Implementation Status & Results Peru Second Programmatic Environmental Development Policy Loan (P116152)

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1 Public Disclosure Authorized Public Disclosure Authorized losure Authorized Public Disclosure Authorized The World Bank Project Name: Implementation Status & Results Peru Second Programmatic Environmental Development Policy Loan (P116152) Second Programmatic Environmental Development Policy Program Stage: Implementation Seq.No: 2 Status: ARCHIVED Last Modified : 16-Feb-2011 Loan (P116152) Country: Peru Approval FY: 2010 Product Line: IBRD/IDA Region: LATIN AMERICA AND CARIBBEAN Lending Instrument: Development Policy Lending Implementing Agency(ies): Ministry of Energy and Mines, Ministry of Environment, Ministry of Production, Ministry of Economy and Finance Key s Board Approval 08-Dec-2009 Original Closing Planned Mid Term Review Last Archived ISR 03-Feb-2010 Effectiveness 22-Dec-2009 Revised Closing Actual Mid Term Review Program Development Objectives Program Development Objective (from Program Document) The Second Programmatic Environmental DPL continues to support the government's efforts to strengthen environmental governance and institutions in Peru, and mainstream environmental sustainability in the development agenda of key sectors (mining, fisheries, urban transport and energy). Within the scope of th EVDPL program, this second DPL is consisten with one of the key pillars of the 2006 CPS for Peru for FY06-FY11 (and the 2009 CPS Progress Report) laying out a strategy to support the GOP to achieve its goals of sustained economic growth. The CPS recognized the need to raise the profile of environmental issues in Peru by enhancing environmental public investments and strengthening the institutional famework. In support of CPS pillar I on economic growth, the ENVDP program will contribute to making growth environmentally sustainable by supporting the environmental legal and insitutional famework, biodiversity conservation, enhancing control over air and water pollution, improving the sustainability of the mining sector, and the sustianable management of fisheries resources. In addition, by supporting the policy instruments of the newly created MINAM, the ENVDPL program would contribute to the modernization of the state institutions (CPS pillar III). Has the Program Development Objective been changed since Board Approval of the Program? Yes No Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Implementation Status Overview The Second Programmatic Environmental DPL was approved by the Board on December 8, Full amount of the loan (US$50 million) was disbursed in a single tranche on January 29, Results Page 1 of 7

2 Results Indicators MINAM has the capacity to review at least 5 Environmental Impact Assessments (EIAs) of large infrastructure/investment projects with potentially significant impacts. zero None reviewed so far in 2009; Regulation of the Law on the National System of EIA approved in September MINAM will now randomly review EIAs for large projects and activities. At least 10 projects reviewed per year. National Service of Natural Protected Areas applies financial strategy to increase national protected areas funding from various sources (including private sector) by at least US$2 million/yr $14.2 million $17.35 million $24 million Air quality data Lima-Callao metropolitan region is widely published and disseminated (in real time) through harmonized monitoring network. No pollution contigency plans exist in Peru except for La Oroya. Contingency plans for Arequipa, Ilo and La Oroya; Clean Air Action Plans for Iquitos, Chimbote, Trujillo and Ilo. Harmonized monitoring network publishes air quality data in real time. Air quality contingency plans developed and implemented. Page 2 of 7

3 Priority Mining Environmental LEgacies identified following the prioritysetting update No mining environmental legacies have been identified using technical criteria 119 priority mining environmental legacies have been prioritized in 6 former mining units in Cajamarca. 30-Sep-2009 At least 10 priority mining environmental legacies are identified following theprioritysetting update of the MELs inventory. Environmental participatory monitoring 35 community-based monitoring pilots Continuous monitoring of at least 40 sites Environmental participatory monitoring undertaken in at least 60 sites. Gas stations supplying clean diesel (with less than 50ppm of sulfur content) zero gas stations All gas stations in Lima-Callao supplying clean diesel with less than 50ppm of sulfur content At least 30 percent of gas stations in main cities (approx. 750) supplying clean diesel Page 3 of 7

4 Conversion of gasoline vehicles to natural gas and natural gas service stations installed and operating. 35,000 vehicles converted to natural gas in Lima 86,000 vehicles converted to natural gas in Lima 30-Mar-2010 At least 80,000 vehicles converted to natural as and 90 service stations are installed and operating in Lima Vehicle inspection and maintenance system operating in Lima 6 inspection lanes operational in Lima for heavy-duty vehicles In Lima: 5 heavy duty lanes, 4 mixed, 24 for light vehicles 585,000 vehicles inspected in Lima. In Trujillo: 2 for heavy vehicles; 1 mixed. In Chiclayo 1 mixed, 1 forlight vehicles. In Arequipa: 1 lane for heavy vehicles. 30-Sep-2009 At least 20 lanes for vehicle inspection and maintenance operating in Lima, and at least 3 lanes in each of the 3 largest cities. Anchoveta fishing fleet under quota system zero percent regulated by quotas 100 percent now regulated 100 percent of anchoveta fleet under the quota system Page 4 of 7

5 Promote sustainable fisheries Zero workers benefit from economic incentives for leaving the sector and reduce overcapacity Around 1,300 fishermen left the sector as of June At least 3000 workers benefit from economic incentives for leaving the sector. Report on the economic, environmental and social consequences of anchoveta quota system is issued by an independent observatory None None 30-Sep-2009 Report on the economic, environmental and social consequences of anchoveta quota system is issued by an independent observatory Data on Financial Performance (as of 29-Jan-2010) Financial Agreement(s) Key s Project Loan No. Status Approval Signing Effectiveness Closing P IBRD Effective 08-Dec Dec Dec-2009 Disbursements (in Millions) Project Loan No. Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P IBRD Effective USD Tranches Tranche 1 Description One Amount (USD) Expected Release Actual Release Status Feb Jan-2010 Pending Released Page 5 of 7

6 Tranche Condition Description Status If If Delayed The Government of Peru (GOP) has defined the roles and responsibilities of MINAM in the evaluation of environmental impact assessments for large projects and key sectors pursuant to the issuance of Borrower#s Supreme Decree Nº MINAM (Regulation of Law No for the National System of Environmental Impact Assessment). MINAM has approved the financial strategy of the Natural Protected Areas System (Plan Financiero del Sistema de Areas Naturales Protegidas por el Estado), pursuant to the issuance of Presidential Resolution No SERNANP. Approval of the Action Plan for Natural Protected Areas System (Plan Director), pursuant to the issuance of Supreme Decree No MINAM. The GOP has issued regulatory measures to promote private sector financing and management of NPAs, as evidenced by: (a) SERNANP#s approval of #Guidelines for the Creation of Trust in National Protected Areas#; and (b) the issuance of Supreme Decree No MINAM, which regulates tourism activities within NPAs. Publication and dissemination on SENHAMI#s and DIGESA#s websites of daily air quality monitoring data for the cities of Lima and LaOroya. The GOP has: (a) approved Directorial Resolution Nº MEM-DGM, which mandates the application of PERCAN#s methodology for theidentification and prioritization of all mining environmental legacies; and (b) approved a three-year work program with budget for calendar year 2010 to identify, rank, and manage mining environmental legacies. The GOP, through MINEM, has: (a) issued a Ministerial Resolution No MEM/DM, which approved norms to regulate the process of participatory environmental monitoring and surveillance in mining exploitation activities; and (b) started the operation of at least 40 initiatives of environmental participatory monitoring. The GOP has issued Supreme Decree No EM, which prohibits the supply of diesel with more than 50 ppm of sulfur content in the cities of Lima and Callao. The GOP has continued the promotion and implementation of vehicle conversions to natural gas, as evidenced by an allocation in the proposed budget for calendar year The GOP has issued Directorial Resolution Nº MTC/15, which regulates the implementation of a vehicle inspection and maintenance system according to a timetable based on license plate numbers in the Lima metropolitan region. The GOP has issued Supreme Decree No PRODUCE (Regulation of Legislative Decree No 1084), which mandates: (a) the implementation of fishing quotas by vessel; (b) the implementation of the social compensation fund for fisheries; and (c) the implementation of the retirement pension fund for fisheries. Key Decisions Regarding Implementation None. Restructuring History There has been no restructuring to date. Page 6 of 7

7 Related Operations P Peru First Progrmmatic Environmental Development Policy Loan /DDO, P Second Programmatic Environmental Development Policy Loan, P Peru Third Programmatic Environmental Development Policy Loan Page 7 of 7