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Project Document for WP CHINA Gansuand Xinjiang PastoralDevelopment Project GEF Project Brief EastAsia and Pacific Region EASRD IDate: October21, 2002 --- Team Leader: Sari K. Soderstrom Sector Manager/Director: Mark D. Wilson Sector(s): Animal production (50%), Agricultural Country Manager/Director: Yukon Huang marketingand trade (25%), Agricultural extensionand Project ID: P065035 research(25%) Lending Instrument: Specific InvestmentLoan (SIL) Theme(s): Land management(P), Other environmentand naturalresources management (P), Rural markets (P) [Global SupplementallD: POIm~ Team Leader: Sari~d~om - Sector Manager/Director: Mark D. Wilson Sector(s): Generalagriculture, fishing and forestry sector Lending Instrument: Specific InvestmentLoan (SIL) (60%), Agricultural extensionand research(40%) Focal Area: G Theme(s): Other environmentand naturalresources Supplement Fully Blended? No management(P), Biodiversity (P), Land management(P), Other rural development--, (P), Climate change(S) , Project Financing Data --- [X] Loan [ ] Credit [ ] Grant [ ] Guarantee r ] Other: For Loans/Credits/Others: Amount (US$m): 10.50 Borrower Rationale for Choice of Loan Terms Available on File: [ Yes Proposed Terms (IBRD): Variable-Spread Loan (VSL) Front end fee (FEF) on Bank loan: 1.00% Total BORROWER 32.45 0.00 r--'/!:[2 .4 5 ffiRDI 45.77 20.50 66.27 GLOBAL ENVIRONMENT FACILITY 8.00 2.50 10.50 86.22 23.00 109.22 - Borrower/Recipient: PRC Responsible agency: GANSU PROVINCE, XINJIANG AUTONOMOUS REGION Ministry of Agriculture -Foreign Economic CooperationCenter -Livestock and Fisheries Project Division ContactPerson: Mr. Tang Zhishao Tel: + 861065003273 Fax: + 861064194578 Email: [email protected] OtherAgency(ies): Agriculture and Animal HusbandryDepartment, Gansu Province Address: I Qing'anLu, Lanzhou, China, 730030 ContactPerson: Mr. Li Guolin Tel: + 86 931 8452377 Fax: + 86 9318826287 Email: [email protected].([email protected] Animal HusbandryDeparment, Xinjiang Uygur AutonomousRegion Address: 23 Xinhua Nan Lu, Urumqi, China, 830001 ContactPerson: Mr. Salajidin Tel: + 86 991 2825645 Fax: + 86 991 2825645282 5645 Email: [email protected](Q),fm365.con I PO65035 Estimated Disbursements ( Bank FY/US$m): Email:[Total:Fax: - - A. Project Development Objective 1. Project development objective: (see Annex 1) Project Development Objective. The project development objective is to promote sustainable natural resource management through establishing improved livestock production and marketing systems that would increase the income of herders and farmers in the project areas. The proposed project would empower farmer and herder households in the project counties to better manage their grassland resources and improve forage and feed production on arable lands, thereby increasing their incomes through more efficient and quality focused livestock production, sufficient to generate marketable surplus to improve living standards. Establishment of improved livestock marketing systems in project counties would also increase the efficiency of the livestock production system and help raise the living standards of farmers and herders. Global Environmental Objective (see Annex 13) . The global environmental objective of the project is to mitigate land degradation, conserve globally important biodiversity, and enhance carbon sequestration, through promotion of integrated ecosystem management in the grassland, desert, and forest ecosystems of the Qilian Shan, Tian Shan, and Altai Shan mountain ranges in Western China. The global environmental objective would be achieved by implementing community based grassland management plans in selected project areas with high global biodiversity values; providing incremental investments for implementing grassland plans; and monitoring of grasslands habitats in selected pilot sites. 2. Key performance indicators: (see Annex 1) Achievement of the project objective would be monitored by key performance indicators: Increasing trend in average net income of participating project households relative to other households in the same township and county; Increasing trend in extent and location of grasslands under sustainable on-the-ground management; Participant perception and understanding of biodiversity conservation and catchment management impacts of their grazing management decisions; and Increasing trend in fine wool and mutton prices received by farmers'/herders’ participating in the project compared with other farmers/herders in the same township and county. Key indicators for monitoring carbon sequestration and biodiversity status include: (i) dry matter production, (ii) percentage of soil covered, (iii) cover of desirable species, (iv) botanical composition, (v) grass cover, and (vi) pasture management. B. Strategic Context 1. Sector-related Country Assistance Strategy (CAS) goal supported by the project: (see Annex 1) Document number: 25141 Date of latest CAS discussion : 2002/01/22 Country Assistance Strategy . The project is consistent with the Bank's overall Country Assistance Strategy (CAS) to the rural sector in China, to sustain rural income growth, while maintaining the natural resource base. The CAS aims to assist local governments to accelerate commercialization of agriculture, develop new income generating opportunities in interior provinces, develop new approaches to food security, promote better utilization of agricultural production, marketing and distribution resources, and support investment in non-state sector enterprises. Major CAS objectives which govern the Bank's - 2 - lending program to China's agricultural sector emphasize support for the development of integrated marketing systems for agricultural commodities in order to establish linkages from rural production areas to urban markets. The CAS objectives also emphasize the need to increase efficiency in livestock production and marketing through improvements in animal genetic potential, nutrition and production technologies, thereby generating higher-value livestock products. The project is also consistent with the CAS poverty alleviation objectives, supporting selected investments in environmentally sustainable agricultural and livestock development in the poorest regions of western China, where the incidence of poverty is the highest. Rural Strategy . In the rural sector, the focus of the Bank's overall assistance strategy to the rural sector in China is on the shift from subsistence production to commercial agriculture and from the quantity to the quality of production. The need of this shift in approach was emphasized in the joint China-Bank in depth analysis of China's rural sector ("Accelerating China's Rural Transformation," World Bank, Albert J. Nyberg, August 1999). The analysis emphasizes the need of taking an integrated approach to rural development which includes improved land and water use, diversified agricultural production with modern technology, and efficient marketing systems. The project concept is also fully in line with the three overarching goals of the Bank's rural development strategy as articulated in the "Rural Development: From Vision to Action" which are to: (i) enhance economic and social well-being of rural people; (ii) improve household food security; and (iii) ensure sustainable use of natural resources. The project would also promote the Bank's overall goal of poverty reduction under which China has been identified as one of the focal countries. Environment Protection Strategy . As reflected in the China CAS, protecting the environment is an overarching objective for support by the World Bank Group. The Project is consistent with the national Biodiversity Conservation Action Plan (1994) and the China’s Biodiversity – A Country Study (1998). The Action Plan identified the Tian Shan and Altai Shan regions in Xinjiang and the Qilian Shan in Gansu as priority ecosystems for conservation of biological diversity. 1a. Global Operational strategy/Program objective addressed by the project: Background . Grasslands cover about 40 percent (400 million hectares) of China’s land area, making China second only to Australia in the extent of its grassland resources. About 75 percent of China’s grasslands (300 million hectares) are found in the semi-arid pastoral areas in the north and west of the country. The majority of the grasslands are found in a few provinces/autonomous regions in the north and west; the most important of which are Gansu, Inner Mongolia, Qinghai, Tibet, and Xinjiang. Grasslands in the project areas have four global environmental values: (a) biodiversity; (b) forage plant and meat sheep agrobiodiversity; (c) carbon sink and (d) international river catchment. Global Operational Strategy . The project is consistent with three (biological diversity, climate change, and land degradation) of the six GEF focal areas (biological diversity, climate change, international waters, ozone layer depletion, land degradation, and persistent organic pollutants.) China ratified the Convention on Biological Diversity (CBD) on 5 January 1993, and the Convention to Combat Desertification (CCD) on 18 February 1997. The project responds to Conference of the Parties (COP) to the CBD guidance in that it promotes capacity building, conservation and sustainable use of natural resources through adoptive management of grassland landscapes and supports the objectives of international conventions. The project approach is in line with the Government of China's strategy for desertification control, prepared in-accordance with the UN Convention to Combat Desertification
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