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PERU
Participatory Management of Protected Areas
Project Appraisal Document
Latin America and Caribbean Region
LCCPE
Date: July 12, 2002 / Team Leader: Pierre WerbrouckCountry Manager/Director: Isabel Guerrero / Sector Manager/Director: John Redwood
Project ID:PO68250 / Sector(s): VI – Environmental Institutions, VM – Natural Resources Management
Theme(s): Environment
Focal Area: B – Biodiversity / Poverty Targeted Intervention: N
Project Financing Data
[ ] / Loan / [ ] / Credit / [X] / Grant / [ ] / Guarantee / [ ] / Other
For Loans/Credits/Others:
Total GEF Financing (US$M): 15.14 (including a GEF Block-B of US$340,000)
Financing plan: Source Local Foreign Total
GOVERNMENT OF PERU (INRENA) / 0.74 / 0.00 / 0.74
GLOBAL ENVIRONMENT FACILITY / 11.03 / 3.77 / 14.80
GOVERNMENT of the NETHERLANDS / 3.65 / 0.80 / 4.45
GOVERNMENT of GERMANY (KfW, Parallel Financing) / 6.13 / 0.68 / 6.81
ENDOWMENT FUND DONORS (incl. FINLAND) / 0.00 / 3.00 / 3.00
BENEFICIARIES / 0.91 / 0.00 / 0.91
Total: / 22.46 / 8.65 / 30.71
Borrower/ Recipient: PROFONANPE
Responsible agency: PROFONANPE
Address: 722 Prolongación Arenales, San Isidro, Lima, Peru
Contact Person: Alberto Paniagua, Director
Tel: 51-1-441-58702121010 Fax: 51-1-2121011441-8385 Email:
Estimated Disbursements (GEF FY/US$ Million)
FY / 2003 / 2004 / 2005 / 2006 / 2007 / 2008 / 2009
Annual / 42.2 / 2.0 / 2.0 / 3.0 / 2.0 / 2.01.4 / 1.60.2
Cumulative / 42.2 / 46.2 / 68.2 / 119.2 / 1311.2 / 1413..62 / 14.8
Project Implementation Period: From March October 20032 to February September 20098
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A. Project Development Objective
1. Project development objective: (see Annex 1)
The project’s development objective is to ensure biodiversity conservation by (i) increasing the involvement of civil society institutions and the private sector in the planning and sustainable management of five protected areas (PAs) of the Peruvian System of Natural Protected Areas (SINANPE), and one PA to be created during project implementation; and (ii) to obtain additional financial sustainability for the financing of recurrent costs in SINANPE.
The six PAs are: Tambopata-Candamo National Reserve, Bahuaja-Sonene National Park, Salinas and Aguada Blanca National Reserve, Huascarán National Park, Manglares de Tumbes National Sanctuary, and Abanico de Morona Pastaza. The PAs were selected using the following criteria: (i) biological diversity; (ii) socioeconomic importance; (iii) imminence of biodiversity threats; (iv) management needs; (v) degree of ongoing participatory management; and (vi)likelihood of involving civil society and the private sector (see Annex 7).
The project will build upon the experience gained during first GEF Grant to the Peruvian National Trust Fund for Protected Areas (PROFONANPE), supporting the Trust Fund's establishment and the development of its capacity to generate and attract new financial resources for conservation. On the basis of the first GEF trust fund and other projects, PROFONANPE has ensured the regular and long-term funding of the basic operational costs of ten PAs and investment in twelve.
The global objective of the project is to contribute to the conservation of biodiversity of global importance. Peru, in terms of its total number of species, levels of endemism, and range of habitats, is considered to be one of the world’s great centers of biological diversity. Despite a series of field inventories estimated to cover only two-thirds of the national territory, Peru has already been classified as one of earth’s seventeen mega-diverse countries[1]. In terms of species, Peru leads the world in numbers of butterflies, orchids, and endemic invertebrates. It also accounts for a total of 460 mammals and 1705 bird species, or 10 and 19 percent, respectively, of the world's total. As an indicator of its habitat diversity, Peru has been documented to have more life zones than any other country on earth with 84 of the world’s 110 life zones identified in Holdridge’s Life Zones System[2]. In terms of its agro-biodiversity, the country is considered to be one of the five world centers of origin of cultivated plants and has an immense natural germplasm resource of useful wild species[3]. In part, this rich endowment can be attributed to Peru’s 675,000 km2 of Amazon rainforest (including the Peruvian and Bolivian Yungas), the largest continuous forest on earth representing 40 percent of all remaining tropical forests of the world. Other major eco-regions include the country’s central Andean and Wet Puna, the Sechura Desert, the Tumbes Mangroves, and others.[4]
The financial sustainability will be increased by an additional endowment of US$6 million to the PROFONANPE protected areas endowment funds which will allow and additional US$250,000 per year for recurrent cost financing. A management strategy for long-term financing of SINANPE has been under preparation and will (to be completed byat appraisal. This strategy) will help to define the most appropriate channel for these resources.
2. Key performance indicators: (see Annex 1)
· Increased management effectiveness in six PAs.
· Reduced illegal activities threatening biodiversity conservation objectives in the six selected PAs.
· Reduced number of non-sustainable development activities in PA buffer zones.
· Increased indices of biodiversity richness in six PAs.
· Increased stakeholder participation in the management of six PAs.
· Increased capacity to finance SINANPE recurrent costs
B. Strategic Context
1. Sector-related Country Assistance Strategy (CAS) goal supported by the project: (see Annex 1)
Document number: CAS ID: 16796 PE Date of latest CAS discussion: June 26, 1997
The proposed project is consistent with the World Bank’s current Country Assistance Strategy (CAS) for Peru, which aims at reducing poverty in the context of sound environmental management. The proposed project supports the CAS objectives by enhancing sustainable management of the protected areas and by supporting economically and environmentally sustainable activities in five PA buffer zones, which is expected to achieve a lasting impact on poverty reduction. TheA FY20032002 CAS has been is prepared, and is scheduled to go to the Board in September 2002. The objectives of the 2003 CAScurrently under preparation with the are emphasis on poverty alleviation, environmentally sustainable growth, a annd institutional development. From this point of view, tThe project is even better aligned to the 20023 CAS, which specifically includes this projects in the chapter related to the environment and sustainable growth. The CAS includes also a proposal to consolidate the Peru GEF Investment Strategy, that already exists in draft formrelated to the development of environmental institutions (including INRENA and PROFONANPE) as well as the participation of beneficiaries in their own development.. By CEO endorsement the new CAS will have been presented to the Board.
1a. Global Operational Strategy/Program Objective Addressed by the Project:
Operational Programs
The proposed project is fully compatible with objectives defined for the GEF Operational Programs for: (i) Coastal, Marine, and Freshwater Ecosystems (OP 2) by supporting, through conservation activities, the functions of freshwater and coastal ecosystems at risk; (ii) Forest Ecosystems (OP 3), in promoting in situ protection of primary/old growth and ecologically mature secondary forest ecosystems; and (iii) Mountain Ecosystems (OP 4), in promoting conservation activities in sub-alpine, mountain grasslands, and/or mountain forest zones. The project is also consistent with all of the aforementioned OPs by: (i) promoting closer integration of the communities located adjacent to project-supported PAs in the conservation and management of biodiversity by increasing their participation in the management of the respective protected areas; (ii) facilitating the adoption of sustainable productive activities among inhabitants of buffer areas, consistent with core area conservation objectives; and (iii) increasing capacity among relevant local institutions including civil society and the private sector.
Agenda 21
The proposed project is fully consistent with and responsive to the relevant principles established under Agenda 21. Specifically, these are: conserving biological diversity (Chapter15), promoting sustainable agriculture and rural development (Chapter 14), strengthening the role of NGOs as partners in sustainable development (Chapter 27), providing support to local authorities’ initiatives to support Agenda 21 objectives (Chapter 28), facilitating new and innovative sources of financing to support the conservation of biodiversity (Chapter 33), and promoting education, public awareness and training (Chapter 36).
National Communication to the Conference of the Parties of the Convention on Biological Diversity (CBD COP)
The project is consistent with Peru’s first report to the Fourth Meeting of the Conference of the Parties (COP IV) to the CBD and the principles of the Convention, to which Peru is a signatory. It will support three levels of biodiversity (ecosystems, species, and genes) through three GEF Operational Programs within the biodiversity focal area. The project further supports COP Decisions I/8, II/8, I/9, III/9, III/10 and III/12, and Recommendation I/3 of the Subsidiary Body on Scientific, Technical, and Technological Affairs (SBSTTA) of the CBD.
Clearinghouse Mechanism (CHM)
The proposed project is supportive of the objectives of the CBD's Clearing House Mechanism (CHM). During implementation, project activities would facilitate provision of access and sharing of biodiversity-relevant information. This would occur primarily through: (i) developing and strengthening national capacity to manage and conserve biodiversity; (ii) developing and providing information in support of national and thematic biodiversity reports called for under the CHM; and (iii) promoting increased awareness of the importance of biological diversity conservation. The information generated will also be shared with the proposed GEF-supported "Inter-American Biodiversity Information Network" (IABIN) project via the CHM.
2. Main sector issues and Government strategy:
Sector Threats and Constraints
Despite the global importance of the country’s vast biodiversity endowment, this richness is increasingly at risk. Peru has an estimated 222 species in the process of extinction, including 81 aquatic species. Within South America, only Brazil has more threatened flowering plants. This accelerated loss of biodiversity is fundamentally the result of unsustainable human activities, among them deforestation, soil erosion, water pollution and illegal trade in wildlife and plants. Mining and oil exploration are major economic activities which generally contribute to the loss of biodiversity when executed without proper environmental standards. Major threats include:
· Deforestation. Tropical deforestation in Peru’s Amazon region has averaged approximately 300,000 ha per annum over the period 1985 to 1998. At this rate, by 2005 an additional 2.36 million ha would have been lost. The loss of natural forests is also a growing problem in the country’s 2.6 million ha of dry forest located in the Northwest Coastal region;
· Soil Erosion and Loss of Soil Fertility. An estimated 30% of Peru’s national territory is under moderate to severe erosion problems;
· Illegal Wildlife Trade. Illegal trade, particularly in Peru’s tropical forest-based wildlife populations and plant species, is also a significant cause of loss of biodiversity; and
· Water Pollution. Domestic and industrial sources of pollution, both legal and illegal, contaminate fresh and coastal/ near-shore waters, resulting in large-scale animal and plant loss and habitat degradation. Major sources of industrial contamination include wastewater associated with mining and fishmeal, among others.
One of the principal forces driving many of the aforementioned threats is the combination of population growth and migration trends, changing demographics, poverty, and the absence of land security, particularly in rural areas. Several studies have demonstrated that increased population pressure, coupled with acute land and capital shortages, have contributed to unsustainable land use practices in the buffer zones of many PAs which are increasingly threatening the latter’s core areas.
Major identified constraints affecting the public sector’s capacity to address biodiversity conservation issues include the following:
· Limited Policy Development and Implementation Capacity. Limited public sector ability to design and implement polices to address adverse consequences to the environment and biodiversity, associated with non-sustainable development activities, is viewed as one of the main causes of environmental degradation;[5]
· Market Failure and Forgone Revenues for Protected Areas. A major contributing factor to loss of biodiversity is the absence of markets to facilitate people’s willingness to pay for biodiversity conservation. Conversely, it is the government’s lack of capacity to enforce its "monopoly power" in PA management to correctly price access rights to protected areas and raise needed financial resources;[6]
· Limited Financial Resources and Absence of a Self-financing Policy. According to the World Bank and the Biodiversity Support Program, Peru spends less than US$50 per km2 on biodiversity funding, while Brazil spends US$130 and Mexico US$420 per km2. Moreover, given existing budgetary constraints in the public sector, most financial resources available to manage Peru’s 542 PAs come mainly from international bilateral assistance organizations and non-governmental organizations (NGOs). While this assistance is most welcome, there is a growing dependence on overseas financial aid and Peru needs to develop a coherent financing policy for the country’s Natural Protected Areas System (SINANPE). AMoreover a recent gap-analysis (yet to be finalized) indicates a large shortfall of financial resources particularly when taking into account the needs of the buffer zone communities. The project’s financing policy will should explore the use of Market-Based Instruments (MBI) that are consistent with international experience; and will be further articulatedthis will be achieved through the outputs from a parallel effort on thesupporting the development of a long-term financial management study and strategy for SINANPE.
· Weak Public Sector Capacity to Work with Civil Society and Private Sector Institutional agents in Biodiversity Conservation Activities. Similarly, although current natural protected areas legislation and SINANPE’s master plan provide for the active participation of the aforementioned agents in biodiversity conservation, there is little public sector capacity to establish and work collaboratively with civil society and the private sector. In addition,, local civil society organizations have weak technical and intellectual capacity to participate in biodiversity conservation and other related activities;
· Lack of Environmental Awareness. A 1997 national survey on environmental awareness indicated that only 17 percent of the population has an "adequate" knowledge of environmental problems, 62 percent an average knowledge and 21 percent from low to no knowledge at all.[7] Overall, it demonstrated that Peruvians are more concerned with unemployment (32%), poverty (20%) and low income (15%) than environmental issues. Environment only came in fourth as a national priority (5 percent). Nevertheless, 85 percent of the population considered that environmental problems must be promptly solved; and