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World Bank Document Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No: 47192-BR PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN Public Disclosure Authorized IN THE AMOUNT OF US$78 MILLION TO THE STATE OF SÃO PAULO WITH THE GUARANTEE OF THE FEDERATIVE REPUBLIC OF BRAZIL FOR THE Public Disclosure Authorized SÃO PAULO SUSTAINABLE RURAL DEVELOPMENT AND ACCESS TO MARKETS PROJECT April 21, 2010 Sustainable Development Department Brazil Country Management Unit Latin America and the Caribbean Region Public Disclosure Authorized This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective April 16, 2010) Currency Unit = Brazilian Real (R$) US$ 1.00 = R$ 1.78 FISCAL YEAR July 1 – June 30 ABBREVIATIONS AND ACRONYMS CATI Coordenadoria de Assistência Técnica Integral – Rural Extension Directorate, State Secretariat of Agriculture and Supply CBRN Coordenadoria de Biodiversidade e Recursos Naturais – Directorate of Biodiversity and Natural Resources, State Secretariat of Environment CEPISP Conselho Estadual dos Povos Indígenas – State Council for Indigenous Peoples CTI Centro de Trabalho Indigenista – Center for Indigenous Work CPS Country Partnership Strategy CPI-SP Commissão Pro-Indio do São Paulo EIA Environmental Impact Assessment EMF Environmental Management Framework FEAP Fundo de Expansão do Agronegocio Paulista – São Paulo State Fund for Agribusiness FUNAI Growth FUNASA Fundação Nacional do Índio – National Indigenous Peoples Agency Fundação Nacional de Saúde – National Health Foundation GDP Gross Domestic Product GEF Global Environment Facility GPV Gross Production Value GT-CATI CATI Working Group for Work with Indigenous Communities IBGE Instituto brasileiro de Geografia e Estatística – Brazilian Institute of Geography and IPM Statistics IPEA Integrated Pest Management IPPF Instituto de Pesquisa Econômica Aplicada – Institute for Applied Economic Research ITESP Indigenous Peoples Planning Framework MRDC Instituto de Terras de São Paulo PMU Municipal Rural Development Council Project Management Unit PMP Pest Management Plan PRONAF Programa Nacional de Fortalecimento da Agricultura Familiar – National Program to Strengthen Family Farming RAP Resettlement Action Plan RRDC Regional Rural Development Council RPF Resettlement Policy Framework SAA Secretaria Estadual de Agricultura e Abastecimento – State Secretariat of Agriculture and SAAF Supply SEBRAE Sistema de Acompanhamento Físico e Financeiro, CATI Serviço Brasileiro de Apoio às Micro e Pequenas Empresas – Brazilian Service for Micro and Small Enterprises ii SEFAZ Secretaria Estadual da Fazenda – State Secretariat of Finance SEP Secretaria Estadual de Planejamento – State Secretariat of Planning SMA Secretaria Estadual do Meio Ambiente – State Secretariat of Environment SPLM São Paulo Land Management Project Vice President: Pamela Cox Country Director: Makhtar Diop Sector Manager: Ethel Sennhauser Sector Leader: Mark Lundell Task Team Leader: Laurent Debroux iii BRAZIL São Paulo Sustainable Rural Development and Access to Markets Project CONTENTS Page A. Country and sector issues ....................................................................................................... 1 B. Rationale for Bank involvement ............................................................................................ 3 C. Higher level objectives to which the project contributes ....................................................... 4 II. PROJECT DESCRIPTION .................................................................................................... 4 A. Lending instrument ................................................................................................................ 4 B. Project development objective and key indicators ................................................................. 4 C. Project Components ............................................................................................................... 5 D. Lessons learned and reflected in the project design ............................................................... 7 E. Alternatives considered and reasons for rejection .................................................................. 8 III. IMPLEMENTATION ............................................................................................................ 9 A. Partnership arrangements (if applicable) ............................................................................... 9 B. Institutional and implementation arrangements ..................................................................... 9 C. Monitoring and evaluation of outcomes/results ................................................................... 10 D. Sustainability ........................................................................................................................ 11 E. Critical risks and possible controversial aspects .................................................................. 11 F. Loan conditions and covenants ............................................................................................. 13 IV. APPRAISAL SUMMARY ................................................................................................... 14 A. Economic and financial analyses ......................................................................................... 14 B. Technical .............................................................................................................................. 14 C. Fiduciary............................................................................................................................... 15 D. Social .................................................................................................................................... 16 E. Environment ......................................................................................................................... 18 F. Safeguard policies ................................................................................................................. 19 G. Policy Exceptions and Readiness ......................................................................................... 19 Annex 1: Country and Sector or Program Background ......................................................... 20 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ................. 30 iv Annex 3: Results Framework and Monitoring ........................................................................ 33 Annex 4: Detailed Project Description ...................................................................................... 40 Annex 5: Project Costs ............................................................................................................... 52 Annex 6: Implementation Arrangements ................................................................................. 53 Annex 7: Financial Management and Disbursement Arrangements ..................................... 58 Annex 8: Procurement Arrangements ...................................................................................... 69 Annex 9: Economic and Financial Analysis ............................................................................. 75 Annex 10: Safeguard Policy Issues ............................................................................................ 82 Annex 11: Project Preparation and Supervision ................................................................... 102 Annex 12: Documents in the Project File ............................................................................... 103 Annex 13: Statement of Loans and Credits ............................................................................ 104 Annex 14: Country at a Glance ............................................................................................... 108 Annex 15: Maps......................................................................................................................... 110 v BRAZIL BR-SP SUSTAINABLE RURAL DEVELOPMENT AND ACCESS TO MARKETS PROJECT APPRAISAL DOCUMENT LATIN AMERICA AND CARIBBEAN LCSAR Date: April 21, 2010 Team Leader: Laurent Debroux Country Director: Makhtar Diop Sectors: General agriculture, fishing and Sector Manager/Director: Ethel Sennhauser forestry sector (70%); Agricultural extension and research (20%); Agricultural marketing and trade (5%); Agro-industry (5%) Themes: Land administration and management (P); Participation and civic engagement (P); Rural policies and institutions (P); Rural markets (S); Environmental policies and institutions (S) Project ID: P108443 Environmental screening category: Partial Assessment Lending Instrument: Specific Investment Loan Project Financing Data [X] Loan [ ] Credit [ ] Grant [ ] Guarantee [ ] Other: For Loans/Credits/Others: Total Bank financing (US$m.): 78.00 Proposed terms: US$ denominated VSL, commitment-linked with all conversion options, repayable in 30 years including a 5-year grace period and a level repayments schedule Financing Plan (US$m) Source Local Foreign Total Borrower 52.00 0.00 52.00 International Bank for Reconstruction and 78.00 0.00 78.00 Development Total: 130.00 0.00 130.00 Borrower: Responsible Agency: State of São Paulo State Secretariat of Agriculture Secretaria da Fazenda Av Miguel Estefano 3900 Av. Rangel Pestana 300 São Paulo, SP, Brazil São Paulo,
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