AFRICAN DEVELOPMENT BANK GROUP Forest Investment Program for Uganda REPUBLIC OF UGANDA CLIMATE INVESTMENT FUND FOREST INVESTMENT PROGRAM FOR UGANDA MINISTRY OF WATER AND ENVIRONMENT FOREST INVESTMENT PROGRAM FOR UGANDA Prepared by Lead MDB Support MDB MINISTRY OF WATER AND ENVIRONMENT 2nd May 2017 i Forest Investment Program for Uganda Table of Contents ABBREVIATIONS AND ACRONYMS .......................................................................................................... V FOREWORD .......................................................................................................................................... VIII ACKNOWLEDGEMENTS ........................................................................................................................... X UGANDA FOREST INVESTMENT PROGRAM SUMMARY ........................................................................ XI 1. NATIONAL AND FORESTRY SECTOR CONTEXT .................................................................................... 1 1.1 Country Context .................................................................................................................... 1 1.2 Uganda’s forestry sector ....................................................................................................... 6 1.3 Forest Investment Program for Uganda ............................................................................... 9 1.4 Forestry and National Development ................................................................................... 10 1.5 Synergies with REDD+ process and strategies .................................................................... 12 1.6 Synergies with Pilot Program for Climate Resilience .......................................................... 13 1.7 Stakeholders engaged during FIP preparation.................................................................... 13 2. POLICY AND INSTITUTIONAL FRAMEWORK ...................................................................................... 15 2.1 International policy regimes, conventions and commitments ........................................... 15 2.2 Forestry Policy, Legislation and Related Regulatory Frameworks ...................................... 15 2.3 Institutional mandates, roles and responsibilities in forestry sector ................................. 16 2.4 Assessment of sector performance and constraints .......................................................... 17 3. OPPORTUNITIES FOR GREENHOUSE GAS ABATEMENT .................................................................... 18 3.1 Uganda’s Vulnerability to Climate Change ......................................................................... 18 3.2 NDC contribution to emission reductions or avoidance / enhancement of carbon stocks 18 3.3 REDD+ priority options that will contribute to emission reductions or avoidance / enhancement of carbon stocks and NDCs ................................................................................ 19 4. CO-BENEFITS FROM FIP INVESTMENTS ............................................................................................ 23 4.1 Socio-economic co-benefits ................................................................................................ 23 4.2 Environmental co-benefits .................................................................................................. 24 4.3 Ecosystem co-benefits ........................................................................................................ 26 4.4 Forest sector governance and institutional capacity benefits ............................................ 27 5. COLLABORATION WITH PARTNERS ................................................................................................... 29 5.1 Multilateral Development Banks and other development partners .................................. 29 5.2 Civil Society ......................................................................................................................... 29 5.3 Private Sector ...................................................................................................................... 30 5.4 Community participation .................................................................................................... 31 6. IDENTIFICATION AND RATIONALE FOR PROJECTS TO BE CO-FINANCED BY FIP ............................... 32 6.1 Rationale for FIP .................................................................................................................. 32 6.2 FIP Objectives, outcomes and approach ............................................................................. 33 6.3 Investment projects and transformational changes ........................................................... 35 6.4 Project components and transformational change ............................................................ 42 6.5 Alignment of the investment projects with FIP criteria and the SPRC ............................... 52 6.6 Implementation arrangements ........................................................................................... 53 7. IMPLEMENTATION POTENTIAL WITH RISK ASSESSMENT ................................................................. 54 7.1 Potential for Success ........................................................................................................... 54 7.2 Risks and Mitigation Measures ........................................................................................... 55 ii Forest Investment Program for Uganda 8. FINANCING PLAN AND INSTRUMENTS .............................................................................................. 56 9. RESULTS FRAMEWORK ...................................................................................................................... 58 ANNEX 1: FIP INVESTMENT PROJECTS .................................................................................................. 60 ANNEX 2: STRATEGY FOR STAKEHOLDER ENGAGEMENT IN FIP FORMULATION ................................. 88 ANNEX 3: UGANDA’S REDD+ READINESS STRATEGY AND ACTION PLAN ............................................. 89 ANNEX 4: UNDERLYING CAUSES AND DRIVERS OF DEFORESTATION AND FOREST DEGRADATION IN UGANDA ................................................................................................................................................ 90 ANNEX 5: REPORT OF THE INDEPENDENT REVIEW OF THE FIP ............................................................ 91 ANNEX 6: LAND TENURE DEFINITIONS AND IMPLICATIONS FOR FIP ................................................. 113 ANNEX 7: POLICY, LEGAL AND INSTITUTIONAL FRAMEWORKS .......................................................... 115 ANNEX 8: FIP LOGICAL FRAMEWORK ................................................................................................. 119 ANNEX 9: STAKEHOLDERS ENGAGED IN FIP FORMULATION .............................................................. 120 ANNEX 10: RECORD OF STAKEHOLDER INPUTS INTO FIP ................................................................... 143 List of Tables Table 1: FIP Budget (million USD) ................................................................................................. xvii Table 2: FIP Results ......................................................................................................................... xx Table 3: FIP contributions to draft REDD+ Strategy ....................................................................... 10 Table 4: National commitments to the forestry sector ................................................................. 10 Table 5: FIP Outcomes IP1 ............................................................................................................. 43 Table 6: FIP outcome 1P2 .............................................................................................................. 46 Table 7: FIP outcome IP3 ............................................................................................................... 50 Table 8: Risks and mitigation measures ......................................................................................... 55 Table 9: Investment Plan (USD million) ......................................................................................... 56 Table 10: FIP Projects preparatory budget .................................................................................... 57 Table 11: FIP Results framework.................................................................................................... 58 List of Figures Figure 1: Status of forests in Uganda ............................................................................................. xiii Figure 2. Sources of GHGs in Uganda ............................................................................................ xiv Figure 3: Map of Uganda and location............................................................................................. 1 Figure 4: Uganda population (1911-2014) ....................................................................................... 1 Figure 5: Poverty headcount ratio in Uganda .................................................................................. 2 Figure 6: Primary energy demand in Uganda (2016) ....................................................................... 3 Figure 7: Projected demand for woody biomass energy in Uganda, 2015-2040 ............................ 4 Figure 8: Household vulnerability to climate change in Uganda