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Environmental and Social 104763 REV Public Disclosure Authorized Hebei Air Pollution Control Program (P54672) Environment and Social Systems Assessment (ESSA) Public Disclosure Authorized Public Disclosure Authorized April 2016 Prepared by the World Bank Public Disclosure Authorized Acronyms AAQM Ambient Air Quality Monitoring APPCAP State Council Air Pollution Prevention and Control Action Plan AWS Administration of Work Safety CEM Continuous Environmental Monitoring DHURD Department of Housing and Urban-Rural Development DLI Disbursement – Linked Indicators DOA Department of Agriculture DOC Department of Commerce DOF Department of Finance DRC Development and Reform Commission EIA Environmental Impact Assessment EPB Environmental Protection Bureau EPL Environmental Protection Law ESSA Environmental and Social System Assessment GoC Government of China HAP Hebei Air Pollution Prevention and Control Implementation Action Plan HAWS Hebei Administration of Work Safety HPC Hebei People’s Congress IPF Investment Project Financing JJJ Beijing- Tianjin-Hebei JJJAP Beijing- Tianjin-Hebei Action Plan LGO Leading Group Office MEP Ministry of Environmental Protection MOFCOM Ministry of Commerce NPC National People’s Congress PforR Program for Result PSD Public Security Department RAP Resettlement Action Plan ROC Regional Operations Committee SA Social Assessment SAWS State Administration of Work Safety SC State Council SCAP State Council Air Pollution Prevention and Control Action Plan VOC Volatile Organic Compound YSVLG Yellow-Sticker Vehicles Leading Group Table of Contents EXECUTIVE SUMMARY ........................................................................................................................ 1 SECTION I: INTRODUCTION ................................................................................................................ 3 1.1 Background ........................................................................................................................... 3 A. National Context .................................................................................................................. 3 B. Technical background ......................................................................................................... 4 C. Hebei Provincial Context ..................................................................................................... 4 1.2 Objectives and Scope of the ESSA ...................................................................................... 8 1.3 Methodology ......................................................................................................................... 9 SECTION II: PROGRAM DESCRIPTION .......................................................................................... 10 2.1 Program Contents .............................................................................................................. 10 A. Hebei Pollution Prevention and Control Implementation Action Plan (HAP)............. 10 B. Hebei Pollution Prevention and Control PforR (the “Program”) ................................. 11 2.2 Institutional Arrangement for Implementing the Program ........................................... 16 SECTION III: POTENTIAL ENVIRONMENTAL AND SOCIAL EFFECTS ................................ 17 3.1 Environmental and Social Screening ............................................................................... 17 3.2 Potential Environmental Benefits and Risks ................................................................... 18 3.3 Potential Social Benefits and Risks ................................................................................... 20 SECTION IV: ASSESSMENT OF ENVIRONMENTAL MANAGEMENT SYSTEM ................... 22 4.1 Legal Framework Applicable to the Program ................................................................. 22 4.2 Implementation of Environmental Management system ............................................... 29 4.3 Performance of Environmental Safeguards Management Agencies and Capacity ..... 35 SECTION V: SOCIAL MANAGEMENT SYSTEM AND PERFORMANCE ASSESSMENT ...... 43 5.1 Social management system ............................................................................................................. 44 5.1.1 Social Management System for ssubsidizing the elimination of yellow-sticker vehicles 44 5.1.2 Social Management System for Rural Non-Point Source Pollution Control ................ 46 5.1.3 Social Management System for Development of Regulations and Policies ................... 47 5.1.4 Policy System Governing Land Acquisition .................................................................... 48 5.1.5 Management System for Ethnic Minority Development ................................................ 57 5.1.6 Management System for Ethnic Minority Development ................................................ 58 5.2 Assessment of Social Management System against PforR Policy and Directive .......... 62 SECTION VI: SUMMARY OF ASSESSMENT OF ENVIRONMENTAL AND SOCIAL SYSTEMS .................................................................................................................................................. 63 SECTION VII: STAKEHOLDERS CONSULTATION ....................................................................... 72 SECTION VIII: RECOMMENDATIONS ............................................................................................. 74 Annex 1. List of Applicable Environmental and Social Law, Regulations and Guidelines ............... 76 Annex 2: Subsidy Rates of Cities in Hebei Province for Eliminating “yellow-sticker” Vehicles ...... 82 Annex 3: Process Flow Chart for Subsidizing “yellow-sticker” Vehicles ........................................... 85 Annex 4: Latest Block Prices for Land Acquisition in Prefectural-level Cities of Hebei ................... 86 Annex 5: Staff Arrangements of Departments Responsible for Eliminating “yellow-sticker” Vehicles in Hebei ....................................................................................................................................... 90 Annex 6: Minutes of Public Consultation Meetings............................................................................... 92 II EXECUTIVE SUMMARY Environmental and Social Effects of the Hebei Air Pollution Control Program (Program) 1. This is a Program for Results (PforR) lending operation. Implementation of activities under the Program will rely on the existing national and provincial legal framework and institutional systems that the counterpart uses to manage environmental and social safeguards issues. The purpose of this Environmental and Social System Assessment (ESSA) is to provide a comprehensive review of relevant environmental and social safeguards systems and procedures in China and Hebei Province, identify the extent to which the national and provincial systems are consistent with the PforR Bank Policy1 and the PforR Bank Directive,2 and recommend necessary actions to address eventual gaps as well as opportunities to enhance performance during implementation. 2. The assessment concluded that, in general, China’s rules and regulations are consistent with the Bank PforR policy and Bank PforR Directive, but the capacity to effectively enforce certain regulations could be improved at some agencies. Thus, several recommendations are made to address these shortcomings and are included in the Program Action Plan or disbursement linked indicators. 3. The overall environmental and social risk rating of this Program is considered moderate. Environmental and Social Benefits 4. As an environmental pollution control operation, the Program will positively contribute to reducing air pollution emissions and enhancing environmental monitoring and management capacity in Hebei Province. The activities to be supported under the Program will contribute to the achievement of the objectives in the Hebei Air Pollution Prevention and Control Action Plan (HAP). Therefore, the Program is expected to have significant positive benefits of environmental quality improvement and public health. 5. The Program will contribute to significant social benefits for Hebei through air quality improvement, especially: (i) achieving sustainable socioeconomic development; (ii) enabling residents to breathe fresh and clean air, improving people’s health, mitigating risks of diseases due to air pollution deterioration, reducing disease-related expenditures and productivity losses, and improving the quality of life; and (iii) contributing to increasing living standards. Environmental and Social Risks 6. Some activities supported under the Program may have limited adverse environmental or social impacts if not well-managed. These include: (i) inadequate waste management and vocational health and safety support in the industrial enterprises with installation/operation of desulfurization, denitrification and dust removal facilities; (ii) inadequate licensing of livestock waste management facilities by farmers and lack of skills for using new technologies for rural non-point source pollution management; (iii) elimination of yellow-sticker vehicles used for private business may lead to some loss of income for their owners, and vehicles may be improperly disposed of in dismantling enterprises that do not conform to China’s Regulations; and, (iv) potential down-stream environmental and social impacts of new laws, policies and regulations. 1 OPCS5.04-POL.01 2 OPCS5.04-DIR.01 1 Consultations and Information Disclosure 7. The Bank organized a multi-stakeholder
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