Public Disclosure Authorized - EE543 World Bank/TACIS Joint Environment Programme Natural Resource Management and Poverty Reduction Project, Armenia: Draft Environmental Assessment Report January 2002 Public Disclosure Authorized Public Disclosure Authorized Environmental Resources Management 1730 K Street, NW, Suite 1300 Washington DC, 20006 Telephone +1 202 466 9090 Facsimile +1 202 466 9191 Public Disclosure Authorized Email [email protected] http:/ / www.erm.com World Bank/TACIS Joint Environment Programme Natural Resource Management and Poverty Reduction Project, Armenia: Draft Environmental Assessment Report January 2002 Reference 6536.13 For and on behalf of Environmental Resources Management Approved by: Signed: Position: Date: This report has been prepared by Environmental Resources Management the trading name of Environmental Resources Management Limited, with all reasonable skill, care and diligence within the terms of the Contract with the client, incorporating our General Terms and Conditions of Business and taking account of the resources devoted to it by agreement with the client. We disclaim any responsibility to the client and others in respect of any matters outside the scope of the above. This report is confidential to the client and we accept no responsibility of whatsoever nature to third parties to whom this report, or any part thereof, ismade known. Any such party relies on the report at their own risk. CONTENTS I INTRODUCTION I 1.1 INTRODUCTION 1 1.2 PROJECT BACKGROUND I 1.3 SCOPE AND OBJECTIVES OF THE EA 3 1.4 STUDY APPROACH AND METHODOLOGY 3 1.5 CONTENTS OF THIS REPORT 4 2 INSTITUTIONAL, REGULATORYAND POLICY FRAMEWORK 6 2.1 INTRODUCTION 6 2.2 POLIcY FRAMEWORK 6 2.3 LEGAL AND REGULATORY FRAMEWORK 8 2.4 INSTITUTIONAL SETTING 10 2.5 INSTITUTIONAL STRUCTURE FOR PROJECT IMPLEMENTATION 14 3 BASELINE ENVIRONMENT 18 3.1 INTRODUCTION 18 3.2 OVERVIEW 18 3.3 PHYSICAL AND BIOLOGICAL ENVIRONMENT 19 3.4 SOCIO-ECONOMIC ENVIRONMENT 23 4 PROJECTALTERNATIVES 25 4.1 INTRODUCTION 25 4.2 BACKGROUND 25 4.3 WITH THE PROJECT 25 4.4 No PROJECT SCENARIO 26 5 PUBLIC CONSULTATION AND DISCLOSURE 27 5.1 INTRODUCTION AND GENERAL APPROACH 27 5.2 CONSULTATION METHODOLOGY 27 5.3 PHASE I - INITIAL CONSULTATION 28 5.4 PHASE 2 - FORMAL DISCLOSURE 29 6 COMMUNITY BASED NATURAL RESOURCE MANAGEMENT COMPONENT 31 6.1 INTRODUCTION 31 6.2 COMPONENT DESCRIPTION 31 6.3 IMPLEMENTATION PROCESS 33 6.4 IDENTIFICATION OF ENVIRONMENTAL AND SOCIAL IMPACTS 35 ENVIRONMENTAL RESOURCES MANAGCEMENT WORLI) BANK / TACISJOINT ENVIRCONMENTALPROCRAM 99 6.5 ENVIRONMENTAL MANAGEMENT PLAN 40 6.6 IMPLEMENTATION RISK ASSESSMENT 55 7 STATE FOREST MANAGEMENT COMPONENT 58 7.1 INTRODUCTION 58 7.2 BACKGROUND 58 7.3 COMPONENT DESCRIPTION 59 7.4 SITE IDENTIFICATION AND IMPLEMENTATION PROCESS 61 7.5 IDENTIFICATION OF ENVIRONMENTAL AND SOCIAL IMPACTS 63 7.6 ENVIRONMENTAL MANAGEMENT PLAN 67 7.7 IMPLEMENTATION RISK ASSESSMENT 78 8 PROTECTED AREAS MANAGEMENT AND BIODIVERSITY CONSERVATION 81 8.1 INTRODUCTION 81 8.2 COMPONENTDESCRIPTION 81 8.3 INTENDED IMPACTS OF THIS COMPONENT 83 8.4 IMPLEMENTATION PROCESS 85 8.5 IDENTIFICATION OF ENVIRONMENTAL AND SOCIAL IMPACTS 85 8.6 ENVIRONMENTAL MANAGEMENT PLAN 90 8.7 IMPLEMENTATION RISK ASSESSMENT 94 9 ADDITIONAL RECOMMENDATIONS FOR PROJECT IMPLEMENTATION RISK MANAGEMENT 96 9.1 INTRODUCTION 96 9.2 INTEGRATION AND CO-ORDINATION OF PROJECTMANAGEMENT 96 9.3 ENSURING EFFECTIVE INVOLVEMENT AT THE LOCAL LEVEL IN PROJECT IMPLEMENTATION 96 ANNEXES ANNEX A MEMBERS OF THE EA TEAM ANNEX B LEGAL AND REGULATORY FRAMEWORK ANNEX C STRUCTURE OF KEY ORGANIZATIONS ANNEX D PUBLIC CONSULTATION AND DISCLOSURE MINUTES ANNEX E ENVIRONMENTAL MANAGEMENT GUIDELINES FOR CONTRACTORS ENvTRONMENTAL RESOuRCES MANAGEMENT WORLD BANK / TACISJOINT ENVIRONMENTAL PROGRAM 100 EXECUTIVE SUMMARY BACKGROUND This Category B environmental assessment (EA) report zoas commissioned by the World Bankfor the Natural Resources Managemenit and Poverty Reduction Project in Armenia (the NRMPR project) with supportfronz the Tacis Joint Environmental , r,;-r,i,,i (JEP). The EA report was prepared by Environmental Resources Management (ERM). PROJECT OBJECTIVES The project's development objective is to alleviate rural poverty and promote sustainable natural resource management practices in degradedhilly and mountainous areas of Northern Armenia in Gegharkunik and Tavoush Marzas. The project will help preventfurther deterioration of the natural resource base (soil, water, grasslands,forest and biodiversity) and stabilize the local economy. Key performance indicators or measures of project effectiveness will include: * Increased community participationin natural resource nmanagement decisions; * Increased crop and livestock productivity; * Increased extent and quality offorest and rangelandvegetative cover; * Increased household incomes in participatingcommunities; * Implementation of protected area management plansfor Dilijan Nature Reserved and Lake Sevan National Park; and * Itmproved biodiversity conservation of globally significantspecies. Performnance indicators measuringprogress towards achieving the biodiversity conservation objective include: (i) implementation of landscape-level watershed management plans linking protected areas and critical ecosystems; (ii) conversion of at least tulo protected areas (Dilijan Nature Reserve and Lake Sevan National Park) to effectively managed protected areas; and (iii) stabilizationof key tlhreatened ecosystemls and critical habitats in the project area. PROJECT COMPONENTS The project includes three main components which were addressed in this environmental assessment: * Community Based Natural Resources Management; * State Forest Managemtient, and * ProtectedAreas Management and Biodiversity. PROJECT IMPACTS The NRMPR project objectives are to achieve a range of positive environmental and social impacts, and thze components of the project have been designed to enhance thle ENIIRONN2ENTALRE>OURCFESNIANAGEhIENT WIORLDBANK/ TACI5JOINT ENVIRONMENTALPROGRAM positive outcomes and to also include mitigation measuresfor possible adverse or negative impacts. Hence, the EA process involved a secondary assessment of possible impacts, both positive and negative, as well as an assessment of the proposed enhancement and mitigation measures. When possible,further enhancement measures were identified. The major, expected positive and potential negative impacts identified in the EA are summarized in the boxes below. The primary major impacts are not individually significant but have the potential to be cumulatively significant. The main mitigation measures are increasedinstitutional and management capacity, and the project components incorporate these miitigation measures. Box 1 Intended PositiveImpacts Comm Bi" SNa.ftza . -l 1 Community forest management Increased understanding of forest conservation needs. Biodiversity conservation of forest buffer zones, pastures and arable land. * Establish multi purpose indigenous species in forest buffer zone. * Reduction of pressure on pasture land. * Provide sustainable wood and non-wood products, and alternative energy sources to wood leading to conservation of forest habitats. * Provide short and long-term income generating opportunities. Promote sustainable management practices and raise environmental awareness 2 Community pasture management * Increased food security * Long-term income generation. Provide short and long-term income generating opportunities. * Stop further degradation of soil resources (forest, arable and grazing lands) leading to increased soil fertility and a reduction in watershed sediment yield/erosion. Promote sustainable management practices and raise environmental awareness. 3 Sustainable agricultural practices * Increased food security * Increased opportunities for cash or barter income. Improved productivity will reduce pressure on marginal areas. Halt decline in soil fertility 4 Community infrastructure and income generation Increase cash surplus available for re-investment in sustainable agriculture practices Increased productivity will reduce pressure on marginal areas Increase food security Help to realize non-timber forest values Reduction in erosion caused by poor management of water resources Pasture improvement leading to reduced erosion, increased fertility, increased carrying capacity, biodiversity preservation. 5 Development of community institutions Establishment of resource user groups and village watershed management board Strengthening the capacity of exiting community and marz level organizations Community awareness State Fortst Magaemqnt. 1 Sustainable forest management practiced in selected pilot areas on state forest land ENVIRONMENTAL RESOURCESMANAGEMENT WORLD BANK / TACIS JOINTENVIRONMENTAL PROGRAM 11 Avoid cumulative environmental impacts of forest production and rehabilitation activities (e.g. soil erosion, sedimentation of watercourses, biodiversitv loss). Enhance biodiversity conservation and sustainable ecosystem management in forest and grazing lands. Employment opportunities in road construction, workforce programs, rehabilitation activities etc. Alleviate the rapid degradation of forest resources. Reduction in environmental impacts of existing road construction practices. Carbon sequestration. Increase contribution of forests to the state budget. Reduction in illegal activities related to forests. Recreational and amenity value of land increased. 2 Legal, institutional, policy and human capacities for sustainable forest management, biodiversity conservation and poverty