Shared Watercourses Support Project for Buzi, Save and Ruvuma River Basins

Home , Buzi River (Mozambique), Komati River, Lake Mutirikwe, Limpopo River, Pungwe River, Runde River

AFRICAN DEVELOPMENT FUND Language: English Original: English

MULTINATIONAL

SADC SHARED WATERCOURSES SUPPORT PROJECT FOR BUZI, SAVE AND RUVUMA RIVER BASINS

APPRAISAL REPORT

INFRASTRUCTURE DEPARTMENT NORTH, EAST, AND SOUTH REGION SEPTEMBER 2005

TABLE OF CONTENTS

Page BASIC PROJECT DATA/ EQUIVALENTS AND ABBREVIATIONS /LIST OF ANNEXES/TABLES/ BASIC DATA, MATRIX EXECUTIVE SUMMARY i-xiii

1. HISTORY AND ORIGIN OF THE PROJECT 1

2. THE SADC WATER SECTOR 2

2.1 Sector Organisation 2 2.2 Sector Policy and Strategy 3 2.3 Water Resources 4 2.4 Sector Constraints 4 2.5 Donor Interventions 5 2.6 Poverty, Gender HIV AND AIDS, Malaria and Water Resources 6

3. TRANSBOUNDARY WATER RESOURCES MANAGEMENT 7

4. THE PROJECT 10

4.1 Project Concept and Rationale 10 4.2 Project Area and Beneficiaries 11 4.3 Strategic Context 13 4.4 Project Objective 14 4.5 Project Description 14 4.6 Production, Market, and Prices 18 4.7 Environmental Impact 18 4.8 Social Impact 19 4.9 Project Costs 19 4.10 Sources of Finance 20

5. PROJECT IMPLEMENTATION 21

5.1 Executing Agency 21 5.2 Implementation Schedule and Supervision 23 5.3 Procurement Arrangements 23 5.4 Disbursement Arrangement 25 5.5 Monitoring and Evaluation 26 5.6 Financial Reporting and Auditing 27 5.7 Donor Coordination 27

6. PROJECT SUSTAINABILITY 27

6.1 Recurrent Costs 27 6.2 Project Sustainability 28 6.3 Critical Risks and Mitigation Measures 28

7. PROJECT BENEFITS

7.1 Economic Benefits 29 7.2 Social Impacts 29

8. CONCLUSIONS AND RECOMMENDATIONS

8.1 Conclusions 30 8.2 Recommendations 31 ______

This report was prepared following an Appraisal Mission to SADC by Messrs Egbert H.J. Schroten, Principal Sanitary Engineer, D.T. Lekoetje, Senior Public Utilities Economist, Idrissa Samba, Senior Environmentalist and Ms Josephine Ngure, Principal Financial Analyst. Any enquiry relating to this report may be referred to Mr. A. R. Rakotobe, Director, ONIN (Extension 2040) or Mr. N. Matondo- Fundani, Division Manager, ONIN.2 (Extension 2191).

LIST OF ANNEXES

1 Map of Project Area 2 SADC Secretariat Organigram 3 Joint Water Commission or Equivalents 4. RSAP Strategic Objectives 5 List of RSAP Projects 6 Funding status of RSAP 7 Water, Poverty and MDGs Linkages 8(a) Institutional Arrangements (PIA) Mozambique 8(b) Institutional Arrangements (PIA) Zimbabwe 8(c) Institutional Arrangements (PIA) Tanzania 9 Shared Watercourses and Interdependencies in SADC 10 List of on going Bank Group Financed Projects for SADC 11 Community Based Projects Selection Criteria 12 Environmental and Social Management Plan Summary 13 Detailed Cost Tables (A, B) 14 Project Implementation Arrangement 15 Chronology of Preparation and Appraisal Activities

List of Tables

Page Table 1 Population, Annual Renewable Freshwater Resources, Water Scarcity Index 4 Table 2 Project River Basins Characteristics 13 Table 4.1 Summary of Project Cost Estimates by Component 20 Table 4.2 Summary of Project Cost Estimates by Category of Expenditure 20 Table 4.3 Sources of Finance 21 Table 4.4 Expenditure Schedule by Component 21 Table 4.5 Expenditure Schedule by Source of Finance 21 Table 5.1 Procurement Arrangements 25

iii

AFRICAN DEVELOPMENT FUND Temporary Relocation Agency BP 323, 1002 TUNIS Belvedere, TUNISIA Tel: (216) 71 10 22 66 Fax: (216)-71-33 36 80 Website: www.afdb.org PROJECT INFORMATION DATE: September 2005

The information given hereunder is intended to provide some guidance to prospective suppliers, contractors, consultants and all persons interested in the procurement of goods and services for projects approved by the Boards of Directors of the Bank Group. More detailed information and guidance should be obtained form the Executing Agencies of the Borrowers.

1. COUNTRIES : Mozambique, Tanzania and Zimbabwe

2. NAME OF THE PROJECT : Multinational: SADC Shared Watercourses Support Project for Ruvuma, Buzi and Save River Basins

3. LOCATION : Buzi & Save (Mozambique & Zimbabwe) Ruvuma (Mozambique & Tanzania)

4. RECIPIENTS OF THE GRANT : SADC

5. EXECUTING AGENCY : SADC Secretariat, Private Bag 0095, Gaborone, Botswana Tel: 267-395 1863 Fax: 267-397 2848

6. PROJECT DESCRIPTION : The project includes the following Components: A. River Basin Monograph and Strategy Development B. Enhanced Knowledge and Information Support system, C. Community Basin Management, D. Project management and Capacity Building, and E. Audit services.

7. TOTAL PROJECT COST : UA 10.43 Million Foreign Cost : UA 7.84 Million Local Cost : UA 2.59 Million

8. ADF GRANT : UA 9.38 Million

9. OTHER SOURCES OF FINANCING : Governments/RBMIs : UA 1.05 Million

10. DATE OF APPROVAL : December 2005

11. ESTIMATED START DATE OF IMPLEMENTATION OF PROJECT AND DURATION : January 2006/48 months

12. PROCUREMENT : Procurement of goods, works and services financed by ADF will be in accordance with the Rules of Procedure for the procurement of goods and works or, where applicable, the Rules of Procedure of the Bank for the use of consultants based on the Bank’s standard bidding documents.

13. CONSULTANCY SERVICES : Required for the Project Coordination Office, Technical Assistants, River Basin Monographs and Strategy Development as well as for Audit.

14. ENVIRONMENTAL CATEGORISATION: The Project has been categorised a category II

CURRENCY EQUIVALENTS AND MEASURES Currency Equivalents (September 2005)

1 UA = US$ 1.45984 1 UA = TZS 1648.83 1 UA = ZWD 14557.6 1 UA = MZM 35786.7

MEASURES

mm = millimetres mm/yr = millimetres per year m3 = cubic metres Mm3 = million cubic metres Ha = Hectares

FISCAL YEAR April 1 – March 31 (SADC)

ABBREVIATIONS ADB = African Development Bank ADF = African Development Fund ALCOM = Aquaculture for Local Communities development programme ARAs = Regional Water Administrations AWRMI = Africa Water Resources Management Initiative AWMFS = Agricultural Water Management for Food Security CAADP = Comprehensive Africa Agricultural Development Plan DNA = National Directorate of Water DSS = Decision Support System EA = Executing Agency EKIS = Early Knowledge Information System EU = European Union FY = Financial Year Ha = Hectare HYCOS = Hydrological Cycle Observing Systems ICB = International Competitive Bidding ICWE = the International Conference on Water and the Environment IWRMD = Integrated Water Resources Management and Development JSC = Joint Steering Committee JWC = Joint Water Committee/Commission LHDA = Lesotho Highlands Development Authority LHWP = Lesotho Highlands Water Project LIMCOM = Limpopo Watercourse Commission MDGs = Millennium Development Goals MIS = Management Information System MOU = Memoranda of Understanding MTR = Mid Term Review MZM = Mozambique metical NFP = National Focal Person

NEPAD = New Partnership for Africa’s Development O&M = Operations and Maintenance OKSC = Okavango Steering Committee OKACOM = Okavango Water Commission ORASECOM = Orange Senqu Watercourse Commission PCO = Project Coordinating Office PCR = Project Completion Report PIA = Project Implementation Agency PLA = Participatory Learning and Action QPR = Quarterly Progress Report RBIM = River Basin Information Management System RBMIs = River Basin Management Institutions RBOs = River Basin Organisations RISDP = Regional Indicative Strategic Development Plan RSAP = Regional Strategic Action Plan Ruvuma = The Ruvuma/Rovuma Basin SA = Special Account SACU = Southern African Custom Union SADC = Southern African Development Community SDC = Swiss Development Cooperation TZS = Tanzanian Shillings UA = Unit of Account UNCED = United Nations Conference on Environment and Development UNDP = United Nations Development Program UNEP = United Nations Environment Program US$ = United States Dollar WSCU = Water Sector Coordinating Unit WSRG = Water Strategic Reference Group ZACPLAN = Zambezi River Action Plan ZAMCOM = Zambezi Watercourse Commission ZINWA = Zimbabwe National Water Authority ZRA = Zambezi River Authority ZWD = Zimbabwe Dollar

vii

SADC COMPARATIVE SOCIO ECONOMIC INDICATORS Developing Developed Year SADC Africa Countries Countries Basic Indicators Area ( '000 Km²) 9 864 30 061 80 976 54 658 Total Population (millions) 2003 205 849.5 5,024.6 1,200.3 Urban Population (% of Total) 2003 42.4 39.2 43.1 78.0 Population Density (per Km²) 2003 20.7 28.3 60.6 22.9 GNI per Capita (US $) 2003 953 704 1 154 26 214 Labor Force Participation - Total (%) 2003 50.6 43.3 45.6 54.6 Labor Force Participation - Female (%) 2003 49.7 41.0 39.7 44.9 Gender -Related Development Index Value 2002 0.417 0.476 0.655 0.905 Human Develop. Index (Rank among 174 countries) 2002 n.a. n.a. n.a. n.a. Popul. Living Below $ 1 a Day (% of Population) 1998 30.1 46.7 32.0 20.0 Demographic Indicators Population Growth Rate - Total (%) 2003 1.1 2.2 1.7 0.6 Population Growth Rate - Urban (%) 2003 3.5 3.8 2.9 0.5 Population < 15 years (%) 2003 48.8 42.0 32.4 18.0 Population >= 65 years (%) 2003 3.5 3.3 5.1 14.3 Dependency Ratio (%) 2003 96.6 86.1 61.1 48.3 Sex Ratio (per 100 female) 2003 108.3 99.0 103.3 94.7 Female Population 15-49 years (% of total population) 2003 26.7 24.0 26.9 25.4 Life Expectancy at Birth - Total (years) 2003 47.4 50.7 62.0 78.0 Life Expectancy at Birth - Female (years) 2003 48.6 51.7 66.3 79.3 Crude Birth Rate (per 1,000) 2003 43.4 37.0 24.0 12.0 Crude Death Rate (per 1,000) 2003 22.9 15.2 8.4 10.3 Infant Mortality Rate (per 1,000) 2003 105.0 80.6 60.9 7.5 Child Mortality Rate (per 1,000) 2003 181.6 133.3 79.8 10.2 Maternal Mortality Rate (per 100,000) 2000 1,055 661 440 13 Total Fertility Rate (per woman) 2003 5.7 4.9 2.8 1.7 Women Using Contraception (%) 1987 28.1 40.0 59.0 74.0 Health & Nutrition Indicators Physicians (per 100,000 people) 1993 32.3 57.6 78.0 287.0 Nurses (per 100,000 people) 1991 37.5 105.8 98.0 782.0 Births attended by Trained Health Personnel (%) 2000 64.9 44.0 56.0 99.0 Access to Safe Water (% of Population) 2002 76.3 64.4 78.0 100.0 Access to Health Services (% of Population) 1991 57.4 61.7 80.0 100.0 Access to Sanitation (% of Population) 2002 70.3 42.6 52.0 100.0 Percent. of Adults (aged 15-49) Living with HIV/AIDS 2003 13.4 6.4 1.3 0.3 Incidence of Tuberculosis (per 100,000) 1999 224.5 109.7 144.0 11.0 Child Immunization Against Tuberculosis (%) 2003 94.6 81.0 82.0 93.0 Child Immunization Against Measles (%) 2003 82.7 71.7 73.0 90.0 Underweight Children (% of children under 5 years) 2000 25.8 25.9 31.0 … Daily Calorie Supply per Capita 2002 2 366 2 444 2 675 3 285 Public Expenditure on Health (as % of GDP) 2001 3.3 3.3 1.8 6.3 Education Indicators Gross Enrolment Ratio (%) Primary School - Total 2001 103.6 88.7 91.0 102.3 Primary School - Female 2001 99.6 80.3 105.0 102.0 Secondary School - Total 2001 46.5 42.9 88.0 99.5 Secondary School - Female 2001 38.1 41.3 45.8 100.8 Primary School Female Teaching Staff (% of Total) 1998 58.1 46.3 51.0 82.0 Adult Illiteracy Rate - Total (%) 2003 27.8 36.9 26.6 1.2 Adult Illiteracy Rate - Male (%) 2002 21.0 28.4 19.0 0.8 Adult Illiteracy Rate - Female (%) 2003 35.1 45.2 34.2 1.6 Percentage of GDP Spent on Education 1998 5.9 5.7 3.9 5.9 Environmental Indicators Land Use (Arable Land as % of Total Land Area) 2003 4.8 6.2 9.9 11.6 Annual Rate of Deforestation (%) 1995 0.7 0.7 0.4 -0.2 Annual Rate of Reforestation (%) 1990 4.0 10.9 … … Per Capita CO2 Emissions (metric tons) 1998 2.0 1.2 1.9 12.3 Source: Compiled by the Statistics Division from ADB databases; UNAIDS; World Bank Live Database and United Nations Population Division. Notes: n.a. Not Applicable; … Data Not Available.

viii

Multinational Project Matrix PERFORMANCE INDICATIVE TARGETS ASSUMPTIONS/ HIERARCHY OF OBJECTIVES EXPECTED RESULTS REACH INDICATORS TIME FRAME RISKS

Sector GOAL The development of integrated water SADC Shared Watercourses Protocol SADC Region Joint management of the river A framework for sustained, Political dialogue and resources management and related operationalized basins by riparian countries effective and efficient planning cooperation between physical infrastructure development using similar management and management of shared riparian countries is that contributes to regional tools and institutional structure river basins at regional and continued and integration and poverty reduction. set up related national levels by 2010. strengthened

Source

SADC Reports Progress Reports Project Completion Report Project Objective:

Multinational Project Matrix PERFORMANCE INDICATIVE TARGETS ASSUMPTIONS/ HIERARCHY OF OBJECTIVES EXPECTED RESULTS REACH INDICATORS TIME FRAME RISKS

To ensure a sustainable framework 1. An efficient framework for the joint 1. RBMIs management Continued commitment of for an integrated planning and management of the three river basins Five RBMIs in the structure established, 1. Three river basin strategies the Governments to management of shared water at regional, national and catchment three SADC formulation and evaluation of in place by 2009 implement project resources in the Buzi, Save and level established in the three riparian countries IWRM policies in three river Ruvuma river basins for countries. basin put in place by 2007 Riparian countries willing development and support of to reach consensus and improved livelihoods of the local 2. Harmonized and improved national 2. Water databanks and share information communities. water policies and strategies based on planning networks are Government staff and sound integrated water resources established and fully stakeholders familiar with management (IWRM) and regionally operational by 2009. IWRM developed guidelines. 2. Three EKIS established and O&M schedules properly linked to SADC system by coordinated. 3. Enhanced capacity from a river 3. Regional and Joint IWRM 2009 basin wide perspective to support the scenarios and strategies Equipment is efficiently development, management, and developed by 2009 procured and installed; protection of Basin water resources in Sufficient recurrent budget an equitable, optimal, integrated, and 3. Ranked list of future is provided for data sustainable manner. 4. EIAs on identified future investments produced by collection; data is made investments , future 2010. available to all agencies investments budgeted, ranked, 4. River basin strategies prioritised and selected

5. Community Basin Management sub- Sources 4. Increased awareness, broad projects implemented participation and gender Quarterly Progress Reports mainstreamed in water resources development and Audits reports produced management by 2010. annually

Bank Supervision reports

Monograph Reports

Established EKIS and RBIM

Activities:

Multinational Project Matrix PERFORMANCE INDICATIVE TARGETS ASSUMPTIONS/ HIERARCHY OF OBJECTIVES EXPECTED RESULTS REACH INDICATORS TIME FRAME RISKS

UA 1. Three River Basin 1. Three river basin A. Monographs and Strategy 1. River Basin Monographs 1. River Basins/ Monographs produced monographs by 2007 3.32 SADC Countries. Donor and counterpart funding available B. EKIS 1.05 Institutions established and C. CBM 2.26 2. Well equipped and staffed PIAs staffed and PCU 2. Office equipment procured D. PM/CB 2.17 2.RBMI offices and staff identified 2. Computing and office Capacity Building activities E. Audit 0.13 and SADC PCU a. IEC Campaigns equipment procured and implemented at all levels installed in PIAs/PCU 3. Information, Education and Laws and policies Base Cost 8.93 Communication (IEC) Stakeholder awareness prioritized by concerned

Campaigns held governments Phys. Cont. 0.89

Price Cont. 0.60 3. River basin Water resources data

Communities made available by riparian Total 10.43 Source Three river basin IEC countries

Quarterly Progress Reports campaigns by 2007

Resources: Audits reports produced ADF 9.38 annually

Counterpart 1.05 Bank Supervision reports

Total 10.43 Monograph Reports

Established EKIS and RBIM

EXECUTIVE SUMMARY

1. PROJECT BACKGROUND

An African Development Fund (ADF) mission in consultation with SADC Water Division in 2003 identified the SADC Shared Watercourses Support Project for Buzi, Ruvuma and Save River Basins to support the implementation of the Revised Protocol on Shared Watercourses. The proposed Shared Watercourses Support Project covers the three river basins of Buzi, Ruvuma and Save and will address three areas identified in SADC’s Regional Strategic Action Plan for Integrated Water Resources Management and Development (RSAP- IWRMD) namely: (a) surface water assessment/management, (b) groundwater assessment/management and (c) capacity building. The RSAP-IWRMD is an integral part of the Revised Protocol on Shared Watercourses that is geared towards creating an enabling environment for joint management of regional water resources in the SADC region. RSAP features in the SADC Regional Indicative Strategic Development Plan (RISDP), the blue print for regional integration and cooperation.

2. PURPOSE OF THE GRANT

The ADF Grant of 9.38 UA Million will be provided to the SADC for the purpose of implementing the project. The ADF grant cover 90% of the total project cost.

3. PROJECT GOAL AND OBJECTIVE

The Project Goal is to ensure the development of integrated water resources management and related physical infrastructure development that contributes to regional integration and poverty reduction.

The Project Objective is to ensure a sustainable framework for an integrated planning and management of shared water resources in the Buzi, Ruvuma and Save river basins for development and support of improved livelihoods of the local communities.

4. PROJECT DESCRIPTION

The project will consist of five components, namely (A) Development of River Basin Monographs and Strategies, (B) Enhanced Knowledge and Information Support System (C) Community Basin Management, (D) Project Management and Capacity Building (E) Audit Services.

5. PROJECT COSTS

The total cost of the project, net of taxes and customs duties, is estimated at UA 10.43 million, of which 75% is foreign cost and 25% is local cost. ADF will finance the entire foreign exchange cost (UA 7.84 Million) and part of local cost (UA 1.54 Million). The three SADC member states, through the SADC secretariat, will contribute the balance of local costs amounting to UA 1.05 million.

xii

6. PROJECT IMPLEMENTATION

The Executing Agency is SADC Secretariat through its Water Division, Infrastructure and Services Directorate. The River Basin Management Institutions (RBMIs) will be the Project Implementing Agencies (PIAs). The offices of ZINWA-Save and ZINWA-Runde, in Zimbabwe, and ARA Centro in Mozambique will handle project activities on the Save and Buzi Basins. The Ruvuma Basin office in Tanzania and the ARA Norte office in Mozambique will handle project activities on the Ruvuma Basin. The project will be implemented over a period of 48 months starting in 2006.

7. CONCLUSIONS

The Shared Watercourses Support Project complies with the SADC priorities as expounded in the RISDP and RSAP-IWRMD and in the short, medium and long term business and the strategic action plans for the region.

In view of the foregoing, it is recommended that a grant not exceeding UA 9.38 million be extended to the SADC Secretariat, subject to the following conditions:

Grant Conditions:

A. Conditions Precedent to Entry into Force

The Protocol of Agreement shall enter into force upon its signature by the Recipient and the Fund; B. Conditions Precedent to First Disbursement of the Grant

The obligations of the Fund to make the first disbursement shall be conditional upon the fulfilment by the Recipient of the following conditions:

The Recipient shall have, to the satisfaction of the Fund:

(i) Provided evidence that the Northern Region Water Administration (ARA Norte) Office is established and provided with offices and key staff (para 5.1.4);

(ii) Provided evidence that a Project Steering Committee, consisting of (a) two representatives of the SADC Secretariat (one from the Water division and the other from the Gender unit), (b) the two Directors of Water Affairs from Mozambique and Zimbabwe, (c) one representative of each the three Project Implementation Agencies and (d) a representative of the water users from each country, has been established (para 5.1.6);

(iii) Provided evidence that a Project Steering Committee consisting of (a) two representatives of the SADC Secretariat (one from the Water division and the other from the Gender unit), (b) the two Directors of Water Affairs from Mozambique and Tanzania, (c) one representative of each the Project Implementation Agencies and (d) a representative of the water users from each country, has been established (para 5.1.6);

xiii

(iv) Provided evidence that the Joint Water Commission between Mozambique and Tanzania, consisting of representatives of the two countries designated by the Ministers responsible for water, has been established (para 5.1.7);

(v) Provided evidence that the SADC Secretariat has opened, in a bank acceptable to the Fund, a foreign currency Special Account into which the proceeds of the grant shall be deposited (para 5.4.3);

(vi) Provided evidence that each Project Implementation Agency (PIA) has opened, in banks acceptable to the Fund, Special Accounts in foreign and local currency for project implementation (para 5.4.3);

(vii) The Bank in which the Special Account are lodged should have provided an irrevocable undertaking which is acceptable to the Fund that:

(a) funds held in the Special Accounts cannot be used , set-off or blocked for any purpose other than that of the grant; (b) prompt monthly statements of accounts will be issued to the Fund and the Recipient; and (c) authorized Fund staff and appointed auditors will have access to the Special Accounts and related documents.

xiv

1. HISTORY AND ORIGIN OF THE PROJECT

1.1 In recognition of the importance of a coordinated approach to the utilisation and preservation of water resources, the SADC member States signed the Protocol on Shared Watercourse Systems at the 1995 Summit in South Africa. This Protocol was revised in 2000 and came into force in 2003. The main thrust of the Protocol is the creation of an enabling environment for joint management of regional water resources in the SADC region so as to ensure equitable sharing and efficient conservation of water. It is one of the Protocols developed and adopted pursuant to the SADC treaty. To date SADC has signed a total of 23 Protocols and Declarations with the aim of harmonising policies and legislation in a number of areas, including natural resources. Protocol implementation is regarded as the most prominent tool to achieve a deeper regional integration.

1.2 One of the biggest challenges faced by SADC member States in the implementation of the Shared Watercourses Protocol is the lack of a sustainable framework to guide the integrated planning and management of shared water resources. Among others, this includes a lack of appropriate institutional set-up, lack of reliable information on water resources and water use, weak River Basin Organisations, and limited stakeholders’ involvement in planning and management at the Basin level.

1.3 An African Development Fund (ADF) Project identification mission was launched in 2003 to assess ways in which the Bank could assist SADC in addressing some of these challenges. The mission was undertaken in close consultation with the SADC Water Division and the result was the SADC Shared Watercourses Support Project. The critical areas identified by the SADC for Bank intervention included the need for the establishment of river basin organisations (RBOs), assessment of groundwater and its management, and assessment of surface water with a view to promoting regional cooperation.

1.4 The proposed Project would thus address the three major areas identified in SADC’s Regional Strategic Action Plan for Integrated Water Resources Development Management (RSAP-IWRMD), namely: (a) surface water assessment/management, (b) groundwater assessment/management and (c) capacity building. The three areas would be addressed within the framework of the river basin in line with the tenets of the Protocol.

1.5 The proposed project is part of the broader SADC Regional Indicative Strategic Development Plan (RISDP). It is also part of NEPAD’s Short-Term Action Plan on trans- boundary water resources management. Further, its implementation would contribute towards the African Union programme of Comprehensive Africa Agricultural Development Plan (CAADP) adopted in Maputo in 2003. The proposed project is in line with the approved Bank’s Regional Assistance Strategy Paper for Southern Africa (2004-2008) and the Bank’s desire, contained therein, to channel its regional assistance efforts mainly through SADC.

1.6 Geographically the Project covers the three river basins of Buzi and Save (Mozambique/Zimbabwe) and Ruvuma (Tanzania/Mozambique). The selection of these three river basins out of the 15 SADC basins was based on the following criteria: (i) River basins identified in the RSAP that had not yet received donor support, (ii) River basins consisting of ADF countries and a blend country, (iii) Basins with the highest population per country and facing high poverty levels, and (iv) Basins with the potential for reducing downstream flooding, especially in Mozambique.

1.7 The project preparation activities commenced in 2004 with Swedish bilateral funds during which a consultant engaged undertook consultations and discussions with representatives of the Ministries responsible for Water in Mozambique, Tanzania and Zimbabwe. This was followed by the bank preparation mission in February 2005 and an appraisal mission in August 2005. This report is based on the discussions and consultations held and information/documentation obtained during the two missions, as well as other information available within the Bank and from the consultant reports.

2. THE SADC WATER SECTOR

2.1 SECTOR ORGANISATION

2.1.1 The Southern African Development Community (SADC), made up of Angola, Botswana, the Democratic Republic of Congo, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Tanzania, Zambia, and Zimbabwe came into effect by the signing of a Treaty in August 1992. The main thrust of SADC is to achieve meaningful development and economic growth, alleviate poverty, enhance the standard and quality of life of the people of Southern Africa and support the socially disadvantaged regions through regional integration.

2.1.2 Originally, the SADC model of regional integration and co-operation supported the creation of strong centralized supranational institutions to guide the process of integration, with a model that favored a decentralized sector-based approach in which countries were delegated the tasks of co-coordinating regional developments in particular sectors. Under this arrangement activities in the water sector were handled by the Water Sector Coordinating Unit in Maseru, Lesotho.

2.1.3 The performance of the sector-coordination units in member states proved to be highly uneven and at an Extraordinary Summit of the Heads of State and Government held in Windhoek in March 2001, a decision was taken to restructure the SADC institutions to make them more effective in delivering the regional program.

2.1.4 The 21 sector-coordinating units and commissions located in member states were abolished and replaced with four directorates based at the SADC Secretariat in Gaborone, Botswana. These directorates are; (1) Trade, Industry, Finance and Investment; (2) Infrastructure and Services; (3) Food, Agriculture and Natural Resources; and (4) Social and Human Development and Special Programmes. Each of the directorates is headed by a Director. The organisation of the Secretariat is shown in Annex.2.

2.1.5 The SADC Water Division falls under the Directorate of Infrastructure and Services and is tasked with overall coordination and management of the SADC Water Programme The Division’s main focus is the establishment of river basin organizations (RBOs) across the 15 SADC river basins in the context of implementation of the SADC Protocol on Shared Watercourses.

2.1.6 To date sixteen agreements related to trans-boundary watercourses in the SADC region have been entered into. Several bilateral and multilateral water course commissions, specialized river commissions, technical committees and development authorities responsible for the integrated management of trans-boundary rivers have also been established by SADC

governments. The Zambezi Watercourse Commission (ZAMCOM) was established in July 2004 and covers the eight member states riparian to the Zambezi River Basin. The Orange- Senqu Commission (ORASECOM) was established in 2000 for the management of Orange river and covers Botswana, Lesotho, Namibia, and South Africa. The Okavango River Basin Water Commission (OKACOM) established in 1994 manages the Okavango river basin covering Angola, Botswana and Namibia. The Limpopo Watercourse Commission (LIMCOM) was established in 2003 to coordinate activities on the Limpopo Basin. There are also other bilateral organization such as Zambezi River Authority (ZRA) and Lesotho Highlands Development Authority (LHDA). The list of Joint Water Commissions is shown in Annex 3.

2.2 SECTOR POLICY AND STRATEGY

2.2.1 The policy functions previously handled by the 21 sector-coordinating units and commissions is now the responsibility of the four Directorates within the SADC Secretariat. At the national level, SADC National Committees, composed of key stakeholders in government, private sector and civil society provide inputs in the formulation of regional policies and strategies and co-ordinate the activities of respective individual Member States.

2.2.2 The vision of the SADC Water Sector is to ensure the sustainable, integrated planning, development, utilization and management of water resources that contribute to the attainment of SADC’s overall development goals of poverty alleviation, food security and industrial development within the framework of and integrated regional economy. The three pillars supporting this integrated approach are the Protocol on Shared Watercourses and the Regional Strategic Action Plan for Integrated Water Resources Management Development (RSAP-IWRMD, and the recently approved Regional Water Policy (August 2005),).

2.2.3 The Revised Protocol on Shared Watercourses (2000) provides the framework to develop sustainable integrated water resources management approach. The RSAP-IWRMD was formulated in 1997-1998 and approved by the SADC Summit in 1998. It was conceived as a support programme for the water sector policy for regional integration amongst SADC members, and was initiated by adoption of the “Protocol on Shared Watercourse Systems” in 1995. It is meant to lay the institutional basis for the execution of infrastructure projects and development initiatives and a prototype for sustainable regional co-operation under SADC.

2.2.4 The Regional Indicative Strategic Development Plan (RISDP), adopted in 2003, constitutes a strategic framework for deeper regional economic integration and social development in the SADC region. RISDP provides strategic direction for the efficient implementation and delivery of the SADC Programme of Action over a period of 15 years. It aligns the overarching long-term integrated development goals and objectives with discrete policies and priority intervention areas, while enhancing and strengthening inter-sectoral linkages and synergies in order to accelerate poverty eradication in the region. It is a cross- sectoral plan in which significant emphasis has been placed on water through the updated RSAP-IWRMD. In it the cross-sectoral nature of water in the development process has been underscored: poverty reduction, food security, provision of energy, securing good health, etc. The objectives of RSAP-IWRMD are shown in Annex 4 while the current list of projects under RSAP is as indicated in Annex 5.

2.3 WATER RESOURCES

2.3.1 The SADC region has a total land area of nearly 6.8 million square kilometres at an average altitude of 1,000 meters above sea level, and has 15 main river basins. Of the region’s total land area 3% is humid, receiving more than 1,500 mm of rain per year; 40% is moist sub-humid, receiving between 1,200-1,500 mm/yr; 19% is dry sub-humid, receiving 600-1,200 mm/yr; 16% is semi-arid, receiving 400-600 mm/yr; 15% is arid, receiving 100- 400 mm/yr; and 7% is desert, receiving less than 100 mm/yr.

2.3.2 In general the rainfall increases northward towards the Equator, with the more northerly river basins having a much higher runoff per unit area than those in the south. Many rivers in the drier zones of the region are seasonal, only flowing when sufficient rainfall occurs and ceasing to flow for part of the year. Some may flow only after abnormally heavy rain, once in several years.

2.3.3 The highest level of renewable water resources per capita in SADC is 29,545 m3 in Namibia, while the lowest is 1,206 m3 in South Africa. The water use statistics, which also indicate availability of developed water resources for human use, show that an average of 152 m3 of water are used per capita per year in SADC, with the highest of 410 m3 in both Mauritius and South Africa, and lowest per capita of 20 m3 in Malawi. The region is generally water poor despite having access to 15 major river systems, including Zambezi, Orange and Okavango rivers among others although within the region, major disparities exist. Table 1 shows that only 2 SADC countries were water stressed in 2000, by 2025, 6 will experience water stress and water scarcity.

Table 1: Population, Annual Renewable Freshwater Resources, Water Scarcity Index Country Population Annual Population Water scarcity Water scarcity Water scarcity index (million) renewable water pressure on index index 2025 2025 resources water availability 1995 2000 (Km3/yr) 2025

Angola 25.94 184.0 141 1 1 2 Botswana 2.27 14.7 154 1 2 2 DRC 102.83 1,019.0 101 1 1 2 Lesotho 3.40 5.2 654 2 2 3 Malawi 18.70 18.7 1000 2 2 4 Mauritius 1.41 2.2 641 2 2 3 Mozambique 26.73 216.0 124 1 1 2 Namibia 2.46 45.5 54 1 1 1 South Africa 50.16 50.0 1003 3 3 4 Swaziland 1.80 4.5 400 2 2 2 Tanzania 56.09 89.0 630 2 2 3 Zambia 18.29 116.0 154 1 1 2 Zimbabwe 17.40 20.0 870 2 3 3 *Remark: Water Scarcity Index (Falkenmark, 1993) is population pressure on water availability expressed in people/annual renewable water resources/year (people/Mm3/year) 1 = adequate (<100); 2 = quality and dry season problems (100-600); 3 = water stress (600-1000); 4 = absolute scarcity (1000-2000); 5 = water barrier (>2000). The figures exclude Madagascar because it became a member in August 2005.

2.3.4 The SADC region has in general a low water runoff despite having access to major river systems, including Zambezi, Orange and Okavango rivers among others. Within the region, major disparities exist. For example, the total runoff in South Africa is only half of that of the Zambezi River. The countries in the South and West of the region are most vulnerable to water shortages, e.g. South Africa, Namibia, Lesotho, Swaziland, Botswana and Zimbabwe.

2.4 SECTOR CONSTRAINTS

2.4.1 The region faces a number of constraints in the management of its water resources. First, most of the major river basins in the region are shared between two or more countries. 4

Unless these are jointly managed, the shared watercourses can lead to uncertainties and tensions regarding water allocations; and due to lack of coordinated water resources planning, development and management, as well as monitoring and data insufficiencies. The region’s institutional and human resource capacity required to deal with water resources utilisation and management inequalities is currently weak and requires continued strengthening through capacity building.

2.4.2 Second, for a sustainable development of water resources, it is imperative to make a quantitative estimation of the available water resources based on solid information and data. Water resources in the region are subject to extreme variability; droughts are endemic to the region, floods are relatively frequent occurrences, and many rivers do not have year-round flow. The lack of adequate national and regional databases to support water resources management decisions in the shared watercourses is thus a major constraint. There is need to establish a systematic operational hydro-meteorological network, consolidate and effectively store existing basin water resources information and facilitate data accessibility and analysis.

2.4.3 Third, the division of management responsibilities for one trans-boundary river basin between different administrative authorities results in fragmented approaches to water resources planning and management. The establishment of bilateral and multilateral water commissions is aimed at addressing this but more needs to be done in this respect. SADC also currently lacks full harmonization of trans-boundary river basin strategies and operational rules and regulations related to water resources management. These need to be harmonised.

2.4.4 Overall demands for water are growing and the impacts of such demand on the water resources are posing strain and hamstrung the efforts, both in terms of water demand and pollution potential implications. The lack of appreciation of equitable water resources utilization is a constraint in itself, partly emanating from the inadequate stakeholders’ participation in river basin development planning acts as a further constraint. A key issue in this respect the lack of awareness of the cross-sectoral nature of water problems and the need for a new development paradigm towards integrating the technical, economic, environmental, social and legal aspects of water management. Users need to be sensitised of these issues through activities such as stakeholder workshops, pilot programs on integrated water resources management, etc.

2.4.5 In rural areas, the region faces challenges of providing necessary water infrastructure to reach outlying areas, in a cost-effective manner and within reach of the rural poor. The constraints lie in being able to take into account the ability to pay as well as the capacity to maintain and operate water infrastructure. In urban areas, it faces challenges in keeping up with the pace of rapid informal urbanization and demands for larger volumes of water. The need to build on the existing infrastructure such as storage reservoirs, drainage systems, sewers and treatment works has not faced with the need to meet these demands.

2.5 DONOR INTERVENTION

2.5.1 Several donors are active in the water sector in general and in the larger river basins of SADC. The ADF has pledged support for a number of activities as presented in Annex 6. Other donors include bilateral agencies like DANIDA, GTZ, KFW, SIDA, SDC, USAID, and the Netherlands and multinational agencies like the World Bank, ADF, European Union, WHO, and UNICEF. The forum for donor coordination in the water sector is through the 5

SADC Water Strategy Reference Group (WSRG), a bi-annual meeting of donors active in the water sector. WSRG provides a forum for mobilizing support and donors meet to discuss and exchanges ideas with SADC on the RSAP and its implementation. The supported projects are regularly presented in the WSRG. At the overall SADC level, coordination is managed through the annual consultative meetings.

2.5.2 The SADC Hydrological Cycle Observing System project phase one (HYCOS) financed by the EU was launched in 1997. It involved the installation of 50 data collection platforms for meteorological and hydrologic parameters in the SADC region. The Surface Water Resources database and Watershed Map of Southern Africa using GIS, under the Aquaculture for Local communities Development Programme (ALCOM) project was implemented with the financial and technical assistance of FAO and the Belgian Government. The result was the establishment of a Website for the SADC Water sector, geared towards facilitating the exchange of information at the regional level.

2.5.3 The USAID, UNDP and GEF supported programme in groundwater is geared towards ensuring sustainability and participation through a capacity building component including (i) creation of an enabling environment with appropriate policy and legal frameworks; (ii) institutional development; and (iii) human resources development and strengthening of managerial systems.

2.5.4 The Limpopo River basin sub project on Protection and Strategic Uses of Groundwater Resources in the trans-boundary Limpopo Basin and Drought Prone Areas of the SADC Region is financed by UNDP, SIDA and French Government and implemented by the World Bank. The WaterNet, a regional program to strengthen capacity for Integrated Water Resources Management in the Southern Africa region through training, education, and research is supported by the Netherlands government and is implemented through a network of universities and other training institutes from the University of Zimbabwe.

2.5.5 The World Bank’s Africa Water Resources Management Initiative (AWRMI) is supporting SADC in developing and implementing a portfolio of regional projects, as well as in supporting several countries in water policy analysis and reform. The AWRMI seeks to establish partnerships with other multi- and bilateral donor agencies and members of the civil society in order to strengthen ongoing and planned initiatives. An overview of the donor interventions in the SADC Basins is shown in Annex 7.

2.6 POVERTY, GENDER, HIV AND AIDS, MALARIA AND WATER RESOURCES

2.6.1 It is estimated that between 40 and 50 per cent of the sub-region’s population lives in extreme poverty as reflected by poor social indicators such as high levels of malnutrition, unemployment, underemployment, declining life expectancy and low access to the basic services and infrastructure needed to sustain basic human capacities as shown by the socio economic indicators. The region has the highest proportion of the people subsisting on less than $1 a day. Zambia has the highest level of poverty, with 86 per cent of the population estimated to be living below the poverty line. It is followed by Zimbabwe (74%), Mozambique (69.5%), Angola (67%), Swaziland (66%), Malawi (54%) and Tanzania (51%). The linkage between water poverty and MDGs is presented in Annex 8.

2.6.2 In 1997 the Heads of State and Government signed the SADC Gender and Development Declaration and committed themselves to promoting women’s full access to

and control over productive resources, repealing all laws that discriminate against women, and encouraging mass media to disseminate information and materials in respect of the human rights of women and children. The SADC Secretariat’s Gender Policy guides the mainstreaming of gender issues in its development programmes. The SADC Council of Ministers approved new recruitment procedures that are based on a quota system. It stipulates that no member state can hold more than one position in the top seven positions: the posts of executive secretary, deputy executive secretary, chief director and the four directors. Further, at least a woman must hold one of the top three posts. For vacant positions, member states are required to submit four candidates of which, 50 percent shall be female. In addition, SADC countries have committed themselves to have 30 per cent of all positions in political and decision-making structures to be occupied by women by 2005.

2.6.3 The greatest threat to the region’s human resources is the HIV and AIDS pandemic. SADC is the worst affected region in the world and it has one of the highest rates of infection in Sub–Saharan Africa. It has responded by adopting a common vision and platform of action called the Maseru Declaration on HIV and AIDS in July 2003. According to the RISDP, the region will develop and strengthen the capacity for mainstreaming of HIV and AIDS at all levels and providing mechanisms and frameworks for the development of guidelines and exchange of best practices. It has set out a target to halt and begin to reverse the spread of HIV and AIDS by 2015. SADC has established an HIV and AIDS Unit in the Secretariat in 2005, and has developed an integrated and detailed HIV and AIDS Strategic Framework action plan and programme (2005-2009).

2.6.4 Malaria is the second leading cause of morbidity and mortality and responsible for up to 30% of outpatient health facility attendances and 40% of inpatient hospital attendances in the region. Under-five children and pregnant women are the main risk groups. It has been identified as a major impediment to socio-economic development and cause of poverty in the SADC region. A high level of political commitment was demonstrated by SADC leaders who signed the Abuja Declaration in 2000 where 44 African heads of state met to discuss strategies to tackle malaria as a single public health issue

2.6.5 The Health Unit established in SADC is to strengthen the Public Health Sector in the SADC countries. The Health Unit advocates and co-ordinates the national activities in the region in particular communicable and non communicable diseases, epidemic diseases in particular HIV&AIDS, Malaria, acute and chronic diseases, heath systems and management of information, data surveillance and standardisation, harmonisation of health policies, development of regional programmes, projects and guidelines on health, management of disaster and other health related hazards in the region.

3 TRANSBOUNDARY WATER RESOURCES MANAGEMENT

3.1 The management of the trans-boundary water resources in SADC region is in accordance with the Water Protocol. The management is done through joint water commissions and River Basin organisations. Mozambique and Zimbabwe have already established a Joint Water Commission (JWC) for the management of joint water resources. The objective of the JWC is to “act as technical adviser to the Parties on matters relating to the conservation, development and utilization of the water resources of common (bilateral) interest to the Parties and to perform such other functions pertaining to the conservation, development and utilization of such resources as the Parties may from time to time agree to assign to the Commission”.

3.2 The major functions of the JWC are to advise the parties on measures and arrangements to determine the available water, existing utilization levels, reasonable demand, relevant data and information, criteria for potential conservation, allocation and sustainable utilization and prevention of pollution of the water resources. The following are issues that the JWC would deal with: a) Sharing of data and information, b) Identification and preparation of guidelines for implementation and operation of joint investment projects, c) Sharing of the water available in the catchment, d) Environmental protection measures, e) Monitoring of water resources utilization and protection, f) Issues of common interest and concern that the JWC would like to consider.

3.3 The process is ongoing to establish a Joint Water Commission between Mozambique and Tanzania. The Swiss Agency for Development and Cooperation (SDC) is supporting the establishment of the JWC.

Mozambique

3.4 The main instruments underpinning the water sector in Mozambique are the Water Law (1991) and the National Water Policy (1995). The Water Law is the most important legal document concerning water resources management in Mozambique. It establishes water resources that are public domain, are within the competences of the Government to manage. The Water Law advocates cooperation with the other watercourse states to ensure a coordinated management frameworks for the shared river basins. This is reinforced by the signature and ratification by Mozambique of the SADC Protocol on Shared River Basins.

3.5 The National Water Policy defined the main policies: satisfaction of basic needs, participation of the beneficiaries, water prices to reflect the economic value of water, regulation and monitoring of service providers, principle of integrated water resources management, water resources development plans for the major river basin and priority to reach agreements with other riparian States in shared river basins, de-centralization of water resources management at the operational level to autonomous regional water administrations (ARAs).

3.6 The main institutions involved in the water management in Mozambique are the National Water Council, the Ministry of Public Works and Housing, the National Directorate of Water (DNA) and the Regional Water Administrations (ARAs). The National Water Council is a consulting body of the Council of Ministers for water related issues.

3.7 The Ministry of Public Works and Housing is responsible for all water issues. The Ministry promotes the best use of the national water resources, proposes the policies for the development of water resources and implements them, promotes the inventories of water resources and water requirement and its balance at the national and river basin levels.

3.8 The DNA is the main institution responsible for the management of the water sector in the country. It promotes the definition of policies of water resources development, drinking water supply and sanitation; promotes the inventory and permanent balance of the water resources and water requirement at river basin level; legislation on water issues, t concerns the waters in international rivers.

3.9 Five Regional Water Administrations (ARAs) have been legally created, namely ARA-Centro, ARA Norte, ARA Sul, ARA Zambezi and ARA Centro-Norte. The institutional structure of the Water Resources Management in Mozambique is presented in Annex 9A.

Tanzania

3.10 Water resources management in Tanzania has been established in the government institutions since colonial times in traditional line organizations, i.e. from the concerned central ministry through Regional and District Water Offices. Tanzania has a National Water Policy (2002) and a National Water Sector Development Strategy. The Policy and Strategy have introduced various reforms in the management of water resources. The essence of these reforms consists of a decentralization of the responsibilities for the day-to-day operational activities to basin or catchment based institutions under the responsibility of their own boards and advisory bodies, leaving the responsible ministry with policy and regulatory functions. Nine Water Boards have been established in Tanzania, covering the country’s nine river basins.

3.11 The Ministry of Water and Livestock Development is responsible for managing the nation’s water resources. It will determine policies, legislation, sectoral coordination and integration, national water assessments, monitoring and evaluation, information management systems, and preparation of regulations.

3.12 Since water resource management and development will be undertaken on the basis of River Basins, this is the level for data collection, processing and analysis, water allocation, pollution control, preparation of water utilization plans, collection of the various fees and charges, and resolution of various water related conflicts.

3.13 Each River Basin is subdivided in catchment Water Committees and sub-catchment Water Committees that are composed of representatives from the public and private sector, and from the Water User Associations within the respective Basin. The role of the catchtment Water Committee includes preparation and implementation of catchment plans, and resolution of conflicts within the catchments.

3.14 Water Users Associations (WUAs) or Water Users Groups (WUGs) will be the lowest appropriate level of management. They provide legitimate representatives in Basin Boards and Catchment Committees. The institutional structure of the Water Sector in Tanzania is presented in Annex 9C.

Zimbabwe

3.15 The Zimbabwe National Water Authority (ZINWA) was established in terms of the Water Act No 11/98 and is responsible for the development and management of the national water resources in Zimbabwe. It is meant to operate on a self-financing basis. In addition to establishing ZINWA, the Water Act introduced a number of new principles in the management of water resources. The main ones were: no private ownership of water, water rights are no longer given in perpetuity, water permits are revised with consideration taken to the basin wide water use, no differentiation in management between surface and ground water, and the establishment of Catchment Councils. Other noteworthy changes were the introduction of water permits, fees for applications for permits as well as for the commercial use of water.

3.16 Seven catchment offices called Catchment Councils, replacing the former River Boards. A Catchment Council (CC) is established by a statutory instrument under the Water Act, through the declaration of a river System by the Minister in consultation with ZINWA. The Councils cover the main river systems of the country viz. Gwayi, Sanyati, Manyame, Mazowe, Save, Runde and Mzingwane and are constituted from members of its sub- catchment councils. It is composed of elected representatives of the stakeholder groups in its area.

3.17 The sub-catchment council is the operational arm of the Catchment Council. Its main function is to regulate and supervise the exercise of rights to water within the area for which it was established. The Catchment Councils and the Sub-catchment councils are the focal point for stakeholder interaction. The water sector organisation in Zimbabwe is as illustrated in Annex 9B.

4. THE PROJECT

4.1 PROJECT CONCEPT AND RATIONALE

4.1.1 By definition, a watercourse is "a system of surface waters and groundwater constituting, by virtue of their physical relationship, a unitary whole and normally flowing into a common terminus”. Following from this, an "international watercourse" is a watercourse whose parts are situated in different States and whose effective management requires the participation and coordination of all the concerned states. SADC has several such international watercourses (see Map on Annex 1 and Annex 10) and recognizes the need for regional cooperation in their management. SADC also recognizes the importance of adopting an integrated river basin management approach in pursuit of benefits related to poverty alleviation, improved human health, food security, environmental sustainability and regional security. For this reason, the regional efforts to improve and foster institutional and policy reforms necessary for the management of surface and groundwater have been given great impetus in the Regional Strategic Action Plan for Integrated Water Resources Management for SADC.

4.1.2 In order to facilitate the joint planning and management of shared watercourses in the region, SADC member states have signed a Shared Watercourses Protocol. As part of the process of implementing the Protocol, thirty-one water resource development projects have been selected for implementation. The selection was based on five criteria that represented agreed development needs of countries in the region. For the implementation of the selected projects, SADC member states agreed to adopt a regional approach to trans-boundary aquifers. These projects are included in the updated RSAP-IWRMD.

4.1.3 The proposed Shared Watercourses Support Project covers three SADC shared watercourses, namely Ruvuma, Buzi and Save which spread across three states (Mozambique, Tanzania, and Zimbabwe). SADC has fifteen river basins and the choice to focus on the three has taken into consideration a number of factors. First, the river basin must have been identified in the RSAP. Second, given that there are several donors providing support to the SADC region, it was important to focus on those river basins that had not yet received donor support. Third, the river basins selected for Bank support had to be eligible for ADF resources and therefore situated in ADF-eligible countries. Fourth, of the

eligible basins, it was important to focus on those basins with high population and high poverty levels. Fifth, there was general consensus that the basins should have significant potential for reducing down-stream flooding, especially in Mozambique.

4.1.4 The proposed support to the three basins is directed primarily at three of the four objectives enunciated in the RSAP-IWRM. These are the first objective (Regional Water Resources Planning and Management), the third objective (Water Governance) and the fourth objective (Capacity Building). There is also potential to support the needs highlighted under the second objective (Infrastructure Development) through appropriate pilot schemes under the Community Basin Management component of the project. The pilot schemes will stimulate local stakeholders’ involvement in river basin planning, will be used as practical capacity building tools, and the RBMIs’ staff will gain experience on how to approach and implement at local stakeholders’ level. The proposed support therefore addresses key challenges faced by SADC in the implementation of the Shared Watercourses Protocol.

4.1.5 The project is also part of the RISDP that is regarded as the SADC’s expression of NEPAD, especially the program on trans-boundary water resources management within NEPAD-STAP. The proposed project has very important links, impact and interactions with the MDGs and the water sector. In addition, the IWRM targets adopted under the heading ‘Integrated water resources management and efficiency plans by 2005’ for the water sector was defined as one of the main development factors at the World Summit for Sustainable Development in Johannesburg 2002.

4.1.6 The Bank’s proposed support to the SADC is in line with its policies on Regional Integration and Economic Cooperation and on Integrated Water Resources Management. The Bank’s contribution seeks to encourage and support the joint efforts of the SADC riparian countries in developing strategies for integrated management and development of the shared water courses based on mutual agreement. The results of the monograph and strategy developments financed by the Bank would lead to bankable projects, which should contribute positively to the collaborative approaches in the development and management of shared water resources. Overall, it would also foster regional co-operation and integration by helping to strengthen the RBMIs institutions, which will be the basis for achieving effective use of trans-boundary water resources, and hence serve as an instrument of regional integration. Furthermore, Bank Group participation in the SADC RISDP program will foster collaboration with other development partners.

4.2 PROJECT AREA AND PROJECT BENEFICIARIES

4.2.1 The Ruvuma is the boundary river between Mozambique and Tanzania and is part of the development efforts called the Mtwara corridor. The corridor covers a spatial area including Malawi, Zambia, Tanzania and Mozambique. The river basin area is estimated at 152,200 km2 with about 99, 530 km2 located in Mozambique and 52,200 km2 in Tanzania. The annual precipitation averages 1,160 mm and varies from 500 mm to 2,000 mm in the highlands. There are no functioning gauging stations in the main river so the runoff characteristics are unknown. The annual flow has been estimated at about 28 km³, of which the contribution of Tanzania is estimated at 10 km³.

4.2.2 The Ruvuma basin area on Tanzania side in made of two major regions namely Mtwara and Lindi regions. The total population of Mtwara region is 1,128,523 inhabitants according to the 2002 Census. The female population is 594,121, which is 53%. Intercensal

growth rate is 1.7% (1988-2002). The average household size is 3.8 and there are 293,908 households. The population of Lindi Region is, according to the population census of 2002, 791,306. Some 90% of the population is living from agriculture. The Mtwara region has 5 districts: Mtwara/Mikindani Urban, Mtwara Rural, Masasi, Newala, and Tandahimba. The districts are divided up in a total of 21 divisions, 98 wards and 554 villages.

4.2.3 The Mtwara Port Master Plan envisages expansion that will double the number of berths from current number to five berths. Besides the area of 200 acres reserved for port expansion, there is also an area of 60 acres, which is reserved for port related development activities including Export Processing zone (EPZ) and distribution activities.

4.2.4 The immediate hinterland of the port is agriculturally rich areas famous for cashew nuts, coffee, tobacco and simsim farming. The port should also be able to cater for neighbouring countries of Malawi, Mozambique and Zambia. The population in the area is mainly subsistence farmers and fishermen. The major import commodities are foodstuffs, i.e. maize flour, rice, beans, sugar, wheat/wheat flour, beer, cement and other general cargo. Principal export commodities are raw cashew nuts, cassava roots, simsim and sisal. The total population on the Tanzanian part is estimated at 2.2 million and another 1 million in Mozambique.

4.2.5 Groundwater resources on the Tanzanian part were developed during the early 1970’s mostly through the development of boreholes for domestic water supply, those wells have since deteriorated and most are out of order. Generally, land use, hydro-meteorological and groundwater data are scarce, time series data interrupted and gauging stations abandoned. The quality of earlier generated data is questionable.

4.2.6 The Save River runs from Zimbabwe and discharges into the Indian Ocean in Mozambique. A main tributary Runde joins the Save close to the border between Zimbabwe and Mozambique. In Zimbabwe these two fall under separate Catchment Councils, namely Save and Runde. The total Basin Area is 110,420 km2 of which 84,500 (79%) is in Zimbabwe and 23 620 (21%) in Mozambique. The average annual runoff is estimated at 6,870 Mm3/yr.

4.2.7 Save has an average annual runoff of 5,954 Mm3/year at the border, about 30 % of the country’s total. Some of Zimbabwe’s hydro-meteorological stations have data going back as far as 1912 while some have been operating for less than ten years; however, strategic stations have data for over 50 years. The data is of good quality for use in the assessment; however a number of stations were damaged during the floods in 2000. The gauging data series in Mozambique are of poorer quality and moreover flooding destroyed many stations.

4.2.8 The Save river basin population in Zimbabwe amounts to about 3 million of which about 280,000 lives in urban areas. Four major urban centres exist viz. Masvingo (the provincial capital), Zvishavane, Mashava (mainly asbestos mining towns) and the sugar conurbation of Chiredzi/Hippo valley. The hinterland is a mix of large scale, small and subsistence farmers. The Save catchment falls from an altitude of approximately 2000m above sea level in the Eastern Highlands to 150m on Zimbabwean territory alone. The total population in the Mozambican part is about 300,000 people.

4.2.9 The existing water storage in Zimbabwe is 2,734 Mm3 in 13 dams. The Hippo Valley Estates and Middle Sabi regions constitute among the biggest singular irrigation schemes in Zimbabwe. The largest inland lake Mutirikwe is on a tributary of the Runde River. These

dams are primarily for irrigation and urban water supplies. Existing irrigation schemes on the main Save catchment in Zimbabwe are Middle Sabi 5000 ha, and Chisumbanje 2400 ha. A total of approx. 20,000 ha are under irrigation in various smallholdings.

4.2.10 The Runde sub-basin of the Save is home to the largest irrigation estates in Zimbabwe. Approximately 40,000ha is under sugar-cane plantation. There are also various smallholder schemes. One large dam is under construction viz. Tokwe-Mukorsi, which will further boost the areas under irrigation. The potential irrigable area in Zimbabwe is about 335,000 ha, most of which is found in the lower reaches of the Save, Runde and Mutirikwe rivers. Irrigable areas in Mozambique are 220,000 ha, 46,000 ha classified as well suitable, 35,000 ha moderate and 140,000 ha marginally suitable for irrigation. The main problem in Zimbabwe is considered to be erosion and siltation, due to poor agricultural management practices and fuel wood deforestation.

4.2.11 The Buzi catchment area is 27,700 km2 of which 24,500 (88%) is located in Mozambique and 3,200 (12%) in Zimbabwe. The Buzi catchment in Zimbabwe is heavily utilized, while the lower basin in Mozambique is not as utilized as the Save basin. Buzi was severely hit by the flooding in 2000–2001, and is commonly prone to flooding. Thus, gauging stations are regularly destroyed and out of order and flow data generally unreliable. A major dam, Chicamba is located is the tributary Revué for hydropower generation. The main activities in the Buzi catchment are hydropower, bananas, beans, vegetables, forestry and tea growing.

Table 2: Project River Basins characteristics River Basin area in River Mean annual SADC Member Basin area Basin area basin SADC length run off States within country within (Km2) (Km) (Mm3/yr) (Km2) country (%) Buzi 27,900 250 2,500 Mozambique 24,780 88.81 Zimbabwe 3,120 11.18 Ruvuma 152,200 800 15,000 Mozambique 99,530 65.39 Tanzania 52,200 34.30 Malawi 470 0.31 Save 116,100 740 7,000 Mozambique 30,320 26.12 Zimbabwe 85,780 73.88 Source :SADC Secretariat

4.3 STRATEGIC CONTEXT

4.3.1 The project is consistent with the strategic plans of SADC as articulated in RISDP, in general, and in the RSAP-IMRMD in particular. RSAP-IWRMD has become a common and broad integrated water resources management framework for the region. It aims to contribute to the sector goal of promoting economic growth and regional economic integration in SADC, as well as reducing poverty. The project’s objective and activities are part of NEPAD’s framework for integrated water resources agenda for the development in Africa. The project is in line with the Bank Regional Assistance Strategy for SADC 2004-2007, as one of the intervention to be undertaken under the water sector. It is also consistent with the requirements of the ADF Guidelines for Financing Multinational Operations by facilitating cooperation among member `countries in addressing common problems, deepening regional integration and assisting to remove non–tariff barriers to trade. Finally, the project strategy is the most appropriate means of addressing the identified constraints. The project focus member states attention to joint operational issues of the shared river basins and the need for the establishment of the river basins organisation as an effective mean to address the joint issues in a consultative manner. 13

4.3.2 The focus of the project on river basins shared between two and more contracting parties is line with the Ramsar Convention, which makes it clear that the parties are expected to cooperate in the management of such resources. In addition the declaration of the Second World Forum in Paris March 1998, emphasized that riparian countries need to have a common vision for the efficient management and effective protection of shared water resources. It suggests the establishment of international river commissions by the concerns countries to facilitate consultation and to ensure broad coordination.

4.3.3 The project also underpins the international water agenda agreed at two landmark conferences in 1992, sponsored by the UN system: the International Conference on Water and the Environment (ICWE) in Dublin, and the United Nations Conference on Environment and Development (UNCED) in Rio de Janeiro, Brazil. The two conferences, highlighted a number of principles: that water must be managed in a holistic way; institutional arrangements need to be adjusted to allow stakeholder participation in all aspects of policy formulation and implementation, including devolution of management to the lowest appropriate level; the central role of women; and the management of water as an economic resource as well as a resource for meeting basic needs.

4.4 PROJECT GOAL AND OBJECTIVE

4.4.1 The Sector goal is to ensure the development of integrated water resources management and related physical infrastructure development that contributes to regional integration and poverty reduction

4.4.2 The Project Objective is to ensure a sustainable framework for an integrated planning and management of shared water resources in the Buzi, Save and Ruvuma river basins for development and support of improved livelihoods of the local communities.

4.5 PROJECT DESCRIPTION

4.5.1 The project will consist of five components: (A) River Basin Monographs and Strategies Development, (B) Enhanced Knowledge and Information Support System (C) Community Basin Management, (D) Project Management and Capacity Building, and (E) Audit Services.

A River Basin Monographs and Strategies Development

(A1) Development of River Basin Monographs

4.5.2 The subcomponent will produce river basin monographs for the three river basins involving water use profile and water use quality profile. The basin water use and quality profiles entail an inventory of water use and water related development projects, current water quality issues and trends in the river basin. The Monographs will provide the necessary understanding of the location, source, and quantity of river basin water use, but also provides an understanding of how water is used. It will consolidate the available information; secure safe storage of data and accessibility to the database created within the project and provide an information database for analysis and synthesis for decision-makers in the operative work as well as for development of project activities. The database will be based on a GIS platform and comply with other databases in the region. The database will have interfaces for inputs as

well as for outputs to communicate with other information sources and partners like water management offices in the river basins, national authorities and SADC.

4.5.3 The common database of each basin will include the following: 1) consolidate and update existing information on: socio-economy, surface water resources, groundwater resources, dams and other hydraulic works, water quality and sediment transport, pollution and impacts on the environment, water supply and sanitation, irrigation and forestry, industries and mining, fisheries, wildlife and tourism, environmental flow requirements, energy and infrastructure, 2) following cross-cutting issues will be addressed including: poverty alleviation, promotion of gender equality, combating malaria and the HIV and AIDS, capacity building, and good governance.

A2: River Basin Strategy Development

4.5.4 This subcomponent will develop river basin development scenarios, will identify investment opportunities, ranking the future investments projects which will include water resources development, will initiate pre-feasibility studies, will hold several stakeholders workshops and will develop the selected scenarios into a River Basin Strategy. The starting point for the development of water demand projections requires an understanding of the current economic and demographic conditions in the basin. The result of the Monograph report will be key input in this regard. The identification of historic changes and trends in the river basin, plus the evaluation of the most important sectors from an economic and water use point of view, help define the focus of future economic and demographic scenarios. The component will evaluate the current water use and assess the future development sector-wise and formulate the water demands and loads on the water resources and the environment. Environmental and social assessment will be developed in an integrated manner to ensure sustainable development.

4.5.5 The River Basin Water Development Scenarios will be developed and a basin-wide strategy for joint IWRM will be agreed upon. This will be done in a fully participatory manner involving all levels of stakeholders. Corresponding activities would include the identification and ranking of long-term investment opportunities including pre-feasibility studies. The formulation of principles of water allocation between the two countries sharing one River Basin will take its starting point in defining the principles of the issuing of water permits.

4.5.6 The process of developing the river basin development scenarios and the development of a joint IWRM strategy will include the following: updating of database and current water use by sector, updating of GIS and modelling applications, on-the-job training of counterpart staff, sector-wide formulation of future water demands, analysis of potential for water conservation and water demand management practices, review and prepare a proposal for water permit allocation, identification, analyses, and preliminary ranking of sustainable development oriented investments, preliminary EIA, SIA and financial analysis of the individual projects, development of implementation plan, formulations of principles of water allocation between the countries, analyze and propose the institutional and financing arrangements for implementing, formulation of alternative development scenarios, analyses and ranking of alternative development scenarios, organization of stakeholder workshops, adoption of most appropriate development scenario and strategy. Writing of draft development scenario report, organization of stakeholder workshop, adoption of most appropriate development scenario, and preparation of final development scenario report.

4.5.7 The outputs of the river basin development scenarios are the identification of the investment opportunities, which are the foundation for the development scenarios. The development of a joint IWRM strategy based on the river basin development scenarios will have as output prepared and ranked investment projects, the adoption of IWRM strategy and final IWRM strategy report.

(B) Enhanced Knowledge and Information Support System (EKIS)

4.5.8 This project component will strengthen the hydro-meteorological and groundwater- gauging networks and the established operational database. Without a comprehensive knowledge of the water resource that they will be mandated to manage, SADC and RBMIs and the partner agencies find it very difficult to assess the size and extent of the resource, the potential for future development, and the dangers inherent in unregulated use.

4.5.9 Through the database the Project will strengthen the collection, storage, management, and sharing of data and information for surface water, groundwater, and water quality. The GIS-based database will be set up with access to it by river basin offices, national authorities and SADC. This will include a primary network for groundwater and hydro-meteorological data, a River Basin Information Management System (RBIM), a common hydrological data format and procedures adopted between riparian countries. A gauging network plan will be formulated, to include procedures for management and maintenance of the network. The systems for utilizing the data for assessment of the surface and ground water resources need to be communicated with other SADC projects and countries in order to standardize the systems in the region.

4.5.10 The surface water related activities include (i) the establishment of gauging stations, (ii) the provision of hydrometric equipment, and (iii) the provision of data management equipment as well as transport facilities for the data collection staff. The groundwater related activities include (i) construction of observation wells, (ii) the provision of measuring instruments and data management equipment, and (iii) training in their installation and use. For water quality the activities will consist of upgrading laboratories and equipment for water quality testing. In conjunction with the above activities basin wide information sharing and decision support tools will be developed

4.5.11 The River Basin Information Management system comprises a Decision Support System (DSS) as follows: GIS, database and information management, compilation of existing digital data, digitising of outstanding geographical data, design and development a common database, definition of data sharing and distribution, conduct on the job training courses in GIS and database management, hydrological/river basin models: selection of hydrological/river basin models, compilation of input data, database build-up, patching and quality control of data, set-up of selected models, conduct introductory training courses in modelling and dissemination workshops.

4.5.12 The communication with stakeholders includes: design and agreement of protocols and formats for data exchange, launching a project website linked with the official SADC website, training of staff in maintenance and updating of the website, preparation of information campaigns directed to stakeholders.

C: Community Basin Management

4.5.13 An important aspect in river basin planning is the involvement of communities and local organizations. Capacity building at the Sub-Basin level will be two fold: 1) assessing needs and developing training materials specific to the Sub-Basin level using training media that local population can understand; and 2) hands on training where local population, under the supervision of the RBMI, will learn how to internalize and implement best practice conservation and protection work. Selection of the activities to be undertaken will result from the entire process of rapid appraisal and assessment of pilot projects at the Sub-Basin level and will include identification of problems, discussions and planning with the Sub Basin stakeholders.

4.5.14 It will also be a learning tool for the RBMI staff on how to approach, design and implement capacity building at those lower levels. At the end of this process the staff will be better prepared to disseminate the practices to other Sub-Basins. At the start of this project component, a limited number of Sub-Basins will be identified in selected ecological areas of the river basin depending on the key water resources problems in order to serve as a learning and demonstration practice for both RBMI staff and for Sub-Basin population.

4.5.15 The criteria for selection of pilot projects will include one or more of the following criteria: a trans-boundary dimension, tangible regional poverty reduction benefits, and ability to upscale for future development, capacity to contribute to sustainable use of water resources and innovative implementation arrangements and ownership as indicated in Annex 11. The pilot projects considered for support should, to the extent possible, have one or more of the following elements built into their design: capacity building, environmental conservation, environmental sanitation and hygiene promotion, mainstreaming of gender, HIV and AIDS. In Zimbabwe a system for stakeholder participation, where the stakeholders are represented in Catchment Councils is already in practice. Similar arrangements have been initiated in Mozambique, e.g. a Pungwe Basin Committee was established in July 2004. In Tanzania the water user associations are already taking part in the Mtwara region using the participatory rural appraisal techniques.

4.5.16 To ensure success it is imperative to (i) establish mechanisms to identify and involve stakeholders in planning and management of river basins, including an inventory of the land tenure arrangements within the river basin, (ii) facilitate the active participation of stakeholders, and sharing of authority and responsibility for resource management agreed by all parties, (iii) provide fora for discussion on river basin management between water management agencies and stakeholders, particularly local communities, (iv) document and promote river basin management practices developed through traditional knowledge and skills, (v) support capacity building of community-based organizations and NGOs to develop skills for monitoring or management of resources within river basins, (vi) design and implement communication, awareness and education programmes on the importance of water resources management, (vii) develop awareness campaigns to minimize those activities leading to the degradation of river systems, poor sanitation, and clearance of forests in the catchments and (viii) identify, design and implement community-based pilot projects.

4.5.17 Community-based pilot projects will be identified, through the RBMIs, within the framework of the project’s aims and objectives (e.g. water supply, small dams, flood warning systems, watershed rehabilitation, small scale irrigation rehabilitation, etc.) along the lines of what is indicated Annex 11. The preparatory activities required will be carried out by the

RBMIs concerned, with the assistance of local NGOs and local consultants and TA that the project would provide. The output of this component will be a total of approximately twenty pilot projects implemented in the three countries , each not exceeding USD 200,000 .

D: Project Management and Capacity Building

4.5.18 Effective River Basin Organizations are key to the success of the implementation of the SADC protocol on shared watercourses. The Project Implementation Agency (PIA) offices in Ruvuma Water Board Office (Tanzania), ARA Norte (Mozambique), ARA Centro (Mozambique) and Save and Runde Catchment Council Offices (Zimbabwe) will be provided with critical computing and office equipment as well as vehicles and motorcycles for use during project implementation. Each PIA will also be provided with a Technical Assistant to support the core implementation team. The SADC Secretariat’s Water Division’s coordinating and management role will be supported under this component through three Technical Assistants.

4.5.19 Training of four staff members in each RBMI is envisaged, covering relevant academic and tailor-made courses in water resources management, GIS/computer modeling, etc. The courses will be at local as well as at international institutions. On-the-job training by international and domestic experts or approved NGO groups and secondment of selected personnel to relevant operational agencies is also included. Some of this training and related technical advice will be provided through a long-term twinning relationship between PIAs and a parallel water management agency in other countries. This twinning relationship will facilitate the provision of very practical, targeted training relating to specific water resource management functions and tasks. It will also allow greater flexibility in responding to emerging technical issues and training needs on a rapid-response and well-informed basis.

4.5.20 The output of this component will be well organized, managed and equipped SADC PCU and five RBMIs.

E: Audit Services

4.5.21 This component comprises the annual project audits to be done by external auditors during project implementation and will incorporate technical audits as necessary.

4.6 PRODUCTION, MARKET AND PRICES

The principles of IWRM permit the possibilities for regional water trading as a strategic option for water resources planning in international river basins. The principal idea of the National strategies of the concerned countries is the sale of raw water to finance the operations of the water supervisory bodies. The production potential based on the annual river run off in the three river basins will form the basis for an assessment of the price level necessary for determining the sustainability of the autonomous RBMIs. The shared watercourses protocol provides an avenue for processing of compensation for loss of water in those areas of the watercourses where over developments in upstream occurs and has caused injury to the areas and population of those downstream of the watercourses. The general principle of the revised protocol incorporates benefits sharing from the use of water.

4.7 ENVIRONMENTAL IMPACT

4.7.1 The project is categorized environmental category 2. River basin development is aimed at protecting and developing in a sustainable manner the water resources of a watershed, incorporating the needs of multiple stakeholders. The project will improve water resources information; provide tools and systems for joint and integrated water resources management and development at river basin level; provide improved hydro-meteorological networks for the three river basins; and implement a limited number of community based pilot projects.

4.7.2 During the implementation of the project special considerations will be given to (a) reduction of deforestation and poor land use in catchments areas which alter runoff patterns, inhibit natural recharge of groundwater, and increase risk of flooding, (b) measures which lead to less silt deposition in aquatic ecosystems; and (c) water storage schemes which can change the characteristics of the river flows, etc.

4.7.3 The community based pilot projects will promote knowledge for water resources management at community level; for better farming practices; for reduction of erosion; for reduction of water pollution and for improved water supply, sanitation and health education.

4.7.3 The implementation schedule of the mitigation and environmental management measures is the schedule of the project itself since the project is ultimately an environmental management and monitoring project. The Environmental and Social Management Plan summary is shown in Annex 12.

4.8 SOCIAL IMPACT

4.8.1 The development of joint co-operative action between the three riparian states should lead to greater equity in the building of understanding between nations in the pursuit of a "shared vision". This in turn should lead to real social benefit including employment creation, community development projects, peace, poverty alleviation and a general improvement in quality of life in line with RISDP, RSAP-IWRMD, gender policy, malaria and HIV and AIDS actions plans.

4.8.2 Physical development and utilisation of the river basin water resource will have a positive impact on the resource itself. Effective utilisation of the shared water resources will be done in a sustainable manner to ensure the protection of the resource through limited utilisation and extraction, enforce improved watershed management, ensure better water quality, weed control, pollution control and a variety of other issues are the key issues to be addressed by the project.

4.8.3 The signing of the protocol on shared water courses have lend credence to the SADC countries resolve to put aside the critical issues of sovereignty and security for a common platform for the development of the region important natural resource. In agreeing to address the issues in a coordinated manner, SADC countries have demonstrated their willingness to be in line with the UN Convention on the Non-Navigational Use of International Waters, and other treaties, agreements and protocols to which they are party.

4.9 PROJECT COSTS

4.9.1 The total cost of the project, net of taxes and customs duties, is estimated at US$ 15.23 million, i.e. UA 10.43 million, of which 75% is foreign cost and 25% is local cost. For the purpose of pricing, all costs have been estimated in US$ and converted into UA at the exchange rate applicable at the Bank for the month of September 2005. A 10% physical contingency has been included, together with price contingencies at 3%. The detailed cost estimates are presented in Annex 13. The summary of project costs by component is shown in Table 4.1 below.

Table 4.1: Summary of Project Cost Estimates by Component

(US$ Million) (UA Million) Foreign Local Foreign Total Local Foreign Total Exchange

1. Monograph and Strategy Development - 4.83 4.83 - 3.31 3.31 100 2. EKIS 0.33 1.22 1.54 0.22 0.83 1.05 79 3. Community Basin Management 1.98 1.32 3.30 1.36 0.90 2.26 40 4. Project Management and Capacity Building 0.88 2.30 3.18 0.60 1.57 2.17 72 5. Audit 0.02 0.18 0.20 0.01 0.12 0.13 90 Total BASELINE COSTS 3.20 9.84 13.04 2.20 6.74 8.93 75 Physical Contingencies 0.32 0.98 1.30 0.22 0.67 0.89 75 Price Contingencies 0.26 0.62 0.88 0.18 0.43 0.60 71 Total PROJECT COSTS 3.78 11.45 15.23 2.59 7.84 10.43 75

4.9.2 The summary of project costs by category of expenditures is shown in Table 4.2 below.

Table 4.2 Summary of Project Costs by Category of Expenditure.

(US$ Million) (UA Million) Foreign Local Foreign Total Local Foreign Total Exchange

A. Goods - 1.67 1.67 - 1.15 1.15 100 B. Works 2.31 1.32 3.63 1.58 0.90 2.48 36 C. Services 0.02 6.51 6.53 0.01 4.46 4.47 100 Operating Costs 0.88 0.34 1.22 0.60 0.23 0.83 28 Total Base Costs 3.20 9.84 13.04 2.20 6.74 8.93 75 Physical Contingencies 0.32 0.98 1.30 0.22 0.67 0.89 75 Price Contingencies 0.26 0.62 0.88 0.18 0.43 0.60 71 TOTAL 3.78 11.45 15.23 2.59 7.84 10.43 75

4.10 SOURCES OF FINANCE

4.10.1 The project will be financed by the ADF and the SADC Secretariat through contributions from the beneficiary countries in the proportions shown in Table 4.3 below. The ADF grant will be used to finance the River Basin Monograph and Strategy Development, Stakeholder Workshops, Computing and Office Equipment, Hydrometric Equipment, Motor Vehicles, Motor Cycles, Digital Maps, Satellite images, & accessories, Community Basin Management, Technical Assistance and Audit. The grant will also be used to finance part of the Motor Vehicles and Motor Cycles running costs during project implementation. The ADF grant will finance 100% of the foreign cost (UA 7.84 million) and

59% of the local cost (UA 1.54 million). The beneficiary countries will contribute the remaining 41% of local costs (UA 1.05 million).

Table 4.3: Sources of Finance (UA Million)

(US$ Million) (UA Million) Foreign Local Total Foreign Local Total Percent

SADC - 1.53 1.53 - 1.05 1.05 10.0 ADF 11.45 2.25 13.70 7.84 1.54 9.38 90.0 Total 11.45 3.78 15.23 7.84 2.59 10.43 100.0

4.10.2 The expenditure schedule during project implementation is shown in Table 4.4 below. As seen from the table, most of the expenditure is to be incurred during the second and third years when activities pick up after the initial period of procurement. Table 4.4: Expenditure Schedule by Component

(UA Million) 2006 2007 2008 2009 Total

1. Monograph and Strategy Development 0.74 1.14 1.57 0.40 3.85 2. EKIS 0.06 0.89 0.22 0.04 1.22 3. Community Basin Management 0.13 0.52 1.07 0.97 2.68 4. Project Management and Capacity Building 0.63 1.04 0.44 0.40 2.52 5. Audit 0.04 0.04 0.04 0.04 0.16 Total PROJECT COSTS 1.60 3.63 3.34 1.86 10.43

4.10.3 The expenditure schedule by financier is shown in Table 4.5.

Table 4.5: Expenditure Schedule by Source of Finance Financing (UA Million) 2006 2007 2008 2009 Total I. Investment Costs SADC 0.01 0.08 0.15 0.14 0.39 ADF 1.35 3.31 2.94 1.46 9.07 Total Investment Costs 1.37 3.39 3.09 1.60 9.46 II. Recurrent Costs SADC 0.16 0.16 0.17 0.17 0.66 ADF 0.07 0.08 0.08 0.08 0.31 Total Recurrent Costs 0.23 0.24 0.25 0.25 0.97

Total Financing of Costs 1.60 3.63 3.34 1.86 10.43

5. PROJECT IMPLEMENTATION

5.1 EXECUTING AGENCY AND INSTITUTIONAL ARRANGEMENTS

Executing Agency

5.1.1 SADC Secretariat will be the recipient of the ADF Grant and the project Executing Agency (EA). Project Execution will be based under the Water Division (Infrastructure and

Services Directorate) at the SADC Secretariat in Gaborone, Botswana. The Division is responsible for overseeing all SADC water development projects and will be in charge of coordinating and monitoring all the project activities. Having successfully overseen the implementation of various donor-supported programs over the years, the Division staff has acquired useful experience in performing this role.

5.1.2 However, as the staff complement in the Division is small (9 persons on full time basis) a Project Co-ordination Office (PCO) will be established within the Division and provided with three Technical Assistants (Project Coordinator/Water Resources Expert, Accountant and Procurement expert). The Project Coordinator and the Accountant will be present for the whole project duration while the procurement expert will be present during the first two years of the project. Upon project completion the activities will be handled by the River Basin Organisations in line with existing SADC implementation arrangements. There is therefore no need to create a permanent structure at the Secretariat for purposes of this project.

Implementing Agencies

5.1.3 At the country level the respective RBMIs will take on the role of Project Implementing Agencies (PIAs). This arrangement is in line with the approved implementation arrangements as articulated in the revised SADC RSAP and the SADC Annotated Strategic Plan 2005-2010. The River Basin Offices for the Save, Runde and ARA Centro will oversee the implementation of project activities on the Save and Buzi Basins (Mozambique-Zimbabwe) while the implementation of project activities on the Ruvuma Basin (Tanzania-Mozambique) will be handled by the Ruvuma Basin office and the ARA Norte. The implementation arrangement is as presented in Annex 14. The PIAs will be in charge of managing the projects once completed. To ensure sustainability of operations, the project cost includes a budget for training meant to upgrade the skills of the existing staff members in IWRM, GIS/models development and maintenance, etc.

5.1.4 There will be five Project Implementation Agencies, namely (1) the Ruvuma Basin Water Board (Ruvuma-Tanzania), (2) ARA-Norte (Ruvuma – Mozambique), ARA-Centro (Buzi/Save– Mozambique), ZINWA-Save (Buzi /Save -Zimbabwe) and ZINWA-Runde (Save/Runde-Zimbabwe). The offices for Save, Runde, ARA Centro and Ruvuma Basin Water Board already exist, while the ARA Norte office has been legally set up but is yet still to be operational. A fully functional ARA Norte office will be a condition for first disbursement grant disbursement.

5.1.5 Each of these PIAs will be the key implementation agency for the respective basin/county and will monitor and coordinate all related activities on the ground. In each of these offices there will be a core implementation team of four experts from existing staff, supported by a water resources management expert provided as technical assistance under the project. The Ministries responsible for water resources development in the specific country will support each PIA.

Project Steering Committees (PSC)

5.1.6 Two bilateral Project Steering Committees will be established to provide strategic and planning guidance for project implementation and to approve annual work plans and budgets for shared basins. It is proposed that the membership should comprise two representatives of

the SADC Secretariat (one from Water Division and one from the Gender Unit), Directors of Water Affairs at national level, representatives of the PIA’s and one representative of water users from each of the two member states concerned. The PSC will meet initially twice a year to review project implementation and handle other project related matters. Sector experts from their respective countries will support members of the PSC. The experts may be invited to participate in PSC meetings if it is considered necessary to do so. The establishment of the PSC by SADC shall constitute a condition of first disbursement for the Grant.

Joint Water Commissions (JWC)

5.1.7 Project implementation activities will be harmonized through the guidance of Joint Water Commissions. A JWC between Mozambique and Zimbabwe was established in 2002 and will oversee the activities on the Save and Buzi River Basins. Another JWC between Tanzania and Mozambique is being established with the assistance of the Swiss Development Corporation (SDC). This JWC will guide development activities in the Ruvuma River Basin. The JWCs will meet at least twice per year to review progress on the projects and provide relevant policy guidance. Establishment of the Mozambique/Tanzania JWC will be a condition of first disbursement for the Grant.

5.2 IMPLEMENTATION SCHEDULE AND SUPERVISION

5.2.1 The project will be implemented over a period of 48 months starting in 2006. The Fund will closely monitor the implementation of the project through regular follow–up, review and supervision missions; the latter would be undertaken at least 2 times a year. The tentative implementation plan for the project is as follows:

Activity Target Date Board Approval December 2005 GPN Publication February 2006 TA Procurement March 2006 Consultants - Procurement May 2006 TA Mobilisation June2006 Consultants - Mobilisation August 2006 Community Based Pilot Projects Procurement March 2007 Community Based Pilot Projects Implementation June 2007 Mid Term Review December 2007 Project Completion December 2009

5.3 PROCUREMENT ARRANGEMENTS

5.3.1 Procurement arrangements are summarized in Table 5.2 below. All procurement of goods, works and acquisition of consulting services financed by the Bank will be in accordance with the Bank's Rules of Procedure for Procurement of Goods and Works and/or, as appropriate, Rules of Procedure for the Use of Consultants, using the relevant Bank Standard Bidding Documents.

Goods

5.3.2 The contracts for Hydrometric Equipment and Digital Maps, Satellite Images & Accessories will be awarded through International Shopping procedures because the items are produced by only a few international suppliers. There will be two contracts awarded through this procedure; one contract for the Hydrometric Equipment (UA 0.66 million) and one for the Digital Maps, Satellite Images & Accessories (UA 0.13 million). Motor Vehicles & Motor Cycles and Computing & Office Equipment will be procured through National Shopping procedures. Four contracts will be awarded for Motor Vehicles and Motor Cycles (UA 0.29 million) and four contracts for Computing & Office Equipment (UA 0.23 million).

Civil Works

5.3.3 The contract for groundwater Observation Wells (UA 0.16 million) will be awarded through NCB procedures. Three contracts will be awarded, one for each country. Contracts under the Community Basin Development component (UA 2.68 million) will be awarded in conformity with the Bank’s Guidelines for Community-Based Investment Projects. About twenty contracts are expected, each not exceeding UA 0.14 million . The installation of gauges is non-Bank funded and will be funded by the PIA’s through the national contributions .

Services

5.3.4 Procurement of the consulting services under the project will be through Short listing in accordance with the Bank's "Rules of Procedure for the Use of Consultants". For the River Basin Strategy and Monograph Development (UA 3.75 million) three contracts will be awarded, one for each River Basin. One contract will be awarded for Audit Services (UA 0.16 million to cover the four-year period of project implementation. For Project Management Technical Assistance (UA 0.94 million) eight individual contracts will be awarded, three for the PCO TAs and one for each of the five PIA TAs.

5.3.5 The services for Stakeholder Workshops (UA 0.09 million) and Training (UA 0.24 million) will be procured using SADC procedures on the basis of annual programs approved by the Fund. The SADC procedures have been reviewed and found to be acceptable for purposes of procuring these services.

Table 5.2 Procurement Arrangements

(UA Million) National Competitive International National Bidding Shortlisting Shopping Shopping Other N.B.F. Total

A. Goods 1. Vehicles - - - 0.29 - - 0.29 (0.29) (0.29) 2. Digital Maps, Satellite Images, etc - - 0.13 - - - 0.13 (0.13) (0.13) 3. Computing and Office Equipment - - - 0.23 - - 0.23 (0.23) (0.23) 4. Hydromet Equipment - - 0.66 - - - 0.66 (0.66) (0.66) B. Works 1. Installation of Gauges - - - - - 0.10 0.10

2. Groundwater Observation Wells 0.16 - - - - - 0.16 (0.14) (0.14) 3. Community Basin Development - - - - 2.68 - 2.68 (2.41) (2.41) C. Services 1. Monograph and Strategy Development - Buzi - 0.59 - - - - 0.59 (0.59) (0.59) 2. Stakeholder Workshops - Buzi - - - - 0.03 - 0.03 (0.03) (0.03) 3. Monograph and Strategy Development - Ruvuma - 1.58 - - - - 1.58 (1.58) (1.58) 4. Stakeholder Workshops - Ruvuma - - - - 0.03 - 0.03 (0.03) (0.03) 5. Monograph and Strategy Development - Save - 1.58 - - - - 1.58 (1.58) (1.58) 6. Stakeholder Workshops - Save - - - - 0.03 - 0.03 (0.03) (0.03) 7. Project Management TA - 0.94 - - - - 0.94 (0.94) (0.94) 8. Training - - - - 0.24 - 0.24 (0.24) (0.24) 9. Audit - 0.16 - - - - 0.16 (0.16) (0.16) D. Operating Expenses - - - - 0.97 - 0.97 (0.31) (0.31) Total 0.16 4.86 0.79 0.53 3.99 0.10 10.43 (0.14) (4.86) (0.79) (0.53) (3.06) - (9.38)

Note: Figures in parenthesis are the respective amounts financed by ADF

5.3.6 The following documents are subject to review and approval by the Bank before promulgation:

i) General Procurement Notice ii) Specific Procurement Notice iii) Tender Documents and Requests for Proposals from Consultants

iv) Tender Evaluation Reports and Reports of Evaluation of Consultants’ Proposals, including recommendations for Contract Award, and Draft Contracts.

5.4 DISBURSEMENT ARRANGEMENTS

5.4.1 The disbursement methods to be used for the project are (a) Direct Payments and (b) Special Account (SA). The direct payment method will be used for Consultancy Services, Hydrometric Equipment, Utility Vehicles, Motorcycles, and Computing & Office Equipment. The SA will be used to make payments related to Stakeholder Workshops, Training, Operating Expenses and Community Basin Management activities. Other disbursement methods may be used where appropriate in line with the provisions of the Bank’s Disbursement Handbook.

5.4.2 A SA will be opened by the Executing Agency (SADC Secretariat) where the initial advance and all replenishments will be made directly. The program of activities to be submitted to the Bank for replenishment of the SA will be a consolidation of the program of activities planned for the river basins. To facilitate operations on the ground, the PIAs will open foreign currency and local currency SAs where funds will be transferred from the SADC Secretariat SA for payments to contractors/consultants/suppliers.

5.4.3 The opening of the SADC Secretariat and PIAs Special Accounts will be a condition precedent to first disbursement of the grant.

5.5 MONITORING AND EVALUATION

5.5.1 The EA will assume primary responsibility for monitoring project implementation and fulfilling the Recipient’s reporting obligations to the Fund. Quarterly Progress Reports (QPRs) will be submitted to the Fund by the EA based on the compiled reports received from the PIAs. These reports shall cover all aspects of project implementation, including the status of progress against agreed implementation and disbursement schedules for all components; implementation of environmental and social mitigation measures. The QPRs shall also highlight issues affecting project implementation and propose corrective actions. Through the supervision missions and reviews of annual audit reports, the Fund will closely monitor the project implementation.

5.5.2 A Mid-Term Review (MTR) of the project will be held not later than 24 months after the commencement of implementation activities, which shall inform any adjustments to the project design to ensure that project objectives are achieved. The PCO and TA to each of the RBMIs shall be required to prepare and submit to the EA and the Fund, final reports at the completion of their assignments. After the completion of the project, the EAs will prepare and submit a Project Completion Report (PCR), which would serve as input in the preparation of the Bank’s own PCR.

5.5.3 SADC is developing monitoring and evaluation guidelines for RISDP and the Business Plans for short, medium and long term have been developed. The Secretariat and the RBMIs will ensure that the monitoring and evaluation system has aggregated indicators to monitor the overall development. The SADC Summit, Council and Integrated committee of Ministers will continue to provide an oversight using the annual progress report for SADC

Secretariat. Hence the progress reports generated by the project will be one of the important inputs into the SADC reporting and monitoring system

5.6 FINANCIAL REPORTING AND AUDITING

5.6.1 The PCO and the PIAs will maintain separate financial records for the project. The PCO Accountant will be responsible for designing an appropriate chart of accounts in collaboration will the PIA offices. This chart of accounts will allow the recording of project activities by the PCO and PIAs in a consistent manner so as to allow the necessary financial reporting on the project. Where necessary the PCO Accountant will train the accountants in the PIAs on how to use the chart of accounts.

5.6.2 Each year, the PCO accountant will prepare the project financial statements by consolidating the financial records of the PIAs. An external auditor to be recruited under the project will audit the project financial statements annually. Audit reports will be submitted to the Bank on an annual basis, within six months after the year-end in line with Bank rules. The budget for project audit has been included in the cost of the project.

5.7 DONOR COORDINATION

A number of donors were consulted during preparation and appraisal of the project including SDC, World Bank, EU, UNDP, the Netherlands and GTZ. It is envisaged that the Bank’s supervision missions will maintain these consultations during the implementation phase. Moreover, SADC will facilitate coordination activities with the donors in Gaborone and in the region. The projects will regularly be presented in the SADC Water Strategy Reference Group (WSRG), a meeting of donors active in the water sector as it provides a forum for donor coordination in the water sector. In addition through the soon to be revived annual consultative donor meetings under the auspices of the International Coordination Forum, the project progress and achievements will be shared as part of the implementation of the RISDP programme. Closer contact will be maintained with SDC, which is involved in the Ruvuma Basin.

6. PROJECT SUSTAINABILITY

6.1 RECURRENT COSTS

6.1.1 The recurrent costs associated with the project mainly relate to (1) costs of repairing and maintaining the hydrometric equipment, vehicles, computers and office equipment (3) incremental staff costs and (4) incremental office running costs. The incremental staff costs are not expected to be significant as the project will be utilising existing staff and only where specialized skills are deemed necessary will additional staff be recruited. The recurrent costs during project implementation are estimated at about UA0.24million per annum.

6.1.2 Approximately 50% of this estimate relates to office space and staff costs, both of which already exist. Another 25% relates to motor-vehicle/motor cycle expenses. Since motor vehicles/motor cycles under the project have been provided mainly to facilitate travel during implementation there will be little of this to be incurred after project completion. The incremental recurrent costs therefore represent approximately 25% of the estimated total recurrent costs, or USD0.06 million per annum. Roughly speaking this would amount to about UA 12,000 per PIA. For the PIAs that are already generating revenues (e.g. ZINWA-Save and ZINWA-Runde) these recurrent costs will be covered from revenues as is currently the case. For the other PIAs the 27

costs will be covered from the central budget allocations until they become financially self- sustaining.

6.2 PROJECT SUSTAINABILITY

6.2.1 The concerned Government institutions are expected to be able to cover the recurrent costs after completion of the Project under the general assumptions of the Project in the MPDE matrix and in Section 6.3. The experience from Save and Runde in Zimbabwe demonstrated that RBMIs can survive without to much reliance of full Government funding as user fee generated within the basin are adequate to sustain the offices meet is staffing requirements and a large part of its capital requirements. It is however apparent that for the offices for Save and Buzi in Mozambique and Ruvuma in Tanzania and Mozambique will require central Government funding until they can stand on their own.

6.2.2 The technologies used for the proposed project are well known in the three countries. The database and hydro-meteorological equipment provided can be maintained by the RBMIs. The capacity of the RBMIs will be strengthened through hands-on and academic staff training included in the project components.

6.3 CRITICAL RISKS AND MITIGATING MEASURES

6.3.1 The first risk associated with this project relates to the RBMIs. While the ARA Centro, ZINWA Save and ZINWA Runde offices are considered to have the capacity to be implementing agencies for the proposed activities in the Buzi and Save River Basins, the RBMIs for the Ruvuma River Basin are currently not fully developed. The Ruvuma Water Board in Tanzania has already been established but it does not as yet have all the necessary capacity to effectively handle all the activities related to the project on the Tanzania side. Similarly, ARA Norte in Mozambique has been legally established and the necessary staff appointed but the office is not yet operational.

6.3.2 The establishment of the Ruvuma Water Board are currently being addressed through an institutional support program from the Swiss Development Cooperation. In the interim period the Department of Water Resources of the Ministry of Water and Livestock Development will continue to provide the necessary back-up for the Ruvuma Water Board. The Government of Mozambique is also committed to making the ARA Norte Office functional as soon as possible. To mitigate the risk associated with the ARA Norte Office, it has been made a condition of first disbursement under the grant that this office is made fully functional. In the period running up to first disbursement, project-related activities on the Mozambique side will be coordinated by the National Directorate of Water (DNA) in the Ministry of Public Works and Housing. Some technical assistance for these offices, in terms of one TA and of computing and office equipment, is also being provided under the proposed project.

6.3.3 In addition, all the PIAs are benefiting from training under the project, which should address any human resource constraints that may affect the implementation of the project. On the potential risks associated with lack of financial resources, the Governments have confirmed there commitment for financially supporting those PIAs that are not financially self-sustaining until they can become financially independent.

6.3.4 The second critical risk relates to the multinational nature of the proposed project. The project spans three river basins and three countries with different administrative set ups, local languages, etc. While this could become an impediment during project implementation, the fact that the countries have signed the Protocol on Shared Watercourses and have agreed to jointly implement the project provides enough comfort that the implementation complexities can be overcome. There is already ongoing cross-border collaboration in the region under the umbrella of SADC (e.g. the Pungwe River Basin between Mozambique and Zimbabwe) and in other sectors. The country commitment to work together is further demonstrated by the existence of a JWC between Mozambique and Zimbabwe and the JWC being established between Tanzania and Mozambique. The SDC has committed funds to assist in the establishment of the Joint Water Commission between Mozambique and Tanzania for the Ruvuma River Basin. The potential risk to the project of a delay in the establishment of the Mozambique/Tanzania JWC has been mitigated by including it as a condition for first disbursement of the grant.

7. PROJECT BENEFITS

7.1 ECONOMIC BENEFITS

7.1.1 At the sub regional and national level, project benefits will arise from optimal use of water resources by institutionalizing IWRM. A strengthened SADC secretariat and institutionalized RBMIs provided with the necessary tools will be able to effectively coordinate water resource management among different line agencies. Efficient operation of the river basin organizations will provide additional water for the competing demands of water supply, irrigation and mini hydropower, mitigate floods, and improve water conservation. Other benefits will stem from the efficient use of water in agriculture, leading to increased productivity and household incomes. Adoption of improved land-use practices will improve water quality in the long run

7.1.2 At the grassroots, subprojects will target poor communities in the basin and greatly benefit affected groups and women. Through crop improvement, livestock and fishery management, and restoration of forestry household incomes will increase significantly while maintaining sustainable livelihood systems and the environment. These benefits will ensure food security and provide cash income for better education and health services. Provision of alternative livelihood opportunities will ensure that forest degradation is stabilized and shifting cultivation will be reduced, so that land-use patterns optimize water conservation.

7.1.3 The institutional strengthening of water resource management will bring a number of other benefits arising from the conservation of scarce water resources. The financial and technical assistance will support the policy objective of safeguarding investments in water resources development and other sectors of the economy by providing water rights and entitlements.

7.1.4 Developing a comprehensive, river basin-oriented approach will ensure a healthy environment and sustainable use of both surface water and groundwater resources. The experience from Zimbabwe shows that RBMIs can be autonomous from central government for operation and maintenance budgets, because the organizations are capable to generate enough revenues from water use permits which are manageable and affordable to water users in the basins.

7.2 THE SOCIAL IMPACT

7.2.1 The long-term social impact will be significant. Most issues in water use are ultimately social. Conflicts in water use are primarily conflicts between the use of water by one group of people and the use of water by another (or even the demand for different uses by the same group). The conflicts may be manifested in the need for domestic water versus the need for irrigation; the need for watershed protection versus the need for upland dwellers to grow food crops and make a living; and the need for sewage disposal versus the need for fresh drinking water. Planning water use thus entails, to a large extent, the resolution of conflicting or competing uses of a limited resource among social groups. Having a mechanism to do that (JWC, and river basin committees) ensures that, to the extent possible, each social group will be able, through a consultative process, to obtain maximum access to water in a way that is consistent with the overall social good.

7.2.2 In the long term, the Project will have a distinctly positive environmental impact. The main long-term intent of the Project is to provide SADC and the three Governments with the capacity to effectively manage the country's water resources. This means that in planning future use of water resources, environmental considerations will be fully taken into consideration. More specifically, during river basin planning all uses and requirements for water will be taken into account and special allocations can be made for such purposes as fisheries or wildlife and to protect unique environmental areas such as wetlands. Furthermore, by taking an integrated and holistic approach to planning, it will be possible to ensure the sitting of potentially polluting industries in areas where they will do the least amount of environmental damage and to identify where specific mitigation measures are required.

7.2.3 The existence of functioning JWCs, along with a mechanism to allow consultation in water allocation, will provide the poorer segments of society with the forum needed to enunciate their water resource needs and to ensure that, to some extent, these needs are met. In real terms, both the rural and the urban poor will have a voice in determining their access to a resource essential to their physical and economic well being and advancement. The project will integrate gender and HIV and AIDS in its implementation within the Community Basin Management component. Guidelines for integration of HIV and AIDS in Water sector are planned for adoption and implementation by 2005/6.

8. CONCLUSIONS AND RECOMMENDATIONS

8.1 CONCLUSIONS

8.1.1 The proposed Shared Watercourses Support Project complies with the SADC priorities as presented in the RISDP and RSAP-IWRMD. It is also consistent with the short, medium and long-term business and strategic action plans of the region. It will help to build regional and national capacities for sustainable management of water resources.

8.1.2 The project is in line with Bank policies on Regional Integration and Economic Cooperation and on Integrated Water Resources Management. The Bank’s contribution will encourage and support the joint efforts of the SADC riparian countries in developing strategies for integrated management and development of shared watercourses. The results of the monograph and strategy development would lead to bankable projects.

8.2 RECOMMENDATIONS

In view of the foregoing, it is recommended that a grant not exceeding UA 9.38 million be extended to the SADC, subject to the fulfilment of the following conditions:

Grant Conditions:

A. Conditions Precedent to Entry into Force

The Protocol of Agreement shall enter into force upon its signature by the Recipient and the Fund; B. Conditions Precedent to First Disbursement of the Grant

The obligations of the Fund to make the first disbursement shall be conditional upon the fulfilment by the Recipient of the following conditions:

The Recipient shall have, to the satisfaction of the Fund:

(i) Provided evidence that the Northern Region Water Administration (ARA Norte) Office is established and provided with offices and key staff (para 5.1.4)

(v) Provided evidence that the SADC Secretariat has opened, in a bank acceptable to the Fund, a foreign currency Special Account into which the proceeds of the grant shall be deposited (para 5.4.3);

(vii) The Bank in which the Special Account are lodged should have provided an irrevocable undertaking which is acceptable to the Fund that:

ANNEX 1

Map of Project Area

Ruvuma Basin

Buzi Basin

Save Basin

Source: SADC HYCOS (web-site) Project

ANNEX 2 SADC SECRETARIAT – ORGANIGRAM

Source: SADC Secretariat

ANNEX 3 Joint Water Commissions or Equivalent Name Member Countries Affected River Description Basins Tripartite Permanent Technical South Africa (RSA), Mozambique, Incomati, Maputo, Tripartite Interim Agreement of Aug 2002 between Mozambique, South Commission (TPTC) - Estab 1983 Swaziland Umbeluzi Rivers Africa and Swaziland for the protection and sustainable utilisation of the water resources of the Incomati Umbeluzi and Maputo Rivers. Joint Water Commission (JWC) Mozambique, Swaziland Umbeluzi Focus on water resources of common interest on the Umbeluzi River. Joint Water Commission (JWC) RSA, Swaziland Nkomati, Maputo Umbeluzi Rivers Komati Basin Water Authority (KOBWA)RSA, Swaziland Incomati The Komati River Basin Authority (KOBWA) estab 1992 by a treaty - Estab 1992 between South Africa and Swaziland on the water resources of the Komati river basin. Joint Permanent Technical CommissionBotswana, RSA Limpopo The Joint Permanent Technical Commission (JPTC) between Botswana (JPTC) and South Africa on the Limpopo, Molopo and Nossob Rivers (1987). Limpopo Basin Permanent Botswana, Moz, RSA, Zim Limpopo Advises on trans-boundary issues, management and utilisation of the Technical Committee (LBPTC) Estab Limpopo water. Became dormant in the mid-1990s. Efforts underway to 1986 revive it through a joint study on the hydrology of the Limpopo River. Limpopo Watercourse CommissionBotswana, Moz, RSA, Zim Limpopo Treaty to establish the Limpopo Watercourse Commission (2004) (LIMCOM) – Est 2004 OKACOM (Okavango River WaterAngola, Namibia, Botswana Okavango Aim to conduct an environmental assessment in the basin for aide Commission) - Estab 1994 develop an integrated management plan Zambezi Watercourse CommissionAngola, Botswana, Malawi, Zambezi The aims at promoting equitable and reasonable utilization and (ZAMCOM) - Estab 2004 Mozambique, Namibia, Tanzania, development of the water resources of the Zambezi Watercourse on a Zambia and Zimbabwe sustainable basis. Zambezi River Authority (ZRA) - EstabZambia, Zimbabwe Zambezi Aim to manage the Kariba dam complex. Undertakes water resources 1987 monitoring activities beyond the common border, Joint water commission (JWC) Mozambique, Zimbabwe Buzi, Save & Pungwe Mozambique and Zimbabwe formed a Joint Water Commission in Dec 2002to handle shared watercourses. Lake Tanganyika convention Tanzania, DRC Sub-catchment of No formal institution yet A management framework is being formulated. Congo Only institution currently proposed for the Congo area.

Joint Technical Commission & JointAngola, Namibia Cunene Aim to manage the existing hydropower and water supply infrastructure Operating Authority and investigate the feasibility of future developments.

Cuvelai Basin Commission (Proposed) Angola, Namibia Cuvelai Namibia and Angola are engaged in negotiations to establish a new commission for the Cuvelai Basin.

Joint Water Commission (JWC) - EstabBotswana, Namibia Kwando-Linyanti-Chobe Concentrates on the Kwando-Linyanti-Chobe river system, -a border 1990 river system between the Caprivi Region in Namibia and Botswana. and a tributary of the Zambezi River.

Nile Basin initiative Tanzania, DRC (only SADC Nile Facilitated by World Bank and other agencies. Focused on joint projects countries) bringing mutual benefits.

Lesotho Highland Water Commission RSA, Lesotho Lesotho Highlands Water Commission, the Lesotho Highlands Development Authority (LHDA) in Lesotho, the Trans-Caledonian Tunnel Authority (TCTA) in South Africa. Lesotho-South African WorkingLesotho, RSA Caledon river Lesotho lowland Committee Permanent Water Commission (PWC) -RSA, Namibia Lower orange To negotiation the allocation of water from the Orange River to Namibia Estab 1992 and a study to improve the management of the lower Orange. Joint Irrigation Authority - Estab 1992 RSA, Namibia Lower orange The agreement on the establishment of the Vioolsdrift and Noordoewer Joint Irrigation Scheme on the lower Orange River (1992): a Joint Irrigation Authority was created to operate the irrigation scheme straddling the river along the border. Orange-Senqu River CommissionBotswana, Lesotho, Namibia, RSA Orange The Commission is to develop a basin management plan, execute an (ORASECOM) - Estab 2000 environmental assessment, produce a study on the Molopo-Nossob river system and the establishment of a Secretariat for the Commission.

River Basin Water commission Mozambique & Zimbabwe Save & Pungwe Commission operational

Additional comments: Congo: Commission Internationale du Basin Congo-Oubangui-Sangha (CICOS); Cuvelai: proposals for formal arrangements have been made; Lake Chilwa: no arrangements, although arrangements may be needed; Lake Malawi: MOU signed by Tanzania and Mozambique. Malawi yet to sign; Limpopo: too many arrangements point to a need to simplify; Mohokare- Caledon: no formal mechanism for joint co-operation exists; Ruvuma: Tanzania and Mozambique negotiating an MOU for bilateral Water Commission. Adapted from GTZ-SADC, 2003 and updated by SADC in 2005 .

ANNEX 4

RSAP Strategic Objectives

Strategic Objective 1: Improve the Legal and Regulatory Framework at the National and Regional Level 1.1 Harmonize water laws 1.2 Set standards for drinking water 1.3 Develop water quality standards 1.4 Enforce standards 1.5 Provide framework for adequate dispute settlement mechanisms 1.6 Create equitable use of shared waters through river basin commissions

Strategic Objective 2: Improve National and Trans-boundary River Basin Management, Planning and Co-ordination 2.1 Improve capabilities of national water authorities 2.2 Improve regional cooperation in river basin management 2.3 Develop equitable use of shared waters through river basin commissions 2.4 Establish better intersectoral planning and coordination of water sector in each country 2.5 Strengthen SADC Water Sector Coordination Units

Strategic Objective 3: Strengthen Linkages between Macro-economic, Social and Environmental Policies 3.1 Shift water use to most efficient use based on economic values 3.2 Establish cost recovery mechanisms 3.3 Balance water resource demand and supply 3.4 Conserve water resources

Strategic Objective 4: Improve Information Acquisition, Management, and Dissemination 4.1 Monitoring programs 4.2 Assessment methods 4.3 Information access and exchange 4.4 Regional hydro-meteorological data banks 4.5 Interdisciplinary knowledge 4.6 Research for new initiatives

Strategic Objective 5: Support Awareness Building, Education and Training 5.1 Share knowledge about water resources 5.2 Identify best management practices 5.3 Support regional and national centers of excellence 5.4 Expand educational programmes 5.5 Demonstrate effective technical co-operation 5.6 Develop training courses on water resource management

Strategic Objective 6: Promote Public Participation 6.1 Identify stakeholders and secure stakeholder contributions 6.2 Ensure full and effective stakeholder participation. 6.3 Promote stockholder’s participation 6.4 Establish community-based water management groups 6.5 Adopt positive policies to address needs of women and the disadvantaged

Strategic Objective 7: Invest in Infrastructure 7.1 Expand infrastructure development and rehabilitation 7.2 Meet demands of multiple users 7.3 Ensure efficient use of water resources 7.4 Plan and implement works in a holistic manner 7.5 Balance social and environmental concerns with infrastructure goals

ANNEX 5 LIST OF RSAP PROJECTS SECTOR & PROJECT PARTICIPANTS RISDP TARGET Legal/Regulatory 1. Regional Water Resources Planning All SADC Countries Water sector policies & legislation harmonized by 2006 and Management • Consolidation and Expansion of SADC HYCOS • Standards Assessment of Surface Water Resources • Groundwater Management Programme for SADC • Support for Strategic ad Integrated Water resources Planning • Dam Safety, Synchronisation and Emergency Operations 2. Infrastructure Development Support All SADC Countries Increased awareness, broad participation and gender • Regional Strategic Water mainstreamed in water resources development and Infrastructure Programme management by 2005 • Strategic Infrastructure to Halve by 2015 the proportion of people without access to support agriculture, food security safe drinking water and sanitation services and rural livelihoods including poverty alleviation and attainment of MDGs • Strategic infrastructure to support main urban centres and industry • Cross border supply schemes – small border towns/villages • Programme on implementation of Water supply and sanitation in SADC 3. Water governance All SADC Countries Establish and strengthen at least eight River Basin • Implementation Programme for Organizations by 2006 SADC Protocol on Shared Water courses • Promotion of Public Participation in water resources development and management • Promotion of Implementation of Regional Water Policy and Strategy • Economic Accounting of Water Use • Study for Expanding Private Sector Participation in Water and Sanitation Services 4. Capacity Building All SADC Countries Water data banks and planning networks are established and • Skills Training for policymakers fully operational by 2007 Manger and Practitioners Training and institutional capacity strengthening programmes • Water net developed and implemented by 2008 • Capacity building support to the SADC Water Division • Strengthening River Basin Organisation • Regional Water Research Fund

ANNEX 6

LIST OF ON GOING BANK GROUP FINANCED PROJECTS FOR SADC Amount Year Projects Status (UA million) Projects approved 2000 Technical Assistance to SATCC 1.58 Ongoing Capacity Building for Rehabilitation (Malawi, Zambia and 2000 Zimbabwe) 0.328 Ongoing 2002 Support to SADC Agricultural Research 1.033 Ongoing

Funding Status of RSAP ANNEX 7 Funding Project title Funds in other Exchange Funds in Document Agency Currencies Rate US$ Status Netherlands Consolidation and expansion of SADC-HYCOS 0 2,490,000 Ag.in place Netherlands WaterNet Euro 2,400,000 1.22 2,916,000 Ag.in place Netherlands Incomati River Basin 0 200,000 Ag.in place Total 1.22 5,606,000 EU Consolidation and expansion of SADC-HYCOS - EPRD Euro 1,380,000 1.22 1,683,600 Ag.in place EU Capacity Building Support to the SADC Water Division - EPRD Euro 1,890,000 1.22 2,305,800 Ag.in place EU Maputo Basin Study - EPRD Euro 1,900,000 1.22 2,318,000 Ag.in place EU Orange/Senqu River Basin - EPRD Euro 2,120,000 1.22 2,586,400 Ag.in place EU Orange/Senqu River Basin - EU African partnership for Water Affairs Euro 2,000,000 1.22 2,440,000 Doc.in place Total 11,333,800 SIDA Groundwater Management Programme in SADC (through World Bank) 0 500,000 Ag.in place SIDA WATERNET (Phase II) SEK 25,000,000 7.50 3,333,333 Ag.in place SIDA Okavango River Basin (ERP) SEK 13,000,000 7.50 1,733,333 Ag.in place SIDA Pungue River Basin SEK 34,700,000 7.50 4,626,667 Ag.in place SIDA Regional Water Reseach Fund (WARFSA Phase II) SEK 17,000,000 7.50 2,266,667 Ag.in place SIDA WARFSA III SEK 30,000,000 7.50 4,000,000 Com. in place SIDA,DANIDA, NORAD ZACRPO 6.2/ZACPLAN 0.00 3,689,000 Com. in place Total 20,149,000 France Groundwater Management Programme in SADC 80,000 Ag.in place France Capacity Building Support to the SADC Water Division 144,000 Ag.in place FGEF Orange/Senqu River Basin Euro 1,500,000 1.22 1,830,000 Doc.in place Total 2,054,000 Belgium Support of Strategic and Integrated Water Resources Planning Euro 60,000 1.22 73,200 Doc.in place Promotion of the Implementation of Regional Water Policy and Strategy Euro 100,000 1.22 121,500 Doc.in place Skills training for water policymakers, managers and practitioners Euro 60,000 1.22 73,200 Doc.in place Total 267,900 World Bank/ Groundwater Management Programme in SADC 7,000,000 Ag.in place GEF Total 7,000,000 KfW Regional Strategic Water Infrastructure Programme Euro 8,300,000 1.22 10,126,000 Ag.in place INWENT Promotion of the Implementation of Regional Water Policy and Strategy Euro 327,000 1.22 398,940 Ag.in place GTZ Implementation Programme for SADC Protocol on Shared Watercourses (HarmonizatEuro 2,500,000 1.22 3,050,000 Ag.in place GTZ Transboundary Water Resources Management: Limpopo/Orange Sequ River Basin S Euro 2,000,000 1.22 2,440,000 Ag.in place GTZ Regional Strategic Water Infrastructure Programme Euro 500,000 1.22 610,000 Ag.in place Total 16,624,940 Denmark,SIDA Research and Consultancy Fund DKK 10,590,000 6.31 1,677,829 Ag.in place Denmark,SIDA Awareness Creation (GWP-SA) DKK 7,350,000 6.31 1,164,817 Ag.in place Denmark Local Grant Facility for IWRM DKK 21,060,000 6.31 3,337,564 Ag.in place Total 6,180,210 Ag.in place UNDP Capacity Building Support to the SADC Water Division 600,000 Ag.in place UNDP/GEF Okavango River Basin Study 5,000,000 Ag.in place Total 5,600,000 Ag.in place Switzerland Capacity Building Support to the SADC Water Division 360,000 Ag.in place Switzerland Joint Umbeluzi River Basin Study 300,000 Ag.in place Switzerland Joint Water Commission for the Rovuma/Ruvuma River Basin 200,000 Ag.in place Total 860,000 US State Dept. Zambesi River Basin: Lake Malawi/Shire River Control of Aquatic Weeds 200,000 Com. in place USAID Okavango River Basin- IWRM 6,000,000 Total 6,200,000 AfDB Buzi, Rovuma and Save Transboundary Water Resources Management Initiative 12,000,000 Doc.in place Total 12,000,000 Finland Cunene-Cuvelai River Basins Initiative Euro 2,700,000 1.22 3,249,000 Ag.in place Total 3,249,000 Ag.in place RSA-WRC Standard assessment of surface water resources Rand 950,000 6.79 139,912 Doc.in place RSA Implementation of the Water Supply and sanitation Programme for SADC Rand 583,000.00 6.79 117,647 Doc.in place RSA-DWAF Promotion of public participation in water resource development and management Rand 980,000.00 6.79 132,353 Doc.in place RSA Skills training for water policymakers, managers and practitioners Rand 610,000.00 6.79 264,000 Doc.in place Total 0.00 653,912 GRAND TOTAL 97,778,762 Doc= Document Exchange rate: US$ Equivalent Pound 1.76 SEK 7.5 Ag= Agreement DKK 6.31 DM 1.7 Com= Communication Euro 1.22 ZAR 6.79

ANNEX 8 Water, Poverty & Millennium Development Goals

Millennium Goals How water management contributes to achieving goals Directly contributes Indirectly contributes Poverty: to halve by 2015 the proportion of the world’s people • Water as a factor of production in agriculture, industry and other • Reduced vulnerability to water-related hazards reduces risks in investments and production whose income is less than $1/day types of economic activity • Reduced ecosystems degradation boosts local-level sustainable development • Investments in water infrastructure and services act as a catalyst for • Improved health from better quality water increases productive capacities local and regional development Hunger: to halve by 2015 the proportion of the world’s people • Water as a direct input into irrigation, including supplementary • Ensure ecosystems integrity to maintain water flows to food production who suffer from hunger irrigation, for expanded grain production • Reduced urban hunger by cheaper food grains from more reliable water supplies • Reliable water for subsistence agriculture, home gardens, livestock, tree crops • Sustainable production of fish, tree crops and other foods gathered in common property resources

Universal to ensure that, by 2015, children everywhere will be able • Improved school attendance from improved health and reduced water-carrying burdens, primary to complete a full course of primary schooling especially for girls education: Gender progress towards gender equality and the empowerment • Community-based organizations for water management improve social capital of women equality: of women should be demonstrated by ensuring that girls • Reduced time and health burdens from improved water services lead to more balanced and boys have equal access to primary and secondary gender roles education Child to reduce by two thirds, between 1990 and 2015, the • Improved quantities and quality of domestic water and sanitation • Improved nutrition and food security reduces susceptibility to diseases mortality: death rate for children under the age of five years reduce main morbidity and mortality factor for young children Maternal to reduce by three quarters, between 1990 and 2015, • Improved health and reduced labour burdens from water portage • Improved health and nutrition reduce susceptibility to anaemia and other conditions that mortality: the rate of maternal mortality reduce mortality risks affect maternal mortality Major to halve, by 2015, halt and begin to reverse the spread • Better water management reduces mosquito habitats and malaria • Improved health and nutrition reduce susceptibility to HIV/AIDS and other major diseases diseases: of HIV/AIDS, the scourge of malaria, the scourge of incidence other major diseases that affect humanity • Reduced incidence of range of diseases where poor water management is a vector

Environmental to stop the unsustainable exploitation of natural • Improved water management, including pollution control and • Development of integrated management within river basins creates conditions where sustainability: resources and to halve, by 2015, the proportion of sustainable levels of abstraction, are key factors in maintaining sustainable ecosystems management is possible and upstream-downstream impacts are people who are unable to reach or to afford safe ecosystems integrity mitigated drinking water • Actions to ensure access to adequate and safe water for poor and poorly serviced communities

This table shows that improving water management can make a significant contribution to achieving all of the Millennium Development Goals established by the UN General Assembly Millennium meeting in 2000. Source: Soussan, 2002.

ANNEX 9 COUNTRY INSTITUTIONAL ARRANGEMENTS A) Mozambique Water Sector

Council of Ministers

National Water Council

Ministry of Public Works & Housing Provincial Governments ARA – Centro Norte North-central Province Regional National Directorate of Water (DNA) Water Administration Provincial Directorate of Public National Director Works & Hous i ng ARA – Sul Southern Regional Water Water Departments Administration

ARA- Centro Central Regional Water Administration Consultative Council

ARA- Norte Northern Regional Water Technical Council Administration

Water & Sanitation Professional ARA- Zambeze Training Center Zambeze Regional Water Administration

DAF DHR DAU DAS GRI DAR DGRH GOH GPS Administration and Human Resources Urban Water Sanitation International Rural Water Wat er Resour ces Office of Office of Planning Finance Rivers Management Hydraulic and Control Infrastructure

B ZIMBABWE WATER SECTOR DEPT OF WATER RESOURCES

ZINWA CATCHMENT COUNCIL

CATCHMENT MANAGER SUB-CATCHMENT SAVE/RUNDE COUNCILS

WATER SUPPLIES MANAGER

PLANNING DATA AND GROUNDWATER WATER WATER ADMINISTRATION CATCHMENT SECTION RESEARCH SECTION SUPPLIES QUALITY H/R SECTION COORDINATOR SECTION SECTION SECTION

C TANZANIA WATER SECTOR

RUVUMA BASIN WATER BOARD

Basin Water Officer Member and Secretary to the Basin Water Board

Finance and Accounts

Education and Community awareness

Surface Water Groundwater Water Resources Regulatory Trans-boundary Water Hydrology (Hydrogeology) Planning and Research Enforcement and Resources Management Environment

Field Offices Sub-catchment Management Offices

ANNEX 10 Shared watercourses and interdependency in SADC countries

3 Shared watercourse (MAR in Mm ) Countries Key interdependency issues Buzi (6 600) Mozambique, Zimbabwe Hydropower, irrigation, afforestation.

Congo Angola, Burundi , Cameroon, Central African Republic, Hydropower, navigation. DRC, Gabon, Rwanda, Tanzania, Uganda, Zambia (1 260 000)

Cunene (5 500) Angola, Namibia Hydropower, abstractions.

Cuvelai(ephemeral) Angola, Namibia Fragile ecosystem, dependency of large local population on water for subsistence and irrigation.

Incomati Mozambique, South Africa, Swaziland Over-use (irrigation, afforestation, ecosystem requirements), international allocations, quality and flooding. (2 000)

Lake Malawi/Nyasa/Niassa Malawi, Mozambique, Tanzania Ecology of lake, fishing, flooding and sedimentation.

Lake Chilwa Malawi, Mozambique Ecology of lake, fishing.

Limpopo (4 100) Botswana, Mozambique, Over-use, allocations, ecosystems, urban use, industrial use, South Africa, Zimbabwe irrigation, afforestation, quality and flooding.

Maputo Mozambique, South Africa, Swaziland Flooding, eco-tourism, irrigation, industrial pollution. (1 800) Mohokare – Caledon (part of Orange) Lesotho, South Africa Water quality and quantity (including sediment loads).

Nile Burundi , DRC, Egypt, Eritrea, Ethiopia, Kenya, Tanzania and DRC are the only SADC countries in the Nile (86 000) Rwanda, Sudan, Tanzania, Uganda basin. Water quantity (allocations) and quality (siltation).

Okavango Angola, Botswana, Namibia Okavango Swamp’s ecosystem and competing ecotourism, (11 000) urban, irrigation and hydropower demands.

Orange – Senqu Botswana, Lesotho, Namibia, Export from Senqu in Lesotho to South Africa, quantity and (11 500) South Africa allocations in lower Orange River, estuary and ecosystem requirements.

Pungwe Mozambique, Zimbabwe Hydropower, irrigation, afforestation, urban use (Mutare and (3 200) Beira).

Ruvuma Malawi, Mozambique, Tanzania Irrigation and hydropower potential, but largely undeveloped. (15 000)

Save/Sabi Mozambique, Zimbabwe Irrigation abstractions, sediment loads and siltation resulting (6 800) in low (or no) flows in Mozambique.

Umbeluzi Mozambique, Swaziland Water allocations, Urban (Maputo and Mbabane) irrigation, (343) pollution, ecological flow requirements.

Zambezi (including Lake Kariba, Cahora Angola, Botswana, Malawi, Namibia, Mozambique, Hydropower, tourism, fishing, irrigation, water quality, Bassa Dam) Tanzania, Zambia and Zimbabwe flooding, wetlands protection and water allocation (including, (94 000) in future, withdrawals for distant urban areas).

Note: Mean annual runoff [MAR] figures are at mouth and are approximate.

ANNEX 11 COMMUNITY BASED PROJECTS SELECTION CRITERIA

1. Trans-boundary dimension 2. Benefits at a regional level 3. Tangible poverty reduction benefits 4. Able to upscale for the future 5. Sustainable use of water resources 6. Smart implementation arrangements and ownership 7. Implement M&E programme

Type of Projects:

1. Community based water supply 2. Environmental conservation 3. Training for small scale irrigation 4. Basin fish farming 5. Rehabilitation of hydromet and gauging stations 6. Small-holder irrigation development 7. Small dams for the provision of water 8. Rehabilitation of small water supplies 9. Training of communities in water supply management

ANNEX 12 Page 1 of 2 ENVIRONMENTAL AND SOCIAL MANAGEMENT PLAN SUMMARY

Project Title: SADC SHARED WATERSHED SUPPORT PROJECT

Project Number: P-Z1-EA0-003 Country: SADC (MOZAMBIQUE, TANZANIA, ZIMBABWE)

Department: ONIN Division: ONIN.2 a) Brief description of the project and key environmental and social components

The project is intended to promote adequate protection and rehabilitation of the environment for sustainable availability and use of water resources in the river basins of the rivers Ruvuma (Mozambique-Tanzania boarder), Buzi and Save (both shared by Mozambique and Zimbabwe

The project will consist of six components: (1) Institutional strengthening and capacity building, (B) Development of river basin monographs, (2) Enhanced knowledge and information support system, (3) River basin strategy development, (4) Early investment projects – this component is the only one with physical interventions; and (5) Project management and audit services. Project Management, institutional strengthening and capacity building – An effective river basin organization establishment is key to the success of the implementation of the SADC protocols on shared watercourses. This component will carry out and ensure the: a) Assessment of needs for capacity building; b) Development of strategy to address these needs; c) Development of guidelines and procedures/best practices for joint river basin planning, and d) institutional development and strengthening includes the PCU, the Ta to five PIAs, the overall management project support Development of river basin monographs and River basin strategy– This includes consolidation and updating of existing information, addressing of cross-cutting issues, generation of a common database for each of the three river basins, on-the-job training of staff, writing of river basin monographs, and stakeholders workshops. Project will develop river basin development scenarios, identify investment opportunities, on-the-job training, prepare and rank investment projects, pre-feasibility studies, and stakeholders’ workshops. Enhanced knowledge and information support system – This covers the establishment of a hydro-meteorological and groundwater gauging network, data processing and management, developing a Decision Support System, conduct training courses to share experience on methods of assessment of water methods with other SADC countries. Community Basin Management sub projects – Early in the project, community based sub projects will be identified that are within the framework of the project’s aims and objectives; capacity building will take place, and implementation of the identified community investment projects. Audit Services – This covers the annual audit of the project. b) Major environmental and social impacts

Watershed management involves the protection and restoration of the habitats and water resources incorporating the needs of multiple stakeholders. The project is intended to rehabilitate and conserve water resources and all contributing factors such as vegetation cover, reduction of soil erosion, introduction of best agricultural practices, etc. Many watershed lands are exposed to grazing by livestock and wild animals, harvesting of trees and shrubs for fuel and other wood products, agricultural cultivation, and other forms of human intervention. The harvesting of trees or shrubs in a sustainable manner can enhance water supplies. "Best management practices" have been established in the United States and a number of other countries as guidelines for watershed management practices that help to avoid environmental problems. Zimbabwe/Mozambique: Save & Buzi rivers: the key environmental issues confronting Save and Buzi basin today are: a) growing problems of resources overexploitation; b) land degradation due to human activities, natural phenomena, and widespread soil erosion and land degradation especial in the communal lands of Zimbabwe; sheet erosion is threatening many water bodies; c) continued loss of forests due to overexploitation; d) several floral and fauna species have become endangered; d) threat of alien species such as the water hyacinth in some of the country’s water bodies; e) water scarcity due to variability of rainfall and ineffective water management measures, including pricing and pollution control; f) atmospheric pollution due to industrialization and other factors; g) drought and climate change and h) pollution generated by large-scale farming that uses high quantities of pesticides and fertilizers than the small-scale communal and resettlement area farmers.

Tanzania/Mozambique: Ruvuma river: The year-to-year variation in rainfall is very high, and is reflected by the flow regime of the river closely following the rainfall pattern. Sediment transport in the basin varies from 2.5 m3/km2/year to 185 m3/km2/year. Floods normally occur in the flood plain of Ruvuma, where crops and other assets may be destroyed. Floods were the result of landslide and deterioration of vegetation cover. Shallow ground water resources are of good potential in the sediment areas; however, the resource is deep in the fractured and weathered zones. Groundwater recharge is high in the coastal sedimentary deposits while in the less permeable Mozambican belt; the recharge is mainly in the faulted and fissured zones. c) Enhancement and mitigation program

The project itself will not induce significant adverse impacts on the environment. It is intended to reverse adverse impacts of unsustainable current uses of natural resources in the river basins, including water resources. To reverse the trend and improve the river basins management, local communities, the key stakeholders in river basin management, will play a major role that entail changes in the way they exploit natural resources:

ANNEX 12 Page 2 of 2

Identification and use of Best practices (i) Search and facilitate diffusion of best practices and technologies linking with watershed management, particularly on reforestation and agro-forestry; (ii) Farmers adopt and practice techniques of fertilization such as composting with a variety of biomass available in the watershed; (iii) Apply the principle of utilization and diffusion of the project lessons learnt, applying management models to farmland with a variety of soil protection and restoration technologies, above all improved fallows with leguminous species management of biomasses; (iv) Agro- forestry technologies such as multiple use tree planting (fruits, fodder, poles, construction materials, etc.) or “living fences” with indigenous species that farmers would adopt without difficulty;(v) Plenty of fruit tree species can be introduced to the villagers with a view to backstopping their production activities and (vi) Production of indigenous tree seedlings at nurseries to insure sustainable supply of various multiple use tree seedlings. Training of local communities Equip committees to practice watershed management activities in a sustainable manner as well reinforcing their organizational, managerial, planning, and technical capabilities. Also supplying them with materials and equipment (tools for reforestation and land preparations, seeds, etc.). Develop capacity to make by-laws and their enforcement at the local level Organization of local communities and Identification and responsibility building of local leaders Farmers will be provided capacity to implement demonstration plots on agro-forestry technologies through their Sub-basing Management Committees; and Through Rapid Project appraisal techniques equip communities to develop Work Plan for the sub-basin management committees, including environmental and river-basin management activities including assessment of the vegetation cover, erosion, sources of erosion, silting, water and terrestrial weeds proliferations, etc. Initiate early sub-basin rehabilitation and conservation/protection activities and Ensure community participation in collection of Watershed information/data, including evolution of vegetation cover and erosion patterns/sources, source and non-point source pollution. d) Monitoring program and complementary initiatives

Monitoring will be reinforced to ensure that necessary information is gathered on river basin management, protection and planning at all levels; follow up of the proposed mitigation measures, and necessary improvements made on rehabilitation and conservation of the river basin; Production of technical manuals on forestry and agro-forestry; Elaboration of technical guidelines for prevention and control of bushfires, and Briefing the participating communities on the various findings, and exchanges of lessons and findings between watershed communities.

Key indicators of river basin monitoring are measurements of: vegetation cover, level of erosion at origin, silting in riverbeds and in reservoirs, river silt load, pollution loads, river flow, infiltration and rates of recharge of groundwater tables (where means are available for measuring this-a proxy is the monitoring of water table level), river discharge and its level of regulations (regular constant flows as opposed to flash floods), frequency of floods, etc e) Institutional arrangements and capacity building requirements

The institutional arrangements are the same as project implementation. At the SADC level, project will be coordinated and reporting consolidated and finalized, including environmental reporting. At the Watershed Management Office, all planning and design of training and capacity building materials and programming will be performed under the supervision of the Watershed Management Office. f) Public consultations and disclosure requirements Success of watershed management is highly dependent on involvement of local communities. g) Estimated costs Cost of environmental activities are not separable from the project cost, as the entire project aims at restoring satisfactory management practices in the river basins and improving the state of the environment so that water resources, and other resources as well, is properly managed, utilized and conserved. h) Implementation schedule and reporting The project itself does not have significant mitigation activities but enhancement measures imbedded in all project components ranging from studies and assessments, planning, training and early interventions. As such, implementation of project environmental aspects is fully blended with implementation of project components In 2002 study by SADC with the support of IUCN, SARDC, IBRD, IMERCSA, WB and SIDA titled “Defining and Mainstreaming Environmental Sustainability in Water Resources Management in Southern Africa” assessed all environmental issues related to water and watershed management, conservation and development in the SADC region. This study can be considered as a Strategic Environmental Impact Assessment (SEA), as it assesses all key environmental issues that may have considered in a SEA. Social issues are taken into account through the “institutional structures and processes”. The study includes: a conceptualization of water resources development and management for a sustainable balance, safeguarding the resource base, legal and institutional framework for mainstreaming the environment in the water sector, lessons recommendations and way forward. In addition, various important studies have also been undertaken in the three river basins.

Annex 13A Expenditure Accounts by Components - SADC (US$ Million) (UA Million) Shared Watercourses Support Project Project Project Expenditure Accounts by Components - Totals Including Contingencies Monograph Management Monograph Management and Community and and Community and Strategy Basin Capacity Strategy Basin Capacity I. Investment Costs Development EKIS Development Building Audit Total Development EKIS Development Building Audit Total A. Goods 1. Hydromet Equipment - 0.97 - - - 0.97 - 0.66 - - - 0.66 2. Digital Maps, Satellite Images, ets - 0.18 - - - 0.18 - 0.13 - - - 0.13 3. Computing and Office Equipment - 0.25 - 0.10 - 0.34 - 0.17 - 0.07 - 0.23 4. Vehicles - - - 0.43 - 0.43 - - - 0.29 - 0.29 Subtotal Goods - 1.40 - 0.53 - 1.93 - 0.96 - 0.36 - 1.32 B. Works Community Basin Management - - 3.92 - - 3.92 - - 2.68 - - 2.68 Groundwater Observation Wells - 0.23 - - - 0.23 - 0.16 - - - 0.16 Installation of Gauges - 0.15 - - - 0.15 - 0.10 - - - 0.10 Subtotal Works - 0.38 3.92 - - 4.30 - 0.26 2.68 - - 2.94 C. Services 1. Buzi Basin Monograph and Strategy Development Monograph Costs – Buzi 0.35 - - - - 0.35 0.24 - - - - 0.24 Monograph Workshops – Buzi 0.02 - - - - 0.02 0.02 - - - - 0.02 Strategy Costs – Buzi 0.52 - - - - 0.52 0.36 - - - - 0.36 Strategy Workshops – Buzi 0.02 - - - - 0.02 0.02 - - - - 0.02 Subtotal Buzi Basin Monograph and Strategy Development 0.91 - - - - 0.91 0.63 - - - - 0.63 2. Ruvuma Basin Monograph and Strategy Development Monograph Costs – Ruvuma 0.87 - - - - 0.87 0.60 - - - - 0.60 Monograph Workshops – Ruvuma 0.02 - - - - 0.02 0.02 - - - - 0.02 Strategy Costs – Ruvuma 1.44 - - - - 1.44 0.99 - - - - 0.99 Strategy Workshops – Ruvuma 0.02 - - - - 0.02 0.02 - - - - 0.02 Subtotal Ruvuma Basin Monograph and Strategy Development 2.35 - - - - 2.35 1.61 - - - - 1.61 3. Save Basin Monograph and Strategy Development Monograph Costs – Save 0.87 - - - - 0.87 0.60 - - - - 0.60 Monograph Workshops – Save 0.02 - - - - 0.02 0.02 - - - - 0.02 Strategy Costs – Save 1.44 - - - - 1.44 0.99 - - - - 0.99 Strategy Workshops – Save 0.02 - - - - 0.02 0.02 - - - - 0.02 Subtotal Save Basin Monograph and Strategy Development 2.35 - - - - 2.35 1.61 - - - - 1.61 4. Project Management Technical Assistance - - - 1.38 - 1.38 - - - 0.94 - 0.94 5. Training - - - 0.35 - 0.35 - - - 0.24 - 0.24 6. Audit - - - - 0.23 0.23 - - - - 0.16 0.16 Subtotal Services 5.62 - - 1.73 0.23 7.58 3.85 - - 1.18 0.16 5.19 Total Investment Costs 5.62 1.78 3.92 2.26 0.23 13.81 3.85 1.22 2.68 1.55 0.16 9.46 II. Recurrent Costs A. Office Space - - - 0.06 - 0.06 - - - 0.04 - 0.04 B. Communications - - - 0.06 - 0.06 - - - 0.04 - 0.04 C. Consumables - - - 0.07 - 0.07 - - - 0.05 - 0.05 D. Salaries and Wages - - - 0.70 - 0.70 - - - 0.48 - 0.48 E. Vehicle Running Costs - - - 0.35 - 0.35 - - - 0.24 - 0.24 F. Project Steering Committee - - - 0.09 - 0.09 - - - 0.06 - 0.06 G. Joint Water Commissions - - - 0.09 - 0.09 - - - 0.06 - 0.06 Total Recurrent Costs - - - 1.42 - 1.42 - - - 0.97 - 0.97 Total PROJECT COSTS 5.62 1.78 3.92 3.68 0.23 15.23 3.85 1.22 2.68 2.52 0.16 10.43 Foreign Exchange 5.62 1.40 1.57 2.65 0.21 11.45 3.85 0.96 1.07 1.81 0.14 7.84

Annex 13B Expenditure Accounts by Financiers SADC Shared Watercourses Support Project (US$ Million) (UA Million) Expenditure Accounts by Financiers Local Local SADC ADF Total For. (Excl. Duties & SADC ADF Total For. (Excl. Duties & Amount % Amount % Amount % Exch. Taxes) Taxes Amount % Amount % Amount % Exch. Taxes) Taxes

I. Investment Costs A. Goods 1. Hydromet Equipment - - 0.97 100.0 0.97 6.4 0.97 - - - - 0.66 100.0 0.66 6.4 0.66 - - 2. Digital Maps, Satellite Images, ets - - 0.18 100.0 0.18 1.2 0.18 - - - - 0.13 100.0 0.13 1.2 0.13 - - 3. Computing and Office Equipment - - 0.34 100.0 0.34 2.3 0.34 - - - - 0.23 100.0 0.23 2.3 0.23 - - 4. Vehicles - - 0.43 100.0 0.43 2.8 0.43 - - - - 0.29 100.0 0.29 2.8 0.29 - - Subtotal Goods - - 1.93 100.0 1.93 12.7 1.93 - - - - 1.32 100.0 1.32 12.7 1.32 - - B. Works Community Basin Management 0.39 10.0 3.52 90.0 3.92 25.7 1.57 2.35 - 0.2710.0 2.41 90.0 2.68 25.7 1.07 1.61 - Groundwater Observation Wells 0.02 10.0 0.21 90.0 0.23 1.5 - 0.23 - 0.02 10.0 0.14 90.0 0.16 1.5 - 0.16 - Installation of Gauges 0.15 100.0 - - 0.15 1.0 - 0.15 - 0.10 100.0 - - 0.10 1.0 - 0.10 - Subtotal Works 0.56 13.1 3.73 86.9 4.30 28.2 1.57 2.73 - 0.39 13.1 2.56 86.9 2.94 28.2 1.07 1.87 - C. Services 1. Buzi Basin Monograph and Strategy Development Monograph Costs - Buzi - - 0.35 100.0 0.35 2.3 0.35 - - - - 0.24 100.0 0.24 2.3 0.24 - - Monograph Workshops - Buzi - - 0.02 100.0 0.02 0.2 0.02 - - - - 0.02 100.0 0.02 0.2 0.02 - - Strategy Costs - Buzi - - 0.52 100.0 0.52 3.4 0.52 - - - - 0.36 100.0 0.36 3.4 0.36 - - Strategy Workshops - Buzi - - 0.02 100.0 0.02 0.2 0.02 - - - - 0.02 100.0 0.02 0.2 0.02 - - Subtotal Buzi Basin Monograph and Strategy Development - - 0.91 100.0 0.91 6.0 0.91 - - - - 0.63 100.0 0.63 6.0 0.63 - - 2. Ruvuma Basin Monograph and Strategy Development Monograph Costs - Ruvuma - - 0.87 100.0 0.87 5.7 0.87 - - - - 0.60 100.0 0.60 5.7 0.60 - - Monograph Workshops - Ruvuma - - 0.02 100.0 0.02 0.2 0.02 - - - - 0.02 100.0 0.02 0.2 0.02 - - Strategy Costs - Ruvuma - - 1.44 100.0 1.44 9.4 1.44 - - - - 0.99 100.0 0.99 9.4 0.99 - - Strategy Workshops - Ruvuma - - 0.02 100.0 0.02 0.2 0.02 - - - - 0.02 100.0 0.02 0.2 0.02 - - Subtotal Ruvuma Basin Monograph and Strategy Development - - 2.35 100.0 2.35 15.5 2.35 - - - - 1.61 100.0 1.61 15.5 1.61 - - 3. Save Basin Monograph and Strategy Development Monograph Costs - Save - - 0.87 100.0 0.87 5.7 0.87 - - - - 0.60 100.0 0.60 5.7 0.60 - - Monograph Workshops - Save - - 0.02 100.0 0.02 0.2 0.02 - - - - 0.02 100.0 0.02 0.2 0.02 - - Strategy Costs - Save - - 1.44 100.0 1.44 9.4 1.44 - - - - 0.99 100.0 0.99 9.4 0.99 - - Strategy Workshops - Save - - 0.02 100.0 0.02 0.2 0.02 - - - - 0.02 100.0 0.02 0.2 0.02 - - Subtotal Save Basin Monograph and Strategy Development - - 2.35 100.0 2.35 15.5 2.35 - - - - 1.61 100.0 1.61 15.5 1.61 - - 4. Project Management Technical Assistance - - 1.38 100.0 1.38 9.0 1.38 - - - - 0.94 100.0 0.94 9.0 0.94 - - 5. Training - - 0.35 100.0 0.35 2.3 0.35 - - - - 0.24 100.0 0.24 2.3 0.24 - - 6. Audit - - 0.23 100.0 0.23 1.5 0.21 0.02 - - - 0.16 100.0 0.16 1.5 0.14 0.02 - Subtotal Services - - 7.58 100.0 7.58 49.8 7.56 0.02 - - - 5.19 100.0 5.19 49.8 5.18 0.02 - Total Investment Costs 0.56 4.1 13.24 95.9 13.81 90.7 11.05 2.75 - 0.39 4.1 9.07 95.9 9.46 90.7 7.57 1.89 - II. Recurrent Costs A. Office Space 0.06 100.0 - - 0.06 0.4 - 0.06 - 0.04 100.0 - - 0.04 0.4 - 0.04 - B. Communications 0.03 50.0 0.03 50.0 0.06 0.4 - 0.06 - 0.02 50.0 0.02 50.0 0.04 0.4 - 0.04 - C. Consumables 0.04 50.0 0.04 50.0 0.07 0.5 - 0.07 - 0.02 50.0 0.02 50.0 0.05 0.5 - 0.05 - D. Salaries and Wages 0.70 100.0 - - 0.70 4.6 - 0.70 - 0.48 100.0 - - 0.48 4.6 - 0.48 - E. Vehicle Running Costs 0.07 20.0 0.28 80.0 0.35 2.3 0.28 0.07 - 0.05 20.0 0.19 80.0 0.24 2.3 0.19 0.05 - F. Project Steering Committee 0.04 40.0 0.06 60.0 0.09 0.6 0.06 0.04 - 0.03 40.0 0.04 60.0 0.06 0.6 0.04 0.03 - G. Joint Water Commissions 0.04 40.0 0.06 60.0 0.09 0.6 0.06 0.04 - 0.03 40.0 0.04 60.0 0.06 0.6 0.04 0.03 - Total Recurrent Costs 0.96 67.9 0.46 32.1 1.42 9.3 0.39 1.03 - 0.66 67.9 0.31 32.1 0.97 9.3 0.27 0.70 - Total PROJECT COSTS 1.53 10.0 13.70 90.0 15.23 100.0 11.45 3.78 - 1.05 10.0 9.38 90.0 10.43 100.0 7.84 2.59 -

ANNEX 14 Project Implementation Arrangements

SADC Water Division Project Coordination Office (PCO)

Joint Water Commission Joint Water Commission Tanzania/Mozambique Mozambique/Zimbabwe

Tanzania Steering Steering Zimbabwe Committee Committee WRD DWR (Moz./Zim.) .Moz/Tanz. Mozambique DNA Mozambique DNA

Buzi/Save PIAs Ruvuma PIAs

ARA Centro RBMI Ruvuma Water Board ZINWA Buzi RBMI ARA Norte ZINWA Save RBMI Stakeholder Stakeholder Representatives Representatives

WU WU WU Zimbabwe Mozambique Tanzania

Legend DNA – National Directorate of Water DWR –Department of Water Resources PIA – Project implementation Agency RBMI – River Basin Management Institution WDR –Water Resources Department WU – Water Users

Reporting Consultation

ANNEX 15

SADC: Shared Watercourses Support Project for Ruvuma, Buzi and Save River Basins

Chronology of Project Activities

Date Activity Key Agencies Met Mission Team July 2003 Project identification SADC Secretariat Water Engineer Public Utilities Economist Aug 2004 Project preparation SADC Secretariat Consultants DNA – Mozambique MWLD – Tanzania ZINWA – Zimbabwe Feb 2005 SADC Water Sector Reference SADC Secretariat Water Engineer Group Donors in water sector Public Utilities (EU, FAO, Netherlands, Economist SDC, SIDA, UNDP, Consultant UNEP) Feb 2005 Project preparation SADC Secretariat Water Engineer DNA – Mozambique Public Utilities EU, Netherlands, SDC, Economist UNDP Consultant Aug 2005 Project appraisal SADC Secretariat Water Engineer DNA ; MoPl. – Public Utilities Mozambique Economist MWLD; MoF – Tanzania Financial Analyst ZINWA; MoF – Environmentalist Zimbabwe Consultant

Annex

CORRIGENDUM MULTINATIONAL: SADC SHARED WATERCOURSES SUPPORT PROJECT FOR BUZI, RUVUMA AND SAVE RIVER BASINS)

The Map replaces the one in the report

ANNEX 1 Map of Project Area

Source .SADC Water Division Key: 1. Congo Basin ; 2. Zambezi Basin; 3. Okovango Basin; 4. Cunene Basin; 5. Cuveli Basin; 6. Nata Basin; 7. Orange-Senqu Basin; 8. Maputo-Usutu-Pongola Basin; 9. Umbeluzi Basin; 10. Incomati Basin; 11. Limpopo Basin; 12. Save Basin; 13. Buzi Basin; 14. Pungwe Basin;15. Ruvuma Basin