Lao People's Democratic Republic: Sustainable Natural Resource Management and Productivity Enhancement Project

Sovereign Project | 37579-032 Status: Closed

Summary

The Project will address institutional and capacity building requirements (including governance improvements) to enable improved management of the sector on a sustainable basis while contributing to the Government's overall objectives of enhancing agricultural productivity, promoting commercialization of agriculture, and protecting the country's natural resources. Project outputs comprise (i) capacity built in sector management, (ii) investment in resource management and productivity enhancement, and (iii) an effective project management structure.

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Project Name Sustainable Natural Resource Management and Productivity Enhancement Project
Project Number 37579-032
Country Lao People's Democratic Republic
Project Status Closed
Project Type / Modality of Assistance Grant
Source of Funding / Amount
Grant 0144-LAO: Sustainable Natural Resource Management and Productivity Enhancement Project
Concessional ordinary capital resources / Asian Development Fund US$ 20.00 million
Grant 0145-LAO: Sustainable Natural Resource Management and Productivity Enhancement Project
International Fund for Agricultural Development US$ 15.00 million
Strategic Agendas Environmentally sustainable growth
Drivers of Change Governance and capacity development
Partnerships
Sector / Subsector

Agriculture, natural resources and rural development - Agricultural policy, institutional and capacity development

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The Project will address institutional and capacity building requirements (including governance improvements) to enable improved management of the sector on a sustainable basis while contributing to the Government's overall objectives of enhancing agricultural productivity, promoting commercialization of agriculture, and protecting the country's natural resources. Project outputs comprise (i) capacity built in sector management, (ii) investment in resource management and productivity enhancement, and (iii) an effective project management structure.
Project Rationale and Linkage to Country/Regional Strategy

The Lao PDR has abundant natural resources and a small population, of which over 80% is dependent on agriculture for their livelihood. Significant numbers of indigenous peoples from a wide range of linguistic groups live in upland areas to the north and in the southern part of the Lao PDR along the border with Viet Nam. They forge their predominantly subsistence livelihoods from rotational cropping, which incorporates a heavy dependence on the natural forest and water resources. The incidence of poverty in these areas is over 60%, and is highest among ethnic groups.

The institutional and legal framework for sustainable and equitable management of agriculture and natural resources (ANR) is weak. This is evident in the ambiguity of policies and legislation, as well as inadequate professional and technically trained staff and facilities. At the provincial and district levels where most ANR management decisions are taken, there is a deficit of expertise and facilities. The situation is exacerbated by budgetary constraints (generally sufficient to meet staff salaries, but insufficient for operational and development activities).

The capacity of the ANR sector to support traditional livelihoods is coming under unprecedented pressure from the recent influx of foreign direct investment (FDI) and consequent granting of land concessions. Allowing large-scale commercial development where there is a weak regulatory and enforcement framework without adequate analysis of land capability and economic impact, and encouraged by land speculation is increasingly resulting in adverse social and environmental impacts on local people's livelihoods. It also compromises the Government's ability to preserve the country's rich and diverse forest environs (deforestation is actually increasing). Adverse impacts on ecological function and integrity include reduced recharge of aquifers and storage capacity of reservoirs and reduction in dry season irrigation areas (directly contributing to reduced agricultural production). Furthermore, the loss of forest, coupled with the expansion of economic activities, is likely to result in a positive net emission of greenhouse gases with global impact.

While trying to protect the natural resource base, the Government is conscious of the need to maximize productivity on existing arable land an area limited by topography, undeveloped water resources, and limited market access. Agricultural productivity is low by the standards of the Association of Southeast Asian Nations (ASEAN), and the recent achievement of broad national self-sufficiency in rice can only be maintained if the Government continues to improve agricultural productivity. Food insecurity remains common, especially in areas where the road network is underdeveloped.

Support for proven interventions within an existing implementation framework, which will contribute to the Government's overall sector development objectives and provide practical examples for the enhanced capacity of agency staff to manage the development process, is therefore justified.

Impact More efficient and sustainable natural resource management and improved sector productivity.

Project Outcome

Description of Outcome Enhanced institutional capacity at provincial and national levels to manage natural resource utilization in a sustainable manner.
Progress Toward Outcome The Project was completed on 31 December 2015. Activities until the end of the Project focused on completion of implementation of the subprojects, compliance with social safeguards covenants, enhancement of sustainability, and consolidation of project achievements for dissemination to other districts and provinces. The ADB Grant was closed on 10 May 2016. Preparations for closing the IFAD (27 July 2016) are being done by ADB.
Implementation Progress
Description of Project Outputs

1. Capacity building for Agriculture and Natural Resource Sector management implemented

(i) National and provincial staff capable of financial and economic appraisal and safeguard analyses

(ii) Land use and suitability mapping completed in the five provinces

(iii) Producer groups trained and self-sustaining

(iv) Government and donors committed to a common agricultural development framework

2. Investment in Resource Management and Productivity Enhancement Completed

3. Efficient project management operational

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

1. - 259 land concessions have been reviewed by the Appraisal Unit of DoPC MAF covering an area of 288,000 hectares.

- Land suitability and broad zoning maps have been produced for all 5 provinces (comprising 42 districts).

- Five hundred thirty-one production groups are financially independent and have started their own activities linking with private sectors.

- Five policy papers have been produced: (a) Policy Gap Analysis of MAF Agricultural Modernization Thrust in Relation to its Devt Strategy for 2015; (b) Sugarcane Contract Growing Policy Gap Assessment Report; (c) Policy Gap Assessment of Farmers' Land Certificate Issuance; (d) Policy Gap Assessment on Lao PDR Agricultural Commericialization Thrust Towards Meeting WTO Food Safety Requirements, and (e) Concepts for the Private Public Community Partneryship.

2. All subprojects have about 12% EIRR. Out of 71 subprojects, 67 are considered satisfactory in performance. All the subprojects have a total of 749 production groups, of which 71% are considered financially independent as the project only has limited support to promote their existing productions.

3. - NPCO and 5 PPOs have been established and are operational.

- All subprojects have been identified and prioritized across the 5 provinces. All 71 subprojects submitted to ADB for review have been approved by ADB.

- The total subproject investments funds availed is about $20.4M.

Geographical Location 5 Southern provinces covering Attapeu, Champassak, Salavan, Savannakhet and Sekong

Summary of Environmental and Social Aspects

Environmental Aspects The executing and implementing agencies implemented environment monitoring activities according to the approved initial environmental examination (IEE) and environment management plans (EMPs). ADB assessed that, overall, the environment safeguards compliance is ensured.
Involuntary Resettlement No issue on resettlement. Entitlements of affected persons and documentation required have been completed in accordance with the Due Diligence Reports (DDRs) for Involuntary Resettlement and Ethnic Groups.
Indigenous Peoples

Ethnic groups in upland areas are the primary beneficiaries. Women are also a target group. The Project developed guidelines for ensuring women''s involvement in the planning, implementation and sharing of benefits from the implementation of supported subprojects. To support mainstreaming of gender issues in subproject design and within MAF in general,specific methodologies were developed for engaging women at the community level in subproject planning in coordination with the Advance Women Unit of MAF.

The DDRs for Ethnic Groups found that positive impacts from subprojects accrued to ethnic groups. The External Monitoring Report for Social Safeguards confirmed that only minor and isolated negative impacts have been encountered and these have been mitigated.

Stakeholder Communication, Participation, and Consultation
During Project Design Undertaken.
During Project Implementation Multistakeholder consultations were conducted with NGOs (WWF and national civil society groups), womens groups (Lao Womens Union), and multilateral/bilateral orgns (UNDP/UNEP on the Poverty Environment Initiative), The Lao-German Land Management and Registration Project (LMRP), the FINMAP project supported by Finland and the The Programme for Forest Resource Information Management (DoF/JICA).

Business Opportunities

Consulting Services Consulting services were engaged to ensure effective implementation at the national level and to assume responsibility for identification of potential subprojects and their implementation at the provincial level. Staff conducted training in safeguards, appraisal techniques and geographic information systems/information management. The consulting firm, which comprised international and national specialists, was recruited by the Project Management Office (PMO) in line with ADB's Guidelines on the Use of Consultants by Asian Development Bank and Its Borrowers and the Project's Procurement Plan.
Procurement Goods and works financed by ADB and IFAD were procured in accordance with ADB's Guidelines for Procurement and the Procurement Plan.

Responsible Staff

Responsible ADB Officer Salter, Charles David
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Environment, Natural Resources & Agriculture Division, SERD
Executing Agencies
Ministry of Agriculture and Forestry
Vinoth Vansy
[email protected]
Vientiane, Lao PDR

Timetable

Concept Clearance 31 Mar 2011
Fact Finding 05 Aug 2008 to 31 Mar 2011
MRM 31 Mar 2011
Approval 23 Feb 2009
Last Review Mission -
PDS Creation Date 23 Oct 2009
Last PDS Update 30 Sep 2016

Grant 0144-LAO

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
23 Feb 2009 23 Mar 2009 08 Sep 2009 31 Dec 2015 - 10 May 2016
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 20.00 Cumulative Contract Awards
ADB 20.00 23 Feb 2009 20.00 0.00 100%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 23 Feb 2009 20.00 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - - - Satisfactory - Satisfactory

Grant 0145-LAO

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
23 Feb 2009 08 Jul 2009 23 Jul 2009 30 Sep 2016 - 27 Jul 2016
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 15.00 Cumulative Contract Awards
ADB 0.00 23 Feb 2009 0.00 15.18 97%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 15.00 23 Feb 2009 0.00 15.18 97%

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.


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