farming and other activities.

The Project will develop biodiversity-based attractions that will generate funds for the management and enhancement of QBCDA. The commercial activities will involve a botanical garden, wildlife breeding and research (including a giant panda center second only to Sichuan province's Wolong Nature Reserve), and related ecotourism. QNBG will address a major weakness of the many past biodiversity projects by ensuring sustainable financing using part of the ecotourism revenue. Links with the Qinling Mountains nature reserves and an increase in biodiversity corridors will be pursued.

Project Rationale and Linkage to Country/Regional Strategy

The Qinling Mountains is biologically rich with many endangered, threatened, and endemic animal and plant species that need to be protected. The Qinling Mountains have about 25 national and provincial nature and forest reserves, many of which have received assistance from the Global Environment Facility (GEF), World Bank, and World Wide Fund for Nature (WWF).

The geography is dominated by mountains, rivers, streams, and forests. The major environmental issues are related to land and environmental degradation, endangered animals and plants, the presence of some exotic tree species, and the need for long-term animal and plant species regeneration and expansion as well as sustainable conservation and preservation management techniques. Other issues include employment and income-generating opportunities for the inhabitants, the availability of financing for biodiversity conservation in the project area and Qinling Mountains, and basic rural services in the project area. About 37% of the population in the project area is poor, with poverty increasing markedly from Louguantai south into the rugged mountain and forest terrain.

Because of the prevailing poverty, the project area and nature reserves in Qinling Mountains are subject to a high level of competing land-use pressure. This is a major reason why the sustainable management of biodiversity resources is important to the Shaanxi government, the Asian Development Bank (ADB), GEF, and WWF. However, the financial sustainability of biodiversity conservation is precarious, because conservation cannot compete financially with other less environment-friendly forms of land use. Species diversity is largely a public good, and the revenue generated from ecotourism often does not cover the costs of creation and management. To improve the funding situation, protected areas must generate their own revenue. Because of its favorable location in relation to Xi'an, the project area will be able to generate revenues to cover most, if not all, of its operational and management costs.

The Project will pursue a market-based approach to biodiversity conservation, featuring sustainable revenue generation and use, land maangement, and conservation management. Biodiversity conservation is a high priority of the Government, as reflected in the 11th Five-Year Plan, the State Environmental Protection Agency's biodiversity strategy, and the QM Ecosystem Function Conservation Plan. The Project will strengthen the management of nature reserve areas in QM through integrated approaches including market-oriented measures to sustain environmental and biodiversity objectives while increasing rural incomes and reducing poverty. The public sector is required to ensure preservation of the natural and cultural heritage sites in the project area.

The lessons learned from previous integrated agriculture and rural development and environment projects in the PRC and Shaanxi province, as well as other major provinces with biodiversity activities, including Sichuan and Yunnan, have been incorporated in the Project. The provincial government and the imlementing agency (IA), QNBG, have strong commitment and ownership of the Project. All major stakeholders have been extensively consulted. Linking biodiversity conservation with revenue generation in the PA and QM is fully supported. The Project is well-focused in terms of area coverage and the outputs are well-defined, closely linked, and within the capacities of the IAs to effectively manage. The Shaanxi Provincial Government (SPG) has successfully implemented theree ADB-financed projects in environmental protection, roads, and railways. It has also successfully implemented 14 World Bank-financed projects in forestry, water, agriculture, poverty reduction, and environmental protection, several of which are co-financed with GEF. Many of the successful features of WWF assistance in biodiversity conservation nad income generation have been included in the Project.

Impact Sustainable biodiversity conservation protected for globally-significant species and increased economic growth
Project Outcome
Description of Outcome The expected outcome of the Project is improved and integrated biodiversity management that provides sustainable livelihoods for the population of the project area.
Progress Toward Outcome The project experienced delay in implementation, but project outcome is likely to be attained with a revised implementation timeframe.
Implementation Progress
Description of Project Outputs

Participatory Biodiversity Management in the Mountainous Area

1. Demonstrating conservation of biodiversity

2. Improved village and forest-based livelihoods

Enhanced Biodiversity Conservation in the Plains Area

1. Develop the national botanical garden

2. Improve the animal rescue center

Improved Project Management

1. Strengthened PMO and IA

2. Strengthened biodiversity safeguards

3. Conservation dissemination program

Status of Implementation Progress (Outputs, Activities, and Issues)

Component 1: Participatory Biodiversity Management in the Mountainous Area. (i) Habitat restoration and management for 2,000 ha of state forest land was completed by about 50% using government funds. The remainder will be financed using GEF funds and the sites have been identified. Forest Land Use Certificates for 5,000 ha of collective forests have been awarded. Endangered species management planning funded by GEF just started in Quarter I of 2015. (ii) Village development plans and livelihood facilities are expected to start in April 2015. Small businesses are developing well although data to support the observed changes is required. Procurement for conservation forestry planting on 5,000 ha is in processing and works will start in early 2015.

Component 2: Enhanced Biodiversity Conservation in the Plains Area. (i) 4 out of 22 gardens of QNBG have been completed. Construction of the multifunction building was started in May 2014. Engineering design for other buildings and facilities are yet to be completed. (ii) For SARC, 70% construction of the Giant Panda enclosure ground was completed. A spatial plan for animal exhibition and enclosure facilities was confirmed and the engineering design will start in Quarter IV of 2014.

Component 3: Improved Project Management. Consultants for safeguards and project management have started work. Consultants to support design of SARC and project social baseline as well as evaluation are to be recruited by the end of October 2014. Strengthened biodiversity safeguards and conservation dissemination programs financed under the GEF grant are expected to start in March 2015.

Geographical Location Qinling Mountains are located 40 km south of Xian
Safeguard Categories
Environment B
Involuntary Resettlement A
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects Most project impacts will be environmentally friendly, including improvements to long-term biodiversity conservation, improvement in the welfare of animals in SARC and QBCDA, advancement of science on endangered species, genetic collection and protection, public awareness and education regarding biodiversity conservation in the Qinling mountains, increased forest cover and density, improved environmental quality of water systems, and conservation of Taoist religious sites in the protected area. Some adverse impacts may occur due to invasive species and release of species in the wild, but mitigation measures have been taken to minimize these impacts.
Involuntary Resettlement A resettlement plan has been prepared and the land acquisition and resettlment plan has been discussed and agreed with the affected persons. Mitigation measures include new housing provided in the same village area that meets the expectations of the villagers affected, cash compensation, land lease agreements, and sharing the gate revenues from ecotourism to the botanical gardens.
Indigenous Peoples There are no indigenous people in the project area.
Stakeholder Communication, Participation, and Consultation
During Project Design Consultation with stakeholders, beneficiaries, and affected persons has been undertaken and will continue during implementation. During project design, a detailed survey took place of households, discussions were held with project stakeholders at all levels, key informant interviews were conducted in rural communities, stakeholder workshops were conducted, and interviews were held with key government staff, nongovernment organizations, villagers, and women.
During Project Implementation
Business Opportunities
Consulting Services Consultants will be recruited in line with ADB's Guidelines on the Use of Consultants (2007, as amended from time to time). The Project will provide 84 person-months of consulting services, comprising 15 person-months of international experts and 69 person-months of national experts. These services will be procured in two packages. For package A, which will be financed under the GEF grant, QNBG's SARC division will select and engage six individual consultants for 1 month each-one international and one national expert for each of the giant panda, crested ibis, and golden monkey habitats and plans for effective conservation. For package B, which will also be financed under the GEF grant, the PMO will select and engage a consulting firm using the quality- and cost-based selection method (80:20) and the full technical proposal procedures. The consulting firm will provide expertise in biodiversity conservation, species recovery management, ecotourism planning, village development planning, animal exposition and breeding, wildlife veterinary services, species recovery and survey, conservation forestry, and geographic information systems.
Procurement All procurement of goods and works will be carried out in accordance with ADB's Procurement Guidelines (2007, as amended from time to time). Contracts for goods estimated to exceed $1.0 million and contracts for works estimated to exceed $10.0 million will be procured using international competitive bidding procedures. Contracts for goods and works estimated to cost less than the international competitive bidding values, but more than $100,000, will be procured through national competitive bidding procedures in accordance with the PRC Tendering and Bidding Law, 1999, subject to modifications agreed upon with ADB. Contracts for goods and works estimated to cost $100,000 or less shall be procured using shopping procedures. The relevant sections of ADB's Anticorruption Policy (1998, as amended to date) will be included in all procurement documents and contracts.
Responsible ADB Officer Zhiming Niu
Responsible ADB Department East Asia Department
Responsible ADB Division PRC Resident Mission
Executing Agencies
Shaanxi Provincial GovernmentMr. Wang Shuancangfgwwdb@shaanxi.gov.cnXian, Shaanxi province
Timetable
Concept Clearance 10 Aug 2007
Fact Finding 13 Aug 2007 to 25 Aug 2007
MRM 21 May 2008
Approval 22 Oct 2009
Last Review Mission -
PDS Creation Date 10 May 2006
Last PDS Update 21 Mar 2015

Grant 0169-PRC

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
22 Oct 2009 02 Jul 2010 15 Oct 2010 31 Oct 2015 31 Oct 2017 -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 4.27 Cumulative Contract Awards
ADB 0.00 22 Oct 2009 0.00 0.36 8%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 4.27 22 Oct 2009 0.00 0.85 20%

Loan 2572-PRC

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
22 Oct 2009 02 Jul 2010 15 Oct 2010 31 Oct 2015 31 Oct 2017 -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 128.37 Cumulative Contract Awards
ADB 40.00 22 Oct 2009 9.76 0.00 24%
Counterpart 88.37 Cumulative Disbursements
Cofinancing 0.00 22 Oct 2009 8.53 0.00 21%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - - - - - Satisfactory

Evaluation Documents

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