Audited Project Financial Statements

Environmental and Social Monitoring Report

Project Number: 47046-002 August 2020

PRC: Gansu Featured Agriculture and Financial Service System Development Project (January−June 2020)

Prepared by the Project Management Office of Gansu Featured Agriculture and Financial Service System Development Project for the Asian Development Bank.

This environmental and social monitoring report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature.

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Gansu Featured Agriculture and Financial Service System Development

Project

Loan Number: 3312-PRC

Safeguard Monitoring Report

Reporting Period January 1 – June 30, 2020

Prepared by the Project Management Office of Gansu Featured Agriculture and Financial Service System Development Project Date: August 27, 2020

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

TABLE OF CONTENTS

ABREVIATIONS AND ACRONYMS ...... 3 I. INTRODUCTION ...... 4 II. IMPORTANT ACTION AND SAFEGUARD ...... 9 A. Major actions...... 9 B. Safeguard...... 13 i. Progress of the establishment and implementation of ESMS by FIs: Environment Safeguards...... 13 ii. Good practices of environment management ...... 33 C. Social safeguard ...... 36 D. Social and gender ...... 39 E. Information disclosure ...... 42 F. Progress of implementing grievance redressing mechanism ...... 42 G. Application of MIS system in ESMS ...... 44 III. EFFECTIVENESS AND IMPACT OF PROJECT ENVIRONMENTAL MONITORING ...... 46 IV. PROBLEMS ENCOUNTERED IN ESMS IMPLEMENGTATION AND SOLUTIONS ...... 47 A.Issues ...... 47 B. Solution ...... 47 V. LESSONS LEARNT AND NEXT STEPS ...... 49 A. Lessons learnt ...... 49 B. Next steps ...... 50

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 1: SOCIAL AND GENDER ACTION PLAN MONITORING ...... 53 APPENDIX 2: ETHNIC MINORITY DEVELOPMENT MONITORING ...... 56 APPENDIX 3: ETHNIC MINORITY DEVELOPMENT PLAN ...... 57 APPENDIX 4: RECORDS OF COMPLAINTS ...... 68 APPENDIX 5: CREDIT MONITORING ...... 69 APPENDIX 6: CAPACITY BUILDING ACTIVITIES ...... 75 APPENDIX 7: FURTHER SUBLOANS OF THE PROJECT ...... 82 APPENDIX 8: SNAPSHOTS OF MIS ...... 87

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

ABREVIATIONS AND ACRONYMS

ADB Asian Development Bank BARA County Agriculture and Rural Affairs Bureau BOF County Bureau of Finance BOG Bank of Gansu BOL Bank of Lanzhou CNY Chinese Yuan CPMO County Project Management Office DARA Provincial Department of Agriculture and Rural Affairs DOF Provincial Department of Finance EES Expenditure Statement EMDF Ethnic Minority Development Framework EMDP Ethnic Minority Development Plan ESMS Environment and Social Management System EUR European Dollar IEE Initial Environment Evaluation FI Financial Intermediary GOC Government of China JRCB Jingning Rural Commercial Bank LRCB Lintao Rural Commercial Bank MARA Ministry of Agriculture and Rural Affairs M&E Monitoring and Evaluation MIS Management Information System MOU Memorandum of Understanding PMO Project Management Office PPMO Provincial Project Management Office RFSP Rural Financial Service Provider SGAP Social and Gender Action Plan USD United States Dollar WHO World Health Organization ZRCB Zhuanglang Rural Commercial Bank

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

I. INTRODUCTION 1. Asian Development Bank (hereafter refers to as ADB) approved the Gansu Featured Agriculture and Financial Service System Development Project (hereafter refers to as the Project) on November 12, 2015. ADB and the Chinese Government signed the Loan Agreement on December 8, 2015 and the project became effective on March 29, 2016. The planned total investment of the project is USD 200 million, including USD 100 million of ADB loan, USD 68.58 million input from Financial Intermediary (hereafter refers to as FI), USD 24.67 million contribution of beneficiaries and USD 6.75 million input of Gansu Provincial Government. The implementation period of the loan project is five years, completion on set on December 31, 2020 and the project closure is June 30, 2021. The maturity of the loan is 15 years including 9 years of grace period. The maturity date of the loan is November 1, 2030. 2. Project resources will be used to support the achievement of four outputs as (i) inclusive and environmentally-friendly featured agricultural production bases developed; (ii) farmer cooperatives and agricultural enterprises financed and strengthened; (iii) rural financial service system developed and enhanced; and (iv) capacity for project implementation and management strengthened. The objective of the project is to enhance the participation of farmers in more productive and market- oriented agricultural activities to achieve income growth. The Implementation Kick- off Workshop convened in Lanzhou of Gansu on June 2, 2016 symbolized the official start of project implementation. 3. As an innovative project of “agriculture + financing”, the most striking difference comparing this project with other projects operated through traditional models is the incorporation of financial intermediaries (FI). Through screening intermediary banks with the required qualifications, about 90% of project loan proceeds is on-lent to the FIs. Through close cooperation between the government and FIs, the FIs via market operation will use project resources to support local featured agriculture and the development of new rural financial institutions. In this process, the government fully plays the role of macro regulation and capacity building at all levels while the banks put their advantages in fund management and operation into full play to enable recycled use of limited funds serving the development of featured agriculture maximize its effects. Meanwhile, the project is meant to explore a sustainable model for financing in support of agriculture. The project also attaches great attention to capacity building of FIs as well as support to new rural financial service providers including rural banks, micro credit companies and mutual cooperatives to enhance the capacity of rural financing services and the development of diversified rural financing system. 4. With FI model, the first batch of selected FIs, including Bank of Gansu (BOG), 4 Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Bank of Lanzhou (BOL) and Yuzhong SPD Rural Bank established Environmental and Social Management System (ESMS) in June 2016. The newly selected Lintao Rural Commercial Bank (LRCB), Jingning Rural Commercial Bank (JRCB), and Zhuanglang Rural Commercial Bank (ZRCB) established Environmental and Social Management System (ESMS) in January 2019, to assess and manage the potential environment and social impacts of their lending activities, which is an important instrument to implement the environment and social safeguard policies of ABD, and also an important practice of applying ADB’s environment and social safeguard policies in credit activities of banks in China after Industrial Bank‘s adoption of Equator Principles, and this is highly aligned with the green development principles promoted by GOC. It is expected that the outcome generated through project implementation will be replicated and scaled-up in broader areas of China, which would contribute to the integrated, balanced and sustainable development of rural economy, the environment and the human society. 5. During the first half of 2020, investment delivered was USD 6.5897 million (equivalent to EUR 6.0645 million or CNY 40.8503 million), accounting for 28.70% of the 2020 plan, of which, the use of ADB loan was USD 0.4065 million (equivalent to EUR 0.3741 million or CNY 2.878 million)for 4.17% of the annual plan and the counterpart investment was USD 6.1832 million(equivalent to CNY 37.9722 million or EUR 5.6904 million) for 46.83% of the annual plan. By June 30, 2020, the accumulative investment of the project delivered was USD 179.7525 million(equivalent to EUR 165.4233 million or CNY 1181.8170 million), accounting for 100.57% of the base cost of the project, of which, the use of ADB loan was USD 83.0449 million(equivalent to EUR 76.4263 million or CNY 587.9161 million), accounting for 89.94% of the target of base cost, and counterpart funding investment was USD 96.7076million(equivalent to CNY 593.9009 million or EUR 89.0002 million), accounting for 111.93% of the allocation plan of the base cost.In the first half of 2020, FIs issued 215 sub-loans with recycled ADB funds and counterpart funds; ESMS was robustly completed and implemented for all these Sublonans in accordance with the project requirements. 6. In order to reduce the cost of project loans and based on research and analysis, the project applied to the ADB in June 2019 through the MOF to convert the loan currency from USD to EUR. Before the end of April 2020 and after completing the liquidation of the USD imprest account, ADB executed currency conversion for all ADB loans of the project on May 1, including the withdrawn and unwithdrawn, and converted 100 million USD loan currencies from USD to EUR. After conversion into EUR, the total amount of ADB loans is EUR 92,269,319.00, of which the FIL is EUR 75,841,689, the non-FI model is EUR 9,354,264.00, and the interest and commitment charge is EUR 7,073,366.00.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

7. As project implementation is approaching its completion, in addition to implementing ESMS as required during the reporting period, the project also focused on :(i) promoting the integration of ESMS and FIs' own businesses; (ii) strengthening the monitoring of the implementation effect of ESMS; (iii) continuously optimizing and improving ESMS practices; (iv) capturing experience and strengthening sustainable development of ESMS. 8. In the first half of 2020, COVID-19 almost has no impact on the project. In order to carry out the follow-up supervision and management of the project, the PPMO reduced the number of on-site supervision and investigations on the project counties and FIs, and increased the frequency of online follow-up supervision and management. That is, communication and supervision and management with CPMO and FIs through telephone, QQ, WeChat, web meetings, etc., and require CPMO and FIs to strengthen ESMS through online supervision implementation effect monitoring. 9. As we all know, the COVID-19 showed worldwide pandemic trend during 2020. Since the blocking of Wuhan city, Hubei Province started on 23 Jan, 2020, China comprehensively triggered the defensive battle against COVID-19. With the teamwork and cooperation between Chinese government and Chinese people, the Wuhan government released the unblocking control measurement of leaving channel from Wuhan at 0:00 AM, 8 Apr, 2020, which meant that China had significantly archived staged-success after the hard fighting against COVID-19 for more than two months. After the staged-success, the battle went towards “mitigation stage” from “containment stage”, and stepped into normalize prevention and control of “internal defense against rebound, external defense against input”. 10. Until 30 Jun, 2020, there were 163 accumulatively confirmed COVID-19 cases reported by Gansu government, including 91 local cases, 72 external input cases (2 death cases and 161 cured cases). The local cases mainly happened during the periods from 27 Jan, 2020 to 4 Mar, 2020. From 6 Apr, 2020 to 30 Jun, 2020, there was no added locally confirmed case in Gansu province. There was no suspected case in Gansu province from 29 Mar, 2020 to 30 Jun, 2020. There were not asymptomatic patients in Gansu province from 24 Apr, 2020 to 30 Jun, 2020. Starting from Mar, 2020, the people of overseas charter flight landing at Lanzhou international airport have been transferred to Lanzhou New District for centralized isolation and observation about 14 days. The abroad confirmed input cases have been separately cured in the provincially specified hospitals. So, the local cases in Gansu province have been comprehensively controlled, and the external input cases were in the controllable range, which would not result in the spread of COVID-19 among Gansu province during the reporting.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

11. According to the national and provincial requirement of epidemic prevention, the 13 project counties were positively doing the prevention and control workings. During the reporting, except one COVID-19 confirmed case happened in Yuzhong County, which has been cured in the specified hospital, there was no COVID-19 confirmed case occurred in the other 12 project counties. 12. Facing the unexpected COVID-19, Chinese government responded rapidly and made a lot of scientific and cautious rules for cure and prevention, such as Scheme for Diagnosis and Treatment of Novel Coronavirus Pneumonia and Novel coronavirus infection prevention knowledge Handbook. From central government to local government, and spreading to community, all the Chinese people were mobilized. The strict home isolation and spot disinfection were carried out. Nucleic acid amplification testing was timely executed. The cure for patients was effective and free.The timely, open and transparent messages about COVID-19 were released.Finally, the protection knowledge of epidemic was scientifically distributed. 13. During the reporting, according to the implementation of project, combing with the national prevention and control rules and measurements of COVID-19, PPMO positively communicated with each project county to understand the local situation of COVID-19 and grasp the local prevention and control measurement in detail. According to the prevention and control of epidemic in each project county, PPMO made and distributed the project health and safety plan (details are given in Table 1)). PPMO required each project county to do well the epidemic prevention and control workings according to project health and safety plan in the process of implementation. 14. During the first half year of 2020, COVID-19 greatly impacted on Chinese economics, society and education et al., but the influence was generally controllable. At end of Feb, 2020, the COVID-19 in Gansu province was effectively controlled and outbreak of COVID-19 was not occurred in wide range of Gansu province, which would not cause great impacting on economics, society and education in Gansu province. On 28 Feb, 2020, the working guidance for epidemic prevention and control and reworking and reproduction in field of safe production in Gansu province was jointly released by Gansu Provincial Work Safety Committee Office and Emergency Management Department of Gansu Province. In the working guidance, the reworking and reproduction of companies should be carried out in order in each district. As of Jun 30, enterprises and service industries in Gansu Province have resumed work and production. Fully restore normal traffic order, full resumption of school and class. The traditional off-line activities related with the projects were implemented in order. 15. During the reporting, the project activities of Establishment of production bases with type 1A and Support to cooperatives/ASMEs with type 1B have been finished.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

But, the active subjects are selecting for Rural financial service system for type 1C. In short, the COVID-19 has not been greatly impacted on the implementation progress of those projects. Although the daily business activities of physical bank were affected by COVID-19, the daily business activities were normally carried out via on-line business handling and supervision platforms such as e-bank and mobile bank and the ESMS of project was integrated into its bank business.

Table 1. COVID 19 – PROJECT Health & safety plan Item Protective Measures Implements Supervises Awareness • Preparation of awareness materials on COVID-19 e.g., signs, Enterprise, Disease materials posters. Farmers‘ Control

• Installation of awareness signs at work sites, for visibility to Professional Center , PMO, workers and the general public. Cooperative, PMO,FI

Detection • Control and document the entry/exit to the work site for both Enterprise, Disease Measures workers and other parties. Farmers‘ Control

• Prevent sick workers from entering the site through checking Professional Center , PMO, temperatures of workers and other people entering the site. Cooperative, FI • All workers to self-monitor their health, and take their body temperature regularly. Protective • All workers should wear a face mask. Enterprise, Disease Measures • Ventilation. Strengthen the ventilation of the workplace and Farmers‘ Control

During maintain indoor air circulation. Natural ventilation is preferred when Professional Center , PMO, Production the process permits, and do not use central air conditioning. Cooperative • Handwashing. The toilet area of the production workshop and office building should be equipped with hand-washing facilities, soap, paper towels or hand dryers to ensure the normal operation of hand-washing, eye-washing and spraying facilities in the workplace. If there is no hand washing equipment, 75% alcohol hand rub should be provided. • Cleaning and Disinfection. Clean and disinfect the surface of objects in the workplace. Public areas such as buses, official vehicles, reception rooms, offices, elevators, tables and chairs, workbenches, floors, and surfaces of objects should be disinfected regularly by a dedicated person, twice a day. Keep textiles such as work clothes, work caps, and seat covers clean, wash and disinfect them daily. Keep the environment clean and ventilated in staff dormitories, auxiliary sanitary facilities, canteens and other places, and strengthen regular disinfection of the places. • Avoid or reduce employee gatherings and collective activities as much as possible. Control the frequency and scale of meetings, and minimize the time required for meetings and trainings. When the time is too long, open windows for ventilation at least once an hour, ensure that the interval between participants in meetings or training is more than 1 meter, and wear a face mask. • Eat in the office or workshop lounge. If there are many people eating at the same time, you can eat at staggered times and avoid communication during the meal. Protective • All farms should wear a face mask. Enterprise/ Disease Measures of • When agricultural production operation, keep a distance of at Farmers‘ Control 8

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Item Protective Measures Implements Supervises Agricultural least 1 meter between farms and minimize physical contact. Professional Center , Planting and • Regular and thorough handwashing with soap and water or Cooperative,Far PMO, Village Breeding hand hygiene with alcohol-based hand-rub. ms,PMO Committee • Open windows frequently in daily life to keep the indoor environment hygienic，and keep the environmental hygiene of livestock and poultry enclosures，do a good job in disinfection of livestock and poultry enclosures. • The CPMO cooperates with the local disease control. center to strengthen the publicity of COVID-19 protection measures for farmers. • Everyone should self-monitor their health to self-monitor their health, and take their body temperature regularly. If have fever, dry cough, dyspnea and other symptoms, should go to the hospital in time. Protective • Everyone should wear a face mask. Enterprise, Disease Measures • Cancel or postpone non-essential travel to areas with Farmers‘ Control

During community medium and high risk of COVID-19. Professional Center , PMO Training and • Take personal protective measures, wash hands frequently Cooperative, Inspection and exercise frequently for employees who go out for training and PMO,FI inspection. Advise workers to comply with instructions from local authorities where they are travelling, as well as information on whom to contact if they feel ill while training and inspection. • Workers returning from an area where COVID-19 transmission is occurring should monitor themselves for symptoms for 14 days and take their temperature twice a day; if they are feeling unwell, they should stay at home, self-isolate, and contact a medical professional. Protective • During the establishment and implementation of the sub-loan FI Disease Measures ESMS, all stuffs wear masks. Control

During Loan • The FI staff should keep a distance of 1 meter from the sub- Center , PMO Business borrower. • FI staff takes personal protective measures and wash hands frequently. • Stuffs who are unwell or who develop symptoms consistent with COVID-19 to stay at home, self-isolate, and contact a medical professional or the local COVID-19 information line for advice on testing and referral.

II. IMPORTANT ACTION AND SAFEGUARD A. Major actions 16. With the joint efforts of the PPMO, national consultant team, FIs and the 13 CPMOs, important activities implemented in the first half of 2020 related to ESME are as follows: ⚫ Promoting the integration of ESMS with the FIs' own business. Up to now, ESMS has been established and implemented for all Subloans financed by ADB

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

loans and counterpart funds of FIs in accordance with the requirements of ADB. With the implementation of the project, the sustainable development of ESMS will be a direction for the future of the project. During the reporting period, the PPMO and the consultants shifted the focus onto the strengthening and guiding the integration of ESMS into FIs' own business. Through improving ESMS of Subloans financed by FI counterpart fund and carrying out training on the sustainable development of ESMS and other activities, the staff of FIs improved their understanding of practicing green finance, and integrated the environmental and social safeguarding rationales of ESMS into the FIs’ own business practice and into each loan of the FIs. ⚫ Strengthening monitoring of ESMS effect. Starting from the establishment of ESMS for the first sub-loan of the project in 2016 and according to the progress of the project, the PPMO required the FIs to carry out a full cycle of environmental and social risk control for all Subloans, so as to strengthen the monitoring of the implementation effect of ESMS. The CPMO and the FIs in their supervision of Subloans found that, comparing with those wh did not borrow from the project, the end borrowers of the project after implementing ESMS have paid more attention to the environment and social aspects while developing agricultural activities, borrowers hired higher proportion of women, minority farmers and poor farmers, demonstrating that the ESMS has been integrated into project activities. ⚫ The establishment and implementation of the ESMS for ADB recycled loans and FIs’ counterpart funds. During the reporting period, with the assistance of the consultant team, the client representatives and the environment managers of FIs followed the requirements of the Screening and Categorization of sub- projects as stipulated in the ESMS and carried out screening and categorization of 198 ADB recycled Subloans and 17 FIs’ counterpart Subloans. Activities supported by the recycled loan resources remained the same and the involved agricultural enterprises and cooperatives and production bases used the 38 original ESMS of 185 Subloans in 198 ADB recycled Subloans. Activities supported by the FIs’ counterpart loan resources remained the same used the 16 original ESMS of 11 Subloans in 17 FIs’ counterpart Subloans. 14 ESMS were established of 13 ADB recycled Subloans and 1 FIs’ counterpart Subloans, involving 1 production bases, 7 agricultural enterprises, 5 farmer cooperatives and 1 farmer households. The development of all ESMS strictly followed the stipulated requirements and steps. In this process, the PPMO and FIs worked closely with the county Agriculture and Rural Affairs Bureau, the CPMO and other relevant institutions to ensure quality control in the implementation of ESMS through irregular follow-up inspection.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

⚫ Broadening the scope of training and information dissemination. During the reporting period and according to the requirements of the project, PMOs and the FIs conducted five sessions ESMS training, including Yuzhong CPMO convened ESMS training in Yuzhong County. The environment/social officials of the CPMO presented to the environment/social manager, business managers and the loan officer of Yuzhong Shanghai Pudong Development Bank on the purpose, significance and related knowledge of ESMS in detail. In the first half of 2020, the staff and scope of ESMS training have changed significantly: (i) CPMOs take on the responsibility of promoting the implementation and application of ESMS. The CPMOs provides ESMS training to FI staff and the final borrowers, which also improves collaboration of stakeholders to jointly promote the implementation and application of ESMS; (ii) End borrowers are included in ESMS training, including the end borrowers of various loan activities such as planting, animal production, acquisition, processing, storage, etc. Through a combination of on-site lectures and hands-on guidance, training conveyed message to end borrowers that while improving agricultural productivity and pursuing the maximization of agricultural benefits, we must also pay attention to environmental and social issues in the process. This helped end borrowers proactively implement mitigation measures listed in the ESMS; (iii) with the changes in trainees and the scope of training, information dissemination of ESMS has been broadened with enhanced effects, leading to improved environmental awareness of project participants. Through ESMS training and information dessimination, it provides a theoretical and practical basis for FIs to integrate ESMS into their own business, and improves their ability to deal with environmental and social risks in lending activities. ⚫ Capturing experience and strengthening sustainable development of ESMS. The original intention of establishing and implementing ESMS in the project is to evaluate and manage the possible environmental and social impacts of loan activities of FIs. Based on the conformity between the establishment and implementation of ESMS and the green finance development concept of FIs, the PPMO plans to guide FIs in the next step to establish a green financial model based on ESMS in the hope that FIs can adjust and optimize the environment and social risk management and control standards of their own and their customer groups to continuously improve the ability to respond to global and regional environmental and social risks, successfully build a green financial system, and play an active role in increasing the supply of green finance and expanding green agricultural production. ⚫ Collection of cases of good practices. The year of 2020 is the final year of the project. After nearly 4 years of implementation, the government, FIs and

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

beneficiaries have different experiences and good practices in the establishment and application of ESMS. Starting from the initial establishment of ESMS, different training approaches, continuous supervision and follow-up visits as well as the implementation of ESMS, efforts will be made to continuously collect cases of good practices. ⚫ Continuously optimizing and improving ESMS practices. Bank of Gansu (BOG), Bank of Lanzhou (BOL) and Yuzhong SPD Rural Bank established Environmental and Social Management System (ESMS) in June 2016. Lintao Rural Commercial Bank (LRCB), Jingning Rural Commercial Bank (JRCB), and Zhuanglang Rural Commercial Bank (ZRCB) established Environmental and Social Management System (ESMS) in January 2019. In the application process of ESMS and in consideration of the actual conditions of the project, the PPMO, together with consultants, CPMO and FIs, strengthened supervision of ESMS,listened to the opinions of all stakeholders and actively communicated with ADB environmental/social experts in order to gradually optimize and improve ESMS: (i) relevant content of "Monitoring and Reporting" is added to the ESMS "Sub-project Screening and Classification Worksheet"; (ii) bulletin boards of townships and villagers’ committees in the residential area are selected for public disclosure of grievance redressing mechanism; (iii) during project training, efforts are made to strengthen the training of the grievance redressing mechanism so that farmers in the project area can understand the mechanism and can use it to protect their rights. ⚫ Continuous exploration of RFSP. During the reporting period, RFSP activities did not achieve new breakthroughs. The DOF and the PPMO are still looking for entities that can successfully implement RFSP activities, and it is expected to find new ones in the second half of 2020 to implement the activities. 17. During the reporting period, FIs in total disbursed 215 Subloans, of which, 198 Subloans financed by recycled ADB loan with value of USD 41.962 million (equivalent to EUR 38.6177 million, CNY 297.0699 million), 17 Subloans were financed by counterpart funds of FIs with value of USD 14.2594 million (equivalent to CNY 87.57 million, EUR 13.123 million) (details are given in table 2). Table 2. Disbursement of Further Subloans Amount Disbursed No. of Funding No. County Bank Subloans sources CNY 10,000 USD 1,000

1 Minxian BOL 1 15.00 24.43 Counterpart Yuzhong SPD 9 2600.00 3672.58 Recycled ADB 2 Yuzhong Rural Bank 1 100.00 162.83 Counterpart

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

3 Lintao LRCB 167 9786.99 13824.41 Recycled ADB 7 2930.00 4138.71 Recycled ADB 4 Jingning JRCB 9 2197.00 3577.48 Counterpart 15 14390.00 20326.29 Recycled ADB 5 Zhuanglang ZRCB 6 6445.00 10494.69 Counterpart Total 215 38,463.99 56,221.42

Note: ADB's fund exchange rate is the actual exchange rate that occurs in the project withdrawal appropriation bill. The recycled fund exchange rate is 1 USD =7.0795 RMB and the counterpart fund exchange rate is 1 USD =6.1412 RMB. 18. Beneficiaries of Subloans included agricultural enterprises, farm cooperatives and individual farmers who represent the largest segment of beneficiaries in terms of the number of Subloans borrowed (details are given in annex 6). B. Safeguard i. Progress of the establishment and implementation of ESMS by FIs: Environment Safeguards 19. During the reporting period, LRCB, ZRCB, JRCB, BOL and Yuzhong SPD Rural Bank disbursed 198 Subloans, including 185 Subloans based on recycled ADB loan, 17 Subloans used counterpart funds of FIs, and a total of 215 sub-loans were disbursed. Among the 198 Subloans of ADB recycled funds, the project activities supported by 185 of such Subloans remained unchanged, and the original 38 ESMS were used. Of the 17 FIs’ counterpart Subloans, 16 Subloans supported project activities unchanged, and the original 16 ESMSs were used. With the assistance of consultants, the FIs formulated ESMS for 13 ADB recycled fund Subloans and 1 counterpart fund Subloan. A total of 14 ESMSs were formulated, including 1 Subloan for the purchase of raw materials of Chinese medicinal materials by farmers, 4 Subloans for livestock and poultry production activities such as cattle, sheep, pigs, chickens; 5 Subloans for fruit and vegetable processing, wholesale and retail activities; 4 Subloans for forest tree nursery activities, involving 1 base, 7 agricultural enterprises, 5 farmer cooperatives, and 1 farmer. LRCB 20. In 2019, LRCB disbursed 1814 Subloans financed by ADB loan in Lintao and completed 127 sets of ESMS, involving 115 bases, 3 farmer cooperatives, and 9 agricultural enterprises; LRCB also used its counterpart funding to have disbursed 664 Subloans in Lintao and completed 25 sets of ESMS, involving 25 production

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

bases. During the reporting period, LRCB mainly uses recycled ADB loans to have issued 167 Subloans in Lintao for planting, animal production, and purchase, storage and transportation of agricultural products. If the borrowers of Subloans renew the loan and the project activities supported by the ADB recycled fund have not changed, the 159 Subloans financed by ADB recycled fund can continue to use the original 12 sets of ESMS. In the supervision of agricultural production by the CPMOs and the follow-up management of Subloans by FIs, the implementation of ESMS of each Subloan is monitored in real time, with a monitoring rate of 100%. 21. During the reporting period, among the 167 recycled ADB loans issued by LRCB, except the 10 bases and 2 farmer cooperatives that used the original 12 ESMS, there are also new end users of 1 production base, 29 farmers and 5 farmer cooperatives, 8 sets of ESMS for Subloans of recycled ADB funds were developed. Therefore, LRCB used the original 12 ESMS for the Subloans based on recycled ADB funds and developed 8 new ESMS in the first half of 2020. 22. Farmer households of the Subloans of LRCB are the mainstream borrowers, including 186 farmer households engaged in household production activities in the production bases that feature on open field vegetable production, greenhouse vegetable production, other cash crops production, cattle production, sheep production, pig production, chicken production, and tree crop nursery. According to the scope of the production base of cropping, average land area per household, and the scope of animal production base and the number of animal kept per household, original 12 sets of ESMS were used. The specific content is described as follows: Cropping: 23. Open field production bases include 1 bases of medicinal herbs and 1 bases of potato, used the original 2 sets of ESMS. The involved farmer households are loosely distributed in the 20 production bases. • In open field potato production, the area is 25 mu of a household; the smallest area of medicinal herb production is 4 mu, the largest is 35 mu and the average area per household is 12 mu. • Open field crop production base belongs to the same category of operations, during the production process of potato, and medicinal herbs, suitable amounts of pesticides and chemical fertilizers are used, but no pesticides published in the List of Banned and Restricted Pesticides (66 type) are used, including Dimethoate and Methamidophos. Chemical fertilizers used are selected from the National Implementation Standards of Fertilizers. Water use: lily production 14

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

is largely distributed in the valley areas irrigated by surface water (Taohe River) and the water consumption of production is 100 m3/year/mu; potato and medicinal herb production are mainly located in upland area of Lintao, which is completely rain-fed. Therefore, the production of medicinal herbs and potato do not constitute any water use conflict with other cropping activities, it does not affect the sustainable use of local water resources, and it does not generate any waste water. Given the average cropping area per household, the application of chemical fertilizers and pesticides and water use, open field crop production is assessed as Category C in general for environment impact. • Mitigation measures adopted by farmer households of open field crop production bases: (i) farm manure as the main source of fertilizer is used, pesticides that meet the national scientific and safety regulations for pest control is used to minimize potential damage to soil and water sources; (ii) surface water is rationally used for irrigation with water-saving measures, upland farming technologies are adopted to increase the efficiency of water use of natural precipitation; (iii) FIs in cooperation with BARA and CPMO carry out multiple sample checks for the application of fertilizer and pesticides during production of medicinal herbs and potato. 24. Lintao Hongxing Vegetable Planting Cooperative uses recycled ADB funds to carry out vegetable planting activities, using the original ESMS. • Lintao Hongxing Vegetable Planting Cooperative produced in greenhouses are pepper, tomato, cucumber and carrots with similar planting season and methods. In the process of vegetable production, suitable amounts of pesticides and chemical fertilizers are used, but no pesticides published in the List of Banned and Restricted Pesticides (66 type) are used. Chemical fertilizers used are selected from the National Implementation Standards of Fertilizers. Water use: vegetable production bases are located in the valley of Lintao where irrigation is based on surface water (Taohe River), and dripping irrigation is adopted. Water Conservancy Bureau uses GPS devices to have measured water consumption, which is 600m3/year/mu. There is no other consumption and no waste water generated. Given the average cropping area per household, the application of chemical fertilizers and pesticides and water use, greenhouse vegetable production is assessed as Category C in general for environment impact. ⚫ Mitigation measures adopted by Planting Cooperative of greenhouse vegetable production bases: (i) farm manure is used as the main source of fertilizer, use of chemical fertilizer and pesticides are strictly controlled and standardized, pesticides that meet the national scientific and safety regulations are used for

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

pest control to minimize potential damage to soil and water sources; (ii) surface water is rationally used for irrigation with water-saving measures such as dripping and sprinklers; (iii) FIs in cooperation with BARA and CPMO carry out multiple sample checks for the application of fertilizer and pesticides during production of greenhouse vegetables. 25. There are 1 production bases for other cash crops such as corn. using the original 1 set of ESMS and involving 2 farmer households, the average area per household is 10 mu.

⚫ The production process of corn requires suitable amounts of pesticides and chemical fertilizers, but no pesticides gazetted in the List of Banned and Restricted Pesticides (66 type) are used, including Dimethoate and Methamidophos. Chemical fertilizers used are selected from the National Implementation Standards of Fertilizers. Water use: corn is drought tolerant crops and irrigation will rely on precipitation. Therefore, the production of corn does not constitute any water use conflict with other cropping activities, it does not affect the sustainable use of local water resources, it does not generate any waste water. Considering the average cropping area per household, the application of chemical fertilizers and pesticides and water use, the production of corn a is assessed as Category C in general for environment impact. ⚫ Mitigation measures adopted by farmer households of other cash crops production bases: (i) farm manure is used as the main source of fertilizer, use of chemical fertilizer and pesticides are strictly controlled and standardized, pesticides that meet the national scientific and safety regulations are used for pest control to minimize potential damage to soil and water sources; (ii) surface water is rationally used for irrigation with water-saving measures such as dripping and sprinklers; (iii) FIs in cooperation with BARA and CPMO carry out multiple sample checks for the application of fertilizer and pesticides during production of greenhouse vegetables. 26. There are 2 tree crop nurseries involved. The smallest area of farmer households in the production base is 4 mu, the largest is 75 mu and the average area of nursery per household is 24 mu. In total, 2 sets of original ESMS are used and the involved farmer households are loosely distributed in the 2 nursery production bases. Lintao Jingxiu Seedling Planting Cooperative used recycled ADB funds for sapling production and the original ESMS is used. Lintao Huashan Seedling Planting Cooperative and Lintao Shenguiyuan Flower and Tree Cultivation Base used recycled ADB funds sapling activities with 2 ESMS established.

⚫ Impact of tree crop nursery production on the environment: (i) suitable amounts

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

of chemical fertilizers and pesticides are used in nursery production; (ii) water use: tree crop nursery production is largely located in the valley areas of Lintao with irrigation from surface water (Taohe River). The water consumption measured by water conservancy bureau using GPS devices is 90 m3/year/mu; which does not constitute any water use conflict with other cropping activities, it does not affect the sustainable use of local water resources, it does not generate any waste water. Considering the facts of nursery production of tree crops, its impact to the environment and water, the overall environment assessment is categorized as C for tree crop nursery production ⚫ Mitigation measures adopted in tree crop nursey production: (i) farm manure is used as the main source of fertilizer, the use of chemical fertilizer and pesticides are strictly controlled and standardized, pesticides that meet the national scientific and safety regulations are used for pest control to minimize potential damage to soil and water sources; (ii) surface water is rationally used for irrigation with water-saving measures such as dripping and sprinklers; (iii) herbicides banned and restricted by the state and WHO are not be used; and (iv) FIs in cooperation with BARA and CPMO carry out multiple sample checks for the application of fertilizer and pesticides during production of tree crop nursery. Animal farming 27. There is 1 cattle production base, farmer households of the production bases keep 4 cattle as the lowest and 20 as the highest in number, and the average cattle holding per household is 12. An original ESMS was used and the involved farmer households are loosely distributed in the 1 production bases. Lintao Xudong Farmers' Cooperative used ADB recycled funds for cattle production with ESMS completed.

⚫ Cattle raising area does not involve environmentally sensitive area and the construction activities comply with domestic environment assessment requirements of the Classified Administration Catalogue of Environmental Impact Assessments for Construction Projects. The base is at least 500 meters away from residential area and water course. The treatment of manure, urine and odor complies with the requirements of agricultural production and environment protects. Manure and urine are collected as much as possible for fermentation treatment before releasing as organic fertilizer for crop farming. Disease control of cattle strictly follows the Regulation of Animal Disease Control of Gansu Province. The method and the amount of chemicals (disinfectants) used are standardized. Given the strict environment and disease control requirements implemented at cattle production base as well as the number cattle kept by average farmer household, the overall environment

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

assessment of cattle production base is categorized as C. ⚫ Mitigation measures adopted by farmer households of cattle production base and cooperative: (i) low noise equipment and process is adopted, feedstuff processing is carried out in insulated workshops and the time of work is strictly controlled; (ii) cattle manure is timely removed for centralized fermentation as organic fertilizer or for sale to fertilizer manufacturer as raw material; (iii) sanitation of the farming surroundings is well maintained, cattle manure is timely treated to avoid over-piling. The structure of feedstuff has been improved, feedstuff with environment protection features are selected to reduce odor of manure; (iv) disease control is carried out strictly following the Local Standard of Animal Disease Control of Gansu Province; (v) isolation is established among function zones on the livestock farm. At the same time, FIs in cooperation with BARA, county environment protection bureau and CPMO carry out regular and ad hoc supervision over noise control and manure treatment. The frequency of regular supervision is at least 3-4 times/year. In line with the production cycle, ad hoc sample supervision will be implemented for multiple times. 28. There is 1 sheep production base, farmer households of the production bases keep 8 sheep as the lowest and 200 as the highest in number, and the average sheep holding per household is 40. An original ESMS was used and the involved farmer households are loosely located in the 1 production bases.

⚫ The sheep raising area does not involve environmentally sensitive area and the construction activities comply with domestic environment assessment requirements of the Classified Administration Catalogue of Environmental Impact Assessments for Construction Projects. The base is at least 500 meters away from residential area and water course. The treatment of manure, urine and odor complies with the requirements of agricultural production and environment protection. Manure and urine are collected as much as possible for fermentation before releasing as organic fertilizer for crop farming. Disease control of sheep strictly follows the Regulation of Animal Disease Control of Gansu Province. The method and the amount of chemicals (disinfectants) used are standardized. According to the strict environment and disease control requirements implemented at sheep production base as well as the number sheep kept by average farmer household, the overall environment assessment of sheep production base is categorized as C. ⚫ Mitigation measures adopted by farmer households of sheep production base: (i) low noise equipment and process are adopted, timing of construction is strictly controlled, and no noisy equipment is allowed at night time; (ii) sheep manure is timely removed for centralized fermentation as organic fertilizer; (iii) the

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

sanitation of sheep sheds is well maintained, sheep manure is timely treated to reduce the possibilities of odor; (iv) disease control is carried out strictly following the Local Standard of Animal Disease Control of Gansu Province; and (v) isolation is established among function zones on the livestock farm. At the same time, FIs in cooperation with BARA, county environment protection bureau and CPMO carry out regular and ad hoc supervision on noise control and manure treatment. The frequency of regular supervision is at least 3-4 times/year. In line with the production cycle, ad hoc sample supervision will be implemented for multiple times. 29. There are 1 pig production bases, farmer households of the production bases keep 25 pigs as the lowest and 80 as the highest in number, and the average pig holding per household is 32. An original ESMS was used and the involved farmer households are loosely located in the1 production bases. Lintao Xintai Ecological Planting and Animal Production Farmer Cooperative and Lintao Changsheng Animal Production Cooperative used ADB recycled funds for pig production with 2 sets of ESMS completed.

⚫ The pig raising area does not involve environmentally sensitive area and the construction activities comply with domestic environment assessment requirements of the Classified Administration Catalogue of Environmental Impact Assessments for Construction Projects. The base is far away from residential area and water course. The treatment of manure, urine and odor complies with the requirements of agricultural production and environment protection. Manure and urine are collected as much as possible for fermentation before releasing as organic fertilizer for crop farming. Disease control of pig strictly follows the Regulation of Animal Disease Control of Gansu Province. The method and the amount of chemicals (disinfectants) used are standardized. Given the strict environment and disease control requirements implemented at pig production base as well as the number pig kept by average farmer household, the overall environment assessment of cattle production base is categorized as C.

⚫ Mitigation measures adopted by farmer households of pig production base: (i) low noise equipment and process are adopted, timing of construction is strictly controlled, and no noisy equipment is allowed at night time; (ii) pig manure is timely removed for centralized fermentation as organic fertilizer or sale to fertilizer manufacturer as raw materials; (iii) the sanitation of pig sheds is well maintained, ventilation and air blowers are installed to regularly exchange air to reduce the possibilities of odor; (iv) disease control is carried out strictly following the Local Standard of Animal Disease Control of Gansu Province; and (v) isolation is established among function zones on the livestock farm. At the

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

same time, FIs in cooperation with BARA, county environment protection bureau and CPMO carry out regular and ad hoc supervision on noise control and manure treatment. The frequency of regular supervision is at least 3-4 times/year. In line with the production cycle, ad hoc sample supervision will be implemented for multiple times. 30. There is 1 chicken production base, farmer households of the production base keep 300 chickens as the lowest and 2,500 as the highest in number, and the average chicken holding per household is 1,000. An original ESMS was used and the involved farmer households are loosely located in the 1 production base.

⚫ Chicken production bases features on decentralized rearing in economic forest to take advantage of the spaces available in forest. Chicken droppings become fertilisers to trees and those from chicken sheds are also transported to crop field as organic fertilizer after treatment. Regardless it is centralized or decentralized chicken farming, disease control and disinfection are strictly implemented in line with the Regulation of Animal Disease Control. Given the strict environment and disease control implemented in the production base and the average holding of chickens per farmer household, the overall environment assessment of chicken production base is category C. ⚫ Mitigation measures adopted by farmer households of chicken production base to minimize impact on the environment: (i) all types of ventilation and feed processing equipment are housed and mufflers are stalled on noisy equipment powered by air; (ii) chicken droppings are timely removed for treatment as organic fertilizer for crop farming; (iii) chicken sheds are well ventilated, chicken droppings are timely removed to reduce the possibilities of odor; (iv) disease control is carried out strictly following the Local Standard of Animal Disease Control of Gansu Province; and (v) insulations are established among function zones on the farm. At the same time, FIs in cooperation with BARA, county environment protection bureau and CPMO carry out regular and ad hoc supervision on noise control and manure treatment. The frequency of regular supervision is at least 3-4 times/year. In line with the production cycle, ad hoc sample supervision will be implemented for multiple times. Activities related to purchase, wholesale, processing, storage and transportation: 31. Under Output 2, activities supported by ADB recycled funds involved 42 farmers and a original ESMS was used. Lintao Liuyang Fertilizer Co., Ltd., Lintao Huimin Agricultural Resources Co., Ltd. and Lintao Yuanqi Farmers Cooperative used ADB recycled funds for activities such as fertilizer purchase

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

and sale, purchase and sale of agricultural materials, and purchase of Chinese medicinal materials, with 3 sets of ESMS completed.

⚫ This category of activities involves purchase and processing of vegetables, medicinal herbs, lily and other agro-products, and its impact on the environment is primarily noise and some wastes, which are neglectable, therefore, it is Category C in environment assessment. ⚫ Mitigation measure: (i) low noise equipment and process are adopted, timing of construction is strictly controlled, and no noisy equipment is allowed at night time; (ii) wastes resulted from processing and purchase activities are timely removed and treated in centralized manner by categories of wastes; (iii) during transportation, all goods are well packed according to the requirements of the regulations of road transportation. ZRCB 32. In 2019, ZRCB disbursed 19 Subloans financed by ADB loan in Zhuanglang and completed 19 sets of ESMS, involving 3 farmer cooperatives, and 16 agricultural enterprises; ZRCB also used its counterpart fund to have disbursed 131 Subloans in Zhuanglang and completed 31 sets of ESMS, involving 25 bases, 3 farmer cooperatives, and 16 agricultural enterprises. During the reporting period, ZRCB combined with its own loan business with ADB recycled loan funds, and strengthened the supervision of the implementation of ESMS of the 150 Subloans in 2019, with the supervision rate of 100%. 33. During the reporting period, ZRCB used ADB recycled fund proceeds to have financed 10 Subloans in support of potato and apple production, animal rearing, storage, processing and transportation. If the borrowers of Subloans renew the loan and the project activities supported by the ADB recycled fund have not changed, the the 10 Subloans financed by ADB recycled funds can continue to use the original ESMS. ESMS has been established for 5 new borrowers using ADB recycled funds to carry out agricultural production activities, involving 5 agriculture enterprises. The 6 Subloans financed by counterpart funding focused on production of potato and apple, animal production as well as storage, transportation and processing of farm products. The project activities have not been changed, the 6 Subloans can continue to use the original 6 sets of ESMS, involving 5 agriculture enterprises and 1 farmer cooperative. Therefore, during the reporting period, the Subloans financed by ADB recycled funds issued by ZRCB used the original 10 sets of ESMS while new ESMS was established for another 5 Subloans; and Subloans of counterpart

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

fund used the original 6 sets of ESMS. The specific content is described as follows: Crop production 34. Zhuanglang Zhenrong Potato Cooperative used ADB recycled fund for potato production using the original ESMS.

⚫ Potato production needs suitable amounts of pesticides and chemical fertilizers, but no pesticides gazetted in the List of Banned and Restricted Pesticides (66 type) are used, including Dimethoate and Methamidophos. Chemical fertilizers used are selected from the National Implementation Standards of Fertilizers. Potato production in Zhuanglang primarily relies on precipitation with supplementary irrigation by surface water, therefore, potato does not constitute any water use conflict with other cropping activities, it does not affect the sustainable use of local water resources, it does not generate any waste water. Potato production of Zhuanglang Zhengrong Potato Cooperative is assessed as Category C in general for environment impact. ⚫ Mitigation measures adopted in potato production to minimize environment impacts: (i) farm manure as the main source of fertilizer is used, pesticides that meet the national scientific and safety regulations for pest control are used to minimize potential damage to soil and water sources; (ii) surface water for irrigation with water-saving irrigation measures are rationally adopted; (iii) FIs in cooperation with BARA and CPMO carry out multiple sample checks for the application of fertilizer and pesticides during production of potato. 35. Zhangluang Qinghe Tree Fruit Development Co. Ltd. and Zhuanglang Jiayou Crop Farming Cooperative used ADB financed Subloans for vegetable production, and Zhuanglang Hongxin Fruit and Vegetable Co. Ltd. used ADB financed Subloan for tree nursery production. All the three Subloans of the above enterprises and cooperatives used the original ESMS. Zhuanglang County Planting Industry Poverty Alleviation and Development Co., Ltd., Zhuanglang County Forestry and Fruit Industry Poverty Alleviation and Development Co., Ltd. used ADB recycled funds to raise and plant seedlings in apple orchards, and completed 2 sets of ESMS.

⚫ The above 4 enterprises and 1 farmer cooperatives undertake the same category of farm operations. The production of fruits, vegetables and tree nursery in Zhuanglang uses the same water source and the application of fertilizer and pesticides is similar, therefore the impact on the environment is similar. Fruit, vegetable and tree nursery production needs suitable amounts of pesticides and chemical fertilizers, but no pesticides gazetted in the List of Banned and Restricted Pesticides (66 type) are used, including Dimethoate and Methamidophos. Chemical fertilizers used are selected from the National 22

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Implementation Standards of Fertilizers. Crop production in Zhuanglang primarily relies on precipitation with supplementary irrigation by surface water, therefore, it does not constitute any water use conflict with other cropping activities, it does not affect the sustainable use of local water resources, it does not generate any waste water. Crop production of the above 4 enterprises and 1 farmer cooperatives is assessed as Category C in general for environment impact. ⚫ Mitigation measures adopted in fruit, vegetable and tree nursery production to minimize environment impacts: (i) the amounts of pesticides and chemical fertilizer application are rationally controlled. In order to ensure that pesticides banned and restricted by the state and WHO will not be used, BARAs, quality inspection bureau, industry and commerce administration and public security bureau implement monthly inspection in spring and fall. Therefore, it can be assured that pesticides in the List of Pesticides Banned and Restricted by the State (66 pesticides) could not enter the market, including Dimethoate and Methamidophos. In the end, pesticides farmers can buy from the market are those comply with relevant regulations, which can minimize potential damage to soil and water source; (ii) surface water for irrigation with water-saving measures is rationally adopted; and (iii) FIs in cooperation with BARA and CPMO carry out multiple sample checks for the application of fertilizer and pesticides during production of potato. Animal farming 36. Zhuanglang Huifeng Pig Production Cooperative used ABD recycled loan for pig production with a holding of 350 pigs, with the original ESMS used.

⚫ The pig raising area does not involve environmentally sensitive area and the construction activities comply with domestic environment assessment requirements of the Classified Administration Catalogue of Environmental Impact Assessments for Construction Projects. The production base is far away from residential area and water course. The treatment of manure, urine and odor complies with the requirements of agricultural production and environment project. Manure and urine are collected as much as possible for fermentation before releasing as organic fertilizer for crop farming. Disease control of pig strictly follows the Regulation of Animal Disease Control of Gansu Province. The method and the amount of chemicals (disinfectants) used are standardized. The overall environment assessment of pig production is categorized as C. ⚫ Mitigation measures adopted to minimize impact on the environment: (i) low noise equipment and process are adopted, timing of construction is strictly controlled, and no noisy equipment is allowed at night time; (ii) pig manure is timely removed for centralized fermentation as organic fertilizer or for sale to

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

fertilizer manufacturer as raw materials; (iii) sanitation of pig sheds is maintained, ventilation and air blowers are installed to regularly exchange air to reduce the possibilities of odor; (iv) disease control is carried out strictly following the Local Standard of Animal Disease Control of Gansu Province; and (v) isolation is established among function zones on the livestock farm. At the same time, FIs in cooperation with BARA, county environment protection bureau and CPMO carry out regular and ad hoc supervision on noise control and manure treatment. The frequency of regular supervision is at least 3-4 times/year. In line with the production cycle, ad hoc sample supervision will be implemented for multiple times. 37. Zhuanglang Xianghong Animal Production Co. Ltd. used ADB recycled fund for layer production with stocking of 1,000 layers, and the original ESMS is used..

⚫ The above activities feature on layer production in sheds. Chicken droppings are transported to crop field as organic fertilizer after treatment. Regardless it is centralized or decentralized chicken farming, disease control and disinfection are strictly implemented in line with the Regulation of Animal Disease Control. In the process of production, the company strictly implements Pollutants Discharge Standard of Livestock and Poultry Production (GB 18596-2001) and the Regulation of Pollution Control of Livestock and Poultry Production (2014). Given the holding of layers, the overall environment assessment is category C. ⚫ Mitigation measures adopted in layer production to minimize impact on the environment: (i) all types of ventilation and feed processing equipment are housed and mufflers are installed on noisy equipment powered by air; (ii) chicken droppings are timely removed for treatment as organic fertilizer for crop farming; (iii) chicken sheds are well ventilated, chicken droppings are timely removed to reduce the possibilities of odor; (iv) disease control is carried out strictly following the Local Standard of Animal Disease Control of Gansu Province; and (v) isolations are established among function zones on the livestock farm. At the same time, FIs in cooperation with BARA, county environment protection bureau and CPMO carry out regular and ad hoc supervision on noise control and manure treatment. The frequency of regular supervision is at least 3-4 times/year. In line with the production cycle, ad hoc sample supervision will be implemented for multiple times. 38. Zhuanglang Xinshengyuan Cattle Industry Co. Ltd. used ADB recycled fund for cattle production. Its holding is 150 cows and the original ESMS is used; Zhuanglang County Aquaculture Industry Poverty Alleviation Development Co., Ltd. used ADB recycled fund for cattle production. Its holding is 130 cows and 1 set of ESMS developed. 24

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

⚫ Cow raising area does not involve environmentally sensitive area and the construction activities comply with domestic environment assessment requirements of the Classified Administration Catalogue of Environmental Impact Assessments for Construction Projects. The base is far away from residential area and water course. The treatment of manure, urine and odor complies with the requirements of agricultural production and environment protection. Manure and urine are collected as much as possible for fermentation treatment before releasing as organic fertilizer for crop farming. Disease control of cattle strictly follows the Regulation of Animal Disease Control of Gansu Province. The method and the amount of chemicals (disinfectants) used are standardized. Given the strict environment and disease control requirements implemented at cattle production base as well as the number of cattle kept by average farmer household, the overall environment assessment of cattle production base is categorized as C. ⚫ Mitigation measures adopted by farmer households of cow production base: (i) low noise equipment and process is adopted, feedstuff processing is carried out in insulated workshops and the time of work is strictly controlled; (ii) cattle manure is timely removed for centralized fermentation as organic fertilizer or for sale to fertilizer manufacturer as raw material; (iii) sanitation of the farming surroundings is well maintained, cattle manure is timely treated to avoid over- piling. The structure of feedstuff has been improved, feedstuff with environment protection features is selected to reduce odor of manure; (iv) disease control is carried out strictly following the Local Standard of Animal Disease Control of Gansu Province; (v) isolation is established among function zones on the livestock farm. At the same time, FIs in cooperation with BARA, county environment protection bureau and CPMO carry out regular and ad hoc supervision over noise control and manure treatment. The frequency of regular supervision is at least 3-4 times/year. In line with the production cycle, ad hoc sample supervision will be implemented for multiple times. Processing and marketing activities 39. Zhuanglang Zhaoyuan Vinegar Co. Ltd. used ADB recycled fund for vinegar production, Zhuanglang Xinhong Garment Factory was financed by ADB recycled fund for poverty reduction workshop for rural women. The Subloans of the two enterprises have used their original ESMS. Zhuanglang County Agricultural Industry Poverty Alleviation and Development Co., Ltd., Zhuanglang Dabeinong Agriculture and Animal Husbandry Technology Co., Ltd. were financed by ADB recycled fund for agricultural production, fruit and vegetable processing and wholesale with 2 sets of ESMS developed.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

⚫ The above-mentioned production process will generate noisy, waste water and solid waste. However, as a result of adopting sound production process and waste treatment process, no negative impact will be produced on the environment.

⚫ Zhuanglang Zhaoyuan Vinegar Co. Ltd. is engaged in vinegar production. It uses grains for edible vinegar production, the solid waste of the production process is vinegar dreg that is used for feed and organic fertilizer production for animal and crop production, and therefore, there is no solid waste in the end. Waste water is from cooling of equipment and cleaning. The enterprise has standardized three- stage sedimentation tanks. Water treated through sedimentation does not contain any hazardous materials and can be used for irrigation. The production facilities of the enterprise are located far away from residential area; their noise will not produce any impact on residents. ⚫ Zhuanglang Xinhong Garment Factory was financed by a Subloan of ADB loan for the establishment of a poverty reduction workshop for rural women, which produces garments for the market. The solid waste of the process is residues of textiles that are recycled by specialized agency; therefore, it will not produce any environment issue. The production process will generate noise, but the production facility is over 500 meters away from residential area, the impact of noise on residents is neglectable. ⚫ Fruit processing and wholesales by other enterprises are similar to the above activities. Because of rational location of the production sites and advanced processing technologies, there is no hazardous materials used in production, and there is no large quantity of solid wastes. ⚫ In general, the impact of the above activities on the environment is neglectable; therefore, the overall environment assessment is category C. ⚫ Mitigation measures: (i) low noise equipment and process are adopted, timing of construction is strictly controlled, and no noisy equipment is allowed at night time; and (ii) waste water and solids of vinegar and soy source production are timely collected for fermentation, and the sludge is used as fertilizer in crop production. 40. Zhuanglang Henghui Packaged Fruit Co. Ltd. used an ADB recycled Subloan for carboard box production, and the original ESMS is used.

⚫ The Company was established in 2011 and located in Zhuanglang Recycled Economy Industrial Park. To the east of the facility is Provincial Highway 304, and orchards are located to the southwest of the factory. There are no nature reserves, cultural heritage, protected area, wetland or important area of biodiversity in the factory. It is located about 1,600 meters away from residential

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

area. All lands belong to the state and were leased to the factory. The total area is 74,670.4 m2 with established structures as one-floor steel framework workshop, light steel framework workshop of 8,000 m2, an office building of steel structure of 4 floors totaling 5,475 m2, one boiler room of 16,190 m2. There is one production line of packaging materials and the annual production capacity is 50 million m2 of carboard box. The Company purchases 5,000 ton of fresh fruits each year. ⚫ The production of carboard box is based on manufactured carboards; it therefore does not involve the production of pulp. Water use during production is primary for equipment cooling, heating and daily life of workers. The amount of annual water use is about 3,000-4,000 m3, which is groundwater and the amount of water use complies with the stipulations of Gansu Water Withdrawal Permit and Water Resource Levy Management Method. It does not produce any impact on water use of local residents, agricultural and ecological purposes. Waste water is mainly from the cooling system of equipment and hard water of heating system and sewage of daily life. The production of hard water from heating boiler is 100 ton each year and it contains inorganic salts but no hazardous materials, posing no threat to the environment. The production of sewage of daily life of workers is about 400 ton each year. The factory has well-established sewage treatment system (three-stage sedimentation tanks) to treat the sewage for agricultural irrigation. ⚫ Solid wastes of the sub-project are residual carboard materials, sub quality products and that of daily life of workers. Carboard residue is collected and sold to the carboard manufacturer (the supplier of the raw materials of the sub-project). Garbage of daily life is centralized and removed by Zhuanglang Environment Sanitation Bureau. ⚫ Gas emission of the sub-project is the exhaust of boiler and GHG of the operation of factory. The boiler of the factory uses natural gas with limited emission and the amount of emission discharge complies with the Emission Discharge Standard of Boilers (GB13271-2014)–table 2 of limits of atmospheric pollutant discharge concentration of new boilers. The discharge of GHG from equipment operation is very limited (roughly 200 m3 each year). The production facility is 1,600 meters away from residential area, the impact of gas emission to local residents and the environment is neglectable. ⚫ The noise of the sub-project is effectively minimized by adopting low-noise equipment and soundproof materials. Furthermore, the factory is far away from residential areas, the impact of noise on local residents is neglectable. The procurement, storage and marketing of fruits do not involve water use, nor produces any waste gas, solid waste and sewage. 27

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

⚫ Given the above, the environment impact of the sub-project is assessed as Category C. ⚫ The land used in the sub-project belongs to the state; it does not involved land acquisition, resettlement, and demolishment of existing structures. The operation of the sub-project does not involve the interest of ethnic minorities and has not negative impact on women. The operation of the sub-project in fact can increase the income of farmers of surrounding villages and provide job opportunities to rural women. As a result, the assessment of social impact is Category C. JRCB 41. In 2019, JRCB disbursed 7 Subloans financed by ADB loan in Jingning and completed 7 sets of ESMS, involving 5 farmer cooperatives and 2 agricultural enterprises; JRCB also used its counterpart fund to have disbursed 9 Subloans in Jingning and completed 9 sets of ESMS, involving 2 bases, 2 farmer cooperatives, and 5 agricultural enterprises. The CPMO and FIs conducted real-time monitoring of the ESMS implementation of 16 Subloans in Jingning County, and the monitoring rate was 100%. During the reporting period, JRCB continued to use ADB recycled funds and counterpart funds to issue loans in Jingning County to support local agricultural production activities. 42. JRCB used ADB recycled fund for the disbursement of 7 Subloans in Jingning in support of purchase and marketing of fruits. The activities involve 1 buying and selling center, 3 cooperatives, 2 companies and 1 family farm. If the borrowers of the Subloans renew the loan and the project activities supported by the ADB recycled fund have not changed, the 7 Subloans financed by ADB recycled fund can continue to use the original ESMS. JRCB also used counterpart funding to disburse 9 Subloans in the county to support purchase and marketing of fruits, which used the original ESMS. These activities involved 5 enterprises, 2 farmer cooperatives and 2 farmer households. The specific content is described as follows:

Crop production

43. Jingning Red Star Family Farm used ADB recycled fund for potato production with the original ESMS used.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

supplementary irrigation by surface water, therefore, potato does not constitute any water use conflict with other cropping activities, it does not affect the sustainable use of local water resources, it does not generate any waste water. Potato production of Zhuanglang Zhengrong Potato Cooperative is assessed as Category C in general for environment impact. ⚫ Mitigation measures adopted in potato production to minimize environment impacts: (i) farm manure as the main source of fertilizer is used, pesticides that meet the national scientific and safety regulations for pest control are used to minimize potential damage to soil and water sources; (ii) surface water for irrigation with water-saving irrigation measures are rationally adopted; (iii) FIs in cooperation with BARA and CPMO carry out multiple sample checks for the application of fertilizer and pesticides during production of potato. Purchase and storage and transportation 44. Jingning Fenghua Fruit Purchase and Marketing Center, Jingning Huimin Fruit Farmer Cooperative, Jingning Kaida Fruit Industry Cooperative, Jingning Zhunong Fruit Co., Ltd. and Gansu Shunyuan Fruit Industry Development Co., Ltd. were supported by Subloans financed by ADB recycled fund with 5 sets of original ESMS used; Jingning Zhiqi Agricultural Products Purchase and Sale Cooperative was supported by Subloans financed by ADB recycled fund with the original ESMS used.

⚫ These activities involve purchase, storage and transportation of apples and other farm products, while the impact on the environment is primarily noise and some wastes, which have neglectable negative impact on the environment. Therefore, they belong to Category C in environment impact assessment. ⚫ Mitigation measure: (i) low noise equipment and process are adopted, timing of construction is strictly controlled, and no noisy equipment is allowed at night time; (ii) wastes resulted from processing and purchase activities are timely removed and treated in centralized manner according to categorization of wastes; (iii) during transportation, all goods are well packed according to the requirements of the regulations of road transportation. Yuzhong SPD Rural Bank

45. In 2019, Yuzhong SPD Rural Bank disbursed 25 Subloans in Yuzhong using ADB loan resources, a total number of 21 sets of ESMS have been completed, involving 2 bases, 1 cooperative and 18 enterprise. Three Subloans financed by ADB loan belong to Category B in terms of environment impact; consequently, 3 sets of IEE were prepared. During the reporting period, in accordance with the three initial environmental reviews (IEEs) formulated in 2019, the Yuzhong SPD together with

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

the CPMO and relevant departments intensified the monitoring and supervision of Category B projects. Recycled ADB loan funds and counterpart funds were used to continue to support the pig breeding activities of Yuzhong Muxin Agriculture and Animal Husbandry Technology Co., Ltd, a Category B sub-project. The original ESMS and initial environmental review (IEE) are used, and all sub-loans are monitored in real time. The monitoring rate is 100 %. 46. During the reporting period, Yuzhong SPD Rural Bank disbursed 9 Subloans in Yuzhong using ADB recycled funds in support of sales of agricultural machinery, fertilizer marketing, vegetable packaging materials, animal production and vegetable production, involving 2 cooperatives, 6 enterprises and 1 farmer household. If borrowers of the Subloans renew the loan and the project activities supported by the ADB recycled fund have not changed, the 9 Subloans financed by ADB recycled fund can continue to use the original 9 sets of ESMS. Among them, Gansu Muxin Agriculture and Animal Husbandry Technology Co., Ltd. used ADB recycled fund of USD 423,800 (EUR 390,000 or CNY 3,000,000) and counterpart funds of USD 162,800 (EUR 149,800 or CNY 1,000,000) for pig production. Therefore, during the reporting period, the Subloans administered by Yuzhong SPD using ADB recycled fund and bank counterpart funds used 9 sets of original ESMS.

Animal production

47. Yuzhong Muxin Agricultural and Animal Husbandry Co. Ltd. established its pig farm in the agricultural demonstration park in Ouziping of Daxingying Village, Sanjiaocheng Township of Yuzhong County. 48. The ADB recycled fund and bank counterpart funds are used to support pig production. The production base is designed in accordance with modern pig production standards in the country and its operation complies with the national standard. The Company has established 122,400 m2 of 20 pig sheds that can house 6,500 pigs, 4,000 m2 feedstuff processing space, 1,400 m2 of office space and disinfection space, and 6,500 pigs are kept at the facility. 49. There might be environment pollution issues during its operation, the sub-project therefore belongs to Category B according to ADB’s environment impact assessment. In line with the requirement of ADB and with the assistance of consultants, IEE and ESMS have been established. The potential impact of pig production on the environment includes manure, dead pigs due to illness, noise, odor

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

and waste water.

⚫ Pig manure and mitigation measures: the treatment method of pig manure of the farm is developed in accordance with the livestock and poultry waste treatment and pollution control method endorsed by the Gansu Provincial Standard and Management Method of Animal Production Park. The manure of livestock and poultry will be treated through natural compositing to remove hazardous matters; ⚫ Dead pigs due to illness and mitigation measures: by far there has been no case of dead pig due to sickness. The disposal of dead pig will follow the guidelines of Yuzhong County Environment Protection Bureau and Yuzhong Animal Production Bureau; ⚫ Noise and mitigation measures: pig sheds are more than 1,000 meters away from residents, the noise of pig farm will have minimum impact on residents; isolation is established around the farm and among functioning zones on the farm. Equipment and process of low noise are used, including mufflers installed at ventilation equipment and blowers and vibrators. Operational procedures are strictly followed to reduce man-made noise. Materials that absorb and isolate sound are used; ⚫ Odor and mitigation measures: odor of the pig farm is primarily from manure, waste water, bedding materials, decomposition of feedstuff, gases of fresh manure and exhaled from digestive system of pig, secretion of glands, as well as dirt attached to pigs. Since the pig farm is located in barren land far away from villagers, there is minimum impact on local residents; however, the pig farm has also adopted corresponding mitigation measures. ⚫ Waste water and mitigation measures: waste water during operation of the pig farm includes those from production and living of workers. There are 35 workers (including 15 female workers) on the farm, who are all local farmers and do not live on the farmer, therefore, there is no waste water from their daily life. Production waste water includes urine and pig shed cleaning. All waste water is piped to manure treatment area where solid matter is removed through filtering, while fluids are discharged to the sedimentation tank for treatment and organic fertilizer production for application on farmland. ⚫ The site of the sub-project is established in the agricultural demonstration park in Ouziping of Daxingying Village, Sanjiaocheng Township of Yuzhong County, which complies with the overall planning of the county and the site is properly selected with rational overall layout. During project implementation, control measures of the noise, odor, and waste pollution are feasible and reliable. The sub-project is therefore feasible from the perspective of environment protection. However, considering the actuality of the sub-project, the PPMO would 31

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

recommend the following: (i) during project design, construction and operation, the system of “three simultaneousness” 1 in environment protection must be strictly implemented to make sure that each type of pollutant is properly controlled and treated to meet the discharge standard and mitigate environment impact; (ii) the enterprise can establish an environment protection unit manned with designated personnel for environment protection; and (iii) regulations and systems of environment protection should be established in order to among others strengthen management and maintenance of equipment and facilities for environment protection and ensure the functionality of such, and make sure long- term and stable compliance with discharge standard. Purchase and storage and transportation 50. Yuzhong Chengguan Supply and Marketing Cooperative, Yuzhong Shunde Green Vegetable Package Material Co. Ltd. are engaged in farm products purchase and marketing using the Subloans financed by ADB recycled funds, with the original ESMS used.

⚫ These activities involve purchase and transportation of farm products and sales of agricultural machinery, while the impact on the environment is primarily noise and some wastes, which have neglectable negative impact on the environment. Therefore, they are classified as Category C in environment impact assessment. ⚫ Mitigation measure: (i) low noise equipment and process are adopted, timing of construction is strictly controlled, and no noisy equipment is allowed at night time; (ii) wastes resulted from processing and purchase activities are timely removed and treated in centralized manner according to categorization of wastes; (iii) during transportation, all goods are well packed according to the requirements of the regulations of road transportation. 51. Yuzhong Heji Agricultural Machinery Co. Ltd used ADB recycled fund to support its agricultural machinery sales with original ESMS used.

⚫ These activities might generate some noise and waste materials, which are temporary and will be mitigated through proper handling of inventories. There will be neglectable negative impact on the environment; therefore, they are classified as Category C in environment impact assessment. ⚫ Mitigation measure: (i) time of operation will be strictly controlled to avoid noise at night; and (ii) timely removal of waste materials for proper disposal in accordance with local regulations and laws.

1 It means environment protection processes and facilities must be designed, constructed and optional at the same of the production processes and facilities. 32

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

52. Yuzhong Jufeng Farm Products Co. Ltd., Lanzhou Xinhao Farm Products Co. Ltd., Lanzhou Luxingyuan Farm Products Co. Ltd., Lanzhou Sanxin Green Food Co. Ltd., Yuzhong Maoyuan Potato Production and Marketing Cooperative, and Yuzhong Yuxiang Farm Products Co. Ltd. accessed Subloans financed by ADB recycled fund for marketing, storage and transportation of vegetables with the original ESMS used. Jiang Yumei, one farmer, accessed a Subloan financed by ADB recycled fund for vegetable marketing, storage and transportation with original ESMS used.

⚫ These activities might generate some noise, waste water and waste materials, which are temporary and would not cause water pollution and water use conflict. There will be neglectable negative impact on the environment; therefore, they are classified as Category C in environment impact assessment. ⚫ Mitigation measure: (i) time of operation will be strictly controlled to avoid noise at night; and (ii) timely removal of waste water and materials for proper disposal in accordance with local regulations and laws. BOL 53. During the reporting period, BOL used bank counterpart fund for the disbursement of 2 Subloans for 1 farmer household in Minxian for purchase, storage and transportation of medicinal herbs, and one set of ESMS completed.

⚫ The 1 Subloans in Minxian are used for purchase, storage and transportation of medicinal herbs, and its impact on the environment is primarily noise and some wastes, which are neglectable, therefore, it is Category C in environment assessment. ⚫ Mitigation measure: (i) low noise equipment and process are adopted, timing of construction is strictly controlled, and no noisy equipment is allowed at night time; (ii) wastes resulted from processing and purchase activities are timely removed and treated in centralized manner according categorization of wastes; (iii) during transportation, all goods are well packed according to the requirements of the regulations of road transportation. ii. Good practices of environment management 54. During the reporting period, there were 215 Subloans (of which, 198 Subloans were financed by recycled ADB loan proceeds and 17 were financed by FIs’ counterpart funding) involved in the establishment or development of agricultural production bases. Extension agents of county agriculture and animal husbandry bureau and the environment managers of the FIs together with the borrowers of the

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Subloans screened sub-projects one by one in accordance with Step B of ESMS and based on sustainable and climate smart crop and animal production technologies, appropriate techniques for sub-projects are identified. During the process, the environment officials of CPMOs and environment consultants provided necessary services. Good practices of environment management include: (i) adoption of dripping irrigation technologies for effective use of water resources; (ii) controlled application of chemicals in quantity and no application of chemicals banned or restricted by the state; (iii) use of organic fertilizers; (iv) adoption of IPM; and (v) maintaining consistency of project livestock production with the standards of livestock farms of Gansu Province. ⚫ Sustainable agricultural development measures: “soil conservation (shallow plough and disc plough) in land leveling”, “IPM” and the “use of organic manure” will reduce the application of chemicals, increase the safety of crops and maintain long-term fertility and sustainability of soil. For animal production activities, the construction of sheep and cattle sheds and feed storage facilities are consistent with the standards of livestock and poultry production parks of Gansu Province. Procurement of livestock and feed from local farmer households brings about economic benefit to local communities. Power saving device is installed on power supply equipment, surrounding landscape of production bases are utilized for cooling. Waste water and gas are collected for biogas production or organic fertilizer production. Disease control is carried out in line with domestic disease control schemes. ⚫ Water and water pollution: all 215 subprojects comply with the stipulations of the Management Method of Water Withdrawal Permit and Water Resource Levy of Gansu Province. There is no water pollution. ⚫ Mitigation measures to cope with potential environment impact: the construction and operation of the subprojects supported during the reporting period involve the use of chemicals (including chemical fertilizers, pesticides and diesel), noise and dust during transportation, processing and storage. Mitigation measures are: (i) chemicals (including chemical fertilizers, pesticides and diesel): pesticides and chemical fertilizers banned or restricted by the state will not be used; low residue and low toxic chemicals will be used for chemical control; supervision will be strengthened for the application of chemicals; entities will be supervised by PMO and other relevant agencies for the application of chemicals in the production base; (ii) noise, dust and pollution during transportation, processing and storage: raw materials will be covered during transportation and piling to reduce dust, construction waste will be used to fill in low-lying areas of farm as foundation of other structures, construction wastes will be properly treated. 34

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Hazardous wastes will be collected for centralized treatment and will not be discarded at wish; timely clean on-site droppings of dirt and spray water to eliminate dust; construction site will be fenced by solid panels to reduce noise and dust pollution. 55. The CPMOs, FIs, County Agriculture and Animal Husbandry Bureau and Environment Protection Bureau of project counties implement monitoring and evaluation of sustainable agricultural practices and environment impact mitigation measures.

⚫ Sustainable agricultural development measures: CPMO, FI and the Animal Epidemic Disease Surveillance Station of the Animal Husbandry Bureau affiliated to the County Agriculture and Animal Husbandry Bureau supervise manure treatment measures of enterprises through regular and ad hoc inspection in general.The frequency of inspection for crop production sub-projects is twice a year and it is once a quarter for animal production sub-projects. Ad hoc inspection bases on sampling at any time. These missions aim to provide technical and skill guidance and training to rectify the noncompliant measures. ⚫ Water and water pollution: CPMO, FI and the county Environment Protection Bureau supervise the amount of water use, waste water discharge and water pollution in general, which is implemented twice a year. Any noncompliance will be pointed out and rectification opinions will be offered. Once the supervision is completed, a monitoring report will be developed for submission to the PPMO and relevant leadership at county level. ⚫ Mitigation measures to possible environment impact: CPMO, FI and the Inspection Station of the county Agriculture and Animal Husbandry Bureau supervise the entities twice a year in general, which is both regular and ad hoc, and regular supervision is scheduled at spring and fall while ad hoc supervision is based sampling at any time. Technical and skill guidance and training will be provided to rectify the noncompliant measures. 56. During June 25-27, 2019, ADB fielded a mid-term review mission to the Gansu, during which, the environment specialist attended briefings of the PPMO on issues related to environment safeguard and confirmed the practices of ESMS implementation. In line with the feedback of the specialist, PMOs further stepped up efforts in environment M&E for activities related animal production. Also, with practices of 5 years, ESMS has been integrated with the daily business of FIs and most of them can carry out ESMS related works without further support of ADB.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

C. Social safeguard 57. In line with ESMS requirements, assessment and inspection should be carried out to find out the social impact of sub-projects on the neighboring communities and the public, including land acquisition, involuntary settlement, ethnic minority and land use right transfer. Land acquisition and involuntary settlement 58. During the reporting period, all sub-projects supported by all Subloans do not involve issues of land acquisition and involuntary settlement as defined in ADB’s Safeguard Policy Statement and the ESMS of the project; and there is no residential relocation and economic losses caused by land acquisition or involuntary resettlement. It is therefore Category C for involuntary settlement. Land use right transfer 59. In recent years, Gansu has carried out reforms of “converting resources to equity, converting capital to share and converting farmers to shareholders” (hereafter refers to as three conversions) under the precondition of maintaining collective ownership of land and minimum arable land area, of benefiting farmers. During the reporting period, there were 215 Subloans in which farmers used their contracted land as shares to join agricultural enterprises and farmer cooperatives to benefit from value chain development. These activities do not involve land use right transfer and the format of land use right transfer agreement is no longer used, therefore, these did not trigger the requirement of land use right transfer framework agreed by ADB and the government. Field study indicated that in the project of converting land to shares, there were no pending issues to be addressed. 60. The change of farmers to shareholders refers to farmers who voluntarily use the land contract management rights to invest in leading enterprises and farmers’ cooperatives and other new farmers’ operating entities after negotiation or discounts, and enjoy the rights of shares. After the two parties sign the land share contract, leading enterprises and farmers’ cooperatives Other business entities pay dividends to farmers in accordance with the contract. 61. According to ESMS requirements, relevant CPMOs and FIs shall review and verify the land use rights transfer contracts involved in the subprojects. With the assistance of the social officials and consultants of the project office and with referrence to the land transfer framework, FIs conducted due diligence on land use rights transfer involved to find out the land transfer process, the content and implementation of the land use rights transfer contract, and the scope and the number 36

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

of people impacted by land use rights transfer, the price and payment method, rights protection measures, etc. Up to now, the project has involved 1,454 transfer agreements, of which 1,339 were land use rights transfer agreements signed by women, accounting for 92.09% of the total amount of agreements, which fully complies with the ADB’s requirement that "at least 70% of land transfer agreements are signed by women". In accordance with the changes in national policies, Gansu Province has implemented the three transformations reform as "transforming resources to equity, capital to equity, and farmers to shareholders" (hereinafter referred to as "resources to equity, capital to equity, and farmers to shareholders") on the premise that the public ownership of land remains unchanged, the red line of cultivated land is not broken, and the interests of farmers are not damaged. Therefore, starting from 2017, farmers gradually took the contracted land management rights into new farmer management entities such as leading agricultural industrialization enterprises and farmers’ cooperatives, sharing the value-added benefits of the industrial chain, and the form of land transfer agreements is no longer adopted, subsequently, land use rights transfer is no longer involved in the project.

Ethnic Minority 62. In line with the Ethnic Minority Development Framework, the assessment of the impact on minorities needs to consider the impacts the project brings about to them and the vulnerability of the minority communities. In accordance with the Safeguard Policy Statement of ADB and the stipulations of ESMS, all sub-project activities supported through ADB recycled Subloans do not involve any issue of ethnic minority. Using the rapid assessment checklist of impacts on ethnic minority, it is concluded that all sub-products belong Category C in terms of impact on ethnic minority (no need for monitoring). 63. Against the monitoring indicators of EMDP and SGAP, project implementation not only pays sufficient attention to ethnic minorities, women and the poor through its Subloans, but also focuses on capacity building of these groups. During the reporting period, all subloans under FI model do not involve ethnic minority population, but 11,224 women and 2,675 poor. However, Hezheng, Jishishan and Yongjing CPMOs under the non-FI model supported Hui, Bao’an, Dongxiang and Sala ethnic minority residents for the establishment of 3 farmer cooperatives and 5 agricultural production bases, through procurement of agro-machineries, farm production inputs and office equipment for the entities, assistance in market promotion as well as capacity building for the management and members of the

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

cooperatives. While delivering capacity building activities to the management of agro-enterprises, farmer households of production base, large households, disease control workers, technicians of crop and animal production, particular efforts are given to capacity building of ethnic minorities and women. During the reporting period, the 3 CPMOs trained 671 ethnic minority women, accounting for 58.6% of a total number of 1146 ethnic population. During the construction and production of production bases, agro-enterprise and cooperatives, 606 women and 353 ethnic minority women participated in activities, accounting respectively for 59.2% and 58.3% of the total number of labor force of 1,023. Training is provided to 388 ethnic minority women, accounting for 45.9% of 846ethnic minority workforce trained. 64. The project involves the Hui, Dongxiang, Baoan, and Sala in Hezheng, Jishishan and Yongjing counties, which is consistent with the social inclusive development of the ADB policy. Therefore, in order to expand the positive impact of the project on ethnic minorities and reduce the possible negative impact, the project has prepared the Ethnic Minority Development Plan (EADP). The specific performance is as follows: ⚫ Promoting the development of ethnic minority villagers. Using ADB loan funds to establishe farmer cooperatives and production bases with ethnic minority villagers as their leaders progressed well. By far, 50 cooperatives and 11 bases have been developed. By providing employment to surrounding ethnic minority villagers and purchasing agricultural products from them, nearly 100 households with 3,759 people have benefitted from the project with increased income. ⚫ Improving the development capabilities of ethnic minority villagers. The three CPMOs used ADB funds under the traditional model, combined with matching funds, to provide training to 2003 ethnic minority villagers, inlcuding 1,007 ethnic minority women trained, accounting for 50.3%; during 4 years, 7,537 ethnic minority laborers were trained and the number of women is 2,831, accounting for 37.6%. Both in terms of the number of training and the proportion of women, they far exceed the SGAP requirement of “training 1,000 ethnic minority laborers in 5 years, of which 25% are women.” ⚫ Increase labor opportunities for ethnic minority villagers. According to statistics, the total number of people who participated in labor during the production and construction of the project was 4,683, of which 2,074 were women who participated, and 1,097 were women from ethnic minorities, accounting for 44.3% and 52.9%, meeting the threshold of “women's participation during the production and the construction of the base, agribusiness 38

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

and cooperative should be no less 30%, of which minority women would be no less than 35%”.

D. Social and gender 65. During the reporting period, PMOs implemented over 28 sessions of capacity building activities targeting at PMO staffers, responsible persons and staffers of FIs, responsible officials of BARA and Environment Protection Bureau, the management of cooperatives and agricultural enterprises, farmer households of production bases, large households of crop and animal production, disease control workers and technicians of agriculture and animal husbandry administration. Contents of capacity building included interpretation of ADB policies, basics of the project, ESMS related knowledge, standardized management of cooperatives, agricultural industrialization technologies, farm input marketing and management, skills for women, introduction and demonstration of new varieties, medicinal herb cultivation, vegetable production technologies, potato high-yielding cultivation, fruit tree pruning, pest management, animal disease control, standardized scale production of animals, safe application of pesticides, new pesticides and biological fertilizers, safety of agricultural products, recycled use of plastic mulch, harmless treatment of waste and its use as resource, and the development of e-commerce platform. In addition, in order to broaden the vision of project implementers and learn the experiences of developed areas in developing featured agriculture and rural financing, PMOs organized study tours to other provinces to learn the development of featured agriculture and promotion of agricultural products of the project (Refer to details in Appendix 5 of Capacity Building Statistics). 66. In line with the objectives of “establishing inclusive and environment friendly featured agricultural production bases”, the PPMO and CPMOs, during the reporting period, provided training to 5,064 farmers, of which, poverty population made up 4,108, accounting for 81.12%. The total number of beneficiaries of the construction of the base is 763, of which, poverty population made up 602, accounting for 78.90%. Based on the objective of “supporting the development of farmer cooperatives and agricultural enterprises”, the PPMO and CPMOs have provided training to 634 farmers, of which, poverty population made up 0, accounting for 0. 2020 is a key year for poverty alleviation in Gansu Province. While training farmers, PMOs have combined the work of precision poverty alleviation to increase training for poverty population.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

67. During the reporting period, in line with the objectives of “establishing inclusive and environment friendly featured agricultural production bases”, the PPMO and CPMOs have provided training to 5,064 farmers, of which, women made up 2,464 accounting for 48.66%; trained 597 technicians including 259 women, accounting for 43.38%. Based on the objective of “supporting the development of farmer cooperatives and agricultural enterprises”, the PPMO and CPMOs have provided training to 634 farmers, of which, women made up 384 accounting for 60.57%; trained 302 technicians including 218 women, accounting for 72.19%. During the training process, according to the performance goals in the SGAP, in order to make the project performance indicators closer to the goals, PMOs paid more attention to the proportion of women participating in training. Under output 1 and output 2, the number of trained technicians is higher than the SGAP requirement, which includes village-level farmer technicians (including crop technicians, forestry technicians, water technicians, fishery technicians, animal epidemic prevention workers, and agricultural machinery technicians). 68. Such training enabled more and more poor and women to access training and education, hence helped poor women build up their own capacity for development and for resisting risks, and mobilize their enthusiasm and initiative to participate in project and poverty reduction activities. In the end, it will promote their participation in social and economic activities. 69. There are all together 149 farmer households obtained loans during the reporting period under outputs 1 and 2, of which, 149 loans were also signed by women, accounting for 100.00%. Participation in loan activities enabled rural women to due respect and equality. They also realize their rights and value through credit activities and project implementation. 70. During the reporting period, 546 staffers of the new FIs participated in training organized by the PPMO, including 228 women staffers, accounting for 41.76%. Seven staffers from RFSP also participated in training, including 4 women staffers or 57.14%. Training focused on the basics, important practices and features of the project, priority work in the coming months, the establishment and implementation of ESMS, due diligence report of land use right transfer, the preparation of IEE and EES. 71. The PPMO and CPMOs in staffing also attached attention to gender and increased the number of women staff. For instance, the PPMO has 9 staffers, women accounted for 4 or 44%; the total number of staffers of CPMOs are 103 including 49 40

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

women or 47.57%; both of which are higher than ADB’s requirement that “women staffers should be no less than 35%.” 72. Meanwhile, the PPMO and CPMOs in training related to project management and implementation and ESMS also aim at meeting the requirements of increasing women’s participation. During the reporting period, the PPMO trained 9 staffers including 4 women staffers or 44%; among the 22 CPMO staffers received training, women were 10 or 45.45%, which are higher than ADB’s benchmark that “the participation of women PMO staffers in training in project management, financial management and the implementation of ESMS/EMDP/ SGAP/M&E should be no less than 35%.” ⚫ By implementing social inclusive development in the project, it will bring benefits to ethnic minorities, women and the poor. In order to ensure that prominent social and gender issues during the project implementation period are properly resolved, the project has prepared a "Social and Gender Action Plan" (SGAP). Based on the various monitoring indicators in it, regular social and gender activities during project implementation are carried out. According to statistics, as of now, 27,866 farmers have participated in various training under the project, including 12,037 women and 21,617 poor. The proportion of female technicians trained in the development of the base was 36.18%, and the proportion of the poor among the beneficiaries was 46.70%, all meeting the requirement of 30%. PPMO and CPMOs used supporting funds to provide training for cooperatives and enterprise members. 11,208 people received training, far exceeding the requirement of 6,510 members. Among them, 5,476 female members received training, accounting for 48.86%, and the poor was 5,395, accounting for 48.14%. It also provided job opportunities for 3,438 female employees and 3,143 poor in cooperatives and enterprises, accounting for 45.32% and 41.43% of the total number of new employees of 7,586. ⚫ The social and gender issues of FIs are also the focus of the project. In SGAP, there are two contents concerning the social and gender issues of FIs. One is “270 FI employees and 35 RFSP employees participated in the training, of which 30% were women.” PMOs and FIs have provided ESMS training to 2,288 FI employees and 25 RFSP employees, among them, there are 926 and 16 female employees, accounting for 40.47% and 64.00%, respectively. All met the 30% requirement. The second is to “establish at least 29 primary financial service outlets, 30% of which are female employees, and all female employees have participated in training.” Six FIs have established 170 primary-level financial service outlets with a total of 1,728 employees, of which 690 are female employees, and the number of female employees participating in 41

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

training is 516, and the proportion of female employees is 39.93%. ⚫ According to the needs of the project, 13 CPMO have been established in 13 project counties, and they are operating well. There are 108 staff members, including 51 female staff, accounting for 47.22%; the PPMO currently has 11 staffers including 6 female staff, accounting for 54.55%. The female staffs in the PMOs have all reached the 30% requirement. A total of 128 person-times of project offices at all levels participated in training in project management and implementation of ESMS/EMDP/SGAP/M&E. Among them, 61 women participated in the training, accounting for 47.66%, which exceeded the target that “at least 35% of female staffers” at all levels participated in the training.

Prohibited investment activities 73. During the reporting period, all funds of all Subloans including working capital and counterpart funding were not used to support any prohibited activities listed in annex 5 of ADB’s Safeguard Policy Statement.

E. Information disclosure 74. FIs disclosed the basic information at the implementation site for each sub- project supported by each Subloan, including the location, activity, potential impact, end borrower and FI as well as the contact details of the environment and social officials of the CPMOs, and grievance redressing mechanism. Such disclosures are posted pubic bulletin boards of townships, villages and FIs as well as eye-catching location at the project implementation site. The duration of disclosure is for 10 days to ensure that the public has adequate time to provide writing or oral feedback to the CPMOs. F. Progress of implementing grievance redressing mechanism 75. In line with the circular “On Establishing Grievance Redressing Mechanism of Gansu Featured Agriculture and Financial Service System Development Project Co- Financed by ADB” (GWZBH [2016] No. 15) issued by the PPMO as well as the stipulations of ADB on grievance redressing, all 13 project counties have set up their own grievance redressing mechanisms, FIs in support of the counties also established grievance redressing channels to ensure that the population that might be affected by the project can at any time file complaints on issues related to the environment and social aspects during project implementation. This also enabled

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

timely handling of grievances and appeals of the affected groups to effectively protect the rights and interests of the residents of the project area. The mechanism has been disclosed at prominent locations in project counties, townships and villages in a way that the affected groups and other stakeholders particularly minorities, women, the poor and those who cannot read can understand. Such efforts are meant to make sure that the affected and stakeholders know and are familiar with the contents of grievance redressing mechanism and file their grievances through the ways prescribed in the mechanism. With specific steps given below: 76. If appeals or complaints are related to the environment, the following two steps will be adopted to timely handle the complaints or grievance of the affected:

⚫ Step 1 (within 10 days): the affected individual or group can file oral or written complaints to any project agency and any other agency the complainer (s) chooses. The project agencies will directly interact with the complainer to resolve the issues. Within five days upon receipt of the complaint, the project agency will propose explicit suggestions to the affected, including the correctional measures to address the problem(s) with given time limit. If the affected person(s) accepts the correctional measures, such measures will be implemented within five days.

⚫ Step 2 (within 10 days): when the issue is not resolved through step 1, CPMO within five days upon receipt of the complaint will convene stakeholder meeting (participants will be determined in accordance with the actual situation, but normally include FI, RFSP, end borrower, environment protection bureau, agriculture and rural affairs bureau and the affected group), which will focus on the correctional measures and the associated timetable for implementation. Such correctional measures shall be implemented within five days. 77. If appeals or complaints are related to the land use right transfer, the following four steps will be adopted to timely handle the complaints or grievance of the affected: ⚫ Step 1 (within 15 days): hand the grievance to the villagers’ committee. If it is oral grievance, the villagers’ committee will make written records and the committee will make a decision and well handle the issue within 15 days.

⚫ Step 2 (within 15 days): if the affected is not content with the result of Step 1, the complainer(s) can appeal to the township agricultural economic management station (or township government). The agricultural economic management station or township government will make a decision and resolve the issue within 15 days.

⚫ Step 3 (within 15 days): if the affected is not content with the results of Step 2, 43

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

the complainer(s) can appeal to the county agriculture and rural affairs bureau and CPMO, the later will make a decision and resolve the issue within 15 days.

⚫ Step 4 (no time limit): if the affected is not content with the results of Step 3, the complainer(s) can appeal to the arbitration court of rural land disputes. 78. If appeals or complaints are related to ethnic minority, the following four steps will be adopted to timely handle the complaints or grievances of the affected:

⚫ Step 1: if the affected is not content with the EMDP or this project, he/she or they can log oral or written grievance to the villagers’ commitment or cultural leader. If it is oral grievance, the villagers’ committee or cultural leaders shall handle the case and make corresponding records, and the issue should be resolved within 15 days.

⚫ Step 2: if the affected is not content with the result of Step 1, the complainer (2) can appeal to the township government, and the later will make a decision and resolve the issue within 15 days.

⚫ Step 3: if the affected is not content with the results of Step 2, the complainer(s) can appeal to the CPMO, the later will make a decision and resolve the issue within 30 days.

⚫ Step 4: if the affected is not content with the results of the above steps, the complainer(s) can appeal to relevant government bureaus applying for administrative reconsideration. 79. The PPMO has never ignored the use of new technologies to uplift project management and service. In order to ensure the timeliness and effectiveness of receiving complaints, discovering issues and handling grievances, the PPMO in its MIS established grievance redressing mechanism, the CPMOs and the branches of the FIs would record writing and oral complaints to the project as well as the results of handling, while the PPMO would track and monitor the process and visit the complaint filers. From manual recording to on-line sharing platform recording, it not only realized data sharing through the net, but also improved the timeliness of grievance redressing, which resulted higher efficiency, standardization, transparency and smoother management of the process. 80. By the end of the reporting period, the 13 project counties and the HQs and branches of FIs had not received any forms of appeals or complaints. G. Application of MIS system in ESMS 81. In line with the FIs’ ESMS approved by ADB and the objectives and

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

requirements of the project, national consultants in consideration of organizational features and business process of rural financial service providers developed simplified ESMS template, which is the foundation for adoption by all RFSPs. The PPMO submitted the template to ADB on July 26, 2017. On the basis of feedback from ADB’s environment and social specialist, the PPMO improved the template and obtained no-objection from ADB on September 1, 2017. 82. During the reporting period, the PPMO has been proactively promoting the implementation of RFSP under Output 3 and an eligible RFSP implementer has been identified in Lintao. The PPMO and consultants assisted the implementer prepare simplified ESMS suitable to the operation of the implementer, which will be submitted to ADB for approval. Technical training has been provided to the ESMS staffers of the identified RFSP implementer. 83. During the reporting period, PMOs at all levels and branches of FIs can skilfully use the information platform to record and manage sub-project activities. When difficulties encountered in practice, real-time QQ group chat renders a helping hand to discuss and share experiences and the software engineers are ready to respond to issues in a timely fashion. Meanwhile, improvement of the MIS is a continuous process. With the active participation and collaboration of PMOs and FIs, monitoring indicators of ESMS and the extraction of data source have been further optimized; also, the output of appendixes of the safeguard monitoring report and the reporting template have been improved. 84. The roll-out of MIS has greatly enhanced the tracking, management, monitoring and reporting procedures of sub-projects, it not only standardized project management process and increased efficiency, but also lower energy consumption of offices and promote green office work. The interactive and convenient QQ group chat for MIS complies with the requirement of information age, it not only can respond to various difficulties and problems encountered in operation, but also pool together good ideas and thoughts for further improving the system and solutions. It helps timely exchange and cooperation between project management and implementers, enhances communication among staffers of PMOs and FIs, indirectly achieves training effects and furthers the understanding of project staffers to issues related to environment and social safeguard of the project. 85. MIS as a project management system, the end users do not have the authority to browse the loan information, and users are limited to the project management and financial management staffers of the PPMO, CPMO and FIs. 45

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

III. EFFECTIVENESS AND IMPACT OF PROJECT ENVIRONMENTAL MONITORING 86. Through establishing and implementing ESMS in the project, 6 FIs use ESMS to manage the possible environmental and social impacts of their loan activities. After more than 4 years of application, ESMS has produced certain effects and influences in environmental protection of project activities, providing a theoretical basis for the sustainable development of agricultural production in the project area. The specific performance is as follows: ⚫ Establishment and implementation of ESMS. Since launch of the project in June 2016, six FIs have established and implemented ESMS. Among the more than 2,300 sub-loans issued to the end borrowers using ADB loan, recycled ADB loan funds and bank counterpart funds, more than 380 ESMSs have been developed for various Subloan activities, covering planting, animal production, purchasing and processing, transportation and warehousing activities. In the project implementation process, each sub-project carries out project activities in accordance with the environmental requirements in the corresponding ESMS. ⚫ Development of mitigation measures. Mitigation measures have been formulated for the environmental impact of each sub-project activity. According to different project activities, through the principle of "prevention first", the environmental deficiencies of some category C projects, such as acquisition and processing, transportation and storage projects, are eliminated; by limiting and restricting the scale, intensity or scope of some category C subprojects, environmental impacts are minimized, such as planting and small-scale animal production projects; through the mitigation measures listed in the IEE, the adverse environmental impacts of Category B projects are reduced or repaired or remediated, such as environmental category B projects. ⚫ Broadening the coverage and uplifting the impact. As an innovative project of similar ADB projects in China, while adopting the innovative model of financial intermediary loans (FIL) in the project, it also introduces a new concept of environmental protection in agricultural activities supported by foreign loan projects. During the implementation of the project, through continuous ESMS training, field research, information disclosure and other activities, the environmental protection awareness of CPM staff, FI staff and agricultural producers in the project area has been improved. Environmental awareness is spreading to groups outside the project, and its impact is increasing.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

IV. PROBLEMS ENCOUNTERED IN ESMS IMPLEMENGTATION AND SOLUTIONS A.Issues 87. In 2019, after the introduction of three new FIs, all six FIs realized that integrating ESMS into their business can not only effectively reduce the banks' environmental risks, but also promote the development of green finance for banks. However, the project will need to continue to learn as it is an innovative agriculture and financing project in China implemented by ADB to create enabling environment for its sustainability. 88. During the reporting period, major challenges faced by the FIs in implementation are largely: (i) external: most of the end borrowers of Subloans have deviated understanding about the ADB loan project that is perceived as government loan with low interest rate; (ii) internal: it is the first time for the three new FI environment and social managers to implement ADB project and their capacity and inner ability need further improvement. 89. Major problems FIs encountered in implementing ESMS include: (i) even though FIs have embedded ESMS into its credit business, but the integration of the two is yet to be fully achieved. On one hand, FIs have inadequate understanding about environment and social risks, and the grassroots credit officials need to further improve knowledge, experience and capacity on ESMS. On the other hand, grassroots client managers of FIs in the real world perceive the assessment and monitoring of ESMS as an extra layer of work that prolongs the assessment of credit business; (ii) the turnover of staffers of FI branches is significant, even though timely training has been provided, it still imposes challenges to the continuity and stability of implementing ESMS; (iii) the project requires end borrowers to provide large amount of information, and the end borrowers could not accurately understand and elaborate on issues related to ESMS assessment of the sub-project, it needs multiple and repeated confirmation of the environment manager and social manager, with high costs of communication; and (iv) some borrowers did not fully consider mitigation measures to environment impact when categorization and assessment is carried out on-site, which need to be addressed by FIs, CPMOs and the borrower. B. Solution 90. Given the above issues, the following actions have been taken: (i) two consultants led a strong team to provide technical services to FIs. During the

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

reporting period, the consultant team fully participated in the development and implementation of ESMS of the three new FIs, as well as the preparation of simplified ESMS of RFSP implementer; (ii) the PPMO strengthened its supervision and technical support to counties, FIs and borrowers, including 14 field visits to project counties totaling 54 man/day; (iii) in order to reduce turnover of FI staffers, the PPMO repeatedly requested FIs to maintain stability of staffers engaged in ADB project activities. Capacity building activities have been delivered to an extended audience of FIs to prepare them for integration of ESMS into FIs lending activities. During the reporting period, client representatives of 4 FIs participated in 5 rounds of training, which also offset to some extent the impact of staff turnover; and (iv) consultants supported FIs in comprehending, accepting and adopting ESMS in their lending activities, which will contribute to the achievement of green financing of the FIs in the future. 91. Given the challenges faced by FIs in implementing activities related to ESMS, the following measures should be considered: (i) coordinated efforts of multiple sectors will be needed to address the difficulties of guarantee of clients and actively explore alternative guarantees in addition to the regular collateral measures, such as agricultural production facility, forest rights and land use right transfer and operation as collateral, joint guarantee and mutual guarantee. Under the conditions of meeting the terms of lending of FIs, the threshold of guarantee of clients should be lowered as much as possible; (ii) breakthrough should be sought for microcredit of farmer households to effectively address the issues of insufficient collateral; (iii) communication with end borrowers should be strengthened in order to repeatedly verify related issues and make sure that there are accurate answers to related questions of the project; (iv) end borrowers will be required to provide comprehensive mitigation measures to environment impacts, technicians of PMOs will manage and guide the borrowers in environment and social management aspects: and (v) communication and cooperation with CPMOs should be enhanced through increasing the frequency of coordination and exchange so as to streamline project management procedures. 92. The PPMO will urge the CPMOs and FIs to strengthen and increase the frequency of supervision through regular reporting, regular supervision and monitoring to ensure that various environment and social safeguard measures and policies are implemented and that ESMS plays its due role. Also, efforts should be made to enable stakeholders of the project including agricultural and animal

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

husbandry administration, client managers of FIs and operators of agricultural production and marketing to play more active role in protecting vulnerable groups and the environment. V. LESSONS LEARNT AND NEXT STEPS A. Lessons learnt 93. In the process of project implementation, FIs’ learning and accepting the systematic rationales of ADB’s ESMS for the project is conducive to increased attention to environment and social aspects in handling FIs credit business and to enhanced focus on gender equality, so that FIs will support agricultural development, promote the development of rural financing service system and generate momentum for advancing the development of agriculture, rural areas and farmers. 94. Agricultural technical support should be rendered to assist improve project design. In line with the requirements of step 2 of ESME, agricultural technicians should provide relevant technical backstopping to borrowers of Subloans to better incorporate good environment practices into their proposals to boost environment and social effects of sub-projects. At the same time, the good practices emerged in the second step of promoting the development of sustainable agriculture and climate smart agriculture are of good value for popularization in other agricultural production areas beyond the project. Specifics include water resource use, collection of plastic mulch, construction of livestock shelters and disinfection facilities, manure treatment, soil conservation, pest management, feeding techniques and disease control. 95. Training should be implemented to increase the capacity for implementing ESMS. For project counties and FIs, ESMS is a brand new area that requires new knowledge, it would take some time for staffers to learn and independently apply ESMS in their daily business. The project management through training, meeting, on-site supervision and workshops has made great efforts to help staffers of CPMOs and FIs accurately understand ESMS operation flow, standards and management and control models to enhance their capacity of green financing business. Also, the management has been assisting FIs further understand environment and social risks and increase their consciousness and capacity of fulfilling environment and social responsibilities. On the other hand, continuous training, information dissemination and technical support will be needed to increase the awareness of agricultural production and marketing operators about environment and social safeguard.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

96. During project implementation, the government will continue to play proactive role in the process of implementing ESMS by the FIs. Through project implementation, efforts will be made to push FIs to incorporate environment and social management into their strategic planning, guide FIs to conduct green financing businesses associated with agricultural production operators. In their investment and financing decision-making, FIs should consider the potential environment and social impact and effect of agriculture-related micro clients, and incorporate the potential return, risks and costs related to environment and social conditions into FIs’ daily business process. At the same time of caring about their own development, FIs should actively shoulder environment and social responsibility and promote green development of agriculture. 97. As for FIs are concerned, ESMS helped address issues such as how to incorporate environment and social elements into their strategic planning and business process, how to carry out environment and social assessment and management in agriculture, and how to balance pursuit of profit and discharging social responsibilities. For the government, ESMS responded to its concern as how to promote financial institutions to gradually establish green evaluation mechanism, how to guide green financing business in agriculture, how to shift roles to allow the market fully play its role in promoting green development of agriculture. 98. ESMS is very practical, experiences accumulated by the project from green financing system arrangement, innovative green financing products and business model to the sustainable development of green financing could be replicated and scaled up in broader area. B. Next steps 99. Continuous tracking the use of ESMS of Subloans and promoting advancement of the project: FIs will continue to disburse recycled ADB Subloans to eligible agro- enterprises, cooperatives and farmer households in accordance with the changes of lending conditions. Each FI of project counties will continue to track, monitor and report on all sub-loans in accordance with the implementation steps of their respective ESMS, and urge the end borrower to apply ESMS to the project implementation process to make the project activities sustainable. 100. Strengthening capacity building particularly for environment and social managers and officials: in future project implementation, training should be intensified to stakeholders particularly staffers of CPMOs, FIs and RFSP in applying

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

ESMS steps for screening, identification and post-lending management of sub- projects and ensuring the integration of ESMS in FIs business operations. These efforts will improve their execution capacity of business as well as their understanding and management capacity of ESMS. 101. Strengthening information dissemination and training: efforts will be continued to sensitize staffers of CPMOs, grassroots staffers of the existing FIs and all staffers of the new FIs as well as RFSP implementer about the entirety of the project, its ESMS, ADB’s management requirements and annual plan. 102. Increase of the frequency and strength of supervision: PMOs at all levels and FI branches should make extra efforts to increase the frequency and strength of supervision through regular reporting procedures, regular supervision, monitoring and evaluation. Monitoring, supervision and evaluation of ESMS implementation should also be intensified to ensure that all environment and social safeguard policies and measures are genuinely executed.

103. Project activity adjustment and document amendaments. In the second half of 2020, it is planned to make adjustments to some of the ADB fund reimbursement categories: (i) all RFSP credit funds under loan category 1C will be transferred to loan category 1B; (ii) balance of the reserved commitment fees and interest under loan category 3 that cannot be used during the loan implementation period will be adjusted to loan category 1B, and the corresponding loan document needs to be amended. 104. EURO imprest account. After the project loan currency is converted from U.S. dollars to Euros, the PPMO will apply to the MOF through the DOF to open a Euro Imprest Account. At present, the opening of the Euro Imprest Account is proceeding in an orderly manner. 105. Safeguard monitoring. In accordance with the requirements of SPS and ESMS as well as EMDP and SGAP, PMOs will continue to monitor all indicators and make sure all M&E indicators are covered by project completion. 106. ESMS sustainable development. The PPMO will continue to monitor the implementation of ESMS, particularly the integration of ESMS in FIs’ businesses. FIs would be able to judge, assess and manage potential environment and social impact when an investment is being considered. The project advocates that FIs should perform due diligence for environment and social issues related to lending activities, as such FIs should shoulder their social responsibilities. Financing can be

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

a good leverage to environment protection and coordinated development of the society, which will contribute to the sustainability of ESMS.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 1: SOCIAL AND GENDER ACTION PLAN MONITORING

(Reporting period: January 1 – June 30, 2020)

Output Social and gender output activities Accumulative January 1 – June 30, 2020

1a. Training of 14,130 farmers, 50% of participants are women and 30% of participants are poor

－ total number of farmers trained 27,866 5,064

－ women farmers trained 12,037 2,464

－ poor farmers trained 21,617 4,108

－ proportion of women 43.20% 48.66%

－ proportion of poor 77.57% 81.12%

1b. Training of 450 technicians, 30% are female, 30% of beneficiaries of production base development is poor

－ Technicians trained 5,843 597

－ women technicians trained 2,114 259

－ total number of beneficiaries of base development 36,887 763

－ number of poor beneficiaries of base development 17,227 602 Output 1: Inclusive and － Proportion of women technicians training 36.18% 43.38% environmenta lly-friendly － Proportion of poor beneficiaries 46.70% 78.90% featured agricultural production bases developed 1c. Women’s equal access to project sub-loans，50% of loans from the FIs to individual farmer household with women’s signature

－ HH got Subloans 3,098 149

－ HH Subloans signed by women 2,949 149

－ Proportion (%) 95.19% 100.00%

1d. Women’s signature on land use rights transfer agreement，70% land use rights transfer agreement signed during the project implementation period with women’s signatures

－ Total number of land use right transfer contracts 1,454 1,000

－ Contracts signed by women 1,339 1,000

－ Proportion (%) 92.09% 100.00%

1e. At least 50 staffers participate in soil and water conservation monitoring, of which, women should be no less than 30%

－ Total participants 173 22

－ Women participants 77 11

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Output Social and gender output activities Accumulative January 1 – June 30, 2020

－ Proportion (%) 44.51% 50.00%

2a. Training of 6,510 members, 50% of participants are women and 30% for the poor

－ Farmers trained 11,208 634

－ Women farmers trained 5,476 384

－ Poor farmers trained 5,395 0

－ Women proportion (%) 48.86% 60.57%

－ Poor proportion (%) 48.14% 0.00%

Output 2: 2b. Training of 868 technicians and managers, 30% are technicians are females Farmer cooperatives － Total number of technicians trained 4,113 302 and agricultural － 1,625 218 enterprises Women technicians trained financed and strengthened － Proportion of women 39.51% 72.19%

2c. Priority to women and the poor for new job opportunities in enterprises and farmer cooperatives, 40% for women, 30% for the poor

－ Total new employees 7,586 2,288

－ Women new employees 3,438 1,018

－ Poor new employees 3,143 1,119

－ Proportion of women 45.32% 44.49%

— Proportion of poor 41.43% 48.91%

3a. Training of 270 staff of FIs and 35 staff of RFSPs, 30% of females

－ FI staffer trained 2,288 546

－ Women staffer trained 926 228

－ 40.47% 41.76% Output 3: Proportion of women Rural financial － RFSP staffer trained 25 0 service system developed － Women RFSP staffers trained 16 0 and enhanced － Proportion of women staffers (%) 64.00% 0.00%

3b. Establishment of 29 grassroots financial service units, 30% of female staff, all female staff trained

－ Service units built 170 21

－ Total employees 1,728 423

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Output Social and gender output activities Accumulative January 1 – June 30, 2020

－ Women employees 690 174

－ Female employees trained 516 0

－ Proportion of female employees (%) 39.93% 41.13%

4a. Training on gender and development: (i) concepts and practices of gender and development, (ii) ADB’s gender policies; (iii) ESMS for FIs; and (iv) SGAP, All staff of PPMO and CPMOs, Staff of FIs operating the Project 4b. Gender disaggregated data collection for project documentation, M&E, Assigning responsible persons for documentation and M&E in PPMO, CPMOS and FIs, Establishment of gender disaggregated database

4c. With adequate budget, establish PPMO and 11 CPMOs with women staffers no less than 35%

－ Total number of staff at PPMO 11 9

－ PPMO women staffers 6 4

－ Proportion of women staffers at PPMO 54.55% 44.44%

81 － Number staffers of CPMOs 108 Output 4: Capacity for － 39 project Women staffers of CPMOs 51 implementati on and 48.15% － Proportion of women staffers at CPMOs 47.22% management strengthened 4d. Training provided to 76 PMO staffers in project management, FM and implementation of ESMS/EMDP/SGAP/M&E, women staffer should be no less than 35%

－ PPMO staffers trained 11 9

－ Women staffers trained at PPMO 6 4

－ Proportion of women trained at PPMO 54.55% 44.44%

－ CPMO staffers trained 117 22

－ Women staffers trained at CPMOs 55 10

－ Proportion of women staffers trained at CPMOs 47.01% 45.45%

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 2: ETHNIC MINORITY DEVELOPMENT MONITORING

Ethnic Minority Development Monitoring

Bank of Gansu, Bank of Lanzhou, Yuzhong SPD Rural Bank, LRCB, ZRCB, JRCB Consolidated by the PPMO Reporting period: January 1 – June 30, 2020

Activity* Project village Involved minority** Number of minority HHs Minority population Positive/negative impact

*Title of each loan contract **Ethnic minorities: Dongxiang, Sala, Baoan and Hui

56 Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 3: ETHNIC MINORITY DEVELOPMENT PLAN

Yongjing Coungty,Hezheng County,Jishishan County Consolidated by the PPMO Reporting period: January 1 – June 30, 2020 Action Plan for Ethnic Minority Development Plan

57 Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Responsible Implementatio Detailed Budget Funding Actions and Measures Target Group Monitoring Indicators Person/ Agency n Period Measures/Activities Content Sources 1. Action measures to strengthen project management ability ➢ PM Training for PPMO and relevant working staffs in ➢ Number and times No additional CPMO staff, Province, county PMO, and of people who participate in 1.1 Training to PPMO, budget, BAAH staff, villages about implementation Project PM training. implementation Consulting 2015.9-2019.12 included in the township and and management budget ➢ Number and times agencies staff experts training village project ➢ Land use rights of people who participate in program coordinator transfer training for working land transfer training. staffs, at least one times ➢ number of loan ➢ ESMS training staff who participate in about loan process and training and photos No additional professional ability for ➢ number of experts 1.2 ESMS, loan process budget, PPMO, CPMO workers in bank and training time and professional ability included in the Project FI banks staff Consulting 2015.9-2019.12 ➢ FIs to set up ESMS ➢ Intermediary Bank training to FI banks staff training budget experts Manager Jobs progress report on the program ➢ Expert trains approval of lending activity expenses environmental and social in the statements of safeguards FI manager environmental and social impact assessment results

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

All farmers, PPMO/CPMOs, ➢ PPMO assign ➢ Number of 1.3 Ensure the smooth cooperatives township someone (coordinator) to be workers and its rate implementation of and Government, responsible for Separate Separate ➢ The 2015.9-2019.12 EMDP, SGAP, ESMS enterprises and relevant implementation and internal budget budget implementation effects of all and LURT Framework within the units monitoring for EMDP action guaranteed measures and project area plan monitoring report

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

2. Mitigation for negative effects Responsible Implementatio Detailed Budget Funding Actions and Measures Target Group Monitoring Indicators Person/ Agency n Period Measures/Activities Content Sources ➢ distributed and widely introduce "land use rights transfer framework" to • the number of PPMO/CPMOs, explain and publicize releasing land transfer township 2.1 Conflicts prevention Farmers who ➢ sign the framework policy framework Government, No additional Project through LURT will transfer 2015.9-2019.12 agreement as request • Number of and relevant budget, budget Framework land use rights ➢ Conflict resolution people who explain LTF units when mutual consultation, • Conflicts number negotiation fails disposal and monitoring report according to the complaint procedure ➢ to encourage non- • Extra Number of farmers project farmers to cooperate involved in PPMO/CPMOs, (enterprise, the associated • Training times and All farmers, township No additional agencies and base) or effects after trained by 2.2 Conflicts prevention particularly Government, budget, Project 2015.9-2019.12 directly involved in the project agricultural enterprises for surrounding farmers ethinc and relevant government budget ➢ PMO will equally and cooperatives minorities units program provide the same technology • Benefits depending on service by government agricultural enterprises system and cooperatives

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

➢ Breeding farm construction must strictly comply with design specifications, waste • breeding farm design treatment and disease • immunization and prevention measures must be disease prevention contained. programs ➢ To prepare and No additional • waste treatment 2.3 Measures to prevent Breeding implement ESMS, and budget, facilities equipped environmental pollution bases and PPMO/CPMOS, appoint responsible staff. breeding farm Livestock 2015.9-2019.12 conditions and the zoonotic surrounding BAAH, EPB, ➢ To prepare and construction farm • diseases spread residents implement disease funds and number of complaints

prevention and control plan, operating costs surrounding farmers • appoint responsible staff and local environment and regularly scheduled epidemic prevention examinations. departments monitoring

➢ accept the guidance results and supervision from local environment and epidemic prevention departments

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

3. Enhancement measures for positive effects Responsible Implementatio Detailed Budget Funding Actions and Measures Target Group Monitoring Indicators Person/ Agency n Period Measures/Activities Content Sources Jishishan • New cooperatives and Autonomous PPMO/CPMOs, Government: established new base report County and ➢ 20 new farmer 3.1 Support to build township CNY100,000 (name, time, location, nature, Hezheng cooperatives farmer cooperatives and Government, National size, etc.) County 2015.9-2019.12 ➢ 5 new production 3.5 million 6 new bases by ethnic and relevant program： • apply to government Bao’an, bases minority groups units information on the project Dongxiang ➢ technical training CNY 3.0 • and Sala million training and technical

ethnic minority service records ➢ select ethnic Jishishan characteristics aspects Autonomous ➢ FI staff will County introduce and explain the Bao’an, ➢ number of newly selected 3.2 Support to minority PPMO/CPMOs, loan procedures and policies PMO, bank Dongxiang No additional minority character items farmers, cooperatives FIs, ADB 2015.9-2019.12 before the implementation, daily and Sala budget needed ➢ proportion of loans for and enterprises and go to the village to expenses farmers, minority people conduct business, provide cooperative more convenience to farmers agencies and in the process of the loan enterprises formalities ➢ 2,000 ethnic PPMO/CPMOs, No additional Hezheng minorities trained, and 50% township budget County ethnic are women ➢ Project quarterly report 3.3 Strengthen skill Government, demanded， Project minority 2015.9-2019.12 ➢ at least 2 EM only training program training and guidance and relevant budget farmers, individuals perhouseholds included in the implementation data units cooperatives involved in the project can be project training

trained per year budget

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

➢ When the project is under implementation, CPMO, women’s federation, and village committee shall build a unified working mechanism among cadres responsible for women’s work to learn their needs, opinions and wishes for the project ➢ Derived job opportunities by agriculture production base, agribusiness and cooperative PMO, organization are offered to Training fees for Agriculture and women preferentially, famers Minority 3.4 Encourage women’s Animal especially unskilled job and (included in ➢ Social and gender action women from 2 2015.9-2019.12 SGAP participation Husbandry light manual labor. Women’s Social and plan monitoring report counties Bureau; WF participation in the project gender action production and implantation plan) is not lower than 30%, with ethnic minority women of no lower than 35%, if they are wiling ➢ Women's Federation will organize training for women, making them mastered some relevant skills, like catering service, embroidery, breeding, planting, etc. to take some income-earning activities and increase family income

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Minority County Poverty ➢ 1000 minority farmers from 2 Alleviation Office Yulu Plan 3.5 Non-agricultural laborers would be trained in counties (in or PMO 2015.9-2019.12 500,000 (government ➢ Yulu Plan training report skills training five years, in which women out of the Women's program） account for 25% project) Federation C1. Targets of Enhancement measures for positive effects Accumulative(By June 2020) January 1 – June 30, 2020 Jishishan Autonomous PPMO/CPMOs, ➢ 20 new farmer County and 50 3 Support to build farmer township cooperatives Hezheng cooperatives and 6 new Government, County 2015.9-2019.12 bases by ethnic minority and relevant Bao’an, groups units ➢ 5 new production Dongxiang 11 5 and Sala bases ethnic minority ➢ 2,000 ethnic minorities trained, and 50% are women Total number of ethnic Hezheng PPMO/CPMOs, 2003 1146 County ethnic township minorities trained Strengthen skill training minority Government, 2015.9-2019.12 Total number of ethnic and guidance 1007 671 farmers, and relevant minorities women trained cooperatives units Proportion of ethnic minorities women trained 50.3% 58.6% (%) ➢ Derived job opportunities by agriculture production base, agribusiness and cooperative PMO, organization are offered to women preferentially, especially unskilled job and light manual labor. Agriculture and Women’s participation in the project production and implantation is not lower than 30%, with Minority Encourage women’s Animal ethnic minority women of no lower than 35%, if they are wiling women from 2 2015.9-2019.12 participation Husbandry Total number of farmers counties 4683 1023 Bureau; WF participating in labor Number of women

participating in labor 2074 606

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Number of ethnic minorities women 1097 353 participating in labor Proportion of women

participating in labor (%) 44.3% 59.2% Proportion of ethnic minorities women 52.9% 58.3% participating in labor (%)

➢ 1000 minority laborers would be trained in five years, in which women account for 25%

Total number of ethnic County Poverty Minority minorities labor force 7537 846 Alleviation Office Non-agricultural skills farmers from 2 2015.9- trained PMO training counties (in or out Total number of ethnic Women's 2019.12 of the project) minorities women labor 2831 388 Federation trained Proportion of ethnic minorities women labor 37.6% 45.9% trained (%)

4. Ensure the participation in action plan Responsible Implementatio Detailed Budget Funding Actions and Measures Target Group Monitoring Indicators Person/ Agency n Period Measures/Activities Content Sources ➢ time and place of Minority participation 4.1 Strengthen farmers, PMO, ➢ Included in the ➢ personnel involved in the Daily consultation and cooperatives BAAH; village 2015.9-2019.12 consultation and participation No extra budget meeting record expense participation activities and committee cost ➢ number of complaints and enterprises handling of minority residents 5. Contingency

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

included in the ➢ In the project Jishishan implementation period, public contingency Autonomous participation is encouraged expenses, project Contingency County and CPMOs 2015.5-2019.12 though disputes would ➢ actual payment amount CNY100,000 contingency Hezheng appear. In order to prevent each county, County the unpredictable problems, totally CNY project set up contingency. 200,000 6. Monitoring fees Included in the ➢ monitoring will be Monitoring of project Project Monitoring expense CPMOs 2015.9-2019.12 done in combination with ➢ actual payment amount EMDP consultation budget other safeguard monitoring expenses

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 4: RECORDS OF COMPLAINTS

Consolidated by: PPMO

Reporting period: January 1 – June 30, 2020

Date received Handling unit and results

No.

Name Name Scope

RFSP FI TWNS CPMO RFSP FI TWNS CPMO

Briefdescription

Affected population Affected

Type of complaints * complaints of Type

Others*** Others***

Villagers’ Villagers’

Committee Committee Committee Committee

1 None

RFSP= rural financial service provider *1 writing, 2 oral ** 1 environment, 2 social *** if yes, please indicate the name of the agency

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 5: CREDIT MONITORING

Filed by: BOG, BOL and Yuzhong SPD, LRCB, ZRCB, JRCB Consolidated by: PPMO Reporting period: January 1 – June 30, 2020

Fund source

(10,000)

Date of No. Borrower Use Maturity Remarks

Nature disbursement (10,000) Overdue Overdue ADB Counterpart

repayment repayment

Population

FI (10,000) FI (10,000)

transfer (mu) transfer

Total Women Total Minority Total

Land use right use Land

Loan balance of balance Loan farmer HH Poor

Total population Total

Amount (10,000) Amount

Total Minority HH Minority Total

No. of Households No.

Total Poor population Poor Total No. of Admin Villages of Admin No. Herb processing 1 Farmer HH Retail 15 12 m 2020.1.2 15 1 1 2 1 15 Minxian and marketing ------Purchase Yuzhong Jufeng vegetable Yuzhong,Recycl 2 Retail 280 12 m 2020/01/15 280 1 1000 3000 20 50 1350 - - 15 280 Farm Products Co. packaging - ed ADB Fund materials Purchase Yuzhong Yuxiang vegetable Yuzhong,Recycl 3 Retail 280 12m 2020/01/15 280 1 1100 3200 15 35 1600 - - 20 280 - Farm Products Co. packaging ed ADB Fund materials Yuzhong Chengguan Supply Yuzhong,Recycl 4 Retail Buy fertilizer 200 12m 2020/02/10 200 1 2000 4200 3 15 2000 - - 200 and Marketing - ed ADB Fund Coop. Yuzhong Shunde Purchase Green Vegetable vegetable Yuzhong,Recycl 5 Retail 290 12m 2020/02/11 290.00 1 150 400 1 3 180 - - 2 290 Packaging Materials packaging - ed ADB Fund Co., Ltd. materials Yuzhong Heji Agro- Agro-machinery Yuzhong,Recycl 6 Retail 280 12m 2020/03/19 280.00 1 200 480 1 4 220 - - 280 - machinery Co. marketing ed ADB Fund Yuzhong Maoyuan Potato Production Yuzhong,Recycl 7 Retail Potato production 290 12m 2020/03/19 290 1 15 50 1 3 26 - - 200 290 and Marketing - ed ADB Fund Coop.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Yuzhong Muxin Yuzhong,Recycl 8 Retail Pig production 300 12m 2020/06/05 300.00 1 9 22 - - 11 - - 300 300 - Agro-livestock Co. ed ADB Fund Yuzhong Muxin Yuzhong,Recycl 9 Retail Pig production 100 12m 2020/06/05 100 1 9 22 - - 11 - - 300 100 Agro-livestock Co. ed ADB Fund Purchase Lanzhou Sanxin vegetable Yuzhong,Recycl 10 Green Food Co., Retail 500 12m 2020/06/05 500.00 1 800 2800 1 3 1500 - - 500 packaging - ed ADB Fund Ltd. materials Purchase vegetable Yuzhong,Recycl 11 Farmer HH Retail 180 12m 2020/04/28 180.00 1 5 18 - - 11 - - 0 180 packaging - ed ADB Fund materials Cash Crop Chinese herb 12- Lintao, Recycled 12 Retail 190.2 2020.01-04 190.2 6 6 21 - - 6 - - - 145.2 45 Base- Chinese herb planting 24m ADB Fund

Forest grass fruit 12- Lintao, Recycled 13 base-Flower Retail Flower planting 364 2020.01-06 364 8 8 30 - - 8 - - - 279 85 ADB Fund planting 36m Forest grass fruit Forest tree 12- Lintao, Recycled 14 base-Forest tree Retail 1,962 2020.01-06 1962 28 31 98 - - 31 - - - 1,512 450 seedling ADB Fund seedling 36m Cash Crop Base- Lintao, Recycled 15 Retail Potato planting 28 12m 20200416 28 1 1 4 - - 1 - - - 20 8 Potato ADB Fund Cash Crop Base- Lintao, Recycled 16 Retail Corn planting 80 36m 2020.04-06 80 2 2 7 - - 2 - - - 60 20 Others ADB Fund Animal production 12- 1,088 Lintao, Recycled 17 Retail Cow production 1438.9 2020.01-06 1438.9 18 21 75 - - 21 - - - 350 base - Cow 36m .9 ADB Fund

Animal production Animal 12- Lintao, Recycled 18 Retail 407.5 2020.01-06 407.5 11 11 40 - - 11 - - - 307.5 100 base - 0thers production 36m ADB Fund

Animal production 12- Lintao, Recycled 19 Retail Sheep production 1020 2020.03-06 1020 7 9 32 - - 9 - - - 770 250 base - Sheep 36m ADB Fund

Animal production 1106.9 12- 1106.9 846.9 Lintao, Recycled 20 Retail Pig production 2020.01-06 13 13 49 - - 13 - - - 260 base - Pig 9 36m 9 9 ADB Fund

Wholesale of 12- 2,442 Lintao, Recycled 21 Crop production Retail 3192.4 2020.01-06 3192.4 40 46 165 - - 46 - - - 750 crops 36m .4 ADB Fund

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Lintao Jingxiu seedling Planting Sapling Lintao, Recycled 22 Retail 280 12m 20200430 280 1 12 38 2 7 3 - - - 200 80 Professional production ADB Fund cooperative Lintao Liuyang Fertilizer Lintao, Recycled 23 Retail 400 12m 20200303 400 1 30 118 3 12 30 - - - 300 100 Fertilizer Co. LTD wholesale ADB Fund Lintao Huimin Fertilizer Lintao, Recycled 24 Agricultural Retail 150 12m 20200303 150 1 35 131 2 8 35 - - - 100 50 wholesale ADB Fund Resources Co. LTD Lintao Huashan seedling Planting Sapling Lintao, Recycled 25 Retail 1190 12m 20200306 1,190 1 32 112 5 20 32 - - - 890 300 Professional production ADB Fund cooperative Lintao Xintai Ecological seed Lintao, Recycled 26 farming farmers Retail Pig production 55 36m 20200425 55 1 5 16 - - 5 - - - 40 15 ADB Fund Professional cooperative Lintao Changsheng Breeding Lintao, Recycled 27 Retail Pig production 40 12m 20200410 40 1 5 21 - - 5 - - - 30 10 Professional ADB Fund Cooperative LintaoXudong Farmers Lintao, Recycled 28 Retail Cow production 35 36m 20200225 35 1 5 20 - - 5 - - - 25 10 Professional ADB Fund Cooperative Lintao Yuanqi farming farmers Herb processing Lintao, Recycled 29 Retail 70 36m 20200623 70 1 5 20 1 4 5 - - 50 20 professional and marketing ADB Fund cooperatives Lintao Shengui Garden Flower and Sapling Lintao, Recycled 30 Retail 650 24m 20200513 650 1 29 92 2 9 29 - - - 500 150 Tree Cultivation production ADB Fund Base Lintao Hongxing Vegetable Planting Vegetable Lintao, Recycled 31 Retail 230 12m 20200418 230 1 5 18 1 4 5 - - - 180 50 Professional production ADB Fund Cooperation Zhuanglang Jiaxing 32 Potato Production Retail Potato 45 18m 20190509 45 1 1 5 1 2 2 - - - 45 Coop.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Wholesale of Gansu Gonghe 33 Retail fruits and 1,500 18m 20190125 1,500 1 5 31 3 5 10 - - - 1,500 Foodstuff Co. vegetables Zhuanglang Jingyuan Fruit and Retail Fruit production 34 Vegetable Trade 800 13m 20200331 800 1 3 18 4 20 9 - - - 798 Co. Zhuanglang 35 Wanlong Carton Retail Fruit production 700 18m 20190228 700 1 3 19 2 4 8 - - - 700 Co., Ltd. Zhuanglang

Yingyuanheng Retail Fruit production 1,000 18m 20190408 1,000 1 2 11 2 6 6 - - - 1,000 36 Fruit Co., Ltd. Zhuanglang Xinshengyuan Zhuanglang,Rec 37 Retail Cow production 1,000 18m 20190430 1,000 1 10 45 1 5 20 - - - 1,000 Cattle Industry Co. - ycled ADB Fund Ltd Zhuanglang Huifeng Pig Farmers Zhuanglang,Rec 38 Retail Pig production 150 24m 20190621 150.00 1 2 10 1 6 4 - - - 150 Professional - ycled ADB Fund Cooperative Zhuanglang Zhuanglang,Rec 39 Xianghong Retail Chicken 200 36m 20190628 200 1 1 6 1 5 3 - - - 200 - ycled ADB Fund Breeding Co., Ltd. Zhuanglang Vinegar, soy Zhuanglang,Rec 40 Zhaoyuan Vinegar Retail 600 24m 20190621 600 1 3 16 1 5 5 - - 600 source - ycled ADB Fund Co. Zhuanglang poverty reduction Xinhong Garment Retail Zhuanglang,Rec 41 workshop 80 36m 20190618 80 1 4 23 1 6 18 - - 80 - Factory ycled ADB Fund Zhuanglang Zhongtian Agriculture and Sapling 42 Retail 2,400 18m 20190629 2,400 1 22 70 ------Forestry production 2,400 Technology Co., Ltd. Zhuanglang Zhuanglang,Rec 43 Zhenrong Potato Retail Potato production 40 24m 20190731 40 1 ------40 - Production Coop. ycled ADB Fund

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Zhuanglang Qinghe Zhuanglang,Rec 44 Retail Vegetable 70 12m 20190814 70 1 ------70 - Fruit Co. production ycled ADB Fund Zhuanglang Other production Henghui Package Retail Zhuanglang,Rec 45 support activities 3,000 12m 20190924 3,000 1 ------3,000 - Fruit Co. ycled ADB Fund Zhuanglang Hongxin Fruit and Retail Vegetable Zhuanglang,Rec 46 650 18m 20190828 650 1 ------650 - Vegetable Co. production ycled ADB Fund Zhuanglang Jiayou Sapling Zhuanglang,Rec 47 Retail 2,500 18m 20190927 2,500 1 ------2,500 Crop Farming Coop. production - ycled ADB Fund Zhuanglang Aquaculture Industry Poverty Zhuanglang,Rec 48 Retail Cow production 1,000 36m 20200618 1,000 28 733 2986 220 896 142 - - 0 1,000 Alleviation - ycled ADB Fund Development Co., Ltd. Zhuanglang Planting Industry Zhuanglang,Rec 49 Poverty Alleviation Retail Potato production 1,000 36m 20200618 1,000 32 237 923 71 302 23 - - 230 1,000 - ycled ADB Fund Development Co. LTD Zhuanglang Forestry and Fruit Industry Poverty Zhuanglang,Rec 50 Retail Apple production 1,000 36m 20200618 1,000 56 1250 4320 296 1184 3750 - - 0 1,000 Alleviation - ycled ADB Fund Development Co., Ltd. Zhuanglang Agricultural Industry Business Zhuanglang,Rec 51 Poverty Alleviation Retail 2,800 12m 2020.05.22 2,800 ------0 2,800 turnover - ycled ADB Fund Development Co., Ltd. Jingning Zhunong Fruit purchase Retail Jingning,Recycled ADB Fund 52 Fruit Co. and marketing 500 24m 2019-3-1 500 1 10 46 4 12 4 - - 16 500. -

Jingning Hongxing Jingning,Recycl 53 Retail Potato production 1,100 24m 2019-5-10 1,100 1 10 45 3 6 3 - - 1100 Family Farm - ed ADB Fund Gansu Shunyuan Fruit purchase Jingning,Recycl 54 Retail 600 24m 2019-3-30 600 1 6 25 3 7 3 - - 600 - Fruit Co. and marketing ed ADB Fund

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Jingning Zhiqi Farm Purchase of farm Products Purchase Retail 350 24m 2019-5-20 350 1 2 8 1 2 1 - - 350 Jingning,Recycl 55 products - and Marketing Coop ed ADB Fund Jingning Fenghua Fruit purchase Fruit Purchase and Retail 100 24m 2019-8-16 100 1 6 16 4 12 6 - - 100 Jingning,Recycl 56 and marketing - Marketing Center ed ADB Fund

Jingning Huimin Fruit purchase Jingning,Recycl 57 Retail 160 24m 2019-8-23 160 - 1 15 55 3 7 3 - - - 160 - Fruit Coop and marketing ed ADB Fund

Jingning Kaida Fruit Fruit purchase Jingning,Recycl 58 Retail 120 24m 2019-8-23 120 - 1 5 17 3 6 3 - - - 120 Coop and marketing - ed ADB Fund

39,069. 39,069. Total - - - 293 7,925 23,978 683 2,675 11,224 - - 1,083 - - - 99 99

* It refers to wholesale or retail loan ** It refers only to the total number of farmer households, registered poverty households, total poor population, total women population and total minority population.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 6: CAPACITY BUILDING ACTIVITIES

Reporting period: January 1 – June 30, 2020

1.Province

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s COMO staff, ESMS application LRCB Train the staff of Lintao CPMO and environmental 2020-06-09 1 Lintao PPMO and sustainable 19 LRCB manager, social development training manager and other staff 1 Province PPMO COMO staff, ESMS application YZSPD Train the staff of Yuzhong CPMO environmental 2019-06-16 1 Yuzhong and sustainable 20 and YZSPD manager, social development training manager and other staff

2.Jingchuan

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s Duan Jinbao.Senior Full film double ridge and furrow CPMO staff, Gaoma Village, Jingchuan Agricultural technical Agronomist, Jingchuan 2 Jingchuan 2020-04-22 1 sowing technology and project 234 technicians, Libao Town, CPMO training County Agricultural publicity management farmers Technology Extension Center

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s

Meeting room of CPMO staff, Xue Yufeng, Senior Standardization and Jingchuan technicians, Jingchuan improvement Standardization of pesticide Agronomist, Agricultural 2020-05-12 1 County 45 Corporate CPMO training for pesticide operators Comprehensive Law Livestock Cooperative operators Service Center Managers Enforcement Team Duan Qibin, Agricultural Extension Researcher of Provincial Department of Agriculture and Rural Affairs; General Secretary Xi Jinping's CPMO staff, Wu Jianping: Deputy Director Ability improvement Jingchuan important expositions on poverty technicians, and Professor of Provincial Jingchuan training for 2020-05-24 2 County Guest alleviation, implementation of rural 86 others,Corporate Committee of Agricultural CPMO agricultural cadres in House revitalization, animal husbandry, Cooperative and Rural Affairs of the Jingchuan County modern agriculture, etc. Managers Provincial CPPCC; Zhang Jingli: Lecturer of Municipal Party School; Wang Lirong: 2 Jingchuan Senior Lecturer of County Party School Li Xinmin: Senior Veterinarian of County Animal Husbandry and Veterinary Center, Ma Zuohu: Beef cattle breeding and fattening, Senior Agronomist of County Jingchuan Agricultural practical melon planting, greenhouse pepper, 2020-04-14 57 Wangcun Town 560 Farmer Vegetable Office, Gao CPMO technology training tomato pollution-free planting Jinlong: Senior Lecturer of technology, etc. County Agricultural Broadcasting School, Lei Zhilin: Senior Agronomist of County Vegetable Office; Li

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s Congying: Senior Agronomist of County Agricultural Broadcasting School ; Wang Subject: Pastor of the County Animal Husbandry and Veterinary Center. Wei Haiyun: Senior Wandouping Coop and Jingchuan Orchard standardized Standardized management Agronomist, Fruit Industry 2020-05-19 1 Collage,Luohan 131 enterprise CPMO management training technology of persimmon orchard Technical Service Center of dong Town members Jingchuan County

3.Lintao

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s Laozhuang Training Course for Agronomist and above Village Poor Households in professional technical 2020.3.25 1 Lintao CPMO Cattle and sheep breeding 102 Poor households Committee Laozhuang Village, personnel of the Agriculture Square Taoyang Town and Rural Bureau 3 Lintao Shangying Training Course for Agronomist and above Village Poor Households in professional technical 2020.3.9 1 Lintao CPMO Lily, Chinese herb planting 121 Poor households Committee Shangying Village, personnel of the Agriculture Square Shangying Town and Rural Bureau Houdiwan Training Course for Agronomist and above Village Poor Households in professional technical 2020.3.14 1 Lintao CPMO Lily planting 200 Poor households 3 Lintao Committee Houdiwan personnel of the Agriculture Square Village,Taishi Town and Rural Bureau

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s Training Course for Wangjiagou Agronomist and above Poor Households in Village professional technical 2020.4.15 1 Lintao CPMO Wangjiagou Lily planting 54 Poor households Committee personnel of the Agriculture Village ,Zhongpu Square Town and Rural Bureau Training Course for Yangjiashan Agronomist and above Poor Households in Village professional technical 2020.3.26 1 Lintao CPMO Yangjiashan Potato planting 113 Poor households Committee personnel of the Agriculture Village,Yaodian Square Town and Rural Bureau

Training Course for Agronomist and above Xiakou Village Poor Households in professional technical 2020.3.24 1 Committee Lintao CPMO Xiakou Potato and vegetable planting 100 Poor households personnel of the Agriculture Square Village,Xiakou 3 Lintao Town and Rural Bureau

Training Course for Agronomist and above Yingwu Village Poor Households in professional technical 2020.3.25 1 Committee Lintao CPMO Yingwu Chinese herb planting 74 Poor households personnel of the Agriculture Square Village,Nanpin Town and Rural Bureau

Training Course for Xingjishan Agronomist and above Poor Households in Village professional technical 2020.3.20 1 Lintao CPMO Xingjiashan Chinese herb planting 48 Poor households Committee personnel of the Agriculture Village,Kangjiaji Square Town and Rural Bureau

Training Course for Xiazhaizi Agronomist and above Poor Households in Village professional technical 2020.4.9 1 Lintao CPMO Xiazhaizi Chinese herb planting 74 Poor households Committee personnel of the Agriculture Villane,Xindian Square Town and Rural Bureau

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s Training Course for Nongmen Agronomist and above Poor Households in Village professional technical 2020.4.5 1 Lintao CPMO Longmen Chinese herb planting 77 Poor households Committee personnel of the Agriculture Village,Longmen Square Town and Rural Bureau Training Course for Agronomist and above 3 Lintao Daying Village Poor Households in professional technical 2020.4.15 1 Committee Lintao CPMO Daying vegetable planting 56 Poor households personnel of the Agriculture Square Village,Xindian Town and Rural Bureau Training Course for Damaigou Agronomist and above Poor Households in Village professional technical 2020.3.25 1 Lintao CPMO Dmaigou Chinese herb planting 93 Poor households Committee personnel of the Agriculture Village,Xindian Square Town and Rural Bureau Training Course for Agronomist and above Dunzi Village Poor Households in professional technical 2020.3.25 1 Committee Lintao CPMO Dunzi Chinese herb planting 96 Poor households personnel of the Agriculture Square Village,Xindian and Rural Bureau Town Training Course for Agronomist and above Yangpo Village Poor Households in professional technical 3 Lintao 2020.4.28 1 Committee Lintao CPMO Yangpo Chinese herb planting 105 Poor households personnel of the Agriculture Square Village,Yaodian and Rural Bureau Town Training Course for Agronomist and above Jinggou Village Poor Households in professional technical 2020.4.20 1 Committee Lintao CPMO Jinggou Potato planting 95 Poor households personnel of the Agriculture Square Village,Zhantan and Rural Bureau Town

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s Training Course for Agronomist and above Panjiapo Village Poor Households in professional technical 2020.4.27 1 Committee Lintao CPMO Panjiapo Potato planting 166 Poor households personnel of the Agriculture Square Village,Xintian and Rural Bureau Town Training Course for Agronomist and above Huoxian Village Poor Households in professional technical 2020.5.4 1 Committee Lintao CPMO Lily planting 180 Poor households Huoxian personnel of the Agriculture Square Village,Taishi Town and Rural Bureau Training Course for Huangjiachuan Agronomist and above Poor Households in Village professional technical 2020.5.13 1 Lintao CPMO Huangjiachuan Chinese herb planting 78 Poor households Committee personnel of the Agriculture Village,Yaodian Square and Rural Bureau Town 3 Lintao Agronomist and above Manwa Training Course for Vegetable ,Potato and Chinese herb professional technical 2020.5.16 1 Township Lintao CPMO Poor Households in 459 Poor households planting personnel of the Agriculture Government Manwa Town and Rural Bureau Training Course for Agronomist and above Poor Households in Qijiagou Village professional technical 2020.5.21 1 Lintao CPMO Qijiagou Chinese herb planting 91 Poor households Committee personnel of the Agriculture Village,Yaodian and Rural Bureau Town Training Course for Agronomist and above Poor Households in Ronghe Village professional technical 2020.5.26 1 Lintao CPMO Ronghe Vegetable and Potato planting 42 Poor households Committee personnel of the Agriculture Village,Taoyang and Rural Bureau Town

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

No. of No. of No. County Time Venue Host Theme Main Contents Trainer Days Participant Participants s Training Course for Agronomist and above Hongtugou Poor Households in professional technical 3 Lintao 2020.6.2 1 Village Lintao CPMO Hongtugou Potato planting 46 Poor households personnel of the Agriculture Committee village,Xindian and Rural Bureau Town Training Course for Agronomist and above Wayaotan Poor Households in professional technical 2020.6.12 1 Village Lintao CPMO Wayaotan Chinese herb planting 30 Poor households personnel of the Agriculture Committee Village,Shangying and Rural Bureau Town CPMO、 3 Lintao Professional technicians of Poverty Training Course for Training of new business entity County Agriculture and Rural Gansu Sanrong Alleviation Poor Households in Heads and management, planting and breeding Bureau, professors of Gansu 2020.5.21—5.26 6 Technology Office, Laozhuang 430 managers of technology, entrepreneurial Agricultural University and Training Center Agricultural Village,Tanyang cooperatives awareness, etc. Xindi e-commerce Broadcasting Town technicians, etc. School

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 7: FURTHER SUBLOANS OF THE PROJECT

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Amount Disbursed No. of No. County Bank Loan Applicant Subloan Funding Source Activity s CNY 10,000 USD 1,000

1 Minxian BOL Hou Guifang 1 15.00 24.43 Counterpart Output 2: Revolving fund Yuzhong Jufeng Agricultural Products Col Ltd. 1 15.00 24.43 Counterpart Output 2: Revolving fund Yuzhong Yuxiang Agricultural Product Co. Ltd. 1 280.00 395.51 Recycled Output 2: Revolving fund Yuzhong Chengguan Suply and Marketing Coop 1 280.00 395.51 Recycled Output 2: Revolving fund Yuzhong Shunde Green Vegetable Package 1 200.00 282.51 Recycled Output 2: Revolving fund Material Co. Ltd. Yuzhong Heji Agro-machinery Co. Ltd. 1 290.00 409.63 Recycled Output 2: Revolving fund Yuzhong SPD 2 Yuzhong Yuzhong Maoyuan Potato Production and Rural Bank 1 280.00 395.51 Recycled Output 2: Revolving fund Marketing Coop Yuzhong Muxing Agricultural and Livestock 1 290.00 409.63 Recycled Output 1: Open Field production base S&T Co. Ltd. Yuzhong Muxing Agricultural and Livestock S&T 1 300.00 423.76 Recycled Output 1: Animal production base Co. Ltd. Lanzhou Sanxing Green Foodstuff Co. Ltd. 1 100.00 162.83 Counterpart Output 2: Revolving fund Farmer household 1 500.00 706.26 Recycled Output 2: Revolving fund Farmer household Recycled Output 1: Open Field production base 3 Lintao LRCB 6 145.20 205.10 Farmer household 8 279.00 394.10 Recycled Output 1: Greenhouse production base Farmer household 32 1512.00 2135.74 Recycled Output 1: Tree nursery production base Farmer household 1 20.00 28.25 Recycled Output 1: Open Field production base Farmer household 2 60.00 84.75 Recycled Output 1: Other cash crops production base Farmer household 25 1088.90 1538.10 Recycled Output 1: Cattle production base 3 Lintao LRCB Farmer household 11 307.50 434.35 Recycled Output 1: Sheep production base Farmer household 12 770.00 1087.65 Recycled Output 1: Chicken production base Farmer household 14 846.99 1196.40 Recycled Output 1: Pig production base Farmer household 46 2442.40 3449.96 Recycled Output 2: Revolving fund Lintao Jinxiu Seedling Planting Professional 1 200.00 282.51 Recycled Output 2: Revolving fund Cooperative

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Lintao Liuyang Fertilizer Co., Ltd. 1 300.00 423.76 Recycled Output 2: Revolving fund Lintao Huimin Agricultural Materials Co., Ltd. 1 100.00 141.25 Recycled Output 2: Revolving fund Lintao Huashan Seedling Planting Professional 1 890.00 1257.15 Recycled Output 2: Revolving fund Cooperative Lintao Xintai Ecological Farmers Professional 1 40.00 56.50 Recycled Output 2: Revolving fund Cooperative Lintao Changsheng Breeding Professional 1 30.00 42.38 Recycled Output 2: Revolving fund Cooperative Lintao Xudong Farmers Professional Cooperative 1 25.00 35.31 Recycled Output 2: Revolving fund Lintao Yuanqi Farmers Professional Cooperative 1 50.00 70.63 Recycled Output 2: Revolving fund Lintao Shengui Garden Flower and Tree 1 500.00 706.26 Recycled Output 2: Revolving fund Cultivation Base Lintao Hongxing Vegetable Planting Cooperative 1 180.00 254.26 Recycled Output 2: Revolving fund Professional Cooperative of Potato Planting 1 45.00 73.28 Counterpart Output 1: Open Field production base Farmers in Jiaxing, Zhuanglang County Gansu Gonghe Food Co., Ltd. 1 1500.00 2442.52 Counterpart Output 1: Tree nursery production base Zhuanglang County Jinyuan Fruit and Vegetable 1 800.00 1302.68 Counterpart Output 1: Tree nursery production base Trading Co., Ltd. Zhuanglang County Wanlong Carton Co., Ltd. 1 700.00 1139.84 Counterpart Output 1: Tree nursery production base Zhuanglang County Yingyuan Heng Fruit Co., Ltd. 1 1000.00 1628.35 Counterpart Output 1: Tree nursery production base Zhuanglang County Zhongtian Agriculture and 1 2400.00 3908.03 Counterpart Output 1: Tree nursery production base Forestry Technology Co., Ltd. Zhuanglang County Xinshengyuan Cattle Industry 4 Zhuanglang ZRCB 1 1000.00 1412.53 Recycled Output 1: Animal production base Co., Ltd. Zhuanglang County Huifeng Pig Farmers 1 150.00 211.88 Recycled Output 1: Animal production base Professional Cooperative Zhuanglang County Xianghong Breeding Co., Ltd. 1 200.00 282.51 Recycled Output 1: Animal production base Zhuanglang County Zhaoyuan Vinegar Co., Ltd. 1 600.00 847.52 Recycled Output 2: Revolving fund Zhuanglang Xinhong Garment Factory 1 80.00 113.00 Recycled Output 2: Revolving fund Zhuanglang County Zhenrong Potato Planting 1 40.00 56.50 Recycled Output 1: Open Field production base Farmers Professional Cooperative Zhuanglang County Qinhe Forest Fruit 1 70.00 98.88 Recycled Output 2: Revolving fund Development Co., Ltd.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Zhuanglang Henghui Packaging Fruit Co., Ltd. 1 3000.00 4237.59 Recycled Output 2: Revolving fund Zhuanglang County Hongxin Fruit and Vegetable 1 650.00 918.14 Recycled Output 1: Greenhouse production base Co., Ltd. Jiayou Planting Farmers Professional Cooperative 1 2500.00 3531.32 Recycled Output 1: Tree nursery production base of Zhuanglang County Zhuanglang County Dabei Agriculture and Animal 1 300.00 423.76 Recycled Output 2: Revolving fund Husbandry Technology Co., Ltd. Zhuanglang County Aquaculture Industry Poverty 1 1000.00 1412.53 Recycled Output 1: Animal production base Alleviation Development Co., Ltd. Zhuanglang County Planting Industry Poverty 1 1000.00 1412.53 Recycled Output 1: Cash crops production base Alleviation Development Co., Ltd. Zhuanglang County Forestry and Fruit Industry 1 1000.00 1412.53 Recycled Output 1: Tree nursery production base Poverty Alleviation Development Co., Ltd. Zhuanglang County Agricultural Industry Poverty 1 2800.00 3955.08 Recycled Output 2: Revolving fund Alleviation Development Co., Ltd. Jingning County Zhunong Fruit Co., Ltd. 1 500.00 706.26 Recycled Output 2: Revolving fund Jingning Red Star Family Farm 1 1100.00 1553.78 Recycled Output 1: Open Field production base Gansu Shunyuan Fruit Industry Development Co., 1 600.00 847.52 Recycled Output 2: Revolving fund Ltd. Jingning County Zhiqi Agricultural and Sideline 1 350.00 494.39 Recycled Output 2: Revolving fund Products Purchase and Sale Cooperative Jingning County Fenghua Fruit Purchase and Sale 1 100.00 141.25 Recycled Output 2: Revolving fund Center

Jingning County Huimin Fruit Industry Cooperative 1 160.00 226.00 Recycled Output 2: Revolving fund Kaida Fruit Industry Cooperative in Jingning 1 120.00 169.50 Recycled Output 2: Revolving fund 5 Jingning JRCB County Jingning County Sentai Agricultural Materials Co., 1 200.00 325.67 Counterpart Output 2: Revolving fund Ltd. Jingning Wanshun Farmer Fruit Professional 1 200.00 325.67 Counterpart Output 2: Revolving fund Cooperative Jingning County Zhuohui Fruit Co., Ltd. 1 260.00 423.37 Counterpart Output 2: Revolving fund Jingning County Guangying Fruit Professional 1 257.00 418.48 Counterpart Output 2: Revolving fund Cooperative Jingning County Gaoyuan Red Fruit Distribution 1 180.00 293.10 Counterpart Output 2: Revolving fund Co., Ltd.

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Jingning County Xinmin Fruit Co., Ltd. 1 400.00 651.34 Counterpart Output 2: Revolving fund Jingning County Guofu Fruit Industry Co., Ltd. 1 200.00 325.67 Counterpart Output 2: Revolving fund Farmer household 1 200.00 325.67 Counterpart Output 2: Revolving fund Farmer household 1 300.00 488.50 Counterpart Output 2: Revolving fund 合计 215 38463.99 56221.42

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

APPENDIX 8: SNAPSHOTS OF MIS

Figure 1: Templates for progress report and ESMS report

Figure 2: Subloans for water-saving measures and smart agriculture

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Figure 3: Subloan monitoring information

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告

Figure 4: Outputs of reports

Gansu Featured Agriculture and Financial Service System Development Project Safeguard Monitoring Report 甘肃特色农业及金融服务体系建设项目安保监测报告