ALBANIA PRIVATE FORESTRY DEVELOPMENT PROGRAM Contract No. EPE-C-00-95-00127-00 ] THIRD ANNUAL REPORT October 1, 1997 through September 30, 1998 Submitted to: United States Agency for International Development Submitted by: Chemonics International Inc. October 1998 TABLE OF CONTENTS Acronyms 1 A. Introduction 3 B. Perspective on APFDP Year 342 C. Year 3 Progress 9 D. Intermediate Result 1: Improved Utilization of Forest and Pasture Resources on Private and Refused/Non-divided Lands 13 E. Intermediate Result 1.1: Reformed Policies Supportive of Forestry/Pasture Initiatives on Private and Refused/Non-divided Lands 14 F. Intermediate Result 1.2: Economically Viable and Ecologically Sustainable Land Use Practices Adopted by Individuals 15 G. Intermediate Result 2: Increased Decentralization and Sustainable Management of State Forests and Pastures 20 H. Intermediate Result 2.1: Enhanced Policy Environment for Transferring State Forests 21 I. Intermediate Result 2.2: Groundwork Laid for Sustainable Management of Transferred Komuna Forests and Pastures 22 J. Intermediate Result 3: Increased Public and Private Forestry Extension Capacity 25 K. Intermediate Result 3.1: Groundwork Laid for the Establishment of a Coherent and Dynamic Public Extension Organization 26 L. Intermediate Result 3.2: Increased Capacity of Public Organizations, NGOs and Private Suppliers to Provide Extension Services 27 M. Intermediate Result 4: Increase Number/Expanded Capacity of Enterprises Based on Non-timber Forest Products 29 N. Intermediate Result 4.1: Reformed Policies Supportive of Small-scale Forestry Related Business Initiatives 29 O. Intermediate Result 4.2: Improved Access to Market Information, Affordable Inputs and Credit 31 P. Intermediate Result 4.3: Improved Business Management and Technical Skills 33 ANNEX A APFDP YEAR 4 WORK PLAN 35 ANNEX B TRAINING: YEAR 2, 3 AND UPCOMING EVENTS FOR EVACUATION PERIOD 45 ACRONYMS APBSSP Association of Genetical Improvement and Seed/Seedling Production ACBA Albanian Cattle and Breeders Association ALT Adult Learning Training APF World Bank-funded Albania Forestry project APFDP Albania Private Forestry Development Program AUT Agricultural University of Tirana BG Botanical Garden COP Chief of party DDA District Directorate of Agriculture DDFS District Directorate of Forest Service DFS District Forest Service DGFP Directorate General of Forests and Pastures ES Extension specialist FAO Food and Agriculture Organization FPRI Forest and Pastures Research Institute FTC Field technical coordinator FTCC Field technical coordinator counterpart GOA Government of Albania GTZ German Agency for Technical Cooperation HPI Heifer Project International IDT Interdisciplinary team IR Intermediate result INSTAT National Statistics Institute LS Livestock specialist PRA Participatory rural appraisal MLG Ministry of Local Government MOAF Ministry of Agriculture and Food MOE Ministry of Education MOU Memorandum of understanding NAC U.S. National Agroforestry Center NGO Nongovernmental organization NN Nursery Network NTFP Non-timber forest product PCV Peace Corps volunteers 1 PRA Participatory rural appraisal PS Policy specialist PSC Policy specialist counterpart REC Regional Environmental Center SARA Support for Agriculture Restructuring in Albania SBS Small business specialist SME Small and medium enterprise SO Strategic objective SRI Soil Research Institute SRS Small Ruminants Station STTA Short-term technical assistance TOR Terms of reference TOT Training-of-trainers VAT Value added tax 2 THIRD ANNUAL APFDP REPORT A. Introduction Four major events significantly impacted the Albania Private Forestry Development Program’s third year of operation. First, the timing and focus of some APFDP year 2 activities shifted to year 3 due to the political and economic upheaval that of the first half of 1997. Project progress lagged somewhat during year 2 and, although the APFDP Albanian staff held the program on course to the extent feasible, some activities were not possible because of civil disorder, resultant travel restrictions, and the evacuation of expatriate staff. Although the country stabilized somewhat when an opposition political coalition won the elections held June 29, 1997, the economic situation, coupled with lack of government control, led to accelerated deforestation during much of 1997 and into 1998. Second, a mid-term evaluation of APFDP in October-November 1997 suggested substantially increasing APFDP involvement in developing small-scale enterprises in non-timber forest product- related activities, and turning its attention to field implementation. The Mid-term Evaluation Team also recommended that the program be extended for two additional “option” years. The team, contracted by Chemonics when travel restrictions were lifted in late 1997, found the program concept basically sound and judged that APFDP and the Government of Albania (GOA) had successfully addressed the major policy-oriented issues in private and decentralized forestry. Third, in November-December 1997, Albania’s new government embarked on a comprehensive planning process, aimed at developing short-, medium- and long-term strategies. As part of this process in the Ministry of Agriculture and Food (MOAF), the Directorate General of Forests and Pastures (DGFP) convened a Forest Sector Strategy Workshop on December 4-5 with support of APFDP and the World Bank-assisted Albania Forestry project (AFP). Participants from central government, District Forest Service (DFS) offices, the private sector and NGOs drafted lists of priorities for a future forest strategy in four key areas: private management of forests and pastures, local management of state-owned forest land transferred for komuna use, protection and management of forests by the state, and promotion of entrepreneurship in the forest sector. As a result of this workshop, the GOA requested APFDP assistance in drafting a forest strategy that would lead the MOAF/GFP into the 21st century. With APFDP assistance, a draft strategy was prepared in collaboration with several key GOA institutions, and is now being circulated for comment. Finally, just as the situation in Albania was stabilizing, travel restrictions were relaxed somewhat, and APFDP was getting back on the fast track—including recruiting a long-term social forestry advisor to replace the field technical coordinator1—the U.S. Ambassador ordered another evacuation on August 14, 1998. This order was a result of Islamic terrorist threats to U.S. personnel working in Albania. On learning of this evacuation, APFDP’s chief of party, then on home leave, came to Washington, D.C., in late August to begin developing an evacuation period work plan and provide for contingency management of APFDP, particularly in the event that the program be extended for the two option years. The extension was approved by USAID/W on September 24, 1998, and the chief of party immediately made plans to conduct a workshop with APFDP staff in Ohrid, Macedonia from 1 Choosing not to renew their contracts for personal reasons, APFDP’s long-term policy specialist, Linda Nielsen, departed on June 30, 1998, and the field technical coordinator, Erling Nielsen, departed on July 31, 1998, both before the evacuation order. To replace them, the mid-term evaluation recommended changing the long-term field technical coordinator position to a more “social forestry” rather than technical orientation. 3 September 28 through October 17, 1998.2 The workshop aimed to take care of outstanding project administrative issues; renew memoranda of understanding with relevant partner institutions; review progress in achieving Third Year Work Plan results; finetune the evacuation work plan; provide guidance and support to APFDP staff; and ascertain the feasibility and utility of establishing an APFDP “shadow” field office in Macedonia. This report draws heavily on input from APFDP staff during the Ohrid Workshop and on numerous weekly, monthly, quarterly and other APFDP reports produced during the past year. B. Perspective on APFDP Year 3 The political and economic upheaval of early 1997 continues to have serious consequences for the forestry and pasture sector. The desecration of forests continues, as do changes in the nature of ownership of land and livestock. Family and community resources for investing in silvo-pastoral improvements or business initiatives remain weak. The current evacuation status makes project management all the more difficult. Unavoidably, APFDP has had to accommodate these factors in its implementation. Yet despite these challenges, the program is more or less on track with Third Year Work Plan targets. While the absence of the chief of party, the proposed long-term social forestry advisor and certain proposed short-term consultants has delayed progress in certain areas (e.g., non- timber forest product business development, improved nut production, some policy reform areas and a more social forestry and integrated orientation), APFDP is nevertheless making significant progress. Most important perhaps, the GOA and APFDP together continue to develop a better understanding of and mechanisms to address the constraints facing the forestry sector. Detailed below are the factors that have affected the implementation of year 3 and will guide APFDP during the strategy design for year 4. B1. Lessons Learned B1a. Assume Government Uncertainty During APFDP’s first three years, the changing governments appointed five different ministers for the MOAF, four different directors for the DGFP, and