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World Bank Document Document of The World Bank Report No: 17333-IND Public Disclosure Authorized PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN IN THE AMOUNT OF US$6.9 MILLION AND A Public Disclosure Authorized GRANT FROM THE GLOBAL ENVIRONMENT FACILITY TRUST FUND IN THE AMOUNT OF SDR 3.1 MILLION (US$4.1 MILLION EQUIVALENT) TO THE REPUBLIC OF INDONESIA Public Disclosure Authorized FOR A CORAL REEF REHABILITATION AND MANAGEMENT PROJECT IN SUPPORT OF THE FIRST PHASE OF THE CORAL REEF REHABILITATION AND MANAGEMENT PROGRAM MARCH 4, 1998 Public Disclosure Authorized Rural Development and Natural Resources Sector Unit Indonesia Country Management Unit East Asia and Pacific Region CURRENCYEQUIVALENTS (As of February13, 1998) CurrencyUnit = IndonesianRupiah Rp. 1.0 = US$0.0002 US$1 = Rp. 5,000 FISCALYEAR Governmentof Indonesia: April 1-hlarch31 IBRD: July 1-June30 TO THE MEMORY OF DR. THAMRIN NURDIN Vice President:Jean-Michel Severino, EAP CountryDirector: Dennis de Tray, E-ACIF Sector Manager:Geoffrey Fox, EASRD Task Team Leader: Sofia Bettencourt,EASRD KEYABBREVIATIONS AND ACRONYMS Adat Traditionalorganization or practice IUCN WorldConservation Union ADB AsianDevelopment Bank JICA JapanIntemational Cooperation Agency AIG AltemativeIncome Generation KAMLA EnforcementAuthorities, including Navy AMDAL Environment.Impact Assessment Procedure andPolice KEHATI IndonesiaBiodiversity Foundation AMSAT AustralianMarine Science Consortium KepMen MinisterialDecree ANDAL EnvironmentalAssessment KOMDA ProvincialAMDAL Commission APL AdaptableProgram Loan Latupati MalukuTraditional Inter-village Council AusAID AustralianAgency for International LH Ministryof Environment Development LCC LiveCoral Cover BAPPEDATk. I ProvincialDevelopment Planning Agency LIPI IndonesianInstitute of Sciences BAPEDAL EnvironmentalImpact Management Agency LKMD VillageDevelopment Council BAPPEDALDA ProvincialPollution Control Agency LSM LocalNon-Govemmental Organization BAPPENAS NationalDevelopment Planning Agency MMTI MarineMarket Transformation Initiative Bendaharawan Treasurer MOF/KPKN Ministryof Finance/DirectorateGeneral BPKP CentralAudit Bureau MOU of Budget Memorandumof Understanding Bupati DistrictRegent MPA MarineProtected Area CAS CountryAssistance Strategy MSY MaximumSustainable Yield CBM CommunityBased Management NGO Non-GovemmentalOrganization CD-IRom CompactDisk Software NPV NetPresent Value CMI CoralMortality Index PCD ProjectConcept Document COREMAP CoralReef Rehabilitation and Management PerDa PerhaturanDaerah (Provincial Regulation) Program PHPA DirectorateGeneral of ForestProtection andConservation COREMAPI COREMAPFirst Phase (Initiation) Pimpro PimpinanProyek (Project Manager) COREMAP11 COREMAPSecond Phase (Acceleration) PIP ProjectImplementation Plan COREMAPIll COREMAPThird Phase (Institutionalization) PMO ProjectManagement Office CRITC CoralReef Information and Training Center PR PublicRelations (Firm) CRMS CoralReef Monitoring System PRA ParticipatoryRural Appraisal DG Budget DirectorateGeneral of Budget POKMAS VillageGroups DGF DirectorateGeneral of Fisheries QBS Quality-BasedSelection DinasPerikanan ProvincialFisheries Agency QCBS Qualityand Cost-Based Selection DIP DevelopmentBudget Allocation Repelita FiveYear (National) Development Plan DKN NationalMarine Council S&E Surveillanceand Enforcement System ERR EconomicRate of Retum Sarlita SectoralDevelopment Plan FRR FinancialRate of Return Sasi MalukuTraditional Management Practices(Closures) GAAP GenerallyAccepted Accounting Principles SBKSDA Bureaufor ForestProtection and Conservation GEF GlobalEnvironment Facility SDR SpecialDrawing Rights GRT VesselGross Tons SK SuratKeputusan (Decree) GOI Govemmentof Indonesia SOE Statementof Expenditure IBRD IntemationalBank for Reconstructionand SPABP/lnpresGrant from Central to RegionalGovemments Development TA TechnicalAssistance InpresPengendalian Specific Environmental Block Grant from the TBR TakaBone Rate National Park DarnpakLingkungan Nationalto RegionalGovemments TVRI IndonesianNational Television Channel HF HighFrequency (Radio) UNDP UnitedNations Development Program ICE IntemationalCompetitive Bidding US$M MillionUnited States Dollars ICR ImplementationCompletion Report UYHD GOI'sForce Account Payment System ICZM IntegratedCoastal Zone Management VHF VeryHigh Frequency (Radio) I I Indonesia Indonesia: Coral Reef Rehabilitationand ManagementProject CONTENTS Page A. F'rogramand ProjectDevelopment Objective 2 1. Programdevelopment objective and key performanceindicators 2 2. Projectdevelopment objective, global objective, and key performance indicators 3 B. S;trategicContext 3 1. Sector-relatedCAS goal and GEF Operational Program supported by the program 3 1.a Sector-relatedCountry Assistance Strategy (CAS) goal supportedby the program 3 1.b GEF OperationalStrategy/program objective addressed by the program 3 2. Main sector issuesand Governmentstrategy 4 3. Sector issuesto be addressedby the programand strategicchoices 4 C. Programand ProjectDescription Summary 5 1. Programand ProjectDescription Summary 5 1.a The IndonesiaCoral Reef Rehabilitationand ManagementProgram 5 1.b The Coral Reef Rehabilitationand ManagementProject - ProjectComponents 7 2. Key policyand institutionalreforms supported by the project 7 3. Benefitsand targetpopulation 8 4. Institutionaland implementationarrangements 8 D. ProjectRationale 10 1. Projectalternatives considered and reasonsfor rejection 10 2. Major relatedprojects financed by the Bank,GEF, and otherdevelopment agencies 11 3. Lessons learnedand reflectedin projectdesign 11 4. Indicationsof borrowercommitment and ownership 12 5. Valueadded of Bankand Global supportin this project 12 E. SummaryProject Analysis 13 1. Economic 13 1.a EconomicAnalysis 13 1.b IncrementalCosts 13 2. Financial 14 3. Technical 14 4. Institutional 15 5. Social 15 6. EnvironmentalAssessment 16 7. ParticipatoryApproach 17 F. Sustainabilityand Risks 17 1. Sustainability 17 2. Critical risks 18 3. Possiblecontroversial aspects 18 Indonesia Indonesia: Coral Reef Rehabilitationand ManagementProject CONTENTS Page G. MainLoan Conditions 19 1. BoardConditions 19 2. DisbursementConditions 19 3. OtherConditions Agreed at Negotiations 19 H. Readinessfor Implementation 20 1. Compliancewith BankPolicies 20 ANNEXES Annex1. Programand Project Design Summary 21 Annex2. DetailedProject Description 25 Annex3. EstimatedProject Costs 37 Annex4 EconomicAnalysis Annex4.1 Cost-BenefitAnalysis Summary 38 Annex4.2 IncrementalCost Analysis 44 Annex5. FinancialSummary 49 Annex6. Procurement,Disbursement and Financial Management Arrangements 52 TableA. ProjectCosts by ProcurementArrangements 57 TableAl. ServiceSelecbon Arrangements 58 TableB. Thresholdsfor ProcurementMethods and Prior Review 59 TableC. Allocationof Loanand Grant Proceeds 60 Annex7. ProjectProcessing Budget and Schedule 61 Annex8. Documentsin the ProjectFile 62 Annex9. Statementof Loansand Credits 64 Annex10. Countryat a Glance 66 Annex11. SocialAnalysis and Participatory Approach 68 Annex12. SummarySite Assessments and Implementation Strategy 70 Annex12.1 LeaseIslands Site 70 Annex12.2 TakaBone Rate National Park Site 71 Annex12.3 ConflictResolution Framework for TakaBone Rate 72 Annex12.4 SitesProposed for GEFFinancing during COREMAP II 76 Annex13. Letterof DevelopmentProgram from the Govemmentof Indonesia 77 Annex14. Summaryof ProposedAdaptable Program Loans and GEF Grants 79 Annex14.1 CoralReef Rehabilitation and Management Project (Initiation Phase) 80 Annex14.1.a Checklistfor Evaluationof Fullfillmentof Conditionsto Proceedto COREMAPII 82 Annex14.2 SecondCoral Reef Rehabilitation and Management Prcject (Acceleration Phase) 84 Annex14.3 ThirdCoral Reef Rehabilitation and Management Project (Institutionalization Phase) 86 Map Indonesia Coral Reef Rehabilitationand ManagementProject Project Appraisal Document EastAsia and PacificRegion Date: March4,1998 Task Team Leader: Sofia Bettencourt NaturalResource Economist, EASRD CountryDirector: Dennisde Tray, EACIF SectorManager: Geoffrey Fox, EASRD Project ID: ID-PE-36048 Sector: Environment ProgramObjective Category: Environmental.Sust. Dev. GEF Supplement ID: ID-GE-40062 Focal Area: Biodiversity LendingInstrument: AdaptableProgram Loan (APL) Programof TargetedIntervention: [X] I Yes [ No Program Financing Data (US$ Million Equivalent) IBRD/GEFFinanced Projects Other Donor Financed Total COREMAP Program Projects* Program Phases IBRD APL GEF GOI Total Donors GOI Total US$M % US$M % US$M % US$M % US$M US$M US$M US$M COREMAPI 6.9 54 4.1 32 1.8 14 12.8 100 13.3 7.0 20.3 33.1 COREMAPII 25.0 59 7.5 18 10.0 23 42.5 100 57.5 10.0 67.5 110.0 COREMAPIII 35.0 70 .... 0 15.0 30 50.0 100 55.0 15.0 70.0 120.0 Total 66.9 64 11.6 11 26.8 25 105.3 100 125.8 32.0 157.8 263.1 Type Loan Grant Loan/ L __ _ _I I_ __ I___ _ I_ I _ __ _I_ _ G rant _ _ _ _ _ _ _ _ _ _ _ _ _ _ Otherdonors expected to includeADB and AusAlD, and JICAin phase 1/. Otherdonors' financing is estimated. ProjectFinancing Data [X] Loan [] Credit I ] Guarantee [xl Grant [ Other Amount(US$m): US$6.9 million IBRDLoan SDR 3.1 millionGEF Grant(US$4.1 millionequivalent) Proposed terms: [ Multicurrency [x] Singlecurrency, US$ Graceperiod (years): 3 [] StandardVariable [x] Fixed (1 LIBOR-based Yearsto maturity: 15 Commitmentfee: 0.75% Servicecharge: Nil Financingplan (US$M): Source Local Foreign Total Government 1.5 0.3 1.8 GEF 2.1 2.0 4.1 ...................................................................................................IBRD ........................................................................................................................................................3.6
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