Public Disclosure Authorized. Public Disclosure Authorized. Public Disclosure Authorized. Public Disclosure Authorized. Report No.

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1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Report No. PID5648 Project Name Ghana-Natural Resource Management Project (NRMP) (#) Region Sector Project ID Implementing Agency Africa AT Forestry, Environment, Land Management GHPE946 Date of PID 09/15/97 Appraisal Date 11/15/97 Board Date 03/17/98 Country and Sector Background Ministry of Lands and Forestry, Accra-Ghana. 1. The Republic of Ghana, with an area of 238,500 km2, lies between 5 and 11 N latitude and between 1 and 3 E longitude. It is bounded by Cote d'ivoire on the West, Burkina Faso on the North, Togo on the East and the Atlantic Ocean on the South. Its population is estimated at 17 million and growing at the rate of 3t per annum. Agriculture is the main economic activity, for a long time dominated by cocoa and food crops. In recent years other crops have been receiving increasing attention and contributing to the diversification of the sector. The timber industry, concentrated in the high rainfall south western quadrant of the country, is also an important contributor to the economy, and a major export item. 2. Ecologically, Ghana has two main zones: the high forest and the savanna. The high forest zone covers roughly one third (8.2 million ha) of the land area, and supports two thirds of the population. It includes wet and moist evergreen and semi-deciduous forests. It has good soils and a bi-modal annual rainfall ranging between 1,300 mm and 2,100 mm. Most of the country's economic activities (cocoa, oil palm, rubber, timber and mineral production) are concentrated in this zone. The savanna zone covers two thirds (16 million ha) of the national territory. About 40t of it is in the three northern Regions of Upper East, Upper West and Northern and the rest is mainly in the Brong Ahafo and the Volta Regions. This zone has four types of vegetation: the derived savanna, the southern Guinea, the northern Guinea and the Sudan savanna. This zone has a mono-modal annual rainfall ranging between 800 and 1200 mm occurring between the months of June and December. The soils are relatively poor and the main economic activities are in shifting annual crops (foodcrops, groundnut, cotton) and in livestock production. 3. All land is either community owned, "stool" or "skin" lands, vested in the local chiefs, or individual freeholdings, or in rare very cases, State owned. Their use is divided between (a) reserved and unreserved high forest million ha, producing mainly timber; (b) savanna million ha, some of which are woodlands and include reserves, while the rest is grazing; and (c) agricultural land, including bush fallow million ha. The

2 legal status of the land can be grouped as (a) Forest reserves, million ha of which 1.6 million are in the high forest and the remainder in the savanna woodlands; (b) wildlife reserves million ha; and (c) unreserved lands million ha. Under the present National Forestry Sector Master Plan, about half of the existing reserved area within the high forest zone will be retained under production forestry. Of the remainder, about 50t of which is in relatively pristine condition is slated for protection and the remainder that is in degraded condition, is targeted for restoration, convalescence, or plantation development. Project Objectives 4. The project's primary objective is to establish the institutional and operational framework, within the public and private sectors, for sustainable, participatory management of Ghana's soil, water, wildlife and forest resources; conservation of biodiversity; and, rehabilitation of degraded areas. It will assist communities to take lead responsibility in management activities and strive to ensure that land and forest resources are sustained at their optimum level of production and that opportunities for income generation are widened, particularly for the growing numbers of disadvantaged rural poor who's actions constitute a potentially serious factor in the degradation of these resources. Rationale 5. The expected programs for managing the land, water, vegetation and animal resources, including rehabilitation of degraded areas, would place priority on private sector responsibility, particularly the rural communities taking ownership of the operations, including poverty alleviating activities. While some communities are already aware of the declining productivity of the land, the shrinking natural resource base, and the increasing poverty among substantial numbers of the growing population, the magnitude and seriousness of these problems is not generally appreciated. There is also inadequate general recognition that simple practical measures to halt or reverse degradation trends and restore at least in part, the natural balance on the land, are available and could be implemented locally with modest inputs. These programs would be formulated on a broad basis within the framework of sound land use planning, and in accordance with the capability of the land. The project would assist communities, acting through local trade groups and producer associations, families, schools, individuals and other stakeholder entities, to restore degraded areas, and manage the resources for efficient and sustainable production. This would build on experience gained during the last decade with community approaches to improving local environmental and living conditions. Project Components 6. In support of these objectives the project will adopt a broad sectoral lending approach and would have the following components: - 2 -

3 (a) High Forest Management This component will support the implementation of policy and institutional reforms designed to streamline public forest sector agencies and strengthen their technical capacity. Institutional restructuring will emphasize the role of public agencies in providing technical assistance to communities in the development of collaborative forest management plans with the private sector, in monitoring and surveillance of management plan implementation, and in extension of good forest management practices into non-reserve areas. The core objective of this component is to facilitate the transition from central government management to community-based collaborative management of the approximately 200 national forest reserves within the high forest zone. This will involve, inter alia, restructuring of the Forestry Department into a smaller more autonomous forestry service with the possible incorporation of more independent forest operation/log movement, coupled with concessionaires performance bonding, and a new royalty structure to properly reflect the real value of the timber resource and protect scarce species. To this end, the project would finance training, technical assistance and operational costs associated with the institutional reform program. It will also support the collaborative forest management initiative through assistance with participatory planning and institutional development, preparation and implementation of forest reserve and forestry district level management plans, promotion of low impact logging methods and direct involvement of local communities in forest reserve management. It will finance training and technical assistance for implementation of participatory planning and collaborative management of forest reserves, operational support for implementing management plans, and technical support for monitoring and surveillance of forest management initiatives. Financed by the GEF, the project would identify and document priority areas of global importance for biodiversity conservation to be excluded from future logging, develop community based management plans for protection of these areas, finance alternative livelihood schemes for affected communities, and provide for ongoing monitoring and evaluation of biological and social indicators of program performance. The project will promote the development of privately owned plantations to supply an increasing proportion of wood to the processing industry when, as planned, harvesting of natural forest declines. Plantation - 3 -

4 development would take place on private lands offreserve, and on degraded reserve lands. The project would establish a privately managed Plantation Development Fund/Company to be managed within an appropriate administrative framework; facilitate reserve land allocation to approved investors and private plantation management companies; establish a seed bank and support development of a privately operated, decentralized, seed distribution system; and support plantation related research, extension and stakeholder training. (b) Savanna Resources Management This component would concentrate on four main group of activities in the Upper East, Upper West and Northern Regions. Woodland reserve management proposals involving participation of communities for the would be developed on a pilot basis and tested for effectiveness and sustainability. The new approach would broaden the current restrictive encroachment protection objective to give the communities a key role in on-reserve management including shared operational responsibility and a stake in revenues derived from improved forest and woodland product harvesting and marketing. Participatory programs would be formulated to rehabilitate non-reserve areas degraded by poor land use practices; and to sustainably manage all the savanna zone natural resources, enabling more efficient productive use of these resources and improved marketing. The programs would be based on integrated land use plans starting on mini-watersheds from headwaters areas building on the experiences of the land and water management component of GERMP, taking into account not only the physical resources, but also the market situation, and the culture, needs and capabilities of the communities which rely on the land resources for their livelihood. Involvement of district environmental management committees in development of local land management plans would ensure compatibility with Local Environmental Action Plans (LEAPs). Support would be provided for capacity building within participating communities, the statutory Development Planning Sub-Committee and Environmental Management Committees of the District Assemblies, and also NGOs concerned with the programs. Training would focus on front line staff and private service providers such as NGOs, conducted through local institutions and training agencies equipped with the necessary facilities and skills for integrated management of land, water and vegetation cover for sustainable economic activities. A savanna implementation coordinating unit would be -4 -

5 established to take the lead role in the planning and implementation of the programs. This component would contribute to development of a National Action Program against Desertification as provided for in the International Desertification Convention to which GoG is a signatory. This program would be planned in cooperation with the national Environment Protection Agency (EPA) and relevant arrangements would be made to start implementation. (c) Wildlife Resource Management The wildlife management component will support institutional strengthening through restructuring and realignment of the Wildlife Department (WD) to enhance the economic and social sustainability of wildlife management programs and foster close collaboration between the WD and rural communities, the private sector, non-governmental organizations and other partners in management of protected areas, and wildlife in general. This component would support implementation of management plans and infrastructure improvements for selected protected areas, technical assistance and operational support for establishment of community managed reserves, and finance both infrastructure improvements and operational support to upgrade and modernize the management of the zoological gardens in Accra and Kumasi under a general initiative to improve environmental education and outreach efforts by the Department to be undertaken in partnership with national NGOs. The project would also seek to promote increased private sector/community involvement in wildlife related economic activities such as eco-tourism and game ranching; and improve understanding and support for wildlife conservation and management through public education. (d) Environment Management Coordination The NRMP will provide resources to assist capacity building of the Environmental Protection Agency (EPA) at national and regional levels and provide operational support to assist it to implement its new 5-year strategic plan for environment management coordination, including its human resource development and to develop sector specific guidelines in support of the activities of the NRMP. The project would also support the EPA program to provide training and technical support to district assembly level environmental management committees in the preparation of local environmental action plans and to bolster their capacity for locallevel land use planning. -5-

6 Support will also be given to further develop the Environmental Information System (EIS) established under the ongoing Environmental Resource Management Project, and to encourage its wider use as a planning tool in Ghana; and to support work on land administration issues influencing sustainable use of natural resources. Project Support Activities 7. Policy, Planning and Institutional Reforms. The project would assist the government to design and implement further sectoral policy and institutional reforms to enhance revenue capture and improve sustainability of the forest industry through streamlining the mandates and expenditures of forest sector agencies and strengthening their implementation capacity. Various agencies within the forestry sector are expected to devolve a considerable share of their responsibilities to the private sector. The project would assist private sector producer associations, NGO's and community-based organizations to extend their participation in the commercial forestry sector and complement the restructuring of the Forestry Department into a more efficient service-providing agency which is currently underway with ODA financed technical support. 8. Capacity Development. In view of the importance of participatory approaches for the identification, planning and implementation of the programs, priority would be given to strengthening or developing the capacities of interested communities to play a leading role in land and natural resource management. Such capacity building would take advantage of existing capabilities and potential of local institutions such as training and research institutes and NGOs, as well as individuals, with the requisite skills for undertaking the specific activities. Support would also be provided to strengthening the capacity of relevant NGOs in the rural areas to complement regional and district extension services and subject matter specialists, in training the communities. 9. Resource Information Systems. The present remote sensing equipment at the Planning Branch of the MLF at Kumasi would be upgraded into a Forestry / Wildlife / Biodiversity sectoral resource information node to be operated under the NRMP and supported by the Remote Sensing Applications Unit (RSAU) at the University of Ghana in Legon. A regional sub-node would be developed at Tamale, with appropriate capacity to facilitate the planning and monitoring activities of the savanna component. 10. Monitoring Land Use Changes. The countrywide land use / land cover information generated by the RSAU, based on satellite images dating back to 1990/91. It will be updated with satellite data from 1999/2000 images in compatible format to generate new data on land use and land cover changes during the current decade. Information on changes in land cover and utilization during the 1990's, when combined with other socio-economic information, would provide a powerful tool to study and assess the impact of recent policies and - 6 -

7 development activities on natural resources and the environment. Project Financing 11. Total project costs are tentatively estimated at US$ 52 million over five years, of which IDA would finance about $18 million, and other bilateral and multilateral cofinanciers who have already expressed interest would finance an equivalent amount. A proposal is currently under consideration by the Global Environment Facility to finance approximately US$ 9 million in incremental costs for biodiversity conservation within the high forest zone. The remaining $7 million would come from GOG, the District Assemblies and participating communities. Implementation Arrangements 12.. The Ministry of Lands and Forestry (MLF) will be the lead implementing agency operating through its Project Coordinating Committee (PCC) chaired by the Technical Director. The Ministry of Food and Agriculture (MOFA) and the Environmental Protection Agency (EPA) would also be involved in implementation of aspects of the project. The different components would be managed by specific decentralized management units within the collaborating agencies. The details of operating procedures for these units are currently under discussion. The implementation framework would be in line with the policies of GoG to decentralize the public service, and to give the District Assemblies operational responsibilities for development and provision of services within their districts. Project Sustainability 13. An important provision for long term sustainability of the NRMP is Government's commitment to policy and institutional reforms which places a greater responsibility on the private stakeholders, improvements in staff quality and performance in key support agencies, and appropriate funding, particularly at the regional and district levels. The participatory approach which will give major management roles and bring greater direct benefits to the respective communities and other private sector or stakeholders, will provide the essential element of ownership to ensure enduring maintenance. Within the high forest estate, Government's commitment to stabilizing sustainable harvest potential, increasing the share of benefits realized by the communities and improving both the knowledge base and management capacity for effective stewardship of the natural resources, will ultimately be a major factor in sustaining these resources and their value for the welfare of the rural population. Lessons learned from Past Operations 14. Experience from previous Bank lending operations in the forestry sector indicates the importance of addressing key policy and institutional reforms in parallel with strengthening technical management capacity including more direct involvement of landholding communities and other stakeholders. This project will - 7 -

8 support the implementation of policy and legislative reforms concerning improved forest royalty collection, more equitable and transparent distribution of revenues to stakeholders, introduction of improved sectoral guidelines for environmental protection and enhanced fiscal and technical monitoring and surveillance. The project will underwrite implementation of a major policy shift toward collaborative management of forest and other natural resources with rural communities and other stakeholders having much more direct participation in resource management decisions and greater realization of economic returns from resource management. Special Program Emphasis 15. The proposed program will give special emphasis to sustainable management of the natural resources and the environment and poverty reduction through: (i) policy reforms that will improve the logging, milling, and marketing of forest products and provide a greater share of the benefits to rural landholding communities; (ii) targeted interventions to improve the management of land and water resources as a means of increasing agricultural productivity for farmers, to reduce poverty particularly among women in the disadvantaged rural areas and improve food security and employment opportunities; (iii) special emphasis on community participation in the selection, planning, implementation and ownership of the programs. Environmental Category: A 16. A sectoral Environmental Assessment is needed to determine how proposed changes in the forest industry and improved management of the natural resources may affect the environment and to develop and promulgate best practice guidelines to minimize any negative impact. Contact Point: The InfoShop The World Bank 1818 H Street N.W. Washington, D.C Telephone No.: (202) Fax No.: (202) Note: This is information on an evolving project. Certain components may not necessarily be included in the final project. Processed by the InfoShop week ending February 13,