‘Complementary financing for Environment in the context of Accession - Innovative sources’

National level analysis Country: Bulgaria

Authors: Maya Todorova Yuliya Grigorova and Yanka Kazakova

August 2007 Citation and disclaimer

This report should be quoted as follows:

Todorova, M., Grigorova, Y. & Kazakova Y. 2007. Complementary Financing for Environment in the Context of Accession – Innovative Resources: National Report Bulgaria. A project for the European Commission (contract 070201/2006/443879/MAR/E3). WWF Danube Carpathian Programme. 35 pp + Annexes.

The contents and views contained in this report are those of the authors, and do not necessarily represent those of the European Commission.

WWF is the world largest and most effective conservation organization. The mission of WWF is to stop the degradation of the planet’s natural environment, and to build a future in which humans live in harmony with nature, by: conserving the world’s biological diversity, ensuring that the use of the renewable natural resources is sustainable and promoting the reduction of pollution and wasteful consumption.

WWF Danube Carpathian Programme (WWF DCP) is responsible for leading and to a significant extent implementing WWF’s efforts to preserve, restore and sustainably manage the natural values of the Danube-Carpathian ecoregions.

2 TABLE OF CONTENTS

1 CHARACTERISTICS OF THE CASE STUDY AREA...... 4

2 SWOT ANALYSIS...... 18

3 DEVELOPMENTS AND PRESSURES ...... 19

4 VALUE OF BIODIVERSITY ...... 22

5 SELECTION OF STUDY SITES...... 22

6 OPPORTUNITY COSTS OF MAINTAINING BIODIVERSITY ...... 25

7 PAYMENT FOR ENVIRONMENTAL SERVICES ...... 28

8 INTERPRETATION OF RESULTS...... 32

9 SUMMARY AND RECOMMENDATIONS ...... 33

10 ACKNOWLEDEGEMNTS, DATA SOURCES, REFERENCES AND DATA ANNEXES ...... 35

3 1 CHARACTERISTICS OF THE CASE STUDY AREA

Geographic location and boundaries The Natural Park of Roussenski Lom is a natural complex of ecological, historical and cultural significance. The park is located in the northeast of Bulgaria, in the canyon-like valley of the Roussenski Lom River, the last major right tributary of the Danube before it spills into the Black Sea. The area was designated as a nature park in 1970. Covering an area of 3,408 ha, the Park includes territories of 2 districts: Rousse district, including Ivanovo and Vetovo municipalities; and Razgrad district, including Tzar Kaloyan municipality. Following the planned extension of the park boundaries, its area will increase 3 times to about 10,000 ha, including more territories of Rousse municipality towards Rousse and Vetovo. The boundaries will extend to Vetovo, Krivnia, Senovo in the East; Rousse, Tabachka, Shirokovo to Ostrica in the West; and Svalenik in South. With these additional territories, the Park will rank sixth among all 10 natural parks in Bulgaria in terms of area.

Map 1. Current (blue) and future (blue and red) boundaries of Natural Park Roussenski Lom

The whole territory of the park is divided into four zones in terms of their functions: • Visiting zone – includes settlements (villages) serving as points of departure to the park • Recreation zone (approximately 48% of the park) – includes the river valley of Mali Lom and the pertaining forest areas • Historical zone (ca. 19%) – includes historical sites in Ivanovo municipality • Zone under strict protection (approximately 32% of the park) – this zone includes the river valley of Beli Lom and the adjoining forest areas between Pisanec and Nisovo.

4

Zones will be redrawn following enlargement of the park. Four rivers cross the territory of the park: the Roussenski Lom, Beli Lom, Cherni Lom and Mali Lom rivers. The Roussenski Lom River is the last major right tributary of the Danube before it spills into the Black Sea. The river is formed by the Beli and Cherni Lom Rivers. Before merging, the two rivers have a length of 130 km for the Cherni Lom and 140 km for the Beli Lom and a drainage basin of 1,549 km² and 1,276 km², respectively. Both rivers primarily run northwestwards, with the Beli Lom going west at Senovo and the Cherni Lom flowing northeast after Shirokovo, as the two rivers get closer to merge north of Ivanovo. The Roussenski Lom empties into the Danube at the city of Rousse, which gives the river its name, with a total length from the source of the Beli Lom being 196.9 km. There are underground reservoirs, but they lie deep under the loess sediments. In the river valleys, underground water can be located superficially, at 1-3 m depth. There are karst springs along the river valleys, some of which are used for water supply. In general, the Loms’ waters can be used for animals and fish farming, but should be purified before they are used for drinking and food preparation.

Soils The main soil types are black earth (chernozem) – represented by leached calcareous chernozem and leached chernozem as well as alluvial soils. Chernozems have favourable physical characteristics for agricultural production – loose, good aeration, high porouseness. The soil horizon varies between 30 and 80 cm. The humus content is within 1.6 and 3%. Alluvial soils are spread in the river valleys. Their soil horizon is 100- 150 cm, and humus content is 2-2.8%. Most agricultural lands are on alluvial soils, which are highly fertile and suitable for cultivation of cereals, industrial crops, vegetables and perennial plants. According to the Park management plan from 2002, erosion measures are not to be undertaken in the park boundaries because forest areas have light erosion, and agricultural lands are not eroded.

Biodiversity On the territory of Roussenski Lom Nature Park there are 29 habitat types as defined by CORINE from them 17 habitats are in the group of the ones needed strict protection. The CORINE classification is basis for the identification of the habitats of high priority, namely: • Aquatic with floating cormophytes ( Lemna sp. div., etc.); • Riparian, spring and marshy fresh-water with hydrophilous and hygrophilous vegetation. • Riparian terraces with reach well-moisture soils with hygro mesophil оus and mesophilous wood and grass vegetation; • Trampled often nitrified soils with ruderal vegetation; • stone walls and cracks, screes and eluvia with hasmophyte vegetation; • Fields near steep areas exposed mainly to north with well developed moderately to weakly moisturized soils with mesophyte and xeromesophilic vegetation; • Fields near steep areas exposed east and west with well-developed and moderately moisturized soils with mesoxerophyte and xerophyte vegetation;

5 • Steep mesotherm and xeromesotherm slopes with rock disclosures covered with xeromesophilic vegetation; • Xerotherm areas with eroded soils with xerophilous grass and shrub vegetation. The whole area within the current boundaries of the Park has been proposed as a Natura 2000 site.

Woodlands The total area of woodlands (forests and lands) in the Park is 2,808 ha, which is approximately 67% of the park territory. 2,281 ha of the woodlands (81.3 %) is afforested. There are 27 tree species. Oriental hornbeam occupies the largest area – 573.1 ha (25% of the afforested areas), followed by black locust (Robinia pseudoacacia L.) – 508.9 ha (22.3%) and Turkey oak (Quercus cerris ) – 443 ha (19.4%). The main part of the park is occupied by local species. Forests are mainly deciduous, occupying 265.5 including oak, and ash among others. Coniferous forests occupy about 66 ha, represented by pine trees and mixed coniferous- deciduous cultures.

Flora Flora is represented by 825 plant species, 27 of which are sub-species. The park is the only place where Polygala sibirica and Verbascum dieskianum can be found -- highly vulnerable species with extremely small populations . Galium rubioides, Anemone sylvestris, Chamaecytsus kovacevii, Stenbergia colchiciflor, Astragalus ha аrbachii all have small populations within the park There is only one place in the Park, where the rare Batrachospermum moniliform e can be found and it is highly vulnerable due to water contamination. The hydrophilous species along the rivers are vulnerable and under the EU conventions protection. Other highly vulnerable species in the Park are: Galanthus nivalis, Orchis tridentata , Orchis simia, Orchis purpureae,Orchis morio, Himanthoglossum hircinum, Cephalanthera longifolia, Cyclamen hederifolium, Cephalanthera damasonium. There are 95 species of macrofungi, 5 of them of special conservation significance. Most of the species are found in deciduous forests. Among them are 23 valuable edible species, including Agaricus campestris, Armillaria mellea , Boletus aestivalis, Cantharellus cibarius, Craterellus cornucopioides. Fauna The variety of climatic conditions and habitats contributes to the high diversity among animal species. Six protected insect species have been identified: the red wood ant ( Formica rufa ) and caterpillar-hunter ( Calosoma inquisitor ), Calosoma sicophanta , stag beetle ( Lucanus cervus ), Oryctes nasicornis and Saturnia piri . There are 22 fish species identified, with L.cephalus dominating in the area. The Beli Lom and Cherni Lom rivers are rich in fish, while the Mali Lom and Roussenski Lom are poor. There are 5 highly vulnerable, 7 moderately vulnerable and 12 somewhat vulnerable fish species.

6 Field researches have identified 5 amphibian and 19 reptile species – all of them breeding in the Park. The number of some of the most vulnerable reptiles ( E. quatuorlineata , O. apodus , C.austriaca ) has decreased because of the direct destruction by man and breaking of meadows in the Park.

Roussenski Lom Nature Park has a diverse population of birds with 174 species (122 of them breeding in the Park), some of which are endangered in Europe, such as B. rufinus, A. pomarina, C. coturnix, B. bubo, L. arborea, E. hortulana, E. melanocephala. The Park is one of the top 5 important places for nesting in Bulgaria. Roussenski Lom Nature Park is home to 70 species of mammals, including: • 30 species protected under Bulgarian laws and 41 under the Bern convention; • 25 of the 29 bat species found in Bulgaria, dwelling in caves and old forests with hollow trees. • 20 rodent species • steppe species extremely rare for the Bulgarian fauna • 14 hunting mammal species, such as wild boar, red deer, rabbit, wolf, jackal, fox and wild cat

Seven habitats in the Roussenski Lom area that are of high biodiversity significance according to the EU Habitats Directive are listed in Annex 2, Table 5. The table below represents the top sites of highest biodiversity value in the area. Some of the places are within the current boundaries of the Park, while others are to be included after the enlargement of its area. When determining the sites, attention has been focused on both biodiversity and farming practices, so that sites are representative for the area.

Table 1. Sites of highest biodiversity value in the area TOP HIGH BIODIVERSITY VALUE AREAS Name(1) Biodiversity Approximate Where is it Interaction between Description (2) land cover in biodiversity and study area (ha. farming practices and and/or other land percentage) use interactions 1 Basarbovo A rare, well-preserved The area The area abuts on habitat of loess steppe includes the agricultural lands. grass societies, pastures The pastures are included in Natura located in the used for grazing. 2000 – 6250; there are south and east Mainly cows are species that are of Basarbovo bred in the area. The endemic to Bulgaria village, Rousse current land use and to the Balkans. A municipality, intensity permits high percentage of the which are maintaining a good vegetation is natural. currently not biodiversity status included in the Park area 2 Shtraklevo Hamster The area Mainly cattle- communities; includes the breeding is endemic species; Bird pastures developed; Farming species protected situated near practices under the Birds the village of characterized by

7 Directive feed in this Shtruklevo, intensive grazing area, including booted Ivanovo leading to depletion eagle ( Aquila municipality of pastures at a Pennatus ), long- higher rate. At the legged buzzard ( Buteo same time, intensive rufinus ) farming maintains the hamster communities. 3 Svalenik Steppe plant species The area is Highly developed located in the intensive livestock river valley of breeding. High Mali Lom concentration of river, Ivanovo animal units per ha; municipality problems with household and agricultural waste management 4 Bataklia Area rich in wild Located near The area is a state animals – roe deer, the village of game-breeding wild boars, red deer Pisanec, within station and hunting is the boundaries well developed. Wild of the Park, animals visit the Vetovo surrounding municipality agricultural lands to feed. Farming practices permit the maintenance of a good biodiversity status. 5 Nisovo Area with various Agricultural Agricultural lands plant and animal lands and fish where intensive species such as Black farms forming farming practices are stork, Egyptian a ‘hollow’ area applied, including vulture; meadows and in the park use of pesticides pastures Nisovo village, dangerous to rodents Ivanovo and birds; pollution municipality of groundwater. Intensive fish farms provided on concession by the municipality negatively affect bird species that use the farms for feeding. Breaking of meadows for arable land. Development of eco tourism, which is often unsustainable, with e.g.visits of tourists to Black stork nesting places.

8 6 Mali Lom Riparian mesophilous Located near Meadows, mostly meadows meadows Nisovo, on the private and not Mali Lom cultivated. In the riversides, springtime herds of Ivanovo cows pass through municipality the meadows, leading to their degradation 7 Dolap Dere Riparian meadows Located near Intensive agriculture with characteristics the village of – conversion of similar to Mali Lom Tabachka, meadows to arable meadows Ivanovo lands municipality 8 Tabachka Willow riparian Between Adjoining to forests, spread in the Tabachka and agricultural lands whole area in the past, Cherven, and thus, threatened now located only in Ivanovo by hewing the forests this place municipality and using the lands for agricultural purposes 9 Fish farms Important to bird Fish farms Most fish farms have species such as Black located in been abandoned, but Stork, Egyptian several places trends show vulture, who find food within the park increasing interest in there boundaries – fishing industry and Krassen, thus more intensive Basarbovo, use of the farms Ivanovo, causing a negative Nisovo, influence on the Svalenik, number of bird Pisanec species 10 Tourism sites Important bird and Eco tourism is Intensive eco- plant species developed near tourism practices Ivanovo and contradict with Nisovo natural process of wildlife species – birds nesting, etc.

Land use and structure Land within the current park boundaries consists mainly of woodlands (67%), followed by meadows and pastures. Agricultural lands within the park boundaries comprise insignificant share (appr. 600 ha out of 3,408 ha total area). The land structure will remain relatively the same after the enlargement of the Park. Woodlands will occupy the largest area. More natural pastures and meadows will be included. In terms of ownership within the Park, land is state-public, municipal and in private hands – with the latter relatively insignificant, comprising only 287.6 ha out of the total 3,408 ha. In the enlarged area of the park, state-public lands will comprise the greatest share. Since Beli Lom strict reserve will be included within the boundaries of the park, there will be areas of high concentration of state ownership.

9 Land belonging to the municipalities 1 is mainly agricultural. The share of agricultural land in total land use structure is 92%. The trend in land use structure has been relatively stable. Agricultural lands are mainly arable lands comprising 54,700 ha, meadows and pastures comprising 4097 ha, and perennial plants. In terms of ownership outside the Park, more than 60% of the land is private – this is mainly agricultural arable land. A problem is the fragmentation of land in small lots among generations of heirs. The problem of lands identification and mapping is under development. In Tzar Kaloyan municipality, this process is completed. There are large areas owned by the municipalities. These are mainly meadows and pastures, which according to new legislation should be ceded without charge to farmers for use. There have been several sales of municipality land, mainly forests and afforested areas. Nevertheless, it is expected that the amount of land owned by municipalities will increase. The reason for this is the existence of many lands that have “unknown owner” status. According to the legislation 2, a municipality can use and manage land left after the restitution of the owners’ rights following the enforcement of the Land Division Plan and an empowering decision made by a commission consisting of representatives from the Municipality agriculture and forestry service, Agency of geodesy, cartography and cadastre, and the Forestry service. These are large areas usually comprised of meadows and pastures. In addition, there are many deserted lands, mainly in private hands. Some of the problems mentioned above are temporally solved by renting lands to big leaseholders, including small lots in cooperatives, but it is uncertain how these lands will be managed. In 2005-2006 many agricultural lands were purchased by Bulgarian investment intermediaries for the foundation of Agricultural Land Opportunity Funds, which is a real estate investment trust (REIT) for investments in agricultural land. Their intention according to official information is to form large agricultural massives, if necessary by exchanging land lots, rent the massives to local tenants for 5 years and after sell it. 90% of this land is already in use – rented.

Table 2. Information on most important land uses (agricultural/forestry) by area (including the identified biodiversity friendly farming practises) TOP LAND USES IN STUDY AREA Name Description (1) Approximate land Biodiversity Interaction between farming Indicato cover in study existing/affe practice and biodiversity r of area (ha. and cted by the interacti percentage) land-use on (2) 1. Agriculture is the Agricultural fields Meadows, - Habitat loss and destruction Agricultu main activity. Main area is 59,367.7 ha bird species, through agriculture expansion; re – crops cultivated are (62%); forests - Contamination of the soil because pastoral cereals (wheat, Perennial plants of pesticides and fertilizers used in arable barley, maize and 1,014 ha (2%). agriculture; oats) and industrial - Contamination of underground plants (sunflower and open water sources with and tobacco). pesticides These crops occupy - Disturbance of communities approximately 80% - Conversion of meadows to of arable lands. The vineyards

1 Some of them included in the park – mainly forests, meadow and pastures 2 See Art. 19, Law on the ownership and agricultural land use. In the beginning of 2007, Art. 19 was amended. Before such lands could be used by municipalities and if no person claimed ownership on them in a 10-year-period they became municipalities’ ownership. These lands could not be included in EU projects, which made their sustainable management difficult.

10 rest of arable lands - Use of aviation for pest control are orchards and vineyards. 2. Poultry and sheep 4,902 ha meadows Meadows - Extensive animal breeding; Agricultu breeding are well and pastures (5%), and natural - Use of meadows for grazing, re – developed in the fodder areas not vegetation which in springtime leads to pastoral area. The included destruction of natural vegetation farming availability of - Unregulated and uncontrolled pastures and well- storage of compost developed fodder - Farming practices help maintain base are conditions meadows in good condition for for the hamster societies development of goat, cattle and goat breeding. 3. The road network No data No data No data No data Urban/ro in the region ads includes roads from the Republican network and roads in the villages and forests. Road infrastructure is well developed in Ivanovo, in Tzar Kaloyan and partially in Vetovo. Roads in the villages require total repair. To solve this problem municipalities count on EU finds for infrastructure development 4. Forests comprise 14,529.6 ha (15%). Natural tree The local forestry enterprises and Forestry the second largest species the state forestry department are areas after responsible for the conservation of agricultural lands. forests; in some places original Forests occupy forests were destroyed and approximately converted to arable lands. Willow 2,800 ha within the riparian forests are especially park boundaries exposed to the risk of destruction and are mainly and conversion. deciduous. There is an area for timber industry.

5. Waste Near the villages No data - Loss and Solid and organic waste is managem there are many degradation considered as the most serious ent non-regulated of habitats; problem. Currently, all official waste places used - Toxic waste depots from the area should by households and effect be closed and all waste will be farmers through transported to the central Rousse pollution waste depot. This will create problem for the Egypt vulture who used to find food there. 6. Tourism is No data - Karst Intensive eco-tourism practices Tourism developed but still forms and contradict with natural process of needs more caves wildlife species – birds nesting,

11 marketing and - Bird bats improvement of species - services and Booted accommodation. Eagle The area is (Aquila destination of rural, Pennatus ), eco and history and Long-legged culture tourism, buzzard rock climbing, cave (Buteo exploration – in rufinus ), park and the Egypt neighbouring areas vulture are located one - plant national reserve, species history and culture sites included in the World Herritage list of UNESCO, Orlova chuka cave offering opportunities for cave exploration 7. There are 11 fish 16 ha Bird species Although they do not occupy large Fish farms in the area; areas, fish farms are important to farming mainly owned by bird species. The development of the municipalities fish farming is negative for bird and ceded to species that used to find food there, tenants for use. leading to a decrease in the number Some of them are of bird pairs not legal but still operate

Settlements and demographic characteristics

The area of the Park includes territories of 3 municipalities – Ivanovo, Vetovo and Tzar Kaloyan – comprising 23 settlements in total. The settlements are mainly rural (there are only 3 towns) and agriculturally-oriented. Ivanovo municipality has the largest area included in the Park. The population living in the area of the three municipalities is approximately 35,000 persons in total. Over the past four years, there has been a gradual decrease in the local population due to socio-economic changes and the consequent migration to cities of the economically active population. It is expected that the population will continue to fall because of the limited work opportunities in the area, resulting in further aggravation of population structure in general. In Tzar Kaloyan municipality, for example, the birth rate is above the average for the country but the migration of the population to larger cities and to Turkey more than outweighs this. This will deepen the problems with the work force. Municipalities are trying to keep economically active population in the area by organizing qualification training courses in rural tourism (Ivanovo municipality), as well as programmes for integrated development under the LEADER program (Vetovo municipality). The economically active population (ages 18-60) dominates in Vetovo and Tzar Kaloyan municipalities. In contrast, the age structure of the population in Ivanovo municipality is extremely aggravated. Among the reasons for the negative trend in the population structure of this most populated area in the territory of the Park is the proximity to a regional center (Rousse town) and limited opportunities for occupation mainly in agriculture requiring low-

12 qualified and less-paid work force. Despite the overall high percentage of economically active population, unemployment in the Roussenski Lom area is high – about 20% on average, mainly among the low-educated part of the population. There is a trend toward increasing the number of persons requiring social payments. The monthly income is the lowest in the country, varying between €40 (in the form of pension payments) to €100 (an average salary). The population is mainly employed in the agricultural sector.

Table 3. Current and future areas of the settlements included in the Roussensky Lom Nature Park Municipality Total area (ha) Area in Park (ha) Population Ivanovo 49,545.4 2,273.4 10,951 Vetovo 35,250.0 281.8 16,606 Tzar Kaloyan 16,196.0 852.8 7,246 Total 100,991.4 3,408.0 34,803

Agriculture 3 The climatic conditions, relief and the large share of agricultural lands on the territory of the 3 municipalities define agriculture as the leading economic activity in the area. Furthermore, the local economically active population is mainly occupied in agriculture, which is the main source of income. Natural conditions are favourable for cultivation of cereals, including wheat, barley and corn, as well as industrial crops including sunflowers and sugar beets. In Ivanovo municipality farmers also cultivate grapes for wine and fruits, including peaches and sour cherries. The share of crops in total crop production is as follows: ca. 85% cereals, 14% industrial crops, 2-3% vineyards and orchards. During the period 2001-2004 the production of cereals and industrial plants fluctuated, but has been decreasing since 2004. There are many farmers in the area cultivating tobacco, mainly in Tzar Kaloyan and Vetovo Municipalities. After the accession of Bulgaria to the EU their number will decrease because of the lower quotas for tobacco, which to date has fallen to 50%. This will make many tobacco growers either give up farming or change crops. Other industrial crops cultivated in the area are coriander, saffron, rape seeds, milk thistle, and fennel. The production of fodder and the availability of well-developed fodder is a condition for developing animal breeding. Poultry breeding is the most developed in the municipalities, followed by sheep and goat herding. Cattle-breeding is concentrated in Vetovo and Tzar Kaloyan municipalities. Fish farming and bee keeping are also well-developed. The number of apiaries has been increasing. Unfortunately, there is no data on fish farm production.

Table 4: Number of animal units in the municipalities in 2004 Livestock Ivanovo Vetovo Tzar Kaloyan Poultry 51,650 22,444 2,5000 Cattle 892 1,687 1,452

3 Most data in this section are taken from the Operational Plans for Development 2007-2013 of the 3 municipalities, which have been updated to 2004. After the registration campaign finishes, more accurate and up-to-date data will be available.

13 Goats 3,494 3,057 5,693 Sheep 7,952 7,558 4,328 Pigs 2,048 1,689 Bee families n.a. 7,099 n.a.

Trends in animal breeding reflect the ongoing restructuring of the agricultural sector, with a decrease in the number of animal units in the period 2000-2004. The number of milk cows is not expected to increase due to new EU milk quotas as well as the current low purchase price for animal products. In the villages there are many households breeding one or two cows, which makes it difficult to secure better prices for both inputs and products. It is typical that many farmers operate without registration because it is not required by law. Livestock breeding is developed mainly on private farms. In contrast, on plant-growing, agricultural lands are rented to tenants or included in cooperatives. Owners get annual payments after the harvest period amounting to €4-6 or receive a part of the production. In addition to private owners, municipalities also rent out their lands to tenants. In 2004, there were 62 tenants and cooperatives in Ivanovo and 6 cooperatives in Tzar Kaloyan. In 2004-2005, the number of registered farmers in the area was 79 in Ivanovo, 122 in Tzar Kaloyan and 482 in Vetovo. Nevertheless, it is certain that following Bulgaria’s accession to the EU and the ongoing process of farmers’ registration, the number of farmers will decrease because of higher requirements and standards, the obligations to pay taxes and social payments. More accurate data on dynamics in number of farmers will be available later in 2007 when the process is to be completed.

Industry Industry in the area is less developed. There are two large operating companies: one of them being the kaolin mine in Vetovo and the other a processing factory in Ivanovo. The processing industry is one of the main industrial branches in the area. On the territory of the 3 municipalities there are 7 dairies, 2 mills, 5 bakeries and one mushroom processing factory. The other main branch is the tailoring industry, with more than 30 tailoring enterprises that benefit from low production costs (less paid work force). Due to low salaries, the local population tends to move to nearby towns in search of better paid work. The tertiary sector is presented mainly by tourism. The Roussenski Lom Park and the absence of large factories make these places interesting for eco- and rural tourism development. On the territory of the three municipalities is Beli Lom Reserve, and the Natural Monuments Orlova chuka, Ribarnitsite and Mamula. There are several sites of high historical and cultural value within the Park, among them the Medieval town of Cherven and the rock churches that are included in UNESCO’s World Heritage list. Unfortunately, there are no statistics on the annual number of tourists in the area. Ivanovo municipality is the main focus for tourism. The number of the registered places for accommodation there is 6 houses, but it is certain that some people provide accommodation without registration. Also, the area is attracting the interest of foreign investors interested in developing eco-tourism businesses. Places like Bojichen, Pisanec, Ivanovo, Cherven can be described already as tourist destinations. The canyons attract many cave explorers and rock climbers.

14 National and institutional and administrative framework relevant to biodiversity Ministry of Environment and Water (MoEW) and particularly its four River Basin Directorates and 15 regional Inspectorates are responsible for the development and implementation of governmental policy on environmental protection, including air protection and control on water use and water protection, environmental conservation and protection including Natura 2000, natural protected areas and national park territories. The MoEW is responsible for the application and implementation of the National Operational Programme on Environment. According to current Bulgarian legislation, the Minister of Environment and Waters coordinates the functions of other ministries and departments in relation to nature conservation. Coordination is implemented at two levels: • At central level within MoEW exists Supreme expert environmental council, making decisions on Environmental Impact Assessments (EIA); • At local level, from the regional MoEW structures, which create expert councils with communities and other interested regional stakeholders. Directors of regional MoEW units organize protected areas management; control the activities of owners or users of forests, land and water areas; coordinate and control the application of management plans in the research field, maintaining and restoration measures for threatened species and habitats, educational and training environmental programs and other nature- conservation activities, implemented from other state units, municipalities, NGOs and individuals; organize monitoring over the qualities of environment components; and sanction violations of the above. The Ministry of Agriculture and Forestry (MoAF) and its local subdivisions make policies in the field of agriculture, including agri-environment policy as part of the National Agri- environmental Programme, Good Farming Practices and Natura 2000 measures. The MoAF is responsible for applying and implementing the National Programme for Rural Development and National Strategy Plan for Rural Development 2007-2013. The National Agricultural Advisory Service (NAAS) and its local services are responsible for the implementation of agricultural environmental policy by carrying out extension services and providing expert assistance to farmers in their efforts to achieve EU standards. The National Forestry Board and its subdivisions carry out and apply state policy in the field of forest and forest-environment activities and are responsible for natural parks management. The Park Administration Directorate is responsible for management, protection, conservation and restoration within the Natural Park. The regime of use and management of the Roussenski Lom Nature Park is fixed by the Regulation for Protected Areas and Nature Park Management Plan. Nature Park Directorates are units of the National Forestry Board for implementation of nature park management plans; the coordination, methodological guidance and control of implementation of park-structural projects within the Park; planning and organisation of scientific and educational programmes as well as promotional activities; organisation of visitors and information centres; organisation of actions for biological and landscape diversity conservation and restoration; tourism and recreation development in park territories and surrounding zones; as well as maintaining of archives and databases for the territories of the nature parks. Designation as a Nature Park does not change the ownership structure of forests, land or waters within the park, but owners and users must observe the protection regime. The division of responsibilities for management, protection, conservation and restoration in nature parks is

15 mainly defined in the Law on Protected Areas, the Law on Forests and ordinances of the National Forestry Board on the functioning of park directorates. District administrations and municipalities have the authority to develop environment conservation programmes in coordination with the MoEW, MoAF and Ministry of Health, where this is possible. They are responsible for the management of municipal environmental funds, the protection of air, water and soil from pollution, the collection of waste from households and their proper management. The Ministry of Culture and the National Institute for Cultural Monuments together with its regional structures is the responsible for maintaining and managing the monuments of culture within protected areas. The Ministry of Health and its 28 sanitation-epidemic inspectorates exercise control on the air, water, soil and food status and their impact on human health. Existing administrative procedures and practices Bulgaria is a party to almost all of the global and common European conventions related to environment and nature conservation, including the Convention on Biological Diversity, the Convention on the Conservation of European Wildlife and Natural Habitats (Bern Convention), the Convention on Wetlands of International Importance Particularly as Waterfowl Habitat (Ramsar Convention), the Convention on the Conservation of Migratory Species of Wild Animals (Bonn Convention), and others. Environmental protection is officially anchored in Bulgaria’s constitution. According to Article 15 of the Constitution, “the Republic of Bulgaria provides for the protection and reproduction of the environment, the maintenance and diversity of nature and sensibly use of nature and the country’s resources”. In other words, care for the environment is a central function of government. It is also important to emphasise that Article 5 of the Constitution, which provides the framework for implementing laws, gives priority to international over national legislation and apply after their ratification and publication even where they may contradict existing national legislation. The structure of Bulgaria’s national environmental legislation is divided traditionally into common law and special laws/acts for single natural resources and environment components. The framework Law on Environmental Protection regulates the principal common formulations (Environmental Impact Assessments, Integrated Pollution Prevention and Control, rights for public access to environmental information, economic regulators). It contains fundamental principles of contemporary environmental policy and legislation such as the “polluter pays” principle, “precautionary principle” and regulates tax payment for environment pollution within the permissible rates. Conservation and sustainable use of biodiversity in the country is determined by 3 regulations and sub-regulation normative acts (Law on Protected Areas, Law on Medicinal Plants, and Law on Biodiversity). Overall regulation of the conservation and use of relevant bio-resources and biodiversity is established in sector regulations covering both natural and semi-natural resources and landscapes (Regulation for the Conservation of Agricultural Lands, Regulation for Property and use of Agricultural Lands, Regulation for Protection of New Plant Varieties and Stock Breeds, Regulation of Forests, Regulation of Hunting Reserves and Game Conservation, Regulation for Fisheries and Aquatics, Regulation of Veterinary-medical Affairs, etc).

16 At this stage, the development of economic measures for environmental policies is limited. The specific national economic mechanisms related to environmental conservation and the internal market include taxes, charges, customs and excise duties. Enterprises and individuals pay sanctions and fines for water, soil and air pollution above permissible limits. The revenues are allocated between the National Environmental Conservation Fund (NECF) and community funds in a proportion of 70:30. Typical environmental charges include ones for environment pollution within the permissible rate, from which revenues are allocated between the NECF and communities in proportion 40:60. The fund is also fed by administrative charges paid for permits, licences, etc. 5% of sales of public property (state and municipal) go to the NECF or municipal environmental funds. According to the operating special resource regulations, charges are paid for timber, herbs, game extraction and also for changing the purpose of lands from forest and agricultural funds to construction and industrial uses. Unfortunately, the environment is missing in tax legislation, with no “green” taxes, incentives or other economic mechanisms currently in place. There are no developed methods for natural resource cost assessment which would help integrate environmental principles into economic ones. The National Rural Development Strategic Plan 2007-2013, Operational Programme Environment 2007-2013, National Environment Strategy 2005-2014 and National Biodiversity Conservation Strategy formulate and specify a policy of sustainable development and preservation of Bulgaria’s natural resources. For future Natura 2000 sites, mandatory management guidelines for land use are determined by management plans, which are developed by the relevant protected area authorities. Designation of protected areas does not change the ownership of land, forests and water within their boundaries, but owners and users are obliged to observe the conservation regime for the area. As a result, land is not always profitable for farmers who are managing them because prices paid by consumers do not include the additional value to the environment that the farmer creates in following conservation guidelines for the land rather than using intensive agricultural production. Support from the National Rural Development Strategic Plan , National Agri-environmental Programme and Natura 2000 measures should provide opportunities for farmers to be paid for these environmental products and services. Unfortunately, there is no experience with agri-environmental application and management at national level due to the late accreditation of the SAPARD Programme agri-environmental measure.

Delivery structures in place Management of nature and national parks, protected areas and natural resources is the task of the MoAF and the National Forestry Board. Officers of these two organisations are well educated and technically trained. In spite of this, local sub-divisions face limited budgets, insufficient skills for application and management of agri-environmental payments and payments for environmental services, and work with public as well as limited practical experience. It is necessary to fill in these gaps as well as create opportunities for the government and local authorities, which provide further management and maintenance of protected areas. It is important to create effective control structures and monitoring systems. It is necessary to better coordinate and consolidate capacity for applying agri-environmental policies between the Nature Park Roussenski Lom Nature Park Administration and the muncipal administrations of Vetovo, Tsar Kaloian, Ivanovo and Rousse.

17 Basic funding for environmental projects is outlined in the national operational programmes: the Operational Plan for Environment, the Operational Plan for Regional development, the Operational Plan for the Competitiveness of the Bulgarian Economy and the Operational Plan for Transport as well as the Rural Development Programme and Fisheries and Aquaculture Programme. Funding is is envisaged through the European Structural Funds, Rural Development Fund and Fishery Fund as well as national co-financing for each program. Local municipalities and other structures and organisations, including businesses and physical persons will be able to apply for implementation of projects with positive influence on the environment.

2 SWOT ANALYSIS

Box 1. SWOT analysis for Roussenski Lom Nature Park Strengths Weaknesses Ecologically clean area without large industrial Agricultural intensification: farming practices facilities; characterized by monoculture cultivation of wheat, barley, oats, sunflowers and maize; Favourable conditions for agriculture, including intensive grazing leading to depletion of flat area with generous soils as well as an pastures at a higher rate; intensive use of abundance of underground water for irrigation in pesticides and herbicides that are toxic to small Vetovo municipality; anaimals and birds and pollute groundwater; Developed middle- and small-sized businesses breaking of meadows; and farms; Economically active population Abandonment of agricultural land; available in Ivano and Tzar Kaloyan; Intensive private fish farms negatively impact Rich mosaic landscape with relatively high bird species that use the farms for feeding; percentage of woodlands, large areas of pastures and meadows. Developed tourism – in many cases, unmanaged tourism disturbs Black stork nests; Developed agriculture and fodder base with favourable conditions for development of Use of outdated and amortized agricultural ecological agriculture; developed bee keeping and machineries; fish farming. Lack of awareness and understanding among Favourable conditions for development of eco- local farmers of the EU Common Agricultural and rural tourism, with rich store of natural and Policy; cultural heritage as well as attractive landscape. Numerous, unregulated waste dumps for Significant biodiversity values, including: 825 household and agricultural waste; species and subspecies of higher plants, 23 of Plant species: There is only one place in the them having conservation significance; 95 species Park, where the rare Batrachospermum of macrofungi, 5 of them of conservational moniliform e can be found and it is highly significance; 8 endemics ( Chamaecytsus vulnerable because of water contamination. kovacevii, Potentilla emili-popii ), one of which is endemic to Bulgaria and the another to the Hygrophilous species along the rivers are Balkans; and one relict ( Celtis caucasica Willd); vulnerable and under the protection of EU ca. 80 plant species with significant economic conventions. Other highly vulnerable species values (medical plants, industrial plants, etc.); 30 with limited distribution in the park: Galanthus animal species protected under Bulgarian law and nivalis, Orchis tridentata , Orchis simia, Orchis 41 under the Bern Convention; 174 bird species. purpureae,Orchis morio, Himanthoglossum hircinum, Cephalanthera longifolia, Cyclamen

hederifolium, Cephalanthera damasonium.

18 Opportunities Threats Training courses, advices and rising of awareness Deepening of demographic problems – labor on organic farming; migration of young people; Infrastructure development; High water prices; Increasing quality of agricultural products; Soil and water contamination; Assistance to farmers to access international Opening of new factories of the processing markets; industry for processing of agricultural production; Cultivation of medicinal plants; Higher profits from intensive agriculture; Cultivation of herbs; Land abandonment and further fragmentation. Renewal and development of irrigational

agriculture; Development of alternative and organic farming; Development of eco- and rural tourism; Participation in EU projects.

3 DEVELOPMENTS AND PRESSURES

A key problem – not only in the Roussenski Lom but also in Bulgaria more generally – are slash and burn practices. Even though forbidden by law, farmers continue the practice of burning stubble fields leading to the destruction of the humus and loss of animal/plant species. Another major problem in the areas around settlements is the deposit of waste from households and agriculture (animal breeding mainly) in improper open places leading to the contamination of soil and underground waters. Application of chemicals on the agricultural lands close to the Park threatens the animals and bird species. In some places, inappropriate tourism has caused rare bird species to abandon their usual nesting areas, e.g. Black storks in Nisovo. Before 1990, abandoned fish farms provided a quiet place rich in food for the Black stork. At present, however, newly leased fish farms have halved the number of bird pairs. Human activities have resulted in a sharp decrease in the number of the Egyptian vulture from 10 nesting pairs to ca. 3-4 today. The reasons for this decrease are the visit of tourists and the closing of regulated waste dumps of the villages. Another problem resulting from extensive livestock breeding is the uncontrolled and unregulated use of meadows for grazing (instead of pastures) – this is the case in Svalenik and Nisovo. This farming practice has lead to the degradation of the natural vegetation. The abandonment of agricultural lands (pastures) in the area has resulted e.g. in the decrease in the number of hamster populations. Due to the intensive economic activities (plant-growing and animal breeding) in the drainage basin area of the Roussenski Lom River and its tributaries, the contents of ammonium and nitrate nitrogen deviate greatly. Because the area is mainly rural, many villages have either partial or no sewage system. The waters of the rivers are contaminated every day with animal and households waste. The water of the Roussenski Lom River is used mainly for irrigation and industrial purposes.

19 Beli Lom river is polluted by 21 settlements, but the main polluters are situated in Razgrad (a factory of the industrial microbiology, an old refining station) and in Dyakovo village (a pig farm). Thanks to the tailing dam in Vetovo, the river self-cleans partially. Mali Lom waters are relatively clean. The main contaminators are the farms in Svalenik and Nisovo. Cherni Lom is contaminated mainly by Popovo town and 26 other settlements. Thanks to the good self-purification, the river still has good water quality. Other consumers of the river waters are the fish farms. They used to fill in once and then add water with deviation from the water quantity of a given river, breaking the naturalness of the water body.

Table 5. Information on significant trends in land-use in the study area SIGNIFICANT TRENDS IN LAND-USE IN THE STUDY AREA Past Trends Future Trends Name Description Insights on Socio- Description Insights on Socio-economic of the trend costs, profits, economic of the trend – costs, profits, drivers behind – crop type, land value drivers crop type, land value the trend farming behind the farming practice and trend practice and measures measures Arable Following After the Depopulation Intensive Higher profits, The possibilities lands the crisis in crisis, of the area farming higher costs for farmers to use the sector agricultural because of the practices, crop (because of EU funds and during the activities were economic types will climate access foreign transition relatively crisis (Rousse remain the changes, fuel markets; period, profitable, and same; prices and Enlargement of agriculture with surrounding cultivation of increase in min tenants and large has revived relatively low area were the larger areas average salary); landowners – slowly, costs and first places with rapeseed land price shifts buying abandoned characterized cheap land. affected by and corn for upwards. lands or lands by intensive the problems bio-fuel belonging to the cereal of transition). production. aging population. (winter Land Opportunity wheat, corn Investment Trusts and barley) operating in the & industrial area. crops (sunflower and less tobacco) production Forests Regulated Cheap land, Forestry Maintaining Increase in The enlargement forest low profits. Service forests with profits, costs of the Park area; practices, opportunities and prices. Use of forests for especially in for FSC hunting and eco- the Park; certification; tourism. mainly mainly deciduous deciduous forests. forests. Grassla Extensive Low Depopulation Maintaining Increase in land The enlargement nds grazing; profitability, and aging pastures and price; increase of the Park area; some low price of problems in meadows in costs. Natura 2000 sites; meadows land. the area; owned by the Agri- were Problems in municipalities. environmental

20 converted to livestock measure – AE vineyards/ breeding plans of the 3 orchards; because of municipalities many of low milk and have been them were milk products approved abandoned. prices causing (compensations decrease in up to the Measure the number of 1.3 limit – livestock in €10,000). the area. Fish Interest in Low Depopulation Intensive Higher profits, Increase of costs farms fish farming profitability, and ageing; development higher costs. because of the decreased in high costs. abandonment of fish farms. imposition of tax the first of fish farms on water used by years of the in the area. fish farms (ca. transition €.50/m 3 and costs period, related to climate having changes; Tourism positive opportunities. impact on bird species feeding there. Urban/ Rural area; Low price of Depopulation, Balancing of Increase in Development of roads Republican houses. ageing, luck depopulation house prices. eco and rural and National of work process; tourism; roads. opportunities. Increase in the enlargement of the number of Park area. houses offering accommodatio n (rural and eco tourism opportunities). Waste Until High costs Not regulated Attempts for Stricter recently deposit of waste regulations and there were wastes from management higher penalties. many non- the regulated households waste spots and and several agriculture regulated pertaining to each settlement/ municipality Tourism Until the last Low profits, Improper Development Higher profits, EU funds, 2-3 years low costs, low marketing; of rural, eco higher costs, increase in the tourism in price of land. low quality of and historical higher land number of places the area was services. and cultural prices. for cultural and tourism. accommodation; historical competition. tourism; satellite type tourism.

21 4 VALUE OF BIODIVERSITY

Unfortunately, no data is available that can help quantify the socio-economic value of the various ecosystem services provided in the Roussenski Lom area. Tourism and recreation, focused around the area’s rich natural and cultural heritage, is growing, with significant potential for further development. The area provides important services in terms of water and flood management, especially for the downstream regional population centre of Rousse. The rich flowering meadows in the area are important among other things for the strong local tradition of bee keeping.

5 SELECTION OF STUDY SITES

Roussenski Lom case study region is represented by four smaller sites which are used for the needs of the analysis. These smaller sites have been selected on the basis of criteria developed by the project team and mainly for biodiversity-rich areas of dependent on the farming practices – either for their positive relation between farming practices and high nature values or the negative impact caused by the intensification of agricultural activities. Some of the selected sites are already located within the boundaries of the Nature Park, while others are to be included within the enlarged Park. All sites fall within the boundaries of the proposed Natura 2000 site. Basarbovo Site: The site has a total area of 1,447 ha, all of which is to be included in the future territory of the Roussenski Lom Nature Park. The site has a rare and well-preserved habitat of loess steppe grass societies, included in Natura 2000 (Code No. 6250). The area includes pastures located in the south and east of Basarbovo village comprising 285 ha of meadows and pastures, i.e. ca. 20% of the area. The area abuts on agricultural lands comprising 51% of the total area. The pastures are used for grazing, mainly for cows. The current intensity of land use in the area makes it possible to maintain a good biodiversity status. The land is mainly in private hands.

Figure 1. Land use and Natura 2000 maps of Basarbovo

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Shtraklevo Site: The site is home to hamster communities. Although hamsters were once widespread across the Roussenski Lom Nature Park, land abandonment has caused them to concentrate in this site. Fauna is represented by bird species included in the Bird Directive such as the Booted eagle ( Aquila Pennatus ) and Long-legged buzzard ( Buteo rufinus ). The area includes pastures situated near the village of Shtruklevo, Ivanovo municipality. Pastures comprise 42% of the total site area. The area has developed livestock breeding. Farming practices are characterized by intensive grazing leading to depletion of pastures at a higher rate. At the same time intensive farming keeps the hamster communities. Agricultural lands occupy 43% of the territory, with mostly cereals cultivated ( wheat, corn, barley, sunflower). Land is cultivated by large tenants rented by municipality. Ownership is mostly private. Shtraklevo has the highest number of registered farmers among the selected sites. In 2005 there were 19 registered farmers, using 5,434 ha in total; in 2006, the number is more than 60.

Figure 2. Land use and Natura 2000 maps of Shtraklevo

23 Nisovo Site: The area comprises 904 ha in total, of which 275 ha (30%) is agricultural land, 232 ha (26%) pastures and 136 ha (15%) natural meadows – the largest area of natural meadows in Roussenski Lom. The area is home to various plant and animal species such as the Black stork and Egyptian vulture. There is a fish farm which has long served as a feeding site for the Black stork. Farming practices are intensive. Use of pesticides threatens rodents, birds, and pollutes underground water. Another practice is breaking of meadows for cultivating grapes. Poorly managed eco-tourism has disturbed nesting Black storks, leading to a decline in nesting pairs. Land is mainly in private ownership. Some 26% of land has “unknown owner” status. There are 16 farmers, 8 of whom breed animals (mainly sheep, caws, goats). Bee- keeping is also developed – in 2006, there were more than 600 registered bee families.

Figure 3. Land use and Natura 2000 maps of Nisovo

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24 Svalenik Site: This is the largest site among those selected for this study with an area of 1,693 ha. The area, which is located in the river valley of the Mali Lom River in Tzar Kaloyan municipality, has steppe plant species. Extensive livestock breeding is highly developed. There is a high concentration of animal units per ha as well as problems with management of household and agricultural wastes. According to 2005 data, there were 14 registered farmers on the territory of Svalenik, mostly cultivating cereals (wheat, corn, sunflower, barley). There were 5 farmers using more than 100 ha of land (the largest in size uses 1,157 ha). There is a fish farm (2.3 ha). Figure 4. Land use and Natura 2000 maps of Svalenik

6 OPPORTUNITY COSTS OF MAINTAINING BIODIVERSITY

6.1 General remarks Data used to identify the opportunity costs of the farmers was collected from the bulletin published by the Bulgarian Ministry of Agriculture and Forestry (BMAF) and partially from a questionnaire, designed according to the methodology template for this project. The costs and income figures provided by the interviewees were compared to the regional average as provided by the BMAF and municipal management plans. Figures were relatively the same with small deviations, except for the production per hectare for the area, which was significantly different from the national averages. This is normal, as the area is a typical grain producer and national average accounts for small grain and large grain production areas. The farming practices accounted for in the methodology template are the most common for the region. All current practices are intensive – so far, there is no organic producer in the area with regard to the most common land use.

25 6.2 Development scenarios Each case of crop production investigates 5 options for future farming practices: two intensive based on the expected trends; one less intensive related to weed control; a crop rotation option; and a shift from current practices to organic farming. The less intensive option takes into account an increase in the labour used for the manual and mechanical removal of weeds. It is based on Option 2, but in this option the farmer bears the cost of protecting biodiversity influencing his gross margin, reflected in a 20% loss of income. The crop rotation option is based on statistics of the MAF for the crop rotation preferences of farmers which is represented with the ratio 50:30:30 for wheat: corn: sunflower. In the case of meadows, except for the extensive future practice, this case study investigates the option for preventing meadows from being converted to arable lands.

6.2.1. Intensive wheat production The price and costs for the wheat production are based on the Ministry’s statistics and the results from the questionnaire. The assumptions underlying in the Future OC calculations are based on the Bulgarian Ministry of Agriculture (Forecast 2005/2006), FAO ( Crop Prospects and Food Situation preview, No1, February, 2007) and USDA (USDA Agricultural Projections to 2016) forecasts of wheat production and prices. According to the researches and bulletins, future trends in wheat production are characterized with decrease in the quantities produced resulting from the climate changes and the related unfavourable climate conditions, from one side, and the competition of other cereals from the other. Future prices are forecasted to be higher related to higher production costs. Option 1 is a case of intensive wheat production under the following conditions: unchanged quantity produced as compared to the current practice, 12% increase in the price and 8% increase in the costs. Option 2 is an intensive production given that: quantity produced decreases as compared to current practice, price and costs increase by 15% and 8% respectively. Option 3 represents less intensive practice with applying manual and mechanical ways of weed control, requiring more use of manpower. It is based on Option 2, but in this option the farmer has cost to protect biodiversity influencing his gross margin. The cost of measure expresses a 20% decrease in gross profits due to lower harvest. The Organic option is based on Option 2 and shows the opportunity cost to farmer if he moves from intensive to organic farming. This opportunity cost accounts for the cost on certification and additional labour used, as well as for the loss of harvest. The cost of labour accounts for the additional 5 man days resulting from the conversion to organic practices.

6.2.2. Intensive corn production According to the FAO, USDA and Ministry’s forecast the global corn consumption will increase because of a global increase in the demand of corn for production of ethanol (used as biofuel) and the recovery of the poultry-farming; Options are based on the same assumptions as in the case of wheat.

26 Option 2 takes into account an increase in the supply of corn resulting from an increase in demand. Costs and prices of corn in this option change at the same rate (a 10% increase).

6.2.3. Intensive sunflower production Because rapeseed is more cost-effective for processing industries than sunflower, the production of the latter is expected to decrease. Rapeseed is seen as a major competitor of sunflower, because it is also used for biofuel production in Europe (FAO – Crop Prospects and Food Situation preview, No. 1, February, 2007). This change is reflected in option 2.

6.2.4. Meadows and pastures There are no statistics available on meadow and pasture use. Calculations here are based on the knowledge and practice of municipal agricultural specialists. In the case of meadows , two options are presented. The first option represents sustainable use and maintenance of meadows leading to higher labour costs. The cost of labour takes into account the labour necessary to clear meadows of stones, shrub-formations, etc. The case of conversion to arable land gives the minimum payment necessary to stimulate owners of meadows to maintain meadows instead of converting them to arable lands. In this option, the cost of labour accounts for the additional man days necessary to restore broken meadows, and the cost of the measure – for the costs related to the sustainable use of meadows. In both options, the calculation of gross margin takes into account the purchase price of bale packs of hay on the Bulgarian market. The cost of collecting and packing hay is reported under miscellaneous costs. As calculated, the opportunity cost to the owner reveals the minimum level of compensation to a farmer for his change from current to less intensive or organic practices. In the case of pastures, the gross margin includes only the rental price of pastures per ha. The calculation of the opportunity cost to owner accounts for the additional labour required for moving from the current intensive practices to less intensive ones. Another aspect of the opportunity cost here is the land price. As it has been mentioned before, due to active trades with land the price has doubled. According to forecasts of financial intermediaries, who are strong buyers of land at the moment, by 2011 the land price will be within €1,300-€2,000/ha, which is more than 50% above the current average selling price. In our case, the price of land is determined as the average for I and II category of land. The future price of land is determined based on a 10% increase.

27 7 PAYMENT FOR ENVIRONMENTAL SERVICES

The Payment for Environmental Services (PES) scheme considered appropriate for manageable problems in the area comprises several layers. It should be noted that farmers need not be licensed organic farmers to apply for PES.

Level 1 (L1) Mandatory level – this level determines the basis on which a farmer is eligible for PES. It requires that farmers abide by Bulgarian law, including: 1. Applying Good Farming Practices; 2. Respecting and applying the requirements of the Programme for Reduction and Elimination of Contamination in Water-Sensitive Areas; 3. Respecting and applying the Law for Use and Management of Agricultural Lands and the related implementation regulation – forbidding for example burning of stubble-fields.

Aside from the above-stated requirements, L1 includes all prohibitions, recommendations and directions for management of agricultural lands on the territory of the Roussenski Lom Nature Park and the neighbouring lands stipulated in the Management plan of the Park, namely: • The use of fertilizers in agricultural lands; • Burning of stubble-fields and other plant wastes; • Deposit of plant wastes in places different from the regulated ones; • Access to the existing apiaries, except by cart or bicycle – the existing apiaries in the Park are located in: Ivanovo – 3 apiaries, Shtruklevo – 3 apiaries, Pisanetz – 3 apiaries, Svalenik and Nisovo – 6 apiaries; • Use of resources on the rock disclosures because of risk of degradation of habitats of conservation significance; • Cultivation of the plant Asclepias syriaca – melliferous aggressive species, dangerous to the flora of the Park and the surrounding territories; • Use of vehicles, except for the purposes of the specialized security, park administration for protection and management of forests, the fire brigade and emergency (medical aid).

Annual educational and awareness raising campaigns should be undertaken to introduce farmers to sustainable ways of managing stubble-fields and reveal false beliefs leading to such practices (e.g. that burning the fields improves soil quality and destroys pests).

Level 2 (L2) PES : This level takes into account the standards for agricultural activities on the lands in and bordering the Park, stipulated by the Management plan of the Park. It includes incentives for: 1. Sustainable management of meadows • Meadows should be cut once per year, after June, 15 - mowing in May is postponed because this is the breeding period of birds and other species; • Mowing should be implemented from the middle to the end aiming at the protection of bird species;

28 • Measures for restoration of broken meadows should be implemented by reseeding, harrowing and regular mowing consistent with the phase of grass growth;

2. Optimal grazing • Adhering to grazing of a limited number of livestock units (LU) – 1 LU of cattle and 5 LU of small farm animals per hectare; • Limited duration and stimulating grazing in distant areas – this is necessary to protect the hamster population in the area of the Park. • Maintaining of grass-stand in the grazing area to be implemented by sowing, removal of bushes and stones.

3. Arable lands According to the standards for sustainable agricultural practices set in the management plan of Roussenski Lom Nature Park, agri-environmental practices should be applied on arable lands rated first and second category 4 including crop rotations, use of compost, mechanical and biological fight against pests, diseases, etc., the ploughing of land to be done by animal traction. PES cover the cost of certification and loss of harvest related to changing to organic farming, as well as the additional man power related to the application of biodiversity measures. The scheme provisions payments to land users who only apply agri- environmental measures.

4. Single payments for investment activities covering the above-stated actions 5. Awareness raising including: • Awareness raising among farmers for the biodiversity significance of the region; • Educating farmers in the principles and benefits from the crop rotation and training them in proper crop rotation practices. 6. Awareness raising not related directly to land use patterns – disseminating information boards in the accommodation places in the area about the plant and animal species in the Park, the breeding and nesting period and the sustainable tourism practices; preparation of brochures and post-cards with threatened animal/ plant species and sceneries to be sold at the tourist places – 10% of the income goes to the Park Directorate for nature conservation Rationale: This level is based on the land use in the area, as required by the methodology of PES calculation, except for point 6. Awareness raising not related directly to land use patterns . It is considered important to include eco-tourism in PES because tourism practices influence the wildlife.

The following table provides a comparison between proposed PES scheme and the proposed measures under the National Rural Development Plan 2007-2013 on Natura 2000 Agri- environment (NAEP).

4 Agricultural land in Bulgaria is divided into 10 categories according to the quality and fertility of soils and the related agro-meteorological features. Lands of III and IV category dominate in the region of RL.

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Potential other PES schemes in the area include: • Imposition of an entrance fee for the Park. The accumulated amount will be used for training and involving local people in the protection of the Nature Park’s natural resources and cleaning. The entrance fee can be one amount for the whole park or varied according to the visiting zone; • Stimulation of sustainable eco- and rural tourism in the area by introducing tax concessions on the profits of travel agencies from activities in the Park; • Stimulation of donations from local companies through tax concessions – amounts to be used for maintaining the Park; • Stimulation of agri-ecological practices in the area: tax concessions for farmers with approved Agri-Environmental plans for the duration of the project; • Introduction of a scheme for flood protection: compensation the owners/users of riparian agricultural lands (which are mainly meadows and corn fields) for the loss of harvest; compensation for the maintenance of riparian dikes or for the loss of income when necessary to let the flooding of the land in certain months.

Table 6. Comparison of NAEP, Natura 2000 and PES payments

NAEP Natura 2000 - farm lands PES - NP Roussenski Lom Sub-measure HNV 1: Restoration of Maintenance of extensive pasture Sustainable management of pastures abandonment or overgrazing in dry grass habitats and mountain pastures, for which hay compensation is not paid. Maximum permissible pasture Optimal pasture - pasture at rate of 1 intensity - number of animal animal unit of cattle/ha and 5 animal units units/ha. of small animals/ha, additional payment for loss of animal units/ha above the rate determined in the Codes of Good Farm Practice. Restriction on use of mineral fertilizers and No use of pesticides, artificial and Improvement of grass-stay in pastures - pesticides with except those defined in natural fertilizers. sub-sowing, removal of bushes, cleaning of Regulation 2092/91 EEC. stones / measure application is stimulated.

Re-seeding with approved native species* – No use of techniques for change Regulated grazing regime - rotational preferably with seed of local provenance -- and/or enriching of grass grazing, including grazing in the remote specify approved techniques to avoid risk of composition - ploughing up and pastures/ measure application is stimulated ploughing or excessive cultivation. artificial sowing with seeds

Clearance of unwanted vegetation. Maintenance of natural bushing of areas, not lower than 10% for each compensated area.

Sub-measure HNV2: Maintenance of Maintenance of extensive mowing Sustainable meadows management HNV meadows and pastures through in natural meadows, for which mowing or grazing. compensations for pasture are not paid. Use of mineral fertilizers and application of Maximum admissible intensity of Mowing of meadows to be done after 15 pesticides is prohibited except those defined mowing, up to once annually. June and once annually / the loss of missed in Regulation 2092/91 EEC. benefit is compensated. Restriction on manure spreading up to 170 Restriction of follow up pasture up Mowing to be performed from the middle kg/ha. towards the end of meadows, aiming at the conservation of bird species.

30 No new drainage, ploughing or cultivation. No use of techniques for change Restoration measures for ploughed and/or enlargement of grass meadows - sub-sowing, harrow and composition - ploughing up and regulated mowing conformed with the artificial sowing with seeds. phase of grass development. For sub- sowing to be foreseen round about 10 kg/decare grass seeds of grass mix or clover / application of measure based on additional inputs. Free grazing on meadows after the last Removal of undesired bush Restoration measures for root meadow mowing (except for meadows in the forests, vegetation and bracken. vegetation along riparian meadows - because they are a habitat for plant species weeding out of ruderal phytocenosis / of European conservation importance where manual labour by human-hour is the grazing might not be of benefit, compensated. moreover the forest meadows are used for grazing by wild fauna and human presence might disturb them. Establishment and improvement of the Maintenance measures for semi-natural specifics of the habitats, favorable for meadows - fodder gathering from nesting of birds of prey and white storks. secondary and tertiary ruderal co-societies of tare (vetch) / measure application is compensated. Maintenance of minimal and maximal density of livestock –/0,5-1,5 LSU/. To apply definite dates for grazing – those for lowlands and hilly areas shall depend on climatic conditions and those for mountainous – usually between May 30 and September 30 or October 15, depending on altitude and geographical situation. Restriction for grazing on sandy dunes.

Sub-measure HNV 5 : Restoration and Maintenance of flood or wet Scheme for flood protection. Maintenance of Riparian (Riverside) pastures and meadows. Habitats. Leave arable land within 100 m distance Restoration/maintenance of Riparian flood fields/meadows from the river or wetland as uncropped. periodical flooding or permanent (predominantly maize fields) to be wetting of lands. compensated for decreased yields Mowing of wet meadows from the centre to Maximum admissible mowing Riparian dikes - to be compensated their the periphery. intensity up once annually. maintenance, or lands to be left for flooding at appointed months, while the loss of earning is compensated. Restriction on grazing in riparian habitat. Restriction of follow up pasture up Cut reedbeds in the winter or once every 3 No use of pesticides and artificial years or 33% of the reed-bed every year. and natural fertilizers. Restriction on tree harvesting in riparian No use of techniques for changing habitat. and/or enlarging grass composition - ploughing and artificial sowing with seeds. Restriction on drainage and ploughing near Removing of undesirable bush wetlands. vegetation. No corrections to the riverbed Do not store and apply fertilizers, manure and pesticides near riverbeds or wetlands. Afforestation of riverbeds on steep slopes with fortifying bushes and trees. Restoration of natural riparian vegetation.

Measure 1 - Organic Farming Organic Farming / Application of nature friendly practices. To sign a contract with Control body for Perennial crops-rotation - application of conversion and/or on-going management proper crop-rotation / measure application according to accredited national or is encouraged. international organic farming standards.

31 To use and keep the manure produced in the Weed/disease control - application of organic farm in compliance to the Code of mechanical and biological struggle against good farming practices. weeds / manual labour is compensated for human-hour; the higher price of biologically active substances for struggle against weeds/diseases is compensated. To apply the minimum criteria for crop Transition to organic farming - application rotation. of approved program for transition / covered are preliminary payments for production certification - €308. Not to grow organic cereals, leguminous or Organic farming - application of biological vegetables on slopes steeper than 6 о, when production methods / compensated is the there is a high risk of soil erosion. loss of earnings after decrease of yields. Not to plough high nature value meadows and grasslands for growing cereals, perennials or vegetables. As an exception it is possible to change up to 10% of the grasslands into arable land for the 5 year period. Not to destroy boundary strips, single trees or forest cultures. Not to drain or change wetlands and to mow their buffer zones at least once per 3 years. The grazing density of organically-managed livestock on grassland receiving organic support payments must be between 0.5 and 1.5 LSU/ha in order to avoid under/over- grazing of organic pastures.

8 INTERPRETATION OF RESULTS

The proposed PES scheme can be applied in other regions of the country located close to protected areas where livestock breeding is developed. However, it should be noted that livestock breeding in the area is decreasing. Thus, if this PES scheme is to be used in other regions, the level of PES should be adjusted accordingly. The proposed PES schemes are available to all registered farmers in the area without regard to their size. There is no size limitation as very often land is fragmented in small lots – it is an incentive for small landowners to start using their lands or just participate in cooperatives, decreasing the abandoned agricultural land area. It should be noted, however, that a limitation in this scheme exists with regard to the land use, as the PES include the most common land use types in the area – the limitation is on the side of crops cultivated (grains and industrial). Similarly to the Agri-Environmental Measure of the SAPARD pre-accession programme, the PES target a shift from existing practices to organic ones. At the same time, the scheme provides a stimulus to land users who would like to apply agri-environmental practices without undertaking the process of organic certification. During the national expert workshop it was proposed to implement the schemes at local level and thus to encourage more farmers to participate and achieve better land coverage. According to experts at the national workshop, sources of financing should be public for services that are in the public interest. If the interest is private, then PES should be privately financed. Particularly, in the case of Roussenski Lom, such sources of financing could

32 include: entrance fees to the Nature Park; donations; re-distribution of funds from locally collected taxes and fees; tax concessions for travel agencies developing sustainable eco- and rural tourism in the area; and fees collected from the electrical utility.

9 SUMMARY AND RECOMMENDATIONS

This case study examines PES opportunities in the region of Roussenski Lom Nature Park. Since its formal establishment, the park has been home to valuable plant and bird species of global importance and a centre of historical and cultural sites included in the UNESCO list of World Heritage Sites. Currently, the Roussenski Lom Nature Park extends over an area of 3,408 ha and borders on living rural areas (including 3 municipalities). Even though the current territories of the park are mainly woodlands (over 60%), the Park is located in a distinctively agricultural region and the practices applied on the neighbouring agricultural lands influence the wildlife of the park. Valuable plant and bird species, such as the Black stork and Egyptian vulture, are threatened by unsustainable agricultural and to a lesser extent tourism practices, such as: • Slash and burn practices leading to soil depletion; • High use of pesticides and fertilizers; • Unsustainable use of meadows – use of meadows for grazing and breaking them for cultivating crops; • Unsustainable use of pastures – overgrazing in areas near the villages; • Waste management problems; • Uncontrolled tourist visits to the park area and disturbance of birds in the breeding period. The proposed kinds of PES address most of these problems. Direct contact with farmers in the area show that they are open to new, agri-environmental practices if there is financial stimulus and appropriate training. A way to address the problem of slash-and-burn practices that are a problem not only in Roussenski Lom but also Bulgaria more generally is the introduction of a mandatory level requiring observation of the law banning this common practice. This case study proposes PES schemes that would address many of the above problems. It takes into account not only the current but also the future territories of the Roussenski Lom Nature Park. Nevertheless, it does not pretend to be exhaustive – Bulgaria’s recent accession to the EU may change land use practices, land prices as well as tourism activities, and thus the opportunity cost of land. Therefore, further studies should may be needed to trace out the development of the region. It is necessary to evaluate potential PES schemes stimulating sustainable tourism. At the moment, demand for tourist products in the area is not high, but it is increasing. There is a relation between eco-tourism and agricultural practices: intensive agricultural practices, threatening animal species, are negative for the development of eco- and rural tourism. On the other hand, inappropriate tourism practices already are negatively impacting animal and bird species. Benefits from PES schemes related to sustainable tourism include:

33 • Awareness raising of the population regarding biodiversity protection; • Involvement of the population in nature protection leading to lower level of unemployment and keeping economically active population in the area; • Protection of wildlife; • New business opportunities under the supervision of the Park Directorate; • Financial independence of the Park for its maintenance. Further studies in the region can evaluate the result of imposing entrance fees to the Park that can yield the above mentioned benefits. Currently, problems related to agricultural practices appeal to quick reaction – slash and burn practices, destruction of semi-natural habitats, etc. The proposed PES scheme under the supervision of local authorities, the Roussenski Lom Nature Park Directorate and with the support of the Bulgarian Ministry of Agriculture and Forests could prove a successful tool for mitigating and solving these conflicts.

34 10 ACKNOWLEDEGEMNTS, DATA SOURCES, REFERENCES AND DATA ANNEXES

DATA SOURCES AND REFERENCES

Bulgarian Ministry of Agriculture, 2005. Forecast 2005/2006

Directorate of Natural Park Roussenski Lom, Management Plan of Natural Park Roussenski Lom

Decheva R., Bulgarian Ministry of Agriculture, October 2005, Situation and perspective analysis on wheat for the period 2004-2005 and forecast on 2005-2006

Dimitrova P., Bulgarian Ministry of Agriculture, December 2005, Situation and perspective analysis on corn for grain for the market period 2004-2005 and forecast on 2005-2006

Dimitrova P., Decheva R. and Vasileva D., Marketing Department, Bulgarian Ministry of Agriculture, August 2006. Situation and perspective analysis on wheat and barley. Review of the market and evaluation of the 2006 harvest

Dimitrova P., Decheva R. and Vasileva D., Marketing Department, Bulgarian Ministry of Agriculture, June 2006. Wheat, barley, corn for grain and sunflower. State of the crops and forecast on the 2006 harvest.

FAO, 2007. Crop Prospects and Food Situation preview , No1, February, 2007

Ivanovo Municipality, 2000. Characteristics of Ivanovo Municipality – 3 parts

Ivanovo Municipality, 2005. Ivanovo Municipality Plan for Development for the period 2005- 2007

Tzar Kaloyan Municipality, 2006. Plan for Development 2007-2013

USDA, Office of the Chief Economist, World Agricultural Outlook Board, February 2007. USDA Agricultural Projections to 2016

Vasileva D. and Dimitrova P., Marketing Department, Bulgarian Ministry of Agriculture, April 2006. Situation and perspective analysis on corn for grain for the market period 2005- 2006

Vasileva D. and Decheva R. Marketing Department, Bulgarian Ministry of Agriculture, February 2006. Situation and perspective analysis on wheat for the market period 2005-2006

Vetovo Municipality, 2006. Vetovo Municipality Plan for Development for the period 2006- 2015

35 ANNEXES

ANNEX 1 QUESTIONNAIRE

This questionnaire aims at providing information on the farming practices within the current and future boundaries of the Roussenski Lom Natural Park. The filling in will take you less than 10 minutes. Thank you in advance for your time!

1. Have you got lands on the territory of the Park? Yes No

2. What type is your land in terms of use? Fields, perennial plants, forests, vineyard, vegetable garden, orchard, meadow, pasture, other:………………………. (underline the correct one)

3. Where is your land located?

4. What is its area (ha)?

5. Are the above-mentioned territories used? If yes, who uses them? Yes, please specify whether you are owner or leaseholder ………………………………………………………………………………… No

6. What is the area of personal and rented lands? Personal:…………….. ha Rented: …………………ha

7. What type is your farm? Plant-growing Animal breeding Mixed

8. What do you cultivate on your land? What do you use the production from your lands for?

Crop Area Purpose of the production (trade, inner consumption, livestock feeding)

9. What kind of crop rotation do you apply? ……………………………………………………………………………………………… ………………………………………………………………………………………………

36 10. What is your crop production per ha?

Crop Production in Price of a ton Amount of rental tones per payments to you (if land hectares is rented)

11. What means do you use in pest control? Chemicals - pesticides I use other means, different from chemicals (please specify) ………………………………………………………………………………………………… ………………………………………………………………………………………

12. What costs do you sustain per ha production?

Crop Cultivation – Cost on seeds Fertilizers Irrigation Crops Others fuel, (per ha) (ha) (ha) gathering machineries (harvest) (per ha) (ha)

13. What are you costs on work force? Crop Permanent WF Seasonal WF Your own Hired

14. Do you use your land for other purposes different from agricultural? No, I use it for agricultural purposes only Yes, rural tourism, eco tourism, hunting, grazing, herbs collection, wild fruits collection, mushrooms collection, honey production, fishing (underline the correct one)

15. How do you plan to use your lands in future? Agricultural use Sale Renting Increase of its area Building on it Restrain from use Other, ……………………………………………………………

16. What would make you change or keep the way you use your land? ………………………………………………………………………………………………… ………………………………………………………………………………………………… 17. Have you heard of Roussenski Lom Natural Lom? Yes No

37 18. Are familiar of any valuable plant/ animal species dwelling on your land or right next to it? Yes, please specify ……………………………………………………………………. No

19. Do you undertake any measures to protect them? Yes, please specify ……………………………………………………………………. No

20. Would you start to apply biodiversity conservation on your land?? Yes No 21. What would your motives be for that? Financial incentives/losses, more information, influence on production costs, others ………………………………………………………………..

Optional information 22. Your name and surname 23. Your place of residence 23. Your age Thank you for your cooperation!

38 ANNEX 2 – TABLES

Table 1. Ownership of lands in top 4 biodiversity sites (ha) Ownership Svalenik Besarbovo Nisovo Shtraklevo Total State-public 1042,7959 152,9993 77,0653 1272,8605 State-private 25,7721 90,3996 29,5027 22,3069 167,9813 Municipality public 114,9914 42,5538 10,8744 27,6885 196,1081 Municipality private 88,1362 330,3288 75,6825 195,0722 689,2197 Private 300,3418 566,0289 342,3398 708,9535 1917,664 Cooperative 0 Lands of public organiziations 4,404 23,739 63,7803 41,8647 133,788 Lands of foreign physical and legal entities 4,6099 0,0424 1,7162 2,0486 8,4171 International organizations 0 Relogious organizations 9,966 1,3192 11,2852 Joined ownership 111,4748 230,5872 63,9907 0,1366 406,1893 Lands used by the municipality 1,7719 237,3886 323,4225 562,583 Total 1692,5261 1448,4169 903,6597 1321,4935 5366,0962

Table 2. Land use in the top 4 biodiversity sites Land use Svalenik Besarbovo Nisovo Shtraklevo Woodlands 1029,1677 123,1897 107,55 0,8922 Natural Meadows 62,2942 136,58 1,9391 Fields and forests roads 24,5248 34,066 11,343 1,2809 Rocks 31,833 31,4526 36,039 1,6769 Pastures and meadows 90,4665 284,9978 232,44 21,3998 agricultural lands 269,5191 738,6036 275,23 22,6064 waters and hydro-ammeliorative aquipments 38,7573 78,8337 13,044 0,5787 РПМ 8,5352 6,0706 3,065 settelmets and industry 111,4748 137,8143 63,991 perennial plants 25,9535 5,909 24,7 coniferous foresrs 4,7015 Gullies 0,9632 Sands 0,4356 Total 1692,5261 1447,0376 903,98 50,374

Table 3. Registered farmers and activities Shtraklevo Nisovo Svalenik Number of plant-growers 45 8 36 farmers stock-breeders 20 8 15 Crops Wheat 2980 73 918 cultivated Corn 648 145 195 in ha sunflower 1938 574 896 natural meadows (ha) 38 Number of Cattle 84 51 94 animal Sheep 337 126 320 units Goat 232 33

39 Pig 10 Poultry 255 78 bee families 231 316 380

Table 4. Price of land in RL area

Category Price per hectare (in €) of land > 2 ha 1-2 ha > 1ha I 1431,6 1329,4 1176,0 II 1227,1 1124,8 971,5 III 1022,6 920,3 766,9 IV 1022,6 920,3 766,9 V 920,3 818,1 664,7 VI 766,9 664,7 511,3

The price varies +/- €150/ha

Table 5. List of Habitats in the Roussenski Lom area that are of high biodiversity significance according to the EU Habitats Directive.

3150 Natural eutrophic lakes with Magnopotamion or Hydrocharition - type vegetation PAL.CLASS.: 22.13 x (22.41 or 22.421)

40A0 * Subcontinental peri-Pannonic scrub PAL.CLASS.: 31.8B12p

6210 Semi-natural dry grasslands and scrubland facies on calcareous substrates( Festuco-Brometalia ) ( * important orchid sites) PAL.CLASS.: 34.31 to 34.34

6510 Lowland hay meadows ( Alopecurus pratensis , Sanguisorba officinalis ) PAL.CLASS.: 38.2

91E0 * Alluvial forests with Alnus glutinosa and Fraxinus excelsior (Alno-Pandion, Alnion incanae, Salicion albae ) PAL.CLASS.: 44.3, 44.2 and 44.13

91H0 * Pannonian woods with Quercus pubescens PAL.CLASS.: 41.7374

91M0 Pannonian-Balkanic turkey oak- sessile oak forests PAL.CLASS.: 41.769

40