DRAFT E785 Public Disclosure Authorized

MOLDOVA SOIL CONSERVATION PROJECT

ENVIRONMENTAL ANALYSIS AND ENVIRONMENTAL MANAGEMENT PLAN Public Disclosure Authorized Public Disclosure Authorized

July 15, 2003 Public Disclosure Authorized

FILE COPY Abbreviations

BLS Baseline Studies CDM Clean Development Mechanism EIA Environmental Impact Assessment EMP Environmental Management Plan EPL Environmental Protection Law ER Emission Reduction ERPA Emissions Reductions Purchase Agreement HA Hectares ICAS Forest Management and Research Institute ISDS Integrated Safeguard Data Sheet MP Monitoring Plans NFA National Forest Agency NPV Net Present Value PCF Prototype Carbon Fund PCN Project Concept Note PDD Project Design Document PF Process Framework PID Project Information Document PIN Project Idea Note VR Validation Report CONTENTS

1. Project Description ..... 3...... 3 2. Status of Afforestation Lands ...... 6 3. Forest Operations ...... 6 3.1 Seedlings and trees protection measures...... 6 3.2 Maintenance works ...... 6 3.3 Forest Roads...... 7 4. National EIA Legal Framework .. 7 5. Forestry Legislation and Legal Provisions with Regard to Afforestation .. 10 6. Monitoring and Enforcement of Environmental and Forestry Legislation .. 13 7 Environmental Analysis: Without the Project . .15 7.1 Biodiversity Baseline Scenario (Without-Project).15 7.2 Soil Conservation Baseline Scenario (Without-Project).25 7.3 Other EnvironmentalIssues in the BaselineScenario (Without-Project) 26 8. Environmental Analysis: With the Project .. 28 8.1 Expected Project Contributionsto SustainableDevelopment 28 8.2 Biodiversity Impacts of the Project.36 8.3 Soil Conservation Effects of the Project.40 8.4 Other EnvironmentalEffects of the Project.41 8.5 Outlook on Project Contributionsto SustainableDevelopment 42 9 Project Alternatives .. 43 10 World Bank Safeguard Policies .. 44 11. Environmental Management Plan (EMP) ...... 46 11.1 EMPSummary...... 46 11.2 Monitoring...... 50 11.3 InstitutionalArrangements and CapacityBuilding ...... 54 12. Record of Consultations and Information Disclosure ...... 56 12.1 Consultationsand Information Disclosure in ...... 56 122 Consultationsand Information Disclosurein the World Bank and PCF. 57 12.3 Additional Planned Consultations and Disclosure...... 57

ii 1. Project Description

The development objective of the project is to promote sustainable soil conservation in and around degraded agricultural areas. In addition to improving soil quality and preventing further erosion, the project's afforestation activities will support global objectives of carbon sequestration and reduction of greenhouse gas concentrations. The project will conserve soils on 14,494 hectares of degraded pasturelands, by means of afforestation with tree and shrub species adapted to these adverse site conditions, providing urgently needed fuel wood and timber to rural people.

This Project fits in the general framework of global climate change mitigation, a growing area of activity for the World Bank Group. The Bank serves as Trustee of the Prototype Carbon Fund (PCF), which implement the Kyoto Protocol on climate change on an experimental basis. In establishing this Fund, the World Bank had three strategic objectives: (a) to demonstrate how project-based Emission Reductions transactions can promote and contribute to the sustainable development of developing countries and countries with economies in transition; (b) to share with the Parties to the UN Framework Convention on Climate Change knowledge gained by the Trustee and Participants in the course of the Fund's operations; and (c) to demonstrate how the Bank can work in partnership with the public and private sectors to mobilize new resources for its borrowing member countries while addressing global environmental concerns.

From the total project afforestation area of 14,494 ha, some 9,106 ha (63%) are property of Moldsilva or are being transferred from local communities to Moldsilva and 5,389 ha (37%) are owned by the local communities and which have contracted Moldsilva for a period of 5-10 years for executing the afforestation work on their behalf. The decisions of local councils have been taken and the contracts for the planting and maintenance activities have been concluded with Moldsilva. After the contract period forest management activities will be continued by the municipalities.

The project afforestation area of 14,494 ha consists of 1,891 plots distributed among 151 primarii (mayoralties, municipalities, local communities) and 22 forest districts (forest enterprises), in all 11 judets (provinces)' of the country. The average and median plot sizes are 7.7 and 4.5 hectares, respectively (range, 1.1 ha tol 15.6 ha). Table 1 summarizes the project sites according to area classes and Figure 1 illustrates the data graphically. Table 2 summarizes the geographic distribution of the project sites across the country and indicates whether ownership is with Moldsilva or local communities.

The judets were created by merging the former 50 raions (districts) that will be recreated in 2003.

3 Table 1. Size characteristics of the sites for afforestation: i Area class (ha) No. of plots Area (ha) Area (%) 1-4.9 1,009 2,596 18% 5-9.9 456 3,150 22% 10-14.9 189 2,271 16% 15-19.9 93 1,576 11% 20-29.9 77 1,845 13% 30-49.9 48 1,739 12% >50 19 1,317 9% Total 1,891 14,494 100%

Figure 1. Size distribution of sites selected for afforestation Distribution of afforestation plots

3500

3000- 0 number of sectors , _ |area (ha) 2500'1i

2000r/

1500 1 | i _

500 @ l =

14,9 5-9,9 10-14,9 15-19,9 20-29,9 3049,9 >50 Sector size class

4 Table 2. Distribution of Proj ct Sites by Zone and Forest Enterprise Forest Managers of Forests Enterprises Lands for Afforestation Forest Fund Under the Transfer (ha) State Forest Agency Process to SFA Local Councils I_MOLDSILVA MOLDSELVA Northern Zone Edinet 335.2 9.6 159.2 166.4 Glodeni 768.9 168.3 253.4 347.2 Balti 534.2 189.6 344.6 0 Soroca 562.3 78.4 277.5 206.4 $oldaneqti 68.8 31.0 10.2 27.6 Padurea 125.0 85.0 40.0 0 Domneasca Total 2394.4 561.9 1089.9 747.6 Central Zone Telene,ti 176.1 30.9 0 145.2 Orhei 625.3 351.3 106.1 167.9 Calara,i 177.3 13.2 53.4 110.7 Ungheni 775.7 376.2 105.8 293.7 Nisporeni 401.7 31.5 188.8 181.4 Stra,eni 330.1 32.1 298.0 0 Chi,inau 967.0 463.0 11.8 492.2 Hinceti 849.3 261.5 305.3 282.5 Rezeni 111.3 60.7 0 .50.6 Tighina 2139.0 933.3 727.2 478.5 RNS Codrii 12.0 0 0 12.0 RNS Plaiul 52.3 0 0 52.3 Fagului Total 6617.1 2553.7 1796.4 2267.0

Southern Zone largara 1337.3 570.3 375.7 391.7 2494.3 510.7 0 1983.6 Manta-V 315.2 211.0 104.2 0 Silva-Sud 1335.2 0 0 1335.2 Total 5482.4 2627.2 479.9 2375.3 Total general 14493.9 5742.8 3361.2 5389.9 % from the 100 39.6 23.2 37.2 project

Time Frame for Proiect Activities. The project planting started in October 2002 when 50% of the project areas were established. Planting will continue in 2003 (18% of

5 plantation), 2004 (13%), and 2005 (19%). The scheduled PCF Project Crediting Period will be for 15 years (2002-2017).

2. Status of Afforestation Lands

According to the cadastre inventory the lands intended to be included in project (originally 14,912.7 ha) are distributed in the following land use categories: * Pastures - 5578,0 ha; * Glades and places without vegetation - 4939 ha; * Abandoned arable lands - 195,5 ha; * Perennial plantations - 257,24 ha; * Degraded lands - 3943,0 ha. To facilitate the project review, these categories were combined to form two larger categories, based on erosion conditions, fertility and vegetative cover: * Pastures 10,713 ha, incl. pastures (5,578 ha), glades (4,939 ha), abandoned arable lands (195 ha) * Degraded lands 3943 ha, incl. landslides, ravines, other degraded lands Different forms of erosion are common on the project sites, including landslides, soil creep, tillage erosion and particle movements (through-wash, rainsplash, rainflow, rillwash, gully erosion. 35% of the project sites show moderate to excessive, mainly surface erosion (Error! Reference source not found.). About 27% of the project sites are classified as degraded lands that essentially have no productive potential due to the occurrence of ravines and landslides.

3. Forest Operations

This section contain a short description of the proposed forest operations.

3.1 Seedlings and trees protection measures

Generally the seedlings diseases protection measures will comprise the following:

* Supplementary treatment of seedlings with phosphorus and potassium. * Removal of infected seedlings and fallen leaves

Tree protection measures outside those mentioned above for seedlings will include also the creation of multi-species stands according to the forest vegetation conditions. There are no plans to use pesticides.

3.2 Maintenance works

All the interventions carried out in the framework of forest plantation from the canopy closure stage and up to the harvest are called maintenance cuttings. Through these

6 procedures, forest functions and phyto-sanitary conditions are improved, and the resistance of trees to harmful environmental factors is increased.

Maintenance cuttings are programmed and carried out according to the Technical guidelines on maintenance and management of forests in the forest fund (CACS, Chisinau, 1995). The maintenance work falls into the following categories:

* Thinning - 4,2 m3 /ha, including 4,2 m3 twigs, boughs, branches; * Thinning - 5,9 m 3 /ha, including 0,2 m3 of fuelwood and 5,7 m3 twigs, boughs, branches; * Thinning - 19,9 m3 /ha, including 2,1 m 3 timber, 15,6 m3 fuelwood and 2,2 m3 twigs, boughs, branches; * Hygienic cuttings - 16,4 m 3/ha, including 1,5 m 3timber, 13,8 m3 fuelwood and 1,1 m3 twigs, boughs, branches.

The periodicity of maintenance and management works is as follows:

* Thinning: with a periodicity of 2-3 years - maintenance activities for trees after the canopy closure, during which the suppressed mixture species are extracted * Thinning: with a periodicity of 3-5 years - maintenance activities that are carried out at more advanced age than the above mentioned activity, the aim of which is the relatively homogeneous placement of main and mixture species. * Thinning: with a periodicity of 5-8 (5-12) years - maintenance cuttings effectuated at more advanced ages, the aim of which is creation of conditions for the development of main species and intensification of growth.

3.3 Forest Roads

Road access to the project sites is satisfactory. The project will not involve road rehabilitation or construction.

4. National EIA Legal Framework

Since 1992, Moldovan authorities have developed a series of new laws and regulations which stipulate in detail all aspects of the EIA:

* Law on Environmental Protection (LEP) (1993) * Law on State Ecological Expertise (SEE) and Environmental Impact Assessment (EIA) (1996) * Guidelines on Performing State Environmental Expertise (1995) * Regulation on Joint Expert Committee of the Ministry of Environment (1998) * Regulation on Public Participation in Environmental Decision- Making(2000)

7 The existing EIA system in Moldova is based on the old soviet system of the State Ecological Expertise (SEE). The SEE represent a process of the review of proposed activities from the point of view of their correspondence to the national environmental laws, regulations and standards as well as of proposed mitigation measures. The SEE is a mandatory process not only for concrete development projects, but also for strategic documents, such as land use plans, sectoral strategies. In order to facilitate the SEE process, project documentation to be submitted to the expert committee should include an EIA report. This report should comprise the environmental effects of the proposed activities and the anticipated mitigation measures.

EIA administrative framework. The competent SEE authority in Moldova is the Division on SEE within the State Ecological Inspection, a subdivision of the Ministry of Ecology, Construction and Territorial Development. It incorporates dual functions. As the main administrative body, it is responsible for organizing and coordinating the SEE procedure (Law on SEE and EIA, Article 7(2)). As the expert body, it is responsible for reviewing project documentation for planned activities and deciding whether or not they may be implemented. In the latter function, the ministry is represented by a group of permanently employed state experts of the Division on SEE. The Division on SEE is also responsible for control and supervision of SEE procedures.

EIA guidelines and procedures. An annex to the Law on SEE and EIA contains regulations for conducting EIA studies. Procedures for conducting SEE are contained in Guidelines on Performing SEE (1995). The comprehensive guidelines define in detail the goal, objectives, and principles of SEE. They stipulate the structure and function of the process, procedures for submitting project documentation, and review procedures. The guidelines are accompanied by a series of annexes, on such topics as requirements for project documentation submitted to SEE (Annex 7. 1.); the subdivisions responsible for SEE of various types of projects (Annex 7.2.); requirements for every chapter, or volume, of project documentation (Annex 7.3); projects that require a separate chapter on EIA at the project stage (Annex 7.4).

Screening: methods and categories. The Law on SEE and EIA clearly indicates that the basic the screening method that should be applied should be a mandatory list of the activities what need to have a full EIA study, which is presented in the Annex to the ETA Regulation.

The initial stage of the SEE procedures is the preparation of project and planning documentation to be submitted to SEE for approval. Depending on the complexity and the expected environmental impact of the planned activity, an EIA study may or may not be required as a preliminary SEE procedure. The Law on SEE and EIA stipulates that all activities that could have a significant impact on the environment and affect it radically require such a preliminary EIA study. The mandatory list of developments that require EIA is provided in Chapter X of the Regulation on EIA annexed to the law. It considers 32 types of activities in total. According to Chapter T(4) of the same regulation, the central environmental authority may also require an EIA for activities that are not on the

8 list - even though the procedure for case-by-case screening is not elaborated in Moldovan environmental assessment legislation.. As was mentioned above afforestation is not included in this list.

Public participation. Public participation and consultation are recognized as valuable tools in environmental assessment for mediating differing interests, arriving at sound decisions, and ensuring the rights of citizens to have access to environmental information and a role in enviromnental decision-making. Efficient public participation and consultation in environmental decision-making consist of the following interconnected components:

* Identifying the interested public (groups, individuals) * Providing information to the public in a timely manner * Fostering communication/dialog between the decision-makers and interested parties * Incorporating the results of the dialog into decision-making Informing the public of the decision and how its views influenced the decision

All these aspects are present in Moldovan SEE legislation to one extent or another. Thus, the Regulation on Public Participation in Environmental Decision-Making determines the procedures for public participation in decision-making on new policies, programs, and plans, as.well as new laws and regulations (Chapter II), project-level economic activities (Chapter III), and national-level development activities (Chapter IV).

The public should have access to environmental information and should be consulted during the environmental decision-making process. It also has the right to carry out a public ecological expertise, or review, of any proposed activity and to relay its opinion/findings to the main administrative body of SEE. Requirements for public ecological reviews are stipulated in the Law on SEE and EIA - e.g., they may be carried out by environmental nongovernmental organizations that are officially registered and whose by-laws provide for public ecological review or by special-interest groups that list at least 100 signatories 18 years old or older.

Public participation and consultation is ensured by the proponent. This person or entity is responsible for informing the public in the target area about the planned development and for organizing public debates on the proposed activity and sending the results to SEE. The proponent is also responsible for informing the local public authority and providing it with project documentation and a summary of potential impacts and mitigation measures. The local public authority disseminates this information and ensures that the public has adequate opportunities to comment (Articles 13b; 14). It also informs the public about the final decision that is made on the proposed activity, by means of leaflets, press releases, radio and TV programs, as well as direct communications (Article 15). Local public authorities, together with local environment authorities, review the results of the poll and decide how the proponent should respond. The proponent then makes appropriate adjustments in project documentation to meet the requirements of legislation

9 and established norms and standards. If the proponent rejects the suggestions made by the public, he/she must present a written explanation to local public authority.

Public participation in environmental decision-making is considered terminated only when the decision-maker publishes the final resolution regarding the proposed national- level development project (Article 26).

Monitorin2, enforcement, and compliance. Laws related to SEE and EIA do not include any stipulations on monitoring of project implementation. Information on post- project analysis in Moldovan environmental assessment legislation is vague, is limited to monitoring environmental quality and to control, if the approved project is implemented according to a SEE resolution. Moreover, no detailed procedures for post-project analysis are given - ones that would clearly define its goals, principles, and implementation.

There is only one general provision in national legislation on enforcement and compliance of SEE and EIA requirements and conditions The Law on Amendments of the Penal Code, the Code of Penal Procedure, and the Code of Administrative Violations (1993) stipulates SEE violations and penalties. For example, implementation of development projects without a SEE, which entails a penalty of 10 times the minimum monthly wage for natural persons and 20 times for legal persons.

5. Forestry Legislation and Legal Provisions with Regard to Afforestation

The management of lands covered with forest vegetation is regulated by legal acts approved by the Parliament, technical norms and regulations approved by the Government, instructions and forestry recommendations approved by central forestry authority The main legislative acts with the attribution to the extension process of the territories covered with forest vegetation is the Forest Code (nr. 887 from June 21, 1996 with next modifications), the Land Code (nr.828 from December 25, 1991 with next modifications), the Law on the improvement of degraded lands through the afforestation (1041-XIV from June,15, 2000); Law on the environmental protection(1993); Law on the zones and forest protection belts for water basins, rivers (1994). Besides these laws, there are in force several other by laws and regulations and specifically:

* Technical guidelines on the regeneration and afforestation of lands from the state forest fund of the Republic of Moldova; * Technical guidelines on the maintenance of trees in the forest fund; * Instruction on the annual control of regenerated lands; * Technical norms on the forest protection.

Forest Code

The problems linked with the extension of the territories covered with forest vegetation are expressed in the chapters IX and X (art. 52; 54-55). According to the corresponding articles, the central forestry authority is obliged to assure the afforestation of all territories

10 from the forest fund subject for the regeneration (waste grounds and glades, degraded lands received for management, other territories). Composition, schemes and technologies for forest artificial refforestation are established according to the special technical norms, taking into consideration the type of forest vegetation conditions.

Afforestation of degraded lands outside the forest fund is obligatory and is effectuated by the landowners according to specific programs and projects, reviewed by the state forestry and environmental authorities and are approved by public local administration authorities. Financing of corresponding activities is made from the state and local budget.

According to Art.9 the control under the regeneration (afforestation) of the areas from the forest fund, registration the rights for management and use of these lands, participation in the implementation of programs for regeneration, afforestation of degraded lands are the competence of the authorities of the local public administration.

Art.6 foresees that forests of the Republic of Moldova used in public interest, present the object of public property, being transferred in management or use. Private property on forests is allowed in the case if these forests are planted in accordance with the legislation on the private lands.

Art. 84 and 85, annex 4 establish responsibility for destruction of forest plantations independently of the form of property. Thus, the destruction of 1 ha of forest plantations at the age up to 5 years, the quantity of damages constitute 43-53 of minimal salaries (in dependence on the functional group) and administrative penalty in the amount of 5-25 minimal salaries. In the case when damages caused to forest plantations in the age of 6- 10 years, penalty constitute 56-65 minimal salaries. In the case of plantations of Quercus, Fagus, Fraxinus damages are doubled.

According to the Art. 38 the grazing of goats and sheep in forbidden in the forests. The statement on the haymaking and grazing on the lands from forest fund is approved by the Government. On some areas of forest fund, that are not the habitat of rare, protected and jeopardized species of plants and animals it is permitted collection of forest fruits, berries, walnuts, mushrooms, medicinal plants etc, placement of hives apiaries, haymaking and grazing without causing any damages to forests.

Land Code References of the Land Code to the extension of forest vegetation are placed in the chapter IV (art. 29), chapter IX (art.62), chapter IX (art.71), chapter XII (art.78-79; 81; 85), chapter XV (art. 100). According to the mentioned articles landowners are obliged to ensure the effectuation of measures for prevention and combat erosion, landslides (including through afforestation, creation of systems of forest protection belts). For afforestation, land can be used that is not fir for agriculture. Change in land use is approved by judet councils (former raions). The rational use and land protection is economically stimulated (funds appropriation for land restoration/improvement, deliverance from the payments for the lands in the stage of improvement, profitable credit

11 compensation etc. ) through the financial means appropriation from the state and local budgets, creation of various improvement funds.

Law on the improvement of degraded lands through afforestation

This law contains practically all issues related to the appropriation and afforestation of degraded lands. This law defines:

* Categories of degraded lands (eroded lands, affected by landslides, salinated, sandy soils exposed to erosion, with stones, rocky, depositions of torrential alluvium, etc); * Procedures for identification of degraded lands proposed for afforestation (creation and composition of identification commissions, inventory of these lands, establishment of improvement funds, procedure of transfer under the management or sale of degraded lands to the central forest authority); * Financing of afforestation of degraded lands (afforestation should be carried out by landowners via special units, activities should be financed from the funds for improvement of degraded and polluted lands, state budget, national ecological fund, local sponsors, external funding etc; central forest authority is nominated as technical coordinator of activities for improvement of degraded lands);

Procedure for land allotment for afforestation

The appropriation of degraded lands proposed for afforestation is regulated by the Land Code, Law on the improvement of degraded lands through afforestation, Decree of the Government of the Republic of Moldova nr. 246 from May 3, 1996 "On the approval of Rules for lands appropriation".

Appropriation procedure begins with the establishment of commission for the identification of degraded lands proposed for afforestation by Judet Council, Council of Territorial-administrative Unit , Municipal Council Chisinau. In this commission participate mayors of corresponding communities (chair of commission), representatives of the territorial forest units, environmental territorial units, representatives of various land owners etc. The results of commissions activities are summarized in the act that contains information about the characteristics of selected lands (landowner, land category, number of cadaster contour etc.), a copy of land cadaster plan is attached to the act. On the base of these documents the landowner (municipality) issues a decision on the appropriation of land for afforestation, further regime of ownership (remains in continuation in the property of municipality or is transferred to the forest authority, which will effect afforestation activities, etc).

In cases when degraded lands subject to afforestation (according to the landowners decision) will remain in municipal ownership, these lands are leased to forest authority to undertake afforestation. The conditions of the lease require the forestry units to carry out

12 the afforestation and maintain the forests until canopy closure (5-10 years), after which the use of the afforested lands is returned to the municipality.

6. Monitoring and Enforcement of Environmental and Forestry Legislation

Responsibility for monitoring compliance with the forestry laws and regulations rests with the central forestry authority and Forest Inspection within the Ministry of Ecology, Constructions and Territory Development.

Moldsilva is responsible for forests management through its four divisions:

* Division on the Forest Fund and production; * Division on Forest Protection; * Forest Guard. * State Forest Enterprises, state reserves that are organized in district offices and are responsible for afforestation works, maintenance, protection and guard of new created plantations.

In the functions of the state forest authorities among other the following responsibilities with regard to forest monitoring and state control in this area are included (art. 21 of Forest Code).

a) application of technical, economic, legislative and forestry norms, that assure the observance of forestry regime; b) observance of mode of handing of standing timber; c) observance of forest management statements; d) forest regeneration and afforestation of open places; e) observance of corresponding technologies during the carrying out of activities in forest fund; f) observance of established mode of state register (inventory) of forest fund, state forest cadastre and forest monitoring; g) organization of forest guard and protection;

The Forest Code (art. 22) delegates the following responsibilities related to afforestation to state environmental authorities:

a) implementing of programs, approved by the Government concerning use, regeneration, guard and protection of forests; b) conformity of afforestation rate to established normative; c) observance of norms of use of forest products; d) repartition of forests by groups and functional categories; e) protection and use of some rare and protected species of plants and animals from the forest fund; f) provision of forest guard and protection;

13 Legislation of Moldova foresees also and the possibility of carrying out of public control on the condition, use, regeneration, guard and protection of forest and hunting funds. Thus, according to the Art. 23 of Forest Code, citizens and public associations have the right to receive from the state forest bodies and environmental protection bodies information on the condition of forest and hunting funds, planned and carried out measures concerning conservation and use of these, to propose and implement, according to the legislation, measures for guard and rational use of forest and hunting funds, biodiversity conservation in it.

14 7 Environmental Analysis: Without the Project

7.1 Biodiversity Baseline Scenario (Without-Project)

Methodology

Initially, 2,338 sites distributed throughout the country were proposed for afforestation. This unwieldy number presented a challenge. On the basis of discussions with local experts, the 8 land-use categories that were initially presented were reduced to 2 classes - pasture and degraded lands. The former subsumed the earlier categories of glades, pastures, arable land and wetlands. The latter came to include the former categories of degraded land, landslides, ravines and what was referred to as "other lands". Since 447 of the originally planned 2,338 project sites were less than I ha in size, on the basis of consultations with local expertise again, they were excluded from the project, thus making the total number of plots 1,891. The methodology also had to take into account that no quantified biodiversity baseline data exists for the individual project sites. This required the development of a tool for appraising the likelihood of occurrence of biodiversity values in certain locations. To accomplish this, the country's accepted division into three regions (Northem, Central and Southem) was adopted. These regions exhibit some degree of intemal homogeneity as exemplified by prevalent soils, rainfall and dominant vegetation cover. Using the 2 classes of pasture and degraded lands as an organizational tool, a qualitative description emerged of the potential distribution of certain biodiversity values of the sites in the country's three regions. While this methodology helped in describing the baseline, screening will be required to ensure that any presently unknown biodiversity values of the sites are determined prior to afforestation. Finally, a scored checklist approach was used to determine and compare both positive and negative project effects on biodiversity and other environmental components including soil, water, climate and landscape, in the short term (less than 2 years) and in the longer term.

Biodiversity Stratification of foreseen Project Land Units

Moldova is located at the junction of three biogeographical zones: the broadleaf western European forests, the Mediterranean forests, and the Eurasian steppe. This accounts for its high biodiversity. The country, therefore, also encompasses range limits for some known vertebrate and invertebrate species, a situation that makes these species particularly vulnerable. For example, two rodent species of Spermophilus are found in Moldova: S. citellus is found in the eastern limits of its range and S. suslica in the westem limits of its range. Both species are threatened by increasing anthropogenic stresses and the former is listed in the Red Book of Moldova and Europe. Other vertebrates, including Sicista subtilis, Cricetus cricetus, Mustela eversmanni, Aquila rapax, Circus cyaneus, Circus macrourus, Circuspygargus, Otis tarda, Tetrax tetrax, Vipera ursine, and Elaphe quatuorlineataare presently in a critical state.

15 The total area of the Republic of Moldova includes 76% agricultural lands, of which 66% have been subjected to intensive development. Natural ecosystems cover less than 20% of the country and are fragmented and degraded.

The biodiversity of the project sites is stratified on the basis of land classification (pasture lands and degraded lands) and geographical zones of the country (Northern Zone, Central Zone and Southern Zone). The pasture lands category includes currently used pasture lands, glades, and former arable lands that are now abandoned. The degraded lands category includes: degraded (denuded) lands, landslide areas, gullies and ravines.

Moldova's landscape and biological diversity is found in three zones. The Northern Zone is characterized by a damp climate (550 mm annual rainfall), forest soils, and the dominance of pedunculate oak (Quercus robur) and cherry. The Central Zone is a more compact forest massif and is comparable to the broadleaf forest of the central zone of Europe. The annual rainfall varies from 250 mm to 500 mm. Soils vary from brown to gray and light gray forests soils on slopes to dark gray forest soils in depressions. The dominant tree species are Fagus sylvatica, Quercus petraea and Quercus robur. The Southern Zone is the driest, and is characterized by oak at the higher elevations, and pedunculate oak mixed with blackthorn at lower elevations. Fluffy oak forests (Quercus pubescens) are found on south and south-western slopes at lower elevations. The Southern Zone, however, is principally a steppe zone. The steppe community is the most threatened biodiversity in Moldova. There is essentially no original steppe ecosystem remaining. Rather, the original steppe is now represented by transformed fragments amid fields and on slopes unsuitable for agriculture.

Tables 3 and 4 list the number of vertebrate species and Red Book vertebrate species associated with pastures in the three zones. Pastures, especially those of the southern zone, are of greatest importance for species entered into the Moldova Red Book, accounting for the presence of 86% of the species in the table and just under 10% of all faunal species in the country's Red Book. Among potential project site vertebrates found in the Red Book, the greatest number of species represents birds and reptiles.

16 Table 3. Estimated Species Diversity of Vertebrates Potentially Utilizing Pastures and Degraded Lands of Moldova Northern Zone Central Zone Southern Zone Order Pastures Degraded lands Pastures Degraded lands Pastures Degraded I__ _ _lands Mammals 14 13 14 14 11 6 Birds 17 6 18 6 19 5 Reptiles 3 3 3 3 8 5 Amphibians 2 1 2 1 2 1 Totals 36 23 37 24 40 17 Source: Dr. A. Munteanu - Scientific Director, Institute of Zoology, Moldova Academy of Sciences, pers. comm.

Table 4. Estimated number of vertebrate species in the Moldova Red Book associated with pastures and degraded lands of Moldova. Northem Zone Central Zone Southern Zone Order Pastures Degraded Pastures Degraded lands Pastures Degraded lands lands Mammals 2 1 1 1 1 Birds 4 - 4 - 5 - Reptiles 1 4 2 Amphibians I 1 1 Totals 7 1 7 1 11 2 Source: Dr. A. Munteanu - Scientific Director, Institute of Zoology, Moldova Academy of Sciences, pers. comm.

Present and future Biodiversity Functions of defined Ecological Land Units

The project sites were selected over the last five years based on their degraded condition and the agreement between Moldsilva and municipalities that afforestation of these lands is the most feasible method for mitigating erosion and associated environmental problems.

The number of species on the project sites are lower than the total numbers of species associated with pasture habitats in the country (as shown in Tables 3 and 4), based on the poor condition of the vegetative cover and human disturbance. Among potential project site vertebrates found in the Red Book, the greatest number of species represents birds and reptiles. It should be noted, however, that the listed bird species are migratory, whereas the reptiles are not.

The floral diversity of the project sites is now impoverished and transformed as a result of overgrazing pressure that exceeds the norm by up to 400%. The vegetation of pasture lands is primarily comprised of hardy species that have become mixed with weedy species. In the Northern zone, the primary communities found on the degraded pastures include: Stipo capillatae- Bothriochloetum herbosum; Festuceto valesiaci - Bothriochloetum herbosum; Festuceto valesiaci - Bothriochloetum ischaemii; Poaeto bulbosi - Bothriochloetum ischaemii; and, Poaeto angustifolii - Festuceto valesiaci -

17 Bothriochloetum iscaemii. Species found in the Central zone pastures include: Festuea sulcata, Stipeta ucraini;S. lessinae; S. pennatae; S. tirsi; S. pulcherrimae;Fistuceta valesiaci and S. herbosum. Species of the less disturbed Southern zone pasture species include: Festuea sulcata; Stipeta ucraini; S. lessinae; S. pennatae, S. tirsi; S. pulcherrimae;Fistuceta valesiaci and S. herbosum. Species of more disturbed pastures include: Festucetum herbosum; Festucetum valesiaceae and Festuca valesiaca. The most valuable and botanically diverse areas are those situated on floodplains and other wet areas.

The defined project land units represent severely degraded and largely abandoned lands that, depending on the individual parcel, possess limited biodiversity value in their present state. While they ,were once productive and covered either in forest or steppe vegetation, today they are subject to water and wind erosion, landslides, and gully and ravine formation. Some low-quality grazing occurs for several months in the spring on some of the sites. The destruction of the original land cover throughout Moldova, and particularly forests, has resulted in the degradation of ecosystems and their functions. Due to severe overgrazing, pastures are now severely degraded, and their vegetative cover has been transformed to include more resistant and weedy species. These negative changes in vegetation cover have resulted in a range of undesirable environmental consequences, including impacts on wildlife through the loss of habitat.

The site visits confirmed the degraded condition of the project sites. The project sites represent severely degraded and largely abandoned lands that, depending on the individual parcel, possess limited to essentially no biodiversity value in their present state. However, it was not possible for the preparation team to visit all 1,891 project sites. Therefore, further assessment of the biodiversity of each of the sites, and in particular those larger than 10 hectares, will be needed as part of preparation of annual workplans for afforestation. The purpose of these studies will be to assess biodiversity of the individual sites and develop appropriate mitigations in accordance with environmental safeguards established under Moldovan law and World Bank requirements.

Selection of tree and shrub species for afforestation

Afforestation activities are diverse and depend on many factors, the most important of which are: (a) status of the soil; (b) climatic conditions; (c) presence and concentration of soil carbonates; (d) species specifics; and (e) relief characteristics. Table 5 lists the indicative tree and shrub species that would be used based on specific site conditions (land use and slope).

In the project areas the species to be used are native species (Populus alba, Populus nigra., Salix alba, Quercus robur, Fraxinus excelsior) and non-native species (Robinia pseudoacacia, Gleditschia triachantos, Sophorajaponica, Quercus rubra, Fraxinus viridis, Elaeagnus angustifolia, Pinus nigra). The success of afforestation of eroded lands relies strongly on indigenous brush species, which improve the structure of plantations as well as the soil condition. The native brush species to be used include Cotinus coggygria, Crataegus monogyna, and Rosa cannina.

18 Based on the specific afforestation plans for each of the projects sites and the norms summarized in Table 5, the total percentage of native tree and shrub species is shown in Figure 2. Figure 3 shows the percentages of trees and shrubs for the same three groups identified in Figure 2.

Figure 2. Total percentage of native tree and shrub species for the 14,493 hectares of land planned for afforestation.*

12,000 00 11,206.90

10,000.00

8,000.00

6,000.00

4,000.00 2,857.00

2,000.00 34=% SOY_ , 0.00 ~429.70 34% 50% 100% * 429.7 hectares of the most degraded sites will be afforested using 34% native species; 11,206.9 hectares will be afforestated using 50% native species, and 2,857 hectares will be afforested using 100% native species.

Figure 3. Percentage of tree and shrub species for the 14,493 hectares of land planned for afforestation*.

90.00 81.00 81.00 80.00 - 5-5.G0_ 70.00 - 60.00 50.00 lree 40.00 Uhrub 30.00 5:00 19.00 19.00 20.00

0.00 _ _ 430 11,207 2,857 * 3287 hectares (430 + 2857) will be afforested with 81% trees and 19% shrubs; 11,207 hectares will be afforested with 75% trees and 25% shrubs

19 The selection of species was also based on the following: (a) non-native species would play the role of pioneers for the soil improvements. These species would improve the degraded soils and would create appropriate conditions for planting native species, which will be possible after the first productive cycle of non-native species; (b) by using non- native species it is possible to provide benefits (in wood and non-wood forests products) for the local population sooner; (c) in non-native forests it would be possible to permit grazing in a relatively shorter time, thereby reducing the costs to the local population.

On the partially degraded sites, and wherever soil/site conditions allow, native species will be planted. On the rest of the lands, which are marginally appropriate for afforestation due to their extreme soil conditions, afforestation works would be carried out based on the following tested method for ecological restoration: 1) establishment of forest cover using non-native species that are known to survive on degraded soils; and 2) secondary planting using native species. Plantations of non-native species are managed on short rotations and assume restoration of native forests after the first (maximum second or third) production cycle. After the soil conditions have improved (after one or two rotations of robinia) native species could be planted on improved soils.

The following non-native species were selected for afforestation works:

Robinia pseudoacatiais well-adapted for use on the highly degraded soils found in Moldova, with its rapid root growth and well developed root system. It also has a short productive cycle (25-35 years), is an important source of fuel wood for household heating and cooking, and sprouts well following cutting. Some scientists consider this non-native species to be "invasive", which means that it colonizes undisturbed and/or disturbed soils. However, the history of its introduction in Moldova during more that one hundred years has shown that the species is a pioneer species of degraded lands. It was selected because it is the only species that can survive in extremely impoverished soils. In addition, it is fire-resistant, provides good utility to local users in the form of poles and fuelwood, and creates good wind breaks. Based on Moldovan and other published papers (in particular Romanian), Robinia invasion is not a problem, as it naturally happens extremely slowly.

* Quercus rubrais adapted to extreme climatic conditions and to very poor soils (on both sand soils and on the soils placed on the claims); is disease- resistant with strong root development; has a high productivity per ha and, with a relatively short productive cycle (70-100 years), has a wood which has nearly the same good quality as Quercus robur;

* Pinus nigra is resistant to dry and cold seasons/periods, with strong root potential, and with a good capacity to grow on and enrich poor, sandy and rocky soils; it is also resistant to different diseases, with a high growth rate;

20 Ulmus sp. is capable of growing on the poorest soils, even with high salinity; it is resistant to frost and drought, with a high productivity and relatively short productive cycle;

Gleditschia triachantos- could grow in height up to 25 meters, it is rapidly grow tree specie, resistant to drought, it is not so exacting to soil, resistant to soils with salts and carbonates that are on the surface.

Sophora sp.: is resistant to the presence of salts and carbonates in the soil, can grow on poor soils, has a high growth rate and very short productive period (25-40 years), with high wood density.

21 Table 5. Land categories, afforestation species and needed forest activities

Main Forest Additional Species, Species/ Share Land Use Category Soil Condition Forest Activities Share 1 2 3 4 5 Secondary (25-12%) * glades and waste grounds Slopes (6-120) with uneroded * Soil preparation, partially or Acer platanoides * degraded pastures soils, slight eroded or moderate completely, mechanized Acer campestre * degraded agricultural eroded * Manual or mechanized plantation of Pyrus communis lands about 6000 seedlings/ha Prunus avium * Plantation method with Kolesov Malus sylvestris spade or plantation machine with Oak (or Fraxinus excelsior seedlings of 2-4 years Sessile oak) Tilia cordata * Tending through manual or (50-75%) Carpinus betulus mechanized weeding, by years 1-7, II- Ash 6, III- 5, IV-4, V-3, VI - 2 Bushes (25-13%) * Completion of plantation in 2, 3 years Corylus avellana through the substitution of dry Cornus inas seedlings Viburnu. opulus * Protection measures by using of Vibirnum lantana chemicals Sambuscus nigra Secondary (12%), * Glades and waste places Inferior slopes up to 60, flood- * Complete soil preparation, Acer platanoides * degraded agricultural plains alluvial soils mechanized Tilia cordata lands * Plantation of seedlings, 2200 pcs/ha Ulmus glabra * Degraded pastures * plantation in pits 60cmx6Ocmx60cm Poplar (white Alunus glutinosa * Tending through manual and or black), Fraxinus excelsior mechanized wedding by following willow (75%) Bushes (13%) scheme 1-5, 11-3, III- I wi %) Bushes(13%) 0 ~~~~~~~~~~~~~~~~~~~Completionof plantation in 2, 3 years Corylus avellana through the substitution of dry Cornus mas seedlings I Vibirnumn lantana

22 Sambuscus nigra * Protection measures by using of Viburnum opulus chemicals

Secondary (25%) Landslides Active landslides * Soil preparation through creation of Acer platanoides ravines landslides beds or lines (3,0 xl,5-2,0 m) or lines Acer campestre glades and waste lands * Landslides - semistabilized at a distance of 3,0-4,5 m), manually or Pyrus communis and active embankments mechanized Prunus avium * Landslides -steps * Manual plantation of about 6000 Malus sylvestris semistabilized, eroded from seedlings per 1 ha Robinia Fraxinus excelsior moderate to excessive and * Plantation method - with the help of pseudoacacia strong excessive, carbonates Kolesov spade with 1-2 years seedlings 50% Bushes (25%) appear on the depth of 50-100 3,0x0,7 -0,5 Cotinus coggygria cm * Tending through manual wedding by Crataegusmonogyna * Alcalization deeper than 50 following scheme 1-5, 11-3, III- 1 Ligustrum vulgare cm * Completion of plantation in 2, 3 years Rosa canina * slopes with 6-35 degree and through the substitution of dry more than 35 degrees seedlings

Secondary (25%) * Landslides * Appearance of carbonates on * Soil preparation through creation of Acer campestres * ravine the surface and up to the depth beds, lines - complete, manual or Malus sylvestris * Glades and waste places of 30-50 cm mechanized Pyrus communis * Other degraded lands * Weak and moderate-strong * Plantation manual or mechanized of G.edits.a Unlmus glabra * Degraded pastures salinization on the depth 6000 seedlings/ha Gleditsia Bushes (25%) (>100 cm) * Plantation method - with the help of triacantos, Cotinus coggygria Kolesov spade with 1-2 years seedlings Sophora Crataegus monogyna 3,OxO,7 -0,5 japonica (50%) Rosa canina * Tending through manual wedding by following scheme 1-5, 11-3, III- I * Completion of plantation in 2, 3 years through the substitution of dry seedlings Quercus rubra Secondary (25%) * Landslides * Semistabilised and stabilised * Soil preparation - partial or complete, (50%) Acer campestres * Degraded pastures landslides mechanized

23 Acer platanoides * Former agricultural * Moderate eroded and weak * Plantation manual or mechanized of Malus sylvestris degraded lands eroded 6000 seedlings/ha Pyrus communis * Glades and waste grounds * Texture clay * Plantation method - with the help of Ulmus spp. Kolesov spade with 1-2 years seedlings Bushes (25%) 3,OxO,7 -0,5 Hippophae * Tending through manual wedding by rhamnoides following scheme 1-5, 11-3, III- I Prunus mahaleb * Completion of plantation in 2, 3 years through the substitution of dry seedlings Secondary (17%) * Landslides * soils eroded excessively from * Soil preparation in beds manually or Pyrus communis * Ravines the surface and eroded very mechanized Acer tataricum * Glades and waste grounds strong * Manual plantation of aboutt2400 Acer platanoides * Other degraded lands * Mother rock at the surface seedlings/ha * Strong and very strong * Plantation method - Kolesov spade with Bushes (17%) alcanization 2-4 years seedlings Pinus nigra Cotinus coggygria * Excessive and very strong * 600 beds per 1 ha at 4 seedlings each of (pallasiana) Crataegusinonogyna gluey process main specie and at 2 secondary species 64% Rosa canina and bushes Ligustrum vulgare * Tending activities though manual Prunus spp. wedding by years 1-6, 11-5, III-4, ID - 3, V-2, VI-l * Completion in 2,3 years through substitution of dry seedlings

24 Benefits and Risks of the Development Scenarios

With the continuation of low quality grazing on the pasture lands, decreasing soil fertility and increasing erosion, some of the still existing species of vegetation will disappear. Wildlife will continue to generally avoid most of the sites and any species still present will likely disappear as the remaining vegetative cover is further reduced. Lands presently used as pasture will continue to degrade. The risk associated with the business-as-usual scenario is that unless restorative measures are urgently undertaken, these lands will become depleted of nutrients and incapable of moisture retention and will thus become completely unproductive and incapable of supporting biodiversity in the future.

7.2 Soil Conservation Baseline Scenario (Without-Project)

Methodology

Soil conservation aspects are already reflected in the original site description data base, where 4 classes of surface or sheet erosion (moderate to excessive) and 4 classes of linear or rill erosion (slight to very strong) were distinguished. Soil conservation aspects are equally present in the land-use stratification of project sites (Degraded Lands, Pasture Lands with the subclasses Humus rich and Humus poor Sites). These aspects were then also taken into account during the visits to the plots, where types and grades of erosion were estimated and litter and humus levels were measured. These variables plus measurements of the actual surface erosion will also be included in the monitoring procedures.

For elaborating a soil conservation baseline, the land-use stratification of the project area described in the Baseline Study has been considered appropriate and was consequently adopted. for the sampling procedure and baseline description.

Status of Surface Erosion and Organic Matter Content

Soil erosion is one of the main factors that have affected soil fertility in the Republic of Moldova. The eroded surfaces constitute 1,205 thousand ha or 80 percent of the arable land, of which the moderately and strongly eroded soils cover an area of 780 thousand ha, with an annual increase of 0.86 percent. The fertility of eroded lands is 40-60% lower than that of intact sites. Humus is the basic index of soil fertility. It determines the most important physical, chemical, biologic and agrochemical properties of the soils. The Republic of Moldova has about 81,000 ha of degraded lands (3%) that are unsuitable for agricultural use or request considerable financial investments for its improvement.

Different forms of erosion were observed on the project sites: Mass movements (landslides, soil creep, tillage erosion) and particle movements (through-wash, rainsplash, rainflow, rillwash, gully erosion). The initially superficial erosion is caused in the beginning by raindrop impact, that effectively breaks down soil aggregates into constituent soil particles. These particles are re- deposited between aggregates on and close to the surface, forming soil crusts, which seal the surface, and limit infiltration by filling the macropores between the aggregates. The greatest importance of these crusts is in increasing runoff from storm rainfall, causing heavy gully

25 erosion and flooding. With a very slow rate of soil formation, any soil loss of more than 1 t/ha/yr can be considered as irreversible within a time span of 50-100 years (Grimm & Montanarella 2002). About 27% of the project areas are classified as degraded lands that are practically excludes from the general production circle due to the occurrence of ravines, landslides etc. Information of the database of project sites show that 35% of the area show moderate to excessive, mainly surface erosion (Error! Reference source not found.6).

Table 6: State of Erosion in the Project Sites Surface Erosion Linear Erosion Without Total S1* S2** S3*** S4 Al A2 A3 A4 Erosion moderate strong very excessive slight moderate strong very strong strong No. of plots 191 241 143 38 11 4 21 25 1,217 1,891 Area (ha) 1,420 1,797 1,149 340 57 27 195 124 9,385 14,494 Area fraction 10 12 8 2 0.5 0.5 1 65 100 * include Sl-S2, ** includes S2-S3, *** includes S2-S4

From the 14,494 ha of project sites, 87% are still considered as humified and moderately humified soils (> 2%), but 13% are only slightly humified (< 2% humus content). On the 14 inspected sites, the average amount of organic matter was fairly high with 126 t/ha in for degraded lands and 148 t/ha in pasturelands. The protective litter layer, however, was missing in various sites.

Likely Development of Soil Conservation and Land-use Consequences

The evolution process of the areas in the case without project implementation can be forecasted as follows: The degraded land (ravines, gullies, landslides etc) are essentially excluded from productive usage. Leaving these lands in their present state will lead to the extension of surfaces of ravines, landslides etc. Since over 60% of the project territories are situated on slopes with an inclination greater than 70, erosion processes are proceeding very quickly with annual losses of 50 t/ha of soil and 1.5 t/ha of organic matter, equaling 0.9 t/ha of carbon loss. Soils have also become drier and exhibit increasing salinization. In the absence of any stabilizing and restorative measures, there will be continued soil loss and decreasing soil fertility.

7.3 Other Environmental Issues in the Baseline Scenario (Without-Project)

Water - The water table has become lower in many places due to the progressive loss of vegetation. Past application of fertilizer and herbicides in the pastures has likely also resulted in the contamination of both ground water and surface waters. Although surface water quality has been showing an improvement over the past ten years, the concentration of nitrates in groundwater exceeds permissible norms from 1.3-3 times in the Northern zone, to 3-4.3 times in the Southern zone. This has been caused by the leaching of nitrates through the soil that are not taken up by any tree roots. In locations where project sites are located in the proximity of water bodies, eroded soils likely increased siltation and chemical pollution of the water bodies and wetlands thereby decreasing water quality and possibly contributing to the loss of fish spawning

26 habitat and breeding habitat in wetlands. The continuation of the baseline scenario will exacerbate these negative effects.

Climate - The continuation of the present situation will exacerbate local negative microclimatic conditions on the project sites and adjacent territories. These negative effects will be manifested in winds carrying away soil, the shifting of surface deposits, decreased evapotranspiration, and increased CO2 emissions. The effects of airborne transport of the chemicals to adjacent lands and communities cannot be discounted as well.

Landscape - In the near term of less than 5 years, there will be little appreciable impact on the appearance of the landscape. Over a longer period of time, with the continued degradation and eventual forced abandonment even of the infrequently used pastures on account of the eventual exhaustion of their productivity, even more lands will become completely degraded. Erosion processes will increase in spatial extent resulting in more areas subjected to gully and ravine formation and mass wastage. The negative impacts of these processes on adjacent lands, waters and communities will become even more dispersed and intensified. The lands are also too degraded to offer any recreational opportunities. So in the medium to longer term, all landscape level impacts will clearly be negative and consequential.

Summary of Baseline Scenario Development Impacts

In summary, the various impacts (ecological, economic, social) from the development of the baseline scenario are estimated to be mostly negative (Table 77).

Table 7. Checklist of potential impacts for continuation of existing land-use. Impact _ Ecological [Economic Social Land category - - - i and land-use E category o 3 O 0 E o -~~ o~ oE > 0 0 co ti

Landslides -3 -3 0 -2 -1 0 -3 0 0 -2 -3 0 Ravines -3 -3 0 -2 -3 +1 -3 0 0 -3 -3 0 Other degraded 3 3 O -1 -3 0 -2 0 0 0 -3 0 lands ______Degraded arable _3 -2 0 0 0 0 -1 +1 +1 -1 00 lands I2O I I I O Degraded 1 -I 0 0 0 0 0 +1 0 0 0 0 pastures______Glades and open l1 0 -1 -1 -1 +1 0 K places______Subtotal -9 -9 0 -5 -7T+1 -5 0 0 -5 -9 0 degrade d lands ______Subtotal T ! -1 1 1 T +2 +1 -1 l pastures __ j ___ 1 project w4 o [ -6 -8 +2 +1 -9 |

27 Likely potential impacts without any mitigation measures were evaluated on a scale from -3 to +3, where -3 refers to major negative impacts, and +3 refers to major positive impacts

The only exception are employment and direct income that may arise on degraded arable or pasture lands under the constraints of accelerated degradation.

8. Environmental Analysis: With the Project

This section identifies and summarizes all anticipated significant adverse environmental impacts in both terms, - positive and negative and describes the process evolution for two alternatives, - without project implementing and with the project activities.

The timeframe of the project is one rotation for Robinia i.e. 30 years. This timeframe does allow for all forest activities over a rotation to be included in the impact assessment. The spatial boundary is limited to the identified project sites in the Baseline Study, apart from the monitoring of social impacts which extends to the adjoining settlements. Thus the spatial boundary for the environmental impacts is the defined project sites plus surrounded them communities.

The project's impacts are generally positive. Several negative impacts on the soil and water quality at the initial stage of site preparation for afforestation are local, temporary, and minor in magnitude. For the negative impacts further in the report are presented a series of mitigation measures what should be undertaken (see section 14.1)

8.1 Expected Project Contributions to Sustainable Development

Major socio-economic benefits for the local population

Temporary employment. The project will mainly result in the creation of temporary jobs. Many villagers mentioned that they expect additional jobs, even if the land is transferred to Moldsilva. There is a tradition that Moldsilva employs local people as casual workers, and pays them either cash or in kind (especially firewood). While in some locations it was stated that everybody has the chance to participate in afforestation activities, in others it was stated that predominantly people with working experience in the forest would be employed. Last year planting activities involved sometimes school pupils, as adults worked on their agricultural fields. In assessment of employment opportunities, it has to be considered that for the majority of rural people agriculture has first priority and forestry is just seen as a side activity with limited financial merits. Time conflicts with the agricultural calendar will be, so far possible, avoided in the future in order to maximize employment benefits for local people (e.g. by planting the trees in autumn).

If the afforested area will belong to communities, one may expect that the people involved in planting not always get paid, but contribute labor free-of-charge. The employment effect would be thus limited. So far, with the exception of school pupils involved in planting, this was apparently rarely the case. In general, if people contribute free labor for afforestation, it has to be assured that they will later be in the position to reap the benefits (environmental as well as economic).

28 Employment opportunities may involve soil preparation, planting, weeding, tending, guarding, thinning and ultimately harvesting. For the project, the afforestation activities are by far more important, most of the thinning and harvesting activities will take place after project end.

The temporary employment effect will depend on the degree of mechanization. The more manual work, the better the employment effect for the people. It can be assumed that in the management of communal forests more manual labor will be used than in the areas transferred to Moldsilva. Moldsilva usually uses machines for soil preparation as well as planting machines on flat terrain. For instance, in Gagauz region planting machines were employed in last year's plantation activities and pupils compressed the soil afterwards. Amount and prices of labor and machines used for forest establishment respective site preparation on pasture and degraded land according to planting modules are presented in the Baseline Study. Table 8 shows the amount of labor days needed for site preparation in the different afforestation modules. The current cost for unskilled labor is Lei 37 per day (US$ 3).

In terms of gender, it seems that mainly men would benefit as they are doing most of the harder work such as soil digging, planting and tree cutting. Women are mainly involved in nursery work, weeding and collection of non-timber products and branches in case of sanitary harvests.

Another distinct feature of the temporary labor effect, particularly in regard to plantation work is that, while many people can potentially receive additional off-farm income, the income is rather small per person. This is due to the fact that the planting season and thus the number of working days is limited. The calculation sheets provided by Moldsilva for the afforestations result in the following amount of unskilled local labor which would be created through the project:

For 1 ha plantation about 7 people could be employed for 1 day per year (7 years for forest establishment assumed). For the project in total, this means about 670,674 working days of employment that would be created by plantation activities only. Considering an average plantation area of 50 hectares per village, 350 working days per year could be created in an average village.

29 Table 8. Skilled and unskilled labor needed for afforestation activities under the project.

Calculation of forest establishment Modul I Pasture Quercus Required Days per Year

.______20031 _ _ _ 2004 1 2005 1 20061 2007 12008 2009

Labor I I I _ I Skilled 0.94 2.53 Unskilled 27.16 21.60 17 12.90 8.64 4.32 Robinia Required Days per Year Labor l l [ l l l1 l Skilled 0.94 [2 53 1 I1 . . Unskilled I 22.80 [ 12.90 4 = = Populus Required Davs er Year ILabor I ______I___ I _ I i |Skilled I 0.62 | 0.97 | l l l

|Unskilled I 13.88 | 1011 1 3 _ Calculation of forest establishment Modul 2 Degraded Land ,Quercus Required Days Per Year Labor l ~ I I I I I Skilled 0.94 1 2.53 ___ Unskilled 27.16 1 21.60 17 12.90 8.64 4.32 ,Robinia Required Days per Year Labor l l l l_l_l_l_l

Skilled |J 094 | 1.90 | _ i l Unskilled l 22.80 | 12.90 l 4 _ r l

In total, 1.1 million US$ of income through unskilled labor will be generated (Table 9).

Table 9. Amount of income by unskilled (lo al) project labor. Income Income (Lei) (US$) Total income earned by unskilled workers during 24,814,927 8,271,642 the afforestation of 14,494 ha Total income per year of unskilled labor generated 3,544,990 1,181,663 through the afforestation of 14,494 ha Total income of unskilled labor in the afforestations 245 82 per ha and year I l

Daily workers currently receive 37 Lei/day from Moldsilva. However, it is noted that this amount on which the above calculation is based on, seems to vary, from 10-15 Lei/day (in Dumbravita) to 30 Lei/day (in Chirsova) and up to 35-40 Lei per day (in Teleseu).

Permanent employment. The creation of permanent jobs will be limited as most of the professional work can be done by current Moldsilva staff. The management planning will be done by 2 Moldsilva professional staff at district level. New jobs in tree nurseries are also not very likely, as the present capacity of Moldsilva nurseries is only utilized at about 50%2. Yet, due to the additional tasks, permanent jobs can be sustained. Moldsilva normally employs 1 forest guard for 200-300 ha (monthly salary 500 Ley). Assuming that for each 250 ha planted a forest guard would be newly employed, 36 new positions could be created on about 9000 hectares of permanently transferred land.

2 Currently, 35 million seedlings are produced nationwide per year, the capacity would permit production of up to 80 million seedlings.

30 According to the law, communities have to employ a forester (technical college) if their forest area (including shelterbelts) is larger than 60 ha. Assuming that for each 60 ha of community forest a community forester is employed, 90 positions could be created. However, this is a positive scenario as not every village will reach 60 ha forest area and villages with larger forest area would still need only one forester.

In the long-term future, a substantial number of additional jobs in the wood chain (processing and manufacturing) will be created as an effect of the project.

Availability and ownership of forest products, especially firewood. The local population will benefit from the increased availability of firewood. It is expected that in average an amount of forest products and firewood of 4 m 3/halyr (oak forest) or 8 m3/ha/yr (robinia forest) can be harvested on a sustainable level (both figures from site class III and within 30 years). As can be seen from these figures, the socio-economic benefits for the local population will be larger for shorter rotations and fast-growing trees.

About 60% of the population depend on fuelwood for heating. The average demand per household is about 7 (5-1 0) ster (about 5 m3 ) per heating season. Currently, the price for one ster of good quality firewood is about 130-150 Ley. Considering the average daily wage of 37 Lei, a villager has to work almost two months in order to generate enough cash income to buy the needed firewood. While the project will not solve the firewood problem in Moldova, it will provide wood resources for the local market and thus contribute to more stable wood prices which may skyrocket without the project due to scarcity.

Aside from timber the plantation forests have moreover economic value for the local population through the use of non-timber forest products. These include medicinal plants, bee-keeping (especially in Robinia forest), hunting leases, and grazing. The potential income through selling the fruits of Rosa canina, which is planted as shrub species on the afforestation plots is especially high (139-417 US$/ha/yr).

In case of community forests, the mayoralty will be the owner of the forest products and will realize income from forestry which can be partly used for community development. Besides, it will be in the position to allocate forest products according to its priorities. The allocation could be based for instance on the amount of labor a person has contributed. Besides, the community could decide to make firewood available at low cost for the needy and vulnerable groups, e.g. pensioners and female-headed households with many children.

If the land is transferred to Moldsilva, many people consulted in the interviews said that they still expect a benefit as the firewood would be sold by Moldsilva for a competitive price and transportation costs could be reduced. But for the rural poor, the price Moldsilva charges is currently too high, and this may not change in the future. In the long run, there will be additional socio-economic benefits in terms of increased availability of non-wood products such as medicinal plants, fruits and berries (e.g. walnut), mushrooms, vines for basketry, game (rabbits, deer) and tourism.

Reduced damages due to soil erosion and landslides and improved yields on neighboring fields. As described earlier (see chapter 2.3.1.3), landslides and soil erosion result in a huge economic

31 loss for Moldova. Besides, individuals suffer from damages to houses and downhill agricultural areas. It is difficult to quantify this losses which occur randomly and may not effect everybody's livelihood, but certainly poses an immanent risk, that the majority of rural people is well aware of. About 85% of the project area is degraded and may become irreversibly damaged if adequate measures are not taken by the project. Thus, in the worst case scenario, the project will save 12,300 ha of land from becoming permanent wasteland. It will permit that these lands provide the basis for forest management and thus sustainable rural livelihoods.

The afforestation will also have a positive effect on neighboring agricultural fields. The yield can increase significantly (up to 70% according to an expert opinion) since the hydrological regime will be improved and wind erosion and drought occurrence reduced.

Possibility of rotational grazing in forests. The areas to be afforested are either permanently degraded or low quality pastures which will further degrade as grazing continues. Due to the soil conservation measures introduced by the project, the project area (14,500 hectares) will be rehabilitated. It is a frequent expectation of the local population that hay harvesting (cut and carry) could be allowed in the forest plantations and that after about 10 years, at least cattle grazing could be permitted. This may not be possible on each site and may require the introduction of rotational grazing systems, but certainly is an option which should be considered

Development of community-based forest management and increased participation. A benefit of the project which so far received relative little attention is the introduction of community-based forest management which is a new concept in Moldova. Through community forestry, rural people will not only have a say on the future management and conservation of community forests, but they will also get the possibility to directly benefit from local forest resources. Furthermore, the realization of the ambitious national afforestation target will only be possible with the involvement of the local people who ultimately have to provide the land for afforestation. It is obvious that the willingness to provide land for afforestation will increase as people realize the tangible benefits from community forestry. In this regard, the project will have a pioneer role.

Potential socio-economic losses for the local population

Possible displacement of local people. The sites to be afforested have been carefully selected involving democratically legitimated local councils and other stakeholders. During field visits, it was confirmed by all stakeholders that, but a very few exceptions3 , only degraded and overgrazed land areas with very limited forage value have been made available for the project. The only potentially negatively affected groups are thus livestock owners and herders/shepherds.

No community members will give up their present profession and/or resettle due to the project. The project plots are dispersed and most are small. Besides, as can be seen in Table 10, the total afforestation area in a village ranges about 3-24% of existing pastures, and the animal grazing density is not changing drastically after afforestation takes place (Note: the total afforestation

3 This exceptions relate to some remote plots which are only accessible at high costs and/or marginal agricultural land which is not needed anymore, e.g. because of out-migration.

32 area includes to a large extent degraded lands less used for grazing, so in reality the reduction of pasture area is smaller than depicted in the table).

Table 10. Afforestation area in relation to cormunity pastures of visited villages Community Pastu Affores Reduction in Number of Total Livestock Livestock (District) res tation area available animal livestock units per ha units per (ha) (ha) for pasture heads per units 1) of pasture ha of through household without pasture afforestation project with (%) _ project Ucrainca (Ti) 720 195 27 3.5 400 0.56 0.76 Opaci (Ti) 930 62 7 7.1 1000 1.08 1.15 Alessandro Felid 524 64 12 9.8 600 1.15 1.30

Lebedenco(Si) 531 14 3 4.8 570 1.07 1.10 Albota (Si) 985 214 22 9.8 580 0.59 0.75 Cucuruzeni (Or) 1070 46 4 2.0 1095 1.02 1.07 Chirsova (Co) 1450 349 24 3.1 650 0.45 0.59 (Co) 600 70 12 4.0 915 1.53 1.73 Gaidar (Co) 400 40 10 3.5 720 1.80 2.00 Chiscareni (Ba) 2262 165 7 1.5 870 0.38 0.41 Dumbravita (Ba) 717 39 5 2.2 415 0.58 0.61 Districts: Ti = Tighina, Si = Silva Sud, Or = Orchei, Co = Comrat, Ba = Balti 1) Cattle = 0,7; sheep/goats = 0,05

The only form of displacement which can be discerned is that for at least 10 years, grazing will be controlled (but not excluded) on the afforested sites. As grazing takes place on communal lands, sometimes confined to certain grazing areas, but normally with free access to the whole grazing area, herders will move the livestock to other communal grazing areas. In case of severe overstocking and competing land-use claims, the responsibility to mediate conflicts and possibly identify compensatory measures lies with the mayoralty which therefore has had an inherent interest not to allocate too much land for afforestation. As community decision-making will evolve with the introduction of community-based forest management, problems will be identified and jointly solved in the future.

In some cases villagers complained that the proposed afforestation would block the way to communal pasture lands. To our knowledge, these problems were identified and jointly solved. In general, the afforestation sites are fragmented and small, so it is unlikely that this problem arises frequently. Where it arises, the right to pass through the forest area can be given, provided adequate protection measures are in place (e.g. fence on both side of pathway). The costs should be borne by the village council or Moldsilva.

Possibly required livestock reduction causing negative effect on local livelihoods. The net effect of the project on local livelihoods is positive. It provides employment and income and sustains the natural resource base which is required for attaining sustainable livelihoods. It is currently not expected that the project would result in a reduction of livestock numbers, although this may be required in the future in order to achieve sustainable management of pastures. The reduction of livestock numbers may require certain incentives or compensation for livestock holders. This

33 problem can ultimately only be solved in cooperation with other organizations and projects. However, the project may assist in initiating a discussion process about sustainable carrying capacities and contribute to compensation mechanisms, as it starts to generate benefits for the local population.

Job loss in other sectors. It is not expected that there will be any negative effects on employment in the agricultural or livestock production sectors by the project. The lands to be afforested are either degraded and thus unused land or low quality pastures which can be used only very limited time in the grazing season (frequently a period of one month was mentioned). Due to the small parcel size, dispersed distribution and the communal grazing regime, herders/shepherds will concentrate on the existing communal pasture land, but almost certainly will not have to abandon their profession. It is also unlikely that the project will directly cause a reduction in livestock numbers which could effect employment of herders. An indirect effect may be that of increased grazing pressure leading to further degradation of existing pasture areas which ultimately results in giving up pasture land. However, this scenario is based on unsustainable grazing practices in the first place, but not the project.

Expected net socio-economic Effects of the Project against the Baseline

The use of land through extensive grazing leads to degradation of this land and with that a decrease of income generated through livestock (cf. chapter 3. 1). The income generated through sheep herding will reach zero in the course of continued use of pasture over 17 years if the annual loss is estimated with US$ 162 per village.

The net effect of the soil conservation and afforestation project on local livelihoods is positive. It provides in the initial years with employment and income (estimated with US$ 82 per year, seven years afforestation period = US$ 574). Most important, it sustains the natural resource base which is required for attaining sustainable livelihoods. The plantation modules will lead to a positive rate of return as and will become important sources for fuel-wood and timber production.

In summary, the net socio-economic benefit of the project will be certainly positive. There are clear benefits of the project, and likely losses as identified, are comparatively small and can be mitigated. Even if we assume an optimistic baseline scenario with balanced economic growth, the project would contribute to an improvement of the rural environment as well as sustainable rural development. The 1999 Poverty Assessment emphasized the importance of promoting the development of rural areas, in order to combat poverty. The project will assist in tackling the inequality of people living in rural and urban areas with its strong rural focus. Besides, it will provide support to 151 communities and a great number of beneficiaries in the rural area. Since it would be highly speculative to make quantitative forecasts about the net socio-economic benefits of the project at this point in time, particular care has been taken to design a fully-fledged social monitoring plan (see Monitoring Study). This will enable regular checks on social development and corrective action, if needed.

Proposals for Enhancement of Projects Socio-economic Values

The following proposals are forwarded to enhance the project's social impact:

34 Compensation of stakeholders and economic incentives * Potential losers from project activities, e.g. shepherds whose traditional grazing grounds get afforested, should get compensations from the project developer through project accompanying measures financed by the approved Japanese Grant of US$ 920,000 4. * Provide sufficient economic benefit to local communities already in the short term without jeopardizing the positive environmental and carbon benefits. A good balance between economic and environmental benefits will need to be found in order that forests will be kept by communities in perpetuity. * Be open for permitting grazing and collection of non-timber products in community as well as selected state forests. * Think about and then discuss with stakeholders possibilities to increase the financial and economic benefit for the rural poor on lands permanently transferred to Moldsilva.

Legal issues * Provide legal incentives by designing contracts which clearly defined future benefit- sharing mechanisms. * Scrutinize and revise forest code for allowing increased community and private sector involvement. * Allow for joint management of afforested lands transferred to the state (Moldsilva). * In the community forestry contracts, make tangible benefits conditional to the fulfillment of obligations such as plantation success (measured in a survival rate) and developing a community forestry plan and conflict resolution mechanisms. * Define and make public sanctions in case of non-compliance with contracts, in severe and repeated cases up to the expropriation of the community forests.

Institutional issues * Assist in building up of long-enduring community-based institutions in charge of forest management and conservation. * Support community-based institutions in defining rules and by-laws for comrnunity forests. * Strengthen institutional capacities of local councils and Moldsilva for joint forest management and social forestry.

4 The Japanese Grant Project will assist in making communal forestry and grazing more sustainable, and thus reduce encroachment on the community forests and in particular on the new forests that would be planted within the PCF Moldova Soil Conservation Project. The approach of the program would be as follows: Implementation Procedures and Eligibility. An outreach and education activity would target eligible farms in an information campaign designed to build awareness and support for the activity and provide instructions to farmers on how to apply to the SGP. The SGP would fund: (i) works and goods to be undertaken by the community and farmers associations to improve communal forestry and pasture management. Eligible communities would be those around the sites to be afforested under the Moldova Soil Conservation project. Successful applicants to the small grants would receive technical assistance, delivered through Moldsilva and agrarian technical institute. Farmers will co-finance the investments through donation of farm staff services to implement the activities. Activities to be Financed: The majority of the grant would be used for financial assistance to local communities for improved forest and pasture management. The project would finance forest pruning and thinning, and other costs associated with maintenance of community forests, costs of re-seeding and restoring degraded pastures (various measures for site preparation and pasture improvement), livestock watering sites, and fencing as needed to protect new forest stands and pastures under restoration. These activities will be based on participatory approaches and would fully involve local communities in implementing priority forest and pasture investments on the ground.

35 * Build larger management units for community forestry by organizing villages into larger groups. * Assist communities in setting up separate budget for forestry.

Beneficiaries * Clearly define and possibly limit the number of beneficiaries to a particular afforestation plot. In a subsequent step, certain user rights on a specific sub-plot could be allocated to individuals who would also be in charge of protection. * Require contribution in form of labor from villagers/beneficiaries. For sustainability reasons, do not fully pay villagers for plantation activities in community forests to increase the sense of ownership.

Private sector and NGO involvement * Allow for lease of community forests to private companies or user groups. * Involve local NGOs in the development and implementation of community forestry.

Employment generation * Use labor-intensive methods in order to generate employment. Due to the low wages, this can be justified also from a financial viewpoint. * Harmonize timing of afforestation activities with agricultural calendar.

Capacity building and technical assistance * Assist particularly possibly negatively effected livestock holders in improving livestock/ pasture management. * Develop and initiate integrated and participatory land-use planning in order to avoid land- use conflicts. * Train community members and farmers in community forest management and soil conservation.

Public awareness and information campaign * Increase environmental awareness particularly through on-the-job training and practical involvement in project activities. * Raise the interest of school pupils for forest conservation through participation in tree planting and environmental education activities. * Disseminate information about the project's objectives and progress in local media and in the Internet.

8.2 Biodiversity Impacts of the Project

Biodiversity Stratification of Project Forestation Units

The project includes 1,892 sites covering a total of 14,495 ha that are distributed throughout the Republic of Moldova. Of this total area, 5,400 ha were already afforested in 2002. The vast majority of these sites (93%) are less than 20 ha in area, including 78% that are between 1 and 10 ha. Sites that are 1 - 20 ha represent 68% of the total area of afforestation. Nevertheless, there

36 are 132 sites that are 20 - 120 ha, and while representing only 7 % of the total number of project sites, they account for 32% (4,684 ha) of the total afforestation area. While site by site analysis of all sites should ideally be undertaken to identify those most suitable for maximizing biodiversity benefits, it is safe to say that it is these larger sites that offer the greatest potential for enhancing biodiversity within the project's parameters. Thus, the primary focus of biodiversity maximization efforts will be on sites greater than 20 ha. in area. Of course, smaller sites will not be automatically excluded, particularly those encompassing wetlands and shorelines, and those sites that may have rare or endangered species. The focus on the larger sites is dictated by the fact that there exists more opportunity for the creation of habitat diversity, connectivity and sustainable results on the larger territories, as well as more practical considerations related to the overwhelmingly large number of sites included in the project. Focusing on the sites exceeding 20 ha leaves a more manageable total of 132 sites but still encompasses 4,664 ha (32% of the project area). Of the 132 sites that are greater than 20 ha, sites particular attention should be given to those that are not close to settlements. This will reduce the potential impacts associated with potential grazing, as well as picking, trampling, firewood collection, and disturbance of wildlife.

Potential Biodiversity Benefits and Hazards of Defined Ecological Forest Units

The afforestation of the project land units will result in a complex of biodiversity benefits. Vegetative cover will be increased using species that are appropriate for the location in question. The diversity of flora will be increased through the planting of over 20 native species of trees and shrubs. Grasses and other types of herbaceous vegetation will also reappear. This will provide greater structural diversity and an increase in the diversity of habitats available for native fauna. Faunal diversity will also increase correspondingly. The connectivity of habitats will potentially also be improved which will lead to increased species dispersal, greater ecological functionality of the sites, and in the longer term, stronger regional sustainability of biodiversity.

Expected net Biodiversity Effects of the Project Against the Baseline

The net biodiversity effects of the project against the baseline will all be positive over the longer term (i.e more than 5 years). Initial preparation of soil for planting will have a negative impact on what flora and fauna may be present on the sites. This impact will be temporary and will be reversed rather quickly as the plantings become established and come to support a greater diversity of flora and fauna. Initial project activities such as soil preparation may have a short term negative effect on soils and wildlife. These impacts will also be temporary. The planting of native species of trees and bushes will result in a positive impact as they become established and come to support a greater range of native fauna. The establishment of these "oases" of biodiversity will also provide for increased connectivity and species dispersal potential in the landscape and will help support ecosystem sustainability.

Measures to Enhance Biodiversity

The project includes 1,892 sites covering a total of 14,495 ha that are distributed throughout the Republic of Moldova. Of this total area, 5,400 ha were afforested in 2002. The vast majority of these sites (93%) are less than 20 ha in area, including 78% that are between 1 and 10 ha. Sites

37 that are 1 - 20 ha represent 68% of the total area of afforestation. Nevertheless, there are 132 sites that are 20 - 120 ha, and while representing only 7 % of the total number of project sites, they account for 32% (4,684 ha) of the total afforestation area. The larger sites offer the greatest potential for enhancing biodiversity within the project's parameters. Thus, the primary focus of biodiversity maximization efforts will be on sites greater than 20 ha. in area. Of course, smaller sites will not be automatically excluded from efforts to enhance bioidversity, particularly those that provide an opportunity to establish vegetative buffers along streamcourses and other water bodies. The focus on the larger sites is dictated by the fact that there exists more opportunity for the creation of habitat diversity, connectivity and sustainable results on the larger territories, as well as more practical considerations related to the overwhelmingly large number of sites included in the project. Focusing on the sites exceeding 20 ha leaves a more manageable total of 132 sites but still encompasses 4,664 ha (32% of the project area). Of the 132 sites that are greater than 20 ha, more attention will be given to those that are not close to settlements. This will reduce the potential impacts associated with potential grazing, as well as picking, trampling, firewood collection, and disturbance of wildlife.

In order to mitigate the project impact on biodiversity it is necessary to develop and implement a mix of approaches through which biodiversity benefits can be maximized in the context of the project's primary objectives. The guidelines below provide a basis for the development of a mix of approaches for the maximization of the project's biodiversity benefits both at the project site and landscape levels.

Site level guidelines

Increase species diversity - The selection of native species will be done in a manner that provides for a mix of species that are appropriate for a given biotope. In selecting the species, consideration will also be given to maximization of habitat and food sources for birds, mammals, reptiles, amphibians and invertebrates. In addition to tree species, the inclusion of shrubs that are appropriate for the location will result in the development of structural diversity. In turn, this will lead to the establishment of habitat for a greater number of species. Insectivorous birds, for example, will benefit from densely planted bushes with many branches. Some undergrowth species that attract insects are wild carrot, fennel, coriander and caraway. The establishment of herbaceous ground cover in clearings will be beneficial for ground nesting birds, insects, reptiles and amphibians. A mix of herbs and grasses will be planted to increase the diversity of invertebrates. In the interior of the sites, an accumulating organic layer will be important for soil organisms.

Increase habitat diversity - The sites will be afforestation using a mix of tree and shrub species that will contribute to establishment of more complex habitats than if trees alone would be used. On sites larger than 20 hectares, clearings will be left for the establishment of shrubs and grasses and promote habitat mosaics. Breaks between trees should be provided in places for the establishment of a flowering herbaceous layer as it is important for attracting and supporting pollinators. If possible, depressions that may become filled with water, even ephemerally, should also be created to further diversify available habitat and associated faunal diversity.

38 Increase connectivity to adjacent habitat - In cases where a site is in proximity to adjacent forest, a physical connection with the project site will be established using species that are the same as in the adjacent habitat. Reconnecting such project sites with larger adjacent habitat will provide for greater dispersal of species and will increase the area of functional habitat.

Landscape level 2uidelines

Contribute to ecological network development - A central feature of the country's National Biodiversity Conservation Strategy is the development of a National Ecological Network. The proposed network concepts are developed at the international level (Nistru River and Prut River valleys bordering Ukraine and Romania respectively), as well as at the national, regional and local levels. Sites that are situated in these proposed network corridors should be afforested in a manner that makes the greatest contribution to the network's development, at the given location.

Integrate with protected areas - Project sites situated in proximity to existing protected areas should be afforested in a manner that will maximize the complementarity of objectives. Project sites may be used to extend the protected areas' ecological functionality or as buffers. Only native species will be used on such sites, and the species selected will be complementary to those in the protected areas.

Specific areas

Wetlands and shorelines. Wetlands, including sites where ground water comes to the surface, are of particular significance because of their important ecological functions and because they are usually sites of high biodiversity value. They are also sensitive to disturbance. The planting of dense and thorny native vegetation is also recommended for such sites. This will serve the dual purpose of providing a variety of habitats and protecting the sites from intrusion and destruction. Shorelines are significant on account of their importance to numerous species. On sites that possess shoreline, a mix of species should be planted to provide cover and food sources for species. Any sites along the shores of the Nistru and Prut Rivers should be planted in a manner that considers their contribution to the international ecological network corridors being planned along them.

Ravines and gullies. Since such greatly disturbed areas will not be suitable for the planting of trees, and since over time they may have come to provide habitat for some species of fauna, they should be planted with native bushes and, if possible, herbs and grasses.

Steppe meadows. As practically no undisturbed steppe remains, it would be desirable to establish pockets of steppe vegetation where feasible. This would be particularly important in the Southern and Central Zones. Potential sources of restoration material may be found in the protected areas.

39 8.3 Soil Conservation Effects of the Project

Stratification of Project Forestation Units

For the purpose of soil conservation effects through the project it is recommended to use the same land-use and humus class based stratification as used to assess the soil conservation baseline scenario described in chapter Error! Reference source not found.. At present it is not known if the different tree and shrub species will also provide distinct soil conservation effects. If this should be detected during the project soil conservation monitoring, than a further stratification according to species classes should be considered. E.g. the soil conservation effect of nitrogen fixing but deciduous broadleaf species (Robinia, Gleditsia, Sophora) may be different to evergreen coniferous species (Pinus, Picea).

Potential Benefits and Hazards of defined Forest Units regarding Soils

Herbaceous and wood vegetation is the most important factor of protection and conservation of soil cover on slopes. An anti-erosion effect of forests and forest plantations is caused by the protection of crown foliage that effectively stops the impact of rain drops, that otherwise hit the unprotected soil, causing a break down of soil aggregates and the sealing of the soil surface (compare 0). Through the forest canopy the rain drops fall with much less energy and are then stopped again by bushes or herbaceous vegetation and finally by a well formed forest litter layer. Forest litter absorbs and keeps like a sponge a quantity of water four to five time higher than the equivalent mass of soil. Thus the infiltration capacity of water in forests are higher and water and soil losses are at their minimal.

The complex root system of trees, bushes and herbaceous vegetation contribute to the formation of granulated soil structure, increasing porosity and biological activity of soils, and as a result, increasing soil fertility.

Hang parallel tillage lines is a common standard in the site preparation. This will help to stop immediately much of the run off water that causes surface and rill or gully erosion downhill. In summary, the establishment of forest vegetation contribute to: * conservation of soils and relief forms, diminishing the erosion processes (superficial and depth erosion ) and landslides; * infiltration of water in soil and maintenance of favorable hydrologic regime of soils; * through organically depositions (about 3-5 t/year/ha) will increase the humus layer, with direct influence on soil fertility; * creation of intern climate regime (air and soil); * stop of erosion caused by winds; * regeneration of soil profiles; * bringing on the surface of new quantities of mineral substances absorbed by plant roots and included in small biological circulation; * activation of biochemical processes;

40 * contribution to increasing of soil productivity of adjoining agricultural lands (by 12- 15%). The following hazards have to be considered for soil conservation effects of the project planted forests: * Pure coniferous plantations without any broadleaf mixtures or shrub layer may cause a slow acidification of the soil. All plantations of larger scale of Pinus or Picea should therefore contain a certain fraction of broadleaf species; * Specially in the southern dryer parts of the country forest fires may occasionally occur. Here tree species that are able to survive and coppice after such fires (Quercus, Robinia, etc.) should be preferred and proper fire protection measures have to be included in the plantation design; * Forest canopy may be fairly open if an important number of trees should not grow well or die on adverse planting sites, due to calamities (insects, e.g.) or if thinning is not been done properly. Here replanting and monitoring may have to detect possible failures that should be corrected immediately;

None of the cited risks is considered to be either very high or not to be manageable with a careful project design, good monitoring and professional project implementation.

Expected net Soil Conservation Effects of the Project against the Baseline

All of the above potential benefits can be considered to be net benefits, as the soil conservation effects of the baseline situation are in fact negative and would lead to the steady deterioration of the sites, in absence of the planned forestry soil conservation project.

Proposals for Enhancement of Project Soil Conservation Benefits

For optimizing the soil conservation results of the project the following measures are proposed: * Strictly observe to draw the tillage lines along the isohyets; * Minimize the hazards through appropriate actions (refer to 0); * Give preference to silvicultural systems that create uneven aged forest structures, avoiding clear cutting; * Bring in grass or herb seeds (native species) to cover rapidly any open grounds; * Promote the growth of a second bush or tree stratum below the main canopy. * Synergies of these proposals with other project goals (e.g. environmental effects, profitability, carbon sequestration) should be employed as much as possible.

8.4 Other Environmental Effects of the Project

Water - The impacts on water will be positive and will be noticed in a raised water table, decreased run off and siltation of nearby water bodies, and improved drinking water quality.

Climate - Afforestation will have positive micro-climatic effects. Wind speed will decrease as a result of the sites acting as windbreaks. The temperature differential with adjacent lands will be moderated. The project will also result in the sequestration of some greenhouse gases,

41 particularly CO2 . If through alternative forestry income some families can afford to abandon the production of ruminants, this may result in a minor positive greenhouse gas reduction through the decreased release of methane.

Landscape - The new forests will add structural diversity to the landscape. The potential for increased connectivity among forest patches and a contribution to the development of an ecological network will also be positive effects. Afforestation will also result in the decrease of landslides and gully formation.

Table 11 summarizes and compares the short term and long term impacts of project activities on biodiversity and other environmental components. In the longer term (5 years and longer), all impacts will be positive.

Table 11. Short (ST) and Long Term (LT) Impacts of Project. Activity Impacts on the Environment Soils Water Climate Flora Fauna Landscape ST ST LT ST LT ST ST ST LT LT LT LT 1. Soil preparation -1 +2 -1 0 0 0 -1 0 -1 0 -1 0 2. Planting +3 +3 0 +1 +2 +2 +3 +3 +1 +3 0 +3 3. Maintenance 0 00 0 0 0 0 00 0 0 0 4. Replanting +1 +1 0 +1 +1 +1 +1 +1 0 +1 0 +1 5. Disease control -1 0 -1 0 0 0 -1 0 -1 0 0 0 6. Harvesting 0 00 0 0 0 0 00 0 0 0 7. Wood transport 0 00 0 0 0 0 00 00 0 With Project +2 +6 -2 +2 +3 +3 +2 +4 -1 +4 -1 +4 Without Project -14 -13 0 -8 0 -8

Likely potential project impacts without mitigation measures were evaluated on a scale from -3 to +3, where - 3 refers to major negative impacts, and +3 refers to major positive impacts. No road construction is planned.

8.5 Outlook on Project Contributions to Sustainable Development

The project contributes in various aspects to the sustainable development in Moldova: The project enhances the forest area of Republic of Moldova with 0.04 % (14,494 ha) by afforestation of eroded soils and unproductive lands in the coming 4 years. A large number of national strategies and laws support the afforestation of degraded lands and support the creation of wood resources: Law on rehabilitation of degraded lands by afforestation (1041 -XIV/June, 15, 2000), Land Act (no 350-XIV/July 12, 2001), Forest Act (law no. 887/June, 21, 1996), Strategy on Forest Fund Development and Strategy and Action Plan for Conservation of Biodiversity (no.1 12-XV/April 27, 2001), Strategy for sustainable development of Republic of Moldova, Law of waters (no. 440-XIII/ April, 27, 1995). As well the activities carried out under the Project contribute to other international commitments of the Republic of Moldova like the UN

42 Framework Convention on Climate Change, the Convention on Biological Diversity, or the Convention to Combat Desertification.

Sustainable development of forest sector of the Republic of Moldova foresees the extension of areas covered with forest vegetation. The forest policy goal for achieving better eco-protective functions is to extend the forests on 15% of the country area. For this purpose it is necessary to cover at least 130 thousand ha with forest vegetation and to create: * new forests and extend existing forests; * green islands of trees and bushes; * green corridors between the afforested areas; * forest protection belts along rivers, roads and around industrial objectives. To achieve these goals, priorities will be given in the project planning process to: * From territorial point of view - Southern judet of the Republic, that especially suffer from drought, soil erosion and lack of aquatic resources; * From the structural point of view - new forest bodies and conjunctive corridors among it, created mainly along the water courses, achieving at the same time more advantages, for example, soil protection, improvement of hydrological regime, biodiversity conservation; * From the functional point of view - forests with rapidly growth species, that will improve the provision of populations with fuelwood. For this purpose it is foreseen: * to afforest degraded lands, and those from the water protection zones, according to the legal requirements; * to transfer some areas from the private property in order to maintain the integrity of the forest net (the state will reimburse the losses to the landowners or will compensate them with other land).

9 Project Alternatives

The project has two alternatives.

Maintain status quo. The status quo is the continuation of overgrazing of the degraded project sites with minimal forage productivity for one to two months in the spring, and with continuation of the recent historical trend of degradation and erosion. The baseline rate of afforestation of around 400 ha per year would also continue (Table 12). The 'no project' option requires no incremental investment, which is attractive in light of the country's difficult financial condition, but would also continue to yield marginal social benefits and negative environmental consequences.

43 Table 12. Re-afforested and afforested area in Republic of Moldova in the period (1994- 2000) (ha)

Year Afforestation (on bare lands) 1994 826 1995 868 1996 617 1997 516 1998 564 1999 493 2000 443 Total 4327

Alternative land use options. A second alternative would involve improvements in agricultural uses of the lands including as pasture, for cultivated crops, orchards, and vineyards. However, many of the project sites have very marginal value for agriculture due to the presence of slopes and gullies, and because soil has been lost. The preliminary financial analysis assumes a price of carbon of $3.5/tCO2 and a discount rate of 10%. It was also considered costs of regeneration works for all rotations over 100 years (site preparations and soil cultivation, seedlings and establishments costs, maintenance till the canopy closure of plantation and current survey and works in the forest after canopy closure) in terms of actual prices and technology. As well, it was supposed lease for hunting, bee keeping, medicinal plants, etc The "with project" scenario has a low Internal Rate of Return (IRR) and Negative net Present Value (NPV). The carbon selling has a significant impact both on NPV and IRR. NPV modifies from some 5.650139 USD to 2.691937 USD after C selling. Meanwhile the IRR increases from 7 % to 8 %. However, before the sale of carbon, the Project would be more costly and less profitable than alternative, especially the business-as-usual scenario. After the sale of carbon, the ranking of options by NPV and IRR would be different. Accordingly the analysis has to be improved further in the context of the baseline study by associate value on at least some of the external benefits (ecological improvement) generated by the Project, and then re-calculating the NPV and IRR.

10 World Bank Safeguard Policies

The World Bank operates a series of safeguard policies (Table 13). The project has been classified as Category B under the Environmental Assessment (OP 4.0.1) safeguard policy. A project is classified as Category B if its potential adverse environmental impacts on human populations or environmentally important areas are less adverse than those in Category A.

44 'able 13. World Bank Safeguard Policies Environmental Assessment (OP 4.01) Natural Habitats (OP 4.04) Forestry (OP 4.36) Pest Management (OP 4.09) Cultural Property (OPN 11.03) Indigenous Peoples (OD 4.20) Involuntary Resettlement (OD 4.30) Safety of Dams (OP 4.37) Projects in International Waters OP 7.50) Projects in Disputed Areas (OP 7.60)

The safeguard policies that are applicable to this project are as follows:

* Environmental Assessment. The World Bank requires that Category B projects include an Environmental Assessment (EA) to identify likely impacts and an Environmental Management Plan (EMP) which includes mitigation actions and monitoring procedures together with opportunity for public consultation of the EMP and EA. This EA and EMP meet the Bank's requirements. * Natural Habitats. The project sites were selected for afforestation based on their degraded condition and the need to mitigate soil erosion and loss. The project sites consist of pastures, glades and abandoned arable lands (totaling 10,713 ha) and landslides, ravines, other degraded lands (totaling 3943 ha). * Forestry. The project is consistent with the Bank's new operational policy on forests. The project aims to reduce deforestation rates, enhance the economic contribution of forested areas, promote community participation and contribute to global public goods. The project is also consistent with (OP 4.36) through: (i) there is no conversion of natural habitats; and (ii) afforestation using non-native species will be designed to prevent and mitigate the potential of their spreading to natural habitats and adversely affecting native biodiversity. * Involuntary Resettlement. Afforestation of the project sites would reduce grazing, and thereby alter access by local shepherds. For this reason the Bank's safeguard on involuntary resettlement is triggered. This will be mitigated through the US$0.92 million grant for local communities. The issue is addressed fully in the social assessment.

45 11. Environmental Management Plan (EMP)

11.1 EMP Summary

The environmental management plan (EMP) consists of the summary of project impacts, the mitigation measures, monitoring, and institutional measures to be taken during implementation and operation to eliminate adverse environmental and social impacts, offset them, or reduce them to acceptable levels. Table 14 summarizes the project's positive and adverse impacts and Table 15 lists the mitigation measures, their implementation arrangements, and costs.

46 Table 14. Summary of Baseline Conditions and Project Impacts Issue Issue Description Mitigation Measure Number

A. Baseline (Without Project)

Biodiversity Floristic diversity of the project sites is much reduced in comparison to the historical (natural) baseline. At Not applicable the same time with the soil fertility decreasing, the majority of flora species are declining. Lands used is (N/A) mostly as pasture and perennial crops (about 15%) represent unbalanced ecosystems, that continue to degrade. Because of difficult conditions of life, the fauna diversity of the corresponding lands will continue to diminish, since will decrease the share of territories that could offer minimal conditions for animals, especially through decreasing of nutritive capacities of mentioned lands, lack of sites for reproduction and refuge. Game species such as wild boar avoid such lands. Soil conditions Currently about 85% of corresponding lands are degraded and practically excluded from general N/A agricultural production. Leaving these lands in actual state will lead to the extension of surfaces of ravines, landslides etc. Since the project sites are mainly on slopes above 7 degrees, erosion processes are proceeding quickly with annual losses of 50 t/ha of soil and 1.5 t/ha of organic matter, equaling 0.9 t/ha of carbon loss. Increased grazing with sheep, in the absence of proper grassland management, has the potential to accelerate soil erosion. The net impact on the soil conditions will be further decrease in soil fertility and a loss of soil due to erosion, ravines as well as further land degradation due to the landslides development. Soils have also will become drier and exhibit increasing the quantity of salt in soil. In the absence of any stabilizing and restorative measures, there will be continued soil loss and decreasing soil fertility. Water The continuation of soil erosion, ravines as well as landslides development, will have an impact on water N/A quality in the surrounding area, contributing to further water pollution. The water table will become lower in many places due to the progressive loss of vegetation. Eroded soils increased siltation and chemical pollution of the water bodies and wetlands thereby decreasing water quality and possibly contributing to the loss of fish spawning habitat and breeding habitat in wetlands. Landscape Actual condition of lands proposed for afforestation also diminish the aesthetic aspect of rural localities, national rural aspect, present a discommodity for all life environment of the population. In the less than 5 years, there will be little appreciable impact on the appearance of the landscape. Over a longer period of time, with the continued degradation and eventual forced abandonment even of the infrequently used pastures on account of the eventual exhaustion of their productivity, even more lands will become degraded.

47 B. Potential Impacts (With Project)

Biodiversity Biodiversity assessments were not carried out on all of the project's 1,891 sites during preparation. 1 to 8 Although the sites were selected for afforestation based on their degraded condition, biodiversity values are expected to be low or very low on all of the sites. However, site visits will need to be made for all of the sites to confirn there are no impacts to biodiversity. These will be carried out in the season prior to afforestation is planned.

Initially the soil preparation will have a negative impact on flora and fauna. This impact will be reversed over time as the forest becomes established and supports an increasing and diverse flora and fauna. The diversity of flora will be increased through the planting of over 20 native species of trees and shrubs. Grasses and other types of herbaceous vegetation will also reappear. This will provide greater structural diversity and an increase in the diversity of habitats available for native fauna. The connectivity of habitats will also be improved which will lead to increased species dispersal, greater ecological functionality of the sites, and in the longer term, stronger regional sustainability of biodiversity.

During harvesting, there is the potential to have a temporary negative impact on flora and fauna through the disturbance and possible displacement of fauna. Such impacts are generally temporary in nature, provided the harvesting operation is well planned and takes recognition of existing flora and fauna. The planting of non-native species, primarily Robinia pseudoacacia, Quercus rubra and Gleditsia, while understandable from a socio-economic perspective, it is not desirable from the native biodiversity conservation point of view. This is the reason why it is recommended planting native trees and bushes as much as possible. This will result in a positive impact as they become established and come to support a greater range of native fauna. The establishment of these "oases" of biodiversity will also provide for increased connectivity and species dispersal potential in the landscape and will help support ecosystem sustainability.

48 Soil conditions The soil cultivation (ploughing and disking) will have a short term negative impact on soils through the 2-4 increased erosion and release of soil carbon. In the long term the project will have a significant and lasting positive impact. Herbaceous and woody vegetation plays an important role in protection and conservation of soil cover on slopes. The establishment of forest vegetation contribute to: * conservation of relief forms, diminishing the erosion processes, the development of ravines and landslides, * infiltration of water in soil and maintenance of more favorable hydrologic regime of soils, * organical accumulation (about 3-5 t/year/ha) will improve soil fertility and regenerate soil profiles, * bringing on the surface of new quantities of mineral substances absorbed by plant roots and included in small biological circulation, * reduce wind erosion; . . * mitigate declining productivity of adjoining agricultural lands (by 12-15%). Water After an initial temporary negative impact of site preparation on water quality, the restoration of vegetative 2-4 cover will improve water quality as a result of decreased run off and siltation. Climate Afforestation will have positive micro-climatic effects. Wind speed will decrease as a result of the sites acting as windbreaks. The temperature differential with adjacent lands will be moderated. The project will also result in the sequestration of some greenhouse gases, particularly CO2. If through alternative forestry income some families can afford to abandon the production of ruminants, this may result in a minor DOSitive greenhouse gas reduction through the decreased release of methane Landscape The new forests will add structural diversity to the landscape. Increased connectivity among forest patches 5, 8 and a contribution to the development of an ecological network will also be positive effects.

49 Table 15. Mitigation Measures # Mitigation measures Phase Responsibility Financing 1. Biodiversity assessments should be carried out on all sites 1-5 SFE, Moldsilva years Moldsilva 2. Observe existing regulations for all afforestation activities: 1-5 SFE, Moldsilva (a) soil preparation; (b) planting; (c) maintenance and trees years Moldsilva protection; (d) thinning and harvesting 3. Where tillage is required for site preparation, use contour 1-5 SFE Moldsilva plowing methods to minimize soil impacts years 4. Use hydro technical installations where appropriate to 1-5 Moldsilva, Moldsilva, reduce erosion years MECTD, SFE, LA 5. Follow existing normatives to use indigenous species 1-5 SFE, Moldsilva, (trees and bushes); increase habitat diversity by providing years Moldsilva MECTD clearings for the establishment of shrubs and grasses 6 Create orchards and bushes overgrowth using Rosa 1-5 SFE Moldsilva canina, Prunus spinoza etc. as places for reproduction, years food, shelter for various fauna 7. Carry out tending activities (harvesting of wooden mass 5-15 SFE Moldsilva from the tending cuttings) in the periods less disturbing for years fauna (late fall and winter); 8. Where appropriate, use afforestation of native species to 1-5 SFE, Moldsilva, create forest linkages to enhance landscape level functions years LA MECTD of the forest fund 9. Systematically inform local authorities and communities 1-5 SFE Moldsilva about the project implementation, publishing and years MECTD, disseminating public awareness materials in order to get Japanese public support grant SFE - State Forest Enterprise Moldsilva - State Forest Agency Moldsilva; MECTD, - Ministry of Ecology, Construction and Territorial Development; LA, - Local Authorities.

11.2 Monitoring According WB OP 4.01, an environmental monitoring during project implementation provides information about key environmental aspects of the project, including achievement of the project's environmental objectives and monitoring the effectiveness of the EMP's mitigation measures. A monitoring sub-component is incorporated to monitor the soil and status of new forests. A summary of the proposed monitoring program is given below. It will be handled by the PMU in close cooperation with the MECTD, and the Forestry Enterprises and will be based on the baseline survey undertaken during preparation phase of the project

Monitoring will consist of recording the area that has been planted with trees and shrubs and their survival rate and the area of forest that has been improved through under/inter planting, encouraging regeneration better management.

50 Monitoring of all sites will take place in the Autumn of Years 1, 2, 3 and 4 and thereafter in the Autunm every 3 years. In the event of the necessity to implement disease control measures, monitoring will be required in the year of spraying, prior to the commencement of spraying and in the following year.

The monitoring of project biodiversity and other environmental effects will occur on three types of sites: "control" sites on lands adjacent to project sites so as to initially establish and subsequently monitor the baseline over time as opposed to conducting a one time or "snapshot" appraisal of the baseline; sites that will be afforested in a conventionalmanner (mostly the smaller 1-20 ha. sites); and, sites where an effort will be made to maximize biodiversity values (primarily the greater than 20 ha. sites). The actual project sites for monitoring will be selected on the basis of their representativity of their zone (Northern, Central and Southern) and land class (pastures and degraded lands).

24 monitoring sites will be established as follows.

For each of the 3 zones: * 1 representative pasture land project site that is less than 20 ha in area; * 1 similar control site on pasture land adjacent to project site; * 1 representative pasture land project site that is greater than 20 ha. in area; * 1 similar control site on pasture land adjacent to project site; * 1 representative degraded land project site that is less than 20 ha in area; * 1 similar control site on degraded land adjacent to project site; * 1 representative degraded land project site that is greater than 20 ha in area; * 1 similar control site on degraded land adjacent to project site.

For flora, a sampling design that is based on the systematic and permanent placement of fixed sampling plots and associated quadrates is likely the best approach to take. The corners of the plots and centers of the quadrates will be permanently identified and located by a set of Geographic Positioning System (GPS) coordinates. Metal bars may also be buried in the soil that could subsequently be found with a metal detector. In either case, the plots and quadrates will not receive differential treatment from forestry personnel, or other users of adjacent baseline plots in the future, a situation that would likely occur if they were to be marked above ground. Permanently marked linear transects will be established for monitoring fauna. Their ends should also be marked by GPS coordinates and buried metal bars. The transects should be of a length that traverses several habitat types, if these exist, on a given site. In such a case, they should run from the edge of a site into its interior in order to capture the greatest diversity of available habitats. In most cases, 100 m transects should suffice.

Due to the specialized nature of the monitoring expertise required, botanists, ornithologists, and other specialists will be required to assist forestry staff in conducting the monitoring field surveys. A monitoring table for biodiversity and soil conservation issues is provided (Table 16).

51 Table 16. Indicators and Procedures for Biodiversity and Soil Conservation Monitoring Indicator Adjustme Methodology/ Frequency/ Dates of Responsibility (Flow of) Cost of Progress Corre Indicator nts of Data sources evaluations Documentation evaluations or achieved ctive to be indicator means to date action measured required for baseline definition Increase in floral species Field surveys of Year 1, Year 2, Year Moldsilva forest Report to Moldsilva bears diversity in afforested project established 3, Year 5, and every 5 district (FD) Moldsilva; annual cost of sites monitoring plots years thereafter heads; report from personnel time; (spring and fall) contracted Moldsilva to PMU initial purchase expertise; PMU of 4 GPS units (US$ I ,000) Increase in faunal species Field surveys of Year 1, Year 2, Year Moldsilva FD Report to Moldsilva bears diversity in afforested project established 3, Year 5, and every 5 heads; Moldsilva; annual cost of sites monitoring linear years thereafter contracted report from personnel time transects (spring and fall) expertise; PMU Moldsilva to PMU Increase in faunal species Field surveys of Year 1, Year 2, Year Moldsilva FD Report to Moldsilva bears richness in afforested project established 3, Year 5, and every 5 heads; Moldsilva; annual cost of sites monitoring linear years thereafter contracted report from personnel time transects (spring and fall) expertise; PMU Moldsilva to PMU Change in soil density in Field surveys of Year 1, Year 2, Year Moldsilva FD Report to Moldsilva bears afforested project sites established 3, Year 5, and every 5 heads; Moldsilva; annual cost of monitoring plots years thereafter (fall) contracted report from personnel time expertise; PMU Moldsilva to PMU Increase of organic matter Field surveys of Year 1, Year 2, Year Moldsilva FD Report to Moldsilva bears layer and humus in afforested the carbon 3, Year 5, and every 5 heads; Moldsilva; annual cost of project sites monitoring years thereafter (fall) contracted report from personnel time expertise; PMU Moldsilva to PMU Decrease in rate and amount Field surveys of Year 1, Year 2, Year Moldsilva FD Report to Moldsilva bears of soil loss in afforested established 3, Year 5, and every 5 heads; Moldsilva; annual cost of project sites monitoring plots years thereafter (fall) contracted report from personnel time expertise; PMU Moldsilva to PMU

52 Monitoring of other Environmental Effects: Several indicators will be selected for the monitoring of other project environmental effects, including patch characteristics, nutrient cycling, water quality, temperature gradients, wind velocity, and others. However, for the sake of practicability and in view of the relatively high number of other monitoring indicators, including soil conservation and CO2 effects, it has been decided that these other environmental effect indicators (principally climate) may be of secondary importance and should therefore not be covered by the project monitoring system. The whole range of monitoring activities are presented in the Table 17.

Table 17. Proposed monitoring actions

Action and main index Responsible for Implementation period implementation I .Monitoringofforest vegetation SFA "Moldsilva" 2003 I.1. Evidence and mapping of all sectors included in the projects with the help of GPS and GIS. 1.2. Establishment of polygons for monitoring SFA "Moldsilva" 2003 effectuation 1.3. Supervision of observance of project SFA "Moldsilva" October 2002- statements concerning the assortment of October-November species, plantation scheme, number of plants 2005. per hectare, quality of soil preparation, quality of plantation material and activities during the plantations. 1.4. Supervision of observance of tending and SFA "Moldsilva" Starting with 2003 and growing technologies for forest species. up to 2016. 1.5. Check-up of technical reception and SFA "Moldsilva" Annual annual inventory of forest crops. 2. Monitoring of biologicaldiversity. 2.1. Identification of sectors representative for SFA "Moldsilva" Year 2003 biodiversity monitoring. 2.2. Establishment of methodologies for SFA "Moldsilva" Year 2003 monitoring of fauna and flora.

2.3. Identification of humid zones, of springs, SFA "Moldsilva" Year 2003 lakes, water basins and it mappings. 2.4. Effectuation of floristic monitoring SFA "Moldsilva" Year I, V, X and XV . On the base of routes through the sectors in different period of vegetation process; . Supervision of areas covered with exotic and indigenous species, its share in order to register the behaviour of those exotic species.

2.5. Effectuation of faunistic monitoring: SFA "Moldsilva" Year I, V, X and XV. * Entomofauna * Omitofauna * Rodents

53 . Mammals 3. Environmental monitorinig. SFA "Moldsilva" Year 2003 3. 1. Establishment of polygons representative for stabilization processes in soils. 3.2. Establishment of methodologies of SFA "Moldsilva" Year 2003 effectuation of monitoring of erosion and landslides process. 3.3. Monitoring of erosion processes: SFA "Moldsilva" Year V, X and XV . Superficial erosion * Linear erosion

3.4. Monitoring of landslides process SFA "Moldsilva" Year V, X and XV

11.3 Institutional Arrangements and Capacity Building

Moldsilva will be responsible for implementation for the EMP as part of its broader implementation responsibilities for the project. The general arrangements are as follows:

A. Project coordinatorwho will be responsible for coordinating project implementation and negotiations with the PCF;

B. Project Steering Committee with the general task of coordination of activities of all interested parties, including Ministries of Ecology, Finance, Economics, Agriculture, Environmental NGOs, local and regional authorities, academia. The Project Management Unit (PMU) would serve as the secretariat for the Committee. Among most important tasks of the committee would be also broad dissemination of the information about the project implementation, best cases and practices, coordination of the direct involvement of Moldsilva, local authorities and Ministry of Ecology in project financing, overall supervision of project implementation. Additionally the Committee would have the responsibility for the coordination of the implementation of the forthcoming PHRD grant;

C. Project Management Unit that will be responsible for day to day activities with regard to project implementation, and most important will be responsible for the implementation and coordination of the implementation of the project monitoring plan, including carbon sequestration and reporting.

The PM-U what is proposed to be created, will ensure the implementation of the EMP. The PMlJ will annually monitor and evaluate project progress and measure the impact of project activities against the baseline survey undertaken during project preparation. The PMU will undertake a systematic analysis of the impact and achievements of project activities and the results of the monitoring activities will be fed back into the implementation process as improved forestry practices. Concretely, the PMU will be responsible for the following:

* Provision of sustainability of the project afforestation activities through the more complete information, public awareness, strengthening of forestry management; * Project co-ordination; * Inventory and mapping of every sector with the use of GPS and GIS;

54 * Supervision of observance of projects stipulations, plantation technique and technologies. * Establishment of polygons and methodologies concerning the necessary measurements within the projects. * Carrying out of project monitoring at initial phase, and after that in year V, X and XV; * Verification of reception and annual inventories of plantations; * Preparation of annual reports; * Formulation of recommendations for re-addressing and improvements of works (reparation, maintenance, assurance of integrity etc.); * Preparation of recommendations concerning the management of new created communal forests; * Preparing and carrying out workshops, training within the project.

Prior to the start of the project, it is essential that the NFA staff at District level with responsibility for afforestation and monitoring are provided with training in environmental screening and other necessary for the project issues. The first training should be held before the end of year 2003 and the second before the end of January 2004. It is foreseen to organize separate courses for the forest staff: (a) at the inferior and average level (foresters and technicians); and, (b) at the superior level (engineer, chief forest engineer ). The following topics are needed to be included in these courses:

* National strategies and programs on the extension of the forest areas. * Extension of areas covered with forest vegetation - used technologies and techniques. * Dendrology of main forest species. * Environmental screening. * Forestry measures applied at tree growing in the conditions of the Republic of Moldova. * Forest legislation and technical norms concerning the responsibility of guard and protection of forest plantation. * Bio technical norms for development of hunting fauna in new created areas. * Work protection and safeguard techniques during the plantation activities, maintenance and combating. * Legislative stipulations and responsibilities on the correct use of preparations. * Technical methodologies of appraisal of success and transfer in the canopy closure phase.

All proposed activities will be financed by the Moldsilva itself and in kind contribution by the Local authorities. Additionally the Ministry of Ecology, Construction and Territorial Development will provide some resources, in particular for the biodiversity conservation enhancing and for increasing public awareness and participation. Lastly, a special Japanese grant that recently was approved for Community Forestry Development, would contribute specifically for strengthening forestry management at the local level and for public participation and awareness. The concrete amount of needed resources will be annually estimated and included in the Moldsilva's expences. Additional resources provided by the MECTD and Japanese grant will be allocated upon presentation by the PIU a special financial request and detailed action plan, what should be approved by the National

55 Environmental Fund Council and in the case of the Japanese grant, - after the approval of the grant documents and their approval by the Steering Committee.

12. Record of Consultations and Information Disclosure

12.1 Consultations and Information Disclosure in Moldova

Various stakeholders of the project have been consulted frequently. They were visited individually and in groups. Extensive consultative meetings were held during project preparation and the inputs of these groups have helped in the.outcome of project design. In the course of the project preparation there have been organized various meetings with the representatives from the following state institutions, academia and NGO community:

* Division of Agriculture and Ecology within the State Chancellery of the Republic of Moldova; * Representatives of the Ministry of Ecology, Constructions and Territory Development; * Ministry of Agriculture and Food Processing Industry; * State Agency for Geodesy, Cartography and Land Resources; * Soil Science Institute, Institute of Botany and of Zoology of the Academy of Sciences of the Republic of Moldova; * State Forest Enterprises; * Environmental NGOs; * Local communities, Mayors and Councils; * Districts administrations, including authorities responsible for environment protection, cadastre, agriculture.

During these meetings were also discussed the tasks of different stakeholders in project designing, as well as major related problems and opportunities. During May - June 2002, the State Forest Agency "Moldsilva" have organized 4 technical meetings with the participants from the state forest units (Chief forest engineers, engineers for forest regeneration and forest fund, etc); 6 working meetings with the representatives of the local public authorities (councils and judet prefecture, mayoralties, ecological zonal agencies, various services, etc.); I joint meeting with the representatives of the agency for Soil Relations and Cadaster.

At those meetings it were identified the role and the responsibilities of: (a) Mayoralties / landowners; (b) Forest enterprises; (c) The State Forest Agency; and (d) of the Agency for Land Relations and Cadastre in various activities dealing with the project development. The minutes of these meetings are presented in a special attached report ( see Annex B).

Draft information about the project itself and about its environmental impacts and mitigation measures were disseminated in Moldova as follows:

* The PCN has been presented at the Scientific Conference "Sustainable development of the forest sector of the Republic of Moldova", November, 22-23, 2003, Chisinau, Moldova.

* Information concerning the project has been published in the national local newspapers in every judet. Additionally were presented: (a) three information on the

56 TV information program "Messager" during the period spring-fall 2002; and, (b) two information on the radio program "Ecoterra" during the period of fall 2002-spring 2003.

* Various presentations on the PCN, project options and on the project preparation process have been made to the government officials since October 2002 and in particular to the Ministry of Environment, Construction and Territory Development (MECTD), Ministry of Agriculture, aind Ministry of Economics.

* The PCN, Term Sheet and draft Emissions Reductions Purchase Agreement have been discussed with government and MECTD, Ministry of Finance, and Ministry of Economics officials since March 2003.

* The information with regard to the project was disseminated at the meetings with the public local authorities, local councils and local communities during the period September 2002 -March 2003.

12.2 Consultations and Information Disclosure in the World Bank and PCF

Information disclosure at the WB.

* The PCN was presented to and approved by the PCF participants at the meeting of the UNFCCC parties in October 2002.

* The Environmental Assessment Report and Integrated Safeguard Data Sheet (ISDS) was posted at the World Bank's Info Shop on July 15, 2003. These documents will be publicly available and open for comment for a period of two months, between July 15, 2003 and September 15, 2003

12.3 Additional Planned Consultations and Disclosure

Consultations and information disclosure in Moldova. The EA report will be widely circulated to all interested parties for comments and inputs before finalization. Additionally it is also proposed that:

* The EA report will be translated and posted on the MECTD and Regional Environmental Center websites in first decade of July, 2003 (in Romanian) * The Environmental Management Plan (EMP) will be disclosed in the local press and on the MECTD and Regional Environmental Center websites in the Romanian language for 60 days before the Emissions Reductions Purchase Agreement (ERPA) can be signed (July 15, 2003). * A special article on the results of the project baseline study will be published in the Ministry of Ecology magazine in September 2003 (in Romanian). * A short summary of the project and its EA (up to three pages) will be published in Romanian and broadly disseminated to interested parties, - NGOs, academia and State Institutions.

57 * Moldova Forestry Institute commonly with the Biodiversity Office within the Ministry of Ecology will organize in earlier July a special project presentation, for all interested parties, emphasizing its environmental impacts, as well as its benefits and mitigation measures.

58