Republic of Bolivia Country Strategic Opportunities Programme

Extended Summary of IFAD EB 2007/92/R.14 - Republic of Bolivia Country strategic opportunities programme Summary

The amount of IFAD funding available during the COSOP implementation period is based on the annual allocation established for COSOP year 1, which amounts to approximately US$6,078,495 (table 1). The allocation for Bolivia from the Seventh Replenishment (2007-2009) is calculated at US$18,336,140. (par. 5)

The present IFAD results-based country strategic opportunities programme (COSOP) is the second for Bolivia; the first one was prepared in 1998. Preparation of a new COSOP has been delayed as a result of several changes in government administration in recent years. This document is the result of extensive consultations with Government authorities, potential beneficiaries of future IFAD interventions and the donor community in Bolivia. As agreed with Government authorities, this COSOP will cover the period 2008-2012. (par.1)

Poverty in Bolivia has not changed significantly since 1998, and the country’s income-inequality level is one of the highest in the region. Bolivia has been attempting to implement poverty reduction strategies since 2001, but political and social circumstances have made this difficult. The current Government has prepared the National Development Plan for 2006-2010, which includes poverty reduction targets and priorities, and sector-based strategies. Linked to the National Plan, the Ministry of Rural Development, Agriculture and the Environment completed the preparation of a sector development plan in 2007 with specific strategies for rural development. (par. 2)

In the context of the national and sector development plans, the following two strategic objectives have been agreed upon with Government authorities for this COSOP. (par.3)

• Strategic Objective 1: Enhancing the livelihood assets (human, natural, physical, cultural and social) of the rural poor and promoting the adoption of technological and knowledge innovations by supporting the access of the poor to a wide range of services. This objective responds to the Government’s strategic priorities to strengthen the economic and social capacities of poor and vulnerable populations. This objective also addresses the natural resources conservation and the promotion and adoption of knowledge and technological innovations.

• Strategic Objective 2: Sustainable management of natural resources in defined territorial areas, with due regard for sociocultural issues. The central thrust of this strategic objective aims to (i) promote products and services with a cultural content, (ii) further dialogue on policies, (iii) reaffirm citizen rights, and (iv) support organizational development. A strategic intervention in this regard aims to overcome the limitations present in the Bolivian lowlands, where there is a predominantly indigenous rural population living in extreme poverty and vulnerability, but possessing considerable knowledge and natural resources, which could enable them to organize and implement processes conducive to territorial development and social inclusion. Partnerships: The Ministry of Development Planning is the representative of the borrower, while the Ministry of Rural Development, Agriculture and the Environment is IFAD’s counterpart on substantive and technical matters. Other national and regional agencies have participated in the implementation of IFAD-funded projects. Operational agreements could be strengthened and expanded progressively with regional and municipal governments (the prioritized 148) on the basis of agreements already in existence under current projects. Partnerships with local communities and organizations will be intensified as new territorial development approaches take hold and the direct transfer of resources, decisions and responsibilities are reaffirmed. Partnerships to improve campesino capacities to innovate and increase productivity will be established with international research centres. The main partners for natural resources management include the Centre for International Forestry Research and the German Agency for Technical Cooperation and, for financial services, the Swiss Agency for Development and Cooperation and CAF. Contacts made with a significant number of donors during COSOP preparation have shown that it is possible to forge alliances and collaboration agreements in pursuit of strategic objectives. (par.35)

Risks and risk management: Programme implementation entails four main risks. The first is of a general legal, institutional and policy nature related to the transfer of resources to individuals or families as opposed to larger community groups. The financial services initiative for savings mobilization based on conditional cash transfers to poor rural women, although approved by Government authorities, may be subject to further review. This risk can be minimized by a rapid inclusion of individuals and organizational entities so that they benefit from access to financial services, thus creating a consensus on the benefits of the approach. A second risk is of a political and operational nature; it sees the authorities changing a decentralized participatory approach to a centralized one, i.e. moving towards technical assistance services, centrally planned and delivered, including the provision of inputs. IFAD’s focus on poor communities and markets related to their interests and the use of co-financing of small amounts can help mitigate this risk. A third risk revolves around the capacity of indigenous beneficiary groups to take advantage of the corresponding market opportunities and other project-induced activities. Interventions based on the direct transfer of financial resources to beneficiaries reduces this risk by ensuring a high degree of community oversight and a high level of ownership of the investments within a stronger cultural and territorial framework. (par.39)

Finally, a fourth risk is related to climate conditions. Bolivia’s extreme vulnerability to poor climatic conditions could affect negatively the results and impacts of poverty reduction investments. To mitigate this risk, it will be necessary to include adequate provisions and incentives in all future operations so as to increase the value of biodiversity and local knowledge aimed at confronting eventual natural disasters and contributing favourably to reducing the effects of climate change in Bolivia and elsewhere. (par. 40)